General Mandate to Issue Debt Financing Instrument
THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION
If you are in any doubt as to any aspect of this circular, you should consult a stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.
If you have sold or transferred all your shares of Air China Limited, you should at once hand this circular to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale was effected for transmission to the purchaser or the transferee.
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.
AIR CHINA LIMITED
(a joint stock limited company incorporated in the People's Republic of China with limited liability)
(Stock Code: 00753)
General Mandate to Issue Debt Financing Instruments
and
Supplemental Notice of Annual General Meeting
A letter from the Board is set out on pages 2 to 5 of this circular.
A supplemental notice convening the annual general meeting of the Company for the year 2011 to be held at 10:00 a.m. on Thursday, 24 May 2012 at The Conference Room, 29/F, Air China Building, 36 Xiaoyun Road, Chaoyang District, Beijing, PRC, is set out on pages I-1 to I-2 of this circular. Whether or not you are able to attend the AGM, you are requested to complete and return the accompanying revised form of proxy in accordance with the instructions printed thereon as soon as possible but in any event not less than 24 hours before the time appointed for convening the AGM or any adjournment thereof. Completion and return of the revised form of proxy will not preclude you from attending and voting in person at the AGM or any adjournment should you so wish.
8 May 2012
CONTENTS
Page
DEFINITIONS.......................................................................................................................... ....... 1
LETTER FROM THE BOARD................................................................................................... ....... 2
APPENDIX I - SUPPLEMENTAL NOTICE OF
ANNUAL GENERAL MEETING....................................................... I-1
- i -
DEFINITIONS
In this circular, the following expressions have the following meanings, unless the context requires otherwise:
"AGM" the annual general meeting of the Company for the year 2011 to be held at 10:00 a.m. on Thursday, 24 May 2012 at The Conference Room, 29/F, Air China Building, 36 Xiaoyun Road, Chaoyang District, Beijing, PRC for the Shareholders to consider and approve the resolutions set out in the notice of the AGM dated 10 April 2012 and the supplemental notice of the AGM dated 8 May 2012
"Board" the board of Directors
"Company" Air China Limited, a company incorporated in the People's Republic of China, whose H Shares are listed on the Stock Exchange as its primary listing venue and on the Official List of the UK Listing Authority as its secondary listing venue, and whose A Shares are listed on the Shanghai Stock Exchange
"Debt Financing Instruments" the debt financing instruments denominated in RMB or foreign currencies to be issued by the Company and/or its controlled or wholly-owned subsidiary in one or multiple tranches, including but not limited to corporate bonds, ultra-short-term commercial paper, short-term commercial paper, mid-term notes, domestic non-public targeted debt financing instruments, overseas non-public targeted debt financing instruments and overseas bonds/notes
"Director(s)" the director(s) of the Company
"Hong Kong" the Hong Kong Special Administrative Region of the PRC
"Listing Rules" the Rules Governing the Listing of Securities on the Stock Exchange
"PRC" the People's Republic of China, excluding, for the purpose of this circular only, Hong Kong, Macau and Taiwan
"RMB" Renminbi, the lawful currency of the PRC
"Shareholder(s)" registered holder(s) of the shares of the Company
"Stock Exchange" The Stock Exchange of Hong Kong Limited
- 1 -
LETTER FROM THE BOARD
AIR CHINA LIMITED
(a joint stock limited company incorporated in the People's Republic of China with limited liability)
(Stock Code: 00753)
Directors:
Non-executive Directors:
Wang Changshun (Chairman)
Wang Yinxiang
Cao Jianxiong
Sun Yude
Christopher Dale Pratt
Ian Sai Cheung Shiu
Executive Directors:
Cai Jianjiang (President)
Fan Cheng
Independent Non-executive Directors:
Fu Yang
Li Shuang
Han Fangming
Yang Yuzhong
Registered Address:
9th Floor, Blue Sky Mansion
28 Tianzhu Road, Zone A
Tianzhu Airport Industrial Zone
Shunyi District
Beijing, PRC
Principal Place of
Business in Hong Kong:
5th Floor, CNAC House
12 Tung Fai Road
Hong Kong International Airport
Hong Kong
8 May 2012
To the Shareholders
Dear Sir or Madam,
General Mandate to Issue Debt Financing Instruments
and
Supplemental Notice of Annual General Meeting
I. INTRODUCTION
In addition to the resolutions to be proposed at the AGM, details of which are set out in the notice of the AGM dated 10 April 2012, it is proposed that at the AGM, an additional resolution will be proposed to grant a general mandate to the Board to issue Debt Financing Instruments.
- 2 -
LETTER FROM THE BOARD
The supplemental notice of AGM is set out on pages I-1 to I-2 of this circular.
II. GENERAL MANDATE TO ISSUE DEBT FINANCING INSTRUMENTS
1. Background
In order to meet the demand of the operation of the Company, adjust its debt structure, replenish its working capital and lower its financing costs, the Board has resolved to obtain a general mandate to issue debt financing instruments, which shall be subject to the Shareholders' approval by way of special resolution at the AGM.
2. Particulars of debt financing instruments
Particulars regarding the proposed issuance of debt financing instruments are as follows:
(i) Issuer: the Company and/or its wholly-owned or controlled subsidiary
(ii) Issue size: the total balance of the Debt Financing Instruments outstanding will be no more than 40% of the Company's latest consolidated net assets as at the time of the issuance in accordance with the applicable laws and regulations
(iii) Term and type: not more than 15 years for one single-term instrument or a portfolio of instruments with various terms
(iv) Use of proceeds: the proceeds to be raised from the issuance are intended to be used towards meeting the demand of the Company's operations, adjusting its debt structure, replenishing its working capital and/or funding its capital investments, among others
(v) Term of validity from the date of the passing of the resolution at the AGM to the
of the resoluti date of the annual general meeting of the Company for the year ended
31 December 2012
If the Board and/or its authorised person have resolved to issue the Debt Financing Instruments within the term of the mandate and the Company has obtained the approval, permission or registration for the issuance from the relevant regulatory authorities within the term of the mandate, the Company may complete the issuance within the validity period of such approval, permission or registration.
- 3 -
LETTER FROM THE BOARD
3. Authorisation to the Board
3.1 It is proposed to the Shareholders at the AGM to authorise the Board, generally and unconditionally, to deal with the following in accordance with the specific needs of the Company and market conditions:
(i) to determine the issuer, type, specific instruments, detailed terms, conditions and other matters relating to the issuance (including, but not limited to, the issue size, principle amount, currency, issue price, interest rate or mechanism for determining the interest rate, issue place, issue timing, term, whether or not to issue in multiple tranches and number of tranches, whether or not to set repurchase or redemption terms, credit rating, guarantee, repayment term, use of proceeds, underwriting arrangements and all other matters relating to the issuance);
(ii) to carry out all necessary and ancillary actions and procedures (including, but not limited to, select and engage intermediary institutions, handle all approval, registration and filing procedures with the relevant regulatory authorities in connection with the issuance on behalf of the Company, execute all necessary documents for the issuance and handle any other matters relating to the issuance and trading);
(iii) to approve, confirm and ratify any action or procedure relating to the issuance as mentioned above already taken by the Company;
(iv) to make adjustments to the specific proposals for the issuance in accordance with the comments from the relevant regulatory authorities or the market conditions within the authority of the Board, in the case of any change in policies of regulatory bodies in relation to the issuance, or any change of market conditions, except where voting at a general meeting is required by any relevant laws and regulations and the articles of association of the Company;
(v) to determine and handle all relevant matters relating to the listing of the Debt Financing Instruments upon the completion of the issuance; and
(vi) to approve, execute and dispatch any announcements or circulars relating to the issuance and make any related disclosure in accordance with the listing rules of the relevant jurisdictions where the shares of the Company are listed.
3.2 Upon the approval of paragraph 3.1 above at the AGM, it is proposed that the Shareholders shall authorise the Board to delegate the authorisations set forth in items (i) to (v) of paragraph 3.1 above to the president and/or the general accountant of the Company.
3.3 Upon the approval of paragraph 3.1 above at the AGM, it is proposed that the Shareholders shall authorise the Board to delegate the authorisation set forth in item (vi) of paragraph 3.1 above to the secretary of the Board.
- 4 -
LETTER FROM THE BOARD
III. RECOMMENDATION
The Directors consider that the proposed resolution above is fair and reasonable so far as the Shareholders are concerned and accordingly recommend the Shareholders to consider the proposed resolution above and to vote in favour of such resolution to be proposed at the AGM.
IV. AGM
The Company will convene its annual general meeting for the year 2011 at 10:00 a.m. on Thursday, 24 May 2012 at The Conference Room, 29/F, Air China Building, 36 Xiaoyun Road, Chaoyang District, Beijing, PRC. In accordance with the Listing Rules, a notice of AGM, a form of proxy and an attendance notice have been dispatched to the Shareholders on Tuesday, 10 April 2012 and a supplemental notice of AGM and a revised form of proxy (the "Revised Proxy Form") will be dispatched to the Shareholders on Tuesday, 8 May 2012. The supplemental notice of AGM is reproduced on pages I-1 to I-2 of this circular.
Whether or not you intend to attend the AGM, you are requested to complete and return the Revised Proxy Form in accordance with the instruction printed thereon. Completion and return of the Revised Proxy Form will not preclude you from attending and voting in person at the AGM or at any adjournment should you so wish and completion and return of the notice of attendance do not affect the right of a Shareholder to attend the respective meeting.
By order of the Board
Wang Changshun
Chairman
Beijing, the PRC
- 5 -
APPENDIX I SUPPLEMENTAL NOTICE OF ANNUAL GENERAL MEETING
AIR CHINA LIMITED
(a joint stock limited company incorporated in the People's Republic of China with limited liability)
(Stock Code: 00753)
SUPPLEMENTAL NOTICE OF ANNUAL GENERAL MEETING
Reference is made to the notice of the annual general meeting of Air China Limited (the "Company") dated 10 April 2012 (the "Former AGM Notice") which sets out the resolutions to be considered by shareholders at the annual general meeting for the year ended 31 December 2011 to be held at 10:00 a.m. on Thursday, 24 May 2012 at The Conference Room, 29/F, Air China Building, 36 Xiaoyun Road, Chaoyang District, Beijing, PRC (the "AGM").
SUPPLEMENTAL NOTICE IS HEREBY GIVEN that the AGM, which will be held as originally scheduled, will consider and, if thought fit, pass the following special resolution in addition to the resolutions set out in the Former AGM Notice:
SPECIAL RESOLUTION
8. To consider and approve the resolution in relation to the grant of a general mandate to the board of directors (the "Board") of the Company to issue debt financing instruments:
"THAT the Board of the Company be and is hereby authorised, generally and unconditionally, to issue, in one or multiple tranche(s), debt financing instruments within the permissible size under the applicable laws and regulations. Debt financing instruments include but are not limited to corporate bonds, ultra-short- term commercial papers, short-term commercial papers, mid-term notes, domestic non-public targeted debt financing instruments, overseas non-public targeted debt financing instruments and overseas bonds/notes denominated in RMB or foreign currencies."
By order of the Board
Air China Limited
Wang Changshun
Chairman
Beijing, the PRC, 8 May 2012
- I-1 -
APPENDIX I SUPPLEMENTAL NOTICE OF ANNUAL GENERAL MEETING
Notes:
(1) A revised form of proxy is enclosed with this notice. Whether or not you are able to attend the AGM, you are requested to complete the accompanying revised form of proxy in accordance with the instructions printed thereon and return the same to the Company's H Share Registrar, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong as soon as practicable and in any event not less than 24 hours before the time appointed for the holding of the Meeting or any adjournment thereof (as the case may be). Completion and return of the revised form of proxy will not preclude the shareholders of the Company from attending and voting in person at the AGM or any adjournment thereof.
(2) Please refer to the Former AGM Notice for details in respect of the eligibility for attending the AGM, proxy, registration procedures, closure of register of members and other relevant matters.
(3) Please refer to the notice of attendance of the AGM of the Company in respect of the timing and address for attending the AGM and other relevant matters.
As at the date of this notice, the directors of the Company are Mr. Wang Changshun, Ms. Wang Yinxiang, Mr. Cao Jianxiong, Mr. Sun Yude, Mr. Christopher Dale Pratt, Mr. Ian Sai Cheung Shiu, Mr. Cai Jianjiang, Mr. Fan Cheng, Mr. Fu Yang*, Mr. Li Shuang*, Mr. Han Fangming* and Mr. Yang Yuzhong*.
* Independent non-executive director of the Company
- I-2 -
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