Air China Limited Class ASSE: 601111

Supplemental circular

Dec 14, 2021 at 2:07 AM UTC · MarketScreener

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action you should take, 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 and the revised form of proxy and the notice of attendance 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.

(a joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 00753)

SUPPLEMENTAL CIRCULAR TO SHAREHOLDERS RELATING TO

PROPOSED REVISION OF EXISTING ANNUAL CAPS FOR CONTINUING CONNECTED TRANSACTION

AND

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY

AND

PROPOSED AMENDMENTS TO THE RULES AND PROCEDURES OF SHAREHOLDERS' MEETINGS AND THE RULES AND PROCEDURES OF
MEETINGS OF THE BOARD OF DIRECTORS

AND

SUPPLEMENTAL NOTICE OF EXTRAORDINARY GENERAL MEETING

Independent Financial Adviser to the Independent Board Committee

and the Independent Shareholders

This supplemental circular should be read together with the circular of the Company dated 12 November 2021. A letter from the Board is set out on pages 4 to 14 of this supplemental circular.

A supplemental notice convening the EGM to be held at 9:00 a.m. on Thursday, 30 December 2021 at The Conference Room C713, No. 30, Tianzhu Road, Airport Industrial Zone, Shunyi District, Beijing, the PRC, is set out in Appendix V to this supplemental circular. Whether or not you are able to attend and/or vote at the EGM, 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 EGM 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 EGM or any adjournment thereof should you so wish.

14 December 2021

	CONTENTS
	Page
DEFINITIONS . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
LETTER FROM THE BOARD . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
I. Introduction . . . . . . . . . . . . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

II. Proposed Revision of Existing Annual Caps for Continuing Connected Transaction . . . 5

Proposed Amendments to The Articles of Association and Proposed Amendments to the Rules and Procedures of Shareholders' Meetings and the Rules and Procedures of

		Meetings of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
IV.	EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	13
V.	Recommendations of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
VI.	Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	14
LETTER FROM THE INDEPENDENT BOARD COMMITTEE . . . . . . . . . . . . . . . . . . . . .	15
LETTER FROM THE INDEPENDENT FINANCIAL ADVISER . . . . . . . . . . . . . . . . . . . . .	17
APPENDIX I	- GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	27
APPENDIX II	- PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION . .	31
APPENDIX III - PROPOSED AMENDMENTS TO THE RULES AND PROCEDURES OF
		SHAREHOLDERS' MEETINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	52
APPENDIX IV - PROPOSED AMENDMENTS TO THE RULES AND PROCEDURES OF
		MEETINGS OF THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	57
APPENDIX V	- SUPPLEMENTAL NOTICE OF EXTRAORDINARY
		GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	73

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DEFINITIONS

In this supplemental circular, unless the context otherwise requires, the following expressions have the following meaning:

"ACC Group"	Air China Cargo, its subsidiaries and 30%-controlled companies (as
	defined under the Hong Kong Listing Rules)
"ACC Transactions"	the continuing connected transactions contemplated under the New
	ACC Framework Agreement between any member of the Group on
	the one hand and any member of the ACC Group on the other hand
"Air China Cargo"	Air China Cargo Co., Ltd., a company established under the laws of
	the PRC with limited liability and a non-wholly owned subsidiary
	of CNAHC
"Articles of Association"	the articles of association of the Company
"associate(s)"	has the meaning ascribed to it under the Hong Kong Listing Rules
"Bellyhold Space Business"	all the freight business operated through the utilization of the
	bellyhold space of passenger aircraft, including but not limited to
	the sale and pricing in relation to the bellyhold space
"Board"	the board of directors of the Company
"Cathay Pacific"	Cathay Pacific Airways Limited, a company incorporated in Hong
	Kong and listed on the Hong Kong Stock Exchange
"CNACG"	China National Aviation Corporation (Group) Limited, a wholly-
	owned subsidiary of CNAHC
"CNAHC"	China National Aviation Holding Corporation Limited, a state-
	owned enterprise incorporated under the laws of the PRC and the
	controlling shareholder of the Company
"Company"	Air China Limited, a company incorporated in the PRC, whose H
	shares are listed on the Hong Kong 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
"connected person"	has the meaning ascribed to it under the Hong Kong Listing Rules
"Director(s)"	the director(s) of the Company

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	DEFINITIONS
"EGM"	the extraordinary general meeting of the Company to be held at
	9:00 a.m. on Thursday, 30 December 2021 at The Conference
	Room C713, No. 30, Tianzhu Road, Airport Industrial Zone,
	Shunyi District, Beijing, the PRC for the Shareholders to consider
	and, if thought fit, to pass the resolutions set out in the notice and
	the supplemental notice of the EGM
"Existing Annual Cap(s)"	the annual cap(s) applicable to contracting operation income of the
	Bellyhold Space Business payable by ACC Group to the Group
	under the New ACC Framework Agreement for the two years
	ending 31 December 2021 and 2022 as set out in the announcement
	of the Company dated 30 October 2019
"Group"	the Company and its subsidiaries
"H Shareholder(s)"	holders of the H Share(s)
"H Share(s)"	the overseas listed foreign share(s) in the share capital of the
	Company with a nominal value of RMB1.00 each, which are listed
	on the Hong Kong Stock Exchange as its primary listing venue and
	have been admitted to the Official List of the UK Listing Authority
	as its secondary listing venue
"Hong Kong"	Hong Kong Special Administrative Region of the PRC
"Hong Kong Listing Rules"	The Rules Governing the Listing of Securities on The Stock
	Exchange of Hong Kong Limited
"Hong Kong Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Independent Board Committee"	a board committee comprising Mr. Duan Hongyi, Mr. Stanley Hui
	Hon-chung and Mr. Li Dajin, all being the independent non-
	executive Directors
"Independent Financial Adviser" or	BaoQiao Partners Capital Limited, a corporation licensed to carry
"BaoQiao Partners"	out Type 1 (dealing in securities) and Type 6 (advising on
	corporate finance) regulated activities under the SFO, being the
	independent financial adviser appointed by the Company to advise
	the Independent Board Committee and the Independent
	Shareholders in respect of the Revised Annual Cap(s)
"Independent Shareholders"	the Shareholders other than Cathay Pacific, CNAHC and their
	associate(s)

- 2 -

	DEFINITIONS
"Latest Practicable Date"	10 December 2021, being the latest practicable date prior to the
	printing of this supplemental circular for ascertaining certain
	information contained herein
"New ACC Framework Agreement"	the framework agreement dated 30 October 2019 entered into
	between the Company and Air China Cargo in respect of the ACC
	Transactions
"Original Notice"	the notice of EGM dated 12 November 2021, which sets out the
	venue of the EGM and the resolutions to be put forward at the
	EGM for the Shareholders' consideration and approval
"Original Proxy Form"	the form of proxy for the EGM enclosed with the Company's
	circular and notice of the EGM dated 12 November 2021
"Revised Annual Cap(s)"	the proposed revised annual cap(s) applicable to contracting
	operation income of the Bellyhold Space Business payable by
	ACC Group to the Group under the New ACC Framework
	Agreement for the two years ending 31 December 2021 and 2022
"Revised Proxy Form"	the revised form of proxy for the EGM, which contains the
	additional resolutions to be put forward at the EGM and is enclosed
	with this supplemental circular and the supplemental notice of the
	EGM
"RMB"	Renminbi, the lawful currency of the PRC
"SFO"	the Securities and Futures Ordinance (Chapter 571 of the Laws of
	Hong Kong), as amended and modified from time to time
"Shanghai Listing Rules"	the Rules Governing the Listing of Stocks on the Shanghai Stock
	Exchange
"Shareholder(s)"	the shareholder(s) of the Company
"substantial shareholder"	has the meaning ascribed to it under the Hong Kong Listing Rules

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