REG - Air China Ld - ARTICLES OF ASSOCIATION OF AIR CHINA LIMITED
25/06/2025 10:00
For best results when printing this announcement, please click on link below:
https://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20250625:nRSY3550Oa&default-theme=true
RNS Number : 3550O Air China Ld 25 June 2025
The English translation of the articles of association of Air China Limited
(the "Articles") is for reference only. In the event of discrepancy between
the English translation and the Chinese version of the Articles, the Chinese
version shall prevail.
ARTICLES OF ASSOCIATION OF
AIR CHINA LIMITED
Adopted by the first extraordinary general meeting on 30 September 2004
Approved by the State-owned Assets Supervision and Administration Commission
of the State Council on 12 October 2004
Adopted by the 2004 annual shareholder's general meeting on 30 May 2005
Approved by the State-Owned Assets Supervision and Administration Commission
of the State Council on 14 March 2006
Adopted by the 2006 first extraordinary general meeting on 28 March 2006
Approved by the State-Owned Assets Supervision and Administration Commission
of the State Council on 5 June 2006
Adopted by the 2005 annual shareholder's general meeting on 12 June 2006
Approved by the State-Owned Assets Supervision and Administration Commission
of the State Council on 28 December 2006
Adopted by the 2006 first extraordinary general meeting on 28 March 2006
Adopted by the 2006 third extraordinary general meeting on 28 December 2006
Approved by the State-Owned Assets Supervision and Administration Commission
of the State Council on 1 June 2007
Adopted by the 2006 annual shareholders' general meeting on 30 May 2007
Approved by the State-Owned Assets Supervision and Administration Commission
of the State Council on 7 August 2007
Adopted by the 2007 annual shareholders' general meeting on 30 May 2008
Approved by the State-Owned Assets Supervision and Administration Commission
of the State Council on 4 March 2009
Adopted by the 2008 annual shareholders' general meeting on 10 June 2009
Approved by the State-Owned Assets Supervision and Administration Commission
of the State Council on 19 October 2009
Adopted by the 2010 first extraordinary general meeting on 29 April 2010
Approved by the State-Owned Assets Supervision and
Administration Commission of the State Council on 26 January 2011
Adopted by the 2012 second extraordinary general meeting on 26 June 2012
Adopted by the 2012 third extraordinary general meeting on 20 December 2012
Approved by the State-Owned Assets Supervision and
Administration Commission of the State Council on 3 May 2013
Adopted by the 2015 first extraordinary general meeting on 22 December 2015
Adopted by the 2016 first extraordinary general meeting on 26 January 2016
Adopted by the 2017 first extraordinary general meeting on 23 January 2017
Adopted by the 2017 second extraordinary general meeting on 30 March 2017
Adopted by the 2017 third extraordinary general meeting on 27 October 2017
Adopted by the 2018 first extraordinary general meeting on 19 October 2018
Adopted by the 2020 annual shareholders' general meeting on 25 May 2021
Adopted by the 2021 second extraordinary general meeting on 30 December 2021
Adopted by the 2022 second extraordinary general meeting on 20 September 2022
Adopted by the 2023 third extraordinary general meeting, the 2023 first A
shareholders' class meeting and the 2023 first H shareholders' class meeting
on 26 October 2023 Adopted by the 2024 first extraordinary general meeting on
26 January 2024
Adopted by the 2024 annual shareholders' meeting on 24 June 2025
Contents
CHAPTER 1 : GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
CHAPTER 2 : THE COMPANY'S OBJECTIVES AND SCOPE OF BUSINESS . . . 3
CHAPTER 3 : SHARES AND REGISTERED CAPITAL . . . . . . . . . . . . . . . . . . . . 4
CHAPTER 4 : INCREASE, DECREASE AND REPURCHASE OF SHARES . . . . . 7
CHAPTER 5 : SHARE TRANSFER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
. . .
CHAPTER 6 : SHARE CERTIFICATES AND REGISTER OF SHAREHOLDERS . . 11
CHAPTER 7 : SHAREHOLDERS' RIGHTS AND OBLIGATIONS . . . . . . . . . . . . 15
CHAPTER 8 : SHAREHOLDERS' MEETINGS . . . . . . . . . . . . . . . . . . . . . . . . . . 21
CHAPTER 9 : THE PARTY COMMITTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
CHAPTER 10 : BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
CHAPTER 11 : INDEPENDENT DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
CHAPTER 12 : SPECIAL COMMITTEES OF THE BOARD OF DIRECTORS . . . . 56
CHAPTER 13 : SECRETARY OF THE BOARD OF DIRECTORS . . . . . . . . . . . . . 59
CHAPTER 14 : SENIOR OFFICERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
. . .
CHAPTER 15 : THE QUALIFICATIONS AND DUTIES OF THE DIRECTORS, SENIOR OFFICERS OF THE COMPANY
. . . . . . . . . . . . . . . . .
63
CHAPTER 16 : FINANCIAL AND ACCOUNTING SYSTEMS, PROFIT DISTRIBUTION AND AUDIT . . . . . . .
. . . . . . . . . . . . . . . . . . .
68
CHAPTER 17 : APPOINTMENT OF ACCOUNTANCY FIRM . . . . . . . . . . . . . . . . 76
CHAPTER 18 : MERGER AND DEMERGER OF THE COMPANY . . . . . . . . . . . . 76
CHAPTER 19 : DISSOLUTION AND LIQUIDATION . . . . . . . . . . . . . . . . . . . . . . 78
CHAPTER 20 : PROCEDURES FOR AMENDMENT OF THE COMPANY'S ARTICLES OF ASSOCIATION . . . . . .
. . . . . . . . . . . . . . . . . .
81
CHAPTER 21 : NOTICES AND PUBLIC ANNOUNCEMENTS . . . . . . . . . . . . . . . 82
CHAPTER 22 : SUPPLEMENTARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
. .
CHAPTER 1: GENERAL PROVISIONS
Article 1 Air China Limited (the "Company") is a joint stock limited company established
in accordance with the Company Law of the People's Republic of China (the
"Company Law"), the Securities Law of the People's Republic of China (the
"Securities Law") and other relevant laws and regulations of the State.
The Company was established by way of promotion with the approval of the
State-owned Assets Supervision and Administration Commission of the State
Council on 30 September 2004, as evidenced by the approval document Guo Zi Gai
Ge 2004 No. 872. It was registered with and has obtained a business licence
from the State Administration for Industry & Commerce of the People's
Republic of China.
The promoters of the Company are: China National Aviation Holding Corporation
Limited and China National Aviation Corporation (Group) Limited (registered in
Hong Kong Special Administration Region).
Article 2 The Company's registered Chinese name: 中國國際航空股份有限公司
The Company's English name: AIR CHINA LIMITED The Company's abbreviated
Chinese name: 中國國航 The Company's abbreviated English name: AIR CHINA
Article 3 The Company's address: 1st Floor-9th Floor 101, Building 1, 30 Tianzhu Road,
Shunyi District, Beijing, China.
Article 4 The Company's legal representative is the Chairman of the board of directors
of the Company. The legal consequences of civil activities performed by the
legal representative in the name of the Company shall be borne by the Company.
Article 5 The Company is a joint stock limited company which has perpetual existence.
The liability of a shareholder is limited to the value of the shares held by
him, while the Company assumes liabilities to the extent of its entire assets.
The Company is an independent corporate legal person, governed by, and
existing under the protection of, the laws and regulations of the People's
Republic of China.
Article 6 In accordance with the provisions of the Company Law, the Securities Law, the
Guidance on the Articles of Association of Listed Companies (the "Guidance"),
the Standards on Corporate Governance for Listed Companies (the "CG
Standards"), the Rules Governing the Listing of Stocks on the Shanghai Stock
Exchange, the Rules Governing the Listing of Securities on The Stock Exchange
of Hong Kong Limited (the "Hong Kong Listing Rules") and other PRC laws and
administrative regulations and departmental rules, the Company amended the
original Articles of Association of the Company (the "Original Articles of
Association") and adopted these Articles of Association (the "Articles of
Association" or "these Articles of Association").
Article 7 From the date on which the Articles of Association come into effect, the
Articles of Association constitute the legally binding document regulating the
Company's organisation and activities, and the rights and obligations between
the Company and each shareholder and among the shareholders.
Article 8 The Articles of Association are binding on the Company and its shareholders,
directors and senior officers; all of whom may, according to the Company's
Articles of Association, assert their rights in respect of the affairs of the
Company.
A shareholder may take action against the Company pursuant to the Company's
Articles of Association. The Company may take action against a shareholder,
directors and senior officers of the Company pursuant to the Company's
Articles of Association. A shareholder may also take action against another
shareholder, and may take action against the directors and senior officers of
the Company pursuant to the Company's Articles of Association.
The "senior officers" referred to in these Articles of Association mean the
president, vice president, chief accountant, board secretary, chief pilot,
general legal counsel and other senior officers appointed by the board of
directors of the Company.
Article 9 The Company may invest in other enterprises; provided that unless otherwise
provided by laws, regulations and other regulatory documents, the Company
shall not act as a capital contributor which assumes joint and several
liabilities of the enterprises it invested in.
Article 10 According to the Constitution of the Communist Party of China, the Company
shall establish an organization of the Communist Party of China to carry out
the activities of the Party, establish a working organ for the Party, allocate
sufficient and competent personnel to handle Party affairs and provide
sufficient funds to operate the Party organization.
CHAPTER 2: THE COMPANY'S OBJECTIVES AND SCOPE OF BUSINESS
Article 11 The Company's objectives are: to maximise Shareholders' interests by providing
safe, fast, accurate, economical, convenient and satisfactory air package and
cargo transportation services through customer-oriented, market driven
operations with the end of advanced communications technologies, and develop
telecommunications and information businesses.
Article 12 The Company's scope of business shall be consistent with and subject to the
scope of business approved by the authority responsible for the registration
of the Company.
The Company's scope of business includes: International and domestic scheduled
and unscheduled air passenger, air cargo, mail and luggage transportation;
domestic and international business aviation services; management and
administration of aircraft, aircraft maintenance, repair and overhaul
services, business agency among airlines companies; and ground services, air
express service (other than mails and objects of the same nature as mails)
related to the main business; on-board duty free items, on-board retail of
goods and underwriting the aviation accident insurance; import and export
businesses; hotel management; undertaking exhibitions; conference services;
property management; design, production, agency and publish of advertisement;
technology training; lease of self-owned property; rental of machinery and
equipment; accommodation; catering services; sales of handicrafts and
souvenirs; wholesale of agriculture, forestry, animal husbandry and fishery
products, wholesale of food, beverages and tobacco products, wholesale of
textiles, clothing and household goods, wholesale of culture, sporting goods
and equipment, wholesale of mineral products, building materials and chemical
products, wholesale of machinery and equipment, hardware and electronic
products, general retail, special retail of food, beverage and tobacco
products, special retail of textiles, clothing and daily necessities, special
retail of cultural and sporting goods and equipment, sales of automobiles,
motorcycles, spare parts and fuels and other types of energy resources,
special retail of household appliances and electronics, special retail of
hardware, furniture and interior decoration materials, and Internet retailing.
(Catering services, accommodation and other projects subject to approval in
accordance with the law shall be operated with the approval of relevant
authorities to the extent authorized by the approval.)
Article 13 Based on its business development needs and upon approval of the relevant
governmental authorities, the Company may adjust its scope of business and
manner of operation from time to time, and may establish branch organisations
and/or representative offices (irrespective of whether controlled or owned by
it) in the PRC or overseas.
CHAPTER 3: SHARES AND REGISTERED CAPITAL
Article 14 The Company's equity shall be represented in the form of shares. There shall,
at all times, be ordinary shares in the Company. Subject to the approval of
the department authorized by the State Council, the Company may, according to
its requirements, create different classes of shares. The issuance of the
Company shares shall adhere to the principles of openness, fairness, and
impartiality, and each share of the same class shall have equal rights. For
shares of the same class issued in the same tranche, the issuance terms and
price per share shall be identical; all subscribers shall pay the same
consideration per share.
Article 15 The shares issued by the Company shall each have a par value of Renminbi one
(1.00) yuan.
"Renminbi" referred to in the previous paragraph means the legal currency of
the PRC.
Article 16 The Company may issue shares to Domestic Investors and Foreign Investors
according to the laws, and shall register or file with the securities
regulatory authority of the State Council according to the requirements.
"Foreign Investors" referred to in the previous paragraph mean those investors
who subscribe for the shares issued by the Company and who are located in
foreign countries and in the regions of Hong Kong, Macau and Taiwan. "Domestic
Investors" mean those investors who subscribe for the shares issued by the
Company and who are located within the territory of the PRC.
Article 17 Shares which the Company issues to Domestic Investors for subscription in
Renminbi shall be referred to as "Domestic Shares". Shares which the Company
issues to Foreign Investors for subscription in foreign currencies shall be
referred to as "Foreign Shares". Foreign Shares which are listed overseas are
called "Overseas-Listed Foreign Shares". Both holders of Domestic Shares and
holders of Foreign Shares are holders of ordinary shares, and have the same
obligations and rights.
"Foreign currencies" means the legal currencies of countries or outside the
PRC which are recognised by the foreign exchange authority of the State and
which can be used to pay the share price to the Company.
Article 18 A Shares are ordinary shares in Renminbi that have been admitted for listing
on domestic stock exchanges. H Shares are shares that have been admitted for
listing on The Stock Exchange of Hong Kong Limited (the "Stock Exchange").
The A Shares of the Company shall be centralized and held in custody by the
Shanghai Branch of the China Securities Depository and Clearing Corporation
Limited. The Overseas-Listed Foreign Shares of the Company shall be held in
custody by Hong Kong Securities Clearing Company Limited.
Article 19 Upon the approval of the department authorized by the State Council, the
Company issued 6,500,000,000 ordinary shares to the promoters at the time when
the Company was established. At the time of establishment, the capital
contribution of the promoters of the Company was as follows:
Number of Date of Capital Contribution
Name of Promoters Shares Subscribed
Method of Capital Contribution
China National Aviation Holding Corporation Limited 5,054,276,915 A capital contribution of RMB560,782,100 was made in cash and a contribution 9 September
of RMB6,451,765,800 was made in form of the assets and liability of its
subsidiaries and those relating to its principal passenger 2004
and cargo businesses
China National Aviation Corporation 1,445,723,085 A capital contribution of RMB2,005,866,000 was made in form of equity interest 9 September
(Group) Limited 2004
Article 20 As approved by the competence authorities, the changes in the share capital of
the Company were as follows:
The Company shall issue additional 2,933,210,909 ordinary shares after its
incorporation, and the promoters of the Company shall sell 293,321,091
ordinary shares, all of which are H Shares.
Upon completion of the offering of the H Shares set forth above, the Company
has issued 1,639,000,000 A shares in 2006.
Upon the completion of the issuance of A shares, the Company has issued
1,179,151,364 H Shares to Cathay Pacific Airways Limited, a shareholder of the
Company, in 2006.
Upon the completion of the said additional issuance of H Shares, the Company
has issued 483,592,400 new A Shares on a non-public issue basis and
157,000,000 new H Shares to China National Aviation Corporation (Group)
Limited, a shareholder of the Company, on a non-public issue basis in the year
of 2010.
Upon the completion of the aforesaid non-public issue of A Shares and H
Shares, the Company has issued 192,796,331 new A Shares to China National
Aviation Holding Corporation Limited, a shareholder of the Company, on a
non-public issue basis in the year of 2013.
Upon the completion of the aforesaid non-public issue of A Shares, the Company
has issued 1,440,064,181 A Shares on a non-public issue basis in the year of
2017.
Upon the completion of the aforesaid non-public issue of A Shares, the Company
has issued 1,675,977,653 A Shares on a non-public issuance basis in the year
of 2023.
Upon the completion of the aforesaid non-public issue of A Shares, the Company
has issued 392,927,308 H Shares to specific investor in the year of 2024.
Upon the completion of the aforesaid non-public issue of H shares, the Company
has issued 854,700,854 A Shares to specific investor in the year of 2024.
The present share capital structure of the Company is as follows: the Company
has a total of 17,448,421,000 ordinary shares in issue, of which
12,492,810,328 shares are held by holders of A Shares, representing
approximately 71.60% of the Company's total share capital, and 4,955,610,672
shares are held by holders of H Shares, representing approximately 28.40% of
the Company's total share capital.
Article 21 The registered capital of the Company is RMB17,448,421,000. The number of
shares issued by the Company is 17,448,421,000 shares, all of which are
ordinary shares.
Article 22 The Company or the Company's subsidiaries (including the Company's affiliated
enterprises) shall not provide any financial assistance in the form of
donates, advances, guarantees or borrowings to other persons who acquire the
shares of the Company or its parent company, except for the implementation of
the Company's employee share ownership plan.
For the interests of the Company, upon a resolution of the shareholders'
meeting, or a resolution of the board of directors in accordance with the
Articles of Association or the authorization of the shareholders' meeting, the
Company may provide financial assistance to other persons for the acquisition
of the shares of the Company or its parent company, provided that the
cumulative total amount of the financial assistance shall not exceed 10
percent of the total issued share capital. Resolutions made by the board of
directors shall be approved by more than two-thirds of all directors.
CHAPTER 4: INCREASE, DECREASE AND REPURCHASE OF SHARES
Article 23 The Company may, based on its operating and development needs, authorize the
increase of its capital pursuant to the Articles of Association.
The Company may increase its capital in the following ways:
(1) by offering of shares to unspecified targets;
(2) by offering of shares to specified targets;
(3) by issuing bonus shares to its existing shareholders;
(4) by converting the common reserve into share capital;
(5) by any other means which is prescribed by laws, administrative
regulations and the CSRC.
After the Company's increase of capital has been approved in accordance with
the provisions of the Articles of Association, the issuance thereof should be
made in accordance with the procedures set out in the relevant State laws and
administrative regulations.
Article 24 According to the provisions of the Articles of Association, the Company may
reduce its registered capital.
Article 25 The Company must prepare a balance sheet and an inventory of assets when it
reduces its registered capital.
The Company shall notify its creditors within ten (10) days of the date of the
Company's resolution for reduction of capital and shall publish an
announcement in a newspaper or on the National Enterprise Credit Information
Publicity System within thirty (30) days of the date of such resolution. A
creditor has the right within thirty (30) days of receipt of the notice from
the Company or, in the case of a creditor who does not receive such notice,
within forty-five (45) days of the date of announcement, to require the
Company to repay its debts or to provide a corresponding guarantee for such
debt.
Where the Company reduces its registered capital, the amount of capital
contribution or shares shall be reduced in proportion to the shares held by
the shareholders, unless otherwise provided by laws or the Articles of
Association.
Article 26 The Company shall not acquire shares of the Company. However, except in one of
the following circumstances:
(1) reducing its registered capital;
(2) merging with another company that holds shares in the Company;
(3) using the shares for the employee share ownership plan or as share
incentive;
(4) acquiring as requested the shares of shareholders who vote against
any resolution on the merger or demerger of the Company adopted at a
shareholders' meeting;
(5) using the shares for the conversion of the corporate bonds issued
by the listed company which are convertible into shares;
(6) necessary for safeguarding the value of the Company and the
shareholders' interests;
(7) other circumstances permitted by laws and administrative
regulations.
The Company's repurchase of its issued shares shall comply with the provisions
of Article 27 to Article 28 of these Articles of Association.
Article 27 The Company may acquire the shares of the Company by way of open and
centralized trading, or by other means approved by the laws and regulations
and the CSRC.
The repurchase of the shares of the Company arising from the circumstances
provided under items (3), (5) and (6) of the first paragraph of Article 26 of
these Articles of Association shall be carried out by way of open and
centralized trading.
Article 28 The purchase of the shares of the Company arising from the circumstances
provided under items (1) and (2) of the first paragraph of Article 26 of the
Articles of Association shall be made by the resolution of the shareholders'
meeting; the purchase of the shares of the Company arising from the
circumstances provided under items (3), (5) and (6) of the first paragraph of
Article 26 of the Articles of Association may be made by the resolutions of
the board of directors in a board meeting where more than two-thirds (2/3) of
directors are attending under the provisions of the Articles of Association or
the authorization granted at the shareholders' meeting.
After the purchase of the shares of the Company according to the provision of
Article 26, the shares shall be cancelled within 10 days from the date of
purchase under the circumstance of the item (1) of the first paragraph; the
shares shall be transferred or cancelled within 6 months under the
circumstances of items (2) and (4) of the first paragraph; the total number of
shares then held by the Company shall not exceed ten percent of the total
number of its issued shares and the shares so purchased shall be transferred
or cancelled within 3 years under the circumstances of items (3), (5) and (6)
of the first paragraph.
If it is otherwise provided for the repurchase and cancellation of shares
under the relevant rules of the regulatory authorities and stock exchanges of
the jurisdictions where the shares of the Company are listed, such
requirements shall prevail.
The aggregate par value of the cancelled shares shall be deducted from the
Company's registered share capital.
CHAPTER 5: SHARE TRANSFER
Article 29 Unless otherwise provided in laws, regulations and other regulatory documents,
the shares of the Company shall be transferrable in accordance with laws.
Article 30 The Company shall not accept its own shares as the subject matter of a pledge.
Article 31 The shares issued before the Company's public offering of shares shall not be
transferred within one year from the date on which the shares of the Company
are listed and traded on a stock exchange.
The directors and senior officers of the Company shall report to the Company
the shares of the Company held by him/her and the changes thereof. During the
term of his/her office as determined when he/she takes office, the shares
transferred by him/her each year shall not exceed 25% of the total shares of
the Company that he/she holds. The shares of the Company held by the aforesaid
persons shall not be transferred within one year from the date on which the
shares of the Company are listed and traded on a stock exchange. The aforesaid
persons shall not transfer the shares of the Company that he/she holds within
half a year after leaving his/her office.
Article 32 Should a shareholder, director or senior officer holding 5% or more of the
Company's shares sells his/her shares in the Company or other securities of
equity nature within 6 months from the date of purchase of the same, or
repurchase the shares within 6 months from the date of selling the same, the
profits derived from such activities shall be vested in the Company. The board
of directors of the Company shall recover from the aforementioned parties the
gains derived therefrom, except where a securities company holding 5% or more
of the shares as a result of its purchase of remaining shares after sold under
an underwriting obligation, and otherwise required by the CSRC.
Shares or other securities of equity nature held by directors, senior officers
and natural person shareholders referred to in the preceding paragraph include
shares or other securities of equity nature held by their spouses, parents,
children and under accounts of other persons.
Should the Company's board of directors not comply with the provision set
forth in the first paragraph of this Article and act accordingly, the
shareholders shall have the right to request the board of directors to duly
act in accordance with the same within 30 days. Should the Company's board of
directors not act in accordance with the same within the aforementioned
period, the shareholders shall have the right to initiate proceedings at a
People's Court directly in his/her own name for the interests of the Company.
Should the Company's board of directors not comply with the provision set out
in the first paragraph of this Article and act accordingly, the responsible
directors shall assume joint liabilities in accordance with the laws.
CHAPTER 6: SHARE CERTIFICATES AND REGISTER OF SHAREHOLDERS
Article 33 Share certificates of the Company shall be in registered form.
The share certificate of the Company shall contain the following main
particulars:
(1) the name of the Company;
(2) the date of registration and incorporation of the Company;
(3) the class of shares, par value and number of shares it represents;
(4) the share certificate number;
(5) other matters required to be stated therein by the Company Law and
the stock exchange(s) on which the Company's shares are listed.
Article 34 Share certificates of the Company may be assigned, given as a gift, inherited
or pledged in accordance with relevant provisions of laws, administrative
regulations and these Articles of Association, and relevant registration shall
be carried out with the share registration institution authorized by the
Company.
Article 35 Share certificates of the Company shall be signed by the legal representative
of the Company's board of directors. Where the stock exchange(s) on which the
Company's shares are listed require other senior officer(s) of the Company to
sign on the share certificates, the share certificates shall also be signed by
such senior officer(s). The share certificates shall take effect after being
affixed with the seal of the Company (including the seal of the Company
especially for securities). The share certificate shall be affixed with the
seal of the Company or the seal of the Company especially for securities under
the authorization of the board of directors. The signatures of the Chairman of
the board of directors or other senior officer(s) of the Company may be in
printed form. Subject to the conditions of paperless offering and trading of
the shares of the Company, the laws and rules otherwise provided by the
regulatory authorities of the jurisdictions where the shares of the Company
are listed are applicable.
Article 36 The Company keeps a register of shareholders which shall be sufficient
evidence of the shareholders' shareholdings in the Company.
Article 37 The Company may, in accordance with the mutual understanding and agreements
made between the securities authority of the State Council and overseas
securities regulatory organisations, maintain the register of shareholders of
Overseas-Listed Foreign Shares overseas and appoint overseas agent(s) to
manage such register of shareholders. The original register for holders of
Overseas-Listed Foreign Shares listed in Hong Kong shall be maintained in Hong
Kong.
A duplicate register of shareholders for the holders of Overseas-Listed
Foreign Shares shall be maintained at the Company's residence. The appointed
overseas agent(s) shall ensure consistency between the original and the
duplicate register of shareholders at all times.
If there is any inconsistency between the original and the duplicate register
of shareholders for the holders of Overseas-Listed Foreign Shares, the
original register of shareholders shall prevail.
Article 38 The Company shall have a complete register of shareholders, which shall
comprise the following parts:
(1) the register of shareholders which is maintained at the Company's
residence (other than those share registers which are described in sub-
paragraphs (2) and (3) of this Article);
(2) the register of shareholders in respect of the holders of
Overseas-Listed Foreign Shares of the Company which is maintained in the same
place as the overseas stock exchange on which the shares are listed; and
(3) the register of shareholders which are maintained in such other
place as the board of directors may consider necessary for the purposes of the
listing of the Company's shares.
Article 39 Different parts of the register of shareholders shall not overlap. No transfer
of any shares registered in any part of the register shall, during the
continuance of that registration, be registered in any other part of the
register.
Any change or correction to various parts of the register of shareholders
shall be carried out in accordance with the law of the place where such parts
of the register of shareholders are maintained.
Article 40 The transfer of Overseas-Listed Foreign Shares in the Company listed in Hong
Kong shall be carried out in writing through transfer instruments in normal or
ordinary form or in the form acceptable to the board of directors; and such
transfer instrument can be signed only under hand or affixed with the seal of
the Company (if the transferor or transferee is the Company). If the
transferor or transferee is a securities clearing institution (or its
attorney) recognised by the applicable listing rules or other relevant
securities laws and regulations, signed under hand or signed in printed
mechanical form. All the transfer instruments shall be maintained at the legal
address of the Company or another place as designated by the board of
directors.
All Overseas-Listed Foreign Shares listed in Hong Kong, which have been fully
paid-up, may be freely transferred in accordance with the Articles of
Association. However, unless such transfer complies with the following
requirements, the board of directors may refuse to recognise any instrument of
transfer and would not need to provide any reason therefore:
(1) a fee of HK$2.50 per instrument of transfer or such higher amount
agreed from time to time by the Stock Exchange for registration of the
instrument of transfer and other documents relating to the right of ownership
of the shares;
(2) the instrument of transfer only relates to Foreign-Listed Foreign
Shares listed in Hong Kong;
(3) the stamp duty which is chargeable on the instrument of transfer
has already been paid;
(4) the relevant share certificate(s) and any other evidence which the
board of directors may reasonably require to show that the transferor has the
right to transfer the shares have been provided;
(5) if it is intended that the shares be transferred to joint owners,
the maximum number of joint owners shall not be more than four (4);
(6) the Company does not have any lien on the relevant shares.
If the Company refuses to register a transfer of shares, the Company shall
issue to the transferor and transferee a notice regarding such decision within
2 months starting from the date of formal application for transfer of shares.
Article 41 Where provisions of laws, administrative regulations, other directives and the
relevant stock exchanges or regulatory authorities of the jurisdictions where
the shares of the Company are listed governing the period of closure of
register of members before convening the shareholders' meeting or the record
date for determining the distribution of dividends of the Company, such
requirements shall prevail.
Article 42 Any person aggrieved and claiming to be entitled to have his name (title)
entered in or removed from the register of shareholders may apply to a court
of competent jurisdiction for rectification of the register.
Article 43 Any person who is a registered shareholder or who claims to be entitled to
have his name (title) entered in the register of shareholders in respect of
shares in the Company may, if his share certificate (the "original
certificate") relating to the shares is lost, apply to the Company for a
replacement share certificate in respect of such shares (the "Relevant
Shares").
Application by a holder of A Shares, who has lost his share certificate, for a
replacement share certificate shall be dealt with in accordance with Article
164 of the Company Law.
Application by a holder of Overseas-Listed Foreign Shares, who has lost his
share certificate, for a replacement share certificate may be dealt with in
accordance with the law of the place where the original register of
shareholders of holders of Overseas-Listed Foreign Shares is maintained, the
rules of the stock exchange or other relevant regulations.
The issue of a replacement share certificate to a holder of H Shares, who has
lost his share certificate, shall comply with the following requirements:
(1) The applicant shall submit an application to the Company in a
prescribed form accompanied by a notarial certificate or a statutory
declaration, stating the grounds upon which the application is made, the
circumstances and evidence of the loss; and declaring that no other person is
entitled to have his name entered in the register of shareholders in respect
of the Relevant Shares.
(2) The Company has not received any declaration made by any person
other than the applicant declaring that his name shall be entered into the
register of shareholders in respect of such shares before it decides to issue
a replacement share certificate to the applicant.
(3) The Company shall, if it intends to issue a replacement share
certificate, publish a notice of its intention to do so at least once every
thirty (30) days within a period of ninety (90) consecutive days in such
newspapers as may be prescribed by the board of directors.
(4) The Company shall, prior to publication of its intention to issue
a replacement share certificate, deliver to the stock exchange on which its
shares are listed, a copy of the notice to be published and may publish the
notice upon receipt of confirmation from such stock exchange that the notice
has been exhibited in the premises of the stock exchange. Such notice shall be
exhibited in the premises of the stock exchange for a period of ninety (90)
days.
In the case of an application which is made without the consent of the
registered holders of the Relevant Shares by an applicant who is not a
registered shareholder of Relevant Shares and, the Company shall deliver by
mail to such registered shareholder a copy of the notice to be published.
(5) If, by the expiration of the 90-day period referred to in
paragraphs (3) and (4) of this Article, the Company has not have received any
objections from any person in respect of the issuance of the replacement share
certificate, it may issue a replacement share certificate to the applicant
pursuant to his application.
(6) Where the Company issues a replacement share certificate pursuant
to this Article, it shall forthwith cancel the original share certificate and
document the cancellation of the original share certificate and issuance of a
replacement share certificate in the register of shareholders accordingly.
(7) All expenses relating to the cancellation of an original share
certificate and the issuance of a replacement share certificate shall be borne
by the applicant and the Company is entitled to refuse to take any action
until reasonable security is provided by the applicant therefore.
CHAPTER 7: SHAREHOLDERS' RIGHTS AND OBLIGATIONS
Article 44 A shareholder of the Company is a person who lawfully holds shares in the
Company and whose name (title) is entered in the register of shareholders.
A shareholder shall enjoy rights and assume obligations according to the class
and amount of shares held by him; shareholders who hold shares of the same
class shall enjoy the same rights and assume the same obligations.
In the case of the joint shareholders, if one of the joint shareholders is
deceased, only the other existing shareholder of the joint shareholders shall
be deemed as the persons who have the ownership of the relevant shares. But
the board of directors has the power to require them to provide a certificate
of death as necessary for the purpose of modifying the register of
shareholders. Only the joint shareholders ranking first in the register of
shareholders have the right to accept certificates of the relevant shares,
receive notices of the Company, attend and vote at shareholders' meetings of
the Company. Any notice that is delivered to the aforesaid shareholder shall
be considered as delivered to all the joint shareholders of the relevant
shares.
Article 45 When the Company intends to convene a shareholders' meeting, distribute
dividends, liquidate and engage in other activities that involve determination
of shareholding, the board of directors or the convener of the shareholders'
meeting shall decide on a date for the record of shareholding. Shareholders
whose names are registered on the share register after the closing of the
market on such date shall be the Company's shareholders with the entitlement
to the relevant rights. Should the Articles of Association have contrary
requirements, the Company shall comply with such requirements.
Article 46 Holders of the ordinary shares of the Company shall enjoy the following
rights:
(1) the right to receive dividends and other distributions in
proportion to the number of shares held;
(2) the right to request to convene, convene, preside over, attend or
appoint a proxy to attend shareholders' meetings and to speak and vote thereat
in proportion to the number of shares in their possession pursuant to the
laws;
(3) the right of supervisory management over the Company's business
operations and the right to present proposals or to raise queries;
(4) the right to transfer, donate or pledge the shares in their
possession in accordance with laws, administrative regulations and provisions
of the Articles of Association;
(5) the right to inspect and copy the Articles of Association,
register of shareholders, minutes of shareholders' meetings, resolutions of
the board of directors, and financial and accounting report, shareholders who
meet the requirements may inspect the Company's accounting books and
accounting vouchers;
(6) in the event of the termination or liquidation of the Company, the
right to participate in the distribution of surplus assets of the Company in
accordance with the number of shares held;
(7) With respect to shareholders who vote against any resolution
adopted at the shareholders' meeting on the merger or demerger of the Company,
the right to request the Company to acquire their shares;
(8) other rights conferred by laws, administrative regulations,
departmental rules and regulations and the Articles of Association of the
Company.
Where shareholders request for inspection and duplication of the relevant
information or demand for materials as mentioned in the preceding paragraphs,
they shall comply with the requirements of laws and regulations including the
Company Law and the Articles of Association of the Company, and follow the
procedural requirements of the Company.
If shareholders who individually or aggregately hold more than 3 percent of
the Company's shares for more than 180 consecutive days request to inspect the
accounting books and accounting vouchers of the Company, they shall submit a
written request to the Company stating the purpose. If the Company has
reasonable grounds to believe that the shareholders' requests to inspect the
accounting books and accounting vouchers are made for improper purposes and
may impair the legitimate interests of the Company, it may reject the request
for inspection.
Shareholders and the accounting firm, law firm, or other intermediaries
retained by them shall comply with the provisions of laws and administrative
regulations on the protection of state secrets, trade secrets, personal
privacy and personal information when inspecting and duplicating the relevant
material.
Article 47 If the content of a resolution of the shareholders' meeting or the board of
directors of the Company violates the laws or administrative regulations, the
shareholders shall have the right to submit a petition to the People's Court
to render the same invalid.
If the procedures for convening or the method of voting at a shareholders'
meeting or meeting of the board of directors violate the laws, administrative
regulations or these Articles of Association, or the contents of a resolution
violate these Articles of Association, the shareholders shall have the right
to submit a petition to the People's Court to revoke the same within sixty
(60) days from the date on which such resolution is passed, unless there is
only a slight defect in the procedure of convening or the method of voting at
the shareholders' meeting or the meeting of the board of directors which has
no substantive impact on the resolution.
Where the board of directors, shareholders and other stakeholders have
disputes over the validity of a resolution of a shareholders' meeting, they
shall promptly file a lawsuit with the People's Court. Before the People's
Court makes a judgement or ruling, the stakeholders shall execute the
resolution of the shareholders' meeting. The Company, directors and senior
officers shall perform their duties diligently to ensure the normal operation
of the Company.
Where the People's Court makes a judgement or ruling on the relevant matter,
the Company shall fulfil its obligation to disclose information in accordance
with the laws, administrative regulations, and the requirements of the CSRC
and the stock exchanges to fully explain the impact, and actively co-operate
with the enforcement of the judgement or ruling after it has come into effect.
Where corrections to prior events are involved, they shall be handled in a
timely manner and the corresponding information disclosure obligations shall
be fulfilled.
Article 48 Any director or senior officer who, when performing their duties in the
Company, violates the laws, administrative regulations, or the provisions
contained in these Articles of Association resulting in causing losses to the
Company, the shareholders individually or jointly holding 1% or more of the
shares of the Company for 180 consecutive days or more shall have the right
pursuant to applicable laws, regulations and other normative documents to
request in writing the relevant bodies to initiate proceedings at a People's
Court. If the relevant bodies refuse to initiate proceedings, or fail to
initiate such proceedings, or in case of emergency where failure to initiate
such proceedings immediately will result in irreparable damage to the
Company's interests, the shareholders described in the preceding paragraph
shall have the right to initiate proceedings at a People's Court directly in
their own names in the interest of the Company.
If any person infringes the lawful rights and interests of the Company, thus
causing any losses to the Company, the shareholders described in the first
paragraph of this Article may initiate proceedings at a People's Court in
accordance with the provisions of the preceding two paragraphs.
Article 49 If any director or senior officer violates the laws, administrative
regulations or these Articles of Association resulting in causing harm to the
interests of the shareholders, the shareholders may initiate proceedings at a
People's Court.
Article 50 The ordinary shareholders of the Company shall assume the following
obligations:
(1) to comply with the Articles of Association;
(2) to pay subscription price according to the number of shares
subscribed and the method of subscription;
(3) unless otherwise provided for by the laws and regulations, not to
withdraw their share capital;
(4) not to abuse the rights of the shareholders to impair the
interests of the Company or other shareholders; not to abuse the independent
legal person status of the Company and the enjoyment of limited liabilities of
the shareholders to impair the Company's creditors interest. Should the
Company's shareholders abuse their shareholder's rights and cause losses to
the Company or other shareholders, the said shareholders shall be liable for
damages pursuant to the law. Should the Company's shareholders abuse the
Company's independent legal person status and the enjoyment of limited
liabilities of the shareholders to evade debt liabilities, resulting in
materially impairing the interests of the Company's creditors, the said
shareholders shall bear joint and several liabilities to the Company's debts;
(5) other obligations imposed by laws, administrative regulations and
the Articles of Association.
Shareholders are not liable to make any further contribution to the share
capital other than according to the terms which were agreed by the subscriber
of the relevant shares at the time of subscription.
Article 51 The controlling shareholders and de facto controller of the Company shall
exercise their rights and fulfil their obligations in accordance with laws,
administrative regulations, and the requirements of the CSRC and the stock
exchanges to safeguard the interests of the Company.
The controlling shareholders and de facto controller of the Company shall
comply with the following requirements:
(1) to exercise their rights as shareholders in accordance with the
law and not to abuse their control or use their related relationship to
prejudice the legitimate interests of the Company or other shareholders;
(2) to strictly fulfil their public statements and various
undertakings and not to change or waive such statements and undertakings;
(3) to fulfil their information disclosure obligations in strict
accordance with relevant regulations, proactively cooperate with the Company
in information disclosure and inform the Company in a timely manner of
material events that have occurred or are intended to occur;
(4) not to appropriate the Company's funds in any way;
(5) not to order, instruct, or request the Company and its relevant
personnel to provide guarantees in violation of laws and regulations;
(6) not to make use of the Company's undisclosed material information
to gain benefits, or disclose in any way undisclosed material information
relating to the Company, or engage in insider trading, short-term trading,
market manipulation or other illegal and unlawful acts;
(7) not to prejudice the legitimate interests of the Company and other
shareholders through unfair related transactions, profit distribution, asset
restructuring, external investment or any other means;
(8) to ensure the integrity of the Company's assets, and the
independence of its personnel, finance, organization and business, and not to
affect the independence of the Company in any way;
(9) to comply with laws, administrative regulations, and provisions of
the CSRC, listing rules of securities and other requirements of the Articles
of Association.
Where a controlling shareholder or de facto controller of the Company
instructs a director or senior officer to engage in an act that is detrimental
to the interests of the Company or its shareholders, it shall bear joint and
several liability with the director or senior officer.
Article 52 Where a controlling shareholder or de facto controller pledges the shares of
the Company that he/she holds or effectively controls, he/she shall maintain
control of the Company and the stability of its production and operation.
Where a controlling shareholder or de facto controller transfers the shares of
the Company held by him/her, he/she shall comply with the restrictive
provisions on the transfer of shares set out in laws, administrative
regulations, the regulations of the CSRC and stock exchanges, as well as its
undertakings in respect of restrictions on the transfer of shares.
CHAPTER 8: SHAREHOLDERS' MEETINGS
Article 53 The shareholders' meeting of the Company is composed of all shareholders. The
shareholders' meeting is the organ of authority of the Company, and shall
exercise the following functions and powers in accordance with laws:
(1) to elect and replace directors (excluding the employee
representative director) and to decide on matters relating to the remuneration
of directors;
(2) to examine and approve the board of directors' reports;
(3) to examine and approve the Company's profit distribution plans and
loss recovery plans;
(4) to decide on the increase or reduction of the Company's registered
capital;
(5) to decide on the issue of bonds by the Company;
(6) to decide on matters such as merger, division, dissolution,
liquidation or change of the form of the Company;
(7) to amend the Articles of Association of the Company;
(8) to decide on the appointment and dismissal of the accountants of
the Company which undertakes the audit work of the Company;
(9) to consider and approve external guarantee matters which should be
decided by the shareholders' meeting as stipulated by laws, administrative
regulations, other regulatory documents and the Articles of Association;
(10) to consider the material purchase and sale of assets in excess of 30
percent of the most recent audited total assets of the Company during the
year;
(11) to consider and approve the variation of use of proceeds;
(12) to consider the shares incentive program and employee share ownership
plan;
(13) to decide on other matters which, according to laws, administrative
regulations, other regulatory documents and the Articles of Association, need
to be approved by the shareholders' meeting.
Article 54 The shareholders' meeting may authorize the board of directors to resolve on
matters such as the issuance of Company's shares and bonds in accordance with
laws, administrative regulations, departmental rules and listing rules of
securities. If the shareholders' meeting authorizes the board of directors to
decide on the issuance of new shares, the board resolution must be approved by
more than two-thirds of all directors.
If the board of directors decides to issue shares under the authorization
which results in changes to the Company's registered capital or the number of
issued shares, the corresponding amendments to the Company's Articles of
Association do not need to be approved by the shareholders' meeting.
Article 55 Any matters in relation to the provision of guarantee in favour of third
parties by the Company shall be approved by the board of directors. The
following matters relating to the provision of guarantee shall be submitted to
the shareholders' meetings for examination and approval after the same have
been considered by the board of directors:
(1) Any guarantee to be provided by the Company and its controlling
subsidiaries, with the total amount of the guarantee provided in favour of
third parties that exceeds 50 percent of the most recent audited net assets;
(2) any guarantee provided by the Company in favour of third parties
with the total amount of the guarantee exceeds 30 percent of the most recent
audited total assets;
(3) any guarantee provided by the Company within one year with the
amount of guarantee exceeds 30 percent of the most recent audited total
assets;
(4) guarantees to be provided in favour of an entity which is subject
to a gearing ratio of over 70 percent;
(5) any single guarantee with an amount which exceeds 10 percent of
the most recent audited net asset value;
(6) guarantees to be provided in favour of any shareholder, person who
exercises effective control over the Company and its affiliates;
(7) matters relating to the provision of guarantee that need to be
submitted to the shareholders' meeting for examination and approval as
required by other laws and regulations and the Articles of Association of the
Company.
If a director or senior officer personnel commits any act in breach of the
provisions governing the authority in respect of the examination and approval
of, and the examination procedures in relation to, the provision of guarantee
in favour of a third party under the laws, administrative regulations or the
Articles of Association of the Company, which results in causing the Company
to suffer from loss, such director or senior officer personnel shall be liable
for indemnity and the Company may bring an action against the same in
accordance with the law.
Article 56 Save as otherwise provided in the laws, administrative regulations,
departmental rules and listing rules of securities, the duties and powers of
the shareholders' meeting shall not be exercised by the board of directors or
other institutions and individuals on its behalf by way of authorization. When
necessary or under reasonable circumstances, the shareholders' meeting may
authorize the board of directors to make a decision within its scope of
authorization granted at a shareholders' meeting on specific issues which are
related to matters to be resolved at the shareholders' meeting but cannot be
determined immediately at the shareholders' meeting.
With respect to granting authorization to the board of directors at the
shareholders' meeting, if a matter for authorization is the matter subject to
an ordinary resolution, such authorization shall be adopted by more than half
of the voting rights held by shareholders (including their agents) attending
the shareholders' meeting; if a matter for authorization is the matter subject
to special resolution, such authorization shall be adopted by more than
two-thirds (2/3) of the voting rights held by shareholders (including their
agents) attending the shareholders' meeting. The content of the scope of
authorization shall be clear and specific.
Article 57 Shareholders' meetings are divided into annual shareholders' meetings and
extraordinary shareholders' meetings. The annual shareholders' meetings shall
be convened once every year and shall be held within 6 months from the end of
the preceding financial year. Meeting venues shall be fixed for the
shareholders' meetings, and the shareholders' meetings shall be convened in
the on-site conference mode. The Company also provides online voting manner
and/or other electronic communication options for the convenience of
shareholders. Shareholders are deemed to be attending the shareholders'
meetings in the aforesaid manners and forms.
The Company shall convene an extraordinary shareholders' meeting within 2
months of the date of occurrence of any one of the following events:
(1) where the number of directors is less than the number stipulated
in the Company Law or two-thirds of the number specified in the Articles of
Association;
(2) where the unrecovered losses of the Company amount to one-third of
the total amount of its share capital;
(3) where shareholders who separately or jointly holds more than 10
percent of the total Company's shares make such request in writing;
(4) whenever the board of directors deems necessary;
(5) when the audit and risk management committee (the supervision
committee) proposes to convene such meeting;
(6) under other conditions as provided for by the laws, administrative
regulations, departmental rules and regulations or the Articles of
Association.
The shareholding mentioned in sub-paragraph (3) above shall be calculated from
the date on which a shareholder submits his/her request in writing.
Article 58 The board of directors shall convene a shareholders' meeting within the time
limit as stipulated by laws, regulations and the Articles of Association.
More than half of the independent directors, the audit and risk management
committee (the supervision committee) or shareholders who separately or
jointly hold shares of the Company in excess of 10 percent shall have the
right to propose to the board of directors and request for convening an
extraordinary shareholders' meeting. The following procedures shall be adopted
should the independent directors, the audit and risk management committee (the
supervision committee) and shareholders who separately or jointly hold shares
of the Company in excess of 10 percent propose to the board of directors and
request for convening of an extraordinary shareholders' meeting:
(1) Sign a copy, or several copies, of written request in the same
form and substance, and request the board of directors to convene a meeting,
with clearly stated topics for discussion at the meeting. Within 10 days of
receiving the aforesaid written request, the board of directors shall reply in
writing on whether or not they agree to convene the meeting.
(2) Should the board of directors agree to convene the meeting, a
notice for convening such meeting shall be issued within 5 days after the
board of directors has passed the resolution. Prior approval for making
amendment to the original proposal contained in the notice shall be obtained
from the original proposer.
(3) Should the board of directors not agree to convene the meeting as
proposed by the independent directors, it shall state its reasons and issue an
announcement of the same.
(4) Should the board of directors not agree to convene the meeting as
proposed by the audit and risk management committee (the supervision
committee), or not provide any reply within 10 days upon receipt of the said
request, the board of directors is deemed to be unable to perform or failed to
perform its duties in respect of convening such meeting. The audit and risk
management committee (the supervision committee) may convene and preside over
the meeting by itself. The procedures for convening such meeting shall be
identical to those employed by the board of directors for convening a meeting
as far as practicable.
(5) Should the board of directors not agree to convene the meeting as
proposed by the shareholders, or not provide any reply within 10 days upon
receipt of the said request, the shareholders shall propose to the audit and
risk management committee (the supervision committee) in writing to convene
the meeting.
Should the audit and risk management committee (the supervision committee)
agree to convene the meeting, it shall issue a notice for convening the
meeting within 5 days upon receipt of the said request. Prior approval for
making amendment to the original proposal contained in the notice shall be
obtained from the original proposer.
Should the audit and risk management committee (the supervision committee) not
issue a notice for the meeting within the stipulated period, the audit and
risk management committee (the supervision committee) shall be deemed to not
convene and preside over such meeting and shareholders who separately or
jointly hold 10 percent or more of the Company's shares for a consecutive 90
days or more may convene and preside over the said meeting themselves.
Should the audit and risk management committee (the supervision committee) or
the shareholders convene and hold a meeting by itself/themselves pursuant to
the preceding paragraphs, it/they shall inform the board of directors in
writing, and file the same with the relevant stock exchanges of the
jurisdictions where the shares are listed in accordance with the applicable
listing rules of securities. The audit and risk management committee (the
supervision committee) or the convening shareholders shall submit relevant
evidence to the stock exchanges upon the issuance of the notice of the
shareholders' meeting and the announcement of the resolutions of the
shareholders' meeting. Prior to the announcement of the resolutions of the
shareholders' meeting, the shareholding ratio of the convening shareholders
shall not be less than 10 percent.
The board of directors and the secretary to the board of directors shall
provide assistance in connection with the shareholders' meeting convened by
the audit and risk management committee (the supervision committee) or the
convening shareholders on their own. The board of directors shall provide the
share register. The Company shall bear all reasonable costs incurred by the
meeting.
Article 59 Where the Company convenes a shareholders' meeting, the board of directors,
the audit and risk management committee (the supervision committee) and
shareholders who separately or jointly hold 1 percent or more of the shares of
the Company may submit proposals to the Company.
Shareholders who hold, separately or jointly, more than 1 percent of the
Company's shares can propose an extraordinary resolution in writing to the
convenor 10 days prior to the shareholders' meeting. Within 2 days after the
receipt of the extraordinary resolution, the convenor shall issue a
supplementary notice of the shareholders' meeting to announce the content of
the extraordinary resolution, and submit the same to the shareholders' meeting
for consideration, unless the extraordinary resolution violates the laws,
administrative regulations or provisions of the Articles of Association, or
does not fall within the terms of reference of the shareholders' meeting. If
it is otherwise provided for under the listing rules of securities, such
requirements shall also be complied with.
With the exception of conditions mentioned above, the convener shall neither
amend the proposals specified on the notice of the shareholders' meeting, nor
add any new proposals after the issuance of the notice of the shareholders'
meeting.
Article 60 Matters for discussion and determination at a shareholder's meeting shall be
determined in accordance with the scope of authority of the shareholders'
meeting as prescribed under the laws, administrative regulations and the
Articles of Association.
Issues not specified in the notice as provided for in Article 62 and Article
59 of the Articles of Association or proposals which do not conform with the
requirements contained in Article 61 of the Articles of Association shall not
be voted and resolved at the shareholders' meetings.
Article 61 Motions tabled at the shareholders' meeting shall be the specific proposals
relating to matters which should be discussed at shareholders' meeting.
Motions tabled at a shareholders' meeting shall fulfil the following
conditions:
(1) the content of such motions shall not contravene the requirements
stipulated in the laws and regulations as well as in the Articles of
Association and shall fall within the scope of business of the Company and
within the functions and powers of the shareholders' meeting;
(2) there shall also have a clear topic for discussion and specific
issues for resolution;
(3) all motions shall be presented to or served on the convenor in
writing.
Article 62 Where the Company convenes an annual shareholders' meeting, a written notice
of the meeting shall be given to the shareholders entitled to attend this
shareholders' meeting 20 days prior to the date of the meeting. Where the
Company convenes an extraordinary shareholders' meeting, a written notice of
the meeting shall be given to the shareholders entitled to attend this
shareholders' meeting 15 days prior to the date of the meeting.
If it is otherwise provided in the laws, administrative regulations, other
regulatory documents and the securities regulatory authorities or stock
exchanges in the jurisdictions where the shares of the Company are listed,
such requirements shall prevail.
Article 63 The notice of a shareholder's meeting shall include the following information:
(1) the time, the venue and the duration of the meeting;
(2) matters and proposals submitted to the meeting for consideration;
(3) contain a conspicuous statement that: all shareholders are
entitled to attend the shareholders' meeting, and may appoint proxies in
writing to attend the meeting and vote on their behalf. A proxy need not be a
shareholder of the Company;
(4) the record date of shareholding for determining the entitlement of
shareholders to attend the shareholders' meeting;
(5) the name and telephone number of the standing contact person for
meeting affairs;
(6) the voting time and voting procedures for online voting or other
means of voting.
Article 64 In the event that the election of directors is to be discussed at a
shareholders' meeting, the notice of the shareholders' meeting shall fully
disclose the details of candidates for the directors in accordance with the
relevant requirements.
Article 65 Notice of shareholders' meeting shall be served on the shareholders (whether
or not such shareholder is entitled to vote at the shareholders' meeting), by
way of announcement or other ways provided in Article 215. Where a notice is
served by way of announcement, upon the publication of such announcement, all
relevant persons shall be deemed to have received the notice.
Article 66 When notice of a shareholders' meeting is dispatched, the shareholders'
meeting shall not be postponed or cancelled without proper reasons and the
proposals stated in the notice of the shareholders' meeting shall not be
cancelled. In the event that the shareholders' meeting is postponed or
cancelled, the convener shall make an announcement at least two business days
prior to the originally scheduled date of convening the shareholders' meeting
and expatiate on the reasons.
Article 67 All ordinary shareholders registered on the record date of shareholding or
their proxies shall be entitled to attend the shareholders' meeting and
exercise their voting rights in accordance with the relevant laws, regulations
and these Articles of Association.
Article 68 Shareholders may attend the shareholders' meeting in person or appoint a proxy
(whether or not such person is a shareholder) to attend and vote on their
behalf.
If the shareholder is the recognized clearing house defined by the applicable
listing rules or other securities laws and regulations, such shareholder is
entitled to appoint one or more persons as his proxies to attend on his behalf
at a shareholders' meeting, but, if one or more persons have such authority,
the letter of authorization shall contain the number and class of the shares
in connection with such authorization. Such person can exercise rights
equivalent to the rights of other shareholders of the Company on behalf of the
recognized clearing house (or its attorney), including the right to speak and
to vote.
Article 69 The instrument appointing a proxy shall be in writing under the hand of the
appointor or his attorney duly authorized in writing, or if the appointor is a
legal entity, either under seal or under the hand of a director or a duly
authorized attorney. The letter of authorization shall contain the number of
the shares to be represented by the attorney. The letter of authorization
shall specify the number of shares to be represented by the attorney. If
several persons are authorized as the attorney of the shareholder, the letter
of authorization shall specify the number of shares to be represented by each
attorney.
Article 70 If the instrument appointing a voting proxy is signed by a person under a
power of attorney on behalf of the appointor, such power of attorney or other
authority shall be notarially certified. A notary certified copy of that power
of attorney or other authority shall, together with the instrument appointing
the voting proxy, be deposited at the premises of the Company or at such other
place as is specified for that purpose in the notice convening the meeting.
If the appointor is a legal person, its legal representative or such person as
is authorized by resolution of its board of directors or other governing body
may attend any meeting of shareholders of the Company as a representative of
the appointor.
Article 71 The authorization letter issued by shareholders to appoint other persons to
attend the shareholders' meeting shall clearly state the followings:
(1) the name of the principal and the class and number of the shares
of the Company held by him/her;
(2) the name of the proxy;
(3) the specific instruction of the shareholder, including the
directive to vote "for", "against" or "abstain" for each resolution in the
agenda of the shareholders' meeting;
(4) date of signing the proxy form and the effective period;
(5) signature (or seal) of the principal. If the principal is a
corporate shareholder, the seal of the corporate shall be affixed.
Such a form shall contain a statement that, in the absence of specific
instructions from the shareholder, specifies whether the proxy may vote as he
thinks fit.
Article 72 If an individual shareholder attends the meeting in person, he/she shall
present his/her identity card or other valid documents or certificates showing
his/her identity. A proxy attending the meeting shall present his/her own
identification documents and the shareholders' power of attorney.
Legal person shareholders shall be represented at the meeting by the legal
representative or the proxy appointed by the legal representative. If the
legal representative attends the meeting, he/she shall present his/her
identity card and a valid certificate proving his/her qualification as a legal
representative. The proxy attending the meeting shall present his/her own
identification documents and the power of attorney in written form issued by
the legal representative of the legal person shareholders in accordance with
laws. If a person is authorized by resolution to attend the shareholders'
meeting upon resolutions at the board of directors of a legal person
shareholder or other decision making authority, such person shall present
his/her own identification documents and the written authorization issued upon
resolution by the board of directors of the legal person shareholder or other
decision making authority with the legal person seal affixed thereon.
Article 73 The Company's board of directors, independent directors, shareholders who hold
1 percent or more of shares with voting rights or investor protection
institutions established in accordance with laws and regulations may solicit
voting rights from shareholders publicly. Information including the specific
voting intention shall be fully disclosed to the shareholders from whom the
voting rights are being solicited. Consideration or de facto consideration for
soliciting shareholders' voting rights is prohibited. Except for statutory
conditions, the Company shall not impose any minimum shareholding limitation
for soliciting voting rights.
Article 74 The Chairman of the board of directors shall preside over and chair every
shareholders' meeting. If the Chairman is unable to or does not perform
his/her duties, the vice-chairman of the board of directors shall preside over
and chair the meeting. If the vice-chairman of the board of directors is
unable to or does not perform his/her duties, a director jointly elected by
more than half of the number of directors shall preside over and chair the
meeting. If more than half of the number of directors are unable to elect a
director to preside over and chair the meeting, then shareholders attending
the meeting may elect one (1) person to act as the chairman of the meeting. If
for any reason, the shareholders fail to elect a chairman, then the
shareholder (including a proxy) holding the largest number of shares carrying
the right to vote thereat shall be the chairman of the meeting.
A shareholders' meeting convened by the audit and risk management committee
(the supervision committee) on their own shall be presided by the convenor of
the audit and risk management committee (the supervision committee). If the
convenor of the audit and risk management committee (the supervision
committee) is unable to or does not perform his/her duties, a member of the
audit and risk management committee (the supervision committee) jointly
elected by more than half of the members of the audit and risk management
committee (the supervision committee) shall preside over the said meeting.
Where the shareholders' meeting is convened by the shareholders on their own,
the convener shall elect a representative to preside over the meeting.
When convening a shareholders' meeting, should the chairman of the meeting
violates the rules and procedures, resulting that the shareholders' meeting
becomes unable to proceed, a person may, subject to the consent of more than
half of the number of shareholders with voting rights attending the meeting at
the scene, be elected at the shareholders' meeting to act as the chairman of
the shareholders' meeting such that the meeting may be continued.
Article 75 At the annual shareholders' meeting, the board of directors shall report to
the shareholders' meeting on their respective work over the past year.
Article 76 Prior to voting, the chairman of the meeting shall announce the number of
shareholders and proxies attending the meeting and the total number of voting
shares held by them. The number of shareholders and proxies attending the
meeting and the total number of voting shares held by them shall be subject to
registration of the meeting.
Article 77 The convener shall ensure that the shareholders' meeting is held continuously
until a final resolution is formed. If the shareholders' meeting is suspended
or no resolution can be made due to force majeure and other special reasons,
necessary measures shall be taken to resume the shareholders' meeting as soon
as possible or to terminate this shareholders' meeting directly, and an
announcement shall be made promptly. At the same time, the convener shall
report to the local office of the CSRC and the stock exchange in the locality
of the Company.
Article 78 Resolutions of shareholders' meetings shall be divided into
ordinary resolutions and special resolutions.
An ordinary resolution must be passed by votes representing more than half of
the voting rights represented by the shareholders (including proxies)
attending the shareholders' meeting.
A special resolution must be passed by votes representing more than two-thirds
of the voting rights represented by the shareholders (including proxies)
attending the shareholders' meeting.
Article 79 A shareholder (including a proxy), when voting at a shareholders' meeting, may
exercise such voting rights as are attached to the number of voting shares
which he represents. Except provided for the election of directors in laws,
administrative regulations and the Articles of Association in connection with
the adoption of the cumulative voting system, each share shall have one (1)
vote.
Where material issues affecting the interests of small and medium investors
are being considered in the shareholders' meeting, the votes by small and
medium investors shall be counted separately. The separate counting results
shall be disclosed to the public in a timely manner.
The shares held by the Company itself shall have no voting rights and shall
not be counted towards the total number of voting shares attending the
shareholders' meeting.
If a shareholder buys voting shares of the Company in violation of the
provisions of Article 63 (1) and (2) of the Securities Law, such shares in
excess of the prescribed proportion are not entitled to exercise voting rights
for a period of thirty-six (36) months after the purchase, and shall not be
counted towards the total number of voting shares attending the shareholders'
meeting.
Article 80 In the course of considering matters relating to connected transactions at a
shareholders' meeting, the connected shareholders shall abstain from voting.
The number of shares carrying the voting rights held by such shareholders
shall be excluded from the total number of valid votes. The voting result of
the non-connected shareholders shall be fully disclosed in the announcement of
the resolution of the shareholders' meeting.
The said connected shareholders means the following shareholders: shareholders
who are connected parties or, in case of non-connected parties, persons who
have material interests in transactions pending for resolution or their
associates pursuant to the applicable securities listing rules as amended from
time to time.
Article 81 Unless the Company is in a crisis or other special circumstances, it shall
not, without approval by a special resolution at a shareholders' meeting,
enter into a contract to handover all or material business management of the
Company to a person other than a director or senior officer.
Article 82 Except for the cumulative voting system, the shareholders' meeting shall vote
on all proposals one by one, and if there are different proposals on the same
matter, they shall be voted in chronological order in which the proposals are
made. Except for force majeure and other special reasons that cause the
shareholders' meeting to be suspended or unable to come to resolution, the
shareholders' meeting shall not set aside the proposals or withhold from
voting.
Article 83 When a proposal is considered at a shareholders' meeting, no amendment shall
be made to the proposal, otherwise, the relevant change shall be regarded as a
new proposal and cannot be voted on at this shareholders' meeting.
Article 84 Each voting right shall be exercised either at the meeting, by online voting
or any of other available means. In case of repeated voting on the same voting
right, the result of the first vote shall prevail.
Article 85 Before voting takes place on a proposal at a shareholders' meeting, two
shareholders' representatives shall be elected to participate in vote counting
and scrutinizing. In the event that a shareholder is related to the matter to
be considered, the relevant shareholder and his/her proxy shall not
participate in the vote counting and scrutinizing.
When voting takes place on a proposal at a shareholders' meeting, lawyers and
representatives of shareholders shall be jointly responsible for vote counting
and scrutinizing, and shall announce the voting results on the spot. The
voting results of resolutions shall be recorded in the minutes.
The shareholders of the Company or their proxies who cast votes by online
voting or other means shall be entitled to check their respective voting
results through corresponding voting systems.
Article 86 A shareholders' meeting shall not conclude earlier at the venue than over the
network or otherwise. The chairman of the meeting shall announce the voting
details and result of every proposal and announce whether a proposal has been
passed or not based on the voting result.
Before the voting result is officially announced, the relevant parties
including the Company, counting officer, monitoring officer, substantial
shareholders and network service provider involved at the venue of the
shareholders' meeting, over the network or otherwise shall be obliged to keep
the voting details confidential.
Article 87 A shareholder attending the shareholders' meeting shall express its opinion of
"for", "against" or "abstain" on the proposal submitted for voting, except
that securities registration and settlement institutions, being the nominal
holders of shares that can be traded through the mutual stock market access
between the Mainland and Hong Kong, may make declarations according to the
intention of actual holders.
Where a shareholder is, under the applicable listing rules as amended from
time to time, required to abstain from voting on any particular resolution or
to vote only for or only against any particular resolution, any votes cast by
or on behalf of such shareholder in contravention of such requirement or
restriction shall not be counted.
Votes that are not filled in, incorrectly filled in, or not legible, or votes
that are not cast are considered to be abstention by the voter, and the result
of the vote on the number of shares held by such voter shall be counted as
"abstained".
Article 88 The following matters shall be resolved by an ordinary resolution at a
shareholders' meeting:
(1) work reports of the board of directors;
(2) profit distribution plans and loss recovery plans formulated by
the board of directors;
(3) election or removal of members of the board of directors, their
remuneration and manner of payment;
(4) matters other than those which are required by the laws and
administrative regulations or by the Company's Articles of Association to be
adopted by special resolution.
Article 89 The following matters shall be resolved by a special resolution at a
shareholders' meeting:
(1) the increase or reduction in registered capital of the Company;
(2) the demerger, spin-off, merger, dissolution and liquidation of the
Company;
(3) amendment of the Articles of Association;
(4) the material purchase or sale of assets or the provision of
guarantee by the Company during the year that is in excess of 30 percent of
the most recent audited total assets value of the Company;
(5) the shares incentive program;
(6) any other matter as provided for by the laws, administrative
regulations or the Articles of Association, and as determined at a
shareholders' meeting by way of an ordinary resolution to have a material
impact on the Company and should be adopted by special resolution.
Article 90 Any resolution adopted by a shareholders' meeting shall comply with relevant
provisions of PRC laws, administrative regulations and these Articles of
Association.
Article 91 The Company shall make a public announcement on the resolutions of the
shareholders' meeting in accordance with the applicable laws and the relevant
provisions stipulated by the stock exchange(s) on which the shares of the
Company are listed and traded.
Article 92 If the chairman of the meeting has any doubt as to the result of a resolution
which has been put to vote at a shareholders' meeting, he/she may organize a
vote count. If the chairman of the meeting has not counted the votes, any
shareholder who is attending in person or by proxy and who objects to the
result announced by the chairman of the meeting may, immediately after the
declaration of the result, demand that the votes be counted and the chairman
of the meeting shall have the votes counted immediately.
Article 93 If votes are counted at a shareholders' meeting, the result of the count shall
be recorded in the minute book.
The convenor shall ensure that the particulars included in the record of the
meeting are true, accurate and complete. The directors, secretary to the
board, convenor or their representatives and the chairman of the meeting who
have attended or observed the meeting shall sign the record of the meeting.
Resolutions adopted by a shareholders' meeting shall be included in the record
of the meeting. The record of the meeting shall be in Chinese. Such record
shall be kept together with the attendance lists of shareholders attending the
meeting, proxy forms as well as valid information on the results of voting
online or by other means (if any) for a period of not less than 10 years.
Article 94 For any resolutions on the distribution of cash or share dividends or
conversion of capital reserve into share capital adopted at the shareholders'
meeting, the specific proposal shall be implemented by the Company within two
(2) months after the conclusion of the shareholders' meeting.
CHAPTER 9: THE PARTY COMMITTEE
Article 95 According to the requirements of the Constitution of the Communist Party of
China and subject to the approval by upper Party organization, the Company
shall establish the Chinese Communist Party Committee of Air China Limited.
The Party Committee is comprised of one secretary and several other members.
The Company shall establish discipline inspection and supervision bodies in
accordance with the requirements.
Article 96 The Party Committee of the Company shall play a leading role, set the right
direction, keep in mind the big picture, ensure the implementation of Party
policies and principles, discuss and decide on major issues of the Company in
accordance with the regulations. The list of major operation and management
matters shall be established in accordance with relevant regulations.
Decisions relating to major operation and management matters shall be made in
accordance with the functions and powers and the required procedures of the
board of directors after the pre-study and discussion by the Party Committee.
The main duties of the Party Committee are as follows:
(1) to enhance the political building of the Party in the Company,
adhere to and implement the fundamental system, basic system and important
system of socialism with Chinese characteristics, educate and guide all Party
members to closely align with the Party Central Committee with Comrade Xi
Jinping at its core in terms of political stance, direction, principles and
path;
(2) to thoroughly study and implement Xi Jinping Thought on Socialism
with Chinese Characteristics for a New Era, study and propagate the Party's
theory, thoroughly implement the Party's line, principles and policies,
supervise and guarantee the implementation of major strategy deployments of
the Party Central Committee and the resolutions of the Party organization at a
higher level in the Company;
(3) to investigate and discuss major issues relating to the operation
and management of the Company and support the shareholders' meeting, board of
directors and the management in exercising their powers and performing their
duties in accordance with the laws;
(4) to strengthen the leadership and gatekeeping role in the process
of selection and appointment of personnel of the Company, and enhance the
building of the leadership team, the cadre team and the talent team of the
Company;
(5) to undertake the main responsibility in improving Party conduct
and upholding integrity, support and cooperate with the work of the discipline
inspection and supervision bodies as well as exercise strict administrative
discipline and political rules and promote Party self-governance exercised
fully and with right into the grassroots level;
(6) to strengthen the building of primary- level Party organizations
and of its contingent of Party members, unite and lead employees to devote
themselves into the reform and development of the Company;
(7) to lead the Company's ideological and political work, the spirit
and civilization progress, the United Front work and lead the mass
organizations such as the Labour Union, the Communist Youth League and the
Women's Organization of the Company;
(8) to discuss and decide on other material matters within the scope
of duties of the Party Committee.
Article 97 By insisting on and improving the leadership mechanism of "Dual Entry and
Cross Appointment", eligible members of the Party Committee may take seats in
the board of directors and the management through statutory procedures, while
eligible members of the board of directors and the management who are also
Party members may take seats in the Party Committee in accordance with
relevant requirements and procedures.
Generally, the position of the secretary of the Party Committee and the
chairman of the board of directors shall be assumed by the same person. The
president who is a Party member shall serve as the deputy secretary of the
Party Committee. The full-time deputy secretary should generally take seat in
the board of directors and hold no positions in the management.
CHAPTER 10: BOARD OF DIRECTORS
Article 98 The Company shall have a board of directors. The board of directors shall
consist of 7 to 13 directors, at least half of which shall be outside
directors (those who do not assume any position within the Company), and of
which at least 1/3 of the overall directors shall be independent directors. At
least one independent director shall have appropriate professional
qualification prescribed by the securities regulatory authority and the
listing rules of securities, or expertise in accounting or related financial
management; the board of directors shall have one (1) employee representative
director.
The board of directors shall have one (1) Chairman and one (1) Deputy
Chairman.
An independent director refers to a director who does not hold any position
other than a director in the Company and has no direct or indirect interest
relationship with the Company, its substantial shareholders and de facto
controllers, or any other relationship that may affect his independent and
objective judgment.
Article 99 Directors (excluding the employee representative director) shall be elected or
replaced at the shareholders' meeting and the employee representative director
shall be elected or dismissed by the employee representative meeting each for
a term of 3 years (starting from the election date to the date on which a new
board of directors is elected at a shareholders' meeting). At the expiry of a
director's term, the term is renewable upon re-election, provided that the
term of reappointment of an independent director shall not be more than 6
years.
If the term of office of a director expires but re-election is not made
promptly, the said director shall continue fulfilling the duties as director
pursuant to relevant laws, administrative regulations, departmental rules and
the Articles of Association until a new director is elected.
The list of candidates for the director (excluding the employee representative
director) shall be submitted in form of a motion to a shareholders' meeting
for consideration. Candidates for director shall be nominated by the board of
directors or shareholder(s) holding, alone or together, more than one percent
(1%) of the total amount of voting shares in the Company and elected at the
shareholders' meeting.
The outside directors shall have sufficient time and necessary knowledge and
ability to perform its duties. When an outside director performs his duties,
the Company must provide necessary information and independent directors may
directly report to the shareholders' meeting, the CSRC and other relevant
departments thereon.
If a director is a natural person, he or she may not be required to hold
shares in the Company.
Article 100 The following procedures shall be carried out prior to the election of the
non- independent directors:
(1) The nominator of a candidate for the non-independent directors shall
seek the consent of such candidate prior to nomination and shall have a full
understanding towards the profession, education, job position, detailed
working experience and all other positions held concurrently as well as
preparing written materials containing the said information to the Company.
Candidates shall undertake to the Company in writing that they have agreed to
accept the nomination and that all disclosed information relating to them are
true and complete and shall guarantee that they will conscientiously perform
the director's responsibilities after being elected.
(2) If the nomination of a candidate for the non-independent directors
is taken place before the board meeting of the Company was convened and if the
applicable laws, regulations, other regulatory documents and/or the relevant
regulatory authorities of the jurisdictions where the shares are listed and
the listing rules of securities contain relevant provisions, the written
materials concerning the nominee set out in sub-paragraph (1) of this Article
shall be publicly announced together with the resolutions of the board meeting
in accordance with such provisions.
(3) If a shareholder holding, alone or together, more than one percent
(1%) of the total voting shares of the Company proposes an ex tempore motion
on the election of non-independent directors (excluding the employee
representative director) at the shareholders' meeting of the Company, the
written notice specifying the intention to propose a person for election as a
director and the willingness of the nominee to accept nomination together with
the written materials and undertakings containing such particulars of the
nominee as set out in sub-paragraph (1) of this Article shall be despatched to
the Company within ten (10) days prior to the shareholders' meeting. Such
notice shall commence no earlier than the day after the despatch of the notice
of the meeting for election of directors and end no later than seven (7) days
prior to the date of such meeting.
Article 101 At a shareholders' meeting, the cumulative voting system shall be adopted for
voting on the motions for election of directors (excluding the employee
representative director). In other words, when electing directors at a
shareholders' meeting, the number of voting rights carried by each of the
shares held by a voting shareholder is the same as the number of directors to
be elected such that a shareholder may exercise the voting rights in a way to
concentrate all his votes on a particular candidate or to spread his votes on
several candidates.
Article 102 The Chairman and the deputy Chairmen shall be elected and removed by more than
one-half of all members of the board of directors. The term of office of each
of the Chairman and the deputy chairmen shall be 3 years, which term is
renewable upon re-election.
Article 103 The board of directors shall make inquiries with the Party committee before
making decisions on major issues of the Company.
Article 104 The board of directors undertakes the functions of formulating strategies,
making decisions and preventing risks and shall exercise the following duties
and powers in accordance with statutory procedures and the Articles of
Association:
(1) to convene the shareholders' meeting and to report on its work to
the shareholders' meetings;
(2) to implement the resolutions passed by the shareholders' meetings;
(3) to determine the development strategy and planning of the Company;
(4) to determine the Company's business plans and investment
proposals;
(5) to determine the Company's preliminary and final annual financial
budgets;
(6) to formulate the Company's profit distribution proposal and loss
recovery proposal;
(7) to formulate proposals for the increase or reduction of the
Company's registered capital, the issuance and listing of the debentures or
other securities;
(8) to draw up the proposals for major acquisitions of the Company,
acquisition of the shares of the Company or merger, division, dissolution and
change of the form of the Company;
(9) to decide on other issues relating to the provision of guarantee
in favor of a third party other than those must be approved at a shareholders'
meeting pursuant to the laws, regulations, other regulatory documents and
these Articles of Association;
(10) to decide on the external investments, purchase and sale of assets,
creation of mortgage over assets, entrusted asset management, connected
transactions, external donations and other matters within the scope of
authorization conferred by the shareholders' meeting;
(11) to decide on the Company's internal management structure and the
establishment and cancellation of major branches and subsidiaries;
(12) to decide on the appointment or dismissal of the president of the
Company, secretary to the board of directors and other senior officers,
conduct appraisal on their performance and determine remunerations, rewards
and punishments; and to appoint or dismiss, with reference to the nomination
by the president, the vice presidents, chief accountant, chief pilot, general
legal counsel and other senior officers, conduct appraisal on their
performance and determine remunerations, rewards and punishments;
(13) to formulate the basic management structure of the Company;
(14) to manage matters relating to the disclosure of information by the
Company;
(15) to decide on major accounting policies and plans of change in
accounting estimates of the Company;
(16) to make recommendations to the shareholders' meetings on the
appointment or change of the accounting firm which performs the audit work for
the Company;
(17) to hear from the Company's president reports on work performed and to
inspect the work of the president;
(18) to formulate proposals for any amendment of the Company's Articles of
Association;
(19) to decide on proposals for major income distribution of the Company,
determine the major matters in relation to employee income distribution;
(20) to establish and improve the internal supervision, management and
risk control system, enhance internal compliance management, determine the
risk management system, the internal control system, the accountability system
for non-compliance operation and investment and the compliance management
system of the Company, and monitor and evaluate the risk management, internal
control and legal compliance management systems of the Company and their
effective implementation as a whole;
(21) to guide, inspect and assess the internal audit works of the Company,
and review and approve the annual audit plan and important audit reports;
(22) to consider the plans for addressing the Company's major litigation,
arbitration and other legal affairs;
(23) to exercise any other powers stipulated by laws, regulations, other
regulatory documents and these Articles of Association and conferred by the
shareholders' meetings.
Saved as otherwise provided by the laws, administrative regulations and the
Articles of Association, resolutions by the board of directors on the matters
referred to in the preceding paragraphs shall be passed by the affirmative
vote of more than half of all of the directors with the exception of
resolutions to formulate the proposals on the increase or reduction of the
Company's registered capital and the proposals on the issuance of corporate
bonds, and the resolutions to formulate the plans for merger, division and
dissolution of the Company and to formulate the proposals for the amendment to
the Articles of Association, which shall require the affirmative vote of at
least two-thirds of all of the directors for adoption.
If any director is connected with the enterprises or individuals that are
involved in the matters to be resolved by the board meetings, he/she shall
promptly report in writing to the board of directors. The director who has a
related relationship shall not exercise his voting rights for such matters,
nor shall he exercise voting rights on behalf of other directors. Such board
meetings shall be convened by a majority of the directors attending thereat
who are not connected. Resolutions made by the board meetings shall be passed
by a majority of the directors that are not connected. The aforementioned
matters that must be passed by two-thirds or more of the directors shall be
passed by votes of two-thirds or more of the directors that are not connected.
If the number of non-connected directors attending the board meetings falls
short of three, such matters shall be submitted to the shareholders' meeting
of the Company for approval.
Article 105 The Chairman of the board of directors and the president may exercise part of
the functions and powers of the board of directors upon authorization by the
board of directors. The authorization by the board of directors and the
exercise of the authorized functions and powers by the authorized person shall
comply with the relevant regulations of the Measures for Authorization
Management, which is formulated by the board of directors.
Article 106 The board of directors shall not, without the prior approval of shareholders'
meeting, dispose of or agree to dispose of any fixed assets of the Company
where the estimated value of the consideration for the proposed disposal and
the value of the consideration for any such disposal of any fixed assets of
the Company that has been completed in the period of 4 months immediately
preceding the proposed disposal, on an aggregate basis exceeds 33 percent of
the value of the Company's fixed assets as shown in the latest balance sheet
which was considered at a shareholders' meeting.
For the purposes of this Article, "disposition" includes an act involving the
transfer of an interest in assets but does not include the usage of fixed
assets for the provision of security.
The validity of a disposition by the Company shall not be affected by any
breach of the first paragraph of this Article.
Before the board of directors makes a decision on market development, merger
and acquisition, investment in new areas, etc., in relation to projects
involving investment or acquisition or merger exceeding a certain proportion
(to be determined by shareholders' meeting) of the total assets of the
Company, an independent consulting agency shall be engaged to provide
professional opinions which shall be an important basis of the decisions of
the board of directors.
Article 107 Unless otherwise provided for in the laws, regulations, other regulatory
documents and/or the relevant requirements of regulatory authorities of the
jurisdictions where the shares are listed and the listing rules of securities,
the board of directors shall, within the scope of authority as conferred by
the shareholders' meeting, have the right to decide on an investment
(including risk investment) or acquisition project. For any major investment
or acquisition project which is beyond the limits of authority of the board of
directors to examine and approve thereof, the board of directors shall
organize the relevant experts and professionals to conduct an evaluation
thereof and report the same to the shareholders' meeting for approval.
Article 108 The Chairman of the board of directors shall exercise the following powers:
(1) to preside over shareholders' meetings and to convene and preside
over meetings of the board of directors;
(2) to convey the spirit of the Central Committee and state-owned
assets supervision policies to the board of directors, and to inform the board
of the tasks requiring the board's advancement and implementation as well as
the issues requiring rectification as identified in relevant supervision and
inspection;
(3) to oversee and check on the implementation of resolutions passed
by the board of directors at directors' meetings;
(4) to receive reports on operation and management and study related
issues;
(5) in the event of emergency due to force majeure or major crisis
that makes it impossible to convene a board meeting in a timely manner, to
exercise special disposal powers within the authority of the board of
directors in accordance with laws and regulations and in the interests of the
Company, and to report to the board of directors after exercising such power
so as to ratify the same in accordance with the procedures;
(6) to exercise other powers prescribed by the state-owned assets
supervision and administration authority of the State Council, the CSRC and
the stock exchanges or those conferred by the board of directors.
The vice chairman of the board of directors shall assist the chairman of the
board of directors with his/her duties. Should the chairman of the board of
directors be unable to perform or fail to perform his/her duties, the vice
chairman of the board of directors shall perform the said duties. Should the
vice chairman of the board of directors be unable to perform or fail to
perform his/her duties, a director jointly elected by more than half of the
number of Directors shall perform the said duties.
Article 109 Meetings of the board of directors shall be held at least four times every
year and shall be convened by the Chairman of the board of directors. All
directors shall be notified of the meeting fourteen days beforehand. The
notice of the board meetings shall contain:
(1) date, venue and duration of the meeting;
(2) reasons and matters for discussion;
(3) date of issuance of the notice.
Extraordinary meeting of the board of directors shall be convened by the
Chairman within ten days of the occurrence of any of the following events and
shall not be subject to the abovementioned period of notice:
(1) where shareholders representing more than 10 percent of the voting
rights propose to do so;
(2) where the chairman of the board of directors deems it necessary;
(3) where one-third or more of the directors jointly propose to do so;
(4) where one half or more of the independent directors jointly
propose to do so;
(5) where the audit and risk management committee (the supervision
committee) proposes to do so;
(6) where the president proposes to do so;
(7) where the securities regulatory authority requires to do so; and
(8) where other circumstances specified in the Articles of Association
of the Company occur.
The meetings of the board of directors shall be conducted in Chinese and where
necessary, may have an interpreter to provide Chinese and English translation
during the meetings.
Article 110 The notice of board meeting shall be issued via the following methods:
(1) For periodic meetings of the board of directors of which the time
and venue have been stipulated by the board of directors beforehand, no notice
of the convening of such meetings will be needed.
(2) For meetings of the board of directors of which the time, venue
and agenda have not been decided by the board of directors beforehand, the
secretary of the board of directors shall notify the directors of the time and
venue of such meeting at least 14 days in advance by telex, by telegram, by
facsimile, by express service or by registered mail or in person or by email,
unless otherwise provided for in Article 109 herein.
(3) Notice of meetings may be served in Chinese, with an English
translation attached thereto when necessary. A director may waive his right to
receive notice of a board meeting.
Article 111 All directors must be notified about the important matters that shall be
decided by the board of directors within the time limit stipulated in Article
110 of these Articles of Association and sufficient materials shall be
provided at the same time in strict compliance with the required procedures.
Directors may request for supplementary information. If more than one-fourth
of the directors or more than two outside directors consider that the
materials provided are not sufficient or supporting arguments are not clear,
they may jointly propose to postpone the board meeting or postpone the
discussion of certain matters on the agenda of the board meeting and the board
of directors shall accept such proposal.
Notice of a meeting shall be deemed to have been given to any director who
attends the meeting without protesting against, before or at its commencement,
any lack of notice.
In principle, the board meetings shall be convened in the form of on-site
meetings. When the directors have sufficient information to vote, they may
also pass the resolution by forms of communication such as video conference
and teleconference, or a combination of onsite meeting and other forms of
communication or present such information in writing to be considered
separately as a written resolution. If a board meeting is held in the form of
a teleconference, with the aid of similar communication equipment or a
combination of onsite meeting and the afore-mentioned forms of communication,
so long as the directors participating in the meeting can clearly hear and
communicate with each other, they shall be deemed to be attending the meeting
in person.
Article 112 A board of directors meeting shall only be convened if a majority of the
number of the board members are attending (including any directors appointed
pursuant to Article 113 of these Articles of Association to attend the meeting
as the representatives of other directors). Each director has one vote. Any
resolution requires the affirmative votes of more than half of all the board
of directors in order to be passed, unless otherwise specified in Article 104.
Article 113 Directors shall attend the meetings of the board of directors in person. Where
a director is unable to attend a meeting for any reason, he may by a written
power of attorney appoint another director to attend the board meeting on his
behalf. The power of attorney shall set out the names of the proxies, the
matters to be dealt with by the agents, the scope of the authorization and the
effective term thereof. The powers of attorney shall be signed or sealed by
the principals.
A Director appointed as the representative of another director to attend the
meeting shall exercise the rights of a director within the scope of authority
conferred by the appointing director. Where a director is unable to attend a
meeting of the board of directors and has not appointed a representative to
attend the meeting on his behalf, he shall be deemed to have waived his right
to vote at the meeting.
Expenses incurred by a director for attending a meeting of the board of
directors shall be paid by the Company. These expenses include the costs of
transportation between the premises of the director and the venue of the
meeting in different cities and accommodation expenses during the meeting.
Rent of the meeting place, local transportation costs and other reasonable
out- of-pocket expenses shall be paid by the Company.
Article 114 The board of directors may accept a written resolution in lieu of a board
meeting provided that a draft of such written resolution shall be delivered to
each director in person, by mail, by telegram, by facsimile or by email. If
the board of directors has delivered such proposed written resolution to all
the directors and the directors who signed and approved such resolution have
reached the required quorum, and the same have been delivered to the secretary
of the board of directors, then such resolution shall take effect as a
resolution of the board meeting, without having to hold a board meeting.
Article 115 The board of directors shall keep minutes of resolutions passed at meetings of
the board of directors in Chinese. The directors attending the board meeting
shall have the right to request to have the descriptive information on their
speech given thereat to be recorded in the minutes. Opinions of the
independent (non-executive) directors shall be clearly stated in the
resolutions of the board of directors. The minutes of each board meeting shall
be provided to all the directors promptly. Directors who wish to amend or
supplement the minutes shall submit the proposed amendments to the Chairman in
writing within one week after receipt of the meeting minutes. The minutes
shall be signed by the directors attending the meeting and the person who
recorded the minutes after they are finalised. The minutes of board meetings
shall be kept at the premises of the Company in the PRC and a complete copy of
the minutes shall be promptly sent to each director. Documents of meetings
shall be kept as permanent records.
Article 116 Where a written resolution is reached in the absence of the statutory
procedures but has been signed by the directors, even if each director has
expressed his/her view in different ways, such resolution of the board meeting
shall have no legal effect.
If a resolution of the meeting of the board of directors violates the laws,
regulations, other regulatory documents, the Company's Articles of Association
and resolutions of shareholders' meetings, the directors who participated in
the passing of such resolution shall be directly liable therefor. However, if
it can be proven that a director had expressly objected to the resolution when
the resolution was voted on, and that such objection was recorded in the
minutes of the meeting, such director may be released from such liability. A
director who abstained from voting or was absence from the meeting without
appointing a proxy to attend on his or her behalf may not be released from
such liability. A director who had expressly objected to the resolution during
discussion but had not clearly vote against such motion may not be released
from such liability.
Article 117 Subject to all relevant laws and administrative regulations, the shareholders'
meeting may remove any director (excluding the employee representative
director) by an ordinary resolution before the expiration of his term of
office. However, the director's right to claim for damages arising from his
removal shall not be affected thereby.
Article 118 A director may resign prior to the expiration of his term of office. If a
director resigns from his office, he shall submit a written report of his
resignation to the board of directors, which will be effective from the date
of receipt of the resignation report by the Company. The board of directors
shall disclose such matter within two (2) days. Independent directors shall
provide an explanation on the circumstances which are relevant to his
resignation and which in his opinion are necessary to bring to the attention
of the shareholders and creditors of the Company.
If the resignation of a director will result in the number of directors of the
Company falling below the statutory minimum number of directors, then such
director shall perform his/her duties as a director in accordance with laws,
administrative regulations, departmental rules and the Articles of Association
before a new director is elected to take office.
If the resignation of an independent director will result in the board of
directors of the Company or the special committees having less than the
minimum required proportion of independent directors as required by the
relevant laws, administrative regulations, other regulatory documents, the
Articles of Association or relevant rules of the special committees or result
in lack of accounting professionals among the independent directors, then such
independent director shall continue to fulfil the relevant duties.
CHAPTER 11: INDEPENDENT DIRECTORS
Article 119 Candidates for the independent directors shall be nominated by the board of
directors, audit and risk management committee (the supervision committee) or
shareholder(s) holding, whether alone or together, one percent (1 percent) or
more of the total amount of voting shares in the Company and elected at
shareholders' meeting. The investor protection institution established
according to laws may publicly request the shareholders to entrust it to
exercise the right to nominate independent directors on their behalf.
(1) The nominator of a candidate for the independent directors shall
seek the consent of such candidate prior to nomination and shall have a full
understanding towards the profession, education, job position, detailed
working experience and all other positions held concurrently, and whether
there is any gross dishonesty or other adverse records as well as preparing
written materials containing the said information to the Company. Candidates
shall undertake to the Company in writing that they have agreed to accept the
nomination and that all disclosed information relating to them are true and
complete and shall guarantee that they will conscientiously perform the
director's responsibilities when elected.
(2) The nominator shall provide his opinion in connection with the
qualification and independency of such nominees for acting as an independent
director. If the applicable laws, regulations, other regulatory documents
and/or the listing rules of securities contain the relevant provisions, the
nominee shall make a public statement in accordance with such provisions that
there does not exist any relationship between himself and the Company which
may influence his independent objective judgement.
(3) If the nomination of a candidate for the independent directors is
taken place before the board meeting of the Company is convened and if the
applicable laws, regulations, other regulatory documents and/or the listing
rules of securities contain the relevant provisions, the written materials
concerning the nominee set out in subparagraphs (1) and (2) of this Article
shall be publicly announced together with the resolutions of the board meeting
in accordance with such provisions.
(4) If a shareholder holding, alone or together, more than 1 percent
of the voting right of the Company or the audit and risk management committee
(the supervision committee) proposes an ex tempore motion at the shareholders'
meeting on the election of non-independent directors, the written notice
specifying the intention to propose a person for election as a director and
the willingness of the nominee to accept nomination together with the written
materials and undertakings containing such particulars of the nominee as set
out in subparagraphs (1) and (2) of this Article shall be despatched to the
Company within ten (10) days prior to the shareholders' meeting.
(5) Before a shareholders' meeting is convened to elect independent directors,
if the applicable laws, regulations, other regulatory documents and/or the
listing rules of securities contain the relevant provisions, the Company shall
in accordance with such provisions submit relevant materials regarding all
nominees to the stock exchanges on which the Company is listed. If the board
of directors of the Company objects to the qualifications of the nominees, a
written opinion of the board of directors in connection therewith shall also
be submitted at the same time. If the stock exchanges on which the securities
of the Company are listed has an objection to a nominee, such nominee shall
not qualify to be a candidate for election as an independent director. When
convening a shareholders' meeting to elect independent directors, the board of
directors of the Company shall explain whether or not there is any objection
to any of the candidates for independent directors.
Article 120 In accordance with the requirements of the laws, administrative regulations,
regulations of the CSRC, the stock exchanges and the Articles of Association,
independent directors shall diligently perform their duties, play the roles in
decision-making, supervise checks and balances, and provide professional
advice to the board of directors, safeguard the overall interests of the
Company, and protect the legitimate rights and interests of minority
shareholders.
Article 121 A person acting as an independent director shall fulfil the following basic
requirements:
(1) he or she shall possess the qualifications to act as the director
of a listed company in accordance with the laws, regulations and other
relevant requirements;
(2) he or she conforms with independence required by the relevant
laws, regulations, other relevant requirements and the Articles of
Association;
(3) he or she possesses the basic knowledge of operation of a listed
company and is familiar with relevant laws, regulations and rules (including
but not limited to the accounting principles);
(4) he or she shall have not less than 5 years of law, accounting,
economics or other working experience necessary for performing duties of an
independent director;
(5) he or she shall have good character traits and shall not have any
gross dishonesty or other adverse records;
(6) he or she shall fulfil other conditions as prescribed by the laws,
administrative regulations, securities regulatory authority in the place where
the Company is listed, the stock exchanges where the securities of the Company
are listed and the Articles of Association.
Article 122 Independent directors shall have independence. Unless otherwise required by
the relevant laws, regulations, other regulatory documents and/or the listing
rules of securities, none of the following persons shall act as independent
directors:
(1) persons working in the Company or its subsidiaries, as well as
their spouses, parents, children and major social relations;
(2) natural person shareholders as well as their spouses, parents and
children who directly or indirectly hold not less than one percent of the
issued shares of the Company or who are ranked as the top ten shareholders of
the Company;
(3) persons as well as their spouses, parents and children who work in
entities which are such shareholders of the Company directly or indirectly
holding not less than five percent of the shares of the Company in issue or
which are ranked as the top five shareholders of the Company;
(4) persons as well as their spouses, parents and children who work in
the subsidiary of the Company's controlling shareholder and de facto
controller;
(5) persons who have material business transactions with the Company
and its controlling shareholders, de facto controllers or their respective
subsidiaries, or persons who hold positions in such entities and their
controlling shareholders or de facto controllers that have material business
transactions with the same;
(6) persons who provide financial, legal, consulting, recommendation
and other services for the Company, its controlling shareholders, de facto
controllers or their respective subsidiaries, including but not limited to all
personnel of the project team, reviewers at all levels, personnel signing the
report, partners, directors, senior officers and principal responsible persons
of the intermediary institutions providing services;
(7) persons who have satisfied the conditions stated in sub-paragraph
(1) to sub-paragraph (6) in the last 12 months;
(8) other persons without independence as stipulated by laws, administrative
regulations, the CSRC, stock exchanges and these Articles of Association.
The subsidiaries of the controlling shareholders and de facto controllers of
the Company mentioned in preceding subparagraphs (4) to (6) do not include the
enterprises controlled by the same state-owned assets management institution
as the Company and not forming a connected relationship with the Company
according to relevant regulations.
Independent directors shall conduct self-examination on their independence
every year and submit the self-examination results to the board of directors.
The board of directors shall evaluate the independence of the independent
directors in office and issue special opinions every year, which shall be
disclosed together with the annual report.
Article 123 If an independent director fails to attend two consecutive board meetings in
person and to appoint other independent directors to attend on his/her behalf,
the board of directors shall propose at the shareholders' meeting that such
independent director should be removed. Where an independent director is
removed from office prior to the expiration of his/her term of office by the
Company through statutory procedures, the Company shall make special
disclosure. The removed independent director may make a public statement if he
believes that he has been improperly removed from his office.
Article 124 Independent directors, as members of the board of directors, shall have the
duty of loyalty and diligence to the Company and all shareholders to prudently
perform the following duties:
(1) to participate in the decision-making of the board of directors
and express clear opinions on the matters discussed;
(2) to supervise the potential material conflicts of interest between
the Company and its controlling shareholders, de facto controllers, directors
and senior officers in accordance with the relevant provisions of the Measures
for the Administration of Independent Directors of Listed Companies, so as to
ensure that the decisions of the board of directors are in line with the
overall interests of the Company and protect the legitimate rights and
interests of minority shareholders;
(3) to provide professional and objective suggestions on the operation
and development of the Company, and promote the improvement of the
decision-making level of the board of directors;
(4) other duties as stipulated by laws, regulations and the Articles
of Association.
Article 125 Apart from such powers as conferred on a director under the Company Law and
other relevant laws, regulations, other regulatory documents and the Articles
of Association, an independent director shall exercise the following special
functions and powers:
(1) to independently engage an intermediary to audit, consult on or
verify specific matters of the Company;
(2) to propose to the board of directors to convene an extraordinary
shareholders' meeting;
(3) to propose to convene a board meeting;
(4) to publicly solicit shareholders' rights from shareholders
according to laws;
(5) to express independent opinions on matters that may damage the
rights and interests of the Company or minority shareholders;
(6) other functions and powers as stipulated by laws, administrative
regulations, the CSRC and these Articles of Association.
An independent director shall obtain the consent from more than half of all
independent directors in the case of exercising his/her functions as described
in preceding sub-paragraphs (1) to (3).
If an independent director exercises the functions and powers as described in
the sub-paragraph (1) of this Article, the Company shall timely disclose the
same. If the aforesaid functions and powers cannot be normally exercised, the
Company shall disclose the specific circumstances and reasons.
Article 126 The following matters shall be submitted to the board of directors for
consideration after being approved by more than half of all independent
directors:
(1) connected transactions that should be disclosed;
(2) plans on changes in or waivers of commitments by the Company and
related parties;
(3) the decisions made and measures taken by the board of directors in
connection with the acquisition of the Company;
(4) other matters as stipulated by laws, administrative regulations,
the CSRC and these Articles of Association.
Article 127 The Company shall establish a mechanism of special meetings attended by all
independent directors. Matters such as related transactions to be considered
by the board of directors shall be approved in advance by a special meeting of
independent directors. The independent directors shall hold special meetings
on a regular or irregular basis, and the matters as described in
sub-paragraphs (1) to (3) of paragraph 1 of Article 125 and Article 126 of
these Articles of Association shall be considered at special meetings of
independent directors.
The special meeting of independent directors may study and discuss other
matters of the Company as required.
The special meeting of independent directors shall be convened and presided
over by an independent director jointly recommended by more than half of the
independent directors; if the convener does not perform his duties or is
unable to perform his duties, two or more independent directors may convene
the meeting and elect a representative to preside over the meeting on their
own.
The minutes of the special meeting of independent directors shall be prepared
in accordance with the regulations, and the opinions of independent directors
shall be recorded in the minutes of the meeting. The independent directors
shall sign to confirm the minutes of the meeting.
The Company shall provide convenience and support for the convening of special
meetings of independent directors.
Article 128 Independent directors shall submit an annual working report
to the shareholders' meeting to give an account of the performance of their
duties.
CHAPTER 12: SPECIAL COMMITTEES OF THE BOARD OF DIRECTORS
Article 129 The board of directors of the Company shall establish the audit and risk
management committee (the supervision committee), the strategy and investment
committee, the nomination committee, the remuneration and appraisal committee,
the aviation safety committee and other special committees, which shall
perform their duties in accordance with these Articles of Association and the
authorization of the board of directors. The resolutions of the special
committees shall be submitted to the board of directors for deliberation and
decision. The working rules of the special committees shall be formulated by
the board of directors.
Article 130 The audit and risk management committee (the supervision committee) shall be
composed of three to five members, who shall be directors who do not hold
senior officer positions in the Company, of whom more than half shall be
independent directors, with accounting professionals among the independent
directors serving as the convenor; the strategy and investment committee shall
be composed of three to seven directors, with the chairman of the board of
directors or his/her designated committee member serving as the convenor; the
nomination committee shall be composed of three to seven directors, of whom a
majority shall be independent directors, with the chairman of the board of
directors serving as the convenor; the remuneration and appraisal committee
shall be composed of three to seven directors, of whom a majority shall be
independent directors, with the independent directors serving as the convenor;
and the aviation safety committee shall be composed of three members, with the
convenor being elected by the members of the aviation safety committee.
Article 131 The audit and risk management committee (the supervision committee) under the
board of directors shall exercise the powers and functions of the supervisory
committee as stipulated in the Company Law.
Article 132 The audit and risk management committee (the supervision committee) shall be
responsible for reviewing the Company's financial information and its
disclosure, supervising and evaluating the internal and external auditing work
and internal control. The following matters shall be submitted to the board of
directors for deliberation with the approval of more than half of all members
of the audit and risk management committee (the supervision committee):
(1) disclosure of financial information and internal control
evaluation reports in financial accounting reports and periodic reports;
(2) appointment or dismissal of an accounting firm that undertakes the
audit business of the Company;
(3) appointment or dismissal of the Company's financial controller;
(4) changes in accounting policies, accounting estimates or
corrections of major accounting errors due to reasons other than changes in
accounting standards;
(5) other matters stipulated by laws, administrative regulations,
provisions of the CSRC and these Articles of Association.
Article 133 The audit and risk management committee (the supervision committee) shall hold
meetings at least once a quarter. Extraordinary meetings may be convened at
the proposals of two or more members or when the convener considers it
necessary. Meetings of the audit and risk management committee (the
supervision committee) shall be held with the presence of more than two thirds
of the members.
Resolutions of the audit and risk management committee (the supervision
committee) shall be passed by more than half of the members of the audit and
risk management committee (the supervision committee).
Each person shall have one vote for a resolution of the audit and risk
management committee (the supervision committee).
The audit and risk management committee (the supervision committee) shall
prepare the minutes of the meeting with respect of resolutions in accordance
with the regulations, and the minutes shall be signed by the members of the
audit and risk management committee (the supervision committee) attending the
meeting.
Article 134 The strategy and investment committee shall be responsible for studying and
supervising the Company's long-term development strategy, major investment and
financing decisions and environmental, social and governance work, etc., and
making recommendations to the board of directors on the following matters:
(1) conducting studies and making recommendations on the Company's
long-term development strategic planning;
(2) conducting studies and making recommendations on the Company's
annual investment plan;
(3) conducting studies and making recommendations on plans for major
investment and financing projects subject to the approval of the board of
directors;
(4) formulating the Company's environmental, social and
governance structure, objectives, management approach and strategy;
(5) conducting supervision and inspection of the implementation of
matters within the scope of the proposed authority;
(6) other matters authorized by laws, administrative regulations,
provisions of the CSRC, these Articles of Association and the board of
directors.
Article 135 The nomination committee shall be responsible for formulating criteria and
procedures for the selection of directors and senior officers, selecting and
reviewing candidates for directors and senior officers and their
qualifications, and making recommendations to the board of directors on the
following matters:
(1) nomination or appointment or dismissal of directors;
(2) appointment or dismissal of senior officers;
(3) other matters authorized by laws, administrative regulations,
provisions of the CSRC, these Articles of Association and the board of
directors.
If the board of directors does not adopt or does not fully adopt the
recommendations of the nomination committee, it shall record the opinions of
the nomination committee and the specific reasons for their non-adoption in
the resolution of the board of directors and disclose the same.
Article 136 The remuneration and appraisal committee shall be responsible for formulating
the appraisal standards for directors and senior officers, conducting
appraisal, formulating and reviewing the remuneration determination
mechanisms, decision-making processes, payment and payment cessation and
recovery arrangements, and other remuneration policies and plans for directors
and senior officers, and making recommendations to the board of directors on
the following matters:
(1) the remuneration of directors and senior officers;
(2) the formulation or amendment of equity incentive plans, employee
stock ownership plans, and the granting of rights to incentive recipients and
the achievement of conditions for the exercise of such rights by incentive
recipients;
(3) the arrangement of stock ownership plans for directors and senior
officers in the event of a proposed spin-off of a subsidiary;
(4) other matters authorized by laws, administrative regulations,
provisions of the CSRC, these Articles of Association and the board of
directors.
If the board of directors does not adopt or does not fully adopt the
recommendations of the remuneration and appraisal committee, it shall record
the opinions of the remuneration and appraisal committee and the specific
reasons for their non-adoption in the resolution of the board of directors and
disclose the same.
Article 137 The aviation safety committee shall be responsible for supervising the
management of aviation safety of the Company, providing support to the board
of directors in making decisions on aviation safety, and making
recommendations to the board of directors on the following matters:
(1) analysis of the Company's security situation;
(2) major problems in the Company's aviation safety work;
(3) other matters authorized by the board of directors of the Company.
Article 138 Where the relevant competent department of the State Council makes other
provisions regarding special committees, such provisions shall prevail.
CHAPTER 13: SECRETARY OF THE BOARD OF DIRECTORS
Article 139 The Company shall have one (1) secretary of the board of directors. The
secretary shall be a senior officer of the Company and be present at the
shareholders' meetings, the board of directors' meetings, the president's
office meetings and other important decision-making meetings of the Company as
well as the special committee meetings of the board of directors. When the
party committee studies and discusses major operation and management matters,
the secretary of the board of directors shall attend.
The board of directors shall establish the office of the board of directors as
the administrative organization of the board of directors, which shall be
headed by the secretary of the board of directors.
Article 140 The secretary of the Company's board of directors shall be a natural person
who has the requisite professional knowledge and experience, and shall be
appointed by the board of directors.
The main tasks and duties of the secretary of the board of directors include:
(1) assist the board of directors of the Company to strengthen the
development of modern enterprise system and corporate governance mechanism
with Chinese characteristics, organize research on corporate governance and
organize the formulation of rules and regulations in relation to corporate
governance;
(2) to organize the implementation of the corporate governance system
and manage the relevant affairs;
(3) assist the directors in the day-to-day work of the board of
directors, continuously provide the directors with, advise the directors of
and ensure that the directors understand the regulations, policies and
requirements of the foreign and domestic regulatory authorities on the
operation of the Company, assist the directors and the president in
effectively complying with relevant foreign and domestic laws, regulations,
the Company's Articles of Association and other relevant regulations;
(4) responsible for the organization and preparation of documents for
board meetings and shareholders' meetings, take proper meeting minutes, ensure
that the resolutions passed at the meetings comply with statutory procedures
and supervise the implementation of the resolutions of the board of directors;
(5) responsible for the organization and coordination of information
disclosure, coordinate the relationship with investors and enhance
transparency of the Company;
(6) participate in arranging of financing through capital markets;
(7) deal with intermediaries, regulatory authorities and media,
maintain good public relations work;
(8) assist the Chairman in formulating major proposals, establishing
or amending various rules and regulations for the operation of the board of
directors;
(9) execute other tasks assigned by the board of directors or the
chairman of the board of directors;
(10) other duties as stipulated by laws, regulations, other regulatory
documents (including the listing rules of securities) and the Articles of
Association.
Article 141 A director or other senior officer personnel of the Company may also act as
the secretary of the board of directors.
Where the office of secretary is held concurrently by a director, and an act
is required to be done by a director and a secretary separately, the person
who holds the office of director and secretary may not perform the act in a
dual capacity.
Article 142 The secretary of the board of directors shall diligently exercise his duties
in accordance with the laws, administrative regulations, departmental rules
and the relevant provisions of these Articles of Association.
The secretary of the board of directors shall assist the Company in complying
with the relevant PRC laws and the rules of the securities exchange on which
the shares of the Company are listed.
CHAPTER 14: SENIOR OFFICERS
Article 143 The Company shall have a president who shall be appointed or dismissed by the
board of directors.
The Company shall have several vice presidents, one chief financial officer,
one chief pilot and one general legal counsel who shall assist the president.
The vice presidents, chief financial officer, chief pilot and general legal
counsel shall be nominated by the president and appointed or dismissed by the
board of directors.
Article 144 The term of office for a president shall be 3 years and is renewable if re-
appointed.
Article 145 The president shall be accountable to the board of directors and shall
exercise the following functions and powers:
(1) to be in charge of the Company's production, operation and
management and to organize the implementation of the resolutions of the board
of directors;
(2) to organize the implementation of the Company's annual business
plan and investment proposal;
(3) subject to applicable laws and these Articles of Association, to
decide on transactions, which are related to the Company's main business, and
the value of which shall not exceed certain amount, or certain proportion of
the Company's latest audited net assets;
(4) to sign contracts and agreements on behalf of the Company in
accordance with the authorization granted by the board of directors or the
legal representative;
(5) to draft plans for the establishment of the Company's internal
management structure, and where necessary, make plans for general
institutional adjustment;
(6) to draft the Company's basic management system;
(7) to formulate specific rules and regulations for the Company;
(8) to propose to the board of directors the appointment or dismissal
of the vice presidents, chief accountant, chief pilot and general legal
counsel of the Company;
(9) to appoint or dismiss management personnel other than those
required to be appointed or dismissed by the board of directors;
(10) to propose to convene an extraordinary meeting of the board of
directors;
(11) other powers conferred by the Articles of Association or the board of
directors.
Article 146 The president shall formulate the president's working rules and submit the
same to the board of directors for approval before implementation.
The president's working rules shall include the following:
(1) the conditions and procedures for the convening of the president's
meeting and the persons participating in it;
(2) the use of funds and assets of the Company, the authority to sign
major contracts, and the reporting system to the board of directors;
(3) other matters deemed necessary by the board of directors.
Article 147 The president shall attend meetings of the board of directors. If the matters
deliberated by the board of directors involve legal issues, the general legal
counsel shall attend and give legal opinions. The president who is not a
director shall not have the right to vote at board meetings.
Article 148 If the senior officers, in performing their duties for the Company, cause
damage to others, the Company shall bear the liability for compensation; the
senior officers shall also bear the liability for compensation if there is any
willfulness or gross negligence on their part. Senior officers who violate
laws, administrative regulations, departmental rules or the provisions of
these Articles of Association in the course of performing their duties for the
Company and cause damage to the Company shall be liable for compensation.
Article 149 Senior officers of the Company shall faithfully perform their duties and
safeguard the best interests of the Company and all shareholders. Senior
officers of the Company who fail to perform their duties faithfully or violate
their obligations of good faith and cause damage to the interests of the
Company and public shareholders shall be liable for compensation in accordance
with laws.
CHAPTER 15: THE QUALIFICATIONS AND DUTIES OF THE DIRECTORS, SENIOR OFFICERS OF
THE COMPANY
Article 150 A person may not serve as a director or senior officers of the Company if any
of the following circumstances apply:
(1) a person who does not have or who has limited capacity for civil
conduct;
(2) a person who has been sentenced for corruption, bribery,
infringement of property or misappropriation of property or disruption of the
social economic order, or a person who has been deprived of his political
rights and not more than 5 years have elapsed since the sentence was served,
or, in the case of a probation, less than 2 years have elapsed since the date
of expiry of the period of probation;
(3) a person who is a former director, factory manager or manager of a
company or enterprise which has been dissolved or put into liquidation and who
was personally liable for the winding up of such company or enterprise, where
less than 3 years have elapsed since the date of completion of the insolvent
liquidation of the company or enterprise;
(4) a person who is a former legal representative of a company or
enterprise the business licence of which was revoked or which has been ordered
to be closed due to violation of law and who are personally liable therefor,
where less than 3 years have elapsed since the date of the revocation of the
business licence or the ordering of being closed;
(5) a person who has been listed as a dishonest debtor by the People's
Court due to a relatively large amount of debts which have become overdue;
(6) a person who has been subject to measures imposed by the CSRC in
relation to the ban on the entry into the securities market for a period of
time that has not expired;
(7) a person who has been publicly recognized by the stock exchange as
unsuitable to serve as a director, senior officers, etc. of a listed company
for a period of time that has not expired;
(8) a person who, according to laws, administrative regulations or
departmental rules, cannot act as a leader of an enterprise;
(9) other contents as provided for by the laws, administrative
regulations or departmental rules.
If a director is elected or appointed in violation of the provision of this
Article, such election, appointment or employment shall be null and void. If
any of the above circumstances occurs on the part of a director during his
term of office, the board of directors shall, starting from the date on which
they are aware thereof, forthwith cease the performance of duties by the
relevant director and propose to remove such director from his post at the
shareholders' meeting. If any of the above circumstances occurs on the part of
a senior officer during his term of office, the board of directors shall,
starting from the date on which they are aware thereof, forthwith cease the
performance of duties by the relevant senior officer and convene a board
meeting to dismiss such senior officer.
Article 151 No director may act in his own name or on behalf of the Company or the board
of directors without legal authorization pursuant to the provisions of the
Articles of Association or by the board of directors. In the course of acting
in his own name, a director shall state his position and identity insofar as a
third party may reasonably believe that such director is acting on behalf of
the Company or the board of directors.
Article 152 The directors of the Company shall comply with the laws, administrative
regulations and these Articles of Association, and bear fiduciary duties to
the Company, take measures to avoid any possible conflict of interests with
the Company and may not abuse their authority to seek illicit benefits.
The directors shall have the following loyalty obligations to the Company:
(1) not to misappropriate the property of the Company, misappropriate
the funds of the Company;
(2) not to open an account in his own name or in the name of any other
individual to deposit the funds of the Company;
(3) not to abuse their authority to accept any bribe or other illicit
income;
(4) not to enter into contracts or conduct transactions with the
Company without reporting to the Board or the shareholders' meeting or
approval of resolutions of the Board or shareholders' meeting directly or
indirectly pursuant to the provisions of these Articles of Association;
(5) not to take advantage of his authority to seek for himself or
others business opportunities that belong to the Company, except where they
reported to the Board or the shareholders' meeting and received approval of
shareholders' meeting resolutions or such business opportunities can not be
exploited by the Company according to laws, regulations or these Articles of
Association;
(6) not to engage in business of the same kind as that of the Company
for himself or others without reporting to the Board or the shareholders'
meeting and obtaining approval by a resolution of the shareholders' meeting;
(7) not to accept commissions from others' transactions with the
Company for his own benefit;
(8) not to disclose the secrets of the Company without authorization;
(9) not to damage the interests of the Company by taking advantage of
its connected relationship;
(10) other loyalty obligations stipulated by laws, administrative
regulations, departmental rules and these Articles of Association.
The income obtained by a director in violation of the provisions of this
Article shall belong to the Company; If any loss is caused to the Company,
he/she shall be liable for compensation.
The provisions in subparagraph (4) of the second paragraph of this Article
shall apply to contracts or transactions entered into by close relatives of
directors or the senior officer, enterprises directly or indirectly controlled
by directors or senior officer personnel or their close relatives, and
associates with whom directors or senior officer personnel have other related
relationships.
Article 153 Directors shall abide by laws, administrative regulations and these Articles
of Association, and owe a duty of diligence to the Company, and shall perform
their duties with the reasonable care that a person in a governance role would
ordinarily exercise for the Company's best interests.
Directors shall have the following diligence obligations to the Company:
(1) to exercise the rights granted by the Company cautiously,
conscientiously and diligently to ensure that the business activities of the
Company comply with the requirements of national laws, administrative
regulations and various national economic policies, and that the business
activities do not exceed the business scope specified in the business license;
(2) to treat all shareholders fairly;
(3) to keep abreast of the business operation and management status of
the Company;
(4) to sign a written confirmation opinion on the periodic report of
the Company. Ensure that the information disclosed by the Company is true,
accurate and complete;
(5) to provide the audit and risk management committee (supervision
committee) with relevant information and materials truthfully, and not to
hinder the audit and risk management committee (supervision committee) from
exercising their powers;
(6) other diligence obligations stipulated by laws, administrative
regulations, departmental rules and these Articles of Association.
Article 154 Directors shall be deemed to be failed to carry out their duties if they fail
to attend two consecutive board meetings in person and to appoint other
directors to attend board meetings on their behalf. The board of directors
shall propose at the shareholders' meeting for the removal of such directors.
Article 155 The provisions in Article 152 on the loyalty obligation of directors and in
sub- paragraphs (4), (5) and (6) of Article 153 on the diligence obligation
shall also apply to senior officers.
Article 156 When a shareholders' meeting is convened, where the shareholders' meeting
requires directors, senior officer personnel to attend the meeting, the
directors and senior officer personnel shall attend the meeting and answer the
inquiries of shareholders.
Article 157 The Company has established a management system for directors' and senior
officers' resignations, clearly specifying the accountability and compensation
measures for unfulfilled public commitments and other outstanding matters.
If the resignation of a director or senior officer of the Company takes effect
or his or her term of office expires, he or she shall complete all handover
procedures to the board of directors, his or her fiduciary duty owed to the
Company and shareholders do not automatically terminate upon the expiration of
his or her term of office, and shall remain effective for a reasonable period
determined by the Company at the time of his or her resignation or the expiry
of his or her term of office. Responsibilities that a director shall assume
due to the performance of his duties during his term of office shall not be
exempted or terminated due to his separation from the Company. The survival of
a director's fiduciary duties shall be determined in accordance with the
principles of fairness as well as taking into consideration the time interval
between the occurrence of the event concern and the timing of his or her
departure together with the circumstances and conditions under which the said
person terminates his or her relationship with the Company.
Article 158 Any director or senior officer personnel who, when performing their duties in
the Company, violates the laws, administrative regulations, departmental rules
and regulations or the provisions contained in the Articles of Association
resulting in causing losses to the Company shall be liable for indemnifying
the Company. Any director or senior officer whose term of office has not
expired shall be liable for compensation of any losses incurred by the Company
due to his or her absence from duty without permission.
Article 159 Subject to the exceptions provided by these Articles of Association, a
director shall not vote at the relevant meeting of the board of directors in
respect of any contract, transaction or arrangement in which he, or his
connected persons (as defined in the applicable listing rules as amended from
time to time), are materially interested and he shall not be counted as part
of the quorum of such meeting.
Article 160 Subject to the approval by the shareholders' meeting, the Company may take out
liability insurance for any director and senior officer of the Company, except
for those liability resulting from the violation of laws, regulations, other
regulatory documents and the Articles of Association by such director and
senior officer of the Company.
CHAPTER 16: FINANCIAL AND ACCOUNTING SYSTEMS, PROFIT DISTRIBUTION AND AUDIT
Article 161 The Company shall establish its financial and accounting systems in accordance
with laws, administrative regulations and provisions of the relevant
authorities of the state.
Article 162 The fiscal year of the Company shall be on the basis of the solar calendar
beginning on 1 January and ending on 31 December of the same year.
The Company shall use Renminbi as its standard unit of account. The accounts
shall be prepared in Chinese.
At the end of each fiscal year, the Company shall prepare a financial report
which shall be examined and verified by an accounting firm in a manner
prescribed by law.
Article 163 The board of directors of the Company shall place before the shareholders at
every annual shareholders' meeting such financial reports which the relevant
laws, administrative regulations, rules and other directives require the
Company to prepare. Such reports must be audited and reviewed.
Article 164 The Company's financial reports shall be made available for shareholders'
inspection at the Company twenty (20) days before the date of every annual
shareholders' meeting. Each shareholder shall be entitled to obtain a copy of
the financial reports referred to in this Chapter.
The Company shall send to each holder of Overseas-Listed Foreign Shares by
prepaid mail at the address registered in the register of shareholders the
said reports not later than twenty-one (21) days before the date of every
annual shareholders' meeting of the shareholders.
Provided that the laws and regulations and the listing rules of securities of
the jurisdictions where the shares of the Company are listed are complied
with, the abovementioned report may also be issued or provided to the holders
of Overseas- Listed Foreign Shares by other means as specified in Article 215
herein.
Article 165 The financial statements of the Company shall, in addition to being prepared
in accordance with PRC accounting standards and regulations, be prepared in
accordance with either international accounting standards, or that of the
place outside the PRC where the Company's shares are listed. If there is any
material difference between the financial statements prepared respectively in
accordance with the two accounting standards, such difference shall be stated
in the financial statements. In distributing its after-tax profits, the lower
of the two amounts shown in the financial statements shall be adopted.
Article 166 Any interim results or financial information published or disclosed by the
Company must also be prepared and presented in accordance with PRC accounting
standards and regulations, and also in accordance with either international
accounting standards or that of the place overseas where the Company's shares
are listed.
Article 167 The Company shall publish its financial reports four times every fiscal year,
that is, the first quarterly financial report shall be published within thirty
(30) days after the expiration of the first 3 months of each fiscal year; the
interim financial report shall be published within sixty (60) days after the
expiration of the first 6 months of each fiscal year; the third quarterly
financial report shall be published within thirty (30) days after the
expiration of the first 9 months of each fiscal year; and the annual financial
report shall be published within one hundred and twenty (120) days after the
expiration of each fiscal year.
Article 168 The Company's financial reports shall be prepared pursuant to the relevant
laws, administrative regulations and departmental rules and regulations.
Article 169 The Company shall not keep accounts other than those required by law.
Article 170 When distributing its after-tax profits in a given year, the Company shall
contribute 10 percent of such profits to the Company's statutory common
reserve fund. Where the accumulated amount of the statutory common reserve
fund reaches 50 percent or more of the registered capital of the Company, no
further contribution is required.
Where the statutory common reserve fund is insufficient to make for the losses
of the Company in the previous year, before making contribution to the
statutory common reserve fund, the profits made in the current year shall be
used to make up for the losses first.
After making contribution to the statutory common reserve fund from its after-
tax profits, the Company may, subject to resolutions adopted at a
shareholders' meeting, make contributions to discretionary common reserve
funds from its after-tax profits.
Article 171 The common reserve funds (including the statutory common reserve fund,
discretionary common reserve funds and capital surplus fund) of the Company
shall be applied for making up for losses, expanding the Company's production
and operation or converting into increased registered capital.
When the statutory common reserve fund is converted into increased registered
capital, the balance of such fund shall not be less than 25 percent of the
registered capital prior to capitalisation.
Article 172 After making up for the losses and making contributions to the common reserve
fund, any remaining profits shall be distributed to the shareholders in
proportion to their respective shareholders.
The Company shall not allocate dividends or carry out other allocations in the
form of bonuses before it has compensated for its losses and made allocations
to the statutory common reserve fund. No shares of the Company held by the
Company shall participate in these allocations.
If the shareholders' meeting distributes profit to shareholders in violation
of the Company Law, the shareholders shall return such distributed profits to
the Company; if losses are caused to the Company, shareholders and directors
and senior officers held accountable shall be liable for damages.
Dividends paid by the Company shall not carry any interest except where the
Company has failed to pay the dividends to the shareholders on the date on
which such dividends become payable.
Any amount paid up in advance of calls on a share shall carry interest, but
shall not entitle the holder of the share to receive, by way of advance
payment, the dividend declared and distributed thereafter.
Article 173 Basic principles for dividends distribution policy:
(1) the Company shall fully consider the returns to investors and
implement proactive dividends distribution policy;
(2) the dividends distribution policy of the Company shall remain
continuous and stable, and take into account long-term interests of the
Company, interests of all shareholders as a whole and sustainable development
of the Company;
(3) the Company shall distribute its dividends by way of cash as
priority. The Company may distribute interim dividends if the conditions
permit.
Article 174 Specific dividends distribution policy of the Company:
(1) The form of dividends distribution:
The Company may distribute dividends in cash, shares or a combination of cash
and shares or other methods permitted by the laws, administrative regulations,
departmental rules and the regulatory rules of the jurisdictions in which the
shares of the Company are listed.
The board of directors of the Company shall have comprehensive consideration
of the factors, including its industry characteristics, development stage,
operation mode, profitability level and whether there is any significant
expenditure payment arrangement, make the differentiated cash bonus policy
according to the procedures prescribed by the Articles of Association, and
identify the proportion of the cash bonus in the profit distribution in the
current year, with proportion in compliance with the relevant stipulations of
laws, administrative regulations, normative documentation and stock exchanges.
(2) Specific conditions, proportions and intervals for distributing
cash dividends by the Company:
Save as special circumstances, the dividends shall be distributed in cash by
the Company provided that the distributable profits (i.e. the balance of
profit after tax, after making up for the losses and making contributions to
the common reserve fund in accordance with the provisions of these Articles of
Association as well as deducting otherwise approved by the relevant national
departments) realized for the current year in the financial statement of the
parent company prepared in accordance with applicable domestic and overseas
accounting standards and regulations are positive, and the cash dividends to
be distributed each year shall not be less than 15 percent of the applicable
distributable profits.
The applicable distributable profits shall be the lower of the distributable
profits in the financial statements of the parent company prepared by the
Company in accordance with applicable domestic and overseas accounting
standards and regulations.
Special circumstances refer to the circumstances under which the board of
directors considers that cash dividend distribution may influence the
Company's continuing operation and long-term development.
When the aforesaid conditions of cash distribution are met, cash dividends
shall be distributed once a year. The board of directors of the Company can
propose the annual shareholders' meeting to consider and approve the
conditions of the distribution of interim cash dividend, the proportional
limits, and the upper amount limits and etc. for the subsequent year according
to the Company's status of profitability and capital needs, and the board of
directors shall formulate a specific interim dividend plan based on the
resolution of the annual shareholders' meeting, and distribute interim cash
dividend, provided that the conditions for profit distribution are met. The
interim dividend distribution of the Company shall not exceed the net profit
attributable to shareholders of the listed company for the corresponding
period.
(3) Specific conditions under which the Company may issue shares in
lieu of dividends:
Where the Company is in a sound operating condition, and the board of
directors considers that the Company's stock price does not reflect the
Company's scale of capital, and issuing shares in lieu of dividends will be in
the interests of all shareholders of the Company as a whole, a proposal for
the issuance of shares in lieu of dividends may be proposed upon fulfillment
of the above conditions concerning cash dividends.
Article 175 Alteration of the Company's dividend distribution policy:
In the event of war, natural disasters and other incidents of force majeure,
or changes to the Company's external operating environment resulting in
material impact on its production and operation, or considerably significant
changes to the Company's own operating conditions, the Company may adjust its
profit distribution policy.
The board of directors shall formulate a written report concerning the
adjustment of the Company's profit distribution policy upon a special
discussion with detailed verification and reasons provided. Such written
report shall be submitted to the Shareholders' meeting for approval by way of
a special resolution. In considering the changes to the profit distribution
policy, the Company may actively communicate and exchange ideas with the
Shareholders, in particular the non-substantial and minority Shareholders,
through various channels (such as providing online voting and inviting non-
substantial and minority Shareholders to participate in the meeting), duly
listen to the opinions and demands of non-substantial and minority
Shareholders and provide prompt responses to their questions.
Article 176 Procedures for considering and approving the dividend distribution proposal of
the Company:
(1) The dividends distribution plan of the Company shall be drawn up
by the management of the Company and submitted to the audit and risk
management committee (the supervision committee) and the board of directors of
the Company for consideration. The board of directors shall thoroughly discuss
the rationality of the dividends distribution plan, formulate a special
resolution and then submit it to the shareholders' meeting for consideration.
(2) When formulating specific plan for distribution of cash dividends
by the Company, the board of directors shall study and identify with caution
the timing, conditions and minimum proportion, conditions for adjustment and
requirements for decision-making procedures involved in implementing the
distribution of cash dividends, etc.
If independent directors believe that the specific plan for distribution of
cash dividends may harm the interests of the Company or minority shareholders,
they have the right to express an independent opinion. If the Board does not
adopt or only partially adopts the opinions of independent directors, the
independent directors' opinions and the specific reasons for not adopting them
shall be included in the Board resolution and be disclosed.
(3) Where the Company needs to adjust or amend the cash dividends policy as
determined in these Articles of Association under the special circumstances as
prescribed in the foregoing Article 174, the board of directors shall conduct
a detailed verification of the specific reasons for the adjustment or
amendment, the exact purpose for the retained profit and the estimated
investment return. The board of directors shall then follow the corresponding
decision-making procedures, and the adjustment or amendment shall be approved
by at least two-thirds of the voting rights held by the shareholders attending
the shareholders' meeting.
Before the specific plan for distribution of cash dividends is considered at
the shareholders' meeting, the Company shall communicate with the
shareholders, especially the minority shareholders, through various channels,
such that the opinions and requests of the minority shareholders can be fully
heard, and their concerns can be responded in a timely manner.
Article 177 After the resolution of profit distribution has been adopted by the
shareholders at a shareholders' meeting, or after the board of directors of
the Company has determined a specific plan for the next year's interim
dividend based on the conditions and caps approved by the annual shareholders'
meeting, the board of directors of the Company is required to complete the
distribution of dividends (or shares) within 2 months.
In case of the Shareholders' illegal occupation of company funds, the Company
shall deduct the cash dividends distributed to such Shareholders, in order to
repay the Shareholders' funds occupied.
Article 178 The Company shall declare and pay cash dividends and other amounts which are
payable to holders of A Shares in Renminbi. The Company shall calculate and
declare cash dividends and other payments which are payable to holders of
Foreign Shares in Renminbi, and shall pay such amounts in the local currency
of the jurisdiction where Overseas-Listed Foreign Shares are listed (in case
there are more than one jurisdictions of listing, such amounts shall be paid
in the local currency of the jurisdiction which the board determines as the
main listing place of the Company). The foreign exchange required by the
Company to pay cash dividends and other amounts to holders of Overseas-Listed
Foreign Shares shall be obtained in accordance with the relevant foreign
exchange administrative regulations of the State.
Article 179 Unless otherwise provided for in relevant laws, regulations and other
regulatory documents, where cash dividends and other amounts are to be paid in
Hong Kong dollars, the applicable exchange rate shall be the average closing
rate for the relevant foreign currency announced by the People's Bank of China
during the week prior to the announcement of payment of dividend and other
amounts.
Article 180 When distributing dividends to its shareholders, the Company shall withhold
and pay on behalf of its shareholders the taxes levied on the dividends in
accordance with the provisions of the PRC tax law.
Article 181 The Company shall appoint receiving agents for holders of the Overseas-Listed
Foreign Shares. Such receiving agents shall receive dividends which have been
declared by the Company and all other amounts which the Company should pay to
holders of Overseas-Listed Foreign Shares on such shareholders' behalf.
The receiving agents appointed by the Company shall meet the relevant
requirements of the laws of the place at which the stock exchange on which the
Company's shares are listed or the relevant regulations of such stock
exchange.
The receiving agents appointed for holders of Overseas-Listed Foreign Shares
listed in Hong Kong shall each be a company registered as a trust company
under the Trustee Ordinance of Hong Kong.
Article 182 The Company shall establish an internal audit system, which specifies the
leadership system, responsibilities and authorities, staffing, funding
security, use of audit results, and accountability in relation to internal
audit work. The internal audit system of the Company shall be implemented upon
approval by the board of directors.
Article 183 The internal audit department of the Company shall supervise and inspect the
business activities, risk management, internal control, financial information
and other matters of the Company.
Article 184 The Company's basic systems for internal audit and internal control assessment
shall become effective after the approval of the board of directors. The
establishment of the internal audit institution of the Company and the person
in charge, who shall be accountable to the board of directors and shall report
to the board of directors, are determined by the board of directors.
Article 185 The internal audit department is accountable to the board of directors. The
internal audit department shall be subject to the supervision and guidance of
the audit and risk management committee (the supervision committee) in the
course of its supervising and inspecting the Company's business activities,
risk management, internal control and financial information. The internal
audit department shall immediately and directly report to the audit and risk
management committee (the supervision committee) upon discovering any relevant
major issues or leads.
Article 186 The internal audit department shall be responsible for the specific
organization and implementation of the Company's internal control evaluation.
The Company shall issue an annual internal control evaluation report based on
the evaluation report and related information issued by the internal audit
department and reviewed by the audit and risk management committee (the
supervision committee).
Article 187 When the audit and risk management committee (the supervision committee)
communicates with external audit units such as accounting firms and national
audit agencies, the internal audit department shall proactively cooperate with
them and provide necessary support and collaboration. The audit and risk
management committee (the supervision committee) shall participate in the
appraisal of the person in charge of the internal audit.
CHAPTER 17: APPOINTMENT OF ACCOUNTANCY FIRM
Article 188 The Company shall engage accountants' firms that comply with the requirements
of the Securities Law and the listing rules of securities, to perform the
tasks of auditing accounting statements, verifying the net assets and other
relevant consulting services. The accounting firm shall hold office for 1 year
and may be renewed at expiry.
Article 189 The appointment or removal of an accounting firm by the Company shall be
decided by an ordinary resolution of the shareholders' meeting. The board of
directors shall not appoint an accounting firm before the decision is made at
the shareholders' meeting.
Article 190 The Company undertakes to provide true and complete accounting vouchers,
account books, financial accounting reports and other accounting information
to the appointed accounting firm, and shall not refuse to provide, conceal or
provide any false information.
Article 191 The audit fees payable to an accounting firm shall be determined by way of an
ordinary resolution by the shareholders in a shareholders' meeting.
Article 192 Notice should be given ten (10) days in advance to the accounting firm if the
Company decides to remove such accounting firm or not to renew the appointment
thereof. Such accounting firm shall be entitled to make representations at the
shareholders' meeting. Where the accounting firm resigns from its position, it
shall make clear to the shareholders in a shareholders' meeting whether there
has been any impropriety on the part of the Company.
CHAPTER 18: MERGER AND DEMERGER OF THE COMPANY
Article 193 The Company may conduct merger or demerger in accordance with the law.
In the event of the merger or demerger of the Company, the Company shall adopt
necessary measures to protect the legal rights and interests of shareholders
who object to the merger or demerger of the Company.
A shareholder who objects to the plan of merger or demerger shall have the
right to demand the Company or the shareholders who consent to the plan of
merger or demerger to acquire such dissenting shareholders' shareholding at a
fair price.
The contents of the resolution of merger or demerger of the Company shall
constitute special documents which shall be available for inspection by the
shareholders of the Company. Such special documents shall be sent by mail to
holders of Overseas-Listed Foreign Shares.
Article 194 The merger of the Company may take the form of either merger by absorption or
merger by the establishment of a new company.
Article 195 Where the price paid by the Company for a merger does not exceed ten percent
of the Company's net assets, the merger may be effected without a resolution
of the shareholders' meeting, unless otherwise provided for in these Articles
of Association. Where the Company mergers pursuant to the aforesaid provision
without a resolution of the shareholders' meeting, it shall be resolved by the
board of directors.
Article 196 In the event of a merger, the merging parties shall execute a merger agreement
and prepare a balance sheet and an inventory of assets. The Company shall
notify its creditors within ten (10) days of the date of the Company's merger
resolution and shall publish a public notice in a newspaper or on the National
Enterprise Credit Information Publicity System within thirty (30) days of the
date of the Company's merger resolution.
A creditor has the right, within thirty (30) days upon receipt of the notice,
or for those who have not received the notice, within forty-five (45) days
from the date of the public announcement, to demand the Company to repay its
debts or provide a corresponding guarantee for such debt.
Article 197 Upon the merger, rights in relation to debtors and indebtedness of each of the
merged parties shall be assumed by the company which survives the merger or
the newly established company.
Article 198 Where there is a demerger of the Company, its assets shall be divided up
accordingly.
In the event of demerger of the Company, the parties to such demerger shall
execute a demerger agreement and prepare a balance sheet and an inventory of
assets. The Company shall notify its creditors within ten (10) days of the
date of the Company's division resolution and shall publish a public notice in
a newspaper or on the National Enterprise Credit Information Publicity System
at least three (3) times within thirty (30) days of the date of the Company's
demerger resolution.
Article 199 Debts of the Company prior to demerger shall be assumed by the companies which
exist after the division on a joint and several basis except to the extent
that prior to demerger, the Company has otherwise reached a written agreement
with its creditors in respect of the settlement of debts.
Article 200 The Company shall, in accordance with law, apply for change in its
registration with the companies registration authority where a change in any
item in its registration arises as a result of any merger or division. Where
the Company is dissolved, the Company shall apply for cancellation of its
registration in accordance with law. Where a new company is established, the
Company shall apply for registration thereof in accordance with law.
CHAPTER 19: DISSOLUTION AND LIQUIDATION
Article 201 The Company shall be dissolved upon the following reasons:
(1) the term of operation of the Company prescribed in these Articles
of Association has expired, or other causes for dissolution as stipulated in
these Articles of Association occur;
(2) a resolution for dissolution is passed by shareholders at a
shareholders' meeting;
(3) dissolution is necessary due to a merger or demerger of the
Company;
(4) the company has its business licence revoked, or is ordered to
close up or to have its business cancelled in accordance with the law; or
(5) If a company has encountered serious difficulties in its
operations and management and the company's continued existence may materially
harm the interests of the shareholders, and if the same fails to be resolved
by any other means, shareholders holding ten percent or more of the aggregate
voting rights of the Company may request a People's Court to dissolve the
Company.
The Company shall, within ten (10) days of the occurrence of any of the
reasons for dissolution as stipulated in the preceding paragraph, make public
such reason for dissolution through the National Enterprise Credit Information
Publicity System.
Article 202 Under the circumstances described in sub-paragraphs (1) and (2) of Article 201
in these Articles of Association and no asset has been distributed to the
shareholders, the Company may continue to exist through amendment of these
Articles of Association or by a resolution of the shareholders' meeting.
Amendment of these Articles of Association or a resolution made at a
shareholders' meeting in accordance with the above paragraph shall be passed
by no less than two-thirds of the voting rights held by the shareholders
attending the shareholders' meeting.
Article 203 The Company shall be liquidated if it is dissolved pursuant to sub-paragraphs
(1), (2), (4) and (5) of Article 201 in these Articles of Association. The
directors are the Company's liquidators and shall establish a liquidation
committee to carry out liquidation within fifteen (15) days after the
occurrence of the cause for dissolution. The liquidation committee shall be
composed of directors, except where otherwise provided by these Articles of
Association or resolved at a shareholders' meeting to appoint others.
If the liquidators fail to fulfill the liquidation obligations in a timely
manner and cause losses to the Company or creditors, they shall be liable for
compensation.
Article 204 The liquidation committee shall, within ten (10) days of its establishment,
send notices to creditors and shall, within sixty (60) days of its
establishment, publish a public announcement in a newspaper or on the National
Enterprise Credit Information Publicity System. Creditors should, within
thirty (30) days upon receipt of the notice, or for those who have not
received the notice, within forty-five (45) days from the date of the public
announcement, declare their claims to the liquidation committee.
When declaring claims, creditors shall state relevant particulars of their
claims and provide supporting materials. The liquidation committee shall
register the claims.
The liquidation committee shall not make repayment to creditors during the
claims declaration period.
Article 205 During the liquidation period, the liquidation committee shall exercise the
following functions and powers:
(1) to sort out the Company's assets and prepare a balance sheet and
an inventory of assets respectively;
(2) to notify the creditors or to publish public announcements;
(3) to dispose of and liquidate any unfinished businesses of the
Company;
(4) to pay all outstanding taxes and taxes incurred during the
liquidation process;
(5) to settle claims and debts;
(6) to deal with the surplus assets remaining after the Company's
debts have been repaid;
(7) to represent the Company in any civil proceedings.
Article 206 After it has sorted out the Company's assets and after it has prepared the
balance sheet and an inventory of assets, the liquidation committee shall
formulate a liquidation plan and present it to a shareholders' meeting or to
the People's Court for confirmation.
After the payment of liquidation expenses, salaries, social insurance premiums
and statutory compensation payments, outstanding taxes, and debts of the
Company, the remaining assets of the Company shall be distributed to its
shareholders according to the proportion of their shareholding. The Company's
assets shall not be distributed to shareholders before repayments are made in
accordance with the requirements under the preceding paragraph. During the
liquidation period, the Company survives and shall not commence any business
activities that are not related to liquidation.
Article 207 If after putting the Company's assets in order and preparing a balance sheet
and an inventory of assets, the liquidation committee discovers that the
Company's assets are insufficient to repay the Company's debts in full, the
liquidation committee shall apply to the People's Court for bankruptcy and
liquidation in accordance with laws.
After the People's Court accepts the bankruptcy application, the liquidation
committee shall transfer all matters arising from the liquidation to the
bankruptcy administrator designated by the People's Court.
Article 208 Following the completion of the liquidation, the liquidation committee shall
prepare a liquidation report and submit it to the shareholders' meeting or the
People's Court for confirmation and to the companies registration authority to
apply for cancellation of registration of the Company.
Article 209 Members of the liquidation committee shall perform their liquidation
obligation and bear duties of loyalty and diligence. If any member of the
liquidation committee is negligent in performing its liquidation duties and
causes losses to the Company, or causes losses to the creditors due to
intentional misconduct or gross negligence, he/she shall be liable for
compensation.
Article 210 Where it is declared bankrupt by law, the Company shall implement bankruptcy
and liquidation in accordance with the law on corporate bankruptcy.
CHAPTER 20: PROCEDURES FOR AMENDMENT OF THE COMPANY'S ARTICLES OF ASSOCIATION
Article 211 The Company will amend these Articles of Association under any of the
following circumstances:
(1) following the amendments to the Company Law or other relevant laws
or administrative regulations, the matters provided for in these Articles of
Association conflict with the requirements of the amended laws or
administrative regulations;
(2) following the change in the state of the Company's affairs, its
conditions become inconsistent with matters provided for in these Articles of
Association;
(3) following a resolution passed at a shareholders' meeting, it is
determined to amend the Articles of Association.
Article 212 Any amendment to the Articles of Association approved by a resolution of the
shareholders' meeting subject to review and approval by the competent
authorities shall be submitted to the competent authorities for approval.
Where amendments of the Articles of Association involve the registered
particulars of the Company, procedures for alteration of registration shall be
handled in accordance with the law.
Article 213 The board of directors shall make amendments to these Articles of Association
in accordance with the resolution of the shareholders' meeting on the
amendments to the Articles of Association and the review comments from the
relevant competent authorities.
Article 214 Matters on amendment to the Articles of Association shall be publicly
disclosed if so required by laws, regulations and the listing rules of
securities, and regulatory authorities.
CHAPTER 21: NOTICES AND PUBLIC ANNOUNCEMENTS
Article 215 The Company's notices (for the purpose of this chapter, the term "Notice"
shall include the notice of any meetings, corporate communications or other
written materials issued by the Company to its shareholders) may be delivered
by the following means: (1) by designated person; (2) by mail; (3) by way of
public announcement; (4) by other means as recognised by the securities
regulatory authority and stock exchange in the jurisdictions where the shares
of the Company are listed or by other means as provided in Articles of
Association.
The Company's notices delivered by way of public announcement shall be
published in the newspapers designated by the securities regulatory authority
and stock exchange of the jurisdictions where the shares of the Company are
listed (if any) and/or in other designated media (including websites).
As for the methods in which the corporate communications are provided and/or
distributed by the Company to holders of Overseas-Listed Foreign Shares as
required by Hong Kong Listing Rules, the corporate communications may, subject
to compliance with the laws and regulations and the listing rules of
securities of the jurisdictions where the shares of the Company are listed, be
sent or provided by the Company to the holders of Overseas-Listed Foreign
Shares by any electronic means or by publishing such corporate communications
on the Company's website and the designated website of the Stock Exchange.
The term "Corporate Communication" refers to any document issued or to be
issued by the Company to the holders of its securities for their information
or action, including but not limited to:
(1) the directors' report, annual accounts of the Company together
with the accounting firm's report and, where applicable, the summary of its
financial report;
(2) the interim report and, where applicable, the summary of its
interim report;
(3) the notice of meeting;
(4) the listing document;
(5) the circular; and
(6) the proxy form.
Article 216 If the notice of the Company is given in person, the recipient shall sign (or
seal) on the return receipt and the date of signing the return receipt by the
recipient shall be deemed to be the date of delivery.
If a notice of the Company is made by public announcement, the date of service
shall be the date on which the first announcement is published. If the
corporate communication is made or provided at the Company's website and the
designated website of the Stock Exchange to holders of Overseas-Listed Foreign
Shares, such corporate communication shall be deemed to be made and served on
the date it is first published on the websites. The corporate communication
shall be deemed to have been received at the time it is sent by way of e-mail
as recorded by the computer.
Article 217 Where a notice is sent by post, the notice shall be put into a clearly
addressed and prepaid postage envelope. Such notice shall be deemed to have
been issued on the date on which the envelope containing the notice has been
delivered to the post office and served on the third working day commencing
from the date of issue.
Article 218 The accidental omission to give notice of the meeting to, or the non-receipt
of notice of the meeting by, any person entitled to receive notice shall not
invalidate the meeting or the resolutions made at the meeting.
CHAPTER 22: SUPPLEMENTARY
Article 219 Definitions:
(1) A "controlling shareholder" means a shareholder who holds shares
representing over 50 percent of the total share of the joint stock company; or
a shareholder having sufficient voting rights in respect of the shares he/she
holds to pose a significant influence on the resolutions of the shareholders'
meetings despite not holding over 50 percent of the total share capital of the
Company.
(2) A "de facto controller" means a natural person, legal person or
other organisation able to actually control the acts of the Company through an
investment, agreement or other arrangement.
(3) "Related relationship" means the relationship between the
controlling shareholders, de facto controller, directors and senior officer
personnel of the Company and the enterprises under their direct or indirect
control, as well as other relationships that may lead to the transfer of the
Company's
interests. However, there is no related relationship between state- controlled
enterprises only because they are under the common control of the state.
(4) "CSRC" means the China Securities Regulatory Commission.
(5) A "stock exchange" means any of the stock exchanges on which the
Company's shares are listed, which means the Shanghai Stock Exchange and/or
the Stock Exchange, as the context may require.
(6) The "listing rules of securities" means, according to the context,
the Rules Governing the Listing of Stocks on the Shanghai Stock Exchange
currently in force issued by the Shanghai Stock Exchange and/or the Hong Kong
Listing Rules, and the relevant provisions of the Shanghai Stock Exchange
and/or the relevant provisions of the Stock Exchange.
Article 220 The formulation and amendment of these Articles of Association shall come into
force after being passed by a special resolution at a shareholders' meeting.
Article 221 The matters not covered in these Articles of Association shall be dealt with
in accordance with relevant laws, administrative regulations, rules and the
listing rules of securities, in conjunction with the actual circumstances of
the Company. In the event that these Articles of Association is in conflict
with the newly promulgated relevant laws, administrative regulations, rules
and the listing rules of securities, such newly promulgated laws,
administrative regulations, rules and the listing rules of securities shall
prevail.
Article 222 These Articles of Association are written in Chinese and English. If there is
any discrepancy between the Chinese version and the English version, the
Chinese version shall prevail.
Article 223 The board of directors of the Company shall be responsible for the
interpretation of these Articles of Association. The board of directors may,
in accordance with the provisions of these Articles of Association, develops
detailed rules for implementation, which shall not violate the provisions
hereof.
Article 224 In these Articles of Association, reference to "accounting firm" shall have
the same meaning as "auditor" in Hong Kong Listing Rules.
Article 225 For the purpose of these Articles of Association, the terms "not less than"
and "within" are all inclusive terms and the terms "more than" "beyond"
"below" and "above" are exclusive terms.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END STRGIGDLLSDDGUURecent news on Air China
See all newsREG - Air China Ld - ARTICLES OF ASSOCIATION OF AIR CHINA LIMITED
AnnouncementREG - Air China Ld - POLL RESULTS OF 2024 ANNUAL GENERAL MEETING
AnnouncementREG - Air China Ld - ANNOUNCEMENT ON KEY OPERATING DATA OF MAY 2025
AnnouncementREG - Air China Ld - JOINT ANNOUNCEMENT
AnnouncementREG - Air China Ld - CIRCULAR FOR THE 2024 ANNUAL GENERAL MEETING
Announcement