Report of the Directors
(F)
Others
a.
Non-public Issue of Shares
On 10 December 2008, the Company entered into the A Shares Subscription Agreement with CSAHC, pursuant to which CSAHC has conditionally agreed to subscribe and the Company has conditionally agreed to allot and issue 721,150,000 new A Shares for a consideration of RMB2,278,834,000, equivalent to the subscription price of RMB3.16 per new A Share.
On the same date, the Company and Nan Lung (a wholly-owned subsidiary of CSAHC) entered into the H Shares Subscription Agreement, pursuant to which Nan Lung has conditionally agreed to subscribe and the Company has conditionally agreed to allot and issue 721,150,000 new H Shares for a consideration of RMB721,150,000, equivalent to the subscription price of HK$ equivalent of RMB1.00 (equivalent to approximately HK$1.13) per new H Share. The resolutions relating to the non-public issue of A Shares and H Shares were passed at the First Extraordinary General Meeting and the Class Meetings for the Year 2009 of the Company held on 26 February 2009. These resolutions shall be subject to the approval of the relevant regulatory bodies before they can be implemented.
b. Co -investment
The Company entered into the Supplemental Agreement to the Capital Contribution Agreement of Southern Airlines Culture and Media Co., Ltd. with CSAHC on 15 July 2008 pursuant to the resolution of the Board. Under the Supplemental Agreement, the Company and CSAHC agreed that the Company’s form of contribution shall be changed to injection of RMB28,684,945 in cash. Upon the completion of contribution to registered capital in cash by the Company, the shareholding structure of SACM will remain unchanged, being held as to 50% equity interest each by the Company and CSAHC.
Above connected transactions have been approved by Independent Non-executive Directors.
DONATIONS
For the year ended 31 December 2008, the Group made donations for charitable purposes amounting to RMB12,000,000.
DESIGNATED DEPOSITS AND OVERDUE TIME DEPOSITS
As at 31 December 2008, the Group’s deposits placed with financial institutions or other parties did not include any designated deposits, or overdue time deposits for which the Group failed to receive repayments.
LITIGATION
Save as disclosed in note 50(b) to the financial statements prepared under IFRS, as at 31 December 2008, the Group was not involved in any material litigations.
AUDITORS
A resolution is to be considered at the forthcoming annual general meeting of the Company for the reappointment of KPMG as the international auditors of the Company and of KPMG Huazhen as the PRC auditors of the Company.
By order of the Board Si Xian Min
Chairman
Guangzhou, the PRC 14 April 2009
32 ANNUAL REPORT 2008
Report of the Supervisory Committee
Dear Shareholders,
In 2008, the Supervisory Committee of the Company faithfully carried out their duties and obligations with diligence in accordance with the “Working Procedures for the Supervisory Committee of China Southern Airlines Company Limited” subject to the Company Law of the PRC and Articles of Association of the Company. Members of the committee participated in all Board meetings, supervised the assembly of Board meetings and the review and resolution procedure of the Board meetings, monitored the financial position of the Company and the conduct of the Directors and the senior management of the Company in discharge of their duties and their compliance with the applicable laws and regulations and the Company’s Articles of Association, in protection of the legitimate rights and interests of the shareholders and the Company as a whole.
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