China Aviation Oil Singapore : Letter to Shareholders dated 31 March 2022 415.3 KB

LETTER TO SHAREHOLDERS

in relation to

• (1) THE PROPOSED RENEWAL OF THE GENERAL MANDATE FOR INTERESTED PERSON TRANSACTIONS; AND

• (2) THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE.

TABLE OF CONTENTS

DEFINITIONS ....................................................................................................................................... 3

LETTER TO SHAREHOLDERS ........................................................................................................... 11

1.	INTRODUCTION ........................................................................................................................	11
2.	THE PROPOSED RENEWAL OF THE IPT MANDATE .............................................................	12
3.	THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE .................................	13
4.	SHAREHOLDERS WHO WILL ABSTAIN FROM VOTING ........................................................	26
5.	DIRECTORS WHO WILL ABSTAIN FROM VOTING .................................................................	26
6.	DIRECTORS' AND SUBSTANTIAL SHAREHOLDERS' INTERESTS IN THE COMPANY .......	27
7.	DIRECTORS' RECOMMENDATIONS ........................................................................................	27
8.	DIRECTORS' RESPONSIBILITY STATEMENT .........................................................................	27
28
30
48

ANNEX I GENERAL INFORMATION RELATING TO CHAPTER 9 OF THE LISTING MANUAL .....

ANNEX II GENERAL MANDATE FOR INTERESTED PERSON TRANSACTIONS ..........................

ANNEX III LIST OF INTERESTED PERSONS ...................................................................................

DEFINITIONS

In this Letter, the following definitions shall apply throughout unless the context otherwise requires or unless otherwise stated:

Entities

"Bluesky"

• : China National Aviation Fuel South China Bluesky Corporation Ltd (华南蓝天航空油料有限公司), a subsidiary of CNAFCL

  "BP"

• : BP p.l.c., an indirect Controlling Shareholder of the Company

  "BP Group"

• : BP and its associates

  "BPIA"

• : BP Investments Asia Limited, an indirect subsidiary of BP and a Controlling Shareholder of the Company

  "BPS"

• : BP Singapore Pte. Limited, an indirect subsidiary of BP

  "CAO" or "Company"

• : China Aviation Oil (Singapore) Corporation Ltd

  "CAO Group"

• : The Company and its unlisted subsidiaries (i.e. which are not listed on the SGX-ST or an approved exchange), and the unlisted (as defined herein) associated companies of the Company over which the Company and its subsidiaries, or the Company and its subsidiaries and its interested persons, have Control

  "CAO HK"

• : China Aviation Oil (Hong Kong) Company Limited, a wholly-owned subsidiary of the Company

  "CNAF"

• : China National Aviation Fuel Group Limited (中国航空油料集团 有限公司) formerly known as China National Aviation Fuel Group Corporation (中国航空油料集团公司), the holding company of the Company

  "CNAF Finance"

• : China National Aviation Fuel Finance Co., Ltd (中国航油集团财务 有限公司), a subsidiary of CNAF

  "CNAF Group"

• : CNAF and its associates

  "CNAF HKR"

• : CNAF Hong Kong Refuelling Limited (中国航油香港供油有限公 司), an associate of CNAF

  "CNAF Logistics"

• : China National Aviation Fuel Logistics Co., Ltd (中国航油集团物 流有限公司), a subsidiary of CNAF

  "CNAFCL"

• : China National Aviation Fuel Corporation Ltd (中国航空油料有限 责任公司), a subsidiary of CNAF

  "Group"

• : The Company and its subsidiaries

  "LandOil"

• : China National Aviation Fuel Petroleum Co., Ltd (中国航油集团石 油股份有限公司), a subsidiary of CNAF

  "TSN-PEKCL"

• : China National Aviation Fuel TSN-PEK Pipeline Transportation Corporation Ltd (中国航油集团津京管道运输有限责任公司), a 49-per cent owned associated company of the Company and an associate of CNAF

General

"2017 AGM"

• : The annual general meeting of the Company held on 18 April 2017

  "2021 AGM"

• : The annual general meeting of the Company held on 28 April 2021

  "2021 Annual Report"

• : Annual report of the Company for FY2021

  "AGM"

• : The forthcoming 28th annual general meeting of the Company

  "Approved Entities"

• : The Investee Companies and other members of the CNAF Group

  "Audit Committee"

• : The audit committee of the Company, comprising Independent Non-Executive Directors, Mr Teo Ser Luck, Mr Hee Theng Fong and Dr Fu Xingran, and Non-Independent, Non-Executive Directors, Mr Zhang Yuchen and Dr Richard Yang Minghui, as at the date of this Letter

  "Average Barrel Price"

• : The yearly average market price per barrel of KERO, which shall be the arithmetic average of the mean of the daily high and low quotations for KERO under the heading "FOB SINGAPORE - MARKET LOCATION" as published in Platts Asia-Pacific/Arab Gulf Marketscan, effective for the calendar month prior to the date of the relevant transaction

  "Beijing Airport"

• : Beijing Capital International Airport

  "Bluesky Supply Agreement"

• : The supply agreement entered into by the Company and Bluesky dated 1 April 2010 relating to the terms of the supply arrangements between the Company and Bluesky, which was previously renewed and extended to 1 April 2018, further renewed and extended to 1 April 2020, and further extended to 1 April 2022. On 13 January 2022, the Bluesky Supply Agreement was further renewed and extended to 1 April 2024 on substantially similar terms. The Audit Committee had reviewed the terms of the proposed extension of the Bluesky Supply Agreement prior to entry into the agreement.

  "Board"

• : The board of Directors of the Company

  "BPIA Director"

• : Dr Richard Yang Minghui who is a Non-Independent and Non-Executive Director of the Company

  "CDP"

• : The Central Depository (Pte) Limited

  "CFR"

• : The acronym for the Incoterm "Cost and Freight" which indicates that the seller/exporter/manufacturer clears the goods for export and is responsible for the costs for transport of the goods to the port of destination. The buyer bears the risk of loss of the goods once the goods pass the ship's rail at the port of shipment (and not destination)

"CNAF Directors"

• : Mr Gong Feng (Chairman of the Company, Non-Independent, Non-Executive Director of the Company), Mr Wang Yanjun (Chief Executive Officer/Executive Director of the Company), Mr Shi Lei (Non-Independent, Non-Executive Director of the Company) and Mr Zhang Yuchen (Non-Independent, Non-Executive Director of the Company)

  "CNAFCL Supply Agreement"

• : The supply agreement entered into by the Company and CNAFCL dated 23 March 2010 relating to the terms of the supply arrangements between the Company and CNAFCL, the term of which was previously renewed and extended to 6 August 2018, and was further renewed and extended to 6 August 2020, and was further extended to 6 August 2022. On 13 January 2022, the CNAFCL Supply Agreement was further extended to 6 August 2024 on substantially similar terms. The Audit Committee had reviewed the terms of the proposed extension of the CNAFCL Supply Agreement prior to entry into the agreement.

  "Code"

• : The Singapore Code on Take-overs and Mergers

  "Companies Act"

• : The Companies Act 1967

  "Constitution"

• : The Constitution of the Company currently in force

  "Control"

• : The capacity to dominate decision-making, directly or indirectly, in relation to the financial and operating policies of the Company

  "Controlling Shareholder"

  "Deposit Banks"

• : In relation to a listed company, a person who:

  • (a) holds directly or indirectly fifteen per cent. (15%) or more of the total voting rights in the company. The SGX-ST may determine that a person who satisfies the above is not a Controlling Shareholder; or

  • (b) in fact exercises Control over the company

• : The banks which CNAF Finance holds primary accounts with, such as Agricultural Bank of China Co., Ltd and PingAn Bank Co., Ltd

  "Derivative Financial Instruments"

• : Derivative financial instruments including but not limited to all futures and swaps products available in the energy and freight markets

  "Director"

• : A director of the Company as at the date of this Letter

  "Entrust Loan Arrangement Services"

• : The services of a duly licensed financial institution in the PRC to provide loans on behalf of a person to another person in the PRC

  "EPS"

• : Earnings per Share

  "Executive Director"

• : A Director who is an employee of and performs an executive function for the Company