AVIC Chengdu Aircraft Industrial (Group) Co., Ltd. announced that it has entered into a framework agreement for the private placement of common shares on August 18, 2015. The transaction will include participation from new investors AviChina Industry & Technology Company Limited, AVIC Capital Co., Ltd., China Avionics Systems Co.,Ltd., AVIC Aircraft Co., Ltd., and AVIC Electromechanical Systems Co., Ltd. The company reported total assets of CNY 18,880,760,000, operating revenue of CNY 11,519,450,000, gross profit of CNY 464,970,000, and equity of CNY 5,871,670,000 for the year ended December 31, 2014. The investors will invest a total of CNY 4,988,870,000 in the company and Shenyang Aircraft Group collectively, of which AVIC Capital Co., Ltd. will invest CNY 1,906,225,000 in the two companies, China Avionics Systems Co.,Ltd. will invest CNY 539,190,000 in the two companies, AVIC Aircraft Co., Ltd. will invest CNY 441,160,000 in the two companies, AviChina Industry & Technology Company Limited will invest CNY 1,906,225,000 in the two companies, and AVIC Electromechanical Systems Co., Ltd. will invest CNY 196,070,000 in the two companies . The investors agreed that, if any of the investor except AVIC Capital Co., Ltd., having gone through its decision-making procedures of its internal authorities, decides not to participate in the subscription of the proposed capital increases or participate to the maximum amount in the proposed capital increases, AVIC Capital Co., Ltd. has the priority to subscribe the full amount that has not been subscribed or the difference that has not been subscribed by any of the investors and the capital increase amount contributed by each investor would accordingly be adjusted.

The agreement will be executed after being signed by the legal representatives or authorized representatives of the parties and affixed with the respective company seals, and become effective upon completion of all the conditions; including the decision-making procedures of internal authorities relating to the proposed capital increases having been completed by each of the parties and the respective valuation results of Shenyang Aircraft Group and the company as at the valuation date having been approved by and filed with the relevant state-owned assets supervision and management authority. The transaction was approved at the 42nd session of the 6th directorate meeting of AVIC Capital Co., Ltd. and at the 5th meeting of 2015 of the 5th directorate of China Avionics Systems Co.,Ltd. The transaction has been approved at the 27th session of the 5th directorate meeting of AVIC Electromechanical Systems Co., Ltd. and 35th session of the 6th directorate of AVIC Aircraft Co., Ltd.