Where the accountant firm’s notice of resignation contains a statement of any circumstance which should be brought to the notice of the shareholders or creditors of the Company, it may require the Board of Directors to convene an extraordinary general meeting for the purpose of receiving an explanation of the circumstances connected with its resignation.

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CHAPTER 18 CAPITAL FLOW BETWEEN THE COMPANY AND ITS RELATED PARTIES AND EXTERNAL GUARANTEE PROVIDED BY THE COMPANY

Article 284 Fund transactions between the Company and controlling shareholders and other related parties shall be subject to the following regulations:

(1) Use of funds of the Company shall be strictly limited during transaction of operating funds between the Company and controlling shareholders and other related parties. Controlling shareholders and other related parties shall not request the Company to pay for their salaries, benefits, insurance and advertisement during the period, nor shall the parties undertake any cost or other outgoings for each other.

(2) The Company shall not directly or indirectly provide funds for use by controlling shareholders or other related parties by:

1. lending the Company’s funds with or without consideration for use by controlling shareholders or other related parties;

2. assignment of loans for related parties through banks or non- banking financial bodies;

3. entrusting controlling shareholders or other related parties to carry out investments;

4. issuance of commercial acceptance notes without real transactions background for controlling shareholders or other related parties;

5. repaying debts for controlling shareholders or other related parties;

6. other means as prohibited by China Securities Regulatory
Commission.

(3) During auditing work for the Company’s annual financial reports, the certified public accountants shall, based on the aforesaid regulations, present their specific explanation on particulars of the usage of fund of the Company by controlling shareholders or other related parties, while the Company shall accordingly publish the specific explanation.

Article 285 All directors of the Company shall perform due diligence on and strictly control liability risks incurred as a result of external guarantee, and shall by law accept related liability for loss arising from contravening or improper external guarantee. Controlling shareholders and other related parties shall not force the Company to provide guarantee to others.

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Article 286 The Company shall provide external guarantee (including assets pledge) based on the principles of fairness, willingness, sincerity and mutual benefits. The procedure for approval of external guarantee provided by the Company is as follows:

(1) As required by the PRC laws and regulations and the listing rules of stock exchange in the place where the Company’s shares are listed, the Company’s external guarantee shall be subject to written consent by two thirds of all members of the Board of Directors or approval from shareholders’ general meetings. Scope of authority of the Board of Directors is provided in the Company’s “Rules of Procedures for Board of Directors”;

(2) Prior to decision on provision of guarantee to external parties (or before it is submitted to the shareholders’ general meeting for voting), the Board of Directors of the Company shall be well informed of particulars of the debtors, and completely analyse and fully disclose in relevant announcements the benefits and risks from such guarantee;

(3) When a resolution in relation to external guarantee is to be passed at the shareholders’ general meeting or by the Board of Directors, any shareholders or directors that have a conflict of interests with such guarantee shall abstain from voting;
　
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本文鏈接地址：Articles of Association of China Southern Airlines Company L(54)