CStone Pharmaceuticals - Proxy Solicitation & Information Statement 2019

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt about any of the contents of this circular or as to what action to take in relation to this circular, you should consult your licensed securities dealer, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Yanzhou Coal Mining Company Limited , you should at once hand this circular to the purchaser(s) or transferee(s) or to the bank, or a licensed securities dealer or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

This circular is for information only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities in the Company.

兗州煤業股份有限公司

YANZHOU COAL MINING COMPANY LIMITED

(A joint stock limited company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 1171)

(1) PROPOSED APPOINTMENT OF NON-INDEPENDENT DIRECTOR; (2) PROPOSED RENEWAL OF LIABILITY INSURANCE FOR DIRECTORS, SUPERVISORS AND SENIOR OFFICERS; (3) PROPOSAL FOR APPOINTMENT OF EXTERNAL AUDITING FIRM FOR THE YEAR 2019;

(4) PROPOSAL TO AUTHORIZE THE COMPANY TO CARRY OUT DOMESTIC AND OVERSEAS FINANCING ACTIVITIES;

(5) PROPOSAL FOR THE PROVISION OF FINANCIAL GUARANTEES TO THE SUBSIDIARIES AND GRANTING OF AUTHORIZATION TO YANCOAL AUSTRALIA AND ITS SUBSIDIARIES TO PROVIDE GUARANTEES FOR THE DAILY OPERATION OF THE SUBSIDIARIES OF THE COMPANY IN AUSTRALIA;

(6) PROPOSAL FOR THE GENERAL MANDATES TO ISSUE H SHARES AND REPURCHASE H SHARES;

(7) PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION; AND

(8) PROPOSED STORAGE ISSUANCE OF CORPORATE BONDS AND RELEVANT AUTHORIZATION

The notices convening the AGM and the H Shareholders’ Class Meeting to be held at the headquarters of the Company at 298 South Fushan Road, Zoucheng, Shandong Province 273500, the PRC at 8:30 a.m. and 11:00 a.m. respectively on Friday, 24 May 2019 were published on 8 April 2019, and the supplementary notice of the AGM was published on 26 April 2019.

Whether or not you are able to attend the respective meetings in person, you are strongly advised to complete and sign the form of proxy in accordance with the instructions printed thereon. The form of proxy shall be lodged with the Company’s H Share Registrar, Hong Kong Registrars Limited at 17M/F, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong (for holders of H Shares) or the Office of the Secretary to the Board at 298 South Fushan Road, Zoucheng, Shandong Province 273500, the PRC (for holders of A Shares) as soon as possible but in any event not later than 24 hours before the time appointed for the holding of the relevant meeting(s) or any adjourned meeting(s) (as the case may be).

Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting(s) or any adjourned meeting(s) should you so wish.

8 May 2019

CONTENTS

		Page
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		1
LETTER	FROM THE BOARD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
I.	INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
II.	PROPOSED APPOINTMENT OF
	NON-INDEPENDENT DIRECTOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
III.	PROPOSED RENEWAL OF LIABILITY INSURANCE
	FOR DIRECTORS, SUPERVISORS AND SENIOR OFFICERS . . . . . . . . .	5
IV.	PROPOSAL FOR APPOINTMENT OF EXTERNAL AUDITING
	FIRM FOR THE YEAR 2019. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
V.	PROPOSAL TO AUTHORIZE THE COMPANY TO CARRY OUT
	DOMESTIC AND OVERSEAS FINANCING ACTIVITIES . . . . . . . . . . . .	6
VI.	PROPOSAL FOR THE PROVISION OF FINANCIAL GUARANTEES
	TO THE SUBSIDIARIES AND GRANTING OF AUTHORIZATION
	TO YANCOAL AUSTRALIA AND ITS SUBSIDIARIES TO
	PROVIDE GUARANTEES FOR THE DAILY OPERATION OF
	THE SUBSIDIARIES OF THE COMPANY IN AUSTRALIA. . . . . . . . . . .	7
VII.	PROPOSAL FOR THE GENERAL MANDATES TO ISSUE
	H SHARES AND REPURCHASE H SHARES . . . . . . . . . . . . . . . . . . . . . .	8
VIII.	DETAILS OF PROPOSED AMENDMENTS TO
	THE ARTICLES OF ASSOCIATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	10
IX.	PROPOSED STORAGE ISSUANCE OF CORPORATE BONDS
	AND RELEVANT AUTHORIZATION . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12
X.	AGM, A SHAREHOLDERS’ CLASS MEETING AND
	H SHAREHOLDERS’ CLASS MEETING . . . . . . . . . . . . . . . . . . . . . . . . .	16
XI.	CLOSURE OF H SHARE REGISTER OF MEMBERS OF
	THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	18
XII.	RECOMMENDATION OF THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . .	19
XIII.	ADDITIONAL INFORMATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19
XIV.	RESPONSIBILITY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19
APPENDIX I EXPLANATORY STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . .		20
APPENDIX II BIOGRAPHICAL DETAILS OF THE CANDIDATE
	FOR THE ELECTION OF DIRECTOR. . . . . . . . . . . . . . . . . . . .	25

– i –

DEFINITIONS

In this circular, unless the context requires otherwise, the following expressions have the following meaning:

“A Shareholders”

holders of A Shares;

“A Shareholders’ Class Meeting” the 2019 second class meeting of A Shareholders to be held at the headquarters of the Company at 298 South Fushan Road, Zoucheng, Shandong Province 273500, the PRC at 10:30 a.m. on Friday, 24 May 2019;
“A Shares”
domestic shares in the ordinary share capital of the Company, with a nominal value of RMB1.00 each, which are subscribed for and fully paid in RMB and are listed on the Shanghai Stock Exchange;
“AGM” the 2018 annual general meeting of the Company to be held at the headquarters of the Company, 298 South Fushan Road, Zoucheng, Shandong Province 273500, the PRC at 8:30 a.m. on Friday, 24 May 2019;
“Articles of Association” the articles of association of the Company;
“associate(s)”
has the same meaning ascribed thereto under the Listing Rules;
“AUD” Australian dollars, the lawful currency of Australia;
“Board” the board of Directors of the Company;
“Bonds” the corporate bonds of not more than RMB20 billion (inclusive) in principal amount proposed to be issued by the Company to qualified investors in the PRC;
“Company” or “Yanzhou Coal” 兗州煤業股份有限公司, Yanzhou Coal Mining Company Limited, a joint stock limited company incorporated in the PRC and the H Shares and A Shares of which are listed on the Hong Kong Stock Exchange and the Shanghai Stock Exchange, respectively;
“Company Law” Company Law of the People’s Republic of China, as revised from time to time;
“CSRC” China Securities Regulatory Commission;
“Director(s)” the directors of the Company;
“H Shareholders” holders of H Shares;

– 1 –

DEFINITIONS

“H Shareholders’ Class Meeting”
the 2019 second class meeting of H Shareholders to be held at the headquarters of the Company at 298 South Fushan Road, Zoucheng, Shandong Province 273500, the PRC at 11:00 a.m. on Friday, 24 May 2019;
“H Shares” overseas-listed foreign-invested shares in the ordinary share capital of the Company with a nominal value of RMB1.00 each, which are listed on the Hong Kong Stock Exchange;
“Hong Kong” The Hong Kong Special Administrative Region of the PRC;
“Hong Kong Listing Rules” or “Listing Rules”
the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, as revised from time to time;
“Hong Kong Stock Exchange”
The Stock Exchange of Hong Kong Limited;
“Issuance”
the proposed issuance of the Bonds;
“Latest Practicable Date”
29 April 2019, being the latest practicable date of ascertaining certain information contained in this circular before the issuing of this circular;
“PRC”
The People’s Republic of China excluding, for the purpose of this circular only, Hong Kong, Macau Special Administrative Region of the PRC and Taiwan;
“Repurchase Mandate”
subject to the conditions set out in each of the proposed special resolution approving the Repurchase Mandate at the AGM, the A Shareholders’ Class Meeting and the H Shareholders’ Class Meeting, the general mandate given to the Board to exercise the power to repurchase H Shares not exceeding 10% of the aggregate nominal value of H Shares of the Company in issue as at the date of the passing of the resolution;
“RMB”
Renminbi, the lawful currency of the PRC;
“SAFE”
The State Administration of Foreign Exchange of the PRC;
“Shareholders”
the shareholders of the Company;
“SSE”
the Shanghai Stock Exchange;

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DEFINITIONS

“Supervisory Committee” the supervisory committee of the Company; “Yankuang Group” Yankuang Group Company Limited* （兗礦集團有限公司）, a state-controlled limited liability company, is the controlling shareholder of the Company holding directly and indirectly approximately 51.81% of the total issued share capital of the Company as at the Latest Practicable Date; “Yancoal Australia” Yancoal Australia Limited, a controlled overseas subsidiary of the Company, the shares of which are listed on the Australian Stock Exchange (Stock Code: YAL) and the Hong Kong Stock Exchange (Stock Code: 3668); “%” per cent.

For identification purposes only.

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LETTER FROM THE BOARD

兗州煤業股份有限公司 YANZHOU COAL MINING COMPANY LIMITED

(A joint stock limited company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 1171)

Directors: Li Xiyong Li Wei Wu Xiangqian Wu Yuxiang Guo Dechun Zhao Qingchun Guo Jun

Independent non-executive Directors: Kong Xiangguo Cai Chang Poon Chiu Kwok Qi Anbang

Registered office: 298 South Fushan Road Zoucheng Shandong Province PRC Postal Code: 273500

Principal place of business in Hong Kong: 40th Floor, Sunlight Tower 248 Queen’s Road East Wanchai Hong Kong

8 May 2019

To the Shareholders

Dear Sir or Madam,

(4) PROPOSAL TO AUTHORIZE THE COMPANY TO CARRY OUT DOMESTIC AND OVERSEAS FINANCING ACTIVITIES; (5) PROPOSAL FOR THE PROVISION OF FINANCIAL GUARANTEES TO THE SUBSIDIARIES AND GRANTING OF AUTHORIZATION TO YANCOAL AUSTRALIA AND ITS SUBSIDIARIES TO PROVIDE GUARANTEES FOR THE DAILY OPERATION OF THE SUBSIDIARIES OF THE COMPANY IN AUSTRALIA;

(6) PROPOSAL FOR THE GENERAL MANDATES TO ISSUE H SHARES AND REPURCHASE H SHARES;

(7) PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION; AND

(8) PROPOSED STORAGE ISSUANCE OF CORPORATE BONDS AND RELEVANT AUTHORIZATION

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LETTER FROM THE BOARD

I. INTRODUCTION

The purpose of this circular is to provide you with information relating to (1) the proposed appointment of non-independent Director; (2) the proposed renewal of liability insurance for Directors, supervisors and senior officers of the Company; (3) the proposal for appointment of external auditing firm for the year 2019; (4) the proposal to authorize the Company to carry out domestic and overseas financing activities; (5) the proposal for the provision of financial guarantees to the subsidiaries and granting of authorization to Yancoal Australia and its subsidiaries to provide guarantees for the daily operation of the subsidiaries of the Company in Australia; (6) the proposal for the general mandates to issue H Shares and repurchase H Shares; and (7) the proposed amendments to the Articles of Association; (8) the proposed storage issuance of corporate bonds and relevant authorization.

II. PROPOSED APPOINTMENT OF NON-INDEPENDENT DIRECTOR

The Board received the written resignation letter from Mr. Wu Yuxiang (“ Mr. Wu ”) on 28 March 2019. Mr. Wu applied to resign from the position of the Director of the Company due to work adjustment.

Mr. Wu will continue to perform his duties as the Director of the Company according to the relevant laws, regulations and the Articles of Association of the Company prior to the election and appointment of the new Director at the general meeting of the Company.

The twenty-fourth meeting of the seventh session of the Board approved the “Proposal in relation to appointment of the Director of Yanzhou Coal Mining Company Limited” on 29 March 2019, and proposed to nominate Mr. Liu Jian as the candidate of the executive Director of the Company and approved to submit the same to the AGM of the Company for discussion and consideration.

The biographical details of Mr. Liu Jian are set out in Appendix II to this circular. Ordinary resolutions to approve his election will be proposed at the AGM.

III. PROPOSED RENEWAL OF LIABILITY INSURANCE FOR DIRECTORS, SUPERVISORS AND SENIOR OFFICERS

It is proposed that the Company will renew the liability insurance for the Directors, supervisors and senior officers of the Company for a maximum insured amount of USD15 million.

IV. PROPOSAL FOR APPOINTMENT OF EXTERNAL AUDITING FIRM FOR THE YEAR 2019

It is proposed that ShineWing Certified Public Accountants (special general partnership) and SHINEWING (HK) CPA Limited be appointed as the Company’s domestic and international auditors for the year 2019, respectively, until the conclusion of the next annual general meeting of the Company, and arrangements in respect of their remuneration be approved.

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LETTER FROM THE BOARD

It is proposed that the remuneration to be paid to the auditors in 2019 is as follows:

the auditing fees for the domestic and overseas operations in 2019 will be RMB8.6 million. The Company will reimburse the accountants with accommodation expense during their work in the Company, excluding the travel expense and other expenses.
to authorize the Board to decide the payment for increased follow-up auditing, internal control audit and other services resulted from the Company’s new subsidiaries or changes of regulations.

V. PROPOSAL TO AUTHORIZE THE COMPANY TO CARRY OUT DOMESTIC AND OVERSEAS FINANCING ACTIVITIES

In order to optimise the Company’s debt structure, reduce the debt ratio of the Company and satisfy the capital demands of the Company’s production and operations and projects, subject to the relevant laws, regulations as well as listing rules in places where the Company’s securities are listed, the Board proposed:

1) To approve the Company or its controlled subsidiaries to carry out financing activities of aggregate amount not exceeding the equivalent of RMB50 billion and to determine the financing currency and methods based on merits of market conditions, which are restricted to the following financing methods only: bank loans, corporate bonds, medium-term notes, short-term bonds, super short-term bonds, renewable bonds, perpetual bonds, perpetual medium-term notes, private placement bonds, operating lease, financing lease, asset securitization, asset-backed notes, financing on transfer of right of return over assets, debt-to-equity funds, private placement of industry funds, acceptance of insurance, the equity investment and bonds investment in the controlled subsidiaries by the subsidiaries of the trust and public offering funds.
2) To authorize the chairman of the Board to deal with all matters in respect of the abovementioned financing businesses in accordance with the relevant laws and regulations, which include but are not limited to the followings:
(1) in light of the Company’s situation and the market conditions, and according to the relevant laws, rules and the requirements of regulatory authorities, to formulate and adjust specific plan in relation to such financing activities, including but not limited to the determination of the suitable entity to carry out the financing activities, the amounts, methods, terms and other matters related to financing activities;
(2) to determine the engagement of intermediaries and to sign and implement all agreements and documents in respect of the financing activities and disclose the relevant information;

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LETTER FROM THE BOARD

  - (3) to deal with the reporting, registration, approval of the materials in respect of the financing activities provided to the domestic and overseas regulatory authorities and other relevant authorities, and other relevant matters.

3) the aforementioned authorization shall become valid after the date of conclusion of the AGM at which this proposal is considered until the date of conclusion of the next annual general meeting of the Company, except where the circumstances require the person(s) so authorized to exercise his powers after the expiry of the term of authorization in relation to any contracts, agreements or decisions regarding the financial guarantees that have been made within the term of authorization.
VI. PROPOSAL FOR THE PROVISION OF FINANCIAL GUARANTEES TO THE SUBSIDIARIES AND GRANTING OF AUTHORIZATION TO YANCOAL AUSTRALIA AND ITS SUBSIDIARIES TO PROVIDE GUARANTEES FOR THE DAILY OPERATION OF THE SUBSIDIARIES OF THE COMPANY IN AUSTRALIA

The Board proposed:

1) in order to reduce financing costs of the subsidiaries and ensure the normal operation funding needs of the subsidiaries, to approve the provision of financial guarantee(s) of an aggregate amount not exceeding the equivalent of US$4 billion by the Company to its wholly-owned and controlled subsidiaries;
2) in order to satisfy the requirements of ordinary operations of the Company’s assets and subsidiaries in Australia and further reduce the operating cost, in accordance with the Australian Corporate Law and relevant laws and regulations, to approve the provision of guarantees by Yancoal Australia and its subsidiaries for an amount not exceeding AUD1.2 billion to the subsidiaries of the Company in Australia for their daily operations;
3) to approve and authorize the chairman of the Board to deal with matters in relation to the aforesaid financial guarantees in accordance with the relevant laws, regulations and rules, such matters include but are not limited to the following:
(1) to determine the appropriate wholly-owned or controlled subsidiaries which will be provided with the guarantees based on their financing needs;
(2) to determine the exact terms and conditions of the guarantee agreements, which include but are not limited to the amount, term, scope and method of guarantee; and to execute the guarantee agreement(s) involved and other relevant legal documents;
(3) to deal with the filing and reporting of documents in respect of the guarantee(s) and other relevant matters; and

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LETTER FROM THE BOARD

4) that the aforementioned authorization shall become valid from the date of conclusion of the AGM at which this resolution is considered until the date on which the next annual general meeting of the Company is concluded, except where the circumstances require the person(s)so authorized to exercise his powers after the expiry of the term of authorization in relation to any contracts, agreements or decisions regarding the financial guarantees that have been made within the term of authorization.

VII. PROPOSAL FOR THE GENERAL MANDATES TO ISSUE H SHARES AND REPURCHASE H SHARES

To ensure flexibility and to grant discretion to the Board to issue H Shares, the Company will put forward a resolution at the AGM to grant a general mandate to the Board to allot, issue and deal with H Shares of up to a maximum of 20% of the aggregate nominal value of H Shares of the Company in issue as at the date of passing of the resolution.

To ensure flexibility and to grant discretion to the Directors to repurchase any H Shares in appropriate circumstances (including where such repurchase may lead to an enhancement of the net asset value per Share and/or the earnings per Share), the Company will put forward a special resolution at the AGM, the A Shareholders’ Class Meeting and the H Shareholders’ Class Meeting, respectively, to grant the Repurchase Mandate to the Board to repurchase H Shares not exceeding 10% of the aggregate nominal value of H Shares of the Company in issue as at the date of passing of the resolution approving the Repurchase Mandate.

The Company Law (to which the Company is subject) provides that a joint stock limited company incorporated in the PRC may not repurchase its shares unless such repurchase is effected for (a) reducing its share capital; (b) a merger with another entity that holds the shares of the Company; (c) granting shares for the employee stock ownership plan or share incentive; (d) the repurchase is made at the request of its shareholders who disagree with shareholders’ resolutions in connection with merger or division of the company; (e) the repurchased shares are used for the corporate bonds convertible into shares of the listed company; or (f) the repurchase is necessary for maintaining the value of the listed company and the interests of its shareholders. The Articles of Association provide that, subject to obtaining the approval of the relevant regulatory authorities and complying with the Articles of Association, share repurchase may be effected by the Company for the reduction of its share capital, a merger between itself and another entity that holds its shares, the employee stock ownership plan or share incentive, the request of its shareholders who disagree with shareholders’ resolutions in connection with merger or division of the company, the conversion of convertible corporate bonds issued by the listed company, maintenance of the value of the company and the interests of its shareholders, or in circumstances permitted by law or administrative regulations.

The Hong Kong Listing Rules permit shareholders of a PRC joint stock limited company to grant a general mandate to the board of directors to repurchase H shares of such company that is listed on the Hong Kong Stock Exchange. Such mandate is required to be given by way of a special resolution passed by shareholders at the AGM and special resolutions passed by holders of A shares and holders of H shares in separate class meetings.

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LETTER FROM THE BOARD

As the H Shares are traded on the Hong Kong Stock Exchange in Hong Kong dollars and the price payable by the Company for any repurchase of H Shares will, therefore, be paid in Hong Kong dollars, the approvals of SAFE and other relevant government authorities are required for any repurchase of H shares.

In accordance with the requirements of the Articles of Association applicable to capital reduction, prior to exercising the Repurchase Mandate, the Company will have to notify its creditors in writing of the passing of such special resolutions and the possible reduction of the registered capital of the Company. The Company shall notify its creditors within 10 days after the passing of such special resolutions and also by way of publication of announcement in newspaper at three occasions within 30 days after the passing of such special resolutions. Creditors then have a period of up to 30 days after the Company’s written notification or if no such notification has been received, up to 45 days after the first publication of the newspaper announcement to require the Company to repay amounts due to them or to provide guarantees in respect of such amounts.

The Repurchase Mandate will be conditional upon (a) the special resolution for the grant of the Repurchase Mandate being approved at the AGM; (b) the special resolution for the grant of the Repurchase Mandate being approved at the H Shareholders’ Class Meeting and the A Shareholders’ Class Meeting; (c) the approvals of the SAFE and/or any other regulatory authorities (if applicable) as required by the laws, rules and regulations of the PRC being obtained; and (d) the Company not being required by any of its creditors to repay or to provide guarantee in respect of any amount due to any of them (or if the Company is so required by any of its creditors, the Company having, in its absolute discretion, repaid or provided guarantee in respect of such amount) pursuant to the provisions of the Articles of Association. If the Company determines to repay any amount to any of its creditors in circumstances described under condition (d) above, it expects to do so out of its internal resources. If the above conditions are not fulfilled, the Repurchase Mandate will not be exercised by the Board.

The Repurchase Mandate would expire on the earliest of (a) the conclusion of the next annual general meeting of the Company following the passing of the relevant special resolutions at the AGM, the A Shareholders’ Class Meeting and the H Shareholders’ Class Meeting; (b) the expiration of a 12-month period following the passing of the relevant special resolutions at the AGM, the A Shareholders’ Class Meeting and the H Shareholders’ Class Meeting; or (c) the date on which the authority conferred by the relevant resolutions is revoked or varied by a special resolution of the Shareholders at a general meeting or by H Shareholders or A Shareholders at their respective class meetings.

The total number of H Shares which may be repurchased pursuant to the Repurchase Mandate shall not exceed 10% of the aggregate nominal value of H Shares in issue as at the date of passing of the resolutions approving the Repurchase Mandate.

Details of the special resolutions to be proposed at the AGM, the A Shareholders’ Class Meeting and the H Shareholders’ Class Meeting in relation to the granting of the Repurchase Mandate to the Board are set out respectively in the notice of the AGM, the notice of the A Shareholders’ Class Meeting and the notice of the H Shareholders’ Class Meeting.

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LETTER FROM THE BOARD

Explanatory statement

An explanatory statement containing all relevant information relating to the Repurchase Mandate is set out in Appendix I to this circular. The information in the explanatory statement is to provide you with the information reasonably necessary to enable you to make an informed decision on whether to vote for or against the resolution to grant to the Board the Repurchase Mandate.

VIII. DETAILS OF PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

The proposal in relation to the proposed amendments to the Articles of Association was approved at the twenty-fourth meeting of the seventh session of the Board, and the Board agreed to submit the same to the AGM for consideration and approval.

In response to the supply-side reform and environmental protection policies of the state and in order to maintain the sustainable and healthy development of the marketing and trading businesses of the Company, taking into account of the actual operating conditions of the Company, the Company proposed to amend the scope of business in the Articles of Association.

Details of the proposed amendments are set out as follows:

The original Article 12 of the Articles of Association

“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.

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LETTER FROM THE BOARD

training (skills training for first aid team members, manufacturing technology training, safety training); measurement examination, physical and chemical inspection, non-destructive testing, analytical testing, manufacturing safety testing and inspection; corporate management; corporate management consulting; corporate planning and design; market investigation; economic and trade consulting; technology promotion, technology services; sale of lubricating oil, lubricating grease, chemical raw material and chemical engineering products (excluding dangerous chemical products), coat, labour protection products, spinning products, cultural and educational products, plastic products, instruments and apparatuses, cement and fire-resistant materials and products (Items which need approvals according to the laws shall be subject to the approvals of relevant authorities before operation activities can be carried out).”

The above paragraphs are proposed to be amended as follows:

“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 business scope of the company includes: mining & washing and sales of coal (among others, the export of coal should be made through companies with coal export right according to the existing state regulations); sales of coal water slurry ; outbound investment using the company’s own fund and investment consulting; commission business; transportation of goods through self-owned railway within the mining area; transportation of goods through highway; operation of ports; manufacture, sale, lease, repair, installation and dismantlement of machinery and equipment in the mining area; production and sale of other mining materials; sale and lease of electronic equipment and sale of parts; general contracting of mine engineering construction projects and contracting of electromechanical engineering construction projects; leasing of construction mechanical equipment; sale of metallic materials, electronic products, construction materials, timber and rubber products; production and sale of cold patch, soap, anchoring agent and coat; composition of mining, science and technological services; mining rescue technology services; property development within the mining areas, property leasing and provision of services such as dining and accommodation; production and sale of coal residual stones as construction materials; sale of coke, iron ore and nonferrous metals; import and export of goods and technology; warehousing (excluding hazardous chemicals); automobile repairs; labour dispatch; property management service, landscaping; sewage treatment; heat supply; industrial tourism; corporate internal staff training (skills training for first aid team members, manufacturing technology training, safety training); measurement examination, physical and chemical inspection, non-destructive testing, analytical testing, manufacturing safety testing and inspection; corporate management; corporate management consulting; corporate planning and design; market investigation; economic and trade consulting; technology promotion, technology services; sale of lubricating oil, lubricating grease, chemical raw material and chemical engineering products (excluding dangerous chemical products), coat, labour protection products, spinning products, cultural and educational products, plastic products, instruments and apparatuses, cement and

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LETTER FROM THE BOARD

fire-resistant materials and products (Items which need approvals according to the laws shall be subject to the approvals of relevant authorities before operation activities can be carried out).”

IX. PROPOSED STORAGE ISSUANCE OF CORPORATE BONDS AND RELEVANT AUTHORIZATION

The proposal in relation to the proposed storage issuance of corporate bonds and relevant authorization was approved at the twenty-fifth meeting of the seventh session of the Board, and the Board agreed submit the same to the AGM for consideration and approval.

The Company has successfully joined the list of the First Batch of High-quality Corporate Bonds Issuers compiled by the CSRC and is entitled to the “Green Channel” in methods of issuance, types of bonds, documentation filing, supervision and review innovative issuance and other aspects, which improves our bonds financing efficiency and effectively lowers financing costs. Pursuant to relevant supervisory regulations, within 24 months after the Company is granted the qualification as a high-quality issuer, the Company can apply for the storage issuance of corporate bonds in the capital markets. The Company proposes to apply to the SSE for issuance of various types of corporate bonds of not more than RMB20 billion, including but not limited to ordinary corporate bonds, renewable bonds and green corporate bonds.

1) About the High-quality Issuer

The Company has successfully joined the list of the First Batch of High-quality Corporate Bonds Issuers compiled by the CSRC. Pursuant to the Correspondence regarding Applying Corporate Bonds and Optimized Financing Supervision to Yanzhou Coal Mining Company Limited from the Shanghai Stock Exchange（《上海證券交易所關於兗州煤業股份有限公司適用公司債券優化融資監管的函》）, the Company can compile one set of application documents for different types of publicly issued bonds, such as ordinary corporate bonds, renewable bonds and green corporate bonds, and file one uniform application. The Company can specify the type of bonds, the issuance plan, the use of proceeds and other details in the respective tranches till the pre-issuance filing process. The validity period of the Issuance is within 24 months after the CSRC grants the approval.

2) Conditions for the Issuance

Pursuant to the Company Law of the PRC, the Securities Law of the PRC, the Administrative Measures for the Issuance and Trading of Corporate Bonds（《公司債券發行與交易管理辦法》）, other relevant laws, administrative laws, departmental regulations and regulatory documents and relevant regulations of the SSE regarding storage issuance of corporate bonds, the Company proposes to issue corporate bonds to qualified investors under the Administrative Measures for the Issuance and Trading of Corporate Bonds.

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LETTER FROM THE BOARD

3) Plan of the Issuance and the Authorization

The major terms of the plan of the Issuance are set out as follows:

(1) The size and method of the Issuance;

The size of the Bonds to be issued will not be more than RMB20 billion (inclusive) and the Bonds can be issued in tranches.

(2) The maturity period of the Bonds;

The maturity period of the Bonds will not be more than 15 years (inclusive). The Bonds may comprise subcategories with a single maturity period or multiple maturity periods. The Company shall determine the composition of specific maturity periods and the size of the Bonds based on the capital demands of the Company and market conditions at the time of Issuance.

(3) The par value and the issue price;

The par value of the Bonds is RMB100.0, which is also the issue price.

(4) The coupon rate and its determination mechanism;

The coupon rate shall be a fixed rate and calculated on an annual basis without accruing compound interests.

(5) The form of the Bonds;

The Bonds are real-name account corporate bonds. The Bonds subscribed by investors shall be trusted and lodged with the trust accounts set up by the relevant bond registration authorities. Upon the completion of the Issuance, the holders of the Bonds can transfer, pledge or otherwise deal with the Bonds pursuant to the relevant regulations of the supervising authorities.

(6) The method of interest payment and redemption;

The interests will be distributed annually and fully redeemed upon maturity, and the last interest payment will be distributed together with the redemption of principal.

(7) The guarantee;

The Bonds do not have any guarantee arrangement.

(8) The underwriting;

The unsubscribed portion of the Bonds shall be underwritten by the underwriter syndicate formed by the lead underwriter.

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LETTER FROM THE BOARD

(9) The target of the Issuance;

The target of the Issuance are the qualified investors pursuant to the Administrative Measures for the Issuance and Trading of Corporate Bonds and other relevant laws and regulations.

(10) The placing arrangement for Shareholders;

The Bonds will be publicly issued to the qualified investors and will not be offered, by way of preferential placing, to the Shareholders.

(11) The listing arrangement;

The listing arrangement of the Bonds shall be decided upon the completion of the Issuance taking into consideration the actual situation of the Company, the method of issuance and the market conditions.

(12) The authorization.

In order to effectively coordinate the specific matters in the Issuance, a resolution will be proposed at the AGM to grant a general and unconditional mandate to authorize the Board and the Board to authorize the chairman of the Board (or his authorized representatives) to deal with, as its/their sole discretion, all matters in connection with the Issuance in accordance with relevant laws and regulations and the opinions and suggestions of supervising authorities under the framework and principle considered and approved at the general meeting in order to maximize the interests of the Company, including but not limited to:

(A) To formulate and adjust the detailed plans and terms, including but not limited to all matters in connection with the Issuance, such as the types of the Bonds, the size of the Issuance, the method of the Issuance, the quantity of the Issuance, the maturity periods, par value, issue price, the interest rate of the Bonds or its determination methods, safeguard mechanism for repayment (including but not limited to not distributing profit to the Shareholders), Issuance arrangements (including but not limited to tranches and quantity), Issuance date, rating arrangements, guarantees, underwriting arrangements, specific subscription methods, specific placing arrangements, interest rate adjustment clauses or redemption provisions (if applicable), put provisions (if applicable), payment orders, method of repayment of principal and interests, use of proceeds and listing of the Bonds in accordance with the laws and regulations of the state, relevant regulations of securities supervision departments, the resolutions of the Company’s general meeting and the specific situation of the Company as well as the bond market;

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LETTER FROM THE BOARD

(B) To decide the engagement of intermediaries to deal with the reporting matters of the Issuance as well as the matters of listing and repayment of principal and interests of the Bonds after completion of the Issuance, including but not limited to authorizing, executing, performing, amending and completing all necessary documents, contracts, agreements and covenants (including but not limited to underwriting agreements, bond trustee management agreements, listing agreements and other legal documents, etc.) and disclosing relevant information in accordance with laws, regulations and listing rules of the places where the securities of the Company are listed (including but not limited to the preliminary and final debt financing instruments issuance memorandum, all announcements and circulars related to the Company’s domestic debt financing instrument issuance, etc.);
(C) To select the bond trustee manager(s) for the Issuance of the corporate bonds, sign the trustee management agreement(s) and formulate rules of bondholders meeting;
(D) To undertake all applications and filings as well as listing matters (if applicable) in connection with the Issuance, including but not limited to preparing, amending and submitting relevant application materials for the issuance and listing of the domestic debt financing instruments of the Company, as well as signing the relevant application documents and other legal documents according to the requirements of relevant regulatory authorities;
(E) To authorize the Board and the Board to authorize the chairman of the Board (or his authorized representatives) to make relevant adjustments to matters relating to the Issuance according to the advice of regulatory authorities and changes in policies or the changes in market conditions, or determine whether to proceed with all or any part of the Issuance in accordance with the actual conditions, save as matters that require re-approval at the general meeting pursuant to the relevant laws, regulations and the Articles of Association;
(F) Subject to approval of the above authorisation at the general meeting, the Board and the chairman of the Board with the authorization from the Board (or his authorized representatives), which is to be authorized by the Shareholders, shall deal with other matters in relation to the Issuance which are not mentioned above; and
(G) The above authorization shall be valid for 12 months from the date of passing of the relevant resolutions at the AGM. In the event that the Company has obtained the approval, permit, filing or registration of the Issuance (if applicable) from regulatory authorities during the validity period of such authorization, the Company may complete the Issuance or part of the Issuance within the validity period of such approval, permit, filing or registration (if applicable). As to the matters relating to

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LETTER FROM THE BOARD

the Issuance or part of the Issuance, the valid period of the authorization above will be extended to the date on which the Issuance or part of the Issuance is completed.

X. AGM, A SHAREHOLDERS’ CLASS MEETING AND H SHAREHOLDERS’ CLASS MEETING

The notices convening the AGM, the A Shareholders’ Class Meeting and the H Shareholders’ Meeting were published on 8 April 2019. And the supplementary notice of the AGM was published on 26 April 2019.

The following resolutions will be proposed to the Shareholders at the AGM:

As ordinary resolutions:

To consider and approve the working report of the Board for the year ended 31 December 2018, details of which are set out in the section headed “Board of Directors’ Report” in the 2018 annual report of the Company;
To consider and approve the working report of the Supervisory Committee for the year ended 31 December 2018, details of which are set out in the notice of the AGM dated 8 April 2019;
To consider and approve the audited financial statements of the Company and its subsidiaries for the year ended 31 December 2018, details of which are set out in the 2018 annual report of the Company;
To consider and approve the proposed profit distribution plan of the Company for the year ended 31 December 2018 and to authorize the Board to distribute an aggregate cash dividend of RMB2,652.5 million (tax inclusive), equivalent to RMB0.54 (tax inclusive) per Share to the Shareholders;
To consider and approve the remuneration of the Directors and supervisors for the year ending 31 December 2019, details of which are set out in the announcement of the Company dated 29 March 2019 regarding the resolutions passed at the twenty-fourth meeting of the seventh session of the Board;
To consider and approve the “Proposal in relation to the renewal of the liability insurance of the Directors, supervisors and senior officers”;
To consider and approve the “Proposal in relation to the appointment and remuneration of external auditing firm for the year 2019”;
To consider and approve the appointment of non-independent Director;

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LETTER FROM THE BOARD

As special resolutions:

To consider and approve the amendments to the Articles of Association of Yanzhou Coal Mining Company Limited;
To consider and approve the “Proposal in respect of the provision of financial guarantee(s) to the Company’s subsidiaries and the granting of authorization to Yancoal Australia Limited and its subsidiaries to provide guarantee(s) in relation to daily operations to the subsidiaries of the Company in Australia”;
To consider and approve the “Proposal to authorize the Company to carry out domestic and overseas financing businesses”;
To consider and approve the “Proposal regarding the general mandate authorizing the Board to issue additional H shares”;
To consider and approve the “Proposal regarding the general mandate authorizing the Board to repurchase H shares”; and
To consider and approve the “Proposal in relation to the Plan of Storage Issuance of Corporate Bonds and Related Authorizations”.
(1) To consider and approve the size and method of the Issuance;
(2) To consider and approve the maturity period of the Bonds;
(3) To consider and approve the par value and the issue price;
(4) To consider and approve the coupon rate and its determination mechanism;
(5) To consider and approve the form of the Bonds;
(6) To consider and approve the method of interest payment and redemption;
(7) To consider and approve the guarantee;
(8) To consider and approve the underwriting;
(9) To consider and approve the target of the Issuance;
(10) To consider and approve the placing arrangement for Shareholders;
(11) To consider and approve the listing arrangement;
(12) To consider and approve the authorization.

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LETTER FROM THE BOARD

The following resolution will be proposed to the Shareholders at the A Shareholders’ Class Meeting and the H Shareholders’ Class Meeting:

As special resolutions:

To consider and approve the proposal regarding the general mandate authorizing the Board to repurchase H Shares.

Whether or not you are able to attend the respective meetings in person, you are strongly advised to complete and sign the revised form of proxy dated 26 April 2019 in accordance with the instructions printed thereon. For holders of H Shares of the Company, the proxy form shall be lodged with the Company’s H Share Registrar, Hong Kong Registrars Limited at 17M, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong. For holders of A Shares of the Company, the proxy form shall be lodged at the Office of the Secretary to the Board at 298 South Fushan Road, Zoucheng, Shandong Province 273500, the PRC as soon as possible but in any event not later than 24 hours before the time appointed for the holding of the relevant meeting(s) or any adjourned meeting(s) (as the case may be). Completion and return of the proxy form will not preclude you from attending and voting in person at the meeting(s) or any adjourned meeting(s) should you so wish.

XI. CLOSURE OF H SHARE REGISTER OF MEMBERS OF THE COMPANY

1. Attending the AGM and H Shareholders’ Class Meeting

The H Share register of members of the Company will be closed from Wednesday, 24 April 2019 to Friday, 24 May 2019 (both days inclusive), during which period no transfer of the Company’s H Shares will be registered for the purpose of ascertaining the eligibility of Shareholders to attend the AGM and the H Shareholders’ Class Meeting. In order to attend the AGM and the H Shareholders’ Class Meeting, all share transfers, accompanied by the relevant share certificates, must be lodged for registration with the Company’s H Share Registrar, Hong Kong Registrars Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong, no later than 4:30 p.m. on Tuesday, 23 April 2019 for registration. H Shareholders whose names appear on the H Share register of members of the Company maintained by Hong Kong Registrars Limited at the close of business on Tuesday, 23 April 2019 will be eligible to attend the AGM and the H Shareholders’ Class Meeting.

2. Receipt of final dividend

The Company will put forward an ordinary resolution at the AGM to approve the distribution of an aggregate cash dividend of RMB2,652.5 million (tax inclusive), equivalent to RMB0.54 (tax inclusive) per Share to the Shareholders.

To determine the identity of the Shareholders entitled to receive the final dividend, the Company’s H Share register of members will be closed from Wednesday, 5 June 2019 to Monday, 10 June 2019 (both days inclusive), during which period no transfer of H Shares will be registered. In order to be entitled to the final dividend, H

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LETTER FROM THE BOARD

Shareholders who have not registered the transfer documents are required to deposit the transfer documents together with the relevant Share certificates with the H Share Registrar of the Company, Hong Kong Registrars Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong no later than 4:30 p.m. on Tuesday, 4 June 2019.

Details in relation to profit distribution to investors who invest in the shares of the Company listed on the Hong Kong Stock Exchange through the SSE or vice versa under the Shanghai – Hong Kong Stock Connect program will be disclosed in the AGM poll results announcement of the Company.

XII. RECOMMENDATION OF THE BOARD

The Directors believe that the resolutions set out in the notices and supplementary notice (if any) of the AGM, the H Shareholders’ Class Meeting and the A Shareholders’ Class Meeting are in the best interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend that all Shareholders should vote in favour of the resolutions to be proposed at the AGM, the H Shareholders’ Class Meeting and the A Shareholders’ Class Meeting.

XIII. ADDITIONAL INFORMATION

Your attention is drawn to the additional information set out in the other sections in and the Appendices to this circular.

XIV. RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

By order of the board of directors Yanzhou Coal Mining Company Limited Li Xiyong Chairman

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EXPLANATORY STATEMENT

APPENDIX I

This explanatory statement contains all the information required to be given to the Shareholders pursuant to Rule 10.06(1)(b) of the Listing Rules in connection with the proposed Repurchase Mandate, which is set out as follows:

1. Hong Kong Listing Rules

The Hong Kong Listing Rules permit companies with a primary listing on the Hong Kong Stock Exchange to repurchase their securities subject to certain restrictions. Repurchases must be funded out of funds legally available for the purpose and in accordance with the company’s constitutional documents and the applicable laws of the jurisdiction in which the company is incorporated or otherwise established. Any repurchase must be made out of funds which are legally available for the purpose and in accordance with the laws of the PRC and the memorandum and articles of association of the company. Any premium payable on a repurchase over the par value of the shares may be effected out of funds of the company which would otherwise be available for dividend or distribution or out of the proceeds of a new issue of shares made for the purchase of repurchase.

2. Reasons for Repurchase of H Shares

The Board believes that the flexibility afforded by the Repurchase Mandate to repurchase H Shares would be beneficial to and in the best interests of the Company and its Shareholders. Such repurchase may, depending on the market conditions and funding arrangement at the time, lead to an enhancement of the net asset value and/or its earnings per Share and will only be made when the Board believes that such a repurchase will benefit the Company and its Shareholders.

3. Registered Capital

As at the Latest Practicable Date, the registered capital of the Company was RMB4,912,016,000 comprising 1,952,016,000 H Shares of RMB1.00 each and 2,960,000,000 A Shares of RMB1.00 each.

4. Exercise of the Repurchase Mandate

Subject to the passing of the special resolution approving the granting of the Repurchase Mandate to the Board at the AGM, the A Shareholders’ Class Meeting and the H Shareholders’ Class Meeting respectively, the Board will be granted the Repurchase Mandate until the end of the Relevant Period (as defined in the special resolutions in the notice and the supplementary notice of the AGM, the notice of the A Shareholders’ Class Meeting and the notice of the H Shareholders’ Class Meeting, respectively). The exercise of the Repurchase Mandate is subject to: (1) the approvals of the relevant PRC regulatory authorities as required by the laws, rules and regulations of the PRC being obtained; and (2) the Company not being required by any of its creditors to repay or to provide guarantee in respect of any amount due to any of them (or if the Company is so required by any of its creditors, the Company having, in its absolute discretion, repaid or provided guarantee in respect of such amount) pursuant to the provisions of the Articles of Association applicable to reduction of share capital.

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EXPLANATORY STATEMENT

APPENDIX I

The exercise in full of the Repurchase Mandate (on the basis of 1,952,016,000 H Shares in issue as at the Latest Practicable Date and no H Shares will be allotted and issued or repurchased by the Company on or prior to the date of the AGM, the A Shareholders’ Class Meeting and the H Shareholders’ Class Meeting) would result in a maximum of 195,201,600 H Shares being repurchased by the Company during the Relevant Period, being the maximum of 10% of the total H Shares in issue as at the date of passing the relevant resolutions.

5. Funding of Repurchases

In repurchasing its H Shares, the Company intends to apply funds from the Company’s internal resources (which may include surplus funds and undistributed profits) legally available for such purpose in accordance with the Articles of Association and the applicable laws, rules and regulations of the PRC.

The Company is empowered by its Articles of Association to purchase its H Shares. Any repurchases by the Company may only be made out of either the funds of the Company that would otherwise be available for dividend or distribution or out of the proceeds of a new issue of shares made for such purpose, or from sums standing to the credit of the share premium account of the Company. The Company may not purchase securities on the Hong Kong Stock Exchange for a consideration other than cash or for settlement otherwise than in accordance with the trading rules of the Hong Kong Stock Exchange from time to time.

Based on the financial position disclosed in the recently published audited accounts for the year ended 31 December 2018, the Board considers that there will not be any material adverse impact on the working capital or gearing position of the Company in the event that the Repurchase Mandate is to be exercised in full at any time during the proposed repurchase period. The number of H Shares to be repurchased on any occasion and the price and other terms upon which the same are repurchased will be decided by the Board at the relevant time having regard to the circumstances then prevailing and in the best interests of the Company.

6. Status of Repurchased

H Shares The Hong Kong Listing Rules provide that the listing of all the H Shares repurchased by the Company shall automatically be cancelled and the relevant share certificates shall be cancelled and destroyed. Under the PRC laws, the H Shares repurchased by the Company will be cancelled within 10 days and the Company’s registered capital will be reduced by an amount equivalent to the aggregate nominal value of the H Shares so cancelled.

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EXPLANATORY STATEMENT

APPENDIX I

7. H Shares Prices

The highest and lowest prices at which the H Shares have been traded on the Hong Kong Stock Exchange during each of the twelve months preceding the Latest Practicable Date were as follows:

	H Share Prices	H Share Prices
	Highest	Lowest
	HK$ per share	_HK$ per _	share
2018
April	10.75		8.65
May	11.69		9.12
June	12.42		9.46
July	10.66		8.52
August	9.99		8.48
September	9.40		8.10
October	9.33		7.20
November	7.83		6.87
December	7.39		6.12
2019
January	7.23		5.95
February	8.29		6.98
March	8.48		7.27
April (up to the Latest Practicable Date)	9.20		8.19

8. Substantial Shareholders

As at the Latest Practicable Date, the interests of substantial shareholder of the Company which was interested in more than 10% of the issued Shares was as follows:

Name Class of shares Capacity Nature of interests Yankuang Group A Shares (state legal person share) Beneficial owner Long position Short position Yankuang Group (Note) H Shares Interest of controlled corporation Long position Total	Number of ordinary shares held in the Company 2,267,169,423 391,507,272 277,989,000 2,545,158,423	Percentage of total issued share capital of the Company 46.16% 7.97% 5.66%
		51.81%

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EXPLANATORY STATEMENT

APPENDIX I

Note:

(a) Yankuang Group’s subsidiary incorporated in Hong Kong holds such H Shares in the capacity of beneficial owner.
(b) The figures of the percentage ratios are rounded to the nearest two decimal places.

9. General Information

(a) None of the Directors, to the best of their knowledge having made all reasonable enquiries, nor any of their associates, have any present intention to sell any H Shares to the Company or any of its subsidiaries under the Repurchase Mandate if such is approved by the Shareholders.
(b) The Directors have undertaken to the Hong Kong Stock Exchange that, so far as the same may be applicable, they will exercise the power of the Company to repurchase the H Shares pursuant to the Repurchase Mandate in accordance with the Hong Kong Listing Rules and the applicable laws of the PRC.
(c) No core connected person (as defined in the Hong Kong Listing Rules) of the Company has notified the Company that he has a present intention to sell H Shares to the Company or its subsidiaries, or has undertaken not to do so, if the Repurchase Mandate is granted and is exercised.

10. Takeovers Code

If on the exercise of the power to repurchase Shares pursuant to the Repurchase Mandate, a Shareholder’s proportionate interest in the voting rights of the Company increases, such increase will be treated as an acquisition for the purposes of Rule 32 of the Takeovers Code. As a result, a Shareholder or group of Shareholders acting in concert could obtain or consolidate control of the Company and become obliged to make a mandatory offer in accordance with Rules 26 and 32 of the Takeovers Code.

Assuming that the substantial Shareholders do not dispose of their Shares, if the Repurchase Mandate was exercised in full, the percentage shareholdings of the substantial Shareholders before and after such repurchase would be as follows:

Substantial Shareholder	Before repurchase	After repurchase
Yankuang Group	51.81%	53.96%

On the basis of the shareholdings held by the substantial Shareholder named above, an exercise of the Repurchase Mandate in full will not have any implications for the substantial Shareholders under the Takeovers Code.

The Company was informed by Yankuang Group that Yankuang Group had issued exchangeable corporate bonds that are exchangeable into A Shares of the Company, which may result in a decline of Yankuang Groups’ percentage shareholdings in the Company. For detailed information about the exchangeable corporate bonds issued by Yankuang Group,

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EXPLANATORY STATEMENT

APPENDIX I

please refer to the relevant announcements of the Company dated 3 November 2016, 6 April 2017, 11 April 2017, 8 September 2017, 21 April 2017, 26 September 2017, 9 April 2018 and 28 December 2018.

Assuming that there is no issue of Shares between the Latest Practicable Date and the date of a repurchase, an exercise of the Repurchase Mandate whether in whole or in part will not result in less than the relevant prescribed minimum percentage of the Shares of the Company being held by the public as required by the Hong Kong Stock Exchange.

The Directors have no intention to exercise the Repurchase Mandate to an extent which may result in the requirements under Rule 8.08 of the Listing Rules not being complied with.

Save as disclosed above, the Directors are not aware of any consequences that may arise under the Takeovers Code and/or any relevant law of which the Directors are aware, if any, as a result of any share repurchases made.

11. Share Repurchases Made by the Company

The Company had not repurchased any of its H shares (whether on the Hong Kong Stock Exchange or otherwise), during the six months period preceding the Latest Practicable Date.

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BIOGRAPHICAL DETAILS OF THE CANDIDATE FOR THE ELECTION OF DIRECTOR

APPENDIX II

The biographical details of the candidate for appointment as the Director of the seventh session of the Board are set out as follows:

Mr. Liu Jian (“Mr. Liu”) , born in February 1969, a Research Fellow in Applied Engineering Technology and a Master of Engineering, is the Vice General Manager of the Company. Mr. Liu joined the predecessor of the Company in 1992 and was appointed as the vice manager of Dongtan Coal Mine（東灘煤礦）of the Company in 2009. He was appointed as the manager of Jining No. 3 Coal Mine （濟寧三號煤礦）and the manager of Dongtan Coal Mine of the Company in 2014 and January 2016, respectively. In December 2016, he was appointed as the Vice General Manager of the Company. Mr. Liu also serves as the director of several subsidiaries of the Company, including Yanmei Heze Neng Hua Company Limited（兗煤菏澤能化有限公司）, Yanzhou Coal Shanxi Neng Hua Company Limited（兗州煤業山西能化有限公司）, Yancoal International (Holding) Company Limited（兗煤國際（控股）有限公司）and Yankuang Donghua Heavy Industry Company Limited*（兗礦東華重工有限公司）. Mr. Liu graduated from Shandong University of Science and Technology.

Upon approval of the appointment of Mr. Liu by the Shareholders, Mr. Liu will enter into a service contract with the Company for a term commencing from the conclusion of the general meeting which approves his appointment as a Director till the conclusion of the general meeting which elects and appoints the Directors of the eighth session of the Board, and may be re-elected at the general meeting of the Company.

As at the Latest Practicable Date, saved as disclosed above, Mr. Liu confirmed that: (i) he had not held any directorships in any public companies the securities of which were listed on any securities market in Hong Kong and/or overseas in the past three years, nor held any other major appointment and professional qualification; (ii) he did not hold any other position with the Company or its subsidiaries; (iii) he did not have any interests in the shares or securities of the Company within the meaning of Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong); and (iv) he did not have any relationship with other current Directors, senior management and substantial or controlling Shareholders of the Company.

The remuneration for Mr. Liu will be determined at the general meeting pursuant to the Articles of Association and with reference to recommendations of the remuneration committee of the Board in accordance with its terms of reference, taking into account of, among other matters, his duties, responsibilities, experience and current market conditions.

Save as disclosed above, the Board is not aware of any other matters regarding the proposed appointment of Mr. Liu as a Director which are required to be disclosed pursuant to Rule13.51(2) of the Listing Rules, or any other matter that is required to be brought to the attention of the Shareholders.

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AI assistant

CStone Pharmaceuticals — Proxy Solicitation & Information Statement 2019

50715_rns_2019-05-08_721b2886-1b21-45db-ab30-04d128aa7f04.pdf

兗州煤業股份有限公司

YANZHOU COAL MINING COMPANY LIMITED

(8) PROPOSED STORAGE ISSUANCE OF CORPORATE BONDS AND RELEVANT AUTHORIZATION

DEFINITIONS

DEFINITIONS

DEFINITIONS

兗州煤業股份有限公司 YANZHOU COAL MINING COMPANY LIMITED

I. INTRODUCTION

II. PROPOSED APPOINTMENT OF NON-INDEPENDENT DIRECTOR

III. PROPOSED RENEWAL OF LIABILITY INSURANCE FOR DIRECTORS, SUPERVISORS AND SENIOR OFFICERS

IV. PROPOSAL FOR APPOINTMENT OF EXTERNAL AUDITING FIRM FOR THE YEAR 2019

V. PROPOSAL TO AUTHORIZE THE COMPANY TO CARRY OUT DOMESTIC AND OVERSEAS FINANCING ACTIVITIES

LETTER FROM THE BOARD

VII. PROPOSAL FOR THE GENERAL MANDATES TO ISSUE H SHARES AND REPURCHASE H SHARES

LETTER FROM THE BOARD

Explanatory statement

VIII. DETAILS OF PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

The original Article 12 of the Articles of Association

LETTER FROM THE BOARD

The above paragraphs are proposed to be amended as follows:

IX. PROPOSED STORAGE ISSUANCE OF CORPORATE BONDS AND RELEVANT AUTHORIZATION

1) About the High-quality Issuer

2) Conditions for the Issuance

3) Plan of the Issuance and the Authorization

LETTER FROM THE BOARD

X. AGM, A SHAREHOLDERS’ CLASS MEETING AND H SHAREHOLDERS’ CLASS MEETING

The following resolutions will be proposed to the Shareholders at the AGM:

As ordinary resolutions:

As special resolutions:

As special resolutions:

XI. CLOSURE OF H SHARE REGISTER OF MEMBERS OF THE COMPANY

1. Attending the AGM and H Shareholders’ Class Meeting

2. Receipt of final dividend

XII. RECOMMENDATION OF THE BOARD

XIII. ADDITIONAL INFORMATION

XIV. RESPONSIBILITY STATEMENT

1. Hong Kong Listing Rules

2. Reasons for Repurchase of H Shares

3. Registered Capital

4. Exercise of the Repurchase Mandate

APPENDIX I

5. Funding of Repurchases

6. Status of Repurchased

7. H Shares Prices

8. Substantial Shareholders

9. General Information

10. Takeovers Code

11. Share Repurchases Made by the Company

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CStone Pharmaceuticals Proxy Solicitation & Information Statement 2019