THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Dalian Port (PDA) Company Limited*, you should at once hand this circular, together with the accompanying form of proxy and reply slip, to the purchaser(s) or transferee(s) or to the bank, stockbroker 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.

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Dalian Port (PDA) Company Limited[] *大連港股份有限公司**

(a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2880)

NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS AND NOTICE OF EGM

Independent Financial Adviser to

the Independent Board Committee and the Independent Shareholders

A letter from the Board is set out on pages 4 to 12 of this circular.

A letter from the Independent Board Committee to the Independent Shareholders is set out on pages 13 to 14 of this circular and a letter from TC Capital International Limited, the Independent Financial Adviser, containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 15 to 24 of this circular.

A notice convening the extraordinary general meeting (the “ EGM ”) of the Company to be held at Room 109, PDA Group Building, No. 1 Gangwan Street, Zhongshan District, Dalian City, Liaoning Province, PRC at 9:00 a.m. on Friday, 28 February 2020 was published on the website of The Stock Exchange of Hong Kong Limited (the “ Hong Kong Stock Exchange ”) (http://www.hkexnews.hk) on 13 January 2020. A form of proxy and a reply slip for use in connection with the EGM were enclosed therein and published on the website of the Hong Kong Stock Exchange (http://www.hkexnews.hk). Whether or not you are able to attend the EGM, please complete, sign and return the reply slip and the form of proxy in accordance with the instructions printed thereon as soon as practicable and in any event not later than 20 days and 24 hours, respectively, before the time designated for holding the EGM or any adjournment thereof. Completion and return of the form of proxy will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish.

The Company is registered as Non-Hong Kong company under Part XI of the previous Hong Kong Companies Ordinance (equivalent to Part 16 of the Hong Kong Companies Ordinance with effect from 3 March 2014) under the English name “Dalian Port (PDA) Company Limited”.
For identification purpose only

13 January 2020

CONTENTS

	Page
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
LETTER FROM THE BOARD. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
LETTER FROM THE INDEPENDENT BOARD COMMITTEE. . . . . . . . . . . .	13
LETTER FROM THE INDEPENDENT FINANCIAL ADVISER . . . . . . . . . . .	15
APPENDIX I – GENERAL INFORMATION. . . . . . . . . . . . . . . . . . . . .	I-1
APPENDIX II – CERTAIN CONTINUING CONNECTED
TRANSACTIONS REQUIRING INDEPENDENT
SHAREHOLDERS’ APPROVAL UNDER
THE SHANGHAI LISTING RULES. . . . . . . . . . . . .	II-1
NOTICE OF EGM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	EGM-1

– i –

DEFINITIONS

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

“2018 Announcement and Circular”
the Company’s announcement dated 9 November 2018 and the circular dated 13 November 2018;
“acting in concert”

has the meaning ascribed to it under the Codes on Takeovers and Mergers and Share Buy-backs;

“Announcement”

the Company’s announcement dated 20 December 2019;

“associate”
has the meaning ascribed to it under the Listing Rules;
“Board”
the board of Directors;
“Broadford”

Broadford Global Limited, a company incorporated in Hong Kong on 27 November 2017 with limited liability and is directly wholly owned by China Merchants Holdings (Hong Kong) Company Limited and ultimately wholly-owned by CMG;

“China Merchants Liaoning”

China Merchants (Liaoning) Port Development Company Limited* (招商局(遼寧)港口發展有限公司), a limited liability company established in the PRC on 16 May 2018 and is indirectly wholly-owned by Broadford and ultimately wholly-owned by CMG;

“close associates”
has the meaning ascribed to it under the Listing Rules;
“CMG”
China Merchants Group Limited (招商局集團有限公司), a state wholly-owned enterprise established under the laws of the PRC on 14 October 1986 under the direct control of the SASAC;
“CMG Finance”
China Merchants Group Finance Co., Ltd.* (招商局集團財務有限公司) formerly known as 中外運長航財務有限公司 (Sinotrans & CSC Finance Co., Ltd.), a company which is beneficially wholly-owned by CMG and incorporated in the PRC on 17 May 2011;
“CMG Group”

CMG and its subsidiaries;

– 1 –

DEFINITIONS

“Company” Dalian Port (PDA) Company Limited* (大連港股份有限公司), a joint stock limited company incorporated in the PRC;
“connected person” has the meaning ascribed to it under the Listing Rules; “Dalian Port Finance” Dalian Port Group Finance Company Limited* (大連港集團財務有限公司), a non-bank finance company jointly established by PDA and the Company under the PRC laws on 8 November 2011;
“Deposit Services” depository services to be provided by CMG Finance to the Group pursuant to the New Financial Services Agreement;
“Director(s)” the director(s) of the Company;
“EGM” the extraordinary general meeting of the Company;
“Group” the Company and its subsidiaries;
“Hong Kong” the Hong Kong Special Administrative Region of the PRC;
“Hong Kong Stock Exchange” The Stock Exchange of Hong Kong Limited;
“Independent Board Committee” the independent committee of the Board, comprising the independent non-executive Directors, namely Mr. WANG Zhifeng, Mr. SUN Xiyun, and Mr. LAW Man Tat;
“Independent Financial Adviser” or “TC Capital”
TC Capital International Limited, acting as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the provision of Deposit Services under the New Financial Services Agreement;
“Independent Shareholders” Shareholders other than CMG and its associates;
“Latest Practicable Date”
6 January 2020, being the latest practicable date prior to the printing of this circular for ascertaining certain information herein;
“Listing Rules”

the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited;

– 2 –

DEFINITIONS

“Loan Services” credit, loan and guarantee services to be provided by CMG Finance to the Group pursuant to the New Financial Services Agreement;
“New Financial Services the framework agreement entered into by the Company Agreement” and CMG Finance on 20 December 2019 in regard to provision of Deposit Services, Loan Services and Settlement Services and other financial services by CMG Finance to the Group;
“normal commercial terms or has the meaning ascribed to it under the Listing Rules; better”
“PDA” Dalian Port Group Corporation Limited* (大連港集團有限公司), the controlling shareholder of the Company and a limited liability company established in the PRC on 1 January 1951 and directly wholly-owned by Liaoning Port Group;
“PRC” the People’s Republic of China which, for the purpose of this circular, excludes Hong Kong Special Administrative Region of the PRC, Macao Special Administrative Region of the PRC and Taiwan;
“RMB” Renminbi, the lawful currency of the PRC;
“SASAC” the State-owned Assets Supervision and Administration Commission of the State Council of the PRC;
“Settlement Services” settlement and clearance services to be provided by CMG Finance to the Group pursuant to the New Financial Services Agreement;
“SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time;
“Shanghai Listing Rules” the Stock Listing Rules of the Shanghai Stock Exchange (上海證券交易所股票上市規則);
“Shanghai Stock Exchange” the Shanghai Stock Exchange;
“Shareholders” the shareholders of the Company;

“%”

per cent.

– 3 –

LETTER FROM THE BOARD

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Dalian Port (PDA) Company Limited[] *大連港股份有限公司**

(a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2880)

Directors: Registered Office: Executive Director: Xingang Commercial Building WEI Minghui Dayao Bay Dalian Free Trade Zone Non-executive Directors : PRC CAO Dong LI Jianhui Place of Business in the PRC: YUAN Yi Xingang Commercial Building Jingang Road Independent Non-executive Directors : Dalian International Logistic Park Zone WANG Zhifeng Liaoning Province SUN Xiyun PRC LAW Man Tat

13 January 2020

To the Shareholders

Dear Sir or Madam,

NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS AND NOTICE OF EGM

A. INTRODUCTION

Reference is made to the Announcement in relation to, amongst other things, the new discloseable and continuing connected transactions.

The purpose of this circular is to provide the Shareholders with (i) further information in respect of the resolution regarding the terms of the New Financial Services Agreement, (ii) recommendations from the Independent Board Committee, (iii) a letter of advice from the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders, (iv) notice of the EGM, and (v) other information as required under the Listing Rules to enable the Shareholders to make their informed decisions as to how to vote at the EGM.

– 4 –

LETTER FROM THE BOARD

B. NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS

Reference is made to the 2018 Announcement and Circular in relation to the renewal of certain continuing connected transactions and new continuing connected transactions between the Company and/or its subsidiaries and PDA and/or its relevant associates.

Reference is also made to (i) the announcement jointly issued by Broadford and the Company dated 4 June 2019, in relation to the Equity Transfer Agreement and the possible H Share Offer; (ii) the composite offer and response document in connection with the H Share Offer dated 5 October 2019 (the “ Composite Document ”); and (iii) the announcement jointly issued by Broadford and the Company dated 28 October 2019 in relation to the results of the H Share Offer.

On 9 November 2018, the Company entered into the financial services agreement with PDA for a term of three years commencing on 1 January 2019 and ending on 31 December 2021, pursuant to which the Company shall continue to receive the deposit services, loan services, factoring services, settlement services and other financial services and finance leasing services from PDA and its associates or subsidiary(ies) (as the case may be) (including Dalian Port Finance, which is a subsidiary of PDA) (the “ Financial Services Agreement ”). As at the Latest Practicable Date, PDA remains a controlling shareholder of the Company and thus a connected person of the Company. Details of such transactions are set out in the 2018 Announcement and Circular.

Following the Completion (as defined in the Composite Document) on 30 September 2019, China Merchants Liaoning became the registered owner of an aggregate of 51% equity interest in Liaoning Port Group (a controlling shareholder of the Company). As at the Latest Practicable Date, Broadford and parties acting in concert with it were indirectly interested in approximately 75% of the total issued share capital of the Company. The Company has therefore become a fellow subsidiary of CMG Finance, which is beneficially wholly-owned by CMG.

There is a business consolidation in progress between CMG Finance and Dalian Port Finance, after which CMG Finance will gradually replace Dalian Port Finance as the provider and/or the counterparty of the financial services. To ensure a smooth business transition, on 20 December 2019, the Company entered into the New Financial Services Agreement with CMG Finance in relation to the provision of Deposit services, Loan services and Settlement Services and other financial services (the “ CMG Finance Transactions ”). The CMG Finance Transactions will gradually replace the corresponding transactions under the Financial Services Agreement, and the replacement is not expected to have material business or financial impact on our Group as a whole.

– 5 –

LETTER FROM THE BOARD

In determining the estimated annual caps for 2020 and 2021 of the transactions under the New Financial Services Agreement, the Company considered transactions that constituted connected transactions under Chapter 14A of the Listing Rules and/or transactions that constituted connected transactions under the Shanghai Listing Rules, as the relevant caps will be presented to the Company’s independent Shareholders for approval pursuant to the Listing Rules and/or the Shanghai Listing Rules. As regards the estimated annual caps for 2020 and 2021 of the above continuing connected transactions, the difference between (a) transactions that constituted connected transactions both under Chapter 14A of the Listing Rules and the Shanghai Listing Rules, and (b) transactions that constituted connected transactions only under Chapter 14A of the Listing Rules, is primarily due to the different regulatory scope under the Shanghai Listing Rules, under which legal persons or other companies (being either (a) entities in which the Group has not more than 50% interests, or (b) entities in which CMG Group (other than the Group) has less than 30% interests, and in either case the Company or CMG Group (other than the Group) does not have control over such entities) whose director, supervisor and/or member of senior management is a natural person associated (as defined under the Shanghai Listing Rules) with the Company within the past 12 months will constitute connected persons. Such legal persons or other companies will not constitute connected persons under the Listing Rules.

1. Discloseable and continuing connected transactions subject to independent shareholders’ approval requirement

1.1 Financial Services – Deposit Services

Pursuant to the New Financial Services Agreement, CMG Finance shall provide Deposit Services to the Group on normal commercial terms or better to the Group for a term commencing on the date of the EGM and ending on 31 December 2021.

(a) Pricing

The interest rate payable by CMG Finance to the Group for any deposits should not be lower than the interest rate prescribed by People’s Bank of China (中國人民銀行, “ PBOC ”) for comparable deposits. Nor should it be lower than the interest rate paid by other major commercial banks in the PRC for comparable deposits. In addition, the daily closing balance of the Group’s deposit with CMG Finance including the Group’s deposit with PDA and its associates or subsidiary(ies) (as the case may be) under the Financial Services Agreement should not exceed RMB4.0 billion.

– 6 –

LETTER FROM THE BOARD

(b) Historical figures for each of the two years ended 31 December 2017 and 2018, the nine months ended 30 September 2019, estimated amount for the year ending 31 December 2019 and estimated annual caps for each of the two years ending 31 December 2020 and 2021

				Estimated	Estimated	Estimated
			For	amount for	annual cap	annual cap
	For the	For the	9 months	the year	for the year	for the year
	year ended	year ended	ended	ending	ending	ending
	31 December	31 December	30 September	31 December	31 December	31 December
	2017	2018	2019	2019	2020	2021
	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)
Financial Services –	3,164,850(1)	3,665,619(1)	3,576,264(1)	4,000,000(3)	4,000,000(5)	4,000,000(5)
Deposit Services
(maximum daily
closing balance)	(3,164,850)(2)	(3,665,619)(2)	(3,576,264)(2)	(4,000,000)(4)	(4,000,000)(6)	(4,000,000)(6)

Notes:

(1) The figures relate to transactions in respect of the deposit services between the Company and PDA that constituted connected transactions under Chapter 14A of the Listing Rules and the Shanghai Listing Rules. The historical annual caps in respect of the deposit services between the Company and PDA for the years ended 31 December 2017 and 2018 are RMB4.0 billion, respectively.
(2) The figures set out in “()” relate to transactions in respect of the deposit services between the Company and PDA that constituted connected transactions under Chapter 14A of the Listing Rules.
(3) The estimated amount for 2019 relates to the annual cap in respect of the deposit services between the Company and PDA which is the total of that approved by the Shareholders under the Listing Rules and the Shanghai Listing Rules.
(4) The estimated amount for 2019 relates to the annual cap in respect of the deposit services between the Company and PDA approved by the Shareholders under the Listing Rules.
(5) In determining the estimated annual caps for each of the two years ending 31 December 2020 and 2021 in respect of the Deposit Services between the Company and CMG Finance, the Company considered transactions that will constitute connected transactions both under the Listing Rules and the Shanghai Listing Rules.
(6) The figures set out in “()” relate to the relevant Listing Rule annual caps for each of the two years ending 31 December 2020 and 2021 in respect of the Deposit Services between the Company and CMG Finance.

The New Financial Services Agreement is a new arrangement between the Company and CMG Finance which was signed on 20 December 2019. There are no historical transactions recorded between the Company and CMG Finance for the years ended 31 December 2017, 2018 and 2019, respectively.

In determining the estimated annual caps for 2020 and 2021 in respect of the Deposit Services between the Company and CMG Finance, the Directors have considered a number of factors, including: (i) the historical figures of the maximum daily closing balance of deposit in respect of the deposit services between the Company and PDA for

– 7 –

LETTER FROM THE BOARD

the years ended 31 December 2017 and 2018 and the nine months ended 30 September 2019 as shown in the table above, and (ii) the level of the historical figures in 2019 and the Directors expects the level of the estimated annual caps to remain stable for 2020 and 2021.

As mentioned above, there is a business consolidation in progress between CMG Finance and Dalian Port Finance. The proposed annual cap of the Deposit Services is set at the same level of the proposed annual cap of the deposit services under the Financial Services Agreement entered into between the Company and PDA on 9 November 2018 in order to gradually replace the corresponding transactions under the Financial Services Agreement.

(c) Internal control

In order to ensure minimal concentration risk exposure in relation to maintaining a high level of cash deposits with one or two finance companies, in particular, CMG Finance, the Company has appropriate internal controls in place, including:

the Company will, prior to the placement of deposit with CMG Finance, (i) check the benchmark interest rates for deposits published by the PBOC; and (ii) check the interest rates offered by at least two major commercial banks which have established business relationship with the Group; and
according to the articles of CMG Finance, CMG has provided a written undertaking that in the event CMG Finance has any issues with its cash flow, CMG will increase its capital in CMG Finance, to ensure the capital of members of the Group is not affected.

C. REASON FOR AND BENEFITS OF ENTERING INTO THE NEW FINANCIAL SERVICES AGREEMENT

The Directors believe that the entering into of the New Financial Services Agreement ensures the operational and business development needs of the Group are effectively met at the outset of the proposed business consolidation between CMG Finance and Dalian Port Finance, with terms and conditions of the transactions being not less favourable to the Group than that those available from independent third parties. The terms and conditions of the New Financial Services Agreement are on normal commercial terms or better, fair and reasonable and in the interests of the Company and Shareholders as a whole.

– 8 –

LETTER FROM THE BOARD

Effect on the earnings, assets and liabilities of the Company in relation to the entering into of the New Financial Services Agreement

The entering into of the New Financial Services Agreement will enable the Group to continue to centralize its control and management over the financial resources of the Group and attain diversified sources of funding. Therefore, the Directors are of the view that entering into the New Financial Services Agreement overall will have a positive impact on the Group’s earnings as a whole.

Furthermore, the entering into of the New Financial Services Agreement effectively supplements the financing needs of the Group. By broadening the Group’s financing channels through CMG Finance, there would be an increase in the source of funds which would elevate the level and efficiency of overall operations of enterprise capital, and which would strengthen the bargaining power of the Group in respect of external financing.

Meanwhile, the New Financial Services Agreement enables the Company to obtain interest rates for deposits no lower than those in the market and to enjoy on-shore settlement services at zero rate, thereby increasing the interest income on deposits and saving settlement costs, which would increase the operating profits of the Company.

Given the nature of the continuing connected transactions (including the transactions contemplated under the New Financial Services Agreement), the Company does not expect there will be any significant adverse effect on the earnings, assets and liabilities of the Group.

D. LISTING RULES IMPLICATIONS

1. New Discloseable and Continuing Connected Transactions

As at the Latest Practicable Date, the Company is a fellow subsidiary of CMG Finance. As such, CMG Finance is a connected person of the Company and the transactions contemplated under the New Financial Services Agreement will constitute connected transactions of the Company under Chapter 14A of the Listing Rules.

As one or more of the applicable percentage ratios for the provision of Deposit Services under the New Financial Services Agreement is, on an annual basis, more than 5% and the proposed annual caps for such transactions are more than HK$10,000,000, such transactions are subject to the reporting, annual review, announcement and the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. As one or more of the applicable percentage ratios for such transactions is, on an annual basis, more than 5% but less than 25%, such transactions also constitute a discloseable transaction of the Company, and are also subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.

– 9 –

LETTER FROM THE BOARD

The Directors (excluding the independent non-executive Directors whose opinion is stated in the “Letter from the Independent Board Committee” of this circular) consider that the provision of Deposit Services under the New Financial Services Agreement is in the Group’s ordinary and usual course of business, on normal commercial terms or better to the Group, is fair and reasonable and is in the interests of the Company and the Shareholders as a whole. The Directors, excluding the independent non-executive Directors, also consider that the proposed annual caps for each of the two years ending 31 December 2020 and 2021 for the relevant transactions are fair and reasonable.

2. General

Each of Mr. XU Song (who resigned on 16 December 2019), Mr. YIM Kong (who resigned on 17 December 2019), Mr. CAO Dong, Dr. LI Jianhui, Mr. YUAN Yi and Mr. WEI Minghui, being a Director also holding a management position or directorship with CMG or its associates (other than the Group), has abstained from voting on the board resolution approving the New Financial Services Agreement on 6 December 2019 and the transactions contemplated thereunder. Save as disclosed above, none of the Directors attending the board meeting has a material interest in or is required to abstain from voting on the New Financial Services Agreement and the transactions contemplated thereunder.

The Independent Board Committee has been formed to advise the Independent Shareholders in respect of the provision of Deposit Services under the New Financial Services Agreement as well as the proposed annual caps for the aforementioned transactions. An independent financial adviser has also been appointed to advise the Independent Board Committee to the Independent Shareholders on the same. CMG and its associates will abstain from voting on the ordinary resolution approving the New Financial Services Agreement and the transactions contemplated thereunder, as well as the proposed annual caps for the aforementioned transactions at the general meeting to be held by the Company.

Reference is made to the Announcement. Although the transactions contemplated under the provision of Loan Services and Settlement Services and other financial services under the New Financial Services Agreement are exempt from independent shareholders’ approval requirement under Chapter 14A of the Listing Rules, the Company will seek independent shareholders’ approval for the aforementioned transactions as well as the proposed annual caps for each of the aforementioned transactions pursuant to the requirements under the Shanghai Listing Rules. Details of the resolution to be passed with respect to the transactions contemplated thereunder are set out in Appendix II of this circular.

E. GENERAL INFORMATION

The principal activities of the Group are: oil/liquefied chemical terminal and the related logistics services (Oil Segment); container terminal and related logistics services (Container Segment); automobile terminal and related logistics services (Automobile Terminal Segment); bulk and general cargo terminal and related logistics services (Bulk and General Cargo Segment); bulk grain terminal and related logistics services (Bulk Grain Segment); passenger and roll-on, roll-off terminal and related logistics services (Passenger and Ro-Ro Segment) and value-added and ancillary port operations (Value-added Services Segment).

– 10 –

LETTER FROM THE BOARD

CMG Finance is beneficially wholly-owned by CMG and incorporated in the PRC. Its principal business activities include (i) provision of financial advice, credit authentication and relevant consulting and agency services for members of the CMG Group (the “ CMG Group Members ”); (ii) assistance in collection and payment of transaction money for CMG Group Members; (iii) provision of guarantees for CMG Group Members; (iv) entrusted loan services between CMG Group Members; (v) bills acceptances and discount services for CMG Group Members; (vi) internal money transfer and settlement and relevant settlement and clearance arrangement between CMG Group Members; (vii) internal money deposit services; (viii) loan and lease financing services for CMG Group Members; (ix) inter-bank lending business; (x) underwriting corporate bond of CMG Group Members; and (xi) marketable securities investment (fixed income).

CMG is an enterprise wholly-owned by the PRC Government (the State Council of the PRC) and supervised by the SASAC. It mainly provides services in three sectors, including transportation and related infrastructure, financial investment and asset management, and industry park and property development and management.

F. EGM

The EGM is to be held at Room 109, PDA Group Building, No. 1 Gangwan Street, Zhongshan District, Dalian City, Liaoning Province, PRC at 9:00 a.m. on Friday, 28 February 2020 to approve, among other things, the resolution in relation to the New Financial Services Agreement and the transactions contemplated thereunder as well as the proposed annual caps for each of the transactions.

Pursuant to Rule 14A.70 of the Listing Rules, any connected person and any shareholder and their associates with a material interest in the New Financial Services Agreement is required to abstain from voting on the resolution in respect of the transactions contemplated thereunder at the EGM. Therefore, CMG, the controlling shareholder of the Company, together with its associates, collectively holding 9,670,847,747 Shares (comprising 5,377,599,052 A Shares and 4,293,248,695 H Shares) of the Company amounting to approximately 75% of the total issued share capital of the Company as of the Latest Practicable Date, are required to abstain from voting at the EGM in respect of resolution to approve the New Financial Services Agreement and the transactions contemplated thereunder as well as the proposed annual caps for each of the transactions.

The notice of the EGM, sets out on pages EGM-1 to EGM-2 of this circular, was published on the website of the Hong Kong Stock Exchange on 13 January 2020, and will be dispatched together with the reply slip and proxy form. Whether or not you are able to attend the EGM, please complete and return the reply slip and the proxy form in accordance with the instructions printed thereon as soon as practicable and in any event no later than 20 days and 24 hours, respectively, before the time designated for holding the EGM or any adjournment thereof. Completion and return of the proxy form will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish.

In order to determine the holders of H Shares who are entitled to attend the EGM, the H Share register of members of the Company will be closed from Wednesday, 29 January 2020 to Friday, 28 February 2020 (both days inclusive), during which no transfer of H Shares will be effected. Holders of H Shares whose names appear on the H Shares register of members on

– 11 –

LETTER FROM THE BOARD

Friday, 28 February 2020 are entitled to attend and vote at the EGM. In order to qualify for attending and voting at the EGM, instruments of transfer accompanied by share certificates and other appropriate documents in respect of transfer of H Shares must be lodged with the Company’s H Share registrar, Computershare Hong Kong Investor Services Limited at shop 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong no later than 4:30 p.m. on Friday, 24 January 2020.

Pursuant to Rule 13.39(4) of the Hong Kong Listing Rules, the votes of the Shareholders at the EGM shall be taken by poll.

G. RECOMMENDATIONS

The Independent Board Committee has been appointed to advise the Independent Shareholders in connection with the transactions under the provision of Deposit Services under the New Financial Services Agreement. The Independent Board Committee, having considered the terms of the provision of Deposit Services under the New Financial Services Agreement, and the factors and reasons considered by the Independent Financial Adviser and its opinion as stated in its letter of advice, considers that the transactions contemplated under the provision of Deposit Services under the New Financial Services Agreement are on normal commercial terms or better and fair and reasonable so far as the Independent Shareholders are concerned, and are in the interests of the Company and the Shareholders as a whole. Accordingly, the Independent Board Committee recommends the Independent Shareholders to vote in favour of the relevant resolution to be proposed at the EGM in respect of the provision of Deposit Services under the New Financial Services Agreement and the transactions contemplated thereunder.

Given that the Directors (including the independent non-executive Directors whose opinion stated in the “Letter from the Independent Board Committee” of this circular) are of the view that the New Financial Services Agreement will be entered into in the ordinary and usual course of business of the Group with terms that are on normal commercial terms or better, fair and reasonable and in the interests of the Company and its Shareholders as a whole, the Directors recommend that the Independent Shareholders should vote in favor of the ordinary resolution in respect of the New Financial Services Agreement and the transactions contemplated thereunder.

Yours faithfully, By Order of the Board WEI Minghui Chairman

The Company is registered as Non-Hong Kong company under Part XI of the previous Hong Kong Companies Ordinance (equivalent to Part 16 of the Hong Kong Companies Ordinance with effect from 3 March 2014) under the English name “Dalian Port (PDA) Company Limited”.

For identification purpose only

– 12 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

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Dalian Port (PDA) Company Limited[] *大連港股份有限公司**

(a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2880)

13 January 2020

To the Independent Shareholders

Dear Sir or Madam,

NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS

We refer to the circular dated 13 January 2020 of the Company (the “ Circular ”) of which this letter forms part. Terms defined in the Circular have the same meanings herein unless the context otherwise requires.

We have been appointed by the Board as the Independent Board Committee to advise the Independent Shareholders on whether the terms of the provision of Deposit Services under the New Financial Services Agreement, as well as the proposed annual caps for such transactions are on normal commercial terms or better and fair and reasonable so far as the Independent Shareholders are concerned and as to whether the Independent Shareholders should approve or disapprove the ordinary resolutions in relation to the provision of Deposit Services under the New Financial Services Agreement, to be proposed at the EGM. TC Capital International Limited has been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this respect.

Your attention is drawn to the “Letter from the Board” contained in this Circular, which contains, among other things, details of the provision of Deposit Services under the New Financial Services Agreement, and the “Letter from Independent Financial Adviser” contained in this Circular, which contains its advice in respect of the terms of the provision of Deposit Services under the New Financial Services Agreement and the proposed annual caps for each of the transactions for each of the two years ending 31 December 2020 and 2021.

As the Independent Board Committee, we have discussed with the management of the Company the reasons for entering into the provision of Deposit Services under the New Financial Services Agreement, the basis upon which the terms of the provision of Deposit Services under the New Financial Services Agreement and the transactions contemplated thereunder have been determined, and the major factors taken into account by the Company in arriving at the proposed annual caps for such transactions. We have also considered the key

– 13 –

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

factors taken into consideration by the Independent Financial Adviser in forming its opinion regarding the terms of the provision of Deposit Services under the New Financial Services Agreement (including the proposed annual caps for each of the transactions) as set out in the “Letter from the Independent Financial Adviser” contained in the Circular, which we urge you to read carefully.

Having considered the terms of the provision of Deposit Services under the New Financial Services Agreement, and the advice and opinion of TC Capital in relation thereto, we are of the opinion that the provision of Deposit Services under the New Financial Services Agreement, will be conducted in the Group’s ordinary and usual course of business, on normal commercial terms or better, fair and reasonable and are in the interest of the Shareholders and the Company as a whole. We therefore recommend that you vote in favour of the ordinary resolutions to be proposed at the EGM in respect of the provision of Deposit Services under the New Financial Services Agreement and all the matters contemplated thereunder.

Yours faithfully,

For and on behalf of the Independent Board Committee

WANG Zhifeng	SUN Xiyun	LAW Man Tat
Independent non-executive	Independent non-executive	Independent non-executive
Director	Director	Director

The Company is registered as Non-Hong Kong company under Part XI of the previous Hong Kong Companies Ordinance (equivalent to Part 16 of the Hong Kong Companies Ordinance with effect from 3 March 2014) under the English name “Dalian Port (PDA) Company Limited”.
For identification purpose only

– 14 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

==> picture [44 x 59] intentionally omitted <==

==> picture [91 x 34] intentionally omitted <==

13 January 2020

The Independent Board Committee and the Independent Shareholders Dalian Port (PDA) Company Limited*

Dear Sirs,

NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

We refer to our appointment as the independent financial adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the Deposit Services and the proposed annual caps for the two years ending 31 December 2021 (the “ Annual Caps ”), details of which are set out in the Letter from the Board (the “ Letter from the Board ”) in the circular of Dalian Port (PDA) Company Limited (the “ Company ”) to the Shareholders dated 13 January 2020 (the “ Circular* ”). Capitalized terms used in this letter have the same meanings as those defined in the Circular unless the context otherwise requires.

Listing Rules Implications

As stated in the Letter from the Board, as at the Latest Practicable Date, the Company is a fellow subsidiary of CMG Finance. As such, CMG Finance is a connected person of the Company and the transactions contemplated under the New Financial Services Agreement will constitute connected transactions of the Company under Chapter 14A of the Listing Rules.

As one or more of the applicable percentage ratios for the provision of the Deposit Services under the New Financial Services Agreement is, on an annual basis, more than 5% and the proposed Annual Caps are more than HK$10,000,000, the Deposit Services are subject to the reporting, annual review, announcement and the independent shareholders’ approval requirements under Chapter 14A of the Listing Rules. As one or more of the applicable percentage ratios for the Deposit Services is, on an annual basis, more than 5% but less than 25%, the Deposit Services also constitute a discloseable transaction of the Company, and are also subject to the notification and announcement requirements under Chapter 14 of the Listing Rules.

– 15 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

We have been appointed by the Company to advise the Independent Board Committee and the Independent Shareholders as to (i) whether the Deposit Services are entered in the ordinary and usual course of business of the Company and the terms of the Deposit Services are on normal commercial terms and fair and reasonable so far as the Independent Shareholders are concerned; (ii) whether the Deposit Services are in the interests of the Company and the Shareholders as a whole and the Annual Caps are fair and reasonable; and (iii) how the Independent Shareholders should vote in favour of the relevant resolution to approve the Deposit Services and the Annual Caps.

OUR INDEPENDENCE

As at the Latest Practicable Date, we did not have any relationships or interests with the Company or any other parties that could reasonably be regarded as relevant to the independence of us. In the last two years, we have acted as an independent financial adviser to the then independent board committee and independent shareholders of the Company in relation to an occasion as detailed in the circular of the Company dated 13 November 2018. Apart from normal professional fee paid to us in connection with the aforesaid appointment, no arrangements exist whereby we have received any fees or benefits from the Company or any other party to the transactions during the two years prior to the Latest Practicable Date, therefore we consider such relationship would not affect our independence to form our opinion in respect of the Deposit Services.

BASIS OF OUR OPINION

In putting forth our recommendation, we have relied on the information, opinions, facts and representations supplied to us by the Directors and/or the representatives of the Company. We have reviewed, among other things, (i) the New Financial Services Agreement; (ii) the interim report of the Company for the six months ended 30 June 2019 (the “ 2019 Interim Report ”); (iii) the annual report of the Company for the year ended 31 December 2018 (the “ 2018 Annual Report ”); and (iv) other information as set out in the Circular.

We have assumed that all such information, opinions, facts and representations, which have been provided to us by the Directors and/or the representatives of the Company, for which they are fully responsible, are true, accurate and complete in all respects. We have no reason to doubt the truth, accuracy and completeness of the information and representations provided to us by the Company and/or the representations of the Company. The Company has also confirmed to us that no material facts have been omitted from the information supplied and we have no reason to suspect that any material information has been withheld by the Company or is misleading.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

We consider that we have sufficient information currently available to reach an informed view and to provide a reasonable basis for our recommendation. We have not, however, carried out any independent verification of the information provided by the Directors and the representatives of the Company, nor have we conducted any independent investigation into the business, affairs, operations, financial position or future prospects of each of the Group, the counterparties to the Deposit Services and any of their respective subsidiaries and associates.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In formulating our opinion in respect of the Deposit Services and the Annual Caps, we have taken into account the following principal factors and reasons:

1. Background information of the Deposit Services

(a) The Group

As stated in the Letter from the Board, the principal activities of the Group are: oil/liquefied chemical terminal and the related logistics services (Oil Segment); container terminal and related logistics services (Container Segment); automobile terminal and related logistics services (Automobile Terminal Segment); bulk and general cargo terminal and related logistics services (Bulk and General Cargo Segment); bulk grain terminal and related logistics services (Bulk Grain Segment); passenger and roll-on, roll-off terminal and related logistics services (Passenger and Ro-Ro Segment) and value-added and ancillary port operations (Value-added Services Segment).

The table set below is the financial information of the Group for the two years ended 31 December 2018 and the six months ended 30 June 2018 and 30 June 2019 and as at 31 December 2017 and 2018 and 30 June 2019 as extracted from the 2018 Annual Report and the 2019 Interim Report:

	For the year ended	For the year ended	For the six months ended	For the six months ended	For the six months ended
	31 December		30	June
	2017	2018	2018		2019
	RMB	RMB
	(approximately)	(approximately)	RMB		RMB
	(Audited)	(Audited)	(Unaudited)		(Unaudited)
Revenue	9,031,643,350	6,754,444,902	3,651,188,687	3,221,965,028
Gross profit	1,463,440,843	1,612,709,720	767,626,521		881,512,954
Net profit attributable to shareholders
of the parent company	500,779,944	523,315,600	176,180,848		288,235,815

– 17 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

			As at
	As at 31	December	30 June
	2017	2018	2019
	RMB	RMB	RMB
	(approximately)	(approximately)	(approximately)
	(Audited)	(Audited)	(Unaudited)
Cash at bank and on hand	7,507,917,167	5,729,285,870	3,742,118,123
Total assets	36,585,275,806	35,315,583,173	36,292,878,029
Total liabilities	15,965,477,732	14,455,267,229	15,290,738,041
Net assets	20,619,798,074	20,860,315,944	21,002,139,988

As stated in the 2019 Interim Report, in the first half of 2019, the gross profit of the Group increased significantly as compared with the corresponding period of last year, mainly attributable to the increase of crude oil storage business, which is partially offset by the reduced sales of general cargo and bulk grain business, and the decrease of harbour dues caused by policy factors. The increase in crude oil storage and LNG business has driven the performance growth of investees and the application of tax reduction policies has increased tax revenues, and those reasons lead to the increase of operating profit. However, the profit margin was cut down, which is attributed to, among others, reduced exchange gains resulted from exchange rate fluctuations in capital market, and increased financial costs due to the implementation of new lease standards. In light of the above, the Group’s net profit attributable to the parent company reported a year-on-year increase of 63.6%.

As stated in the 2018 Annual Report, in 2018, the Group’s gross profit increased significantly year-on-year, mainly due to the increase of revenue as a result of the consolidation of container terminals and the growth of ore mixing business which have driven the increase of gross profit, partially offset by the decline of sales in the oil product business and bulk grain business. In this year, the Group’s currency exchange gains increased as a result of the exchange rate fluctuation in the capital market, expected credit loss was provided due to the adoption of the New Financial Instruments Standard, government grants decreased as a result of policy factors, and staff costs increased as well. In light of the above, the Group’s net profit attributable to the parent reported a year-on-year increase of 4.5%.

The cash at bank and on hand of the Group as at 31 December 2018 was approximately RMB5,729,285,870, representing a decrease of approximately 23.7% as compared to that as at 31 December 2017. The representative of the Company advised that such decrease was mainly due to the payment of borrowings using own funds for the year. The cash at bank and on hand of the Group as at 30 June 2019 further decreased to approximately RMB3,742,118,123, representing a decrease of approximately 34.7% as compared to that as at 31 December 2018 which was mainly due to the repayment of short-term loan in the first half of 2019. The net assets of the Group as at 31 December 2018 were approximately RMB20,860,315,944, representing an increase of approximately 1.2% as compared to that as at 31 December 2017 which was mainly due to the increase in the net profit for the year ended 31 December 2018. The net assets of the Group as at 30 June 2019 remained constant as compared with that as at 31 December 2018.

– 18 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

(b) The Deposit Services

Pursuant to the New Financial Services Agreement, CMG Finance shall provide the Deposit Services to the Group. As stated in the Letter from the Board, the principal business activities of CMG Finance include (i) provision of financial advice, credit authentication and relevant consulting and agency services for members of the CMG Group (the “ CMG Group Members ”); (ii) assistance in collection and payment of transaction money for CMG Group Members; (iii) provision of guarantees for CMG Group Members; (iv) entrusted loan services between CMG Group Members; (v) bills acceptances and discount services for CMG Group Members; (vi) internal money transfer and settlement and relevant settlement and clearance arrangement between CMG Group Members; (vii) internal money deposit services; (viii) loan and lease financing services for CMG Group Members; (ix) inter-bank lending business; (x) underwriting corporate bond of CMG Group Members; and (xi) marketable securities investment (fixed income).

– 19 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

2. Reasons for and benefits of entering into the Deposit Services

The representative of the Company advised that the New Financial Services Agreement does not restrict the Group to the Deposit Services provided by third party and therefore offers an additional financing option to the Group and increases the financial flexibility of the Group. Therefore, the Group may, but is not obliged to, use the services of CMG Finance if the price is competitive.

Having considered that (i) the terms of the Deposit Services are fair and reasonable as mentioned in the paragraph headed “Principal terms of the Deposit Services” below; and (ii) the Deposit Services do not restrict the Group to obtain the same services only from CMG Finance, we concur with the Directors’ view that entering into the Deposit Services are in the ordinary and usual course of the business of the Company and in the interests of the Company and the Independent Shareholders as a whole.

3. Principal terms of the Deposit Services

On 20 December 2019, the Company entered into the New Financial Services Agreement with CMG Finance pursuant to which CMG Finance shall provide the Deposit Services to the Group on normal commercial terms or better for a term of two years commencing on the date of the EGM and ending on 31 December 2021. Details of the terms of the Deposit Services are stated in the Letter from the Board. Set out below is the pricing of the Deposit Services.

Pursuant to the New Financial Services Agreement, the interest rate payable by CMG Finance to the Group for any deposits should not be lower than interest rate paid by other major commercial banks in the PRC for comparable deposits. According to the Letter from the Board, the interest rate payable by CMG Finance to the Group for any deposits should also not be lower than the interest rate prescribed by People’s Bank of China for comparable deposits. Given that the interests to be received from CMG Finance for the Deposit Services were no less favorable terms to the Group, we are of the view that the pricing of the Deposit Services are fair and reasonable so far as the Independent Shareholders are concerned.

– 20 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

4. The Annual Caps and basis of determination

The Annual Caps of the Deposit Services are RMB4,000,000,000 for each of the two years ending 31 December 2021. There was no historical transaction of deposit services between the Group and CMG Finance in the last three financial years. As stated in the paragraph headed “the Deposit Services” above, the CMG Finance Transactions will gradually replace the corresponding transactions under the Financial Services Agreement. Set out below is the maximum daily closing balance of deposit services between the Group and PDA and its associates or subsidiary(ies) (as the case may be) (including Dalian Port Finance, which is a subsidiary of PDA) for the two years ended 31 December 2018 and for the nine months ended 30 September 2019:

						For the nine
						months
				For the year	ended	ended
				31 December		30 September
				2017	2018	2019
				RMB’000	RMB’000	RMB’000
Maximum	daily	closing	balance	3,164,850	3,665,619	3,576,264

As shown in the above table, the historical maximum daily closing balance of the deposit between the Group and PDA and its associates or subsidiary(ies) (as the case may be) (including Dalian Port Finance, which is a subsidiary of PDA) for the two years ended 31 December 2018 and for the nine months ended 30 September 2019 was approximately RMB3,164.9 million, RMB3,665.6 million and RMB3,576.3 million respectively. Given that the Annual Caps of the Deposit Services is set to accommodate the maximum daily balance of deposit and interest income for the two years ending 31 December 2021, we consider it is justifiable to use the maximum daily closing balance of the deposit services between the Group and PDA and its associates or subsidiary(ies) (as the case may be) (including Dalian Port Finance, which is a subsidiary of PDA) for the two years ended 31 December 2018 and for the nine months ended 30 September 2019 of RMB3,665.6 million and a buffer in setting the Annual Caps of the Deposit Services. We are of the view that the Annual Caps of the Deposit Services are determined based on reasonable estimation and after due and careful consideration and are fair and reasonable so far as the Company and the Independent Shareholders are concerned.

Shareholders should note that as the Annual Caps are relating to future events and was estimated based on assumptions which may or may not remain valid for the entire period up to 31 December 2021, and they do not represent forecasts of the amount of the Deposit Services. Consequently, we express no opinion as to how closely the actual amount of the Deposit Services will correspond with the respective Annual Caps.

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LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

5. Internal control measures

We have discussed with the officer of finance department of the Company and were advised that when the benchmark interest rates for deposits published by People’s Bank of China or the interest rates provided by connected persons (the “ Agreed Rates ”) change, the officer of the finance department of the Company will check whether the interest rates provided by connected persons is not lower than the benchmark interest rates for deposits published by People’s Bank of China and interest rates paid by other major commercial banks in the PRC for comparable deposits and the manager of the finance department of the Company will review the abovementioned documents. We have obtained and reviewed one set of the abovementioned documents prepared by the officer of the finance department of the Company when the benchmark interest rates for deposits published by People’s Bank of China changed in 2015, i.e. the internal interest rate of a connected person effective from the date of above change, the benchmark interest rates for deposits published by People’s Bank of China effective from the date of above change and interest rates effective from the date of above change offered by two major commercial banks in the PRC which have established business relationship with the Group and noted that the interest rates provided by the connected person is not lower than the benchmark interest rates for deposits published by People’s Bank of China and interest rate offered by other major commercial banks in the PRC for comparable deposits. As advised by the manager of the finance department of the Company, the Company, prior to the placement of deposit with connected persons, checks interest rates offered by connected persons against the Agreed Rates.

The Group has adopted 大連港股份有限公司關聯交易管理辦法 (Dalian Port (PDA) Company Limited Connected Transaction Management Measure) (the “ Measure ”) to monitor the continuing connected transactions. We have obtained and reviewed the Measure and noted that the Measure states that the departments or units of the conducting connected transaction should report the amount of the connected transactions to the finance department of the Company via 股份公司關聯交易統計系統 (the connected transactions accounting system of the Company) on the next date of each month end of the monthly financial statements. Those departments and units are responsible for truthfulness, accuracy and completeness of those information. Furthermore, the finance department of the Company is responsible for (i) collecting the transaction amounts of the continuing connected transactions; (ii) reporting the status of the continuing connected transactions to the independent directors and the audit committee periodically; and (iii) making corresponding measures if discovering the annual caps of the continuing connected transactions may be exceed. The representative of the Company advised that the units of the conducting connected transaction should enter the transaction amount of the continuing connected transactions to an accounting system of the Company. The finance department of the Company collects the transaction amount of the continuing connected transactions from the accounting system and then reports the status of the continuing connected transactions to the independent directors and the audit committee quarterly. We have obtained and reviewed the screenshot of the accounting system and noted that the accounting system showed the closing balance of the deposit with a connected person as at month ended. Moreover, we have obtained and reviewed the quarterly report of continuing connected transactions prepared by the finance department of the Company to the independent directors and the audit committee and noted that the maximum daily closing balance of the deposit with connected persons as at the end of the quarter and whether the maximum daily closing balance of the deposit with connected persons exceeds the cap were reported.

– 22 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Moreover, as stated in the 2018 Annual Report, the independent non-executive directors of the Company had reviewed the continuing connected transactions and confirmed that those transactions have been entered into: (i) in the ordinary and usual course of business of the Group; (ii) either on normal commercial terms or, if there are no sufficient comparable transactions to judge whether they are on normal commercial terms, on terms better than terms available to independent third parties; and (iii) in accordance with the agreements governing the relevant transactions on terms that are fair and reasonable and in the best interests of the shareholders of the Company as a whole. Pursuant to Rule 14A.38 of the Listing Rules, the Board of the Company engaged the auditors to perform certain agree-upon procedures in respect of the continuing connected transactions for the year 2018. The auditors have reported their factual findings on these procedures to the Board with a letter and provided confirmations on those continuing connected transactions in accordance with Rule 14A.38 of the Listing Rules. The auditor has accordingly issued an assurance report on the Company’s continuing connected transactions for the year ended 31 December 2018, and has confirmed the following regarding the continuing connected transactions of the Company disclosed in the 2018 Annual Report: (i) nothing has come to their attention that causes them to believe that the disclosed continuing connected transactions have not been approved by the Company’s board of directors; (ii) for transactions involving the provision of goods or services by the Group, nothing has come to their attention that causes them to believe that the transactions were not, in all material respects, in accordance with the pricing policies of the Group; (iii) nothing has come to their attention that causes them to believe that the transactions were not entered into, in all material respects, in accordance with the relevant agreements governing such transactions; and (iv) with respect to the aggregate amount of the disclosed continuing connected transactions, nothing has come to their attention that causes them to believe that the disclosed continuing connected transactions have exceeded the annual caps as set by the Company.

Taking into account the internal control measures as stated above, we concur with the Directors’ view that the Company has established internal control procedures to ensure the Deposit Services will be conducted on normal commercial terms, fair and reasonable and in the interest of the Company and the Shareholders as a whole and the Deposit Services will be implemented in accordance with the New Financial Services Agreement.

– 23 –

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

RECOMMENDATION

Having considered the principal factors and reasons as discussed above, we are of the view that the Deposit Services are entered in the ordinary and usual course of business of the Company, the terms of the Deposit Services are on normal commercial terms, fair and reasonable so far as the Independent Shareholders are concerned and in the interests of the Company and the Shareholders as a whole and the Annual Caps are fair and reasonable. Accordingly, we would recommend (i) the Independent Board Committee to advise the Independent Shareholders; and (ii) the Independent Shareholders, to vote in favour of the ordinary resolution in this regard.

Yours faithfully, For and on behalf of TC Capital International Limited Edward Wu

Chairman

Note: Mr. Edward Wu has been a responsible officer of Type 6 (advising on corporate finance) regulated activities under the SFO since 2005. He has participated in and completed various advisory transactions in respect of connected transactions of listed companies in Hong Kong.
for identification purpose only

– 24 –

GENERAL INFORMATION

APPENDIX I

1. 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 to the best of their knowledge and belief that the information contained in this circular is accurate and complete in all material respects and not misleading and deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

2. FINANCIAL INFORMATION OF THE GROUP

The 2018 financial statements are set out on pages 112 to 339 of the annual report of the Company for the year ended 31 December 2018, which was published on 24 April 2019. The annual report of the Company for the year ended 31 December 2018 is posted on the websites of the Stock Exchange and the Company. Please also see below a direct link:

http://www3.hkexnews.hk/listedco/listconews/SEHK/2019/0424/LTN20190424476.pdf

The 2017 financial statements are set out on pages 100 to 302 of the annual report of the Company for the year ended 31 December 2017, which was published on 24 April 2018. The annual report of the Company for the year ended 31 December 2017 is posted on the websites of the Stock Exchange and the Company. Please also see below a direct link:

http://www3.hkexnews.hk/listedco/listconews/SEHK/2018/0424/LTN20180424341.pdf

The 2016 financial statements are set out on pages 95 to 286 of the annual report of the Company for the year ended 31 December 2016, which was published on 27 April 2017. The annual report of the Company for the year ended 31 December 2016 is posted on the websites of the Stock Exchange and the Company. Please also see below a direct link:

http://www3.hkexnews.hk/listedco/listconews/SEHK/2017/0427/LTN20170427427.pdf

The unaudited condensed consolidated financial statements of the Group for the six months ended 30 June 2019 and notes thereto are set out on pages 29 to 248 of the interim report of the Company for the six months ended 30 June 2019, which was published on 25 September 2019. The interim report of the Company for the six months ended 30 June 2019 is posted on the websites of the Stock Exchange and the Company. Please also see below a direct link:

https://www1.hkexnews.hk/listedco/listconews/sehk/2019/0925/ltn20190925143.pdf

– I-1 –

GENERAL INFORMATION

APPENDIX I

3. DISCLOSURE OF INTERESTS

(a) Interests and short positions of Directors, supervisors and chief executives of the Company in shares, underlying shares and debentures

As at the Latest Practicable Date, as far as the Company was aware, none of the Directors, supervisors or chief executive of the Company had any interests or short positions in the shares, underlying shares or debentures of the Company or any of its associated corporations (within the meaning of Part XV of the SFO) which should be recorded in the register required to be kept by the Company pursuant to Section 352 of the SFO, or as otherwise should be notified to the Company and the Hong Kong Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO and the Model Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix 10 to the Listing Rule (the “ Model Code ”).

(b) Interests and short positions of substantial shareholders of the Company in shares, underlying shares and debentures

As at the Latest Practicable Date, so far as is known to the Company, the following persons or entities, other than the Directors, supervisors or chief executive of the Company, had interests or short positions in the shares or underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO, or as recorded in the register required to be kept by the Company under section 336 of the SFO:

				Approximate
				percentage of	Approximate
				the relevant	percentage of
Name of	Class of	Number of		class of	the total
Substantial Shareholders	Shares	Shares(1)	Capacity	share capital(2)	share capital(3)
PDA	A Shares	5,310,255,162(L)	Beneficial	68.65%	41.18%
			owner
China Merchants Securities	H Shares	2,720,755,000(L)	Interest of	52.74%	21.10%
(HK) Co., Ltd.			controlled
			corporation
China Securities Depository	H Shares	883,126,200(L)	Beneficial	17.12%	6.85%
and Clearing Corporation			owner
Limited
PDA	H Shares	722,166,000(L)	Beneficial	14.00%	5.60%
			owner

– I-2 –

GENERAL INFORMATION

APPENDIX I

Notes:

(1) (L) – Long position; (S) – Short position; (P) – Lending pool
(2) Number of Shares in the relevant class of share capital of the Company as at the Latest Practicable Date: A Shares – 7,735,820,000; H Shares – 5,158,715,999.
(3) Total number of Shares in the share capital of the Company as at the Latest Practicable Date: 12,894,535,999.

Save as disclosed above, as at the Latest Practicable Date, so far as known to the Company, no other person had an interest or short position in the shares of the Company which would fall to be disclosed to the Company and the Hong Kong Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO or as recorded in the register required to be kept by the Company under section 336 of the SFO.

4. DIRECTORS’ SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed service contract with any member of the Group which does not expire or is not determinable by such member of the Group within one year without payment of compensation (other than statutory compensation).

5. COMPETING INTERESTS

As at the Latest Practicable Date, none of the Directors, or their respective close associates had any interests in a business which competes or was likely to compete, either directly or indirectly, with the business of the Group and which was required to be disclosed pursuant to Rule 8.10 of the Listing Rules.

6. DIRECTOR’S OR SUPERVISOR’S INTERESTS IN THE GROUP’S ASSETS OR CONTRACTS

As at the Latest Practicable Date, to the best knowledge and information of the Directors, none of the Directors, supervisors of the Company had any interest in any assets which has been, since 31 December 2018 (being the date to which the latest published audited accounts of the Company were made up), acquired or disposed of by or leased to any member of the Group, or were proposed to be acquired or disposed of by or leased to any member of the Group.

As at the Latest Practicable Date, to the best knowledge and information of the Directors, none of the Directors or supervisors was materially interested in any contract or arrangement subsisting at the Latest Practicable Date which is significant in relation to the business of the Group.

– I-3 –

GENERAL INFORMATION

APPENDIX I

7. EXPERT’S QUALIFICATION AND CONSENT

The following is the qualification of the expert or professional adviser who has given its opinion or advice contained in this circular:

Name

Qualification

TC Capital International A licensed corporation under the SFO to engage in type 1 Limited (dealing in securities) and type 6 (advising on corporate finance) of the regulated activities as set out in schedule 5 of the SFO

TC Capital has given and has not withdrawn its written consent to the issue of this circular with the inclusion of its letter and/or report, as the case may be, and references to its name and logo in the form and context in which they appear.

As at the Latest Practicable Date, TC Capital did not have any direct or indirect interest in any assets which had been acquired, disposed of by, or leased to any member of the Group, or was proposed to be acquired, or disposed of by, or leased to any member of the Group, since 31 December 2018, the date to which the latest audited financial statements of the Group were made up; and was not beneficially interested in the share capital of any member of the Group and did not have any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

8. MATERIAL ADVERSE CHANGE

The Directors confirm that there was no material adverse change in the financial or trading position of the Group since 31 December 2018 (being the date to which the latest published audited financial statements of the Company were made up).

9. LITIGATION

As at the Latest Practicable Date, no member of the Group was engaged in any litigation or arbitration proceedings of material importance and there is no litigation or claim of material importance known to the Directors to be pending or threatened by or against any member of the Group.

– I-4 –

GENERAL INFORMATION

APPENDIX I

10. GENERAL

(a) The joint company secretaries of the Company are Ms. Wang Huiying and Mr. Lee Kin Yu Arthur. Mr. Lee is a member of the American Institute of Certified Public Accountants and the Hong Kong Institute of Certified Public Accountants.
(b) The registered office of the Company is situated at Xingang Commercial Building, Dayao Bay, Dalian Free Trade Zone, PRC. The place of business of the Company is at Xinggang Commercial Building, Jingang Road, Dalian International Logistic Park Zone, Liaoning Province, PRC.
(c) The branch share registrar of the Company in Hong Kong is Computershare Hong Kong Investor Services Limited at shop 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong.
(d) The English text of this circular shall prevail over the Chinese text in case of any inconsistency.

11. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents are available for inspection at 21-22/F, Bank of China Tower, 1 Garden Road, Central, Hong Kong during normal business hours on any business day (i.e., from 9:30 a.m. to 5:00 p.m. on Monday to Friday) for a period of 14 days from the date of this circular:

(a) the letter from the Independent Board Committee, the text of which is set out on pages 13 to 14 of this circular;
(b) the letter of advice from TC Capital to the Independent Board Committee and Independent Shareholders, the text of which is set out on pages 15 to 24 of this circular;
(c) the New Financial Services Agreement;
(d) the written consent referred to in the paragraph headed “Expert’s Qualification and Consent” in this appendix;
(e) the annual reports of the Company for the three years ended 31 December 2016, 2017 and 2018;
(f) the interim report of the Company for the six months ended 30 June 2019; and
(g) this circular.

– I-5 –

APPENDIX II

CERTAIN CONTINUING CONNECTED TRANSACTIONS REQUIRING INDEPENDENT SHAREHOLDERS’ APPROVAL UNDER THE SHANGHAI LISTING RULES

Details of the provision of Loan Services and Settlement Services and other financial services under the New Financial Services Agreement are as follows:

I. SUMMARY OF THE TRANSACTIONS

1. Loan Services

Pursuant to the New Financial Services Agreement, CMG Finance shall provide Loan Services to the Group on normal commercial terms or better to the Group for a term commencing on the date of the EGM and ending on 31 December 2021.

(a) Pricing

Pursuant to the New Financial Services Agreement, the interest rate for any loan provided by CMG Finance to the Group should not be higher than the rate charged by other financial institutions in the PRC for comparable loans. In addition, the daily closing balance of the Group’s loan with CMG Finance including the Group’s loan (plus accrued interests and service fee) with PDA and its associates or subsidiary(ies) (as the case may be) under the Financial Services Agreement should not exceed RMB5.0 billion.

(b) Historical figures for each of the two years ended 31 December 2017 and 2018, the nine months ended 30 September 2019, estimated amount for the year ending 31 December 2019 and estimated annual caps for each of the two years ending 31 December 2020 and 2021

				Estimated	Estimated	Estimated
			For	amount for	annual cap	annual cap
	For the	For the	9 months	the year	for year	for the
	year ended	year ended	ended	ending	ending	year ending
	31 December	31 December	30 September	31 December	31 December	31 December
	2017	2018	2019	2019	2020	2021
	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)
Financial Services –	981,840(1)	949,117(1)	792,072(1)	5,000,000(2)	5,000,000(3)	5,000,000(3)
Loan Services
(maximum daily
closing balance)

Notes:

(1) The figures relate to transactions in respect of the loan services between the Company and PDA that constituted connected transactions under the Shanghai Listing Rules. The historical annual caps in respect of the loan services between the Company and PDA for the years ended 31 December 2017 and 2018 are RMB5.0 billion, respectively.

– II-1 –

APPENDIX II

CERTAIN CONTINUING CONNECTED TRANSACTIONS REQUIRING INDEPENDENT SHAREHOLDERS’ APPROVAL UNDER THE SHANGHAI LISTING RULES

(2) The estimated amount for 2019 relates to the annual cap in respect of the loan services between the Company and PDA which is the total of that approved by the Shareholders under the Shanghai Listing Rules.
(3) In determining the estimated annual caps for each of the two years ending 31 December 2020 and 2021 in respect of the Loan Services between the Company and CMG Finance, the Company considered transactions that will constitute connected transactions under the Shanghai Listing Rules.

In determining the estimated annual caps for 2020 and 2021 in respect of the Loan Services between the Company and CMG Finance, the Directors have considered (i) the historical figures of the maximum daily outstanding balance of loans (including accrued interest and service fee) in respect of the loan services between the Company and PDA for the years ended 31 December 2017 and 2018 and the nine months ended 30 September 2019 as shown in the table above, (ii) the Group’s working capital needs, and (iii) financial ability of CMG Finance for providing loan or credit to, and guarantee for the Group.

2. Settlement Services and other financial services

Pursuant to the New Financial Services Agreement, CMG Finance shall provide Settlement Services and other financial services to the Group on normal commercial terms or better to the Group for a term commencing on the date of the EGM and ending on 31 December 2021.

(a) Pricing

Pursuant to the New Financial Services Agreement, the Company expects that the total annual fees payable by the Group to CMG Finance for the Settlement Services and other financial services including the total annual fees payable by the Group to PDA and its associates or subsidiary(ies) (as the case may be) under the Financial Services Agreement will not exceed RMB30.0 million per year for each of the two years ending 31 December 2020 and 2021. On-shore Settlement Services are provided by CMG Finance free of charge and the settlement rate for cross-border and off-shore Settlement Services shall not be higher than the service fee for comparable financial institutions in the PRC and abroad. In addition, the fees payable by the Group to CMG Finance shall not be higher than the fees charged by major financial institutions in the PRC.

– II-2 –

CERTAIN CONTINUING CONNECTED TRANSACTIONS REQUIRING INDEPENDENT SHAREHOLDERS’ APPROVAL UNDER THE SHANGHAI LISTING RULES

APPENDIX II

(b) Historical figures for each of the two years ended 31 December 2017 and 2018, the nine months ended 30 September 2019, estimated amount for the year ending 31 December 2019 and estimated annual caps for each of the two years ending 31 December 2020 and 2021

				Estimated		Estimated
			For	amount for	Estimated	annual cap
	For the	For the	9 months	the year	annual cap for	for year
	year ended	year ended	ended	ending	year ending	ending
	31 December	31 December	30 September	31 December	31 December	31 December
	2017	2018	2019	2019	2020	2021
	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)	(RMB’000)
Financial Services –	180(1)	103(1)	55(1)	30,000(2)	30,000(3)	30,000(3)
Settlement Services
and other financial
services

Notes:

(1) The figures relate to transactions in respect of the settlement services and other financial services between the Company and PDA that constituted connected transactions under the Shanghai Listing Rules. The historical annual caps in respect of the settlement services and other financial services between the Company and PDA for the years ended 31 December 2017 and 2018 are RMB30.0 million, respectively.
(2) The estimated amount for 2019 relates to the annual cap in respect of the settlement services and other financial services between the Company and PDA which is the total of that approved by the Shareholders under the Shanghai Listing Rules.
(3) In determining the estimated annual caps for each of the two years ending 31 December 2020 and 2021 in respect of the Settlement Services and other financial services between the Company and CMG Finance, the Company considered transactions that will constitute connected transactions under the Shanghai Listing Rules.

As the on-shore Settlement Services shall be provided free of any service charge, the estimated annual caps for 2020 and 2021 in respect of the Settlement Services and other financial services between the Company and CMG Finance are determined in connection with the provision of the cross-border and off-shore settlement services and the proposed other financial services. The Directors have considered a number of factors in determining the estimated annual caps, including: (i) the historical amounts of handling fees in respect of the settlement services and other financial services between the

– II-3 –

CERTAIN CONTINUING CONNECTED TRANSACTIONS REQUIRING INDEPENDENT SHAREHOLDERS’ APPROVAL UNDER THE SHANGHAI LISTING RULES

APPENDIX II

Company and PDA for the years ended 31 December 2017 and 2018 and the year ending 31 December 2019 as shown in the table above, (ii) the expected introduction of new financial services such as provision of secured financing, and bank acceptance bill, and (iii) the operational and financial needs of the Group in the coming two years.

II. REASONS AND BENEFITS FOR ENTERING INTO THE TRANSACTIONS

The Directors believe that the transactions mentioned in section I above can ensure that the operational and business development needs of the Group are effectively met, with terms and conditions of the transactions being not less favourable to the Group than that those available from independent third parties. The terms and conditions of each of the transactions mentioned in section I above are on normal commercial terms or better, fair and reasonable and in the interests of the Company and the Shareholders as a whole.

III. OPINIONS OF THE BOARD

On 6 December 2019, the Board has approved, amongst others, the provision of Loan Services and Settlement Services and other financial services under the New Financial Services Agreement, as well as the proposed annual caps for such transactions.

– II-4 –

NOTICE OF EGM

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Dalian Port (PDA) Company Limited[] *大連港股份有限公司**

(a sino-foreign joint stock limited company incorporated in the People’s Republic of China)

(Stock Code: 2880)

NOTICE OF EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that the extraordinary general meeting (“ EGM ”) of Dalian Port (PDA) Company Limited (the “ Company* ”) will be held at Room 109, PDA Group Building, No. 1 Gangwan Street, Zhongshan District, Dalian City, Liaoning Province, the PRC at 9:00 a.m. on Friday, 28 February 2020 for the purposes of considering and, if thought fit, passing (with or without modifications) the following resolution. Unless otherwise indicated, capitalized terms used herein shall have the same meanings as defined in the announcement of the Company dated 20 December 2019.

A circular containing, among other things, a letter of advice from the independent financial adviser to both the Independent Board Committee and the Independent Shareholders and a letter of recommendation from the Independent Board Committee to the Independent Shareholders and the details of the transactions contemplated in the following resolution will be dispatched to the Shareholders on or before 13 January 2020 in accordance with the Listing Rules.

ORDINARY RESOLUTION

the New Financial Services Agreement and the transactions contemplated thereunder, and the related proposed annual caps (including the annual caps for each of the two years ending 31 December 2020 and 2021 for transactions that will only constitute connected transactions under Chapter 14A of the Listing Rules) be and are hereby approved, confirmed and ratified, and authorize the Board or any executive director of the Company to do all such acts and things and execute all such documents and to take all such steps as it considers necessary or expedient or desirable in connection with or to give effect to the agreement.

By Order of the Board WANG Huiying LEE Kin Yu, Arthur Joint Company Secretaries

13 January 2020

– EGM-1 –

NOTICE OF EGM

Notes:

Pursuant to Rule 13.39(4) of the Listing Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, votes of the Shareholders at the EGM shall be taken by poll.
Any Shareholder entitled to attend and vote at the EGM is entitled to appoint one or more proxies to attend and vote on his/her/its behalf at the EGM. A proxy need not be a Shareholder. Shareholders shall have one vote for each Share that they hold.
In order to determine the holders of H Shares who are entitled to attend the EGM, the H Share registers of members of the Company shall be closed from Wednesday, 29 January 2020 to Friday, 28 February 2020 (both days inclusive), during which no transfer of H Shares will be registered. Holders of H Share whose names appear on the registers of members on Friday, 28 February 2020 are entitled to attend the EGM. In order to be entitled to attend and vote at the EGM, holders of H Shares whose transfers have not been registered shall lodge the transfer documents together with the relevant share certificates at the H Share registrar of the Company, Computershare Hong Kong Investor Services Limited, at Shop 1712-1716, Hopewell Centre, 183 Queen’s Road East, Wanchai, Hong Kong no later than 4:30 p.m. on Friday, 24 January 2020.
The instruments appointing a proxy must be in writing under the hand of the Shareholder or his/her attorney duly authorized in writing. If the Shareholder is a corporation, that instrument must be either under the company seal or under the hand of its director or duly authorized attorney. If that instrument is signed by an attorney of the Shareholder, the power of attorney authorizing that attorney to sign or other authorization documents must be notarized.
The proxy form together with the power of attorney or other authorization document (if any) must be deposited at the office of Board, at the address as stated in Note 7 below for holders of the A Shares and at the H Share registrar, Computershare Hong Kong Investor Services Limited at the address as stated in Note 3 above for holders of the H Shares, not less than 24 hours before the time fixed for holding the EGM or any adjournment thereof (as the case may be).

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

Shareholders who intend to attend the EGM in person or by proxy should return the reply slip to the office of the Board at the address as stated in Note 7 below on or before Friday, 7 February 2020 by hand, by post or by fax.
The contact details of the office of the Board are as follows:

26/F Xingang Commercial Building Jingang Road Dalian International Logistic Park Zone Liaoning Province PRC Postal Code: 116601 Telephone No.: 86 411 8759 9899/8759 9900/8759 9901 Facsimile No.: 86 411 8759 9854

Shareholders or their proxies attending the EGM shall be responsible for their own transportation and accommodation expenses.
The meeting is expected to be concluded within a day. Shareholders (in person or by proxy) attending the meeting are responsible for their own transportation and accommodation expenses. Shareholders or their proxies attending the meeting shall produce the identity documents.

As at the date of this notice, the Board comprises:

Executive director: WEI Minghui

Non-executive directors: CAO Dong, LI Jianhui and YUAN Yi

Independent non-executive directors: WANG Zhifeng, SUN Xiyun and LAW Man Tat

– EGM-2 –

AI assistant

Liaoning Port Co., Ltd. — Proxy Solicitation & Information Statement 2020

50786_rns_2020-01-13_b852e3c9-4a3b-438a-bc3e-e503c81e713b.pdf

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Dalian Port (PDA) Company Limited[] 大連港股份有限公司*

NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS AND NOTICE OF EGM

DEFINITIONS

DEFINITIONS

DEFINITIONS

Dalian Port (PDA) Company Limited[] 大連港股份有限公司*

NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS AND NOTICE OF EGM

A. INTRODUCTION

B. NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS

LETTER FROM THE BOARD

1.1 Financial Services – Deposit Services

(a) Pricing

(c) Internal control

C. REASON FOR AND BENEFITS OF ENTERING INTO THE NEW FINANCIAL SERVICES AGREEMENT

Effect on the earnings, assets and liabilities of the Company in relation to the entering into of the New Financial Services Agreement

D. LISTING RULES IMPLICATIONS

1. New Discloseable and Continuing Connected Transactions

2. General

E. GENERAL INFORMATION

F. EGM

G. RECOMMENDATIONS

Dalian Port (PDA) Company Limited[] 大連港股份有限公司*

(Stock Code: 2880)

NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS

Yours faithfully,

The Independent Board Committee and the Independent Shareholders Dalian Port (PDA) Company Limited*

NEW DISCLOSEABLE AND CONTINUING CONNECTED TRANSACTIONS

INTRODUCTION

Listing Rules Implications

OUR INDEPENDENCE

BASIS OF OUR OPINION

PRINCIPAL FACTORS AND REASONS CONSIDERED

1. Background information of the Deposit Services

(a) The Group

(b) The Deposit Services

2. Reasons for and benefits of entering into the Deposit Services

3. Principal terms of the Deposit Services

4. The Annual Caps and basis of determination

5. Internal control measures

RECOMMENDATION

Yours faithfully, For and on behalf of TC Capital International Limited Edward Wu

1. RESPONSIBILITY STATEMENT

2. FINANCIAL INFORMATION OF THE GROUP

3. DISCLOSURE OF INTERESTS

(a) Interests and short positions of Directors, supervisors and chief executives of the Company in shares, underlying shares and debentures

(b) Interests and short positions of substantial shareholders of the Company in shares, underlying shares and debentures

4. DIRECTORS’ SERVICE CONTRACTS

5. COMPETING INTERESTS

6. DIRECTOR’S OR SUPERVISOR’S INTERESTS IN THE GROUP’S ASSETS OR CONTRACTS

7. EXPERT’S QUALIFICATION AND CONSENT

Name

Qualification

8. MATERIAL ADVERSE CHANGE

9. LITIGATION

10. GENERAL

11. DOCUMENTS AVAILABLE FOR INSPECTION

APPENDIX II

CERTAIN CONTINUING CONNECTED TRANSACTIONS REQUIRING INDEPENDENT SHAREHOLDERS’ APPROVAL UNDER THE SHANGHAI LISTING RULES

I. SUMMARY OF THE TRANSACTIONS

1. Loan Services

(a) Pricing

CERTAIN CONTINUING CONNECTED TRANSACTIONS REQUIRING INDEPENDENT SHAREHOLDERS’ APPROVAL UNDER THE SHANGHAI LISTING RULES

2. Settlement Services and other financial services

(a) Pricing

II. REASONS AND BENEFITS FOR ENTERING INTO THE TRANSACTIONS

III. OPINIONS OF THE BOARD

Dalian Port (PDA) Company Limited[] 大連港股份有限公司*

NOTICE OF EXTRAORDINARY GENERAL MEETING

ORDINARY RESOLUTION

NOTICE OF EGM

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