Harbin Pharmaceutical Group Co., Ltd. Foreign Investment Management System (September 2025)
Harbin Pharmaceutical Group Co., Ltd.
Foreign investment management system
Chapter 1 General Provisions
Article 1 In order to regulate the external investment behavior of Harbin Pharmaceutical Group Co., Ltd. (hereinafter referred to as the "Company"), establish a standardized, effective and scientific investment decision-making system and mechanism, reduce the risks of external investment, improve the efficiency of external investment, and ensure the preservation and appreciation of the company's assets, this system is formulated in accordance with the relevant laws, regulations, normative documents such as the Company Law of the People's Republic of China (hereinafter referred to as the "Company Law") and the Articles of Association of Harbin Pharmaceutical Group Co., Ltd. (hereinafter referred to as the "Articles of Association").
Article 2 External investment as referred to in this system refers to the economic behavior in which a company invests a certain amount of monetary funds, as well as physical objects such as houses, machines, equipment, and materials after asset appraisal, as well as intangible assets such as patent rights, technology, trademark rights, and land use rights, to invest in other units or projects outside the company in order to obtain future profits or achieve strategic goals.
Article 3 The company implements a hierarchical decision-making system among the shareholders’ meeting, the board of directors, and the president for its external investments. Subsidiary subsidiaries have no right to make decisions on external investments.
Article 4 Foreign investment shall follow the following principles:
(1) The company’s foreign investment behavior must comply with relevant national, provincial and municipal laws, regulations and industrial policies;
(2) The company's external investment behavior must be in line with the company's development strategy, be conducive to enhancing the company's competitiveness, be conducive to the rational allocation of corporate resources, create good economic benefits, and promote the company's sustainable development;
(3) The company's external investment behavior must adhere to the principle of giving priority to benefits and conduct feasibility studies and demonstrations to help improve the company's overall economic interests;
(4) The company’s external investment behavior must pay attention to investment risks and ensure the safe operation of funds.
Chapter 2 Overseas Investment Decision-making Authority
Article 5 Before a company plans to make an external investment, the business department that proposes the investment proposal, together with the financial management department and the board of directors office, shall be responsible for conducting feasibility studies and assessments of the external investment project according to their respective department responsibilities, and conducting investigations or on-site inspections of the credit status of the invested unit (if applicable).
Article 6 The company’s financial management department is responsible for the financial management of external investments. After the company's external investment project is determined, the company's financial management department is responsible for raising funds, cooperating with relevant parties to handle capital contribution procedures, industrial and commercial registration, tax registration, bank account opening, etc., and implementing strict borrowing, approval and payment procedures.
Article 7 The strategic operations department of the company shall conduct daily management of the company's long-term equity investments and shall have the function of supervising the company's external investment projects. Responsible for summarizing and collecting various resolutions, contracts, agreements, foreign investment equity certificates and other information formed during the investment process, and filing them together with the Financial Management Department for safekeeping. Responsible for establishing investment management ledgers and updating them in a timely manner.
Article 8 The Company’s Legal Affairs and Compliance Department and Audit and Supervision Department are responsible for the compliance review and audit of the Company’s external investment projects during and after implementation.
Article 9 The decision-making body for a company’s external investment is the shareholders’ meeting, the board of directors or the president. The company’s external investment authority is divided as follows:
(1) If the amount involved reaches more than 10% of the company’s latest audited net assets during the year, it must be reported to the shareholders’ meeting for review and approval;
(2) The cumulative amount involved during the year reaches more than 1% of the company’s latest audited net assets, and must be reported to the board of directors for review and approval;
(3) Any investment by a company in establishing a new subsidiary or the transfer of equity interests in a subsidiary must be submitted to the board of directors for review and approval;
(4) The president has decision-making power that does not exceed 1% of the company’s latest audited net assets in the current year. However, if the investment exceeds the scope of the company’s annual budget, it must be reported to the board of directors for review and approval;
(5) Related transactions with an external investment transaction amount of more than RMB 300,000 between the company and related natural persons or more than RMB 3 million with related legal persons and accounting for more than 0.5% of the company's latest audited net asset value; or although it is a related transaction that the president has the power to decide, but the board of directors, independent directors or the audit committee believe that it should be submitted to the board of directors for review and approval, it shall be submitted to the board of directors for review and approval;
The transaction amount between the company and related natural persons is more than 3 million yuan, or the transaction amount between the company and related legal persons is more than 30 million yuan and accounts for more than 5% of the company's latest audited net assets, which must be reported to the shareholders' meeting for review and approval;
(6) The chairman and president may authorize the chairman and president according to this system and the Articles of Association to perform corresponding decision-making procedures.
Article 10 When a company purchases or sells equity, the relevant financial indicators shall be calculated based on the proportion of changes in the equity of the target company held by the company, and the provisions of Article 9 of this system shall apply.
If the transaction will result in a change in the scope of the listed company's consolidated statements, the relevant financial indicators of the target company corresponding to the equity shall be used as the basis for calculation, and the provisions of Article 9 of this system shall apply.
Article 11 If the company’s external investment is a related party transaction, it shall be implemented in accordance with the company’s decision-making authority on related party transactions.
Chapter 3 Execution Control
Article 12 Before conducting various types of investments, companies should formulate detailed analysis materials including but not limited to project establishment reports, feasibility study reports, due diligence reports, investment return estimates, risk assessment plans and legal opinions to ensure the steady advancement and value realization of various investments.
Article 13 When determining an external investment plan, a company shall fully consider the project investment risks and expected investment returns, and select the optimal investment plan based on weighing the pros and cons of all aspects. When necessary, independent experts or intermediaries can be hired to form a review team to evaluate and consult on investment projects.
Article 14 The external investment project decided by the company shall specify the time, amount, method of investment, project leader, etc. Changes to the implementation plan of an overseas investment project must be approved by the original decision-making process.
Article 15 After an external investment project is approved, the authorized departments or personnel shall implement the external investment plan specifically, sign contracts and agreements with the invested units, and implement specific operational activities for property transfer. Before signing an investment contract or agreement, no investment funds shall be paid or investment assets transferred; after the investment is completed, an investment certificate or other valid certificate issued by the investee shall be obtained.
Article 16 If a company uses physical or intangible assets for external investment, its assets must be evaluated by an asset evaluation agency with relevant qualifications, and the evaluation results must be approved by the company's shareholders' meeting, board of directors resolution, or decision of the president before foreign investment can be made.
Article 17 For long-term equity investments, the company shall, according to needs and relevant regulations, dispatch equity representatives to the invested enterprises, such as shareholder representatives, directors, supervisors, financial directors or senior managers, in order to track and manage the investment projects, grasp the financial status and operating conditions of the invested units in a timely manner, and report any abnormal situations to the president in a timely manner and take corresponding measures.
Article 18 The company's financial management department shall strengthen the control of external investment income. Interest, dividends and other income obtained from external investment shall be included in the company's accounting system, and the establishment of off-book accounts is strictly prohibited.
Article 19 On the basis of setting up the external investment general ledger, the company's financial management department shall also set up external investment detailed accounts according to the type and time of the external investment business, and check the relevant investment accounts with the invested units regularly and irregularly to ensure the accuracy of the investment business records and the safety and integrity of the external investment.
Article 20 When conducting various types of overseas investment business, in addition to complying with the above terms, the company shall also abide by local laws and regulations, respect local cultural customs, and pay attention to environmental protection and the fulfillment of social responsibilities. At the same time, we formulate corresponding risk response plans based on the political, economic, and social environments of different countries and regions to ensure the compliance and safety of overseas investments.
Chapter 4 Investment Disposal
Article 21 The company may withdraw its external investment when one of the following circumstances occurs or occurs:
(1) According to the Articles of Association of the invested company, the operation period of the investment project expires;
(2) Due to poor management of the investment project, the company is unable to repay due debts and becomes bankrupt in accordance with the law;
(3) The project cannot continue to operate due to the occurrence of force majeure;
(4) When other circumstances stipulating the termination of investment appear or occur in the joint venture or cooperation contract.
Article 22 A company may transfer its external investment when one of the following circumstances occurs or occurs:
(1) The investment project has obviously deviated from the company’s business direction;
(2) The investment project has suffered continuous losses with no hope of turning around the losses and has no market prospects;
(3) When there is an urgent need to supplement funds due to insufficient operating funds;
(4) Other circumstances deemed necessary by the company.
Article 23 When a company's external investment project is terminated, a comprehensive inventory of the properties, claims, debts, etc. of the invested unit shall be carried out in accordance with the relevant national regulations on enterprise liquidation; during the liquidation process, attention shall be paid to whether there are any withdrawals and transfers of funds, private or disguised private division of assets, and arbitrary bonuses and subsidies; after the liquidation, whether all assets and creditor's rights have been recovered in a timely manner and the accounting procedures have been completed.
Article 24 When a company writes off an external investment, it shall obtain legal documents and certification documents stating that the investment cannot be recovered due to bankruptcy or other reasons.
Article 25 The company's financial management department shall carefully review the approval documents, meeting minutes, asset recovery lists and other relevant materials related to the disposal of external investment assets, and promptly conduct accounting treatments for the disposal of external investment assets in accordance with regulations to ensure that the asset disposal is true and legal.
Chapter 5 Tracking and Supervision
Article 26 The company should track and manage investment projects, understand the financial status and operating conditions of the invested units, organize investment quality analysis, and report any abnormal situations to the board of directors or its authorized personnel in a timely manner and take corresponding measures.
Article 27 The audit committee of the company's board of directors shall exercise the power of supervision and inspection of external investment activities. The contents of supervision and inspection mainly include:
(1) The establishment of positions and personnel related to investment business. Focus on checking whether there is a phenomenon where one person holds two or more incompatible positions at the same time;
(2) Implementation of the investment authorization and approval system. Focus on checking whether the authorization and approval procedures for foreign investment business are complete and whether there is any ultra vires approval behavior;
(3) Legality of the investment plan. Focus on checking whether there is illegal foreign investment;
(4) The custody of approval documents, contracts, agreements and other relevant legal documents for investment activities;
(5) Accounting of investment projects. Focus on checking whether the original vouchers are authentic, legal, accurate and complete, whether the accounting subjects are used correctly, and whether the accounting calculations are accurate and complete;
(6) Usage of investment funds. Focus on checking whether funds are used according to planned purposes and budgets, and whether there is any extravagance, waste, misappropriation, or misappropriation of funds during the use process;
(7) Custody of investment assets. Focus on checking whether there are any discrepancies between accounts and facts;
(8) Investment disposal status. Focus on checking whether the approval procedures for investment disposal are correct and whether the process is authentic and legal.
Article 28 The company will hold accountable those responsible for failure to perform external investment procedures as required, resulting in loss of company assets and other serious adverse consequences, in accordance with the company's "Measures for the Investigation and Management of Responsibilities for Illegal Operations and Investments".
Chapter 6 Supplementary Provisions
Article 29 Matters not covered by this system shall be implemented in accordance with the relevant provisions of national laws, regulations, normative documents and the Articles of Association. If this system is inconsistent with the relevant provisions of laws, regulations, other normative documents and the Articles of Association, the provisions of the relevant laws, regulations, other normative documents and the Articles of Association shall prevail.
Article 30 The external investment activities of subordinate enterprises shall be carried out in accordance with the provisions of their Articles of Association.
Article 31 The terms “above” and “within” in this system include the original number, and “exceed” and “lower than” do not include the original number.
Article 32 The company’s board of directors is responsible for interpreting this system.
Article 33 This system is drawn up by the company's board of directors and will come into effect and be implemented on the date it is reviewed and approved by the company's shareholders' meeting.
Board of Directors of Harbin Pharmaceutical Group Co., Ltd.
September 26, 2025