Tonghua Dongbao Shareholders’ Meeting Rules of Procedure (June 2026)
Tonghua Dongbao Pharmaceutical Co., Ltd.
Rules of Procedure for Shareholders' Meeting
Chapter 1 General Provisions
Article 1 In order to regulate the organization and behavior of Tonghua Dongbao Pharmaceutical Co., Ltd. (hereinafter referred to as the "Company") and ensure that the shareholders' meeting exercises its powers in accordance with the law, these rules are formulated in accordance with the Company Law, the Securities Law, the Rules of Shareholders' Meetings of Listed Companies, the Stock Listing Rules of the Shanghai Stock Exchange, the Shanghai Stock Exchange Self-Discipline Supervision Guidelines for Listed Companies No. 1 - Standardized Operations, and other relevant laws, regulations and normative documents, as well as the relevant provisions of the company's articles of association, and in light of the actual situation of the company.
Article 2 The company shall convene shareholders' meetings in strict accordance with the relevant provisions of laws, administrative regulations, these rules and the company's articles of association to ensure that shareholders can exercise their rights in accordance with the law.
The company's board of directors should earnestly perform its duties and organize shareholders' meetings seriously and on time. All directors of the company should perform their duties diligently and ensure that shareholders’ meetings are held normally and their powers are exercised in accordance with the law.
Article 3 The shareholders’ meeting is the company’s authority and shall exercise the following powers in accordance with the law:
(1) Elect and replace directors, and decide on remuneration matters for directors;
(2) Review and approve the report of the board of directors;
(3) Review and approve the company’s profit distribution plan and loss compensation plan;
(4) Make a resolution to increase or decrease the company’s registered capital;
(5) Make a resolution on the issuance of corporate bonds;
(6) Make resolutions on the merger, division, dissolution, liquidation or change of company form;
(7) Modify the company’s articles of association;
(8) Make a resolution on the company’s hiring and dismissal of the accounting firm that handles the company’s audit business;
(9) Review and approve the guarantee matters specified in Article 45 of these Rules;
(10) Review the company’s purchase and sale of major assets within one year that exceed 30% of the company’s latest audited total assets;
(11) Review and approve changes in the use of raised funds;
(12) Review equity incentive plans and employee stock ownership plans;
(13) Review other matters that should be decided by the shareholders’ meeting as stipulated in laws, administrative regulations, departmental rules or company articles of association.
Article 4 Shareholders' meetings are divided into annual shareholders' meetings and extraordinary shareholders' meetings. The annual shareholders' meeting is held once a year and should be held within 6 months after the end of the previous fiscal year.
Article 5 If a temporary shareholders' meeting is held from time to time and any of the following circumstances occurs, the temporary shareholders' meeting shall be held within 2 months from the date of the fact:
(1) When the number of directors is less than two-thirds of the number stipulated in the Company Law or the company's articles of association;
(2) When the company’s uncompensated losses reach one-third of its total share capital;
(3) At the request of shareholders who individually or collectively hold more than 10% of the company's shares (including preference shares with restored voting rights, etc.);
(4) When the board of directors deems it necessary;
(5) When the audit committee proposes to convene;
(6) Other circumstances stipulated in laws, administrative regulations, departmental rules or company articles of association.
If the company is unable to convene a shareholders' meeting within the above period, it shall report to the dispatched office of the China Securities Regulatory Commission (hereinafter referred to as the "China Securities Regulatory Commission") where the company is located and the Shanghai Stock Exchange, explain the reasons and make an announcement.
Article 6 When a company convenes a shareholders' meeting, it shall hire a lawyer to issue legal opinions on the following issues and make an announcement:
(1) Whether the convening and convening procedures of the meeting comply with the provisions of laws, administrative regulations, the "Rules of Shareholders' Meetings of Listed Companies" and the company's articles of association;
(2) Whether the qualifications of the persons attending the meeting and the qualifications of the convener are legal and valid;
(3) Whether the voting procedures and voting results of the meeting are legal and valid;
(4) Legal opinions on other relevant issues at the request of the company.
Chapter 2 Convening of Shareholders’ Meeting
Article 7 The board of directors shall convene the shareholders’ meeting on time within the time limit specified in Articles 4 and 5 of these rules.
Article 8 With the consent of more than half of all independent directors, independent directors have the right to propose to the board of directors to convene an extraordinary shareholders' meeting. Regarding the independent directors' proposal to convene an extraordinary shareholders' meeting, the board of directors shall provide written feedback on whether it agrees or disagrees with convening an extraordinary shareholders' meeting within 10 days after receiving the proposal in accordance with the provisions of laws, administrative regulations and the company's articles of association.
If the board of directors agrees to convene an extraordinary shareholders' meeting, it shall issue a notice to convene the shareholders' meeting within 5 days after making the board resolution; if the board of directors does not agree to convene an extraordinary shareholders' meeting, it shall explain the reasons and make an announcement.
Article 9 When the audit committee proposes to the board of directors to convene an extraordinary shareholders' meeting, it shall submit the proposal to the board of directors in writing. The board of directors shall, in accordance with the provisions of laws, administrative regulations and the company's articles of association, provide written feedback on whether it agrees or disagrees with convening an extraordinary shareholders' meeting within 10 days after receiving the proposal.
If the board of directors agrees to convene an extraordinary shareholders' meeting, it shall issue a notice to convene the shareholders' meeting within 5 days after making the board resolution. Any changes to the original proposal in the notice must be approved by the audit committee.
If the board of directors does not agree to convene an extraordinary shareholders' meeting, or fails to provide written feedback within 10 days after receiving the proposal, it will be deemed that the board of directors is unable or fails to perform its duty to convene a shareholders' meeting, and the audit committee may convene and preside over it on its own.
Article 10 Shareholders who individually or collectively hold more than 10% of the company's shares (including preference shares with restored voting rights, etc.) request the board of directors to convene an extraordinary shareholders' meeting, and shall submit the request to the board of directors in writing.
The board of directors shall, in accordance with the provisions of laws, administrative regulations and the company's articles of association, provide written feedback on whether it agrees or disagrees with convening an extraordinary shareholders' meeting within 10 days after receiving the request.
If the board of directors agrees to convene an extraordinary shareholders' meeting, it shall issue a notice to convene the shareholders' meeting within 5 days after making the board of directors' resolution. Any changes to the original request in the notice must obtain the consent of the relevant shareholders.
If the board of directors does not agree to convene an extraordinary shareholders' meeting, or fails to provide feedback within 10 days after receiving the request, shareholders who individually or collectively hold more than 10% of the company's shares (including preferred shares with restored voting rights, etc.) have the right to propose to the audit committee to convene an extraordinary shareholders' meeting, and shall submit a request to the audit committee in writing. If the audit committee agrees to convene an extraordinary shareholders' meeting, it shall issue a notice to convene the shareholders' meeting within 5 days of receiving the request. Any changes to the original request in the notice must be approved by the relevant shareholders.
If the audit committee fails to issue a shareholders' meeting notice within the prescribed period, it will be deemed that the audit committee has not convened and presided over the shareholders' meeting. Shareholders who individually or collectively hold more than 10% of the company's shares (including preferred shares with restored voting rights, etc.) for more than 90 consecutive days may convene and preside over the meeting on their own.
Article 11 If the audit committee or shareholders decide to convene a shareholders' meeting on their own, they shall notify the board of directors in writing and file a record with the stock exchange.
The audit committee or the convening shareholders shall submit relevant supporting materials to the stock exchange when issuing the notice of the shareholders' meeting and publishing the announcement of the resolutions of the shareholders' meeting.
Before the resolution of the shareholders' meeting is announced, the proportion of shares held by the convening shareholders (including preferred shares with restored voting rights, etc.) shall not be less than 10%.
Article 12 The board of directors and the board secretary shall cooperate with the shareholders' meeting convened by the audit committee or shareholders themselves. The board of directors shall provide a list of shareholders on the equity registration date. If the board of directors fails to provide a list of shareholders, the convener may apply to the securities registration and clearing agency to obtain it with the relevant announcement of the notice of convening the shareholders' meeting. The shareholder list obtained by the convener shall not be used for any purpose other than convening a shareholders' meeting.
Article 13 For a shareholders' meeting convened by the audit committee or shareholders themselves, the necessary expenses for the meeting shall be borne by the company.
Chapter 3 Proposals and Notices of Shareholders’ Meeting
Article 14 The content of the proposal shall fall within the scope of the shareholders' meeting, have clear topics and specific resolution matters, and comply with the relevant provisions of laws, administrative regulations and the company's articles of association.
Article 15 When the company convenes a shareholders' meeting, the board of directors, audit committee and shareholders who individually or collectively hold more than 1% of the company's shares (including preference shares with restored voting rights, etc.) have the right to submit proposals to the company. Shareholders who individually or collectively hold more than 1% of the company's shares (including preference shares with restored voting rights, etc.) may submit a temporary proposal 10 days before the shareholders' meeting and submit it in writing to the convener. The convener shall issue a supplementary notice to the shareholders' meeting within 2 days after receiving the proposal, announce the contents of the temporary proposal, and submit the temporary proposal to the shareholders' meeting for review. Exceptions are made for temporary proposals that violate laws, administrative regulations or the company's articles of association, or do not fall within the scope of the shareholders' meeting. The company shall not increase the shareholding ratio of shareholders who submit temporary proposals.
Except as provided in the preceding paragraph, the convener shall not modify the proposals listed in the notice of shareholders' meeting or add new proposals after issuing the notice of shareholders' meeting.
Proposals that are not listed in the notice of the shareholders' meeting or do not comply with the provisions of Article 14 shall not be voted on and resolutions made by the shareholders' meeting.
Article 16 The convener shall notify all shareholders by announcement 20 days before the annual shareholders' meeting, and the extraordinary shareholders' meeting shall notify each shareholder by announcement 15 days before the meeting.
Article 17 The notice of shareholders’ meeting shall include the following contents:
(1) Time, place and duration of the meeting;
(2) Matters and proposals submitted to the meeting for consideration;
(3) Explain in clear words: All ordinary shareholders (including preference shareholders whose voting rights have been restored), shareholders holding special voting shares and other shareholders have the right to attend the shareholders' meeting, and may entrust a written proxy to attend the meeting and participate in voting. The shareholder's proxy does not have to be a shareholder of the company;
(4) Equity registration date of shareholders who have the right to attend the shareholders’ meeting;
(5) Name and telephone number of the permanent contact person for conference affairs;
(6) Voting time and voting procedures online or by other means.
Notices of shareholders' meetings and supplementary notices should fully and completely disclose the specific contents of all proposals, as well as all information or explanations required to enable shareholders to make reasonable judgments on the matters to be discussed. If the matters to be discussed require the independent directors to express their opinions, the opinions and reasons of the independent directors shall be disclosed at the same time when issuing the shareholders' meeting notice or supplementary notice.
Article 18 If the shareholders’ meeting intends to discuss the election of directors, the notice of the shareholders’ meeting shall fully disclose the detailed information of the director candidates, including at least the following:
(1) Educational background, work experience, part-time job and other personal information;
(2) Whether there is a related relationship with the company or the company’s controlling shareholder and actual controller;
(3) Number of company shares held;
(4) Whether you have been punished by the China Securities Regulatory Commission and other relevant departments or the stock exchange. Except for the cumulative voting system to elect directors, each director candidate shall be submitted as a separate proposal.
Article 19 The notice of shareholders' meeting shall specify the time and place of the meeting, and determine the equity registration date. The interval between the equity registration date and the meeting date should be no more than 7 working days. Once the equity registration date is confirmed, it cannot be changed.
Article 20 After the notice of the shareholders' meeting is issued, the shareholders' meeting shall not be postponed or canceled without justifiable reasons, and the proposals listed in the notice of the shareholders' meeting shall not be cancelled. In the event of postponement or cancellation, the convener shall issue an announcement at least 2 working days before the original meeting date to explain the specific reasons for the postponement or cancellation. If the shareholders' meeting is postponed, the postponed date must also be disclosed.
Chapter 4 Convening of Shareholders’ Meeting
Article 21 The place where the company convenes the shareholders' meeting shall be the company's domicile or other specific place notified by the convener of the shareholders' meeting.
The shareholders' meeting will set up a venue and be held in the form of an on-site meeting. The company will also provide the Internet or other means to facilitate shareholders. Shareholders who participate in the shareholders' meeting through the above methods are deemed to be present.
Shareholders can attend the shareholders' meeting in person and exercise their voting rights, or they can entrust others to attend on their behalf and exercise their voting rights within the scope of authorization.
Article 22 If a company's shareholders' meeting uses the Internet or other methods, the voting time and voting procedures for the Internet or other methods shall be clearly stated in the notice of the shareholders' meeting.
The start time of online or other voting methods at the shareholders' meeting shall not be earlier than 3:00 pm on the day before the on-site shareholders' meeting, and shall not be later than 9:30 am on the day of the on-site shareholders' meeting, and its end time shall not be earlier than 3:00 pm on the day when the on-site shareholders' meeting ends.
Article 23 The board of directors and other conveners shall take necessary measures to ensure the normal order of the shareholders' meeting. Measures should be taken to stop any behavior that interferes with shareholders' meetings, provokes troubles and infringes upon the legitimate rights and interests of shareholders, and promptly reports to relevant departments for investigation and punishment.
Article 24 All ordinary shares (including preference shareholders whose voting rights have been restored), shareholders holding shares with special voting rights and other shareholders or their agents registered on the equity registration date have the right to attend the shareholders' meeting and exercise voting rights in accordance with relevant laws, regulations and the company's articles of association. The company and the convener shall not refuse for any reason.
Article 25 If an individual shareholder attends a meeting in person, he or she shall present his/her identity card or other valid certificate or certificate that can indicate his/her identity; if an individual shareholder entrusts a proxy to attend the meeting, he/she shall present his or her valid identity card or shareholder's power of attorney.
Legal person shareholders shall be represented by their legal representative or an agent entrusted by the legal representative to attend the meeting. If the legal representative attends the meeting, he or she shall present his/her identity card and a valid certificate proving that he or she has the qualifications to be the legal representative; if an agent is appointed to attend the meeting, the agent shall present his/her identity card and a written authorization letter issued by the legal representative of the legal person shareholder unit in accordance with the law.
Article 26 The power of attorney issued by a shareholder to entrust others to attend the shareholders’ meeting shall specify the following contents:
(1) The name of the agent;
(2) The name of the client, the type and number of company shares held;
(3) Specific instructions from shareholders, including instructions to vote in favor, against or abstain from voting on each matter included in the agenda of the shareholders’ meeting;
(4) The date of issuance and validity period of the power of attorney;
(5) Signature (or seal) of the client. If the client is a legal person shareholder, the seal of the legal person entity shall be affixed.
Article 27 The power of attorney shall indicate whether the shareholder's agent can vote according to his or her own will if the shareholder does not give specific instructions.
Article 28 If the power of attorney for proxy voting is signed by another person authorized by the principal, the power of attorney or other authorization documents authorizing the signing shall be notarized. The notarized power of attorney or other authorization document, and the voting proxy form must be kept at the company's domicile or other place specified in the notice convening the meeting. If the principal is a legal person, its legal representative or a person authorized by resolution of the board of directors or other decision-making body shall attend the company's shareholders' meeting as a representative.
Article 29 The company is responsible for preparing the meeting register of persons attending the meeting. The meeting register shall contain the names (or names of units) of the participants, ID numbers, the number of shares held or represented with voting rights, the names of the principals (or names of units) and other matters.
Article 30 The convener and the lawyer hired by the company shall jointly verify the legality of shareholder qualifications based on the shareholder list provided by the securities registration and clearing agency, and register the names of shareholders and the number of voting shares they hold. Registration for the meeting shall be terminated before the host of the meeting announces the number of shareholders and proxies present at the meeting and the total number of shares with voting rights held.
Article 31 If the shareholders' meeting requires directors and senior managers to attend the meeting, the directors and senior managers shall attend the meeting and accept inquiries from shareholders.
Article 32 The shareholders’ meeting shall be chaired by the chairman of the board of directors. When the chairman of the board of directors is unable or fails to perform his duties, a director jointly elected by more than half of the directors shall preside over the meeting.
The shareholders' meeting convened by the audit committee shall be presided over by the convener of the audit committee. If the convener of the Audit Committee is unable or fails to perform his duties, an Audit Committee member jointly elected by more than half of the Audit Committee members shall preside over the meeting.
A shareholders' meeting convened by shareholders themselves shall be presided over by the convener or his elected representative.
When convening a shareholders' meeting, if the presiding officer of the meeting violates the rules of procedure and makes it impossible to continue the shareholders' meeting, with the consent of more than half of the shareholders with voting rights present at the shareholders' meeting, the shareholders' meeting may elect one person to serve as the presiding officer of the meeting and continue the meeting.
Article 33 At the annual shareholders' meeting, the board of directors shall make a report to the shareholders' meeting on its work over the past year, and each independent director shall also make a performance report.
Article 34 Directors and senior managers shall provide explanations and clarifications to shareholders’ inquiries at shareholders’ meetings.
Article 35 The host of the meeting shall announce the number of shareholders and agents attending the meeting on-site and the total number of shares with voting rights held before voting. The number of shareholders and agents attending the meeting on-site and the total number of shares with voting rights held shall be subject to the meeting registration.
Article 36 The secretary of the board of directors is responsible for the minutes of the shareholders’ meeting. The minutes of the meeting should record the following contents:
(1) Meeting time, location, agenda and name of the convener;
(2) The names of the host of the meeting and the directors and senior managers attending the meeting;
(3) The number of shareholders and proxies attending the meeting, the total number of shares with voting rights held and their proportion to the total number of shares of the company;
(4) The deliberation process, key points and voting results of each proposal;
(5) Shareholders’ inquiries or suggestions and corresponding replies or explanations;
(6) Names of lawyers, counters, and scrutineers;
(7) Other contents that should be included in the meeting minutes as stipulated in the company's articles of association.
Article 37 The convener shall ensure that the contents of the meeting minutes are true, accurate and complete. Directors, board secretaries, conveners or their representatives and meeting presiding officers who attend or attend the meeting shall sign on the meeting minutes. The minutes of the meeting shall be kept together with the signature books of the shareholders present on site, the power of attorney of the proxies, and the valid information on voting status via the Internet and other methods, and the retention period shall be no less than 10 years.
Article 38 The convener shall ensure that the shareholders’ meeting is held continuously until the final resolution is reached. If the shareholders' meeting is suspended or unable to make resolutions due to force majeure or other special reasons, necessary measures should be taken to resume the shareholders' meeting as soon as possible or directly terminate the shareholders' meeting, and make a timely announcement. At the same time, the convener should report to the local branch of the China Securities Regulatory Commission and the stock exchange where the company is located.
Chapter 5 Voting and Resolutions of the Shareholders’ Meeting
Article 39 The resolutions of the shareholders' meeting are divided into ordinary resolutions and special resolutions.
Ordinary resolutions made by the shareholders' meeting shall be passed by more than half of the voting rights held by the shareholders present at the shareholders' meeting. Special resolutions made by the shareholders' meeting must be passed by more than two-thirds of the voting rights held by shareholders attending the shareholders' meeting. The shareholders mentioned in this article include shareholders who entrust a proxy to attend the shareholders' meeting.
Article 40 The following matters shall be passed by ordinary resolutions at the shareholders’ meeting:
(1) Work report of the board of directors;
(2) The profit distribution plan and loss compensation plan drawn up by the board of directors;
(3) Appointment and removal of board members and their remuneration and payment methods;
(4) Other matters that should be passed by special resolutions except those stipulated by laws, administrative regulations or the company's articles of association.
Article 41 The following matters shall be passed by the shareholders' meeting through special resolutions:
(1) The company increases or decreases its registered capital;
(2) The division, spin-off, merger, dissolution and liquidation of the company;
(3) Modification of the company’s articles of association;
(4) The company purchases or sells major assets or provides guarantees to others for an amount exceeding 30% of the company’s latest audited total assets within one year;
(5) Equity incentive plan;
(6) Other matters that are stipulated in laws, administrative regulations or the company's articles of association, and that are determined by the shareholders' meeting to have a significant impact on the company through ordinary resolutions and need to be passed through special resolutions.
Article 42 Shareholders shall exercise their voting rights based on the number of voting shares they represent, and each share shall have one voting right. Except for class shareholders.
Shareholders who are related to matters to be considered at the shareholders' meeting shall abstain from voting, and the shares with voting rights held by them shall not be counted in the total number of shares with voting rights present at the shareholders' meeting.
When the shareholders' meeting considers major matters affecting the interests of small and medium-sized investors, the votes of small and medium-sized investors shall be counted separately. The results of individual vote counting should be disclosed to the public in a timely manner.
The company's shares held by the company have no voting rights, and such shares are not included in the total number of voting shares held by shareholders present.
If a shareholder purchases a company's voting shares in violation of the provisions of paragraphs 1 and 2 of Article 63 of the Securities Law, the shares exceeding the prescribed proportion may not exercise voting rights within thirty-six months after the purchase, and will not be included in the total number of voting shares for shareholders present.
The company's board of directors, independent directors, shareholders holding more than 1% of the voting shares, or investor protection institutions established in accordance with laws, administrative regulations or the provisions of the China Securities Regulatory Commission may publicly solicit shareholder voting rights. When soliciting shareholder voting rights, specific voting intentions and other information must be fully disclosed to the persons being solicited. It is prohibited to collect voting rights from shareholders through paid or disguised payment methods. Except for statutory conditions, a company may not impose minimum shareholding ratio restrictions on the solicitation of voting rights.
Article 43 If a company's transactions (except for providing guarantees, financial assistance, receiving cash assets as gifts, and simply reducing debts from the company's obligations) meet one of the following standards, in addition to being disclosed in a timely manner, they must also be submitted to the shareholders' meeting for review:
(1) The total assets involved in the transaction account for more than 50% of the company's latest audited total assets. If the total assets involved in the transaction have both book value and appraisal value, the higher one will be used as the calculation data;
(2) The net assets involved in the transaction target (such as equity) (if there are both book value and appraisal value, whichever is higher) account for more than 50% of the company's latest audited net assets, and the absolute amount exceeds 50 million yuan;
(3) The transaction amount (including debts and expenses assumed) accounts for more than 50% of the company’s latest audited net assets, and the absolute amount exceeds 50 million yuan;
(4) The profit generated from the transaction accounts for more than 50% of the company's audited net profit in the most recent fiscal year, and the absolute amount exceeds 5 million yuan;
(5) The operating income related to the transaction target (such as equity) in the most recent fiscal year accounts for more than 50% of the company’s audited operating income in the most recent fiscal year, and the absolute amount exceeds 50 million yuan;
(6) The net profit related to the transaction object (such as equity) in the most recent fiscal year accounts for more than 50% of the company's audited net profit in the most recent fiscal year, and the absolute amount exceeds 5 million yuan.
If the data involved in the above indicators are negative, the absolute value is used for calculation.
Article 44 If a company repurchases common shares through the public issuance of preferred shares for the purpose of reducing registered capital, and uses non-public issuance of preferred shares as a means of payment to repurchase common shares from specific shareholders of the company, the shareholders' meeting to make a resolution on the repurchase of common shares must be approved by more than two-thirds of the voting rights held by common shareholders (including preference shareholders whose voting rights have been restored) present at the meeting. The company shall announce the resolution on the day after the shareholders' meeting makes a resolution to repurchase ordinary shares.
Article 45 The following external guarantees provided by the company must be reviewed and approved by the shareholders’ meeting:
(1) A single guarantee amount exceeds 10% of the company’s latest audited net assets;
(2) Any guarantee provided after the total external guarantees of the company and its holding subsidiaries exceed 50% of the company’s latest audited net assets;
(3) Guarantees provided for guarantee objects whose asset-liability ratio exceeds 70%;
(4) The amount of guarantee provided by the company to others within one year exceeds 30% of the company’s latest audited total assets;
(5) Any guarantee provided after the company’s total external guarantee exceeds 30% of the latest audited total assets;
(6) Guarantees provided to shareholders, actual controllers and their related parties;
(7) Other external guarantees that must be reviewed and approved by the shareholders’ meeting in accordance with laws, administrative regulations and normative documents.
For guarantee matters within the scope of the authority of the board of directors, in addition to being approved by a majority of all directors, it must also be approved by more than two-thirds of the directors attending the board of directors meeting; the guarantee in item (4) of the preceding paragraph must be approved by more than two-thirds of the voting rights held by shareholders attending the meeting.
When the shareholders' meeting considers the guarantee proposal for shareholders, actual controllers and their related parties, the shareholder or the shareholders controlled by the actual controller shall not participate in the voting. The voting shall be passed by more than half of the voting rights held by other shareholders attending the shareholders' meeting.
Article 46 Any "financial assistance" transaction that occurs in a company must be reviewed and approved by more than half of all directors, and must also be reviewed and approved by more than two-thirds of the directors attending the board meeting, and disclosed in a timely manner.
If a financial assistance matter falls under any of the following circumstances, it shall also be submitted to the shareholders' meeting for review after being reviewed and approved by the board of directors:
(1) The amount of a single financial aid exceeds 10% of the company’s latest audited net assets;
(2) The latest financial statement data of the funded object shows that the asset-liability ratio exceeds 70%;
(3) The cumulative amount of financial assistance in the last 12 months exceeds 10% of the company’s latest audited net assets;
(4) Other circumstances stipulated by the Shanghai Stock Exchange or the company's articles of association.
If the funding object is a controlled subsidiary within the scope of the company's consolidated statements, and the other shareholders of the controlled subsidiary do not include the company's controlling shareholder, actual controller and its related parties, the provisions of the preceding two paragraphs may be exempted from application.
Article 47: When the shareholders' meeting considers relevant related transactions, related shareholders shall not participate in voting, and the number of shares with voting rights they represent shall not be included in the total number of valid votes; the announcement of the resolution of the shareholders' meeting shall fully disclose the voting status of non-related shareholders.
Article 48 Unless the company is in crisis or other special circumstances, the company will not enter into a contract with anyone other than directors or senior managers to hand over the management of all or important business of the company to that person unless approved by a special resolution of the shareholders' meeting.
Article 49 The list of director candidates shall be submitted to the shareholders' meeting for voting in the form of a proposal.
When the shareholders' meeting votes on the election of two or more directors (including independent directors), a cumulative voting system shall be implemented in accordance with the provisions of the company's articles of association or the resolution of the shareholders' meeting.
The cumulative voting system mentioned in the preceding paragraph means that when the shareholders' meeting elects directors, each share has the same voting rights as the number of directors to be elected, and the voting rights held by shareholders can be used collectively. The board of directors shall announce to shareholders the resume and basic information of candidate directors.
(1) Methods and procedures for nomination of directors and independent director candidates
Shareholders individually or jointly holding more than 1% of the company's shares may nominate and recommend director candidates to the board of directors in writing. After the board of directors conducts a qualification review, a written proposal will be submitted to the shareholders' meeting for election decision.
The board of directors may nominate and recommend company director candidates and independent director candidates, and formulate a written proposal in the form of a board of directors resolution and submit it to the shareholders' meeting for election decision.
Shareholders individually or jointly holding more than 1% of the issued shares of a listed company may propose candidates for independent directors, which shall be elected and decided by the shareholders' meeting.
Voting can only be conducted when the number of nominees for director candidates reaches the number specified in the company's articles of association. During the director election process, the opinions of small and medium-sized shareholders should be fully reflected.
(2) Matters related to the cumulative voting system:
- Principles for determining voting rights
(1) Each share held by shareholders attending the meeting has voting rights equal to the number of directors to be elected (including non-independent directors and independent directors).
(2) The product of the total number of voting shares represented by shareholders participating in the shareholders' meeting and the number of directors to be elected is the total number of valid voting rights.
- Calculation method of cumulative voting votes
(1) The product of the voting shares held by each shareholder multiplied by the number of directors to be elected at this shareholders’ meeting is the cumulative number of votes cast by this shareholder.
(2) When the shareholders' meeting conducts multiple rounds of elections, the cumulative votes of shareholders shall be recalculated based on the number of directors to be elected in each round of elections.
(3) The secretary of the company's board of directors shall announce the cumulative number of votes cast by each shareholder before each round of cumulative voting. If any shareholder, independent director of the company, scrutineer of the shareholders' meeting, or witnessing lawyer has any objection to the announced results, they shall immediately verify the results.
- Voting principles
(1) Non-independent directors and independent directors should be voted for separately.
(2) Shareholders can concentrate all the voting rights of their shares to one non-independent director or independent director candidate, or they can disperse their votes to several non-independent directors or independent director candidates.
(3) When electing non-independent directors, the maximum number of voting rights held by shareholders attending the meeting is equal to the total number of shares held by them multiplied by the number of non-independent directors to be elected at the shareholders’ meeting. This part of the voting rights can only be cast on the non-independent director candidates at the shareholders’ meeting.
When electing independent directors, the maximum number of voting rights held by shareholders attending the meeting is equal to the total number of shares they hold multiplied by the number of independent directors to be elected at the shareholders' meeting. This part of the voting rights can only be cast on the independent director candidates for the shareholders' meeting.
(4) When shareholders vote, they should indicate the number of voting rights used after each non-independent director or independent director they elect. This number must be a positive integer or zero. The number of votes cast for each non-independent director or independent director candidate may be higher or lower than the number of voting shares held by the non-independent director, and does not need to be an integral multiple of that number of shares.
(5) When shareholders vote for candidates for independent directors or non-independent directors, they shall vote within the maximum number of voting rights for the proposal group, and the cumulative number of votes cast shall not exceed the maximum number of voting rights they have for the proposal group.
- Principles for the election of non-independent directors and independent directors
(1) The candidates for non-independent directors or independent directors shall be elected in descending order according to the number of votes received, and the number of votes obtained by each candidate must exceed one-half of the total number of voting shares held by shareholders attending the shareholders' meeting (based on the number of unaccumulated shares), and when the number of candidates is equal to or less than the number of non-independent directors or independent directors to be elected, this part of non-independent directors or independent directors shall be elected.
(2) If the number of votes for two or more non-independent directors or independent director candidates is the same and the candidate cannot be decided, a separate shareholders' meeting shall be held to elect the candidates with the same number of votes.
(3) In the general election of the board of directors, if the number of elected directors is less than the number of directors to be elected, the following situations will apply:
If the number of directors elected at the shareholders' meeting does not exceed one-half of the number of directors to be elected, the original board of directors will continue to perform its duties. The company shall convene another shareholders' meeting within two months after the end of the shareholders' meeting to resubmit a new proposal and elect according to the number of directors who should be elected.
If the number of elected directors at the shareholders’ meeting exceeds one-half of the lower limit of the number of board members to be elected but is less than the number of candidates to be elected, a new board of directors will be established and the following situations will apply:
① If the number of elected directors is less than two-thirds of the number of board members specified in the Company Law or the company's articles of association, another shareholders' meeting shall be held within two months after the end of the shareholders' meeting to elect the vacant directors.
② If the number of elected directors at the shareholders' meeting is less than the number of directors to be elected, but the number of elected directors exceeds two-thirds of the number of board members stipulated in the company law or the company's articles of association, the vacancy will be filled at the next shareholders' meeting.
Article 50 Except for the cumulative voting system, all proposals at the shareholders' meeting shall be voted on item by item. If there are different proposals on the same matter, voting shall be carried out in the order in which the proposals were submitted. Unless the shareholders' meeting is suspended or unable to make a resolution due to special reasons such as force majeure, the shareholders' meeting shall not shelve the proposal or refuse to vote. When the shareholders' meeting deliberates on the issuance of preferred shares, it shall vote on the following matters item by item:
(1) The type and number of preferred shares issued this time;
(2) Issuance method, issuance objects and arrangements for allotment to original shareholders;
(3) Par amount, issuance price or pricing range and the principles for their determination;
(4) The ways for preference shareholders to participate in profit distribution, including: dividend rate and its determination principles, conditions for dividend issuance, dividend payment method, whether dividends are accumulated, whether they can participate in residual profit distribution, etc.;
(5) Repurchase terms, including the conditions, period, price and determination principles of the repurchase, the entity exercising the repurchase option, etc. (if any);
(6) Purpose of raised funds;
(7) A conditionally effective share subscription contract signed between the company and the corresponding issuance target;
(8) The validity period of the resolution;
(9) Amendments to the articles of association of the company regarding the profit distribution policy for preferred shareholders and ordinary shareholders;
(10) Authorization for the board of directors to handle specific matters related to this issuance;
(11) Other matters.
Article 51 When the shareholders' meeting considers the proposal, the proposal shall not be modified. If it is changed, it shall be regarded as a new proposal and shall not be voted on at the shareholders' meeting.
Article 52 The same voting right can only choose one of on-site, online or other voting methods. In the event of repeated voting for the same voting right, the result of the first vote shall prevail.
Article 53 Shareholders attending the shareholders' meeting shall express one of the following opinions on the proposals submitted for voting: agree, oppose or abstain from voting. The securities registration and clearing institution, as the nominal holder of the stock connect mechanism between the mainland and Hong Kong stock markets, shall not declare in accordance with the actual holder's wishes.
Votes that are not filled in, filled in incorrectly, with illegible handwriting or uncast votes will be deemed as the voter giving up the right to vote, and the voting result of the number of shares held by him shall be counted as "abstention".
Article 54 Before the shareholders' meeting votes on a proposal, two shareholder representatives shall be elected to participate in the counting and supervision of votes. If the matters under consideration are related to shareholders, relevant shareholders and agents are not allowed to participate in vote counting or voting supervision. When a shareholders' meeting votes on a proposal, lawyers and shareholder representatives shall be jointly responsible for counting and supervising the votes, and the voting results shall be announced on the spot. The voting results of the resolution shall be recorded in the meeting minutes.
Company shareholders or their agents who vote online or by other means have the right to check their voting results through the corresponding voting system.
Article 55 The on-site shareholders' meeting shall not end earlier than the online or other means. The host of the meeting shall announce the voting status and results of each proposal at the meeting site, and announce whether the proposal is passed or not based on the voting results.
Before the voting results are officially announced, the companies, vote counters, scrutineers, shareholders, network service providers and other relevant parties involved in the shareholders' meeting on-site, online and other voting methods have the obligation to keep the voting information confidential.
Article 56 If the presiding officer of the meeting has any doubts about the results of the resolutions submitted for voting, he may organize a count of the votes cast; if the presiding officer of the meeting does not conduct a count of the votes, and the shareholders or shareholders' agents present at the meeting have objections to the results announced by the presiding officer of the meeting, they have the right to request a counting of votes immediately after the voting results are announced, and the presiding officer of the meeting shall organize a counting of votes immediately.
Article 57 The resolutions of the shareholders' meeting shall be announced in a timely manner. The announcement shall list the number of shareholders and agents present at the meeting, the total number of voting shares held and their proportion to the total number of voting shares of the company, the voting method, the voting results of each proposal and the details of each resolution passed.
Article 58 If a proposal is not passed, or if this shareholders' meeting changes the resolution of the previous shareholders' meeting, a special reminder should be made in the announcement of the resolution of the shareholders' meeting.
Article 59: If the shareholders' meeting passes the proposal regarding the election of directors, the new directors shall take office in accordance with the provisions of the company's articles of association.
Article 60: If the shareholders' meeting passes a proposal on distributing cash, giving away shares, or transferring capital reserves to increase share capital, the company shall implement the specific plan within 2 months after the conclusion of the shareholders' meeting.
Article 61 The resolution of the company's shareholders' meeting shall be invalid if the content violates laws and administrative regulations.
The company's controlling shareholders and actual controllers shall not restrict or obstruct small and medium-sized investors from exercising their voting rights in accordance with the law, and shall not damage the legitimate rights and interests of the company and small and medium-sized investors.
If the convening procedures and voting methods of the shareholders' meeting violate laws, administrative regulations or the company's articles of association, or the content of the resolution violates the company's articles of association, shareholders may request the People's Court to revoke the resolution within 60 days from the date the resolution is made; however, this is excepted if the meeting convening procedures or voting methods of the shareholders' meeting have only minor flaws and do not have a substantial impact on the resolution.
Chapter 6 Supplementary Provisions
Article 62 The terms "above" and "within" mentioned in these rules include the original number; "over", "below" and "more than" do not include the original number.
Article 63 These rules shall take effect from the date of approval by the shareholders' meeting.
Article 64 Matters not covered in these rules shall be governed by the relevant national laws and regulations, normative documents and the company's articles of association. If these rules conflict with the provisions of the relevant national laws and regulations and the company's articles of association, the provisions of the relevant national laws and regulations or the company's articles of association shall be implemented.
Article 65 The company’s board of directors is responsible for interpreting these rules.
Tonghua Dongbao Pharmaceutical Co., Ltd.
June 2026