Articles of Association (January 2026)
Articles of Association of Thalys Medical Technology Group Co., Ltd.
January 2026
Directory
Chapter 1 General Provisions................................................................................................................................................3
Chapter 2 Business Purpose and Scope......................................................................................................................4
Chapter 3 Shares................................................................................................................................................................5
Section 1 Share Issuance................................................................................................................................................5
Section 2 Increase, decrease and repurchase of shares......................................................................................................6
Section 3 Share Transfer................................................................................................................................7
Chapter 4 Shareholders and Shareholders Meeting................................................................................................................8
Section 1 General Provisions for Shareholders................................................................................................................8
Section 2 Controlling Shareholders and Actual Controllers......................................................................................10
Section 3 General Provisions of Shareholders’ Meetings................................................................................................11
Section 4 Convening of Shareholders’ Meeting................................................................................................15
Section 5 Proposals and Notices of Shareholders’ Meetings......................................................................................16
Section 6 Convening of Shareholders’ Meeting.................................................................................................17
Section 7 Voting and Resolutions of the Shareholders’ Meeting................................................................................................20
Chapter 5 Directors and Board of Directors................................................................................................................23
Section 1 General Provisions for Directors................................................................................................23
Section 2 Board of Directors................................................................................................................................26
Section 3 Independent Directors................................................................................................................................31
Section 4 Special Committees of the Board of Directors................................................................................................33
Chapter 6 Senior Management................................................................................................................................35
Chapter 7 Financial Accounting System, Profit Distribution and Audit......................................................................37
Section 1 Financial Accounting System......................................................................................................................37
Section 2 Internal Audit......................................................................................................................40
Section 3 Appointment of Accounting Firm......................................................................................41
Chapter 8 Notices and Announcements................................................................................................................41
Section 1 Notice................................................................................................................................41
Section 2 Announcement......................................................................................................................................42
Chapter 9 Merger, spin-off, capital increase, capital reduction, dissolution and liquidation......................................................42
Section 1 Mergers, spin-offs, capital increases and capital reductions......................................................................42
Section 2 Dissolution and Liquidation......................................................................................................43
Chapter 10 Modification of the Articles of Association......................................................................................................................45
Chapter 11 Supplementary Provisions......................................................................................................................................46
Chapter 1 General Provisions
Article 1 In order to safeguard the legitimate rights and interests of the company, shareholders, employees and creditors, and regulate the organization and behavior of the company, these Articles of Association are formulated in accordance with the Company Law of the People's Republic of China (hereinafter referred to as the "Company Law"), the Securities Law of the People's Republic of China (hereinafter referred to as the "Securities Law") and other relevant regulations.
Article 2 The company is a joint-stock limited company (hereinafter referred to as the company) established in accordance with the Company Law and other relevant regulations.
The company was established by sponsorship; it was registered with the Administrative Approval Bureau of Dongxihu District, Wuhan City, and obtained a business license. The unified social credit code is 91420100758158557H.
Article 3 The company was approved by the China Securities Regulatory Commission (hereinafter referred to as the China Securities Regulatory Commission) on October 14, 2016, to issue 12,740,000 RMB ordinary shares to the public for the first time, and was listed on the Shanghai Stock Exchange on October 31, 2016.
Article 4 Company registered name: Thalys Medical Technology Group Co., Ltd.
English name: Thalys Medical Technology Group Corporation.
Article 5 Company address: No. 1310, Jinshan Avenue, Dongxihu District, Wuhan City; Postal code: 430000.
Article 6 The registered capital of the company is RMB 210,139,246.
Article 7 The company shall be a joint stock limited company with permanent existence.
Article 8 The chairman of the board of directors is the legal representative of the company.
If the chairman of the board of directors resigns, he shall be deemed to have resigned as the legal representative at the same time.
If the legal representative resigns, the company will determine a new legal representative within 30 days from the date of resignation.
Article 9 The legal consequences of civil activities conducted by the legal representative in the name of the company shall be borne by the company.
The restrictions on the powers of the legal representative in this Articles of Association or the shareholders' meeting shall not antagonize bona fide counterparties.
If the legal representative causes damage to others due to the performance of his duties, the company shall bear civil liability. After the company assumes civil liability, it may recover compensation from the at-fault legal representative in accordance with the provisions of the law or these Articles of Association.
Article 10 Shareholders shall bear liability for the company to the extent of the shares they subscribe for, and the company shall bear liability for the company's debts with all of its property.
Article 11 From the effective date of this Articles of Association, it will become a legally binding document that regulates the organization and behavior of the company, the rights and obligations between the company and shareholders, and between shareholders, and is a legally binding document for the company, shareholders, directors, and senior managers.
According to this Article of Association, shareholders can sue shareholders, shareholders can sue company directors and senior managers, shareholders can sue the company, and companies can sue shareholders, directors and senior managers.
Article 12 The term "senior management personnel" as mentioned in these Articles of Association refers to the company's manager (president, the same below), deputy manager (vice president, the same below), financial director (financial director, the same below), board secretary and other personnel specified in these Articles of Association.
Article 13 The company shall establish Communist Party organizations and carry out Party activities in accordance with the provisions of the Constitution of the Communist Party of China. The company provides necessary conditions for the activities of party organizations.
Chapter 2 Business Purpose and Scope
Article 14 The company's business purpose: In line with the desire to strengthen economic cooperation and technological exchanges, adopt advanced and applicable technology and scientific management methods, actively research, develop and produce marketable products for domestic and foreign markets, provide efficient, convenient and high-quality services, meet the society's growing material and cultural life needs, improve the economic benefits of the enterprise, and enable investors to obtain satisfactory returns on investment.
Article 15 Registered in accordance with the law, the company's business scope is: General items: sales of Class I medical devices, leasing of Class I medical devices, sales of Class II medical devices, leasing of Class II medical devices, maintenance of electronic and mechanical equipment (excluding special equipment), repair of special equipment, leasing services (excluding licensed leasing services), sales of special chemical products (excluding hazardous Chemicals), sales of chemical products (excluding licensed chemical products), sales of experimental analytical instruments, sales of plastic products, Internet sales (except sales of goods requiring licenses), food sales (only sales of prepackaged food), food Internet sales (only sales of prepackaged food), daily necessities wholesale, daily necessities sales, health food (prepackaged) sales, Sales of sanitary products and disposable medical products, sales of personal hygiene products, software sales, wholesale of cosmetics, retail of cosmetics, sales of formula foods for special medical purposes, sales of daily chemical products, software development, network and information security software development, technical services, technology development, technical consultation, technology exchange, technology transfer, technology promotion, computing Wholesale of machine software, hardware and auxiliary equipment, information technology consulting services, information system integration services, Internet of Things technology research and development, information system operation and maintenance services, supply chain management services, domestic cargo transportation agency, international cargo transportation agency, general cargo warehousing services (excluding dangerous chemicals and other items requiring license approval), cargo import and export, technology import and export. (Except for licensed businesses, you can independently operate projects that are not prohibited or restricted by laws and regulations in accordance with the law)
Licensed items: Category III medical device operation, Category III medical equipment leasing, pharmaceutical wholesale, medical device Internet information services, pharmaceutical Internet information services, road cargo transportation (excluding dangerous goods). (Projects that require approval according to law can only be carried out with the approval of relevant departments. Specific business projects shall be subject to the approval documents or licenses of relevant departments)
Chapter 3 Shares
Section 1 Share Issuance
Article 16 The company's shares shall be in the form of stocks.
Article 17 All shares issued by the company are ordinary shares. The issuance of company shares shall be based on the principles of openness, fairness and impartiality, and each share of the same category shall have equal rights. For shares of the same type issued at the same time, the issuance conditions and price per share are the same; for shares subscribed by subscribers, the same price is paid per share.
Article 18 The par value of the par value shares issued by the company shall be expressed in RMB, with a par value of one yuan per share.
Article 19 The shares issued by the company shall be centrally deposited at the Shanghai Branch of China Securities Depository and Clearing Co., Ltd.
Article 20 The total number of promoter shares of the company is 38 million shares. The company's sponsors include Tianjin Ruimei Scientific Instrument Co., Ltd., SPILLO LIMITED, Shanghai Heruizhong Investment Management Co., Ltd., Suqian Tianmu Junhe Investment Management Center (Limited Partnership), Chuanhua Holding Group Co., Ltd., Nanjing Weilan Equity Investment Enterprise (Limited Partnership), Xiamen Siming District Zhaofeng Equity Investment Partnership (Limited Partnership), and Haikou Linmu Technology Co., Ltd. The shares and quantities subscribed by each promoter of the company are as follows:
No. Name of sponsor Number of shares held (shares) Shareholding ratio 1 Tianjin Ruimei Scientific Instrument Co., Ltd. 23,480,998 61.7921% 2 SPILLO LIMITED 1,852,500 4.8750% 3 Shanghai Heruizhong Investment Management Co., Ltd. 1,480,518 3.8961% 4 Suqian Tianmu Junhe Investment Management Center (Limited Partnership) 3,000,290 7.8955% 5 Chuanhua Holding Group Co., Ltd. 3,000,290 7.8955% 6 Nanjing Weilan Equity Investment Enterprise (Limited Partnership) 2,470,000 6.5000% 7 Xiamen Siming District Zhaofeng Equity Investment Partnership (Limited Partnership) 2,161,250 5.6875% 8 Haikou Linmu Technology Co., Ltd. 554,154 1.4583% Total 38,000,000 100.0000%
Article 21 The total number of shares of the company is 210,139,246 shares, and the company’s capital structure is: 210,139,246 ordinary shares.
Article 22 The company or its subsidiaries (including its affiliated enterprises) shall not provide financial assistance for others to obtain shares of the company or its parent company in the form of gifts, advances, guarantees, loans, etc., unless the company implements an employee stock ownership plan.
For the benefit of the company, upon resolution of the shareholders' meeting, or the board of directors making a resolution in accordance with the Articles of Association or the authorization of the shareholders' meeting, the company may provide financial assistance to others or the shares of its parent company, but the cumulative total of financial assistance shall not exceed 10% of the total issued share capital. Resolutions made by the board of directors must be approved by more than two-thirds of all directors.
Section 2 Increase, decrease and repurchase of shares
Article 23 Based on the needs of operation and development, in accordance with the provisions of laws and regulations, and upon resolution of the shareholders' meeting, the company may increase capital in the following ways:
(1) Issuance of shares to unspecified objects;
(2) Issuance of shares to specific objects;
(3) Distribute bonus shares to existing shareholders;
(4) Convert public reserve funds into share capital;
(5) Other methods prescribed by laws, administrative regulations and the China Securities Regulatory Commission.
When a company issues convertible corporate bonds, the issuance, conversion procedures and arrangements of convertible corporate bonds, and changes in the company's share capital resulting from the conversion shall be handled in accordance with relevant laws, administrative regulations, provisions of the China Securities Regulatory Commission, stock exchange business rules, and the company's convertible corporate bond prospectus.
Article 24 A company may reduce its registered capital. When a company reduces its registered capital, it shall do so in accordance with the Company Law and other relevant regulations and the procedures stipulated in these Articles of Association.
Article 25 A company may not acquire its own shares. However, except for one of the following circumstances:
(1) Reduce the company’s registered capital;
(2) Merge with other companies that hold shares of the company;
(3) Use shares for employee stock ownership plans or equity incentives;
(4) A shareholder requests the company to acquire his or her shares because he or she dissents from the company's merger or division resolution made by the shareholders' meeting;
(5) Use the shares to convert corporate bonds issued by the company that can be converted into stocks;
(6) Necessary for the company to maintain the company's value and shareholders' rights and interests.
Article 26 A company may acquire its own shares through public centralized transactions or other methods recognized by laws, administrative regulations and the China Securities Regulatory Commission.
If a company acquires its own shares due to the circumstances stipulated in Items (3), (5) and (6) of Paragraph 1 of Article 25 of this Article, it shall do so through public centralized transactions.
Article 27 If the company acquires the company's shares due to the circumstances stipulated in Items (1) and (2) of Paragraph 1 of Article 25 of this Article, it shall be resolved by the shareholders' meeting; if the company acquires its shares due to the circumstances stipulated in Items (3), (5) and (6) of Article 25 of Paragraph 1 of this Article, it may, in accordance with the provisions of these Articles or with the authorization of the shareholders' meeting, pass a resolution at a board meeting attended by more than two-thirds of the directors.
After the company acquires the company's shares in accordance with the provisions of paragraph 1 of Article 25 of the Articles, if it falls under the circumstances of item (1), it shall cancel it within 10 days from the date of acquisition; if it falls under the circumstances of items (2) and (4), it shall transfer or cancel it within 6 months; if it falls under the circumstances of items (3), (5), and (6), the total number of shares of the company held by the company shall not exceed 10% of the total number of issued shares of the company, and shall be canceled within 3 Transfer or cancel within the year.
When a company acquires its own shares, it must fulfill its information disclosure obligations in accordance with the provisions of the Securities Law.
Section 3 Share Transfer
Article 28 The company's shares shall be transferred in accordance with the law.
Article 29 The company does not accept its own shares as the subject of pledge.
Article 30 The shares issued before the company's public issuance of shares shall not be transferred within one year from the date the company's shares are listed and traded on the stock exchange.
Directors and senior managers of a company shall report to the company the shares they hold in the company and their changes. The shares transferred each year during the term of office determined at the time of taking office shall not exceed 25% of the total number of shares of the same category held by them in the company; the shares held by the company shall not be transferred within 1 year from the date the company's stocks are listed and traded. The above-mentioned personnel shall not transfer the shares of the company held by them within six months after their resignation.
If the company's directors and senior managers directly hold shares in the company that change due to the company's equity distribution, etc., they should still comply with the above regulations.
Article 31 If directors, senior managers, or shareholders holding more than 5% of the company's shares sell the company's stocks or other equity securities they hold within 6 months after buying them, or buy them again within 6 months after selling, the proceeds will belong to the company, and the company's board of directors will take back the proceeds. However, securities companies holding more than 5% of the shares due to underwriting the purchase of remaining stocks after the sale are excluded, as well as other circumstances stipulated by the China Securities Regulatory Commission.
The stocks or other securities with an equity nature held by directors, senior managers, and natural person shareholders as mentioned in the preceding paragraph include stocks or other securities with an equity nature held by their spouses, parents, and children and those held using the accounts of others.
If the company's board of directors fails to implement the provisions of paragraph 1 of this article, shareholders have the right to request the board of directors to implement it within 30 days. If the company's board of directors fails to implement the decision within the above time limit, shareholders have the right to file a lawsuit directly with the People's Court in their own name for the benefit of the company.
If the company's board of directors fails to comply with the provisions of paragraph 1 of this article, the responsible directors shall bear joint and several liability in accordance with the law.
Chapter 4 Shareholders and Shareholders’ Meeting
Section 1 General Provisions for Shareholders
Article 32 The company shall establish a shareholder list based on the certificates provided by the securities registration and clearing agency. The shareholder list is sufficient evidence to prove that shareholders hold the company's shares. Shareholders enjoy rights and assume obligations according to the class of shares they hold; shareholders holding the same class of shares enjoy the same rights and assume the same obligations.
Article 33 When a company convenes a shareholders' meeting, distributes dividends, liquidates, or engages in other actions that require confirmation of the identity of shareholders, the board of directors or the convener of the shareholders' meeting shall determine the equity registration date. The shareholders who are registered after the market closes on the equity registration date shall be shareholders who enjoy relevant rights and interests.
Article 34 Shareholders of the company enjoy the following rights:
(1) Receive dividends and other forms of benefit distribution based on the share of shares held;
(2) Request, convene, convene, host, participate or appoint shareholders’ agents to participate in shareholders’ meetings in accordance with the law, and exercise corresponding voting rights;
(3) Supervise the company’s operations and make suggestions or inquiries;
(4) Transfer, donate or pledge the shares it holds in accordance with the provisions of laws, administrative regulations and these Articles of Association;
(5) Check and copy the company's articles of association, shareholder list, corporate bond stubs, shareholders' meeting minutes, board meeting resolutions, and financial accounting reports. Shareholders who meet the regulations may check the company's accounting books and accounting vouchers;
(6) When the company is terminated or liquidated, participate in the distribution of the company's remaining property according to the share of shares it holds;
(7) Shareholders who object to the company merger or division resolution made by the shareholders' meeting require the company to acquire their shares;
(8) Other rights stipulated in laws, administrative regulations, departmental rules or this Charter.
Article 35 Shareholders who request to review or copy company-related materials must comply with the provisions of the Company Law, Securities Law and other laws and administrative regulations. If a shareholder requests to review or copy relevant materials of the company, he or she shall provide the company with written documents proving the type and number of shares held by the company, and the company will provide it according to the shareholder's request after verifying the shareholder's identity.
Article 36 If the resolutions of the company’s shareholders’ meeting or board of directors violate laws and administrative regulations, shareholders have the right to request the People’s Court to invalidate the resolutions.
If the convening procedures and voting methods of the shareholders' meeting or the board of directors violate laws, administrative regulations or the Articles of Association, or the content of the resolution violates the Articles of Association, shareholders have the right to request the People's Court to revoke the resolution within 60 days from the date the resolution is made. However, there are only minor flaws in the convening procedures or voting methods of shareholders' meetings and board of directors meetings, except those that have no substantial impact on the resolutions.
If the board of directors, shareholders and other relevant parties have disputes over the validity of the resolutions of the shareholders' meeting, they should promptly file a lawsuit with the people's court. Before the people's court makes a judgment or ruling such as revoking the resolution, the relevant parties shall implement the resolution of the shareholders' meeting. The company, directors and senior managers should effectively perform their duties and ensure the normal operation of the company.
If the people's court makes a judgment or ruling on relevant matters, the company shall perform its information disclosure obligations in accordance with laws, administrative regulations, the provisions of the China Securities Regulatory Commission and the stock exchange, fully explain the impact, and actively cooperate with the implementation after the judgment or ruling takes effect. If it involves the correction of previous matters, it will be handled in a timely manner and the corresponding information disclosure obligations will be fulfilled.
Article 37 If any of the following circumstances occurs, the resolution of the company’s shareholders’ meeting or board of directors will be invalid:
(1) No shareholders’ meeting was convened and no resolution was made by the board of directors;
(2) The shareholders’ meeting and the board of directors’ meeting did not vote on resolution matters;
(3) The number of people attending the meeting or the number of voting rights held does not reach the number or number of voting rights stipulated in the Company Law or these Articles of Association;
(4) The number of people or the number of voting rights they hold who agree to the resolution does not reach the number of people or the number of voting rights they hold as stipulated in the Company Law or the Articles of Association.
Article 38 If directors or senior managers other than members of the audit committee violate laws, administrative regulations or the provisions of these Articles of Association when performing their duties and cause losses to the company, shareholders who individually or collectively hold more than 1% of the company's shares for more than 180 consecutive days have the right to request the audit committee to file a lawsuit in the People's Court in writing; if members of the audit committee violate laws, administrative regulations or the provisions of these Articles of Association when performing their duties and cause losses to the company, shareholders may request the board of directors in writing to file a lawsuit in the People's Court.
If the audit committee or the board of directors refuses to initiate a lawsuit after receiving a written request from a shareholder as stipulated in the preceding paragraph, or fails to initiate a lawsuit within 30 days from the date of receipt of the request, or the situation is urgent and failure to initiate a lawsuit immediately will cause irreparable damage to the company's interests, the shareholders stipulated in the preceding paragraph have the right to directly file a lawsuit with the People's Court in their own name for the benefit of the company.
If others infringe upon the company's legitimate rights and interests and cause losses to the company, the shareholders specified in the first paragraph of this article may file a lawsuit with the People's Court in accordance with the provisions of the previous two paragraphs.
If directors, supervisors or senior managers of a company's wholly-owned subsidiaries violate laws, administrative regulations or the provisions of these Articles of Association when performing their duties, causing losses to the company, or if others infringe upon the legitimate rights and interests of the company's wholly-owned subsidiaries and cause losses, shareholders who individually or collectively hold more than 1% of the company's shares for more than 180 consecutive days may request in writing the supervisory board or board of directors of the wholly-owned subsidiary to file a lawsuit with the People's Court in accordance with the first three paragraphs of Article 189 of the "Company Law" or directly file a lawsuit with the People's Court in their own name.
If a company's wholly-owned subsidiary does not have a board of supervisors or supervisors, but has an audit committee, the provisions of paragraphs 1 and 2 of this article shall apply.
Article 39 If directors or senior managers violate laws, administrative regulations or the provisions of these Articles of Association and harm the interests of shareholders, shareholders may file a lawsuit in the People's Court.
Article 40 Shareholders of the company shall bear the following obligations:
(1) Comply with laws, administrative regulations and this charter;
(2) Pay the share price according to the shares subscribed and the method of subscription;
(3) Except under circumstances stipulated by laws and regulations, its share capital shall not be withdrawn;
(4) Shall not abuse the rights of shareholders to harm the interests of the company or other shareholders; must not abuse the independent status of a company as a legal person and the limited liability of shareholders to harm the interests of the company’s creditors;
(5) Other obligations stipulated in laws, administrative regulations and this Articles of Association.
Article 41 If a company shareholder abuses his shareholder rights and causes losses to the company or other shareholders, he shall be liable for compensation in accordance with the law. If a company's shareholders abuse the company's independent status as a legal person and the limited liability of shareholders, evade debts and seriously damage the interests of the company's creditors, they shall bear joint and several liability for the company's debts.
Section 2 Controlling Shareholders and Actual Controllers
Article 42 The controlling shareholders and actual controllers of a company shall exercise their rights and perform their obligations in accordance with laws, administrative regulations, provisions of the China Securities Regulatory Commission and stock exchanges, and safeguard the interests of listed companies.
Article 43 The company’s controlling shareholders and actual controllers shall comply with the following provisions:
(1) Exercise shareholders’ rights in accordance with the law, and do not abuse control rights or use related relationships to damage the legitimate rights and interests of the company or other shareholders;
(2) Strictly implement the public statements and commitments made, and shall not make any changes or exemptions without authorization;
(3) Perform information disclosure obligations in strict accordance with relevant regulations, actively cooperate with the company in information disclosure, and promptly inform the company of major events that have occurred or are expected to occur;
(4) Company funds shall not be appropriated in any way;
(5) The company and relevant personnel shall not be forced, instigated or required to provide guarantees in violation of laws and regulations;
(6) Not to use the company's undisclosed major information to seek benefits, not to leak any undisclosed major information related to the company in any way, and not to engage in insider trading, short-term trading, market manipulation and other illegal activities;
(7) The legitimate rights and interests of the company and other shareholders shall not be harmed through unfair related transactions, profit distribution, asset restructuring, external investment, etc. in any way;
(8) Ensure the company’s asset integrity, personnel independence, financial independence, organizational independence and business independence, and shall not affect the company’s independence in any way;
(9) Other provisions of laws, administrative regulations, regulations of the China Securities Regulatory Commission, business rules of stock exchanges and these Articles of Association.
If the company's controlling shareholder or actual controller does not serve as a director of the company but actually performs the company's affairs, the provisions of this Articles of Association regarding directors' duties of loyalty and diligence shall apply.
If a company's controlling shareholder or actual controller instructs a director or senior manager to engage in behavior that damages the interests of the company or shareholders, he shall be jointly and severally liable with the director or senior manager.
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.
Article 44 If a controlling shareholder or actual controller pledges the company's stocks held or actually controlled by him or her, the company's control rights and production and operation stability shall be maintained.
Article 45 When controlling shareholders and actual controllers transfer the shares of the company they hold, they must comply with the restrictive provisions on share transfers and the commitments made to restrict share transfers in laws, administrative regulations, regulations of the China Securities Regulatory Commission and stock exchanges.
Section 3 General Provisions of Shareholders’ Meetings
Article 46 The company’s shareholders’ meeting shall be composed of all shareholders. The shareholders' meeting is the company's authority and exercises 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 this 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 stipulated in Article 47 of these Articles of Association;
(10) Review the company’s purchase and sale of major assets within one year exceeding 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 these Articles of Association.
The shareholders' meeting can authorize the board of directors to make a resolution on the issuance of corporate bonds.
The specific authority of the shareholders’ meeting to review relevant matters is as follows:
- If the company's transactions (except for the provision of financial assistance and guarantees) meet one of the following standards, they shall be submitted to the shareholders' meeting for review after being reviewed and approved by the board of directors:
(1) The total assets involved in the transaction (if there are both book value and appraisal value, whichever is higher) account for more than 50% of the company’s latest audited total assets;
(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.
If a company's transactions occur under any of the following circumstances, they are exempted from submission to the shareholders' meeting for review in accordance with the foregoing provisions, but the company must still perform its information disclosure obligations in accordance with the provisions of these Articles of Association:
(1) The company receives cash assets as gifts, obtains debt relief, and other transactions that do not involve payment of consideration or any obligations;
(2) The transactions of the company only meet the standards of item (4) or (6) of the aforementioned provisions, and the absolute value of the company's earnings per share in the most recent fiscal year is less than 0.05 yuan.
- If the company's "financial assistance" transaction 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 assistance 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) Stock exchanges or other circumstances stipulated in these Articles of Association.
If the funding object is a holding subsidiary within the scope of the company's consolidated statements, and the other shareholders of the holding subsidiary do not include the company's controlling shareholder, actual controller and their related persons, the aforementioned provisions may be exempted.
The company shall not provide financial assistance to related parties, except when it provides financial assistance to a related joint-stock company that is not controlled by the company's controlling shareholder or actual controller, and other shareholders of the joint-stock company provide financial assistance under the same conditions in proportion to their capital contribution. If the company provides financial assistance to the above-mentioned related-shareholding companies, it shall not only be reviewed and approved by more than half of all non-related directors, but also must be reviewed and approved by more than 2/3 of the non-related directors attending the board meeting, and submitted to the shareholders' meeting for review.
If the company's "provision of guarantee" transaction falls within one of the circumstances in Article 47 of the Articles of Association, it shall be submitted to the shareholders' meeting for review after being reviewed and approved by the board of directors.
If the transaction amount (including debts and expenses assumed) between the company and its related parties exceeds 30 million yuan and accounts for more than 5% of the absolute value of the company's latest audited net assets, the audit report or evaluation report (except for daily related transactions) shall be disclosed in accordance with regulations, and the transaction shall be submitted to the shareholders' meeting for review.
Article 47 The following external guarantees provided by the company must be reviewed and approved by the shareholders’ meeting.
(1) Any guarantee provided after the total amount of external guarantees provided by the company and its controlled subsidiaries exceeds 50% of the company’s latest audited net assets;
(2) Any guarantee provided after the total amount of external guarantees provided by the company and its controlled subsidiaries exceeds 30% of the company’s latest audited total assets;
(3) A guarantee that exceeds 30% of the company’s latest audited total assets based on the cumulative calculation principle of the guarantee amount within 12 consecutive months;
(4) Guarantees provided for guarantee objects whose asset-liability ratio exceeds 70%;
(5) A single guarantee amount exceeds 10% of the company’s latest audited net assets;
(6) Guarantees provided to shareholders, actual controllers and their related parties;
(7) Other guarantees stipulated by the Shanghai Stock Exchange or the company's articles of association.
When the shareholders' meeting considers the guarantee in item (3) of the preceding paragraph, it shall be approved by more than 2/3 of the voting rights held by shareholders attending the meeting.
If the company provides guarantees to related parties, in addition to the deliberation and approval of a majority of all non-related directors, it must also be reviewed and approved by more than 2/3 of the non-related directors attending the board meeting and a resolution must be made, and submitted to the shareholders' meeting for review. If the company provides guarantees for the controlling shareholder, actual controller and their related persons, the controlling shareholder, actual controller and their related persons shall provide counter-guarantee. If the company causes the guaranteed party to become a related person of the company due to a transaction or related transaction, when implementing the transaction or related transaction, it shall perform corresponding review procedures and information disclosure obligations with respect to the existing related guarantee. If the board of directors or shareholders' meeting fails to review and approve the aforementioned related-party guarantee matters, the parties to the transaction shall take effective measures such as early termination of the guarantee.
Article 48 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. Extraordinary shareholders' meetings are held from time to time, and this Articles of Association
When an extraordinary shareholders' meeting is required to be convened under the circumstances specified in Article 49, the extraordinary shareholders' meeting shall be convened within 2 months.
If the company is unable to convene a shareholders' meeting within the above period, it shall report to the branch office of the China Securities Regulatory Commission and the stock exchange, explain the reasons and make an announcement.
Article 49 If any of the following circumstances occurs, the company shall convene an extraordinary shareholders' meeting within two months from the date of occurrence:
(1) When the number of directors is less than 6;
(2) When the company’s uncompensated losses reach 1/3 of its total share capital;
(3) When requested by shareholders individually or collectively holding more than 10% of the company’s shares;
(4) When the board of directors deems it necessary;
(5) When the audit committee proposes to convene;
(6) Other situations stipulated in laws, administrative regulations, departmental rules or this Article.
Article 50 The place where the company convenes the shareholders' meeting is the company's domicile or other place specified in the notice of convening the shareholders' meeting. The shareholders' meeting will set up a venue and be held in the form of an on-site meeting. In addition to setting up a meeting venue and holding it in person, the shareholders' meeting can also be held using electronic communication methods. The company will also provide online voting to facilitate shareholders' participation in the shareholders' meeting.
The time and location of the on-site meeting should be chosen to facilitate shareholders' participation. After the notice of the shareholders' meeting is issued, the location of the on-site shareholders' meeting shall not be changed without justifiable reasons. If changes are indeed necessary, the convener shall announce and explain the reasons at least 2 working days before the on-site meeting.
Article 51 When convening a shareholders' meeting, the company will 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, and these 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.
Section 4: Convening of Shareholders’ Meeting
Article 52 The board of directors shall convene the shareholders’ meeting on time within the prescribed time limit.
With the approval of more than half of all independent directors, the 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 these Articles of Association. If the board of directors agrees to convene an extraordinary shareholders' meeting, it will 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 will explain the reasons and make an announcement.
Article 53 If 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 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 these Articles of Association.
The board of directors agrees to convene an extraordinary shareholders' meeting and will issue a notice to convene the shareholders' meeting within 5 days after making the board's 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 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 54 Shareholders who individually or collectively hold more than 10% of the company's shares have the right to 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 these 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 resolution. Any changes to the original request in the notice must be approved by 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 individually or collectively holding more than 10% of the company's shares 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 for more than 90 consecutive days may convene and preside over it on their own.
Article 55 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 shareholder shall submit relevant supporting materials to the stock exchange when issuing the notice of the shareholders' meeting and the announcement of the resolutions of the shareholders' meeting.
Before the resolution of the shareholders' meeting is announced, the shareholding ratio of the convening shareholders shall not be less than 10%.
Article 56 The board of directors and the board secretary will cooperate with the shareholders' meeting convened by the audit committee or shareholders themselves.
The board of directors will provide a shareholder register on the record 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 57 For a shareholders' meeting convened by the audit committee or shareholders themselves, the necessary expenses for the meeting shall be borne by the company.
Section 5 Proposals and Notices of Shareholders’ Meetings
Article 58 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 these Articles of Association.
Article 59 When a company convenes a shareholders' meeting, the board of directors, audit committee and shareholders individually or collectively holding more than 1% of the company's shares have the right to submit proposals to the company.
Shareholders who individually or collectively hold more than 1% of the company's shares may put forward 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 for the circumstances specified 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 these Articles of Association shall not be voted on and resolutions made by the shareholders' meeting.
Article 60 The convener will notify shareholders by announcement 20 days before the annual shareholders' meeting (excluding the day of the meeting), and the extraordinary shareholders' meeting will notify shareholders by announcement 15 days before the meeting (excluding the day of the meeting).
Article 61 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 obvious words: All ordinary shareholders have the right to attend the shareholders’ meeting and may appoint a proxy in writing to attend the meeting and participate in voting. The shareholder’s proxy does not need 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 shall fully and completely disclose all 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.
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.
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 62 If the shareholders’ meeting intends to discuss the election of directors, the shareholders’ meeting notice will 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 its 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 63 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 make an announcement and explain the reasons at least 2 working days before the original date.
Section 6 Convening of Shareholders’ Meeting
Article 64 The company's board of directors and other conveners will take necessary measures to ensure the normal order of the shareholders' meeting. Measures will be taken to stop any behavior that interferes with shareholders' meetings, provokes troubles and infringes upon the legitimate rights and interests of shareholders, and will be reported to relevant departments for investigation and punishment in a timely manner.
Article 65 All ordinary 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 these Articles of Association.
Shareholders may attend the shareholders' meeting in person or entrust a proxy to attend and vote on their behalf.
Article 66 If an individual shareholder attends a meeting in person, he or she shall present his or her ID card or other valid certificate or certificate that can indicate his or her identity; if he or she attends the meeting on behalf of another person, he or she shall present his or her valid ID card or a 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 that proves his or her qualifications as a legal representative; if an agent attends the meeting, the agent shall present his/her identity card and a written power of attorney issued by the legal representative of the legal person shareholder unit in accordance with the law.
Article 67 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 client, the type and number of company shares held;
(2) The name of the agent;
(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 68 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.
Article 69 The company is responsible for preparing a meeting register of attendees. 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 70 The convener and the lawyer hired by the company will 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 shares with voting rights 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 71 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 72 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. When 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 73 The company shall formulate rules of procedure for shareholders' meetings, specifying in detail the convening, convening and voting procedures of shareholders' meetings, including notification, registration, review of proposals, voting, counting of votes, announcement of voting results, formation of meeting resolutions, meeting minutes and their signing, announcements, etc., as well as the principles for authorization of the board of directors of shareholders' meetings, and the authorization content shall be clear and specific. The rules of procedure of the shareholders' meeting shall be attached to the articles of association and shall be drawn up by the board of directors and approved by the shareholders' meeting.
Article 74 At the annual shareholders' meeting, the board of directors shall make a report to the shareholders' meeting on its work over the past year. Each independent director should also make a performance report.
Article 75 Directors and senior managers shall provide explanations and explanations to shareholders’ inquiries and suggestions at shareholders’ meetings.
Article 76 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 77 The shareholders' meeting shall have meeting minutes, which shall be held by the secretary of the board of directors.
The minutes of the meeting record the following:
(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 this charter.
Article 78 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 79 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.
Section 7 Voting and Resolutions of Shareholders’ Meeting
Article 80 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 shall be passed by more than 2/3 of the voting rights held by the shareholders present at the shareholders' meeting.
Article 81 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 these Articles of Association.
Article 82 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 this 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 these 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 83 Shareholders shall exercise their voting rights based on the number of voting shares they represent, and each share shall have one voting right.
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 the 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 shall not exercise voting rights within 36 months after the purchase, and will not be included in the total number of shares with voting rights for shareholders present.
The company's board of directors, independent directors, shareholders holding more than 1% of 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 84 When the shareholders' meeting considers relevant related transactions, related shareholders shall not participate in voting, nor may they exercise voting rights on behalf of other shareholders. The number of shares with voting rights they represent shall not be counted 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.
The related shareholders mentioned in the preceding paragraph include the following shareholders or shareholders with one of the following circumstances:
(1) Be the counterparty;
(2) Having direct or indirect control over the counterparty;
(3) Directly or indirectly controlled by the counterparty;
(4) Directly or indirectly controlled by the same legal person or other organization or natural person as the counterparty;
(5) Working for the counterparty to the transaction, or for a legal entity that can directly or indirectly control the counterparty, or a legal entity directly or indirectly controlled by the counterparty;
(6) A close family member of the transaction counterparty or its direct or indirect controller;
(7) Shareholders whose voting rights are restricted and affected due to the existence of unfulfilled equity transfer agreements or other agreements with the counterparty or its related parties;
(8) Shareholders identified by the China Securities Regulatory Commission or the exchange as likely to cause the listed company to tilt its interests.
Article 85 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 entrust the management of all or important business of the company to that person without approval by a special resolution of the shareholders' meeting.
Article 86 The list of director candidates shall be submitted to the shareholders' meeting for voting in the form of a proposal.
The nomination methods and procedures for directors are:
(1) The board of directors and shareholders individually or jointly holding more than 3% of the company’s shares may nominate director candidates;
(2) The board of directors and shareholders individually or jointly holding more than 1% of the company's shares may nominate candidates for independent directors. Investor protection agencies established in accordance with the law may publicly request shareholders to entrust them with the right to nominate independent directors on their behalf;
(3) When shareholders nominate directors or independent directors, they shall submit the nomination proposal, details of the nominated candidate, and the candidate's statement or commitment to the board of directors 10 days before the shareholders' meeting.
When the shareholders' meeting votes on the election of directors, the cumulative voting system may be implemented in accordance with the provisions of these Articles of Association or the resolution of the shareholders' meeting. Companies in which a single shareholder and persons acting in concert own 30% or more of the shares and companies that elect more than two independent directors shall adopt a cumulative voting system.
If the shareholders' meeting elects directors by cumulative voting, the voting of independent directors and non-independent directors shall be conducted separately, and the elected directors shall be determined in descending order of the number of electoral votes received based on the number of directors to be elected. If cumulative voting is not adopted to elect directors, each director candidate shall be submitted as a separate proposal.
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 specific rules for the company's implementation of the cumulative voting system can be found in the company's "Cumulative Voting Implementation Rules".
Article 87 In addition to the cumulative voting system, the shareholders' meeting will vote on all proposals one by one. If there are different proposals on the same matter, they will vote in the order in which the proposals are submitted. Unless the shareholders' meeting is suspended or unable to make a resolution due to special reasons such as force majeure, the shareholders' meeting will not shelve proposals or refrain from voting.
Article 88 When the shareholders' meeting considers the proposal, the proposal will not be modified. If it is changed, it shall be regarded as a new proposal and cannot be voted on at this shareholders' meeting.
Article 89 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 90 The shareholders' meeting shall vote by registered vote.
Article 91 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.
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 92 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, and declare whether the proposal is passed 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 93 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 shall be counted as "abstention".
Shareholders or their agents may not vote in favor of mutually exclusive proposals at the same time at the shareholders' meeting.
Article 94 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 95 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 shares with voting rights held and their proportion to the total number of shares with voting rights of the company, the voting method, the voting results of each proposal and the details of each resolution passed.
Article 96 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 resolution of the shareholders' meeting.
Article 97 If the shareholders' meeting passes the relevant proposal for the election of directors, unless otherwise provided in the resolution of the shareholders' meeting, the new director shall take office immediately after the conclusion of the shareholders' meeting.
Article 98 If the shareholders' meeting passes the proposal on distributing cash, giving away shares, or transferring capital reserves to increase share capital, the company will implement the specific plan within 2 months after the conclusion of the shareholders' meeting.
Chapter 5 Directors and Board of Directors
Section 1 General Provisions for Directors
Article 99 A director of a company is a natural person and cannot serve as a director of the company under any of the following circumstances:
(1) Having no capacity for civil conduct or having limited capacity for civil conduct;
(2) If a person is sentenced to a criminal penalty for corruption, bribery, misappropriation of property, misappropriation of property or undermining the order of the socialist market economy, or is deprived of political rights due to a crime, and the execution period has not expired for 5 years, and if he is sentenced to probation, 2 years have not passed since the expiration of the probation period;
(3) Serving as a director or factory director or manager of a company or enterprise undergoing bankruptcy liquidation, and being personally responsible for the bankruptcy of the company or enterprise, less than 3 years have elapsed since the date of completion of the bankruptcy liquidation of the company or enterprise;
(4) Serving as the legal representative of a company or enterprise that has had its business license revoked or ordered to close due to illegal activities, and bearing personal responsibility, and it has not been more than 3 years since the company or enterprise was revoked of its business license or ordered to close;
(5) A large amount of personal debt has not been paid off when due and is listed as a dishonest person subject to execution by the people's court;
(6) Being banned from the securities market by the China Securities Regulatory Commission and the time limit has not expired;
(7) Being publicly determined by the stock exchange to be unfit to serve as a director or senior manager of a listed company, etc., and the time limit has not expired;
(8) Other contents stipulated in laws, administrative regulations or departmental rules.
If a director is elected or appointed in violation of the provisions of this article, the election, appointment or appointment shall be invalid. If any of the circumstances specified in this article occurs during the term of office of a director, the company shall remove him from office and stop him from performing his duties.
Article 100 Directors shall be elected or replaced by the shareholders' meeting, and may be removed from their posts by the shareholders' meeting before the expiration of their term of office. Directors have a three-year term and may be re-elected upon expiration of their term.
The term of office of a director shall be calculated from the date of taking office until the expiration of the term of the current board of directors. If a director's term of office expires and is not re-elected in time, until the re-elected director takes office, the original director shall still perform his duties as a director in accordance with the provisions of laws, administrative regulations, departmental rules and these Articles of Association.
Directors may concurrently serve as senior managers, but the total number of directors who concurrently serve as senior managers shall not exceed 1/2 of the total number of directors of the company. The company shall have one employee representative director.
Except for the general election, the number of directors that the company can replace and re-elect every year shall be at most 1/3 of the total number of directors, except when the number of directors is insufficient due to the resignation of a director and the number of directors is insufficient as specified in the Articles of Association or the law and a by-election is required. Article 101 Directors shall abide by laws, administrative regulations and the provisions of these Articles of Association, have a duty of loyalty to the company, take measures to avoid conflicts between their own interests and the interests of the company, and shall not use their powers to seek improper benefits. Directors have the following duties of loyalty to the company:
(1) Not to misappropriate the company’s property or misappropriate company funds;
(2) Company funds shall not be stored in accounts opened in his or her own name or in the names of other individuals;
(3) No bribery or other illegal income may be taken advantage of;
(4) Without reporting to the board of directors or the shareholders' meeting, and passing the resolution of the board of directors or the shareholders' meeting in accordance with the provisions of these Articles, no contract or transaction may be made directly or indirectly with the company;
(5) No one shall take advantage of his or her position to seek business opportunities belonging to the company for himself or others, unless the report is reported to the board of directors or the shareholders' meeting and passed by the shareholders' meeting, or the company is unable to take advantage of the business opportunities in accordance with laws, administrative regulations or the provisions of these articles of association;
(6) Without reporting to the board of directors or the shareholders' meeting and passing the resolution of the shareholders' meeting, they are not allowed to operate business similar to that of the company for themselves or for others;
(7) You shall not accept commissions from other people’s transactions with the company and keep them as your own;
(8) Company secrets shall not be disclosed without authorization;
(9) Shall not use its affiliated relationships to harm the interests of the company;
(10) Other loyalty obligations stipulated in laws, administrative regulations, departmental rules and this Articles of Association.
The income earned by directors in violation of the provisions of this article shall belong to the company; if they cause losses to the company, they shall bear liability for compensation.
The provisions of Item (4) of Paragraph 2 of this Article shall apply when close relatives of directors and senior managers, enterprises directly or indirectly controlled by directors, senior managers or their close relatives, and related persons who have other related relationships with directors and senior managers, enter into contracts or conduct transactions with the company.
Article 102 Directors shall abide by the provisions of laws, administrative regulations and these Articles of Association, have a duty of diligence to the company, and shall exercise the reasonable care normally due to managers in performing their duties for the best interests of the company.
Directors have the following diligence obligations towards the company:
(1) The rights granted by the company should be exercised prudently, conscientiously and diligently to ensure that the company’s commercial activities comply with the requirements of national laws, administrative regulations and various national economic policies, and that commercial activities do not exceed the business scope stipulated in the business license;
(2) All shareholders should be treated fairly;
(3) Keep abreast of the company’s business operations and management status;
(4) Written confirmation opinions should be signed on the company’s periodic reports. Ensure that the information disclosed by the company is true, accurate and complete;
(5) Relevant information and information shall be truthfully provided to the Audit Committee and shall not hinder the Audit Committee from exercising its powers;
(6) Ensure that you have enough time and energy to participate in company affairs. In principle, you should attend the board of directors in person. If you are unable to attend the board of directors in person for some reason, you should carefully select the trustee. The authorized matters and decision-making intentions should be specific and clear, and no carte blanche is allowed;
(7) Other diligence obligations stipulated in laws, administrative regulations, departmental rules and this Articles of Association.
Article 103 If a director fails to attend two consecutive board meetings in person or entrusts other directors to attend board meetings, he shall be deemed to be unable to perform his duties, and the board of directors shall recommend his removal to the shareholders' meeting.
Article 104 Directors may resign before the expiration of their term of office. Directors who resign shall submit a written resignation report to the company, and the resignation will take effect on the date the company receives the resignation report. The company will disclose the relevant situation within 2 trading days. If the number of members on the company's board of directors falls below the legal minimum due to the resignation of a director, the resignation of an independent director results in the proportion of independent directors on the company's board of directors or its special committees not complying with laws, regulations or the provisions of these articles of association, or there is a lack of accounting professionals among independent directors, before the re-elected directors take office, the original directors shall still perform their duties as directors in accordance with laws, administrative regulations, departmental rules and the provisions of these articles of association.
Article 105 The company shall establish a director resignation management system and clarify the safeguard measures for accountability and compensation for unfulfilled public commitments and other unfulfilled matters. When a director's resignation takes effect or his term expires, he must complete all transfer procedures to the board of directors. His duty of loyalty to the company and shareholders will not be automatically terminated after the end of his term, and will remain valid for one year after the end of his term. The responsibilities that a director shall bear due to the performance of his duties during his term of office shall not be relieved or terminated upon resignation.
Article 106 The shareholders' meeting may resolve to dismiss a director, and the dismissal shall be effective on the date the resolution is made.
If a director is dismissed before the expiration of his term without justifiable reasons, the director may request the company to compensate him.
Article 107 No director may act in his or her own name on behalf of the company or the board of directors without the provisions of these articles of association or the legal authorization of the board of directors. When a director acts in his own name, if a third party would reasonably believe that the director is acting on behalf of the company or the board of directors, the director shall state his position and identity in advance.
Article 108 If a director causes damage to others when performing company duties, the company will be liable for compensation; if a director commits intentional or gross negligence, he shall also be liable for compensation.
If a director violates laws, administrative regulations, departmental rules or the provisions of these Articles of Association when performing his duties and causes losses to the company, he shall be liable for compensation.
Section 2 Board of Directors
Article 109 The company shall have a board of directors, which shall consist of nine directors, including three independent directors and one employee representative director. The board of directors shall have one chairman, who shall be elected by a majority of all directors.
Article 110 The board of directors shall exercise the following powers:
(1) Convene a shareholders’ meeting and report work to the shareholders’ meeting;
(2) Implement the resolutions of the shareholders’ meeting;
(3) Decide on the company’s business plan and investment plan;
(4) Formulate the company’s profit distribution plan and loss compensation plan;
(5) Formulate plans for the company to increase or reduce its registered capital, issue bonds or other securities, and go public;
(6) Formulate plans for the company’s major acquisitions, acquisition of the company’s stocks, or mergers, divisions, dissolutions, and changes to the company’s form;
(7) Decide on matters such as the company’s external investment, acquisition and sale of assets, asset mortgages, external guarantees, entrusted financial management, related transactions, external donations, etc. within the scope authorized by the shareholders’ meeting;
(8) Decide on the establishment of the company’s internal management organization;
(9) Decide on the appointment or dismissal of company managers, board secretaries and other senior managers, and decide on their remuneration, rewards and punishments;
(10) Formulate the company’s basic management system;
(11) Formulate amendment plans to this Articles of Association;
(12) Management company information disclosure matters;
(13) Propose to the shareholders’ meeting to hire or change the accounting firm to audit the company;
(14) Listen to the company manager’s work report and inspect the manager’s work;
(15) Other powers granted by laws, administrative regulations, departmental rules, these Articles of Association or the shareholders' meeting. Matters beyond the scope of authorization of the shareholders' meeting shall be submitted to the shareholders' meeting for review.
Article 111 The company's board of directors shall explain to the shareholders' meeting the non-standard audit opinions issued by certified public accountants on the company's financial report.
Article 112 The Board of Directors formulates the rules of procedure of the Board of Directors to ensure that the Board of Directors implements the resolutions of the shareholders' meeting, improves work efficiency, and ensures scientific decision-making. The rules of procedure of the board of directors stipulate the convening and voting procedures of the board of directors. As an attachment to the articles of association, the rules of procedure of the board of directors are drafted by the board of directors and approved by the shareholders' meeting.
Article 113 The board of directors shall determine the authority for external investment, acquisition and sale of assets, asset mortgages, external guarantees, entrusted financial management, related transactions, external donations, etc., and establish strict review and decision-making procedures; major investment projects shall organize relevant experts and professionals to conduct reviews and submit them to the shareholders' meeting for approval.
The specific authority of the board of directors to review relevant matters is as follows:
- If the company's transactions (except for the provision of financial assistance and guarantees) meet one of the following standards, it shall be disclosed in a timely manner after review and approval by the board of directors:
(1) The total assets involved in the transaction (if there are both book value and appraisal value, whichever is higher) account for more than 10% of the company’s latest audited total assets;
(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 10% of the company's latest audited net assets, and the absolute amount exceeds 10 million yuan; (3) The transaction amount (including debts and expenses assumed) accounts for more than 10% of the company's latest audited net assets, and the absolute amount exceeds 10 million yuan;
(4) The profit generated from the transaction accounts for more than 10% of the company’s audited net profit in the most recent fiscal year, and the absolute amount exceeds 1 million yuan;
(5) The main business income related to the transaction object (such as equity) in the most recent fiscal year accounts for more than 10% of the company's audited main business income in the most recent fiscal year, and the absolute amount exceeds 10 million yuan; (6) The net profit related to the transaction object (such as equity) in the most recent accounting year accounts for more than 10% of the company's audited net profit in the most recent fiscal year, and the absolute amount exceeds 1 million yuan.
If the data involved in the above indicators are negative, their absolute values will be used for calculation.
- Any "financial assistance" transaction that occurs in the company must be reviewed and approved by more than half of all directors, and must also be reviewed and approved by more than 2/3 of the directors attending the board meeting, and disclosed in a timely manner.
If the funding object is a holding subsidiary within the scope of the company's consolidated statements, and the other shareholders of the holding subsidiary do not include the company's controlling shareholder, actual controller and their related persons, the aforementioned provisions may be exempted.
Any "guarantee provision" transaction that occurs in the company must be reviewed and approved by more than half of all directors, and must also be reviewed and approved by more than 2/3 of the directors attending the board meeting, and disclosed in a timely manner.
If the company signs a contract related to daily transactions and meets one of the following standards, it shall be disclosed in a timely manner after review and approval by the board of directors:
(1) The company purchases raw materials, fuel and power, accepts labor services, etc., and the contract amount accounts for more than 50% of the company’s latest audited total assets, and the absolute amount exceeds 500 million yuan;
(2) The company has sales of products or commodities, provision of labor services, project contracting, etc., and the contract amount accounts for more than 50% of the company's audited main business income in the most recent fiscal year, and the absolute amount exceeds 500 million yuan;
(3) Other contracts that the company or the stock exchange believes may have a significant impact on the company's financial status and operating results.
- If a transaction between the company and a related party meets one of the following standards, it shall be submitted to the board of directors for review and approval with the consent of more than half of all independent directors and then disclosed in a timely manner:
(1) The transaction amount (including debts and expenses borne) with a related natural person is more than 300,000 yuan;
(2) Transactions with related legal persons (or other organizations) with a transaction amount (including debts and expenses assumed) of more than 3 million yuan, and accounting for more than 0.5% of the absolute value of the company's latest audited net assets.
- The company's transactions or matters that do not meet the aforementioned standards shall be reviewed by the board of directors under the authorization of the chairman of the board; the company's transactions or matters that exceed the aforementioned standards shall be reviewed and approved by the board of directors and submitted to the shareholders' meeting for review in accordance with the provisions of these Articles of Association.
Article 114 When the company's board of directors considers related party transactions, related directors shall abstain from voting and shall not exercise voting rights on behalf of other directors. The board meeting can be held if more than half of the non-related directors are present, and resolutions made at the board meeting must be passed by more than half of the non-related directors. If the number of non-related directors present at the board meeting is less than 3, the company shall submit the transaction to the shareholders' meeting for review.
The related directors mentioned in the preceding paragraph include the following directors or directors with one of the following circumstances:
(1) Be the counterparty;
(2) Having direct or indirect control over the counterparty;
(3) Served in the counterparty of the transaction, or in a legal person or other organization that can directly or indirectly control the counterparty, or a legal person or other organization directly or indirectly controlled by the counterparty;
(4) Close family members who are the counterparty to the transaction or its direct or indirect controller;
(5) Close family members of directors or senior managers who are the counterparty to the transaction or its direct or indirect controller;
(6) Directors whose independent business judgment may be affected as determined by the China Securities Regulatory Commission, the stock exchange or the company based on the principle of substance over form.
Article 115 The chairman of the board of directors shall exercise the following powers:
(1) Preside over shareholders’ meetings and convene and preside over board meetings;
(2) Supervise and inspect the implementation of board resolutions;
(3) Other powers granted by the board of directors.
Article 116 The board of directors shall hold at least two meetings every year, convened by the chairman of the board of directors, and all directors shall be notified in writing 10 days before the meeting.
Article 117 Shareholders representing more than 1/10 of the voting rights, more than 1/3 of the directors or the audit committee may propose to convene an extraordinary meeting of the board of directors. The chairman of the board of directors shall convene and preside over a board meeting within 10 days after receiving the proposal.
Article 118 The board of directors shall notify the extraordinary board meeting by email or fax. If conditions permit, written notice may also be delivered by hand. The notification time limit shall be: at least 5 days before the meeting. If the situation is urgent and it is necessary to convene an extraordinary meeting of the board of directors as soon as possible, the meeting notice may be issued at any time by telephone or other oral means, but the convener shall make an explanation at the meeting.
Article 119 The notice of board meeting shall include the following contents:
(1) Meeting date and location
(2) Meeting period;
(3) Reasons and issues;
(4) The date of issuing the notice;
Article 120 A board meeting can only be held if more than half of the directors are present. Resolutions made by the board of directors must be approved by more than half of all directors. When there is an equal number of votes for and against (or abstention), the resolution will be deemed to have not been passed. The board of directors should modify the relevant matters based on the review results and submit them to the next board of directors for review. The board of directors should vote on it again. If the number of votes is still equal, the board of directors may propose to submit it to the shareholders' meeting for review and voting.
The voting on resolutions of the board of directors shall be based on one person, one vote.
Article 121 If a director has an affiliated relationship with an enterprise or individual involved in matters resolved at a board meeting, the director shall promptly report in writing to the board of directors. Directors with related relationships may not exercise voting rights on this resolution, nor may they exercise voting rights on behalf of other directors. The board meeting can be held if more than half of the unrelated directors are present, and resolutions made at the board meeting must be passed by more than half of the unrelated directors. If the number of unrelated directors attending the board meeting is less than 3, the matter shall be submitted to the shareholders' meeting for review.
Article 122 The board of directors shall convene meetings and vote by means of registered voting, voting by show of hands, or voting by fax, email, or telephone. If faxes, emails, or phone calls are used, the company should save the corresponding faxes, emails, and phone recordings for a period of 10 years.
On the premise of ensuring that directors can fully express their opinions, extraordinary meetings of the board of directors can be held by telephone conference, video conference, email or fax, and resolutions can be made and signed by the participating directors.
Article 123 Board meetings shall be attended by the director in person. If a director is unable to attend for any reason, he may authorize another director in writing to attend on his behalf. The letter of authorization shall state the name of the agent, matters of agency, scope of authorization and validity period, and shall be signed or sealed by the principal. Directors attending meetings on their behalf shall exercise their rights within the scope of authorization. If a director fails to attend a board meeting or appoint a representative to attend, he shall be deemed to have given up his right to vote at the meeting.
A director may not accept the proxy of more than 2 directors to attend the meeting on his or her behalf at a single board meeting. Independent directors may not entrust non-independent directors to attend meetings on their behalf. When voting matters are involved, the principal shall clearly state in the letter of authorization whether he agrees, opposes or abstains from voting on each matter. Directors shall not make or accept entrustments without voting intention, full powers or entrustments with unclear scope of authorization. When reviewing related party transactions, non-related directors shall not entrust related directors to attend the meeting on their behalf.
Article 124 The board of directors shall make minutes of its decisions on the matters discussed at the meeting, and the directors attending the meeting shall sign on the minutes.
The minutes of board of directors meetings shall be kept as company files and shall be kept for no less than 10 years.
Article 125 The minutes of board meetings shall include the following contents:
(1) The date, place and name of the convener of the meeting;
(2) The names of directors present and the names of directors (agents) entrusted by others to attend the board of directors;
(3) Meeting agenda;
(4) Key points of the director’s speech;
(5) The voting method and results of each resolution matter (the voting results should indicate the number of votes in favor, against or abstention).
Section 3 Independent Directors
Article 126 Independent directors shall conscientiously perform their duties in accordance with laws, administrative regulations, the provisions of the China Securities Regulatory Commission, the stock exchange and these Articles of Association, play a role in decision-making, supervision and balance, and professional consulting in the board of directors, safeguard the overall interests of the company, and protect the legitimate rights and interests of small and medium-sized investors.
Article 127 Independent directors must maintain independence. The following persons are not allowed to serve as independent directors:
(1) Personnel working in the company or affiliated enterprises and their spouses, parents, children, and major social relations;
(2) Natural person shareholders and their spouses, parents, and children who directly or indirectly hold more than 1% of the company’s issued shares or are among the top 10 shareholders of the company;
(3) Shareholders who directly or indirectly hold more than 5% of the company’s issued shares or persons who serve as the top five shareholders of the company and their spouses, parents, and children;
(4) Personnel working in affiliated enterprises of the company’s controlling shareholder or actual controller and their spouses, parents, and children;
(5) Personnel employed by units and their controlling shareholders and actual controllers that have significant business dealings with the company, its controlling shareholders, actual controllers, or their respective affiliated enterprises;
(6) Personnel who provide financial, legal, consulting, sponsorship and other services to the company and its controlling shareholders, actual controllers or their respective affiliated enterprises, including but not limited to all members of the project team of the intermediary agency providing services, review personnel at all levels, personnel who signed the report, partners, directors, senior managers and principal persons in charge;
(7) Persons who have had the circumstances listed in items (1) to (6) in the last 12 months;
(8) Other personnel who are not independent as stipulated in laws, administrative regulations, regulations of the China Securities Regulatory Commission, business rules of stock exchanges and these Articles of Association.
The subsidiaries of the company's controlling shareholders and actual controllers in items (4) to (6) of the preceding paragraph do not include enterprises controlled by the same state-owned asset management institution as the company and which are not affiliated with the company in accordance with relevant regulations.
Independent directors should conduct self-examinations on their independence every year and submit the self-examination results to the board of directors. The board of directors should evaluate the independence of serving independent directors every year and issue special opinions, which should be disclosed at the same time as the annual report.
Article 128 To serve as an independent director of a company, one must meet the following conditions:
(1) Qualified to serve as a director of a listed company in accordance with laws, administrative regulations and other relevant provisions;
(2) Meet the independence requirements stipulated in this Articles of Association;
(3) Have basic knowledge of the operation of listed companies and be familiar with relevant laws, regulations and rules;
(4) Have more than five years of legal, accounting or economic work experience necessary to perform the duties of an independent director;
(5) Have good personal moral character and have no bad records such as major breach of trust;
(6) Other conditions stipulated in laws, administrative regulations, regulations of the China Securities Regulatory Commission, business rules of stock exchanges and these Articles of Association.
To serve as an independent director as an accounting professional, in addition to meeting the above conditions, he should also have extensive accounting professional knowledge and experience, and meet at least one of the following conditions:
(1) Having the qualification of certified public accountant;
(2) Have a senior professional title, associate professor or above, or a doctoral degree in accounting, auditing or financial management;
(3) Have a senior professional title in economic management, and have more than 5 years of full-time work experience in professional positions such as accounting, auditing or financial management.
Article 129 As a member of the board of directors, independent directors have a duty of loyalty and diligence to the company and all shareholders, and prudently perform the following duties:
(1) Participate in the decision-making of the board of directors and express clear opinions on the matters discussed;
(2) Supervise potential major conflicts of interest between the company and its controlling shareholders, actual controllers, directors, and senior managers, and protect the legitimate rights and interests of small and medium-sized investors;
(3) Provide professional and objective suggestions on the company’s business development and promote the improvement of the board’s decision-making level;
(4) Other duties stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
Article 130 Independent directors shall exercise the following special powers:
(1) Independently hire intermediaries to audit, consult or verify specific matters of the company;
(2) Propose to the board of directors to convene an extraordinary shareholders’ meeting;
(3) Proposing to convene a board meeting;
(4) Publicly solicit shareholder rights from shareholders in accordance with the law;
(5) Express independent opinions on matters that may damage the rights and interests of the company or small and medium-sized shareholders;
(6) Other powers stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
The exercise of the powers listed in items (1) to (3) of the preceding paragraph by independent directors shall require the consent of more than half of all independent directors.
If an independent director exercises the powers listed in paragraph 1 of this article, the company will promptly disclose it. If the above powers cannot be exercised normally, the company will disclose the specific circumstances and reasons.
Article 131 The following matters shall be submitted to the board of directors for review after being approved by more than half of all independent directors of the company:
(1) Related transactions that should be disclosed;
(2) Plans for the company and relevant parties to change or waive their commitments;
(3) The decisions made and measures taken by the board of directors of the acquired listed company regarding the acquisition;
(4) Other matters stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
Article 132 The company shall establish a special meeting mechanism attended by all independent directors. The board of directors' review of related transactions and other matters shall be approved in advance by a special meeting of independent directors.
The company holds special meetings of independent directors regularly or irregularly. The matters listed in Items (1) to (3) and Article 131 of Paragraph 1 of Article 130 of the Articles of Association shall be reviewed by special meetings of independent directors.
Special meetings of independent directors can study and discuss other matters of the company as needed.
Special meetings of independent directors shall be convened and presided over by an independent director jointly recommended by more than half of the independent directors; if the convener fails or is unable to perform his duties, two or more independent directors may convene and preside over the meeting by nominating a representative. Minutes of special meetings of independent directors shall be made in accordance with regulations, and the opinions of independent directors shall be stated in the minutes. Independent directors should sign and confirm the meeting minutes.
The company provides convenience and support for the convening of special meetings of independent directors.
Section 4 Special Committees of the Board of Directors
Article 133 The company's board of directors shall establish an audit committee to exercise the powers of the board of supervisors as stipulated in the Company Law.
Article 134 The Audit Committee shall consist of 3 members who are directors who do not serve as senior managers of the company, including at least 2 independent directors, and accounting professionals among the independent directors shall serve as the convener.
Article 135 The Audit Committee is responsible for reviewing the company's financial information and its disclosure, supervising and evaluating internal and external audit work and internal control. The following matters shall be submitted to the Board of Directors for review after being approved by more than half of all members of the Audit Committee:
(1) Disclose financial information and internal control evaluation reports in financial accounting reports and periodic reports;
(2) Appoint or dismiss the accounting firm that handles the company’s audit business;
(3) Appoint or dismiss the company’s financial director;
(4) Changes in accounting policies, accounting estimates or correction of major accounting errors due to reasons other than changes in accounting standards;
(5) Other matters stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
Article 136 The Audit Committee shall hold at least one meeting every quarter. Extraordinary meetings may be convened upon the proposal of 2 or more members, or when the convener deems it necessary. Meetings of the Review Committee must be attended by more than 2/3 of the members.
Resolutions made by the Audit Committee must be approved by more than half of the members of the Audit Committee.
The voting on resolutions of the Audit Committee shall be one person, one vote.
The audit committee's resolutions shall be followed by meeting minutes in accordance with regulations, and the members of the audit committee who attended the meeting shall sign on the meeting minutes.
The working procedures of the Audit Committee are formulated by the Board of Directors.
Article 137 The company's board of directors shall set up special committees such as the Strategy Committee, the Nomination Committee, and the Remuneration and Appraisal Committee to perform their duties in accordance with the Articles of Association and the authorization of the board of directors. The proposals of the special committees shall be submitted to the board of directors for review. The working procedures of special committees are formulated by the board of directors.
The nomination committee and the remuneration and assessment committee should have a majority of independent directors, and the independent directors should serve as the convener.
Article 138: Five members of the Strategy Committee of the Board of Directors. The main responsibilities of the Strategy Committee of the Board of Directors are to conduct research on the company’s long-term development and major investment decisions, and to make recommendations to the Board of Directors on the following matters:
(1) Conduct research and make suggestions on the company’s long-term development strategic plan;
(2) Conduct research and make recommendations on major investment and financing plans that are subject to approval by the board of directors as stipulated in this Article of Association;
(3) Conduct research and make recommendations on major capital operations and asset management projects that are subject to approval by the board of directors as stipulated in this Article of Association;
(4) Conduct research and make suggestions on other major matters affecting the company’s development;
(5) Inspect the implementation of the above matters;
(6) Other matters authorized by the board of directors.
Article 139: 3 members of the Nomination Committee. The Nomination Committee is responsible for formulating the selection criteria and procedures for directors and senior managers, selecting and reviewing candidates for directors and senior managers and their qualifications, and making recommendations to the board of directors on the following matters:
(1) Nominate or appoint or remove directors;
(2) Appoint or dismiss senior managers;
(3) Other matters stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
If the board of directors fails to adopt or fully adopts the recommendations of the nomination committee, it shall record the opinions of the nomination committee and the specific reasons for failure to adopt them in the board resolution and disclose them.
Article 140: 3 members of the Salary and Appraisal Committee. The Remuneration and Appraisal Committee is responsible for formulating and conducting assessment standards for directors and senior managers, formulating and reviewing remuneration policies and plans such as the remuneration determination mechanism, decision-making process, payment and stop-payment recourse arrangements for directors and senior managers, and making recommendations to the board of directors on the following matters:
(1) Remuneration of directors and senior managers;
(2) Formulate or change equity incentive plans and employee stock ownership plans, and ensure that incentive objects are granted rights and the conditions for exercising rights are met;
(3) Directors and senior managers arrange shareholding plans for the subsidiaries to be spun off;
(4) Other matters stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
If the board of directors fails to adopt or fully adopts the recommendations of the Remuneration and Appraisal Committee, it shall record the opinions of the Remuneration and Appraisal Committee and the specific reasons for failure to adopt them in the resolution of the board of directors and disclose them.
Chapter 6 Senior Management
Article 141 The company shall have one manager, who shall be appointed or dismissed by the board of directors.
The company has several deputy managers, who are appointed or dismissed by the board of directors.
Article 142 The provisions of this Articles of Association regarding the circumstances in which directors are not allowed to serve as directors and the resignation management system shall also apply to senior managers.
The provisions of this Articles of Association regarding directors' duties of loyalty and diligence also apply to senior managers.
Article 143 Persons who hold other administrative positions other than directors and supervisors in the company's controlling shareholder units shall not serve as senior managers of the company.
The company's senior managers only receive their salaries from the company and are not paid by the controlling shareholder.
Article 144: The term of each manager is three years, and the manager can be re-elected.
Article 145 The manager shall be responsible to the board of directors and shall exercise the following powers:
(1) Preside over the company’s production, operation and management work, organize the implementation of board resolutions, and report work to the board of directors;
(2) Organize and implement the company’s annual business plan and investment plan;
(3) Formulate a plan for the establishment of the company’s internal management organization;
(4) Formulate the company’s basic management system;
(5) Formulate specific regulations of the company;
(6) Request the board of directors to appoint or dismiss the company’s deputy manager and financial director;
(7) Decide to appoint or dismiss responsible management personnel other than those who shall be appointed or dismissed by the board of directors;
(8) Other powers granted by this Articles of Association or the Board of Directors.
Managers attend board meetings.
Article 146 The manager shall formulate managerial work rules and submit them to the board of directors for approval before implementation.
Article 147 The manager’s working rules include the following contents:
(1) Conditions, procedures and participants for the managers’ meeting;
(2) The specific responsibilities and division of labor of managers and other senior managers;
(3) The use of company funds and assets, the authority to sign major contracts, and the reporting system to the board of directors;
(4) Other matters deemed necessary by the board of directors.
Article 148 The manager may resign before the expiration of his term of office. The specific procedures and methods for a manager's resignation shall be stipulated in the labor contract between the manager and the company.
Article 149 Based on its own circumstances, the company shall stipulate in its articles of association the procedures for the appointment and removal of deputy managers, the relationship between the deputy managers and the manager, and may stipulate the duties and powers of the deputy managers.
Article 150 The company shall have a secretary to the board of directors, who shall be responsible for the preparation of the company’s shareholders’ and board of directors’ meetings, the storage of documents, the management of the company’s shareholder information, and the handling of information disclosure matters.
The secretary of the board of directors shall abide by the relevant provisions of laws, administrative regulations, department rules and these articles of association.
Article 151 If a senior manager performs the company's duties and causes damage to others, the company will be liable for compensation; if a senior manager commits intentional or gross negligence, he shall also be liable for compensation.
If senior managers violate laws, administrative regulations, departmental rules or the provisions of these Articles of Association when performing their duties and cause losses to the company, they shall be liable for compensation.
Article 152 The senior managers of the company shall faithfully perform their duties and safeguard the best interests of the company and all shareholders.
If a company's senior managers fail to faithfully perform their duties or violate their fiduciary obligations, thereby causing damage to the interests of the company and public shareholders, they shall be liable for compensation in accordance with the law.
Chapter 7 Financial Accounting System, Profit Distribution and Auditing
Section 1 Financial Accounting System
Article 153 The company shall formulate its financial accounting system in accordance with laws, administrative regulations and the provisions of relevant state departments.
Article 154 The company shall submit and disclose an annual report to the CSRC offices and stock exchanges within 4 months from the end of each fiscal year, and submit and disclose an interim report to the CSRC offices and stock exchanges within 2 months from the end of the first half of each fiscal year.
The above-mentioned annual reports and interim reports are prepared in accordance with relevant laws, administrative regulations, China Securities Regulatory Commission and stock exchange regulations.
Article 155 The company shall not maintain separate accounting books other than the statutory accounting books. The company's funds are not stored in accounts opened in any individual's name.
Article 156 When the company distributes after-tax profits for the year, it shall withdraw 10% of the profits and include them in the company's statutory public reserve fund. If the cumulative amount of the company's statutory reserve fund is more than 50% of the company's registered capital, no further withdrawals can be made. If the company's statutory reserve fund is insufficient to make up for losses in previous years, it shall first use the current year's profits to make up for the losses before withdrawing the statutory reserve fund in accordance with the provisions of the preceding paragraph.
After the company withdraws the statutory public reserve fund from the after-tax profits, it can also withdraw the discretionary public reserve fund from the after-tax profits upon resolution of the shareholders' meeting.
The remaining after-tax profits after the company has made up for its losses and withdrawn the reserve fund shall be distributed according to the proportion of shares held by shareholders, except where the Articles of Association stipulate that distribution is not based on the proportion of shareholdings.
If the shareholders' meeting distributes profits to shareholders in violation of the Company Law, the shareholders shall return the profits distributed in violation of the regulations to the company; if losses are caused to the company, the shareholders and the responsible directors and senior managers shall bear the liability for compensation.
The company's shares held by the company will not participate in the distribution of profits.
Article 157 The company’s profit distribution policy is:
- Basic principles of the company’s profit distribution policy
The company implements an active profit distribution policy and attaches great importance to reasonable investment returns for investors. The company should maintain the continuity and stability of the profit distribution policy, while taking into account the long-term interests of the company, the overall interests of all shareholders and the sustainable development of the company. Profit distribution should not exceed the scope of distributable profits and should not damage the company's ability to continue operating. The company's board of directors and shareholders' meetings should fully consider the opinions of independent directors and public investors in the decision-making and demonstration process of profit distribution policies.
- Method of profit distribution
The company can distribute profits in the form of cash, stocks, or a combination of cash and stocks, with cash dividends being the preferred method of profit distribution. On the premise of ensuring that the company's share capital size and equity structure are reasonable, the company can distribute profits in the form of stock dividends while implementing cash dividends.
- Conditions for stock dividend distribution
When the company's operating conditions are good and the board of directors believes that issuing stock dividends is beneficial to the overall interests of all shareholders of the company, it can propose a stock dividend distribution plan on the premise of ensuring sufficient cash dividend distribution. If stock dividends are used for profit distribution, there should be real and reasonable factors such as the company's growth potential and the dilution of net assets per share. 4. Conditions for cash dividends
Dividends can be distributed when the following conditions are met:
(1) The company’s distributable profits for the year (i.e., the after-tax profits remaining after the company makes up for its losses and withdraws its provident fund) are positive, and its cash flow is sufficient. The implementation of cash dividends will not affect the company’s subsequent ongoing operations;
(2) The audit institution issues a standard unqualified audit report on the company's financial report for that year.
(3) There are no special circumstances that make it impossible to distribute cash dividends (such as confirmed major capital expenditure arrangements, etc.). 5. Specific arrangements for cash dividends
The company's cumulative profits distributed in cash in the past three years shall not be less than 30% of the average annual distributable profits achieved in the past three years.
The board of directors should comprehensively consider factors such as the characteristics of the industry, development stage, own business model, profitability level, and whether there are major capital expenditure arrangements, distinguish the following situations, and propose differentiated cash dividend policies in accordance with the procedures stipulated in the company's articles of association:
(1) If the company is in a mature development stage and has no major capital expenditure arrangements, when distributing profits, the proportion of cash dividends in this profit distribution should be at least 80%;
(2) If the company is in a mature stage of development and has major capital expenditure arrangements, when distributing profits, the proportion of cash dividends in this profit distribution should be at least 40%;
(3) If the company is in the growth stage and has major capital expenditure arrangements, when distributing profits, the proportion of cash dividends in the profit distribution should be at least 20%;
If the company's development stage is difficult to distinguish but there are major capital expenditure arrangements, it can be handled in accordance with the provisions of the preceding paragraph. A major investment plan or major cash expenditure refers to one of the following situations:
(1) The company’s planned cumulative expenditure on external investment, asset acquisition or equipment purchase in the next 12 months reaches or exceeds 50% of the company’s latest audited net assets;
(2) The company’s cumulative expenditure on external investment, asset acquisition or equipment purchase in the next 12 months reaches or exceeds 30% of the company’s latest audited total assets.
- Period intervals for profit distribution
On the premise of complying with the principle of profit distribution and ensuring the company's normal operation and long-term development, the company will, in principle, distribute profits once every year after the annual shareholders' meeting. When the company convenes the annual shareholders' meeting to review the annual profit distribution plan, it may review and approve the conditions, proportion limit, amount limit, etc. for the next year's interim cash dividend. The upper limit of interim dividends for the next year reviewed by the annual shareholders' meeting shall not exceed the net profit attributable to the company's shareholders during the corresponding period. The board of directors will formulate a specific interim dividend plan based on the resolution of the shareholders' meeting and subject to profit distribution conditions.
- Decision-making procedures and mechanisms
When the company formulates a specific profit distribution plan, the board of directors should carefully study and demonstrate the timing, conditions and minimum proportions of the company's profit distribution, conditions for adjustment and decision-making process requirements, etc., and submit it to the shareholders' meeting for review after review by the board of directors.
If independent directors believe that the profit distribution plan may harm the rights and interests of the company or small and medium-sized investors, they have the right to express independent opinions. If the board of directors fails to adopt the opinions of independent directors or does not fully adopt them, it shall disclose the opinions of independent directors and the specific reasons for not adopting them in the announcement of the board of directors' resolution and disclose them.
When the shareholders' meeting reviews the profit distribution plan, the company should proactively communicate with shareholders, especially small and medium-sized investors, through multiple channels, fully listen to the opinions and demands of small and medium-sized investors, and promptly respond to issues of concern to small and medium-sized investors.
If the company is profitable for the year and meets the conditions for cash dividends, but the board of directors fails to submit a profit distribution plan to the shareholders' meeting in accordance with the established profit distribution policy, it should explain the reasons, the purpose of the funds not used for dividends retained by the company, and the use plan in the regular report.
- Changes in the company’s profit distribution policy
The company shall strictly implement the cash dividend policy determined in this Articles of Association and the profit distribution plan reviewed and approved by the shareholders' meeting.
If the profit distribution policy needs to be adjusted due to major changes in the external operating environment or its own operating conditions, the starting point should be to protect shareholders' rights and interests, and the reasons should be demonstrated and explained in detail in the shareholders' meeting proposal; the adjusted profit distribution policy must not violate the relevant regulations of the China Securities Regulatory Commission and the stock exchange; the proposal to adjust the profit distribution policy must be reviewed and approved by the board of directors and submitted to the shareholders' meeting for approval. When the shareholders' meeting considers the proposal, online voting and other methods should be used to provide conditions for public shareholders to participate in the meeting. The profit distribution policy adjustment plan shall be approved by more than 2/3 of the voting rights held by shareholders attending the shareholders' meeting.
Major changes in the company's external operating environment or its own operating conditions refer to one of the following situations:
(1) Major changes in national laws, regulations and industry policies have had a significant adverse impact on the company's production and operations, resulting in operating losses;
(2) The occurrence of force majeure factors such as war and natural disasters has a major adverse impact on the company's production and operations, resulting in the company's operating losses;
(3) Due to major changes in the external operating environment or its own operating conditions, the ratio of net cash flow generated by the company’s operating activities to net profit is less than 20% for three consecutive fiscal years;
(4) Other matters stipulated by the China Securities Regulatory Commission and the stock exchange.
Article 158 After the company's shareholders make a resolution on the profit distribution plan, or after the company's board of directors formulates a specific plan based on the next year's interim dividend conditions and upper limit reviewed and approved by the annual shareholders' meeting, the distribution of dividends (or shares) must be completed within 2 months.
Article 159 The company's public reserve shall be used to make up for the company's losses, expand the company's production and operations, or be converted into increasing the company's registered capital.
To make up for the company's losses from the public reserve fund, the discretionary public reserve fund and statutory public reserve fund shall be used first; if it still cannot be made up, the capital public reserve fund may be used in accordance with regulations.
When the statutory reserve fund is converted to increase the registered capital, the remaining reserve fund shall not be less than 25% of the company's registered capital before the conversion.
Section 2 Internal Audit
Article 160 The company shall implement an internal audit system and clarify the leadership structure, responsibilities and authorities, staffing, funding guarantee, application of audit results and accountability for internal audit.
The company's internal audit system is implemented after approval by the board of directors and disclosed to the outside world.
Article 161 The company’s internal audit institution shall supervise and inspect the company’s business activities, risk management, internal control, financial information and other matters.
The internal audit institution shall maintain independence and be equipped with full-time auditors. It shall not be placed under the leadership of the financial department, or work together with the financial department.
Article 162 The internal audit institution shall be responsible to the board of directors.
The internal audit institution shall accept the supervision and guidance of the audit committee during the supervision and inspection of the company's business activities, risk management, internal control, and financial information. If the internal audit institution discovers relevant major issues or clues, it shall immediately report directly to the audit committee.
Article 163 The internal audit institution is responsible for the specific organization and implementation of the company's internal control evaluation. The company issues an annual internal control evaluation report based on the evaluation report and relevant information issued by the internal audit institution and reviewed by the audit committee.
Article 164 When the audit committee communicates with external audit units such as accounting firms and national audit institutions, the internal audit institutions shall actively cooperate and provide necessary support and collaboration.
Article 165 The audit committee shall participate in the assessment of the person in charge of internal audit.
Section 3 Appointment of Accounting Firm
Article 166 The company shall employ an accounting firm that complies with the provisions of the Securities Law to provide auditing of accounting statements, verification of net assets and other related consulting services. The term of appointment shall be one year and may be renewed.
Article 167 The company's appointment or dismissal of an accounting firm shall be decided by the shareholders' meeting. The board of directors shall not appoint an accounting firm before the shareholders' meeting makes a decision.
Article 168 The company guarantees to provide true and complete accounting vouchers, accounting books, financial accounting reports and other accounting information to the accounting firm hired, and shall not refuse, conceal or make false statements.
Article 169 The audit fees of an accounting firm shall be determined by the shareholders' meeting.
Article 170 When the company dismisses or does not renew the appointment of the accounting firm, it shall notify the accounting firm 30 days in advance. When the company's shareholders meeting votes on the dismissal of the accounting firm, the accounting firm shall be allowed to state its opinions.
If an accounting firm proposes to resign, it shall explain to the shareholders' meeting whether there are any improper circumstances in the company.
Chapter 8 Notices and Announcements
Section 1 Notice
Article 171 The company’s notice shall be issued in the following forms:
(1) Delivered by a dedicated person;
(2) Sent by mail;
(3) By way of announcement;
(4) Other forms stipulated in this charter.
Article 172 If the company issues a notice in the form of an announcement, all relevant personnel shall be deemed to have received the notice once the announcement is made.
Article 173 The notice of the company’s shareholders’ meeting shall be made by public announcement.
Article 174 The notice of the company's board of directors meeting shall be sent by hand, registered mail, fax or email.
Article 175 If the company's notice is sent by a special person, the person to be served shall sign (or stamp) the delivery receipt, and the date of receipt by the person to be served shall be the date of delivery; if the company's notice is sent by registered mail, the date of delivery shall be 5 days from the date of delivery to the post office. working days as the delivery date; if the company notice is sent by fax, the date stated on the completed delivery report output by the company's fax machine shall be the delivery date; if the company notice is sent by email, the date confirmed when the email is sent shall be the delivery date; if the company notice is sent by announcement, the date of the first announcement shall be the delivery date.
Article 176 If the meeting notice is not sent to a person who has the right to receive the notice due to accidental omission or such person fails to receive the meeting notice, the meeting and the resolutions passed at the meeting will not be invalid.
Section 2 Announcement
Article 177 The company's information disclosure shall designate media that meet the conditions stipulated by the securities regulatory authority of the State Council and the website designated by the stock exchange as the media for publishing company announcements and other information that needs to be disclosed. The information disclosed by the company should also be kept at the company's domicile and other designated places for public inspection.
Chapter 9 Merger, spin-off, capital increase, capital reduction, dissolution and liquidation
Section 1 Merger, spin-off, capital increase and capital reduction
Article 178 The merger of a company may take the form of merger by absorption or merger by new establishment.
When a company absorbs other companies, it is called a merger, and the absorbed company is dissolved. The merger of two or more companies to establish a new company is a new merger, and the merging parties are dissolved.
Article 179 If the price paid for the merger of a company does not exceed 10% of the company's net assets, it can be done without a resolution of the shareholders' meeting, unless otherwise provided in these articles of association.
If a company merges in accordance with the provisions of the preceding paragraph without a resolution of the shareholders' meeting, it shall be subject to a resolution of the board of directors.
Article 180 When a company merges, the merging parties shall sign a merger agreement and prepare a balance sheet and property list. The company shall notify its creditors within 10 days from the date of making the merger resolution, and shall make an announcement in the newspapers and periodicals specified in Article 177 of the Articles of Association or on the National Enterprise Credit Information Publicity System within 30 days.
Creditors may require the company to pay off debts or provide corresponding guarantees within 30 days from the date of receipt of the notice, or within 45 days from the date of announcement if no notice is received.
Article 181 When a company merges, the claims and debts of the merging parties shall be inherited by the surviving company or the newly established company after the merger.
Article 182 When a company is divided, its property shall be divided accordingly.
When a company is divided, a balance sheet and property list must be prepared. The company shall notify its creditors within 10 days from the date of making the separation resolution, and shall make an announcement within 30 days in the newspapers and periodicals specified in Article 177 of the Articles of Association or on the National Enterprise Credit Information Publicity System.
Article 183 The debts incurred before the division of the company shall be jointly and severally borne by the company after the division. However, this shall not be the case unless otherwise agreed upon in a written agreement between the company and its creditors regarding debt settlement before the division.
Article 184 The company will prepare a balance sheet and property list when reducing its registered capital.
The company shall notify creditors within 10 days from the date when the shareholders' meeting makes a resolution to reduce the registered capital, and shall make an announcement within 30 days in the newspapers and periodicals specified in Article 177 of the Articles of Association or on the National Enterprise Credit Information Publicity System. Creditors have the right to require the company to pay off debts or provide corresponding guarantees within 30 days from the date of receiving the notice, or within 45 days from the date of announcement if the creditors have not received the notice.
When a company reduces its registered capital, it shall reduce its capital contribution or shares accordingly in proportion to the shares held by shareholders, unless otherwise provided by law or these Articles of Association.
Article 185 If the company still has losses after making up for losses in accordance with the provisions of paragraph 2 of Article 159 of the Articles of Association, it may reduce its registered capital to make up for the losses. If the registered capital is reduced to make up for losses, the company shall not distribute to shareholders, nor may it exempt shareholders from their obligation to pay capital contributions or share payments.
If the registered capital is reduced in accordance with the provisions of the preceding paragraph, the provisions of Paragraph 2 of Article 184 of this Article shall not apply, but an announcement shall be made in the newspapers and periodicals specified in Article 177 of this Article or the National Enterprise Credit Information Publicity System within 30 days from the date when the shareholders' meeting makes a resolution to reduce the registered capital.
After the company reduces its registered capital in accordance with the provisions of the preceding two paragraphs, it shall not distribute profits until the cumulative amount of the statutory reserve fund and discretionary reserve fund reaches 50% of the company's registered capital.
Article 186 If the registered capital is reduced in violation of the Company Law and other relevant provisions, the shareholders shall return the funds received, and those who reduce or reduce the capital contribution shall be restored to their original status; if losses are caused to the company, the shareholders and the responsible directors and senior managers shall bear the liability for compensation.
Article 187 When a company issues new shares to increase its registered capital, shareholders do not have preemptive subscription rights, unless otherwise provided in the Articles of Association or the shareholders' meeting decides that shareholders have preemptive subscription rights.
Article 188 If a company is merged or divided and the registered items are changed, the change registration shall be carried out with the company registration authority in accordance with the law; if the company is dissolved, the company shall be deregistered in accordance with the law; if a new company is established, the company establishment registration shall be carried out in accordance with the law.
If a company increases or decreases its registered capital, it must apply for change registration with the company registration authority in accordance with the law.
Section 2 Dissolution and Liquidation
Article 189 The company is dissolved for the following reasons:
(1) The business period stipulated in these articles of association expires or other reasons for dissolution stipulated in these articles of association occur;
(2) The shareholders’ meeting resolves to dissolve;
(3) Dissolution is required due to company merger or division;
(4) The business license has been revoked, ordered to close, or revoked in accordance with the law;
(5) If the company encounters serious difficulties in its operation and management, and its continued existence will cause heavy losses to the interests of shareholders, and cannot be solved through other means, shareholders holding more than 10% of the company's voting rights may request the People's Court to dissolve the company.
If a company encounters the reasons for dissolution specified in the preceding paragraph, it shall publicize the reasons for dissolution through the National Enterprise Credit Information Publicity System within 10 days.
Article 190 If a company falls under the circumstances specified in Item (1) or (2) of Article 189 of the Articles of Association and has not yet distributed property to shareholders, it may continue to exist by amending the Articles of Association or by resolution of the shareholders' meeting.
Amending the Articles of Association or making a resolution at the shareholders' meeting in accordance with the provisions of the preceding paragraph must be approved by more than 2/3 of the voting rights held by shareholders attending the shareholders' meeting.
Article 191 If the company is dissolved due to the provisions of Items (1), (2), (4) and (5) of Article 189 of this Article of Association, it shall be liquidated. Directors are the liquidation obligors of the company and shall establish a liquidation group to carry out liquidation within 15 days from the date of occurrence of the reasons for dissolution.
The liquidation committee shall be composed of directors, unless otherwise stipulated in the Articles of Association or another person shall be elected by resolution of the shareholders' meeting.
If the liquidation obligor fails to perform liquidation obligations in a timely manner and causes losses to the company or creditors, he shall be liable for compensation.
Article 192 The liquidation committee shall exercise the following powers during the liquidation period:
(1) Clean up the company’s properties and prepare a balance sheet and property list respectively;
(2) Notify and announce creditors;
(3) Handle the company’s unfinished business related to liquidation;
(4) Pay the taxes owed and the taxes incurred during the liquidation process;
(5) Clearing claims and debts;
(6) Distribute the company’s remaining property after paying off its debts;
(7) Participate in civil litigation activities on behalf of the company.
Article 193 The liquidation team shall notify creditors within 10 days from the date of establishment, and shall make an announcement within 60 days in the newspapers and periodicals specified in Article 177 of the Articles of Association or on the national enterprise credit information publicity system. Creditors shall declare their claims to the liquidation team within 30 days from the date of receipt of the notice, or within 45 days from the date of announcement if the notice is not received.
When a creditor declares a creditor's right, he shall explain the relevant matters of the creditor's right and provide supporting materials. The liquidation team shall register the claims.
During the period of reporting claims, the liquidation team shall not pay off creditors.
Article 194 After clearing the company's assets and preparing a balance sheet and property list, the liquidation team shall formulate a liquidation plan and submit it to the shareholders' meeting or the people's court for confirmation.
The company's property is the remaining property after paying liquidation expenses, employees' wages, social insurance fees and statutory compensation, paying taxes owed, and paying off the company's debts respectively, and the company distributes the remaining property according to the proportion of shares held by shareholders. During the liquidation period, the company continues to exist, but it is not allowed to carry out business activities unrelated to the liquidation.
The company's property will not be distributed to shareholders before it is paid off in accordance with the provisions of the preceding paragraph.
Article 195 If, after cleaning up the company's property and preparing a balance sheet and property list, the liquidation team finds that the company's property is insufficient to pay off its debts, it shall apply to the People's Court for bankruptcy liquidation in accordance with the law.
After the People's Court accepts the bankruptcy application, the liquidation team shall transfer the liquidation affairs to the bankruptcy administrator appointed by the People's Court.
Article 196 After the company's liquidation is completed, the liquidation team shall prepare a liquidation report, submit it to the shareholders' meeting or the people's court for confirmation, and submit it to the company registration authority to apply for cancellation of company registration.
Article 197 Members of the liquidation committee shall perform their liquidation duties and shall have obligations of loyalty and diligence.
If members of the liquidation team neglect to perform their liquidation duties and cause losses to the company, they shall be liable for compensation; if members of the liquidation team cause losses to creditors intentionally or due to gross negligence, they shall be liable for compensation.
Article 198 If a company is declared bankrupt in accordance with the law, bankruptcy liquidation shall be carried out in accordance with the laws on enterprise bankruptcy.
Chapter 10 Modification of the Articles of Association
Article 199 The company shall amend its articles of association under any of the following circumstances:
(1) After the Company Law or relevant laws and administrative regulations are revised, the matters stipulated in the articles of association conflict with the provisions of the revised laws and administrative regulations;
(2) The company's situation changes and is inconsistent with the matters recorded in the articles of association;
(3) The shareholders' meeting decides to amend the articles of association.
Article 200 If the amendments to the articles of association passed by the resolution of the shareholders' meeting are subject to the approval of the competent authority, they must be reported to the competent authority for approval; if they involve company registration matters, the change registration must be handled in accordance with the law.
Article 201 The Board of Directors shall amend the Articles of Association in accordance with the resolution of the shareholders’ meeting to amend the Articles of Association and the approval opinions of the relevant competent authorities.
Article 202: Amendments to the Articles of Association are information required to be disclosed by laws and regulations and shall be announced in accordance with regulations.
Chapter 11 Supplementary Provisions
Article 203 Interpretation
(1) Controlling shareholders refer to shareholders whose shares account for more than 50% of the company's total capital stock; or shareholders whose shares do not exceed 50%, but whose voting rights are sufficient to have a significant impact on the resolutions of the shareholders' meeting.
(2) Actual controller refers to a natural person, legal person or other organization that can actually control the company's behavior through investment relationships, agreements or other arrangements.
(3) Transactions, including the following types of matters that occur outside the company’s daily operating activities: 1. Purchase or sale of assets;
External investment (including entrusted financial management, investment in subsidiaries, etc.);
Provide financial assistance (including interest-free or interest-free loans, entrusted loans, etc.); 4. Provide guarantees (including guarantees for holding subsidiaries, etc.);
Lease or lease assets;
Entrust or entrust management of assets and business;
Donate or receive donated assets;
Creditor's rights and debt restructuring;
Sign a license agreement;
Transfer or transfer R&D projects;
Waiver of rights (including waiver of preemptive rights, preemptive subscription rights, etc.); 12. Other transactions recognized by the stock exchange.
(4) Related transactions refer to the transfer of resources or obligations between the company, its holding subsidiaries and other entities controlled by the company and its related parties, including:
Transaction matters specified in Article 203 (3) of this Article;
Purchase raw materials, fuel, and power;
Selling products and merchandise;
Provide or accept labor services;
Entrust or entrust sales;
Deposit and loan business;
Joint investment with related parties;
Other matters that may result in the transfer of resources or obligations through agreement.
(5) Related relationships refer to the relationships between the company’s controlling shareholders, actual controllers, directors, and senior managers and the companies they directly or indirectly control, as well as other relationships that may lead to the transfer of the company’s interests. However, state-controlled enterprises are related not only because they are also controlled by the state.
The company's related persons include related legal persons and related natural persons:
- A legal person (or other organization) that has one of the following circumstances is an affiliated legal person (or other organization) of the company:
(1) Legal persons (or other organizations) that directly or indirectly control the company;
(2) Legal persons (or other organizations) other than companies, holding subsidiaries and other controlled entities that are directly or indirectly controlled by the legal persons (or other organizations) mentioned in the preceding paragraph;
(3) Legal persons (or other organizations) other than companies, holding subsidiaries and other controlled entities that are directly or indirectly controlled by related natural persons, or serve as directors (excluding independent directors who are both parties) or senior managers;
(4) Legal persons (or other organizations) holding more than 5% of the company's shares and their persons acting in concert.
- A natural person who has one of the following circumstances is an associated natural person of the company:
(1) A natural person who directly or indirectly holds more than 5% of the company’s shares;
(2) Directors and senior managers of the company;
(3) Directors, supervisors and senior managers of legal persons (or other organizations) that directly or indirectly control the company;
(4) Close family members of the persons mentioned in items (1) and (2) of this paragraph.
In the past 12 months or within 12 months after the relevant agreement or arrangement came into effect, a legal person (or other organization) or natural person who has one of the above circumstances is a related person of the company.
The China Securities Regulatory Commission, the stock exchange or the company may, based on the principle of substance over form, identify other legal persons (or other organizations) or natural persons who have a special relationship with the company and may or have caused the company to favor its interests as related persons of the company.
Article 204 The board of directors may formulate detailed rules and regulations in accordance with the provisions of the articles of association, but they shall not conflict with the provisions of the articles of association.
Article 205 These Articles of Association are written in Chinese. If there is any discrepancy between the Articles of Association in any other language or different versions and the Articles of Association, the Chinese version of the Articles of Association that has been most recently approved and registered by the Wuhan Dongxihu District Administrative Approval Bureau shall prevail. Article 206 In this Article, “above” and “within” all include the original number; “over”, “beyond”, “less than” and “more than” do not include the original number.
Article 207 Matters not covered in this Article of Association shall be implemented in accordance with relevant laws, administrative regulations, provisions of the China Securities Regulatory Commission and the rules of the stock exchange; if this Article of Association conflicts with relevant laws, administrative regulations, provisions of the China Securities Regulatory Commission and the rules of the stock exchange, matters shall be implemented in accordance with the relevant laws, administrative regulations, provisions of the China Securities Regulatory Commission and the rules of the stock exchange.
Article 208 The attachments to this Articles of Association include the Rules of Procedure for the Shareholders’ Meeting and the Rules of Procedure for the Board of Directors.
Article 209: This Article of Association shall be interpreted by the company's board of directors and shall come into effect on the date of review and approval by the company's shareholders' meeting.
Thalys Medical Technology Group Co., Ltd.
Legal representative: Wen Wei
January 2026