Resignation Management System for Directors and Senior Managers of Shandong Buchang Pharmaceutical Co., Ltd.
Shandong Buchang Pharmaceutical Co., Ltd. Directors and Senior Management Resignation Management System
Shandong Buchang Pharmaceutical Co., Ltd.
Resignation management system for directors and senior managers
Chapter 1 General Provisions
Article 1 In order to standardize the resignation procedures for directors and senior managers of Shandong Buchang Pharmaceutical Co., Ltd. (hereinafter referred to as the company), ensure the stability and continuity of the company's governance structure, and safeguard the legitimate rights and interests of the company and shareholders, the company, in accordance with the Company Law of the People's Republic of China (hereinafter referred to as the "Company Law") and the Chinese This system is formulated in accordance with the relevant provisions of the Securities Law of the People's Republic of China (hereinafter referred to as the "Securities Law"), the "Stock Listing Rules of the Shanghai Stock Exchange" and other laws, administrative regulations and normative documents, as well as the "Articles of Association of Shandong Buchang Pharmaceutical Co., Ltd." (hereinafter referred to as the "Articles of Association") and based on the actual situation of the company.
Article 2 This system applies to the situation where the company’s directors (including independent directors) and senior managers resign due to expiration of term, resignation, dismissal from office or other reasons.
Article 3 The resignation management of the company’s directors and senior managers shall follow the following principles:
(1) Principles of legality and compliance: Strictly abide by national laws, regulations, regulatory provisions and the requirements of the Articles of Association;
(2) Principle of openness and transparency: timely, accurate and complete disclosure of information related to the resignation of directors and senior managers;
(3) Principle of smooth transition: ensure that the resignation of directors and senior managers does not affect the company’s normal operations and the stability of its governance structure;
(4) Principle of protecting shareholders’ rights and interests: safeguarding the legitimate rights and interests of the company and all shareholders.
Chapter 2 Circumstances and Procedures for Resignation
Shandong Buchang Pharmaceutical Co., Ltd. Directors and Senior Management Resignation Management System
Article 4 The resignation of a company's directors and senior managers includes failure to be re-elected upon expiration of the term, voluntary resignation, being dismissed from office, and other circumstances that lead to the actual resignation of directors and senior managers.
Article 5 Directors and senior managers of a company may resign before the expiration of their term of office. Directors and senior managers who resign must submit a written resignation report to the company. The resignation report shall state the reason for resignation. The resignation shall be effective from the date the company receives the resignation report, and relevant information shall be disclosed within 2 trading days, explaining the reasons and impact.
Article 6 If the following circumstances exist, before 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 the Articles of Association, unless otherwise provided by relevant laws and regulations:
(1) The resignation of a director causes the number of board members to fall below the legal minimum;
(2) The resignation of members of the audit committee results in the number of members of the audit committee falling below the legal minimum, or there is a shortage of accounting professionals;
(3) The resignation of independent directors results in the proportion of independent directors on the board of directors or its special committees not complying with laws, administrative regulations or the Articles of Association, or there is a lack of accounting professionals among independent directors.
Article 7 The company shall disclose the relevant circumstances of the director's resignation within 2 trading days after receiving the resignation report, and explain the reasons and impact. If the resignation of an independent director is involved, it must be stated whether it has a significant impact on corporate governance and independence. If a director resigns, the company shall complete the by-election within 60 days to ensure that the composition of the board of directors and its special committees complies with the provisions of laws, administrative regulations and the Articles of Association.
Article 8 If a company director encounters any situation during his term of office that prohibits him from serving as a company director according to the Company Law and other laws and regulations, the company shall terminate his position in accordance with the law.
The shareholders' meeting may remove a director from his office before the expiration of his term, and the removal shall take effect on the date the resolution is made. When a proposal to remove a director is submitted to the shareholders' meeting, the reasons or basis for the removal of the director should be provided. When a shareholders' meeting considers a proposal to remove a director from office, it shall be passed by more than half of the voting rights held by shareholders present at the shareholders' meeting.
Before convening the shareholders' meeting, the company should notify the directors who are to be dismissed from their posts and inform them of their right to defend themselves at the meeting. Directors may choose to defend themselves orally at a shareholder meeting or submit a written statement and may request that the company communicate the statement to other shareholders. The shareholders' meeting shall review the directors' justifications and make a vote after comprehensively considering the reasons for dismissal and the directors' justifications.
Shandong Buchang Pharmaceutical Co., Ltd. Directors and Senior Management Resignation Management System
Article 9 If a director is dismissed before the expiration of his term without justifiable reasons, the director may request the company to compensate him. The company should comprehensively consider a variety of factors to determine whether to compensate and the reasonable amount of compensation in accordance with laws and regulations, the provisions of the Articles of Association and the relevant provisions of the director's appointment contract.
Article 10 If a senior manager violates laws, regulations, the Articles of Association, or damages the interests of the company due to serious dereliction of duty or dereliction of duty, he or she may be dismissed from his position as a senior manager upon review and approval by the board of directors. His dismissal shall take effect from the date of the resolution of the board of directors. If a senior manager is dismissed before the expiration of his term without justifiable reasons, causing damage to him or her, the matter shall be dealt with in accordance with the labor contract and relevant laws.
Article 11 Directors and senior managers of a company shall entrust the company to declare their names, positions, ID numbers, securities accounts, time of resignation and other personal information through the stock exchange website within 2 trading days after their resignation.
Chapter 3 Responsibilities and Obligations of Resigning Directors and Senior Management
Article 12 Directors and senior managers shall, within 5 working days after their resignation takes effect, hand over to the board of directors all documents, seals, data assets, lists of unfinished affairs and other documents required by the company that involve the company obtained during their term of office.
Article 13 If the resigning personnel are involved in major investments, related transactions or financial decisions and other major matters, the audit committee may initiate a departure audit and report the audit results to the board of directors.
Article 14 Public commitments made by directors and senior managers during their term of office shall continue to be fulfilled regardless of the reason for their resignation. If directors and senior managers have not fulfilled their public commitments when they resign, the departing directors and senior managers should submit a written explanation before leaving their job, clarifying the specific matters that have not fulfilled their commitments, the expected completion time and follow-up implementation plan. When necessary, the company will take corresponding measures to urge the departing directors and senior managers to fulfill their commitments.
Article 15 After the company's directors and senior managers leave their posts, they shall not use their original position to interfere with the company's normal operations or harm the interests of the company and shareholders. The loyalty obligations of departing directors and senior managers to the company and shareholders are not automatically terminated after the end of their term, but remain valid for two years. The responsibilities that resigned directors and senior managers should bear due to the performance of their duties during their tenure will not be exempted or terminated due to resignation.
Article 16 After the company’s directors and senior managers resign, they shall keep the company’s business secrets and technical secrets Shandong Buchang Pharmaceutical Co., Ltd. Resignation Management System for Directors and Senior Managers
and other inside information shall remain in effect after the end of their employment until the relevant information becomes public information.
Article 17 The duration of other obligations borne by resigned directors and senior managers shall be determined based on the principle of fairness, depending on the length of time between the occurrence of the event and resignation, and the circumstances and conditions under which the relationship with the company ends.
Article 18 Directors and senior managers who have not yet completed their term of office shall be liable for compensation for the losses caused to the company due to their absence from office without authorization.
Article 19 If resigned directors or senior managers cause losses to the company due to violation of the Company Law and other relevant laws and regulations, normative documents, the Articles of Association and the relevant provisions of this system, the company has the right to require them to bear corresponding liability for compensation. Those involved in illegal crimes will be transferred to judicial organs for criminal liability.
Chapter 4 Shareholding Management of Resigned Directors and Senior Management
Article 20 Before buying and selling the company's stocks and their derivatives, the company's directors and senior managers should be aware of the provisions of the "Company Law", "Securities Law" and other laws, regulations and normative documents regarding insider trading, market manipulation and other prohibited behaviors, and shall not engage in illegal transactions.
Article 21 Changes in shareholdings of resigned directors and senior managers shall comply with the following regulations:
(1) Directors and senior managers of the company shall not transfer their shares in the company within 6 months after their resignation;
(2) Directors and senior managers of a company who resign before the expiration of their term of office shall comply with the following provisions during the term of office determined when they took office and within 6 months after the expiration of their term of office:
The shares reduced each year through centralized bidding, block transactions, agreement transfers, etc. shall not exceed 25% of the total number of company shares held by them, except for changes in shares due to judicial enforcement, inheritance, bequests, division of property according to law, etc.;
If the shares held by the company’s directors and senior managers do not exceed 1,000 shares, they may be transferred entirely at one time without being restricted by the transfer ratio in the preceding paragraph;
Other regulations of China Securities Regulatory Commission and Shanghai Stock Exchange.
Shandong Buchang Pharmaceutical Co., Ltd. Directors and Senior Management Resignation Management System
Article 22 If resigning directors and senior managers make commitments regarding the proportion of shares held, holding period, change method, change quantity, change price, etc., they shall strictly implement the commitments made.
Article 23 The company’s secretary to the board of directors shall be responsible for supervising the changes in shareholdings of resigned directors and senior managers and reporting to the regulatory authorities in a timely manner if necessary.
Chapter 5 Accountability Mechanism
Article 24 If the company discovers that resigning directors or senior managers have failed to fulfill their commitments, have defective transfers, or have violated their duty of loyalty, the board of directors shall convene a meeting to review the specific liability plan for such personnel. The amount of compensation includes but is not limited to direct losses, expected loss of profits, and reasonable rights protection expenses.
Article 25 If resigning directors or senior managers have objections to the accountability decision, they may apply to the company's audit committee for review within 15 days from the date of receipt of the notice. The review period will not affect the company's property preservation measures (if any).
Chapter 6 Supplementary Provisions
Article 26 Matters not covered in this system shall be implemented in accordance with relevant national laws, administrative regulations, normative documents, the Articles of Association and other relevant provisions; if this system is inconsistent with laws, administrative regulations and the Articles of Association promulgated by the state, the relevant national laws, administrative regulations and the Articles of Association shall prevail.
Article 27 The company’s board of directors is responsible for interpreting this system.
Article 28 This system shall take effect and be implemented upon approval by the company's board of directors, and the same shall apply when it is revised.
Shandong Buchang Pharmaceutical Co., Ltd.
October 2025