Gongdong Medical: Foreign Investment Management System
Zhejiang Gongdong Medical Equipment Co., Ltd.
Foreign investment management system
Chapter 1 General Provisions
Article 1 In order to regulate the investment behavior of Zhejiang Gongdong Medical Equipment Co., Ltd. (hereinafter referred to as the "Company"), control investment risks, increase investment returns, realize the standardization, scientificity and institutionalization of investment decisions, and ensure the safety and profitability of the company's capital operations, this system is specially formulated in accordance with the provisions of the Company Law of the People's Republic of China, the Stock Listing Rules of the Shanghai Stock Exchange (hereinafter referred to as the "Listing Rules") and the Articles of Association of Zhejiang Gongdong Medical Equipment Co., Ltd. (hereinafter referred to as the "Articles of Association") and in light of the actual situation of the company.
Article 2 Investment as referred to in this system refers to various forms of external investment activities carried out by the company for the purpose of obtaining profits, using monetary funds, physical objects or intangible assets as capital contributions, and is applicable to the external investment activities carried out by the company and its holding subsidiaries.
Article 3 According to the length of the investment period, the company’s investment activities are divided into short-term investment and long-term investment. Short-term investments mainly refer to investments purchased by the company that can be liquidated at any time and held for no more than one year (including one year), including various stocks, bonds, funds, etc.; long-term investments mainly refer to various investments with an investment period of more than one year that cannot be liquidated at any time or are not prepared to be liquidated, including bond investments, equity investments, and other investments.
Article 4 If a company invests in non-monetary assets such as fixed assets and intangible assets, it shall go through corresponding transfer procedures in accordance with relevant laws and regulations.
Article 5 The company’s investment activities shall follow the following principles:
(1) Comply with national industrial policies and comply with national laws and regulations;
(2) In line with the company’s development strategic plan;
(3) The investment scale is compatible with the asset structure, is moderate in scale, and within the capabilities, and does not affect the development of the company's main business;
(4) Be prudent, safe and effective, control investment risks and focus on investment returns;
(5) Adhere to the scientific outlook on development and scientific argumentation and decision-making.
Chapter 2 Investment Decision-making Authority and Procedures
Article 6 The examination and approval of the Company’s investment activities shall be carried out in strict accordance with the Company Law, the Listing Rules, the relevant provisions of the China Securities Regulatory Commission and the provisions of the Articles of Association.
Article 7 The company's shareholders' meeting, board of directors, and general manager's office meeting are the company's investment decision-making bodies, and each makes decisions on the company's investment within the scope of their authority. No other department or individual has the right to make decisions on foreign investment.
Article 8 If the company's management has an investment intention during the daily operation and management process, it shall propose a proposal to the general manager's office meeting to discuss the feasibility of the investment and prepare a detailed written report on the specific situation.
Article 9 If a company makes external investment and meets one of the following standards, it shall be submitted to the board of directors for review:
(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 listed 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 latest audited net assets of the listed company, and the absolute amount exceeds 10 million yuan;
(3) The transaction amount (including debts and expenses assumed) accounts for more than 10% of the listed 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 one million yuan;
(5) The relevant operating income of the transaction object (such as equity) in the most recent fiscal year accounts for more than 10% of the company’s audited operating 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 fiscal year accounts for more than 10% of the company's audited net profit in the most recent fiscal year, and the absolute amount exceeds one million yuan.
If a company makes an external investment and meets one of the following standards, it shall be submitted to the shareholders' meeting for review:
(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 is negative, its absolute value is used for calculation. If a company invests externally to establish a limited liability company or a joint-stock company and can pay the full capital contribution in installments in accordance with the provisions of the Company Law, the provisions of the preceding paragraph shall apply based on the agreed full capital contribution.
Article 10 The company strictly controls risk investment, including securities investment, real estate investment, mining rights investment, trust product investment and other investment activities. Among them, securities investment includes investment in domestic and foreign stocks, securities investment funds and other securities and their derivatives, as well as the purchase of financial products from banks and other financial institutions with stocks, interest rates, exchange rates and their derivatives as the main investment targets.
When a company makes venture investments, it shall use the total amount of all types of venture investments as the calculation standard and the accumulated amount for twelve consecutive months to determine the approval authority.
Article 11 Related investments involving related parties shall, in addition to complying with the provisions of this system, also comply with the relevant provisions of the company's related transaction management system.
Article 12 Before the shareholders’ meeting, the board of directors or the general manager’s office meeting decide on an investment matter, the relevant departments of the company shall provide the general manager, the board of directors and the shareholders’ meeting with feasibility study reports or relevant information on the proposed investment project step by step based on the project situation to facilitate their decision-making.
Chapter 3 Investment Implementation and Management
Article 13 The company shall designate the office of the board of directors and the financial department to conduct specialized research and evaluation on the feasibility, investment risks, investment returns and other matters of the company's major investment projects, and supervise the implementation progress of major investment projects. If any abnormality in the investment project is discovered, it shall be reported to the company's board of directors in a timely manner.
Article 14 The business department that proposes investment proposals shall cooperate with the board of directors office and the financial department to conduct feasibility studies and evaluations of the company's investment projects.
(1) Before establishing a project, you should first fully consider the scale and scope of the company's current business development, external investment projects, industries, time, and expected investment returns; secondly, investigate the investment projects and collect relevant information; finally analyze and discuss the collected information and put forward investment suggestions, and report them to the general manager or the board of directors for project filing.
(2) After the project is approved, it is responsible for setting up an investment project evaluation team to conduct feasibility analysis and evaluation of the approved investment projects. At the same time, qualified intermediaries can be hired to participate in the evaluation. During the assessment, various national regulations on foreign investment should be fully considered and ensure compliance with the company's internal rules and regulations, so that all foreign investment activities can be carried out under legal procedures.
Article 15 The company’s financial department is responsible for the financial management of external investments. After the company's external investment project is determined, the company's financial department is responsible for raising funds, cooperating with relevant parties to handle capital contribution procedures, industrial and commercial registration, tax registration, bank account opening, etc., and implementing strict borrowing, approval and payment procedures.
Article 16 The office of the company's board of directors conducts daily management of the company's long-term equity investments and has the function of supervising the company's external investment projects. Designate a designated person to be responsible for the safekeeping of various resolutions, contracts, agreements, and foreign investment equity certificates formed during the investment process, and establish detailed file records. Unauthorized personnel are not allowed to access certificates of entitlement.
Article 17 The company's internal audit department shall organize auditors to conduct regular internal audits of the financial income and expenditure of investment projects and submit written opinions to the board of directors.
Article 18 The secretary of the company's board of directors shall conduct compliance reviews of the company's investment projects. The secretary of the board of directors should strictly comply with the "Listing Rules", "Articles of Association" and other relevant regulations to perform the information disclosure obligations of the company's major investments.
Article 19 Companies that engage in securities investment, entrusted financial management, or investment in derivative products such as futures, options, warrants, etc. based on stocks, interest rates, exchange rates, and commodities shall establish and improve a strict internal control system to control investment risks. Companies are not allowed to use bank credit funds to directly or indirectly enter the securities market or make derivative investments.
Article 20 Securities investment, entrusted financial management, or investment in derivatives such as futures, options, and warrants based on stocks, interest rates, exchange rates, and commodities shall be implemented in accordance with the approval authority and approval procedures stipulated in this system. The board of directors office and the financial department shall regularly report the environmental conditions, risks, and return conditions of the investment, as well as future market forecasts, in written form to the company's board of directors, so as to keep track of the preservation and appreciation of assets and ensure that the board of directors takes effective measures in a timely manner according to market changes to reduce the company's losses. If there are large fluctuations in investment varieties (the cumulative increase or decrease exceeds 20%), the board office and the financial department shall report to the board of directors in a timely manner.
Article 21 When a company engages in entrusted financial management, it should select a qualified professional financial institution with good credit standing, financial status, no bad integrity records and strong profitability as the trustee, and sign a written contract with the trustee to clearly define the amount, period, investment types, rights, obligations and legal responsibilities of both parties.
Article 22 Subsidiaries must formulate and improve their own plans within the framework of the company's medium- and long-term development plans. Subsidiaries must submit their proposed external investment matters into proposals, project proposals or feasibility analysis reports to the general manager of the company, and perform the approval procedures in accordance with the provisions of this system.
Article 23 When a company invests externally to establish a cooperative or joint venture company, it shall dispatch directors and supervisors elected through legal procedures to the newly-established company to participate in and influence the operational decisions of the newly-established company.
Article 24 For a holding company established through external investment, the company shall dispatch a management team elected through legal procedures to play an important role in the operation and decision-making of the holding company.
Article 25 The nomination and appointment of directors or executive directors dispatched for external investment require the written consent of the general manager and chairman of the parent company.
When dispatched directors or executive directors express opinions on the nomination of the general manager of a holding subsidiary or the employment of senior management personnel such as general manager, deputy general manager, financial controller, etc., they must obtain the written opinions of the general manager and chairman of the parent company.
Article 26 The dispatched personnel shall effectively perform their duties in accordance with the provisions of the Company Law and the Articles of Association, safeguard the interests of the company in the operation and management activities of the newly-established company, and achieve the preservation and appreciation of the company's investment.
Article 27 The company shall organize the relevant departments to conduct annual and term assessments of the dispatched directors and supervisors. The company will give corresponding rewards or penalties to relevant personnel based on the assessment results.
Article 28 The company's board of directors should regularly understand the implementation progress and investment benefits of major investment projects. If there is failure to invest as planned, failure to realize project expected returns, investment losses, etc., the company's board of directors should identify the reasons and hold the relevant personnel accountable.
Chapter 4 Recovery and Transfer of Investments
Article 29 The company may withdraw its investment when one of the following circumstances occurs or occurs:
(1) According to the articles of association of the invested company, the operation period of the investment project has expired or the investment goal has been achieved;
(2) Due to poor management of the investment project, the company is unable to repay due debts and becomes bankrupt in accordance with the law;
(3) The project cannot continue to operate due to the occurrence of force majeure;
(4) When other circumstances stipulating the termination of investment appear or occur in the joint venture or cooperation contract.
Article 30 The company may transfer the investment when one of the following circumstances occurs or occurs:
(1) The investment project has obviously deviated from the company’s business direction;
(2) The investment project has suffered continuous losses with no hope of turning around the losses and has no market prospects;
(3) When there is an urgent need to supplement funds due to insufficient operating funds;
(4) Other circumstances deemed necessary by the company.
Article 31 Investment transfers shall be handled strictly in accordance with relevant national laws, regulations and company systems. The procedures and authority for approving the disposal of investments are the same as those for approving the implementation of investments.
Chapter 5 Supplementary Provisions
Article 32 The terms "above" and "below" in this system include the original number, and "less than", "lower than" and "exceeding" do not include the original number. The "year" referred to in this system is the accounting year.
Article 33 Matters not covered by this system shall be implemented in accordance with relevant national laws, regulations, "Listing Rules", "Articles of Association" and other normative documents. If this system conflicts with the relevant provisions of the relevant laws, regulations, the Listing Rules or the Articles of Association, the provisions of the relevant laws, regulations, the Listing Rules or the Articles of Association shall prevail.
Article 34 This system will take effect after being reviewed and approved by the shareholders' meeting, and the same applies when it is modified.
Article 35 The company’s board of directors is responsible for interpreting this system.