Pailin Biotechnology: Financing Management System

Shenzhen Stock Exchange

2025/12/05

Pailin Biotech Financing Management System

Pais Shuanglin Biopharmaceutical Co., Ltd.

Financing management system

Chapter 1 General Provisions

Chapter 2 Equity Capital Financing

Chapter 3 Debt Capital Financing

Chapter 4 Financing Risk Management

Chapter 5 Supplementary Provisions

Pailin Biotech Financing Management System

Chapter 1 General Provisions

Article 1 In order to further standardize the financing behavior of Pais Shuanglin Biopharmaceutical Co., Ltd. (hereinafter referred to as the "Company"), strengthen financing management and monitoring, reduce capital costs, reduce financing risks, and improve capital efficiency, in accordance with the Company Law of the People's Republic of China, the Securities Law of the People's Republic of China, the Stock Listing Rules of the Shenzhen Stock Exchange, and the Guidelines for Self-Discipline Supervision of Listed Companies of the Shenzhen Stock Exchange No. 1 No. - Standardized Operation of Main Board Listed Companies" and other laws and regulations, normative documents and the relevant provisions of the "Articles of Association", combined with the actual situation of the company, this system is specially formulated.

Article 2 This system applies to the financing activities of the company and its holding subsidiaries. The financing referred to in this system includes two methods: equity capital financing and debt capital financing.

Article 3 The company’s financing activities should be in line with the company’s strategic development plan, and factors such as financing costs, capital structure and debt solvency should be taken into consideration.

Article 4 The board of directors is uniformly responsible for the management, coordination and supervision of fund raising. The main business activities related to the company's issuance of stocks and bonds are coordinated by the company's board of directors office, strategic development department, and planning and finance department within their respective scopes of responsibility.

Chapter 2 Equity Capital Financing

Article 5 Equity capital financing refers to raising capital through the issuance of stocks, including allotment of shares, additional issuance, and non-public issuance of stocks.

Article 6 The company's financing plan for issuing shares shall be drafted by the Office of the Board of Directors, fully discussed by the Strategy Committee of the Board of Directors, and submitted to the Board of Directors and the shareholders' meeting for review and approval before implementation.

Article 7 The Office of the Board of Directors shall organize the relevant departments of the company to cooperate with intermediaries in the preparation of application documents for stock issuance. The preparation and application process of application documents shall be carried out in accordance with the requirements of relevant laws and regulations.

Chapter 3 Debt Capital Financing

Article 8 Debt capital financing refers to the company’s issuance of bonds and borrowing from banks and other financial institutions.

Article 9 The company's bond issuance plan shall be drafted by the board of directors' office. After full discussion by the board of directors' strategy committee, review and approval by the board of directors and shareholders' meeting, and obtaining approval documents from relevant government departments, the board of directors' office will organize relevant departments of the company to cooperate with intermediaries to carry out bond issuance work in accordance with relevant laws and regulations. The preparation and application process of relevant application documents shall be carried out in accordance with relevant laws and regulations and the requirements of the financing management system of Pailin Biotech of relevant regulatory authorities.

Article 10 Procedures for company borrowings (including long-term and short-term borrowings, etc.):

(1) The company’s planning and finance department submits an application based on the company’s operating conditions and funding needs;

(2) Perform the approval procedures in accordance with the provisions of the "Articles of Association" and "Subsidiary Management Measures";

(3) The company's planning and finance department is responsible for signing loan contracts and supervising the arrival and use of funds.

Article 11 When a company borrows money from banks and other financial institutions, it shall comply with the relevant regulations of the bank and the state, and the primary principle shall be to safeguard the interests of the company. The company's planning and finance department should designate a dedicated person to be responsible for the raising, utilization and repayment of principal and interest of funds, and handle the procedures for loan repayment and renewal declaration in a timely manner to avoid the occurrence of penalty interest, arrears of interest and delayed loan repayment.

Article 12 When a company borrows money from related parties, it shall comply with the company's "Related Transaction Management System" and other provisions.

Article 13 If the company's financing from banks or other financial institutions involves providing guarantees, it shall comply with the provisions of the company's "External Guarantee Management System".

Chapter 4 Financing Risk Management

Article 14 The company's planning and finance department will evaluate the company's financing risks and submit them to the strategy committee of the board of directors for discussion. Evaluation principles for financing risks:

(1) Determine the timing, scale and combination of financing based on the needs of fixed asset investment and working capital;

(2) Fully consider the company's repayment ability, comprehensively measure the income and repayment ability, and act within its capabilities;

(3) Have the ability to absorb and digest the funds, assets, and technologies raised;

(4) The period of financing must be appropriate;

(5) The debt ratio and debt repayment ratio must be controlled within a certain range;

(6) Tax exemptions and social conditions must be considered when raising funds.

Article 15 Financing costs are the decisive factor that determines the company's financing efficiency and are of great significance for the selection and evaluation of financing methods. The Planning and Finance Department should use the financing portfolio with the smallest weighted average capital cost to evaluate the company's capital costs to determine a reasonable capital structure.

Article 16 After the funds raised are in place, the Planning and Finance Department must effectively control and supervise the entire process of using the funds raised. The funds raised must be used strictly according to the purposes and budgets proposed in the financing plan. If it is really necessary to change the use of funds, the use of the funds must be approved in advance by the competent authority before the use of the funds can be changed.

Article 17 The company's planning and finance department shall, in accordance with the provisions of the relevant accounting system, set up accounting accounts for accounting of financing business, conduct accounting and supervise the financing business.

Article 18 The Planning and Finance Department shall reasonably plan the repayment period of the loan and the source of funds to repay the loan based on the company's operating conditions, cash flow and other factors.

Article 19 The deposit and use of funds raised by a company for specific purposes through the issuance of stocks, bonds, etc. shall be strictly in accordance with the relevant provisions of the "Raised Funds Management System".

Article 20 The Audit Department shall conduct internal audits of the company's financing business in accordance with the arrangements of the Audit Committee of the Board of Directors, and strengthen the review of the authenticity, legality, accuracy and completeness of various original vouchers involved in all aspects of the financing business.

Article 21 If weak links in the internal control of financing activities are discovered during the supervision and inspection process, relevant departments should be required to strengthen and improve them. If major problems are discovered, a written report should be submitted and promptly reported to the audit committee of the company's board of directors and the board of directors.

Chapter 5 Supplementary Provisions

Article 22 If the content that is not stipulated in this system or is inconsistent with the content stipulated in relevant laws, administrative regulations, normative documents and the "Articles of Association", the provisions of the relevant laws, administrative regulations, normative documents and the "Articles of Association" shall prevail.

Article 23 The company’s board of directors is responsible for interpreting this system.

Article 24 This system will be implemented from the date of review and approval by the board of directors.