Subsidiary management system

Jiangsu Kangwei Century Biotechnology Co., Ltd.

Chapter 1 General Provisions

Article 1 In order to strengthen the internal control of Jiangsu Kangwei Century Biotechnology Co., Ltd. (hereinafter referred to as the "Company"), promote the company's standardized operation and healthy development, protect the legitimate rights and interests of investors, strengthen the management control of subsidiaries, standardize the behavior of subsidiaries, and ensure the standardized operation and legal operation of subsidiaries, in accordance with the "Company Law of the People's Republic of China", "Securities Law of the People's Republic of China", "Shanghai Stock Exchange Science and Technology Innovation Board Stock Listing Rules", "Shanghai Stock Exchange Science and Technology Innovation Board Listed Companies Self-Discipline Supervision Guidelines No. 1" No. - Standardized Operations" and other laws, regulations and normative documents, as well as the relevant provisions of the "Articles of Association of Jiangsu Kangwei Century Biotechnology Co., Ltd." (hereinafter referred to as the "Articles of Association"), and combined with the actual situation of the company, this system is formulated.

Article 2 This system applies to: (1) Wholly-owned subsidiaries refer to subsidiaries in which the company directly or indirectly holds 100% of the equity or shares. (2) A controlled subsidiary refers to a company with independent legal personality that the company holds more than 50% of its equity, or holds less than 50% of its equity but can decide the election of more than half of its board of directors, or can actually control it through an agreement or other arrangement, including domestic subsidiaries and overseas subsidiaries established in accordance with the laws of the country/region where it is located.

Article 3 Each subsidiary shall abide by this system and, in conjunction with the company's relevant internal control regulations, formulate specific implementation rules based on its own operating characteristics to ensure the implementation and execution of this system. All functional departments of the company should provide timely services, guidance, and supervision to subsidiaries in accordance with relevant internal control systems.

Article 4 If a company's subsidiaries simultaneously control other companies, they shall establish a management system for their subordinate subsidiaries layer by layer with reference to the requirements of this system and accept the supervision of the company.

Chapter 2 Governance Structure

Article 5 As an investor, the company, as a shareholder or controller, exercises the supervision and management of major matters of its subsidiaries in accordance with the requirements of laws, regulations and the Articles of Association for the company's standardized operations and corporate governance structure, and enjoys the power to invest in investment income and make decisions on major matters in accordance with the law. Each subsidiary must comply with the company's relevant regulations.

Article 6 The company shall conduct unified management of its subsidiaries and establish an effective management process system. All functional departments of the company shall, in accordance with this system and relevant internal control systems, promptly and effectively manage, guide and supervise the subsidiaries, so as to implement effective supervision in aspects such as finance, human resources, and corporate operation and management.

Article 7 Subsidiaries are established in accordance with the law in accordance with the company's overall strategic planning and business development needs. They have independent legal entities, each of which is responsible for specific production operations or other tasks, and has an investor-invested, management-managed relationship with the company.

Article 8 Subsidiaries should establish corresponding business plans, risk management procedures and internal control systems based on the company's business strategies and risk management policies.

Article 9 Subsidiaries should improve their corporate governance structure in strict accordance with relevant laws and regulations, ensure that their shareholders' meeting, board of directors, and board of supervisors can operate legally and effectively, make scientific decisions, have risk prevention awareness, and cultivate a corporate governance structure suitable for the healthy development of the enterprise.

The subsidiary shall establish a major event reporting system and review procedures, promptly report major business matters, major financial matters, and other information that may have a greater impact on the trading prices of listed company securities and derivatives to the person in charge of the company, and report major matters to the company's board secretary for review and the board of directors or shareholders' meeting for review.

Article 10 Major matters include but are not limited to development plans and budgets, major investments, acquisition and sale of assets, provision of financial assistance, provision of guarantees for others, investment in securities and financial derivatives, signing of major contracts, foreign exchange risk management of overseas subsidiaries, etc.

Article 11 The articles of association of a subsidiary shall be formulated by the company in consultation with other shareholders in accordance with laws and regulations, and its main provisions shall be drafted by the company or confirmed by the company.

Article 12 The authority of a subsidiary company is the shareholders' meeting. When a subsidiary holds a shareholders' meeting, designated persons authorized by the company will attend the meeting as shareholder representatives and exercise voting rights in accordance with the law. After the meeting, the shareholder representatives will report the relevant information of the meeting to the company's chairman or general manager.

The authority of a wholly-owned subsidiary is the shareholder, that is, the company. The company exercises shareholders' decision-making power on major matters in accordance with relevant laws, regulations and the articles of association of its wholly-owned subsidiaries.

Article 13 A subsidiary shall have a board of directors or executive director, a board of supervisors or supervisors, and a management team, which shall appoint, remove and exercise powers in accordance with the provisions of laws, regulations and the subsidiary's articles of association.

Article 14 The company shall implement the governance and monitoring of its subsidiaries through the appointment of directors, supervisors, general managers, deputy general managers, financial directors and other senior management personnel and information reporting.

Directors, supervisors and senior managers appointed by the company are nominated and recommended according to the company's cadre appointment and removal procedures, and elected or appointed by the subsidiary's shareholders' meeting and board of directors. The company has the right to appoint directors and supervisors to the subsidiary to form its board of directors and supervisory board in proportion to its capital contribution.

In principle, the chairman or executive director, general manager, and financial director of a subsidiary shall be persons recommended by the company, and shall accept the guidance and supervision of the company.

The dispatched directors, supervisors and senior managers shall be current employees of the company, and their terms of office shall be stipulated in the subsidiary's articles of association.

Article 15 If a subsidiary holds a board of directors, shareholders' meeting or other major meeting, the meeting notice and topics must be submitted to the company's board secretary and general manager 10 days before the meeting. The secretary of the board of directors shall review whether it needs to be reviewed and approved by the general manager of the company, the board of directors or the shareholders' meeting.

Article 16 Responsibilities of dispatched directors and supervisors

Directors and supervisors dispatched by the company to subsidiaries should fulfill their duties, be responsible to the shareholders' meeting of the subsidiary, and safeguard the interests of the company. In addition to performing the duties conferred by laws, regulations and the articles of association of the subsidiary, their work content and requirements are as follows:

(1) Understand the production and operation of subsidiaries and actively participate in the operation and management of subsidiaries;

(2) Attend the board of directors and board of supervisors of the subsidiary in person. If you are indeed unable to attend, you must discuss the proposed matters.

The item entrusts other directors and supervisors in writing to vote on their behalf;

(3) Through the subsidiary’s board of directors and board of supervisors, implement the company’s major operating decisions on the subsidiary,

Personnel appointment and removal plans;

(4) Report major information about subsidiaries to the company in a timely manner;

(5) Full-time directors, under the leadership of the company’s board of directors and general manager, fully represent the company in participating in the affairs of subsidiaries

Make business decisions and conduct comprehensive management of subsidiaries;

(6) Part-time directors and supervisors do not receive any remuneration from the subsidiary and will be given certain rewards based on their work status and performance at the end of the year. Relevant expenses incurred by part-time directors and supervisors for the company shall be determined by

The company reimburses actual expenses and records them as the cost of the subsidiary.

Article 17 Responsibilities of dispatched managers

(1) Represent the company in the business decision-making and internal management of subsidiaries, and exercise their positions in subsidiaries

position responsibilities;

(2) Implement the business plan and investment plan formulated by the shareholder meeting and board of directors of the subsidiary;

(3) Report the business operations of the subsidiary to the board of directors and supervisory board of the subsidiary;

(4) Implement the rules and regulations formulated by the company;

(5) Regularly report on work to the general manager of the company.

Article 18 Responsibilities of dispatched financial director

The appointed financial director enters the subsidiary management, performs the functions of the financial director, and accepts business management, supervision and guidance from the company's financial management center. Mainly responsible for and involved in the following work:

(1) Assist the general manager to participate in the daily decision-making and management of subsidiaries;

(2) Implement the company’s financial goals, financial management policies, and financial management systems;

(3) Carry out necessary supervision and control over the investment and operation of its subsidiaries;

(4) Responsible for establishing and improving various financial control systems of subsidiaries;

(5) The appointment, promotion and dismissal of personnel above the financial director level of a subsidiary must be reported to the company's financial management center for approval and filing.

Chapter 3 Operation and Management

Article 19 The actual business operations of subsidiaries must be carried out strictly in accordance with the business scope approved by the company, and shall not operate beyond their authority.

Article 20 The important rules and regulations formulated by a subsidiary shall not conflict with the corresponding rules and regulations of the company. Before reviewing the rules and regulations, the opinions of the relevant functional departments of the company shall be solicited and reported to the relevant departments of the company for filing within 5 working days after the rules and regulations take effect.

Article 21 Subsidiaries shall provide the company with business reports, financial statements, statistical statements and other written forms in a timely manner

business performance, financial status and other information to facilitate the company’s scientific decision-making, supervision and coordination.

Article 22 The general manager, financial director and statement preparer of the subsidiary shall sign and confirm the submitted financial statements.

Responsible for the authenticity, accuracy and completeness of financial statements.

Article 23 In order to implement the company's brand strategy, in principle, all subsidiaries should use the company's trademarks. The company grants trademark licenses to subsidiaries, but the subsidiaries should ensure the quality of their products and services.

While maintaining the company's brand image.

Article 24 Subsidiaries do not have the right to invest externally. The subsidiaries may invest based on their own business formats and the market environment of the region in which they are located.

Propose investment plans to the company's competent authorities in accordance with the company's investment decision-making management related systems.

Article 25 A subsidiary has no external guarantee rights. If it is necessary to provide guarantees for other enterprises due to special circumstances, it must be reported to the company's competent department and relevant legal procedures must be fulfilled before proceeding.

Chapter 4 Financial Management

Article 26 The subsidiary company and the company shall implement a unified accounting system. The financial management of subsidiaries implements unified coordination and hierarchical management. The company's financial management center provides guidance and supervision on the accounting and financial management of subsidiaries.

Governor.

Article 27 Subsidiaries shall submit a monthly report for the current month, including assets, to the company’s financial management center within five days after the end of each month.

Liability sheet, cash flow statement, income statement, etc.; submit quarterly reports to the company within ten days after the end of each quarter.

Article 28 Subsidiary projects under construction and external investment projects under implementation shall report their implementation progress to the company's financial management center regularly on a quarterly, semi-annual, and annual basis. After the project is put into operation, the operation status shall be collected on a quarterly, semi-annual, and annual basis, and the status shall be submitted in writing to the company's financial management center within ten days after the end of the accounting period.

Report.

Article 29 Subsidiaries shall prepare consolidated accounting statements and disclose financial accounting information to the outside world in accordance with the company’s requirements.

and the company's financial department's requirements for submission content and time, submit financial statements and provide accounting information in a timely manner

According to the information, its financial statements are also audited by certified public accountants entrusted by the company.

Article 30 Subsidiaries are not allowed to conceal their income and profits during business activities, or to set up off-the-books accounts and small treasury privately.

Chapter 5 Related Transaction System

Article 31 When any transaction occurs in a subsidiary, it should carefully check whether the counterparty is a related party of the company, and prudently determine whether it constitutes a related transaction. If it constitutes a related transaction, it should be reported to the company's financial management center in a timely manner and the relevant

Approval and reporting obligations accordingly.

Article 32 Contracts shall be concluded in accordance with the law for the economic business between the company and its subsidiaries and between subsidiaries.

Article 33 The settlement price involved in related transactions shall be reasonably determined based on market fairness and on the basis of equality, mutual benefit and equivalent exchange. Both parties cannot require one party to make concessions or increase the settlement price because of the existence of a parent-subsidiary relationship or the control of the same parent company.

Chapter 6 Audit Supervision

Article 34 The company shall conduct regular or irregular audit supervision on the operations of its subsidiaries. The company's internal audit institution should

Inspect and evaluate the completeness, rationality and effectiveness of the internal control system of the subsidiary.

Article 35 The audit content mainly includes: auditing the legality, compliance, authenticity and completeness of accounting data and other relevant economic data, as well as the reflected financial revenues and expenditures and related economic activities, including but not limited to

In financial reports, performance forecasts, performance bulletins, voluntary disclosure of predictive financial information, etc.

Article 36 After receiving the audit notice, the subsidiary shall be prepared to be audited and verify the authenticity of the information provided.

Responsible for authenticity, accuracy and completeness, and provide active cooperation during the audit process.

Article 37 After the audit opinions and audit decisions approved by the company are delivered to the subsidiary, the subsidiary must implement them conscientiously.

Chapter 7 Assessment, Rewards and Punishments

Article 38 The company shall, based on the scale of assets occupied by its subsidiaries and the economic benefits achieved, combined with the provisions of this system, and

Conduct assessments with reference to the company's remuneration management methods, and implement rewards and punishments for the main persons in charge of subsidiaries.

Article 39 The directors, supervisors and senior managers assigned by the company to subsidiaries shall

Within the company, make a performance report for the previous year to the company.

Article 40 A subsidiary shall, after the end of each fiscal year, evaluate directors, supervisors and senior managers based on the completion of the subsidiary's annual business objectives and the performance of directors, supervisors and senior managers.

And implement rewards and punishments based on the assessment results.

Article 41 Subsidiaries may, based on their own circumstances and in conjunction with the company's assessment, rewards, punishments and salary management systems, establish an assessment, rewards, punishments and salary management system suitable for the actual conditions of the subsidiary, so as to fully mobilize the enthusiasm and enthusiasm of the management and all employees.

Be creative and form a fair and reasonable competition mechanism.

Article 42 The assessment, rewards, punishments and salary management system of the subsidiary shall be submitted to the company for filing after approval by the chairman of the subsidiary.

Article 43 If the directors, supervisors and senior managers of a subsidiary fail to perform their corresponding responsibilities and obligations, causing adverse effects or significant losses to the company or the subsidiary's business activities and economic interests, the subsidiary shall comply with regulations.

The parties concerned shall be punished accordingly.

Article 44 If the company deems that senior managers who are not dispatched to subsidiaries by the company are not qualified for the position, they may propose their replacement to the board of directors of the subsidiary.

Chapter 8 Supplementary Provisions

Article 45 The term "above" in this system includes the original number, and the term "more than" does not include the original number.

Article 46 This system shall take effect and be implemented from the date of approval by the board of directors, and the same shall apply when it is modified.

Article 47 Matters not covered in this system shall be implemented in accordance with relevant national laws, regulations and the "Articles of Association"; if the relevant provisions of this system conflict with relevant laws and regulations promulgated or modified in the future, the current "Articles of Association", and the "Articles of Association" revised in accordance with legal procedures, the relevant provisions of this system shall be governed by the relevant laws and regulations, the current "Articles of Association"

The provisions of the Articles of Association or the revised Articles of Association shall be implemented.

Article 48 This system is formulated and interpreted by the company’s board of directors.