/Jinhe Biotech: Draft 2026 Employee Stock Ownership Plan

NEWS

Jinhe Biotech: Draft 2026 Employee Stock Ownership Plan

Shenzhen Stock Exchange

2026/04/29

Jinhe Biotechnology Co., Ltd. 2026 Employee Stock Ownership Plan (Draft)

April 2026

Statement

The company and all members of the board of directors guarantee that the content of this employee stock ownership plan is true, accurate and complete, and that there are no false records, misleading statements or major omissions, and bear individual and joint legal liability for the authenticity, accuracy and completeness of its content.

Risk warning

The 2026 employee stock ownership plan of Jinhe Biotechnology Co., Ltd. (hereinafter referred to as the "Company") must be approved by the company's shareholders' meeting before it can be implemented. There is uncertainty whether this employee stock ownership plan can be approved by the company's shareholders' meeting;
The specific number of participants, capital scale, stock size, implementation plan, etc. of the employee stock ownership plan are preliminary results, and there is uncertainty as to whether the implementation can be completed;
If the employee subscription funds are low, there is a risk that the employee stock ownership plan will not be established; if the employee subscription shares are insufficient, there is a risk that the employee stock ownership plan will be lower than the expected scale;
The company will subsequently disclose relevant progress in accordance with regulations. Investors are advised to make prudent decisions and pay attention to investment risks.

Special reminder

The abbreviations of words in this section are consistent with those in the "Definitions" section.

The 2026 Employee Stock Ownership Plan of Jinhe Biotechnology Co., Ltd. is formulated in accordance with the provisions of the Company Law of the People's Republic of China, the Securities Law of the People's Republic of China, the Guiding Opinions on the Pilot Implementation of Employee Stock Ownership Plans by Listed Companies, and the Shenzhen Stock Exchange Self-Regulatory Guidelines for Listed Companies No. 1 - Standardized Operation of Main Board Listed Companies and other relevant laws, administrative regulations, rules, normative documents and the Articles of Association.
This Employee Stock Ownership Plan follows the principles of legal compliance, voluntary participation, and own risk. There are no apportionments, forced distributions, etc. that force employees to participate in the Employee Stock Ownership Plan.
Participants in this employee stock ownership plan are some directors (excluding independent directors) and senior managers of the company (including branches and subsidiaries), as well as core employees who have a direct impact on the operating performance and sustainable development of the listed company. There are no shareholders, controlling shareholders, and persons acting in concert or actual controllers who hold more than 5% of the company's shares, as well as their spouses, parents, and children. The total number of holders shall not exceed 384. The specific number and list of participants will be determined based on the actual payment status of employees.
The sources of funds for this employee stock ownership plan are employees’ legal remuneration, self-raised funds and other methods permitted by laws and regulations. The company does not provide financial assistance such as advances, guarantees, or loans to holders. There is no situation in this employee stock ownership plan where a third party provides incentives, funding, insurance, subsidies and other arrangements for employees to participate in the stock ownership plan. The total amount of funds planned to be raised under this employee stock ownership plan is capped at RMB 24,872,263.3, with “shares” as the subscription units, and each share is RMB 1.00. The specific share is determined based on the actual capital contribution amount.
The employee stock ownership plan acquires the repurchased A shares of Jinhe Biotechnology from the company’s special repurchase securities account through non-transaction transfer and other methods recognized by laws and regulations. The scale does not exceed 7,946,410 shares, accounting for 1.0327% of the company’s current total share capital. The final number of shares held is determined based on the holder’s actual capital contribution and payment.

After the implementation of this employee stock ownership plan, the total number of stocks held by all valid employee stock ownership plans of the company shall not exceed 10% of the company's total share capital, and the total number of stocks corresponding to the share rights received by a single employee shall not exceed 1% of the company's total share capital. The total number of shares held by the employee stock ownership plan does not include shares acquired by employees before the company’s initial public offering of A shares, shares purchased by themselves through the secondary market, and shares obtained through equity incentives.

The price for repurchasing shares under this employee stock ownership plan is 3.13 yuan/share. During the period from the announcement date of the Employee Stock Ownership Plan to the completion of the repurchase and transfer of shares under the Employee Stock Ownership Plan, if the company undergoes ex-rights and ex-dividend events such as capitalization of capital reserves, bonus shares, dividends, stock splits, share reductions, etc., the price of the underlying stock will be adjusted accordingly.
The duration of the employee stock ownership plan is 24 months, and the lock-up period for the company shares acquired is 12 months, calculated from the date when the draft of the employee stock ownership plan is reviewed and approved by the company’s shareholders’ meeting and the company announces the transfer of the last company stock to the name of the employee stock ownership plan. Before the expiration of the duration of the employee stock ownership plan, the duration of the employee stock ownership plan can be extended with the consent of more than 2/3 (inclusive) of the shares held by the holders attending the holders' meeting and submission to the company's board of directors for review and approval.
After the establishment of this employee stock ownership plan, it will be managed by the company itself. The highest internal management authority of this employee stock ownership plan is the holders' meeting. The holders' meeting sets up a management committee and authorizes the management committee to serve as the management organization of the employee stock ownership plan, supervise the daily management of the employee stock ownership plan, and exercise shareholder rights on behalf of the holders. The Management Committee manages the assets of the Employee Stock Ownership Plan in accordance with laws, administrative regulations, departmental rules, normative documents, securities regulatory agencies and the provisions of the Employee Stock Ownership Plan, safeguards the legitimate rights and interests of holders of the Employee Stock Ownership Plan, ensures the safety of the assets of the Employee Stock Ownership Plan, and avoids potential conflicts of interest between other shareholders of the company and holders of the Employee Stock Ownership Plan.

This employee stock ownership plan plan and the corresponding employee stock ownership plan management measures clearly stipulate the rights and obligations of the management committee, and the risk prevention and isolation measures are sufficient.

The company’s financial, accounting, taxation and other matters regarding the implementation of the employee stock ownership plan shall be implemented in accordance with the relevant financial systems, accounting standards, and taxation systems. The relevant taxes and fees that employees need to pay due to the implementation of the employee stock ownership plan shall be borne by the employees themselves.
Before the company implements the employee stock ownership plan, it will solicit employees' opinions through the employee representative meeting; after the board of directors considers and approves the employee stock ownership plan, the company will issue a notice of convening a shareholders' meeting to review the employee stock ownership plan. The Remuneration and Appraisal Committee of the Board of Directors issued clear opinions on this employee stock ownership plan. This employee stock ownership plan must be reviewed and approved by the company's shareholders' meeting before it can be implemented.
The directors and senior managers of the company who participate in the employee stock ownership plan do not hold any positions on the management committee. The employee stock ownership plan remains independent from the controlling shareholders, actual controllers, directors and senior managers in terms of relevant operations and other matters. There is no concerted action relationship between this employee stock ownership plan and the company’s controlling shareholders, actual controllers, company directors, and senior managers.
After the implementation of this employee stock ownership plan, it will not cause the company’s equity distribution to fail to meet the listing conditions.

Chapter 1 General Provisions

This employee stock ownership plan is formulated in accordance with the Company Law, Securities Law, Guiding Opinions, Self-Regulatory Guidelines and other laws, regulations, normative documents and the Articles of Association. It follows the principles of fairness, justice and openness and aims to improve the company's corporate governance structure, establish and improve the benefit-sharing mechanism between workers and owners, improve employee cohesion and company competitiveness, and ensure the realization of the company's future development strategy and business objectives.

1. The purpose of this employee stock ownership plan

(1) Establish a sharing mechanism

Establish a benefit-sharing mechanism between workers and owners to achieve consistency in the interests of the company, shareholders and employees, and promote all parties to pay attention to the company's long-term development, thereby bringing more efficient and lasting returns to shareholders.

(2) Improve corporate governance structure

Further improve the corporate governance structure, improve the company's long-term and effective incentive and restraint mechanism, and ensure the company's long-term and stable development.

(3) Improve the incentive system

Deepen the company's incentive system, advocate the sustainable development of the company and its employees, fully mobilize the enthusiasm and creativity of employees, attract and retain outstanding management talents and business backbones, and improve the cohesion of the company's employees and the company's competitiveness.

2. Basic principles followed by this employee stock ownership plan

(1) Principles of legal compliance

The company implements an employee stock ownership plan, strictly implements procedures in accordance with laws and administrative regulations, and implements information disclosure in a true, accurate, complete and timely manner. No one may use the employee stock ownership plan to engage in insider trading, manipulation of the securities market and other securities fraud.

(2) Principle of voluntary participation

The company's implementation of the employee stock ownership plan follows the company's independent decision and employees participate voluntarily. The company does not force employees to participate in the employee stock ownership plan through apportionment, forced distribution, etc.

(3) Principle of own risk

Employee stock ownership plan holders are responsible for their own profits and losses, bear their own risks, and have equal rights and interests with other investors.

Chapter 2 Holders of the Employee Stock Ownership Plan

1. Determination basis and scope of holders of this employee stock ownership plan

(1) Basis for determining the holders of the stock ownership plan

The holders of this employee stock ownership plan are determined in accordance with relevant laws, regulations, normative documents such as the Company Law, Securities Law, Guiding Opinions, Self-Regulatory Guidelines, and the Articles of Association. The company's employees participate in this employee stock ownership plan in accordance with the principles of legal compliance, voluntary participation, and self-risk.

(2) Scope of holders of this employee stock ownership plan

The scope of persons participating in this employee stock ownership plan includes some directors (excluding independent directors) and senior managers of the company (including branches and subsidiaries), as well as core employees who have a direct impact on the operating performance and sustainable development of the listed company. There are no shareholders, controlling shareholders, and persons acting in concert or actual controllers who hold more than 5% of the company's shares, as well as their spouses, parents, and children. Except as otherwise provided in "Chapter 7 Disposal of Employee Stock Ownership Plan Holders' Rights and Interests" of this Employee Stock Ownership Plan, all participants in this Employee Stock Ownership Plan have labor or employment relationships with the company or branches or subsidiaries of the company.

(3) Anyone who has any of the following circumstances cannot become a participant:

Those who have been publicly condemned or declared as unsuitable candidates by regulatory agencies in the past three years;
Administrative penalties imposed by regulatory agencies due to major violations of laws and regulations in the past three years;
In the past three years, any behavior that violates national laws and regulations, such as leaking state or company secrets, embezzlement, theft, embezzlement, bribery, dereliction of duty or dereliction of duty, or behavior that violates public order and good customs, professional ethics and ethics has caused serious damage to the company's interests, reputation and image;
The company’s board of directors determines that the company cannot become a participant in this plan;
Other circumstances that prevent you from becoming a participant in this plan as stipulated in relevant laws, regulations or normative documents.

2. List of holders and share allocation of this employee stock ownership plan

This employee stock ownership plan uses "shares" as the holding unit, each share is 1.00 yuan, and the total amount of funds to be raised is capped at 24,872,263.3 yuan. The specific share holdings shall be subject to the final confirmed payment amount of the holder.

The total number of holders of this employee stock ownership plan shall not exceed 384, including 9 directors and senior managers of listed companies who intend to participate in the subscription of the employee stock ownership plan. The final number and list of participants will be determined based on the actual contributions of employees. The list of holders and the distribution of shares are as shown in the table below. The final shares held by each holder shall be subject to the agreement in the employee stock ownership plan subscription agreement signed by them:

Accounted for the total number of employee stock ownership plans

Maximum subscription share

Serial number Name Position Proportion of share (10,000 copies)

(%)

1 Li Fuzhong Vice Chairman 15.65 0.63%

2 Xie Changxian Director, General Manager 15.65 0.63%

3 Wang Yueqing Employee Director 14.085 0.57%

4 Niu Youshan Financial Director 14.085 0.57%

5 Mingsheng Suga Deputy General Manager 10.955 0.44%

6 Guan Yingzhen Deputy General Manager 10.955 0.44%

7 Liu Yingchun Deputy General Manager 34.43 1.38%

8 Yun Xibao Deputy General Manager 12.52 0.50%

9 Guo Shengmin Deputy General Manager 37.56 1.51%

Total directors and senior managers 165.89 6.67%

Total core employees 2321.33633 93.33%

Total 2487.22633 100.00%

Note: The scope of persons participating in this employee stock ownership plan is some directors (not directors) of the company (including branches and subsidiaries)

Including independent directors), senior managers, and core employees who have a direct impact on the operating performance and sustainable development of listed companies,

There are no shareholders, controlling shareholders, persons acting in concert or actual controllers who hold more than 5% of the company's shares, their spouses, parents,

children.

If the holder's subscription funds are not paid on time and in full, the corresponding subscription rights will be automatically lost.

The number of shares to be subscribed can be applied for by other qualified participants, and the management committee can decide according to the actual conditions of the employees.

The list of participants and the number of subscribed shares will be adjusted according to the actual payment situation.

The lawyer hired by the company will check whether the qualifications of the holder and other conditions are in compliance with the Company Law, Securities Law and Guidance.

"Opinions", "Self-Regulatory Supervision Guidelines" and other relevant laws and regulations, the "Articles of Association" and the relevant aspects of this draft plan

Provide clear opinions.

Chapter 3 Funding Sources and Stock Sources of Employee Stock Ownership Plans

1. Source of funds for this employee stock ownership plan

The sources of funds for this employee stock ownership plan are employees' legal remuneration, self-raised funds and other methods permitted by laws and regulations. The company does not provide financial assistance such as advances, guarantees, or loans to holders. There is no situation in this employee stock ownership plan where a third party provides incentives, funding, insurance, subsidies and other arrangements for employees to participate in the stock ownership plan.

The total amount of funds to be raised under this employee stock ownership plan is capped at RMB 24,872,263.3, with “shares” as the subscription units, and each share is RMB 1.00. The specific share is determined based on the actual capital contribution amount.

The final number of employees participating in the employee stock ownership plan and the subscription amount are determined based on the actual contributions of employees. If the holder fails to pay the subscription funds on time and in full, it will be deemed to have automatically given up the corresponding subscription rights. The management committee can adjust the list of participants and their subscription shares based on the actual payment status of employees.

2. Source of shares of this employee stock ownership plan

The sources of stocks for this employee stock ownership plan are the common shares of Jinhe Biotech A shares that have been repurchased in the company's special repurchase securities account. After the employee stock ownership plan is approved by the shareholders' meeting, the company's shares held by the company's special repurchase securities account will be obtained through non-trading transfers and other methods permitted by laws and regulations. The company's repurchase of shares in the company's special repurchase securities account is as follows:

The company held the 11th meeting of the sixth board of directors on February 5, 2024, and reviewed and approved the "Proposal on the Plan to Repurchase Part of Public Shares", agreeing that the company will use self-raised funds to repurchase some public shares in a centralized bidding transaction for the implementation of equity incentives or employee stock ownership plans.

The company disclosed the "Announcement on the Results of Share Repurchase and Changes in Shares" on October 12, 2024. As of October 10, 2024, the company has repurchased a total of 15,221,500 shares, accounting for 1.97% of the company's current total share capital. The highest transaction price is 5.16 yuan/share, the lowest transaction price is 2.92 yuan/share, and the total transaction amount is 50,098,780.21 yuan (excluding transaction fees). The amount of this repurchase has reached the lower limit of the total repurchase funds in the repurchase plan, and does not exceed the upper limit of the total repurchase funds. The implementation of this repurchase plan has been completed.

This employee stock ownership plan plans to use the shares repurchased by the company in 2024, totaling 7,946,410 shares, accounting for approximately 1.0327% of the company’s total share capital of 769,504,398 shares on the announcement date of the employee stock ownership plan. After the employee stock ownership plan is approved by the shareholders' meeting, the employee stock ownership plan will obtain the shares repurchased by the company through non-trading transfers and other methods permitted by laws and regulations.

3. Purchase stock price

(1) Purchase price

After the employee stock ownership plan is reviewed and approved by the company's shareholders' meeting, it is planned to transfer the shares repurchased by the company through non-transaction transfer and other methods permitted by laws and regulations. The purchase price is 3.13 yuan/share.

(2) Method of determining purchase price

The price at which the transferee company of this employee stock ownership plan repurchases shares in the special securities account shall not be lower than the par value of the company's shares, and shall not be lower than the higher of the following prices:

The average trading price of the company’s stock on the 1 trading day before the announcement of the draft employee stock ownership plan (total stock trading volume on the previous trading day/total stock trading volume on the previous trading day) was 50% of 5.84 yuan per share, which was 2.92 yuan per share;
One of the following prices:

① The average trading price of the company’s stock in the 20 trading days before the announcement of the draft employee stock ownership plan (total stock trading volume in the previous 20 trading days/total stock trading volume in the previous 20 trading days) was 50% of 5.97 yuan per share, which was 2.99 yuan per share;

② The average stock trading price of the company in the 60 trading days before the announcement of the draft employee stock ownership plan (total stock trading volume in the previous 60 trading days/total stock trading volume in the previous 60 trading days) was 50% of 6.24 yuan per share, which was 3.12 yuan per share;

③The average stock trading price of the company in the 120 trading days before the announcement of the draft employee stock ownership plan (total stock trading volume in the previous 120 trading days/total stock trading volume in the previous 120 trading days) was 50% of 6.22 yuan per share, which was 3.11 yuan per share.

Before the employee stock ownership plan purchases the company's repurchased shares and completes the non-trading transfer, if the company converts capital reserves into equity, distributes stocks or cash dividends, splits stocks, shrinks shares, etc., the company's board of directors may decide whether to make corresponding adjustments to the price of the underlying stock.

Convert capital reserves to share capital, distribute stock dividends, and split shares

P＝P÷（1＋n）

Among them: P is the initial purchase price before adjustment; n is the ratio of converting capital reserves into equity per share, distributing stock dividends, and splitting shares; P is the initial purchase price after adjustment.

Allotment of shares

P＝P×（P＋P×n）/[P×（1＋n）]

0 1 2 1

Among them: P is the initial purchase price before adjustment; P is the closing price on the equity registration date; P is the allotment

0 1 2

share price; n is the proportion of the allotment (that is, the ratio of the number of shares in the allotment to the total share capital of the company before the allotment); P is the adjusted initial purchase price.

Stock reduction

P＝P÷n

Among them: P is the initial purchase price before adjustment; n is the reduction ratio; P is the initial purchase price after adjustment.

Dividend payment

P=P-V

Among them: P is the initial purchase price before adjustment; V is the dividend amount per share; P is the initial purchase price after adjustment.

Additional issuance

When the company issues new shares, the initial purchase price of the underlying stock will not be adjusted.

(3) Reasonable explanation

The purchase price and pricing method of this employee stock ownership plan are designed to establish and continuously improve the benefit sharing and co-construction mechanism between workers and owners, achieve the consistency of the interests of the company, shareholders and employees, further establish and improve the company's long-term incentive mechanism, enhance the cohesion of employees and the company's core competitiveness, which is conducive to fully and effectively mobilizing the initiative, enthusiasm and creativity of the holders, guiding the holders to continue to work together for the long-term development of the company, and ultimately promote the realization of the company's overall strategic goals.

4. Stock size of this employee stock ownership plan

This employee stock ownership plan obtains the repurchased A shares of Jinhe Biologics ordinary shares from the company's special repurchase securities account through non-trading transfers and other methods recognized by laws and regulations. The scale does not exceed 7,946,410 shares, accounting for 1.0327% of the company's current total share capital. The final number of shares held is determined based on the holder’s actual capital contribution and payment.

If the company's stock undergoes ex-rights and ex-dividend events such as dividend distribution, bonus shares, capital reserve conversion to share capital, etc. between the announcement date of the above-mentioned shareholders' meeting resolution and the purchase date, the number and scale of the above-mentioned underlying stocks will be adjusted accordingly.

Chapter 4 Duration, Lock-up Period, Transaction Restrictions and Performance Appraisal of the Employee Stock Ownership Plan

1. Duration of employee stock ownership plan

The duration of the employee stock ownership plan is 24 months, calculated from the date when the draft of the employee stock ownership plan is reviewed and approved by the company's shareholders' meeting and the company announces the transfer of the last company stock to the name of the employee stock ownership plan. This employee stock ownership plan will terminate automatically if it is not extended at the expiration of the duration.
After the lock-in period of the employee stock ownership plan expires, when the assets held are monetary assets, the employee stock ownership plan can be terminated early upon a decision made by the management committee.
Before the expiration of the duration of the employee stock ownership plan, the duration of the employee stock ownership plan can be extended with the consent of more than 2/3 (inclusive) of the shares held by the holders attending the holders' meeting and submission to the company's board of directors for review and approval.
If relevant laws, administrative regulations, departmental rules, and normative documents impose restrictions on the transfer of underlying stocks, resulting in the inability of the underlying stocks to be fully liquidated before the expiration of the duration of the employee stock ownership plan, or if the underlying stocks are not fully realized before the expiration of the duration due to insufficient stock liquidity or other market reasons, the duration of the employee stock ownership plan will be extended accordingly upon the consent of 2/3 (inclusive) or more of the shares held by the holders attending the holders' meeting and submission to the company's board of directors for review and approval.

2. Lock-in period of this employee stock ownership plan

The lock-up period for the company's stocks obtained under this employee stock ownership plan is 12 months, starting from the time when the listed company announces the transfer of the last underlying stock to the name of this employee stock ownership plan. This employee stock ownership plan will terminate automatically if it is not extended after the expiration of the duration. After the lock-in period expires, during the duration, the management committee has the right to sell the purchased underlying stocks on its own based on the arrangements of the employee stock ownership plan and the prevailing market conditions.
During the lock-in period, if the company converts capital reserves into share capital, distributes stock dividends, allots shares, etc., the newly acquired stocks under this plan will be locked together, and the unlocking period of these stocks will be the same as the corresponding stocks.

3. Transaction restrictions of this employee stock ownership plan

This employee stock ownership plan will strictly abide by market trading rules and comply with the regulations of the China Securities Regulatory Commission and Shenzhen Stock Exchange on the prohibition of buying and selling stocks during the information-sensitive period. The company's stocks are not allowed to be bought or sold during the following periods:

Within fifteen days before the announcement of the listed company’s annual report and semi-annual report;
Within five days before the announcement of quarterly reports, performance forecasts, and performance bulletins of listed companies;
From the date of the occurrence of a major event that may have a greater impact on the trading prices of the company's securities and its derivatives, or during the decision-making process, to the date of disclosure in accordance with the law;
Other periods specified by the China Securities Regulatory Commission and Shenzhen Stock Exchange.

If relevant laws, administrative regulations, and departmental rules have other provisions on the period during which no trading is allowed or the relevant provisions change, the relevant provisions at that time shall prevail, and the company will no longer revise this draft separately.

4. Performance evaluation of employee stock ownership plan

(1) Company-level performance appraisal

This employee stock ownership plan uses the company's operating income or net profit in 2026 as the performance assessment target. Based on the assessment results, the proportion of equity corresponding to the holder's share that is actually obtained by the holder after the lock-in period of this employee stock ownership plan is determined. Specific performance appraisal requirements are as follows:

Assessment year The company’s performance assessment target unlocks the operating revenue in 2026: 2.964 billion yuan (a year-on-year increase of 3%), or 2026

In 2026, 100% annual net profit will be 150 million yuan (a year-on-year increase of 544%).

Note: 1. The "net profit" caliber is based on the consolidated statement audited by an accounting firm, where "net profit" refers to the net profit attributable to shareholders of listed companies;

The "operating income" caliber shall be based on the consolidated statement audited by an accounting firm;
Based on the above caliber, the company's operating income in 2025 will be 2.878 billion yuan, and its net profit in 2025 will be 275.5 million yuan. The setting of performance appraisal targets for 2026 is mainly based on the following reasons:
In 2025, the company's Phase 6 factory project will be fully put into production, with an additional production capacity (equivalent to 15% content of chlortetracycline premix) of 60,000 tons/year, which has greatly increased the company's production capacity scale, and operating income increased by 21.41% year-on-year. There will be no new production capacity in 2026, and performance will stabilize. The company's new performance growth points are still in reserve, and it will take some time for performance to explode. Operating income in 2026 will grow steadily by 3%, or 2.964 billion yuan.
The main raw material of the company's chemical products is corn starch. Due to geopolitical risks, the prices of corn, energy, etc. have increased, and raw material and transportation costs have shown an increasing trend. The RMB is on an appreciation trend in 2026. The company's export revenue accounts for a large proportion and it has overseas subsidiaries. Therefore, the company's US dollar-denominated assets and the company's overseas sales revenue are related to exchange rate fluctuations, and exchange rate fluctuations will have a certain impact on the company's performance. The company's downstream pig market is affected by the current pig cycle. Pig prices have been depressed for a long time, and the profit margins of breeding companies have narrowed, and some have even suffered losses. As an upstream animal health company, the company's product sales situation is grim. During the 2025 reporting period, the net profit attributable to shareholders of the listed company was 27.5567 million yuan, a year-on-year decrease of 72.50%; the main reason was the accrual of large amounts of goodwill. Excluding the impact of goodwill impairment, the net profit attributable to shareholders of the listed company was 177.3697 million yuan, a year-on-year increase of 31.55%. In 2026, taking into account the impact of factors such as goodwill and share-based payment, the net profit attributable to shareholders of listed companies will be approximately 150 million yuan, a year-on-year increase of 544%. Based on the above reason analysis, the above assessment objectives are formulated.

If the company-level performance assessment requirements are not met, the equity and shares of the stock ownership plan that cannot be unlocked by the holder in the current period will be taken back by the management committee. After the opportunity is sold, the holder will be returned to the holder with the capital contribution amount plus the deposit interest rate of the People's Bank of China for the same period. The remaining funds (if any) will belong to the company; or the corresponding underlying stocks will be disposed of through other methods permitted by laws and regulations.

(2) Individual level performance appraisal

The individual-level assessment of this employee stock ownership plan is implemented in accordance with the company's internal performance assessment related systems, and the assessment year is 2026. The holder's personal assessment and evaluation results are divided into four levels: "Excellent", "Good", "Medium" and "Poor". The corresponding proportions of unlocking at the individual level are as follows:

Personal assessment results of the previous year (S) S≥80 80>S≥70 70>S≥60 S<60 Assessment grade Excellent Medium Poor

Individual level unlocking ratio 100% 100% 80% 0

On the premise that the company's performance goals are achieved, the actual unlockable amount of the holder for the year = the individual's planned unlocked amount for the year × the individual-level unlocking ratio.

The specific assessment content of this employee stock ownership plan is implemented in accordance with the company's relevant assessment management measures.

The rights and shares of the stock ownership plan that cannot be unlocked by the holder due to personal assessment reasons will be recovered by the management committee. After the opportunity is sold, the holder will be returned to the holder in the amount of the capital contribution plus the deposit interest rate of the People's Bank of China for the same period. The remaining funds (if any) will belong to the company; or the corresponding underlying stocks will be disposed of through other methods permitted by laws and regulations.

(3) Scientific and rational explanation of the setting of the company’s performance assessment indicators

The company is a high-tech enterprise specializing in the research and development, production, sales and service of animal health products. It is a leading company in the global chlortetracycline premix industry. The company's corporate vision is to become the world's leading animal health company and provide high-quality products and services to global customers. In order to achieve this goal, the company actively deploys new varieties and explores new tracks in the fields of veterinary chemicals and veterinary vaccines. Currently, the company's existing businesses include animal health products, environmentally friendly sewage treatment and agricultural product processing. Its product categories include veterinary chemicals, veterinary vaccines, corn starch and co-products, and industrial sewage treatment services.

In order to achieve the company's strategic planning, business objectives and maintain comprehensive competitiveness, this employee stock ownership plan decides to use the net profit attributable to shareholders of listed companies in the audited consolidated statements or the operating income in the audited consolidated statements as the company-level performance assessment indicator. This indicator can directly reflect the company's profitability and corporate growth.

According to the setting of the performance indicators of this employee stock ownership plan, the company's operating income in 2026 will be 2.964 billion yuan (a year-on-year increase of 3%), or the net profit in 2026 will be 150 million yuan (a year-on-year increase of 544%). The setting of this performance indicator is formulated based on comprehensive consideration of the company's current situation, future strategic planning, industry development and other factors. The set assessment indicator is challenging for future development. On the one hand, this indicator helps to enhance the company's competitiveness and mobilize employees' work enthusiasm. On the other hand, it can focus on the company's future development strategic direction and stabilize the realization of business goals.

In addition to company-level performance appraisal, the company has also set up a strict performance appraisal system for individuals, which can make a more accurate and comprehensive comprehensive evaluation of the holder's work performance. The company will determine whether the individual holder meets the conditions for unlocking based on the annual performance evaluation results corresponding to the holder's unlocking.

In summary, the assessment system of this employee stock ownership plan is comprehensive, comprehensive and operable, and the setting of assessment indicators is scientific and rational. It also has a binding effect on holders and can achieve the assessment purpose of this employee stock ownership plan.

Chapter 5 Management Model of Employee Stock Ownership Plan

After being approved by the shareholders' meeting, the employee stock ownership plan will be self-managed by the company after its establishment. The highest internal management authority of this employee stock ownership plan is the holders' meeting. The holders' meeting sets up a management committee and authorizes the management committee to serve as the management organization of the employee stock ownership plan, supervise the daily management of the employee stock ownership plan, and exercise shareholder rights on behalf of the holders. The Management Committee manages the assets of the Employee Stock Ownership Plan in accordance with laws, administrative regulations, departmental rules, normative documents, securities regulatory agencies and the provisions of the Employee Stock Ownership Plan, safeguards the legitimate rights and interests of holders of the Employee Stock Ownership Plan, ensures the safety of the assets of the Employee Stock Ownership Plan, and avoids potential conflicts of interest between other shareholders of the company and holders of the Employee Stock Ownership Plan.

The company's board of directors is responsible for formulating and revising the draft plan, and handling other related matters of the employee stock ownership plan within the scope authorized by the shareholders' meeting. This employee stock ownership plan plan and the corresponding "Employee Stock Ownership Plan Management Measures" clearly stipulate the rights and obligations of the management committee, and the risk prevention and isolation measures are sufficient.

1. Holder

The rights of the holder are as follows:

(1) Participate in holders’ meetings and exercise voting rights;

(2) Enjoy the rights and interests of this employee stock ownership plan in proportion to their shares;

(3) Supervise the management of the employee stock ownership plan and make suggestions or inquiries;

(4) Enjoy other rights of holders stipulated in relevant laws, regulations or this employee stock ownership plan.

The holder’s obligations are as follows:

(1) During the duration of the employee stock ownership plan, the holder's shares of the employee stock ownership plan may not be transferred, withdrawn, used for guarantee, debt repayment or other similar disposals without the consent of the management committee; (2) Contribution of capital within the agreed period according to the subscribed share of the employee stock ownership plan;

(3) Bear the risks of the employee stock ownership plan based on the shares subscribed to the employee stock ownership plan;

(4) Comply with relevant laws and regulations.

2. Holders’ meeting

The company’s employees become holders of this plan after subscribing for shares of the employee stock ownership plan. The holders’ meeting is the internal management authority of the employee stock ownership plan. All holders have the right to participate in holders meetings. Holders may attend the holders' meeting in person and vote, or entrust a proxy to attend and vote on their behalf. The travel expenses, food and accommodation expenses, etc. incurred by the holder and his/her agent to attend the holder's meeting shall be borne by the holder himself.
The following matters need to be held at a holders’ meeting for review:

(1) Elect and remove members of the management committee;

(2) Change, termination and extension of the duration of the employee stock ownership plan;

(3) During the duration of the employee stock ownership plan, when the company raises funds through rights issue, additional issuance, convertible bonds, etc., the management committee will confirm whether to participate and submit it to the employee stock ownership plan holders meeting for review;

(4) Review and revise the "Measures for the Administration of Employee Stock Ownership Plans";

(5) Authorize the management committee to supervise the daily management of the employee stock ownership plan;

(6) Authorize the management committee to open securities accounts, capital accounts and other related accounts for the stock ownership plan; (7) Authorize the management committee to exercise shareholder rights;

(8) Authorize the management committee to be responsible for the sale, liquidation and property distribution of the underlying stocks held by the employee stock ownership plan;

(9) Other matters that the management committee deems necessary to convene a holders’ meeting for consideration.

The first holders’ meeting shall be convened and chaired by the company’s board secretary or designated person. Subsequent holders’ meetings shall be convened by the management committee and chaired by the director of the management committee. When the chairman of the management committee is unable to perform his duties, he shall designate a member of the management committee to take charge of the chair.
When convening a holders’ meeting, the management committee shall submit written notice of the meeting to all holders 3 days in advance by direct delivery, mail, fax, email or other means. The written notice of meeting should at least include the following:

(1) Time and place of meeting;

(2) How the meeting is held;

(3) Matters to be considered (meeting proposals);

(4) The convener and host of the meeting, the proposer of the extraordinary meeting and his or her written proposal;

(5) Meeting materials necessary for voting at the meeting;

(6) The holder shall attend the meeting in person or entrust another holder to attend the meeting on his or her behalf;

(7) Contact person and contact information;

(8) Date of issuance of notice.

In case of emergency, a meeting of holders can be convened by verbal notification. The oral meeting notice should at least include the above items (1) and (3) and a description of the need to convene the holders’ meeting as soon as possible due to emergency circumstances.

On the premise of ensuring that holders can fully express their opinions, holders' meetings can be held by telephone conference, video conferencing and other communication methods. All holders who participate in the meeting through these methods shall be deemed to have attended the meeting in person.

Voting procedures for holders’ meeting

(1) After each proposal has been fully discussed, the host should promptly ask the participating holders to vote. The host may also decide to submit all proposals to the meeting holders for a vote after all proposals have been discussed. The voting method shall be written voting;

(2) Holders of this employee stock ownership plan have voting rights according to the shares they hold;

(3) The holder’s voting intention is divided into consent, opposition and abstention. Holders attending the meeting should choose one of the above intentions. If they fail to make a choice or choose more than two intentions at the same time, they will be deemed to have abstained. If they leave the venue midway without returning without making a choice, they will be deemed to have abstained. If the holder votes after the presiding officer of the meeting announces the voting results or after the prescribed voting time limit has expired, the voting results will not be counted;

(4) The host of the meeting shall announce the statistical results of on-site voting on the spot. If each proposal is approved by more than 50% (exclusive of 50%) of the shares held by the holders attending the holders' meeting, it will be deemed to be passed by voting (except for the employee stock ownership plan that requires the consent of more than 2/3 (inclusive) of the shares), forming a valid resolution of the holders' meeting; (5) If the resolution of the holders' meeting needs to be submitted to the company's board of directors and shareholders' meeting for review, it must be submitted to the company's board of directors and shareholders' meeting for review in accordance with the provisions of the "Articles of Association";

(6) The meeting host is responsible for arranging to keep records of the holders’ meeting.

Holders who individually or collectively hold more than 1/3 of the shares of the employee stock ownership plan can submit a temporary proposal to the holders' meeting. The temporary proposal must be submitted to the management committee 3 days before the holders' meeting.
Holders who individually or collectively hold more than 1/3 of the shares of the employee stock ownership plan may propose to convene an extraordinary meeting of holders.
The holders’ meeting can only be held if holders holding more than 50% of the shares of the employee stock ownership plan in total are present.

3. Management Committee

The employee stock ownership plan has a management committee, which is responsible for the holder meetings of the employee stock ownership plan. It is the daily supervision and management organization of the employee stock ownership plan and exercises shareholder rights on behalf of the holders.
The Management Committee consists of 3 members, including 1 director of the Management Committee. Members of the Management Committee are elected by the shareholders' meeting. The Chairman of the Management Committee shall be elected by a majority of all members of the Management Committee. The term of office of the members of the Management Committee shall be the duration of the employee stock ownership plan.
Members of the management committee shall abide by the provisions of laws, administrative regulations and normative documents, and have the following loyalty obligations towards the employee stock ownership plan:

(1) No one shall take advantage of their authority to accept bribes or other illegal income, and shall not misappropriate the property of the employee stock ownership plan;

(2) No funds from employee stock ownership plans may be misappropriated;

(3) Without the consent of the management committee, no account shall be opened to store the assets or funds of the employee stock ownership plan in his or her own name or in the name of other individuals;

(4) Without the consent of the holders’ meeting, employee stock ownership plan funds may not be loaned to others or employee stock ownership plan properties may be used to provide guarantee for others;

(5) Shall not use his authority to harm the interests of employee stock ownership plans;

(6) No commercial secrets related to the employee stock ownership plan shall be disclosed without authorization;

(7) Other obligations stipulated in laws, regulations, departmental rules and this employee stock ownership plan.

If a member of the management committee violates his duty of loyalty and causes losses to the employee stock ownership plan, he shall be liable for compensation.

The Management Committee shall perform the following duties:

(1) Responsible for convening the holders’ meeting and implementing the resolutions of the holders’ meeting;

(2) Represent all shareholders in the daily management of the employee stock ownership plan;

(3) Exercise shareholder rights on behalf of all shareholders;

(4) Manage the distribution of benefits from employee stock ownership plans;

(5) Determine the disqualification of holders in accordance with the provisions of the employee stock ownership plan, and the handling of the shares held by disqualified holders, including adding holders, changes in holder shares, etc.;

(6) Review the redistribution plan in accordance with the provisions of the employee stock ownership plan;

(7) Decide on the recovery and inheritance of employee stock ownership plan shares and the arrangements for the redemption of corresponding benefits;

(8) Handle inheritance registration for employee stock ownership plan shares;

(9) Decision-making on special matters other than the above matters during the duration of the employee stock ownership plan;

(10) Sign relevant documents on behalf of all holders;

(11) Other duties authorized by the holders’ meeting;

(12) Other duties that should be performed by the management committee as stipulated in this employee stock ownership plan and relevant laws and regulations.

The Chairman of the Management Committee shall exercise the following powers:

(1) Preside over holders’ meetings and convene and preside over management committee meetings;

(2) Supervise and inspect the implementation of resolutions of the holders’ meeting and management committee;

(3) Other powers granted by the Management Committee.

The Management Committee will hold meetings from time to time, convened by the Chairman of the Management Committee, and all members of the Management Committee will be notified 3 days before the meeting. In case of emergency, all members of the Management Committee may be notified 1 day before the meeting.
On behalf of holders of more than 30% of the shares of the employee stock ownership plan and more than 1/3 of the members of the management committee, they may propose to convene an extraordinary meeting of the management committee. The chairman of the management committee shall convene and preside over a meeting of the management committee within 5 days after receiving the proposal.
Members of the Management Committee may propose to convene an extraordinary meeting of the Management Committee. The chairman of the management committee shall convene and preside over a meeting of the management committee within 3 days after receiving the proposal.
The notice of the Management Committee meeting includes the following contents:

(1) Meeting date and location;

(2) Meeting period;

(3) Reasons and issues;

(4) Date of issuance of notice.

Meetings of the Management Committee must be attended by more than half of the members of the Management Committee before they can be held. Resolutions made by the Management Committee must be approved by more than half of all members of the Management Committee. The voting on resolutions of the Management Committee shall be based on the one-person-one-vote system.
The voting method for the resolutions of the Management Committee shall be a registered vote. On the premise of ensuring that the members of the Management Committee fully express their opinions, the meeting of the Management Committee can be held and resolutions made using electronic signatures, which must be signed by all members of the Management Committee.
Management Committee meetings shall be attended by members of the Management Committee in person. If a member of the Management Committee is unable to attend for any reason, he may entrust another member of the Management Committee 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 client. The members of the Management Committee who attend the meeting on their behalf shall exercise their rights as members of the Management Committee within the scope of authorization. If a member of the Management Committee fails to attend a meeting of the Management Committee or appoints a representative to attend, he shall be deemed to have given up his right to vote at that meeting.
The Management Committee shall form minutes of its decisions on matters discussed at the meeting, and members of the Management Committee who attended the meeting shall sign on the minutes.

4. Matters authorized by the shareholders’ meeting to the board of directors

The shareholders' meeting authorizes the board of directors to have full authority to handle matters related to the employee stock ownership plan, including but not limited to the following matters:

Authorize the board of directors to handle the establishment, change and termination of the employee stock ownership plan;
Authorize the board of directors to make decisions on the extension and early termination of the employee stock ownership plan;
Authorize the board of directors to handle all matters of locking and unlocking the stocks purchased under the employee stock ownership plan;
Authorize the board of directors to explain the employee stock ownership plan (draft);
Authorize the board of directors to make decisions on the employee stock ownership plan’s participation in the company’s allotment of shares and other refinancing matters during its duration;
Authorize the board of directors to change the participants and determination criteria of the employee stock ownership plan;
Authorize the board of directors to decide and change the management methods and methods of the employee stock ownership plan;
Authorize the board of directors to sign the contract and related agreement documents with the employee stock ownership plan;
If relevant laws, regulations, and policies are adjusted, the board of directors is authorized to make corresponding modifications and improvements to the employee stock ownership plan based on the adjustment;
Authorize the board of directors to handle other necessary matters required for the employee stock ownership plan, except for rights that are clearly stipulated in relevant documents and need to be exercised by the shareholders' meeting.

The above authorization is valid from the date of approval by the company's shareholders' meeting to the date of completion of the implementation of the employee stock ownership plan.

5. Risk prevention and isolation measures

The assets of the employee stock ownership plan are independent of the company’s inherent property. The company shall not misappropriate or misappropriate the assets of the employee stock ownership plan or confuse the assets of the employee stock ownership plan with the company's inherent assets in any other form.
This employee stock ownership plan plan and the corresponding employee stock ownership plan management measures clearly stipulate the rights and obligations of the management committee, and the risk prevention and isolation measures are sufficient.

The management committee manages the assets of the employee stock ownership plan in accordance with laws, administrative regulations, departmental rules, normative documents, securities regulatory agencies and the provisions of the employee stock ownership plan, safeguards the legitimate rights and interests of the holders of the employee stock ownership plan, ensures the safety of the assets of the employee stock ownership plan, and avoids potential conflicts of interest between other shareholders of the company and holders of the employee stock ownership plan.

During the duration, the management committee may hire a third-party professional organization to provide management, consulting and other services for the employee stock ownership plan.

Chapter 6 Asset Composition and Equity Distribution of Employee Stock Ownership Plan

1. Asset composition of stock ownership plan

This employee stock ownership plan holds the corresponding rights and interests of the company’s stocks;
Cash deposits and bank interest;
Assets formed from other investments in the employee stock ownership plan.

The assets of this employee stock ownership plan are independent of the company's assets, and the company shall not entrust the assets of this employee stock ownership plan into its inherent property. The property and income obtained from the management, operation or other circumstances of this employee stock ownership plan shall be included in the assets of this employee stock ownership plan.

2. Equity distribution of stock ownership plan

During the duration of the employee stock ownership plan, unless otherwise provided by laws, administrative regulations, etc., or with the consent of the management committee, the holder's shares of the employee stock ownership plan may not be used for guarantees, debt repayments, or other similar disposals.
During the lock-in period, the holder shall not request the distribution of the rights and interests of the employee stock ownership plan.
During the lock-in period, when the company converts capital reserves to share capital and distributes stock dividends, the newly acquired shares of the employee stock ownership plan due to holding company shares are locked together and cannot be sold or transferred in other ways in the secondary market. The unlocking period of these stocks is the same as the corresponding stocks. Cash dividends received by the holders for holding company shares should also comply with the above locking and unlocking arrangements.
After the lock-up period of the underlying stocks under the employee stock ownership plan expires, the management committee will determine the disposal method of the underlying stocks.

After the lock-up period expires, the management committee will gradually realize the assets of the share ownership plan and distribute them to the holders in proportion to their shares.

If there are remaining unallocated underlying stocks and their corresponding dividends (if any), the stock ownership plan management committee will distribute them in proportion to the shares held by the holders before the expiration of the stock ownership plan.

When the duration of the employee stock ownership plan expires or is planned to be terminated early, the management committee will complete the liquidation within 30 working days from the date of expiration or termination after deducting relevant taxes and fees in accordance with the authorization of the holders' meeting, and distribute the shares according to the shares held by the holders.
If other unagreed matters occur, the disposal method of the employee stock ownership plan shares held by the holders shall be determined by the holders' meeting.

Each tax payer involved in this employee stock ownership plan shall fulfill its tax obligations in accordance with national tax laws and regulations. The employee stock ownership plan shall accrue and pay transaction fees, stamp taxes, etc. according to the prescribed proportion when investment transactions occur. Fees other than transaction fees and stamp taxes shall be paid by the management committee from the assets of the employee stock ownership plan in accordance with relevant laws, regulations and corresponding agreements.

Chapter 7 Disposal of Employee Stock Ownership Plan Holders’ Rights and Interests

1. Principles for the disposal of holders’ rights and interests

(1) During the duration, the holders’ meeting authorizes the management committee to exercise the shareholder rights corresponding to the shares held by the employee stock ownership plan on behalf of all holders;

(2) During the duration, except for special circumstances stipulated in laws, administrative regulations, the employee stock ownership plan, or upon review and approval at the holders’ meeting, the holder’s shares of the employee stock ownership plan shall not be used for mortgage or pledge, guarantee, debt repayment or other similar disposals;

(3) During the duration, the rights and interests held by the holder of the employee stock ownership plan may not be transferred without the consent of the management committee. If transferred without consent, the transfer shall be invalid;

(4) During the duration of the Employee Stock Ownership Plan, the rights and interests held by employees in the Employee Stock Ownership Plan may not be transferred without the consent of the Management Committee. If transferred without consent, the transfer will be invalid; however, if one of the following circumstances occurs, the Management Committee has the right to cancel the holder's qualification to participate in the Employee Stock Ownership Plan and the ownership plan. For the corresponding equity shares, the principal and the interest calculated at the deposit rate of the People's Bank of China for the same period will be returned and the shares held will be recovered. The recovered shares will be transferred to the transferee designated by the management committee who is qualified to participate in the employee stock ownership plan, or handled through other methods permitted by laws and regulations, as determined by the management committee:

The company (including branches and subsidiaries) terminates the labor relationship or employment relationship with the holder due to his inability to perform the job;
The holder resigns or the holder refuses to renew the contract with the company (including branches and subsidiaries) after the labor relationship or employment relationship expires;
After the holder’s labor relationship or employment relationship expires, the company (including branches and subsidiaries) does not renew the contract;
The holder has serious dereliction of duty, dereliction of duty or violation of relevant national laws, administrative regulations or the Articles of Association, causing significant economic losses to the company and damaging the company's interests and reputation;
The holder’s labor relationship or employment relationship is terminated by the company due to violation of laws, administrative regulations or serious violation of the company’s rules and regulations;
The holder is held administratively or criminally responsible for illegal or criminal acts;
Other behaviors determined by the management committee to be incompatible with the holder's qualifications.

(5) During the duration of the employee stock ownership plan, when one of the following circumstances occurs, the rights held by the holder will not be changed:

Job change

During the duration, if the holder's position changes but still meets the conditions for participation, the rights and interests held by the holder of the employee stock ownership plan will not be changed;

Loss of working ability

During the duration, if the holder loses the ability to work due to work, the rights and interests held by the employee stock ownership plan will not be changed;

During the duration, if the holder loses the ability to work due to reasons other than work, the holder’s realized income and unlocked undistributed portion of the shareholding plan will not be affected. The management committee has the right to take back the unlocked equity shares of the shareholding plan and refund its principal and interest calculated from the deposit interest rate of the People's Bank of China for the same period. The recovered shares shall be handled by the management committee through the "Employee Stock Ownership Plan Management Measures" and in the manner permitted by laws and regulations.

Retirement

During the duration, if the holder reaches the retirement age stipulated by the state and retires, the rights and interests held by the employee stock ownership plan will not be changed.

Death

During the duration, if the holder dies, the rights and interests of the employee stock ownership plan held by him will not be changed, and will be inherited and continued to be enjoyed by his legal heirs; these heirs are not subject to the restriction of being qualified to participate in the employee stock ownership plan.

Other circumstances determined by the management committee.

2. Disposal of equity after the expiration of the employee stock ownership plan

When the duration of the employee stock ownership plan expires or is terminated early, the employee stock ownership plan shall complete liquidation within 30 trading days after the expiration or early termination of the duration, and decide whether to distribute the income corresponding to the employee stock ownership plan. If the distribution is decided, the management committee shall distribute the shares according to the shares held by the holders after deducting relevant taxes and fees in accordance with the law. During the lock-in period, when the company pays dividends, the cash dividends received by the employee stock ownership plan from holding the company's shares will be included in the monetary assets of the employee stock ownership plan and will not be distributed separately for the time being. After the lock-in period of this employee stock ownership plan ends and during the duration, the management committee will decide whether to distribute it. After the lock-in period of this employee stock ownership plan ends and during the duration, when the company pays dividends, the cash dividends received by the employee stock ownership plan from holding the company's shares will be included in the monetary assets of the employee stock ownership plan.

During the duration of the current plan, if other unspecified matters involving the disposal of equity in the current plan occur, the management committee will decide.

Chapter 8 Changes and Termination of Employee Stock Ownership Plans

1. The company’s actual control changes, merges, and splits

If the actual controller of the company changes, or there is a merger, split, etc., the employee stock ownership plan will not be changed.

2. Changes to employee stock ownership plans

During the duration of the employee stock ownership plan, changes to the employee stock ownership plan must be approved by more than 2/3 (inclusive) of the shares held by the holders attending the holders' meeting and submitted to the company's board of directors for review and approval before implementation.

3. Termination of employee stock ownership plan

The employee stock ownership plan will terminate automatically upon expiration.
This employee stock ownership plan can be terminated early with the consent of more than 2/3 (inclusive) of the shares held by the holders attending the holders' meeting and submitted to the company's board of directors for review and approval.
After the lock-in period of the employee stock ownership plan expires, when all the stocks held by the stock ownership plan are sold or transferred out and the monetary assets (if any) under the stock ownership plan have been fully liquidated and distributed, the employee stock ownership plan can be terminated early.
Before the expiration of the duration of the employee stock ownership plan, if all the company stocks held have not been sold, the duration of the employee stock ownership plan can be extended with the consent of more than 2/3 (inclusive) of the shares held by the holders attending the holders' meeting and submitted to the company's board of directors for review and approval. After the extension period, the employee stock ownership plan will terminate automatically.
If the company's stocks held by the employee stock ownership plan cannot be fully liquidated before the expiration of the upper limit of the duration due to suspension of trading of the company's stocks or information sensitive periods, etc., the duration of the stock ownership plan can be extended with the consent of more than 2/3 (inclusive) of the shares held by the holders attending the holders' meeting and submission to the company's board of directors for review and approval.

Chapter 9 Rights and Obligations of the Company and its Holders

1. The company’s rights and obligations

The company’s rights

(1) Dispose of the rights and interests of holders in accordance with the relevant provisions of the employee stock ownership plan; (2) Supervise the operation of the employee stock ownership plan and safeguard the interests of holders;

(3) Other rights stipulated in laws, administrative regulations and this shareholding plan.

The company’s obligations

(1) Fulfill the information disclosure obligations regarding the employee stock ownership plan in a true, accurate, complete and timely manner; (2) Provide other corresponding support for opening and canceling securities accounts, capital accounts, etc. for the employee stock ownership plan in accordance with relevant laws and regulations;

(3) Other obligations stipulated in laws, administrative regulations and this employee stock ownership plan.

2. Rights and obligations of holders

Rights of the holder

(1) Participate in holders’ meetings in accordance with the provisions of the employee stock ownership plan, and exercise voting rights based on the shares held on matters under review;

(2) Enjoy the rights and interests of the employee stock ownership plan based on the shares held in the employee stock ownership plan; (3) Supervise the management of the employee stock ownership plan and make suggestions or inquiries; (4) Other rights stipulated in laws, administrative regulations, and departmental rules.

Obligations of holders

(1) Comply with the provisions of this employee stock ownership plan;

(2) Pay subscription funds according to the subscribed shares and method of the employee stock ownership plan; (3) Bear investment risks according to the shares held in the employee stock ownership plan;

(4) Comply with the relevant provisions of the "Measures for the Administration of Employee Stock Ownership Plans";

(5) Keep all secrets during the implementation of the employee stock ownership plan, except for those announced by the company in accordance with the law;

(6) Undertake other obligations stipulated in relevant laws, regulations, rules and this employee stock ownership plan.

Chapter 10 How to participate in the employee stock ownership plan when the company is financing

During the duration of this employee stock ownership plan, if the company raises funds through rights issue, additional issuance, convertible bonds, etc., the management committee will discuss and decide whether to participate in this employee stock ownership plan and submit it to the holders' meeting for review.

Chapter 11 Accounting Treatment of Employee Stock Ownership Plans

According to the provisions of "Accounting Standards for Business Enterprises No. 11 - Share-based Payment": For equity-settled share-based payment that is exchanged for employee services after completing services within the waiting period or exercising upon meeting specified performance conditions, on each balance sheet date during the waiting period, the services obtained in the current period shall be included in the relevant costs or expenses and capital reserves based on the best estimate of the number of exercisable equity instruments and the fair value on the date of grant of the equity instrument.

Assuming that the company transfers all underlying stocks to the name of this employee stock ownership plan in July 2026, the amortization of the employee stock ownership plan expenses from 2026 to 2027 is estimated to be as follows:

Unit: Total amortization expense in 10,000 yuan 2026 2027

2157.84 1078.92 1078.92

Note: The final result of the above impact on the company's operating results will be based on the annual audit report issued by the accounting firm.

Chapter 12 Procedures for Implementing Employee Stock Ownership Plans

The Board of Directors and its subordinate Remuneration and Appraisal Committee are responsible for formulating a draft employee stock ownership plan, soliciting employee opinions through the Employee Representative Conference and submitting it to the Board of Directors for review.
Before the company implements the employee stock ownership plan, it should fully solicit the opinions of employees through the employee representative conference and other organizations.
The board of directors reviews the draft employee stock ownership plan, and the remuneration and assessment committee of the board of directors expresses its opinions on whether the employee stock ownership plan is conducive to the sustainable development of the company, whether it harms the legitimate rights and interests of all shareholders of the company, and whether there are apportionment, forced distribution and other methods to force employees to participate in the employee stock ownership plan.
Within 2 trading days after the board of directors considers and approves the employee stock ownership plan, the board of directors’ resolution, the employee stock ownership plan (draft) and summary, the opinions of the remuneration and assessment committee of the board of directors, etc. will be announced. When the board of directors considers the employee stock ownership plan, directors related to the employee stock ownership plan shall abstain from voting.
The company hires a law firm to issue a legal opinion on whether the employee stock ownership plan and related matters are legal and compliant, and whether the necessary decision-making and approval procedures have been performed, etc., and announce the legal opinion two trading days before the shareholders' meeting to review the employee stock ownership plan.
Convene a shareholders’ meeting to review the employee stock ownership plan. The shareholders' meeting will vote using a combination of on-site voting and online voting. When the shareholders' meeting votes, relevant shareholders involved in the employee stock ownership plan should abstain from voting.

The resolution of the shareholders' meeting on the employee stock ownership plan must be passed by more than half of the voting rights held by the non-affiliated shareholders present at the meeting. After the shareholders' meeting has reviewed and approved the employee stock ownership plan, the resolution of the shareholders' meeting and the main terms of the employee stock ownership plan should be disclosed in a timely manner.

The employee stock ownership plan can be implemented after it is reviewed and approved by the company's shareholders' meeting.
Convene a meeting of holders of the employee stock ownership plan, elect members of the management committee, clarify specific matters for the implementation of the employee stock ownership plan, and promptly disclose the convening of the meeting and relevant resolutions;
The company should promptly disclose the time and quantity of the underlying stocks acquired within 2 trading days after the underlying stocks are transferred to the name of the employee stock ownership plan;

10. Other procedures that need to be performed as stipulated by the China Securities Regulatory Commission and the Shenzhen Stock Exchange.

Chapter 13 Explanation of concerted action relationship and association relationship

This employee stock ownership plan does not constitute a concerted action relationship stipulated in the "Measures for the Administration of Acquisitions of Listed Companies" between the company's controlling shareholders, actual controllers, directors, and senior managers. The details are as follows:

The company’s controlling shareholder and actual controller did not participate in the employee stock ownership plan, and the employee stock ownership plan did not sign a concerted action agreement or have a concerted action arrangement with the company’s controlling shareholder or actual controller;
Some of the company’s directors and senior managers plan to participate in the employee stock ownership plan, and the above persons and their related parties are related to the employee stock ownership plan. Except for the above persons, there is no relationship between the employee stock ownership plan and other directors of the company.
When the company’s shareholders meeting considers and participates in the relevant proposals of the employee stock ownership plan, the employee stock ownership plan shall abstain from voting.
When the company's shareholders meeting considers transaction-related proposals related to participants participating in the employee stock ownership plan, the employee stock ownership plan shall abstain from voting.
The holders’ meeting is the highest authority of the employee stock ownership plan. The holders’ meeting elects a management committee, which is responsible for the daily management of the employee stock ownership plan, is responsible for the employee stock ownership plan holders’ meeting, and exercises shareholder rights on behalf of the holders. The directors and senior managers of the company who participate in this employee stock ownership plan and the directors and senior managers of the controlling shareholder do not hold any position in the management committee of this employee stock ownership plan. This employee stock ownership plan remains independent from the company's controlling shareholders, actual controllers, directors, and senior managers in terms of relevant operations and other matters. The shares held by the holders of this employee stock ownership plan are relatively dispersed. As holders, the company's directors and senior managers will abstain from voting when the holders' meeting and the management committee consider matters related to them. No single holder can have a significant impact on the decisions of the holders' meeting and the management committee.

In summary, except for some of the company’s directors and senior managers who plan to participate in this employee stock ownership plan, and the above holders are related to this employee stock ownership plan, the company’s controlling shareholders, actual controllers, directors, and senior managers have no consistent action arrangements with this employee stock ownership plan. This employee stock ownership plan remains independent from the controlling shareholders, actual controllers, directors, and senior managers in terms of relevant operations and other matters. The company's controlling shareholders, actual controllers, directors, senior managers and the employee stock ownership plan do not constitute a concerted action relationship.

Chapter 14 Other important matters

The approval of this employee stock ownership plan by the company's board of directors and shareholders' meeting does not mean that the holder has the right to continue serving in the company, nor does it constitute the company's commitment to the employee's employment period. The labor relationship or employment relationship between the company and the holder is still governed by the relevant contract signed between the company and the holder.
The company's financial, accounting, taxation and other matters when implementing the employee stock ownership plan shall be implemented in accordance with the relevant financial systems, accounting standards, and taxation systems. The relevant taxes and fees that employees need to pay due to the implementation of the employee stock ownership plan shall be borne by the employees themselves.

3. The right to interpret this employee stock ownership plan belongs to the company’s board of directors.

If there is a conflict between this employee stock ownership plan and the latest laws and regulations issued by regulatory agencies, the latest laws and regulations shall prevail.

Board of Directors of Jinhe Biotechnology Co., Ltd.

April 28, 2026