*ST Bio: Nanhua Biocommodity Futures Trading Management System (formulated in December 2025)
Nanhua Biopharmaceutical Co., Ltd.
Commodity futures trading management system
Chapter 1 General Provisions
Article 1 In order to standardize the management of the commodity futures trading business of Nanhua Biopharmaceutical Co., Ltd. (hereinafter referred to as the "Company") and its wholly-owned and controlled subsidiaries, effectively control transaction risks, and safeguard the interests of the company and shareholders, this system is formulated in accordance with the Company Law of the People's Republic of China, the Securities Law of the People's Republic of China, the Stock Listing Rules of the Shenzhen Stock Exchange, the Self-Regulatory Guidelines for Listed Companies of the Shenzhen Stock Exchange No. 7 - Transactions and Related Transactions, and the Articles of Association, as well as other laws and regulations, normative documents and the Company's Articles of Association, and based on the actual situation of the company.
Article 2 The term “commodity futures trading” as used in this system refers to trading activities with futures contracts or standardized options contracts on commodities as the underlying assets as the trading subject matter.
Article 3 This system applies to the company and its wholly-owned and controlled subsidiaries. Commodity futures trading by wholly-owned or controlled subsidiaries must be submitted to the company for approval, and any relevant trading activities may not be carried out without approval.
Article 4 A company shall conduct commodity futures trading in accordance with the principles of legality, prudence, safety and effectiveness, and shall limit it to the purpose of hedging and risk management. It shall not use raised funds or affect the normal operation of its main business.
Chapter 2 Approval Authority and Execution Procedures
Article 5 When a company conducts commodity futures trading, it shall prepare a feasibility analysis report, clarify the trading purpose, variety, quota, risk control measures, etc., and submit it to the board of directors for review.
Article 6 If commodity futures trading falls under any of the following circumstances, the decision shall be submitted to the shareholders’ meeting for review after being reviewed and approved by the board of directors:
(1) The upper limit of the transaction margin and royalties expected to be used (including the value of the collateral provided for the transaction, the credit limit of the financial institution expected to be occupied, the margin reserved for emergency measures, etc., the same below) accounts for more than 50% of the company's latest audited net profit, and the absolute amount exceeds RMB 5 million;
(2) The highest contract value held on any trading day is expected to account for more than 50% of the company's latest audited net assets, and the absolute amount exceeds RMB 50 million;
(3) Engage in commodity futures transactions not for the purpose of hedging.
Article 7 If a company is unable to perform review procedures and disclosure obligations for each commodity futures transaction due to transaction frequency, timeliness requirements, etc., it may make reasonable estimates of the scope, amount, and duration of commodity futures transactions in the next twelve months and conduct review in accordance with the provisions of these Measures. The usage period of the relevant quota should not exceed twelve months, and the amount at any point in time during the period (including the relevant amount of re-trading of the proceeds from the aforementioned transactions) should not exceed the reviewed quota.
Article 8 When a company conducts commodity futures transactions with related parties, it shall also abide by the company's "Related Transaction Management System" and relevant regulatory regulations, and perform related transaction review and disclosure procedures.
Chapter 3 Risk Control and Supervision
Article 9 The company's finance department is responsible for the opening and management of trading accounts, fund scheduling, financial accounting and voucher archiving.
Article 10 The company's finance department shall, in accordance with the company's fund management requirements, be responsible for opening and managing futures trading-related accounts, including account opening, account cancellation, use registration, etc., and shall be responsible for the management of fund transfers in and out of futures transactions, as well as the management of special fund accounts. Funds in and out of the trading account must be made in the name of the company. Lending the account or using non-company accounts for transactions is strictly prohibited.
Article 11 The company shall set up a team focusing on procurement and sales to track the progress of futures trading and investment security. When the company carries out futures trading for the purpose of hedging, it shall formulate emergency response plans, set stop-loss limits for different trading products or counterparties, clarify the stop-loss process and strictly implement it; designate dedicated personnel to track transaction progress and market price changes, assess risk exposures in a timely manner, and regularly report transaction execution, risk assessment, profits and losses, and stop-loss execution to the management and the board of directors.
Article 12 Personnel engaged in futures business of the company must have written authorization from the company. Authorization includes transaction authorization and transaction fund allocation authorization. Authorized trading personnel and fund allocation personnel should be kept independent and mutually restrictive. The company's authorized personnel shall conduct futures trading operations within the investment scale and bearable risk limits approved by the board of directors or shareholders' meeting, and shall not engage in any unauthorized futures trading operations.
Article 13 The company’s internal audit department is responsible for auditing and supervising the approval procedures, actual operations, and fund usage of commodity futures trading, and conducts special inspections at least once every six months and issues inspection reports to the audit committee.
Article 14 The company’s audit committee is responsible for reviewing the necessity, feasibility and risk control of commodity futures trading, and may hire a professional agency to issue a feasibility analysis report when necessary.
Article 15 Anyone who violates this system and relevant regulations or fails to perform their duties and causes losses to the company will be held accountable and required to compensate for the losses.
Chapter 4 Information Disclosure
Article 16 Companies shall, in accordance with the relevant regulations of the Shenzhen Stock Exchange, promptly disclose relevant information on commodity futures trading, including trading purposes, varieties, venues, margin limits, maximum contract values, professional staffing and risk warnings, etc.
Article 17 Whenever the amount of confirmed profits and losses and floating losses from commodity futures trading reaches 10% of the company's audited net profit attributable to shareholders in the most recent year and the absolute amount exceeds 10 million yuan, it shall be disclosed in a timely manner; if hedging business is carried out, these regulations may be applied after adding up the changes in the value of the hedging instrument and the hedged project.
When a company engages in hedging business and encounters losses specified in the preceding paragraph, it shall also re-evaluate the effectiveness of the hedging relationship, disclose the reasons why the changes in the fair value or cash flow of the hedging tool and the hedged project are not offset as expected, and separately disclose the changes in the value of the hedging tool and the hedged project, etc.
Article 18 The company shall disclose in regular reports the development of commodity futures trading and the hedging effect during the reporting period.
Chapter 5 Supplementary Provisions
Article 19 Matters not covered in this system shall be implemented in accordance with relevant laws, regulations, normative documents and the Articles of Association. If this system is inconsistent with the aforementioned provisions, the relevant provisions shall prevail and this system shall be revised in a timely manner.
Article 20 The company's board of directors is responsible for formulating, revising and interpreting this system.
Article 21 This system will come into effect from the date of review and approval by the board of directors.
Board of Directors of Nanhua Biopharmaceutical Co., Ltd.
December 2025