Articles of Association of Hunan Nanxin Pharmaceutical Co., Ltd. (revised in September 2026)
Directory
Chapter 1 General Provisions......................................................................................................................................3
Chapter 2 Business Purpose and Scope................................................................................................................4
Chapter 3 Shares................................................................................................................................................4
Section 1 Share Issuance......................................................................................................................4
Section 2 Share Capital Increase and Repurchase......................................................................................................6
Section 3 Share Transfer......................................................................................................................7
Chapter 4 Shareholders and Shareholders Meeting................................................................................................................8
Section 1 Shareholders................................................................................................................................8
Section 2 Controlling Shareholders and Actual Controllers......................................................................11
Section 3 General Provisions of Shareholders’ Meetings......................................................................................12
Section 4 Convening of Shareholders’ Meeting................................................................................................14
Section 5 Proposals and Notices of Shareholders’ Meetings......................................................................15
Section 6 Convening of Shareholders’ Meeting................................................................................................16
Section 7 Voting and Resolutions of the Shareholders’ Meeting................................................................................19
Chapter 5 Board of Directors................................................................................................................................23
Section 1 Directors................................................................................................................................23
Section 2 Board of Directors................................................................................................................................27
Section 3 Independent Directors................................................................................................................31
Section 4 Special Committees of the Board of Directors......................................................................................34
Chapter 6 Senior Management................................................................................................................35
Chapter 7 Company Party Branch......................................................................................................................37
Chapter 8 Financial Accounting System, Profit Distribution and Audit......................................................................40
Section 1 Financial Accounting System......................................................................................................40
Section 2 Internal Audit......................................................................................................................44
Section 3 Appointment of Accounting Firm......................................................................................44
Chapter 9 Notices and Announcements................................................................................................................45
Section 1 Notice................................................................................................................................45
Section 2 Announcement................................................................................................................................45
Chapter 10 Merger, spin-off, capital increase, capital reduction, dissolution and liquidation......................................................45
Section 1 Mergers, Splits, Capital Increases and Capital Reductions......................................................................46
Section 2 Dissolution and Liquidation of the Company......................................................................................47
Chapter 11 Modification of the Articles of Association......................................................................................................49
Chapter 12 Supplementary Provisions................................................................................................................................49
Chapter 1 General Provisions
Article 1 In order to safeguard the legitimate rights and interests of the company, shareholders, employees and creditors, standardize the company's organization and behavior, and give full play to the political core role of the party organization of Hunan Nanxin Pharmaceutical Co., Ltd., in accordance with the Company Law of the People's Republic of China (hereinafter referred to as the "Company Law") and the "Company Law of the People's Republic of China" The Securities Law (hereinafter referred to as the "Securities Law"), the "Articles of the Communist Party of China" (hereinafter referred to as the "Party Constitution"), the "Guidelines for the Articles of Association of Listed Companies", the "Shanghai Stock Exchange Science and Technology Innovation Board Stock Listing Rules", the "Administrative Measures for the Formulation of Articles of Association of State-owned Enterprises" and other laws and regulations are formulated to formulate this Article of Association.
Article 2 The company is a joint-stock limited company established in accordance with the Company Law and other relevant regulations. The company was initiated and established as a joint-stock company based on Hunan Nanxin Pharmaceutical Co., Ltd. and was established in accordance with the law. It was registered with the Hunan Provincial Administration for Market Regulation and obtained a business license. The unified social credit code is 91430181796859207Y.
Article 3 The company was registered by the China Securities Regulatory Commission (hereinafter referred to as the "China Securities Regulatory Commission") on February 27, 2020, issued 35 million RMB ordinary shares to the public for the first time, and was listed on the Shanghai Stock Exchange on March 26, 2020.
Article 4 Company registered name: Hunan Nanxin Pharmaceutical Co., Ltd.
English name: Hunan Nucien Pharmaceutical Co., Ltd.
Article 5 Company address: No. 1, Kangli Road, Liuyang Economic and Technological Development Zone, Changsha City.
Article 6 The registered capital of the company is RMB 272,829,414.
Article 7 The company's business term: it is a joint-stock company with permanent existence.
Article 8 The chairman of the board of directors is the legal representative of the company. If the chairman of the board of directors resigns, he shall be deemed to have resigned as the legal representative at the same time. If the legal representative resigns, the company will determine a new legal representative within thirty days from the date of resignation.
Article 9 The legal consequences of civil activities conducted by the legal representative in the name of the company shall be borne by the company. The restrictions on the powers of the legal representative in this Articles of Association or the shareholders' meeting shall not antagonize bona fide counterparties. If the legal representative causes damage to others due to the performance of his duties, the company shall bear civil liability. After the company assumes civil liability, it may recover compensation from the at-fault legal representative in accordance with the provisions of the law or these Articles of Association.
Article 10 Shareholders shall bear liability for the company to the extent of the shares they subscribe for, and the company shall bear liability for the company's debts with all of its property.
Article 11 From the effective date of this Articles of Association, it will become a legally binding document that regulates the organization and behavior of the company, the rights and obligations between the company and shareholders, and shareholders, and is a legally binding document for the company, shareholders, directors, and senior managers. According to this Article of Association, shareholders can sue shareholders, shareholders can sue company directors and senior managers, shareholders can sue the company, and companies can sue shareholders, directors and senior managers.
Article 12 The term "senior management personnel" as mentioned in these Articles of Association refers to the company's general manager, deputy general manager, financial controller, secretary to the board of directors and other personnel specified in these Articles of Association.
Article 13 The company shall, in accordance with the Constitution of the Communist Party of China, establish party organizations, carry out party activities, establish party working institutions, staff and strengthen party affairs staff, and ensure the working funds of the party organizations.
Chapter 2 Business Purpose and Scope
Article 14 The company's business purpose: With the spirit of innovation, professional management, and the concept of cooperation, continuously improve the company's core competitiveness, actively explore the market, pursue the company's sustainable and stable development, strive to enhance the company's value, and maximize the interests of shareholders and society.
Article 15 After registration in accordance with the law, the company's business scope: manufacturing and sales of chemical preparations, chemical raw materials, biological drugs, chemical reagents and auxiliaries (excluding hazardous chemicals and monitoring products); research and development of chemical products, drugs, and biological products (excluding hazardous chemicals and monitoring products); self-operation and agency import and export of various commodities and technologies. (Projects that require approval according to law can only carry out business activities after approval from relevant departments).
Chapter 3 Shares
Section 1 Share Issuance
Article 16 The company's shares shall be in the form of stocks.
Article 17 The issuance of company shares shall be based on the principles of openness, fairness and impartiality, and each share of the same type shall have equal rights.
For shares of the same type issued at the same time, the issuance conditions and price for each share are the same, and subscribers pay the same price for each share subscribed.
Article 18 The par value of shares issued by the company shall be expressed in RMB.
Article 19 The shares issued by the company shall be centrally deposited at the Shanghai Branch of China Securities Depository and Clearing Co., Ltd.
Article 20 The company was transformed from Hunan Nanxin Pharmaceutical Co., Ltd. based on the audited book net asset value as of October 31, 2017. The promoters used their net assets corresponding to the equity of Hunan Nanxin Pharmaceutical Co., Ltd. to subscribe for all the shares when the company was established. The names of the promoters, the number of shares subscribed, and the time of investment are as follows:
License number
Name of sponsor Amount of capital contribution Capital contribution
(Unified Social Credit Code Capital Funding Method Investment Time or Name (10,000 Yuan) Percentage
/Registration number/ID number)
Subscribe 4000 net assets
Hunan Xiangtou Holding Group
914300001837668179 38.10% 2017-10-31 Co., Ltd. Paid-in 4000 Net assets
Subscribed 2200 net assets
Guangzhou Qianyuan Investment Management Enterprise
91440101304536293T 20.95% 2017-10-31 (Limited partnership) Paid-in 2200 Net assets
Subscribe 1500 net assets
Hangzhou Dinghui New Trend Equity Investment Co., Ltd.
91330109352493582L 14.29% 2017-10-31 Partnership (limited partnership) Paid-in 1500 Net assets
Subscribe 500 net assets
Hunan Xiangjiang Health Venture Capital Partnership
91430100394035926G 4.76% 2017-10-31 Partnership (limited partnership) Paid-in 500 Net assets
Subscribe 450 net assets
Hunan Province Houshui Investment Partnership
91430100567691447D 4.29% 2017-10-31 (Limited partnership) Paid-in 450 Net assets
Subscribe 450 net assets
Hangzhou Xinweixitai Investment Partnership
91330102MA27XY8E5C 4.29% 2017-10-31 Business (limited partnership) Paid-in 450 Net assets
Subscribed 420.50 net assets
Shenzhen Jianning Yinchuang Investment
914403005731234030 4.00% 2017-10-31 Co., Ltd. Paid-in 420.50 Net assets
Subscribe 300 net assets
Shenzhen Shangbang Investment Management Co., Ltd.
91440300MA5FJH0F23 2.86% 2017-10-31 Division paid in 300 Net assets
Subscribed 279.50 Net assets
Ye Shengli 430204196102220017 2.66% 2017-10-31
Paid-in 279.50 Net assets
Guangzhou Tinglin Investment Management subscribed 200 net assets
91440101MA59K0XN1D 1.90% 2017-10-31 Co., Ltd. Paid-in 200 Net assets
Shenzhen Nanfang Huipeng Investment Company subscribed 200 net assets
91440300319543082A 1.90% 2017-10-31 (limited partnership)
Paid-in 200 net assets
Total —— —— 10,500 ---- 100% ——
Article 21 The number of issued shares of the company is 272,829,414 shares. The company's capital structure: 272,829,414 ordinary shares and no other types of shares.
Article 22 The company or its subsidiaries (including its affiliated enterprises) shall not provide financial assistance for others to obtain shares of the company or its parent company in the form of gifts, advances, guarantees, loans, etc., unless the company implements an employee stock ownership plan.
For the benefit of the company, upon resolution of the shareholders' meeting, or the board of directors making a resolution in accordance with the Articles of Association or the authorization of the shareholders' meeting, the company may provide financial assistance to others to acquire shares of the company or its parent company, but the cumulative total of financial assistance shall not exceed 10% of the total issued share capital. Resolutions made by the board of directors must be approved by more than two-thirds of all directors.
Section 2 Share Capital Increase and Repurchase
Article 23 Based on the needs of operation and development, in accordance with the provisions of laws and regulations, and upon resolution of the shareholders' meeting, the company may increase capital in the following ways:
(1) Issuance of shares to unspecified objects;
(2) Issuance of shares to specific objects;
(3) Distribute bonus shares to existing shareholders;
(4) Convert public reserve funds into share capital;
(5) Other methods prescribed by laws, administrative regulations and the China Securities Regulatory Commission.
Article 24 A company may reduce its registered capital. When a company reduces its registered capital, it shall do so in accordance with the Company Law and other relevant regulations and the procedures stipulated in these Articles of Association.
Article 25 A company may not acquire its own shares. However, except for one of the following circumstances:
(1) Reduce the company’s registered capital;
(2) Merge with other companies that hold shares of the company;
(3) Use shares for employee stock ownership plans or equity incentives;
(4) Shareholders dissent from the company’s merger or division resolution made by the shareholders’ meeting and request the company to acquire their shares;
(5) Use the shares to convert corporate bonds issued by the company that can be converted into stocks;
(6) Necessary for the company to maintain the company's value and shareholders' rights and interests.
Article 26 A company may acquire its own shares through public centralized transactions or other methods approved by laws, administrative regulations and the China Securities Regulatory Commission.
If the company acquires the company's shares due to the circumstances stipulated in Items (3), (5) and (6) of Article 25 of this Article, it shall conduct it through public centralized transactions.
Article 27 If the company acquires the company's shares due to the circumstances stipulated in Article 25 (1) and (2) of the Articles of Association, it shall obtain a resolution from the shareholders' meeting. If the company acquires the company's shares due to the circumstances specified in Article 25 (3), (5) and (6) of the Articles of Association, it may, in accordance with the provisions of the Articles of Association or the authorization of the shareholders' meeting, pass a resolution at a board meeting attended by more than two-thirds of the directors.
After the company acquires the company's shares in accordance with the provisions of Article 25 of the Articles of Association, if it falls under the circumstances of item (1), it shall be canceled within 10 days from the date of acquisition; if it falls under the circumstances of items (2) and (4), it shall be transferred or canceled within 6 months. If it falls under the circumstances of Items (3), (5) and (6), the total number of shares of the company held by the company shall not exceed 10% of the total number of issued shares of the company, and shall be transferred or canceled within three years.
Section 3 Share Transfer
Article 28 The company's shares shall be transferred in accordance with the law.
Article 29 A company shall not accept its own shares as the subject of pledge.
Article 30 The shares issued before the company's public issuance of shares shall not be transferred within one year from the date the company's shares are listed and traded on the stock exchange.
Directors and senior managers of a company shall report to the company the shares they hold and the changes in the company's shares. The shares transferred each year during the term of office determined at the time of taking office shall not exceed 25% of the total number of shares of the same category held by them in the company; the company shares they hold shall not be transferred within one year from the date of listing of the company's shares. The above-mentioned personnel shall not transfer the company shares held by them within six months after their resignation.
If laws, administrative regulations or the China Securities Regulatory Commission have other provisions on the transfer of the shares of the company held by shareholders, such provisions shall prevail.
Article 31 If a company's directors, senior managers, or shareholders holding more than 5% of the company's shares sell the company's stocks or other equity-type securities they hold within 6 months of purchase, or purchase them again within 6 months of sale, the proceeds shall belong to the company, and the company's board of directors will take back the proceeds. However, securities companies holding more than 5% of the shares due to underwriting the purchase of remaining stocks after the sale are excluded, as well as other circumstances stipulated by the China Securities Regulatory Commission.
The stocks or other equity-type securities held by directors, senior managers, and natural person shareholders referred to in the preceding paragraph include stocks or other equity-type securities held by their spouses, parents, and children and those held using the accounts of others.
If the company's board of directors fails to implement the provisions of paragraph 1 of this article, the shareholders have the right to request the board of directors to implement it within 30 days. If the company's board of directors fails to implement the decision within the above time limit, shareholders have the right to file a lawsuit directly with the People's Court in their own name for the benefit of the company.
If the company's board of directors fails to comply with the provisions of paragraph 1 of this article, the responsible directors shall bear joint and several liability in accordance with the law.
Chapter 4 Shareholders and Shareholders’ Meeting
Section 1 Shareholders
Article 32 The company shall establish a shareholder list based on the certificates provided by the securities registration and clearing agency. The shareholder list is sufficient evidence to prove that shareholders hold the company's shares. Shareholders enjoy rights and assume obligations according to the class of shares they hold; shareholders holding the same class of shares enjoy the same rights and assume the same obligations.
Article 33 When a company convenes a shareholders' meeting, distributes dividends, liquidates, or engages in other actions that require confirmation of the identity of shareholders, the board of directors or the convener of the shareholders' meeting shall determine the equity registration date. Shareholders registered after the market close on the equity registration date shall be shareholders who enjoy relevant rights and interests.
Article 34 Shareholders of the company enjoy the following rights:
(1) Receive dividends and other forms of benefit distribution based on the share of shares held;
(2) Request to convene, convene, host, participate in, or appoint shareholders’ agents to participate in shareholders’ meetings in accordance with the law, and exercise corresponding voting rights;
(3) Supervise the company’s operations and make suggestions or inquiries;
(4) Transfer, donate or pledge the shares it holds in accordance with the provisions of laws, administrative regulations and these Articles of Association;
(5) Check and copy the company's articles of association, shareholder list, shareholders' meeting minutes, board meeting resolutions, and financial accounting reports. Shareholders who meet the regulations may check the company's accounting books and accounting vouchers;
(6) When the company is terminated or liquidated, participate in the distribution of the company's remaining property according to the share of shares it holds;
(7) Shareholders who object to the company merger or division resolution made by the shareholders’ meeting require the company to acquire their shares;
(8) Other rights stipulated in laws, administrative regulations, departmental rules or this Article.
Article 35 If a shareholder requests to review or copy relevant materials of the company, he shall abide by the provisions of the Company Law, Securities Law and other laws and administrative regulations, and shall provide the company with written documents proving the type and number of shares he holds in the company. The company shall provide it according to the reasonable request of the shareholder after verifying the identity of the shareholder.
Article 36 If the content of the resolutions of the company's shareholders' meeting or board of directors violates laws and administrative regulations, shareholders have the right to request the People's Court to invalidate the resolutions.
If the convening procedures and voting methods of the shareholders' meeting or the board of directors violate laws, administrative regulations or the Articles of Association, or the content of the resolution violates the Articles of Association, shareholders have the right to request the People's Court to revoke the resolution within 60 days from the date the resolution is made. However, there are only minor flaws in the convening procedures or voting methods of shareholders' meetings and board of directors meetings, except those that have no substantial impact on the resolutions.
If the board of directors, shareholders and other relevant parties have disputes over the validity of the resolutions of the shareholders' meeting, they should promptly file a lawsuit with the people's court. Before the people's court makes a judgment or ruling such as revoking the resolution, the relevant parties shall implement the resolution of the shareholders' meeting. The company, directors and senior managers should effectively perform their duties and ensure the normal operation of the company. If the people's court makes a judgment or ruling on relevant matters, the company shall perform its information disclosure obligations in accordance with laws, administrative regulations, the provisions of the China Securities Regulatory Commission and the stock exchange, fully explain the impact, and actively cooperate with the implementation after the judgment or ruling takes effect. If it involves the correction of previous matters, it will be handled in a timely manner and the corresponding information disclosure obligations will be fulfilled.
Article 37 If any of the following circumstances occurs, the resolution of the company’s shareholders’ meeting or board of directors shall be invalid:
(1) No shareholders’ meeting or board of directors meeting was held to make resolutions;
(2) The shareholders’ meeting and the board of directors’ meeting did not vote on resolution matters;
(3) The number of people attending the meeting or the number of voting rights held does not reach the number or number of voting rights stipulated in the Company Law or these Articles of Association;
(4) The number of people or the number of voting rights they hold who agree to the resolution does not reach the number of people or the number of voting rights they hold as stipulated in the Company Law or these Articles of Association.
Article 38 If a director or senior manager other than a member of the audit committee violates laws, administrative regulations or the provisions of these Articles of Association when performing the company's duties and causes losses to the company, shareholders who individually or collectively hold more than 1% of the company's shares for more than 180 consecutive days have the right to request the audit committee in writing to file a lawsuit with the People's Court; if the audit committee violates laws, administrative regulations or the provisions of the Articles of Association when performing the company's duties and causes losses to the company, the aforementioned shareholders may request the board of directors in writing to file a lawsuit with the People's Court.
If the audit committee or the board of directors refuses to file a lawsuit after receiving a written request from a shareholder as stipulated in the preceding paragraph, or fails to file a lawsuit within 30 days from the date of receipt of the request, or the situation is urgent and failure to file a lawsuit immediately will cause irreparable damage to the company's interests, the shareholders stipulated in the preceding paragraph have the right to directly file a lawsuit with the People's Court in their own name for the benefit of the company.
If others infringe upon the company's legitimate rights and interests and cause losses to the company, the shareholders specified in the first paragraph of this article may file a lawsuit with the People's Court in accordance with the provisions of the previous two paragraphs.
If directors or senior managers of a company's wholly-owned subsidiaries violate laws, administrative regulations or the provisions of these Articles of Association when performing their duties, causing losses to the company, or if others infringe upon the legitimate rights and interests of the company's wholly-owned subsidiaries and cause losses, shareholders who individually or collectively hold more than 1% of the company's shares for more than 180 consecutive days may request in writing the supervisory board or board of directors of the wholly-owned subsidiary to file a lawsuit with the People's Court in accordance with the first three paragraphs of Article 189 of the "Company Law" or directly file a lawsuit with the People's Court in their own names.
If a company's wholly-owned subsidiary does not have a board of supervisors or supervisors, but has an audit committee, the provisions of paragraphs 1 and 2 of this article shall apply.
Article 39 If directors or senior managers violate laws, administrative regulations or the provisions of these Articles of Association and harm the interests of shareholders, shareholders may file a lawsuit in the People's Court.
Article 40 Shareholders of the company shall bear the following obligations:
(1) Comply with laws, administrative regulations and this charter;
(2) Pay the share price according to the shares subscribed and the method of subscription;
(3) Except under circumstances stipulated by laws and regulations, its share capital shall not be withdrawn;
(4) Shall not abuse the rights of shareholders to harm the interests of the company or other shareholders; must not abuse the independent status of a company as a legal person and the limited liability of shareholders to harm the interests of the company’s creditors;
(5) Other obligations stipulated in laws, administrative regulations and this Articles of Association.
Article 41 If a company's shareholders abuse their rights and cause losses to the company or other shareholders, they shall be liable for compensation in accordance with the law. If a company's shareholders abuse the company's independent status as a legal person and the limited liability of shareholders, evade debts and seriously damage the interests of the company's creditors, they shall bear joint and several liability for the company's debts.
Section 2 Controlling Shareholders and Actual Controllers
Article 42 The controlling shareholders and actual controllers of a company shall exercise their rights and perform their obligations in accordance with laws, administrative regulations, provisions of the China Securities Regulatory Commission and stock exchanges, and safeguard the interests of listed companies.
Article 43 The company’s controlling shareholders and actual controllers shall comply with the following provisions:
(1) Exercise shareholders’ rights in accordance with the law, and do not abuse control rights or use affiliated relationships to damage the legitimate rights and interests of the company or other shareholders;
(2) Strictly implement the public statements and commitments made, and shall not make any changes or exemptions without authorization;
(3) Perform information disclosure obligations in strict accordance with relevant regulations, actively cooperate with the company in information disclosure, and promptly inform the company of major events that have occurred or are expected to occur;
(4) Company funds shall not be appropriated in any way;
(5) The company and relevant personnel shall not be forced, instigated or required to provide guarantees in violation of laws and regulations;
(6) Not to use the company's undisclosed major information to seek benefits, not to leak any undisclosed major information related to the company in any way, and not to engage in insider trading, short-term trading, market manipulation and other illegal activities;
(7) The legitimate rights and interests of the company and other shareholders shall not be harmed through unfair related transactions, profit distribution, asset restructuring, external investment, etc. in any way;
(8) Ensure the company’s asset integrity, personnel independence, financial independence, organizational independence and business independence, and shall not affect the company’s independence in any way;
(9) Other provisions of laws, administrative regulations, provisions of the China Securities Regulatory Commission, business rules of stock exchanges and these Articles of Association.
If the company's controlling shareholder or actual controller does not serve as a director of the company but actually performs the company's affairs, the provisions of this Articles on directors' duties of loyalty and diligence shall apply.
If a company's controlling shareholder or actual controller instructs a director or senior manager to engage in behavior that damages the interests of the company or shareholders, he shall be jointly and severally liable with the director or senior manager.
Article 44 If a controlling shareholder or actual controller pledges the company's stocks held or actually controlled by him or her, the company's control rights and production and operation stability shall be maintained.
Article 45 When controlling shareholders and actual controllers transfer the shares of the company they hold, they must comply with the restrictive provisions on share transfers in laws, administrative regulations, regulations of the China Securities Regulatory Commission and stock exchanges, and the commitments they have made to restrict share transfers.
Section 3 General Provisions of Shareholders’ Meetings
Article 46 The company’s shareholders’ meeting shall be composed of all shareholders. The shareholders' meeting is the company's authority and exercises the following powers in accordance with the law:
(1) Elect and replace directors, and decide on remuneration matters for directors;
(2) Review and approve the report of the board of directors;
(3) Review and approve the company’s profit distribution plan and loss compensation plan;
(4) Make a resolution to increase or decrease the company’s registered capital;
(5) Make a resolution on the issuance of corporate bonds;
(6) Make resolutions on the merger, division, dissolution, liquidation or change of company form;
(7) Modify this Articles of Association;
(8) Make a resolution on the company’s hiring and dismissal of the accounting firm that handles the company’s audit business;
(9) Review and approve the guarantee matters stipulated in Article 47 of these Articles of Association;
(10) Review the company’s purchase and sale of major assets within one year exceeding 30% of the company’s latest audited total assets;
(11) Review and approve changes in the use of raised funds;
(12) Review equity incentive plans and employee stock ownership plans;
(13) Review other matters that should be decided by the shareholders’ meeting as stipulated in laws, administrative regulations, departmental rules or these Articles of Association.
The shareholders' meeting can authorize the board of directors to make a resolution on the issuance of corporate bonds.
The company may issue stocks and corporate bonds convertible into stocks upon resolution of the shareholders' meeting, or by resolution of the board of directors upon authorization by the Articles of Association or the shareholders' meeting. The specific implementation shall comply with laws, administrative regulations, the provisions of the China Securities Regulatory Commission and stock exchanges.
Unless otherwise provided by laws, administrative regulations, provisions of the China Securities Regulatory Commission or rules of stock exchanges, the powers of the above-mentioned shareholders' meeting shall not be exercised by the board of directors or other institutions and individuals through authorization.
Article 47 If a guarantee matter falls under any of the following circumstances, it shall be submitted to the shareholders' meeting for review after being reviewed and approved by the board of directors:
(1) A single guarantee amount exceeds 10% of the company’s latest audited net assets;
(2) Any guarantee provided after the total amount of external guarantees provided by the company and its holding subsidiaries exceeds 50% of the company’s latest audited net assets;
(3) Guarantees provided for guarantee objects whose asset-liability ratio exceeds 70%;
(4) Guarantees that exceed 30% of the company’s latest audited total assets based on the cumulative calculation principle of the guarantee amount within 12 consecutive months;
(5) Any guarantee provided after the total amount of external guarantees provided by the company and its holding subsidiaries exceeds 30% of the company’s latest audited total assets;
(6) Guarantees provided to shareholders, actual controllers and their related parties;
(7) Other guarantees provided by the Shanghai Stock Exchange or these Articles of Association.
When the company's shareholders' meeting considers the guarantee in item (4) of the preceding paragraph, it shall be approved by more than two-thirds of the voting rights held by shareholders present at the meeting.
If the company provides guarantees for its wholly-owned subsidiaries, or provides guarantees for its controlled subsidiaries and other shareholders of the controlled subsidiaries provide guarantees in equal proportion to their rights and interests, and does not harm the interests of the company, it may be exempted from the application of the provisions of Items (1) to (3) of Paragraph 1 of this Article. The company shall summarize and disclose the aforementioned guarantees in its annual report and semi-annual report.
Article 48 Shareholders' meetings are divided into annual shareholders' meetings and extraordinary shareholders' meetings. The annual shareholders' meeting is held once a year and should be held within 6 months after the end of the previous fiscal year.
Article 49 If any of the following circumstances occurs, the company shall convene an extraordinary shareholders' meeting within 2 months from the date of occurrence:
(1) When the number of directors is less than 2/3 of the number specified in the Company Law or the number specified in these Articles of Association;
(2) When the company’s uncompensated losses reach 1/3 of its total share capital;
(3) When requested by shareholders individually or collectively holding more than 10% of the company’s shares;
(4) When the board of directors deems it necessary;
(5) When the audit committee proposes to convene;
(6) Other situations stipulated in laws, administrative regulations, departmental rules or these Articles of Association.
Article 50 The company shall hold a shareholders’ meeting at the company’s domicile or at the meeting place clearly stated in the meeting notice.
The shareholders' meeting will be held in an on-site meeting venue. The company will also provide online voting or other methods to facilitate shareholders' participation in the shareholders' meeting. Shareholders who participate in the shareholders' meeting through the above methods are deemed to be present.
Article 51 When convening a shareholders' meeting, the company will hire a lawyer to issue legal opinions on the following issues and make an announcement:
(1) Whether the convening and convening procedures of the meeting comply with the provisions of laws, administrative regulations, and these Articles of Association;
(2) Whether the qualifications of the persons attending the meeting and the qualifications of the convener are legal and valid;
(3) Whether the voting procedures and voting results of the meeting are legal and valid;
(4) Legal opinions on other relevant issues at the request of the company.
Section 4: Convening of Shareholders’ Meeting
Article 52 The board of directors shall convene the shareholders’ meeting on time within the prescribed time limit.
With the approval of more than half of all independent directors, the independent directors have the right to propose to the board of directors to convene an extraordinary shareholders' meeting. Regarding the independent directors' proposal to convene an extraordinary shareholders' meeting, the board of directors shall provide written feedback on whether it agrees or disagrees with convening an extraordinary shareholders' meeting within 10 days after receiving the proposal in accordance with the provisions of laws, administrative regulations and these Articles of Association. If the board of directors agrees to convene an extraordinary shareholders' meeting, it shall issue a notice of convening the shareholders' meeting within 5 days after making the board resolution; if the board of directors does not agree to convene an extraordinary shareholders' meeting, it shall explain the reasons and make an announcement.
Article 53 If the audit committee proposes to the board of directors to convene an extraordinary shareholders' meeting, it shall submit the proposal to the board of directors in writing. The board of directors shall provide written feedback on whether it agrees or disagrees to convene an extraordinary shareholders' meeting within 10 days after receiving the proposal in accordance with the provisions of laws, administrative regulations and these Articles of Association.
If the board of directors agrees to convene an extraordinary shareholders' meeting, it will issue a notice to convene the shareholders' meeting within 5 days after the board of directors' resolution is made. Any changes to the original proposal in the notice must be approved by the audit committee.
If the board of directors does not agree to convene an extraordinary shareholders' meeting, or fails to provide feedback within 10 days after receiving the proposal, it will be deemed that the board of directors is unable or fails to perform its duty to convene a shareholders' meeting, and the audit committee may convene and preside over it on its own.
Article 54 Shareholders who individually or jointly hold more than 10% of the company's shares shall request the board of directors to convene an extraordinary shareholders' meeting and shall submit the request to the board of directors in writing. The board of directors shall provide written feedback on whether it agrees or disagrees to convene an extraordinary shareholders' meeting within 10 days after receiving the request in accordance with the provisions of laws, administrative regulations and these Articles of Association.
If the board of directors agrees to convene an extraordinary shareholders' meeting, it shall issue a notice to convene the shareholders' meeting within 5 days after making the board of directors' resolution. Any changes to the original request in the notice must obtain the consent of the relevant shareholders.
If the board of directors does not agree to convene an extraordinary shareholders' meeting, or fails to provide feedback within 10 days after receiving the request, shareholders who individually or collectively hold more than 10% of the company's shares propose to the audit committee to convene an extraordinary shareholders' meeting, and shall submit a request to the audit committee in writing.
If the audit committee agrees to convene an extraordinary shareholders' meeting, it shall issue a notice to convene the shareholders' meeting within 5 days after receiving the request. Any changes to the original request in the notice must be approved by the relevant shareholders.
If the audit committee fails to issue a shareholders' meeting notice within the prescribed period, it will be deemed that the audit committee has not convened and presided over the shareholders' meeting. Shareholders who individually or collectively hold more than 10% of the company's shares for more than 90 consecutive days may convene and preside over it on their own.
Article 55 If the audit committee or shareholders decide to convene a shareholders' meeting on their own, they must notify the board of directors in writing and file it with the stock exchange.
Before the resolution of the shareholders' meeting is announced, the shareholding ratio of the convening shareholders shall not be less than 10%.
The audit committee or convening shareholders shall submit relevant supporting materials to the stock exchange when issuing the notice of the shareholders' meeting and the announcement of the resolutions of the shareholders' meeting.
Article 56 The board of directors and the secretary of the board of directors will cooperate with the shareholders' meeting convened by the audit committee or shareholders themselves. The board of directors shall provide a list of shareholders on the equity registration date.
Article 57 For a shareholders' meeting convened by the audit committee or shareholders themselves, the necessary expenses for the meeting shall be borne by the company.
Section 5 Proposals and Notices of Shareholders’ Meetings
Article 58 The content of the proposal shall fall within the scope of the shareholders' meeting, have clear topics and specific resolution matters, and comply with the relevant provisions of laws, administrative regulations and these Articles of Association.
Article 59 When a company convenes a shareholders' meeting, the board of directors, audit committee and shareholders individually or jointly holding more than 1% of the company's shares have the right to submit proposals to the company.
Shareholders who individually or collectively hold more than 1% of the company's shares may put forward temporary proposals and submit them in writing to the convener 10 days before the shareholders' meeting. The convener shall issue a supplementary notice to the shareholders' meeting within 2 days after receiving the proposal, announce the contents of the temporary proposal, and submit the temporary proposal to the shareholders' meeting for review. Exceptions are made for temporary proposals that violate laws, administrative regulations or the provisions of these Articles of Association, or do not fall within the scope of the shareholders' meeting.
Except for the circumstances specified in the preceding paragraph, the convener shall not modify the proposals listed in the notice of the shareholders' meeting or add new proposals after issuing the notice of the shareholders' meeting.
Proposals that are not listed in the notice of the shareholders' meeting or do not comply with the provisions of these Articles of Association shall not be voted on and resolutions made by the shareholders' meeting.
Article 60 When convening an annual shareholders' meeting, the convener shall notify all shareholders by means of an announcement 20 days before the meeting; for an extraordinary shareholders' meeting, all shareholders shall be notified by means of an announcement 15 days before the meeting.
Article 61 The notice of shareholders’ meeting shall include the following contents:
(1) Time, place and duration of the meeting;
(2) Matters and proposals submitted to the meeting for consideration;
(3) Explain in clear words: All ordinary shareholders (including preference shareholders whose voting rights have been restored), shareholders holding special voting shares and other shareholders have the right to attend the shareholders' meeting, and may entrust a written proxy to attend the meeting and participate in voting. The shareholder's proxy does not have to be a shareholder of the company;
(4) Equity registration date of shareholders who have the right to attend the shareholders’ meeting;
(5) Name and telephone number of the permanent contact person for conference affairs;
(6) Voting time and voting procedures online or by other means.
Article 62 If the shareholders’ meeting intends to discuss the election of directors, the shareholders’ meeting notice will fully disclose the detailed information of the director candidates, including at least the following:
(1) Educational background, work experience, part-time job and other personal information;
(2) Whether there is a related relationship with the company or the company’s controlling shareholder and actual controller;
(3) Number of shares held in the company;
(4) Whether you have been punished by the China Securities Regulatory Commission and other relevant departments or the stock exchange. Except for the cumulative voting system to elect directors, each director candidate shall be submitted as a separate proposal.
Article 63 After the notice of the shareholders' meeting is issued, the shareholders' meeting shall not be postponed or canceled without justifiable reasons, and the proposals listed in the notice of the shareholders' meeting shall not be cancelled. In the event of postponement or cancellation, the convener shall make an announcement and explain the reasons at least 2 working days before the original date.
Section 6 Convening of Shareholders’ Meeting
Article 64 The company's board of directors and other conveners will take necessary measures to ensure the normal order of the shareholders' meeting. Measures will be taken to stop any behavior that interferes with shareholders' meetings, provokes troubles and infringes upon the legitimate rights and interests of shareholders, and will be reported to relevant departments for investigation and punishment in a timely manner.
Article 65 All ordinary shareholders or their agents registered on the equity registration date have the right to attend the shareholders' meeting and exercise their voting rights in accordance with relevant laws, regulations and these Articles of Association.
Shareholders may attend the shareholders' meeting in person or entrust a proxy to attend and vote on their behalf.
Article 66 If an individual shareholder attends a meeting in person, he or she shall present his or her identity card or other valid certificate or certificate that can indicate his or her identity; if he or she attends the meeting on behalf of another person, he or she shall present his or her valid identity card or shareholder's power of attorney.
Legal person shareholders shall be represented by their legal representative or an agent entrusted by the legal representative to attend the meeting. If the legal representative attends the meeting, he or she shall present his/her identity card and a valid certificate that proves his or her qualifications as a legal representative; if an agent attends the meeting, the agent shall present his/her identity card and a written power of attorney issued by the legal representative of the legal person shareholder unit in accordance with the law.
Article 67 The power of attorney issued by a shareholder to entrust others to attend the shareholders’ meeting shall specify the following contents:
(1) The name of the client, the type and number of company shares held;
(2) The name of the agent;
(3) Specific instructions from shareholders, including instructions to vote in favor, against or abstain from voting on each matter included in the agenda of the shareholders’ meeting;
(4) The date of issuance and validity period of the power of attorney;
(5) Signature (or seal) of the principal. If the client is a legal person shareholder, the seal of the legal person entity shall be affixed.
Article 68 If the power of attorney for proxy voting is signed by another person authorized by the principal, the power of attorney or other authorization documents authorizing the signing shall be notarized. The notarized power of attorney or other authorization document, and the voting proxy form must be kept at the company's domicile or other place specified in the notice convening the meeting.
Article 69 The company is responsible for preparing a meeting register of attendees. The meeting register shall contain the names (or names of units) of the participants, ID numbers, the number of shares held or represented with voting rights, the names of the principals (or names of units) and other matters.
Article 70 The convener and the lawyer hired by the company will jointly verify the legality of shareholder qualifications based on the shareholder list provided by the securities registration and clearing agency, and register the names of shareholders and the number of shares with voting rights they hold. Registration for the meeting shall be terminated before the host of the meeting announces the number of shareholders and proxies present at the meeting and the total number of shares with voting rights held.
Article 71 If the shareholders' meeting requires directors and senior managers to attend the meeting, the directors and senior managers shall attend the meeting and accept inquiries from shareholders.
Article 72 The shareholders' meeting shall be presided over by the chairman of the board of directors. When the chairman of the board of directors is unable or fails to perform his duties, the vice chairman shall preside over the meeting; when the vice chairman is unable or fails to perform his duties, a director jointly elected by more than half of the directors shall preside over the meeting.
The shareholders' meeting convened by the audit committee shall be presided over by the convener of the audit committee. If the convener of the Audit Committee is unable or fails to perform his duties, an Audit Committee member jointly elected by more than half of the Audit Committee members shall preside.
A shareholders' meeting convened by shareholders themselves shall be presided over by the convener or his elected representative.
When convening a shareholders' meeting, if the presiding officer violates the rules of procedure and the meeting cannot continue, with the consent of more than half of the shareholders present at the meeting with voting rights, the shareholders' meeting may elect one person to serve as the presiding officer of the meeting and continue the meeting.
Article 73 The company shall formulate rules of procedure for the shareholders' meeting, specifying in detail the convening, convening and voting procedures of the shareholders' meeting, including notification, registration, review of proposals, voting, counting of votes, announcement of voting results, formation of meeting resolutions, meeting minutes and their signing, announcements, etc., as well as the principles for authorization of the board of directors at the shareholders' meeting, and the authorization content shall be clear and specific.
Article 74 At the annual shareholders' meeting, the board of directors shall report to the shareholders' meeting on its work over the past year, and each independent director shall also make a performance report. The annual performance report of the independent directors shall be disclosed at the latest when the company issues a notice of the annual shareholders' meeting.
Article 75 Directors and senior managers shall provide explanations and explanations to shareholders’ inquiries and suggestions at shareholders’ meetings.
Article 76 The host of the meeting shall announce the number of shareholders and agents attending the meeting on-site and the total number of shares holding voting rights before voting. The number of shareholders and agents attending the meeting on-site and the total number of shares holding voting rights shall be subject to the meeting registration.
Article 77 The shareholders' meeting shall have meeting minutes, which shall be held by the secretary of the board of directors.
The minutes of the meeting record the following:
(1) Meeting time, location, agenda and name of the convener;
(2) The names of the host of the meeting and the directors and senior managers attending the meeting;
(3) The number of shareholders and proxies attending the meeting, the total number of shares with voting rights held and their proportion to the total number of shares of the company;
(4) The deliberation process, key points and voting results of each proposal;
(5) Shareholders’ inquiries or suggestions and corresponding replies or explanations;
(6) Names of lawyers, counters, and scrutineers;
(7) Other contents that should be included in the meeting minutes as stipulated in this charter.
Article 78 The convener shall ensure that the contents of the meeting minutes are true, accurate and complete. Directors, board secretaries, conveners or their representatives and meeting presiding officers who attend or attend the meeting shall sign on the meeting minutes. The minutes of the meeting shall be kept together with the signature booklet of shareholders present on site, the power of attorney of the proxy attending, and the valid information on voting status via the Internet and other methods, and the retention period shall be no less than 10 years.
Article 79 The convener shall ensure that the shareholders’ meeting is held continuously until the final resolution is reached. If the shareholders' meeting is suspended or unable to make resolutions due to force majeure or other special reasons, necessary measures should be taken to resume the shareholders' meeting as soon as possible or directly terminate the shareholders' meeting and make a timely announcement. At the same time, the convener should report to the local branch of the China Securities Regulatory Commission and the stock exchange where the company is located.
Section 7 Voting and Resolutions of Shareholders’ Meeting
Article 80 The resolutions of the shareholders' meeting are divided into ordinary resolutions and special resolutions.
Ordinary resolutions made by the shareholders' meeting shall be passed by more than half of the voting rights held by shareholders attending the meeting.
Special resolutions made by the shareholders' meeting must be passed by more than two-thirds of the voting rights held by shareholders attending the meeting.
The shareholders mentioned in this article include shareholders who entrust a proxy to attend the shareholders' meeting.
Article 81 The following matters shall be passed by ordinary resolutions at the shareholders’ meeting:
(1) Work report of the board of directors;
(2) The profit distribution plan and loss compensation plan drawn up by the board of directors;
(3) Appointment and removal of board members and their remuneration and payment methods;
(4) Other matters that should be passed by special resolutions except those stipulated by laws, administrative regulations or these Articles of Association.
Article 82 The following matters shall be passed by the shareholders’ meeting through special resolutions:
(1) The company increases or decreases its registered capital;
(2) The division, spin-off, merger, dissolution and liquidation of the company;
(3) Modification of this Articles of Association;
(4) The company purchases or sells major assets or provides guarantees to others for an amount exceeding 30% of the company’s latest audited total assets within one year;
(5) Equity incentive plan;
(6) Other matters that are stipulated in laws, administrative regulations or these Articles of Association, and that are determined by the shareholders' meeting to have a significant impact on the company by ordinary resolutions and need to be passed by special resolutions.
Article 83 Shareholders shall exercise their voting rights based on the number of shares with voting rights they represent, and each share shall be entitled to one vote, except for shareholders of class shares.
When the shareholders' meeting considers major matters affecting the interests of small and medium-sized investors, the votes of small and medium-sized investors shall be counted separately. The results of individual vote counting should be disclosed to the public in a timely manner.
The company's shares held by the company have no voting rights, and such shares are not included in the total number of voting shares held by shareholders present.
If a shareholder violates the provisions of paragraphs 1 and 2 of Article 63 of the Securities Law by purchasing shares of the company with voting rights, the shares exceeding the prescribed proportion shall not exercise voting rights within 36 months after the purchase, and will not be included in the total number of shares with voting rights for shareholders present.
The board of directors, independent directors, shareholders holding more than 1% of voting shares, or investor protection institutions established in accordance with laws, administrative regulations or the provisions of the China Securities Regulatory Commission may publicly solicit shareholder voting rights. When soliciting shareholder voting rights, specific voting intentions and other information must be fully disclosed to the persons being solicited. It is prohibited to collect shareholders' voting rights in a paid or disguised manner. Except for statutory conditions, a company may not impose minimum shareholding ratio restrictions on the solicitation of voting rights.
The shareholders mentioned in the first paragraph of this article include shareholders who entrust a proxy to attend the shareholders' meeting.
Article 84 When the shareholders' meeting considers related matters related to related transactions, related shareholders shall not participate in voting, and the number of shares with voting rights they represent shall not be counted in the total number of valid votes; the announcement of the resolution of the shareholders' meeting shall fully disclose the voting status of non-related shareholders.
The avoidance and voting procedures for related shareholders are as follows: before issuing the notice of the shareholders' meeting, the convener should make a judgment on whether the relevant matters to be submitted to the shareholders' meeting for consideration constitute related transactions in accordance with the provisions of laws and regulations. If the convener determines that the relevant matters to be submitted to the shareholders' meeting for consideration constitute related transactions, the convener shall notify the related shareholders in writing and disclose the situation of related parties involved in the resolution to be considered in the notice of the shareholders' meeting. When a shareholders' meeting is convened, related shareholders should take the initiative to apply for withdrawal, and other shareholders also have the right to request the convener to withdraw from the meeting. The convener shall examine whether the shareholder is a related shareholder in accordance with relevant regulations and shall have the right to decide whether the shareholder shall recuse himself or herself.
Shareholders who have objections to the convener's decision have the right to report it to the relevant departments, or they can submit a decision to the people's court on whether there is a related relationship and whether they have voting rights. However, the exercise of the above rights by relevant shareholders will not affect the normal convening of the shareholders' meeting.
Related shareholders who should be recused may participate in the review of related transactions involving themselves, and may provide explanations and explanations to the shareholders' meeting on whether the related transactions are fair, legal and the reasons for their occurrence, etc. However, the shareholder does not have the right to participate in voting on the matter and may not serve as a shareholder representative to count the votes on the matter.
Article 85 Unless the company is in crisis or other special circumstances, the company will not enter into a contract with anyone other than directors or senior managers to hand over the management of all or important business of the company to that person unless approved by a special resolution of the shareholders' meeting.
Article 86 The list of director candidates shall be submitted to the shareholders' meeting for voting in the form of a proposal.
Nomination method for company director candidates:
(1) The board of directors and shareholders individually or jointly holding more than 3% of the company's issued shares may propose director candidates.
(2) The number of director candidates nominated by the board of directors and the above-mentioned shareholders who are qualified to nominate shall not exceed the number of directors proposed by a single nominating entity.
(3) If the above-mentioned shareholders who are qualified to nominate nominate a director candidate, they shall submit the proposal in writing to the secretary of the company's board of directors 3 days before the board meeting. The proposal should include a resume of the candidate director and a written confirmation of the candidate's agreement to accept the nomination. The above proposals will be submitted to the shareholders' meeting for voting after formal review by the board of directors.
(4) The board of directors shall report the resume and basic information of candidate directors to the shareholders' meeting.
Nomination method for independent directors of the company:
(1) The company's board of directors and shareholders individually or collectively holding more than 1% of the company's issued shares may nominate candidates for independent directors, who shall be elected and decided by the shareholders' meeting.
(2) The investor protection agency established in accordance with the law may publicly request shareholders to entrust it to exercise the right to nominate independent directors on its behalf.
The nominators specified in the preceding paragraph shall not nominate persons with whom they have an interest or other closely related persons who may affect their independent performance of duties as independent director candidates. Candidates for independent directors should make a public statement regarding their independence and other conditions for serving as independent directors.
Article 87 When the shareholders' meeting votes on the election of directors, the cumulative voting system may be implemented in accordance with the provisions of these articles of association or the resolution of the shareholders' meeting.
If the shareholders' meeting elects two or more independent directors, a cumulative voting system shall be implemented.
The cumulative voting system mentioned in the preceding paragraph means that when the shareholders' meeting elects directors, each share has the same voting rights as the number of directors to be elected, and the voting rights held by shareholders can be used collectively.
If the shareholders' meeting elects directors by cumulative voting, the votes of independent directors and non-independent directors shall be conducted separately.
The implementation details of the cumulative voting system are: When using the cumulative voting system to elect directors, each shareholder has one ballot; the ballot should list the number of shares held by the shareholder, the number of directors to be elected, and the list of all candidates, and should be sufficient to meet the functions of the cumulative voting system. Shareholders are free to allocate their voting rights among director candidates. They can disperse their votes among multiple directors or concentrate their votes on one person. The number of votes cast for a single director candidate can be higher or lower than the number of voting shares held by them, and does not need to be an integral multiple of the number of shares. However, the cumulative number of votes they cast for all director candidates must not exceed the total number of valid voting rights they have. After the voting, based on the number of votes received by all the director candidates and limited to the number of directors to be elected, the elected directors will be selected from the candidates who received the votes from high to low.
In addition to the cumulative voting system, the shareholders' meeting will vote on all proposals one by one. If there are different proposals on the same matter, they will be voted on in the order in which the proposals were submitted. Unless the shareholders' meeting is suspended or unable to make a resolution due to special reasons such as force majeure, the shareholders' meeting will not shelve proposals or refrain from voting.
Article 88 When the shareholders' meeting considers the proposal, the proposal shall not be modified. If it is changed, it shall be regarded as a new proposal and shall not be voted on at this shareholders' meeting.
Article 89 The same voting right can only choose one of on-site, online or other voting methods. In the event of repeated voting for the same voting right, the result of the first vote shall prevail.
Article 90 The shareholders' meeting shall vote by registered vote.
Article 91 Before the shareholders' meeting votes on a proposal, two shareholder representatives shall be elected to count and supervise the votes. If the matters under consideration are related to shareholders, relevant shareholders and agents are not allowed to participate in vote counting or voting supervision.
When a shareholders' meeting votes on a proposal, lawyers and shareholder representatives shall be jointly responsible for counting and supervising the votes, and the voting results shall be announced on the spot. The voting results of the resolution shall be recorded in the meeting minutes.
Company shareholders or their agents who vote online or by other means have the right to check their voting results through the corresponding voting system.
Article 92 The on-site shareholders' meeting shall not end earlier than the online or other means. The host of the meeting shall announce the voting status and results of each proposal, and declare whether the proposal is passed based on the voting results. Before the voting results are officially announced, the companies, vote counters, scrutineers, shareholders, network service providers and other relevant parties involved in the shareholders' meeting on-site, online and other voting methods have the obligation to keep the voting information confidential.
Article 93 Shareholders attending the shareholders' meeting shall express one of the following opinions on the proposals submitted for voting: agree, oppose or abstain from voting.
Votes that are not filled in, filled in incorrectly, with illegible handwriting, or votes that are not cast will be deemed as the voter giving up the right to vote, and the voting result of the number of shares held shall be counted as "abstention".
Article 94 If the presiding officer of the meeting has any doubts about the result of the resolution submitted for voting, he may organize a count of the votes cast; if the presiding officer of the meeting does not conduct a count of votes, and the shareholders or shareholders' agents present at the meeting have objections to the results announced by the presiding officer of the meeting, they have the right to request a counting of votes immediately after the voting results are announced, and the presiding officer of the meeting shall organize a counting of votes immediately.
Article 95 The resolutions of the shareholders' meeting shall be announced in a timely manner. The announcement shall list the number of shareholders and agents present at the meeting, the total number of shares with voting rights held and their proportion to the total number of shares with voting rights of the company, the voting method, the voting results of each proposal and the details of each resolution passed.
Article 96 If a proposal is not passed, or if this shareholders' meeting changes the resolution of the previous shareholders' meeting, a special reminder should be made in the announcement of the resolution of the shareholders' meeting.
Article 97 If the shareholders' meeting passes the relevant proposal for the election of directors, the new director's term of office shall be calculated from the day when the meeting passes the election resolution.
Article 98 If the shareholders' meeting notifies the proposal of distributing cash, giving away shares or converting capital reserves into share capital, the company will implement the specific plan within 2 months after the conclusion of the shareholders' meeting.
Chapter 5 Board of Directors
Section 1 Directors
Article 99 A director of a company is a natural person and cannot serve as a director of the company under any of the following circumstances:
(1) Having no capacity for civil conduct or having limited capacity for civil conduct;
(2) If a person is sentenced to a criminal penalty for corruption, bribery, misappropriation of property, misappropriation of property or undermining the order of the socialist market economy, or is deprived of political rights due to a crime, and the execution period has not expired for more than 5 years, and if he is sentenced to probation, the probation period has not exceeded 2 years from the date of expiration of the probation period;
(3) Serving as a director, factory director or general manager of a company or enterprise undergoing bankruptcy liquidation, and being personally responsible for the bankruptcy of the company or enterprise, less than 3 years have elapsed since the date of completion of the bankruptcy liquidation of the company or enterprise;
(4) Serving as the legal representative of a company or enterprise that has had its business license revoked or ordered to close down due to violation of laws, and bearing personal responsibility, and it has not been more than 3 years since the date when the company or enterprise was revoked or ordered to close down;
(5) A large amount of personal debt has not been paid off when due and is listed as a dishonest person subject to execution by the people's court;
(6) The China Securities Regulatory Commission has taken measures to prohibit entry into the securities market and the time limit has not expired;
(7) Being publicly determined by the stock exchange to be unfit to serve as a director or senior manager of a listed company, etc., and the time limit has not expired;
(8) Other contents stipulated in laws, administrative regulations or departmental rules.
The above period shall be calculated based on the deadline for the shareholders' meeting to elect the director to review the director's appointment proposal. If a director is elected or appointed in violation of the provisions of this article, the election, appointment or appointment shall be invalid. If a director encounters the circumstances described in this article during his term of office, the company will remove him from office and stop him from performing his duties.
Article 100 Directors shall be elected or replaced by the shareholders' meeting, and may be removed from their posts by the shareholders' meeting before the expiration of their term. The term of directors is 3 years and may be re-elected upon expiration of the term. Each term of an independent director is the same as that of other directors of the company. When the term expires, he or she may be re-elected, but the continuous term of office shall not exceed six years.
The term of office of a director shall be calculated from the date of taking office until the expiration of the term of the current board of directors. If a director's term of office expires and is not re-elected in time, until the re-elected director takes office, the original director shall still perform his duties as a director in accordance with the provisions of laws, administrative regulations, departmental rules and these Articles of Association.
Anyone who has served as an independent director of the company for six consecutive years shall not be nominated as a candidate for independent director of the company within 36 months from the date of this fact. For independent directors who have served before the company's initial public offering and listing, their tenure shall be counted consecutively.
Directors may concurrently serve as senior managers, but the total number of directors who concurrently serve as senior managers and directors who are employee representatives shall not exceed 1/2 of the total number of directors of the company.
Article 101 Directors shall abide by laws, administrative regulations and the provisions of these Articles of Association, have a duty of loyalty to the company, take measures to avoid conflicts between their own interests and the interests of the company, and shall not use their powers to seek improper benefits.
Directors have the following duties of loyalty to the company:
(1) Not to misappropriate the company’s property or misappropriate company funds;
(2) Company funds shall not be stored in accounts opened in his or her own name or in the names of other individuals;
(3) No bribery or other illegal income may be taken advantage of;
(4) Without reporting to the board of directors or shareholders' meeting, and passing the resolution of the board of directors or shareholders' meeting in accordance with the provisions of these Articles of Association, no contract or transaction may be made directly or indirectly with the company;
(5) No one shall take advantage of his or her position to seek business opportunities belonging to the company for himself or others, unless the report is reported to the board of directors or shareholders' meeting and passed by a resolution of the shareholders' meeting, or the company is unable to take advantage of the business opportunities in accordance with laws, administrative regulations or these Articles of Association;
(6) Without reporting to the board of directors or the shareholders' meeting and passing the resolution of the shareholders' meeting, no business of the same type as that of the company may be operated for oneself or for others;
(7) You shall not accept commissions from other people’s transactions with the company and keep them as your own;
(8) Company secrets shall not be disclosed without authorization;
(9) Shall not use its affiliated relationships to harm the interests of the company;
(10) Other loyalty obligations stipulated in laws, administrative regulations, departmental rules and this Articles of Association.
The income earned by directors in violation of the provisions of this article shall belong to the company; if they cause losses to the company, they shall be liable for compensation.
The provisions of Item (4) of Paragraph 2 of this Article shall apply when close relatives of directors and senior managers, enterprises directly or indirectly controlled by directors, senior managers or their close relatives, and related persons who have other related relationships with directors and senior managers, enter into contracts or conduct transactions with the company.
Article 102 Directors shall abide by the provisions of laws, administrative regulations and these Articles of Association, have a duty of diligence to the company, and shall exercise the reasonable care normally due to managers in performing their duties for the best interests of the company. Directors have the following diligence obligations towards the company:
(1) The rights granted by the company should be exercised prudently, conscientiously and diligently to ensure that the company’s commercial activities comply with the requirements of national laws, administrative regulations and various national economic policies, and that commercial activities do not exceed the business scope stipulated in the business license;
(2) All shareholders should be treated fairly;
(3) Keep abreast of the company’s business operations and management status;
(4) Should sign a written confirmation of the company’s regular reports to ensure that the information disclosed by the company is true, accurate and complete;
(5) Relevant information and information shall be truthfully provided to the Audit Committee and shall not hinder the Audit Committee from exercising its powers;
(6) Other diligence obligations stipulated in laws, administrative regulations, departmental rules and this Articles of Association.
Article 103 If a director fails to attend two consecutive board meetings in person or entrusts other directors to attend board meetings, he shall be deemed to be unable to perform his duties, and the board of directors shall recommend his removal to the shareholders' meeting. If an independent director fails to attend the board meeting in person for two consecutive times and does not entrust another independent director to attend on his behalf, the board of directors shall request the shareholders' meeting to remove the independent director within 30 days from the date of occurrence of this fact.
Article 104 Directors may resign before the expiration of their term of office. Directors who resign should submit a written resignation report to the company. The resignation will take effect on the date the company receives the resignation report. The company will disclose the relevant information within 2 trading days.
If the number of members of the company's board of directors falls below the legal minimum due to the resignation of a director, the original director shall still perform his duties as a director in accordance with laws, administrative regulations, departmental rules and these Articles of Association until the re-elected director takes office.
Article 105 The company shall establish a director resignation management system and clarify the safeguard measures for accountability and compensation for unfulfilled public commitments and other unfulfilled matters. When a director's resignation takes effect or his term of office expires, he must complete all transfer procedures to the board of directors. His duty of loyalty to the company and shareholders will not be automatically lifted when his resignation takes effect or his term of office ends. His obligation to keep the company's business secrets confidential will still exist after his resignation takes effect or his term of office ends. Effective until the secret becomes public information; the duration of other obligations shall be determined based on the principle of fairness, depending on the length of time between the occurrence of the incident and departure, and the circumstances and conditions under which the relationship with the company ends, but shall remain effective for at least one year after the end of the term. The responsibilities that a director shall bear due to the performance of his duties during his term of office shall not be relieved or terminated upon resignation.
Article 106 The shareholders' meeting may resolve to dismiss a director, and the dismissal shall take effect on the date the resolution is made.
If a director is dismissed before the expiration of his term without justifiable reasons, the director may request the company to compensate him.
Article 107 No director may act in his or her own name on behalf of the company or the board of directors without the provisions of these articles of association or the legal authorization of the board of directors. When a director acts in his own name, if a third party would reasonably believe that the director is acting on behalf of the company or the board of directors, the director shall state his position and identity in advance.
Article 108 If a director causes damage to others when performing company duties, the company will be liable for compensation; if a director commits intentional or gross negligence, he shall also be liable for compensation.
Directors who violate laws, administrative regulations, departmental rules or the provisions of these Articles of Association when performing their duties and cause losses to the company shall bear liability for compensation.
Section 2 Board of Directors
Article 109 The company shall have a board of directors, which shall consist of five directors, including one chairman and may have a vice chairman. The Chairman and Vice Chairman are elected by the Board of Directors with a majority of all directors.
Article 110 The board of directors shall exercise the following powers:
(1) Convene a shareholders’ meeting and report work to the shareholders’ meeting;
(2) Implement the resolutions of the shareholders’ meeting;
(3) Determine the company’s business plan and investment plan;
(4) Formulate the company’s profit distribution plan and loss compensation plan;
(5) Formulate plans for the company to increase or reduce its registered capital, issue bonds or other securities, and go public;
(6) Formulate plans for the company’s major acquisitions, acquisition of the company’s stocks, or mergers, divisions, dissolutions, and changes to the company’s form;
(7) Within the scope authorized by the shareholders' meeting, decide on the company's external investment, acquisition and sale of assets, asset mortgages, external guarantees, entrusted financial management, related transactions, external donations and other matters. Among them, the board of directors decides that the amount of external investment projects shall not exceed 50 million yuan;
(8) Decide on the establishment of the company’s internal management organization;
(9) Decide on the appointment or dismissal of the company’s general manager, secretary to the board of directors and other senior managers, and decide on their remuneration, rewards and punishments; based on the nomination of the general manager, decide on the appointment or dismissal of the company’s deputy general manager, chief financial officer and other senior managers, and decide on their remuneration, rewards and punishments;
(10) Formulate the company’s basic management system;
(11) Formulate amendment plans to this Articles of Association;
(12) Management company information disclosure matters;
(13) Propose to the shareholders’ meeting to hire or change the accounting firm to audit the company;
(14) Listen to the work report of the general manager of the company and inspect the work of the general manager;
(15) Other powers granted by laws, administrative regulations, departmental rules, these Articles of Association or the shareholders' meeting. Matters beyond the scope of authorization of the shareholders' meeting shall be submitted to the shareholders' meeting for review.
Article 111 The company's board of directors shall explain to the shareholders' meeting the non-standard audit opinions issued by certified public accountants on the company's financial report.
Article 112 The Board of Directors formulates the rules of procedure of the Board of Directors to ensure that the Board of Directors implements the resolutions of the shareholders' meeting, improves work efficiency, and ensures scientific decision-making.
The board of directors accepts the supervision of the company's party organization, establishes a communication system with the party organization on major matters, and truthfully reports the situation and provides information to the party organization.
Article 113 The board of directors shall determine the authority over external investment, acquisition and sale of assets, asset mortgages, external guarantees, entrusted financial management, related transactions, and external donations, and establish strict review and decision-making procedures; major investment projects shall organize relevant experts and professionals to conduct reviews and submit them to the shareholders' meeting for approval.
(1) If the company’s transactions (except provision of guarantees) meet one of the following standards, it shall be disclosed in a timely manner:
The total assets involved in the transaction (if there are both book value and appraisal value, whichever is higher) account for more than 10% of the company's latest audited total assets;
The transaction amount of the transaction accounts for more than 10% of the company's market capitalization (referring to the arithmetic average of the closing market capitalization of the 10 trading days before the date the company's board of directors considers the transaction, the same below);
The net assets of the transaction target (such as equity) in the most recent fiscal year account for more than 10% of the company’s market value;
The operating income related to the transaction object (such as equity) in the most recent fiscal year accounts for more than 10% of the company's audited operating income in the most recent fiscal year, and exceeds 10 million yuan;
The profit generated from the transaction accounts for more than 10% of the company's audited net profit in the most recent fiscal year, and exceeds 1 million yuan;
The net profit related to the transaction object (such as equity) in the most recent fiscal year accounts for more than 10% of the company's audited net profit in the most recent fiscal year, and exceeds 1 million yuan.
(2) If the company's transactions (except for the provision of guarantees and the company's donation of cash assets) meet one of the following standards, they shall be submitted to the shareholders' meeting for review:
The total assets involved in the transaction (if there are both book value and appraisal value, whichever is higher) account for more than 50% of the listed company’s latest audited total assets;
The transaction amount accounts for more than 50% of the market value of the listed company;
The net assets of the transaction target (such as equity) in the most recent fiscal year account for more than 50% of the market value of the listed company;
The operating income related to the transaction object (such as equity) in the most recent fiscal year accounts for more than 50% of the audited operating income of the listed company in the most recent fiscal year, and exceeds 50 million yuan;
The profit generated from the transaction accounts for more than 50% of the listed company’s audited net profit in the most recent fiscal year, and exceeds 5 million yuan;
The net profit related to the transaction object (such as equity) in the most recent fiscal year accounts for more than 50% of the audited net profit of the listed company in the most recent fiscal year, and exceeds 5 million yuan.
(3) When the company “provides guarantees”, it shall promptly disclose it to the outside world after deliberation by the board of directors. If the "provision of guarantee" matter falls within one of the circumstances specified in Article 47 of the Articles of Association, it shall also be submitted to the shareholders' meeting for review after being reviewed and approved by the company's board of directors.
(4) If the company's related-party transactions (excluding the provision of guarantees) meet one of the following standards, they must be approved by more than half of all independent directors, reviewed and approved by the board of directors, and disclosed in a timely manner:
Transactions between the company and related natural persons with a transaction amount of more than 300,000 yuan;
The transaction amount between the company and related legal persons accounts for more than 0.1% of the company's latest audited total assets or market value, and exceeds 3 million yuan.
(5) If the amount of transactions (excluding guarantees provided) between the company and related parties exceeds 30 million yuan and accounts for more than 1% of the absolute value or market value of the company's most recent audited total assets, an intermediary agency qualified to perform securities and futures-related businesses should be hired to evaluate or audit the transaction target. After being reviewed and approved by the board of directors, it should also be submitted to the shareholders' meeting for review.
Article 114 The chairman of the board of directors shall exercise the following powers:
(1) Preside over shareholders’ meetings and convene and preside over board meetings;
(2) Supervise and inspect the implementation of board resolutions;
(3) Other powers granted by the board of directors.
Article 115 The vice chairman of the company assists the chairman in his work. If the chairman is unable or fails to perform his duties, the vice chairman shall perform his duties (if the company has two or more vice chairmen, the vice chairman jointly elected by more than half of the directors shall perform his duties); if the vice chairman is unable or fails to perform his duties, more than half of the directors shall jointly elect a director to perform his duties.
Article 116 The board of directors shall hold at least two regular meetings every year, convened by the chairman of the board of directors, and all directors shall be notified in writing 10 days before the meeting.
Article 117 Shareholders representing more than 1/10 of the voting rights, more than 1/3 of the directors or the audit committee may propose to convene an extraordinary meeting of the board of directors. The chairman of the board of directors shall convene and preside over a board meeting within 10 days after receiving the proposal.
Article 118 When the board of directors convenes an extraordinary board meeting, all directors shall be notified in writing (including personal delivery, mail, fax, email, etc.) or by telephone 3 days before the meeting, unless the participating directors have no objection and the extraordinary board meeting shall be held by on-site meeting, telephone or fax in special emergencies.
Article 119 The notice of board meeting shall include the following contents:
(1) Meeting date and location;
(2) Meeting period;
(3) Reasons and issues;
(4) Date of issuance of notice.
Article 120 A board meeting can only be held if more than half of the directors are present. Resolutions made by the board of directors must be approved by more than half of all directors.
The voting on resolutions of the board of directors shall be based on one person, one vote.
Article 121 If a director has a relationship with an enterprise or individual involved in the matters resolved at the board of directors meeting, the director shall report to the board of directors in writing in a timely manner. Directors with related relationships may not exercise voting rights on this resolution, nor may they exercise voting rights on behalf of other directors. The board meeting can be held if more than half of the unrelated directors are present, and resolutions made at the board meeting must be passed by more than half of the unrelated directors. If the number of unrelated directors attending the board meeting is less than 3, the matter shall be submitted to the shareholders' meeting for review.
Article 122 The voting method for resolutions of the board of directors is: a show of hands or a written vote.
On the premise of ensuring that directors can fully express their opinions, extraordinary meetings of the board of directors can be held and resolutions can be made by fax, subpoenaing board resolutions, telephone or video conference, and must be signed by the participating directors.
Article 123 Board meetings shall be attended by the director in person. If a director is unable to attend for any reason, he may entrust another director in writing to attend on his behalf. The power of attorney shall state the name of the agent, matters of agency, scope of authorization and validity period, and shall be signed or sealed by the principal.
Directors attending meetings on their behalf shall exercise their rights within the scope of authorization. If a director fails to attend a board meeting or appoint a representative to attend, he shall be deemed to have given up his right to vote at the meeting.
Independent directors may not entrust non-independent directors to attend meetings on their behalf.
Article 124 The board of directors shall make minutes of its decisions on the matters discussed at the meeting, and the directors attending the meeting shall sign on the minutes.
The minutes of board of directors meetings shall be kept as company files and shall be kept for no less than 10 years.
Article 125 The minutes of board meetings shall include the following contents:
(1) The date, place and name of the convener of the meeting;
(2) The names of directors present and the names of directors (agents) entrusted by others to attend the board of directors;
(3) Meeting agenda;
(4) Key points of the director’s speech;
(5) The voting methods and results of each resolution matter (the voting results should indicate the number of votes in favor, against or abstention).
Article 126 Matters stipulated in this Articles of Association that are subject to preliminary study and discussion by the company's party organization shall not be submitted to the board of directors for review without the company's party organization having put forward opinions and suggestions after study and discussion. When the resolutions of the board of directors are inconsistent with the opinions and suggestions of the company's party organization, communication should be fully strengthened to seek consensus. If consensus cannot be reached after full communication, the resolution of the board of directors shall prevail. When the company's party organization deems it necessary, it may report to the higher-level party committee or shareholders' meeting.
Section 3 Independent Directors
Article 127 Independent directors shall conscientiously perform their duties in accordance with laws, administrative regulations, the provisions of the China Securities Regulatory Commission, the stock exchange and these Articles of Association, play a role in decision-making, supervision and balance, and professional consulting in the board of directors, safeguard the overall interests of the company, and protect the legitimate rights and interests of small and medium-sized shareholders.
Article 128 Independent directors must maintain their independence. The following persons are not allowed to serve as independent directors:
(1) Personnel working in the company or its affiliated enterprises and their spouses, parents, children, and major social relations;
(2) Directly or indirectly hold more than 1% of the company’s issued shares or are natural person shareholders and their spouses, parents, and children among the top ten shareholders of the company;
(3) Shareholders who directly or indirectly hold more than 5% of the company’s issued shares or persons who hold positions among the top five shareholders of the company and their spouses, parents, and children;
(4) Personnel working in affiliated enterprises of the company’s controlling shareholder or actual controller and their spouses, parents, and children;
(5) Persons who have major business dealings with the company, its controlling shareholders, actual controllers or their respective subsidiaries, or persons who work in units with major business dealings and their controlling shareholders or actual controllers;
(6) Personnel who provide financial, legal, consulting, sponsorship and other services to the company and its controlling shareholders, actual controllers or their respective affiliated enterprises, including but not limited to all members of the project team of the intermediary agency providing services, reviewers at all levels, persons who signed the report, partners, directors, senior managers and principal persons in charge;
(7) Persons who have had the circumstances listed in items 1 to 6 in the past twelve months;
(8) Other personnel who are not independent as stipulated in laws, administrative regulations, regulations of the China Securities Regulatory Commission, business rules of stock exchanges and these Articles of Association.
The subsidiaries of the company's controlling shareholders and actual controllers in items 4 to 6 of the preceding paragraph do not include enterprises controlled by the same state-owned asset management institution as the company and which are not affiliated with the company in accordance with relevant regulations.
Independent directors should conduct self-examinations on their independence every year and submit the self-examination results to the board of directors. The board of directors should evaluate the independence of serving independent directors every year and issue special opinions, which should be disclosed at the same time as the annual report.
Article 129 To serve as an independent director of a company, one must meet the following conditions:
(1) Qualified to serve as a director of a listed company in accordance with laws, administrative regulations and other relevant provisions;
(2) Meet the independence requirements stipulated in this Articles of Association;
(3) Have basic knowledge of the operation of listed companies and be familiar with relevant laws, regulations and rules;
(4) Have more than five years of legal, accounting or economic work experience necessary to perform the duties of an independent director;
(5) Have good personal moral character and have no bad records such as major breach of trust;
(6) Other conditions stipulated in laws, administrative regulations, regulations of the China Securities Regulatory Commission, business rules of stock exchanges and these Articles of Association.
Article 130 As a member of the board of directors, independent directors have a duty of loyalty and diligence to the company and all shareholders, and prudently perform the following duties:
(1) Participate in the decision-making of the board of directors and express clear opinions on the matters discussed;
(2) Supervise potential major conflicts of interest between the company and its controlling shareholders, actual controllers, directors, and senior managers, and protect the legitimate rights and interests of small and medium-sized shareholders;
(3) Provide professional and objective suggestions on the company’s business development and promote the improvement of the board’s decision-making level;
(4) Other duties stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
Article 131 Independent directors shall exercise the following special powers:
(1) Independently hire intermediaries to audit, consult or verify specific matters of the company;
(2) Propose to the board of directors to convene an extraordinary shareholders’ meeting;
(3) Proposing to convene a board meeting;
(4) Publicly solicit shareholder rights from shareholders in accordance with the law;
(5) Express independent opinions on matters that may damage the rights and interests of the company or small and medium-sized shareholders;
(6) Other powers stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
The exercise of the powers listed in items 1 to 3 of the preceding paragraph by independent directors shall be subject to the consent of more than half of all independent directors.
If an independent director exercises the powers listed in paragraph 1, the company will promptly disclose it. If the above powers cannot be exercised normally, the company will disclose the specific circumstances and reasons.
Article 132 The following matters shall be submitted to the board of directors for review after being approved by more than half of all independent directors of the company:
(1) Related transactions that should be disclosed;
(2) Plans for the company and relevant parties to change or waive their commitments;
(3) The decisions made and measures taken by the board of directors of the acquired listed company regarding the acquisition;
(4) Other matters stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
Article 133 The company shall establish a special meeting mechanism attended by all independent directors. The board of directors' review of related transactions and other matters shall be approved in advance by a special meeting of independent directors.
The company holds special meetings of independent directors regularly or irregularly. Matters listed in items (1) to (3) of paragraph 1 of Article 131 of this Article and Article 132 shall be reviewed by special meetings of independent directors.
Special meetings of independent directors can study and discuss other matters of the company as needed.
Special meetings of independent directors shall be convened and chaired by an independent director jointly elected by more than half of the independent directors; if the convener fails or is unable to perform his duties, two or more independent directors may convene and elect a representative to preside.
Minutes of special meetings of independent directors shall be made in accordance with regulations, and the opinions of independent directors shall be stated in the minutes. Independent directors should sign and confirm the meeting minutes.
The company provides convenience and support for the convening of special meetings of independent directors.
Section 4 Special Committees of the Board of Directors
Article 134 The company's board of directors shall set up an audit committee to exercise the powers of the board of supervisors as stipulated in the Company Law.
Article 135 The Audit Committee shall consist of 3 directors who are not senior managers of the company, including 2 independent directors, and an accounting professional among the independent directors shall serve as the convener.
Article 136 The Audit Committee is responsible for reviewing the company's financial information and its disclosure, supervising and evaluating internal and external audit work and internal control. The following matters shall be submitted to the Board of Directors for review after being approved by more than half of all members of the Audit Committee:
(1) Disclose financial information and internal control evaluation reports in financial accounting reports and periodic reports;
(2) Appoint or dismiss the accounting firm that handles the company’s audit business;
(3) Appoint or dismiss the company’s financial director;
(4) Changes in accounting policies, accounting estimates or correction of major accounting errors due to reasons other than changes in accounting standards;
(5) Other matters stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
Article 137 The Audit Committee shall hold at least one meeting every quarter. Extraordinary meetings may be convened upon the proposal of two or more members, or when the convener deems it necessary. Meetings of the Audit Committee must be attended by more than two-thirds of the members.
Resolutions made by the Audit Committee must be approved by more than half of the members of the Audit Committee.
The voting on resolutions of the Audit Committee shall be one person, one vote.
The audit committee shall produce meeting minutes in accordance with regulations when making resolutions, and the members of the audit committee who attended the meeting shall sign on the meeting minutes.
The working procedures of the Audit Committee are formulated by the Board of Directors.
Article 138 The company's board of directors shall set up other special committees such as strategy, nomination, remuneration and assessment, etc., to perform their duties in accordance with the Articles of Association and the authorization of the board of directors. The proposals of the special committees shall be submitted to the board of directors for review and decision. The working procedures of special committees are formulated by the board of directors.
Article 139 The main responsibilities of the Strategy Committee:
(1) Conduct research and make suggestions on the company’s long-term development strategic plan;
(2) Conduct research and make recommendations on major investment and financing plans that are subject to approval by the board of directors as stipulated in this Article of Association;
(3) Conduct research and make recommendations on major capital operations and asset management projects that are subject to approval by the board of directors as stipulated in this Article of Association;
(4) Conduct research and make suggestions on other major matters affecting the company’s development;
(5) Inspect the implementation of the above matters;
(6) Other matters authorized by the company's board of directors.
Article 140 The Nomination Committee is responsible for formulating the selection criteria and procedures for directors and senior managers, selecting and reviewing candidates for directors and senior managers and their qualifications, and making recommendations to the board of directors on the following matters:
(1) Nominate or appoint or remove directors;
(2) Appoint or dismiss senior managers;
(3) Other matters stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
If the board of directors fails to adopt the recommendations of the nomination committee or does not fully adopt them, it shall record the opinions of the nomination committee and the specific reasons for failure to adopt them in the board resolution and disclose them.
Article 141 The Remuneration and Appraisal Committee is responsible for formulating and conducting assessment standards for directors and senior managers, formulating and reviewing remuneration policies and plans such as the remuneration determination mechanism, decision-making process, payment and stop-payment recourse arrangements for directors and senior managers, and making recommendations to the board of directors on the following matters:
(1) Remuneration of directors and senior managers;
(2) Formulating or changing equity incentive plans and employee stock ownership plans, and achievements in granting benefits to incentive targets and conditions for exercising their rights;
(3) Directors and senior managers arrange shareholding plans for the subsidiaries to be spun off;
(4) Other matters stipulated in laws, administrative regulations, provisions of the China Securities Regulatory Commission and these Articles of Association.
If the board of directors fails to adopt the recommendations of the remuneration and appraisal committee or does not fully adopt them, it shall record the opinions of the remuneration and appraisal committee and the specific reasons for failure to adopt them in the resolution of the board of directors and disclose them.
Chapter 6 Senior Management
Article 142 The company shall have a general manager, who shall be appointed or dismissed by the board of directors.
The company shall have several deputy general managers, who shall be appointed or dismissed by the board of directors.
Article 143 The provisions of this Articles of Association regarding the circumstances in which directors are not allowed to serve as directors and the resignation management system shall also apply to senior managers.
The provisions of this Articles of Association regarding directors' duties of loyalty and diligence also apply to senior managers.
Article 144 Persons who hold other administrative positions other than directors and supervisors in the company's controlling shareholder units shall not serve as senior managers of the company.
The company's senior managers only receive their salaries from the company and are not paid by the controlling shareholder.
Article 145: The term of office of the general manager is three years, and the general manager can be re-elected.
Article 146 The general manager shall be responsible to the board of directors and shall exercise the following powers:
(1) Preside over the company’s production, operation and management work, organize the implementation of board resolutions, and report work to the board of directors;
(2) Organize and implement the company’s annual business plan and investment plan;
(3) Formulate a plan for the establishment of the company’s internal management organization;
(4) Formulate the company’s basic management system;
(5) Formulate specific regulations of the company;
(6) Request the board of directors to appoint or dismiss the company’s deputy general manager and financial director;
(7) Decide on the appointment or dismissal of management personnel other than those who shall be appointed or dismissed by the board of directors;
(8) Other powers granted by this Articles of Association or the Board of Directors.
Before exercising the above-mentioned powers, the general manager shall hold a general manager office meeting, which shall be discussed and approved after collective discussion. The general manager attends board meetings.
Article 147 The general manager shall formulate general manager work rules and submit them to the board of directors for approval before implementation.
Article 148 The general manager’s working rules include the following contents:
(1) The conditions, procedures and participants for the general manager meeting;
(2) The specific responsibilities and division of labor of the general manager and other senior managers;
(3) The use of company funds and assets, the authority to sign major contracts, and the reporting system to the board of directors;
(4) Other matters deemed necessary by the board of directors.
Article 149 The general manager may resign before the expiration of his term of office. The specific procedures and methods for the resignation of the general manager shall be stipulated in the labor contract between the general manager and the company.
Article 150 The deputy general manager and financial controller shall assist the general manager in performing relevant duties. The deputy general manager is nominated by the general manager and appointed or dismissed by the board of directors. The deputy general manager assists the general manager in his work, and his responsibilities are stipulated in the general manager’s work rules.
Article 151 The company shall have a secretary to the board of directors, who shall be responsible for the preparation of the company’s shareholders’ meetings and board of directors meetings, the storage of documents, the management of the company’s shareholder information, and the handling of information disclosure matters.
The secretary of the board of directors shall abide by the relevant provisions of laws, administrative regulations, department rules and these articles of association.
Article 152 If a senior manager performs the company's duties and causes damage to others, the company will be liable for compensation; if a senior manager commits intentional or gross negligence, he shall also be liable for compensation.
If senior managers violate laws, administrative regulations, departmental rules or the provisions of these Articles of Association when performing their duties and cause losses to the company, they shall be liable for compensation.
Article 153 The senior managers of the company shall faithfully perform their duties and safeguard the best interests of the company and all shareholders. If a company's senior managers fail to faithfully perform their duties or violate their fiduciary obligations, thereby causing damage to the interests of the company and public shareholders, they shall bear liability for compensation in accordance with the law. The company's senior managers should report to the party organization on a regular basis or on a special basis on the implementation of key matters supervised by the party organization, and actively accept the supervision of the company's party organization.
Chapter 7 Company Party Branch
Article 154 In accordance with the "Articles of the Communist Party of China", the "Regulations on the Work of Grassroots Organizations of State-owned Enterprises of the Communist Party of China (Trial)" and other provisions, and with the approval of the superior party organization, the company established the "CPC Hunan Nanxin Pharmaceutical Co., Ltd. Branch Committee". At the same time, in accordance with relevant regulations, a disciplinary inspection committee was established and corresponding disciplinary inspection and supervision agencies were established.
Company branch members are elected by the party members’ conference, and each term is 3 years. When the term of office expires, a general election shall be held as scheduled. The term of office of the Party's Discipline Inspection Committee is the same as that of the branch committee.
Article 155: Uphold and improve the leadership system of "two-way entry and cross-appointment". Qualified branch committee members can enter the board of directors and management through legal procedures. Qualified party members among the board of directors and management can enter the company's branch committee in accordance with relevant regulations and procedures. The company's party branch secretary and chairman of the board shall be held by one person.
Article 156 The party branch of the company is responsible for the main responsibility for party building work and the construction of party style and integrity, and the party branch secretary is the first person responsible for performing the main responsibility. Members of the company's party branch perform "one post, two responsibilities".
Article 157 The company's party branch must ensure the supervision of the implementation of the party and the country's lines, principles and policies in the company, and make suggestions or express opinions on the company's major decision-making in accordance with the principle of "keeping the direction, managing the overall situation, and ensuring implementation"; implement the principle of party management of cadres and party management of talents, and strive to build a team of high-quality leading cadres and corporate talents Team, strengthen the supervision of company leaders; strengthen the construction of grassroots party organizations, give full play to the battle fortress role of party branches and the vanguard and model role of party members, and take the lead in the implementation of decisions or resolutions of the shareholders' meeting, the board of directors and the party branch; lead the company's ideological and political work and mass organizations such as trade unions and the Communist Youth League, and support the work of the employee congress.
Article 158 The company's party branch shall play a leading role, set the direction, manage the overall situation, ensure implementation, and discuss and decide on major company matters in accordance with regulations. The main responsibilities are:
(1) Strengthen the political construction of the company’s party, adhere to and implement the fundamental system, basic system, and important system of socialism with Chinese characteristics, educate and guide all party members to always maintain a high degree of consistency with the Party Central Committee with Comrade Xi Jinping as the core in terms of political stance, political direction, political principles, and political path;
(2) In-depth study and implementation of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, study and publicize the Party’s theory, implement the Party’s lines, principles and policies, supervise and ensure the implementation of the Party Central Committee’s major decisions and arrangements and the resolutions of superior Party organizations in the company;
(3) Study and discuss the company’s major operational and management matters, and support the board of directors and managers in exercising their powers in accordance with the law;
(4) Strengthen the leadership and control of the company’s selection and employment of personnel, and do a good job in building the company’s leadership team, cadre team, and talent team;
(5) Fulfill the main responsibility of building the company's party style and clean government, lead and support the internal discipline inspection organization to perform the responsibility of supervision and accountability, strictly enforce political disciplines and political rules, and promote the extension of comprehensive and strict party governance to the grassroots;
(6) Strengthen the construction of grassroots party organizations and party member teams, unite and lead employees to actively participate in the company's reform and development;
(7) Lead the company’s ideological and political work, spiritual civilization construction, and united front work, and lead the company’s labor union, Communist Youth League, women’s organizations and other mass organizations;
(8) Discuss and decide on other important matters within the scope of responsibilities of the party branch.
Article 159: Develop a list of major business management matters in accordance with relevant regulations. The following major business and management matters must be pre-study and discussed by the party branch, and then decided by the board of directors and others in accordance with their powers and prescribed procedures:
(1) Implement the decisions and arrangements of the Party Central Committee and the State Council, and implement major measures to implement the national development strategy and the work requirements of the provincial party committee and provincial government;
(2) Formulation of business policies, development strategies, development plans, business plans and investment plans;
(3) Major investment and financing, asset reorganization, asset disposal, property rights transfer, capital operation, engineering construction, bidding, guarantee matters, annual financial budget and final accounts, profit distribution, loss compensation plan, increase or decrease registered capital plan, large amount of fund mobilization and use within the budget, over-budget fund mobilization and use, large amount of donation and sponsorship, and other large amount of fund operation matters;
(4) Important reform plans, plans for the establishment, merger, division, restructuring, dissolution, bankruptcy or change of company form of enterprises and subsidiaries, plans for the establishment and adjustment of internal management agencies;
(5) Formulation and amendment of the articles of association of the company and its subsidiaries, and formulation of basic management systems;
(6) Wage income distribution, enterprise democratic management, employee diversion and resettlement, and other important matters involving employee rights and interests, as well as safety production, ecological environmental protection, maintenance of stability, risk prevention and control, brand building, social responsibility, etc.;
(7) Decision-making plan authorized by the board of directors;
(8) Other important matters that require preliminary research and discussion by the party branch.
Article 160 The company’s party branch must adhere to and improve democratic centralism, establish, improve and strictly implement the rules of procedure for the company’s party branch meetings to achieve full democracy and effective centralization. When conducting preliminary research on major matters of the company, meeting minutes should be kept, and members attending the meeting should review and sign the minutes.
Article 161: Within 10 days after receiving the major issues proposed for prior study by the board of directors and the general manager's office meeting, the company's party branch must convene a party branch meeting to study and issue opinions. No postponement is allowed without special reasons.
Article 162 The company's party branch shall supervise the company's production and operations, focusing on supervision of key departments and positions such as power concentration, capital intensity, resource enrichment, and asset aggregation, establish and improve the power operation supervision mechanism, and supervise the company's legal operations. Supervision matters include but are not limited to the performance of powers and duties by the company's party branch members and high- and middle-level managers in major decision-making, financial management, product sales, material procurement, project bidding, corporate restructuring, property rights changes, and transactions.
Article 163 The company’s party branch must take effective responsibility for the selection and employment of personnel within the scope of the company’s authority, and play a check-in role in determining standards, standardizing procedures, and being responsible for inspecting and recommending candidates.
Article 164 The company’s party branch shall actively support and cooperate with the audit committee in exercising its supervisory functions in accordance with the law.
Article 165 The company’s party branch must reasonably set up a party affairs work organization. The total number of full-time and part-time party personnel in the company should be 1% of the total number of employees. Funds for party organization activities are included in the annual financial budget at a rate of 1% of the company's annual total salary.
Article 166 Relevant expenses incurred by the company's party branch when performing its duties shall be borne by the company in accordance with relevant regulations.
Article 167 All departments of the company are obliged to assist the work of the company’s party branch.
Chapter 8 Financial Accounting System, Profit Distribution and Auditing
Section 1 Financial Accounting System
Article 168 The company shall formulate its financial accounting system in accordance with laws, administrative regulations and the provisions of relevant state departments.
Article 169 The company shall submit and disclose an annual report to the CSRC offices and stock exchanges within 4 months from the end of each fiscal year, and submit and disclose an interim report to the CSRC offices and stock exchanges within 2 months from the end of the first half of each fiscal year.
The above-mentioned annual reports and interim reports are prepared in accordance with relevant laws, administrative regulations, China Securities Regulatory Commission and stock exchange regulations.
Article 170 The company shall not maintain separate company account books other than the statutory accounting books. The company's funds are not stored in accounts opened in any individual's name.
Article 171 When the company distributes after-tax profits for the year, it shall withdraw 10% of the profits and include them in the company's statutory public reserve fund. If the cumulative amount of the company's statutory reserve fund is more than 50% of the company's registered capital, no further withdrawals can be made.
If the company's statutory reserve fund is insufficient to make up for losses in previous years, it shall first make up for the losses with the current year's profits before withdrawing the statutory reserve fund in accordance with the provisions of the preceding paragraph.
After the company withdraws the statutory public reserve fund from the after-tax profits, it can also withdraw the discretionary public reserve fund from the after-tax profits upon resolution of the shareholders' meeting.
The remaining after-tax profits after the company has made up for its losses and withdrawn the reserve fund shall be distributed according to the proportion of shares held by shareholders, except where the Articles of Association stipulate that distribution is not based on the proportion of shareholdings.
If the shareholders' meeting distributes profits to shareholders in violation of the Company Law, the shareholders shall return the profits distributed in violation of the regulations to the company; if losses are caused to the company, the shareholders and the responsible directors and senior managers shall bear the liability for compensation.
The company's shares held by the company will not participate in the distribution of profits.
Article 172 The company's public reserve shall be used to make up for the company's losses, expand the company's production and operations, or be converted into increasing the company's registered capital.
To make up for the company's losses from the public reserve fund, the discretionary public reserve fund and statutory public reserve fund shall be used first; if it still cannot be made up, the capital public reserve fund may be used in accordance with regulations.
When the statutory reserve fund is converted to increase the registered capital, the remaining reserve fund shall not be less than 25% of the company's registered capital before the conversion.
Article 173: After the company's shareholders make a resolution on the profit distribution plan, or after the company's board of directors formulates a specific plan based on the next year's interim dividend conditions and upper limit reviewed and approved by the annual shareholders' meeting, the distribution of dividends (or shares) must be completed within 2 months.
Article 174 The company’s profit distribution policy is: attaching importance to reasonable investment returns for investors and conducive to the long-term development of the company. The company can distribute dividends in the form of cash or shares.
Article 175 The basic principles of the company’s profit distribution policy are as follows:
(1) The company implements a sustained and stable profit distribution policy. The company's profit distribution should pay attention to reasonable returns to investors and take into account the company's sustainable development.
(2) The company shall formulate a profit distribution plan for the year within the scope of accumulated distributable profits based on the company's profit and cash flow status, production and operation development needs, reasonable returns to investors, shareholders' requirements and wishes for profit distribution, social capital costs, external financing environment, etc.
(3) The company should fully consider and listen to the opinions of shareholders (especially small and medium shareholders) and independent directors through multiple channels based on the company's actual situation.
Article 176. Period intervals for company profit distribution
The company generally pays annual dividends, and the board of directors may also propose mid-term cash dividends based on the company's capital needs.
Article 177 The company’s specific profit distribution policies are as follows:
(1) Forms of profit distribution: The company's dividend distribution mainly includes three forms: cash, stocks and a combination of cash and stocks.
(2) Specific conditions and proportions for the company's cash dividends: If the company achieves profits in the current year, and after withdrawing the statutory reserve fund and surplus reserve fund in accordance with the law, if there is no major investment plan or major cash expenditure, the annual cash dividend amount shall not be less than 10% of the distributable profits realized in that year (excluding undistributed profits at the beginning of the year); the company's cumulative profits distributed in cash in the past three years shall not be less than 30% of the average annual distributable profits realized in the past three years.
(3) If the company’s profits from cash dividends in the current year have exceeded 10% of the distributable profits realized in the year or the profits planned to be distributed in cash in the profit distribution plan exceed 10% of the distributable profits realized in the year, the company may distribute the profits in the form of stocks for the part exceeding 10% of the distributable profits realized in the year.
(4) The company's board of directors shall comprehensively consider factors such as the characteristics of the company's industry, development stage, its own business model, profitability level, and whether there are major capital expenditure arrangements, distinguish the following situations, and propose differentiated cash dividend policies in accordance with the procedures stipulated in this Articles of Association:
If the company is in a mature development stage and has no major capital expenditure arrangements, when distributing profits, the proportion of cash dividends in this profit distribution should be at least 80%;
If the company is in a mature stage of development and has major capital expenditure arrangements, when distributing profits, the proportion of cash dividends in this profit distribution should be at least 40%;
If the company is in the growth stage and has major capital expenditure arrangements, when distributing profits, the proportion of cash dividends in this profit distribution should be at least 20%;
If the company's development stage is difficult to distinguish but there are major capital expenditure arrangements, it can be handled in accordance with the provisions of the preceding paragraph.
When the company determines the profit distribution policy and implementation of the subsidiary through the exercise of shareholder rights, it must ensure that the profit distributed by the subsidiary to all shareholders in cash every year shall not be less than 30% of the distributable profit achieved by the subsidiary that year. The company guarantees that as the controlling shareholder, it submits a profit distribution plan to the subsidiary's shareholders' meeting and obtains approval from the subsidiary's shareholders' meeting, thereby ensuring that the profit distribution ratio of the subsidiary can meet the company's profit distribution needs.
Article 178 The review procedure for the company’s profit distribution plan:
(1) The company's profit distribution plan shall be formulated by the company's board of directors in accordance with the provisions of laws, regulations and normative documents, combined with the company's profitability, capital needs and shareholder return plans, and the rationality of the profit distribution plan shall be fully discussed, and a special resolution shall be formed and submitted to the shareholders' meeting for review;
(2) When the company formulates a specific plan for cash dividends, the board of directors should carefully study and demonstrate the timing, conditions and minimum proportion of the company's cash dividends, adjustment conditions and decision-making process requirements, etc. Independent directors can solicit opinions from small and medium-sized shareholders, propose dividend proposals, and submit them directly to the board of directors for review; independent directors have the right to express independent opinions if they believe that the specific cash dividend plan may damage the rights and interests of the company or small and medium-sized shareholders. If the board of directors fails to adopt the opinions of independent directors or does not fully adopt them, it shall record the opinions of independent directors and the specific reasons for not adopting them in the board resolution and disclose them.
(3) During the decision-making and demonstration process of the profit distribution plan, the company's board of directors can communicate with small and medium-sized shareholders through telephone calls, faxes, letters, emails, the investor relations interactive platform on the company's website, etc., fully listen to their opinions and demands, and respond to their concerns in a timely manner.
Article 179 Adjustment of the company’s profit distribution plan:
(1) The company shall re-examine the "Shareholder Return Plan for the Next Three Years" at least once every three years, fully consider and listen to the opinions of shareholders (especially small and medium shareholders) and independent directors through multiple channels, and make appropriate adjustments to the company's ongoing dividend distribution policy to determine the shareholder return plan for that period.
(2) If the company makes annual profits but does not propose a cash profit distribution plan, the company's board of directors should disclose in its regular reports the reasons for not implementing profit distribution or that the profit distribution plan does not include a cash distribution method, as well as the specific use of retained funds.
(3) If the national laws, regulations and securities regulatory authorities promulgate new regulations on the dividend policy of listed companies or the current profit distribution policy is indeed inconsistent with the company's production and operation conditions, investment plans and long-term development goals, the profit distribution policy may be adjusted. Proposals for adjusting the profit distribution policy should detail the reasons for adjusting the profit distribution policy, and the adjusted profit distribution policy must not violate the relevant regulations of the China Securities Regulatory Commission and the Shanghai Stock Exchange. Relevant proposals to adjust the profit distribution policy are proposed by the company's board of directors.
(4) The resolution of the company's board of directors on the profit distribution policy or its adjustment must be approved by more than half of all directors and more than half of the independent directors.
(5) The resolution of the company’s shareholders’ meeting on the profit distribution policy or its adjustment must be approved by more than half of the voting rights held by the shareholders attending the meeting. If the cash dividend policy determined in the Articles of Association (draft) and the shareholder return plan is adjusted or changed, it must be approved by more than 2/3 of the voting rights held by the shareholders attending the shareholders’ meeting. When a company's shareholders' meeting considers adjustments to profit distribution policies, it should arrange to facilitate small and medium-sized investors' participation in the shareholders' meeting through online voting systems and other methods.
Section 2 Internal Audit
Article 180 The company shall implement an internal audit system and clarify the leadership structure, responsibilities and authorities, staffing, funding guarantee, application of audit results and accountability for internal audit work.
The company's internal audit system is implemented after approval by the board of directors and disclosed to the outside world.
Article 181 The company’s internal audit institution shall supervise and inspect the company’s business activities, risk management, internal control, financial information and other matters.
Article 182 The internal audit institution shall be responsible to the board of directors.
The internal audit institution shall accept the supervision and guidance of the audit committee during the supervision and inspection of the company's business activities, risk management, internal control, and financial information. If the internal audit institution discovers relevant major issues or clues, it shall immediately report directly to the audit committee.
Article 183 The internal audit institution is responsible for the specific organization and implementation of the company's internal control evaluation. The company issues an annual internal control evaluation report based on the evaluation report and relevant information issued by the internal audit institution and reviewed by the audit committee.
Article 184 When the audit committee communicates with external audit units such as accounting firms and national audit institutions, the internal audit institutions shall actively cooperate and provide necessary support and collaboration.
Article 185 The Audit Committee shall participate in the assessment of the person in charge of internal audit.
Section 3 Appointment of Accounting Firm
Article 186 The company shall employ an accounting firm that complies with the provisions of the Securities Law to provide auditing of accounting statements, verification of net assets and other related consulting services. The term of appointment shall be one year and may be renewed.
Article 187 The company's appointment or dismissal of an accounting firm shall be decided by the shareholders' meeting. The board of directors shall not appoint an accounting firm before the shareholders' meeting makes a decision.
Article 188 The company guarantees to provide true and complete accounting vouchers, accounting books, financial accounting reports and other accounting information to the accounting firm hired, and shall not refuse, conceal or make false statements.
Article 189 The audit fees of an accounting firm shall be determined by the shareholders' meeting.
Article 190 When the company dismisses or does not renew the appointment of the accounting firm, it shall notify the accounting firm 30 days in advance. When the company's shareholders meeting votes on the dismissal of the accounting firm, the accounting firm shall be allowed to state its opinions.
If an accounting firm proposes to resign, it shall explain to the shareholders' meeting whether there are any improper circumstances in the company.
Chapter 9 Notices and Announcements
Section 1 Notice
Article 191 The company’s notice shall be issued in the following forms:
(1) Delivered by a dedicated person;
(2) Sent by mail;
(3) Sent by email;
(4) By way of announcement;
(5) Other forms stipulated in this charter.
Article 192 If the notice issued by the company is made in the form of announcement, once the announcement is made, all relevant personnel shall be deemed to have received the notice.
Article 193 The notice of the company's shareholders' meeting shall be made by public announcement.
Article 194 The company shall notify the meeting of the board of directors in one or more of the ways specified in Article 118 of the Articles of Association.
Article 195 If a company notice is sent by person, the recipient shall sign (or stamp) the delivery receipt, and the date of receipt by the person to be signed shall be the date of delivery; if the company notice is sent by mail, the fifth working day from the date of delivery to the post office shall be the date of delivery; if the company notice is sent by email, the date of delivery of the email to the recipient's mailbox shall be the date of delivery; if the company notice is sent by way of announcement, the date of the first announcement shall be the date of delivery.
Article 196 If the meeting notice is not sent to a person who has the right to receive the notice due to accidental omission or such person fails to receive the meeting notice, the meeting and the resolutions passed at the meeting will not be invalid.
Section 2 Announcement
Article 197 The company designates the Shanghai Stock Exchange website (www.sse.com.cn) and information disclosure media that meet the conditions specified by the China Securities Regulatory Commission as media for publishing company announcements and other information that needs to be disclosed.
Chapter 10 Merger, spin-off, capital increase, capital reduction, dissolution and liquidation
Section 1 Merger, spin-off, capital increase and capital reduction
Article 198 A company may be merged by absorption or by new establishment.
When a company absorbs other companies, it is called a merger, and the absorbed company is dissolved. The merger of two or more companies to establish a new company is a new merger, and the merging parties are dissolved.
Article 199 If the price paid for a company's merger does not exceed 10% of the company's net assets, it can be done without a resolution of the shareholders' meeting, unless otherwise provided in these articles of association.
If a company merges in accordance with the provisions of the preceding paragraph without a resolution of the shareholders' meeting, it shall be subject to a resolution of the board of directors.
Article 200 When a company merges, the merging parties shall sign a merger agreement and prepare a balance sheet and property list. The company shall notify creditors within 10 days from the date of making the merger resolution and make an announcement within 30 days. Creditors may require the company to pay off debts or provide corresponding guarantees within 30 days from the date of receipt of the notice, or within 45 days from the date of announcement if no notice is received.
Article 201 When a company merges, the claims and debts of the merging parties shall be inherited by the surviving company or the newly established company after the merger.
Article 202 When a company is divided, its property shall be divided accordingly.
When a company is divided, a balance sheet and property list must be prepared. The company shall notify its creditors within 10 days from the date of making the split-up resolution and make an announcement within 30 days.
Article 203 The debts incurred before the division of the company shall be jointly and severally borne by the company after the division. However, this shall not be the case unless otherwise agreed upon in a written agreement between the company and its creditors regarding debt settlement before the division.
Article 204 The company will prepare a balance sheet and property list when reducing its registered capital.
The company shall notify creditors within 10 days from the date when the shareholders' meeting makes a resolution to reduce the registered capital, and shall make an announcement within 30 days. Creditors have the right to require the company to pay off debts or provide corresponding guarantees within 30 days from the date of receipt of the notice, or within 45 days from the date of announcement if no notice is received. When a company reduces its registered capital, it shall reduce its capital contribution or shares accordingly in proportion to the shares held by shareholders, unless otherwise provided by law or these Articles of Association. Article 205 If the company still has losses after making up for its losses in accordance with the provisions of Paragraph 2 of Article 170 of this Article, it may reduce its registered capital to make up for the losses. If the registered capital is reduced to make up for losses, the company shall not distribute to shareholders, nor may it exempt shareholders from their obligation to pay capital contributions or share payments.
If the registered capital is reduced in accordance with the provisions of the preceding paragraph, the provisions of Paragraph 2 of Article 202 of these Articles shall not apply, but an announcement shall be made within 30 days from the date when the shareholders' meeting makes a resolution to reduce the registered capital.
After the company reduces its registered capital in accordance with the provisions of the preceding two paragraphs, it shall not distribute profits until the cumulative amount of the statutory reserve fund and discretionary reserve fund reaches 50% of the company's registered capital.
Article 206 If the registered capital is reduced in violation of the Company Law and other relevant provisions, the shareholders shall return the funds received, and those who reduce or reduce the capital contribution shall be restored to their original status; if losses are caused to the company, the shareholders and the responsible directors and senior managers shall bear the liability for compensation.
Article 207 When the company issues new shares to increase its registered capital, shareholders shall not enjoy preemptive subscription rights, unless otherwise provided in the Articles of Association or the shareholders' meeting decides that shareholders shall enjoy preemptive subscription rights.
Article 208 If a company is merged or divided and the registered items are changed, the change registration shall be carried out with the company registration authority in accordance with the law; if the company is dissolved, the company shall be deregistered in accordance with the law; if a new company is established, the company establishment registration shall be carried out in accordance with the law.
If a company increases or decreases its registered capital, it must apply for change registration with the company registration authority in accordance with the law.
Section 2 Company Dissolution and Liquidation
Article 209 A company is dissolved for the following reasons:
(1) The business period stipulated in these articles of association expires or other reasons for dissolution stipulated in these articles of association occur;
(2) The shareholders’ meeting resolves to dissolve;
(3) Dissolution is required due to company merger or division;
(4) The business license has been revoked, ordered to close, or revoked in accordance with the law;
(5) The company encounters serious difficulties in its operation and management, and its continued existence will cause heavy losses to the interests of shareholders, which cannot be solved through other means. Shareholders holding more than 10% of the company's voting rights may request the People's Court to dissolve the company.
If a company encounters the reasons for dissolution specified in the preceding paragraph, it shall publicize the reasons for dissolution through the National Enterprise Credit Information Publicity System within 10 days.
Article 210 If a company falls under the circumstances specified in Items (1) and (2) of Article 207 of the Articles of Association and has not yet distributed property to shareholders, it may continue to exist by amending the Articles of Association or passing a resolution of the shareholders' meeting.
Amending the Articles of Association or making a resolution at the shareholders' meeting in accordance with the provisions of the preceding paragraph must be approved by more than 2/3 of the voting rights held by shareholders attending the shareholders' meeting.
Article 211 The company shall
If it is dissolved due to the provisions of Item (5), it shall be liquidated. Directors are the liquidation obligors of the company and shall form a liquidation team to carry out liquidation within 15 days from the date of occurrence of the reasons for dissolution.
The liquidation committee shall be composed of directors, unless otherwise stipulated in the Articles of Association or another person shall be elected by resolution of the shareholders' meeting. If the liquidation obligor fails to perform liquidation obligations in a timely manner and causes losses to the company or creditors, he shall be liable for compensation.
Article 212 The liquidation committee shall exercise the following powers during the liquidation period:
(1) Clean up the company’s properties and prepare a balance sheet and property list respectively;
(2) Notify and announce creditors;
(3) Handle the company’s unfinished business related to liquidation;
(4) Pay the taxes owed and the taxes incurred during the liquidation process;
(5) Clearing claims and debts;
(6) Distribute the company’s remaining property after paying off its debts;
(7) Participate in civil litigation activities on behalf of the company.
Article 213 The liquidation team shall notify creditors within 10 days from the date of establishment and make an announcement within 60 days. Creditors shall declare their claims to the liquidation team within 30 days from the date of receipt of the notice, or within 45 days from the date of announcement if no notice is received.
When a creditor declares a creditor's right, he shall explain the relevant matters of the creditor's right and provide supporting materials. The liquidation team shall register the claims.
During the period of reporting claims, the liquidation team shall not pay off creditors.
Article 214 After clearing the company's assets and preparing a balance sheet and property list, the liquidation team shall formulate a liquidation plan and submit it to the shareholders' meeting or the people's court for confirmation.
The company's property is the remaining property after paying liquidation expenses, employees' wages, social insurance fees and statutory compensation, paying taxes owed, and paying off the company's debts respectively, and the company distributes the remaining property according to the proportion of shares held by shareholders. During the liquidation period, the company continues to exist, but it is not allowed to carry out business activities unrelated to the liquidation.
The company's property will not be distributed to shareholders before it is paid off in accordance with the provisions of the preceding paragraph.
Article 215 If, after cleaning up the company's property and preparing a balance sheet and property list, the liquidation team finds that the company's property is insufficient to pay off its debts, it shall apply to the People's Court for bankruptcy liquidation in accordance with the law.
After the People's Court accepts the bankruptcy application, the liquidation team shall hand over the liquidation affairs to the bankruptcy administrator designated by the People's Court.
Article 216 After the company's liquidation is completed, the liquidation team shall prepare a liquidation report, submit it to the shareholders' meeting or the people's court for confirmation, and submit it to the company registration authority to apply for cancellation of company registration.
Article 217 Members of the liquidation team shall have the duty of loyalty and diligence to perform their liquidation duties. If members of the liquidation team neglect to perform their liquidation duties and cause losses to the company, they shall be liable for compensation; if members of the liquidation team cause losses to creditors intentionally or due to gross negligence, they shall be liable for compensation.
Article 218 If a company is declared bankrupt in accordance with the law, bankruptcy liquidation shall be implemented in accordance with the laws on enterprise bankruptcy.
Chapter 11 Modification of the Articles of Association
Article 219 The company will amend its articles of association under any of the following circumstances:
(1) After the Company Law or relevant laws and administrative regulations are revised, the matters stipulated in the articles of association conflict with the provisions of the revised laws and administrative regulations;
(2) The company's situation changes and is inconsistent with the matters recorded in the articles of association;
(3) The shareholders' meeting decides to amend the articles of association.
Article 220 If the amendments to the articles of association passed by the resolution of the shareholders' meeting should be reviewed and approved by the competent authority, they must be reported to the competent authority for approval; if they involve company registration matters, the change registration must be handled in accordance with the law.
Article 221 The Board of Directors shall amend the Articles of Association in accordance with the resolution of the shareholders' meeting to amend the Articles of Association and the approval opinions of the relevant competent authorities.
Article 222 Amendments to the Articles of Association are information required to be disclosed by laws and regulations and shall be announced in accordance with regulations.
Chapter 12 Supplementary Provisions
Article 223 Interpretation
(1) Controlling shareholders refer to shareholders whose shares account for more than 50% of the company's total capital stock; shareholders whose shares do not exceed 50%, but whose voting rights based on the shares they hold are sufficient to have a significant impact on the resolutions of the shareholders' meeting.
(2) Actual controller refers to a natural person, legal person or other organization that can actually control the company's behavior through investment relationships, agreements or other arrangements.
(3) Related relationships refer to the relationships between the company’s controlling shareholders, actual controllers, directors, and senior managers and the companies they directly or indirectly control, as well as other relationships that may lead to the transfer of the company’s interests. However, state-controlled enterprises are related not only because they are also controlled by the state.
Article 224 The board of directors may formulate detailed rules of association in accordance with the provisions of the articles of association.
The articles of association shall not conflict with the provisions of the articles of association.
Article 225 These Articles of Association are written in Chinese. If there is any discrepancy between the Articles of Association in any other language or different versions and the Articles of Association, the Chinese version of the Articles of Association that has been approved and registered by the Hunan Provincial Administration for Market Regulation shall prevail.
Article 226 The Board of Directors of the Company shall be responsible for the interpretation of these Articles of Association. The attachments to this Articles of Association include the Rules of Procedure for the Shareholders' Meeting and the Rules of Procedure for the Board of Directors.
Article 227 The terms “above” and “within” in this Article include the original number; “over”, “beyond”, “less than” and “more than” do not include the original number.
Article 228 If relevant matters involve the supervision of state-owned assets, the company must complete the approval and filing process with the state-owned controlling shareholder and the superior state-owned assets supervision agency in accordance with relevant regulations.
Article 229 Matters not covered in this Article of Association shall be implemented in accordance with the relevant national laws, regulations, departmental rules and normative documents. If the provisions of this Articles of Association are inconsistent with the provisions of laws, regulations, departmental rules, and normative documents promulgated or revised by the state in the future, the provisions of the latter shall apply, and this Articles of Association shall be revised in a timely manner.
Article 230 This Article of Association shall become effective and enforceable from the date of review and approval by the company's shareholders' meeting, and the same shall apply to amendments.
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Hunan Nanxin Pharmaceutical Co., Ltd.
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