Rules of procedure of the general meeting of shareholders
Chapter I General Provisions
Article 1 These rules are formulated in accordance with the company law of the people’s Republic of China (hereinafter referred to as the “company law”), the securities law of the people’s Republic of China and other laws, regulations, normative documents and the articles of association in order to standardize the company’s behavior and ensure that the general meeting of shareholders exercises its functions and powers according to law.
Article 2 the board of directors of the company shall earnestly perform its duties and seriously and timely convene and convene the general meeting of shareholders. All directors of the company shall be diligent and responsible to ensure the normal convening of the general meeting of shareholders and exercise their functions and powers according to law.
Article 3 the general meeting of shareholders shall exercise its functions and powers within the scope specified in the company law and the articles of association.
Article 4 the general meeting of shareholders is divided into annual general meeting and extraordinary general meeting. The annual general meeting of shareholders shall be held once a year and shall be held within 6 months after the end of the previous fiscal year. The extraordinary general meeting of shareholders shall be held irregularly. In case of the circumstances that the extraordinary general meeting of shareholders shall be held as stipulated in Article 100 of the company law, the extraordinary general meeting of shareholders shall be held within 2 months. If the company is unable to convene the general meeting of shareholders within the above-mentioned period, it shall report to the local office of the CSRC and the stock exchange where the company’s shares are listed and traded (hereinafter referred to as the “Stock Exchange”), explain the reasons and make an announcement.
Article 5 when convening a general meeting of shareholders, the company shall hire a lawyer to give legal opinions on the following issues and make a public announcement: (I) whether the convening and convening procedures of the meeting comply with the provisions of laws, administrative regulations, these rules and the articles of Association;
(II) whether the qualifications of the participants and the convener are legal and valid;
(III) whether the voting procedures and results of the meeting are legal and valid;
(IV) legal opinions on other relevant issues at the request of the company.
Chapter II general provisions of the general meeting of shareholders
Article 6 the general meeting of shareholders is the authority of the company and exercises the following functions and powers according to law:
(I) determine the company’s business policy and investment plan;
(II) elect and replace directors and supervisors who are not staff representatives, and decide on the remuneration of directors and supervisors;
(III) review and approve the report of the board of directors;
(IV) review and approve the report of the board of supervisors;
(V) review and approve the company’s annual financial budget plan and final account plan;
(VI) review and approve the company’s profit distribution plan and loss recovery plan;
(VII) make resolutions on the increase or decrease of the company’s registered capital;
(VIII) make resolutions on the issuance of corporate bonds;
(IX) make resolutions on the merger, division, dissolution, liquidation or change of company form of the company; (x) amend the articles of Association;
（11） Make resolutions on the employment and dismissal of accounting firms by the company;
（12） Review the purchase and sale of major assets or the guarantee amount exceeding 30% of the company’s latest audited total assets within one year;
（13） Deliberating on external guarantees as stipulated in Article 7;
（14） Review and approve the change of the purpose of the raised funds;
（15） Review the equity incentive plan and employee stock ownership plan;
（16） Review other matters that shall be decided by the general meeting of shareholders in accordance with laws, administrative regulations, departmental rules or the articles of association.
Article 7 the following external guarantees of the company shall be examined and approved by the general meeting of shareholders:
(I) any guarantee provided after the total amount of external guarantee of the company and its holding subsidiaries reaches or exceeds 50% of the latest audited net assets;
(II) any guarantee provided after the total amount of external guarantee of the company reaches or exceeds 30% of the latest audited total assets;
(III) the guarantee provided for the guarantee object whose asset liability ratio exceeds 70%;
(IV) the amount of a single guarantee exceeds 10% of the company’s latest audited net assets;
(V) the accumulative amount of guarantee in the last 12 months exceeds 30% of the company’s total assets audited in the latest period; (VI) guarantees provided to shareholders, actual controllers and their related parties;
(VII) other guarantees stipulated by Shenzhen Stock Exchange or the articles of association.
The controlling shareholders and other related parties of the company shall not force the company to provide guarantee for others.
When the general meeting of shareholders deliberates the guarantee matters in Item (V) of the preceding paragraph, it shall be approved by more than two-thirds of the voting rights held by the shareholders present at the meeting. Any guarantee provided by the company for related parties, regardless of the amount, shall be submitted to the general meeting of shareholders for deliberation after being deliberated and approved by the board of directors.
Article 8 under any of the following circumstances, the company shall convene an extraordinary general meeting of shareholders within two months from the date of occurrence:
(I) the number of directors is less than 2 / 3 of the number specified in the company law or the articles of Association; (II) when the company’s outstanding losses reach 1 / 3 of the total paid in share capital;
(III) at the request of shareholders who individually or jointly hold more than 10% of the shares of the company;
(IV) when the board of directors deems it necessary;
(V) when the board of supervisors proposes to hold a meeting;
(VI) other circumstances stipulated by laws, administrative regulations, departmental rules or the articles of association
The number of shares held in Item (III) above shall be calculated according to the date on which the shareholder puts forward a written request.
Chapter III convening of the general meeting of shareholders
Article 9 the general meeting of shareholders shall be convened by the board of directors. The board of directors shall convene the shareholders’ meeting on time within the time limit specified in Article 4.
Article 10 independent directors have the right to propose to the board of directors to convene an extraordinary general meeting of shareholders. For the proposal of independent directors to convene an extraordinary general meeting of shareholders, the board of directors shall, in accordance with the provisions of laws, administrative regulations and the articles of association, give written feedback on whether to agree or disagree to convene an extraordinary general meeting of shareholders within 10 days after receiving the proposal.
If the board of directors agrees to convene an extraordinary general meeting of shareholders, it shall issue a notice of convening the general meeting of shareholders within 5 days after the resolution of the board of directors is made; If the board of directors does not agree to convene an extraordinary general meeting of shareholders, it shall explain the reasons to all shareholders and make a public announcement.
Article 11 the board of supervisors has the right to propose to the board of directors to convene an extraordinary general meeting of shareholders, which shall be submitted to the board of directors in writing. The board of directors shall, in accordance with the provisions of laws, administrative regulations and the articles of association, give written feedback on whether to agree or disagree to convene the extraordinary general meeting of shareholders within 10 days after receiving the proposal.
If the board of directors agrees to convene an extraordinary general meeting of shareholders, it shall issue a notice of convening the general meeting of shareholders within 5 days after the resolution of the board of directors is made. Any change to the original proposal in the notice shall be approved by the board of supervisors.
If the board of directors disagrees with the convening of the extraordinary general meeting of shareholders, or fails to give written feedback within 10 days after receiving the proposal, it shall be deemed that the board of directors is unable to perform or fails to perform its duty of convening the general meeting of shareholders, and the board of supervisors may convene and preside over it by itself.
Article 12 Where the shareholders hold more than 10% of the shares, they shall have the right to request the board of directors to convene an interim meeting in writing.
The board of directors shall, in accordance with the provisions of laws, administrative regulations and the articles of association, give written feedback on whether to agree or disagree to convene the extraordinary general meeting of shareholders within 10 days after receiving the request.
If the board of directors agrees to convene an extraordinary general meeting of shareholders, it shall issue a notice of convening the general meeting of shareholders within 5 days after the resolution of the board of directors is made. The change of the original request in the notice shall be approved by the relevant shareholders.
If the board of directors does not agree to convene the extraordinary general meeting of shareholders, or fails to give feedback within 10 days after receiving the request, the shareholders individually or jointly holding more than 10% of the company’s shares have the right to propose to the board of supervisors to convene the extraordinary general meeting of shareholders, and shall submit a request to the board of supervisors in writing.
If the board of supervisors agrees to convene an extraordinary general meeting of shareholders, it shall issue a notice of convening the general meeting of shareholders within 5 days after receiving the request. Any change to the original request in the notice shall be approved by the relevant shareholders. If the board of supervisors fails to issue the notice of the general meeting of shareholders within the specified time limit, it shall be deemed that the board of supervisors does not convene and preside over the general meeting of shareholders. Shareholders who individually or jointly hold more than 10% of the shares of the company for more than 90 consecutive days may convene and preside over the general meeting of shareholders by themselves.
Article 13 if the board of supervisors or shareholders decide to convene the general meeting of shareholders on their own, they shall notify the board of directors in writing and file with the stock exchange at the same time.
Before the announcement of the resolution of the general meeting of shareholders, the shareholding ratio of the convening shareholders shall not be less than 10%.
The board of supervisors and convening shareholders shall submit relevant supporting materials to the stock exchange when issuing the notice of the general meeting of shareholders and Issuing the announcement of the resolution of the general meeting of shareholders.
Article 14 the board of directors and the Secretary of the board of directors shall cooperate with the general meeting of shareholders convened by the board of supervisors or shareholders. The board of directors shall provide the register of shareholders on the date of equity registration. If the board of directors fails to provide the register of shareholders, the convener may apply to the securities registration and clearing institution for acquisition by holding the relevant announcement of the notice of convening the general meeting of shareholders. The register of shareholders obtained by the convener shall not be used for any purpose other than convening the general meeting of shareholders.
Article 15 for the general meeting of shareholders convened by the board of supervisors or shareholders, the expenses necessary for the meeting shall be borne by the company.
Chapter IV proposal and notice of shareholders’ meeting
Article 16 the proposal of the general meeting of shareholders shall meet the following conditions:
(I) the content does not conflict with the provisions of laws, regulations and the articles of association, and belongs to the business scope of the company and the responsibilities of the general meeting of shareholders;
(II) there are clear topics and specific resolutions;
(III) submit or serve on the board of directors in writing.
Article 17 when the company holds a general meeting of shareholders, the board of directors, the board of supervisors and shareholders who individually or jointly hold more than 3% of the company’s shares have the right to put forward proposals to the company.
Shareholders who individually or jointly hold more than 3% of the company’s shares may put forward interim proposals and submit them to the convener in writing 10 days before the shareholders’ meeting. The convener shall issue a supplementary notice of the general meeting of shareholders within 2 days after receiving the proposal and announce the contents of the interim proposal.
Article 18 except for the circumstances specified in the preceding article, the convener shall not modify the proposals listed in the notice of the general meeting of shareholders or add new proposals after sending the notice of the general meeting of shareholders.
Article 19 for proposals that are not listed in the notice of the general meeting of shareholders or do not meet the provisions of Article 16, the general meeting of shareholders shall not vote and make resolutions.
The board of directors shall review the above-mentioned proposals in accordance with the following principles:
(I) relevance. The board of directors shall review the shareholder’s proposal. If the matters involved in the shareholder’s proposal are directly related to the company and do not exceed the terms of reference of the general meeting of shareholders stipulated in laws, regulations and the articles of association, they shall be submitted to the general meeting of shareholders for discussion. Those that do not meet the above requirements shall not be submitted to the general meeting of shareholders for discussion. If the board of directors decides not to submit the shareholders’ proposal to the shareholders’ meeting for voting, it shall explain and explain it at the shareholders’ meeting, and record the contents of the proposal and the explanation of the board of directors in the minutes of the shareholders’ meeting.
(II) procedural. The board of directors may make decisions on procedural issues involved in shareholder proposals. If the proposal is split or combined for voting, the consent of the original proposer shall be obtained; If the original proposer disagrees with the change, the chairman of the shareholders’ meeting may submit the procedural issues to the shareholders’ meeting for decision and discuss them in accordance with the procedures decided by the shareholders’ meeting.
Article 21 if the proposal of the general meeting of shareholders involves the following matters, it shall be implemented in accordance with the following provisions:
(I) where a proposal involves investment, property disposal, acquisition and merger, the proposer shall fully explain the details of the matter, including the amount involved, price (or valuation method), book value of assets, impact on the company, approval, etc. If it is necessary to conduct asset evaluation, audit or issue an independent financial adviser report according to relevant regulations, the board of directors shall deliver the asset evaluation, audit or independent financial adviser report to relevant parties at least five working days before the shareholders’ meeting.
(II) matters involving public offering of shares and other matters that need to be submitted to the CSRC for approval shall be put forward as special proposals.
(III) after reviewing and adopting the annual report, the board of directors shall make a resolution on the profit distribution plan as a proposal of the annual general meeting of shareholders.
(IV) when the board of Directors proposes the plan of converting capital reserve into share capital, it shall explain the reasons for the conversion in detail.
(V) the appointment of the accounting firm shall be proposed by the board of directors and approved by the general meeting of shareholders. When the board of Directors proposes to dismiss or not renew the appointment of an accounting firm, it shall notify the accounting firm in advance and explain the reasons to the general meeting of shareholders. The accounting firm has the right to state its opinions to the general meeting of shareholders. If the accounting firm proposes to resign, the board of directors shall explain the reasons at the next shareholders’ meeting. The resigned accounting firm shall be responsible for attending the general meeting of shareholders in writing or sending someone to explain whether the company is improper to the general meeting of shareholders.
Article 22 the convener shall notify all shareholders by public announcement 20 days before the annual general meeting of shareholders is held. The extraordinary general meeting of shareholders shall be notified to all shareholders by public announcement 15 days before the meeting is held.
The notice of the general meeting of shareholders and the supplementary notice shall fully and completely disclose the specific contents of all proposals, as well as all the information required for the shareholders to make a reasonable judgment on the matters to be discussed or explain the matters to be discussed. If the opinions of independent directors are required, the opinions and reasons of independent directors shall be disclosed at the same time when the notice of the general meeting of shareholders or the supplementary notice is issued.
Article 23 Where the general meeting of shareholders intends to discuss the election of directors and supervisors, the notice of the general meeting of shareholders shall fully disclose the details of the candidates for directors and supervisors, including at least the following contents:
(I) education background, work experience, part-time job and other personal information;
(II) whether there is any relationship with the company or its controlling shareholders and actual controllers;
(III) disclose the number of shares held by the company;
(IV) whether they have been punished by the CSRC and other relevant departments and the stock exchange. In addition to adopting the cumulative voting system to elect directors and supervisors, each candidate for directors and supervisors shall be proposed in a single proposal. Article 24 the notice of the shareholders’ meeting shall include the following contents:
(I) the date and place of the meeting and the method and duration of the meeting;
(II) matters and proposals submitted to the meeting for deliberation;
(III) explain in obvious words: all shareholders have the right to attend the general meeting of shareholders and can entrust a proxy in writing to attend the meeting and vote. The proxy of the shareholder does not need to be the representative of the company
