Fujian Yongfu Power Engineering Co.Ltd(300712)
Related party transaction management system
Chapter I General Provisions
Article 1 in order to strengthen the management of Fujian Yongfu Power Engineering Co.Ltd(300712) (hereinafter referred to as “the company” or “the company”), safeguard the legitimate interests of all shareholders of the company and ensure that the related party transactions between the company and related parties comply with the principles of fairness, impartiality and openness, in accordance with the provisions of the normative documents regulating related party transactions of the China Securities Regulatory Commission This system is formulated in accordance with the relevant provisions of the accounting standards for business enterprises – disclosure of related party relationships and transactions and the Fujian Yongfu Power Engineering Co.Ltd(300712) articles of Association (hereinafter referred to as the “articles of association”).
Article 2 related party transactions of the company shall follow the following basic principles:
(i) The principle of good faith;
（2） The principle of not damaging the legitimate rights and interests of the company and non affiliated shareholders;
（3） Avoidance principle of affiliated shareholders and directors;
（4） Related party transactions shall follow the principles of market justice, fairness and openness. In principle, the price or fee collection of related party transactions shall not deviate from the standards of independent third parties in the market. For related party transactions that are difficult to compare market prices or whose pricing is limited, the standards related to costs and profits shall be clarified through contracts.
Chapter II related party transactions, related parties and related relationships
Article 3 related party transactions of the company refer to the transfer of resources or obligations between the company or its holding subsidiary and its related persons, including:
(i) Purchase or sale of assets;
（2） Foreign investment (including entrusted financial management and investment in subsidiaries, except the establishment or capital increase of wholly-owned subsidiaries); (3) providing financial assistance (including entrusted loans);
（4） Providing guarantee (refers to the guarantee provided by the company for others, including the guarantee for holding subsidiaries);
（5） Leased in or leased out assets;
（6） Sign management contracts (including entrusted operation, entrusted operation, etc.);
（7） Donated or donated assets;
（8） Creditor’s rights or debt restructuring;
（9） Transfer of research and development projects;
（10） Sign the license agreement;
（11） Waiver of rights (including waiver of preemptive right, preemptive right to subscribe capital contribution, etc.);
（12） Purchase of raw materials, fuel and power;
（13） Selling products and commodities;
（14） Providing or receiving labor services;
（15） Entrusted or entrusted sales;
（16） Joint investment by related parties;
（17） Other matters that may cause the transfer of resources or obligations through agreement;
Article 4 the affiliated persons of the company include affiliated legal persons and affiliated natural persons.
The legal person under any of the following circumstances shall be the affiliated legal person of the company:
(i) Legal persons or other organizations that directly or indirectly control the company;
（2） Legal persons or other organizations other than the company and its holding subsidiaries directly or indirectly controlled by the legal persons mentioned in the preceding paragraph;
（3） Legal persons or other organizations other than the company and its holding subsidiaries that are directly or indirectly controlled by the company’s affiliated natural persons listed in the system, or where the affiliated natural persons act as directors (except independent directors) and senior managers;
（4） Legal persons holding more than 5% of the shares of the company or persons acting in concert;
（5） Other legal persons or other organizations identified by the CSRC, the stock exchange and the company according to the principle of substance over form that have a special relationship with the company and may or have caused the company to favor its interests.
A natural person under any of the following circumstances is an affiliated natural person of the company:
(i) Natural persons who directly or indirectly hold more than 5% of the shares of the company;
（2） Directors, supervisors and senior managers of the company;
（3） Directors, supervisors and senior managers of legal persons or other organizations that directly or indirectly control the company; (IV) more than (I) （2） The close family members of the persons mentioned in Item (3) include: spouse, parents and parents of the spouse, brothers and sisters and their spouses, children over the age of 18 and their spouses, brothers and sisters of the spouse and parents of children’s spouses;
（5） The CSRC, the stock exchange or other natural persons identified by the company according to the principle of substance over form that have a special relationship with the company and may cause the company to favor its interests.
Article 5 a legal person or natural person under any of the following circumstances shall be deemed to be an affiliate of the company:
(i) Due to signing an agreement or making an arrangement with the company or its affiliates, it has one of the circumstances specified in Article 4 of the system after the agreement or arrangement takes effect or within the next 12 months;
（2） In the past 12 months, it has been under one of the circumstances specified in Article 4 of this system.
Chapter III decision making authority of connected transactions
Article 6 decision making authority of connected transactions:
(i) Transactions between the company and related natural persons (except for providing guarantee and financial assistance) with an amount of more than 300000 yuan must be reviewed by the board of directors and disclosed in a timely manner.
Related party transactions between the company and related legal persons (except for providing guarantee and financial assistance) with an amount of more than 3 million yuan and accounting for more than 0.5% of the absolute value of the company’s latest audited net assets must be reviewed by the board of directors and disclosed in a timely manner.
（2） If the amount of transactions (except providing guarantees) between the company and related parties exceeds 30 million yuan and accounts for more than 5% of the absolute value of the latest audited net assets of the company, it shall be submitted to the general meeting of shareholders for deliberation.
If the subject matter of the transaction is the equity of the company, the company shall disclose the audit report of the subject matter of the transaction in the latest year, and the audit deadline shall not exceed six months from the date of the shareholders’ meeting to consider the transaction; If the subject matter of the transaction is non cash assets other than equity, an evaluation report shall be provided, and the benchmark date of the evaluation shall not exceed one year from the date of the shareholders’ meeting to consider the transaction. The audit report and evaluation report specified in the preceding paragraph shall be issued by a securities service institution that complies with the provisions of the securities law.
Related party transactions related to daily operations may be exempted from audit or evaluation.
（3） In addition to the above circumstances, connected transactions must be approved by the general manager.
（4） Related party transactions that need to be submitted to the general meeting of shareholders for deliberation shall be submitted to the board of directors for discussion after being approved in advance by independent directors. The prior approval opinions of independent directors shall be approved by more than half of all independent directors and disclosed in the announcement of related party transactions. Before making judgment, independent directors may hire an intermediary to issue an independent financial consultant report as the basis for their judgment. The board of directors may also organize experts and professionals to review.
Article 7 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.
When the general meeting of shareholders deliberates the guarantee proposal provided for shareholders, actual controllers and their related parties, such shareholders or shareholders controlled by such actual controllers shall not participate in the voting, which shall be adopted by more than half of the voting rights held by other shareholders attending the general meeting of shareholders.
Article 8 when the related party transactions of the company involve the matters of “providing financial assistance” and “entrusted financial management” specified in Article 3 of the system, the amount shall be taken as the calculation standard, and the cumulative calculation shall be carried out within 12 consecutive months according to the type of transaction. If the cumulative calculation reaches the standard of Article 6 of the system, the provisions of Article 6 shall apply. If the relevant decision-making procedures have been performed in accordance with Article 6, they will not be included in the relevant cumulative calculation scope.
Article 10 the provisions of Article 6 of the system shall apply to the following connected transactions of the company within 12 consecutive months in accordance with the principle of cumulative calculation:
(i) Transactions with the same related party;
（2） Transactions with different connected persons related to the same transaction object.
The above same related persons include other related persons who are controlled by the same subject or have equity control relationship with each other.
If the relevant decision-making procedures have been performed in accordance with Article 6, they will not be included in the relevant cumulative calculation scope.
Article 11 when the company conducts daily connected transactions with connected persons, it shall disclose and perform the review procedures in accordance with the following provisions: (I) the company can reasonably estimate the annual amount of daily connected transactions by category, perform the review procedures and disclose; If the actual implementation exceeds the expected amount, relevant review procedures and disclosure obligations shall be performed again according to the excess amount;
（2） The company’s annual report and semi annual report shall disclose daily connected transactions by classification, summary and disclosure;
（3） If the term of the daily connected transaction agreement signed between the company and its connected persons exceeds three years, it shall re perform the relevant review procedures and disclosure obligations every three years.
Article 12 the following transactions between the company and related persons may be exempted from being submitted to the general meeting of shareholders for deliberation:
(i) The company participates in public bidding and public auction for unspecified objects (excluding limited methods such as bidding invitation); (2) transactions in which the company unilaterally obtains benefits, including receiving cash assets, obtaining debt relief, accepting guarantees and subsidies, etc;
（3） The pricing of related party transactions is stipulated by the state;
（4） Related parties provide funds to the company at an interest rate not higher than the loan interest rate standard for the same period stipulated by the people’s Bank of China; (V) the company provides products and services to directors, supervisors and senior managers under the same trading conditions as non related parties.
Article 13 the following transactions between the company and related parties may be exempted from performing relevant obligations in the form of related party transactions:
(i) One party subscribes in cash for shares, corporate bonds or corporate bonds, convertible corporate bonds or other derivatives publicly issued by the other party;
（2） One party, as a member of the underwriting syndicate, underwrites shares, corporate bonds or corporate bonds, convertible corporate bonds or other derivatives publicly issued by the other party;
（3） One party receives dividends, bonuses or remuneration in accordance with the resolutions of the general meeting of shareholders of the other party;
（4） Other transactions recognized by Shenzhen Stock Exchange.
Chapter IV deliberation procedures for connected transactions
Article 14 affiliated directors include the following directors or directors under any of the following circumstances:
(i) Counterparty;
（2） Working in the counterparty, or in the legal person or other organization that can directly or indirectly control the counterparty, or the legal person or other organization directly or indirectly controlled by the counterparty;
（3） Having direct or indirect control over the counterparty;
（4） Close family members of the counterparty or its direct or indirect controller (see item (4) of paragraph 2 of Article 4 of the system for the specific scope);
（5） Close family members of the directors, supervisors and senior managers of the counterparty or its direct or indirect controllers (for the specific scope, please refer to item (4) of paragraph 2 of Article 4 of the system);
（6） Persons identified by the CSRC, the stock exchange or the company who may affect their independent business judgment for other reasons.
Article 15 statement of affiliated directors
Any existing or planned contract, transaction or When the arrangement is related (except for the employment contract), no matter whether the relevant matters generally require the approval and consent of the board of directors, the director shall disclose the nature and extent of his affiliated relationship to the board of directors within 10 days from the date he knows or should know. If the director notifies the board of directors in writing before the company considers entering into relevant contracts, transactions and arrangements for the first time, stating that due to the reasons listed in the notice If the company has an interest in future contracts, transactions and arrangements, the director shall be deemed to perform the disclosure specified in this article to the extent specified in the notice.
Article 16 the explanation of the proposal of the board of directors on related party transactions shall at least include the following contents:
(i) The content, quantity, unit price, total amount, proportion in similar businesses, pricing policy and its basis of the transaction shall also explain whether the pricing is fair, whether there is any difference with the market price of a third party, whether there is no market price to compare or whether the pricing of major related party transactions is limited, and whether the standards related to costs and profits are specified through the contract.
（2） The impact of the transaction on the company’s financial position and operating results.
（3） Whether the transaction damages the interests of the company and minority shareholders.
Article 17 when the board of directors of the company deliberates on related party transactions, related directors shall avoid voting and shall not exercise voting rights on behalf of other directors. The meeting of the board of directors can be held only if more than half of the non affiliated directors are present, and the resolutions made at the meeting of the board of directors must be adopted by more than half of the non affiliated directors. If the number of non affiliated directors attending the board of directors is less than three, the company shall submit the transaction to the general meeting of shareholders for deliberation.
Article 18 when the general meeting of shareholders deliberates on related party transactions, the following shareholders shall withdraw from voting:
(i) Counterparty;
（2） Having direct or indirect control over the counterparty;
（3） Directly or indirectly controlled by the counterparty;
（4） Directly or indirectly controlled by the same legal person or natural person as the counterparty;
（5） Close family members of the counterparty or its direct or indirect controller (see item (4) of paragraph 2 of Article 4 of the system for the specific scope);
（6） Serving in the counterparty, or in the legal entity that can directly or indirectly control the counterparty or the legal entity directly or indirectly controlled by the counterparty (applicable to the case where the shareholder is a natural person);
（7） The voting rights are restricted or affected due to the existence of outstanding equity transfer agreements or other agreements with the counterparty or its affiliates;
（8） The legal person or natural person identified by the CSRC or the stock exchange that may cause the listed company to favor its interests.
Article 19 when the general meeting of shareholders votes on related transactions, related shareholders shall not participate in the voting, and the number of voting shares they represent shall not be included in the total number of effective votes.
Article 20 if the term of signing the daily connected transaction agreement between the company and the connected person exceeds three years, the company shall re perform the review procedures and disclosure obligations every three years in accordance with the provisions of the system.
Chapter V supplementary provisions
Article 21 related party transactions of subsidiaries controlled or holding more than 50% shares by the company shall be regarded as corporate acts, and the above provisions shall apply to their decision-making and disclosure standards; The above provisions shall apply to the amount of related party transactions of the company’s participating companies multiplied by the share participation ratio or agreed dividend ratio.
Article 22 the decision-making records, resolutions and other documents related to connected transactions shall be kept by the Secretary of the board of directors for a period of not less than 10 years.
Article 23 matters not covered in this system shall be handled in accordance with national laws, regulations
