Management measures for holding subsidiaries
Chapter I General Provisions
Article 1 in order to strengthen the management of Anhui Huilong Agricultural Means Of Production .Co.Ltd(002556) (hereinafter referred to as “the company”) over the holding subsidiary (hereinafter referred to as “the subsidiary”), ensure that the operation and management of the subsidiary conforms to the overall strategic development direction of the company, improve the overall operation efficiency and anti risk ability of the company, and protect the legitimate rights and interests of investors, according to the company law of the people’s Republic of China (hereinafter referred to as “the company law”) These measures are formulated in combination with the actual situation of the company in accordance with the relevant provisions of the securities law of the people’s Republic of China (hereinafter referred to as the “Securities Law”), the governance standards of listed companies, the stock listing rules of Shenzhen Stock Exchange (hereinafter referred to as the “Stock Listing Rules”) and other laws, regulations and normative documents, as well as the Anhui Huilong Agricultural Means Of Production .Co.Ltd(002556) articles of Association (hereinafter referred to as the “articles of association”).
Article 2 the term “subsidiary” as mentioned in these Measures refers to a company legally established according to the company’s overall strategic plan, industrial structure adjustment or business development needs and with an independent legal entity.
Its establishment forms include:
(I) wholly owned subsidiaries established by the company;
(II) subsidiaries jointly invested and established by the company and other companies or natural persons, or holding more than 50% of the company through equity transfer;
(III) subsidiaries whose shareholding ratio of the company is less than 50% (including 50%), but can decide the composition of more than half of the members of its board of directors, or can actually control through agreements and other arrangements.
Article 3 under the framework of the company’s overall policies and objectives, subsidiaries operate and manage independently, and operate the property of enterprise legal persons legally and effectively. The company exercises the management of major matters of its subsidiaries in accordance with relevant laws and regulations and the standardized operation requirements of listed companies.
Article 4 subsidiaries shall comply with the provisions of these measures. If a subsidiary simultaneously controls other companies, it shall establish management measures for its subsidiaries layer by layer with reference to the requirements of these measures, and accept the supervision of the company.
Chapter II Basic Principles of management
Article 5 the company shall exercise the functions of unified management, coordination, supervision and assessment on the subsidiaries, and have the right to urge the subsidiaries to establish and improve the corresponding management system according to the needs of the overall system norms.
Article 6 the company shall enjoy the following rights to its subsidiaries according to its share of shares:
(I) obtain dividends and other forms of benefit distribution;
(II) attend or appoint a shareholder’s agent to attend the shareholders’ meeting according to law and exercise the corresponding voting rights; (III) transfer, gift or pledge its shares and purchase the shares of other shareholders in accordance with laws, regulations and the articles of association of the subsidiary;
(IV) consult the articles of association of the subsidiary, minutes of the shareholders’ meeting, minutes of the board of directors, minutes of the board of supervisors and other important documents of the subsidiary;
(V) participate in the distribution of the remaining property of the company when the subsidiary is terminated or liquidated;
(VI) other rights stipulated by laws, regulations or the articles of association of the subsidiary.
Article 7 the board of directors and all functional departments of the company have the obligation to supervise, manage and guide the operation, finance, major investment, information disclosure, legal affairs and human resources of subsidiaries in accordance with the relevant management systems of the company.
Article 8 all business and management activities of subsidiaries must comply with national laws, regulations and policies, formulate and constantly revise their business and management objectives and risk management procedures in accordance with the company’s business strategy and risk management policies and in combination with the subsidiary’s own development plans and business plans, so as to ensure the investment income of the company and other shareholders. Chapter III personnel management
Article 9 the company has the right to appoint or recommend directors, supervisors and senior managers to subsidiaries according to the proportion of capital contribution or shareholders’ agreement; The term of office of the directors, supervisors and senior managers of the subsidiary shall be in accordance with the provisions of the articles of association of the subsidiary; The company may make appropriate adjustments to the candidates of directors, supervisors and senior executives appointed or recommended during the term of office as required; The Audit Department of the company shall organize the annual assessment of the personnel dispatched by the company.
Article 10 the selection of directors, supervisors and important senior managers appointed by the company to subsidiaries shall comply with the following provisions:
(I) the directors and supervisors of the subsidiaries are recommended by the shareholders of the subsidiaries and elected and replaced by the shareholders’ meeting of the subsidiaries. Among them, the directors and supervisors recommended by the company shall account for more than half of the members of the board of directors and the board of supervisors of the subsidiary respectively, exercise the functions and powers of the directors and supervisors within the scope authorized by the articles of association of the subsidiary on behalf of the company, and bear corresponding responsibilities.
(II) the company has the right to nominate the candidate for general manager of the subsidiary, which shall be appointed by the board of directors of the subsidiary after being approved by the company, exercise corresponding functions and powers within the scope authorized by the articles of association of the subsidiary and be responsible to the board of directors of the subsidiary.
(III) the financial director of the subsidiary shall be recommended by the company and accept the guidance and supervision of the financial director of the company.
Article 11 a subsidiary shall formulate a personnel management system according to its actual situation and report it to the human resources department for the record.
Chapter IV financial, capital and guarantee management
Article 12 the financial department of a subsidiary shall accept the business guidance and supervision of the financial department of the company, abide by the unified financial management policies of the company, and implement a unified accounting system with the company.
Article 13 subsidiaries shall timely and accurately submit financial statements and relevant accounting materials in accordance with the requirements of the company for the preparation of consolidated accounting statements and the disclosure of financial and accounting information, and in accordance with the provisions of the company’s financial department on the content and time of submission.
Article 14 the subsidiary shall prepare the business plan for the next year within 2 months before the end of each year, prepare the work report of the previous year within 2 months after the end of each year, and cooperate with the company in the financial audit and final financial settlement of the previous year.
Article 15 in case of major changes in relevant policies, market environment or management mechanism of the industry or other unforeseen reasons that may affect the implementation of the business plan, the subsidiary shall timely report the relevant situation to the company.
Article 16 a subsidiary shall strictly control the exchange of funds, assets and other resources with its related parties to avoid any non operational occupation. In case of any abnormality, the company will instruct the board of directors of the subsidiary to take corresponding measures. If losses are caused to the company due to the above reasons, the company has the right to ask the board of directors and the board of supervisors of the subsidiary to investigate the responsibilities of relevant personnel according to law.
Article 17 If a subsidiary needs to implement a loan due to the operation and development of the enterprise and the overall arrangement of funds, it shall demonstrate the feasibility of the loan project in advance, and give full consideration to the bearing capacity of loan interest and solvency. After being reviewed by the board of shareholders or the executive department of the subsidiary company, it shall be submitted to the financial department of the subsidiary company for review.
Article 18 without the approval of the shareholders’ meeting of the subsidiary, the subsidiary shall not provide external guarantee or mutual guarantee. The subsidiary shall make a written declaration to the company 5 working days in advance before the external guarantee matters are submitted to the shareholders’ meeting for deliberation, and notify the Securities Investment Department of the company in writing on the day when the shareholders’ meeting makes a resolution to perform the relevant information disclosure obligations.
Article 19 subsidiaries shall formulate a strict application and approval system for the purchase or disposal of fixed assets.
Chapter V investment management
Article 20 when a subsidiary is involved in mergers and acquisitions, related party transactions, foreign investment, major asset restructuring, debt restructuring, major asset disposal, income distribution, increase or decrease of registered capital, merger, separation, dissolution, liquidation, cancellation and other matters subject to deliberation and approval by the company as required by laws and regulations, the subsidiary shall submit the application materials and internal decision-making documents of the matter to the company, The subsidiary can organize the implementation only after the review and approval of the decision-making body with corresponding authority of the company.
Article 21 subsidiaries shall strictly implement the deliberation procedures of “three meetings”. Submit the meeting materials to the Securities Investment Department of the company five days before the meeting of the shareholders’ meeting, the board of directors and the board of supervisors, and perform the corresponding review procedures according to the relevant approval authority.
Article 22 subsidiaries shall ensure the preservation and appreciation of investment project assets and regularly report the project progress to the company.
Article 23 If the company and its subsidiaries suffer losses due to ultra vires in the operation and investment activities, the main responsible personnel shall be given sanctions of criticism, warning or even dismissal, and may be required to bear the liability for compensation.
Chapter VI Information Disclosure and reporting system
Article 24 subsidiaries shall, in accordance with the provisions of these measures and the articles of association, establish a major event reporting system, clarify the deliberation procedures, timely report major business matters, major financial matters, major contracts and other information that may have a significant impact on the trading price of the company’s shares and derivatives to the Securities Investment Department of the company, and bear the obligation of confidentiality before the information is publicly disclosed.
Article 25 a subsidiary shall, within 2 working days after the conclusion of its shareholders’ meeting, board of directors or board of supervisors, submit important documents such as resolutions of the shareholders’ meeting, resolutions of the board of directors or board of supervisors and relevant meeting materials to the Securities Investment Department of the company for filing.
Article 26 when any transaction occurs, a subsidiary shall carefully consult the list of related parties of the company and carefully judge whether it constitutes a related party transaction. If it constitutes a connected transaction, it shall be reported to the Securities Investment Department of the company in time, and perform the corresponding approval and reporting obligations in accordance with the company’s connected transaction system. If the relevant responsible person fails to perform the relevant approval and reporting obligations in time as required, he will be investigated for corresponding responsibility.
Article 27 insiders shall be responsible for keeping confidential the undisclosed information of the company and its subsidiaries, and shall not disclose the undisclosed information to any unit or individual in any way.
Article 28 the information provided by subsidiaries must be timely, true, accurate and complete. The information provided by the subsidiary must be in written form, signed and sealed by the person in charge of the subsidiary.
Chapter VII performance appraisal
Article 29 subsidiaries must establish an incentive and restraint mechanism that can fully mobilize the enthusiasm and creativity of the management and all employees according to their own conditions and in combination with the company’s assessment, reward and punishment and salary management system.
Article 30 the company shall sign the letter of responsibility for business objectives with the general manager of the subsidiary every year, issue the assessment objectives, and honor the rewards and punishments according to the completion at the end of the year; The letter of responsibility for the annual business objectives of the deputy general managers and other senior managers of the subsidiaries shall be signed by the general managers of the subsidiaries respectively. The signed letter of responsibility for business objectives shall be reported to the Audit Department of the company for filing.
The assessment, reward and punishment schemes for the middle-level and below employees of the subsidiary shall be formulated by the management of the subsidiary and reported to the Audit Department of the company for the record.
Article 31 after the end of each fiscal year, the subsidiary shall assess the senior managers according to the annual business indicators and the business results confirmed by the audit, and implement rewards and punishments according to the assessment results.
Article 32 If the directors, supervisors, senior managers and other personnel appointed by the company to the subsidiary fail to perform their duties and obligations, or fail to implement the relevant decisions of the company, resulting in adverse effects on the business activities and economic interests of the company or the dispatched subsidiary, the company will punish them in accordance with relevant systems and procedures, including warning, removal and investigation of economic responsibility.
Article 33 If the directors, supervisors, senior managers and other personnel appointed by the company to the subsidiaries cause losses to the company due to violation of national laws and regulations in the performance of their official duties, they shall bear corresponding legal liabilities. Article 34 If the company violates the national laws and regulations, the management regulations of the securities regulatory authority and the relevant systems of the company, resulting in the punishment of the company, the board of directors, directors, supervisors and senior managers of the company by the securities regulatory authority or Shenzhen Stock Exchange, the company shall give corresponding punishment to the directors, supervisors, senior managers and other personnel of the subsidiary according to the relevant regulations.
Chapter VIII supplementary provisions
Article 35 matters not covered in these Measures shall be implemented in accordance with relevant laws, regulations, normative documents, articles of association and other relevant provisions.
Article 36 the board of directors of the company shall be responsible for the interpretation of these measures.
Article 37 these Measures shall come into force as of the date of deliberation and approval by the general meeting of shareholders of the company, and the same shall apply when amending Anhui Huilong Agricultural Means Of Production .Co.Ltd(002556)
Board of directors
March 2022
