Zhongyin Babi Food Co.Ltd(605338)
Foreign investment management system
Chapter I General Provisions
Article 1 in order to strengthen the management of Zhongyin Babi Food Co.Ltd(605338) (hereinafter referred to as “the company”) foreign investment, standardize the company’s foreign investment behavior, prevent investment risks and improve the efficiency of foreign investment, according to the company law of the people’s Republic of China (hereinafter referred to as “the company law”) and the securities law of the people’s Republic of China This system is formulated in combination with the specific conditions of the company, in accordance with the relevant provisions of the Listing Rules of Shanghai Stock Exchange (hereinafter referred to as the “Listing Rules”), the self regulatory guidelines for listed companies of Shanghai Stock Exchange No. 5 – transactions and related party transactions and the articles of Association of Zhongyin Zhongyin Babi Food Co.Ltd(605338) Co., Ltd. (hereinafter referred to as the “articles of association”).
Article 2 the term “foreign investment” as mentioned in this system refers to the following investment activities conducted by the company at home and abroad for the purpose of making profits or maintaining and increasing value:
（1） Equity investment of newly established enterprises;
（2） Investment in capital increase and share expansion and equity acquisition of newly invested enterprises;
（3） Investment in capital increase and share expansion and equity acquisition of existing investment enterprises;
（4） Operating projects and asset investment of the company;
（5） Stock and fund investment;
（6） Bonds, entrusted loans and other debt investments;
（7） Other investments.
Article 3 the company’s investment activities shall follow the following principles:
（1） Comply with national and provincial industrial policies;
（2） Comply with the company’s strategic planning;
（3） It has good economic benefits, which is conducive to optimizing the company’s industrial structure and cultivating core competitiveness;
（4） Adhere to the scientific outlook on development, adapt the investment scale to the asset structure, and act according to your ability,
Scientific demonstration and decision-making.
Chapter II decision-making authority for foreign investment
Article 4 the investment decision-making authority and decision-making procedures of the general meeting of shareholders, the board of directors and the general manager of the company shall be implemented in accordance with the provisions of the company law, the listing rules, the articles of association and the relevant management systems of the company.
Article 5 after the company’s external investment meets one of the following standards, it shall be submitted to the board of directors in time:
（1） The total assets involved in the transaction (if there are both book value and assessed value, whichever is higher) account for more than 10% of the company’s total assets audited in the latest period;
（2） The net assets involved in the subject matter of the transaction (such as equity) (if there are both book value and evaluation value, whichever is higher) account for more than 10% of the latest audited net assets of the listed company, and the absolute amount exceeds 10 million yuan;
（3） The transaction amount of the transaction (including the debts and expenses undertaken) accounts for more than 10% of the company’s latest audited net assets, and the absolute amount exceeds 10 million yuan;
（4） The profit generated from the transaction accounts for more than 10% of the audited net profit of the company in the latest fiscal year, and the absolute amount exceeds 1 million yuan;
（5） The relevant operating income of the transaction object (such as equity) in the latest fiscal year accounts for more than 10% of the audited operating income of the company in the latest fiscal year, and the absolute amount exceeds 10 million yuan;
（6） The related net profit of the transaction object (such as equity) in the latest fiscal year accounts for more than 10% of the audited net profit of the listed company in the latest fiscal year, and the absolute amount exceeds 1 million yuan.
When the company conducts transactions such as “providing financial assistance” and “entrusted financial management”, it shall take the amount as the calculation standard and calculate it cumulatively according to the transaction type for 12 consecutive months. When the amount reaches the provisions of Article 5 and fails to meet the provisions of Article 6, it shall be submitted to the board of directors for deliberation.
If the data involved in the above indicators is negative, the absolute value shall be taken for calculation.
Article 6 if the foreign investment of the company meets one of the following standards, in addition to timely disclosure, it shall also be submitted to the general meeting of shareholders for deliberation:
（1） The total assets involved in the transaction (if there are both book value and evaluation value, whichever is higher) account for more than 50% of the company’s total assets audited in the latest period;
（2） The net assets involved in the subject matter of the transaction (such as equity) (if there are both book value and evaluation value, whichever is higher) account for more than 50% of the latest audited net assets of the listed company, and the absolute amount exceeds 50 million yuan;
（3） The transaction amount of the transaction (including the debts and expenses undertaken) accounts for more than 50% of the company’s latest audited net assets, and the absolute amount exceeds 50 million yuan;
（4） The profit generated from the transaction accounts for more than 50% of the audited net profit of the company in the latest fiscal year, and the absolute amount exceeds 5 million yuan;
（5） The relevant operating income of the transaction object (such as equity) in the latest fiscal year accounts for more than 50% of the audited operating income of the company in the latest fiscal year, and the absolute amount exceeds 50 million yuan;
（6） The related net profit of the transaction object (such as equity) in the latest fiscal year accounts for more than 50% of the audited net profit of the company in the latest fiscal year, and the absolute amount exceeds 5 million yuan.
When the company conducts transactions such as “providing financial assistance” and “entrusted financial management”, it shall take the amount as the calculation standard and calculate it cumulatively within 12 consecutive months according to the transaction type. When the amount reaches the provisions of Article 6, it shall be submitted to the general meeting of shareholders for deliberation.
When the company purchases or sells assets, regardless of whether the transaction object is related or not, if the total amount of assets involved or the transaction amount exceeds 30% of the company’s latest audited total assets in 12 consecutive months, it shall be audited or evaluated, submitted to the general meeting of shareholders for deliberation, and approved by more than two-thirds of the voting rights held by the shareholders present at the meeting.
If the data involved in the above indicators is negative, the absolute value shall be taken for calculation.
Article 7 except for the foreign investment matters that need to be deliberated and approved by the board of directors and the general meeting of shareholders according to Articles 5 and 6 of the system, other investment matters shall be examined and approved by the general manager.
Chapter III follow up daily management of foreign investment
Article 8 the general manager shall draw up the company’s annual investment plan at the beginning of each year, incorporate it into the budget management, and submit it to the strategy committee of the board of directors, the board of directors and the general meeting of shareholders for deliberation.
Article 9 according to the development needs of the company, the general manager can choose investment projects and draw up investment plans outside the annual investment plan. According to the decision-making authority, it shall be reported to the strategic committee of the board of directors, the board of directors or the general meeting of shareholders for review and approval, and the general manager shall organize the implementation.
Article 10 if the annual investment plan needs to be adjusted, or a single investment project or investment budget needs to be adjusted, the general manager shall organize relevant departments to demonstrate before performing relevant approval procedures.
Article 11 the financial management center of the company is responsible for conducting special research and evaluation on the feasibility of investment projects. Article 12 the general manager’s office of the company is responsible for tracking the implementation of investment projects and evaluating investment projects.
Article 13 the internal audit department of the company is responsible for the audit and supervision of investment projects, and no one shall refuse or evade supervision in any form or excuse.
Article 14 the general manager shall report the progress of major investment projects to the board of directors regularly or irregularly. Article 15 if the investment project fails to invest as planned, fails to realize the expected income of the project, losses of investment, or other problems found in the internal audit, the general manager shall be responsible for finding out the causes, investigating the responsibilities of relevant personnel, and reporting to the board of directors.
Chapter IV Inspection and supervision
Article 16 after the investment project is approved and in the process of implementation, if the directors, senior managers and relevant functional departments find that there are major omissions in the scheme, significant changes in the external environment of project implementation or the impact of force majeure may lead to investment failure, they shall submit to the general manager and the board of directors to modify, change or terminate the investment scheme. The investor of an investment project approved by the general meeting of shareholders
The amendment, change or termination of the proposal shall be deliberated at the general meeting of shareholders.
Article 17 after the completion of the investment project, the company shall organize relevant departments and personnel to conduct inspection and report to the general manager, the board of directors or the general meeting of shareholders according to the actual situation.
Article 18 the directors have the right to inspect the company’s investment behavior. Article 19 the board of supervisors of the company has the right to supervise the investment behavior of the company.
Chapter V major event report and information disclosure
Article 20 the company’s foreign investment shall perform the obligation of information disclosure in strict accordance with the listing rules and other relevant provisions.
Article 21 before the foreign investment is disclosed, all insiders shall have the obligation of confidentiality. Article 22 subsidiaries shall follow the management system of information disclosure affairs of the company, and the company has the right to know all the information of subsidiaries.
Article 23 subsidiaries shall timely report the following major matters to the board of directors of the company:
（1） Acquisition and sale of assets;
（2） Major litigation and arbitration matters;
（3） Conclusion, change and termination of important contracts (lending, entrusted operation, entrusted management, entrusted financial management, gift, contract, lease, etc.);
（4） Large amount bank refund;
（5） Major operating or non operating losses;
（6） Suffer heavy losses;
（7） Major administrative punishment;
（8） Other matters stipulated in the listing rules.
Article 24 the information provided by subsidiaries shall be true, accurate and complete, and shall be submitted to the company at the first time, so that the Secretary of the board of directors can disclose it to the public in time.
Chapter VI supplementary provisions
Article 25 The term “more than” in this system includes its own number, and the term “more than” does not include its own number. Article 26 this system shall come into force and be implemented as of the date of deliberation and approval by the general meeting of shareholders. Article 27 matters not covered in this system shall be implemented in accordance with relevant national laws, regulations and the articles of Association; If the relevant provisions of this system conflict with the relevant laws and regulations promulgated or revised in the future, the current articles of association and the articles of association revised according to the legal procedures, they shall be implemented in accordance with the relevant laws and regulations, the current articles of association or the revised articles of association. Article 28 the system shall be formulated and interpreted by the board of directors of the company.
