Suzhou Veichi Electric Co.Ltd(688698)
Working rules for independent directors
April, 2002
catalogue
Chapter I General Provisions 2 Chapter II conditions and procedures for the appointment of independent directors Chapter III functions and responsibilities of independent directors Chapter IV working conditions of independent directors 7 Chapter V Supplementary Provisions eight
In order to ensure the standardized operation of Suzhou Veichi Electric Co.Ltd(688698) (hereinafter referred to as “the company”) and better safeguard the interests of the company’s shareholders, the detailed rules for the work of independent directors are hereby formulated in accordance with the relevant provisions of 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 the Suzhou Veichi Electric Co.Ltd(688698) articles of Association (hereinafter referred to as “the articles of association”).
Chapter I General Provisions
Article 1 an independent director of the company refers to a director who does not hold any position other than a director in the company and has no relationship with the company and its shareholders that may hinder his independent and objective judgment. Independent directors shall not hold any position other than independent directors in the company.
Article 2 the company has three independent directors. At least one third of the members of the board of directors of the company shall be independent directors, who shall be responsible to all shareholders and shall be elected or replaced by the general meeting of shareholders. The independent directors shall include at least one accounting professional (the “accounting professional” in the working rules refers to the person with senior accounting title or certified public accountant qualification).
The board of directors may establish special committees on strategy, audit, nomination, remuneration and assessment in accordance with the relevant resolutions of the general meeting of shareholders. The members of the special committee are all composed of directors, among which the independent directors of the audit committee, nomination committee and remuneration and assessment committee shall account for the majority and act as the convener. At least one independent director of the audit committee shall be an accounting professional.
Article 3 independent directors shall have the obligation of good faith and diligence to the company and all shareholders. Independent directors shall earnestly perform their duties and safeguard the overall interests of the company in accordance with the requirements of relevant laws and regulations, the rules for independent directors of the company and the articles of association, and pay particular attention to the legitimate rights and interests of minority shareholders of the company. Independent directors shall perform their duties independently and shall not be affected by the company’s major shareholders or other units or individuals having an interest in the company. If it is found that the matters under consideration affect their independence, it shall declare to the company and withdraw. In case of any situation that obviously affects the independence during the term of office, the company shall be notified in time and resign if necessary.
Chapter II conditions and procedures of appointment of independent directors
Article 4 an independent director shall have the qualifications suitable for the exercise of his functions and powers.
Article 5 an independent director shall meet the following conditions:
(I) be qualified to serve as a director of a listed company in accordance with laws, regulations and other relevant provisions;
(II) have the independence required by the rules for independent directors of listed companies;
(III) have basic knowledge of the operation of listed companies and be familiar with relevant laws, administrative regulations, rules and rules;
(IV) more than five years of working experience in law, economics or other necessary for performing the duties of independent directors; (V) have a certain amount of time and energy to perform the duties of independent directors;
(VI) other conditions stipulated by laws, regulations and the articles of association.
Independent directors and persons who intend to serve as independent directors shall participate in the training organized by the CSRC and its authorized institutions in accordance with the provisions.
Article 6 independent directors must be independent, and the following persons shall not serve as independent directors:
(I) persons who work in the company or its affiliated enterprises, their immediate family members and their main social relations (immediate family members refer to spouses, parents, children, etc.; main social relations refer to brothers and sisters, parents of spouses, spouses of children, spouses of brothers and sisters, brothers and sisters of spouses, etc.);
(II) directly or indirectly holding more than 1% of the issued shares of the company or natural person shareholders and their immediate family members among the top 10 shareholders of the company;
(III) persons who work in shareholder units that directly or indirectly hold more than 5% of the issued shares of the company or in the top five shareholder units of the company and their immediate family members;
(IV) personnel who have had the situations listed in the preceding three items in the latest full accounting year;
(V) personnel providing financial, legal and consulting services for the company or its subsidiaries; (VI) persons who have served as independent directors in five (including five) companies;
(VII) persons who are not allowed to serve as directors of the company in accordance with laws, administrative regulations, departmental rules and the articles of association.
(VIII) other personnel recognized by China Securities Regulatory Commission (hereinafter referred to as CSRC). Article 7 the nomination, election and replacement of independent directors shall be carried out in accordance with the law and norms
(I) the board of directors, the board of supervisors and the shareholders who individually or jointly hold more than 1% of the issued shares of the company may propose candidates for independent directors, which shall be elected and decided by the general meeting of shareholders.
(II) the nominee of an independent director shall obtain the consent of the nominee before nomination. The nominees shall fully understand the basic information of the nominees such as their occupation, educational background, professional title, detailed work experience and all part-time jobs, and express their opinions on their qualifications and independence as independent directors. The nominees shall make a public statement that there is no relationship between themselves and the company that affects their independent and objective judgment.
(III) before the general meeting of shareholders for the election of independent directors is held, the board of directors of the company shall publish the relevant contents in accordance with item (II) of this article, and submit the relevant materials of all nominees to the stock exchange. If the board of directors of the company has any objection to the relevant information of the nominee, it shall submit the written opinions of the board of directors at the same time.
(IV) the term of office of independent directors is the same as that of other directors of the company. Upon expiration of the term of office, they can be re elected, but the term of re-election shall not exceed six years.
(V) if an independent director is unable to attend the meeting of the board of directors in person for three consecutive times, the board of directors shall request the general meeting of shareholders to replace him. In addition to the above circumstances and the circumstances stipulated in the company law that an independent director is not allowed to serve as a director, the company may remove him from his post through legal procedures before the expiration of his term of office. In case of early dismissal, the company shall disclose the dismissal of the independent director as a special disclosure. If the dismissed independent director believes that the company’s reason for dismissal is improper, he may make a public statement.
(VI) independent directors may resign before the expiration of their term of office. When an independent director resigns, he shall submit a written resignation report to the board of directors to explain any situation related to his resignation or deemed necessary to attract the attention of shareholders and creditors of the company. If the proportion of independent directors in the board of directors of the company is lower than the minimum requirements specified in the detailed rules due to the resignation of independent directors, the resignation report of the independent director shall take effect after the next independent director fills his vacancy.
Article 8 If an independent director cannot continue to hold office for some reason, the board of directors shall convene an extraordinary general meeting of shareholders as soon as possible to elect an independent director to fill the vacancy.
Chapter III powers and duties of independent directors
Article 9 independent directors shall attend the meeting of the board of directors on time, understand the production, operation and operation of the listed company, and take the initiative to investigate and obtain the information and materials needed to make decisions.
Independent directors shall submit an annual report on their work to the general meeting of shareholders of the company to explain their performance of their duties.
Article 10 in order to give full play to the role of independent directors, in addition to the rights conferred on directors by the company law and other relevant laws and regulations, independent directors of the company also enjoy the following functions and powers:
(I) major related party transactions (referring to the related party transactions reached between the company and related parties with a total amount of more than 3 million yuan or more than 5% of the company’s recently audited net asset value) shall be submitted to the board of directors for discussion after being approved in advance by the independent directors. Before making a judgment, an independent director may hire an intermediary to issue an independent financial advisory report as the basis for his judgment. With the consent of all independent directors, independent directors can independently hire external audit institutions and consulting institutions to audit and consult the specific matters of the company, and the relevant expenses shall be borne by the company.
(II) propose to convene the board of directors;
(III) propose to the board of directors to convene an extraordinary general meeting of shareholders;
(IV) propose to the board of directors to employ or dismiss the accounting firm;
(V) publicly solicit voting rights from shareholders before the general meeting of shareholders;
(VI) to engage independent audit and consulting institutions for specific matters of the company.
Independent directors shall obtain the consent of more than half of all independent directors when exercising the functions and powers in items (I) to (V) of the preceding paragraph; The exercise of the functions and powers in Item (VI) of the preceding paragraph shall be subject to the consent of all independent directors.
Items (I) (IV) can be submitted to the board of directors for discussion only after more than half of the independent directors agree.
If the proposals listed in paragraph 1 of this article are not adopted or the above functions and powers cannot be normally exercised, the company will disclose the relevant information.
Where laws, administrative regulations and the CSRC provide otherwise, such provisions shall prevail.
Article 11 independent directors shall express independent opinions on major matters of the company.
(I) in addition to performing the duties and responsibilities described in Article 10, independent directors shall also express independent opinions to the board of directors or the general meeting of shareholders on the following matters:
1. Nomination, appointment and removal of directors;
2. Appoint or dismiss senior managers;
3. Remuneration of directors and senior managers of the company;
4. Existing or new loans or other capital transactions between the company’s shareholders, actual controllers and their affiliated enterprises with a total amount of more than 3 million yuan or more than 5% of the company’s recently audited net assets, and whether the company has taken effective measures to recover the arrears;
5. Matters that independent directors believe may damage the legitimate rights and interests of minority shareholders;
6. Other matters stipulated by laws, administrative regulations, CSRC and the articles of association.
(II) independent directors shall express one of the following opinions on the matters mentioned in the preceding paragraph: agree; Reservations and their reasons; Objections and their reasons; Inability to express opinions and its obstacles. (III) if the matters in paragraph 1 of this article are matters that need to be disclosed, the company shall announce the opinions of the independent directors. If the independent directors have differences of opinion and can not reach an agreement, the board of directors shall disclose the differences of opinion of the independent directors.
Article 12 when independent directors find that the company has the following circumstances, they shall actively perform the obligation of due diligence and, if necessary, employ an intermediary institution for special investigation:
(I) important matters are not submitted to the board of directors for deliberation as required;
(II) failing to perform the obligation of information disclosure in time;
(III) there are false records, misleading statements or major omissions in the public information;
(IV) other situations suspected of violating laws and regulations or damaging the rights and interests of public shareholders.
Article 13 the independent directors of the company shall ensure that they have enough time and energy to effectively perform their duties. In addition to attending the meeting of the board of directors, the independent directors shall ensure to use no less than 10 days each year to conduct on-site investigation on the company’s production and operation status, the construction and implementation of management and internal control systems, and the implementation of resolutions of the board of directors.
Independent directors shall submit the annual report of all independent directors to the annual general meeting of shareholders of the company to explain their performance of duties.
Article 14 under any of the following circumstances, the independent director shall make a public statement:
(I) be dismissed by the company, and I think the reason for dismissal is improper;
(II) the independent director resigns due to the company’s situation that hinders the independent director from exercising his functions and powers according to law;
(III) when the meeting materials of the board of directors are insufficient, the proposal of two or more independent directors in writing to postpone the meeting of the board of directors or postpone the consideration of relevant matters is not adopted;
(IV) the board of directors fails to take effective measures after reporting the company’s suspected violations to the board of directors; (V) other circumstances that seriously hinder independent directors from performing their duties.
Article 15 independent directors shall submit a work report to the annual general meeting of shareholders of the company, which shall include the following contents:
(I) ways, times and voting of attending the board of directors throughout the year, and times of attending the general meeting of shareholders as nonvoting delegates;
(II) the situation of expressing independent opinions;
(III) on site inspection;
(IV) proposed convening of the board of directors, proposed employment or dismissal of accounting firms, independent employment of external audit institutions and consulting institutions, etc;
(V) other work done to protect the legitimate rights and interests of minority shareholders.
Article 16 an independent director shall make a written record of his performance of duties through the independent director’s work record.
Chapter IV guarantee for the performance of independent directors
Article 17 in order to ensure the effective exercise of functions and powers by independent directors, the company shall provide necessary working conditions for independent directors:
(I) the company shall ensure that independent directors enjoy the same right to know as other directors. The company must notify the independent directors in advance according to the legal time and provide complete information at the same time for major matters that must be submitted to the board of directors for decision-making; If the independent director considers that the information is insufficient, he may request supplement; When two or more independent directors consider that the information is incomplete, insufficient or the argument is not clear, so that the independent directors cannot make independent judgment or affect their judgment, they can jointly propose in writing to the board of directors to postpone the convening of the board of directors or postpone the consideration of the matter, which shall be adopted by the board of directors.
The information provided by the company to the independent directors shall be kept by the company and the independent directors for at least five years.
(II) the company shall provide the working conditions necessary for independent directors to perform their duties. The Secretary of the board of directors of the company shall actively provide assistance to the independent directors in performing their duties, such as introducing the situation and providing materials, regularly report the operation of the company, and organize the independent directors to make a factual investigation when necessary. If the independent opinions, proposals and written explanations issued by independent directors should be announced, the listed company shall assist in handling the announcement in a timely manner.
(III) when independent directors exercise their functions and powers, relevant personnel of the company shall actively cooperate, and shall not refuse, hinder or conceal, or interfere with their independent exercise of functions and powers.
(IV) the company shall bear the expenses incurred by the independent directors in employing intermediaries and the reasonable expenses incurred in exercising other functions and powers.
(V) the company shall give appropriate work allowance to independent directors. The standard of allowance shall be formulated by the board of directors, reviewed and approved by the general meeting of shareholders, and disclosed in the annual report of the company.
In addition to the above allowances, independent directors shall not obtain additional undisclosed interests from the company and its major shareholders or interested institutions and personnel.
Chapter V supplementary provisions
Article 18 the right to modify this system belongs to the general meeting of shareholders of the company. Under any of the following circumstances, the system shall be modified:
