Related party transaction management system
Guangzhou, Guangdong
January 2002
Related party transaction management system
Chapter I General Provisions
Article 1 in order to regulate the connected transactions of Ligao Foods Co.Ltd(300973) (hereinafter referred to as “the company”) and ensure that the connected transactions of the company do not damage the legitimate rights and interests of the company and non connected shareholders, in accordance with the company law of the people’s Republic of China, the securities law of the people’s Republic of China and other laws, administrative laws, regulations and normative documents, And the relevant provisions of the Ligao Foods Co.Ltd(300973) articles of Association (hereinafter referred to as the “articles of association”) and in combination with the actual situation of the company, this system is hereby formulated.
Article 2 related party transactions between the company and its subsidiaries within the scope of consolidated statements and its related parties shall be governed by the provisions of this system. The related party transactions between the company and its subsidiaries within the scope of consolidated statements shall not apply to the provisions of this system. Article 3 related party transactions between the company and related parties must follow the following basic principles:
(I) the principles of good faith, equality, voluntariness, fairness, openness and fairness;
(II) shall not harm the interests of the company and shareholders;
(III) it is not allowed to conceal the related relationship or decorrelate the related relationship;
(IV) unless otherwise provided by laws, regulations, rules or normative documents, related shareholders and related directors avoid voting on related party transactions;
(V) the board of directors of the company shall judge whether the related party transaction is beneficial to the company according to objective criteria, and employ professional evaluation institutions or independent financial consultants to express opinions when necessary.
Article 4 the directors, supervisors and senior managers of the company shall pay attention to whether the company has been occupied by related parties and other issues that encroach on the interests of the company, including but not limited to inquiry, consultation, etc.
Article 5 where losses are caused or may be caused to the company due to the occupation or transfer of the company’s funds, assets or other resources by related parties, the board of directors of the company shall timely take protective measures such as litigation and property preservation to avoid or reduce losses, and investigate the responsibilities of relevant personnel.
Chapter II related parties and related transactions
Article 6 affiliated persons of the company include affiliated legal persons and affiliated natural persons.
Article 7 a legal person or other organization under any of the following circumstances shall be an affiliated legal person of the company:
(I) legal persons or other organizations that directly or indirectly control the company;
(II) 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;
(III) legal persons or other organizations other than the company and its holding subsidiaries that are directly or indirectly controlled by the affiliated natural persons of the company listed in Article 8 of the system, or serve as directors (except independent directors) and senior managers;
(IV) legal persons or persons acting in concert holding more than 5% of the shares of the company;
(V) China Securities Regulatory Commission (hereinafter referred to as “CSRC”), Shenzhen Stock Exchange (hereinafter referred to as “Shenzhen Stock Exchange”) or other legal persons or other organizations recognized by 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.
Article 8 a natural person under any of the following circumstances shall be an affiliated natural person of the company:
(I) natural persons who directly or indirectly hold more than 5% of the shares of the company;
(II) directors, supervisors and senior managers of the company;
(III) directors, supervisors and senior managers of the legal person listed in paragraph (I) of Article 7 of the system;
(IV) close family members of the persons mentioned in paragraph (I) (II) (III) of this article include spouses, parents and parents of spouses, brothers and sisters and their spouses, children over the age of 18 and their spouses, brothers and sisters of spouses and parents of children’s spouses (the definition of close family members is the same below);
(V) other natural persons identified by China Securities Regulatory Commission, Shenzhen Stock Exchange or the company as having special relationship with the company according to the principle of substance over form, which may cause the company to favor its interests.
Article 9 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, after the agreement or arrangement takes effect or within the next 12 months, it has one of the circumstances specified in Article 7 or 8 of the system;
(II) one of the circumstances specified in Article 7 or Article 8 of the system has occurred in the past 12 months. Article 10 the company’s directors, supervisors, senior managers, shareholders holding more than 5% of the shares and their persons acting in concert and actual controllers shall timely inform the company of the related persons with whom they are related.
Article 11 the company shall timely update the list of connected persons to ensure that the list of connected persons is true, accurate and complete.
When the company and its subordinate holding subsidiaries have trading activities, the relevant responsible persons shall carefully consult the list of connected persons and prudently judge whether it constitutes connected transactions. If it constitutes a connected transaction, it shall perform the obligations of examination and approval and reporting within its respective authority.
Article 12 the related party transactions mentioned in this system refer to the transfer of resources or obligations between the company or its holding subsidiaries and the company’s related parties, including but not limited to the following matters:
(I) purchase or sale of assets (excluding the purchase of raw materials, fuel and power, and the sale of products, commodities and other assets related to daily operation, but it still includes the purchase and sale of such assets in asset replacement); (II) foreign investment (including entrusted financial management and investment in subsidiaries, except for the establishment or capital increase of wholly-owned subsidiaries);
(III) providing financial assistance (including entrusted loans);
(IV) providing guarantee (refers to the guarantee provided by the company for others, including the guarantee for holding subsidiaries);
(V) assets leased in or leased out;
(VI) sign management contracts (including entrusted operation, entrusted operation, etc.);
(VII) donated or donated assets;
(VIII) reorganization of creditor’s rights or debts;
(IX) transfer of research and development projects;
(x) sign the license agreement;
（11） Purchase of raw materials, fuel and power;
（12） Selling products and commodities;
（13） Providing or receiving labor services;
（14） Entrusted or entrusted sales;
（15） Joint investment by related parties;
（16） Other matters that may cause the transfer of resources or obligations through agreement.
（17） Other transactions recognized by Shenzhen Stock Exchange.
Article 13 the company may be exempted from performing relevant obligations in accordance with the system when it enters into the following related party transactions with related parties:
(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;
(II) 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;
(III) one party receives dividends, bonuses or remuneration in accordance with the resolutions of the general meeting of shareholders of the other party;
(IV) other circumstances recognized by Shenzhen Stock Exchange.
Chapter III decision making authority of connected transactions
Article 14 the following connected transactions shall be submitted by the board of directors to the general meeting of shareholders for deliberation after being deliberated and approved by the board of directors: (I) providing guarantee to the connected persons of the company;
(II) related party transactions between the company and related parties with a transaction amount of more than 30 million yuan (except the transactions in which the company unilaterally obtains benefits and provides guarantees) and accounting for more than 5% of the absolute value of the company’s latest audited net assets; (III) other circumstances specified in this system.
Article 15 the following connected transactions shall be considered by the board of directors:
(I) related party transactions between the company and related legal persons with a transaction amount of more than 3 million yuan and accounting for more than 0.5% of the company’s latest audited net asset value;
(II) related party transactions with an amount of more than 300000 yuan between the company and related natural persons;
(III) the amount of transactions between the company and related legal persons is less than 3 million yuan, or less than 0.5% of the latest audited net asset value of the company, and there is a related relationship with the chairman of the board;
(IV) related party transactions between the company and related natural persons with an amount of less than 300000 yuan and related relationship with the chairman of the board of directors.
Article 16 the following connected transactions shall be reviewed by the chairman:
(I) the amount of transactions between the company and related legal persons is less than 3 million yuan, or less than 0.5% of the latest audited net asset value of the company, and there is no related relationship with the chairman of the board;
(II) related party transactions between the company and related natural persons with an amount of less than 300000 yuan and no related relationship with the chairman of the board of directors.
Article 17 the following connected transactions of the company within 12 consecutive months shall be calculated cumulatively, and the internal approval procedures shall be performed according to the cumulatively calculated amount:
(I) when the related party transactions of the company involve “providing financial assistance”, “entrusted financial management” and other matters, the amount shall be taken as the calculation standard and shall be calculated cumulatively within 12 consecutive months according to the type of transaction;
(II) transactions between the company and the same related person within 12 consecutive months;
(III) transactions related to the same transaction object conducted by the company with different related parties within 12 months.
The above-mentioned same related persons include other related persons who are controlled by the same subject or have equity control relationship with the related person.
Those who have fulfilled relevant obligations in accordance with Article 14, 15 or 16 shall not be included in the scope of relevant cumulative calculation.
Chapter IV deliberation procedures for connected transactions
Article 18 when considering related party transactions, the company shall:
(I) understand the real situation of the transaction object in detail, including the operation status, profitability, whether there are rights defects such as mortgage and freezing, and legal disputes such as litigation and arbitration;
(II) learn more about the integrity record, credit status and performance ability of the counterparty, and carefully select the counterparty;
(III) determine the transaction price according to sufficient pricing basis;
(IV) when the Company deems it necessary, it shall employ an intermediary institution to audit or evaluate the subject matter of the transaction.
Article 19 the company shall not review and make decisions on related party transactions under any of the following circumstances: (I) the status of the subject matter of the transaction is unclear;
(II) the transaction price is not determined;
(III) the situation of the counterparty is uncertain;
(IV) other circumstances that cause or may cause the company to be occupied by related parties due to this transaction.
If this transaction may cause the company’s controlled shareholders, actual controllers and their subsidiaries to occupy funds or provide guarantees for them, the company shall formulate solutions.
Article 20 when considering related party transactions, the directors shall make a clear judgment on the necessity, fairness, true intention and impact on the company of related party transactions, pay special attention to the pricing policy and basis of the transaction, including the fairness of the assessed value, the relationship between the transaction price of the transaction object and the book value or assessed value, and strictly abide by the avoidance system of related directors, Prevent the use of related party transactions to regulate profits, transfer interests to related parties and damage the legitimate rights and interests of the company and minority shareholders.
Article 21 when the board of directors 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 when more than half of the unrelated directors are present, and the resolutions made at the meeting of the board of directors must be adopted by more than half of the unrelated directors. If the number of unrelated directors attending the board of directors is less than three, the company shall submit the matter to the general meeting of shareholders for deliberation.
The chairman of the meeting shall remind the related directors to avoid voting before voting at the meeting. If a related director fails to take the initiative to declare and withdraw, the director who knows the situation shall require the related director to withdraw.
Article 22 The Affiliated directors referred to in the preceding article include the following directors or directors under any of the following circumstances: (I) the counterparty;
(II) work 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;
(III) having direct or indirect control over the counterparty;
(IV) close family members of the counterparty or its direct or indirect controller;
(V) close family members of the directors, supervisors and senior managers of the counterparty or its direct or indirect controllers;
(VI) persons identified by the CSRC, Shenzhen Stock Exchange or the company who may affect their independent business judgment for other reasons.
Article 23 the procedures for the shareholders’ meeting to consider related party transactions are as follows:
(I) shareholders who are related to the matters discussed at the general meeting of shareholders shall disclose their relationship to the board of directors of the company before the date of the general meeting of shareholders and actively apply for withdrawal;
(II) when the general meeting of shareholders considers related party transactions, the chairman of the meeting shall remind related shareholders to avoid voting. When the chairman of the meeting announces the withdrawal of related shareholders, he shall explain and explain the relationship between related shareholders and related transaction matters;
(III) the chairman of the general meeting announces that the affiliated shareholders withdraw, and the unrelated shareholders shall review and vote on the affiliated transactions;
(IV) resolutions on related matters must be adopted by more than half of the voting rights held by non related shareholders attending the meeting; If the transaction is a special resolution specified in the articles of association, it shall be adopted by more than 2 / 3 of the voting rights held by unrelated shareholders attending the meeting.
If the affiliated shareholders do not actively apply for withdrawal, other shareholders or shareholder representatives, supervisors and independent directors attending the general meeting of shareholders have the right to request the affiliated shareholders to withdraw; If the shareholder requested to withdraw believes that he does not belong to the scope of withdrawal, the chairman of the general meeting of shareholders shall organize the on-site directors and supervisors to discuss and make a decision on whether to withdraw in accordance with relevant laws and regulations.
The related shareholders who should be avoided may participate in the review of related party transactions with which they are related, and may explain and explain to the general meeting of shareholders whether the related party transactions are fair, legal and the causes, but the shareholder has no right to vote on the matter.
Article 24 The Affiliated shareholders mentioned in the preceding Article refer to the shareholders under any of the following circumstances:
(I) counterparty;
(II) having direct or indirect control over the counterparty;
(III) directly or indirectly controlled by the other party;
(IV) directly or indirectly controlled by the same legal person or natural person as the counterparty;
(V) close family members of the counterparty or its direct or indirect controller;
(VI) work in the counterparty, or in the legal entity that can directly or indirectly control the counterparty, or the counterparty directly or indirectly
