Rules of procedure of the board of directors
April 2022
Chapter I General Provisions
Article 1 in order to standardize the procedures of the board of directors of Hitevision Co.Ltd(002955) (hereinafter referred to as the “company”), ensure that the board of directors implements the resolutions of the general meeting of shareholders and improve the work efficiency and scientific decision-making level of the board of directors, in accordance with the company law of the people’s Republic of China (hereinafter referred to as the “company law”) and the stock listing rules of Shenzhen Stock Exchange (hereinafter referred to as the “Listing Rules”) These rules of procedure are formulated in combination with the actual situation of the company in accordance with the guidelines for self regulatory supervision of listed companies of Shenzhen Stock Exchange No. 1 – standardized operation of listed companies on the main board (hereinafter referred to as “standardized operation”) and Hitevision Co.Ltd(002955) articles of Association (hereinafter referred to as “articles of association”).
Article 2 the board of directors shall set up an office of the board of directors to handle the daily affairs of the board of directors and keep the seals of the board of directors and the office of the board of directors.
Chapter II directors
Article 3 a director of the company is a natural person and cannot serve as a director of the company under any of the following circumstances: (I) no civil capacity or limited civil capacity;
(II) being sentenced to criminal punishment for corruption, bribery, misappropriation of property, misappropriation of property or undermining the order of the socialist market economy, and the expiration of the execution period is less than 5 years, or being deprived of political rights for a crime, and the expiration of the execution period is less than 5 years; (III) being a director, factory director or manager of a company or enterprise in bankruptcy liquidation and personally responsible for the bankruptcy of the company or enterprise, less than 3 years have elapsed since the completion of the bankruptcy liquidation of the company or enterprise;
(IV) having served as the legal representative of a company or enterprise whose business license has been revoked or ordered to close down due to violation of law, and having personal responsibility, less than 3 years have elapsed since the date of revocation of the business license of the company or enterprise;
(V) a large amount of personal debt is not paid off when due;
(VI) being prohibited from entering the securities market by the CSRC, and the time limit has not expired;
(VII) it is publicly recognized by the stock exchange as unfit to serve as a director of a listed company, and the term has not expired; (VIII) other contents stipulated by laws, administrative regulations or departmental rules.
If a director is elected or appointed in violation of the provisions of this article, the election, appointment or employment shall be invalid. If any of the circumstances in items (I) to (VI) of this article occurs to a director during his term of office, or an independent director does not meet the conditions for independence, the relevant director shall immediately stop performing his duties and the company shall remove him from his post in accordance with the corresponding provisions. If any of the circumstances in Item (VII) and (VIII) of this article occurs to a director during his term of office, the company shall remove him from his post within one month from the date of the occurrence of the fact. Relevant directors shall be dismissed but still not removed. If they attend the meeting of the board of directors and vote, their vote shall be invalid.
Article 4 directors shall be elected or replaced by the general meeting of shareholders for a term of three years, and may be removed by the general meeting of shareholders before the expiration of their term of office. A director may be re elected upon expiration of his term of office.
The term of office of the directors shall be calculated from the date of taking office to the expiration of the term of office of the current board of directors. If a director is not re elected in time after the expiration of his term of office, the original director shall still perform his duties in accordance with laws, administrative regulations, departmental rules and the articles of association before the re elected director takes office.
Directors may be concurrently held by the general manager or other senior managers, but the total number of directors concurrently holding the posts of general manager or other senior managers and directors held by employee representatives shall not exceed one-half of the total number of directors of the company.
Article 5 the directors shall abide by the provisions of laws, administrative regulations and the articles of association and bear the following obligations of loyalty to the company:
(I) shall not take advantage of his power to accept bribes or other illegal income, and shall not encroach on the company’s property; (II) not misappropriate the company’s funds;
(III) the company’s assets or funds shall not be stored in an account in its own name or in the name of other individuals, so as to protect the safety and integrity of the company’s assets, and the interests of the company shall not be harmed for the interests of the actual controller, shareholders, employees, himself or any other third party by taking advantage of his position;
(IV) it shall not violate the provisions of the articles of association, lend the company’s funds to others or provide guarantee for others with the company’s property without the consent of the general meeting of shareholders or the board of directors;
(V) not to enter into contracts or conduct transactions with the company in violation of the provisions of the articles of association or without the consent of the general meeting of shareholders;
(VI) without the consent of the general meeting of shareholders, it is not allowed to take advantage of his position to seek business opportunities that should belong to the company for himself or others, and operate businesses similar to the company for himself or for others;
(VII) not accept commissions related to the company’s transactions and keep them for themselves;
(VIII) keep business secrets, not disclose major information that has not been disclosed by the company, not use insider information to obtain improper benefits, and perform the non competition obligation agreed with the company after leaving the company;
(IX) not to use its affiliated relationship to damage the interests of the company;
(x) other loyalty obligations stipulated by laws, administrative regulations, departmental rules and the articles of association.
The income obtained in violation of this article shall belong to the company; If losses are caused to the company, it shall be liable for compensation.
Article 6 the directors shall abide by the provisions of laws, administrative regulations and the articles of association and bear the following obligations of diligence to the company:
(I) exercise the rights conferred by the company carefully, seriously and diligently to ensure that the company’s business activities comply with the requirements of national laws, administrative regulations and various national economic policies, and that the business activities do not exceed the business scope specified in the business license;
(II) all shareholders should be treated fairly;
(III) ensure that there is enough time and energy to participate in the affairs of the listed company. In principle, it shall attend the board of directors in person. If it is unable to attend the board of directors in person for some reason, it shall carefully select the trustee, and the authorized matters and decision-making intention shall be specific and clear, and it shall not be entrusted with full powers;
(IV) prudently judge the risks and benefits that may arise from the matters considered by the board of directors of the company, and express clear opinions on the matters discussed; If the company votes against or abstains from voting at the board of directors, it shall clearly disclose the reasons, basis, improvement suggestions or measures of voting intention;
(V) carefully read the company’s financial and accounting reports, and pay attention to whether there are major preparation errors or omissions in the financial and accounting reports, whether the main accounting data and financial indicators fluctuate significantly and whether the explanation of the reasons for the fluctuation is reasonable; If there is any doubt about the financial and accounting report, it shall take the initiative to investigate or request the board of directors to provide the necessary materials or information;
(VI) pay attention to whether the company’s interests are occupied by related persons or potential related persons, and report to the board of directors in time and take corresponding measures in case of abnormalities;
(VII) carefully read the operation and financial reports of the listed company and the rumors about the company, timely understand and continuously pay attention to the business operation and management status of the company and the major events that have occurred or may occur and their impact, timely report the problems existing in the company’s business activities to the board of directors, and shall not shirk responsibility on the grounds of not directly engaging in operation and management or not knowing or familiar with the company;
(VIII) written confirmation opinions shall be signed on the company’s periodic reports.
Ensure that the information disclosed by the company is true, accurate and complete;
(IX) actively promote the standardized operation of the company, urge the company to perform the obligation of information disclosure in accordance with the law, timely correct and report the company’s violations, and support the company to fulfill its social responsibilities;
(x) it shall truthfully provide relevant information and materials to the board of supervisors, and shall not hinder the board of supervisors or supervisors
（11） Other duties of diligence stipulated by laws, administrative regulations, departmental rules and the articles of association. Article 7 If a director fails to attend the meeting in person or entrust other directors to attend the meeting of the board of directors for two consecutive times, he shall be deemed unable to perform his duties, and the board of directors shall recommend the general meeting of shareholders to replace him.
Article 8 a director may resign before the expiration of his term of office. When a director resigns, he shall submit a written resignation report to the board of directors. The board of directors shall disclose relevant information within 2 days.
If the board of directors of the company is lower than the minimum quorum due to the resignation of directors, the original directors shall still perform their duties in accordance with laws, administrative regulations, departmental rules and the articles of association before the re elected directors take office.
Except for the circumstances listed in the preceding paragraph, the resignation of a director shall take effect when the resignation report is delivered to the board of directors.
Article 9 when a director’s resignation takes effect or his term of office expires, he shall complete all handover procedures with the board of directors. His loyalty obligations to the company and shareholders shall remain valid before and within 3 years after the resignation report takes effect, or within 3 years after the expiration of his term of office, and shall not be automatically terminated after the end of his term of office; His obligation to keep the company confidential remains valid after the end of his term of office until the secret becomes public information; The duration of other obligations shall be determined in accordance with the principle of fairness, depending on the length of time between the occurrence of the event and departure, as well as the circumstances and conditions under which the relationship with the company ends.
If a director leaves office without authorization, he shall be liable for the losses caused by the termination of his office. If a director who is responsible for the company cannot resign because he has not been relieved of some responsibility, or a director who is also an executive of the company fails to pass the audit according to the requirements of the company and leaves without authorization, resulting in losses to the company, he shall be liable for compensation.
Article 10 without the provisions of the articles of association or the legal authorization of the board of directors, no director shall act on behalf of the company or the board of directors in his own name. When a director acts in his own name, if the third party reasonably believes that the director is acting on behalf of the company or the board of directors, the director shall declare his position and identity in advance.
Article 11 Where a director violates the provisions of laws, administrative regulations, departmental rules or the articles of association when performing his duties and causes losses to the company, he shall be liable for compensation.
Chapter III functions and powers of the board of directors
Article 12 the board of directors of the company is composed of nine directors, including three independent directors. The board of directors has one chairman and one to two vice chairmen.
The qualification, nomination, resignation and other matters of independent directors shall be implemented in accordance with the relevant provisions of laws, administrative regulations and departmental rules. For independent directors who do not have the qualification or ability of independent directors, fail to perform their duties independently, or fail to safeguard the legitimate rights and interests of the company and minority shareholders, shareholders who individually or jointly hold more than 1% of the shares of the company may raise doubts or remove their independent directors to the board of directors of the company. The challenged independent director shall explain the questioned matters in time and disclose them. The board of directors of the company shall timely convene a special meeting for discussion after receiving relevant queries or removal proposals, and disclose the results of the discussion.
Article 13 the board of directors shall be responsible to the general meeting of shareholders and exercise the following functions and powers:
(I) convene the general meeting of shareholders and report to the general meeting of shareholders;
(II) implement the resolutions of the general meeting of shareholders;
(III) decide on the company’s business plan and investment plan;
(IV) formulate the company’s annual financial budget plan and final settlement plan;
(V) formulate the company’s profit distribution plan and loss recovery plan;
(VI) formulate the company’s plans for increasing or reducing its registered capital, issuing bonds or other securities and listing; (VII) draw up plans for the company’s major acquisition, acquisition of the company’s shares, merger, division, dissolution and change of company form;
(VIII) within the scope authorized by the general meeting of shareholders, decide on the company’s foreign investment, acquisition and sale of assets, asset mortgage, external guarantee, entrusted financial management, related party transactions, external donation and other matters;
(IX) decide on the establishment of the company’s internal management organization;
(x) decide on the appointment or dismissal of the general manager, the Secretary of the board of directors and other senior managers of the company, and decide on their remuneration, rewards and punishments; According to the nomination of the general manager, appoint or dismiss the deputy general manager, financial director and other senior managers of the company, and decide on their remuneration, rewards and punishments;
（11） Formulate the basic management system of the company;
（12） Formulate the amendment plan of the articles of Association;
（13） Manage the information disclosure of the company;
（14） Propose to the general meeting of shareholders to hire or replace the accounting firm audited by the company;
（15） Listen to the work report of the general manager of the company and check the work of the general manager;
（16） Other functions and powers granted by laws, administrative regulations, departmental rules or the articles of association.
The board of directors, the board of directors and the remuneration assessment committee shall be established according to the needs of the company. The special committee shall be responsible to the board of directors and perform its duties in accordance with the articles of association and the authorization of the board of directors. The proposal shall be submitted to the board of directors for deliberation and decision. The members of the special committee are all composed of directors, in which independent directors account for the majority of the audit committee, nomination committee and remuneration and assessment committee, and act as the convener. The convener of the audit committee is an accounting professional. The board of directors is responsible for formulating the working procedures of the special committee and standardizing the operation of the special committee.
Matters beyond the scope authorized by the general meeting of shareholders shall be submitted to the general meeting of shareholders for deliberation.
Article 14 the board of directors shall determine the external purchase or sale of assets, external investment (including entrusted financial management, investment in subsidiaries, etc.), asset mortgage, external guarantee (including guarantee to holding subsidiaries, etc.), provision of financial assistance (including entrusted loans, etc.), lease in or lease out assets, entrust or entrust to manage assets and businesses, gift or receive assets, reorganization of creditor’s rights or debts, signing of license agreement Transfer or transfer the authority of research and development projects, waiver of rights (including waiver of preemptive right, preemptive subscription right, etc.), related party transactions, etc., and establish strict review and decision-making procedures; Major investment projects shall be reviewed by relevant experts and professionals and reported to the general meeting of shareholders for approval.
(I) the board of directors decides to purchase or sell assets, invest abroad (including entrusted financial management, investment in subsidiaries, etc.), provide financial assistance (including entrusted loans, etc.), lease in or lease out assets, entrust or entrust to manage assets and businesses, donate or receive donated assets, restructure creditor’s rights or debts, sign license agreements, transfer or transfer research and development projects The authority to waive rights (including waiver of preemptive right, preemptive right to subscribe capital contribution, etc.) is as follows:
1. The total assets involved in the transaction (if there are both book value and evaluation value, whichever is higher) account for more than 10% and less than 50% of the total assets of the company in the latest audited consolidated statement;
2. Capital involved in the subject matter of the transaction (such as equity)
