Core Points - The document outlines the rules for related party transactions of Jiangsu Yangnong Chemical Co., Ltd, aiming to standardize such transactions, enhance corporate governance, and protect the rights of shareholders [2][3]. Group 1: General Principles - The company must ensure the legality, necessity, reasonableness, and fairness of related party transactions, maintaining independence and avoiding financial manipulation [2][3]. - The board's audit committee is responsible for the daily supervision of related party transactions, conducting checks at least biannually [2][3]. Group 2: Definition of Related Parties - Related parties include both legal entities and natural persons that meet specific criteria, such as controlling or holding more than 5% of the company's shares [2][3]. - Transactions with related parties are defined as resource or obligation transfers, including asset purchases, financial support, and guarantees [6][7]. Group 3: Reporting and Decision-Making Procedures - Directors and major shareholders must report related party relationships to the board, which will maintain a registry [5][6]. - Transactions exceeding certain thresholds require approval from independent directors and must be disclosed, with specific monetary limits set for different types of transactions [9][10]. Group 4: Pricing and Fairness - Related party transactions must be documented with written agreements, ensuring fair pricing based on market standards or reasonable costs [14][15]. - If fair pricing cannot be established, the company must disclose the pricing determination principles and justify their fairness [25]. Group 5: Financial Services and Risk Management - Transactions involving financial companies must adhere to specific regulations, including risk assessments and ongoing monitoring of financial conditions [28][29]. - The company must disclose the terms of financial agreements and ensure that they protect the interests of shareholders [31][32]. Group 6: Daily Transactions and Exemptions - Daily related party transactions can be estimated and reported, with specific procedures for significant changes or renewals [21][22]. - Certain transactions may be exempt from the usual approval and disclosure requirements, such as those that do not involve payment or obligations [12][13]. Group 7: Implementation and Amendments - The rules will take effect upon approval by the shareholders' meeting, with the board authorized to interpret them [44][45].

General Provisions - The rules are established to protect the interests of minority shareholders and ensure the fairness of related party transactions, in accordance with relevant laws and regulations [1][2] - Related transactions conducted by the company's controlling subsidiaries are treated as the company's transactions and are subject to these rules [1] - The controlling shareholders and actual controllers of the company must not use their relationships to harm the company's interests [1] Related Parties and Relationships - Related parties include both legal entities and natural persons that have a special relationship with the company, which may lead to biased interests [7][9] - The company must disclose any relationships that may influence its interests, including those involving directors, senior management, and shareholders holding more than 5% of shares [10][11] Related Transactions - Related transactions are defined as those that may lead to the transfer of resources or obligations between the company and its related parties [12] - The company must ensure that related transactions are legal and compliant, and must not conceal related relationships [2][5] Decision-Making Authority and Procedures - The company must conduct thorough reviews of related transactions, ensuring clarity on the status of transaction targets and the legality of the counterparties involved [13][14] - Specific thresholds for transaction amounts require approval from independent directors and may necessitate shareholder meetings for further scrutiny [6][8] Disclosure Requirements - The company must disclose related transactions that exceed certain financial thresholds, including those involving guarantees or financial assistance to related parties [19][20] - If a transaction involves a significant premium over the book value, the company must provide detailed explanations and ensure protective measures for minority shareholders [14][27] Miscellaneous Provisions - The rules are subject to amendments based on changes in laws and regulations, and they take effect upon approval by the company's board and shareholders [15][34] - The board of directors is responsible for interpreting these rules [15][34]