MicroTech Medical (Hangzhou) Co., Ltd. — Proxy Solicitation & Information Statement 2022

Nov 18, 2022

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult a stockbroker or other registered dealer in securities, a bank manager, solicitor, professional accountant or other professional adviser. If you have sold or transferred all your shares in MicroTech Medical (Hangzhou) Co., Ltd., you should at once hand this circular, together with the enclosed form of proxy, to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

This circular appears for information purpose only and does not constitute an invitation or offer to acquire, purchase or subscribe for any securities of the Company.

==> picture [124 x 46] intentionally omitted <==

==> picture [32 x 43] intentionally omitted <==

MicroTech Medical (Hangzhou) Co., Ltd. ����������������

(A joint stock company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 2235)

(1) PROPOSED A SHARE OFFERING UNDER SPECIFIC MANDATE AND LISTING ON THE SCI-TECH INNOVATION BOARD AND OTHER ANCILLARY RESOLUTIONS;

(2) PROPOSED AMENDMENTS TO ARTICLES OF ASSOCIATION; (3) PROPOSED APPOINTMENT OF INDEPENDENT NON-EXECUTIVE DIRECTOR; AND

(4) NOTICE OF EGM AND CLASS MEETINGS

The Company will convene (i) the EGM at Business Conference Room, 3rd Floor, MicroTech Medical Administration Building, No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China on Wednesday, December 7, 2022 at 2:00 p.m.; (ii) the Class Meeting of the H Shareholders at 2:45 p.m. (or immediately after conclusion of the EGM) and (iii) the Class Meeting of the Domestic Unlisted Shareholders at 3:00 p.m. (or immediately after conclusion at the Class Meeting of the H Shareholders) at the same location, notices of which have been set out on pages 45 to 49, pages 50 to 52 and pages 53 to 55 of this circular. The proxy form for use at the EGM and Class Meetings are enclosed herein, which have also been published on the websites of the Hong Kong Stock Exchange (www.hkexnews.hk) and the Company (www.microtechmd.com).

Whether or not you are able to attend the EGM, please complete and sign the enclosed form of proxy for use at the EGM in accordance with the instructions printed thereon and return it to the H Share Registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong as soon as possible but in any event not less than 24 hours before the time appointed for the EGM (i.e. not later than Tuesday, December 6, 2022 at 2:00 p.m. (Hong Kong time)) or the adjourned meeting (as the case may be). Completion and return of the form of proxy will not preclude Shareholders from attending and voting in person at the EGM if they so wish.

Whether or not you are able to attend the Class Meeting of the H Shareholders, please complete and sign the enclosed form of proxy for use at the Class Meeting of the H Shareholders in accordance with the instructions printed thereon and return it to the H Share Registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong as soon as possible but in any event not less than 24 hours before the time appointed for the Class Meeting of the H Shareholders (i.e., not later than Tuesday, December 6, 2022 at 2:45 p.m. (Hong Kong time)) or the adjourned meeting (as the case may be). Completion and return of the form of proxy will not preclude Shareholders from attending and voting in person at the Class Meeting of the H Shareholders if they so wish.

ClassWhetherMeetingor not ofyoutheareDomesticable to attendUnlistedthe ShareholdersClass Meetinginofaccordancethe DomesticwithUnlistedthe instructionsShareholders,printedpleasethereoncompleteand returnand signit tothetheenclosedCompanyform’s officeof proxyat No.for 108use atLiuzethe Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China as soon as possible but in any event not less than 24 hours before the time appointed for the Class Meeting of the Domestic Unlisted Shareholders (i.e. not later than Tuesday, December 6, 2022 at 3:00 p.m. (Hong Kong time)) or the adjourned meeting (as the case may be). Completion and return of the form of proxy will not preclude Shareholders from attending and voting in person at the Class Meeting of the Domestic Unlisted Shareholders if they so wish.

For joint shareholders of any Shares, only the joint shareholder whose name appears first in the register of members is entitled to accept the certificate for the relevant shares from the Company, and receive notices or other documents of the Company. Any notice delivered to the aforesaid shareholder shall be deemed to have been delivered to all the joint shareholders of the relevant shares. Any joint shareholder may sign the proxy form, provided that if more than one joint shareholderspriority of shareholderswho tendersshalla vote,be determinedwhether inbypersonthe rankingor by proxy,of jointshallholdersbe acceptedin the Companyto the exclusion’s registerofofthemembersvotes ofin therelationothertojointthe shareholders.relevant shares.In this regard, the This circular together with the form of proxy are also published on the websites of Hong Kong Stock Exchange (www.hkexnews.hk) and the Company (www.microtechmd.com).

References to time and dates in this circular are to Hong Kong time and dates.

SPECIAL ARRANGEMENTS FOR THE EGM AND CLASS MEETINGS

Please see page 1 of this circular for measures being taken with a view to prevent and control the spread of the coronavirus disease 2019 (COVID-19) at the EGM and Class Meetings, including:

• compulsory temperature checks and health declarations

• green Hangzhou health QR code and green travel code

• compulsory on-site antigen testing

• wearing of surgical face masks

• no distribution of corporate gifts and refreshments

• any other additional precautionary measures in accordance with the prevailing requirements or guidelines of the government and/or regulatory authorities, or as considered appropriate in light of the development of the COVID-19 pandemic.

Any person who does not comply with the precautionary measures may be denied entry into the venue of the EGM and Class Meetings. The Company requires attendees to wear face masks and reminds Shareholders that they may appoint the Chairman of the meeting as their proxy to vote on the relevant resolutions at the EGM and Class Meetings as an alternative to attending the EGM and Class Meetings in person.

November 21, 2022

TABLE OF CONTENTS

				Page
SPECIAL ARRANGEMENTS FOR THE EGM AND CLASS MEETINGS . . .			. . .	1
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			. . .	5
LETTER FROM	THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		. . .	11
APPENDIX I	–	PLAN FOR STABILIZING A SHARE PRICE WITHIN
		THREE YEARS AFTER INITIAL PUBLIC OFFERING OF
		A SHARES AND LISTING ON THE SCI-TECH BOARD		I-1
APPENDIX II	–	THREE-YEAR DIVIDEND DISTRIBUTION PLAN
		FOR SHAREHOLDERS AFTER THE INITIAL
		PUBLIC OFFERING OF A SHARES AND THE LISTING
		ON THE SCI-TECH BOARD . . . . . . . . . . . . . . . . . . . . . . .	. . .	II-1
APPENDIX III	–	UNDERTAKINGS AND RESTRAINING MEASURES RELATING
		TO THE A SHARE OFFERING . . . . . . . . . . . . . . . . . . . . .	. . .	III-1
APPENDIX IV-A	–	PROPOSED AMENDMENTS TO THE CURRENT
		ARTICLES OF ASSOCIATION . . . . . . . . . . . . . . . . . . . . .	. . .	IVA-1
APPENDIX IV-B	–	PROPOSED AMENDMENTS TO THE ARTICLES
		OF ASSOCIATION FOR THE A SHARE OFFERING	. . .	IVB-1
APPENDIX V	–	REPORT ON THE USE OF PROCEEDS FROM
		THE PREVIOUS OFFERING . . . . . . . . . . . . . . . . . . . . . . .	. . .	V-1
APPENDIX VI	–	RULES OF PROCEDURES FOR THE MEETINGS
		OF SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	VI-1
APPENDIX VII	–	RULES OF PROCEDURES FOR THE BOARD
		OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	VII-1
APPENDIX VIII	–	RULES OF PROCEDURES FOR THE
		SUPERVISORY COMMITTEE . . . . . . . . . . . . . . . . . . . . .	. . .	VIII-1
APPENDIX IX	–	SYSTEM FOR THE INDEPENDENT
		NON-EXECUTIVE DIRECTORS . . . . . . . . . . . . . . . . . . . .	. . .	IX-1
APPENDIX X	–	MANAGEMENT SYSTEM FOR EXTERNAL
		GUARANTEES SYSTEM . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	X-1
APPENDIX XI	–	MANAGEMENT SYSTEM FOR EXTERNAL
		INVESTMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	XI-1
APPENDIX XII	–	MANAGEMENT SYSTEM FOR A SHARE RELATED
		TRANSACTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	XII-1
APPENDIX XIII	–	MANAGEMENT SYSTEM FOR A SHARE
		RAISED PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	XIII-1
APPENDIX XIV	–	INVESTOR RELATIONS MANAGEMENT POLICIES .	. . .	XIV-1
APPENDIX XV	–	REGULATION ON GOVERNING THE TRANSFER OF
		FUNDS WITH RELATED PARTIES . . . . . . . . . . . . . . . .	. . .	XV-1
NOTICE OF THE 2022 FIRST EXTRAORDINARY GENERAL MEETING . .			. . .	45
NOTICE OF THE 2022 SECOND CLASS MEETING
OF HOLDERS	OF H SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		. . .	50
NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS
OF DOMESTIC UNLISTED SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			. . .	53

– i –

SPECIAL ARRANGEMENTS FOR THE EGM AND CLASS MEETINGS

Shareholders will be able to view and listen to the EGM and Class Meetings through a live webcast on a computer, tablet or any browser-enabled device. Shareholders who attend the EGM and Class Meetings online will not be counted to the quorum of the EGM and Class Meetings. Shareholders will need to complete the following steps to be able to access the live webcast of the EGM and Class Meetings of the Company:

ACCESSING PROCEEDINGS OF THE EGM AND CLASS MEETINGS VIA TENCENT MEETING/VOOV MEETING

For Shareholders who would like to view and listen to the EGM and Class Meetings live webcast, you will need to register your interest by sending an email to both ir@microtechmd.com and zhengdai@microtechmd.com providing personal particulars as follows:

• (a) full name (with relevant identification documents);

• (b) registered address;

• (c) number of Shares held (with relevant supporting documents);

• (d) contact telephone number; and

• (e) email address,

no later than 2:00 p.m. on Monday, December 5, 2022 (being not less than forty-eight (48) hours before the time appointed for holding the EGM) to enable the Company to verify the Shareholders’ status. Authenticated Shareholders will receive an email confirmation no later than 2:00 p.m. on Tuesday, December 6, 2022 which contains a link to join the live webcast of the EGM and Class Meetings.

Please keep the hyperlink in safe custody for use at the EGM and Class Meetings and do not disclose them to anyone else. Neither the Company nor its agents assume any obligation or liability whatsoever in connection with the transmission of the link.

VOTE BY APPOINTING A PROXY

All resolutions to be proposed at the EGM and Class Meetings will be decided by way of poll. Shareholders who wish to vote are strongly encouraged to appoint the chairman of the EGM and the Class Meetings as their proxy to vote on the relevant resolution(s) at the EGM and the Class Meetings by completing and returning the proxy form in accordance with the instructions set out therein by a time not less than twenty-four (24) hours before the time appointed for the EGM and the Class Meetings (i.e. 2:00 p.m., 2:45 p.m. and 3:00 p.m. on Tuesday, December 6, 2022), if they have not already done so. Alternatively, Shareholders may attend the EGM and Class Meetings and vote in person.

– 1 –

SPECIAL ARRANGEMENTS FOR THE EGM AND CLASS MEETINGS

The proxy form has been posted to Shareholders together with this circular. The proxy form can be downloaded from the ‘‘Investor Relations’’ section of the Company’s website (www.microtechmd.com) or the website of the Hong Kong Stock Exchange (www.hkexnews.hk). If you are not a registered Shareholder (if your Shares are held via banks, brokers, custodians or the Hong Kong Securities Clearing Company Limited), you should consult directly with your banks or brokers or custodians (as the case may be) to assist you in the appointment of a proxy.

QUESTIONS FROM SHAREHOLDERS

Shareholders may submit any questions they may have in advance in relation to any resolution set out in the notice of EGM and the notices of Class Meetings by 2:00 p.m. on Monday, December 5, 2022 (being not less than forty-eight (48) hours before the date appointed for holding the EGM and the Class Meetings) via email to both ir@microtechmd.com and zhengdai@microtechmd.com providing personal particulars as follows for verification purposes:

• (a) full name (with relevant identification documents);

• (b) registered address;

• (c) number of Shares held (with relevant supporting documents);

• (d) contact telephone number; and

• (e) email address.

ATTENDANCE AT THE VENUE OF THE EGM AND CLASS MEETINGS

In view of the persevering COVID-19 pandemic, the Company will, for prudence’s sake, implement necessary preventive measures at the EGM and the Class Meetings to protect the attending Shareholders and other attendees from the risk of infection. For full details of the preventive measures, please refer to the below sub-section headed ‘‘PREVENTIVE MEASURES’’ in this circular.

PREVENTIVE MEASURES

We are closely monitoring the impact of COVID-19 in China. If there are any changes to be made to the arrangements of the EGM and the Class Meetings following the publication of this circular, we will notify and inform our Shareholders by way of an announcement to be posted on the website of the Company (www.microtechmd.com) and the website of the Hong Kong Stock Exchange (www.hkexnews.hk).

– 2 –

SPECIAL ARRANGEMENTS FOR THE EGM AND CLASS MEETINGS

The Company anticipates that it will implement the following preventive measures at the EGM and Class Meetings to protect attending Shareholders, staff and other stakeholders from the risk of infection:

• (i) Compulsory body temperature checks will be conducted on every attendee at the entrance of the Venue of the EGM and Class Meetings. Any person with a body temperature of over 37.4 degrees Celsius may be denied entry into the Venue or be required to leave the Venue.

• (ii) All attendees are required to complete and submit at the entrance of the Venue a declaration form. Any person who does not comply with this requirement may be denied entry into the Venue or be required to leave the Venue.

• (iii) All attendees are required to show their green Hangzhou Health QR Code and Green Travel Code at the entrance of the Venue. Any person with a Yellow Code or a Red Code may be denied entry into the Venue or be required to leave the Venue.

• (iv) All attendees are required to conduct the on-site rapid antigen testing at the entrance of the Venue. Any person with a positive testing result may be denied entry into the Venue or be required to leave the Venue.

• (v) Attendees are required to wear, at all times, surgical face masks inside the Venue and to maintain a safe distance between seats.

• (vi) No refreshments will be served, and there will be no corporate gifts.

• (vii) Any other additional precautionary measures in accordance with the prevailing requirements or guidelines of the government and/or regulatory authorities, or as considered appropriate in light of the development of the COVID-19 pandemic.

To the extent permitted under law, the Company reserves the right to deny entry into the Venue or require any person to leave the Venue in order to ensure the safety of the attendees at the EGM and Class Meetings. In the interest of all stakeholders’ health and safety and consistent with recent COVID-19 guidelines for prevention and control, the Company reminds all Shareholders that physical attendance in person at the EGM and Class Meetings is not necessary for the purpose of exercising voting rights.

As an alternative, by using proxy forms with voting instructions inserted, Shareholders may appoint the chairman of the EGM and Class Meetings as their proxy to vote on the relevant resolutions at the EGM and Class Meetings instead of attending the EGM and Class Meetings in person.

– 3 –

SPECIAL ARRANGEMENTS FOR THE EGM AND CLASS MEETINGS

Subject to the development of the COVID-19 pandemic and the requirements or guidelines of the government and/or regulatory authorities, the Company may announce further updates on the arrangement of the EGM and Class Meetings on the Company’s website (www.microtechmd.com) and the Hong Kong Stock Exchange’s website (www.hkexnews.hk) as and when appropriate.

If Shareholders have any questions relating to the EGM and the Class Meetings, please contact the H Share Registrar of the Company, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong.

– 4 –

DEFINITIONS

• ‘‘2022 Interim Report’’

• the interim report of the Company for the six months ended June 30, 2022

• ‘‘A Share(s)’’ the ordinary share(s) proposed to be allotted and issued by the Company pursuant to the A Share Offering, with a nominal value of RMB1.00 each in the share capital of the Company, and which will be listed on the Sci-Tech Board of the Shanghai Stock Exchange and traded in RMB

• ‘‘A Share Offering’’

the proposed initial public offering of the Company of not more than 93,460,000 A Shares on the Sci-Tech Board of the Shanghai Stock Exchange in the PRC

• ‘‘A Share Offering Announcement’’ the announcement dated November 16, 2022 published by the Company in relation to, among other things, the proposed A Share Offering, the Specific Mandate and other related matters (including the Proposed Amendments to the Articles of Association for the A Share Offering) and the proposed appointment of an independent nonexecutive Director

• ‘‘Amended Articles of Association’’

• each of the two versions incorporating and consolidating, as applicable, all the Proposed Amendments to the Current Articles of Association and the Proposed Amendments to the Articles of Association for the A Share Offering, respectively

• ‘‘Articles of Association’’ the articles of association of the Company, as amended from time to time

• ‘‘Audit Committee’’

• the audit committee of the Board

• ‘‘Board’’ or ‘‘Board of Directors’’

• the board of Directors of the Company

• ‘‘Business Day’’

• a day on which the Hong Kong Stock Exchange is open for trading and banks in Hong Kong are open for business (excluding Saturdays, Sundays or public holidays)

• ‘‘Class Meetings’’

the Class Meeting of H Shareholders and the Class Meeting of Domestic Unlisted Shareholders, the notices of which have been set out in pages 50 to 55 of this circular

– 5 –

DEFINITIONS

• ‘‘Class Meeting of Domestic Unlisted Shareholders’’

• the 2022 second class meeting of the Domestic Unlisted Shareholders proposed to be held on Wednesday, December 7, 2022 at 3:00 p.m. (or immediately after the conclusion of the Class Meeting of H Shareholders), notices of which or any adjournment thereof are set out on pages 53 to 55 of this circular

• ‘‘Class Meeting of H Shareholders’’ the 2022 second class meeting of the H Shareholders proposed to be held on Wednesday, December 7, 2022 at 2:45 p.m. (or immediately after the conclusion of the EGM), notices of which or any adjournment thereof are set out on pages 50 to 52 of this circular

• ‘‘Company’’

• MicroTech Medical (Hangzhou) Co., Ltd.（微泰醫療器械

• （杭州）股份有限公司）, a joint stock company incorporated in the PRC with limited liability, the H Shares of which are listed and traded on the Main Board of the Hong Kong Stock Exchange

• ‘‘connected person(s)’’ has the meaning ascribed to it under the Hong Kong Listing Rules

• ‘‘Conversion and Listing’’

• the implementation of the Full Circulation Program pursuant to which up to 104,580,329 Domestic Unlisted Shares shall be converted into H Shares with a subsequent listing thereof on the Hong Kong Stock Exchange

• ‘‘Converted H Shares’’

• the 104,580,329 H Shares to be converted from the Domestic Unlisted Shares

• ‘‘COVID-19’’

• the novel coronavirus

• ‘‘CSDC’’

• China Securities Depository and Clearing Corporation Limited

• ‘‘CSRC’’

• the China Securities Regulatory Commission

• ‘‘Director(s)’’

• the director(s) of the Company

• ‘‘Domestic Share(s)’’

the ordinary share(s) issued by the Company in the PRC, with a nominal value of RMB1.0 each, which is or are subscribed for or credited as fully paid up in RMB

• ‘‘Domestic Unlisted Share(s)’’

• the Domestic Share(s) and the Unlisted Foreign Share(s)

– 6 –

DEFINITIONS

• ‘‘Domestic Unlisted the holder(s) of the Domestic Unlisted Share(s) Shareholder(s)’’

• ‘‘Dr. Cheng’’ Dr. Cheng Hua

• ‘‘EGM’’

• the extraordinary general meeting of the Company to be held at the Venue on Wednesday, December 7, 2022 at 2:00 p.m., to consider and, if thought fit, to approve, among other things, (i) the proposed A Share Offering, (ii) the Specific Mandate and other related matters (including the Proposed Amendments to the Articles of Association for the A Share Offering), (iii) the Proposed Amendments to the Current Articles of Association and (iv) the proposed appointment of an independent non-executive Director, or any adjournment thereof

• ‘‘Full Circulation Announcements’’

• the announcements of the Company dated August 3, 2022 and September 1, 2022 in relation to, among other things, the Full Circulation Program and the Conversion and Listing

• ‘‘Full Circulation Program’’

• the full circulation program of the Company to which the approval for the listing of and permission to deal in Converted H Shares had been granted by the Hong Kong Stock Exchange on August 29, 2022, as disclosed in the Full Circulation Announcements

• ‘‘Global Offering’’ the Hong Kong Public Offering and the International Offering

• ‘‘Group’’, ‘‘our Group’’ the Company and its subsidiaries

• ‘‘H Share(s)’’

• the overseas listed foreign share(s) in the share capital of the Company with a nominal value of RMB1.0 each, which is or are subscribed for and traded in HKD and to be listed on the Hong Kong Stock Exchange

• ‘‘H Share Registrar’’ Tricor Investor Services Limited

• ‘‘H Shareholder(s)’’ the holder(s) of the H Share(s)

– 7 –

DEFINITIONS

• ‘‘Hangzhou Hengtai’’

Hangzhou Hengtai Brand Management Partnership (Limited Partnership)（杭州衡泰品牌管理合夥企業（有限合 夥））, a limited partnership established in the PRC on December 11, 2019, of which Dr. Zheng Pan was the sole general partner as at the Latest Practicable Date

• ‘‘Hangzhou Yantai’’ Hangzhou Yantai Investment Partnership (Limited Partnership)（ 杭 州 研 泰 投 資 合 夥 企 業（ 有 限 合 夥 ））, a limited partnership established in the PRC on January 2, 2018, of which Dr. Zheng Pan was the sole general partner as at the Latest Practicable Date

• ‘‘HK$’’ or ‘‘HKD’’

• Hong Kong dollars, the lawful currency of Hong Kong

• ‘‘Hong Kong’’ or ‘‘HK’’

• the Hong Kong Special Administrative Region of the PRC

• ‘‘Hong Kong Listing Rules’’

• the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, as amended from time to time

• ‘‘Hong Kong Public Offering’’

• the offering of 6,353,000 H Shares for subscription by the public in Hong Kong

• ‘‘Hong Kong Stock Exchange’’

• The Stock Exchange of Hong Kong Limited

• ‘‘International Offering’’

the offering of 57,176,500 H Shares (a) in the United States solely to qualified institutional buyers pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the U.S. Securities Act or (b) outside the United States in offshore transactions in reliance on Regulation S under U.S. Securities Act

• ‘‘Latest Practicable Date’’

• November 16, 2022, being the latest practicable date prior to the printing of this circular for the purpose of ascertaining certain information contained herein

• ‘‘MicroTech E-Commerce’’

• Hangzhou MicroTech E-Commerce Co., Ltd.（杭州微泰電 子商務有限公司）, a limited liability company established under the laws of the PRC on September 19, 2019 and a wholly-owned subsidiary of the Company

• ‘‘Nomination Committee’’

the nomination committee of the Board

– 8 –

DEFINITIONS

• ‘‘Over-allotment Option’’

the over-allotment option which may be exercised in respect of such number of A Shares not exceeding 15% of the total number of A Shares to be issued initially under the proposed A Share Offering

• ‘‘PRC’’ or ‘‘China’’

the People’s Republic of China, but for the purposes of this circular and geographic reference only, and unless the context otherwise requires, references to ‘‘PRC’’ in this circular do not apply to Taiwan, Macau and Hong Kong

• ‘‘Proposed Amendments’’

collectively, the Proposed Amendments to the Current Articles of Association and the Proposed Amendments to the Articles of Association for the A Share Offering

• ‘‘Proposed Amendments to the Articles of Association for the A Share Offering’’

the proposed amendments to the articles of association of the Company in connection with the A Share Offering, details of which are set forth in Appendix IV-B to this circular

• ‘‘Proposed Amendments to the Current Articles of Association’’

• the proposed amendments to the current articles of association of the Company, details of which are set forth in Appendix IV-A to this circular

• ‘‘Prospectus’’

• the prospectus of the Company dated October 6, 2021

• ‘‘R&D’’

• research and development

• ‘‘reporting period’’

• has the meaning ascribed to it under the sub-section headed

• ‘‘Confirmation of the Company’s related-party transactions during the three years ended December 31, 2021 and the six months ended June 30, 2022’’ in this circular

• ‘‘Remuneration and Assessment Committee’’

the remuneration and assessment committee of the Board

• ‘‘RMB or Renminbi’’

• Renminbi, the lawful currency of the PRC

• ‘‘Sci-Tech Board’’

• the Sci-Tech Innovation Board of the Shanghai Stock Exchange

• ‘‘Shanghai Stock Exchange’’ The Shanghai Stock Exchange

• ‘‘Share(s)’’ issued share(s) of the Company

– 9 –

DEFINITIONS

‘‘Shareholder(s)’’ the holder(s) of the Shares of the Company ‘‘Specific Mandate’’ a specific mandate to be sought from the Shareholders at the EGM to allot and issue A Shares pursuant to the A Share Offering

• ‘‘Supervisor(s)’’ the supervisor(s) of the Company

• ‘‘Supervisory Committee’’ the supervisory committee of the Company

‘‘Unlisted Foreign Share(s)’’ the ordinary share(s) issued by the Company, with a nominal value of RMB1.0 each, which is or are subscribed for or credited as fully paid in a currency other than RMB, held by foreign investors and not listed on any stock exchange

‘‘Venue’’ Business Conference Room, 3rd Floor, MicroTech Medical Administration Building, No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China ‘‘%’’ per cent

– 10 –

LETTER FROM THE BOARD

==> picture [124 x 46] intentionally omitted <==

==> picture [32 x 43] intentionally omitted <==

MicroTech Medical (Hangzhou) Co., Ltd. ����������������

(A joint stock company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 2235)

Executive Directors: Dr. Zheng Pan (Chairman) Dr. Yu Fei Dr. Shi Yonghui Ms. Liu Xiu

Registered Office: No. 108 Liuze Street Cangqian Street Yuhang District, Hangzhou Zhejiang, China

Non-executive Directors: Mr. Hu Xubo Ms. Gao Yun

Independent Non-executive Directors: Dr. Li Lihua Ms. Gao Jian Ms. Wang Chunfeng Mr. Ho Kin Cheong Kelvin

Headquarters and Principal Place of Business in the PRC: No. 108 Liuze Street Cangqian Street Yuhang District, Hangzhou Zhejiang, China

Principal Place of Business in Hong Kong: 40th Floor, Dah Sing Financial Centre No. 248 Queen’s Road East Wanchai, Hong Kong

November 21, 2022

To the Shareholders

Dear Sir or Madam,

(1) PROPOSED A SHARE OFFERING UNDER SPECIFIC MANDATE AND LISTING ON THE SCI-TECH INNOVATION BOARD AND OTHER ANCILLARY RESOLUTIONS;

(2) PROPOSED AMENDMENTS TO ARTICLES OF ASSOCIATION; (3) PROPOSED APPOINTMENT OF INDEPENDENT NON-EXECUTIVE DIRECTOR; AND

(4) NOTICE OF EGM AND CLASS MEETINGS

I. INTRODUCTION

Reference is made to the A Share Offering Announcement dated November 16, 2022 in relation to, among other things, (i) the proposed A Share Offering, (ii) the Specific Mandate and other related matters (including the Proposed Amendments to the Articles of Association for the A Share Offering), (iii) the Proposed Amendments to the Current Articles of Association, and (iv) the proposed appointment of an independent non-executive Director.

– 11 –

LETTER FROM THE BOARD

The purpose of this circular is to provide you with the details of the resolutions proposed to be considered and approved by you at the EGM and the Class Meetings and relevant information to enable you to make an informed decision on whether to vote for or against or abstain from voting at these resolutions. Such resolutions and information are set out in this letter from the Board.

II. MATTERS TO BE RESOLVED AT THE EGM AND THE CLASS MEETINGS

1. The Proposed A Share Offering

The Company proposes to apply to the relevant regulatory authorities in the PRC for the allotment and issue of not more than 93,460,000 A Shares and proposes to apply to the Shanghai Stock Exchange for the listing of, and permission to deal in, the A Shares on the Sci-Tech Board.

The A Share Offering will be subject to, among other things, the approval by the Shareholders by way of special resolution(s) at the EGM and the Class Meetings, and the requisite approvals by the CSRC and the Shanghai Stock Exchange.

Details of the A Share Offering are set out below:

• (1) Place of listing The Sci-Tech Board of the Shanghai Stock Exchange.

• (2) Class of securities to be issued A Shares.

• (3) Nominal value per Share RMB1.00 each.

• (4) Target subscribers

The target subscribers of the A Shares are inquiring participants who satisfy the relevant qualification requirements prescribed by the CSRC and other relevant regulatory authorities, as well as natural persons, legal persons and other investors who have opened and/or maintained A share securities accounts with the Shanghai Stock Exchange (excluding those who have been prohibited by the relevant PRC laws and regulations).

– 12 –

LETTER FROM THE BOARD

• The Company and the lead underwriter shall strictly comply with the requirements under the Hong Kong Listing Rules and the relevant PRC laws and regulations when conducting offline book building at the time of the A Share Offering, verify the target subscribers ’ connections and relationship with the Company and the lead underwriter and comply with such other requirements, so as to ensure that the target subscribers of the A Share Offering comply with the relevant requirements of the CSRC and the listing rules of the place where the Shares are listed.

• In the event that any connected person of the Company becomes a subscriber of the A Shares, the Company will take every reasonable step to comply with the relevant requirements under the Hong Kong Listing Rules.

• (5) Schedule of the offering

• The Company will proceed with the A Share Offering within 12 months following the approval of the Shanghai Stock Exchange and the CSRC. The Board and the lead underwriter will determine the listing date for the A Shares after the CSRC agrees to the registration of the A Shares and after completion of the offering.

• (6) Method of the offering

• To be conducted through a combination of offline placement and offering by way of on-line capital subscription, or other methods of issuance approved by the CSRC and the Shanghai Stock Exchange (including but not limited to offering to strategic investors). To the best knowledge of the Directors, there is currently no other methods of issuance other than through a combination of off-line placement and offering by way of on-line capital subscription.

• (7) Offering size

• The Company will issue no more than 93,460,000 new A Shares.

– 13 –

LETTER FROM THE BOARD

Assuming that there are no changes to the total issued share capital of the Company prior to the completion of the A Share Offering, the aforesaid maximum number of the new A Shares to be issued under the A Share Offering represents approximately 25.96% and 21.95%, respectively, of the total issued Domestic Unlisted Shares and the total issued share capital of the Company as of the Latest Practicable Date; and approximately 18.00% of the total issued share capital of the Company as enlarged by the issue of the A Shares under the A Share Offering. In the event that any Overallotment Option is exercised, such number of A Shares to be allotted and issued under the Overallotment Option shall not exceed 15% of the total number of new A Shares to be allotted and issued initially under the proposed A Share Offering (and such number of new A Shares to be allotted and issued under the Over-allotment Option shall not be included in the maximum size of the proposed A Share Offering, 93,460,000 A Shares).

Such number will be adjusted accordingly to reflect stock dividend, transfer of capital reserve into capital and any other ex-rights events if occurred prior to the proposed A Share Offering. The actual offering size will be determined by the Board in accordance with the relevant rules and regulations and the authorisation of the general meeting(s) of the Company, and after consideration of the market conditions and consultation with the lead underwriter.

– 14 –

LETTER FROM THE BOARD

The abovementioned offering size is determined on the basis of the present shareholding structure of the Company, the funding needs for carrying out the proposed investment projects and allocations that are to be funded with proceeds from the A Share Offering, the estimated performance of the Company at the time of the A Share Offering, the estimated valuation of the PRC capital market and a combination of other relevant factors.

(8) Pricing methodology

The issue price for the A Shares will be determined by the Company and the lead underwriter in accordance with applicable laws and regulations, or by other pricing methods recognized by the CSRC and the Shanghai S t o c k E x c h a n g e . P u r s u a n t t o t h e Implementation Measures for Issue and Underwriting of Shares on the Sci-Tech Innovation Board of Shanghai Stock Exchange （《上海證券交易所科創板股票發行與承銷實施 辦法》）, the issue price of A Shares shall be determined through price inquiry with professional institutional investors (such as securities firms, fund management companies, trust companies, finance companies, insurance companies, qualified foreign institutional investors and private fund managers). The Company and the lead underwriter may then determine the issue price of A Shares through the initial price inquiry or through cumulative bidding inquiry after an issue price range has been determined from the initial price inquiry.

Based on the Company Law of the PRC, the issue price of the A Shares shall not be lower than the nominal value of the Shares i.e. RMB1.00 per Share. There is no other legal or regulatory requirements stipulating the price floor in the issue of the A Shares under the A Share Offering.

– 15 –

LETTER FROM THE BOARD

• As at December 31, 2021, the net asset value per share of the Company was RMB5.28. The Company does not intend to issue the A Shares at a price lower than the latest audited net asset value per share prior to the A Share Offering. As at the Latest Practicable Date, the closing price of H Share as quoted on the Stock Exchange is HK$5.99 per H Share.

• (9) Implementation of strategic placing upon issue

• Strategic placing will be implemented upon the issue of A Shares, and the total number of A Shares to be placed to strategic investors will not exceed 20% of the total number of A Shares to be issued under the A Share Offering.

The target subscribers of the strategic placing primarily include large-scale enterprises with strategic cooperative relationships and/or longterm cooperative vision with business operations of the Company; publicly offered close-end securities investment funds with main investment strategy including investments in strategic stock placement; related subsidiaries of the sponsors involved in the follow-on investment; the special asset management plan established for the senior management and core employees of the Company to participate in the strategic placing; and other strategic investors who satisfy the requirements under applicable laws and regulations and conform to the development strategy requirements of the Company.

(10) Method of underwriting

The offering will be underwritten by the lead underwriter on a standby commitment basis.

– 16 –

LETTER FROM THE BOARD

• (11) Validity period of the resolutions in relation to the offering

The validity period of the resolution(s) in respect of the A Share Offering is twelve (12) months from the date when this proposal is considered and approved by the Shareholders at the EGM, the Class Meeting of Domestic Unlisted Shareholders and the Class Meeting of H Shareholders.

The Directors consider that a validity period of twelve (12) months for the resolution(s) regarding the proposed A Share Offering is required since there is an uncertainty as to the time required to obtain the requisite approval(s) from the CSRC and other regulatory authorities of the PRC for the A Share Offering.

The Company will seek the Shareholders’ approval for continuing to proceed with the proposed A Share Offering if it does not complete within the 12-month validity period, unless the Board subsequently decides not to proceed further with the proposed A Share Offering.

The allotment and issuance of the A Shares pursuant to the A Share Offering is conditional upon: (1) the grant of the proposed Specific Mandate by the Shareholders to the Board having been obtained at the EGM; and (2) the necessary regulatory approvals from the CSRC and other relevant authorities of the PRC.

The Board may or may not proceed with the A Share Offering, depending on a number of factors, such as market conditions. Shareholders and potential investors are advised to exercise caution when dealing in the securities of the Company. The Company will make further announcement(s) when the detailed terms in relation to the proposed A Share Offering, such as issue price and issue size, have been finalized.

2. Other Resolutions related to the A Share Offering

(1) Authorization to the Board and its authorized persons to deal with specific matters relating to the Proposed A Share Offering with full discretion

A special resolution will be proposed at the EGM and the Class Meetings for consideration and approval of authorization to the Board and its authorized persons to deal with specific matters relating to the initial public offering of A Shares and the listing on the Sci-Tech Board.

– 17 –

LETTER FROM THE BOARD

The scope of authorization covers, without limitation, the following:

1. drafting, amending, supplementing, signing, submitting, reporting, disclosing and executing agreement(s), contract(s), deed(s), declaration(s), undertaking(s), confirmation(s) or necessary documents related to the A Share Offering, including but not limited to letter of intent, prospectus, sponsoring agreement(s), underwriting agreement(s), listing agreement(s), announcements and shareholder circular(s), notice(s), and various explanatory letters or letters of undertaking stipulated by regulatory agencies;

2. making corresponding adjustments to the specific plans for the A Share Offering in accordance with laws, regulations, regulatory documents, relevant stipulations and requirements of securities regulatory authorities and the actual circumstances, and being fully responsible for the specific implementation of such plans (including suspension or termination of implementation of the plans for the A Share Offering), including but not limited to determination of the final issue size, the A Share Offering schedule, the pricing methodology, the issue price, the target subscribers, the placing ratio and other matters related to the A Share Offering;

3. performing all procedures related to the A Share Offering in accordance with laws, regulations, regulatory documents, relevant stipulations and requirements of securities regulatory authorities and the actual circumstances, including but not limited to handling the approval, enrollment, filing, verification, registration, consent and listing procedures with relevant governmental departments, regulatory authorities within and outside the PRC, the Shanghai Stock Exchange and CSDC Shanghai Branch, and making timely information disclosure in accordance with relevant laws and regulations and the Hong Kong Listing Rules; providing statement(s), undertaking(s) and confirmation(s) related to the A Share Offering, and taking other actions that are necessary, expedient or desirable for the purpose of the A Share Offering;

4. designating the special account of proceeds from the A Share Offering, signing the tri-party supervision agreement and dealing with matters related to the use of proceeds in accordance with laws, regulations, regulatory documents and relevant requirements of securities regulatory authorities; adjusting investment projects financed by proceeds from the A Share Offering by basing on the actual progress and the priority of such projects, and making timely information disclosure in accordance with relevant laws and regulations and the Hong Kong Listing Rules;

– 18 –

LETTER FROM THE BOARD

1. engaging sponsor(s), underwriter(s), law firm(s), accounting firm(s) and other intermediaries for the purpose of the A Share Offering, executing engagement agreement(s) or appointment agreement(s), and determining and paying the relevant fees for the A Share Offering;

2. providing necessary supplements and amendments to the Articles of Association and other internal management policies in conformity with the changes of laws, regulations, regulatory documents, the Hong Kong Listing Rules and relevant stipulations of securities regulatory authorities, requirements and suggestions of relevant regulatory authorities within and outside the PRC and the actual circumstances, and making timely information disclosure in accordance with relevant laws, regulations and the Hong Kong Listing Rules; making corresponding amendments to the provisions in the Articles of Association concerning the registered capital and shareholding structure of the Company, and handling the industrial and commercial registration and filing of such changes upon completion of the A Share Offering;

3. for the purpose of the A Share Offering, communicating with relevant regulatory authorities within and outside the PRC (such as the CSRC, the Shanghai Stock Exchange, the Hong Kong Stock Exchange and other regulatory authorities) on behalf of the Company;

4. to the extent permitted by laws, regulations, regulatory documents, the Hong Kong Listing Rules and the Articles of Association, handling other matters related to the A Share Offering on behalf of the Company;

The above authorization is valid for a period of 12 months from the date of approval at the EGM, the Class Meeting of H Shareholders and the Class Meeting of Domestic Unlisted Shareholders.

(2) Investment Projects and/or Allocation to be financed by the Proceeds from the A Share Offering and the Relevant Feasibility Analysis

A special resolution will be proposed at the EGM and the Class Meetings for consideration and approval of investment projects financed by proceeds from the Company’s application for initial public offering of A Shares and listing on the SciTech Board and the relevant feasibility analysis.

– 19 –

LETTER FROM THE BOARD

Proceeds from the A Share Offering (after deducting the expenses and fees related to the A Share Offering) are expected to be utilized in the following manner:

No. Project or Allocation Description 1 Advanced Manufacturing and Production Base 2 Research and Development of Diabetes Medical Devices 3 Marketing Network and Informatization Construction 4 Working Capital Replenishment Total	Proposed investment amount to be funded by the proceeds from the A Share Offering Approximately RMB million 441.00 129.00 55.00 100.00
	725.00

Note: The official description and/or name(s) of the aforesaid projects remain subject to the filing and/or approval (as applicable) with the relevant government authorities.

As at the Latest Practicable Date, none of the aforesaid designated projects have utilized any sources of funding from the Group. The proposed investment funding to the designated projects following completion of the proposed A Share Offering is not expected to utilize any proceeds from the Global Offering.

– 20 –

LETTER FROM THE BOARD

Further details on the use of proceeds for each of the designated projects are set forth below:

		Proposed tentative
		expected timeline
		of the utilization
Designated Project	Further Details	of proceeds
1 Advanced	As disclosed in this circular, given that further funding is required for	Within 5 years
Manufacturing	the new plant construction at newly acquired land sites to meet the	upon completion of
and Production	anticipated capacity requirements for the commercialized products of the	the proposed A
Base	Company, the proposed A Share Offering is expected to fund such	Share Offering
	acquisition(s). The new plant to be established is expected to increase
	production capacity for newly developed products, further allowing the
	Company to meet the increased market demand in the future and to
	equip itself with the expected rise in market share in terms of diabetes
	treatment and monitoring devices.
	The aforesaid allocation shall be differentiated from the proposed
	allocation of proceeds from the Global Offering, which is to fund the
	construction of automation upgrades to the existing plant to meet the
	current manufacturing demand of the Company, which is primarily
	catered for products which the Company has already obtained the
	registration certificate (including, for example, Equil, AiDEX G7, and
	blood glucose meter products).
	As at the Latest Practicable Date, the Company remains in negotiations
	with the relevant regulatory authority on the potential acquisition of land
	use rights.
2 Research and	While proceeds from the Global Offering have been allocated to	Within 5 years
Development of	expenses for the clinical trials and registration for marketing of the Patch	upon completion of
Diabetes Medical	Insulin Pump System Equil, the Continuous Glucose Monitoring System	the proposed A
Devices	(CGMS), the second-generation patch insulin pump system and other	Share Offering
	products underway and planned, the proceeds from the proposed A Share
	Offering are to be utilized to support the R&D of the next generation
	products and the related expenditures during the clinical trials and
	registration process of such category of products. The use of proceeds
	from the A Share Offering shall be sufficiently differentiated from that
	of the Global Offering in this respect.

– 21 –

LETTER FROM THE BOARD

Designated Project Further Details

Proposed tentative expected timeline of the utilization of proceeds

• 3 Marketing Network and Informatization Construction

Whilst the proceeds from the Global Offering are primarily catered for establishing domestic and overseas marketing teams and marketing activities, the use of proceeds to be raised from the proposed A Share Offering shall be skewed towards the establishment of distribution networks, further improvements on the sales and distribution eco-system, and the strengthening of the construction of the digitized system to further elevate the operational management efficiency.

Within 5 years upon completion of the proposed A Share Offering

• 4 Working Capital The remaining proceeds to be raised from the proposed A Share Offering Within 5 years Replenishment are expected to be placed at the capital reserve of the Company for (i) upon completion of meeting the day-to-day operational requirements, (ii) minimizing the the proposed A exposure to market risks, and (iii) making available additional funding Share Offering safeguards for the business development and the R&D for the Group.

After the proceeds raised from the A Share Offering are in place, the Company will invest the proceeds into the above projects according to the actual needs and priorities of the designated projects. The Company will contribute capital to its whollyowned subsidiaries in order to implement the proposed construction project for establishing advanced manufacturing and production base. If the total investment amount of the designated projects exceeds the amount of proceeds raised from the A Share Offering, the excess amount shall be settled by the Company with its own funds. If the proceeds raised from the A Share Offering exceeds the capital requirements of the designated projects, the surplus amount will, after ensuring strict compliance with relevant laws and regulations and the internal protocol of the Company, be utilized for other purposes related to the principal business of the Group.

Before the proceeds to be raised from the A Share Offering are in place, the Company may finance the aforesaid designated projects with its own funds (which shall exclude any proceeds raised from the Global Offering) in accordance with the respective progress of the projects. Following the raising of proceeds from the A Share Offering, the Company anticipates that it will replace the initial investment funds in accordance with the requirements and procedures of the relevant laws and regulations.

The aforesaid investment projects expected to be financed by the proceeds from the A Share Offering serve to develop, improve and supplement the existing principal businesses of the Group in alignment with the relevant industry policies, laws and regulations.

– 22 –

LETTER FROM THE BOARD

The Board has conducted sufficient analysis on the feasibility of the investment projects and allocation to be funded by the proceeds raised from the A Share Offering, and in the opinion of the Directors, the investment projects and allocation to be funded by the proceeds raised from this issuance are feasible. The Board believes that such projects and/or allocation are in line with the national strategy and related industrial policies to encourage and promote the development of healthcare industries. The comprehensive R&D system and solid technical foundation, outstanding commercialization team and promotion system, and relevant experience of the information technology team provide a strong foundation for the implementation of the projects and allocations. Therefore, the Board considered that such projects are feasible.

(3) Proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering

A special resolution will be proposed at the EGM and the Class Meetings for consideration and approval of the proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering.

The proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering is as follows:

As of the Latest Practicable Date, the Company has no undistributed profit retained. If the Company has undistributed profits retained or unrecovered losses before the A Share Offering, both existing and new Shareholders after completion of the A Share Offering are entitled to the distribution or shall undertake such losses in proportion to their respective shareholdings in the Company’s issued share capital after completion of the A Share Offering.

(4) Plan for stabilizing A Share price within three years after the Proposed A Share Offering

A special resolution will be proposed at the EGM and the Class Meetings to consider and approve the plan for stabilization of the price of the A Share for the three years following the completion of the A Share Offering.

The Company has formulated the plan for stabilization of the price of the A Shares for the three years after the A Share Offering in accordance with relevant laws, regulations and regulatory documents. Please refer to Appendix I to this circular for full details.

– 23 –

LETTER FROM THE BOARD

(5) Dilution of immediate returns as a result of the A Share Offering and recovery measures

A special resolution will be proposed at the EGM and the Class Meetings for consideration and approval of the dilution of immediate return as a result of the Company’s initial public offering of A Shares and listing on the Sci-Tech Board and the recovery measures.

To better safeguard the interests of Shareholders, the Company performed analysis of the dilution effect on immediate return as a result of the proposed A Share Offering and devised specific recovery measures in accordance with applicable laws, regulations and regulatory documents, including requirements of securities regulatory authorities and other relevant organizations, and related parties have made undertakings for the full implementation of the measures the Company adopts to recover from the dilution effect, details of which are set out below:

• (i) Specific measures the Company adopts and commitments for recovering from the dilution effect

• Strengthening core businesses and improving the sustainable profitability

The proceeds from the A Share Offering will be used to develop the Company’s core businesses to ensure sustained and stable growth of such businesses. As the Company further enhances the financial strength after the A Share Offering, it will vigorously promote R&D, consolidate and expand the core businesses, so as to improve the comprehensive competitiveness and profitability as well as reduce the risk of dilution of current return to Shareholders resulting from the A Share Offering.

1. Improving operation efficiency and reducing operation costs

The Company will improve asset operation efficiency and working capital turnover efficiency, and strengthen budget management and accounts receivable management. In addition, the Company will improve the remuneration and incentive mechanism to motivate employees and develop their creativity and potential, therefore improving operation efficiency within the organization and reducing costs.

– 24 –

LETTER FROM THE BOARD

1. Strengthening proceeds management and actively promoting investment projects financed by the proceeds to achieve expected investment returns as soon as practicable

After fully receiving the proceeds, the Company will promote the investment projects financed by the proceeds in an orderly manner to enable these projects to reach full capacity as soon as practicable and to achieve expected benefits. In addition, the Company will strictly manage the use of proceeds in accordance with relevant laws and regulations and the Management System for A Share Raised Proceeds developed by itself, to ensure the proceeds would be used effectively according to the original plans, help investment projects financed by the proceeds to reach full capacity as soon as practicable and achieve expected benefits, thereby bringing more returns to the Shareholders and reducing the risk of dilution of current return to Shareholders resulting from the A Share Offering.

1. Strictly implementing the dividend distribution policy to guarantee returns to the Shareholders

In accordance with the Notice on Matters for Further Encouraging Cash Dividends of Listed Companies and the Regulatory Guidelines No. 3 for Listed Companies – the Distribution of Cash Dividends of Listed Companies promulgated by the CSRC, the Company has further improved and refined its profit distribution policy and developed the dividend distribution plans, and will strictly implement said dividend distribution policies to repay investors.

• (ii) Specific measures and undertakings the controlling shareholder and the defacto controller to be adopted for recovering from the dilution effect

The controlling shareholder and de-facto controller undertake that they will not overstep the authority to intervene the Company’s operation and management activities, will not encroach upon the Company’s benefits, and undertake to faithfully implement the measures the Company adopts to recover from the dilution effect and earnestly honor the commitments in this regard. In the case of breaching these undertakings and causing losses to the Company or investors, they willingly assume the liability of compensating the Company or investors in accordance with the laws.

– 25 –

LETTER FROM THE BOARD

• (iii) Specific measures and undertakings the Directors and the senior management to be adopted for recovering from the dilution effect

The Directors and senior management of the Company undertake:

1. not to be engaged in tunneling in favor of other units or individuals on a nil-payment basis or upon unfair terms, or otherwise compromise the interests of the Company;

2. to exercise restraint in spending when performing duties;

3. not to use the Company’s assets for investment or consumption activities that are not related to the performance of duties;

4. to procure, within his/her scope of duty and authority, that the remuneration policies formulated by the Board or the Remuneration and Assessment Committee to be linked with the implementation of the Company’s recovery measures;

5. in the event that the Company implements a share incentive plan at a later stage, to procure (within his/her scope of duty and authority) that the exercise conditions under such incentive plan to be in line with the recovery measures to be implemented by the Company;

6. to faithfully honor the above undertakings and willingly assume the liabilities arising from breaching these undertakings.

(6) Plan for dividend distribution to Shareholders in three years after the A Share Offering

A special resolution will be proposed at the EGM and the Class Meetings for consideration and approval of the Plan for Dividend Distribution to Shareholders in Three Years after the Initial Public Offering of A Shares and Listing on the Sci-Tech Board. Full text of the plan is set out in Appendix II of this circular.

(7) Undertakings and restraining measures relating to the A Share Offering

A special resolution will be proposed at the EGM and the Class Meetings for consideration and approval of the Company’s undertakings and restraining measures in respect of the A Share Offering.

To better safeguard the interests of Shareholders, the Company proposes to provide undertakings and relevant restraining measures in respect of the proposed A Share Offering, full details of which are set out in Appendix III of this circular.

– 26 –

LETTER FROM THE BOARD

(8) Proposed Amendments to the Articles of Association

In order to (i) prepare for the proposed A Share Offering, (ii) comply with the relevant CSRC and Shanghai Stock Exchange rules, (iii) further improve and standardize the Articles of Association and adopt other consequential and housekeeping amendments, (iv) satisfy the relevant requirements of laws, administrative regulations and regulatory documents, including the Company Law of the PRC, the Guidelines for Articles of Association of Listed Companies and the Rules Governing the Listing of Securities on the Sci-Tech Innovation Board of the Shanghai Stock Exchange, (v) comply with the core shareholder protection standards as set out in Appendix 3 to the Hong Kong Listing Rules which became effective on January 1, 2022, and (vi) take the practical circumstances of the Company into consideration (including without limitation, the expected timeline of completion of the Full Circulation Program), the Board resolved to amend the existing Articles of Association.

The Amended Articles of Association which reflects the Proposed Amendments to the Articles of Association for the A Share Offering shall become effective (i) following the Shareholders’ approval at the EGM, and (ii) upon completion of the proposed A Share Offering, whereupon the then existing Articles of Association will be invalid simultaneously.

The details of the Proposed Amendments to the Current Articles of Association and the Proposed Amendments to the Articles of Association for the A Share Offering, which have been prepared in Chinese, are set out in Appendix IV-A and Appendix IV-B of this circular. In the event of any discrepancy between the English translation and the Chinese version of the Proposed Amendments, the Chinese version shall prevail.

For the avoidance of doubt, given that the proposed A Share Offering is conditional upon, among other things, necessary regulatory approvals, there is no assurance that it will proceed as planned or at all. Therefore, despite the fact that the Shareholders will consider and, if thought fit, approve the adoption of both versions of the Amended Articles of Association, only one version of it will become effective at the time immediately following the EGM. The effect of the Shareholders considering, and if thought fit, approving both versions of the Amended Articles of Association is that, before and until the A Share Offering has been successfully completed, the version of the Amended Articles of Association incorporating and consolidating all the Proposed Amendments to the Current Articles of Association will have remained effective and, vice versa.

The Proposed Amendments to the Current Articles of Association, the Proposed Amendments to the Articles of Association for the A Share Offering as well as the adoption of both versions of the Amended Articles of Association are subject to the

– 27 –

LETTER FROM THE BOARD

Shareholders’ approval by way of special resolutions at the EGM. Save that the proposed A Share Offering shall be subject to, among others, the approval of the CSRC, the Proposed Amendments to the Articles of Association for the A Share Offering do not require a separate approval from the CSRC.

Both versions of the amended Articles of Association (reflecting the Proposed Amendments to the Current Articles of Association or the Proposed Amendments to the Articles of Associations for the A Share Offering) comply with the core shareholder protection standards under Appendix 3 to the Hong Kong Listing Rules as amended under the new listing regime for the PRC issuers effective on January 1, 2022.

(9) Engagement of intermediaries

To ensure smooth progress of the A Share Offering, the Company proposes to engage China International Capital Corporation Limited, Grandall Law Firm (Hangzhou) and Pan-China Certified Public Accountants LLP, respectively, as the sponsor, the legal adviser and the auditor of the A Share Offering.

An ordinary resolution will be proposed at the EGM to consider and approve the above engagement.

• (10) Confirmation of the Company’s related-party transactions during the three years ended December 31, 2021 and the six months ended June 30, 2022

The Board has confirmed the respective status of the following transactions with related parties during the reporting period (the three years ended December 31, 2021 and the six months ended June 30, 2022, collectively, the ‘‘reporting period’’) and considered that such related party transactions were conducted according to the relevant laws and regulations, in line with commercial principles, and the pricing of the transactions were not more favorable than similar transactions conducted with nonrelated parties. Further details of such related-party transactions are set forth below.

This proposal has been approved by the Board, and shall be submitted to the EGM for consideration and approval by way of an ordinary resolution. Dr. Zheng Pan, being an executive Director and chairman of the Board, has abstained from voting on this proposal at the relevant meeting of the Board.

To the best of the Directors’ knowledge, information and belief, as at the Latest Practicable Date, the related Shareholders were (i) Dr. Zheng Pan, (ii) Hangzhou Hengtai and (iii) Hangzhou Yantai, each of whom shall abstain from voting on the relevant ordinary resolution to be proposed at the EGM.

– 28 –

LETTER FROM THE BOARD

1. Recurring Related-party Transactions

(1) Related-party purchases

Details of various purchases of goods and receipt of services from related parties of the Group are set forth below:

Unit: RMB’0,000

		For the	For the	For the	For the
		six months	year ended	year ended	year ended
	Item/Transaction	ended June 30,	December 31,	December 31,	December 31,
Name of related party	Description	2022	2021	2020	2019
Jinhua City Wucheng District Jingxin Trading	Portable blood	–	–	118.23	–
Corporation（金華市婺城區景欣貿易商行）	glucose monitoring
Jinhua City Wucheng District Qirui Trading	kit	–	–	59.35	–
Corporation（金華市婺城區祺瑞貿易商行）
Jinhua City Wucheng District Jingqi Trading		–	–	–	109.59
Corporation（金華市婺城區景祺商貿行）
Hangzhou Henghua Property Services Co., Ltd.	Property management
（杭州衡華物業服務有限公司）	fee	47.22	–	–	–
Total		47.22	–	177.58	109.59

(2) Related-party sales

During the reporting period, the Company had not sold goods or provided services to related parties.

(3) Remunerations of related parties

Remunerations of Directors, Supervisors and members of the senior management (excluding Directors or Supervisors not receiving compensations and allowances) during the reporting period are set forth below:

Unit: RMB’0,000

				Total
Year				remuneration
2019				50.67
2020				309.73
2021				659.59
January	to	June	2022	339.65

– 29 –

LETTER FROM THE BOARD

1. Non-recurring related-party transactions

2. (1) Related-party guarantees

Unit: RMB’0,000

				Whether the	Whether the
	Guaranteed			guarantee has
Guarantor	party	Amount	Term	been fulfilled
Dr. Zheng Pan	The Company	1,000	Two years from the expiry date of the duration of		Fulfilled
			principal creditor’s right (March 21, 2019 to
			March 20, 2020)
Dr. Zheng Pan	The Company	1,000	Two years from the expiry date of the duration of		Fulfilled
			principal creditor’s right (March 11, 2020 to
			March 10, 2022)

• (2) Related-party loans

During the reporting period, the Company provided loans to related parties, details of which are shown below:

		Unit:	RMB’0,000
Related party	Amount	Start date	Expiry date
Dr. Zheng Pan	1,000.00	March 28,	March 11,
		2019	2020
	1,000.00	March 11,	September
		2020	28, 2020
Shukang Biomedical (Hangzhou)	50.00	June 30,	July 8,
Co., Ltd.		2020	2020

– 30 –

LETTER FROM THE BOARD

3. Related-party receivables and payables

(1) Receivables from related parties

Unit: RMB’0,000

		As at	As at	As at	As at
		June 30,	December 31,	December 31,	December 31,
Item	Related party	2022	2021	2020	2019
Other	Dr. Zheng Pan	–	–	–	962.22
receivables
	Total	–	–	–	962.22
Prepayments	Jinhua City Wucheng District Jingxin	–	–	–	12.31
	Trading Corporation（金華市婺城區景欣
	商貿行）
	Total	–	–	–	12.31

(2) Payables to related parties

Unit: RMB’0,000

		As at	As at	As at	As at
		June 30,	December 31,	December 31,	December 31,
Item	Related party	2022	2021	2020	2019
Accounts	Jinhua City Wucheng District Jingqi	–	–	–	24.92
payable	Trading Corporation（金華市婺城區景祺
	商貿行）
	Total	–	–	–	24.92

– 31 –

LETTER FROM THE BOARD

4. Others

In 2020, Ms. Xu Fangling（徐方玲）, the vice president of the Company, transferred the 24.50% equity interest held by her in MicroTech E-Commerce to the Company at nil consideration, as Ms. Xu Fangling had not contributed capital into MicroTech E-Commerce.

(11) Report on the use of proceeds from the previous offering

In accordance with applicable laws, regulations and regulatory documents, including stipulations of securities regulatory authorities and other relevant organizations, the Company has prepared a report titled ‘‘Report on the Use of Proceeds from the Previous Offering’’, full details of which are set out in Appendix V to this circular.

An ordinary resolution will be proposed at the EGM to consider and approve the above report.

(12) Amendment or formulation of internal management policies of the Company

To meet the requirements of the proposed A Share Offering, the Company amends or formulates the following internal management policies in accordance with applicable laws, regulations and regulatory documents, including stipulations of securities regulatory authorities and other relevant organizations, and on the basis of its actual conditions:

No. Title of policy Amendment

• 1 RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

• 2 RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS 3 RULES OF PROCEDURES FOR THE SUPERVISORY COMMITTEE 4 SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS 5 MANAGEMENT SYSTEM FOR EXTERNAL GUARANTEES SYSTEM 6 MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT Formulation

• 7 MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• 8 MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS 9 INVESTOR RELATIONS MANAGEMENT POLICIES 10 REGULATION ON GOVERNING THE TRANSFER OF FUNDS WITH RELATED PARTIES

• The full text of the above policies is set out in Appendices VI to XV to this circular.

– 32 –

LETTER FROM THE BOARD

An ordinary resolution will be proposed at the EGM to consider and approve the aforesaid internal management policies.

The above internal management policies will come into effect on the date of completion of the proposed A Shares Offering on the Sci-Tech Board, except for the policy numbered 10 above which shall come into effect on the date of approval of the EGM and the Class Meetings. Until then, the current internal management policies (as applicable) will continue to apply.

In the event of any discrepancy between the English translation and the Chinese version of the proposed amendments to the internal management policies, the Chinese version shall prevail.

3. Proposed Election of an Independent Non-executive Director and Change in Composition of Board Committees

As disclosed in the A Share Offering Announcement dated November 16, 2022, due to personal work commitment, Ms. Gao Jian has tendered her resignation as an independent non-executive Director and will cease to act as an independent non-executive Director, the chairman of the Audit Committee and a member of the Nomination Committee with effect from the conclusion of the EGM. Ms. Gao Jian has confirmed to the Board that she has no disagreement with the Board and there are no other matters in relation to her resignation that need to be brought to the attention of the Shareholders. In place of Ms. Gao Jian’s position as the chairman to the Audit Committee, Mr. Ho Kin Cheong Kelvin has been nominated to act as the chairman to the Audit Committee with effect from the conclusion of the EGM.

Ms. Wang Chunfeng, an independent non-executive Director, has been nominated to serve as a member of the Audit Committee with effect from the conclusion of the EGM.

Dr. Cheng Hua (‘‘Dr. Cheng’’) has been nominated (i) as a candidate for the position of independent non-executive Director, which is subject to the approval by the Shareholders at the EGM, and (ii) to serve as a member of the Nomination Committee.

– 33 –

LETTER FROM THE BOARD

The Nomination Committee, having reviewed the composition of the Board and each of the Audit Committee and the Nomination Committee, and having assessed the background and experience of Dr. Cheng, recommended that Dr. Cheng be appointed as an independent non-executive Director and to propose the relevant resolution(s) at the EGM in accordance with the nomination policy and board diversity policy of the Company (which takes into factors such as, including without limitation, gender, age, cultural and educational background, ethnicity, geographical location, professional experience, skills, knowledge and length of service into consideration). Dr. Cheng has confirmed his independence pursuant to Rule 3.13 of the Hong Kong Listing Rules. The Nomination Committee has also assessed and was satisfied with the independence of Dr. Cheng.

In view of the extensive knowledge and invaluable experience of Dr. Cheng, the Board accepted the aforesaid nomination from the Nomination Committee as to the proposed appointment of Dr. Cheng. It is expected that Dr. Cheng will bring a broader perspective to the Board and provide new thoughts for the Company’s overall strategic planning and business development. The Board is of the view that the appointment of Dr. Cheng is in the best interests of the Company and the Shareholders as a whole.

An ordinary resolution will be proposed at the EGM to consider and approve the proposed appointment of Dr. Cheng as an independent non-executive Director.

Biographical Particulars of Dr. Cheng

Dr. Cheng Hua, aged 58, acted as the deputy director of Institute of Science and Technology, Zhejiang Sci-Tech University from November 2005 to November 2016, the director of School of Economics and Management, Zhejiang Sci-Tech University from December 2016 to December 2020, and an instructor of Department of Business Management, Zhejiang Sci-Tech University from December 2020. Since December 2020, Dr. Cheng has been working as an independent director of Zhejiang Xingxing Refrigeration Co., Ltd. Dr. Cheng was awarded a bachelor’s degree in management engineering in July 1986 by Donghua University (formerly known as China Textile University), a master’s degree in business management in March 1992 by Shanghai University of Finance and Economics, and a doctoral degree in agricultural economics and management in March 2004 by School of Management, Zhejiang University.

The Company will enter into a letter of appointment with Dr. Cheng for a term from the date of the forthcoming EGM to the end of the first session of the Board. Dr. Cheng will receive RMB100,000 per annum as allowance for his service as an independent non-executive Director.

– 34 –

LETTER FROM THE BOARD

Saved as disclosed above, as at the Latest Practicable Date, (i) Dr. Cheng did not hold any other directorships in other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the past three years or other major appointments and professional qualifications; (ii) Dr. Cheng was not related to any Directors, Supervisors, senior management or substantial Shareholders; (iii) Dr. Cheng was not interested in any Shares within the meaning of Part XV of the Securities and Futures Ordinance (Cap 571 of the Laws of Hong Kong); and (iv) Dr. Cheng did not hold any other position with the Company or other members of the Group. Saved as disclosed above, as at the Latest Practicable Date, Dr. Cheng has confirmed that there are no matters that need to be brought to the attention of the Shareholders and there is no other information in relation to his appointment as an independent non-executive Director that is required to be disclosed pursuant to Rules 13.51(2)(h) to 13.51(2)(v) of the Hong Kong Listing Rules.

III. OTHER INFORMATION IN RELATION TO THE PROPOSED A SHARE OFFERING

1. Reasons for and benefits of the Proposed A Share Offering

The Board considers that the A Share Offering on the Sci-Tech Board will enable the Company to access the PRC capital market by way of equity financing, improve its capital structure, and accelerate the business development of the Group while strengthening its competitiveness. Furthermore, the Directors considered that the A Share Offering is beneficial to, and is in the best interests of, the Company and its Shareholders as a whole for the following reasons:

(a) Branding and benefits as a dual listed company

The A Share Offering will enable the Company to obtain listing status at stock markets in the PRC mainland and Hong Kong, thereby further enriching its capital base and establishing both domestic and international financing platforms.

Since its establishment, the Sci-Tech Board has attracted a number of companies with extraordinary technological capabilities. A listing on the Sci-Tech Board would be beneficial to the Company by further enhancing its brand image and influence in the domestic market, and promoting the overall value and interests of the Company and its Shareholders.

– 35 –

LETTER FROM THE BOARD

As a dual listed company, the Company will be required to comply with the listing rules of both the Hong Kong Stock Exchange and the Shanghai Stock Exchange, which shall further optimize the Company’s corporate governance structure and provide a higher level of corporate transparency to Shareholders and potential investors, which is conducive to safeguarding the interests of the Shareholders as a whole.

(b) Further funding needs to be met by proceeds from the A Share Offering

While the proceeds raised from the Global Offering serve to provide strong support for the R&D and commercialization of the core products and other key products of the Company, the proceeds from the A Share Offering will enable the Company to meet the anticipated capacity requirements for commercialized products, further advance our R&D, clinical trials and registration of new generation of products, and continue to strengthen the sales and management capabilities of the Group.

While the proceeds from the Global Offering have been allocated to be utilized for production line upgrades, personnel recruitment and machine acquisitions at existing sites as disclosed in the Prospectus, further funding is required for new plant construction at newly acquired land sites to meet the anticipated capacity requirements for the commercialized products of the Company.

Although proceeds from the Global Offering have been allocated to be utilized on the expenses for the clinical trials and registration for marketing of the Patch Insulin Pump System Equil, the Continuous Glucose Monitoring System (CGMS), the second-generation patch insulin pump system and other products underway and planned, it is anticipated that further funding may be required to support the R&D of a new generation of products and related expenditures during the clinical trials and registration process of the products.

Furthermore, as the Company is gradually evolving to becoming an enterprise with more commercialized products, the Company foresees the need to undertake construction for its regional marketing centers to further enhance the local accessibility and popularity of the main products of the Group. Meanwhile, the Company will strengthen the construction of its information management system to optimize business processes management and enhance the efficiency of its operation and management, so as to further establish and strengthen the Company’s sales and management capabilities.

As the Company maintains its rapid growth momentum and continues to move towards the commercialization stage, the A Share Offering can provide the Company with additional capital, in addition to the proceeds raised from the Global Offering, to enable the Company to undertake the necessary expansion of production capacity and promote the further R&D and commercialization of its pipeline products.

– 36 –

LETTER FROM THE BOARD

2. Effects of the Proposed A Share Offering on the Shareholding Structure of the Company

Upon completion of the A Share Offering, all the then-existing Domestic Shares and Unlisted Foreign Shares (excluding those to be converted and listed pursuant to the Full Circulation Program) shall be converted into A Shares and become listed on the Sci-Tech Board. Such converted A Shares shall be deposited in CSDC and are subject to lock-up periods as required under relevant PRC laws and regulations.

As disclosed in the Full Circulation Announcements respectively dated August 3, 2022 and September 1, 2022, the Company has received the official approval from the CSRC and the Hong Kong Stock Exchange for the conversion of a total of 104,580,329 Domestic Unlisted Shares into H Shares and their listing on the Hong Kong Stock Exchange. As at the Latest Practicable Date, the Conversion and Listing remained subject to completion of all other required procedures. Nevertheless, the Company anticipates that the Conversion and Listing shall be completed prior to the completion of the A Share Offering. In this regard, the Company will make further announcement(s) to keep its Shareholders informed as to any further development and/or progress on the Conversion and Listing in accordance with the requirements under the Hong Kong Listing Rules and other applicable rules and regulations.

For reference and illustration purposes only, assuming that (i) there are no changes to the total issued share capital of the Company prior to the completion of the A Share Offering; (ii) a maximum of 93,460,000 new A Shares are issued under the A Share Offering (which represents approximately 21.95% of the total issued share capital of the Company as at the Latest Practicable Date and approximately 18.00% of the total issued share capital of the Company as enlarged by the issue of the A Shares under the A Share Offering), the shareholding structure of the Company (a) as at the Latest Practicable Date; (b) immediately before the completion of the A Share Offering and following the completion of the Conversion and Listing pursuant to the Full Circulation Program; and (c) immediately after the completion of the A Share Offering has been set forth as follows:

– 37 –

LETTER FROM THE BOARD

				Immediately before the	Immediately before the
				completion of the A Share
				Offering and	following the
				completion of the Conversion		Immediately	after the
	As at the Latest		Practicable	and Listing pursuant to the		completion of	the	A Share
	Date			Full Circulation Program		Offering
			Approximate		Approximate			Approximate
			percentage in		percentage in		percentage in
		the total issued			the total issued		the total issued
	Number of	share capital of		Number of	share capital of	Number of	share capital of
	Shares		the Company	Shares	the Company	Shares	the Company
			(Note 3)		(Note 3)			(Note 3)
Dr. Zheng Pan, an executive Director and the chairman
of the Board
(1) Domestic Shares (Note 1)	123,008,156		28.89%	82,009,537	19.26%	–		–
(2) H Shares	56,200		0.01%	56,200	0.01%	56,200		0.01%
(3) H Shares to be converted from Domestic Shares (Note 1)	–		–	40,998,619	9.63%	40,998,619		7.90%
(4) A Shares to be converted from Domestic Shares (Note 1)	–		–	–	–	82,009,537		15.80%
Sub-total	123,064,356		28.91%	123,064,356	28.91%	123,064,356		23.70%
Other Shareholders
(1) Domestic Shares	163,465,418		38.40%	129,713,450	30.47%	–		–
(2) Unlisted Foreign Shares	73,526,426		17.27%	43,696,684	10.26%	–		–
(3) A Shares to be converted from existing Domestic Shares
(Note 2)	–		–	–	–	129,713,450		24.98%
(4) A Shares to be converted from existing Unlisted Foreign
Shares (Note 2)	–		–	–	–	43,696,684		8.42%
(5) H Shares to be converted from existing Domestic Shares
(Note 2)	–		–	33,751,968	7.93%	33,751,968		6.50%
(6) H Shares to be converted from existing Unlisted Foreign
Shares (Note 2)	–		–	29,829,742	7.01%	29,829,742		5.75%
(7) Other H Shares	65,686,400		15.43%	65,686,400	15.43%	65,686,400		12.65%
New A Shares to be allotted and issued pursuant to the
A Share Offering	–		–	–	–	93,460,000		18.00%
Total number of Shares	425,742,600		100%	425,742,600	100%	519,202,600		100%
Total number of H Shares	65,742,600		15.44%	170,322,929	40.01%	170,322,929		32.80%
Total number of Domestic Unlisted Shares	360,000,000		84.56%	255,419,671	59.99%	–		–
– Domestic Shares	286,473,574		67.29%	211,722,987	49.73%	–		–
– Unlisted Foreign Shares	73,526,426		17.27%	43,696,684	10.26%	–		–
Total number of A Shares	–		–	–	–	348,879,671		67.20%

Notes:

1. As at the Latest Practicable Date, Dr. Zheng Pan was deemed to be interested in an aggregate of 123,008,156 Domestic Shares, amongst which, (i) 88,278,594 Domestic Shares, representing approximately 30.82% of the total relevant class of Shares and approximately 20.74% of the total issued Shares, were held by him directly; 19,031,297 Domestic Shares, representing approximately 6.64% of the total relevant class of Shares and approximately 4.47% of the total issued Shares, were held by Hangzhou Yantai directly; and 15,698,265 Domestic Shares, representing approximately 5.48% of the total relevant class of Shares and approximately 3.69% of the total issued Shares, were held by Hangzhou Hengtai directly.

2. References are made to the Full Circulation Announcements at which the Company disclosed that a total of 14 participating holders of 74,750,587 Domestic Shares and 4 participating holders of 29,829,742 Unlisted Foreign Shares shall participate in the Conversion and Listing pursuant to the Full Circulation Program.

3. Certain figures included in the table above have been rounded to the nearest integer or to two decimal places. Any discrepancies between the total shown and the sum of the amounts listed are due to rounding.

– 38 –

LETTER FROM THE BOARD

At the time of the listing of the H Shares on the Hong Kong Stock Exchange, the Hong Kong Stock Exchange has granted the Company a waiver from strict compliance with the requirements of Rule 8.08(1)(a) of the Hong Kong Listing Rules, pursuant to which the Company is required to maintain a minimum public float (as defined under the Hong Kong Listing Rules) at the higher of: (1) 15% of the total issued share capital of the Company; or (2) such percentage of H Shares to be held by the public immediately after the completion of the Global Offering and the exercise of the over-allotment option thereof (if any). Details of the waiver in relation to public float is set out in ‘‘Waiver in respect of the Public Float Requirement’’ in the Prospectus.

Following the Global Offering (including full exercise of the over-allotment option), to the best of knowledge of the Company having made all reasonable enquiries, as of the Latest Practicable Date, the Company maintained a minimum public float of H Shares of approximately 15.4%.

Assuming that a maximum of 93,460,000 A Shares shall be issued for the A Share Offering, it is expected that a total of 379,508,579 Shares, representing 73.09% of the total issued share capital of the Company (as enlarged by the issue of the A Shares under the A Share Offering) will be held by the public (including H Shares and A Shares held by the public but excluding any H Shares and A Shares held by the substantial shareholders, Directors, Supervisors, chief executive of the Company and their respective close associate(s)) following the completion of the A Share Offering. As such, the Company would still be able to meet the minimum requirement in respect of the public float percentage under the Hong Kong Listing Rules as imposed by the Hong Kong Stock Exchange at the time of the Global Offering.

The Company endeavors to closely monitor its public float percentage (including H Shares and A Shares held by the public) to maintain the percentage of listed securities held by the public above the minimum level prescribed by Rule 8.08 of the Hong Kong Listing Rules at all times, including during the stabilization period for the newly issued A shares. The Company will also ensure its compliance with relevant requirements on public float as stipulated under the Hong Kong Listing Rules and will promptly notify the Hong Kong Stock Exchange of any changes in the Company’s public float.

– 39 –

LETTER FROM THE BOARD

3. Fundraising activities in the past twelve months

On October 19, 2021, the Company issued 63,529,500 H Shares on the Hong Kong Stock Exchange at the price of HK$30.50 per H Share by way of initial public offering. As a part of such Global Offering, the over-allotment option thereof was partially exercised on November 10, 2021 and the Company further issued a total of 2,213,100 H Shares at the price of HK$30.50 per H Share. After deducting the underwriting commissions and other relevant expenses, the Company received net proceeds of approximately HK$1,875.53 million (equivalent to RMB1,533.49 million) in connection with the Global Offering and the partial exercise of the over-allotment option thereof.

The expected net proceeds from the Global Offering as disclosed in the Prospectus are recapped as follows:

• 31% allocated to our Core Product as follows:

• (i) 14% will be used to fund ongoing and planned clinical trials of our Core Product for its further development, including but not limited to clinical trials for our Core Product’s indication expansion, to prepare for and carry out registration of our Core Product in major markets worldwide;

• (ii) 11% will be used to enhance our commercialization capabilities for our Core Product through expanding our global footprint by recruiting highcaliber sales staff with extensive local experience and establishing longterm cooperation with leading distribution partners, and organizing and participating in academic conferences and activities, among other efforts;

• (iii) 6% will be used to fund the expansion of our manufacturing capacity of our Core Product, by upgrading our existing production lines, recruiting personnel and purchasing new machinery;

• 35% allocated to our Continuous Glucose Monitoring System (CGMS) as follows:

• (i) 10% will be used to fund the pre-clinical studies, including but not limited to developing the second generation of our CGMS product, AiDEX X, which is designed for non-intensive diabetics, pre-diabetics, and healthaware non-diabetic users;

• (ii) 12% will be used to fund clinical trials of our AiDEX G7, including but not limited to clinical trials for its indication expansion to use by children and adolescents and clinical trials for the development of our AiDEX X, to prepare for and carry out its registration in major markets worldwide;

– 40 –

LETTER FROM THE BOARD

• (iii) 6% will be used to fund the expansion of our manufacturing capacity of our CGMS, by upgrading our existing production lines and purchasing new machinery;

• (iv) 7% will be used to enhance our commercialization capabilities for our CGMS through expanding our global footprint by recruiting high-caliber sales staff with extensive local experience and establishing long-term cooperation with leading distribution partners, and organizing and participating in academic conferences and activities, among other efforts;

• 11% allocated to the pre-clinical studies, clinical trials, registration, manufacturing and commercialization of our second-generation patch insulin pump system. We are currently working on the design of our secondgeneration patch insulin pump system;

• 8% allocated to the pre-clinical studies, clinical trials, registration, manufacturing and commercialization of our other products and product candidates;

• 5% used to fund the establishment of our cloud-based diabetes management platform; and

• 10% allocated for working capital and other general corporate purposes;

As at June 30, 2022, the Company has utilized approximately RMB99.76 million of the net proceeds raised from the Global Offering. Further particulars on the detailed utilization of such funds raised from the Global Offering has been disclosed in the 2022 Interim Report.

The remaining proceeds will be used according to the plans and timeline disclosed in the Prospectus and the 2022 Interim Report, respectively.

Save and except for the aforesaid fundraising activity, the Company has not engaged in any other fundraising activity that involves the issue of equity securities during the 12 months immediately prior to the Latest Practicable Date.

IV. EGM

The notice convening the EGM at the Venue on Wednesday, December 7, 2022 at 2:00 p.m. is set out on pages 45 to 49 in this circular.

The proxy form for use at the EGM is enclosed in this circular and published on the website of the Hong Kong Stock Exchange (www.hkexnews.hk) and the Company (www.microtechmd.com).

– 41 –

LETTER FROM THE BOARD

If you intend to attend the EGM by proxy, you are required to return the duly completed accompanying proxy form according to the instructions printed thereon. Shareholders who intend to attend the EGM by proxy are required to duly complete the proxy form and return the same to Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong (for holders of H Shares) or the Company’s office at No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China (for Domestic Unlisted Shareholders) as soon as practicable but in any event not less than twenty-four (24) hours before the time appointed for holding the EGM (i.e., not later than December 6, 2022 at 2:00 p.m.), or any adjourned meeting thereof (as the case may be). Completion and return of the proxy form will not preclude you from attending and voting in person at the EGM.

V. CLASS MEETING OF THE H SHAREHOLDERS

The notice convening the Class Meeting of H Shareholders at the Venue on Wednesday, December 7, 2022 at 2:45 p.m. (or immediately after conclusion of the EGM) is set out on pages 50 to 52 in this circular.

The proxy form for use at the Class Meeting of H Shareholders is enclosed in this circular and published on the website of the Hong Kong Stock Exchange (www.hkexnews.hk) and the Company (www.microtechmd.com).

If you intend to attend the Class Meeting of H Shareholders by proxy, you are required to return the duly completed accompanying proxy form according to the instructions printed thereon. Shareholders who intend to attend the Class Meeting of H Shareholders by proxy are required to duly complete the proxy form and return the same to Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong as soon as practicable but in any event not less than twenty-four (24) hours before the time appointed for holding the Class Meeting of H Shareholders (i.e., not later than December 6, 2022 at 2:45 p.m.), or any adjourned meeting thereof (as the case may be). Completion and return of the proxy form will not preclude you from attending and voting in person at the Class Meeting of H Shareholders.

VI. CLASS MEETING OF THE DOMESTIC UNLISTED SHAREHOLDERS

The notice convening the Class Meeting of Domestic Unlisted Shareholders at the Venue on Wednesday, December 7, 2022 at 3:00 p.m. (or immediately after conclusion of the Class Meeting of H Shareholders) is set out on pages 53 to 55 in this circular.

Shareholders of Domestic Unlisted Shares whose names appear on the register of members of the Company on Wednesday, December 7, 2022 are entitled to attend and vote at the Class Meeting of Domestic Unlisted Shareholders.

The proxy form for use at the Class Meeting of Domestic Unlisted Shareholders is enclosed in this circular and published on the website of the Hong Kong Stock Exchange (www.hkexnews.hk) and the Company (www.microtechmd.com).

– 42 –

LETTER FROM THE BOARD

If you intend to attend the Class Meeting of Domestic Unlisted Shareholders by proxy, you are required to return the duly completed accompanying proxy form according to the instructions printed thereon. Shareholders who intend to attend the Class Meeting of Domestic Unlisted Shareholders by proxy are required to duly complete the proxy form and return the same to the office of the Company situated at No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China as soon as practicable but in any event not less than twenty-four (24) hours before the time appointed for holding the Class Meeting of Domestic Unlisted Shareholders (i.e., not later than December 6, 2022 at 3:00 p.m.), or any adjourned meeting thereof (as the case may be). Completion and return of the proxy form will not preclude you from attending and voting in person at the Class Meeting of Domestic Unlisted Shareholders.

VII. CLOSURE OF REGISTER OF MEMBERS

The register of members of H Shares has been scheduled to close from Friday, December 2, 2022 to Wednesday, December 7, 2022, both days inclusive, during which period no transfer of H Shares will be registered, in order to determine the holders of the H Shares who are entitled to attend and vote at the forthcoming EGM and Class Meetings to be held on Wednesday, December 7, 2022. To be eligible to attend and vote at the EGM and the Class Meetings, all transfer documents must be lodged with the Company’s H Share registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong no later than 4:30 p.m. on Thursday, December 1, 2022 for registration.

VIII. VOTING BY POLL

All resolutions to be proposed at the EGM and Class Meetings will be decided by way of poll. The Company shall publish an announcement in respect of the poll results of the EGM and the Class Meetings in the manner prescribed under Rule 13.39(5) of the Hong Kong Listing Rules.

As at the Latest Practicable Date, each of Dr. Zheng Pan, an executive Director and chairman of the Board (who held 56,200 H Shares, representing approximately 0.09% of the total relevant class of Shares and approximately 0.01% of the total issued Shares, and 88,278,594 Domestic Shares, representing approximately 30.82% of the total relevant class of Shares and approximately 20.74% of the total issued Shares), Hangzhou Yantai (which held 19,031,297 Domestic Shares, representing approximately 6.64% of the total relevant class of Shares and approximately 4.47% of the total issued Shares) and Hangzhou Hengtai (which held 15,698,265 Domestic Shares, representing approximately 5.48% of the total relevant class of Shares and approximately 3.69% of the total issued Shares) was considered to be related in the ordinary resolution to consider and approve the confirmation of the Company’s related-party transactions in the past three years (please refer to the ordinary resolution numbered 11 as set out in the notice of the EGM). Accordingly, each of Dr. Zheng Pan, Hangzhou Yantai and Hangzhou Hengtai shall abstain from voting in the relevant ordinary resolution at the EGM.

– 43 –

LETTER FROM THE BOARD

To the best of the Directors’ knowledge, information and belief, save as otherwise disclosed in this circular, no other Shareholders are required to abstain from voting at the EGM and/or the Class Meetings.

IX. RECOMMENDATION

The Directors consider that all resolutions set out in the notice of EGM and the notices of Class Meetings for consideration and approval by Shareholders are in the interests of the Company and the Shareholders as a whole. Accordingly, the Directors recommend the Shareholders to vote in favor of all resolutions to be proposed at the EGM and Class Meetings.

X. RESPONSIBILITY STATEMENT

This circular for which the Directors collectively and individually accept full responsibility, provides information in relation to the Company in compliance with the Hong Kong Listing Rules. The Directors, having made all reasonable enquiries, confirm that, to the best of their knowledge and belief, the information contained in this circular is accurate and complete in all material respects and not misleading or deceptive, and there are no other matters the omission of which would make any statement herein or this circular misleading.

XI. ADDITIONAL INFORMATION

Your attention is also drawn to the additional information set out in the appendices to this circular.

There is no assurance that the proposed A Share Offering will proceed. Shareholders and investors are advised to exercise caution in dealings in the H Shares. Further details on the proposed A Share Offering will be disclosed by the Company by way of announcement(s) in due course as and when appropriate.

Yours faithfully, By order of the Board MicroTech Medical (Hangzhou) Co., Ltd. Dr. Zheng Pan Chairman of the Board

– 44 –

APPENDIX I

PLAN FOR STABILIZING A SHARE PRICE WITHIN THREE YEARS AFTER INITIAL PUBLIC OFFERING OF A SHARES AND LISTING ON THE SCI-TECH BOARD

To maintain the stability of the A Share price after the listing of A Shares of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Issuer’’ or ‘‘Company’’), the Issuer formulates the Plan of MicroTech Medical (Hangzhou) Co., Ltd. for Stabilizing A Share Price within Three Years after the Initial Public Offering of A Shares and Listing on the Sci-Tech Board, details of which are as follows:

I. CONDITIONS FOR ACTIVATING AND CEASING SHARE PRICE STABILIZATION MEASURES

(I) Condition for activating share price stabilization measures

If, within three years from the listing date of A Shares and save for circumstances caused by force majeure, the closing price of A Shares (in case of the ex-right and exdividend events due to distribution of cash dividend, issue of bonus shares, conversion of capital reserve into share capital and additional new share offering, recovery of right is adopted according to relevant provisions of the stock exchange, the same below) remains below the unaudited net asset value per share as at the end of the prior accounting year of the Company (net asset value per share = total of equity attributable to ordinary shareholders of the Company in the consolidated financial statements ÷ total shares of the Company at the end of the year, the same below) for 20 consecutive trading days (the ‘‘Activation Condition’’), the Company and relevant parties shall activate the following share price stabilization measures according to the plan and fulfill the information disclosure obligation for the purposes of safeguarding the rights and interests of Shareholders, enhancing the confidence of investors and maintaining the stability of the share price.

(II) Conditions for ceasing share price stabilization measures

After the Activation Condition for share price stabilization measures is satisfied, if any of the following events occur, the share price stabilization measures which have been formulated or announced will be ceased, with the share price stabilization measures implemented being regarded as completed and unnecessary to be further implemented: (1) during or prior to the implementation of specific share price stabilization measures under this undertaking, the closing price of A Shares remains above the audited net asset value per share for the latest accounting period for 3 consecutive trading days; (2) further implementation of share price stabilization measures will result in a shareholding structure that does not meet the listing conditions, or will violate the then applicable prohibitive provisions, or will trigger the general offer obligation upon increasing stakes in the Company.

I – 1

APPENDIX I

PLAN FOR STABILIZING A SHARE PRICE WITHIN THREE YEARS AFTER INITIAL PUBLIC OFFERING OF A SHARES AND LISTING ON THE SCI-TECH BOARD

II. SPECIFIC MEASURES FOR STABILIZING SHARE PRICE

When the Activation Condition for share price stabilization measures is satisfied, the Company and relevant parties can implement one or more share price stabilization measures by the following order in consideration of the Company’s actual conditions and the development of the equity market: (1) the Issuer to repurchase the Shares; (2) the controlling shareholder and the de-facto controller to increase their stakes in the Company; (3) Directors (excluding independent non-executive Directors) and members of the senior management who receive remunerations from the Issuer to increase their holdings of Shares.

When formulating specific plans to maintain the stability of the share price, the Company shall consider the then actual conditions and the effect and impact of share price stabilization measures, notify the implementation party of the share price stabilization plan, which is determined through negotiation of all parties, on the condition of complying with relevant laws and regulations, and announce the specific implementation plan before activating the share price stabilization measures.

(I) The Issuer to repurchase the Shares

1. When the Activation Condition is triggered within three years from the listing date of A Shares, the repurchase of the Shares by the Issuer for the purpose of stabilizing share price shall comply with relevant laws, regulations and regulatory documents and shall not cause the shareholding structure to fail to comply with the listing conditions.

2. The Board of the Issuer shall prepare the resolution on the share repurchase plan (including the number of Shares to be repurchased, the price range, the repurchase period and other matters related to the repurchase) within 20 trading days from the date on which the share repurchase obligation is triggered initially and propose the resolution to the shareholders’ meeting for consideration. If the repurchase is implemented after being approved by the shareholders’ meeting, the Shares repurchased shall be cancelled in accordance with laws, and the Issuer shall complete the procedures for registering the capital reduction.

3. The total fund used by the Issuer to repurchase shares shall not exceed the total fund raised by the Company’s initial public offering of A shares.

4. If the A Share price does not meet the Activation Condition for share price stabilization measures, the Issuer can cease the repurchase of Shares from the public shareholders.

I – 2

APPENDIX I

PLAN FOR STABILIZING A SHARE PRICE WITHIN THREE YEARS AFTER INITIAL PUBLIC OFFERING OF A SHARES AND LISTING ON THE SCI-TECH BOARD

• (II) The controlling shareholder and the de-facto controller to increase their stakes in the Company

• For the purpose of maintaining the stability of the share price, the controlling shareholder and the de-facto controller of the Issuer shall further purchase the Shares on the condition of complying with the Measures for the Administration of the Takeover of Listed Companies and other relevant laws, regulations and regulatory documents, obtaining the approvals of regulatory authorities (if necessary) and not causing the shareholding structure of the Issuer to fail to comply with the listing conditions when any of the following conditions arises: (1) the closing price of A Shares remains below the audited net asset value per share for the latest accounting period for 20 consecutive trading days after the expiry date of the period of implementing the share repurchase plan; (2) the Company does not announce the share repurchase plan according to the schedule prescribed in the plan; (3) the share repurchase plan is not approved by the shareholders’ meeting for various reasons.

• Within 20 trading days from the date on which the share price stabilization obligation is triggered, the controlling shareholder and the de-facto controller of the Issuer shall deliver a written notice to the Company in respect of the specific plan for their further purchase of Shares (including the number of Shares to be purchased, the price range, the period of the further purchase and other matters related to the further purchase), and the Company shall make an announcement on such plan.

• Requirements for the controlling shareholder and the de-facto controller to increase their stakes: the controlling shareholder and the de-facto controller shall further purchase the Shares through call auction in the stock exchange on the condition of complying with relevant regulations on share trading and according to the amount and period of the further purchase prescribed in the specific share price stabilization plan; the total amount of Shares to be further purchased shall not be higher than 30% of cumulative cash dividends the controlling shareholder and the de-facto controller receive from the Company after the Issue and Listing. After the plan for the controlling shareholder and the de-facto controller of the Issuer to further purchase the Shares is announced, the controlling shareholder and the de-facto controller of the Issuer can cease the further purchase if the A Share price does not meet the condition for activating the share price stabilization measures. The controlling shareholder and the de-facto controller of the Issuer shall not sell the additional Shares acquired within 6 months following the completion of the plan for the further purchase of Shares.

I – 3

APPENDIX I

PLAN FOR STABILIZING A SHARE PRICE WITHIN THREE YEARS AFTER INITIAL PUBLIC OFFERING OF A SHARES AND LISTING ON THE SCI-TECH BOARD

• (III) Directors (excluding independent non-executive Directors) and members of the senior management who receive remunerations from the Issuer to increase their holdings of Shares

• For the purpose of maintaining the stability of the share price, the Directors (excluding independent non-executive Directors) and members of the senior management who receive remunerations from the Issuer shall further purchase the Shares in accordance with the Measures for the Administration of the Takeover of Listed Companies, the Rules on the Management of Shares Held by the Directors, Supervisors, and Senior Management Officers of Listed Companies and the Changes Thereof and other relevant laws and regulations when any of the following conditions arises: (1) the closing price of A Shares remains below the audited net asset value per share for the latest accounting period for 20 consecutive trading days after the expiry date of the period of implementing the plan for the controlling shareholder and the de-facto controller to further purchase the Shares; (2) the controlling shareholder and the de-facto controller do not announce the plan for the further purchase as scheduled.

• Within 20 trading days from the date on which the share price stabilization obligation is triggered, the Directors and members of the senior management of the Issuer who are obliged to further purchase the Shares shall deliver a written notice to the Company in respect of the specific plan for their further purchase of Shares (including the number of Shares to be purchased, the price range, the period of further purchase and other matters related to the further purchase), and the Company shall make an announcement on such plan.

• The Directors and members of the senior management of the Issuer who are obliged to further purchase the Shares shall further purchase the Shares through call auction in the stock exchange on the condition of complying with relevant regulations on share trading and according to the amount and period of the further purchase prescribed in the specific share price stabilization plan; the total amount of Shares to be further purchased shall not be higher than 30% of the aggregate of after-tax remunerations and after-tax cash dividends they receive from the Company during the period from the beginning of the prior year to the date on which the Board considers and approves the specific plan for share price stabilization. After the plan for such persons to further purchase the Shares is announced, such persons can cease the further purchase if the A Share price does not meet the condition for activating the share price stabilization measures. The Directors and members of senior management of the Issuer who are obliged to further purchase the Shares shall not sell the additional Shares acquired within 6 months following the completion of the plan for the further purchase of Shares.

I – 4

APPENDIX II

THREE-YEAR DIVIDEND DISTRIBUTION PLAN FOR SHAREHOLDERS AFTER THE INITIAL PUBLIC OFFERING OF A SHARES AND THE LISTING ON THE SCI-TECH BOARD

MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) intends to apply for initial public offering of A Shares and listing on the Sci-Tech Board of the Shanghai Stock Exchange (the ‘‘Issue and Listing’’). In order to further improve and standardize the Company’s dividend distribution plan, enhance the transparency and operability of the decision-making for dividend distribution and ensure shareholders’ rights of reasonable return on investment, the Company has formulated the ‘‘Three-year Dividend Distribution Plan for Shareholders after the Initial Public Offering of A Shares and the Listing on the Sci-Tech Board by MicroTech Medical (Hangzhou) Co., Ltd.’’ (the ‘‘Plan’’) in accordance with the ‘‘Notice on Further Implementing Matters Related to the Cash Dividend Distribution by Listed Companies’’, ‘‘Guideline No. 3 on the Supervision and Administration of Listed Companies – Distribution of Cash Dividends of Listed Companies’’ and other relevant laws, regulations and regulatory documents and the ‘‘Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd.’’ (the ‘‘Articles of Association’’) which is applicable after the Issue and Listing of the Company, details of which is set out below:

I. PRINCIPLE OF PROFIT DISTRIBUTION

The profit distribution policy of the Company keeps consistent and stable while taking into account the long-term interests of the Company, the overall interests of all shareholders and the sustainable development of the Company, and the Company gives priority to the distribution of profit in the form of cash dividends if appropriate.

II. METHODS OF PROFIT DISTRIBUTION

The Company distributes profits in cash, shares or a combination of cash and shares or other ways as permitted by laws and regulation. The profit distribution shall not exceed the range of cumulative distributable profits and shall not impair the Company’s ability to operate on a going concern. Under the condition that the current year is profitable and there is no major investment plan or major cash expenditure, the Company shall give priority to cash distribution of dividends.

III. CONDITIONS AND PROPORTION OF PROFIT DISTRIBUTION

1. Intervals between cash dividend distribution

The Company shall make profit distribution once a year in principle. Subject to certain conditions, the Board of Directors of the Company may propose an interim profit distribution based on the Company’s current profits size, cash flows status, stage of development and capital requirements.

II – 1

APPENDIX II

THREE-YEAR DIVIDEND DISTRIBUTION PLAN FOR SHAREHOLDERS AFTER THE INITIAL PUBLIC OFFERING OF A SHARES AND THE LISTING ON THE SCI-TECH BOARD

2. Specific conditions and proportion of cash dividend distribution

The conditions of cash dividend distribution are:

• (1) The Company’s distributable profit (i.e., the Company’s after-tax profit after making up for losses and withdrawing reserve) and the accumulated undistributed profit in a year are positive, and the cash flow is abundant. The implementation of cash dividend distribution will not affect the Company’s subsequent continuous operation;

• (2) The auditor issues a standard unqualified audit report on the Company’s financial report for the year.

• (3) The Company has no major investment plans or substantial cash expenses.

The above major investment plans or substantial cash expenses may fall within one of the following circumstances:

• (1) The cumulative expenditure of the Company’s proposed external investment, acquisition of assets or purchase of equipment over the next twelve months meets or exceeds 30% of the Company’s latest audited net assets;

• (2) The cumulative expenditure of the Company’s proposed external investment, acquisition of assets or purchase of equipment over the next twelve months meets or exceeds 10% of the Company’s latest audited total assets.

3. Differentiated cash dividend policies

The Board of Directors shall take into consideration the factors such as the characteristics of the industry in which it operates, the stage of development, the Company’s business model, the profitability, and whether there are major capital expenditure arrangements, to distinguish the following cases and propose differentiated cash dividend policies in accordance with the procedures as stipulated in the Company’s Articles of Association:

• (1) Where the Company is in a developed stage with no substantial capital expenditure arrangement, the minimum percentage of cash dividends in this profit distribution shall be 80% when profits are distributed;

• (2) Where the Company is in a developed stage with substantial capital expenditure arrangement, the minimum percentage of cash dividends in this profit distribution shall be 40% when profits are distributed;

II – 2

APPENDIX II

THREE-YEAR DIVIDEND DISTRIBUTION PLAN FOR SHAREHOLDERS AFTER THE INITIAL PUBLIC OFFERING OF A SHARES AND THE LISTING ON THE SCI-TECH BOARD

• (3) Where the Company is in a developing stage with substantial capital expenditure arrangement, the minimum percentage of cash dividends in this profit distribution shall be 20% when profits are distributed.

Where the Company’s stage of development is difficult to distinguish but there is a substantial capital expenditure arrangement, the profit distribution may be dealt with pursuant to the preceding clause. The stage at which the Company actually pays dividends shall be determined by the Board of Directors of the Company in light of the specific circumstances.

4. Specific conditions for distribution of share dividends

If the Company’s operation is in good condition, and the Board of Directors believes that the Company’s share price does not match the size of its share capital, and the distribution of share dividends is beneficial to the interests of all shareholders of the Company as a whole, the Company may propose a share dividend distribution when the above conditions regarding cash dividends are satisfied. When the Company uses share dividend for profit distribution, it shall take into account the reasonable cash dividend return to shareholders and maintain appropriate the size of share capital, and fully consider a range of true and reasonable factors including the Company’s growth and the dilution of net assets per share.

IV. DECISION-MAKING MECHANISM OF PROFIT DISTRIBUTION

1. The Board of Directors shall carefully study and justify the timing, conditions and minimum proportion, conditions for adjustment and requirements for decision-making procedures involved in formulating the Company’s distribution of cash dividends. The independent non-executive directors shall express independent opinions and may solicit opinions from minority shareholders, propose dividend distribution proposals and submit them directly to the Board of Directors for consideration.

2. The profit distribution plan shall considered and approved by the Board of Directors and the Board of Supervisors and then submitted to the shareholders’ meeting of shareholders for deliberation. Prior to considering the specific plans for distribution of cash dividends at the shareholders’ meeting, the Company shall actively communicate and discuss with shareholders, especially minority shareholders, through various channels (including but not limited to telephone, fax, email, on-site reception, etc.), fully listen to the opinions and requests from minority shareholders, and timely respond to their concerns.

3. If the Board of Directors of the Company does not make a cash profit distribution plan, or if the cash profit distribution plan made by the Board of Directors does not comply with the provisions the Articles of Association, the Company shall disclose in

II – 3

APPENDIX II

THREE-YEAR DIVIDEND DISTRIBUTION PLAN FOR SHAREHOLDERS AFTER THE INITIAL PUBLIC OFFERING OF A SHARES AND THE LISTING ON THE SCI-TECH BOARD

detail in the periodic report the reasons and the use of the funds which are not used for dividend distribution but retained by the Company. Independent non-executive directors shall express an independent opinion in this regard.

V. ADJUSTMENTS MECHANISM OF PROFIT DISTRIBUTION POLICY

In the event that force majeure such as war, natural disasters, or the new laws and regulations or regulatory documents issued by the relevant regulatory departments of the State on the profit distribution policy of listed companies, or the changes to the external operating environment (such as adjustment to the national policies, laws and regulations) have a material impact on the Company’s production and operation, or major changes in the Company’s operating situation, or from the perspective of protecting shareholders’ rights and interests or maintaining the normal and sustainable development of the Company, the Company may adjust the profit distribution policy.

The Company’s Board of Directors shall conduct a special discussion to justify the adjustment of the profit distribution policy by the Board of Directors, and provide a written report that shall be reviewed and expressed opinions by independent non-executive directors and the Board of Supervisors. When the shareholders’ meeting review the changes or adjustments of profit distribution policies, it shall facilitate the participation of small and medium-sized investors in the shareholders’ meeting through the trading system of the stock exchange or internet system, and such changes or adjustments shall be approved by more than 2/3 of the votes held by the shareholders present at the shareholders’ meeting.

VI. OTHER MATTERS

The matters not covered in the Plan shall be executed in accordance with relevant laws, regulations, regulatory documents and the Articles of Association. The Plan shall be interpreted by the Board of Directors of the Company. Upon consideration and approval at the shareholders’ meeting, the Plan shall take effect on the date of completion of the Issue and Listing of the Company.

II – 4

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

Letter of Undertakings on the Listing Application Documents of MicroTech Medical (Hangzhou) Co., Ltd. Containing no False Representation, Misleading Statements or Material Omissions

In respect of the proposal of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) for the initial public offering and listing of A Shares on the Sci-Tech Board of the Shanghai Stock Exchange (the ‘‘Offering and Listing’’), the Company hereby makes the following undertakings:

1. The Prospectus and other information disclosure materials of the Offering and Listing submitted by the Company to the Shanghai Stock Exchange (the ‘‘SSE’’) contain no false representation, misleading statements or material omissions, and the Company accepts joint and several liability for the truthfulness, accuracy, completeness and timeliness of such documents.

2. If the Prospectus and other information disclosure materials of the Offering and Listing submitted by the Company to the SSE contain false representation, misleading statement or material omission which would have a material and substantial effect on judging whether the Company satisfies the conditions of offering as prescribed by relevant laws and regulations, the Company will, after a ruling or punishment decision thereon is made by the securities regulatory authority, repurchase all the new Shares under the initial public offering in accordance with the laws. The repurchase price shall be determined on the basis of the offer price and after taking into account the relevant market factors (in case of the occurrence of any ex-right or ex-dividend event on the shares of the issuer, such as distribution of dividends, issue of bonus shares and conversion of capital reserve into share capital, the shares to be repurchased shall include all the new Shares and their underlying Shares under the Offering and Listing, and the offer price shall be adjusted for such ex-right or ex-dividend event).

3. If the Prospectus and other information disclosure materials submitted by the Company to the SSE contain false representation, misleading statement or material omission which causes losses to investors when dealing in securities, the Company will, after a ruling or punishment decision thereon is made by the securities regulatory authority in accordance with the laws, compensate the investors for their losses in accordance with the laws.

III – 1

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

Letter of Undertakings on the Repurchase of Shares in the Case of Fraudulent Offering by MicroTech Medical (Hangzhou) Co., Ltd.

In respect of the proposal of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) for the initial public offering and listing of A Shares on the Sci-Tech Board of the Shanghai Stock Exchange, the Company hereby makes the following undertakings:

1. The Company guarantees that the initial public offering and listing of A Shares on the Sci-Tech Board of the Shanghai Stock Exchange is not fraudulent.

2. In the event that the Company obtains registration of the offering by fraud, and has issued and listed the Shares when it does not satisfy the conditions of offering, the Company will initiate share repurchase procedures to repurchase all new Shares under the public offering within five business days after being confirmed by the China Securities Regulatory Commission and other competent authorities.

III – 2

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

Letter of Undertakings on the Restrictive Measures for Failure to Perform Undertakings

In respect of the proposal of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Issuer’’) for the initial public offering and listing of A Shares on the Sci-Tech Board of the Shanghai Stock Exchange (the ‘‘Offering and Listing’’), the Issuer hereby undertakes to comply with the following restrictive measures in accordance with the relevant regulatory requirements in case of failure to perform undertakings as disclosed in the Prospectus of the Offering and Listing, save for circumstances caused by force majeure, for the purpose of safeguarding the rights and interests of investors:

1. The Issuer shall fully disclose the details and reasons for the failure to perform the undertakings in a timely manner, and offer an apology to the Shareholders and the public investors;

2. The Issuer shall make rectifications within the time period required by relevant regulatory authorities, or provide legal, reasonable and effective supplemental undertakings or alternative undertakings in a timely manner;

3. If the Issuer fails to perform the relevant undertakings which causes losses to investors when dealing in securities, the Issuer shall assume the responsibility of compensating investors in accordance with the laws;

4. For Shareholders, Directors, Supervisors and members of the senior management of the Issuer who fail to perform the undertakings they have made or cause the Issuer’s failure to perform the undertakings it has made due to their own reasons, the Issuer shall immediately terminate cash dividend distribution to such persons and suspend the payment of the remunerations and allowances which they are supposed to receive from the Issuer, until such persons perform the relevant undertakings.

III – 3

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

Letter of Undertakings in Respect of the Plan of MicroTech Medical (Hangzhou) Co., Ltd. for Stabilizing Share Price

To maintain the stability of the A Share price after the listing of A Shares of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Issuer’’ or ‘‘Company’’), the Issuer formulates the Plan of MicroTech Medical (Hangzhou) Co., Ltd. for Stabilizing A Share Price within Three Years after the Initial Public Offering and Listing of A Shares on the Sci-Tech Board. The Issuer undertakes that if, within three years after the listing of A Shares (subject to the date on which the Shares are listed and traded on the Shanghai Stock Exchange), the following conditions for activating the share price stabilization measures are satisfied, it will activate the share price stabilization measures by repurchasing the Shares in accordance with the relevant procedures prescribed in the Plan of MicroTech Medical (Hangzhou) Co., Ltd. for Stabilizing A Share Price within Three Years after the Initial Public Offering and Listing of A Shares on the Sci-Tech Board.

Details of the Plan of MicroTech Medical (Hangzhou) Co., Ltd. for Stabilizing A Share Price within Three Years after the Initial Public Offering and Listing of A Shares on the Sci-Tech Board are as follows:

I. CONDITIONS FOR ACTIVATING AND CEASING SHARE PRICE STABILIZATION MEASURES

(i) Condition for activating share price stabilization measures

If, within three years from the listing date of A Shares and save for circumstances caused by force majeure, the closing price of A Shares (in case of the ex-right and ex-dividend events due to distribution of cash dividends, issue of bonus shares, conversion of capital reserve into share capital and additional new share offering, recovery of right is adopted according to relevant provisions of the stock exchange, the same below) remains below the audited net asset value per share as at the end of the prior accounting year of the Company (net asset value per share = total of equity attributable to ordinary shareholders of the Company in the consolidated financial statements ÷ total shares of the Company at the end of the year, the same below) for 20 consecutive trading days (the ‘‘Activation Condition’’), the Company and relevant parties shall active the following share price stabilization measures according to the plan and fulfill the information disclosure obligation for the purposes of safeguarding the rights and interests of Shareholders, enhancing the confidence of investors and maintaining the stability of the share price.

III – 4

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

(ii) Conditions for ceasing share price stabilization measures

After the Activation Condition for share price stabilization measures is satisfied, if any of the following events occur, the share price stabilization measures which have been formulated or announced will be ceased, with the share price stabilization measures implemented being regarded as completed and unnecessary to be further implemented: (1) during or prior to the implementation of specific share price stabilization measures under this undertaking, the closing price of A Shares remains above the audited net asset value per share for the latest accounting period for 3 consecutive trading days; (2) further implementation of share price stabilization measures will result in a shareholding structure that does not meet the listing conditions, or will violate the then applicable prohibitive provisions, or will trigger the general offer obligation upon increasing stakes in the Company.

II. SPECIFIC MEASURES FOR STABILIZING SHARE PRICE

When the Activation Condition for share price stabilization measures is satisfied, the Company and relevant parties can implement one or more share price stabilization measures by the following order in consideration of the Company’s actual conditions and the development of equity market: (1) the Issuer to repurchase the Shares; (2) the controlling shareholder and the de-facto controller to increase their stakes in the Company; (3) Directors (excluding independent non-executive Directors) and members of the senior management who receive remunerations from the Issuer to increase their holdings of Shares.

When formulating specific plans to maintain the stability of the share price, the Company shall consider the then actual conditions and the effect and impact of share price stabilization measures, notify the implementation party of the share price stabilization plan, which is determined through negotiation of all parties, on the condition of complying with relevant laws and regulations, and announce the specific implementation plan before activating the share price stabilization measures.

(i) The Issuer to repurchase the Shares

1. When the Activation Condition is triggered within three years from the listing date of A Shares, the repurchase of the Shares by the Issuer for the purpose of stabilizing share price shall comply with relevant laws, regulations and regulatory documents and shall not cause the shareholding structure to fail to comply with the listing conditions.

III – 5

APPENDIX III UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

1. The Board of the Issuer shall prepare the resolution on the share repurchase plan (including the number of Shares to be repurchased, the price range, the repurchase period and other matters related to the repurchase) within 20 trading days from the date on which the share repurchase obligation is triggered initially and propose the resolution to the shareholders’ meeting for consideration. If the repurchase is implemented after being approved by the shareholders’ meeting, the Shares repurchased shall be cancelled in accordance with laws, and the Issuer shall complete the procedures for registering the capital reduction.

2. The total fund used by the Issuer to repurchase shares shall not exceed the total fund raised by the Company’s initial public offering of A shares.

3. If the A Share price does not meet the condition for activating share price stabilization measures, the Issuer can cease the repurchase of Shares from the public shareholders.

4. (ii) The controlling shareholder and the de-facto controller to increase their stakes in the Company

5. For the purpose of maintaining the stability of the share price, the controlling shareholder and the de-facto controller of the Issuer shall further purchase the Shares on the condition of complying with the Measures for the Administration of the Takeover of Listed Companies and other relevant laws, regulations and regulatory documents, obtaining the approvals of regulatory authorities (if necessary) and not causing the shareholding structure of the Issuer to fail to comply with the listing conditions when any of the following conditions arises: (1) the closing price of A Shares remains below the audited net asset value per share for the latest accounting period for 20 consecutive trading days after the expiry date of the period of implementing the share repurchase plan; (2) the Company does not announce the share repurchase plan according to the schedule prescribed in the plan; (3) the share repurchase plan is not approved by the shareholders’ meeting for various reasons.

6. Within 20 trading days from the date on which the share price stabilization obligation is triggered, the controlling shareholder and the de-facto controller of the Issuer shall deliver a written notice to the Company in respect of the specific plan for their further purchase of Shares (including the number of Shares to be purchased, the price range, the period of the further purchase and other matters related to the further purchase), and the Company shall make an announcement on such plan.

III – 6

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

1. Requirements for the controlling shareholder and the de-facto controller to increase their stakes: the controlling shareholder and the de-facto controller shall further purchase the Shares through call auction in the stock exchange on the condition of complying with relevant regulations on share trading and according to the amount and period of the further purchase prescribed in the specific share price stabilization plan; the total amount of Shares to be further purchased shall not be higher than 30% of cumulative cash dividends the controlling shareholder and the de-facto controller receive from the Company after the Offering and Listing. After the plan for the controlling shareholder and the de-facto controller of the Issuer to further purchase the Shares is announced, the controlling shareholder and the de-facto controller of the Issuer can cease the further purchase if the A Share price does not meet the condition for activating the share price stabilization measures. The controlling shareholder and the de-facto controller of the Issuer shall not sell the additional Shares acquired within 6 months following the completion of the plan for the further purchase of Shares.

2. (iii) Directors (excluding independent non-executive Directors) and members of the senior management who receive remunerations from the Issuer to increase their holdings of Shares

3. For the purpose of maintaining the stability of the share price, the Directors (excluding independent non-executive Directors) and members of the senior management who receive remunerations from the Issuer shall further purchase the Shares in accordance with the Measures for the Administration of the Takeover of Listed Companies, the Rules on the Management of Shares Held by the Directors, Supervisors, and Senior Management Officers of Listed Companies and the Changes Thereof and other relevant laws and regulations when any of the following conditions arises: (1) the closing price of A Shares remains below the audited net asset value per share for the latest accounting period for 20 consecutive trading days after the expiry date of the period of implementing the plan for the controlling shareholder and the de-facto controller to further purchase the Shares; (2) the controlling shareholder and the de-facto controller do not announce the plan for the further purchase as scheduled.

4. Within 20 trading days from the date on which the share price stabilization obligation is triggered, the Directors and members of the senior management of the Issuer who are obliged to further purchase the Shares shall deliver a written notice to the Company in respect of the specific plan for their further purchase of Shares (including the number of Shares to be purchased, the price range, the period of the further purchase and other matters related to the further purchase), and the Company shall make an announcement on such plan.

III – 7

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

1. The Directors and members of the senior management of the Issuer who are obliged to further purchase the Shares shall further purchase the Shares through call auction in the stock exchange on the condition of complying with relevant regulations on share trading and according to the amount and period of the further purchase prescribed in the specific share price stabilization plan; the total amount of Shares to be further purchased shall not be higher than 30% of the aggregate of after-tax remunerations and after-tax cash dividends they receive from the Company during the period from the beginning of the prior year to the date on which the Board considers and approves the specific plan for share price stabilization. After the plan for such persons to further purchase the Shares is announced, such persons can cease the further purchase if the A Share price does not meet the condition for activating the share price stabilization measures. The Directors and members of senior management of the Issuer who are obliged to further purchase the Shares shall not sell the additional Shares acquired within 6 months following the completion of the plan for the further purchase of Shares.

III – 8

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

Letter of Undertaking on the Adoption of Remedial Measures in Relation to Dilution on Current Returns by the Initial Public Offering and Listing of A Shares of MicroTech Medical (Hangzhou) Co., Ltd.

MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) proposes to apply for the initial public offering and listing of A Shares on the Sci-Tech Board of the Shanghai Stock Exchange (the ‘‘Offering and Listing’’). In respect of the remedial measures in relation to dilution on the Company’s current returns by the Offering and Listing, the Company hereby solemnly undertakes as follows:

The current returns to investors may be diluted following the completion of the Offering and Listing. For the purposes of ensuring effective use of proceeds from the Offering, preventing the risk of dilution on current returns to the Shareholders and enhance the Company’s ability to generate sustainable returns in the future, the Company proposes to adopt the following specific measures:

1. Strengthening the principal businesses and improving the sustainable profitability

The proceeds from the Offering will be used to develop the Company’s principal businesses and ensure sustainable and steady growth of such principal businesses. As the financial strength of the Company will be further enhanced after the Offering and Listing, the Company will vigorously promote research and development, consolidate and expand its principal businesses, so as to improve the comprehensive competitiveness and profitability and reduce the risk of dilution on current returns to Shareholders resulting from the Offering and Listing.

2. Improving operational efficiency and reducing operating costs

The Company will improve asset operation efficiency and working capital turnover efficiency, and strengthen budget management and accounts receivable management. In addition, the Company will improve the remuneration and incentive mechanism to motivate employees and maximize their creativity and potential, and therefore to improve operational efficiency within the organization and reduce costs.

III – 9

APPENDIX III UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

1. Strengthening proceeds management and actively promoting investment projects financed by the proceeds to achieve expected investment returns as soon as practicable

After the proceeds are in place, the Company will promote the investment projects financed by the proceeds in an orderly manner, so as to enable these projects to reach full capacity as soon as practicable and to achieve expected benefits. In addition, the Company will strictly manage the use of proceeds in accordance with relevant laws and regulations and its internal Management System for A Share Raised Proceeds, ensure that the proceeds would be used effectively according to the original plans, help investment projects financed by the proceeds to reach full capacity as soon as practicable and achieve expected benefits, thereby bringing more returns to the Shareholders and reducing the risk of dilution on current returns to Shareholders resulting from the Offering and Listing.

1. Strictly implementing the dividend distribution policy to guarantee returns to the Shareholders

In accordance with the Notice Regarding Further Implementation of Cash Dividends Distribution by Listed Companies and the Regulatory Guidelines No. 3 for Listed Companies – Cash Dividends Distribution of Listed Companies issued by the China Securities Regulatory Commission, the Company has further improved and refined the profit distribution policy and developed the dividend distribution plans, and will strictly implement the said dividend distribution policies to return benefits to investors.

III – 10

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

Letter of Undertakings on the Disclosure of Shareholders’ Information of MicroTech Medical (Hangzhou) Co., Ltd.

In respect of the proposal of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) for initial public offering and listing of A Shares on the Sci-Tech Board of the Shanghai Stock Exchange (the ‘‘Offering and Listing’’), the Company hereby makes the following undertakings:

1. In the history of the Company, no person holds the Company’s equity interests as a custodian or under entrustment, and there is no dispute or potential dispute in relation to the Company’s equity interests;

2. None of the shareholders of the Company is prohibited from directly or indirectly holding shares in the Company pursuant to relevant laws and regulations;

3. China International Capital Corporation Limited (‘‘CICC’’), the sponsor and underwriter of the Offering and Listing, indirectly holds 0.4214% of all issued shares of the Company through its wholly-owned subsidiary, CICC Pucheng Investment Co., Ltd.. CICC Capital Management Co., Ltd. (‘‘CICC Capital’’), a wholly-owned subsidiary of CICC, holds 1.9403% in the shares of capital contribution in CICC Qiyuan National Emerging Fund (‘‘CICC Qiyuan’’) and acts as the general partner of CICC Qiyuan (Note). CICC Qiyuan holds 19.9601% in the shares of capital contribution in Suzhou Chenzhide Investment (Limited Partnership), a shareholder of the Company, and accordingly, CICC ultimately and indirectly holds 0.0016% of all issued shares of the Company. Certain entities of CICC also indirectly hold shares of the Company by virtue of their indirect holding of an insignificant number of shares of the Company, on a see-through basis, through Jiangsu Jiequan Lize Health Industry Venture Capital Fund (Limited Partnership) (being a shareholder of the Company), the proportion of which is extremely low (not exceeding 0.00001% in aggregate). Save for the aforesaid, none of the intermediaries for the Offering and Listing and their respective responsible officer, senior executives and persons-in-charge directly or indirectly holds any shares of the Company;

Note: The former general partner of CICC Qiyuan was CICC Jiacheng Investment Management Co., Ltd., which was de-registered on December 20, 2021 with all of its rights and obligations assumed by CICC Capital, save that the formal industrial and commercial registration of change have yet been completed.

III – 11

APPENDIX III UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

1. None of the shareholders of the Company is involved in the improper transfer of benefits by using the equity interests of the Company;

2. The Company and its Shareholders have performed the information disclosure obligation by providing intermediaries of the Offering and Listing with true, accurate and complete information in a timely manner, actively and comprehensively cooperating with intermediaries of the Offering and Listing to conduct due diligence, and truly, accurately and completely disclosing Shareholders’ information in the application documents of the Offering and Listing in accordance with the laws.

III – 12

APPENDIX III

UNDERTAKINGS AND RESTRAINING MEASURES RELATING TO THE A SHARE OFFERING

Letter of Commitment on Profit Distribution Policy of Microtech Medical (Hangzhou) Co., Ltd.

Whereas MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) intends to apply for an initial public offering of A Shares and listing on the Sci-Tech Board of the Shanghai Stock Exchange (the ‘‘offering and Listing’’), to fully safeguard the legitimate rights and interests of the Company’s Shareholders, provide stable and continuous investment returns to Shareholders and maximize investment income of Shareholders, the Company has made the following commitments:

1. Following the Issue and Listing, the Company will distribute profits to Shareholders in strict accordance with the Articles of Association applicable after the Issue and Listing, the Prospectus for the Issue and Listing and profit distribution policy disclosed in the plan of the Company for dividend distribution to Shareholders in three years after the Issue and Listing, and will strictly fulfill the procedures for consideration of the profit distribution plan.

2. In case of any violation of the aforementioned commitments, causing losses to investors, the Company shall be liable to investors in accordance with the law.

III – 13

APPENDIX IV-A

PROPOSED AMENDMENTS TO THE CURRENT ARTICLES OF ASSOCIATION

COMPARISON TABLE OF AMENDMENTS TO

THE ARTICLES OF ASSOCIATION OF MICROTECH MEDICAL (DRAFT)

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 51	Article 51	The holders of ordinary shares of the Company shall be entitled to the following rights: (I) to receive dividends and other kinds of benefit distributions based on the number of shares held by them; (II) to require, convene, chair, attend or appoint a proxy to attend a shareholders’ general meeting pursuant to the law and exercise the corresponding voting rights; (III) to supervise and manage the business operations of the Company, and to put forward suggestions and raise enquiries; (IV) to transfer, bestow or pledge shares held by them in accordance with the laws, administrative regulations and the Articles of Association; (V) to obtain related information in accordance with provisions of the Articles of Association, including: 1. obtaining the copies of the Article of Association after paying relevant costs; 2. reviewing and copying the following documents after paying reasonable costs: (1) copies of the register of members; (2) personal information of the directors, supervisors, general manager and other senior management personnel of the Company, including: a) current and previous names and aliases; b) principal address (domicile); c) nationality; d) full-time and all other part-time occupations and titles; e) identification document and its number;	The holders of ordinary shares of the Company shall be entitled to the following rights: (I) to receive dividends and other kinds of benefit distributions based on the number of shares held by them; (II) to require, convene, chair, attend or appoint a proxy to attend a shareholders’ general meeting pursuant to the law and exercise the corresponding speaking rights and voting rights; (III) to supervise and manage the business operations of the Company, and to put forward suggestions and raise enquiries; (IV) to transfer, bestow or pledge shares held by them in accordance with the laws, administrative regulations and the Articles of Association; (V) to obtain related information in accordance with provisions of the Articles of Association, including: 1. obtaining the copies of the Article of Association after paying relevant costs; 2. reviewing and copying the following documents after paying reasonable costs: (1) copies of the register of members; (2) personal information of the directors, supervisors, general manager and other senior management personnel of the Company, including: a) current and previous names and aliases; b) principal address (domicile); c) nationality; d) full-time and all other part-time occupations and titles; e) identification document and its number;

IV-A – 1

APPENDIX IV-A

PROPOSED AMENDMENTS TO THE CURRENT ARTICLES OF ASSOCIATION

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
		(3) a report showing the state of the issued share capital of the Company; (4) reports showing the total par value, quantity, maximum and minimum prices paid for each class of shares repurchased by the Company since the end of the last fiscal year and the all the expenses paid by the Company for this purpose (subdivided by Domestic Shares and foreign shares (and H shares, if applicable)); (5) minutes of the shareholders’ general meetings (only for Shareholders to inspect) and copies of special resolutions of the Company, copies of resolutions of meetings of the Board and the Supervisory Committee; (6) the latest audited financial statements of the Company, and the reports of the Board, the accounting firm and the Supervisory Committee; and (7) a copy of the latest annual inspection report already submitted to the Administration for Industry and Commerce or other competent authorities of PRC for filing; The Company shall place documents referred to in the above sub-paragraphs (1) to (7) (other than sub-paragraph (2)) and any other applicable documents at the Company’s Hong Kong address according to Hong Kong Listing Rules for public and Shareholders to inspect free of charge (except for minutes of shareholders’ general meetings which are only for shareholders to inspect). The shareholders of the Company may also inspect the resolutions of meetings of the Board and the Supervisory Committee. If any shareholder requests to inspect the aforesaid relevant information or asks for relevant data, the said shareholder shall provide the Company with written documents evidencing the class and number of shares that he/she/it held in the Company, and the Company will provide the said information or data as required by the said shareholder upon authenticating his/her/its identity. (VI) upon termination or liquidation of the Company, participating in the distribution of the Company’s residual assets based on their shareholding; (VII) a shareholder who objects to the resolution on merger or division of the Company passed by a shareholders’ general meeting may request the Company to acquire his/her/its shares; and (VIII) any other rights stipulated by laws, administrative regulations, departmental rules, listing rules of the place where the securities of the Company are listed and the Articles of Association.	(3) a report showing the state of the issued share capital of the Company; (4) reports showing the total par value, quantity, maximum and minimum prices paid for each class of shares repurchased by the Company since the end of the last fiscal year and the all the expenses paid by the Company for this purpose (subdivided by Domestic Shares and foreign shares (and H shares, if applicable)); (5) minutes of the shareholders’ general meetings (only for Shareholders to inspect) and copies of special resolutions of the Company, copies of resolutions of meetings of the Board and the Supervisory Committee; (6) the latest audited financial statements of the Company, and the reports of the Board, the accounting firm and the Supervisory Committee; and (7) a copy of the latest annual inspection report already submitted to the Administration for Industry and Commerce or other competent authorities of PRC for filing; The Company shall place documents referred to in the above sub-paragraphs (1) to (7) (other than sub-paragraph (2)) and any other applicable documents at the Company’s Hong Kong address according to Hong Kong Listing Rules for public and Shareholders to inspect free of charge (except for minutes of shareholders’ general meetings which are only for shareholders to inspect). The shareholders of the Company may also inspect the resolutions of meetings of the Board and the Supervisory Committee. If any shareholder requests to inspect the aforesaid relevant information or asks for relevant data, the said shareholder shall provide the Company with written documents evidencing the class and number of shares that he/she/it held in the Company, and the Company will provide the said information or data as required by the said shareholder upon authenticating his/her/its identity. (VI) upon termination or liquidation of the Company, participating in the distribution of the Company’s residual assets based on their shareholding; (VII) a shareholder who objects to the resolution on merger or division of the Company passed by a shareholders’ general meeting may request the Company to acquire his/her/its shares; and (VIII) any other rights stipulated by laws, administrative regulations, departmental rules, listing rules of the place where the securities of the Company are listed and the Articles of Association.

IV-A – 2

APPENDIX IV-A

PROPOSED AMENDMENTS TO THE CURRENT ARTICLES OF ASSOCIATION

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 113	Article 113	Directors shall be elected at the shareholders’ general meetings for a term of 3 years. Upon maturity of the term of office, a director shall be eligible to offer himself for re- election and re-appointment. Written notice of the intention to nominate a candidate for directorship and the candidate’s indication of his or her willingness to accept the nomination shall be sent to the Company seven days prior to the shareholders’ general meeting. The election and removal of the chairman shall be approved by more than half of all directors. The chairman shall serve for a term of three years and may be re-elected. Any person appointed by the Board of Directors as director to fill a casual vacancy on or as an addition to the Board of Directors shall hold office only until the first annual general meeting of the issuer after his/her appointment, and shall then be eligible for re-election. Subject to the relevant laws and administrative regulations, a director (including an executive director) may be removed by an ordinary resolution in a shareholders’ general meeting, before the expiration of his term of office; but such removal shall not have prejudice to any damage claim made by that director under any contract. A director is not required to hold any shares of the Company.	Directors shall be elected at the shareholders’ general meetings for a term of 3 years. Upon maturity of the term of office, a director shall be eligible to offer himself for re- election and re-appointment. Written notice of the intention to nominate a candidate for directorship and the candidate’s indication of his or her willingness to accept the nomination shall be sent to the Company seven days prior to the shareholders’ general meeting. The election and removal of the chairman shall be approved by more than half of all directors. The chairman shall serve for a term of three years and may be re-elected.
			~~Any person appointed by the Board of Directors as director to~~
			~~fill a casual vacancy on or as an addition to the Board of~~
			~~Directors shall hold office only until the first annual general~~
			~~meeting of the issuer after his/her appointment, and shall then~~ ~~be eligible for re-election.~~ Subject to the relevant laws and administrative regulations, a director (including an executive director) may be removed by an ordinary resolution in a shareholders’ general meeting, before the expiration of his term of office; but such removal shall not have prejudice to any damage claim made by that director under any contract. A director is not required to hold any shares of the Company.

IV-A – 3

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

COMPARISON TABLE OF AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF

MICROTECH MEDICAL (DRAFT)

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 1	Article 1	To safeguard the legitimate rights and interests of MicroTech Medical (Hangzhou) Co., Ltd. (hereinafter referred to as the “Company”), its shareholders and creditors and regulate the organization and acts of the Company, the Articles of Association are formulated by the Company in accordance with the Company Law of the People’s Republic of China（中 華人民共和國公司法）(hereinafter referred to as the “Company Law”), the Securities Law of the People’s Republic of China, the Special Regulations of the State Council on the Overseas Offering and Listing of Shares by Joint Stock Limited Companies（國務院關於股份有限公司境外募集股份及 上市的特別規定）(hereinafter referred to as the “Special Regulations”), the Mandatory Provisions for Articles of Association of Companies to be Listed Overseas（到境外上市 公司章程必備條款）(hereinafter referred to as the “Mandatory Provisions”), the Letter of the Opinion on the Supplemental Amendments to the Articles of Association of Companies to be Listed in Hong Kong（關於到香港上市公司對公司章程作補 充修改的意見的函）, the Reply of the State Council on the Adjustment of the Notice Period of the General Meeting and Other Matters Applicable to the Overseas Listed Companies （國務院關於調整適用在境外上市公司召開股東大會通知期限 等事項規定的批覆）, the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (hereinafter referred to as the “Hong Kong Listing Rules”), and other relevant provisions.	To safeguard the legitimate rights and interests of MicroTech Medical (Hangzhou) Co., Ltd. (hereinafter referred to as the “Company”), its shareholders and creditors and regulate the organization and acts of the Company, the Articles of Association are formulated by the Company in accordance with the Company Law of the People’s Republic of China（中 華人民共和國公司法）(hereinafter referred to as the “Company Law”), the Securities Law of the People’s Republic of China (hereinafter referred to as the “Securities Law”), the Special Regulations of the State Council on the Overseas Offering and Listing of Shares by Joint Stock Limited Companies（國務院關於股份有限公司境外募集股份及上市的 特別規定）(hereinafter referred to as the “Special Regulations”), the Mandatory Provisions for Articles of Association of Companies to be Listed Overseas（到境外上市 公司章程必備條款）(hereinafter referred to as the “Mandatory Provisions”), the Letter of the Opinion on the Supplemental Amendments to the Articles of Association of Companies to be Listed in Hong Kong（關於到香港上市公司對公司章程作補 充修改的意見的函）, the Reply of the State Council on the Adjustment of the Notice Period of the General Meeting and Other Matters Applicable to the Overseas Listed Companies （國務院關於調整適用在境外上市公司召開股東大會通知期限 等事項規定的批覆）, the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (hereinafter referred to as the “Hong Kong Listing Rules”), the Guidance for the Articles of Association of Listed Companies（上市公司章程指引）, the Rules Governing the Listing of Stocks on the STAR Market of Shanghai Stock Exchange（上海證券交易所科創板股票上市規則）and other relevant provisions.

IV-B – 1

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 2	As approved by the China Securities Regulatory Commission on July 28, 2021, the Company issued 63,529,500 overseas listed foreign shares, H Shares were listed on The Stock Exchange of Hong Kong Limited (hereinafter referred to as the “Hong Kong Stock Exchange” or “Stock Exchange”) on October 19, 2021.	As approved by the China Securities Regulatory Commission (hereinafter referred to as the “CSRC”) on July 28, 2021, the Company issued 63,529,500 overseas listed foreign shares, H Shares were listed on The Stock Exchange of Hong Kong Limited (hereinafter referred to as the “Hong Kong Stock Exchange” or “Stock Exchange”) on October 19, 2021. As approved by the CSRC on [•], the Company issued [•] A Shares through the initial public offering, which were listed on the STAR Market of the Shanghai Stock Exchange (hereinafter referred to as the “SSE”) on [•].
				were listed
				Exchange
	Article 5	The registered capital of the Company is RMB425,742,600.	The registered capital of the Company is Renminbi (hereinafter referred to as the “RMB”, the legal currency of the PRC) ~~425,742,600~~[•].	Renminbi
Article 9	Article 9	The Articles of Association have been considered and approved at the general meeting of the Company and shall become effective from the date on which the overseas listed foreign shares (H Shares) issued by the Company are listed on the Hong Kong Stock Exchange. The original Articles of Association of the Company shall be invalidated automatically from the effective date of the Articles of Association.	The Articles of Association have been considered and approved at the general meeting of the Company and shall become effective from the date on which the ~~overseas listed~~ ~~foreign shares (H~~A Shares~~) ~~issued by the Company are listed on the STAR Market of the SSE~~Hong Kong Stock Exchange~~. The original Articles of Association of the Company shall be invalidated automatically from the effective date of the Articles of Association.

IV-B – 2

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 18	Article 18	Shares that the Company issues to domestic investors for subscription in Renminbi shall be referred to as domestic shares. Shares that the Company issues to foreign investors for subscription in foreign currencies shall be referred to as foreign shares. Foreign shares that are listed overseas shall be referred to as overseas listed foreign shares. Foreign currencies referred to in the preceding paragraph mean the lawful currencies (other than Renminbi) of other countries or regions that are recognized by the foreign exchange authority of the PRC and that can be used to pay the share price to the Company. Foreign shares issued by the Company that are listed in Hong Kong shall be referred to as H shares. H shares are shares that have been approved for listing on the Hong Kong Stock Exchange, the par value of which are denominated in Renminbi and which are subscribed for and traded in foreign currencies. Both holders of domestic shares and holders of foreign shares are holders of ordinary shares, and have and bear the same rights and obligations. Subject to the approval of the securities regulatory authorities of the State Council, shareholders of the Company may transfer all or part of the unlisted shares they hold to foreign investors and list and trade the unlisted shares on an overseas stock exchange, and may also convert all or part of the unlisted shares they hold into overseas listed shares and arrange for the listing and trading of these shares on an overseas stock exchange. Listing and trading of the aforesaid transferred or converted shares on an overseas stock exchange shall also comply with the regulatory procedures, regulations and requirements of the overseas securities market. No approval of a shareholders’ general meeting or meeting of class shareholders is required for the listing and trading of such transferred shares on overseas stock exchange, or all or part of the unlisted shares held by the shareholders of the Company being converted into overseas listed shares and listed and traded on the overseas stock exchange. The Company’s unlisted shares, upon being listed and traded on the overseas stock exchange, shall belong to the same class of shares as the original overseas listed shares. Ordinary shareholders of domestic shares and foreign shares of the Company shall have the same rights in any distribution made by dividends or other forms.	Shares that the Company issues to domestic investors for subscription in Renminbi shall be referred to as domestic shares. Shares that the Company issues to foreign investors for subscription in foreign currencies shall be referred to as foreign shares. Foreign shares that are listed overseas shall be referred to as overseas listed foreign shares. Foreign shares and domestic shares that are listed in the domestic market
				domestic market
			shall be collectively referred to as domestically listed shares. Foreign currencies referred to in the preceding paragraph mean the lawful currencies (other than Renminbi) of other countries or regions that are recognized by the foreign exchange authority of the PRC and that can be used to pay the share price to the Company. Foreign shares issued by the Company that are listed in Hong Kong shall be referred to as H shares. H shares are shares that have been approved for listing on the Hong Kong Stock Exchange, the par value of which are denominated in Renminbi and which are subscribed for and traded in foreign currencies. The shares issued by the Company that are listed in the domestic market shall be referred to as A Shares. A
			Shares are shares that have been approved for listing on the
			SSE, the par value of which are denominated in RMB and
			which are subscribed for and traded in RMB. Both holders of domestic shares and holders of foreign shares are holders of ordinary shares, and have and bear the same rights and obligations.
			~~Subject to the approval of the securities regulatory authorities~~
			~~of the State Council, shareholders of the Company may~~
			~~transfer all or part of the unlisted shares they hold to foreign~~
			~~investors and list and trade the unlisted shares on an overseas~~
			~~stock exchange, and may also convert all or part of the~~
			~~unlisted shares they hold into overseas listed shares and~~
			~~arrange for the listing and trading of these shares on an~~
			~~overseas stock exchange. Listing and trading of the aforesaid~~
			~~transferred or converted shares on an overseas stock exchange~~
			~~shall also comply with the regulatory procedures, regulations~~
			~~and~~ ~~requirements~~ ~~of~~ ~~the~~ ~~overseas~~ ~~securities~~ ~~market.~~ ~~No~~ ~~’~~
			~~approval of a shareholders general meeting or meeting of~~
			~~class shareholders is required for the listing and trading of~~
			~~such transferred shares on overseas stock exchange, or all or~~
			~~part of the unlisted shares held by the shareholders of the~~
			~~Company being converted into overseas listed shares and~~
			~~listed~~ ~~and~~ ~~traded~~ ~~on~~ ~~the~~ ~~overseas~~ ~~stock~~ ~~exchange.~~ ~~The~~ ~~’~~
			~~Companys unlisted shares, upon being listed and traded on~~
			~~the overseas stock exchange, shall belong to the same class of~~ ~~shares as the original overseas listed shares.~~ Ordinary shareholders of domestic shares and foreign shares of the Company shall have the same rights in any distribution made by dividends or other forms.

IV-B – 3

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No. Before Amendment After Amendment (Revision) Article 19 Article 19 Subject to the approval of the company approving Article 19 Subject to the approval of the company approving department authorized by the State Council, the total number department authorized by the State Council, the total number of ordinary shares issued by the Company was 360,000,000 of ordinary shares issued by the Company was 360,000,000 shares. The total number of ordinary shares issued by the shares. The total number of ordinary shares issued by the Company upon incorporation was 83,022,715 shares, all of Company upon incorporation was 83,022,715 shares, all of which were subscribed for by promoters upon the which were subscribed for by promoters upon the establishment of the Company. The total number of ordinary establishment of the Company. The total number of ordinary shares of the Company after the additional issuance in shares of the Company after the additional issuance in November 2020 was 95,195,805 shares. The total number of November 2020 was 95,195,805 shares. The total number of ordinary shares of the Company after the conversion of capital ordinary shares of the Company after the conversion of capital reserve to share capital in December 2020 was 360,000,000 reserve to share capital in December 2020 was 360,000,000 shares. shares. Upon completion of the initial public offering of overseas Upon completion of the initial public offering of overseas listed foreign shares (H Shares) and the over-allotment, the listed foreign shares (H Shares) and the over-allotment, the share capital of the Company is 425,742,600 shares, th ~~e~~ share capital of the Company is 425,742,600 shares, th e capital structure shall comprise of: 286,473,574 domestic capital structure shall comprise of: 286,473,574 domestic shares, 73,526,426 non-overseas listed foreign shares and shares, 73,526,426 non-overseas listed foreign shares and 65,742,600 overseas listed foreign shares. 65,742,600 overseas listed foreign shares. As approved by the CSRC, 18 shareholders of the Company have converted a total of 104,580,329 unlisted shares into H Shares, which can be listed on the Stock Exchange after the completion of conversion. Article 20 Article 20 With the approval of the SSE and the CSRC for registration, the Company has made an initial public offering of [•] A Shares, which are listed on the STAR Market of the SSE on [•]. Upon completion of the initial public offering of A Shares and the listing on the STAR Market of the SSE, the capital structure of the Company shall comprise of: [•] A Shares, representing [•]% of the total number of shares of the Company and [•] H Shares, representing [•]% of the total number of shares of the Company.

IV-B – 4

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 23	Article 23 The Company may approve capital increase based on the needs of operation and development and in accordance with the Articles of Association. The Company may increase its registered capital by the following methods: (I) public offering of shares; (II) private offering of shares; (III) placement or distribution of new shares to the existing shareholders; (IV) converting funds in the capital reserve into share capital; (V) any other method stipulated by laws and administrative regulations and approved by relevant regulatory authorities. The Company’s increase of capital by issuing new shares shall be conducted in accordance with the procedures provided in the relevant laws and administrative regulations of the state, after being approved according to the Articles of Association.	Article 23 The Company may approve capital increase based on the needs of operation and development and in accordance with the Articles of Association. The Company may increase its registered capital by the following methods: (I) public offering of shares; (II) private offering of shares; (III) placement or distribution of new shares to the existing shareholders; (IV) converting funds in the capital reserve into share capital; (V) any other method stipulated by laws and administrative regulations and approved by relevant regulatory authorities. The Company’s increase of capital by issuing new shares shall be conducted in accordance with the procedures provided in the relevant laws and administrative regulations of the state, after being approved according to the Articles of Association. The Company is prohibited from issuing preference shares which are convertible into ordinary shares.
	Article 27	Article 27 The Company may repurchase its shares by any of the following methods: (I) issuance to all the shareholders of a buyback offer on a pro rata basis; (II) buyback through open transaction on a stock exchange; (III) buyback by agreement outside a stock exchange; or (IV) by other means as permitted by the laws, administrative regulations, listing rules of the place where the securities of the Company are listed and the relevant competent authorities.	Article 27 The Company may repurchase its shares by any of the following methods: (I) issuance to all the shareholders of a buyback offer on a pro rata basis; (II) buyback through open transaction on a stock exchange; (III) buyback by agreement outside a stock exchange; or (IV) by other means as permitted by the laws, administrative regulations, listing rules of the place where the securities of the Company are listed and the relevant competent authorities. Where the Company acquires its own shares under circumstances as mentioned in Article 26 (III), (V) and (VI) of the Articles of Association, it shall be conducted through open and centralized transactions.

IV-B – 5

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 35		Article 35 The shares of the Company held by the promoters
			shall not be transferred within one year from the date of
			establishment of the Company. The shares issued before the
			initial public offering of the Company, shall not be transferred
			within one year from the date when the shares of the
			Company are listed and traded on a stock exchange. The Directors, supervisors and senior management of the
			Company shall report to the Company the shares of the
			Company held by them and the changes thereof. During the
			term of their office, the shares transferred by any of them
			each year shall not exceed 25% of the total number of shares
			of the same class of the Company that he/she holds. The
			shares of the Company held by the aforesaid persons shall not
			be transferred within one year from the date when the shares
			of the Company are listed and traded. If any of the aforesaid
			persons leaves from his/her post, he/she shall not transfer the
			shares of the Company that he/she holds within six months
			from such departure.
Article 36			Article 36 If any shareholder holding more than 5% of the
			shares of the Company, Director, supervisor or senior
			management of the Company sells the shares of the Company
			or other securities of equity nature within six months after
			buying those, or buys within six months after selling those,
			all the gains arising there from shall belong to the Company. Such gains will be collected by the Board of Directors of the
			Company. However, if a securities company holds more than
			5% of the shares of the Company as a result of purchasing
			the remaining shares after underwriting, and other
			circumstances as stipulated by CSRC are exempted from such
			requirements. The shares or other securities of equity nature held by the
			Directors, supervisors, senior management or natural person
			shareholders referred to in the preceding paragraph shall
			include shares or other securities of equity nature held by
			their spouses, parents and children, and held by using another
			person’s account. If the Board of Directors of the Company fails to comply with
			the first paragraph of this Article, the shareholders shall have
			the right to request the Board of Directors to do so within 30
			days. If the Board of Directors fails to enforce such right
			within the said period, the shareholders shall have the right to
			file a lawsuit in their own names directly to the People’s
			Court for the interest of the Company. If the Board of Directors of the Company fails to act in
			accordance with the first paragraph of this Article, the
			responsible Directors shall be jointly liable in accordance with

IV-B – 6

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 37	Article 35 The Company or its subsidiaries shall not, by any means at any time, provide any kind of financial assistance to a person who acquires or is proposing to acquire shares of the Company. The aforesaid person acquiring shares of the Company includes a person who has directly or indirectly incurred any obligations as a result of the acquisition of shares of the Company. The Company or its subsidiaries shall not, by any means at any time, provide financial assistance to the aforesaid person for the purpose of reducing or discharging his obligations. This Article shall not apply to the circumstances specified in Article 37 in this Chapter.	Article ~~35 3~~7 The Company or its subsidiaries shall not, by any means at any time, provide any kind of financial assistance to a person who acquires or is proposing to acquire shares of the Company. The aforesaid person acquiring shares of the Company includes a person who has directly or indirectly incurred any obligations as a result of the acquisition of shares of the Company. The Company or its subsidiaries shall not, by any means at any time, provide financial assistance to the aforesaid person for the purpose of reducing or discharging his obligations. This Article shall not apply to the circumstances specified in Article ~~37 3~~9 in this Chapter.
Article 39	Article 39	Article 36 The following activities shall not be deemed to be activities as prohibited in Article 35 of this Chapter: (I) The provision of financial assistance by the Company where the financial assistance is given in good faith in the interests of the Company, and the principal purpose of which is not for the acquisition of shares of the Company, or the giving of financial assistance is an incidental part of the overall plan of the Company; (II) The lawful distribution of the Company’s assets as dividends; (III) The allotment of bonus shares as dividends; (IV) The reduction of registered capital, repurchase of shares or reorganization of share capital structure of the Company effected in accordance with the Articles of Association; (V) The lending of money by the Company for normal business activities within its scope of business, provided that the net assets of the Company are not thereby reduced or, to the extent that the assets are thereby reduced, the financial assistance is provided from the distributable profits of the Company; and (VI) The contributions made by the Company to the employee share ownership schemes, provided that the net assets of the Company are not thereby reduced or, to the extent that the assets are thereby reduced, the financial assistance is provided from the distributable profits of the Company.	Article ~~36 3~~9 The following activities shall not be deemed to be activities as prohibited in Article ~~35 ~~37 of this Chapter: (I) The provision of financial assistance by the Company where the financial assistance is given in good faith in the interests of the Company, and the principal purpose of which is not for the acquisition of shares of the Company, or the giving of financial assistance is an incidental part of the overall plan of the Company; (II) The lawful distribution of the Company’s assets as dividends; (III) The allotment of bonus shares as dividends; (IV) The reduction of registered capital, repurchase of shares or reorganization of share capital structure of the Company effected in accordance with the Articles of Association; (V) The lending of money by the Company for normal business activities within its scope of business, provided that the net assets of the Company are not thereby reduced or, to the extent that the assets are thereby reduced, the financial assistance is provided from the distributable profits of the Company; and (VI) The contributions made by the Company to the employee share ownership schemes, provided that the net assets of the Company are not thereby reduced or, to the extent that the assets are thereby reduced, the financial assistance is provided from the distributable profits of the Company.

IV-B – 7

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 40	Article 40	Article 38 Share certificates of the Company shall be in registered form. Matters to be specified in the Company’s shares shall include: (I) name of the Company; (II) date of incorporation of the Company; (III) category of share, par value and number of shares represented; (IV) share certificate number; and (V) other particulars that are required to be specified by the Company Law, the Special Provisions and the stock exchange where the securities of the Company are listed. The Company may issue overseas listed foreign shares in the form of foreign depository receipts or other derivatives of shares in accordance with the laws of the place where the Securities of the Company are listed and the practice of securities registration and deposit. During the time the Company’s H shares remain listed on the Hong Kong Stock Exchange, the Company shall ensure that all listing documents and ownership documents (including H share certificates) relating to its securities listed on Hong Kong Stock Exchange include the statements stipulated below, and shall instruct and procure its share registrar not to register the subscription, purchase or transfer of any of its shares in the name of any particular holder unless and until such individual holder submits to the share registrar a signed form in respect to such shares which bear statements to the following effect: (I) The acquirer of the shares agrees with the Company and each shareholder of the Company, and the Company agrees with each shareholder, to observe and comply with Company Law, the Special Regulations and other relevant laws, administrative regulations and the Articles of Association; (II) The acquirer of the shares agrees with the Company, each shareholder, director, supervisor, general manager and other senior management officer of the Company, and the Company acting for itself and for each director, supervisor, general manager and other senior management officer agrees with each shareholder to refer all disputes and claims arising from the Articles of Association or any rights or obligations conferred or imposed by Company Law or other relevant laws or administrative regulations concerning the affairs of the Company to arbitration in accordance with the Articles of Association, and any referral to arbitration shall be deemed to authorize the arbitration tribunal to conduct hearing in open session and to publish its award. The arbitration shall be final.	Article 40~~38 ~~Share certificates of the Company shall be in registered form. Matters to be specified in the Company’s shares shall include: (I) name of the Company; (II) date of incorporation of the Company; (III) category of share, par value and number of shares represented; (IV) share certificate number; and (V) other particulars that are required to be specified by the Company Law, the Special Provisions and the stock exchange where the securities of the Company are listed. A Shares issued by the Company are under centralized depositary of China Securities Depository and Clearing Corporation Limited. The Company may issue overseas listed foreign shares in the form of foreign depository receipts or other derivatives of shares in accordance with the laws of the place where the Securities of the Company are listed and the practice of securities registration and deposit. During the time the Company’s H shares remain listed on the Hong Kong Stock Exchange, the Company shall ensure that all listing documents and ownership documents (including H share certificates) relating to its securities listed on Hong Kong Stock Exchange include the statements stipulated below, and shall instruct and procure its share registrar not to register the subscription, purchase or transfer of any of its shares in the name of any particular holder unless and until such individual holder submits to the share registrar a signed form in respect to such shares which bear statements to the following effect: (I) The acquirer of the shares agrees with the Company and each shareholder of the Company, and the Company agrees with each shareholder, to observe and comply with Company Law, the Special Regulations and other relevant laws, administrative regulations and the Articles of Association; (II) The acquirer of the shares agrees with the Company, each shareholder, director, supervisor, general manager and other senior management officer of the Company, and the Company acting for itself and for each director, supervisor, general manager and other senior management officer agrees with each shareholder to refer all disputes and claims arising from the Articles of Association or any rights or obligations conferred or imposed by Company Law or other relevant laws or administrative regulations concerning the affairs of the Company to arbitration in accordance with the Articles of Association, and any referral to arbitration shall be deemed to authorize the arbitration tribunal to conduct hearing in open session and to publish its award. The arbitration shall be final.

IV-B – 8

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
		(III) The acquirer of shares agrees with the Company and each shareholder of the Company that shares in the Company are freely transferable by the holder thereof; (IV) The acquirer of shares authorizes the Company to enter into a contract on his behalf with each director and senior management officer whereby such directors and senior management officers undertake to observe and comply with their obligations to shareholders stipulated in the Articles of Association.	(III) The acquirer of shares agrees with the Company and each shareholder of the Company that shares in the Company are freely transferable by the holder thereof; (IV) The acquirer of shares authorizes the Company to enter into a contract on his behalf with each director and senior management officer whereby such directors and senior management officers undertake to observe and comply with their obligations to shareholders stipulated in the Articles of Association.
	Article 47	Article 45 Where the Company convenes a shareholders’ general meeting, distributes dividends, liquidates, or carries out other activities that require the determination of shareholdings, the Board of Directors shall set a date for registration of the shareholding. Upon close of such date, the shareholders whose name appear on the register shall be the shareholders of the Company.	Article ~~45 4~~7 Where the Company convenes a shareholders’ general meeting, distributes dividends, liquidates, or carries out other activities that require the determination of shareholdings, the Board of Directors or the convener of the shareholders’ general meeting shall set a date for registration of the shareholding. Upon close of trading on such date, the shareholders whose name appear on the register shall be the shareholders of the Company who enjoy the relevant rights.
Article 53	Article 53	Article 51 The holders of ordinary shares of the Company shall be entitled to the following rights: (I) to receive dividends and other kinds of benefit distributions based on the number of shares held by them; (II) to require, convene, chair, attend or appoint a proxy to attend a shareholders’ general meeting pursuant to the law and exercise the corresponding voting rights; (III) to supervise and manage the business operations of the Company, and to put forward suggestions and raise enquiries; (IV) to transfer, bestow or pledge shares held by them in accordance with the laws, administrative regulations and the Articles of Association; (V) to obtain related information in accordance with provisions of the Articles of Association, including: 1. obtaining the copies of the Article of Association after paying relevant costs; 2. reviewing and copying the following documents after paying reasonable costs: (1) copies of the register of members; (2) personal information of the directors, supervisors, general manager and other senior management personnel of the Company, including: a) current and previous names and aliases; b) principal address (domicile); c) nationality;	Article ~~515~~3 The holders of ordinary shares of the Company shall be entitled to the following rights: (I) to receive dividends and other kinds of benefit distributions based on the number of shares held by them; (II) to require, convene, chair, attend or appoint a proxy to attend a shareholders’ general meeting pursuant to the law and exercise the corresponding speaking rights and voting rights; (III) to supervise and manage the business operations of the Company, and to put forward suggestions and raise enquiries; (IV) to transfer, bestow or pledge shares held by them in accordance with the laws, administrative regulations and the Articles of Association; (V) to obtain related information in accordance with provisions of the Articles of Association, including: 1. obtaining the copies of the Article of Association after paying relevant costs; 2. reviewing and copying the following documents after paying reasonable costs: (1) copies of the register of members; (2) personal information of the directors, supervisors, general manager and other senior management personnel of the Company, including: a) current and previous names and aliases; b) principal address (domicile); c) nationality;

IV-B – 9

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
		d) full-time and all other part-time occupations and titles; e) identification document and its number; (3) a report showing the state of the issued share capital of the Company; (4) reports showing the total par value, quantity, maximum and minimum prices paid for each class of shares repurchased by the Company since the end of the last fiscal year and the all the expenses paid by the Company for this purpose (subdivided by Domestic Shares and foreign shares (and H shares, if applicable)); (5) minutes of the shareholders’ general meetings (only for Shareholders to inspect) and copies of special resolutions of the Company, copies of resolutions of meetings of the Board and the Supervisory Committee; (6) the latest audited financial statements of the Company, and the reports of the Board, the accounting firm and the Supervisory Committee; and (7) a copy of the latest annual inspection report already submitted to the Administration for Industry and Commerce or other competent authorities of PRC for filing; The Company shall place documents referred to in the above sub-paragraphs (1) to (7) (other than sub-paragraph (2)) and any other applicable documents at the Company’s Hong Kong address according to Hong Kong Listing Rules for public and Shareholders to inspect free of charge (except for minutes of shareholders’ general meetings which are only for shareholders to inspect). The shareholders of the Company may also inspect the resolutions of meetings of the Board and the Supervisory Committee. If any shareholder requests to inspect the aforesaid relevant information or asks for relevant data, the said shareholder shall provide the Company with written documents evidencing the class and number of shares that he/she/it held in the Company, and the Company will provide the said information or data as required by the said shareholder upon authenticating his/her/its identity. (VI) upon termination or liquidation of the Company, participating in the distribution of the Company’s residual assets based on their shareholding;	d) full-time and all other part-time occupations and titles; e) identification document and its number; (3) a report showing the state of the issued share capital of the Company; (4) reports showing the total par value, quantity, maximum and minimum prices paid for each class of shares repurchased by the Company since the end of the last fiscal year and the all the expenses paid by the Company for this purpose (subdivided by Domestic Shares and foreign shares (and H shares, if applicable)); (5) minutes of the shareholders’ general meetings (only for Shareholders to inspect) and copies of special resolutions of the Company, copies of resolutions of meetings of the Board and the Supervisory Committee; (6) the latest audited financial statements of the Company, and the reports of the Board, the accounting firm and the Supervisory Committee; and (7) a copy of the latest annual inspection report already submitted to the Administration for Industry and Commerce or other competent authorities of PRC for filing; The Company shall place documents referred to in the above sub-paragraphs (1) to (7) (other than sub-paragraph (2)) and any other applicable documents at the Company’s Hong Kong address according to Hong Kong Listing Rules for public and Shareholders to inspect free of charge (except for minutes of shareholders’ general meetings which are only for shareholders to inspect). The shareholders of the Company may also inspect the resolutions of meetings of the Board and the Supervisory Committee. If any shareholder requests to inspect the aforesaid relevant information or asks for relevant data, the said shareholder shall provide the Company with written documents evidencing the class and number of shares that he/she/it held in the Company, and the Company will provide the said information or data as required by the said shareholder upon authenticating his/her/its identity. (VI) upon termination or liquidation of the Company, participating in the distribution of the Company’s residual assets based on their shareholding;

IV-B – 10

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
		(VII) a shareholder who objects to the resolution on merger or division of the Company passed by a shareholders’ general meeting may request the Company to acquire his/her/its shares; and (VIII) any other rights stipulated by laws, administrative regulations, departmental rules, listing rules of the place where the securities of the Company are listed and the Articles of Association.	(VII) a shareholder who objects to the resolution on merger or division of the Company passed by a shareholders’ general meeting may request the Company to acquire his/her/its shares; and (VIII) any other rights stipulated by laws, administrative regulations, departmental rules, listing rules of the place where the securities of the Company are listed and the Articles of Association. When a shareholder requests to inspect the information or
			obtain the materials mentioned in the preceding paragraph, he/
			she shall provide the Company with written documents that
			prove the class and number of the Company’s shares held by
			the him/her, and the Company shall provide the shareholder
			what he/she requests after verifying his/her identity.
Article 57		Article 55 Holders of ordinary shares of the Company shall undertake the following obligations: (I) to comply with the Articles of Association; (II) to pay subscription monies according to the number of shares subscribed and the method of subscription; (III) not to make divestment unless in the circumstances stipulated by laws and regulations; and (IV) other obligations that shall be undertaken in accordance with the provisions of laws, administrative regulations, rules, normative documents, listing rules of the place where the securities of the Company are listed and the Articles of Association. A Shareholder shall not be liable to make further contribution to subsequent increase in share capital other than the terms agreed by the subscriber of the relevant shares on subscription.	Article ~~55 ~~57 Holders of ordinary shares of the Company shall undertake the following obligations: (I) to comply with the laws, administrative regulations and the Articles of Association; (II) to pay subscription monies according to the number of shares subscribed and the method of subscription; (III) not to make divestment unless in the circumstances stipulated by laws and regulations; ~~and~~ (IV) not to abuse his/her rights as a shareholder to harm the Company’s or other shareholders’ interests; not to abuse the
			Company’s independent status of legal person and the limited
			liability of the shareholders to harm the interests of creditors;
			and (V) other obligations that shall be undertaken in accordance with the provisions of laws, administrative regulations, rules, normative documents, listing rules of the place where the securities of the Company are listed and the Articles of Association. A Shareholder shall not be liable to make further contribution to subsequent increase in share capital other than the terms agreed by the subscriber of the relevant shares on subscription. A shareholder of the Company who abuses his/her
			shareholders’ rights resulting in losses to the Company or
			other shareholders shall compensate according to the laws. A
			shareholder of the Company who abuses the Company’s
			independent status of legal person and limited liability of
			shareholders in order to escape from liability, thereby
			seriously damaging the interests of creditors of the Company,
			shall jointly and severally be responsible for the Company’s

IV-B – 11

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 58		Article 58 If the shareholder who holds more than 5% of the
			shares of the Company with voting right has pledged the
			shares held by him/her, he/she shall report to the Company in
			writing on the date when the incident occurred.
	Article 60		Article 60 The controlling shareholders or de facto controllers
			of the Company shall not use their related-party relationship
			to harm the interest of the Company. In case of violating such
			requirement and causing losses to the Company, they shall be
			liable to indemnify the damages. The controlling shareholders and de facto controllers of the
			Company owe a duty of honesty and integrity to the Company
			and its public shareholders. The controlling shareholders shall
			exercise their rights as capital contributors strictly in
			accordance with the laws, and they shall not prejudice the
			lawful interests of the Company and its public shareholders
			through profit distribution, asset reorganization, external
			investment, occupying funds, loan guarantees or other means,
			and shall not use their control positions to prejudice the
			interests of the Company and its public shareholders.

IV-B – 12

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 62	Article 58 The shareholders’ general meeting is the organ of authority of the Company, and shall exercise following functions and powers pursuant in according with the laws: (I) to decide the Company’s operating directions and investment plans; (II) to elect and replace directors and determine matters relating to the remuneration of relevant directors; (III) to elect and replace non-employee representative supervisors and determine the remuneration of relevant supervisors; (IV) to consider and approve the reports of the Board of Directors; (V) to consider and approve the reports of the Supervisory Committee; (VI) to consider and approve the Company’s annual financial budgets and final accounts; (VII) to consider and approve the Company’s profit distribution proposals and loss recovery proposals; (VIII) to decide on any increase or reduction of the Company’s registered capital; (IX) to decide on merger, division, dissolution and liquidation of the Company or change of its corporate form; (X) to decide on the issuance of bonds or other securities and the listing of the Company; (XI) to decide on the engagement, dismissal or discontinuation of the appointment of the accounting firm; (XII) to amend the Articles of Association; (XIII) to consider and approve the proposals put forward by shareholders individually or jointly holding 3% or more of the Company’s shares with voting rights; and (XIV) other matter to be determined at the shareholders’ general meeting as stipulated by laws, administrative regulations, the listing rules of the place where the securities of the Company are listed or the Articles of Association.	Article 62~~58 ~~The shareholders’ general meeting is the organ of authority of the Company, and shall exercise following functions and powers pursuant in according with the laws: (I) to decide the Company’s operating directions and investment plans; (II) to elect and replace directors and determine matters relating to the remuneration of relevant directors; (III) to elect and replace non-employee representative supervisors and determine the remuneration of relevant supervisors; (IV) to consider and approve the reports of the Board of Directors; (V) to consider and approve the reports of the Supervisory Committee; (VI) to consider and approve the Company’s annual financial budgets and final accounts; (VII) to consider and approve the Company’s profit distribution proposals and loss recovery proposals; (VIII) to decide on any increase or reduction of the Company’s registered capital; (IX) to decide on merger, division, dissolution and liquidation of the Company or change of its corporate form; (X) to decide on the issuance of bonds or other securities and the listing of the Company; (XI) to decide on the engagement, dismissal or discontinuation of the appointment of the accounting firm; (XII) to amend the Articles of Association; (XIII) to consider and approve the proposals put forward by shareholders individually or jointly holding 3% or more of the Company’s shares with voting rights; and (XIV) to consider and approve the guarantee issues which shall be approved by the shareholders’ general meeting; (XV) to consider purchases and sales of significant assets
				be approved by the shareholders’ general meeting; to consider purchases and sales of significant assets
			(XV)
			within one year that exceeding 30% of the latest audited total
			assets of the Company; (XVI) to consider and approve the changes in the use of
			proceeds; (XVII) to consider share incentive plan and employee stock
			ownership plan; (XVIII) other matter to be determined at the shareholders’ general meeting as stipulated by laws, administrative regulations, the listing rules of the place where the securities of the Company are listed or the Articles of Association. The powers of the shareholders’ general meeting shall not be
			exercised by the Board of Directors or other institutions and
			individuals through any form of authorization.

IV-B – 13

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 63			Article 63 The following external guarantees of the Company
			shall be considered and approved at the shareholders’ general
			meeting. (I) any guarantee after the external guarantees provided by the
			Company and its controlled subsidiary totalling more than
			50% of the latest audited net assets; (II) any guarantee after the external guarantees provided by
			the Company totalling more than 30% of the latest audited
			total assets; (III) the guarantees provided by the Company within a year
			with a total amount more than 30% of the Company’s latest
			audited total assets; (IV) the guarantees provided to entities with gearing ratio
			more than 70%; (V) the single guarantee with the amount exceeding 10% of the latest audited net assets; (VI) the guarantees provided to shareholders, de facto
			controllers and their related parties. Guarantees in (IV) and (V) of the preceding paragraph shall
			be passed by votes representing more than two-thirds of the
			voting rights of shareholders presented at the shareholders’
			general meeting. When the Company provides guarantee to a
			wholly-owned subsidiary, or a controlled subsidiary and other
			shareholders of the controlled subsidiary provide guarantees
			on a pro-rata basis according to their interest entitlement, if
			the interest of the Company is not prejudiced, the aforesaid
			requirements applicable under items (I) to (III) of preceding
			paragraph may be exempted. The Company shall make
			consolidated disclosure about the aforesaid guarantees in the
			annual report and interim report. When a shareholders’ general meeting considers a proposal to
			provide guarantees to a shareholder, de facto controller and related party, the said shareholder or the shareholders
			controlled by the said de facto controller and its related party
			(and relevant parties as designated under the securities
			regulatory rules of the place(s) where shares of the Company
			are listed) shall abstain from voting on the proposal, and the
			proposal shall be subject to approval by more than half of the
			voting rights of the non-related shareholders attending the
			shareholders’ general meeting. In the event that the Company’s external guarantee is in
			breach of the approval authority and consideration procedures
			and causes losses to the Company, the relevant responsible
			persons shall be responsible for compensation and the
			Company shall, depending on the amount of economic losses
			suffered by the Company and the severity of the situation,
			impose corresponding penalties on the relevant responsible

IV-B – 14

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment		After Amendment (Revision)
	Article 64	Article 59 The Company shall not, without the prior approval at a shareholders’ general meeting, enter into any contract with any party (other than the directors, supervisors, general manager and other senior management personnel) pursuant to which such party shall be in charge of management of all the Company’s businesses or the Company’s major businesses.	Article ~~59 6~~4 Except when the Company is under a special circumstance such as a crisis, ~~T~~the Company shall not, without the ~~prior a~~pproval by a special resolution at a shareholders’ general meeting, enter into any contract with any party (other than the directors, supervisors, general manager and other senior management personnel) pursuant to which such party shall be in charge of management of all the Company’s businesses or the Company’s major businesses.	~~6~~4 Except when the Company is under a special
	Article 67		Article 67 When the Company convenes a shareholders’
			general meeting, a lawyer may be engaged to provide legal
			advice and make announcement on the following issues: (I) whether the procedures for convening and holding the
			meeting comply with the laws, administrative regulations and
			the Articles of Association; (II) whether the eligibility of persons attending the meeting
			and the qualification of the convener are lawful and valid; (III) whether the voting procedures and voting results are
			lawful and valid; (IV) legal advice provided on other issues at the request of
			the Company.
		Article 62 Shareholders’ general meetings shall be convened by the Board of Directors. If the Board is unable to or fails to perform its duty of convening the shareholders’ general meeting, the Supervisory Committee shall convene and preside over such meeting in a timely manner; if the Supervisory Committee cannot convene and preside over such meeting, shareholders who individually or jointly hold 10% or more of the Company’s shares for more than 90 consecutive days may convene and preside over such meeting on their own.	Delete
Article 68			Article 68 Independent non-executive Directors are entitled to
			propose an extraordinary general meeting to the Board of
			Directors. In response to such proposal of the independent
			non-executive Directors, the Board of Directors shall, in
			accordance with the laws, administrative regulations and the
			Articles of Association, reply with a written opinion to state
			whether it agrees or disagrees to convene an extraordinary
			general meeting within 10 days upon receipt of the proposal. If the Board of Directors agrees to convene the extraordinary
			general meeting, it shall issue a notice of shareholders’
			general meeting within 5 days upon making the decision. If
			the Board of Directors disagrees to convene the extraordinary
			general meeting, it shall explain the reasons and make an

IV-B – 15

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 69	Article 69	Article 63 Shareholders requesting the convening of extraordinary general meetings or class shareholders’ general meetings shall proceed in accordance with the procedures set forth below: (I) two or more Shareholders collectively holding 10% or more of the voting shares at the proposed meeting can sign one or more written requests of identical form of content requesting the Board of Directors to convene an extraordinary general meeting or a class meeting and stating the subject of the meeting. The Board shall convene an extraordinary general meeting or a class meeting as soon as possible upon receipt of the aforesaid written request. The aforesaid shareholdings hall be calculated as at the date on which the written request is made. (II) if the Board of Directors fails to issue a notice on the convening of meeting within 30 days upon the receipt of the aforesaid written request, the Shareholders who made such request may convene the meeting on their own within four months upon the Board of Directors having received such request. The convening procedures shall, to the extent possible, be identical to the procedures according which shareholders’ general meetings are to be convened by the Board of Directors. All reasonable expenses incurred for such meeting convened by the shareholders as a result of the failure of the Board of Directors and the Supervisory Committee to convene a meeting at the above requests shall be borne by the Company and deducted from the amount owed by the Company to the delinquent directors.	Article ~~63~~ 69 Shareholders requesting the convening of extraordinary general meetings or class shareholders’ general meetings shall proceed in accordance with the procedures set forth below: (I) ~~two or more ~~Shareholders collectively holding 10% or more of the voting shares at the proposed meeting can sign one or more written requests of identical form of content requesting the Board of Directors to convene an extraordinary general meeting or a class meeting and stating the subject of the meeting. The Board shall reply with an opinion to state whether it agrees or disagrees to convene an extraordinary general meeting or a class meeting within 10 days~~as soon as~~ ~~possible~~ upon receipt of the aforesaid written request. The aforesaid shareholdings hall be calculated as at the date on which the written request is made. (II) if the Board of Directors agrees to convene the
			extraordinary general meeting or a class meeting, it shall
			issue a notice of shareholders’ general meeting within 5 days
			upon making the decision, and any change to the original
			request in the notice shall be subject to consent		from the
			relevant Shareholders.~~(II) i~~If the Board of Directors to convene the extraordinary general meeting or		disagrees
					a class
			meeting, or fails to reply ~~issue a notice on the convening of~~ ~~meeting w~~ithin ~~30 1~~0 days upon the receipt of the aforesaid written request, the Shareholders who made such request shall have the right to propose to the Supervisory Committee to
			convene an extraordinary general meeting or a class meeting,
			and the request shall be submitted to the Supervisory
			Committee in writing	.~~may convene the meeting on their own~~
			~~within four months ~~	~~upon the Board of Directors having~~
			~~received such request. The convening procedures shall, to the~~
			~~extent possible, be identical to the procedures according which~~ ~~’~~
			~~shareholders general meetings are to be convened by the~~ ~~Board of Directors.~~ (III) if the Supervisory Committee agrees to convene the
			extraordinary general meeting or a class meeting, it shall issue
			a notice of shareholders’ general meeting within 5 days upon
			receipt of the request, and any change to the original request
			in the notice shall be subject to consent from the relevant
			Shareholders. If the Supervisory Committee fails to issue a
			notice of shareholders’ general meeting within the prescribed
			period, the Supervisory Committee is deemed to refuse to
			convene and preside over the shareholders’ general meeting,
			and Shareholders who, individually or jointly, hold 10% or
			more of the voting shares at the proposed meeting for more
			than 90 consecutive days may convene and preside over the
			general meeting themselves. All reasonable expenses incurred for such meeting convened by the shareholders as a result of the failure of the Board of Directors and the Supervisory Committee to convene a meeting at the above requests shall be borne by the Company and deducted from the amount owed by the Company to the delinquent directors.

IV-B – 16

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 71	Article 65 If the shareholders’ general meeting is convened by the Supervisory Committee or shareholders on their own, a written notice shall be issued to the Board of Directors.	Article 71~~65~~ If the shareholders’ general meeting is convened by the Supervisory Committee or shareholders on their own, a written notice shall be issued to the Board of Directors and report the same to the SSE for record. Before making an announcement on a resolution made at the
			shareholders’ general meeting, the percentage of shares held
			by the convening shareholders may not be less than 10%. The Supervisory Committee or the convening shareholders
			shall submit relevant evidence to the SSE when giving a
			notice of shareholders’ general meeting and making an
			announcement on the resolutions made at such meeting.
Article 75	Article 75	Article 69 When the Company decides to convene a shareholders’ general meeting, the Board of Directors, the Supervisory Committee and shareholders severally or jointly holding 3% or more of the shares of the Company shall be entitled to put forward proposals to the Company. Shareholders individually or collectively holding 3% or more of the shares of the Company may submit temporary resolutions in writing to the convener 10 days prior to the convening of the shareholders’ general meeting. The convener shall issue a supplementary notice of the shareholders’ general meeting within two days upon receipt of the proposals. Save as specified in the preceding paragraph, the convener shall not change the proposals set out in the notice of the general meeting or add any new proposal after the said notice is served. The shareholders’ general meeting shall not vote and approve a resolution on any proposal that is not listed in the notice of the shareholders’ general meeting or that is inconsistent with the Articles of Association.	Article ~~69 7~~5 When the Company decides to convene a shareholders’ general meeting, the Board of Directors, the Supervisory Committee and shareholders severally or jointly holding 3% or more of the shares of the Company shall be entitled to put forward proposals to the Company. Shareholders individually or collectively holding 3% or more of the shares of the Company may submit temporary resolutions in writing to the convener 10 days prior to the convening of the shareholders’ general meeting. The convener shall issue a supplementary notice of the shareholders’ general meeting within two days upon receipt of the proposals and announce the contents of the ad hoc proposals. Save as specified in the preceding paragraph, the convener shall not change the proposals set out in the notice of the general meeting or add any new proposal after the said notice is served. The shareholders’ general meeting shall not vote and approve a resolution on any proposal that is not listed in the notice of the shareholders’ general meeting or that is inconsistent with the Articles of Association.

IV-B – 17

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 77		Article 71 Notice of the shareholders’ general meeting shall: (I) be given in writing; (II) specify the venue, date and duration of the meeting; (III) set out the matters to be discussed at the meeting; (IV) provide the shareholders with such information and explanation as necessary for them to make informed decisions in connection with the matters to be discussed; this principle shall include (but not be limited to) when proposals are made to merge the Company, to repurchase shares of the Company, to reorganize its share capital or to effect any other reorganization of the Company, the specific conditions and contracts (if any) of the proposed transaction shall be provided, and the causes and consequences of any such proposals shall also be properly explained; (V) disclose the nature and extent of the material interests, if any, of any director, supervisor, general manager and other senior management personnel in the matters to be discussed; and provide an explanation of the differences, if any, between the way in which the matter to be discussed will affect such director, supervisor, general manager and other senior management personnel in his/her capacity as shareholders and the way in which such matter will affect other shareholders of the same class; (VI) contain the full text of any special resolution proposed to be passed at the meeting; (VII) contain a clear statement that a shareholder entitled to attend and vote has the right to appoint one or more proxies to attend and vote on his behalf and that such proxy need not be a shareholder of the Company; (VIII) specify of the equity registration date of shareholders entitled to attend the shareholders’ general meeting; and (IX) specify the time and place for lodging the power of attorney for the voting proxy for the meeting.	Article ~~71 7~~7 Notice of the shareholders’ general meeting shall: (I) be given in writing; (II) specify the venue, date and duration of the meeting; (III) set out the matters to be discussed at the meeting; (IV) provide the shareholders with such information and explanation as necessary for them to make informed decisions in connection with the matters to be discussed; this principle shall include (but not be limited to) when proposals are made to merge the Company, to repurchase shares of the Company, to reorganize its share capital or to effect any other reorganization of the Company, the specific conditions and contracts (if any) of the proposed transaction shall be provided, and the causes and consequences of any such proposals shall also be properly explained; (V) disclose the nature and extent of the material interests, if any, of any director, supervisor, general manager and other senior management personnel in the matters to be discussed; and provide an explanation of the differences, if any, between the way in which the matter to be discussed will affect such director, supervisor, general manager and other senior management personnel in his/her capacity as shareholders and the way in which such matter will affect other shareholders of the same class; (VI) contain the full text of any special resolution proposed to be passed at the meeting; (VII) contain a clear statement that a shareholder entitled to attend and vote has the right to appoint one or more proxies to attend and vote on his behalf and that such proxy need not be a shareholder of the Company; (VIII) specify of the equity registration date of shareholders entitled to attend the shareholders’ general meeting; ~~and~~ (IX) specify the time and place for lodging the power of attorney for the voting proxy for the meeting~~.;~~ (X) the names and telephone numbers of permanent contact
			persons for the affairs of the meeting; and (XI) the voting time and voting procedure on the network or
			otherwise. The notice and supplemental notice of a shareholders’ general
			meeting should sufficiently and fully disclose all the specific
			contents of all proposals. Concerning matters for discussion
			that require opinions from independent non-executive
			Directors, the opinions and reasons provided by independent
			non-executive Directors shall be disclosed at the same time
			when the notice or supplemental notice of the shareholders’
			general meeting is issued. The duration between the record date of shareholdings and the
			date of meeting shall be subject to the requirements of the
			relevant regulatory authority in the place where the shares of
			the Company are listed. The record date of shareholding, once

IV-B – 18

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 78	Article 72 The notice of a shareholders’ general meeting shall be sent to shareholders (regardless of whether they are entitled to vote at the general meeting or not) by hand or by prepaid mail, the addresses of the recipients shall be such addresses as shown in the register of members; or be published on the Company’s website and/or the websites designated by the Hong Kong Stock Exchange pursuant to the applicable laws and regulations, listing rules of the place where the securities of the Company are listed. If the public announcements are issued to the holders of overseas-listed foreign shares pursuant to the Articles of Association, the announcement shall also be published in such manner as required by the Hong Kong Listing Rules. For the holders of domestic shares, notice of the shareholders’ general meeting may be issued by way of public announcement. The announcement referred to in the preceding paragraph shall be published in one or more newspapers designated by the securities regulatory authorities of the State Council. Once such announcement is made, all holders of the Domestic Shares shall be deemed to have received the relevant notice of the shareholders’ general meeting.	Article ~~72 ~~78 The notice of a shareholders’ general meeting shall be sent to shareholders (regardless of whether they are entitled to vote at the general meeting or not) by hand or by prepaid mail, the addresses of the recipients shall be such addresses as shown in the register of members; or be published on the Company’s website and/or the websites designated by the stock exchange where the Company is listed~~Hong Kong Stock Exchange~~ pursuant to the applicable laws and regulations, listing rules of the place where the securities of the Company are listed. If the public announcements are issued to the holders of overseas-listed foreign shares pursuant to the Articles of Association, the announcement shall also be published in such manner as required by the Hong Kong Listing Rules. For the holders of domestic shares, notice of the shareholders’ general meeting may be issued by way of public announcement. The announcement referred to in the preceding paragraph shall be published in one or more newspapers designated by the securities regulatory authorities of the State Council. Once such announcement is made, all holders of the Domestic Shares shall be deemed to have received the relevant notice of the shareholders’ general meeting.
	Article 80		For matter of discussion which involve the election of
			Directors and supervisors, the notice of shareholders’ general
			meeting shall fully disclose the detailed information of the
			candidates for such Directors and supervisors, which should at
			least include the following: (I) education background, work experience and any part-time
			job; (II) whether there is any related relationship with the
			Company or the controlling shareholders and de facto
			controller of the Company; (III) disclosure of their shareholdings in the Company; (IV) whether or not they have been penalized by CSRC or
			other related securities regulatory departments and the stock
			exchange. Unless a Director or supervisor is elected via the accumulative
			voting system, each candidate of Director or supervisor shall
			be individually proposed.
Article 81			After issuance of the notice for the shareholders’ general
			meeting, the shareholders’ general meeting shall not be
			postponed or cancelled without proper reasons and the
			proposals specified in the notice shall not be withdrawn. In
			case of delay or cancellation, the convener shall make a
			public announcement and give reasons within 2 days before

IV-B – 19

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 83	Article 75 Any shareholder who is entitled to attend and vote at a shareholders’ general meeting shall be entitled to appoint one or more persons (who may not be a shareholder) as his proxy to attend and vote on his behalf. A proxy so appointed can exercise the following rights pursuant to the authorization from such shareholder: (I) such shareholder’s right to speak at the general meeting; (II) the right to demand a poll alone or jointly with others; and (III) unless otherwise required by the applicable securities listing rules or other securities laws and regulations, the right to vote by show of hands or on a poll;however, a proxy of a shareholder who has appointed more than one proxy may only vote on a poll. Where such shareholder is a recognized clearing house (or its nominee), it may authorize one or more persons as it deems fit to act as its representative(s) at any shareholders’ general meeting or any class meeting, provided that, if more than one person is so authorized, the power of attorney shall specify the number and class of shares in respect to which person is so authorized. The authorization letter is signed by the persons authorized by the recognized clearing house. The person so authorized may attend the meeting and exercise the rights on behalf of the recognized clearing house (or its nominees) (without presenting evidence of their shareholding, notarized authorization and/or further proof showing their due authorization) as if such person were an individual shareholder of the Company.	Article ~~758~~3 All shareholders registered on the equity registration date are entitled to attend the general meeting of
			shareholders and exercise voting rights in accordance with
			relevant laws, regulations and the Articles of Association. Any shareholder who is entitled to attend and vote at a shareholders’ general meeting shall be entitled to appoint one or more persons (who may not be a shareholder) as his proxy to attend and vote on his behalf. A proxy so appointed can exercise the following rights pursuant to the authorization from such shareholder: (I) such shareholder’s right to speak at the general meeting; (II) the right to demand a poll alone or jointly with others; and (III) unless otherwise required by the applicable securities listing rules or other securities laws and regulations, the right to vote by show of hands or on a poll;however, a proxy of a shareholder who has appointed more than one proxy may only vote on a poll. Where such shareholder is a recognized clearing house (or its nominee), it may authorize one or more persons as it deems fit to act as its representative(s) at any shareholders’ general meeting or any class meeting, provided that, if more than one person is so authorized, the power of attorney shall specify the number and class of shares in respect to which person is so authorized. The authorization letter is signed by the persons authorized by the recognized clearing house. The person so authorized may attend the meeting and exercise the rights on behalf of the recognized clearing house (or its nominees) (without presenting evidence of their shareholding, notarized authorization and/or further proof showing their due authorization) as if such person were an individual shareholder of the Company.
Article 84			An individual Shareholder who attends the meeting in person
			shall present his/her own identity card or other valid proof or
			certification or stock account card capable of confirming his/
			her identity; if a proxy is appointed to attend the meeting, the
			proxy should present his/her own valid identity document and
			the form of proxy authorized by the Shareholder. If a Shareholder is a corporate legal person, its legal
			representative or a proxy appointed by its legal representative
			shall attend the meeting. If its legal representative attends the
			meeting in person, he/she should present his identity card or
			other valid proof capable of proving his qualification of being
			the legal representative; if a proxy is appointed to attend the
			meeting, the proxy should present his/her own identity card or
			the authorized form of proxy in writing issued by the legal
			representative of the corporate legal person in accordance with

IV-B – 20

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 87	Article 78 Any proxy form issued to a shareholder by the Board of Directors of the Company for appointing a proxy of shareholder shall be in such format as to allow the shareholder to freely instruct the proxy to vote “FOR” or “AGAINST” and to give separate instructions on each matter to be voted at the meeting. Such form shall contain a statement that the proxy may vote as he deems fit in the absence of the shareholder’s instruction.	Article ~~788~~7 Any proxy form issued to a shareholder by the Board of Directors of the Company for appointing a proxy of shareholder shall be in such format as to allow the shareholder to freely instruct the proxy to vote “FOR” or “AGAINST” and to give separate instructions on each matter to be voted at the meeting. Such form shall contain a statement ~~that ~~on whether the proxy may vote as he deems fit in the absence of the shareholder’s instruction. The instrument issued by the shareholder to authorize another
			person to attend the general meeting shall state the following
			contents: (I) name of the proxy; (II) whether the proxy has voting rights; (III) indication of consent, objection or abstention concerning
			each proposal for resolution on the shareholders’ general
			meeting agenda; (IV) date of signing of instrument and term of validity; (V) signature (or seal) of the principal. If the principal is a
			legal person shareholder, the seal of the legal person shall be
			affixed.
	Article 89		A registration record for attendants at the meeting shall be
			compiled by the Company. The registration record shall contain items including the
			names of attendants (or names of organizations), identity card
			numbers, residential addresses, the number of shares held or
			representing the voting rights and names of the principals (or
			name of organizations).
	Article 90		The convener and the lawyer shall examine legality of the
			shareholders’ qualifications according to the register of
			members provided by the securities registrations and clearing
			organizations. The names of shareholders and the number of
			shares with voting rights shall be registered. The registration
			at the meeting shall terminate before the chairman of the
			meeting announces the number of shareholders and proxies
			attending the meeting and the shares held with voting rights.

IV-B – 21

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 91	Article 80 Shareholders’ general meetings are convened by the Board of Directors and the chairman of the Board shall act as chairman of the shareholders’ general meeting. If the chairman of the Board is unable or fails to perform his/her duties, a Director selected by more than half of all Directors shall act as chairman of the meeting; if no person is elected as chairman of the shareholders’ general meeting, the attending shareholders may elect a person to act as the chairman. Where the shareholders fail to elect a chairman of the shareholders’ general meeting for any reasons, the shareholder (including his/her proxy) present in person who holds the largest number of voting shares shall be the chairman of the shareholders’ general meeting. A shareholders’ general meeting convened by the Supervisory Committee itself shall be presided over by the chairman of the Supervisory Committee. If the chairman of the Supervisory Committee is unable or fails to perform his duties, one supervisor shall be elected jointly by more than half of the supervisors to preside over the meeting. The shareholders’ general meeting convened by shareholder(s) itself/themselves shall be presided over by a representative elected by the convener.	Article ~~809~~1 Shareholders’ general meetings are convened by the Board of Directors and the chairman of the Board shall act as chairman of the shareholders’ general meeting. If the chairman of the Board is unable or fails to perform his/her duties, a Director selected by more than half of all Directors shall act as chairman of the meeting; if no person is elected as chairman of the shareholders’ general meeting, the attending shareholders may elect a person to act as the chairman. Where the shareholders fail to elect a chairman of the shareholders’ general meeting for any reasons, the shareholder (including his/her proxy) present in person who holds the largest number of voting shares shall be the chairman of the shareholders’ general meeting. A shareholders’ general meeting convened by the Supervisory Committee itself shall be presided over by the chairman of the Supervisory Committee. If the chairman of the Supervisory Committee is unable or fails to perform his duties, one supervisor shall be elected jointly by more than half of the supervisors to preside over the meeting. The shareholders’ general meeting convened by shareholder(s) itself/themselves shall be presided over by a representative elected by the convener. In a shareholders’ general meeting, if the chairman of the meeting contravenes the rules of procedures, making the meeting impossible to proceed, with consent from more than a half of the attending shareholders with voting rights, the shareholders’ general meeting may nominate one person to serve as the chairman and to continue the meeting.
	Article 94	Article 83 At the annual general meeting, the Board and the Supervisory Committee shall report to the shareholders’ general meeting on their work in the last year.	Article ~~839~~4 At the annual general meeting, the Board and the Supervisory Committee shall report to the shareholders’ general meeting on their work in the last year. Each independent non-executive Director shall also present a work report.
Article 97	Article 97	Article 86 The general meeting shall have minutes prepared by the secretary to the Board of Directors. The minutes of the general meeting shall contain the following contents: (I) the date and venue for convening the meeting, meeting agenda and the name of the convenor of the meeting; (II) the name of the chairman of the meeting as well as those of the directors, supervisors, general managers and other senior management personnel who attend the meeting as voting and non-voting attendees; (III) the number of shareholders and proxies attending the meeting, the total number of voting shares held by them and the proportion of the total number of shares of the Company; (IV) description on the entire course of consideration of each proposal, the main points of the speech and the voting results; (V) queries and recommendations of the shareholders and the corresponding response or explanation; (VI) the names of the counter and the scrutineer; (VII) other contents that should be recorded in the minutes as provided in the Articles of Association.	Article ~~86~~97 The general meeting shall have minutes prepared by the secretary to the Board of Directors. The minutes of the general meeting shall contain the following contents: (I) the date and venue for convening the meeting, meeting agenda and the name of the convenor of the meeting; (II) the name of the chairman of the meeting as well as those of the directors, supervisors, general managers and other senior management personnel who attend the meeting as voting and non-voting attendees; (III) the number of shareholders and proxies attending the meeting, the total number of voting shares held by them and the proportion of the total number of shares of the Company; (IV) description on the entire course of consideration of each proposal, the main points of the speech and the voting results; (V) queries and recommendations of the shareholders and the corresponding response or explanation; (VI) the names of the lawyers and counter and the scrutineer; (VII) other contents that should be recorded in the minutes as provided in the Articles of Association.

IV-B – 22

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

	No.	Before Amendment	After Amendment (Revision)
	Article 99	Article 88 The convener shall ensure that the general meeting is held continuously until final resolutions have been reached. In the event that the general meeting is suspended or the shareholders fail to reach any resolution due to force majeure or for other special reasons, necessary measures shall be taken to resume the meeting as soon as possible or the meeting shall be terminated directly.	Article ~~889~~9 The convener shall ensure that the general meeting is held continuously until final resolutions have been reached. In the event that the general meeting is suspended or the shareholders fail to reach any resolution due to force majeure or for other special reasons, necessary measures shall be taken to resume the meeting as soon as possible or the meeting shall be terminated directly, and make a timely announcement. At the same time, the convener shall report to the CSRC branch of the place where Company is located and the SSE.
	Article 101	Article 90 The following matters shall be resolved by way of ordinary resolutions at a shareholders’ general meeting: (I) Work reports of the Board of Directors and the Supervisory Committee; (II) Plans for profit distribution and recovery of losses drafted by the Board of Directors; (III) Appointment or removal of members of the Board of Directors and the Supervisory Committee (except for staff representative supervisors), and their remuneration and method of payment thereof; (IV) The Company’s annual financial budgets and final accounts, balance sheets, income statements and other financial statements; and (V) Any matters other than those required by the laws, administrative regulations, the listing rules of the place where the shares of the Company are listed or the Articles of Association to be approved by special resolution.	Article ~~901~~01 The following matters shall be resolved by way of ordinary resolutions at a shareholders’ general meeting: (I) Work reports of the Board of Directors and the Supervisory Committee; (II) Plans for profit distribution and recovery of losses drafted by the Board of Directors; (III) Appointment or removal of members of the Board of Directors and the Supervisory Committee (except for staff representative supervisors), and their remuneration and method of payment thereof; (IV) The Company’s annual financial budgets and final accounts, balance sheets, income statements and other financial statements; and (V) Annual report of the Company; (VI) Any matters other than those required by the laws, administrative regulations, the listing rules of the place where the shares of the Company are listed or the Articles of Association to be approved by special resolution.
Article 102	Article 102	Article 91 The following matters shall be approved by special resolutions at a shareholders’ general meeting: (I) Increase or reduction of the share capital, and issue of any class of shares, warrants and other similar securities of the Company; (II) Issuance of debentures of the Company; (III) Demerger, merger, dissolution, liquidation or change in the form of the Company; (IV) Amendments to the Articles of Association; (V) Any other matters approved by ordinary resolution at a shareholders’ general meeting as having a material impact on the Company and are required to be approved by a special resolution; (VI) Any other matters required by the laws, administrative regulations, the Articles of Association and the listing rules of the place where the shares of the Company are listed to be approved by special resolution.	Article ~~91~~102 The following matters shall be approved by special resolutions at a shareholders’ general meeting: (I) Increase or reduction of the share capital, and issue of any class of shares, warrants and other similar securities of the Company; (II) Issuance of debentures of the Company; (III) Demerger, spin-off, merger, dissolution, liquidation or change in the form of the Company; (IV) Amendments to the Articles of Association; (V) The purchases and sales of significant assets by the Company within one year or the guarantee amount exceeding 30% of the latest audited total assets of the Company; (VI) Share incentive plan; (VII) Any other matters approved by ordinary resolution at a shareholders’ general meeting as having a material impact on the Company and are required to be approved by a special resolution; and (VIII) Any other matters required by the laws, administrative regulations, the Articles of Association and the listing rules of the place where the shares of the Company are listed to be approved by special resolution.

IV-B – 23

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 103	Article 92 Shareholders (including proxies) shall exercise their voting rights in accordance with the number of shares with voting rights represented by them, and each share entitles the shareholder one voting right at the shareholders’ general meeting. However, the shares of the Company held by the Company shall not be entitled to vote and such shares shall not be counted as part of the total number of shares entitled to vote at the shareholders’ general meeting. Where any shareholder is, under applicable laws and regulations and the listing rules of the place where the shares of the Company are listed, required to abstain from voting on any particular resolution or restricted to voting only for or against any particular resolution, any vote cast by or on behalf of such shareholder in violation of such requirement or restriction shall not be counted in the results. Shares of the Company held by the Company that carry no voting rights and such shares shall not be counted toward the total number of shares with voting rights held by shareholders attending the shareholders’ general meeting.	Article ~~92~~103 Shareholders (including proxies) shall exercise their voting rights in accordance with the number of shares with voting rights represented by them, and each share entitles the shareholder one voting right at the shareholders’ general meeting. ~~However, the shares of the Company held by the~~
				. ~~However, the shares of the Company held by the~~
			~~Company shall not be entitled to vote and such shares shall~~
			~~not be counted as part of the total number of shares entitled~~ ~~to vote at the shareholders’ general meeting.~~ Where any shareholder is, under applicable laws and regulations and the listing rules of the place where the shares of the Company are listed, required to abstain from voting on any particular resolution or restricted to voting only for or against any particular resolution, any vote cast by or on behalf of such shareholder in violation of such requirement or restriction shall not be counted in the results. When the shareholders’ general meeting considers a material
			event that may affect the interest of minority investors, the
			votes of minority investors should be counted separately. Such
			result of the separate vote-counting should be disclosed to the
			public in a timely manner. Shares of the Company held by the Company that carry no voting rights and such shares shall not be counted toward the total number of shares with voting rights held by shareholders attending the shareholders’ general meeting. If a shareholder purchases voting shares of the Company in
			violation of paragraph 1 and paragraph 2 of Article 63 of the
			Securities Law, such shares in excess of the prescribed
			proportion shall not be allowed to exercise voting rights for a
			period of 36 months after the purchase, and shall not be
			counted in the total number of shares with voting rights
			present at the shareholders’ general meeting. The Board of Directors, independent non-executive Directors,
			shareholders holding more than 1% of the voting shares or
			investor protection institutions established in accordance with
			laws, administrative regulations or the provisions of the CSRC
			may openly solicit voting rights from shareholders.
			Solicitation of voting rights from shareholders should make
			sufficient disclosure of information, including the specific
			voting intention, to persons from whom such voting rights are
			solicited. Solicitation of voting rights from shareholders by
			offering money or other forms of consideration is forbidden.
			Save for the statutory requirements, the Company shall not set
			a minimum shareholding limit for voting right solicitation.

IV-B – 24

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 104	Article 104	Article 93 When a related party transaction (as defined under the Hong Kong Listing Rules) is considered at a shareholders’ general meeting, related shareholders and their close associates (as defined under the Hong Kong Listing Rules) shall not vote, and the voting shares held by them shall not be counted in the total number of shares with voting rights. The announcement of the resolutions of the shareholders’ general meeting shall fully disclose the voting of non-related persons. Before any related party transaction is considered at a shareholders’ general meeting, the Company shall determine the scope of related shareholders in accordance with relevant laws, regulations and normative documents. Related persons or their authorized representatives may attend the shareholders’ general meeting, and may clarify their points of view to the attending shareholders in accordance with procedures of the meeting, but they shall take the initiative to abstain from voting. When relevant related party transactions are considered at a shareholders’ general meeting, related shareholders shall take the initiative to abstain from voting; if the related shareholders don’t take the initiative to abstain from voting, other shareholders present at the meeting shall have the right to require them to abstain from voting. After related persons have abstained from voting, other shareholders shall vote according to their voting rights and pass the corresponding resolutions in accordance with the provisions of the Articles of Association. The chairman of the meeting shall announce the number of shareholders and proxies other than related persons present at the general meeting and the total number of their voting shares. In order to be valid, the resolutions made at the shareholders’ general meeting on matters relating to related party transactions shall be passed by more than half of the votes cast by the non-related shareholders attending the general meeting. However, when the related party transaction involves matters that need to be passed by special resolution as stipulated in the Articles of Association, the resolution of the shareholders’ general meeting, in order to become valid, has to be passed by more than two-thirds of the voting rights held by the non-related persons attending the general meeting. If a related person or its close associates violates the provisions of this article and participates in voting, the voting on the relevant related party transaction shall be invalid.	Article ~~931~~04 When a related party transaction ~~(as defined~~ ~~under the Hong Kong Listing Rules) i~~s considered at a shareholders’ general meeting, related shareholders and their close associates ~~(as defined under the Hong Kong Listing~~ ~~Rules) ~~shall not vote, and the voting shares held by them shall not be counted in the total number of shares with voting rights. The announcement of the resolutions of the shareholders’ general meeting shall fully disclose the voting of non-related persons. Before any related party transaction is considered at a shareholders’ general meeting, the Company shall determine the scope of related shareholders in accordance with relevant laws, regulations and normative documents. Related persons or their authorized representatives may attend the shareholders’ general meeting, and may clarify their points of view to the attending shareholders in accordance with procedures of the meeting, but they shall take the initiative to abstain from voting. When relevant related party transactions are considered at a shareholders’ general meeting, related shareholders shall take the initiative to abstain from voting; if the related shareholders don’t take the initiative to abstain from voting, other shareholders present at the meeting shall have the right to require them to abstain from voting. After related persons have abstained from voting, other shareholders shall vote according to their voting rights and pass the corresponding resolutions in accordance with the provisions of the Articles of Association. The chairman of the meeting shall announce the number of shareholders and proxies other than related persons present at the general meeting and the total number of their voting shares. In order to be valid, the resolutions made at the shareholders’ general meeting on matters relating to related party transactions shall be passed by more than half of the votes cast by the non-related shareholders attending the general meeting. However, when the related party transaction involves matters that need to be passed by special resolution as stipulated in the Articles of Association, the resolution of the shareholders’ general meeting, in order to become valid, has to be passed by more than two-thirds of the voting rights held by the non-related persons attending the general meeting. If a related person or its close associates violates the provisions of this article and participates in voting, the voting on the relevant related party transaction shall be invalid.

IV-B – 25

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 107		Resolutions in respect of the election of Directors or
			supervisors may be passed by way of cumulative voting at
			the shareholders’ general meeting pursuant to the Articles of
			Association or resolution of the shareholders’ general meeting.
			Cumulative voting mentioned in the preceding paragraph
			means that when Directors or supervisors are being elected at
			a shareholders’ general meeting, each share has as the same
			voting rights as the candidates for Directors or supervisors,
			and the shareholders’ voting rights may be used in a
			concentrated manner. The implementation rules of the cumulative voting system are
			as follows. (I) the election of executive Directors, non-executive
			Directors, independent non-executive Directors and
			supervisors shall be voted separately. 1. When electing executive Directors, the number of the
			voting rights held by shareholders present equals to the total
			number of shares held by them times the number of executive
			Directors to be elected, such portion of voting rights shall
			only be voted when electing executive Director candidates. 2. When electing non-executive Directors, the number of the
			voting rights held by shareholders present equals to the total
			number of shares held by them times the number of non-
			executive Directors to be elected, such portion of voting rights
			shall only be voted when electing non-executive Director
			candidates. 3. When electing independent non-executive Directors, the
			number of the voting rights held by shareholders present
			equals to the total number of shares held by them times the
			number of independent non-executive Directors to be elected,
			such portion of voting rights shall only be voted when
			electing independent non-executive Director candidates. 4. When electing supervisors, the number of the voting rights
			held by shareholders present equals to the total number of
			shares held by them times the number of supervisors to be
			elected, such portion of voting rights shall only be voted
			when electing supervisor’s candidates. (II) The number of votes held by each share is equal to the
			number of Directors or supervisors the shareholder is entitled
			to elect, and the shareholders may divide their votes equally
			among each candidate for Directors or supervisors, or may
			concentrate their votes on one or some of the candidate(s),
			provided that the total number of votes exercised by a
			shareholder shall not exceed the total number of votes he/she
			is entitled to for such category of candidates. (III) The candidates for Directors and supervisors shall finally
			be determined according to the number of votes and the
			requirements for Directors and supervisors in the Articles of
			Association.
	Article 108		Except for the cumulative voting system, all proposals shall
			be voted individually at the shareholders’ general meeting. If
			there are a number of proposals related to the same matter,
			votes shall be cast in the order of which the proposals are
			presented. Except where a shareholders’ general meeting is
			suspended or no resolution can be adopted due to force
			majeure or other special reasons, no proposal shall be set
			aside or rejected for voting at the meeting.

IV-B – 26

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 109		When considering a proposal at the shareholders’ general
			meeting, no amendment shall be made thereto; otherwise, the
			relevant change shall be treated as a new proposal which
			cannot proceed for voting at such shareholders’ general
			meeting.
	Article 110	Article 96 A resolution shall be decided on a show of hands at any shareholders’ general meeting, unless, before or after a vote is carried out by a show of hands, a poll demanded by the following persons or required by relevant regulations of the securities regulatory authority of the place where the shares of the Company are listed: (I) the chairman of the meeting; (II) at least two shareholders with voting rights or their proxies; or (III) one or more shareholders (including their proxies) individually or collectively holding over ten percent (including ten percent) of voting shares at the meeting. Unless a poll is demanded pursuant to the preceding provision, the chairman shall declare whether the resolution has been passed based on the results of showing of hands, and record the same in the minutes of meeting as conclusive evidence. There is no need to provide evidence of the number or proportion of votes in favor of or against such resolution. The demand for a poll may be withdrawn by the person who demanded the same. If a poll is demanded in accordance with the relevant regulations of the securities regulatory authority at the place where the shares of the Company are listed, the chairman of the meeting may make a decision in good faith to permit the resolution relating merely to procedures or administrative matters to be passed by show of hands. In the event of vote by casing a poll, the Company shall appoint the scrutineer for vote counting in accordance with the listing rules of the place where the shares of the Company are listed, and disclose the number of relevant votes to the extent required by laws, administrative regulations, requirements of relevant regulatory authorities or the listing rules of the place where the shares of the Company are listed.
			~~Article 96 A resolution shall be decided on a show of hands~~ ~~’~~
			~~at any shareholders general meeting, unless, before or after a~~
			~~vote is carried out by a show of hands, a poll demanded by~~
			~~the following persons or required by relevant regulations of~~
			~~the securities regulatory authority of the place where the~~ ~~shares of the Company are listed:~~ ~~(I) the chairman of the meeting;~~
			~~(II) at least two shareholders with voting rights or their~~ ~~proxies; or~~
			~~(III)~~ ~~one~~ ~~or~~ ~~more~~ ~~shareholders~~ ~~(including~~ ~~their~~ ~~proxies)~~
			~~individually or collectively holding over ten percent (including~~ ~~ten percent) of voting shares at the meeting.~~
			~~Unless~~ ~~a~~ ~~poll~~ ~~is~~ ~~demanded~~ ~~pursuant~~ ~~to~~ ~~the~~ ~~preceding~~
			~~provision, the chairman shall declare whether the resolution~~
			~~has been passed based on the results of showing of hands,~~
			~~and record the same in the minutes of meeting as conclusive~~
			~~evidence. There is no need to provide evidence of the number~~ ~~or proportion of votes in favor of or against such resolution.~~
			~~The demand for a poll may be withdrawn by the person who~~ ~~demanded the same.~~
			~~If~~ ~~a~~ ~~poll~~ ~~is~~ ~~demanded~~ ~~in~~ ~~accordance~~ ~~with~~ ~~the~~ ~~relevant~~
			~~regulations of the securities regulatory authority at the place~~
			~~where the shares of the Company are listed, the chairman of~~
			~~the meeting may make a decision in good faith to permit the~~
			~~resolution relating merely to procedures or administrative~~ ~~matters to be passed by show of hands.~~
			~~In the event of vote by casing a poll, the Company shall~~
			~~appoint the scrutineer for vote counting in accordance with~~
			~~the listing rules of the place where the shares of the Company~~
			~~are listed, and disclose the number of relevant votes to the~~
			~~extent~~ ~~required~~ ~~by~~ ~~laws,~~ ~~administrative~~ ~~regulations,~~
			~~requirements of relevant regulatory authorities or the listing~~
			~~rules of the place where the shares of the Company are listed.~~ Article 110 Except for proposals concerning the procedures of
			the shareholders’ general meeting or administrative matters,
			which may be decided in good faith by the chairman of the
			shareholders’ general meeting and voted on by a show of
			hands, the shareholders’ general meeting shall adopt an open
			ballot.
	Article 111	Article 97 A poll demanded on such matters as the election of chairman or the adjournment of the meeting shall be taken immediately. A poll demanded on any other matter shall be taken at such time as the chairman decided, and the meeting may proceed to discuss other matters. The results of the poll shall still be deemed to be a resolution passed at that meeting.	Article ~~97 1~~11
				~~A poll demanded on such matters as the~~
			~~election of chairman or the adjournment of the meeting shall~~
			~~be taken immediately. A poll demanded on any other matter~~
			~~shall be taken at such time as the chairman decided, and the~~
			~~meeting may proceed to discuss other matters. The results of~~
			~~the poll shall still be deemed to be a resolution passed at that~~ ~~meeting. ~~The same voting right may only elect one of the voting methods: on-site, internet or other voting methods. If
			the same voting right has voted repeatedly, the voting
			resulting of the first time shall prevail.

IV-B – 27

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 115	Article 101 The chairman of meeting shall determine whether a resolution at a shareholders’ general meeting has been passed. His decision, which is final and conclusive, shall be announced at the meeting and recorded in the minutes of the meeting.	Article ~~101 ~~11
				~~The chairman of meeting shall determine~~ ~~’~~
			~~whether a resolution at a shareholders general meeting has~~
			~~been passed. His decision, which is final and conclusive, shall~~
			~~be announced at the meeting and recorded in the minutes of~~ ~~the meeting. ~~Before voting on a proposal in the shareholders’ general meeting, two shareholder representatives shall be
			elected to participate in voting counting and act as scrutineers.
			When shareholders are related parties in a proposed matter,
			the relevant shareholders and proxies are not allowed to
			participate in vote counting and scrutinizing process. When a proposal is voted in a shareholders’ general meeting,
			the vote counting and scrutinizing process shall be jointly
			responsible and performed by a lawyer, a representative of
			shareholders and a representative of supervisors. A shareholder of the Company or his/her proxy who has voted
			through the internet or other voting methods shall be entitled
			to inspect his/her own voting result through the corresponding
			voting system.
	Article 116		The closing time of a physical shareholders’ general meeting
			must not be earlier than the closing time of the meeting
			through internet or other methods. The chairman of the
			meeting shall announce the voting for each proposal and its
			result on site, and shall declare whether the proposal has been
			approved according to the voting result. Before announcing the official voting result, the related
			parties including the Company, vote counting persons,
			scrutineers, substantial shareholders and internet service
			providers involved in the physical shareholders’ general
			meeting, internet and other voting methods shall have a duty
			of confidentiality on the voting details.
	Article 119		Resolutions of a shareholders’ general meeting shall be
			announced in a timely manner, and the announcement shall set
			out the number of shareholders and proxies attending the
			meeting, the total number of shares held with voting rights
			and the percentage in the total number of shares of the
			Company with voting rights, method of voting, voting result
			of each proposal and the details of each resolution which has
			been passed.
	Article 120		If any proposal has not been passed or modification has been
			made to a resolution of the preceding shareholders’ general
			meeting by the current shareholders’ general meeting, a
			special note should be contained in the announcement on
			resolutions of the shareholders’ general meeting.
	Article 121		Where a proposal on the election of Directors and supervisors
			is adopted at the shareholders’ general meeting, the newly
			elected Directors and supervisors shall take office on the date
			of approval at the shareholders’ general meeting.
	Article 122		When a shareholders’ general meeting has passed resolutions
			on the distribution of cash dividends, bonus shares or increase
			in share capital by conversion of capital reserves, the
			Company shall implement the specific proposal within two
			months after conclusion of the shareholders’ general meeting.

IV-B – 28

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 125	Article 106 Rights conferred to class shareholders may not be varied or abrogated by the Company unless approved by way of a special resolution at a shareholders’ general meeting and by the affected class shareholders at a separate shareholders’ meeting convened in accordance with Articles 108 to 112 hereof. Subject to the approval of the securities regulatory authorities of the State Council, where shareholders of the Company transfer all or part of the unlisted shares they hold to foreign investors and list and trade the unlisted shares on an overseas stock exchange, and convert all or part of the unlisted shares they hold into overseas listed shares and arrange for the listing and trading of these shares on an overseas stock exchange, it shall not be regarded as the Company’s proposed modification or termination of the rights of a class of shareholders.	Article ~~106 ~~125 Rights conferred to class shareholders may not be varied or abrogated by the Company unless approved by way of a special resolution at a shareholders’ general meeting and by the affected class shareholders at a separate shareholders’ meeting convened in accordance with Articles 127~~108 ~~to 131~~112~~ hereof. ~~Subject to the approval of the securities regulatory authorities~~ ~~of the State Council, where shareholders of the Company~~ ~~transfer all or part of the unlisted shares they hold to foreign~~ ~~investors and list and trade the unlisted shares on an overseas~~ ~~stock exchange, and convert all or part of the unlisted shares~~ ~~they hold into overseas listed shares and arrange for the~~ ~~listing and trading of these shares on an overseas stock~~ ~~exchange, it shall not be regarded as the Company’s proposed~~ ~~modification~~ ~~or~~ ~~termination~~ ~~of~~ ~~the~~ ~~rights~~ ~~of~~ ~~a~~ ~~class~~ ~~of~~ ~~shareholders.~~
	Article 127	Article 108 Shareholders of the affected class, whether or not otherwise entitled to vote at the shareholders’ general meetings, shall nevertheless be entitled to vote at class meetings in respect to matters concerning sub-paragraphs (II) to (VIII), (XI) and (XII) of Article 107 hereof, but the interested shareholder(s) shall not be entitled to vote at class meetings. “Interested shareholder(s)”, as such term is mentioned in the preceding paragraph, means: (I) In the case of a repurchase of shares by the Company by pro rata offers to all shareholders or by way of on-market dealing on stock exchange(s) under Article 27 hereof, an “interested shareholder” is a controlling shareholder as defined in Article 57 hereof; (II) In the case of a repurchase of shares by the Company outside stock exchange by way of agreement under Article 27 hereof, an “interested shareholder” refers to a shareholder who is related to such agreement; or (III) In the case of a restructuring scheme of the Company, an “interested shareholder” refers to a shareholder within a class who bears less than a proportionate liability than other shareholders of such class or who has an interest different from those of other shareholders of such class.	Article ~~108 1~~27 Shareholders of the affected class, whether or not otherwise entitled to vote at the shareholders’ general meetings, shall nevertheless be entitled to vote at class meetings in respect to matters concerning sub-paragraphs (II) to (VIII), (XI) and (XII) of Article ~~107 ~~126 hereof, but the interested shareholder(s) shall not be entitled to vote at class meetings. “Interested shareholder(s)”, as such term is mentioned in the preceding paragraph, means: (I) In the case of a repurchase of shares by the Company by pro rata offers to all shareholders or by way of on-market dealing on stock exchange(s) under Article 27 hereof, an “interested shareholder” is a controlling shareholder as defined in Article 57 hereof; (II) In the case of a repurchase of shares by the Company outside stock exchange by way of agreement under Article 27 hereof, an “interested shareholder” refers to a shareholder who is related to such agreement; or (III) In the case of a restructuring scheme of the Company, an “interested shareholder” refers to a shareholder within a class who bears less than a proportionate liability than other shareholders of such class or who has an interest different from those of other shareholders of such class.
	Article 128	Article 109 Resolutions of a class meeting shall be passed by shareholders present at the class meeting representing two- thirds or more of the voting rights in accordance with Article 108 hereof.	Article ~~109 ~~128 Resolutions of a class meeting shall be passed by shareholders present at the class meeting representing two-thirds or more of the voting rights in accordance with Article ~~108 1~~27 hereof.
Article 129	Article 129	Article 110 In the event that the Company convenes a class meeting, a written notice shall be issued, according to Article 70 of the Articles of Association, to all the shareholders whose names appear on the register of members of such class, specifying the matters proposed to be considered, the date and place of the meeting. If the listing rules of the place where the Securities of the Company are listed have specific provisions, such provisions shall be complied with.	Article ~~110 ~~129 In the event that the Company convenes a class meeting, a written notice shall be issued, according to Article ~~70 ~~76 of the Articles of Association, to all the shareholders whose names appear on the register of members of such class, specifying the matters proposed to be considered, the date and place of the meeting. If the listing rules of the place where the Securities of the Company are listed have specific provisions, such provisions shall be complied with.

IV-B – 29

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 132	Article 113 Directors shall be elected at the shareholders’ general meetings for a term of 3 years. Upon maturity of the term of office, a director shall be eligible to offer himself for re-election and re-appointment. Written notice of the intention to nominate a candidate for directorship and the candidate’s indication of his or her willingness to accept the nomination shall be sent to the Company seven days prior to the shareholders’ general meeting. The election and removal of the chairman shall be approved by more than half of all directors. The chairman shall serve for a term of three years and may be re-elected. Any person appointed by the Board of Directors as director to fill a casual vacancy on or as an addition to the Board of Directors shall hold office only until the first annual general meeting of the issuer after his/her appointment, and shall then be eligible for re- election. Subject to the relevant laws and administrative regulations, a director (including an executive director) may be removed by an ordinary resolution in a shareholders’ general meeting, before the expiration of his term of office; but such removal shall not have prejudice to any damage claim made by that director under any contract. A director is not required to hold any shares of the Company.	Article ~~113 ~~132 Directors shall be elected at the shareholders’ general meetings for a term of 3 years, and shall be discharged from duty at the shareholders’ general meetings
				general meetings
			before the expiration of his or her term
			~~Any person appointed by the Board of Directors as director to~~
			~~fill a casual vacancy on or as an addition to the Board of~~
			~~Directors shall hold office only until the first annual general~~
			~~meeting of the issuer after his/her appointment, and shall then~~ ~~be eligible for re- election.~~ Subject to the relevant laws and administrative regulations, a director (including an executive director) may be removed by an ordinary resolution in a shareholders’ general meeting, before the expiration of his term of office; but such removal shall not have prejudice to any damage claim made by that director under any contract. A director is not required to hold any shares of the Company.
Article 133		Article 114 The term of office of a director shall start from the date on which the said director assumes office to the expiry of the current term of the Board of Directors. If the term of office of a director expires but re-election is not made in a timely manner, the said director shall continue to perform the duties as director pursuant to the laws, administrative regulations, normative documents and the Articles of Association until the elected director assumes his office.	Article ~~114 ~~133 The term of office of a director shall start from the date on which the said director assumes office to the expiry of the current term of the Board of Directors. If the term of office of a director expires but re-election is not made in a timely manner, the said director shall continue to perform the duties as director pursuant to the laws, administrative regulations, normative documents and the Articles of Association until the elected director assumes his office. Directors may also be manager or other senior management
			personnel, but the total number of Directors who also hold the
			positions of manager or other senior management personnel
			and Directors who are employee representatives shall not

IV-B – 30

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 135	Article 135	Article 116 Directors shall comply with laws, regulations and normative documents, the listing rules of the place where the shares of the Company are listed,the Articles of Association, and carry out their duties of diligence as the following: (I) To prudently, earnestly and diligently exercise the rights conferred by the Company so as to ensure that the Company’s business activities meet the requirements of laws, administrative rules, normative documents and the various State economic policies and that the business activities shall not exceed the business scope specified in the business license; (II) To treat all the shareholders fairly; (III) To carefully read the relevant business and financial reports of the Company and keep informed of the operation and management conditions of the Company in a timely manner; (IV) To provide the relevant information and materials to the board of supervisors faithfully, and not impeding the board of supervisors or supervisors in exercising their functions and powers; (V) To ensure that they have reserved sufficient time and effort for participating in the Company’s affairs and cautiously judging the risks and gains arising from the resolutions proposed; the directors, in principle, shall attend the meeting of the Board in person. Any director who fails to attend the meeting due to some reasons and authorizes another director to attend on his/her behalf shall cautiously select a proxy, with specific and clear ~~authorised ~~authorized matters and intent of decision-making, and shall not give carte blanche to his/her proxy; (VI) To focus on matters such as the operating condition of the Company and timely report relevant issues and risks to the Board, and shall not claim exemption from liability on the grounds that they are not familiar with the Company’s business or do not understand the relevant matters; (VII) To actively promote the regulated operation of the Company, timely rectify and report the irregularities of the Company and support the Company to fulfil its social responsibilities; (VIII) Other obligations of diligence as prescribed in the laws, regulations, normative documents and the Articles of Association.	Article ~~116 ~~135 Directors shall comply with laws, regulations and normative documents, the listing rules of the place where the shares of the Company are listed,the Articles of Association, and carry out their duties of diligence as the following: (I) To prudently, earnestly and diligently exercise the rights conferred by the Company so as to ensure that the Company’s business activities meet the requirements of laws, administrative rules, normative documents and the various State economic policies and that the business activities shall not exceed the business scope specified in the business license; (II) To treat all the shareholders fairly; (III) To carefully read the relevant business and financial reports of the Company and keep informed of the operation and management conditions of the Company in a timely manner; (IV) To issue a written acknowledgment on the Company’s periodic reports, and ensure the information disclosed by the Company is true, accurate and complete; (V)~~(IV) ~~To provide the relevant information and materials to the board of supervisors faithfully, and not impeding the board of supervisors or supervisors in exercising their functions and powers; (VI)~~(V) ~~To ensure that they have reserved sufficient time and effort for participating in the Company’s affairs and cautiously judging the risks and gains arising from the resolutions proposed; the directors, in principle, shall attend the meeting of the Board in person. Any director who fails to attend the meeting due to some reasons and authorizes another director to attend on his/her behalf shall cautiously select a proxy, with specific and clear authorised matters and intent of decision-making, and shall not give carte blanche to his/her proxy; (VII)~~(VI)~~ To focus on matters such as the operating condition of the Company and timely report relevant issues and risks to the Board, and shall not claim exemption from liability on the grounds that they are not familiar with the Company’s business or do not understand the relevant matters; (VIII)~~(VII)~~ To actively promote the regulated operation of the Company, timely rectify and report the irregularities of the Company and support the Company to fulfil its social responsibilities; (IX)~~(VIII)~~ Other obligations of diligence as prescribed in the laws, regulations, normative documents and the Articles of Association.

IV-B – 31

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 136	Article 117 A director may resign before expiration of his term of office. The resigning director shall submit a written resignation to the Board of Directors. In the event that the resignation of any director results in the number of members of the Board of Directors to be less than the statutory minimum requirement, the said director shall perform duties as director pursuant to the laws, administrative regulations, normative documents and the Articles of Association until an elected director assumes his/her office. Save for the circumstances referenced in the preceding paragraph, the resignation of a director shall become effective upon submission of his resignation to the Board of Directors.	Article ~~117 ~~136 A director may resign before expiration of his term of office. The resigning director shall submit a written resignation to the Board of Directors. The Board of Directors shall disclose the situation within two days. In the event that the resignation of any director results in the number of members of the Board of Directors to be less than the statutory minimum requirement, the said director shall perform duties as director pursuant to the laws, administrative regulations, normative documents and the Articles of Association until an elected director assumes his/her office. Save for the circumstances referenced in the preceding paragraph, the resignation of a director shall become effective upon submission of his resignation to the Board of Directors.
	Article 138		Any Director shall not act in his own name on behalf of the
			Company or the Board of Directors, without the legitimate
			authorization of this Articles of Association or the Board of
			Directors. Where a Director acts in his own name, in case the
			third party shall reasonably believe he is on behalf of the
			Company or the Board of Directors, the Director shall state
			his position and identity in advance.
Article 146	Article 146	Article 126 The Board of Directors shall be responsible to the shareholders’ general meetings and exercise the following functions and powers: (I) to convene Shareholders’ general meeting and report on its work to the Shareholders’ general meeting; (II) to implement the resolutions of the Shareholders’ general meeting; (III) to decide on the business plans and investment plans of the Company; (IV) to formulate proposals for the Company’s annual financial budget and final accounts; (V) to formulate the Company’s profit distribution proposal and loss recovery proposal; (VI) to formulate proposals for the increase or reduction of the Company’s registered capital and the issue of corporate bonds; (VII) to formulate proposals for the merger, division or dissolution of the Company or change of corporate form; (VIII) to decide on the internal management setup of the Company; (IX) to appoint or dismiss the general manager of the Company; to appoint or dismiss senior vice general manager, vice general manager, chief financial officer and other senior management personnel of the Company based on the nominations of the general manager, and to determine their emoluments;	Article ~~126 1~~46 The Board of Directors shall be responsible to the shareholders’ general meetings and exercise the following functions and powers: (I) to convene Shareholders’ general meeting and report on its work to the Shareholders’ general meeting; (II) to implement the resolutions of the Shareholders’ general meeting; (III) to decide on the business plans and investment plans of the Company; (IV) to formulate proposals for the Company’s annual financial budget and final accounts; (V) to formulate the Company’s profit distribution proposal and loss recovery proposal; (VI) to formulate proposals for the increase or reduction of the Company’s registered capital and the issue and listing of corporate bonds or other securities; (VII) to formulate proposals for ~~the ~~material acquisition, repurchase of the Company’s shares, or merger, division or dissolution of the Company or change of corporate form; (VIII) to determine matters including external investment,
				merger, division or corporate form; external investment,
			dissolution of the Company or change of (VIII) to determine matters including
			acquisition and sale of assets, pledge of assets, external
			guarantee, entrusted financial management, connected
			transactions, and external donations within the authorized
			scope of the shareholders’ general meeting; (IX)~~(VIII)~~ to decide on the internal management setup of the Company;

IV-B – 32

APPENDIX IV-B PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment		After Amendment		(Revision)
		(X) to formulate the Company’s basic management system; (XI) to formulate plans for amendment of the Articles of Association; (XII) other duties and powers provided in laws and regulations, listing rules of the place where the securities of the Company are listed and granted by the shareholders’ general meeting, and specified in the Articles of Association. Resolutions by the Board of Directors on matters referred to in the preceding paragraph, except for sub-paragraphs (VI), (VII) and (XI), may be passed by the affirmative vote of more than half of the Directors. The Board of Directors shall perform its duties in accordance with national laws, administrative regulations, the listing rules of the place where the securities of the Company are listed, the Articles of Association and resolutions approved by the shareholders’ general meeting.	(X)~~(IX) ~~to determine the ~~appoint or dismiss~~appointment or dismissal of the general manager, the secretary to the Board of Directors and other senior management personnel of the Company, and to determine their emoluments, rewards and punishments; to determine the ~~appoint or dismiss ~~appointment or dismissal of ~~senior vice general manager, ~~vice general manager, chief financial officer and other senior management personnel of the Company based on the nominations of the general manager, and to determine their emoluments, rewards and punishments; (XI)~~(X)~~ to formulate the Company’s basic management system; (XII)~~(XI)~~ to formulate plans for amendment of the Articles of Association; (XIII) to manage information disclosures of the Company; (XIV) to propose to the shareholders’ general meeting to hire	determine the		~~or dismiss~~appointment or the secretary to the Board
			or replace the accounting firm that audits for the Company; (XV) to listen to the work report of the general manager and
			inspect the work of managers; (XVI)~~(XII)~~ other duties and powers provided in laws and regulations, listing rules of the place where the securities of the Company are listed and granted by the shareholders’ general meeting, and specified in the Articles of Association. Resolutions by the Board of Directors on matters referred to in the preceding paragraph, except for sub-paragraphs (VI), (VII) and (XII)~~(XI),~~ may be passed by the affirmative vote of more than half of the Directors. The Board of Directors shall perform its duties in accordance with national laws, administrative regulations, the listing rules of the place where the securities of the Company are listed, the Articles of Association and resolutions approved by the shareholders’ general meeting.
Article 147	Article 147		The Board of Directors shall explain to the shareholders’
			general meeting the non-standard audit opinions on the
			financial report of the Company issued by the certified
			accountant.

IV-B – 33

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 148		The Board of Directors shall determine the authorities of
			external investment, acquisition and sale of assets, pledge of
			assets, external guarantees, entrusted financial management,
			connected transactions, and external donations, and establish
			strict review and decision-making procedures; major
			investment projects shall be evaluated by relevant experts and
			professionals and reported to the shareholders’ general
			meeting for approval. Transactions of the Company (the definition of transaction
			shall follow the Sci-Tech Board Listing Rules, which excludes
			the sale of commodities and other transactions related to daily
			operations or the transactions in which the Company gains
			benefits unilaterally) that meet one of the following criteria
			shall be considered by the Board of Directors: (I) the assets involved in the transaction (the higher of book
			value and assessed value, if both exist) account for more than
			10% of the latest audited total assets of the Company; (II) the turnover of the transaction is more than 10% of the
			market value of the Company; (III) the net assets of the subject of the transaction (equity
			interest, for example) for the most recent fiscal year account
			for more than 10% of the market value of the Company; (IV) the operating revenue associated with the subject of the
			transaction (equity interest, for example) for the most recent
			fiscal year accounts for more than 10% of the audited
			operating revenue of the Company for the most recent fiscal
			year and exceeds RMB10 million; (V) the profits generated by the transaction account for more
			than 10% of the audited net profit of the Company for the
			most recent fiscal year and exceed RMB1 million; (VI) the net profits generated by the subject of the transaction
			(equity interest, for example) for the most recent fiscal year
			account for more than 10% of the audited net profits of the
			Company for the most recent fiscal year and exceed RMB1
			million; (VII) transactions (other than the provision of guarantees) with
			related natural persons with a turnover of more than
			RMB300,000; transactions (other than the provision of
			guarantees) with related legal persons with a turnover that
			accounts for no less than 0.1% of the Company’s latest
			audited total assets or market value and exceeds RMB3
			million; and related party transaction subject to the
			consideration of the Board of Directors according to the
			securities regulatory rules of the place where the shares of the
			Company are listed. For related party transactions that may be
			exempted from or waived for consideration and disclosure in
			the form of related party transactions according to relevant
			provisions of laws, regulations, departmental rules and the
			securities regulatory rules of the place where the Company’s
			shares are listed, the Company may be exempted from or
			apply for waiver for consideration and disclosure in the form
			of related party transactions according to relevant provisions; (VIII) external guarantees of the Company.

IV-B – 34

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 150	Article 128 The chairman of the Board of Directors shall exercise the following functions and powers: (I) to preside over the shareholders’ general meetings and to convene and preside over Board meetings; (II) to inspect the implementation of resolutions of the Board of Directors; (III) to sign the securities issued by the Company; (IV) to exercise other functions and powers granted by the Board of Directors or the listing rules of the place where the securities of the Company are listed. Where the chairman is incapable of performing or is not performing his/her duties, a director nominated by more than half of the directors shall perform his/her duties.	Article ~~128 1~~50 The chairman of the Board of Directors shall exercise the following functions and powers: (I) to preside over the shareholders’ general meetings and to convene and preside over Board meetings; (II) to supervise and inspect the implementation of resolutions of the Board of Directors; (III) to sign the securities issued by the Company; (IV) to exercise other functions and powers granted by the Board of Directors or the listing rules of the place where the securities of the Company are listed. Where the chairman is incapable of performing or is not performing his/her duties, a director nominated by more than half of the directors shall perform his/her duties.
Article 151	Article 151	Article 129 Board meetings include regular meetings and extraordinary meetings. Board meetings shall be convened at least four times a year and be called for by the chairman. The notice of the regular meeting of the Board of Directors shall be given not less than 14 days in advance, and the notice of the extraordinary meeting shall be given not less than 5 days in advance. With the consent of the Directors of the Company, the time limit of the above notices may be exempted. However, in the event of emergency for which an extraordinary meeting of the Board of Directors needs to be held as soon as possible, the notice may be given by telephone or other oral means at any time, provided that the convener shall give an explanation at the meeting therefor. An extraordinary board meeting may be held of the occurrence of any of the following: (I) When proposed by more than one tenth of the Shareholders with voting rights; (II) When jointly proposed by more than one third of the Directors; (III) When proposed by the Board of Supervisors; (IV) When the chairman of the Board of Directors deems it necessary; (V) When proposed by more than half of the independent non-executive Directors; (VI) When proposed by the general manager. The chairman shall convene and preside over the board meeting within 10 days of receiving such proposal.	Article 151~~129~~ Board meetings include regular meetings and extraordinary meetings. Board meetings shall be convened at least four times a year and be called for by the chairman. The notice of the regular meeting of the Board of Directors shall be given not less than 14 days in advance, and the notice of the extraordinary meeting shall be given not less than 5 days in advance, in writing, by hand, mail, fax or through other means. ~~With the consent of the Directors of the Company, the~~ ~~time limit of the above notices may be exempted.~~ However, in the event of emergency for which an extraordinary meeting of the Board of Directors needs to be held as soon as possible, the notice may be given by telephone or other oral means at any time, provided that the convener shall give an explanation at the meeting therefor. An extraordinary board meeting may be held of the occurrence of any of the following: (I) When proposed by more than one tenth of the Shareholders with voting rights; (II) When jointly proposed by more than one third of the Directors; (III) When proposed by the Board of Supervisors; (IV) When the chairman of the Board of Directors deems it necessary; (V) When proposed by more than half of the independent non-executive Directors; (VI) When proposed by the general manager. The chairman shall convene and preside over the board meeting within 10 days of receiving such proposal.

IV-B – 35

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 155	Article 133 The Directors shall attend the Board meeting by themselves. If a Director is unable to attend for any reason, he/she may appoint another director to attend the meeting on his/her behalf by a written power of attorney specifying the scope of authorization. The Director attending the meeting on other’s behalf shall only exercise the rights of a Director within the scope of authorization. If a Director fails to attend a board meeting or appoint a representative to attend on his behalf, such Director shall be deemed to have waived his right to vote at such meeting.	Article ~~133 ~~155 The Directors shall attend the Board meeting by themselves. If a Director is unable to attend for any reason, he/she may appoint another director to attend the meeting on his/her behalf by a written power of attorney specifying the proxy’s name, entrusted matters, scope of authorization and validity period, which shall be signed or sealed by the entrusting party. The Director attending the meeting on other’s behalf shall only exercise the rights of a Director within the scope of authorization. If a Director fails to attend a board meeting or appoint a representative to attend on his behalf, such Director shall be deemed to have waived his right to vote at such meeting.
Article 156		Article 134 The Board of Directors and any committee thereof shall record the decisions on the matters discussed at the meeting as minutes. Minutes of board meetings and meetings of board committees should record in sufficient detail the matters considered and decisions reached, including any concerns raised by directors or dissenting views expressed. Draft and final versions of minutes should be sent to all directors for their comment and records respectively, within a reasonable time after the board meeting is held. The Directors and recorder attending the meeting shall sign the minutes. The minutes of meetings shall be kept for at least 10 years. Directors shall be liable for the resolutions of the Board of Directors. If the resolutions of the Board of Directors violate the laws, administrative regulations or the Articles of Association, and the Company suffers a material loss as a result thereof, the Directors participating in the resolutions are liable to the Company for the losses. However, Directors may be exempted from such liability if it is verified that such Director has stated his objection when voting and the same was recorded in the minutes at the Board meeting. Any opinion stated by the independent non-executive Directors shall be recorded in the Board resolutions.	Article ~~134 ~~156 The Board of Directors and any committee thereof shall record the decisions on the matters discussed at the meeting as minutes. Minutes of board meetings and meetings of board committees should record in sufficient detail the matters considered and decisions reached, including any concerns raised by directors or dissenting views expressed. Draft and final versions of minutes should be sent to all directors for their comment and records respectively, within a reasonable time after the board meeting is held. The Directors and recorder attending the meeting shall sign the minutes. The minutes of meetings shall be kept for at least 10 years. Directors shall be liable for the resolutions of the Board of Directors. If the resolutions of the Board of Directors violate the laws, administrative regulations or the Articles of Association, and the Company suffers a material loss as a result thereof, the Directors participating in the resolutions are liable to the Company for the losses. However, Directors may be exempted from such liability if it is verified that such Director has stated his objection when voting and the same was recorded in the minutes at the Board meeting. Any opinion stated by the independent non-executive Directors shall be recorded in the Board resolutions. Minutes of Board meetings shall include the following
			information: (I) date, venue and name of the convener of the meeting; (II) names of Directors attending the meeting in person and
			Directors (proxy) who has been appointed by other Directors
			to attend the meeting; (III) agenda of the meeting; (IV) summary of opinions expressed by the Directors; (V) the manner and result of voting of each resolution (with
			the number of votes for, against and abstained recorded

IV-B – 36

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 157	Article 135 The Board of Directors may set up special committees such as Audit Committee, Remuneration and Assessment Committee, Nomination Committee and Strategy Committee, and formulate corresponding implementation rules to stipulate the main responsibilities, decision-making procedures and rules of procedures of each special committee. The Board of Directors shall be responsible for amendment and interpretation of the implementation rules of each special committee.	Article ~~135 ~~157 The Board of Directors may set up special committees such as Audit Committee, Remuneration and Assessment Committee, Nomination Committee and Strategy Committee, and formulate corresponding implementation rules to stipulate the main responsibilities, decision-making procedures and rules of procedures of each special committee. The Board of Directors shall be responsible for amendment and interpretation of the implementation rules of each special committee. The special committees are responsible to the Board of
			Directors, they shall perform duties in accordance with the
			Articles of Association and the authorization of the Board of
			Directors, their proposals shall be submitted to the Board of
			Directors for consideration and approval and the members
			thereof are all directors. Among them, the Audit Committee,
			the Nomination Committee, the Remuneration and Assessment
			Committee shall have a majority of independent non-executive
			directors, and the convener must be an independent non-
			executive director. The convener of the Audit Committee shall
			be an accounting professional. The Board of Directors are
			responsible for formulating the regulations of each special
			committee to standardize operations of the special committees.
	Article 159	Article 137 There shall be a secretary of the Board. The secretary of the Board of Directors is a member of senior management of the Company.	Article ~~137 1~~59 There shall be a secretary ~~of ~~to the Board, responsible for preparing general meetings and Board meetings
			of the Company, keeping documents and managing
			shareholders’ information, and handling information disclosure
			matters. The secretary ~~of t~~o the Board of Directors is a member of senior management of the Company. The secretary to the Board of Directors shall abide by the
			relevant provisions of laws, administrative regulations,
			departmental rules and the Articles of Association.
	Article 162	Article 140 The Company shall have one general manager to be appointed or dismissed by the Board of Directors. The Company shall have several deputy general managers to be appointed or dismissed by the Board of Directors. The Board of Directors shall have the right to appoint members of the Board of Directors to serve concurrently as general manager. The term of office of the general manager shall be 3 years and the general manager may be reappointed upon the expiration of his/her term.	Article ~~140 1~~62 The Company shall have one general manager to be appointed or dismissed by the Board of Directors. The Company shall have several deputy general managers to be appointed or dismissed by the Board of Directors. The Board of Directors shall have the right to appoint members of the Board of Directors to serve concurrently as general manager. The term of office of the general manager shall be 3 years and the general manager may be reappointed upon the expiration of his/her term. The general manager, deputy general managers, the chief
			financial officer and the secretary to the Board of Directors
			are the senior management of the Company.
	Article 163		The provisions of Article 134 herein regarding the duty of
			loyalty of Directors and of Article 135 (IV), (V) and (IX)
			regarding the duty of diligence shall also apply to the senior
			management.
Article 164			Those who hold administrative positions other than director or
			supervisor in the Company’s controlling shareholder shall not
			serve as senior management of the Company. Senior management of the Company shall be paid by the
			Company only and shall not be paid by the controlling

IV-B – 37

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 168		The general manager shall formulate the working rules of the
			general manager and submit it to the Board of Directors for
			approval before implementation. The working rules of the general manager shall include the
			following: (I) conditions, procedures and participants of the general
			manager’s meeting; (II) the responsibilities of the general manager and the
			specific duties of other senior management personnel and their
			division of labor; (III) the use of the Company’s funds and assets, the authority
			to enter into major contracts, and the system of reporting to
			the Board of Directors and the Supervisory Committee; (IV) other matters that the Board of Directors believes
			necessary.
	Article 169		Managers may resign before the expiration of his or her term
			of office. The specific procedures and methods regarding the
			resignation of managers are stipulated in the labor contract
			between managers and the Company.
	Article 170		The senior management of the Company shall faithfully
			perform their duties to safeguard the best interests of the
			Company and all shareholders. If the senior management of
			the Company fails to faithfully perform their duties or violates
			their duty of good faith, and causes damage to the interests of
			the Company and the shareholders of public shares, they shall
			be liable for compensation according to law.
	Article 175	Article 148 The meetings of the Supervisory Committee consist of regular meetings and extraordinary meetings. Regular meetings of the Supervisory Committee shall be convened at least once every six months and be convened and presided by its chairman. Supervisors may propose to convene an extraordinary meeting of the Supervisory Committee. A Supervisor shall be jointly elected by more than half of the Supervisors to convene and preside over the meetings of Supervisory Committee when the chairman fails or refuses to perform his/her duties.	Article ~~148 1~~75 The meetings of the Supervisory Committee consist of regular meetings and extraordinary meetings. Regular meetings of the Supervisory Committee shall be convened at least once every six months and be convened and presided by its chairman. Supervisors may propose to convene an extraordinary meeting of the Supervisory Committee. A Supervisor shall be jointly elected by more than half of the Supervisors to convene and preside over the meetings of Supervisory Committee when the chairman fails or refuses to perform his/her duties. The notice of the regular meeting shall be given not less than
			14 days in advance, and the notice of the extraordinary
			meeting shall be given not less than 5 days in advance, in
			writing, by hand, mail, fax or through other means. However,
			in the event of emergency for which an extraordinary meeting
			needs to be held as soon as possible, the notice may be given
			by telephone or other oral means at any time, provided that
			the convener shall give an explanation at the meeting therefor.

IV-B – 38

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 176	Article 149 The Supervisory Committee shall be accountable to the shareholders’ general meeting and shall exercise the following functions and powers in accordance with the law: (I) to review the Company’s financial position; (II) to supervise the Directors, the general manager and other senior management in their performance of their duties of the Company and to propose the removal of Directors and senior management who have violated laws, administrative regulations, listing rules of the place(s) where the Shares of the Company are listed and the Articles of Association or resolutions of general meetings; (III) when the acts of a Director, general manager and other senior management are detrimental to the Company’s interests, to require him/her to correct such acts; (IV) to verify financial information such as financial reports, business reports, profit distribution plans that the Board of Directors intents to submit to the shareholders’ general meeting and, if in doubt, a registered accountant or practicing auditor shall be appointed in the name of the Company to assist in reviewing such information; (V) to propose the convening of extraordinary Shareholders’ general meetings and to convene and preside over Shareholders’ general meetings when the Board fails to perform the duty of convening and presiding over Shareholders’ general meetings; (VI) to make proposals to the shareholders’ general meeting; (VII) to negotiate with Directors on behalf of the Company or to initiate litigation against Directors, the general manager, and other senior management members in accordance with the law and the Articles of Association of the Company; and (VIII) to exercise other functions and powers stipulated in the Articles of Association. Supervisors may attend board meetings and make enquiries or proposals in respect of Board resolutions. Supervisors shall ensure the truthfulness, accuracy and completeness of the information disclosed by the Company.	Article ~~149~~ ~~1~~76 The Supervisory Committee shall be accountable to the shareholders’ general meeting and shall exercise the following functions and powers in accordance with the law: (I) to review periodic reports prepared by the Board of
			Directors and issue a written opinion; (II)~~(I) ~~to review the Company’s financial position; (III)~~(II) ~~to supervise the Directors, the general manager and other senior management in their performance of their duties of the Company and to propose the removal of Directors and senior management who have violated laws, administrative regulations, listing rules of the place(s) where the Shares of the Company are listed and the Articles of Association or resolutions of general meetings; (IV)~~(III)~~ when the acts of a Director, general manager and other senior management are detrimental to the Company’s interests, to require him/her to correct such acts; (V)~~(IV)~~ to verify financial information such as financial reports, business reports, profit distribution plans that the Board of Directors intents to submit to the shareholders’ general meeting and, if in doubt, a registered accountant or practicing auditor shall be appointed in the name of the Company to assist in reviewing such information; (VI)~~(V)~~ to propose the convening of extraordinary Shareholders’ general meetings and to convene and preside over Shareholders’ general meetings when the Board fails to perform the duty of convening and presiding over Shareholders’ general meetings; (VII)~~(VI)~~ to make proposals to the shareholders’ general meeting; (VIII)~~(VII)~~ to negotiate with Directors on behalf of the Company or to initiate litigation against Directors, the general manager, and other senior management members in accordance with the law and the Articles of Association of the Company; and (IX) to investigate abnormalities with the Company’s
			operations; when necessary, to hire professional institutions
			like an accounting firm or a lawyer’s firm to give assistance; (X)~~(VIII) ~~to exercise other functions and powers stipulated in the Articles of Association. Supervisors may attend board meetings and make enquiries or proposals in respect of Board resolutions. Supervisors shall ensure the truthfulness, accuracy and completeness of the information disclosed by the Company, and shall issue written acknowledgment of the periodic
			reports.

IV-B – 39

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 181		The notice of the meetings of the Supervisory Committee
			shall include the following contents: (I) date, venue and duration of the meeting; (II) purposes and topics to be discussed; (III) the date of issuing the notice.
	Article 182	Article 154 Supervisors shall faithfully perform their supervisory duties in accordance with laws, administrative regulations, and the provisions of the Articles of Association.	Article ~~154 ~~182 Supervisors shall faithfully perform their supervisory duties in accordance with laws, administrative regulations, and the provisions of the Articles of Association. Supervisors shall abide by laws, administrative regulations and
			the Articles of Association, shall have duties of loyalty and
			diligence to the Company, and shall not use their position to
			accept bribes or other illegal income, or embezzle the
			Company’s property.
Article 183	Article 183	Article 155 No one shall be a director, supervisor, general manager, or other senior management officer of the Company under any of the following circumstances: (I) A person without or with limited capacity for civil conduct; (II) A person who has been sentenced for corruption, bribery, infringement of property, misappropriation of property or damaging the social economic order, where less than 5 years have elapsed since the sentence was served, or who has been deprived of his political rights due to criminal offense, where less than 5 years have elapsed since the sentence was served; (III) A person who is a Director, factory Director or manager of a bankrupt and liquidated company or enterprise due to poor operation and management whereby such person is personally liable for the insolvency of such company or enterprise, and where less than 3 years have elapsed since the date of completion of the insolvency and liquidation of such company or enterprise; (IV) A person who is a former legal representative of a company or enterprise the business license of which was revoked and ordered to close down due to violation of law and who is personally liable for such violation, where less than 3 years have elapsed since the date of the revocation of business license of such company or enterprise; (V) A person who has a relatively large amount of debts which have become overdue; (VI) A person who is currently under investigation by the judicial authorities for violation of criminal law, and the legal procedures are pending; (VII) A person who, according to law and administrative regulations, is not permitted to be the leader of an enterprise; (VIII) A person who is not a natural person; (IX) A person who has been convicted by the relevant competent authority for violation of relevant securities regulations and such conviction involves a finding that such person has acted fraudulently or dishonestly, where less than 5 years have elapsed since the date of such conviction; (X) Other persons stipulated in the laws, administrative regulations and the listing rules or the relevant laws and regulations of the place where the Securities of the Company are listed. In the case of the election, appointment of directors and supervisors or employment of senior management which violates the above provisions, the election, appointment or employment shall be null and void.	Article ~~155 ~~183 No one shall be a director, supervisor, general manager, or other senior management officer of the Company under any of the following circumstances: (I) A person without or with limited capacity for civil conduct; (II) A person who has been sentenced for corruption, bribery, infringement of property, misappropriation of property or damaging the social economic order, where less than 5 years have elapsed since the sentence was served, or who has been deprived of his political rights due to criminal offense, where less than 5 years have elapsed since the sentence was served; (III) A person who is a Director, factory Director or manager of a bankrupt and liquidated company or enterprise due to poor operation and management whereby such person is personally liable for the insolvency of such company or enterprise, and where less than 3 years have elapsed since the date of completion of the insolvency and liquidation of such company or enterprise; (IV) A person who is a former legal representative of a company or enterprise the business license of which was revoked and ordered to close down due to violation of law and who is personally liable for such violation, where less than 3 years have elapsed since the date of the revocation of business license of such company or enterprise; (V) A person who has a relatively large amount of debts which have become overdue; (VI) A person who is currently under investigation by the judicial authorities for violation of criminal law, and the legal procedures are pending; (VII) A person who, according to law and administrative regulations, is not permitted to be the leader of an enterprise; (VIII) A person who is not a natural person; (IX) A person who has been convicted by the relevant competent authority for violation of relevant securities regulations and such conviction involves a finding that such person has acted fraudulently or dishonestly, where less than 5 years have elapsed since the date of such conviction; (X) A person subject to prohibition of entry into the securities
			market by the CSRC which has not expired;

IV-B – 40

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

	No.	Before Amendment	After Amendment (Revision)
		Any director, supervisor or senior management officer who falls under the circumstances as set out in Paragraph (I) of this Article during his/her term of office shall be removed by the Company.	(XI)~~(X) ~~Other persons stipulated in the laws, administrative regulations and the listing rules or the relevant laws and regulations of the place where the Securities of the Company are listed. In the case of the election, appointment of directors and supervisors or employment of senior management which violates the above provisions, the election, appointment or employment shall be null and void. Any director, supervisor or senior management officer who falls under the circumstances as set out in Paragraph (I) of this Article during his/her term of office shall be removed by the Company.
	Article 190	Article 162 Except in circumstances otherwise stipulated in the Article 56 of this Articles of Association, liabilities of a Director, Supervisor, general manager and other senior management arising from the violation of a specified duty may be released by informed Shareholders in general meeting.	Article ~~162 1~~90 Except in circumstances otherwise stipulated in the Article ~~56 ~~58 of this Articles of Association, liabilities of a Director, Supervisor, general manager and other senior management arising from the violation of a specified duty may be released by informed Shareholders in general meeting.
	Article 196	Article 168 The Company shall not be forced to perform the loan guarantee it provided in breach of sub-paragraph (I) of Article 166, except in the following circumstances: (I) the loan provider was not informed at the time that the loan was provided to the connected persons of the Directors, Supervisors, general manager and other senior management members of the Company or its parent company; (II) the guarantee provided by the Company has been sold by the loan provider lawfully to a goodwill buyer.	Article ~~168 ~~196 The Company shall not be forced to perform the loan guarantee it provided in breach of sub-paragraph (I) of Article ~~1661~~94, except in the following circumstances: (I) the loan provider was not informed at the time that the loan was provided to the connected persons of the Directors, Supervisors, general manager and other senior management members of the Company or its parent company; (II) the guarantee provided by the Company has been sold by the loan provider lawfully to a goodwill buyer.
Article 199	Article 199	Article 171 The Company shall enter into written contracts with each of its Director, Supervisor and senior management, of which shall include the following provisions at least: (I) An undertaking by the director, supervisor and senior management to the Company to observe Company Law, the Special Regulations, the Articles of Association, the Codes on Takeover and Mergers reviewed by the Securities and Futures Commission of Hong Kong, which is amended from time to time, the Codes on Share Repurchases and other rules of the Hong Kong Stock Exchange, and an agreement that the Company shall have the remedies provided in the Articles of Association, and that neither the contract nor his office is capable of assignment; (II) An undertaking by the director, supervisor or senior management to the Company on behalf of each shareholder to observe and perform his/her obligations for its shareholders required by the Articles of Association; (III) An arbitration clause as provided in Article 214 hereof.	Article ~~171~~ 199 The Company shall enter into written contracts with each of its Director, Supervisor and senior management, of which shall include the following provisions at least: (I) An undertaking by the director, supervisor and senior management to the Company to observe Company Law, the Special Regulations, the Articles of Association, the Codes on Takeover and Mergers reviewed by the Securities and Futures Commission of Hong Kong, which is amended from time to time, the Codes on Share Repurchases and other rules of the Hong Kong Stock Exchange, and an agreement that the Company shall have the remedies provided in the Articles of Association, and that neither the contract nor his office is capable of assignment; (II) An undertaking by the director, supervisor or senior management to the Company on behalf of each shareholder to observe and perform his/her obligations for its shareholders required by the Articles of Association; (III) An arbitration clause as provided in Article ~~214 ~~248 hereof.

IV-B – 41

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 201	Article 173 The contracts entered into between the Company and its Directors or Supervisors concerning emoluments shall prescribe that in the event that the Company is being acquired, the Company’s directors and supervisors shall, subject to the prior approval of shareholders in a general meeting, have the right to receive compensation or other payment in respect to his loss of office or retirement. For the purposes of the preceding paragraph, the acquisition of the Company includes any of the following: (I) An offer made by any person to all shareholders; or (II) An offer made by any person such that the offeror will become the controlling shareholder. The term “controlling shareholder” has the same meaning as defined in the Article 57 of this Articles of Association. If the relevant Director or Supervisor does not comply with this Article, any sum received by him/her shall belong to those persons who have sold their shares as a result of the acceptance of such offer, and the expenses incurred in distributing that sum on a pro rata basis among those persons shall be borne by the relevant Director or Supervisor and shall not be deducted from the distributed sum.	Article ~~173 ~~201 The contracts entered into between the Company and its Directors or Supervisors concerning emoluments shall prescribe that in the event that the Company is being acquired, the Company’s directors and supervisors shall, subject to the prior approval of shareholders in a general meeting, have the right to receive compensation or other payment in respect to his loss of office or retirement. For the purposes of the preceding paragraph, the acquisition of the Company includes any of the following: (I) An offer made by any person to all shareholders; or (II) An offer made by any person such that the offeror will become the controlling shareholder. The term “controlling shareholder” has the same meaning as defined in the Article ~~57 6~~1 of this Articles of Association. If the relevant Director or Supervisor does not comply with this Article, any sum received by him/her shall belong to those persons who have sold their shares as a result of the acceptance of such offer, and the expenses incurred in distributing that sum on a pro rata basis among those persons shall be borne by the relevant Director or Supervisor and shall not be deducted from the distributed sum.
Article 208	Article 208	Article 180 The Company shall publish its financial reports twice in each accounting year. An interim financial report shall be published within 60 days after the end of the first six months of each accounting year, while an annual financial report shall be published within 120 days after the end of each accounting year. Where the securities regulatory authorities at, and listing rules of, the place where the shares of the Company are listed provide otherwise, such provisions shall prevail.	Article ~~180 2~~08 The Company shall publish its financial reports twice in each accounting year. An interim ~~financial~~ report shall be submitted to the local branches of the CSRC and the stock exchange(s) and published within 60 days after the end of the first six months of each accounting year, while an annual ~~financial~~ report shall be submitted to the local branches of the CSRC and the stock exchange(s) and published within 120 days after the end of each accounting year. The aforesaid annual and interim reports shall be prepared in accordance with relevant laws, administrative regulations, and regulations of the CSRC and the SSE. Where the securities regulatory authorities at, and listing rules of, the place where the shares of the Company are listed provide otherwise, such provisions shall prevail.	financial

IV-B – 42

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 213	Article 185 When the Company distributes each year’s profit after tax, the Company shall allocate 10% of the after-tax profits as the statutory reserve fund of the Company. Such allocations may be stopped when the statutory reserve fund of the Company has accumulated to above 50% of the registered capital of the Company. If the statutory reserve fund of the Company is insufficient to make up for the losses of the preceding year, the profits of the current year shall first be used to make up for the said losses before any statutory reserve fund is allocated as per above. After the Company has made allocations to the statutory reserve fund from its after-tax profits, it may, upon passing a resolution at a shareholders’ general meeting, make further allocations from its after-tax profits to the discretionary reserve fund. If the shareholder’s general meeting or the Board of Directors has, in violation of the provisions in the preceding paragraphs, distributed profits to shareholders before the Company recovered the losses and allocated statutory reserve fund, the profits thus distributed shall be returned to the Company. The Company shall not be entitled to any distribution of profits in respect of shares held by it.	Article ~~185 ~~213 When the Company distributes each year’s profit after tax, the Company shall allocate 10% of the after- tax profits as the statutory reserve fund of the Company. Such allocations may be stopped when the statutory reserve fund of the Company has accumulated to above 50% of the registered capital of the Company. If the statutory reserve fund of the Company is insufficient to make up for the losses of the preceding year, the profits of the current year shall first be used to make up for the said losses before any statutory reserve fund is allocated as per above. After the Company has made allocations to the statutory reserve fund from its after-tax profits, it may, upon passing a resolution at a shareholders’ general meeting, make further allocations from its after-tax profits to the discretionary reserve fund. The after-tax profit of the Company after recovering the losses
			and allocating statutory reserve fund shall be distributed to the
			shareholders on a pro-rata basis in accordance with their
			shareholdings, except for the non-pro rata distributions as
			required by the Articles of Association. If the shareholder’s general meeting or the Board of Directors has, in violation of the provisions in the preceding paragraphs, distributed profits to shareholders before the Company recovered the losses and allocated statutory reserve fund, the profits thus distributed shall be returned to the Company. The Company shall not be entitled to any distribution of profits in respect of shares held by it.
	Article 214		The Company’s profit distribution policy: (I) Principles of profit distribution The Company’s profit distribution policy shall be consistent
			and stable, and shall take into account the long-term interests
			of the Company, the overall interests of all shareholders and
			the sustainable development of the Company, and when the
			Company has the conditions for cash dividends, priority shall
			be given to the distribution of profits in the form of cash
			dividends. (II) Form of profit distribution The Company distributes dividends in cash, stock or a
			combination of cash and stock or in any other manner in
			compliance with laws and regulations. Profit distribution shall
			not exceed the cumulative distributable profit, nor damage the
			Company’s sustainable operation ability. Provided that profits
			are recorded in a given year and there are no major
			investment plans or major cash expenditures, the Company
			shall give priority to dividend distribution in cash.

IV-B – 43

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
			(III) Conditions for and proportions of profit distribution 1. Intervals of distributing dividends in cash The Company shall, in principle, distribute profits once a
			year. If conditions permit, the Board of Directors may propose
			an interim dividend distribution based on the Company’s then
			profit size, cash flow status, development stage and capital
			requirements. 2. Specific conditions for and proportions of cash dividends Conditions for cash dividends are: (1) the Company’s distributable profit for the year (that is,
			after-tax profit remaining after making up losses and
			withdrawing reserves) and the accumulated undistributed
			profit are positive, the cash flow is sufficient, and distributing
			dividend in cash will not affect the Company’s subsequent
			sustainable operation; (2) the auditor has issued a standard unqualified audit report
			on the Company’s financial reports for the year; (3) the Company has no major investment plans or major cash
			outlays or other matters. The major investment plans or major cash outlays above refer
			to one of the following circumstances: The cumulative expenditure of the Company’s proposed
			external investment, acquisition of assets or purchase of
			equipment within the next twelve months reaches or exceeds
			30% of the Company’s latest audited net assets; The cumulative expenditure of the Company’s proposed
			external investment, acquisition of assets or purchase of
			equipment within the next twelve months reaches or exceeds
			10% of the Company’s latest audited total assets. 3. Differentiated cash dividend policy The Board of Directors shall take into account the
			characteristics of the industry in which it operates, its stage
			of development, its own business model, its level of
			profitability and whether it has major capital expenditure
			arrangements, differentiate the following circumstances, and
			propose differentiated cash dividend policies in accordance
			with the procedures set out in the Articles of Association:~~.~~ (1) if the Company is in a stage of maturity and has no major
			capital expenditure arrangements, the minimum proportion of
			cash dividends in the profit distribution shall be 80%; (2) if the Company is in a stage of maturity and has major
			capital expenditure arrangements, the minimum proportion of
			cash dividends in the profit distribution shall be 40%;

IV-B – 44

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
			(3) if the Company is in a stage of growth and has major
			capital expenditure arrangements, the minimum proportion of
			cash dividends in the profit distribution shall be 20%. If the Company’s development stage is hard to distinguish but
			it has major capital expenditure arrangements, the provisions
			of the preceding paragraph shall apply. The specific stage of
			the Company at the time of actual profit distribution shall be
			determined by the Board of Directors according to the specific
			circumstances. 4. Specific conditions for the distribution of stock dividends Where the Company is in a sound operating condition, and
			the Board of Directors considers that the stock price of the
			Company does not reflect its scale of share capital and
			distributing dividend in shares will be in the interests of all
			shareholders of the Company as a whole, the Company may
			propose the distribution plan of dividend in shares upon
			fulfilment of the above conditions concerning cash dividends.
			When the Company adopts stock dividends for profit
			distribution, it should be carried out on the premise of giving
			shareholders a reasonable cash dividend return and
			maintaining an appropriate share capital scale, with
			comprehensive consideration of the actual and reasonable
			factors such as the growth of the Company and the dilution of
			net assets per share. (IV) Decision-making mechanism of profit distribution (1)~~. ~~While establishing the specific plan of cash dividend, the
			Board of Directors shall study and identify with caution the
			timing, conditions and minimum proportion, conditions for
			adjustment and requirements for decision-making procedures,
			etc involved in implementing the distribution of cash
			dividends. Independent non-executive directors shall express
			their independent opinions thereon. Independent non-executive
			directors may collect opinions from minority shareholders for
			putting forward a profit distribution proposal which can be
			directly submitted to the Board of Directors for consideration.
			(2) The profit distribution plan considered and approved by
			the Board of Directors and the Supervisory Committee shall
			be submitted to the shareholders’ general meeting of
			shareholders for consideration. Prior to the consideration of
			the specific plan of cash dividend in the shareholders’ general
			meeting, the Company shall also take the initiative to
			communicate and share information with shareholders, in
			particular minority shareholders, by way of various channels
			(including but not limited to telephone, fax, mail ~~and,~~ field visits, etc.) so as to take the opinions and demands of
			minority shareholders into full consideration and respond
			timely to the concerns of minority shareholders.

IV-B – 45

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
			(3) If the Board of Directors does not make a cash profit
			distribution plan, or if the cash profit distribution plan made
			by the Board of Directors does not comply with the Articles
			of Association, the Board of Directors shall disclose in detail
			the reasons and the use of the funds retained by the Company
			that are not used for dividend distribution in the periodic
			reports, and the independent non-executive directors shall
			express their independent opinions thereon. (V) Adjusting mechanism for profit distribution In the event of force majeure such as war, natural disasters,
			or new laws, regulations or regulatory documents promulgated
			by the relevant departments of the state on the profit
			distribution policies of listed companies, or changes in the
			Company’s external operating environment (such as the
			adjustment of national policies and regulations) that have a
			significant impact on the Company’s production and operation,
			or major changes in the Company’s operating conditions, or if
			it is necessary to adjust the Company’s profit distribution
			policy from the perspective of protecting shareholders’ rights
			or maintaining the normal and sustainable development of the
			Company, the Company may adjust the profit distribution
			policy. For adjustment of the profit distribution policy, the Board of
			Directors shall make a special discussion, demonstrate in
			detail the reasons for the adjustment, and form a written
			demonstration report, on which the independent non-executive
			directors and the Supervisory Committee have expressed their
			audit opinions. When considering changes or adjustments to
			the profit distribution policies, arrangements shall be made at
			the shareholders’ general meeting for the convenient
			participation of minority investors by leveraging the trading
			system of the stock exchange and the online system, and
			those changes or adjustments shall be approved by more than
			two-thirds of the shareholders present at the general meeting
			holding shares carrying voting rights.
	Article 215		After the shareholders’ general meeting has resolved on the
			profit distribution plan, the Board of Directors shall complete
			the distribution of dividends (or shares) within two months
			after the shareholders’ general meeting.
	Article 217		The Company implements an internal audit system and has
			full-time auditors to conduct internal audit and supervision of
			the Company’s financial receipts and expenditures and
			economic activities.
Article 218			The responsibilities of the Company’s internal audit system
			and auditors shall be implemented upon approval by the
			Board of Directors. The head of audit is responsible to and

IV-B – 46

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
	Article 219	Article 187 The Company shall appoint an independent PRC qualified accounting firm to audit the Company’s annual financial report and to review other financial reports. The first accounting firm of the Company may be appointed by the inaugural meeting prior to the first annual general meeting and the accounting firm so appointed shall hold office until the conclusion of the first annual general meeting. The Board of Directors shall exercise such powers while the inaugural meeting fails to exercise the powers prescribed in the preceding paragraph.	Article ~~187 2~~19 The Company shall appoint an independent ~~PRC~~ ~~qualified~~ accounting firm which complies with the Securities Law and the relevant national regulations to audit the Company’s annual financial report, ~~and to ~~review other financial reports, and conduct verification of net assets and other related consulting services. The first accounting firm of the Company may be appointed by the inaugural meeting prior to the first annual general meeting and the accounting firm so appointed shall hold office until the conclusion of the first annual general meeting. The Board of Directors shall exercise such powers while the inaugural meeting fails to exercise the powers prescribed in the preceding paragraph.
	Article 220	Article 188 The term of appointment of an accounting firm appointed by the Company shall be between the conclusion of the annual general meeting of the Company and the conclusion of the next annual general meeting and the term of appointment may be renewable upon expiry of the term of appointment.	Article ~~188 ~~220 The term of appointment of an accounting firm appointed by the Company shall be one year from ~~between ~~the conclusion of the annual general meeting of the Company to~~and~~ the conclusion of the next annual general meeting and the term of appointment may be renewable upon expiry of the term of appointment. The appointment of an accounting firm by the Company must
			be decided by the shareholders’ general meeting, and the
			Board of Directors shall not appoint an accounting firm before
			the decision of the shareholders’ general meeting.
	Article 221	Article 189 An accounting firm appointed by the Company shall have the following rights: (I) the right to the access to the accounts books, records or vouchers of the Company at any time and the right to require directors, general manager or other senior management of the Company to provide the relevant information and explanations; (II) the right to require the Company to take all reasonable measures to obtain from its subsidiaries the information and explanations necessary for the accounting firm to perform its duties; and (III) the right to attend shareholders’ general meeting, to receive a notice or other information concerning any meetings which shareholders have a right to receive, and to be heard at any shareholders’ general meetings on any matter which relates to it as the accounting firm of the Company.	Article ~~189~~ 221 An accounting firm appointed by the Company shall have the following rights: (I) the right to the access to the accounts books, records or vouchers of the Company at any time and the right to require directors, general manager or other senior management of the Company to provide the relevant information and explanations; (II) the right to require the Company to take all reasonable measures to obtain from its subsidiaries the information and explanations necessary for the accounting firm to perform its duties; and (III) the right to attend shareholders’ general meeting, to receive a notice or other information concerning any meetings which shareholders have a right to receive, and to be heard at any shareholders’ general meetings on any matter which relates to it as the accounting firm of the Company. (IV) the right to have the Company ensure that it will provide
			true and complete accounting documents, accounting books,
			financial reports and other accounting information to the
			accounting firm appointed, and no refusal, concealment or
			misrepresentation.

IV-B – 47

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 226	Article 226	Article 194 If the Company proposes to remove the accounting firm or not to renew the appointment thereof, it should notify the accounting firm 30 days in advance, and the latter has the right to state its opinions to the shareholders’ general meeting. If the accounting firm resigns, it shall make clear to the shareholders’ general meeting whether there is any impropriety on the part of the Company. The accounting firm may resign from its office by depositing the written notice of resignation at the legal address of the Company. The notice shall become effective on the date when it is placed at the Company’s legal address or on such later date as may be stated in the notice. The notice shall contain the following statements: (I) A statement to the effect that there are no circumstances connected with its resignation that it considers must be brought to the attention of the shareholders or creditors of the Company; or (II) A statement of any such circumstances that should be explained. The Company shall, within 14 days of the receipt of the written notice referred to in preceding paragraph, send a copy of the notice to the relevant competent authority. If the notice contains a statement under sub-paragraph (II) of the preceding paragraph, a copy of such statement shall be placed at the Company for shareholders’ inspection. The Company shall also send a copy of such statement to every shareholder that is entitled to receive the financial report of the Company at the address recorded in the register of members. If the accounting firm’s notice of resignation contains a statement under sub-paragraph (II) of the second paragraph of this Article, the accounting firm may request the Board of Directors to convene an extraordinary general meeting for the purpose of giving an explanation of the circumstances in connection with its resignation.	Article ~~194 ~~226 If the Company proposes to remove the accounting firm or not to renew the appointment thereof, it should notify the accounting firm 30 days in advance, and the latter has the right to state its opinions to the shareholders’ general meeting. If the accounting firm resigns, it shall make clear to the shareholders’ general meeting whether there is any impropriety on the part of the Company. The accounting firm may resign from its office by depositing the written notice of resignation at the legal address of the Company. The notice shall become effective on the date when it is placed at the Company’s legal address or on such later date as may be stated in the notice. The notice shall contain the following statements: (I) A statement to the effect that there are no circumstances connected with its resignation that it considers must be brought to the attention of the shareholders or creditors of the Company; or (II) A statement of any such circumstances that should be explained. The Company shall, within 14 days of the receipt of the written notice referred to in preceding paragraph, send a copy of the notice to the relevant competent authority. If the notice contains a statement under sub-paragraph (II) of the preceding paragraph, a copy of such statement shall be placed at the Company for shareholders’ inspection. The Company shall also send a copy of such statement to every shareholder that is entitled to receive the financial report of the Company at the address recorded in the register of members. If the accounting firm’s notice of resignation contains a statement under sub-paragraph (II) of the second paragraph of this Article, the accounting firm may request the Board of Directors to convene an extraordinary general meeting for the purpose of giving an explanation of the circumstances in connection with its resignation.

IV-B – 48

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 229	Article 229	Article 197 In the event of a merger, the parties to the merger shall enter into a merger agreement, and prepare balance sheets and asset list. The Company shall notify its creditors within 10 days from the date of on which the resolution in favour of the merger is adopted and shall publish an announcement in a newspaper within 30 days from the date of such resolution. A creditor has the right to require the Company to repay its debts or to provide a corresponding guarantee for such debts within 30 days from the date it receives the relevant notice or, in the case of a creditor who did not receive such notice, within 45 days from the date of the relevant announcement. Upon the merger, claims and debts of each of the merged parties shall be assumed by the company which survives the merger or the newly established company resulting from the merger. In the event of a division of the Company, its properties shall be divided up accordingly. In the event of a division, the parties to the division shall enter into a division agreement, and prepare balance sheets and asset list. The Company shall notify its creditors within 10 days from the date on which a resolution is adopted in favour of the division and shall publish an announcement in a newspaper within 30 days from the date of such resolution. Debts incurred by the Company before its division shall be borne by the companies after the division according to the agreement reached.	Article ~~197 2~~29 In the event of a merger, the parties to the merger shall enter into a merger agreement, and prepare balance sheets and asset list. The Company shall notify its creditors within 10 days from the date of on which the resolution in favour of the merger is adopted and shall publish an announcement in a newspaper within 30 days from the date of such resolution. A creditor has the right to require the Company to repay its debts or to provide a corresponding guarantee for such debts within 30 days from the date it receives the relevant notice or, in the case of a creditor who did not receive such notice, within 45 days from the date of the relevant announcement. Upon the merger, claims and debts of each of the merged parties shall be assumed by the company which survives the merger or the newly established company resulting from the merger. In the event of a division of the Company, its properties shall be divided up accordingly. In the event of a division, the parties to the division shall enter into a division agreement, and prepare balance sheets and asset list. The Company shall notify its creditors within 10 days from the date on which a resolution is adopted in favour of the division and shall publish an announcement in a newspaper within 30 days from the date of such resolution. Unless otherwise agreed by the Company and creditors on settling liabilities in writing prior to the split, debts ~~Debts~~ incurred by the Company before its division shall be borne by the companies after the division according to the agreement reached.

IV-B – 49

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
Article 245	Article 245	Article 213 A notice of the Company may be given in the following ways: (I) by hand; (II) by mail; (III) by fax or email; (IV) by posting on the websites designated by the Company and the Hong Kong Stock Exchange, subject to the laws, administrative regulations and listing rules of the place where the Securities of the Company are listed; (V) by announcement; (VI) by other means agreed by the Company or the recipient of the notice in advance or as accepted by the recipient of the notice upon receiving such notice; or (VII) by other means approved by the relevant regulatory authorities of the place where the Securities of the Company are listed or as specified in the Articles of Association.	Article ~~213 ~~245 A notice of the Company may be given in the following ways: (I) by hand; (II) by mail; (III) by fax or email; (IV) by posting on the websites designated by the Company and the Hong Kong Stock Exchange, subject to the laws, administrative regulations and listing rules of the place where the Securities of the Company are listed; (V) by announcement; (VI) by other means agreed by the Company or the recipient of the notice in advance or as accepted by the recipient of the notice upon receiving such notice; or (VII) by other means approved by the relevant regulatory authorities of the place where the Securities of the Company are listed or as specified in the Articles of Association.

IV-B – 50

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
		Unless the context otherwise required, the “announcement” referred to in the Articles of Association means, as to the announcements made to the holders of domestic shares or the announcements required to be made in the PRC in accordance with the relevant provisions and the Articles of Association, an announcement published on any newspaper in the PRC which shall be specified by the PRC laws and regulations, or as designated, agreed or permitted by the securities regulatory authority of the State Council; or as to the announcements made to holders of H shares of the Company or the announcements required to be made in Hong Kong in accordance with the relevant regulations and the Articles of Association, such announcement must be published in a newspaper and/or other designated media (including a website) in accordance with the requirements of the relevant listing rules. Unless otherwise provided in the Articles of Association, where a notice delivered by the Company to the holders of H shares is delivered by way of an announcement, the Company shall submit an electronic version to the Hong Kong Stock Exchange through the electronic publication system of Hong Kong Stock Exchange on the same day for publication on the website of the Hong Kong Stock Exchange in real-time in accordance with Hong Kong Listing Rules, or publish an announcement on the newspapers (including an advertisement on the newspapers) as required under the Hong Kong Listing Rules. The announcement shall be published on the Company’s website at the same time. In addition, unless otherwise provided in the Articles of Association, service must be made by hand or by prepaid mail at the address of each holder of overseas listed foreign shares registered in the register of members, so as to ensure that each shareholder is well informed and has sufficient time to exercise his/her rights or act in accordance with the terms of the notice. The holders of overseas listed foreign shares of the Company may choose in writing to receive corporate communications to be dispatched to the shareholders from the Company by electronic means or by mail, and may choose to receive only the Chinese version or English version, or both. The shareholders may also notify the Company in writing in advance within a reasonable time to change the way to receive the foresaid information and in which language on appropriate procedures. If a shareholder or director intends to prove that any notice, document, information or written statement has been served to the Company, evidences showing that such notice, document, information or written statement has been served in an ordinary manner or by prepaid mail to the correct address within the specified time shall be provided.	Notices issued by the Company by way of announcements
			shall be deemed to have been received by all relevant persons
			upon such announcements. Unless the context otherwise required, the “announcement” referred to in the Articles of Association means, as to the announcements made to the holders of domestic shares or the announcements required to be made in the PRC in accordance with the relevant provisions and the Articles of Association, an announcement published on any newspaper in the PRC or an announcement published on any website. Such newspaper
			or website

IV-B – 51

APPENDIX IV-B

PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION FOR THE A SHARE OFFERING

No.	No.		After Amendment (Revision)	After Amendment (Revision)
	No.	Before Amendment	After Amendment (Revision)
		Notwithstanding the aforesaid provision explicitly stipulating to provide and/or distribute corporate communications to shareholders in writing, in respect of the manner in which the Company provides and/or distributes corporate communications to shareholders in accordance with Hong Kong Listing Rules, if the Company obtained the prior written or implied consent of such shareholder in accordance with the relevant provisions of the relevant laws and regulations as well as the Hong Kong Listing Rules as amended from time to time, the Company may send or provide corporate communications to the shareholder by electronic means or by publication on the Company’s website. Corporate communications include but are not limited to the below: circulars, annual reports, interim reports, notices of shareholders’ general meetings and other corporate communications listed in the Hong Kong Listing Rules.	Notwithstanding the aforesaid provision explicitly stipulating to provide and/or distribute corporate communications to shareholders in writing, in respect of the manner in which the Company provides and/or distributes corporate communications to shareholders in accordance with Hong Kong Listing Rules, if the Company obtained the prior written or implied consent of such shareholder in accordance with the relevant provisions of the relevant laws and regulations as well as the Hong Kong Listing Rules as amended from time to time, the Company may send or provide corporate communications to the shareholder by electronic means or by publication on the Company’s website. Corporate communications include but are not limited to the below: circulars, annual reports, interim reports, notices of shareholders’ general meetings and other corporate communications listed in the Hong Kong Listing Rules.
	Article 246		If the notice of the Company is served by personal delivery,
			the recipient shall affix signature (or seal) to the return on
			service and the signing date shall be the date of service; if the
			notice of the Company is served by post, the second working
			day after handover to the post office shall be the date of
			service; if the notice of the Company is served by
			announcement, the date of first announcement shall be the
			date of service.
	Article 247		If the meeting notice is not sent to a person entitled to
			receive the notice due to accidental omission or such person
			does not receive the meeting notice, the meeting and the
			resolutions made at the meeting shall not be invalid.
Article 251	Article 251	Article 217 The Board of Directors of the Company shall be responsible for interpretation of the Articles of Association which become effective after being approved at the shareholders’ general meeting and on the date on which the Securities of the Company are listed and traded on the Hong Kong Stock Exchange.	Article ~~217 ~~251 The Board of Directors of the Company shall be responsible for interpretation of the Articles of Association, which become effective after being approved at the shareholders’ general meeting of the Company and on the date of listing and trading on the SSE on which the Securities of the Company’s A shares issued under initial public offering ~~are listed and traded on the Hong Kong Stock Exchange~~.

IV-B – 52

APPENDIX V

REPORT ON THE USE OF PROCEEDS FROM THE PREVIOUS OFFERING

I. BASIC INFORMATION OF PROCEEDS FROM THE PREVIOUS OFFERING

With the approval of China Securities Regulatory Commission (CSRC) License No. [2021] 2539, the Company made a public offering of H shares outside China. The shares of the Company were listed on October 19, 2021, and the over-allotment option was partially exercised on November 10, 2021. The Company issued a total of 65,742,600 overseas listed foreign shares (H shares) (including over-allotment shares) at an offering price of HK$30.50 per share. After deducting the underwriting commissions and other relevant estimated expenses, the Company received net proceeds of approximately HK$1,875.53 million (equivalent to RMB1,533.49 million) in connection with the Global Offering and the partial exercise of the over-allotment option.

As at June 30, 2022, the balance of the bank account for proceeds from H shares was RMB1,433.73 million (equivalent to HK$1,676.50 million, which is converted at an exchange rate of HK$1 to RMB0.85519.

II. ACTUAL INVESTMENT PROJECTS WITH PROCEEDS FROM THE PREVIOUS OFFERING AND CHANGES

The net proceeds from the previous offering were intended to be used as follows: (1) approximately 31% allocated to the clinical trials, registration, manufacturing and commercialization of our core product Equil; (2) 35% allocated to the clinical trials, registration, manufacturing and commercialization of our CGMS; (3) approximately 11% allocated to the preclinical studies, clinical trials, registration, manufacturing and commercialization of our secondgeneration patch insulin pump system; (4) approximately 8% allocated to the pre-clinical studies, clinical trials, registration, manufacturing and commercialization of our other products and product candidates; (5) approximately 5% used to fund the establishment of our cloud-based diabetes management platform; and (6) approximately 10% used for working capital and other general corporate purposes.

As at June 30, 2022, there was no change in the actual investment projects with the Company’s proceeds from previous offering.

III. TRANSFER OR REPLACEMENT OF THE ACTUAL INVESTMENT PROJECTS WITH PROCEEDS FROM THE PREVIOUS OFFERING

As at June 30, 2022, there was no transfer or replacement of the investment projects with the Company’s proceeds from previous offering.

V – 1

APPENDIX V

REPORT ON THE USE OF PROCEEDS FROM THE PREVIOUS OFFERING

IV. TEMPORARY USE OF IDLE PROCEEDS FOR OTHER PURPOSES

As at June 30, 2022, there was no temporary use of the Company’s proceeds from previous offering for other purposes.

V. COMPARISON OF ACTUAL USE OF PROCEEDS FROM THE PREVIOUS OFFERING WITH RELEVANT DESCRIPTIONS IN THE COMPANY’S INFORMATION DISCLOSURE DOCUMENTS

There is no discrepancy between the actual use of the Company’s proceeds from previous offering and the relevant descriptions in the Company’s periodic reports and other information disclosure documents.

The table below sets forth a detailed breakdown and description of the use of the Company’s proceeds from previous offering up to June 30, 2022.

					Actual usage	Unutilized net
		% of use of	Net proceeds	Net proceeds	up to June 30,	proceeds as of
		proceeds	from the IPO	from the IPO	2022	June 30, 2022
		(Approximately)	(HKD million)	(RMB million)	(RMB million)	(RMB million)
To	fund our Core Product	31%	581.42	475.38	7.63	467.75
	– to fund ongoing and planned clinical trials of our
	Core Product for its further development,
	including but not limited to clinical trials for
	our Core Product’s indication expansion, to
	prepare for and carry out registration of our
	Core Product in major markets worldwide	14%	262.58	214.69	2.97	211.72
	– to enhance our commercialization capabilities for
	our Core Product through expanding our global
	footprint by recruiting high-caliber sales staff
	with extensive local experience and establishing
	long-term cooperation with leading distribution
	partners, and organizing and participating in
	academic conferences and activities, among
	other efforts	11%	206.31	168.68	1.01	167.67
	– to fund the expansion of our manufacturing
	capacity of our Core Product, by upgrading our
	existing production lines, recruiting personnel
	and purchasing new machinery	6%	112.53	92.01	3.65	88.36

V – 2

APPENDIX V

REPORT ON THE USE OF PROCEEDS FROM THE PREVIOUS OFFERING

For our CGMS – to fund the pre-clinical studies, including but not limited to develop the second generation of our CGMS product, AiDEX X – to fund clinical trials of our AiDEX G7 – to fund the expansion of our manufacturing capacity of our CGMS – to enhance our commercialization capabilities for our CGMS For the pre-clinical studies, clinical trials, registration, manufacturing and commercialization of our second generation patch insulin pump system For the pre-clinical studies, clinical trials, registration, manufacturing and commercialization of our other products and product candidates To fund the establishment of our cloud-based diabetes management platform For working capital and other general corporate purposes Total	% of use of proceeds (Approximately) 35% 10% 12% 6% 7% 11% 8% 5% 10% 100%	Net proceeds from the IPO (HKD million) 656.43 187.55 225.06 112.53 131.29 206.31 150.04 93.78 187.55 1,875.53	Net proceeds from the IPO (RMB million) 536.73 153.35 184.03 92.01 107.34 168.68 122.68 76.67 153.35 1,533.49	Actual usage up to June 30, 2022 (RMB million) 9.79 2.22 1.41 5.21 0.95 5.73 1.66 5.00 69.95 99.76	Unutilized net proceeds as of June 30, 2022 (RMB million) 526.94 151.13 182.62 86.8 106.39 162.95 121.02 71.67 83.40
					1,433.73

V – 3

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

APPENDIX VI

CHAPTER 1 GENERAL PROVISIONS

• Article 1 In order to improve the corporate governance structure of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’), clarify the duties and powers of the shareholders’ meeting, ensure that shareholders’ meetings are held in a standardized manner in accordance with laws, improve the efficiency of shareholders’ meetings, and ensure that the Company’s decision-making is democratic and scientific, the Rules are formulated in accordance with the Company Law of the People’s Republic of China (the ‘‘Company Law’’), the Securities Law of the People’s Republic of China, the Rules for the Shareholders’ Meetings of Listed Companies, the Rules Governing the Listing of Stocks on the Science and Technology Innovation Board of the Shanghai Stock Exchange (the ‘‘Sci-Tech Board Listing Rules’’), the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the ‘‘Hong Kong Listing Rules’’), the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Articles of Association’’) and other relevant provisions.

• Article 2 The Company shall convene shareholders’ meetings in strict accordance with the relevant provisions of laws, administrative regulations, the Sci-Tech Board Listing Rules, the Hong Kong Listing Rules and the Articles of Association, to ensure that shareholders can exercise their rights in accordance with laws.

• The Board shall earnestly perform its duties and organize shareholders’ meetings conscientiously and punctually. All Directors of the Company shall be diligent and responsible to ensure the normal convening of shareholders’ meetings and the exercise of authority in accordance with laws.

• Article 3 The shareholders’ meeting shall exercise its authority within the scope stipulated in the Company Law and the Articles of Association.

• Article 4 A shareholders’ meeting shall either be an annual general meeting or an extraordinary general meeting. Annual general meetings are held once per annum within six months after the end of the previous accounting year. Extraordinary general meetings are held irregularly. Where there are circumstances under which an extraordinary general meeting shall be held as stipulated in Article 100 of the Company Law, the extraordinary general meeting shall be convened within two months.

VI – 1

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

If the Company is unable to convene a shareholders’ meeting within the above-mentioned time limit, it shall report to the office of the China Securities Regulatory Commission (the ‘‘CSRC’’) in the place where the Company is located and the Shanghai Stock Exchange, explain the reasons and make an announcement.

Article 5 When the Company convenes a shareholders’ meeting, it shall engage lawyers to issue legal opinions and make an announcement on the following issues:

• (1) whether the convening and the convening procedures of the meeting comply with the relevant laws, administrative regulations, the Rules and the Articles of Association;

• (2) whether the qualifications of the persons attending the meeting and the convener are legal and valid;

• (3) whether the voting procedures and the voting results of the meeting are legal and valid;

• (4) legal opinions issued on other relevant issues at the request of the Company.

CHAPTER 2 CONVENING OF SHAREHOLDERS’ MEETINGS

Article 6 The Board shall convene the shareholders’ meeting within the period specified in Article 4 of the Rules.

Article 7 Independent non-executive Directors are entitled to propose to the Board to convene an extraordinary general meeting. Regarding the proposal of independent non-executive Directors to convene an extraordinary general meeting, the Board shall, in accordance with laws, administrative regulations and the Articles of Association, provide written feedback on whether to agree or disagree with the convening of the extraordinary general meeting within ten days after receiving the proposal. If the Board agrees to convene the extraordinary general meeting, it will issue a notice on convening the meeting within five days after the resolution of the Board is made; if the Board does not agree to convene the extraordinary general meeting, it will explain the reasons and make an announcement.

Article 8 Shareholders requesting the convening of extraordinary general meetings or class meetings shall follow the procedures below:

VI – 2

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

• (1) Shareholders who collectively hold more than 10% (inclusive) of the shares with voting rights at the proposed meeting may sign one or several written requests of identical form and content, requesting the Board to convene an extraordinary general meeting or a class meeting and stating the subjects of the meeting. The Board will provide feedback on whether it agrees or disagrees with the convening of the extraordinary general meeting or the class meeting within ten days after receiving the aforesaid written request(s). The aforesaid number of shares held shall be calculated on the date when the shareholders submit the written request(s).

• (2) If the Board agrees to convene the extraordinary general meeting or the class meeting, it shall issue a notice on convening the meeting within five days after the resolution of the Board is made. Changes to the original request in the notice shall be subject to the consent of relevant shareholders. If the Board does not agree to convene the extraordinary general meeting or the class meeting or fails to provide feedback within ten days after receiving the written request(s), the shareholders who have made the request may propose to the Supervisory Committee to convene the extraordinary general meeting or the class meeting and shall submit a request in writing to the Supervisory Committee.

• (3) If the Supervisory Committee agrees to convene the extraordinary general meeting or the class meeting, it shall issue a notice on convening the meeting within five days after receiving the request. Changes to the original request in the notice shall be subject to the consent of relevant shareholders. If the Supervisory Committee fails to issue the notice on convening the meeting within the prescribed time limit, it shall be deemed that the Supervisory Committee has failed to convene and preside over the meeting, and shareholders who individually or collectively hold more than 10% of the shares with voting rights at the proposed meeting for more than ninety consecutive days may convene and preside over such meeting on their own.

If shareholders convene and hold the meeting on their own due to the Board’s failure of holding the meeting in response to the aforesaid request, all reasonable expenses incurred therefor shall be borne by the Company and shall be funded by the amounts the Company is going to pay to the Directors who fails to perform their duties in this regard.

VI – 3

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

Article 9 The Supervisory Committee has the right to propose to the Board to convene an extraordinary general meeting, which shall be made in writing. The Board shall, in accordance with laws, administrative regulations and the Articles of Association, provide written feedback on whether it agrees or disagrees to convene the extraordinary general meeting within ten days after receiving the proposal.

If the Board agrees to convene the extraordinary general meeting, it shall issue a notice on convening the meeting within five days after the resolution of the Board is made. Changes to the original request in the notice shall be subject to the consent of the Supervisory Committee.

If the Board disagrees to convene the extraordinary general meeting or fails to issue the notice on convening the meeting within ten days after receiving the proposal, it shall be deemed that the Board is unable or unwilling to perform the duties of convening shareholders’ meetings, and the Supervisory Committee may convene and preside over such meeting on its own.

• Article 10 If the Supervisory Committee or shareholders decide to convene a shareholders’ meeting on their own, they must notify the Board in writing and file with the Shanghai Stock Exchange at the same time.

• Before the resolution of the shareholders’ meeting is announced, the shareholding ratio of the convening shareholders shall not be less than 10%.

• The Supervisory Committee or the convening shareholders shall submit relevant evidentiary materials to the Shanghai Stock Exchange when issuing the shareholders’ meeting notice and the announcement of such meeting’s resolutions.

• Article 11 For the shareholders’ meeting convened by the Supervisory Committee or shareholders on their own, the Board shall cooperate. The Board shall provide the register of members as at the equity record date. If the Board does not provide the register of members, the convener may apply to the securities depository and clearing institution to obtain the register of members with the relevant announcement on the notice of convening the shareholders’ meeting. The register of members obtained by the convener shall not be used for any purpose other than convening the shareholders’ meeting.

• Article 12 For the shareholders’ meeting convened by the Supervisory Committee or the shareholders on their own, the expenses incurred therefor shall be borne by the Company.

VI – 4

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

CHAPTER 3 PROPOSALS AND NOTICES OF SHAREHOLDERS’ MEETINGS

• Article 13 The content of the proposal shall fall within the scope of authorities of the shareholders’ meeting, include clear subjects and specific resolution matters, and comply with the relevant provisions of laws, administrative regulations and the Articles of Association.

• Article 14 When the Company convenes a shareholders’ meeting, the Board, the Supervisory Committee and shareholders who individually or collectively hold more than 3% of the Company’s shares have the right to present proposals to the Company.

Shareholders who individually or collectively hold more than 3% of the Company’s shares may put forward interim proposals and submit the proposals in writing to the convener. The convener shall issue a supplementary shareholders’ meeting notice within two days after receiving the proposals and release an announcement on the interim proposals.

Except for the circumstances specified in the preceding paragraph, the convener shall not modify the proposals stated in the shareholders’ meeting notice or add new proposals after the notice is issued.

The shareholders’ meeting shall not vote and resolve on the proposals that are not stated in the meeting notice or do not conform to the provisions stated herein.

• Article 15 The convener shall notify the shareholders twenty-one days before the holding of annual general meeting and fifteen days before the holding of extraordinary general meeting. In determining the starting and ending dates for the notification period, the Company shall not include the date on which the meeting is held.

Article 16 The notice of a shareholders’ meeting shall comply with the following requirements:

• (1) The notice shall be given in writing;

• (2) The notice shall specify the venue, date, time and duration of the meeting;

• (3) The notice shall provide the matters and proposals to be discussed at the meeting;

VI – 5

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

• (4) The notice shall provide shareholders with information and explanations that are necessary for shareholders to make informed decisions on the matters to be discussed. This principle covers, without limitation, provision of the specific terms and contracts (if any) of the transactions to be discussed and the detailed explanation of the reasons and consequences of such transactions when the Company proposes merger, share repurchase, capital reorganization or other forms of restructuring;

• (5) If any Directors, Supervisors, the general manager and other members of the senior management have material interests in the matters to be discussed, the notice shall disclose the nature and extent of these material interests. If the impact of the matters to be discussed on such Directors, Supervisors, general manager and other members of the senior management in the capacity of shareholders is different from the impact on other shareholders of the same class, the notice shall provide a description of such difference;

• (6) The notice shall contain the full text of any special resolution to be considered and approved at the meeting;

• (7) The notice shall clearly state that all shareholders who are entitled to attend and vote at the shareholders’ meeting have the right to appoint one or more proxies to attend and vote on their behalf, and such proxies do not have to be shareholders of the Company;

• (8) The notice shall specify the equity record date for shareholders who are entitled to attend the shareholders’ meeting;

• (9) The notice shall specify the time and place for the delivery of the power of attorney authorizing proxies to vote;

• (10) The notice shall provide the names and telephone numbers of permanent contact persons for conference affairs;

• (11) The notice shall specify the time and procedures for voting through the Internet and by other means.

VI – 6

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

The shareholders’ meeting notice and the supplementary notice shall fully and completely disclose all the specific contents of all proposals. Where the opinions of independent non-executive Directors are required on the matters to be discussed, the opinions and reasons of the independent non-executive Directors shall be disclosed at the same time when the notice of the meeting or the supplementary notice is published.

The interval between the equity record date and the date of meeting shall comply with the requirements of relevant regulatory authorities in the place where the Company’s shares are listed. Once the equity record date is determined, it shall not be changed.

• Article 17 The notice of a shareholders’ meeting shall be delivered by hand or prepaid mail to shareholders (whether or not such shareholders have voting rights at the meeting). The address of the recipient shall be the address recorded in the register of members; or shall be published on the website of the Company and/ or the designated website of the stock exchange where the Company’s shares are listed on the conditions of complying with applicable laws, regulations and the listing rules of the place where the Company’s shares are listed. If it is necessary to deliver an announcement to the holders of overseas-listed foreign shares under the Rules, the announcement shall be published in the way stipulated by the Hong Kong Listing Rules at the same time. For the holders of domestic shares, the notice of a shareholders’ meeting may be released by way of announcement.

The announcement stated in the preceding paragraph shall be published on one or more newspapers designated by the securities regulatory authorities under the State Council. Upon such announcement, all holders of domestic shares are deemed to receive the notice of shareholders’ meeting.

• Article 18 If the meeting notice is not sent to persons who are entitled to receive the notice due to accidental omission or such persons do not receive the meeting notice, the meeting and the resolutions made at the meeting shall not be invalid.

• Article 19 If the election of Directors or Supervisors is proposed to the shareholders’ meeting for discussion, the notice of the meeting shall fully disclose the detailed information of the candidates for Directors or Supervisors, which include at least the following aspects:

• (1) personal particulars such as educational background, work experience and concurrent positions;

VI – 7

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

• (2) whether there is a connected relationship with the Company or the Company’s controlling shareholder and de-facto controller;

• (3) disclosure of the number of the Company’s shares held;

• (4) whether they have been punished by the CSRC and other relevant departments or disciplined by the stock exchange.

Except for the election of Directors and Supervisors by adopting the cumulative voting system, each candidate for Directors and Supervisors shall be proposed in a separate proposal.

• Article 20 After the notice is issued, the shareholders’ meeting shall not be postponed or cancelled without justifiable reasons, and the proposals stated in the notice shall not be withdrawn. In the event of postponement or cancellation, the convener shall provide the announcement and the reasons at least two working days before the original date of convening the meeting.

CHAPTER 4 HOLDING OF SHAREHOLDERS’ MEETINGS

• Article 21 The Board and other conveners will take necessary measures to ensure the normal order of the shareholders’ meeting. Measures will be taken to stop the acts of interfering with the shareholders’ meeting, picking quarrels and provoking troubles and infringing on the legitimate rights and interests of shareholders, and the relevant departments will be reported to investigate and deal with them in a timely manner.

• Article 22 The venue where the Company holds the shareholders’ meeting shall be the Company’s domicile or the place specified in the notice of the meeting.

The shareholders’ meeting shall set up the venue and be held in the form of on-site meeting. The Company may adopt other ways recognized by the rules of the place where its shares are listed to facilitate the shareholders’ participation in the meeting. Shareholders who attend the meeting through the above ways shall be deemed to be present.

Shareholders may attend the shareholders’ meeting and exercise their voting rights in person, or entrust others to attend and exercise their voting rights on their behalf within the scope of authorization.

• Article 23 All shareholders registered on the equity record date or their proxies have the right to attend the shareholders’ meeting and exercise voting rights in accordance with relevant laws, regulations and the Rules.

VI – 8

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

Any shareholder who has the right to attend and vote at a shareholders’ meeting shall have the right to appoint one or more persons (who may not be a shareholder) as a proxy or proxies to attend and vote on his/her behalf. According to the entrustment of the shareholder, such proxy may exercise the following rights:

• (1) The shareholder’s right to speak at the shareholders’ meeting;

• (2) Request to vote by ballot alone or jointly with others; and

• (3) Unless otherwise required by applicable securities listing rules or other securities laws and regulations, the exercise of voting rights by a show of hands or by ballot, but when more than one proxies are appointed, such proxies can only exercise the voting right through voting by ballot.

If the shareholder is a recognized clearing house (or its nominee), the shareholder may authorize one or more persons it thinks fit to act as its representative at any shareholders’ meeting or any class meeting. However, if several persons are authorized, the power of attorney shall specify the number and class of shares involved in each such person’s authorization, and the power of attorney shall be signed by the authorized person of the recognized clearing house. The persons thus authorized can attend the meeting on behalf of the recognized clearing house (or its nominee) (without presentation of the shareholding certificate, and proving the formal authorization with the notarized authorization and/or further evidence) and exercise rights, as if the said persons were individual shareholders of the Company.

Article 24 Individual shareholders who attend the meeting in person shall present the identification card, or other valid documents or certificates or the stock account card to show their identity. The proxy entrusted by shareholders to attend the meeting shall provide his/her identification card and the power of attorney of the shareholders.

A corporate shareholder shall entrust its legal representative or proxy entrusted by such legal representative to attend the meeting. When the legal representative attends the meeting, he/she shall present his/her identification card and effective evidence of his/her qualification as legal representative; when an entrusted proxy attends the meeting, he/she shall present his/her identification card and the power of attorney in writing issued to him/her by the legal representative of the corporate shareholder.

VI – 9

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

Article 25 A shareholder shall entrust a proxy in writing, which shall be signed by the appointer or the proxy commissioned by him/her in writing; If the appointer is a legal person, it shall be affixed with the seal of the legal person or signed by its director or duly appointed proxy.

Article 26 The instrument appointing a proxy shall be deposited at the domicile of the Company or at such other place as specified in the notice of the meeting at least twenty-four hours prior to the meeting at which the proxy is authorized to vote or at least twenty-four hours prior to the specified time of the voting. Where the instrument is signed by another person authorized by the appointer, the authorization letter or other documents authorizing the signatory shall be notarized. The notarized authorization letter or other authorizing documents shall be deposited together with the instrument appointing the voting proxy at the domicile of the Company or at such other place as specified in the notice of the meeting.

Where the appointer is a legal person, its legal representative or the person authorized by resolution of its board of directors or other decision-making bodies shall be entitled to attend the shareholders’ meeting of the Company as the representative of such legal person.

If the shareholder is a recognized clearing house (or its nominee) as defined in the relevant ordinance of Hong Kong as enacted from time to time, the said shareholder may authorize one or more persons it thinks fit to act as its proxy or representative at any shareholders’ meeting or any class meeting. However, where several persons are thus authorized, the power of attorney or the authorization document shall specify the number and class of shares involved in each such person’s authorization. The persons thus authorized may exercise rights on behalf of the recognized clearing house (or its nominee) (without presentation of the shareholding certificate, and proving the formal authorization with the notarized authorization and/or further evidence), as if the said persons were individual shareholders of the Company.

Article 27 Any instrument of proxy sent to a shareholder by the Board for use by him/her for appointing a proxy shall be in such form to enable the shareholder to freely instruct the proxy to vote in favor or against the related resolution(s), and to instruct separately in respect of each resolution dealing with business to be voted on at the meeting. The instrument shall contain a statement on whether the shareholder’s proxy may vote at his/her discretion in default of specific instructions from the shareholder.

VI – 10

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

The instrument issued by the shareholder authorizing his/her proxy to attend the shareholders’ meeting should contain the following aspects:

• (1) the name of the proxy;

• (2) whether he/she has the voting right;

• (3) instruction to vote for or against or abstain from voting on each issue included in the agenda of the shareholders’ meeting;

• (4) the date of issue and validity period of the instrument;

• (5) the signature (or seal) of the appointer. If the appointer is a corporate shareholder, the corporate seal shall be affixed.

• Article 28 If, before voting, the appointer passed away, lost his/her ability to act, withdrew the entrustment, withdrew the authorization to the signatory or transferred all his/her shares, the vote cast by the proxy in accordance with the instrument of proxy shall remain valid so long as the Company has not received any written notice regarding such matters before the commencement of the relevant meeting.

• Article 29 The convener and the lawyer shall verify the qualification of shareholders with the register of members provided by the securities depository and clearing institution, and shall record the names of shareholders and the number of their voting shares. The registration process shall end before the presider of the meeting announces on site the number of shareholders and proxies that attend the meeting, and the number of their voting shares.

• Article 30 A shareholders’ meeting shall be convened by the Board and presided over by the chairman of the Board. Where the chairman of the Board is unable or fails to perform his/her duties, a Director shall be jointly elected by more than half of the Directors to preside over the meeting. If no such election is made, a shareholder as elected from the attending shareholders may preside over the meeting. If, for any reason, shareholders fail to elect the presider of the meeting, the shareholder (including proxy appointed thereof) holding the most voting shares thereat shall act as the presider of the meeting.

VI – 11

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

A shareholders’ meeting convened by the Supervisory Committee on its own shall be presided over by the chairman of the Supervisory Committee. Where the chairman of the Supervisory Committee is unable or fails to perform his/ her duties, a Supervisor shall be jointly elected by more than half of the Supervisors to preside over the meeting.

A shareholders’ meeting convened by the shareholders on their own shall be presided over by a representative elected by the convener.

When a shareholders’ meeting is held and the presider violates the Rules which makes it difficult for the meeting to continue, a person may be elected at the meeting to act as the presider so that the meeting can continue, which is subject to the approval of more than half of the attending shareholders with voting rights.

• Article 31 When a shareholders’ meeting is held, all Directors, Supervisors and the secretary of the Board shall attend the meeting, and the general manager and other members of the senior management shall be present at the meeting, except those who have justifiable reasons and have submitted the written application for leave to the convener of the meeting in advance. However, Directors, Supervisors, the secretary of the Board, the general manager and other members of the senior management who are required to answer shareholders’ questions at the meeting shall not be absent by the application for leave.

• Article 32 At the annual general meeting, the Board and the Supervisory Committee shall submit their work reports for the previous year to the meeting. Each independent non-executive Director shall also submit his/her work report.

• Article 33 Directors, Supervisors and members of the senior management shall provide explanation and clarification to the inquiries or suggestions raised by shareholders at the meeting.

• Article 34 Before voting, the presider of the meeting shall announce the number of attending shareholders and proxies and the total number of their voting shares, which are subject to the record made in the registration process of the meeting.

• Article 35 The shareholders’ meeting shall maintain the minutes, which the secretary of the Board is responsible for and contains the following aspects:

• (1) the time, venue and agenda of the meeting and the name of the convener;

VI – 12

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

• (2) the names of the presider of the meeting and the Directors, Supervisors, the general manager and other members of the senior management who attend the meeting or are present at the meeting;

• (3) the number of shareholders and proxies attending the meeting, the total number of voting rights held and the proportion of such shares in the total number of shares of the Company;

• (4) the process of considering each proposal, the key points of speeches and the voting results;

• (5) inquiries or suggestions of shareholders and the corresponding replies and explanations;

• (6) the names of the lawyers, the vote-counters and the scrutineers;

• (7) other contents which shall be included in the minutes under the requirements of the Articles of Association.

• Article 36 The convener shall ensure that the contents of the minutes are true, accurate and complete. The Directors, Supervisors, the secretary of the Board, the convener or his/her representative and the presider of the meeting shall sign on the minutes. The minutes shall be kept together with the signed attendance record of shareholders attending the meeting in person, the instruments of authorization to proxies attending the meeting on behalf of shareholders and valid materials relating to the voting by other means, for a period of not less than ten years.

• Article 37 The convener shall ensure that the shareholders’ meeting will proceed continuously until the conclusion of the final resolution. If a shareholders’ meeting is suspended or no resolution is made due to special reasons including force majeure, necessary measures shall be adopted to resume the shareholders’ meeting as soon as practicable or directly adjourn the meeting and make an announcement in a timely manner. At the same time, the convener shall submit a report to the office of the CSRC in the place where the Company is located and the Shanghai Stock Exchange.

• Article 38 Where a proposal on election of Directors or Supervisors is passed at the shareholders’ meeting, the new Directors and Supervisors shall take office in accordance with the Articles of Association.

VI – 13

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

Article 39

• If the proposal on cash dividend distribution, bonus issue or conversion of capital reserve into share capital is passed at the shareholders’ meeting, the Company shall implement the specific plan within two months after the conclusion of the meeting.

CHAPTER 5 VOTING PROCEDURES AND RESOLUTIONS OF SHAREHOLDERS’ MEETING

Article 40 Resolutions of the shareholders’ meeting shall be divided into ordinary resolutions and special resolutions.

An ordinary resolution of a shareholders’ meeting shall be passed by more than one half of the voting rights held by the shareholders (including proxies) attending the meeting.

A special resolution of a shareholders’ meeting shall be passed by more than two thirds of the voting rights held by the shareholders (including proxies) attending the meeting.

Article 41 The following matters shall be approved by ordinary resolution at a shareholders’ meeting:

• (1) work reports of the Board and the Supervisory Committee;

• (2) profit distribution plan and loss recovery plan formulated by the Board;

• (3) election or removal of members of the Board and the non-staff representative Supervisors, their remunerations and the payment methods;

• (4) annual financial budgets and statements of final accounts, the balance sheet, the income statement and other financial statements of the Company; and

• (5) the annual report of the Company;

• (6) any matters other than those to be passed by special resolution according to relevant laws, administrative regulations, the listing rules of the place where the Company’s shares are listed or the Articles of Association.

VI – 14

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

Article 42 The following matters shall be approved by special resolution at a shareholders’ meeting:

• (1) the increase or decrease of registered capital and the issuance of shares of any class, warrants for share subscription and other similar securities;

• (2) the issuance of debentures of the Company;

• (3) the division, spin-off, merger, dissolution, liquidation or change of the corporation form of the Company;

• (4) amendments to the Articles of Association;

• (5) purchase or sale of material assets within one year or guarantee amount exceeding 30% of the audited total assets of the Company for the latest accounting period;

• (6) equity incentive plans;

• (7) other matters the shareholders’ meeting has approved as ordinary resolutions and considers as material to the Company and necessary to be approved by special resolution;

• (8) other matters to be approved by special resolution according to relevant laws, administrative regulations, the Articles of Association and the listing rules of the place where the Company’s shares are listed.

• Article 43 In the consideration of matters and resolutions proposed at the shareholders’ meeting, attending shareholders or proxies can express opinions on such matters and resolutions.

Shareholders can express the opinions in either oral or written form.

Article 44 When voting at the meeting, a shareholder (including his/her proxy) shall exercise his/her voting rights based on the number of voting shares held. Each share shall have one vote.

Pursuant to the applicable laws and regulations and the listing rules of the place where the Company’s shares are listed, where any shareholder is required to abstain from voting on any particular resolution or restricted to voting only for or against any particular resolution, any vote cast by or on behalf of such shareholder in contravention of such requirement or restriction shall not be tallied.

VI – 15

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

APPENDIX VI

Where material issues affecting the interests of minority shareholders are considered at the shareholders’ meeting, the votes of minority shareholders shall be counted separately. The separate votes counting results shall be disclosed publicly in a timely manner.

The shares held by the Company shall have no voting right, and shall not be included in the total number of voting shares of shareholders attending the shareholders’ meeting.

Where a shareholder’s purchase of voting shares of the company violates the provisions of paragraphs 1 and 2 of Article 63 of the Securities Law, such shareholder shall not exercise the voting rights of the portion of shares exceeding the specified proportion within thirty-six months after the purchase, and such shares shall not be counted in the total number of voting shares held by shareholders attending the shareholders’ meeting.

The Board, independent non-executive Directors, shareholders holding more than 1% of voting shares, or investor protection institutions established in accordance with laws, administrative regulations or the provisions of the CSRC may publicly collect the voting rights of shareholders. At the time of collecting the voting rights of shareholders, it is necessary to fully disclose the specific voting intention and other information to the persons from whom voting rights are collected. It is forbidden to collect shareholders’ voting rights with compensation or in the disguised form of compensation. Except for statutory conditions, the Company shall not impose a minimum shareholding ratio limit on collecting voting rights.

Article 45 Before voting, the presider of the shareholders’ meeting shall announce the number of attending shareholders and proxies and the total number of their voting shares, which are subject to the record made in the registration process of the meeting.

Article 46 When the shareholders’ meeting considers matters pertaining to connected transactions, the connected shareholders and their close associates shall not participate in voting, and the number of voting shares represented by them shall not be counted in the total number of valid votes; the announcement on resolutions of the meeting shall fully disclose the voting by non-connected shareholders.

VI – 16

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

APPENDIX VI

Before the shareholders’ meeting considers matters relating to connected transactions, the Company shall determine the scope of connected shareholders in accordance with relevant laws, regulations and regulatory documents. Connected persons or their authorized representatives may attend the shareholders’ meeting, and may state their views to the attending shareholders in accordance with the procedures of the meeting, but they shall abstain from voting in a poll.

When the shareholders’ meeting considers matters relating to connected transactions, connected shareholders shall abstain from voting. If connected shareholders fail to abstain from voting, other shareholders attending the meeting shall have the right to request them to abstain from voting. After connected persons have abstained from voting, other shareholders shall vote according to their voting rights and pass the corresponding resolutions in accordance with the rules provided herein. The presider of the meeting shall announce the number of shareholders and proxies (excluding connected persons who attend the meeting) and the total number of their voting shares.

In order to be valid, the resolutions made at the shareholders’ meeting on matters relating to connected transactions shall be passed by more than half of the votes cast by the non-connected shareholders attending the meeting. However, when the connected transaction involves matters that need to be passed by special resolution in accordance with the rules provided herein, the resolutions of the shareholders’ meeting, in order to become valid, must be passed by more than two thirds of the voting rights held by the non-connected persons attending the meeting.

If a connected person or its close associates violate the provisions of this article and participate in voting, the voting on the relevant connected transaction shall be invalid.

Article 47 The list of candidates for Directors and Supervisors shall be submitted to the shareholders’ meeting for voting in the form of proposal.

The Board shall disclose the biographical details and basic information of the candidates for directors and supervisors to the shareholders.

The candidates for Directors and non-employee representative Supervisors shall be nominated by the Board and the Supervisory Committee or nominated by shareholders who individually or collectively hold more than 3% of the Company’s shares, which shall be proposed to the shareholders’ meeting for election.

VI – 17

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

The candidate for the employee representative Supervisor shall be nominated by the labor union of the Company and shall be proposed to the employee representative conference of the Company for election.

Article 48

When voting on the election of Directors and Supervisors, the shareholders’ meeting may adopt the cumulative voting system in accordance with the provisions of the Articles of Association or the resolutions of the meeting.

The cumulative voting system referred to in the preceding paragraph means that at the shareholders’ meeting where Directors or Supervisors are elected, each share shall have the same number of voting rights as the number of directors or supervisors to be elected, and shareholders’ voting rights may be used collectively.

The implementation rules of the cumulative voting system are as follows:

• (i) The election of executive Directors, non-executive Directors, independent non-executive Directors and Supervisors shall be voted on separately.

• In the election of executive Directors, the number of votes which each attending shareholder is entitled to cast is equal to the number of shares held by them, multiplied by the number of executive Directors to be elected in that shareholders’ meeting. That portion of voting rights shall only be cast on candidates for executive Directors of the Company.

• In the election of non-executive Directors, the number of votes which each attending shareholder is entitled to cast is equal to the number of shares held by them, multiplied by the number of nonexecutive Directors to be elected in that shareholders’ meeting. That portion of voting rights shall only be cast on candidates for non-executive Directors of the Company.

• In the election of independent non-executive Directors, the number of votes which each attending shareholder is entitled to cast is equal to the number of shares held by them, multiplied by the number of independent non-executive Directors to be elected in that shareholders’ meeting. That portion of voting rights shall only be cast on candidates for independent non-executive Directors of the Company.

VI – 18

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

  4. In the election of Supervisors, the number of votes which each attending shareholder is entitled to cast is equal to the number of shares held by them, multiplied by the number of Supervisors to be elected in that shareholders’ meeting. That portion of voting rights may only be cast on candidates for Supervisors of the Company.

• (ii) The number of votes held by each share is equal to the number of Directors or Supervisors the shareholder is entitled to elect, and the shareholders may divide their votes equally among each candidate for Directors or Supervisors, or may concentrate their votes on one or some of the candidate(s), provided that the total number of votes exercised by a shareholder shall not exceed the total number of votes he/she is entitled to for such category of candidates.

• (iii) The candidates for Directors and Supervisors shall be ultimately elected according to the number of votes and the requirements for directors and supervisors provided in the Articles of Association.

• Article 49 Except for the cumulative voting system, all proposals shall be voted on one by one at the shareholders’ meeting. If several proposals are related to the same matter, votes shall be cast in the chronological order of submitting the proposals. Unless a shareholders’ meeting is suspended or no resolution can be made due to force majeure or other special reasons, voting of such proposals shall neither be shelved nor refused at the meeting.

• Article 50 The Company may offer multiple ways and channels to facilitate shareholders’ participation in the shareholders’ meeting on the condition of ensuring that the meeting is legal and valid.

• Article 51 When considering a proposal, the shareholder’s meeting shall not modify the proposal; otherwise, the relevant change shall be deemed as a new proposal on which may not be voted at the meeting.

• Article 52 The same voting right shall only be exercised by attending the meeting in person, through the Internet or any one of the other voting methods. The vote cast first shall prevail if repeated voting occurs in relation to the same voting right.

• Article 53 Except for the resolutions on the procedures or administrative matters of the shareholders’ meeting, which may be decided by the presider of the meeting in good faith and voted on by a show of hands, voting at a shareholders’ meeting shall be conducted by way of open ballot.

VI – 19

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

• Article 54 While voting by ballot, shareholders (including their proxies) with two or more voting rights do not necessarily use all their voting rights to vote for or against a proposal.

• In the voting, the shareholders’ meeting shall vote on all proposals one by one.

• Article 55 When the dissenting votes and the affirmative votes are equal, whether by a show of hands or by ballot, the presider of the meeting has the right to cast one more vote.

• Article 56 Shareholders attending the shareholders’ meeting shall provide one of the following voting intentions in respect of the proposals presented for voting: affirmative, negative or abstention, except that the securities depository and clearing institution, as the nominal holders of shares under the Mainland-Hong Kong Stock Connect, makes a declaration according to the intentions of actual holders.

• If the voting slip has not been completed or has been completed incorrectly or the writing is illegible or that the voting slip has not been cast, it shall be treated that the voter has waived his/her voting rights, and the voting results of the relevant number of shares held by him/her shall be counted as ‘‘abstention’’.

• Article 57 Before the proposals are being voted on at the shareholders’ meeting, two shareholder representatives shall be elected to participate in vote counting and scrutinizing. If there is a connected relationship between the matters to be considered and the relevant shareholders and their proxies shall not participate in the vote counting or scrutinizing.

When the proposals are being voted on at the shareholders’ meeting, lawyers, shareholder representatives and supervisor representatives shall be jointly responsible for vote counting and scrutinizing.

• Shareholders or their proxies voting through the Internet or otherwise shall have the right to check their own votes cast through the relevant voting system.

• Article 58 The on-site shareholders’ meeting shall not end earlier than the one held through the Internet or by other ways. The presider of the meeting shall announce the details and results of the voting on each proposal at the meeting, and state whether a proposal is passed according to the voting results.

VI – 20

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

Before announcing the voting results officially, related parties involved in the voting at the on-site meeting, through the Internet or by other ways, including the Company, the vote counter, the vote-counting scrutineer, substantial shareholders and the Internet service providers, shall assume confidentiality obligations for the voting details.

• Article 59 If the presider of the meeting has any doubt on the voting results, he/she may arrange for vote counting. If the presider does not arrange for vote counting and the shareholders or their proxies attending the meeting object to the results announced by the presider, they shall have the right to demand vote counting immediately after the announcement of the voting results, and the presider shall arrange for vote counting immediately.

• Article 60 If the vote counting is performed at a shareholders’ meeting, the result of the vote counting shall be recorded in the minutes of the meeting.

• The minutes, together with the signed attendance record of shareholders attending the meeting in person and the instruments of authorization to proxies attending the meeting on behalf of shareholders, shall be kept at the domicile of the Company.

• Article 61 The announcement on resolutions of a shareholders’ meeting shall be published in a timely manner. Such announcement shall contain the number of shareholders and proxies attending the meeting, the total number of voting shares held by them and the proportion in the total number of voting shares of the Company, the form of voting, the voting result of each resolution and the detailed content of each resolution.

• Article 62 If a proposal is not passed or a resolution passed at the previous meeting is amended at the current meeting, the announcement on resolutions of the shareholders’ meeting shall provide a special note in this regard.

• Article 63 If the proposal on cash dividend distribution, bonus issue or conversion of capital reserve into share capital is passed at the shareholders’ meeting, the Company shall implement the specific plan within two months after the conclusion of the meeting.

• Article 64 The resolution of the shareholders’ meeting shall be null and void if it contains content that violates laws and administrative regulations,

VI – 21

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

Controlling shareholders and de facto controllers of the Company shall neither restrict nor impede minority shareholders from exercising their voting rights in accordance with laws, nor harm the legitimate interests of the Company and its minority shareholders.

If the convening procedures and voting methods of a shareholders’ meeting violate laws, administrative regulations or the Articles of Association, or the content of the resolution violates the Articles of Association, shareholders may apply to the people’s court to cancel the resolution within sixty days from the date of making the resolution.

• Article 65 Copies of the minutes are available free of charge for inspection during office hours of the Company. If any shareholder requests for copies of relevant meeting minutes, the Company shall distribute the copies within seven days after receiving a reasonable fee.

CHAPTER 6 SPECIAL PROCEDURES FOR VOTING OF CLASS SHAREHOLDERS

Article 66 Holders of different classes of shares are class shareholders.

Class shareholders shall enjoy the rights and assume the obligations in accordance with laws, administrative regulations and the Articles of Association.

If the share capital of the Company includes non-voting shares, the name of such shares must be denoted by the wordings of ‘‘non-voting’’. Where the share capital includes shares with different voting rights, the designation of each class of shares, other than those with the most favorable voting rights, must include the words ‘‘restricted voting’’ or ‘‘limited voting’’.

• Article 67 Rights conferred on any class of shareholders may not be varied or abrogated unless approved by a special resolution of shareholders at a shareholders’ meeting and by the class shareholders so affected at a separate meeting convened in accordance with Articles 69 to 73 provided herein.

Article 68 Under the following circumstances, rights of shareholders of a certain class shall be deemed to have been changed or abrogated:

• (1) to increase or decrease the number of shares of such class, or increase or decrease the number of shares of class having voting or equity rights or other privileges equal or superior to those of the shares of such class;

VI – 22

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

• (2) to convert all or part of the shares of such class into shares of another class or to convert all or part of the shares of another class into the shares of such class or grant such conversion right;

• (3) to remove or reduce rights to accrued dividends or rights to cumulative dividends attached to shares of such class;

• (4) to reduce or remove a dividend preference or a liquidation preference attached to shares of such class;

• (5) to add, remove or reduce conversion privileges, options, voting rights, transfer rights, pre-emptive rights, or rights to acquire securities of the Company attached to shares of such class;

• (6) to remove or reduce rights to receive payment payable by the Company in particular currencies attached to shares of such class;

• (7) to create a new class having voting or equity right or other privileges equal or superior to those of the shares of such class;

• (8) to restrict the transfer or ownership of the shares of such class or impose additional restrictions on such rights;

• (9) to issue rights to subscribe for, or convert into, shares of such class or another class;

• (10) to increase the rights or privileges of shares of another class;

• (11) to restructure the Company where the proposed restructuring will result in different classes of shareholders bearing a disproportionate degree of liability in such proposed restructuring; and

• (12) to amend or abolish the terms stipulated in this Chapter.

Article 69

The affected class shareholders, whether or not they originally have voting rights at shareholders’ meetings, shall nevertheless have the right to vote at class meetings in respect of matters concerning paragraphs (2) to (8), (11) to (12) of Article 68, but interested shareholders shall not be entitled to vote at class meetings.

VI – 23

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

The ‘‘interested shareholder’’ in the preceding paragraph shall have the following meanings:

• (1) If the Company has made a repurchase offer to all shareholders in the same proportion or has repurchased its own shares by public trading on a stock exchange in accordance with Article 27 of the Articles of Association, the ‘‘interested shareholder’’ refers to the controlling shareholder as defined in Article 61 of the Articles of Association;

• (2) In the case of repurchase of shares by an off-market contract according to Article 27 of the Articles of Association, the ‘‘interested shareholder’’ refers to a shareholder who is connected with the contract; or

• (3) In the case of restructuring of the Company, the ‘‘interested shareholder’’ refers to a shareholder within a class who assumes responsibilities by a proportion that is less than those of other shareholders of the same class or who has an interest that is different from those of other shareholders of the same class.

• Article 70 Resolutions of a class meeting shall be approved by more than two thirds of the voting shares represented by shareholders of that class attending the meeting in accordance with Article 69.

• Article 71 A written notice convening a class meeting shall be issued in accordance with Article 76 of the Articles of Association, notifying all shareholders whose names appear in the register of members for such class of the matters proposed to be considered and the date and venue of the meeting. Any other specific requirements as stipulated by the listing rules of the place where shares of the Company are listed shall prevail.

• Article 72 Notices of class meetings shall only be served on the shareholders who are entitled to vote thereat.

• Class meetings shall follow the procedures that are most similar to those of shareholders’ meetings, and the terms in the Articles of Association that are related to the convening and holding procedures of shareholders’ meetings shall apply to class meetings.

• Article 73 Except holders of other classes of shares, holders of domestic shares and holders of overseas-listed foreign shares are deemed to be different class shareholders.

VI – 24

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

The special procedures for voting of class shareholders shall not apply in the following circumstances:

• (1) Upon the approval by way of a special resolution passed by a shareholders’ meeting, the Company issues domestic shares and overseas-listed foreign shares, either separately or concurrently, every twelve months, provided that the number of domestic shares and overseas-listed foreign shares to be issued each does not exceed 20% of the outstanding shares of each class;

• (2) The Company’s plan to issue domestic shares and overseas-listed foreign shares at the time of its establishment, which is completed within fifteen months from the date of approval of the securities regulatory authorities under the State Council; or

• (3) Upon the approval of the securities regulatory authorities under the State Council, holders of the Company’s domestic shares transfer the shares they hold to overseas investors or convert such shares into overseaslisted foreign shares, and these shares are listed and traded on overseas stock exchanges.

CHAPTER 7 SUPPLEMENTARY PROVISIONS

Article 74 The terms ‘‘more than’’ and ‘‘less than’’ referred to in the Rules include the underlying number, while the term ‘‘other than’’, or ‘‘except’’, does not include the underlying number.

Other meanings ascribed to the terms stated above by the Rule shall prevail.

• Article 75 Matters not covered in the Rules shall follow relevant laws, regulations, the listing rules in the place where the Company’s shares are listed and relevant provisions of the Articles of Association. In case of any matters covered herein being in conflict with the relevant laws, regulations, the listing rules of the place where the Company’s shares are listed and the Articles of Association that are enacted or amended in the future, such relevant laws, regulations, the listing rules of the place where the Company’s shares are listed and the current or amended Articles of Association shall prevail.

• Article 76

The Board shall be responsible for the interpretation of the Rules.

VI – 25

APPENDIX VI

RULES OF PROCEDURES FOR THE MEETINGS OF SHAREHOLDERS

Article 77

The Rules, as an annex to the Articles of Association, shall be subject to the consideration and approval of the Shareholders’ meeting of the Company and shall take effect from the date on which A Shares of the Company under the initial public offering are listed on the Shanghai Stock Exchange.

VI – 26

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

CHAPTER 1 GENERAL PROVISIONS

• Article 1 In order to standardize the decision-making procedures of the Board of Directors of MicroTech Medical (Hangzhou) Co., Ltd. (hereinafter referred to as the ‘‘Company’’), establish a sound corporate governance structure, and ensure a legal, scientific and systematic decision-making of the Board of Directors, the Rules are hereby established in accordance with 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, the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, the Rules Governing the Listing of Stocks on the Science and Technology Innovation Board of the Shanghai Stock Exchange and the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (hereinafter referred to as the ‘‘Articles of Association’’) and other relevant provisions.

• Article 2 The Company established a Board of Directors, which is the permanent business decision-making body of the Company and is responsible to the shareholders’ meeting, and exercises decision-making power within the scope of the Company Law, the Articles of Association and the terms of reference granted by the shareholders’ meeting.

CHAPTER 2 BOARD OF DIRECTORS AND ITS COMMITTEES

• Article 3 The Board of Directors of the Company shall comprise 10 Directors and shall have one chairman, four of which are independent non-executive Directors. Independent non-executive Directors shall constitute at least one third of the Board members with at least one accounting professional.

• Article 4 Directors shall be elected at the shareholders’ meetings for a term of three years. Upon maturity of the term of office, a Director shall be eligible to offer himself for re-election and re-appointment.

• The election and removal of the chairman shall be approved by more than half of all Directors. The chairman shall serve for a term of three years and may be re-elected.

• Article 5 A Director may resign before expiration of his term of office. The resigning Director shall submit a written resignation to the Board of Directors. The Board of Directors will disclose the relevant information within two days.

VII – 1

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

In the event that the resignation of any Director results in the number of members of the Board of Directors to be less than the statutory minimum requirement, the said Director shall perform duties as Director pursuant to the laws, administrative regulations, regulatory documents and the Articles of Association until an elected Director assumes his/her office.

Save for the circumstances as referred to in the preceding paragraph, the resignation of a Director shall become effective upon submission of his resignation to the Board of Directors.

• Article 6 The Board of Directors consists of the Audit Committee, the Nomination Committee, the Remuneration and Appraisal Committee, and the Strategy Committee, whose members are elected by the Board of Directors. The Board of Directors may establish other special committees and adjust the existing committees according to its needs.

• Article 7 The Company shall provide adequate resources and support, as well as cooperate with special committees in order to perform their duties. The committees may, if necessary, engage professional organizations to seek independent professional advice when performing their duties, at the expense of the Company.

CHAPTER 3 BOARD MEETINGS

• Article 8 Board meetings include regular meetings and extraordinary meetings. Board meetings shall be convened at least four times a year and be called for by the chairman. The notice of the regular meeting of the Board of Directors shall be given not less than 14 days in advance, and the notice of the extraordinary meeting shall be given not less than 5 days in advance. However, in the event of emergency for which an extraordinary meeting of the Board of Directors needs to be held as soon as possible, the notice may be given by telephone or other verbal means at any time, provided that the convener shall give an explanation at the meeting therefor.

• Article 9 Before issuing a notice on convening a regular Board meeting, the Secretary to the Board of Directors shall fully solicit the opinions of all Directors, and submit a preliminary meeting proposal to the chairman for formulation.

The chairman shall seek the opinion of the general manager and other senior management as necessary before formulating a proposal.

VII – 2

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

Article 10

An extraordinary Board meeting shall be convened under any of the following circumstances:

• (1) when proposed by shareholders representing more than one tenth of the voting rights;

• (2) when jointly proposed by more than one-third of the Directors;

• (3) when proposed by the Supervisory Committee;

• (4) when the chairman of the Board of Directors deems it necessary;

• (5) when proposed by more than half of the independent non-executive Directors;

• (6) when proposed by the general manager.

Article 11

If it is proposed to hold an extraordinary board meeting in accordance with the provision of the preceding article, a written proposal signed (sealed) by the proposer shall be submitted through the Secretary to the Board of Directors or directly to the chairman of the Board. The followings shall be stated in the written proposal:

• (1) the name of the proposer;

• (2) the reasons for the proposal or the objective reasons on which the proposal is based;

• (3) the time or duration, place and form of the meeting proposed;

• (4) definite and specific proposals;

• (5) contact information of the proposer and the proposal date, etc.

The content of the proposal shall be within the scope of the authority of the Board of Director as specified in the Articles of Association, and the materials related to the proposal shall be submitted together with the proposal.

The Secretary to the Board of Directors shall forward the above written proposal and related materials to the chairman on the same day. If the chairman believes that the content of the proposal is unclear, unspecific or the relevant materials are insufficient, he/she may request the proposer to revise or supplement it.

VII – 3

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

The chairman shall convene a Board meeting and preside over it within ten days after receiving the proposal.

Article 12 Board meetings shall be convened and presided over by the chairman; if the chairman is unable to perform his duties or does not perform his duties, the meeting shall be convened and presided over by a Director jointly nominated by more than half of the Directors.

Article 13 The notice of extraordinary meetings convened by the Board of Directors may be given by hand, mail, fax, or telephone.

The notice of meeting shall be deemed to have been issued to a Director if he is present at the meeting and does not raise an objection to the non-receipt of such notice prior to or at the meeting.

Regular meetings or extraordinary meetings of the Board of Directors may be held by way of teleconference, video conference or similar communication equipment. The Directors attending a meeting by such means shall be deemed to be present at the meeting in person, provided that all Directors present at the meeting can hear and communicate with each other.

Unless otherwise specified by laws and regulations or the listing rules of the jurisdiction where the shares of the Company are listed, the Board of Directors may adopt a written resolution to replace the Board meeting. A written resolution shall be deemed to be passed upon signature of Directors of proper proportion forming the quorum for a Board of Directors stipulated by laws and regulations and the Articles of Association. Such written resolutions shall be filed together with Board meeting minutes and other archives of the Company, and shall have the same binding force and validity as the resolutions made by Directors attending Board meetings in person.

VII – 4

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

Article 14

A written meeting notice shall at least include the following content:

• (1) the time and place of the meeting;

• (2) the form of the meeting;

• (3) the matters (meeting proposal(s)) to be considered;

• (4) convener and chairman of the meeting, proposer of and written proposal(s) for the extraordinary meeting;

• (5) documents necessary for the voting of Directors;

• (6) requirements for the Directors to attend the meeting in person or by proxy;

• (7) contact person and contact details.

The verbal meeting notice shall at least include the information of the aforesaid items (1) and (2) and the explanations on holding the extraordinary meeting of the Board of Directors in the event of emergency situation.

Article 15 After the written notice for the regular meeting of the Board of Directors is issued, if the time or place to convene the meeting shall be changed or the meeting proposal(s) shall be added, changed or cancelled, the written notice of change shall be issued three days before the originally scheduled meeting date, specifying the situation and relevant content and materials about the new proposal(s). If it is less than three days in advance, the date of the meeting shall be postponed accordingly or held as scheduled upon the approval of all Directors present.

Where, after sending out the notice of the extraordinary meeting of the Board of Directors, there is a need to change the time or place of the meeting, or to add, change or cancel the meeting proposal(s), the approval of all Directors present shall be obtained in advance and records thereof shall be made.

Article 16 Meetings of the Board of Directors shall be held only if more than half of the Directors (including Directors in proxy in according with Article 18 of the Rules) attend.

VII – 5

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

Voting of resolutions of the Board of Directors shall proceed by voting by a show of hands or voting by poll. Extraordinary meetings of the Board of Directors may be conducted by way of fax or circulation and resolutions may be passed thereat provided that the Directors shall have fully expressed their views and the directors attending the meeting shall sign accordingly.

Supervisors may attend Board meetings. General manager and the Secretary to the Board who are not a Director shall attend the Board meetings. The chairman of the meeting may, where he/she deems necessary, notify other relevant persons to attend Board meetings.

Article 17

The Directors shall attend the Board meeting by themselves. If a Director is unable to attend for any reason, he/she may appoint another director to attend the meeting on his/her behalf by a written power of attorney specifying the proxy’s name, entrusted matters, scope of authorization and validity period, which shall be signed or sealed by the entrusting party.

The Director attending the meeting on other’s behalf shall only exercise the rights of a Director within the scope of authorization. If a Director fails to attend a board meeting or appoint a representative to attend on his/her behalf, such Director shall be deemed to have waived his right to vote at such meeting.

Article 18

Proxy attendance at Board meetings shall follow the principles below:

• (1) in the consideration of related/connected transactions, a non-related/ connected Director shall not appoint a related Director to attend on his/ her behalf; nor shall a related/connected Director accept the proxy from a non-related/connected Director;

• (2) an independent non-executive Director shall not appoint a nonindependent non-executive Director to attend the meeting on his/her behalf, nor shall a non-independent non-executive Director accept the proxy from an independent non-executive Director;

• (3) a Director shall not give his/her absolute authority to another Director to attend the meeting on his/her behalf without stating his/her personal opinion and intention to vote on the proposal(s), nor shall such Director accept a proxy with absolute authority and authority which is unclear;

VII – 6

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

• (4) a Director shall not accept a proxy from more than two Directors, nor shall a Director appoint a Director who has accepted a proxy from two other Directors to attend the meeting on his/her behalf.

Article 19 The chairman of the meeting shall request the Directors present at the Board meetings to express definite opinions on various proposals. For any proposal requiring prior acknowledgements of independent non-executive Directors, the chairman of the meeting shall, before discussing the relevant proposal(s), appoint one independent non-executive Director to read out the written acknowledgements of independent non-executive Directors.

• If a Director obstructs the normal conduct of the meeting or affects the speech of other Directors, the chairman of the meeting shall stop such act in a timely manner. Except with the unanimous consent of all attending Directors, the Board meetings shall not vote on proposals not included in the meeting notice. If a Director accepts the entrustment of other Directors to attend the Board meetings as a proxy, he/she shall not vote on the proposals not included in the meeting notice on behalf of the other Directors.

• Article 20 Directors shall carefully read the relevant meeting materials and express their opinions independently and prudently on the basis of full understanding of the situation.

• Prior to the meeting, Directors may learn about the information necessary for decision-making from the office of the Board, the convener of the meeting, the general manager and other senior management, each special committee, accounting firms and law firms and other relevant personnel and institutions, and may also propose to the chairman during the meeting to invite representatives of the above-mentioned personnel and institutions present at the meeting to explain the relevant situation.

• Article 21 After each proposal has been fully discussed, the chairman shall submit it to the attending Directors for voting in due course.

Each one shall have one vote when voting at the meeting, by a show of hands or by open ballot.

VII – 7

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

The voting intention of Directors is divided into affirmative, negative and abstention. The attending Directors shall choose one of the above intentions. If a Director does not make a choice or simultaneously chooses two or more intentions, the chairman of the meeting shall require the relevant Director to make a new choice. If he/she refuses to make a choice, he/she shall be deemed as abstaining from voting. Those who leave the meeting venue halfway and do not return without making a choice shall be deemed as abstaining from voting.

• Article 22 After the attending Directors completing the voting procedures, the relevant staff of the office of the Board shall collect the ballots cast by the Directors in a timely manner, and the Secretary to the Board shall make statistics under the supervision of a supervisor or an independent non-executive Director.

• If a meeting is held on-site, the chairman of the meeting shall announce the statistical results on the spot; in other cases, the chairman of the meeting shall require the Secretary to the Board to notify the Directors of the voting results before the next working day after the end of the prescribed voting time limit.

• If a Director casts a vote after the chairman of the meeting announces the voting results or after the prescribed voting time limit expires, his/her voting results will not be counted.

• Article 23 When a Board meeting considers and approves a proposal and forms a relevant resolution, it is required that more than half of all Directors of the Company vote in favor of the proposal. Where laws, administrative regulations, the listing rules of the place where the shares of the Company are listed and the Articles of Association stipulate that the Board of Directors shall obtain the consent of more Directors to form a resolution, such provisions shall prevail.

• In case of conflict in content and meaning of different resolutions, the resolution formed later shall prevail.

• Article 24 In any of the following circumstances, the Directors shall abstain from voting on relevant proposals, nor shall he/she exercise voting rights on behalf of other Directors:

• (1) a Director who is related/connected with an enterprise involved in the meeting proposal(s) shall not vote pursuant to the Articles of Association and other internal administrative rules;

• (2) the Directors think they should abstain from voting;

VII – 8

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

• (3) there is a material interest relationship or other situations as provided in the laws and regulations and the listing rules of the place where the shares of the Company are listed.

Such Board meeting may be held with the quorum of more than half of the non-connected Directors and resolutions at the Board meeting shall be passed by more than half of the non-connected Directors. Where the number of nonconnected Directors present at the Board meeting is less than three, the matter shall be submitted to the shareholders’ meeting for consideration.

Article 25 Where more than half of the Directors attending the meeting or more than two independent non-executive Directors consider that the proposals are unclear or unspecific, or that documents of the meeting are so inadequate that they are unable to make a judgement on the relevant matters, the chairman of the meeting shall require the subject matters to be postponed for voting at the meeting.

The Directors who suggest suspending the voting shall put forward specific requirements necessary for the resubmission of a proposal.

• Article 26 The Board of Directors shall record the decisions on the matters discussed at the meeting as minutes. Minutes of Board meetings shall record in sufficient detail the matters considered and decisions reached at the meetings, including any concerns raised or dissenting views expressed by Directors. Draft and final versions of minutes shall be sent to all Directors for their comments and for records respectively, within a reasonable time after the Board meeting is held.

• Article 27 The Directors and recorder attending the meeting shall sign the minutes. The minutes of meetings shall be kept for at least ten years. Directors shall be liable for the resolutions of the Board of Directors. If the resolutions of the Board of Directors violate the laws, administrative regulations or the Articles of Association, and the Company suffers a material loss as a result thereof, the Directors participating in the resolutions are liable to the Company for the losses. However, Directors may be exempted from such liability if it is verified that such Directors have stated their objection when voting and the same was recorded in the minutes of the Board meeting.

A Director shall be deemed to be in full agreement with the contents of the minutes and resolutions if he/she neither signs the name nor gives a written explanation of his/her dissenting opinion as required by the preceding article.

VII – 9

APPENDIX VII

RULES OF PROCEDURES FOR THE BOARD OF DIRECTORS

Article 28

The Board of Directors shall record the decisions on the matters discussed at the meeting as minutes. Meeting minutes shall include the following content:

• (1) the date and venue for convening the meeting and the name of the convener;

• (2) the names of the Directors present and the names of Directors (proxies) appointed by others to attend the meeting;

• (3) the agenda of the meeting;

• (4) the key points of the Directors’ speeches;

• (5) the voting methods and results of each resolution (voting results shall indicate the number of affirmative, negative and abstention votes).

• Article 29 Unless otherwise specified by laws and regulations or the listing rules of the place where the shares of the Company are listed, the Board of Directors may adopt a written resolution to replace the Board meeting. A written resolution shall be deemed to be passed upon the endorsement of Directors of proper proportion forming the quorum for a Board of Directors as stipulated by laws and regulations and the Articles of Association. Such written resolutions shall be filed together with Board meeting minutes and other archives of the Company, and shall have the same binding force and validity as the resolutions made by Directors attending Board meetings in person.

CHAPTER 4 SUPPLEMENTARY PROVISIONS

Article 30 The term ‘‘more than’’ as referred to in the Rule is inclusive.

• Article 31 Matters not covered in the Rules shall follow relevant laws, regulations, the listing rules in the place where the Company’s shares are listed and relevant provisions of the Articles of Association. In case of any matters covered herein being in conflict with the relevant laws, regulations, the listing rules of the place where the Company’s shares are listed and the Articles of Association that are enacted or amended in the future, such relevant laws, regulations, the listing rules of the place where the Company’s shares are listed and the current or amended Articles of Association shall prevail.

• Article 32 The authority of interpretation of the Rules shall be vested to the Board.

• Article 33 The Rules, as an annex to the Articles of Association, shall be subject to the consideration and approval of the Shareholders’ meeting of the Company and shall take effect from the date on which the Company’s A shares issued under the initial public offering are listed on the Shanghai Stock Exchange.

VII – 10

APPENDIX VIII

RULES OF PROCEDURES FOR THE SUPERVISORY COMMITTEE

• Article 1 In order to clarify the duties and authority of the Supervisory Committee of MicroTech Medical (Hangzhou) Co., Ltd. (hereinafter referred to as the ‘‘Company’’), standardize the internal organization and operation procedures of the Supervisory Committee, and give full play to the supervisory function of the Supervisory Committee, the Rules are hereby established in accordance with the Company Law of the People’s Republic of China, the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, the Rules Governing the Listing of Stocks on the Science and Technology Innovation Board of the Shanghai Stock Exchange and the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (hereinafter referred to as the ‘‘Articles of Association’’) and other relevant provisions.

• Article 2 The Company established the Supervisory Committee in accordance with the laws. The Supervisory Committee consists of 3 supervisors, of which 2 are shareholder representative supervisors and 1 is employee representative supervisor. The shareholder representative supervisors shall be subject to election and dismissal by the shareholders’ meeting. The employee representative supervisors shall be subject to election by employees of the Company at employee meetings, employee representative meetings or any other form of democratic election. The Supervisory Committee is authorised by the shareholders’ meeting to supervise the operation and management of the Company. As a supervisory body of the Company, the Supervisory Committee is responsible to the shareholders’ meeting and exercises its power in accordance with the Articles of Association.

• Article 3 The meetings of the Supervisory Committee are divided into regular meetings and extraordinary meetings.

The Supervisory Committee shall convene a regular meeting every six months. Supervisors may propose to hold extraordinary meetings of the Supervisory Committee.

• Article 4 Before issuing a notice on convening a regular meeting of the Supervisory Committee, the person in charge of daily affairs of the Supervisory Committee shall solicit meeting proposals from the supervisors and may ask for opinions from the staff of the Company. When soliciting proposals and opinions, the person in charge of daily affairs of the Supervisory Committee should explain that the Supervisory Committee focuses on the supervision over the Company’s standard operation and the duties of Directors and the senior management rather than the decision-making on the Company’s operation and management.

VIII – 1

APPENDIX VIII

RULES OF PROCEDURES FOR THE SUPERVISORY COMMITTEE

Article 5

Where a supervisor proposes to hold an extraordinary meeting of the Supervisory Committee, a written proposal signed by the proposing supervisor shall be submitted through the person in charge of daily affairs of the Supervisory Committee or directly to the chairman of the Supervisory Committee. The followings should be stated in the written proposal:

• (1) the name of the proposing supervisor;

• (2) the reasons for the proposal or the objective reasons on which the proposal is based;

• (3) the time or duration, place and form of the meeting proposed;

• (4) definite and specific proposals;

• (5) contact information of the proposing supervisor and the proposal date, etc.

The person in charge of daily affairs of the Supervisory Committee shall issue the notice of extraordinary meeting of the Supervisory Committee within five days after the person in charge of daily affairs of the Supervisory Committee or chairman of the Supervisory Committee receives the written proposal of the supervisor.

Article 6 The meetings of the Supervisory Committee shall be convened and presided over by the chairman of the Supervisory Committee; if the chairman of the Supervisory Committee is unable to perform his duties or does not perform his duties, the meeting shall be convened and presided over by a supervisor jointly nominated by more than half of the supervisors.

• Article 7 The notice of the regular meeting of the Supervisory Committee shall be given not less than fourteen days in advance, and the notice of the extraordinary meeting shall be given not less than five days in advance, and shall be delivered by hand, mail, fax or other written means. However, in the event of emergency for which an extraordinary meeting needs to be held as soon as possible, the notice may be given by telephone or other verbal means at any time, provided that the convener shall give an explanation at the meeting therefor.

VIII – 2

APPENDIX VIII

RULES OF PROCEDURES FOR THE SUPERVISORY COMMITTEE

Article 8

A written notice of meeting shall at least include the following content:

• (1) date, venue and duration of the meeting;

• (2) purposes and matters to be discussed;

• (3) date of issue of the notice.

Article 9 Regular meetings or extraordinary meetings of the Supervisory Committee may be held by way of teleconference, video conference or similar communication equipment. The supervisors attending a meeting by such means shall be deemed to be present at the meeting in person, provided that all supervisors present at the meeting can hear and communicate with each other.

Article 10 A meeting of the Supervisory Committee shall be convened only when more than two-thirds of the supervisors are present. Article 11 The meetings of the Supervisory Committee shall be attended by the supervisors themselves. If a supervisor is unable to attend for some reason, he/she may authorize other supervisors in writing to attend the meeting on his/ her behalf. The proxy’s name, entrusted matters, scope of authorization and validity period shall be set out in the power of attorney, which shall be signed or sealed by the entrusting party.

The supervisor attending the meeting as a proxy of another supervisor shall exercise the rights of a supervisor within the scope of authorization.

If a supervisor fails to attend a meeting of the Supervisory Committee and does not authorize a representative to attend it, he/she shall be deemed to have waived his/her right to vote at the meeting.

Article 12 The chairman of the meeting shall request the attending supervisors to express definite opinions on various proposals. The chairman of the meeting shall, according to the supervisor’s proposal, request the Directors, the senior management, other employees of the Company or staff of relevant intermediaries to attend the meeting for answering the inquiries. Article 13 Voting at the meetings of the Supervisory Committee shall be carried out in the form of one person, one vote, by a show of hands or by open ballot.

VIII – 3

APPENDIX VIII

RULES OF PROCEDURES FOR THE SUPERVISORY COMMITTEE

The voting intention of supervisors is divided into affirmative, negative and abstention. The attending supervisors shall choose one of the above intentions. If a supervisor does not make a choice or simultaneously chooses two or more intentions, the chairman of the meeting shall require the supervisor to make a new choice. If he/she refuses to make a choice, he/she shall be deemed as abstaining from voting. Those who leave the meeting venue halfway and do not return without making a choice shall be deemed as abstaining from voting.

Resolutions of the Supervisory Committee shall be passed by more than twothirds of the members of the Supervisory Committee.

Article 14

The person in charge of daily affairs of the Supervisory Committee shall keep the minutes of on-site meetings. The meeting minutes shall include the following content:

• (1) the meeting session, and the date and venue for and form of convening the meeting;

• (2) the delivery of the meeting notices;

• (3) convener and chairman of the meeting;

• (4) meeting attendance;

• (5) the proposals reviewed at the meeting, the main points and main opinions of each supervisor on relevant matters, and the voting intention on the proposals;

• (6) the voting method and results of each proposal (indicating the specific number of affirmative, negative and abstention votes);

• (7) other matters that the attending supervisors think shall be recorded.

Article 15

The Supervisory Committee may adopt a written resolution to replace the meeting of the Supervisory Committee. A written resolution shall be deemed to be passed upon the endorsement of supervisors of proper proportion forming the quorum for a Supervisory Committee as stipulated by Article 13. Such written resolutions shall be filed together with the minutes of the Supervisory Committee meeting and other archives of the Company, and shall have the same binding force and validity as the resolutions made by supervisors attending the meeting of the Supervisory Committee in person.

VIII – 4

APPENDIX VIII

RULES OF PROCEDURES FOR THE SUPERVISORY COMMITTEE

• Article 16 Attending supervisors shall sign and confirm the minutes of the meeting. Supervisors have the right to request that certain explanatory records be made on the minutes of their speeches at the meeting.

• Article 17 Supervisors shall urge relevant personnel to implement the resolutions of the Supervisory Committee. The chairman of the Supervisory Committee shall notify the implementation of the resolutions that have been formed at subsequent meetings of the Supervisory Committee.

• Article 18 The person designated by the chairman of the Supervisory Committee shall be responsible for keeping archives of the meetings of the Supervisory Committee, including meeting notices and meeting materials, meeting attendance books, voting ballots, meeting records signed and confirmed by attending supervisors.

• The meeting materials of the Supervisory Committee shall be kept as Company archives for at least ten years.

• Article 19 In the Rules, the term ‘‘no less than’’ shall include the underlying number.

• Article 20 Matters not covered in the Rules shall follow relevant laws, regulations, the listing rules in the place where the Company’s shares are listed and relevant provisions of the Articles of Association. In case of any matters covered herein being in conflict with the relevant laws, regulations, the listing rules of the place where the Company’s shares are listed and the Articles of Association that are enacted or amended in the future, such relevant laws, regulations, the listing rules of the place where the Company’s shares are listed and the current or amended Articles of Association shall prevail.

• Article 21 The Rules shall be interpreted by the Supervisory Committee of the Company.

• Article 22 The Rules, as an annex to the Articles of Association, shall be subject to the consideration and approval of the Shareholders’ meeting of the Company and shall take effect from the date on which the Company’s A shares issued under the initial public offering are listed on the Shanghai Stock Exchange.

VIII – 5

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

APPENDIX IX

CHAPTER 1 GENERAL PROVISIONS

• Article 1

• In order to improve the governance structure of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’), promote the standardized operation of the Company, and safeguard the interests of the Company and its shareholders, the System is hereby established in accordance with the Company Law of the People’s Republic of China, the Rules for Independent Directors of Listed Companies (the ‘‘Rules for Independent Directors’’), the Rules Governing the Listing of Shares on the Science and Technology Innovation Board of the Shanghai Stock Exchange (the ‘‘Sci-Tech Board Listing Rules’’), Guidelines for Self-regulation of Listed Companies in Science and Technology Innovation Board of Shanghai Stock Exchange No. 1 – Standardized Operation (the ‘‘Guidelines for Standardized Operation’’), the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Articles of Association’’) and the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited (the ‘‘Hong Kong Listing Rules’’) and other relevant provisions, taking into account the Company’s actual situation.

• Article 2 Independent non-executive directors refer to directors who do not hold positions other than directors in the Company and do not have a relationship with the Company and its major shareholders that may prevent them from making independent and objective judgments. The qualifications for independent non-executive directors must meet the requirements of the Hong Kong Listing Rules and must be approved by the relevant regulatory authorities.

• Article 3 Independent non-executive directors bear the duty of integrity and fiduciary to the Company and all shareholders. Independent non-executive directors shall conscientiously perform their duties, safeguard the overall interests of the Company, and especially hold the legitimate rights and interests of minority shareholders harmless from and against any damage in accordance with the requirements of relevant laws, administrative regulations, the Rules for Independent Directors, the Sci-Tech Board Listing Rules, the Guidelines for Standardized Operation, the Hong Kong Listing Rules, the Articles of Association and the System. Independent non-executive directors are required to make positive contributions to the formulation of the Company’s strategies and policies by providing independent, constructive and informed advice.

• Article 4 Independent non-executive directors shall perform their duties independently, and shall not be affected by the Company’s major shareholders, de facto controller or other units or individuals with a stake in the Company.

IX – 1

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

Article 5

Independent non-executive directors shall ensure that they have sufficient time and energy to effectively perform their duties as independent non-executive directors.

Article 6 The Company shall appoint (at least three) independent non-executive directors, representing at least one-third of the Board of the Directors. The Company’s independent non-executive directors must include at least one person with appropriate professional qualifications that meet the requirements of the securities regulatory authority of the place where the Company’s shares are listed, or have the appropriate accounting or related financial management expertise. The candidates for independent non-executive director being nominated in the capacity of finance or accounting professionals shall have extensive professional knowledge and experience in accounting or related financial management and meet at least one of the following conditions:

• (1) possessing the qualification of certified public accountant in Hong Kong and/or Mainland China;

• (2) obtaining a senior professional title, associate professor title or doctoral degree in accounting, auditing or financial management;

• (3) having a senior professional title in economic management or internal monitoring, with more than five years of full-time work experience in accounting, auditing or financial management, and other professional positions.

At least one of the Company’s independent non-executive directors is ordinarily resident in Hong Kong.

Article 7 When independent non-executive directors fail to meet the conditions for independence or are otherwise unsuitable for performing their duties as independent non-executive directors, resulting in the number of independent non-executive directors of the Company failing to meet the requirements of the Listing Rules of the listing place, the Company shall make up for the number of independent non-executive directors as required.

Article 8

Independent non-executive directors and persons who intend to serve as independent non-executive directors shall participate in the training as required and recognized by the Listing Rules of the listing place and other laws and regulations.

IX – 2

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

CHAPTER 2 QUALIFICATIONS OF INDEPENDENT NON-EXECUTIVE DIRECTORS

Article 9 Persons serving as independent non-executive directors of the Company shall meet the following basic conditions:

• (1) being qualified to serve as a director of the Company in accordance with laws, regulations, other regulatory documents, Listing Rules of the listing place and other relevant provisions;

• (2) having the independence as required by the Listing Rules of the listing place and the System;

• (3) possessing the basic knowledge of the operation of a listed company, and being familiar with relevant laws, administrative regulations, rules and regulations;

• (4) having work experience of more than five years in legal, economic or other aspects necessary to perform the duties of independent nonexecutive directors;

• (5) possessing the personality, experience and character suitable for serving as a director of a listed company and proving that they are sufficiently qualified for the position; and

• (6) Other conditions as stipulated by the Articles of Association and the securities regulatory rules of the listing place.

Article 10 Independent non-executive directors shall have independence. The following person(s) shall not serve as an independent non-executive director:

• (1) any person who holds a position in the Company or any of its subsidiaries and his/her immediate family members and major social relations (immediate family members refer to spouses, parents, children, etc.; main social relations refer to siblings, parents of spouses, spouses of children, spouses of siblings, siblings of spouses, etc., the same below);

• (2) any natural person shareholder who directly or indirectly holds more than 1% of the issued shares of the Company or is one of the top ten shareholder of the Company, and any immediate family member of such natural person shareholder;

IX – 3

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

• (3) any person who is employed by any shareholder who directly or indirectly holds more than 5% of the issued shares of the Company or is one of the top five shareholders of the Company, and any immediate family member of such person;

• (4) any person who is employed by any of the controlling shareholder, the de facto controller of the Company and any of its subsidiary, and any immediate family member of such person;

• (5) any person who serves as a director, supervisor or senior executive of an entity that has material business dealings (material business dealings refer to matters that need to be submitted to the shareholders’ meeting for consideration according to the Sci-Tech Board Listing Rules and the Articles of Association) with the Company and any of its controlling shareholder, de facto controller and subsidiary, or of the controlling shareholder of such entity;

• (6) any person who has a material interest in any major business activity of the Company, its holding company, or its respective subsidiaries; or involves in material business transactions with the Company, its holding company, or its respective subsidiaries or with any core related person of the Company (as defined in the Listing Rules of the Stock Exchange, the same below);

• (7) any person who falls within any of the foregoing six circumstances at that time or within 1 year immediately prior to the date of his/her proposed appointment as an independent non-executive director;

• (8) any person who receives any interests in the securities of the Company as a gift or by means of other financial assistance from a core connected person or the Company;

• (9) any person who, at that time or within 2 years immediately prior to the date of his/her proposed appointment as an independent non-executive director, provides financial, legal, consulting and other services for the Company and its controlling shareholder or their respective subsidiaries or any of its directors, supervisors, chief executive, the major shareholder or any such person’s close associates (as defined in the Listing Rules of the Stock Exchange, the same below), including all the project team personnel of the intermediary agencies providing services, reviewers at all levels, personnel who sign the reports, partners, principal responsible persons and directors;

IX – 4

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

• (10) any person who is on the board for the purpose of protecting the interests of an entity and whose interests are not the same as those of the shareholders as a whole;

• (11) any person who is or was connected with a director, the chief executive or a substantial shareholder of the Company within 2 years immediately prior to the date of his/her proposed appointment as independent nonexecutive director;

• (12) any person who is, or has at any time during the 2 years immediately prior to the date of his/her proposed appointment been, an executive or a director (other than an independent non-executive director) of the Company, of its holding company or of any of their respective subsidiaries or of any core connected persons of the Company;

• (13) any person who is financially dependent on the Company, its holding company or any of their respective subsidiaries or core connected persons of the Company;

• (14) any person who is banned from entering the securities market by the CSRC and still in the period of being banned from entering;

• (15) any person who is publicly deemed unfit to serve as a director of a listed company by the stock exchange;

• (16) any person who is punished by the CSRC in the last three years;

• (17) any person who has been openly reprimanded or criticized by notice for more than two times by the stock exchange in the last three years;

• (18) any person who failed to attend two consecutive meetings of the Board or failed to attend in person more than one-third of the meetings of the Board during his/her tenure as an independent non-executive director;

• (19) any person who has expressed independent views that are clearly inconsistent with the facts during his/her tenure as an independent nonexecutive director; and

• (20) any other person who is not allowed to serve as independent nonexecutive directors of the Company as stipulated by laws and regulations, the securities regulatory agency of the place where the Company’s shares are listed, and the Articles of Association.

IX – 5

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

Article 11 After the appointment, each independent non-executive director shall inform the Company and The Stock Exchange of Hong Kong Limited (the ‘‘Hong Kong Stock Exchange’’) as soon as practicable if there is any subsequent change of circumstances which may affect his/her independence and must provide an annual confirmation of his/her independence to the Company. The Company must confirm in each of its annual reports whether it has received such confirmation and whether it still considers the independent non-executive director to be independent.

CHAPTER 3 NOMINATION, ELECTION AND REPLACEMENT OF INDEPENDENT NON-EXECUTIVE DIRECTORS

Article 12 The Board of Directors, the Supervisory Committee, and shareholder(s) of the Company individually or jointly holding more than 1% of the Company’s issued shares (the ‘‘Nominator’’) may propose candidates for independent non-executive directors, which will be decided by the shareholders’ meeting.

Article 13 The Nominator of an independent non-executive director shall obtain the consent of the nominee before nomination. The Nominator shall fully understand the nominee’s occupation, education background, professional title, detailed work experience and all part-time jobs, and express his/her opinions on the nominee’s qualification and independence as an independent nonexecutive director. The nominee shall make a public statement that there is no relationship between him/her and the Company that affects his/her independent and objective judgment. Before the convening of the shareholders’ meeting for electing independent non-executive directors, the Board of Directors of the Company shall announce the above-mentioned contents in accordance with the regulations.

• Article 14 If the Nominator intends to nominate the candidate(s) for independent nonexecutive director, the Company shall, within two trading days from the date of confirmation of the nomination, submit the relevant materials of the candidate(s) for independent non-executive director to the stock exchange in accordance with the relevant regulations of the stock exchange. If the Board of Directors of the Company has any objection to the relevant situation of the candidate(s) for independent non-executive director nominated by the Board of Supervisors or the Board of Directors of the Company, it shall simultaneously submit the written opinions of the Board of Directors to the stock exchange. A Nominator who has objections to the stock exchange may not stand as the candidate(s) for independent non-executive director, but may stand for election as a director.

IX – 6

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

• Article 15

After being elected by the shareholders’ meeting, independent non-executive directors shall, in accordance with the relevant provisions of the Hong Kong Listing Rules, submit to the Stock Exchange of Hong Kong the Form H Declaration and Undertaking with regard to Directors as soon as possible, together with a written confirmation explaining the following matters:

• (1) whether they are of independence as described in the System and the relevant terms of the Hong Kong Listing Rules;

• (2) their past or present financial or other interest in the business of the Company or its subsidiaries or any connection with any core connected person of the Company, if any; and

• (3) whether there are any factors that may affect their independence at the same time as the submission of the Form H Declaration and Undertaking with regard to Directors.

• Article 16 Independent non-executive directors have the same term of office as other directors. After the term expires, they can be re-elected, but the term of reelection shall not exceed six years.

• Article 17 If an independent non-executive director fails to attend the board meeting in person for three consecutive times, nor entrusts other directors to attend, or has other serious dereliction of duty, the Board of Directors and the Supervisory Committee may request the shareholders’ meeting for replacement. Unless the occurrence of the above circumstances and other circumstances in which an independent non-executive director is prohibited from serving as an independent non-executive director as stipulated in the Company Law and the securities regulatory rules of the place where the Company’s shares are listed, an independent non-executive director shall not be dismissed without reason before the term of office expires. In case of early dismissal, the Company shall disclose it as a special disclosure matter. If the dismissed independent non-executive director believes that the reason for the dismissal determined by the Company is inappropriate, he/she may make a public statement.

• Article 18 An independent non-executive director may resign before the expiration of his/ her term of office. An independent non-executive director who resigns shall submit a written resignation report to the Board of Directors, explaining the circumstances related to his/her resignation or that he/she deems necessary to bring to the attention of the Company’s shareholders, prospective investors and creditors.

IX – 7

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

• Article 19 If an independent non-executive director of the company fails to meet the qualifications for serving as an independent non-executive director as stipulated after taking office, he/she shall resign as an independent nonexecutive director within 30 days from the date of such occurrence. If he/she fails to resign as required, the Board of Directors of the Company shall initiate a decision-making procedure to remove his/her independent non-executive director position within 2 days.

• Article 20 If the number of independent non-executive directors in the Board of Directors of the Company does not meet the minimum number requirements as stipulated in the System, the securities regulatory rules of the place where the Company’s shares are listed and the Articles of Association due to the resignation or dismissal of independent non-executive directors or other reasons, the Board of Directors shall immediately notify the Hong Kong Stock Exchange and publish an announcement according the securities regulatory rules of the place where the Company’s shares are listed, announcing the relevant details and reasons, and shall appoint a sufficient number of independent non-executive directors within 3 months after it fails to meet the relevant requirements. The resignation report/resignation of the independent non-executive director shall take effect after the vacancy is filled by the next independent non-executive director or other circumstances as stipulated by regulatory rules in the place where the Company’s shares are listed.

Except as specified in the preceding paragraph, the resignation of an independent non-executive director shall take effect when his/her resignation report/resignation is served to the Board of Directors.

CHAPTER 4 RIGHTS AND OBLIGATIONS OF INDEPENDENT NON-EXECUTIVE DIRECTORS

Article 21 Independent non-executive directors, as members of the Board of Directors, have the same status as other directors. The Company shall provide independent non-executive directors with the necessary working conditions to perform their duties, and ensure that independent non-executive directors have the same right to know as other directors. When independent non-executive directors exercise their authorities, the Secretary to the Board of Directors of the Company and other relevant personnel shall actively provide assistance.

IX – 8

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

APPENDIX IX

• Article 22 Independent non-executive directors shall represent more than half of the seats of remuneration, audit, nomination and other relevant committees under the Board of Directors of the Company; the chairpersons of the audit committee and the remuneration committee must be an independent non-executive director.

• Article 23 Independent non-executive directors shall perform their duties independently and shall not be affected by the Company’s major shareholders, de facto controller, or contact persons who have an interest in the Company and its major shareholders or de facto controller.

• Article 24 Independent non-executive directors shall attend the shareholders’ meetings and have an unbiased understanding of the opinions of the Company’s shareholders.

• Article 25 Independent non-executive directors shall hold a meeting with the Chairman of the Board of Directors at least once a year without the presence of the executive directors.

• Article 26 Independent non-executive directors shall regularly and punctually attend the meetings of the Board of Directors and the special committees under the Board of Directors, and actively participate in the affairs of the meetings, read the meeting documents carefully, actively investigate and obtain the conditions and materials required for decision-making, express clear opinions on the matters under consideration in a normal, reasonable, prudent and diligent manner, and contribute to the Company with their professional knowledge, skills and background.

• If the Board of Directors believes that a substantial shareholder or director has a material conflict of interest in a matter to be considered by the Board of Directors, the matter shall be resolved by holding an on-site meeting of the Board of Directors (rather than a written resolution). If neither the independent non-executive directors nor their close associates have a material interest in the transaction, they shall attend the meeting.

• Article 27 If an independent non-executive director is unable to attend the Board of Directors in person for some reason, he shall carefully select a trustee and entrust other independent non-executive directors in writing to attend on his/ her behalf. The entrusting party shall independently bear legal responsibilities.

IX – 9

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

Article 28

Independent non-executive directors shall carefully read the Company’s business and financial reports and public media coverage about the Company, timely understand and continuously pay attention to the Company’s operation and management status, major events that have occurred or may occur at the Company and their impacts, report the problems existing in the Company’s business activities to the Board of Directors in a timely manner, and shall not shirk from their responsibilities on the grounds of not directly engaging in operation and management or not knowing relevant problems and situations.

Article 29 In order to give full play to the role of independent non-executive directors, independent non-executive directors shall, in addition to the authorities conferred on directors by the Company Law and other relevant laws and regulations, the Company shall also grant independent non-executive directors the following special authorities:

• (1) granting prior consent for significant connected transactions (which refers to connected transactions with a total amount of more than RMB3 million or more than 5% of the Company’s recently audited net asset value); engaging an intermediary to issue an independent financial advisory report as the basis for their judgment before making judgment;

• (2) submitting a proposal to the Board of Directors on the employment or dismissal of an accounting firm;

• (3) submitting a proposal to the Board of Directors on convening an extraordinary general meeting;

• (4) proposing to convene a board meeting;

• (5) publicly soliciting voting rights from shareholders before a shareholders’ meeting; and

• (6) independently engaging external audit institutions and consulting institutions to audit and consult on specific matters of the Company;

To exercise the authorities of items (1) to (5) of the preceding paragraph by independent non-executive directors, he/she shall obtain the consent of more than half of all independent non-executive directors; to exercise the authority set out in item (6) of the preceding paragraph, he/she shall be subject to the consent of all independent non-executive directors.

IX – 10

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

Matters in items (1) and (2) shall be submitted to the Board of Directors for discussion only after more than one-half of independent non-executive directors agree.

If the proposals set out in the first paragraph of this Article are not adopted or the above authorities cannot be exercised normally, the listed company shall disclose the relevant information.

Where there are other provisions as stipulated in laws, administrative regulations and by the China Securities Regulatory Commission, such provisions shall prevail.

Article 30 Independent non-executive directors shall express objective and impartial independent opinions on the matters discussed at the shareholders’ meetings or the board meetings of the Company, especially to the Board of Directors, the special Committees under the Board of Directors or the shareholders’ meeting on the following matters:

• (1) connected transactions under the Hong Kong Listing Rules that require independent non-executive directors to review and/or express their opinions;

• (2) other significant transactions under the Hong Kong Listing Rules that are subject to review and/or comment by independent non-executive directors;

• (3) matters that the independent non-executive directors believe may harm the rights and interests of minority shareholders;

• (4) matters that the independent non-executive directors believe may cause significant losses to the Company;

• (5) nomination, appointment and removal of directors;

• (6) appointment or dismissal of the senior management;

• (7) remuneration of the Company’s directors and senior management;

• (8) appointment and dismissal of accounting firms;

• (9) changes in accounting policies, accounting estimates or corrections of major accounting errors due to reasons other than changes in accounting standards;

IX – 11

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

• (10) the Company’s financial and accounting reports which have been issued with non-standard unqualified audit opinions by certified public accountants;

• (11) the plan for the relevant parties to change their undertakings;

• (12) formulating the plans for profit distribution policies, profit distribution and converting capital reserves into capital share, especially it is necessary to pay attention to whether it harms the legitimate rights and interests of small and medium investors;

• (13) material matters that need to be disclosed, such as connected transactions, external guarantees, entrusted wealth management, provision of financial assistance, use of proceeds, development of new businesses, investment in shares and their derivatives, etc.;

• (14) major asset restructuring schemes, equity incentive plans, employee stock ownership plans and share repurchase schemes;

• (15) the Company’s shareholders, de facto controller and their subsidiaries have existing or new loans or other capital transactions with the company with a total amount of more than RMB3 million or more than 5% of the Company’s latest audited net asset value, and whether the Company has taken effective measures to recover the arrears;

• (16) matters relating to corporate strategy, policy, performance, accountability, resources, key appointments and code of conduct of the Company;

• (17) matters with potential conflicts of interests; and

• (18) other matters prescribed by laws, regulations, the Articles of Association and the securities supervision and administration rules in the place where the Company’s shares are listed or designated by the regulatory authorities.

Independent non-executive directors shall express their opinions regarding the aforementioned in the following ways: by giving consent; by giving qualified opinions and reasons; by giving opinions and reasons to disagree; by expressing their inability to give opinions and their impediments.

IX – 12

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

If the relevant matters in the first paragraph of this Article are matters that need to be disclosed, the Company shall announce the opinions of the independent non-executive directors. When the independent non-executive directors have different opinions and cannot reach a consensus, the Board of Directors shall disclose the opinions of each independent non-executive director separately.

The opinions expressed by independent non-executive directors to the Board of Directors shall be stated in the minutes of board meetings.

• Article 31 When independent non-executive directors independently employ external audit institutions and consulting institutions, they shall submit in writing to the Board of Directors the information on the intermediary agencies to be engaged and work details, etc., and shall obtain the approval of the Board of Directors. The necessary reasonable expenses shall be borne by the Company.

• Article 32 The Company pays remuneration and allowances to the independent nonexecutive directors. The payment standard shall be drawn up by the Board of Directors or the remuneration committee and reviewed and approved by the shareholders’ meeting. In addition to the above remuneration and allowances, the independent non-executive directors shall not obtain additional, other undisclosed benefits from the Company, its controlling shareholder, de facto controller or other institutions and personnel connected to the Company.

• Article 33 The resignation or the expiry of the term of office of an independent nonexecutive director does not relieve him/her from liability to the Company and its shareholders before the resignation becomes effective and within a reasonable period of time after the resignation becomes effective. The duty to keep confidential to trade secrets of the Company survives the termination of his/her terms of office until such secrets are publicly disclosed. The continuous period of other duties shall be determined according to the principle of fairness, depending on the time lapse between the termination and the act concerned and the circumstances under which the relationship between him/her and the Company ends.

CHAPTER 5 SUPPLEMENTARY PROVISIONS

• Article 34 The term ‘‘no less than’’ as mentioned in the System includes the underlying number, while the terms ‘‘more than’’ and ‘‘lower than’’ do not include the underlying number.

IX – 13

APPENDIX IX

SYSTEM FOR THE INDEPENDENT NON-EXECUTIVE DIRECTORS

• Article 35 Matters not covered in the System shall be implemented in accordance with relevant laws, regulations, and other provisions of the regulatory authorities of the place where the Company’s shares are listed and relevant provisions of the Articles of Association. In case of the System being in conflict with the laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association, such laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association shall prevail.

• Article 36 The System shall be interpreted by the Board.

• Article 37 The System shall be subject to the consideration and approval of the shareholders’ meeting of the Company and shall take effect from the date on which the Company’s A shares issued under the initial public offering are listed on the Shanghai Stock Exchange.

IX – 14

APPENDIX X

MANAGEMENT SYSTEM FOR EXTERNAL GUARANTEES SYSTEM

• Article 1

• In order to strengthen the decision-making and audit work of the external guarantee of MicroTech Medical (Hangzhou) Co., Ltd (the ‘‘Company’’) and effectively prevent the Company’s external guarantee risks, the System is hereby formulated in accordance with the Company Law of the People’s Republic of China, the Securities Law of the People’s Republic of China, the Civil Code of the People’s Republic of China, the Guidelines for the Supervision of Listed Companies No. 8 – Supervision Requirements for Fund Transactions and External Guarantees of Listed Companies, and other relevant laws, administrative regulations, regulatory documents, and the relevant provisions of the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Articles of Association’’).

Article 2 Principles that the Company should follow on external guarantee decisionmaking:

• (1) It shall comply with the scope of external guarantee as stipulated by laws, regulations and the Articles of Association;

• (2) It shall be in line with the Company’s development strategy and overall business needs;

• (3) It shall be a scientific decision-making, democratic decision-making, no unit or individual may force the Company to provide guarantee for others, and the Company has the right to refuse to do so;

• (4) The external guarantee must bring significant benefits to the Company, or the failure to provide the guarantee will inevitably bring significant losses to the Company, and the benefits or losses brought are significantly greater than the loss arising from the risk of the relevant guarantee;

• (5) It must enter into a mutual guarantee agreement with the secured entity, and the mutual guarantee is of the same size or the secured entity is required to provide a reliable counter-guarantee of the same size, or an enforceable mortgage or pledge.

Article 3

Conditions of the Company’s external guarantee：

• (1) The Company’s external guarantee must be reviewed by the Board of Directors or the shareholders’ meeting;

X – 1

APPENDIX X

MANAGEMENT SYSTEM FOR EXTERNAL GUARANTEES SYSTEM

• (2) The external guarantee subject to the review and approval by the shareholders’ meeting shall be submitted to the shareholders’ meeting for approval after it is reviewed and approved by the Board of Directors;

• (3) The Company shall provide external guarantee based on reasonable commercial logic and shall require the other party to provide counterguarantee, and the provider of counter-guarantee shall have real capacity to undertake such counter-guarantee;

• (4) The Company must strictly comply with the relevant laws and regulations and the Articles of Association, earnestly fulfill the information disclosure obligation of external guarantee, and truthfully provide all the items related to the Company’s external guarantee to certified public accountants in accordance with the provisions;

• (5) The independent non-executive director of the Company shall, in the annual report, make special explanations on the situation of external guarantees that have not been completed as at the end of the reporting period and have commenced in the relevant period and the implementation of the above provisions, and express independent opinions.

• Article 4 The external guarantee of the Company and its controlling subsidiary shall be under the unified management by the Company. The controlling subsidiary shall not provide external guarantee or mutual guarantee without the approval of the Company.

• Article 5 The Board of Directors of the Company shall, before deciding to provide guarantee for others, or before submitting it to the shareholders’ meeting for the approval by voting, have a good understanding of the credit standing of the creditors and fully demonstrate the interests and risks of the guarantee.

Article 6 The information on the credit standing of the guarantee applicant shall cover the following:

• (1) Basic information of the applicant’s enterprise, including business license, copy of the Articles of Association, identity certificate of legal representative, relevant information reflecting the association relationship with the Company and other relations;

• (2) Written guarantee application, including but not limited to the method, duration and amount of the guarantee;

X – 2

APPENDIX X

MANAGEMENT SYSTEM FOR EXTERNAL GUARANTEES SYSTEM

• (3) The latest audited financial report and analysis of repayment capability;

• (4) Copy of the main contract relating to the borrowing;

• (5) Conditions and relevant information of counter-guarantee provided by the guarantee applicant;

• (6) A statement that there is no potential or ongoing significant legal proceeding, arbitration or administrative penalty;

• (7) Other important documents.

Article 7

The external guarantee subject to the review and approval by the shareholders’ meeting shall be submitted to the shareholders’ meeting for approval after they are reviewed and approved by the Board of Directors. External guarantees subject to the approval by the shareholders’ meeting include but not limited to the followings:

• (1) Any external guarantee, which is provided by the Company after the total amount of external guarantees of the Company and its controlling subsidiaries exceeds 50% of the Company’s latest audited net assets;

• (2) Any external guarantee, which is provided by the Company after the total amount of external guarantees of the Company accounts for more than 30% of the Company’s latest audited total assets;

• (3) The external guarantees, of which the guaranteed amount within one year accounts for more than 30% of the Company’s latest audited total assets;

• (4) The external guarantees, which are provided for the guaranteed party with the asset-liability ratio of more than 70%;

• (5) The guarantees, of which the single guarantee amount exceeds 10% of the Company’s latest audited net assets;

• (6) The guarantees, which are provided for the Company’s shareholders, de facto controllers and their related parties;

X – 3

MANAGEMENT SYSTEM FOR EXTERNAL GUARANTEES SYSTEM

APPENDIX X

The guarantee in Items (4) and (5) of the preceding paragraph shall be subject to the approval by more than two-thirds of the voting rights represented by the shareholders attending the shareholders’ meeting. When the Company provides a guarantee for a wholly-owned subsidiary, or provides a guarantee for a controlling subsidiary and other shareholders of the controlling subsidiary provide guarantees in the same proportion to their rights and interests, without prejudice to the interests of the Company, then the provisions which are applicable to Items (1) to (3) of the preceding paragraph may be waived. The Company shall summarize and disclose the aforementioned guarantees in its annual report and semi-annual report.

When the guarantee proposal for any shareholder, de facto controller and its related parties is reviewed at the shareholders’ meeting, the shareholders controlled by such shareholder or de facto controller and its related parties (and the relevant parties as provided by the securities regulatory rules of the place where the Company’s shares are listed), shall not vote on such proposal, and the guarantee proposal shall be subject to the approval by voting by more than half of the voting rights represented by the other shareholders present at the shareholders’ meeting.

• Article 8 The Company provides guarantee for a related party, the related directors shall abstain from voting at the board meeting to consider the guarantee matters. The board meeting may be held with the attendance of a majority of the nonrelated directors, and the resolutions made at the board meeting shall be approved by at least 2/3 of the non-related directors present at the board meeting. If the number of non-related directors attending the meetings is less than 3, the proposal shall not be voted on, but shall be submitted to the shareholders’ meeting for consideration.

• Article 9 Except for the external guarantee matters which shall be considered by the shareholders’ meeting as stipulated in the Articles of Association and the System, other external guarantee matters of the Company shall be considered and approved by the Board of Directors, and a resolution shall be made upon the consideration and approval by more than 2/3 of the directors present at the board meeting.

• Article 10 Where the Company provides guarantees for shareholders, de facto controllers and their related parties, such controlling shareholders, de facto controllers and their related parties shall offer counter-guarantee.

• Article 11 Decision-making procedure for external guarantee of the Company

X – 4

APPENDIX X

MANAGEMENT SYSTEM FOR EXTERNAL GUARANTEES SYSTEM

• (1) Before the board of directors considers the external guarantee matter (or before submitting it to the shareholders’ meeting for consideration), the Company shall report in writing to the Board of Directors or the shareholders’ meeting the credit status of the debtor, the benefits and risks of the guarantee matter;

• (2) When the shareholders’ meeting or the Board of Directors of the Company makes a resolution on a guarantee, the shareholders or directors having any interest in the guarantee shall abstain from voting;

• (3) The secretary of the Board of Directors shall keep detailed records of the discussions and voting at the board meetings and shareholders’ meetings.

• Article 12 The external guarantees approved by the Board of Directors or the shareholders’ meeting shall be promptly published on the website of the stock exchange and in the media that satisfies the requirements as prescribed by the China Securities Regulatory Commission. The contents of the disclosure include the relevant resolutions made by Board of Directors or the shareholders’ meeting, the total amount of external guarantees provided by the Company and its controlling subsidiaries as of the date of information disclosure, and the total amount of guarantees provided by the Company for its controlling subsidiaries.

Article 13 Management of the external guarantee contract of the Company

• (1) The Company shall enter into a written contract to provide external guarantee. The guarantee contract shall be properly kept in accordance with the internal management regulations of the Company, and reported to the Board of Supervisors, the secretary of the Board of Directors and the finance department in a timely manner;

• (2) the finance department shall designate the special personnel to set up and keep account of external guarantee, to record the information such as the unit, amount and maturity date of the guarantee to be provided, to timely update the situation of the external guarantees of the Company by checking the guarantees with the banks and relevant institutions on a regular or periodic basis, to ensure the integrity, accuracy and validity of the archived documents, and to pay attention to the duration of guarantees;

X – 5

APPENDIX X

MANAGEMENT SYSTEM FOR EXTERNAL GUARANTEES SYSTEM

• (3) for major guarantors, the other party shall provide financial statements regularly, and at least twice a year, the finance department or its designated personnel shall conduct on-site investigation on their business conditions;

• (4) the Company shall take effective measures to recover the debt from the debtor and the counter-guarantor after fulfilling the obligation of paying off the debt on behalf of the guarantor within the scope of the guarantee.

• Article 14 The term ‘‘external guarantee’’ as described in the System refers to the guarantee provided by the Company to others, including the guarantee provided by the Company to its controlling subsidiary. In the System, ‘‘the total amount of external guarantee of the Company and its controlling subsidiary’’ refers to the aggregate of the total amount of external guarantee of the Company (including the guarantee provided by the Company to its controlling subsidiary) and the total amount of external guarantee of the Company’s controlling subsidiary.

• Article 15 Matters not covered in the System shall be implemented in accordance with relevant laws, regulations, administrative regulations, regulatory documents and relevant provisions of the Articles of Association. In case of the System being in conflict with the laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association, such laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association shall prevail.

• Article 16 The System shall be interpreted by the Board.

• Article 17 The System shall be subject to the consideration and approval of the shareholders’ meeting of the Company and shall take effect from the date on which the Company’s A shares issued under the initial public offering are listed on the Shanghai Stock Exchange.

X – 6

MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT

APPENDIX XI

CHAPTER 1 GENERAL PROVISIONS

• Article 1 In order to regulate the external investment behavior of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’), improve the investment efficiency, guard against the risks brought by the investment, effectively and reasonably use the funds, maximize the time value of the funds, and safeguard the interests of the Company and its shareholders, this System is hereby formulated in accordance with the Company Law of the People’s Republic of China (the ‘‘Company Law’’), the Rules Governing the listing of Stocks on the Science and Technology Innovation Board of the Shanghai Stock Exchange, (the ‘‘Listing Rules’’) and other national laws, regulations and regulatory documents, and in combination with the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Articles of Association’’).

• Article 2 External investment herein refers to the Company’s activities of investing a certain amount of monetary capital, equity, physical assets, intangible assets or other assets that can be contributed according to laws and regulations and regulatory documents in order to obtain future income.

Article 3 The Company’s external investments can be classified into short-term and long-term investments according to the length of the investment period.

Short-term external investment refers to the investment purchased by the Company that can be realized at any time and held for no more than one year (inclusive), including various stocks, bonds, funds, etc.

Long-term investments refer to various investments that the Company cannot or does not intend to convert to cash and holds for more than one year, including bond investments, equity investments, etc. Long-term investments include, but are not limited to, the following:

• (1) Any enterprises independently established or business projects independently funded by the Company;

• (2) Any joint venture, cooperative company or development project funded and established by the Company together with other domestic and foreign independent legal entities and natural persons;

• (3) Buying shares of other domestic and foreign independent legal enterprises;

• (4) Operating assets are leased, entrusted or jointly operated with others.

XI – 1

APPENDIX XI

MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT

Article 4 The Company’s external investment shall follow the following principles:

• (1) Abide by the national relevant laws and regulations, and be in line of national industrial policies;

• (2) In line with the provisions of the corporate governance system such as the Articles of Association and the relevant provisions of the government regulatory authorities;

• (3) Comply with the requirements of the Company’s development strategy and planning, and be conducive to expanding the Company’s main business and sustainable development;

• (4) Adhere to the principle of giving priority to efficiency;

• (5) Pay attention to investment risks and ensure the safe operation of funds.

• Article 5 This System is applicable to all external investment activities of the Company and its wholly-owned subsidiaries and holding subsidiaries (the ‘‘Subsidiaries’’).

CHAPTER 2 APPROVAL AUTHORITY FOR EXTERNAL INVESTMENT

Article 6 Company’s external investment shall be subject to professional management and level-by-level examination and approval.

Article 7 The general manager, the Board of Directors and the general meeting of shareholders are the decision-making bodies of various investment activities. Each decision-making body shall make decisions and perform procedures for the investment activities of the Company in strict accordance with the authority stipulated in the Articles of Association and the internal management system of the Company.

The general manager of the Company, as the person in charge of the implementation of external investment, shall report the investment progress to the Board of Directors in a timely manner, so as to facilitate the Board of Directors and the general meeting of shareholders to make timely decisions on investment. The leader in charge of investment of the Company is the direct leader of the implementation of external investment, responsible for the intermediate review of investment projects, and timely report the progress of investment projects to the general manager.

XI – 2

APPENDIX XI

MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT

• Article 8

The Company shall set up a principal responsible person and a centralized management department for the implementation of foreign investment, which shall be responsible for the preliminary evaluation, investigation and demonstration of investment projects, the preparation of feasibility study reports or due diligence reports, and the provision of corresponding investment proposals for project review and investment decision-making. The Finance Department of the Company shall cooperate with the investment, development and management.

Article 9 Any external investment shall be submitted to the shareholders’ meeting for approval after being reviewed by the Board of Directors, provided one of the following standards is met:

• (1) The total assets involved in the transaction (if both the book value and the evaluation value exist at the same time, the higher value shall prevail) account for more than 50% of the Company’s latest audited total assets;

• (2) The transaction amount accounts for more than 50% of the Company’s market value;

• (3) The net assets of the subject matter of the transaction (such as equity) in the latest accounting year account for more than 50% of the Company’s market value;

• (4) The operating income of the transaction (such as equity) in the latest accounting year accounts for more than 50% of the audited operating income of the Company in the latest accounting year, and exceeds RMB50 million;

• (5) The profit generated by the transaction accounts for more than 50% of the audited net profit of the Company in the latest accounting year and exceeds RMB5 million;

• (6) The net profit of the subject matter of the transaction (such as equity) in the latest accounting year accounts for more than 50% of the audited net profit of the Company in the latest accounting year, and exceeds RMB5 million.

• (7) Other transactions stipulated by the stock exchange or the Company’s Articles of Association.

XI – 3

APPENDIX XI

MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT

If any value involved in the calculations above is negative, the absolute value shall apply.

For transactions that meet the standards prescribed in this article, if the subject matter of the transaction is the Company’s equity, the Company shall employ an accounting firm qualified for the execution of securities and futures business to audit the latest financial and accounting reports of the trading targets, and the audit deadline shall not exceed six months from the date of signing the agreement. If the subject matter of the transaction is assets other than equity, the Company shall employ an assets appraisal office qualified or the execution of securities and futures related business to execute the appraisal, and the base date of the appraisal shall not exceed one year from the date of signing the agreement.

Article 10 When the external investment of the Company meets one of the following standards, it shall be submitted to the Board of Directors for consideration:

• (1) The total assets involved in the transaction (if both book value and evaluation value exist at the same time, the larger value shall prevail) represent more than 10% of the Company’s latest audited total assets;

• (2) The trading amount of the transaction accounts for more than 10% of the Company’s market value;

• (3) The net assets of the transaction object (such as equity) in the latest fiscal year account for more than 10% of the Company’s market value;

• (4) The operating income of the transaction object (such as equity) in the latest fiscal year accounts for more than 10% of the Company’s audited operating income in the latest fiscal year, and exceeds RMB10 million;

• (5) The profit arising from the transaction accounts for more than 10% of the Company’s audited net profit in the latest fiscal year and exceeds RMB1 million;

• (6) The net profit arising from the transaction (such as equity) in the latest accounting year accounts for more than 10% of the Company’s audited net profit in the latest accounting year, and exceeds RMB1 million.

XI – 4

MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT

APPENDIX XI

The calculation standards of the above indicators shall be implemented in accordance with the relevant provisions of the Listing Rules. Where the scope of consolidated statements is changed due to equity transactions of the Company, the relevant financial indicators of the Company corresponding to the equity shall be taken as the basis for calculation, and Article 9 or 10 of the System shall apply.

If the aforesaid equity transaction does not result in any change in the scope of the consolidated statements, the relevant financial indicators shall be calculated according to the proportion of changes in the equity held by the Company, and Article 9 or 10 of this System shall apply.

• Article 11 The purchase and sale of assets by the Company shall be calculated on the basis of the total amount of assets and the transaction amount, whichever is higher, and shall be calculated accumulatively within 12 consecutive months according to the type of transaction. If the total amount reaches 30% of the latest audited total assets, it shall be submitted to the shareholders’ meeting for consideration and approved by more than two-thirds of the voting rights held by the shareholders present at the meeting.

• Article 12 The above-mentioned purchase or sale of assets does not include the purchase of raw materials, fuel and power, and the sale of products, commodities and other assets related to daily operations, but the purchase or sale of such assets involved in asset replacement is still included.

• Article 13 External investment that fails to meet the approval standards of the Board of Directors shall be reviewed and approved by the general manager’s office.

• Article 14 The securities investment of the Company shall be submitted to the shareholders’ meeting for consideration after being reviewed and approved by the Board of Directors, and shall be approved by more than 2/3 of all directors and more than 2/3 of independent non-executive directors.

• Article 15 Where the Company’s external investment involves related party transactions, it shall perform the approval procedures in accordance with the limits of authority stipulated in the securities regulatory laws, regulations and the Articles of Association.

XI – 5

MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT

APPENDIX XI

CHAPTER 3 DECISION-MAKING AND MANAGEMENT OF EXTERNAL INVESTMENT

• Article 16 The Company strictly controls the investment in securities, entrusted financing or derivatives such as futures, options and warrants based on stocks, interest rates, exchange rates and commodities with its own funds.

• Article 17 Where the Company conducts entrusted financial management, a qualified professional financial institution with good credit and financial status, no bad credit record and strong profitability shall be selected as the trustee, and a written contract shall be signed with the trustee to specify the amount, duration, investment varieties, rights and obligations of both parties and legal responsibilities of the entrusted financial management.

• The Board of Directors of the Company shall appoint a special person in charge to track the progress and safety of the entrusted financing funds, and shall require him to report in time in case of any abnormal situation, so that the Board of Directors can immediately take effective measures to recover the funds and avoid or reduce the Company’s losses.

• Article 18 The Board of Directors of the Company shall regularly understand the implementation progress and investment benefits of major investment projects. In case of failure to invest as planned, failure to realize the expected benefits of the project, and loss of investment, the Board of Directors of the Company shall find out the reasons and take effective measures in a timely manner to investigate the responsibilities of relevant personnel.

• Article 19 For a new company established by external investment, the Company shall, according to the actual situation, send directors and supervisors elected through legal procedures to the new company to participate in and supervise the operation and decision-making of the new company.

• Article 20 For a subsidiary established by external investment, the Company shall send corresponding management personnel to play an important role in the operation and decision-making of the company.

XI – 6

APPENDIX XI

MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT

• Article 21 The dispatched personnel shall earnestly perform their duties in accordance with the Company Law and the Articles of Association of the invested company, safeguard the Company’s interests in the operation and management activities of the new company, and realize the preservation and appreciation of the Company’s investment. The relevant personnel appointed by the Company as the directors and supervisors of the investment entity shall obtain more information about the invested entity by attending the meetings of the Board of Directors and the Board of Supervisors, and report the investment situation to the relevant departments of the Company in a timely manner. The dispatched personnel shall sign a letter of responsibility with the Company every year, accept the assessment indicators issued by the Company, submit an annual work report to the Company and accept the Company’s inspection.

CHAPTER 4 FINANCIAL MANAGEMENT AND AUDIT OF EXTERNAL INVESTMENT

• Article 22 The Company’s finance department shall make comprehensive and complete financial records of the Company’s external investment activities, conduct detailed accounting, establish detailed account books for each investment project, and record relevant information in detail. The accounting method of external investment shall comply with the provisions of accounting standards and accounting systems.

• Article 23 The Company’s finance department shall be responsible for the financial management of long-term external investment. The finance department shall obtain the financial report of the invested unit according to the needs of analysis and management, so as to analyze the financial status of the invested unit, safeguard the rights and interests of the Company and safeguard that the interests of the Company are not damaged.

• Article 24 The Company shall conduct a comprehensive inspection on the external investment at the end of each year; conduct regular or special audits of subsidiaries.

• Article 25 The accounting policies, accounting estimates and changes adopted in the accounting methods and financial management of the Company’s subsidiaries shall comply with the Company’s financial accounting system and its relevant provisions.

XI – 7

APPENDIX XI

MANAGEMENT SYSTEM FOR EXTERNAL INVESTMENT

• Article 26 Subsidiaries of the Company shall submit financial and accounting statements to the finance department of the Company on a monthly basis, and provide accounting information in a timely manner in accordance with the requirements for the preparation of consolidated statements and disclosure of accounting information by the Company.

• Article 27 The investment assets owned by the Company shall be regularly counted by the financial department, internal auditors or other personnel who are not involved in the investment to verify whether it is owned by the Company. The counting records and the book records shall be checked to confirm the consistency of the accounts.

CHAPTER 5 SUPPLEMENTARY PROVISIONS

• Article 28 Matters not covered in the System shall be implemented in accordance with relevant laws, regulations, and the Articles of Association.

• Article 29 In case of the System being in conflict with relevant laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association, such laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association shall prevail.

• Article 30 These System shall be interpreted by the Board.

• Article 31 The System shall be subject to the consideration and approval of the shareholders’ meeting of the Company and shall take effect from the date on which the Company’s A shares issued under the initial public offering are listed on the Shanghai Stock Exchange.

XI – 8

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

APPENDIX XII

CHAPTER 1 GENERAL PROVISIONS

Article 1 In order to further strengthen the management of related party transactions of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’), clarify the management responsibilities and division of labor, safeguard the legitimate interests of shareholders and creditors of the Company, especially the legitimate interests of minority investors, and ensure the compliance of the transactions between the Company and related parties with the principle of fairness, openness and impartiality, this System is hereby formulated in accordance with the Company Law of the People’s Republic of China, the Rules Governing the Listing of stocks on the Science and Technology Innovation Board of the Shanghai Stock Exchange and the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. and other laws and regulations.

Connected transactions as defined under the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited shall be governed by the relevant provisions of the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited and the Related Party Transaction Management System of Shanghai MicroTech Medical (Hangzhou) Co., Ltd..

• Article 2 This System shall apply to the related transactions between the Company and its wholly-owned and holding subsidiaries and other subsidiaries within the scope of consolidated statements (the ‘‘Subsidiaries’’) and the related parties of the Company.

CHAPTER 2 RELATED PARTIES AND RELATED RELATIONSHIP

Article 3 The related parties of the Company include related legal persons and related natural persons.

• Article 4 The legal person (or other organization) under any of the following circumstances is an related legal person (or other organization) of the Company:

• (1) The legal persons (or other organizations) that have a direct or indirect control over the Company;

• (2) Legal persons (or other organizations) directly or indirectly controlled by the legal persons (or other organizations) mentioned in the preceding paragraph, other than companies, holding subsidiaries and other subjects controlled by them;

XII – 1

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• (3) Legal persons (or other organizations) directly or indirectly controlled by related natural persons, or serving as directors (excluding independent directors of both parties) or senior managers, other than companies, holding subsidiaries and other subjects controlled by them;

• (4) Any legal person (or other organizations) holding more than 5% of the Company’s shares and their persons acting in concert.

Article 5 The natural person under any of the following circumstances shall be a related natural person of the Company:

• (1) The natural persons who directly or indirectly hold more than 5% of the Company’s shares;

• (2) Directors, supervisors and senior managers of the Company;

• (3) Directors, supervisors and senior managers of legal persons (or other organizations) who directly or indirectly control the Company;

• (4) Family members who are closely tied with the related natural persons described in Items (1) and (2) of this article, including spouses, parents and parents of spouses, brothers and sisters and their spouses, children over 18 years of age and their spouses, brothers and sisters of spouses and parents of children’s spouses.

The China Securities Regulatory Commission, the Shanghai Stock Exchange or the Company may, in accordance with the principle of substance over form, identify other legal persons (or other organizations) or natural persons who have a special relationship with the Company and may or have caused the Company to tilt its interests as related persons of the Company.

Article 6 The legal person or natural person under any of the following circumstances shall be deemed as a related party of the Company:

• (1) According to the agreement or arrangement signed with the Company or its related parties, after the agreement or arrangement comes into effect, or within the next 12 months, there is one of the circumstances specified in Article 4 or Article 5 of this System;

• (2) In the past 12 months, one of the circumstances specified in Article 4 or Article 5 of this System has occurred.

XII – 2

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• Article 7 Related relationship mainly refers to the ways or means that have the ability to directly or indirectly control or exert significant influence on the Company in financial and operational decision-making, including but not limited to the equity relationship, personnel relationship, management relationship and commercial interest relationship between the related party and the Company.

• Article 8 The Company shall timely fill in and update the list of related parties and related relationship information of the Company through the business management system of Shanghai Stock Exchange.

The directors, supervisors, senior managers, shareholders holding more than 5% of the Company’s shares and their concerted actors and de facto controllers shall timely submit to the Board of Directors of the Company the list of related parties and the description of the related relationship, and the Company shall do a good job in registration management.

• Article 9 The Company shall make substantive judgments on the ways, means, extent and possible results of the control and influence of the related relationship on the Company, and make choices that do not harm the interests of the Company.

CHAPTER 3 RELATED PARTY TRANSACTION

Article 10 Company’s related transaction refers to the transfer of resources or obligations between the Company, its holding subsidiaries and other subjects under its control and the Company’s related party, including:

• (1) Purchase or sale of assets;

• (2) External investment (including entrusted financing, investment in subsidiaries, etc.);

• (3) Providing financial assistance (including interest-bearing or interest-free loans, entrusted loans, etc.);

• (4) Providing guarantees (including guarantees for holding subsidiaries);

• (5) Leasing-in or leasing-out of assets;

• (6) Entrusting or trusteeing the management of assets and businesses;

• (7) Donating assets or receiving donated assets;

XII – 3

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• (8) Restructuring of claims and debts;

• (9) Entering into a license agreement;

• (10) Transferring or accepting R&D projects;

• (11) Waiver of rights (including waiver of right of first refusal and preemptive subscription rights);

• (12) Purchasing raw materials, fuel and power;

• (13) Selling products and commodities;

• (14) Providing or accepting labor services;

• (15) Entrusting or entrusted sales;

• (16) Deposit and loan business;

• (17) Joint investment with related parties;

• (18) Other matters that may lead to the transfer of resources or obligations agreed upon.

Article 11

The related transactions of the Company shall follow the following basic principles:

• (1) Conform to the principle of good faith;

• (2) The principle of not damaging the legitimate rights and interests of the Company and non-related shareholders;

• (3) If a related party enjoys the right to vote at the shareholders’ meeting of the Company, it shall withdraw from voting except under special circumstances;

• (4) The principle of avoidance of related parties. Any interested director shall withdraw from voting on the matter at the meeting of the Board of Directors. The related shareholders shall withdraw from voting at the shareholders’ meeting at which other related transactions are being considered;

XII – 4

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• (5) The Board of Directors of the Company shall judge whether the related party transaction is beneficial to the Company according to objective standards. If necessary, professional appraisers or independent financial consultants should be employed.

Article 12 When signing an agreement involving related party transactions with the Company, the related party of the Company shall take necessary avoidance measures:

• (1) Any individual can only sign the agreement on behalf of one party;

• (2) The related party shall not interfere with the decision of the Company in any way;

• (3) When the Board of Directors of the Company votes on the related party transactions, the interested parties shall apply for withdrawal by themselves under the following circumstances, and the Board of Directors shall also have the right to request the related directors and other parties to withdraw, but the following related directors shall have the right to participate in the consideration and discussion of the related matters and put forward their own opinions:

• Related transactions related to the personal interests of directors;

• Related transactions between an related enterprise and the Company where an individual director holds a post in the related enterprise or owns the controlling right or control right of the related enterprise;

• Withdrawal in accordance with laws, regulations and the Company’s Articles of Association.

• (4) When the shareholders’ meeting of the Company votes on related party transactions, the related shareholders shall not participate in the voting; In case of any special circumstance that cannot be avoided, the related shareholders may participate in the voting after the Company has obtained the consent of the competent department. The Company shall make a detailed explanation in the resolution of the shareholders’ meeting, and make special statistics on the voting of shareholders of non-related parties, and disclose them in the announcement of the resolution.

XII – 5

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• Article 13 The Company shall take effective measures to prevent the related parties from interfering with the operation of the Company and damaging the interests of the Company and non-related shareholders by monopolizing the procurement and sales business channels. The prices or charging principles of related party transactions shall not deviate from the prices or charging standards of independent third parties in the market. The Company shall fully disclose the pricing basis for related party transactions.

• Article 14 A written contract or agreement shall be signed for the related transactions between the Company and the related parties, and the principles of equality, voluntariness, equivalence and compensation shall be followed. The contents of the contract or agreement shall be clear and specific.

• Article 15 The Company shall take effective measures to prevent the shareholders and their related parties from occupying or transferring the funds, assets and other resources of the Company in various forms. Including but not limited to:

• (1) The Company and its holding subsidiaries advance wages, welfare, insurance, advertising and other expenses for related parties, or bear costs and expenses on behalf of each other.

• (2) To lend the funds of the entity to the controlling shareholder or other related parties for use with or without compensation;

• (3) Providing entrusted loans to related parties through banks or non-bank financial institutions;

• (4) Entrusting related parties to carry out investment activities;

• (5) Issuing commercial acceptance bills without real transaction background for related parties;

• (6) Repaying debts on behalf of related parties;

• (7) Other ways recognized by laws and regulations.

CHAPTER 4 DISCLOSURE OF RELATED PARTY TRANSACTIONS AND DECISION-MAKING PROCEDURES

Article 16 Where the transactions between the Company and the related parties meet one of the following standards, they shall be disclosed in a timely manner:

XII – 6

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• (1) Transactions with related natural persons with a transaction amount (including debts and expenses) of more than RMB300,000;

• (2) Transactions with related legal persons (or other organizations) in which the transaction amount (including debts and expenses assumed) is more than RMB3 million and accounts for more than 0.1% of the total assets or market capitalization of the Company.

• Article 17 When the Board of Directors of the Company reviews the related party transactions, the related directors shall withdraw from voting and shall not exercise the voting rights on behalf of other directors. The meeting of the Board of Directors may be held if more than half of the non-related directors are present, and the resolutions made at the meeting of the Board of Directors shall be passed by more than half of the non-related directors. If the number of non-related directors present at the meeting of the Board of Directors is less than three, the Company shall submit the transaction to the shareholders’ meeting for consideration.

Article 18 Related directors include the following directors or directors under any of the following circumstances:

• (1) The counterparty;

• (2) The direct or indirect controller of the counterparty;

• (3) Holding a position in the counterparty, or in any legal person or other organization that can directly or indirectly control the counterparty, or any legal person or other organization that can be directly or indirectly controlled by the counterparty;

• (4) Close family member of the counterparty or its direct or indirect controller;

• (5) Close family members of the counterparty or its direct or indirect controller or its directors, supervisors and senior management;

• (6) Directors whose independent business judgment may be affected as determined by the China Securities Regulatory Commission, the Shanghai Stock Exchange or the Company based on the principle of substance over form.

XII – 7

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

Article 19

When the shareholders’ meeting of the Company reviews on related party transactions, the related shareholders shall withdraw from voting and shall not exercise their voting rights on behalf of other shareholders. The measures are as follows:

• (1) The related shareholders shall apply for withdrawal on their own initiative, otherwise other shareholders and supervisors attending the meeting shall have the right to apply for withdrawal of related shareholders to the shareholders’ meeting;

• (2) When there is a dispute over whether it is a related shareholder, the shareholders’ meeting shall temporarily review and vote as a procedural issue to decide whether it should withdraw;

• (3) When the shareholders’ meeting votes on related party transactions, the number of shares with voting rights represented by the related shareholders shall not be counted, and the non-related shareholders present at the shareholders’ meeting shall vote in accordance with the provisions of the Articles of Association and the rules of the shareholders’ meeting;

Article 20 Related shareholders include the following shareholders or any of the following circumstances:

• (1) The counterparty;

• (2) The direct or indirect controller of the counterparty;

• (3) Being directly or indirectly controlled by the counterparty;

• (4) The shareholder and the counterparty directly or indirectly controlled by the same natural person, legal person or other organization;

• (5) Holding a position in the counterparty, or holding a position in a legal person or other organization that can directly or indirectly control the counterparty, or in a legal person or other organization that is directly or indirectly controlled by the counterparty;

• (6) Closely family member of the counterparty or its direct or indirect controller;

XII – 8

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• (7) Shareholders whose voting rights are restricted and affected due to any unfinished equity transfer agreements or other agreements with the counterparty or its related parties;

• (8) Shareholders identified by the China Securities Regulatory Commission or the Shanghai Stock Exchange that may cause the Company’s interests to tilt towards them.

Article 21 When the shareholders’ meeting reviews the related party transactions, the related shareholders shall not participate in the voting, and the number of voting shares represented by them shall not be included in the total number of voting shares.

If the related shareholders expressly withdraw, other shareholders present at the shareholders’ meeting shall review and vote on the related party transactions, and the voting results shall have the same legal effect as other resolutions passed at the shareholders’ meeting.

Article 22 Decision-making authority of related party transactions:

• (I) Approval authority of the general manager

• The Company intends to have a related transaction with a related natural person with a transaction amount of less than RMB300,000;

• The transaction amount between the Company and the related legal person (including the accumulated amount of related transactions of the same subject matter or the same related legal person in 12 consecutive months) is less than RMB3 million, or the related transaction accounts for less than 0.1% of the total assets or market capitalization of the Company.

• (II) Approval authority of the Board of Directors

• The Company intends to have a related transaction with a related natural person with a transaction amount of more than RMB300,000;

• The transaction amount between the Company and the related legal person accounts for more than 0.1% of the Company’s latest audited total assets or market value, and exceeds RMB3 million.

XII – 9

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

(III) Approval authority of the shareholders’ meeting

1. The transaction amount between the Company and the related party (excluding the provision of guarantee, including the accumulated amount of related party transactions of the same subject matter or the same related party within 12 consecutive months) accounts for more than 1% of the Company’s latest audited total assets or market value, and exceeds RMB30 million;

2. Where the Company provides guarantee for related parties, it shall have reasonable business logic, regardless of the amount, and submit it to the shareholders’ meeting for consideration; Where the Company provides guarantee for the controlling shareholders, de facto controllers and their related parties, the controlling shareholders, de facto controllers and their related parties shall provide counter-guarantee.

3. Article 23 The Company shall prudently provide financial assistance or entrust financial management to related parties; If it is really necessary, the amount incurred shall be taken as the calculation standard for disclosure and shall be calculated accumulatively within 12 consecutive months.

Those who have fulfilled the relevant obligations in accordance with the provisions of this chapter shall no longer be included in the relevant cumulative calculation scope.

• Article 24 The Company shall disclose or approve the following transactions in accordance with the principle of accumulative calculation within 12 consecutive months:

• (1) Transactions with the same related party;

• (2) Transactions related to the subject matter of the transaction with different related parties.

The same related party mentioned above includes a legal person or other organization that is controlled by the same de facto controller, or has an equity control relationship with the related person, or has the same natural person as a director or senior manager.

XII – 10

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

Those who have fulfilled the relevant obligations in accordance with the provisions of this chapter shall no longer be included in the scope of cumulative calculation.

Article 25 The following transactions between the Company and related parties may be exempted from consideration and disclosure in the form of related party transactions:

• (1) One party subscribes the stocks, corporate bonds or enterprise bonds, convertible corporate bonds or other derivatives publicly issued by the other party in cash;

• (2) One party, as a member of the underwriting group, underwrites the stocks, corporate bonds or enterprise bonds, convertible corporate bonds or other derivatives publicly issued by the other party;

• (3) One party receives dividends, bonuses or remuneration in accordance with the resolution of the shareholders’ meeting of the other party;

• (4) One party participates in the public bidding or auction of the other party, except that the bidding or auction is difficult to form a fair price;

• (5) Transactions in which the Company obtains benefits unilaterally, including receiving donated cash assets, obtaining debt relief, accepting guarantees and subsidies, etc.;

• (6) The pricing of related transactions is stipulated by the nation;

• (7) The interest rate of funds provided by related parties to the Company is not higher than the benchmark loan interest rate for the same period stipulated by the People’s Bank of China, and the Company has no corresponding guarantee for such financial assistance;

• (8) The Company provides products and services to directors, supervisors and senior managers under the same trading conditions as non-related parties;

• (9) Other transactions recognized by the Shanghai Stock Exchange.

Article 26 The subject matter of transactions involved in related transactions related to daily operations may not be audited or evaluated.

XII – 11

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• Article 27

• If the Company intends to conduct a related party transaction that shall be submitted to the shareholders’s meeting for consideration, it shall obtain the prior approval of the independent directors before submitting it to the Board of Directors for consideration.

The prior approval opinions of independent directors shall be approved by more than half of all independent directors and disclosed in the announcement of related party transactions.

• Article 28 The Board of Supervisors shall clearly express opinions on whether the related party transactions that need to be approved by the Board of Directors or the shareholders’ meeting are fair and reasonable, and whether there are circumstances that damage the legitimate rights and interests of the Company and non-related shareholders.

• Article 29 The Board of Directors shall review at least the following documents when making resolutions on related party transactions:

• (1) Description of the background of the related party transaction;

• (2) Subject qualification certificate of the related party (business license of legal person or identity certificate of natural person);

• (3) Agreements, contracts or any other written arrangements related to related party transactions;

• (4) Documents and materials based on the pricing of related party transactions;

• (5) Description of the impact of related transactions on the legitimate rights and interests of the Company and non-related shareholders;

• (6) Intermediary agency report (if any);

• (7) Other materials required by the Board of Directors.

Article 30

In addition to the documents listed in the preceding paragraph, the following documents shall also be examined when the shareholders’s meeting makes a resolution on related transactions:

• (1) The Board of Supervisors of the Company shall make resolutions on such transactions.

XII – 12

APPENDIX XII

THE MANAGEMENT SYSTEM FOR A SHARE RELATED TRANSACTIONS

• (2) The opinions of the independent directors of the Company on such transactions.

The shareholders’ meeting, the Board of Directors and the general manager shall, in accordance with the provisions of the Articles of Association and the rules of procedure, review and vote on the related party transactions of the Company within their respective limits of authority, and comply with the provisions of the relevant withdrawal system.

CHAPTER 5 SUPPLEMENTARY PROVISIONS

Article 31 Matters not covered in the System shall be implemented in accordance with relevant laws, regulations, and the Articles of Association.

• Article 32 In case of the System being in conflict with relevant laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association, such laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association shall prevail.

• Article 33 These System shall be interpreted by the Board.

• Article 34 The System shall be subject to the consideration and approval of the shareholders’ meeting of the Company and shall take effect from the date on which the Company’s A shares issued under the initial public offering are listed on the Shanghai Stock Exchange.

XII – 13

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

APPENDIX XIII

CHAPTER 1 GENERAL PROVISIONS

Article 1

• In order to regulate the management and use of the raised funds of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’), improve the use efficiency of the raised funds and protect the rights and interests of investors, in accordance with the Company Law of the People’s Republic of China, the Securities Law of the People’s Republic of China, the Administrative Measures for the Registration of Initial Public Offerings of Stocks by the Science and Technology Innovation Board (for Trial Implementation), the Administrative Measures for the Registration of Securities Issuance of Listed Companies by the Science and Technology Innovation Board (for Trial Implementation), the Rules Governing the Listing of Stocks on the Science and Technology Innovation Board of Shanghai Stock Exchange (the ‘‘SSE Sci-Tech Board Listing Rules’’), the Guidelines for the Regulation of Listed Companies No. 2 – Regulatory Requirements for the Management and Use of Raised Funds by Listed Companies, the Guidelines of Shanghai Stock Exchange for the Application of Self-Regulation Rules for the Listed Companies on the SSE Sci-Tech Board No. 1 – Regulated Operation of Listed Companies and other laws, regulations and the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Articles of Association’’), this System is formulated in accordance with the actual situation of the Company.

• The funds raised by the Company in the H-share market shall be managed in accordance with the relevant provisions of the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited.

• Article 2 The term ‘‘raised funds’’ stated in this System refers to the funds raised by the Company by issuing securities to non-specially-designated investors (including the initial public offering of stocks, allotment, additional issuance, the issuance of convertible corporate bonds, and the issuance of convertible corporate bonds under separate transactions, corporate bonds, warrants, etc.) and by issuing securities to specially-designated investors to specific objects, but excluding the funds raised by the Company through equity incentive plans.

• This System is also applicable to the use and management of the excess funds (the ‘‘Excess Fund’’) if the actual amount of raised funds exceeds the planned amount.

• Article 3 The Board of Directors of the Company is responsible for establishing and improving the management System of the Company’s raised funds and ensuring the effective implementation of this System.

XIII – 1

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

The Company shall timely report the internal control system for the deposit, use and management of the raised funds to the Shanghai Stock Exchange for filing and disclose it on the website of the Shanghai Stock Exchange. According to the arrangement of Shanghai Stock Exchange, the Company continuously discloses the use of raised funds and the arrangement of the key investment of raised funds in the field of scientific and technological innovation.

The Board of Directors of the Company shall fully demonstrate the feasibility of the raised funds-related investment project (the ‘‘Fundraising Investment Project’’), make sure that the investment project has good market prospects and profitability, effectively prevent investment risks and improve the efficiency of the use of raised funds.

• Article 4 Fundraising investment project is implemented through a subsidiary of the Company or other enterprises controlled by the Company, the Company shall ensure that the subsidiary or other enterprises controlled by the Company comply with this System.

The controlling shareholders and de facto controllers of the Company shall not directly or indirectly occupy or misappropriate the raised funds of the Company, nor shall not use the funds raised and fundraising investment project by the Company to harvest illegitimate benefits.

• Article 5 The directors, supervisors, and senior management of the Company shall exercise due diligence, urge the Company to use the raised funds in compliance with the regulatory requirements, consciously maintain the safety of the funds raised by the Company, and shall not participate in, assist or connive at the Company’s unauthorized or disguised change in the use of the raised funds.

• Article 6 The raised funds are limited to be used for the investment of the raised funds disclosed by the Company and the projects of the raised funds decided or approved by the shareholders’ meeting and the Board of Directors. The Board of Directors of the Company shall formulate a detailed plan for the use of funds, so as to ensure that the use of funds is standardized, open and transparent.

• Article 7 After the raised funds are in place, the Company shall organize the use of raised funds according to the fund use plan made in the prospectus, fundraising instructions and other information disclosure documents.

XIII – 2

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

• Article 8 The Board of Directors of the Company shall disclose the use of the raised funds in a timely manner in accordance with the SSE Sci-Tech Board Listing Rules and relevant laws, administrative regulations and other regulatory documents.

• Article 9 The Company shall use the raised funds in accordance with the plan and progress promised in the prospectus, fundraising instructions and other information disclosure documents. Without the resolution or authorization made by the shareholders’ meeting of the Company in accordance with the law and the approval of the relevant securities regulatory authorities (if necessary), the use of raised funds announced by the Company shall not be changed. The directors, supervisors and senior managers of the Company shall earnestly perform their duties, strengthen the supervision of the raised funds and ensure the authenticity of information disclosure.

• Article 10 The Company shall support and cooperate with the sponsor or independent financial advisor to perform the duties of sponsorship and/or continuous supervision on the management and use of the Company’s raised funds in accordance with the Administrative Measures for the Sponsorship of Securities Issuance and Listing and this System.

• Article 11 The use of the raised funds of the Company shall meet the following requirements:

• (1) The amount of raised funds and investment projects are compatible with the Company’s existing production and operation scale, financial situation, technical level and management ability;

• (2) The use of raised funds conforms to the provisions of national industrial policies and relevant laws and administrative regulations on environmental protection and land management;

• (3) Establish a special deposit system for raised funds, and the raised funds must be deposited in a special account decided by the Board of Directors of the Company (the ‘‘Special Account for Raised Funds’’ or the ‘‘Special Account’’).

XIII – 3

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

Article 12 If the use of raised funds involves information disclosure, it shall be implemented in accordance with the relevant provisions of the stock exchange where it is listed and the Information Disclosure Management System of MicroTech Medical (Hangzhou) Co., Ltd.. The Company shall establish and improve the system of deposit, use, change, decision-making, supervision and accountability of raised funds, disclose the specific arrangements for the key investment of raised funds in the field of scientific and technological innovation, and continuously disclose the use of raised funds.

CHAPTER 2 DEPOSITORY OF RAISED FUNDS

Article 13 The deposit of the raised funds of the Company shall adhere to the principles of centralized deposit, standardized use, truthful disclosure and strict management.

The raised funds of the Company shall be deposited in the special account for raised funds established with the approval of the Board of Directors for centralized management. The special account for raised funds shall not deposit non-raised funds or use them for other purposes. If the Company considers that it is necessary to open a special account in more than one bank in combination with the credit arrangement of the investment project due to the large amount of raised funds, it may open a special account in more than one bank with the approval of the Board of Directors under the principle of centralized deposit and easy supervision.

After the raised funds are in place, the Company shall go through the capital verification procedures in a timely manner, which shall be verified by an accounting firm in compliance with the provisions of the Securities Law of the People’s Republic of China and issue a capital verification report.

Article 14 The Company shall, within one month after the receipt of the raised funds, sign a tripartite supervision agreement on the special account of raised funds with the sponsor or independent financial advisor, and the commercial bank depositing the raised funds (the ‘‘Commercial Bank’’). The agreement shall at least include the following:

• (1) The Company shall deposit the raised funds into the special account for raised funds in a centralized manner;

• (2) The account number of the special account for the raised funds, the items of the raised funds involved in the special account, and the deposit amount;

XIII – 4

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

• (3) The commercial bank shall provide the Company with the bank statements of the special account for raised funds on a monthly basis, and send a copy to the sponsor or the independent financial advisor;

• (4) If the Company withdraws more than RMB50 million from the special account for raised funds in a single time or within 12 months and reaches 20% of the net amount of the total raised funds after deducting the issuance expenses (hereinafter referred to as the ‘‘Net Raised Funds’’), the Company shall notify the sponsor or the independent financial advisor in a timely manner;

• (5) The sponsor or independent financial advisor may at any time inquire about the information on the special account for raised funds at the commercial bank;

• (6) The supervision duties of the sponsor or independent financial advisor, the notification and cooperation duties of the commercial bank, and the supervision methods of the sponsor or independent financial advisor and the commercial bank on the use of the Company’s raised funds;

• (7) The liabilities for breach of contract of the Company, the commercial bank, and the sponsor or independent financial advisor shall be specified.

• (8) If a commercial bank fails to issue a statement of account to the sponsor or independent financial advisor in a timely manner for three times, or fails to cooperate with the sponsor or independent financial advisor in inquiring and investigating the information of the special account, the Company may terminate the agreement and cancel the special account for raised funds.

The Company shall actively urge the commercial bank to perform the agreement. If the commercial bank fails to timely notify the special account of large withdrawals for three consecutive times, or fails to cooperate with the recommendation agency or the independent financial advisor to inquire and investigate the information of the special account, the Company may terminate the agreement and cancel the special account for raised funds.

XIII – 5

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

The Company shall report to the Shanghai Stock Exchange for filing and announcement within 2 trading days after the signing of the above agreement. If the above agreement is terminated in advance due to the change of sponsor or independent financial advisor or commercial bank before the expiration of the validity period, the Company shall enter into a new agreement with the relevant parties within two weeks from the date of termination of the agreement, and report to the Shanghai Stock Exchange for filing and announcement within 2 trading days after the signing of the new agreement.

CHAPTER 3 USE OF RAISED FUNDS

Article 15 The use of raised funds must strictly comply with the relevant approval and decision-making procedures in accordance with this System and the relevant provisions of the Company, and fulfill the obligation of information disclosure in accordance with the relevant provisions. The following requirements shall be followed:

• (1) The Company shall make clear provisions on the application, hierarchical examination and approval authority, decision-making procedures, risk control measures and information disclosure procedures for the use of raised funds;

• (2) The Company shall use the raised funds in accordance with the plan for the use of raised funds promised in the issuance application documents;

• (3) The Company shall report to the Shanghai Stock Exchange in a timely manner and make an announcement in case of circumstances that seriously affect the normal use of the raised funds;

• (4) In case of any of the following circumstances, the Company shall redemonstrate the feasibility and estimated income of the fundraising investment project, decide whether to continue to implement the project, and disclose the progress of the project, the reasons for the abnormality and the adjusted fundraising investment project (if any) in the latest periodic report:

• Significant changes have taken place in the market environment involved in the fundraising investment project;

• The fundraising investment project has been shelved for more than one year;

XIII – 6

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

1. Exceeding the completion period of the investment plan of the raised funds and the investment amount of the raised funds does not reach 50% of the relevant planned amount;

2. Other abnormal situations in the fundraising investment project.

Article 16

In principle, the funds raised by the Company should be used for the main business and invested in the field of scientific and technological innovation. The raised funds of the Company shall not be used in any of the following ways:

• (1) Fundraising investment project are financial investments such as holding trading financial assets and financial assets available for sale, lending to others and entrusting financial management, which are directly or indirectly invested in companies whose main business is to buy and sell securities;

• (2) Changing the use of raised funds in disguised form through pledge, entrusted loan or other means;

• (3) Provide the raised funds directly or indirectly to the controlling shareholders, de facto controllers and other related parties for their use, so as to facilitate the related parties to obtain unfair benefits by using the fundraising investment project;

• (4) Other acts in violation of the provisions on the management of raised funds.

Article 17 If the Company invests the self-raised funds in the fundraising investment project in advance, the Company can replace the self-raised funds with the raised funds within six months after the receipt of the raised funds. The replacement shall be considered and approved by the Board of Directors of the Company, the accounting firm shall issue an authentication report, and the independent directors, the Board of Supervisors, the sponsor or the independent financial advisor shall express their explicit consent. The Company shall report to the Shanghai Stock Exchange and make an announcement within 2 trading days after the meeting of the Board of Directors.

XIII – 7

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

Article 18

Listed Company may conduct cash management on the temporarily idle raised funds, and the term of its investment products shall not be longer than the term authorized by the internal resolution and shall not exceed 12 months, and the products it invests in shall meet the following conditions:

• (1) High security, meeting the requirements of capital preservation, and the issuer of the product can provide the commitment of capital preservation;

• (2) Good liquidity shall not affect the normal operation of the investment plan of the raised funds.

The investment products shall not be pledged, and the product-specific settlement account (if applicable) shall not deposit non-raised funds or be used for other purposes. If the product-specific settlement account is opened or cancelled, the Company shall report to the Shanghai Stock Exchange for filing and announcement within 2 trading days.

Article 19

The use of idle raised funds for cash management shall be considered and approved by the Board of Directors of the Company, and the independent directors, the Board of Supervisors, the sponsor or the independent financial advisor shall express their explicit consent. The Company shall announce the following contents within 2 trading days after the meeting of the Board of Directors:

• (1) Basic information on the funds raised this time, including the date of raising, the amount of raised funds, the net amount of raised funds and investment plan;

• (2) The use situation of raised funds;

• (3) The quota and duration of the investment products using the idle raised funds, whether there is any behavior of changing the use of the raised funds in a disguised form, and the measures taken to ensure the normal operation of the raised funds-related project;

• (4) The income distribution method, investment scope and safety of investment products;

• (5) Opinions issued by the independent non-executive directors, the Supervisory Committee, the sponsor or the independent financial advisor of the Company.

XIII – 8

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

After the funds due for the aforementioned investment products are returned to the special account for raised funds on schedule and announced, the Company can carry out cash management again within the authorized time limit and quota.

Article 20 The Company temporarily uses the idle raised funds to supplement working capital, provided that the use shall comply with the following requirements:

• (1) The use of raised funds shall not be changed in a disguised way, and shall not affect the normal implementation of the raised fund investment plan;

• (2) It shall be only used for the main business-related production and operation activities, and shall not be used for the allotment or subscription of new shares through direct or indirect arrangements, or for the transaction of shares and their derivatives, convertible corporate bonds and others;

• (3) A single supplementation of working capital shall not last for more than 12 months;

• (4) The raised funds previously used for temporarily supplementing working capital have been returned when falling due (if applicable).

The Company can temporarily use the idle raised funds to supplement working capital, provided that the use shall be subject to the examination and approval by the Board of Directors, and the independent non-executive directors, the sponsor and the Supervisory Committee shall give an explicit consent. The Company shall also submit a report to Shanghai Stock Exchange and make an announcement within 2 trading days after the Board meeting.

Prior to the due date of the supplementary working capital, the Company shall return the part of the funds to the special account for raised funds, and shall submit a report to Shanghai Stock Exchange and make an announcement within 2 trading days after all the funds are returned.

XIII – 9

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

Article 21

Where the Company uses the raised funds to acquire the assets or equity of an individual, legal person or other organization with de facto control over the Company and its related party, it shall comply with the following provisions:

• (1) In principle, the acquisition shall be able to effectively avoid horizontal competition, or reduce continuing related transactions after the acquisition, or be conducive to the Company’s expansion of new business, but it must be conducive to the Company’s long-term development and effectively protect the interests of minority investors;

• (2) The Company shall disclose the reasons for the transaction with the controlling shareholder or de facto controller, the pricing policy and pricing basis of the related party transaction, the impact of the related party transaction on the Company and the measures to solve the relevant problems;

• (3) The Company shall handle the matter in accordance with the provisions on decision-making and disclosure of related party transactions.

• Article 22 The Company’s use of the excess funds shall be reviewed and approved by the Board of Directors, and the independent directors, the Board of Supervisors, the sponsor or the independent financial advisor of the Company shall give special opinions, and then perform the obligation of information disclosure in accordance with the requirements of the SSE Sci-Tech Board Listing Rules and this System.

• Article 23 The Company shall use the excess fund according to the actual production and operation needs of the Company, which may be used for the fund gap of the fundraising investment projects, projects under construction and new projects (including acquisition of assets, etc.) or repayment of bank loans, or may be used for temporary or permanent supplement working capital.

• Article 24 Where the Company uses the excess fund to supplement the fund gap of the raised investment project, it shall disclose the implementation progress of the fundraising investment project, the reasons for the fund gap, the fund supplement plan and the special verification opinions of the sponsor or independent financial advisor.

XIII – 10

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

Article 25

Where the Company uses the excess fund for projects under construction and new projects (including acquisition of assets, etc.), it shall invest in the main business, conduct feasibility analysis of the investment projects in a scientific and prudent manner, and submit them to the Board of Directors for review and approval, and have independent directors, the Supervisory Committee, the sponsor agency or the independent financial advisor give an explicit statement of consent, and fulfill the obligation of information disclosure in a timely manner.

If the Company plans to use the excess funds in a single transaction amounting to RMB50 million and reaching more than 10% of the total excess fund, it shall also be submitted to the shareholders’ meeting for review and approval.

Article 26 The exceed fund may be used for permanent supplement working capital or repayment of bank loans, and the accumulative amount used within each 12 months shall not exceed 30% of the total amount of exceed fund, and shall undertake not to make high-risk investments or provide financial assistance to others outside the scope of the Company’s consolidated statements within 12 months after the supplement working capital.

The provisions of the preceding paragraph shall not apply to investment funds related to the main business jointly invested by the Company and specialized investment institutions, or investment funds such as industrial investment funds in poverty-stricken areas and public welfare funds for poverty alleviation operated in the market.

Where the exceed fund are used for permanent supplement working capital or repayment of bank loans, they shall be considered and approved by the Board of Directors and the shareholders’ meeting of the Company, and the conditions for online voting shall be provided for shareholders, and the independent directors, the Board of Supervisors, the sponsor or the independent financial advisor shall express their explicit consent. The Company shall report to the Shanghai Stock Exchange within 2 trading days after the meeting of the Board of Directors and announce the following contents:

• (1) The basic information of the raised funds, including the time of raising, the total amount of raised funds, the net amount of raised funds and the amount of excess fund;

XIII – 11

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

• (2) The commitment made by the Company that no high-risk investments shall be made and no financial assistance shall be offered to others within 12 months after the working capital is supplemented;

• (3) Opinions issued by the independent non-executive directors, the Supervisory Committee, the sponsor or the independent financial advisor of the Company.

Article 27 After the completion of a single investment project, the Company’s utilization of the remaining proceeds of that project (including interest income) in other investment projects is subject to the approval of the Board, with the consent of independent directors, the Supervisory Committee, the sponsor agency or independent financial adviser. The Company shall make an announcement within 2 trading days after the Board meeting.

In the event that the remaining proceeds (including interest revenues) is less than RMB10 million, the use of such proceeds may be exempted from the aforesaid procedures but shall be disclosed in the annual report.

• Article 28 When the Company invests in the fundraising investment project, the fund expenditure must go through the examination and approval procedures in strict accordance with the relevant provisions on the use of the Company’s monetary funds. All expenditures involving the raised funds shall be applied for by the relevant departments according to the plan for the use of funds and the progress of the implementation of the investment project, and the financial department shall handle the payment procedures after submitting for approval according to the Company’s fund approval authority.

CHAPTER 4 CHANGES IN INVESTMENT DIRECTION OF RAISED FUNDS

Article 29 In case of any of the following situations, the Company shall be deemed to have changed the use of raised funds:

• (1) Cancelling or terminating the original fundraising investment project, and carrying out new projects or supplementing working capital;

• (2) Changing the entity which is in charge of implementing the fundraising investment project, except for the change between the Company and its wholly-owned or controlled subsidiaries;

• (3) Changing the method of carrying out the fundraising investment project;

• (4) Other situations as determined by Shanghai Stock Exchange.

XIII – 12

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

Article 30 The funds raised by the Company shall be used pursuant to the purposes described in the prospectus or the fundraising introductions. prospectus. Any change in the fundraising investment project shall be subject to the review and approval by the Board of Directors and the shareholders’ meeting, for which an explicit consent is also required to be obtained from the independent nonexecutive directors, the Supervisory Committee, and the sponsor or independent financial advisor.

If the Company only changes the location where the fundraising investment project is carried out, the procedures in the preceding paragraph may be ignored, provided that the change shall be subject to the examination and approval by the Board of Directors, and the Company shall disclose the reasons for the change and the opinions issued by the sponsor or independent financial advisor within 2 trading days.

• Article 31 The fundraising investment project after the change shall be invested in the main business. The Company shall conduct a scientific and prudent analysis of the feasibility of the new investment project, and ensure the good market prospects and profitability of the investment project, so as to effectively prevent investment risks and enhance the use efficiency of the raised funds.

• Article 32 In principle, the use of raised funds and project investment shall be implemented in accordance with the plans stipulated in the prospectus, the fundraising instructions and other information disclosure documents. If there are special reasons for applying for alteration, the department that requires alteration shall submit the reasons and plans for alteration, and the project management department shall submit the reasons and plans for alteration to the general manager, then propose to the Board of Directors.

• Article 33 The Board of Directors of the Company may employ an intermediary agency to conduct a special evaluation on the change plan for the use of raised funds proposed by the project management department, which is confirmed and submitted by the general manager, if necessary, and make a resolution on whether to change it on the basis of the evaluation.

• Article 34 If the Company intends to change the fundraising investment project, it shall report to the Shanghai Stock Exchange within 2 trading days after submitting it to the Board of Directors for review and announce the following contents:

• (1) Basic information of the original fundraising investment project and the specific reasons for the change;

XIII – 13

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

• (2) Basic information, feasibility analysis and risk warning of the new fundraising investment projects;

• (3) The investment plan for the new fundraising investment projects;

• (4) A statement that the new fundraising investment project has obtained the approval from or is to be approved by the relevant competent authority (if applicable);

• (5) Opinions issued by independent directors, the Supervisory Committee, and the sponsor or the independent financial advisor on the change of the original fundraising investment project;

• (6) The explanation for the change of the fundraising investment project that is still subject to the approval by the shareholders’ meeting;

• (7) Other contents as determined by Shanghai Stock Exchange.

If a new fundraising investment project involves related party transactions, the purchase of assets, or external investment, it shall also be disclosed pursuant to the relevant rules.

Article 35 If the Company intends to acquire the assets (including rights and interests) of the controlling shareholder or de facto controller by changing the fundraising investment project, the Company shall ensure that the horizontal competition can be effectively prevented and related party transactions can be reduced after the acquisition.

• Article 36 If the Company intends to transfer or replace the fundraising investment project (except for the fundraising investing projects that have been completely transferred or replaced during the Company’s material asset restructuring), it shall report to the Shanghai Stock Exchange within two trading days after submitting it to the Board of Directors for consideration and announce the following contents:

• (1) The specific reasons for the external transfer or replacement of the fundraising investment project;

• (2) The amount of the raised funds already used for the project;

• (3) The degree of completion of the realized benefits of the project;

• (4) Basic information, feasibility analysis and risk warning (if applicable) of the transferred-in project;

XIII – 14

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

• (5) Pricing basis for the transfer or replacement and the relevant earnings;

• (6) Opinions issued by the independent directors, the Supervisory Committee, and the sponsor or the independent financial advisor on the transfer or replacement of the fundraising investment project;

• (7) The explanation for the transfer or replacement of the fundraising investment project that is still subject to the approval by the shareholders’ meeting;

• (8) Other contents as determined by Shanghai Stock Exchange.

The project management department of the Company shall keep an eye on the collection and use of the transfer price, the ownership change of the transferred-in assets and the continuous operation of the transferred-in assets, and fulfill the necessary information disclosure obligations.

CHAPTER 5 SUPERVISION AND MANAGEMENT OF THE USE OF RAISED FUNDS

Article 37 The project management department of the Company is responsible for the daily management and supervision of the use of raised funds, the establishment and improvement of relevant accounting records and accounts for activities related to the use of raised funds, the establishment of special files for the deposit and use of raise funds, and the independent accounting of fundraising investment projects. The financial management department of the project implementation unit shall check and verify the use of the raised funds on a quarterly basis and report it to the Company’s fund management department for review.

Article 38 The Board of Directors of the Company shall comprehensively check the progress of the fundraising investment projects every half year, and issue the Special Report on the Depository and Actual Use of the Raised Funds of the Company (the ‘‘Special Report on the Raised Funds’’).

In case of a discrepancy between the actual investment progress of the fundraising investment project and the investment plan, the Company shall give the specific explanations in the Special Report on Raised Funds. If idle raised funds are used for the product investment in the current period, the Company shall, in the Special Report on Raised Funds, disclose the earnings during the reporting period, closing investment shares, signatory parties, product names, terms and other information.

XIII – 15

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

The Special Report on Raised Funds shall be subject to the examination reviewed and approved by the Board of Directors and the Supervisory Committee, and shall be reported to the Shanghai Stock Exchange and announced within two trading days after being submitted to the Board of Directors for consideration. During the annual audit, the Company shall engage an accounting firm to issue an authentication report on the depository and use of the raised funds, and submit the report to the Shanghai Stock Exchange at the time of disclosure of the annual report, and disclose it on the website of the Shanghai Stock Exchange.

Article 39 The sponsor or independent financial advisor shall conduct an on-site investigation on the depository and use of the raised funds of the Company at least once every six months.

After the end of each fiscal year, the sponsor or independent financial advisor shall release a special verification report on the depository and use of the annual raised funds of the Company, and submit it to the Shanghai Stock Exchange when the Company discloses the annual report, and disclose it on the website of the Shanghai Stock Exchange. The verification report includes the following contents:

• (1) The depository and use of the raised funds and the balance of the special account;

• (2) The progress of the raised funds-related project, including the difference from the planned progress;

• (3) The use of raised funds to replace self-raised funds that are already used for the fundraising investment project in advance (if applicable);

• (4) The situation and effect of working capital supplemented with idle raised funds (if applicable);

• (5) The use situation of exceed funds (if applicable);

• (6) Changes of the investment direction of the raised funds (if applicable);

• (7) The conclusive opinions on whether the depository and use of the raised funds is in compliance with relevant provisions;

• (8) Other contents required by Shanghai Stock Exchange.

XIII – 16

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

After the end of each fiscal year, the Board of Directors shall disclose the conclusive opinions in the special verification report by the sponsor or independent financial advisor and the authentication report of the accounting firm.

Article 40 The independent directors, the Board of Directors, the Audit committee and the Supervisors committee shall continuously pay attention to the actual management and use of the raised funds.

The Board of Directors, the Audit committee and the Supervisors committee or more than half of the independent directors may engage an accounting firm to conduct a special audit on the deposit and use of raised funds and issue an authentication report. The Company shall actively cooperate and bear the necessary expenses.

The Board of Directors shall report to the Shanghai Stock Exchange and make an announcement within 2 trading days after receiving the authentication report specified in the preceding paragraph. If the authentication report considers that there are irregularities in the management and use of the Company’s raised funds, the Board of Directors shall also announce the irregularities in the deposit and use of the raised funds, the consequences that have been or may be caused, and the measures that have been or are to be taken.

Article 41

The directors, senior management and other authorized institutions, departments or personnel of the Company shall exercise their powers and engage in business management in accordance with the law and prudently within the scope of authorization. If they violate laws, regulations, rules, other regulatory documents, the regulatory rules of the securities regulatory authorities or stock exchanges in the place where the Company’s shares are listed, the Articles of Association and the provisions of this System and act beyond their powers, If the Company’s reputation is affected or economic losses are caused, the Company will investigate the responsibility of the direct responsible person or the principal responsible person of the relevant institutions and departments. The following acts will be considered as violations of this System:

• (1) Failing to use the raised funds according to the purpose of the Company’s raised funds;

• (2) The unit that actually uses the raised funds changes the use of the raised funds without authorization;

XIII – 17

APPENDIX XIII

MANAGEMENT SYSTEM FOR A SHARE RAISED PROCEEDS

• (3) Failing to perform the disclosure obligation in accordance with the provisions of this System and relevant laws and regulations;

• (4) Other acts in violation of this system identified by the Company.

CHAPTER 6 SUPPLEMENTARY PROVISIONS

Article 42 Matters not covered in the System shall be implemented in accordance with relevant national laws, administrative regulations, normative documents and the Articles of Association of the Company.

• Article 43 In case of the System being in conflict with relevant effective laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association, such effective laws, regulations, regulatory documents in force at that time and the provisions of the Articles of Association shall prevail.

• Article 44 These System shall be interpreted by the Board.

• Article 45 The System shall be subject to the consideration and approval of the shareholders’ meeting of the Company and shall take effect from the date on which the Company’s A shares issued under the initial public offering are listed on the Shanghai Stock Exchange.

XIII – 18

APPENDIX XIV

INVESTOR RELATIONS MANAGEMENT POLICIES

CHAPTER 1 GENERAL PROVISIONS

• Article 1 In order to strengthen information communication between MicroTech Medical (Hangzhou) Co., Ltd. (hereinafter referred to as the ‘‘Company’’) and shareholders and potential investors (hereinafter referred to as the ‘‘Investors’’), deepen investors’ understanding and recognition of the Company, and safeguard the interests of investors, the System is hereby formulated in accordance with the Company Law of the People’s Republic of China, Securities Law of the People’s Republic of China, the Guidelines for Investor Relations Management of Listed Companies, the Rules on the Listing of Shares on Science and Technology Innovation Board of Shanghai Stock Exchange, and other laws, regulations, rules, regulatory documents and the provisions of the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (hereinafter referred to as the ‘‘Articles of Association’’), taking into account the actual situation of the Company.

• Article 2 Investor relationship management refers to the important work of the Company to strengthen communication with investors through full information disclosure and communication, promote investors’ understanding and recognition of the Company, improve governance level, so as to maximize the overall interests of the Company and protect the legitimate rights and interests of investors.

CHAPTER 2 OBJECTIVES AND BASIC PRINCIPLES OF INVESTOR RELATIONS MANAGEMENT

Article 3 The basic principles of the investor relations management are as follows:

• (1) The principle of compliance: the investor relations management of the Company shall be carried out on the basis of performing the information disclosure obligation and shall comply with relevant laws, regulations, rules and regulatory documents, industry norms and self-discipline rules, the Company’s internal rules, and industry-wide ethics and Code of Conduct.

• (2) The principle of equality: while conducting investor relations management activities, the Company shall treat all investors equally and especially create opportunities for and facilitate the participation of small and medium-sized investors.

• (3) The principle of initiatives: the Company shall take the initiative to conduct investor relations management activities, listen to investors’ opinions and suggestions, and respond to investors’ demands in a timely manner.

XIV – 1

INVESTOR RELATIONS MANAGEMENT POLICIES

APPENDIX XIV

• (4) The principle of integrity and trustworthiness: As a listed company, the Company shall lay stress on integrity, adhere to the bottom line, standardize the business operations, actively take responsibility and strive for the good market ecology in performing investor relations management activities.

• Article 4 The controlling shareholder, de facto controller, directors, supervisors and senior management of the Company shall lay stress on, actively participate in and provide great support for the investor relations management of the Company.

• Article 5 The investors are encouraged to enhance the shareholder’s awareness, actively participate in the investor relationship management activities of the Company, exercise the rights as a shareholder under law, and rationally safeguard their legitimate rights and interests.

CHAPTER 3 DETAILS AND METHODS OF INVESTOR RELATIONS MANAGEMENT

Article 6 The details of investor relations communication mainly include:

• (1) The Company’s development strategy;

• (2) The content of statutory information disclosure;

• (3) Information of the Company’s business management;

• (4) Information of the Company’s environmental, social and governance practices;

• (5) The building of corporate culture;

• (6) Ways, channels and procedures for shareholders to exercise their rights;

• (7) Information of how the Company processes the investors’ requests;

• (8) Risks and challenges that the Company is facing or is likely to face;

• (9) Other relevant information of the Company.

XIV – 2

INVESTOR RELATIONS MANAGEMENT POLICIES

APPENDIX XIV

• Article 7 The Company shall perform investor relations management through multiple channels, platforms and ways, including the use of the Company’s official website, new media platform, telephone, fax, e-mail, investor education base and other channels, the use of the network infrastructure platforms of China investor network, the stock exchange, the securities depositary and clearing institutions and others, and the communication with investors through the shareholders’ meeting, investor presentations, roadshows, analyst meetings, reception of visitors, and symposiums. The communication shall be conducted in a way that is convenient for investors to participate, and the Company shall identify and eliminate the obstacles that affect communication.

• Article 8 The Company shall provide investors with the telephone number, fax number and email address, and the special persons familiar with the relevant situation shall be designated to take charge, to ensure that the telephone lines are unblocked during working hours, the phones are answered in a friendly way, and feedbacks are made to investors in effective forms. In case of any change in the telephone number and address, it shall be published in a timely manner.

• Article 9 The Company shall make more efforts for the construction, operation and maintenance of investor network communication channels, establish the investor relations column on the Company’s official website, collect and reply to investors’ inquiries, complaints and suggestions, and promptly release and update the information on investor relations management.

• The Company shall carry out the investor relations management through the active use of the public welfare network infrastructure such as China investor network and the Investor Relations Interactive Platform of Stock Exchange.

• Article 10 The Company may arrange for investors, fund managers and analysts to pay an on-site visit to the Company for discussions and communication.

• The activities shall be arranged in a reasonable and proper manner so as to prevent visitors from getting inside information and undisclosed information of major events.

• Article 11 The Company may communicate the corporate situation, answer questions and listen to relevant opinions and suggestions through roadshows, analyst meetings and other means.

XIV – 3

INVESTOR RELATIONS MANAGEMENT POLICIES

APPENDIX XIV

Article 12 The Company and other personnel in charge of information disclosure shall, in a timely and fair manner, fulfill their information disclosure obligations in strict accordance with laws and regulations, self-discipline rules and the Articles of Association. The information disclosed shall be true, accurate, complete, concise, clear, and accessible, and shall contain no false records, misleading statements or material omissions.

Article 13 The Company shall give full consideration to the time, venue and means of convening shareholders’ meeting, offer convenience for shareholders, especially minority shareholders to attend the shareholders’ meeting, and provide adequate time for investors to speak, raise questions and communicate with the Company’s directors, supervisors and senior management. The shareholders’ meeting shall provide the means of online voting.

The Company may fully communicate with investors and extensively solicit opinions after the announcement is made in accordance with the information disclosure rules and before the shareholders’ meeting is held.

Article 14 In addition to fulfilling the information disclosure obligation in accordance with the law, the Company shall actively hold investor presentations pursuant to the relevant requirements of the China Securities Regulatory Commission and the stock exchange, so as to provide relevant information to investors, answer their questions and listen to their suggestions. Investor presentations include briefings business results, cash dividends and significant events. In general, the Chairman of the Board or the General Manager shall attend the investor presentations, and shall provide the reasons when they cannot be present at the presentations.

The Company shall publish the notices prior to holding investor presentations and disclose relevant details of the presentations after they are concluded. The investor presentations shall be held in the way that facilitate investors’ participations, and the on-site ones can be livestreamed through online channels.

Article 15 The Company shall hold investor presentations in accordance with the requirements of China Securities Regulatory Commission and the stock exchange under the following circumstances:

• (1) The Company’s current cash dividends fail to meet the relevant requirements and the Company needs to explain the reasons;

• (2) The Company terminates the reorganization after it has disclosed the reorganization plan or the reorganization report;

XIV – 4

INVESTOR RELATIONS MANAGEMENT POLICIES

APPENDIX XIV

• (3) Abnormal fluctuations as stipulated in the relevant rules occur to the Company’s securities trading, and the Company notices undisclosed significant events after review;

• (4) The significant events of the Company are highly concerned or questioned by the market;

• (5) Other circumstances under which an investor presentation shall be held.

• Article 16 After the disclosure of the annual report, the Company shall, pursuant to the regulations of China Securities Regulatory Commission or the stock exchange, hold a results briefing (meeting) in a timely manner, providing investors with information of development of the industry in which the Company operates, its development strategies, production and operation, financial position, profit distribution, risks and difficulties, and other issues that investors are concerned about. The Company shall collect investors’ questions before holding results briefing and emphasize the effect of interactions with investors, which can be in video, audio and other forms.

• Article 17 If investors exercise their rights as shareholders in accordance with the law and investor protection institutions hold the stake and exercise their rights, publicly collect shareholders’ rights, resolve disputes, involve in representative actions and take part in other activities that safeguard investors’ legitimate rights and interests, the Company should actively support and cooperate with such activities. In case of a dispute between any investor and the Company, both parties may apply to the mediation organization for mediation. Where an investor requests for mediation, the Company shall actively cooperate with the investor.

• Article 18 The Company shall bear the primary responsibility for handling the claims lodged by the investor to the Company, deal with them in accordance with the law, and respond to the investor in a timely manner.

• Article 19 The Company shall make a clear distinction between publicity advertisements and media reports, and shall not influence the objective and independent coverage of the media by using its promotion materials and offering compensation.

The Company shall closely follow the publicity reports of the media and make appropriate responses when necessary.

XIV – 5

INVESTOR RELATIONS MANAGEMENT POLICIES

APPENDIX XIV

CHAPTER 4 ORGANIZATION AND IMPLEMENTATION OF INVESTOR RELATIONS MANAGEMENT

Article 20 The major duties of the investor relations management of the Company shall include:

• (1) To develop an investor relations management system and establish a work mechanism;

• (2) To organize investor relations management activities for communication with investors;

• (3) To make arrangements for promptly and properly respond to investors’ inquiries, complaints, advice and other appeals, and give regular feedbacks to the Board of Directors and the management of the Company in this regard;

• (4) To manage, operate and maintain relevant channels and platforms of investor relations management;

• (5) To ensure that investors can exercise their rights as shareholders under the law;

• (6) To support and cooperate with investor protection institutions in their works for safeguarding the legitimate rights and interests of investors;

• (7) To make statistical analysis of the number, composition and changes of the Company’s investors;

• (8) To conduct other activities that can help to improve investor relations.

• Article 21 The secretary of the Board of Directors is responsible for the organization and coordination of investor relations management. The controlling shareholder, de facto controller, directors, supervisors and senior management of the Company shall provide facilitation to the secretary of the Board of Directors for discharging their duties in respect of investor relations management.

Article 22 The Company needs to set up the office of the secretary of the Board of Directors with specialized staff to perform investor relations management work.

XIV – 6

INVESTOR RELATIONS MANAGEMENT POLICIES

APPENDIX XIV

Article 23

The Company and its controlling shareholder, de facto controller, directors, supervisors, senior management and employees shall not engage in investor relations management activities where any of the following circumstances applies:

• (1) To disclose or publish the information of any significant event that has not been made public, or information that conflicts with those disclosed in accordance with the law;

• (2) To disclose or publish any misleading, false or exaggerating information;

• (3) To disclose or publish selective information, or any information that contains material omissions;

• (4) To provide forecast or undertaking for the prices of the Company’s securities;

• (5) To speak on behalf of the Company without explicit authorization;

• (6) Discrimination, disrespect and other acts that treat minority shareholders unfairly or lead to unfair disclosure;

• (7) To violate public order and moral, and undermine public interest;

• (8) Other acts that violate the regulations on information disclosure, or affecting the normal trading of the Company’s securities and their derivatives.

Article 24

The personnel of the Company engaged in the investor relations management shall possess the following qualities and skills:

• (1) Good moral character and professional quality, honesty and trustworthiness;

• (2) Good professional knowledge structure, familiar with corporate governance, financial accounting and other relevant laws and regulations, and the operation mechanism of the securities market;

• (3) Good communication and coordination skills;

• (4) Comprehensive understanding of the situation of the Company and the industry in which the Company operates.

XIV – 7

INVESTOR RELATIONS MANAGEMENT POLICIES

APPENDIX XIV

Article	25	The Company shall regularly provide systematic training on investor relations
		management for its directors, supervisors, senior management and employees
		as appropriate, and shall encourage directors, supervisors, senior management
		and employees to attend relevant trainings organized by China Securities
		Regulatory Commission and its branches, the stock exchange, the securities
		depositary and clearing institutions, and China Association of Public
		Companies.
Article	26	The Company shall establish and improve the archives of investor relations
		management, and may set up an investor relations management database as
		appropriate, which shall be archived in an electronic or paper form.
		When conducting a variety of investor relations management activities, the
		Company shall record the activities and communication contents in written
		form and by means of graphs, audio and video, and store these records in the
		investor relations management archives. The content classification, use and
		disclosure, and retention period of the archives shall be governed by the
		specific regulations of the Shanghai Stock Exchange.
		CHAPTER 5 SUPPLEMENTARY PROVISIONS
Article	27	Matters not covered in the System shall be implemented in accordance with
		relevant laws, regulations, regulatory documents，as well as the listing rules
		of the place where the Company’s shares are listed and the Articles of
		Association.
Article	28	In case of the System being in conflict with the laws, regulations, regulatory
		documents in force at that time and the provisions of the Articles of
		Association, such laws, regulations, regulatory documents in force at that time
		and the provisions of the Articles of Association shall prevail.
Article	29	The System shall be interpreted by the Board.
Article	30	The System shall be subject to the consideration and approval of the
		shareholders’ meeting of the Company and shall take effect from the date on
		which the Company’s A shares issued under the initial public offering are
		listed on the Shanghai Stock Exchange.

XIV – 8

APPENDIX XV

REGULATION ON GOVERNING THE TRANSFER OF FUNDS WITH RELATED PARTIES

CHAPTER 1 GENERAL PROVISIONS

Article 1

In order to regulate and improve the fund management of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’), avoid its related parties from appropriating the Company’s funds, establish a long-term effective mechanism to prevent against the appropriation of Company’s funds by the related parties of the Company, and protect the legitimate rights and interests of the Company, the shareholders and other stakeholders, the Company has formulated this Regulation on Governing the Transfer of Funds with Related Parties of MicroTech Medical (Hangzhou) Co., Ltd.（《微泰醫療器械（杭州）股 份 有 限 公 司 規 範 與 關 聯 方 資 金 往 來 的 管 理 制 度 》）(the ‘‘ Regulation ’’ ) according to the Company Law of the People’s Republic of China (the ‘‘Company Law’’), the Securities Law of the People’s Republic of China, the Rules Governing the Listing of Stocks on the STAR Market of the Shanghai Stock Exchange（《上海證券交易所科創板股票上市規則》）(the ‘‘Listing Rules’’), the Shanghai Stock Exchange Self-Regulatory Supervision Guidelines for Listed Companies No. 1 – Standardised Operation（《上海證券 交易所上市公司自律監管指引第1號－規範運作》）and other laws, regulations and regulatory documents and relevant provisions in the Articles of Association of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Articles of Association’’).

• Article 2 The Regulation shall apply to the Company and to the subsidiaries included in the Company’s consolidated accounting statements.

• Article 3 The Directors, Supervisors and senior management of the Company shall have the legal obligation to safeguard the safety of the Company’s funds. Related parties of the Company shall not, by means of the appropriation of funds, harm the interests of the Company, infringe the rights of the Company’s property or exploit the Company’s business opportunities.

• Article 4 Appropriation of funds as referred to in the Regulation includes but is not limited to the following:

• (1) Appropriation of operating funds: appropriation of funds by the related parties of the Company through related party transactions arising from purchases, sales and other activities relating to production and operation;

XV – 1

APPENDIX XV

REGULATION ON GOVERNING THE TRANSFER OF FUNDS WITH RELATED PARTIES

• (2) Appropriation of non-operating funds: advances provided by the Company for expenses such as wages, welfare, insurance, advertisement fees, etc. and other expenditures for the related parties; loans advanced directly or indirectly to the related parties with or without cost; repayments of debts (on their behalf) and other funds provided to the related parties without consideration for goods and labour services.

CHAPTER 2 REGULATION ON TRANSFER OF FUNDS WITH RELATED PARTIES OF THE COMPANY

Article 5

Appropriation of the Company’s funds shall be strictly restricted in the transfer of operating funds of the Company with its related parties. The related parties shall not request the Company for advance payment of wages, welfare, insurance, advertisement and other periodic expenses, nor shall they undertake each other’s costs and other expenditures.

Article 6 The Company shall not provide funds, directly or indirectly, to the related parties for their use by the following means:

• (1) lending the Company’s funds to the related parties with or without compensation;

• (2) providing entrusted loans to the related parties through banks or nonbanking financial institutions;

• (3) entrusting the related parties to carry out investment activities;

• (4) issuing commercial acceptance bills to the related parties without a true underlying transaction;

• (5) repaying debts for its related parties;

• (6) any other means as recognized by domestic and overseas securities regulatory authorities.

XV – 2

APPENDIX XV

REGULATION ON GOVERNING THE TRANSFER OF FUNDS WITH RELATED PARTIES

• Article 7 The Company shall implement related party transactions between the Company and its related parties through purchases, sales and other activities relating to production and operation in accordance with the relevant laws and regulations, the Articles of Association and the relevant policies on related party transactions of the Company.

• Article 8 The Company shall strictly prevent the related parties from appropriating the non-operating funds, and continue to establish a long-term effective mechanism to prevent the controlling shareholders from appropriating the non-operating funds. The finance department and the internal audit department of the Company shall regularly check the transfer of non-operating funds between the Company’s head office and its subsidiaries with the related parties respectively.

• Article 9 When performing the audit of the annual financial and accounting report of the Company, the certified public accountants shall issue a special explanation on the appropriation of funds by the related parties of the Company in accordance with the above provisions. The Company shall make an announcement on the special explanation.

CHAPTER 3 SETTLEMENT PROCEDURES OF RELATED PARTY TRANSACTIONS

• Article 10 When a payment is required to be made in connection with related party transactions between the Company and its controlling shareholders, de facto controllers and other related parties, the finance department of the Company shall, in addition to using the relevant agreements, contracts and other documents as the basis for payment, examine whether the matters forming the basis for payment comply with the decision-making procedures as stipulated in the Articles of Association and other governance standards.

• Article 11 The finance department of the Company shall strictly observe the rules and regulations and financial discipline of the Company when handling payment matters with the controlling shareholders, de facto controllers and other related parties.

XV – 3

APPENDIX XV

REGULATION ON GOVERNING THE TRANSFER OF FUNDS WITH RELATED PARTIES

CHAPTER 4 REGULATION ON RESPONSIBILITIES AND MEASURES FOR TRANSFER OF FUNDS WITH RELATED PARTIES

• Article 12 The board of directors shall establish verification systems to regularly check the Company’s restricted monetary funds and assets, as well as the transactions and transfer of funds with the related parties of the Company, focus on any abnormality in the relevant accounting items in the financial reports, and verify whether funds, assets or other resources of the Company have been appropriated, transferred by the related parties of the Company, or any other circumstances where the Company’s interests have been infringed. Abnormalities shall be disclosed immediately once identified.

• Article 13 The finance department of the Company shall regularly inspect the Company and its subsidiaries, report the investigation on the transfer of non-operating funds with the Company’s related parties, and firmly eliminate the appropriation of non-operating funds by the related parties of the Company. The internal audit department shall regularly conduct internal audit on the appropriation of funds by the related parties of the Company, supervise and inspect the implementation of operating activities and internal control, assess on the subjects and matters being inspected, and provide improvement suggestion and solutions to ensure the consistent implementation of internal control and the normal operation of production and operation activities.

• Article 14 The shareholders’ meeting, the board of directors and the general manager of the Company shall consider and approve the related party transactions to be carried out by the Company with its related parties through purchases, sales and other activities relating to production and operation, according to their respective authorities and duties stipulated in the Articles of Association and the Management Policy of Related Party Transactions of the Company. When providing funds to related parties due to related party transactions, relevant provisions in related party transaction agreement and fund management shall be strictly implemented in accordance with the fund approval and payment procedures, and it shall not lead to abnormal appropriation of operating funds.

XV – 4

REGULATION ON GOVERNING THE TRANSFER OF FUNDS WITH RELATED PARTIES

APPENDIX XV

• Article 15 In the event of embezzlement of the Company’s assets by the related parties in detriment to the interest of the Company and the public shareholders, the board of directors of the Company shall take effective measures to demand such related parties to stop the embezzlement and make compensation for the loss accordingly. If such related parties refuse to make rectification, the board of directors of the Company shall report such incident in a timely manner to the relevant securities regulatory authorities and take legal actions against such related parties in order to safeguard the legitimate rights and interests of the Company and public shareholders.

• Article 16 For related parties’ appropriation of the Company’s funds, after being reviewed and approved by the board of directors of the Company, the board of directors may, in the name of the Company, apply for the adoption of such compulsory measures as attaching, seizing or freezing the Company’s assets embezzled and shares held by the related parties. In cases of failure to settle in cash, the Company may reclaim the embezzled assets in accordance with the law through claiming their dividend, shareholding or asset as repayment. When the board of directors considers relevant matters, the directors of the related parties shall abstain from voting. In considering relevant matters at the shareholders’ meeting of the Company, the controlling shareholders of the Company shall abstain from voting in accordance with the law, and the total number of shares with voting rights attached thereto held by them shall not be counted towards the total number of shares with valid voting rights at such shareholders’ meeting.

CHAPTER 5 ACCOUNTABILITY AND PENALTY

• Article 17 The Directors, Supervisors and senior management have the obligations to safeguard the Company’s funds from appropriation by the Company’s related parties. If the Company’s Directors or senior management are found to assist or condone the embezzlement of the Company’s assets by the related parties, the board of directors of the Company shall, according to the seriousness of the circumstances, warn, dismiss or punish the senior management who are directly responsible, and investigate their criminal responsibility if the circumstances are serious in violation of the criminal law. The Directors who are directly responsible shall be given a warning, and the Directors who are seriously responsible shall be brought to the shareholder’ meeting of the Company to initiate the procedure of dismissal and investigation of criminal responsibility. The Supervisory Committee of the Company shall effectively perform its supervisory functions.

XV – 5

APPENDIX XV

REGULATION ON GOVERNING THE TRANSFER OF FUNDS WITH RELATED PARTIES

• Article 18 Where losses are caused or may be caused to the Company due to the appropriation or transfer of the Company’s funds, assets or other resources by related parties, the board of directors of the Company shall promptly take protective measures such as litigation and property preservation to avoid or reduce losses, and hold relevant personnel accountable.

CHAPTER 6 SUPPLEMENTARY PROVISIONS

• Article 19 Matters which are not covered herein shall be dealt with in accordance with the provisions of relevant national laws or regulations and the Articles of Association.

• Article 20 In case of the Regulation being in conflict with the provisions of the then effective laws, regulations, regulatory documents and the Articles of Association, the provisions of the then effective laws, regulations, regulatory documents and the Articles of Association shall prevail.

• Article 21 The board of directors of the Company shall be responsible for interpreting this regulation.

• Article 22 This regulation is reviewed and approved by the shareholders’ meeting of the Company, and shall take effect from the date on which the shareholders’ meeting of the Company approves the regulation.

XV – 6

NOTICE OF THE 2022 FIRST EXTRAORDINARY GENERAL MEETING

==> picture [124 x 46] intentionally omitted <==

==> picture [32 x 43] intentionally omitted <==

MicroTech Medical (Hangzhou) Co., Ltd. ����������������

(A joint stock company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 2235)

NOTICE OF THE 2022 FIRST EXTRAORDINARY GENERAL MEETING

NOTICE IS HEREBY GIVEN that the 2022 first Extraordinary General Meeting (the ‘‘EGM’’) of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) will be held at Business Conference Room, 3rd Floor, MicroTech Medical Administration Building, No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China on Wednesday, December 7, 2022 at 2:00 p.m. for the purposes of considering and, if deemed appropriate, approving the following resolutions. Unless otherwise indicated, capitalised terms used herein shall have the same meanings as ascribed to them in the circular dated Monday, November 21, 2022 issued by the Company (the ‘‘Circular’’).

SPECIAL RESOLUTIONS

1. To consider and approve the proposed A Share Offering (please refer to the content set out in the section headed ‘‘The Proposed A Share Offering’’ in the Circular for further details):

2. (a) Place of listing;

3. (b) Class of securities to be issued;

4. (c) Nominal value of shares;

5. (d) Target subscribers;

6. (e) Schedule of the offering;

7. (f) Method of offering;

8. (g) Offering size;

9. (h) Pricing methodology;

10. (i) Implementation of strategic placing upon issue;

– 45 –

NOTICE OF THE 2022 FIRST EXTRAORDINARY GENERAL MEETING

• (j) Method of underwriting; and

• (k) Validity period of resolutions in relation to the Offering.

• To consider and approve the authorization to the Company’s board and its authorized persons to deal with specific matters relating to the proposed A Share Offering with full discretion (please refer to the content set out in the section headed ‘‘Authorization to the Board and its authorized persons to deal with specific matters relating to the proposed A Share Offering with full discretion’’ in the Circular for further details);

• To consider and approve the investment projects financed by proceeds from the proposed A Share Offering and the relevant feasibility analysis (please refer to the content set out in the section headed ‘‘Investment Projects and/or Allocation to be financed by the Proceeds from the A Share Offering and the Relevant Feasibility Analysis’’ in the Circular for further details);

• To consider and approve the proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering (please refer to the content set out in the section headed ‘‘Proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering’’ in the Circular for further details);

• To consider and approve the plan for stabilizing A Share price within three years after the proposed A Share Offering as set out in Appendix I to the Circular;

• To consider and approve the dilution of immediate return as a result of the A Share Offering and recovery measures (please refer to the content set out in the section headed ‘‘Dilution of immediate return as a result of the A Share Offering and recovery measures’’ in the Circular for further details);

• To consider and approve the plan for dividend distribution to Shareholders in three years after the proposed A Share Offering as set out in Appendix II to the Circular;

• To consider and approve the undertakings and restraining measures in respect of the proposed A Share Offering as set out in Appendix III to the Circular;

– 46 –

NOTICE OF THE 2022 FIRST EXTRAORDINARY GENERAL MEETING

• 9.* To consider and approve (i) the Proposed Amendments to the Current Articles of Association, details of which are set out in Appendix IV-A to the Circular; and (ii) the adoption of the Amended Articles of Association which contains all the Proposed Amendments to the Current Articles of Association (a copy of which has been proposed at this EGM and marked ‘‘A’’ and initialed by the chairman of the EGM) in substitution for and to the exclusion of the current articles of association of the Company with immediate effect;

• 10.* To consider and approve (i) the Proposed Amendments to the Articles of Association for the A Share Offering, details of which are set out in Appendix IV-B to the Circular; and (ii) the adoption of the Amended Articles of Association which contains all the Proposed Amendments to the Articles of Association for the A Share Offering (a copy of which has been proposed at the EGM and marked ‘‘B’’ and initialed by the chairman of the EGM) in substitution for and to the exclusion of the current articles of association of the Company with immediate effect.

ORDINARY RESOLUTIONS

1. To consider and approve the engagement of intermediaries (please refer to the content set out in the section headed ‘‘Engagement of intermediaries’’ in the Circular for further details);

2. To consider and approve the confirmation of the Company’s related-party transactions in the past three years (please refer to the content set out in the section headed ‘‘Confirmation of the Company’s related-party transactions during the three years ended December 31, 2021 and the six months ended June 30, 2022’’ in the Circular for further details);

3. To consider and approve the report on the use of proceeds from the previous fundraising activity as set out in Appendix V to the Circular;

4. To consider and approve the amendment or formulation of internal management policies of the Company as set out in Appendix VI to Appendix XV to the Circular;

– 47 –

NOTICE OF THE 2022 FIRST EXTRAORDINARY GENERAL MEETING

1. To consider and approve the appointment of Dr. Cheng Hua as an independent nonexecutive director of the Company.

2. For the avoidance of doubt, given that the proposed A Share Offering is conditional upon, among other things, necessary regulatory approvals, there is no assurance that it will proceed as planned or at all. Therefore, despite that the Shareholders will consider and, if thought fit, approve the adoption of both versions of the Articles of Association, only one version of it will have become effective at the time immediately following the EGM. The effect of the Shareholders considering, and if thought fit, approving, both versions of the Amended Articles of Association is that, before and until the A Share Offering has been successfully completed, the version of the Amended Articles of Association incorporating and consolidating all the Proposed Amendments to the Current Articles of Association will have remained effective and, vice versa.

By Order of the Board MicroTech Medical (Hangzhou) Co., Ltd. Dr. Zheng Pan Chairman of the Board.

Hangzhou, the PRC, November 21, 2022

Notes:

• (i) Any shareholder of the Company entitled to attend and vote at the EGM is entitled to appoint one or more proxies to attend and, on a poll, vote instead of him/her. A proxy need not be a member of the Company.

• (ii) The instrument appointing a proxy shall be in writing under the hand of the appointer or of his/her attorney duly authorized in writing or, if the appointer is a corporation, either under its seal or under the hand of any officer or attorney duly authorized.

• (iii) In order to be valid, the form of proxy together with the power of attorney or other authority, if any, under which it is signed or a notarially certified copy of such power or authority, must be deposited with Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong (for holders of H shares) or the Company’s office at No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China (for Domestic Unlisted Shareholders) as soon as practicable but in any event not less than 24 hours before the time appointed for holding the EGM (i.e. not later than December 6, 2022 at 2:00 p.m.), or any adjourned meeting thereof (as the case may be).

• (iv) Completion and return of the form of proxy shall not preclude the Shareholders from attending and voting in person at the EGM or at any adjourned meeting thereof (as the case may be) should they so wish, and in such event, the form of proxy shall be deemed to be revoked.

• (v) Where there are joint registered holders of any share, any one of such joint holders may vote, either in person or by proxy, in respect of such share as if he/she was solely entitled thereto, but if more than one of such joint holders are present at the EGM, whether in person or by proxy, the joint registered holder present whose name stands first on the register of members of the Company in respect of the shares shall alone be entitled to vote in respect thereof.

– 48 –

NOTICE OF THE 2022 FIRST EXTRAORDINARY GENERAL MEETING

• (vi) For the purpose of determining the H shareholders of the Company entitled to attend and vote at the EGM, the register of members of H Shares will be closed from December 2, 2022 to December 7, 2022 (both days inclusive). All transfer documents must be lodged with the Company’s H Share registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong no later than 4:30 p.m. on Thursday, December 1, 2022 for registration. The record date for determining the entitlement of the Shareholders to attend and vote at the EGM will be Wednesday, December 7, 2022.

• (vii) Shareholders shall produce their identity documents and supporting documents in respect of the Shares held when attending the EGM. If corporate Shareholders appoint authorised representative to attend the EGM, the authorized representative shall produce his/her identity documents and a notarially certified copy of the relevant authorization instrument signed by the board of directors or other authorised parties of the corporate Shareholders or other notarially certified documents allowed by the Company. Proxies shall produce their identity documents and the proxy form signed by the Shareholders or their attorney when attending the EGM.

• (viii) Shareholders attending the EGM shall be responsible for their own travel and accommodation expenses.

• (ix) All resolutions at the EGM will be taken by poll (except where the chairman decides to allow a resolution relating to a procedural or administrative matter to be voted on by a show of hands) pursuant to the Hong Kong Listing Rules of the Hong Kong Stock Exchange. The results of the poll will be published on the websites of the Hong Kong Stock Exchange and the Company in accordance with the Hong Kong Listing Rules of the Hong Kong Stock Exchange.

• (x) All times refer to Hong Kong local time, except as otherwise stated.

• (xi) For any matter relating to the EGM, please contact the securities representative or the investor relationship department of the Group (via email: zhengdai@microtechmd.com; ir@microtechmd.com, respectively, or telephone: 0571-88566373-866).

– 49 –

NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS OF H SHARES

==> picture [124 x 46] intentionally omitted <==

==> picture [32 x 43] intentionally omitted <==

MicroTech Medical (Hangzhou) Co., Ltd. ����������������

(A joint stock company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 2235)

NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS OF H SHARES

NOTICE IS HEREBY GIVEN that the 2022 second class meeting of holders of H shares (the ‘‘Class Meeting of H Shareholders’’) of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) will be held at Business Conference Room, 3rd Floor, MicroTech Medical Administration Building, No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China on Wednesday, December 7, 2022 at 2:45 p.m. (or immediately after conclusion of the 2022 first EGM) for the purposes of considering and, if deemed appropriate, approving the following resolutions. Unless otherwise indicated, capitalized terms used herein shall have the same meanings as ascribed to them in the circular dated November 21, 2022 issued by the Company (the ‘‘Circular’’).

SPECIAL RESOLUTIONS

1. To consider and approve the proposed A Share Offering (please refer to the content set out in the section headed ‘‘The Proposed A Share Offering’’ in the Circular for further details):

2. (a) Place of listing;

3. (b) Class of securities to be issued;

4. (c) Nominal value of shares;

5. (d) Target subscribers;

6. (e) Schedule of the offering;

7. (f) Method of offering;

8. (g) Offering size;

9. (h) Pricing methodology;

10. (i) Implementation of strategic placing upon issue;

– 50 –

NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS OF H SHARES

• (j) Method of underwriting; and

• (k) Validity period of resolutions in relation to the Offering.

• To consider and approve the authorization to the Company’s board and its authorized persons to deal with specific matters relating to the proposed A Share Offering with full discretion (please refer to the content set out in the section headed ‘‘Authorization to the Board and its authorized persons to deal with specific matters relating to the proposed A Share Offering with full discretion’’ in the Circular for further details);

• To consider and approve the investment projects financed by proceeds from the proposed A Share Offering and the relevant feasibility analysis (please refer to the content set out in the section headed "Investment Projects and/or Allocation to be financed by the Proceeds from the A Share Offering and the Relevant Feasibility Analysis" in the Circular for further details);

• To consider and approve the proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering (please refer to the content set out in the section headed ‘‘Proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering’’ in the Circular for further details);

• To consider and approve the plan for stabilizing A Share price within three years after the proposed A Share Offering as set out in Appendix I to the Circular;

• To consider and approve the dilution of immediate return as a result of the A Share Offering and recovery measures (please refer to the content set out in the section headed ‘‘Dilution of immediate return as a result of the A Share Offering and recovery measures’’ in the Circular for further details);

• To consider and approve the plan for dividend distribution to Shareholders in three years after the proposed A Share Offering as set out in Appendix II to the Circular;

• To consider and approve the undertakings and restraining measures in respect of the proposed A Share Offering as set out in Appendix III to the Circular.

By Order of the Board

MicroTech Medical (Hangzhou) Co., Ltd.

Dr. Zheng Pan

Chairman of the Board

Hangzhou, the PRC, November 21, 2022

– 51 –

NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS OF H SHARES

Notes:

• (i) Any holder of H Shares entitled to attend and vote at the Class Meeting of H Shareholders is entitled to appoint one or more proxies to attend and, on a poll, vote instead of him/her. A proxy need not be a member of the Company.

• (ii) The instrument appointing a proxy shall be in writing under the hand of the appointer or of his/her attorney duly authorized in writing or, if the appointer is a corporation, either under its seal or under the hand of any officer or attorney duly authorized.

• (iii) In order to be valid, the form of proxy together with the power of attorney or other authority, if any, under which it is signed or a notarially certified copy of such power or authority, must be deposited with Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong as soon as practicable but in any event not less than 24 hours before the time appointed for holding the Class Meeting of H Shareholders (i.e. not later than December 6, 2022 at 2:45 p.m.), or any adjourned meeting thereof (as the case may be).

• (iv) Completion and return of the form of proxy shall not preclude the Shareholders from attending and voting in person at the Class Meeting of H Shareholders or at any adjourned meeting thereof (as the case may be) should they so wish, and in such event, the form of proxy shall be deemed to be revoked.

• (v) Where there are joint registered holders of any share, any one of such joint holders may vote, either in person or by proxy, in respect of such share as if he/she was solely entitled thereto, but if more than one of such joint holders are present at the Class Meeting of H Shareholders, whether in person or by proxy, the joint registered holder present whose name stands first on the register of members of the Company in respect of the shares shall alone be entitled to vote in respect thereof.

• (vi) For the purpose of determining the H Shareholders entitled to attend and vote at the Class Meeting of H Shareholders, the register of members of H Shares will be closed from December 2, 2022 to December 7, 2022 (both days inclusive). All transfer documents must be lodged with the Company’s H Share registrar, Tricor Investor Services Limited, at 17/F, Far East Finance Centre, 16 Harcourt Road, Hong Kong no later than 4:30 p.m. on Thursday, December 1, 2022 for registration. The record date for determining the entitlement of the H shareholders of the Company to attend and vote at the Class Meeting of H Shareholders will be December 7, 2022.

• (vii) Shareholders shall produce their identity documents and supporting documents in respect of the Shares held when attending the Class Meeting of H Shareholders. If corporate Shareholders appoint authorised representative to attend the Class Meeting of H Shareholders, the authorized representative shall produce his/her identity documents and a notarially certified copy of the relevant authorization instrument signed by the board of directors or other authorised parties of the corporate Shareholders or other notarially certified documents allowed by the Company. Proxies shall produce their identity documents and the proxy form signed by the Shareholders or their attorney when attending the Class Meeting of H Shareholders.

• (viii) Shareholders attending the Class Meeting of H Shareholders shall be responsible for their own travel and accommodation expenses.

• (ix) All resolutions at the Class Meeting of H Shareholders will be taken by poll (except where the chairman decides to allow a resolution relating to a procedural or administrative matter to be voted on by a show of hands) pursuant to the Hong Kong Listing Rules of the Hong Kong Stock Exchange. The results of the poll will be published on the websites of the Hong Kong Stock Exchange and the Company in accordance with the Hong Kong Listing Rules of the Hong Kong Stock Exchange.

• (x) All times refer to Hong Kong local time, except as otherwise stated.

• (xi) For any matter relating to the Class Meeting of H Shareholders, please contact the securities representative or the investor relationship department of the Group (via email: zhengdai@microtechmd.com; ir@microtechmd.com, respectively, or telephone: 0571-88566373-866).

– 52 –

NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS OF DOMESTIC UNLISTED SHARES

==> picture [124 x 46] intentionally omitted <==

==> picture [32 x 43] intentionally omitted <==

MicroTech Medical (Hangzhou) Co., Ltd. ����������������

(A joint stock company incorporated in the People’s Republic of China with limited liability)

(Stock Code: 2235)

NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS OF DOMESTIC UNLISTED SHARES

NOTICE IS HEREBY GIVEN that the 2022 second class meeting of holders of domestic unlisted shares (the ‘‘Class Meeting of Domestic Unlisted Shareholders’’) of MicroTech Medical (Hangzhou) Co., Ltd. (the ‘‘Company’’) will be held at Business Conference Room, 3rd Floor, MicroTech Medical Administration Building, No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China on Wednesday, December 7, 2022 at 3:00 p.m. (or immediately after conclusion of the 2022 second class meeting of holders of H shares) for the purposes of considering and, if deemed appropriate, approving the following resolutions. Unless otherwise indicated, capitalised terms used herein shall have the same meanings as ascribed to them in the circular dated Monday, November 21, 2022 issued by the Company (the ‘‘Circular’’).

SPECIAL RESOLUTIONS

1. To consider and approve the proposed A Share Offering (please refer to the content set out in the section headed ‘‘The Proposed A Share Offering’’ in the Circular for further details):

2. (a) Place of listing;

3. (b) Class of securities to be issued;

4. (c) Nominal value of shares;

5. (d) Target subscribers;

6. (e) Schedule of the offering;

7. (f) Method of offering;

8. (g) Offering size;

9. (h) Pricing methodology;

10. (i) Implementation of strategic placing upon issue;

– 53 –

NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS OF DOMESTIC UNLISTED SHARES

• (j) Method of underwriting; and

• (k) Validity period of resolutions in relation to the Offering.

• To consider and approve the authorization to the Company’s board and its authorized persons to deal with specific matters relating to the proposed A Share Offering with full discretion (please refer to the content set out in the section headed ‘‘Authorization to the Board and its authorized persons to deal with specific matters relating to the proposed A Share Offering with full discretion’’ in the Circular for further details);

• To consider and approve the investment projects financed by proceeds from the proposed A Share Offering and the relevant feasibility analysis (please refer to the content set out in the section headed "Investment Projects and/or Allocation to be financed by the Proceeds from the A Share Offering and the Relevant Feasibility Analysis" in the Circular for further details);

• To consider and approve the proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering (please refer to the content set out in the section headed ‘‘Proposal for distribution of accumulated profits retained or plan for undertaking of unrecovered losses incurred cumulatively prior to the A Share Offering’’ in the Circular for further details);

• To consider and approve the plan for stabilizing A Share price within three years after the proposed A Share Offering as set out in Appendix I to the Circular;

• To consider and approve the dilution of immediate return as a result of the A Share Offering and recovery measures (please refer to the content set out in the section headed ‘‘Dilution of immediate return as a result of the A Share Offering and recovery measures’’ in the Circular for further details);

• To consider and approve the plan for dividend distribution to Shareholders in three years after the proposed A Share Offering as set out in Appendix II to the Circular;

• To consider and approve the undertakings and restraining measures in respect of the proposed A Share Offering as set out in Appendix III to the Circular.

By Order of the Board

MicroTech Medical (Hangzhou) Co., Ltd.

Dr. Zheng Pan

Chairman of the Board

Hangzhou, the PRC, November 21, 2022

– 54 –

NOTICE OF THE 2022 SECOND CLASS MEETING OF HOLDERS OF DOMESTIC UNLISTED SHARES

Notes:

• (i) Any shareholder of Domestic Unlisted Shares entitled to attend and vote at the Class Meeting of Domestic Unlisted Shareholders is entitled to appoint one or more proxies to attend and, on a poll, vote instead of him/her. A proxy need not be a member of the Company.

• (ii) The instrument appointing a proxy shall be in writing under the hand of the appointer or of his/her attorney duly authorized in writing or, if the appointer is a corporation, either under its seal or under the hand of any officer or attorney duly authorized.

• (iii) In order to be valid, the form of proxy together with the power of attorney or other authority, if any, under which it is signed or a notarially certified copy of such power or authority, must be deposited with the Company’s office at No. 108 Liuze Street, Cangqian Street, Yuhang District, Hangzhou, Zhejiang, China as soon as practicable but in any event not less than 24 hours before the time appointed for holding the Class Meeting of Domestic Unlisted Shareholders (i.e. not later than December 6, 2022 at 3:00 p.m.), or any adjourned meeting thereof (as the case may be).

• (iv) Completion and return of the form of proxy shall not preclude the Shareholders of the Company from attending and voting in person at the Class Meeting of Domestic Unlisted Shareholders or at any adjourned meeting thereof (as the case may be) should they so wish, and in such event, the form of proxy shall be deemed to be revoked.

• (v) Where there are joint registered holders of any share, any one of such joint holders may vote, either in person or by proxy, in respect of such share as if he/she was solely entitled thereto, but if more than one of such joint holders are present at the Class Meeting of Domestic Unlisted Shareholders, whether in person or by proxy, the joint registered holder present whose name stands first on the register of members of the Company in respect of the shares shall alone be entitled to vote in respect thereof.

• (vi) The record date for determining the entitlement of holders of Domestic Unlisted Shares to attend and vote at the Class Meeting of Domestic Unlisted Shareholders will be December 7, 2022.

• (vii) Shareholders shall produce their identity documents and supporting documents in respect of the Shares held when attending the Class Meeting of Domestic Unlisted Shareholders. If corporate Shareholders appoint authorised representative to attend the Class Meeting of Domestic Unlisted Shareholders, the authorized representative shall produce his/her identity documents and a notarially certified copy of the relevant authorization instrument signed by the board of directors or other authorised parties of the corporate Shareholders or other notarially certified documents allowed by the Company. Proxies shall produce their identity documents and the proxy form signed by the Shareholders or their attorney when attending the Class Meeting of Domestic Unlisted Shareholders.

• (viii) Shareholders attending the Class Meeting of Domestic Unlisted Shareholders shall be responsible for their own travel and accommodation expenses.

• (ix) All resolutions at the Class Meeting of Domestic Unlisted Shareholders will be taken by poll (except where the chairman decides to allow a resolution relating to a procedural or administrative matter to be voted on by a show of hands) pursuant to the Hong Kong Listing Rules of the Hong Kong Stock Exchange. The results of the poll will be published on the websites of the Hong Kong Stock Exchange and the Company in accordance with the Hong Kong Listing Rules of the Hong Kong Stock Exchange.

• (x) All times refer to Hong Kong local time, except as otherwise stated.

• (xi) For any matter relating to the Class Meeting of Domestic Unlisted Shareholders, please contact the securities representative or the investor relationship department of the Group (via email: zhengdai@microtechmd.com; ir@microtechmd.com, respectively, or telephone: 0571-88566373-866).

– 55 –