Changmao Biochemical Engineering : GENERAL MANDATE TO ISSUE NEW SHARES AND NOTICE OF ANNUAL GENERAL MEETING

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action to be taken, you should consult your licensed securities dealer or registered institution in securities, bank manager, solicitor, professional accountant or other professional advisers.

If you have sold or transferred all your shares in Changmao Biochemical Engineering Company Limited*, you should at once hand this circular to the purchaser or transferee or to the bank, licensed securities dealer or registered institution in securities or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

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.

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purposes of giving information with regard to Changmao Biochemical Engineering Company Limited*. 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 in this circular misleading.

常 茂 生 物 化 學 工 程 股 份 有 限 公 司

Changmao Biochemical Engineering Company Limited*

(a joint stock limited company incorporated in the People's Republic of China)

(Stock Code: 954)

GENERAL MANDATE TO ISSUE NEW SHARES

AND

NOTICE OF ANNUAL GENERAL MEETING

Notice convening the AGM to be held at 10:30 a.m. on Tuesday, 18 May 2021 at Room 54, 5/F, New Henry House, 10 Ice House Street, Central, Hong Kong are set out on pages 7 to 10 of this circular.

Proxy form for use at the AGM are enclosed and are also published on the websites of the Stock Exchange (www. hkexnews.hk) and the Company (www.cmbec.com.hk).

Whether or not you are able to attend the AGM, you are advised to complete the enclosed proxy form in accordance with the instructions printed thereon and return it, in the case of holders of Domestic Shares and Foreign Shares, to the principal place of business of the Company in Hong Kong at Room 54, 5th Floor, New Henry House, 10 Ice House Street, Central, Hong Kong, and, in the case of holders of H Shares, to the Company's H share registrar, being Computershare Hong Kong Investor Services Limited located at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong, as soon as practicable and in any event no later than 24 hours before the time appointed for the holding of the AGM.

Completion and return of the proxy form will not preclude you from attending and voting in person at the AGM or any adjourned meetings thereof should you so wish.

This circular will be published on the Stock Exchange's website at www.hkexnews.hk and on the Company's website at www.cmbec.com.hk.

*  For identification purpose only

19 April 2021

CONTENTS

	Page
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3
Notice of Annual General Meeting . . . . . . . . . . . . . . . . . . . . . . . .	7

DEFINITIONS

In this circular, unless the context requires otherwise, the following expressions have the meanings as set out below:

"AGM"	the annual general meeting of the Company to be held on
	Tuesday, 18 May 2021 at 10:30 a.m. at Room 54, 5/F, New Henry
	House, 10 Ice House Street, Central, Hong Kong, notice of which
	is set out on pages 7 to 10 of this circular
"Board"	the board of the Directors
"Company"	常茂生物化學工程股份有限公司 (Changmao Biochemical
	Engineering Company Limited*), a joint stock limited company
	incorporated in the PRC with the H Shares currently listed on the
	Stock Exchange (stock code: 954)
"Director(s)"	the director(s) of the Company
"Domestic Share(s)"	ordinary share(s) with a par value of RMB0.10 each in the capital
	of the Company which is(are) subscribed for in RMB by PRC
	citizens and/or entities
"Foreign Share(s)"	ordinary share(s) with a par value of RMB0.10 each in the capital
	of the Company which is(are) subscribed for in a currency other
	than RMB by non-PRC citizens and/or entities
"Group"	the Company and its subsidiaries
"H Share(s)"	ordinary share(s) in the capital of the Company which is(are)
	subscribed for and traded in HK$ and listed on the Stock Exchange
"Hong Kong"	the Hong Kong Special Administrative Region of the PRC
"Latest Practicable Date"	13 April 2021, being the latest practicable date prior to the
	printing of this circular for the purpose of ascertaining certain
	information contained herein
"Listing Rules"	the Rules Governing the Listing of Securities on the Stock Exchange
"PRC"	the People's Republic of China, for the purpose of this circular,
	excluding Hong Kong, the Macau Special Administrative Region
	of the People's Republic of China and Taiwan

*  For identification purpose only

1

	DEFINITIONS
"Share(s)"	collectively, Domestic Share(s), Foreign Share(s) and H Share(s)
"Shareholder(s)"	holder(s) of the Share(s)
"Share Issue Mandate"	a general mandate proposed to be granted to the Directors to
	exercise the powers of the Company to allot, issue and deal with
	the Domestic Shares, Foreign Shares and H Shares with an
	aggregate nominal amount of up to but not exceeding 20% of the
	aggregate nominal amount of each of the Domestic Shares,
	Foreign Shares and/or H Shares respectively in issue as at the
	date of passing of the proposed special resolution
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"HK$"	Hong Kong dollars, the lawful currency of Hong Kong
"RMB"	Renminbi, the lawful currency of the PRC

2

LETTER FROM THE BOARD

常 茂 生 物 化 學 工 程 股 份 有 限 公 司

Changmao Biochemical Engineering Company Limited*

(a joint stock limited company incorporated in the People's Republic of China)

(Stock Code: 954)

Executive Directors:	Head office and legal address:
Mr. Rui Xin Sheng (Chairman)	No. 1228 Chang Jiang Bei Road
Mr. Pan Chun	New North Zone
	Changzhou City
Non-executive Directors:	Jiangsu Province, 213034
Mr. Zeng Xian Biao	The PRC
Mr. Yu Xiao Ping
Ms. Leng Yi Xin	Principal place of business
Mr. Wang Jian Ping	in Hong Kong:
	Room 54, 5th Floor
Independent non-executive Directors:	New Henry House
Prof. Ouyang Ping Kai	10 Ice House Street
Ms. Wei Xin	Central
Ms. Au Fung Lan	Hong Kong
	19 April 2021
To the Shareholders
Dear Sir/Madam

GENERAL MANDATE TO ISSUE NEW SHARES

AND

NOTICE OF ANNUAL GENERAL MEETING

1. INTRODUCTION

The purpose of this circular is to provide you with the notice of the AGM and information regarding resolutions to be proposed at the AGM, including but not limited to the Share Issue Mandate.

*  For identification purpose only

3

LETTER FROM THE BOARD

2. SHARE ISSUE MANDATE

At the AGM, a special resolution will be proposed to renew the unconditional general mandate given to the Directors to issue, allot and deal with additional Domestic Shares, Foreign Shares and/or H Shares respectively thereof not exceeding 20% of the aggregate nominal amount of each of the Domestic Shares, Foreign Shares and/or H Shares in issue on the date of passing of the special resolution in relation to the Share Issue Mandate.

The Share Issue Mandate will be valid from the date of the passing of the special resolution in relation to the Share Issue Mandate until whichever is the earlier of:

1. the conclusion of the next annual general meeting of the Company; or
2. the expiration of the period within which the next annual general meeting of the Company is required by the articles of association of the Company or by law to be held; or
3. the date on which the powers granted by the special resolution in relation to the Share Issue Mandate is revoked or varied by a special resolution of the Company in general meeting.

As at the Latest Practicable Date, there were in issue in aggregate of 2,500,000 Domestic Shares, 343,500,000 Foreign Shares and 183,700,000 H Shares. Assuming no additional Domestic Shares, Foreign Shares and/or H Shares will be allotted or issued and no existing Domestic Shares, Foreign Shares and/or H Shares are repurchased by the Company after the Latest Practicable Date but prior to the date of the AGM, if the Share Issue Mandate is fully exercised, the Company will be authorized to issue an additional of 500,000 Domestic Shares, 68,700,000 Foreign Shares and 36,740,000 H Shares respectively. The Directors wish to state that they have no immediate plans to issue any new Shares pursuant to the Share Issue Mandate. The Directors believe that it is in the best interests of the Company and the Shareholders to have a general authority from the Shareholders to enable the Directors to issue Shares at such time as the Directors think fit without the need to convene a general meeting to approve issue of Shares.

3. PROPOSED FINAL DIVIDEND

As stated in the final results announcement of the Company for the year ended 31 December 2020 dated 30 March 2021, the Directors recommend the payment of a final dividend of RMB0.020 (inclusive of tax) per share in cash, totalling approximately RMB10,594,000 for the year ended 31 December 2020. The proposed dividend is subject to approval by the Shareholders at the AGM. It is intended that the dividend will be payable on 30 July 2021 to the holders of Domestic Shares, Foreign Shares and H Shares whose names appear on the register of member of the Company at 4:30 p.m. on 31 May 2021.

The H Share register of shareholders of the Company will be closed from 26 May 2021 to 31 May 2021 (both days inclusive), during which no transfer of H Shares will be effected. In order to qualify for the final dividend, all transfers, accompanied by the relevant share certificates, must be lodged with the Company's H Share registrar, Computershare Hong Kong Investor Services Limited, at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong not later than 4:30 p.m. on 25 May 2021.

4

LETTER FROM THE BOARD

4. RESIGNATION OF SUPERVISORS

Reference is made to the announcement issued by the Company dated 15 June 2020 in relation to the resignation of Prof. Jiang Yao Zhong and Mr. Lu A Xing as supervisors of the Company which was effective from 30 June 2020. The Administration for Industry and Commerce of the PRC has requested the Company to pass a resolution in the forthcoming general meeting to approve, ratify and confirm the resignation of Prof. Jiang Yao Zhong and Mr. Lu A Xing in order to register such change. Accordingly, an ordinary resolution will be proposed at the AGM.

5. AGM

The AGM will be convened for the purpose of considering and, if thought fit, passing the ordinary resolutions relating to the ordinary businesses of the Company, and the special resolution in relation to Share Issue Mandate.

Notices convening the AGM to be held at 10:30 a.m. on Tuesday, 18 May 2021 at Room 54, 5/F, New Henry House, 10 Ice House Street, Central, Hong Kong are set out on pages 7 to 10 of this circular.

Proxy form for use at the AGM are enclosed and are also published on the websites of the Stock Exchange (www.hkexnews.hk) and the Company (www.cmbec.com.hk).

Whether or not you are able to attend the AGM, you are advised to complete the enclosed proxy form in accordance with the instructions printed thereon and return it, in the case of holders of Domestic Shares and Foreign Shares, to the principal place of business of the Company in Hong Kong at Room 54, 5th Floor, New Henry House, 10 Ice House Street, Central, Hong Kong, and, in the case of holders of H Shares, to the Company's H share registrar, being Computershare Hong Kong Investor Services Limited located at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong, as soon as practicable and in any event no later than 24 hours before the time appointed for the holding of the AGM.

Completion and return of the proxy form will not preclude you from attending and voting in person at the AGM or any adjourned meetings thereof should you so wish.

6. VOTING BY POLL

Pursuant to rule 13.39(4) of the Listing Rules, all votes at the AGM will be taken by poll and the Company will announce the results of the poll in the manner prescribed under rule 13.39(5) of the Listing Rules.

5

LETTER FROM THE BOARD

7. CLOSURE OF REGISTER OF MEMBERS

Holders of H Shares are advised that the register of members of the Company will close from 11 May 2021 to 18 May 2021 (both days inclusive), during which time no transfer of H Shares will be effected and registered. Shareholders whose names appear on the register of members of the Company at the close of business on 10 May 2021 are entitled to attend the AGM. In order to qualify for attendance at the AGM, instruments of transfer accompanied by share certificates and other appropriate documents must be lodged with the Company's share registrar and transfer office for H shares, Computershare Hong Kong Investor Services Limited, by 4:30 p.m. on 10 May 2021.

8. RECOMMENDATIONS

The Board considers that the Share Issue Mandate and all other resolutions set out in the notice of AGM are all in the best interest of the Company and its Shareholders as a whole. Accordingly, the Directors recommend that you vote in favour of all the resolutions set out in the notice of AGM.

By order of the Board

Changmao Biochemical Engineering Company Limited*

Rui Xin Sheng

Chairman

• For identification purpose only

6

NOTICE OF ANNUAL GENERAL MEETING

常 茂 生 物 化 學 工 程 股 份 有 限 公 司

Changmao Biochemical Engineering Company Limited*

(a joint stock limited company incorporated in the People's Republic of China)

(Stock Code: 954)

NOTICE IS HEREBY GIVEN that the annual general meeting ("AGM") of Changmao Biochemical Engineering Company Limited ("Company") will be held at 10:30 a.m. on Tuesday, 18 May 2021 at Room 54, 5/F, New Henry House, 10 Ice House Street, Central, Hong Kong for the following purposes:

As ordinary resolutions:

1. To receive the audited consolidated financial statements of the Company, together with the report of the Directors, the report of the Supervisory Committee and the international independent auditor's report for the year ended 31 December 2020;
2. To consider and approve the final dividend distribution proposal for the year ended 31 December 2020;
3. To consider and approve, ratify and confirm the resignation of Prof. Jiang Yao Zhong and Mr. Lu A Xing as the supervisors of the Company with effect from 30 June 2020;
4. To consider the re-appointment of PricewaterhouseCoopers as the international auditor of the Company and PricewaterhouseCoopers Zhong Tian LLP as the domestic auditor of the Company; and to authorise the Board to fix their remunerations;
5. To transact any other business.

As special resolution:

1. To consider granting a general mandate to the Board to exercise the right to allot and issue new shares of the Company:

"THAT:

1. subject to the limitations imposed by (c) and (d) below and in accordance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited ("Listing Rules"), the Company Law of the People's Republic of China ("PRC"), and other applicable laws and regulations (in each case as amended from time to time), a general unconditional mandate be and is hereby granted to the board of directors to exercise once or more during the "Relevant Period" (as defined below) all the powers of the Company to allot and issue new shares on such terms and conditions the board of directors may determine and that, in the exercise of their powers to allot and issue shares, the authority of the board of directors shall include (without limitation):
2. 1. the determination of the class and number of the shares to be allotted;

*  For identification purpose only

7

NOTICE OF ANNUAL GENERAL MEETING

1. 1. the determination of the issue price of the new shares;
   2. the determination of the opening and closing dates of the issue of new shares;
   3. the determination of the class and number of new shares (if any) to be issued to the existing shareholders;
   4. to make or grant offers, agreements and options which might require the exercise of such powers; and
   5. in the case of an offer or issue of shares to the shareholders of the Company, excluding shareholders who are residents outside the PRC or the Hong Kong Special Administrative Region, on account of prohibitions or requirements under overseas laws or regulations or for some other reasons which the board of directors consider expedient;
2. upon the exercise of the powers granted under paragraph (a), the board of directors of the Company may during the "Relevant Period" make or grant offers, agreements and options which might require the shares relating to the exercise of the authority there under being allotted and issued after the expiry of the "Relevant Period";
3. the aggregate amount of the Domestic Shares, Foreign Shares and/or overseas listed foreign shares ("H Shares") to be allotted or conditionally or unconditionally agreed to be allotted (whether pursuant to the exercise of options or otherwise) by the board of directors of the Company pursuant to the authority granted under paragraph (a) above (excluding any shares which may be allotted upon the conversion of the common reserve（公積金）into capital in accordance with the Company Law of the PRC or the Articles of Association of the Company) shall not exceed twenty per cent (20%) of the amount of the Domestic Shares, Foreign Shares and/or H Shares of the Company separately in issue as at the date of passing of this Resolution;
4. the board of directors of the Company in exercising the powers granted under paragraph (a) above shall (i) comply with the Company Law of the PRC, other applicable laws and regulations of the PRC, and the Listing Rules (in each case, as amended from time to time) and (ii) be subject to the approvals of the China Securities Regulatory Commission and relevant authorities of the PRC (if any);
5. for the purposes of this Resolution: "Relevant Period" means the period from the date of the passing of this Resolution until whichever is the earlier of:
6. 1. the conclusion of the next annual general meeting of the Company; or
   2. the expiration of the period within which the next annual general meeting of the Company is required by the articles of association of the Company or by law to be held; or
   3. the date on which the powers granted by this Resolution is revoked or varied by a special resolution of the Company in general meeting;

8

NOTICE OF ANNUAL GENERAL MEETING

1. the board of directors shall, subject to the relevant approvals of the relevant authorities and the exercise of the power granted under paragraph (a) above in accordance with the Company Law and other applicable laws and regulations of the PRC, increase the Company's registered capital corresponding to the relevant number of shares allotted upon the exercise of the powers granted under paragraph (a) of this Resolution, provided that the registered capital of the Company shall not exceed 120% of the amount of registered capital of the Company as at the date of passing of this Resolution;
2. the board of directors be and they are hereby authorised to amend, as they may deem appropriate and necessary, relevant articles of the Articles of Association of the Company to reflect the change in the share capital structure of the Company in the event of an exercise of the powers granted under paragraph (a) to allot and issue new shares."

By order of the Board

Rui Xin Sheng

Chairman

The PRC, 19 April 2021

Notes:

1. Holders of H Shares are advised that the register of members of the Company will close from 11 May 2021 to 18 May 2021 (both days inclusive), during which time no transfer of H Shares will be effected and registered. Shareholders whose names appear on the register of members of the Company at the close of business on 10 May 2021 are entitled to attend the AGM. In order to qualify for attendance at the AGM, instruments of transfer accompanied by share certificates and other appropriate documents must be lodged with the Company's share registrar and transfer office for H shares, Computershare Hong Kong Investor Services Limited, by 4:30 p.m. on 10 May 2021.
2. Every shareholder who has the right to attend and vote at the AGM is entitled to appoint one or more proxies, whether or not they are shareholders of the Company, to attend and vote on his behalf at the AGM.
3. A proxy shall be appointed by an instrument in writing. Such instrument shall be signed by the appointer or his attorney duly authorised in writing. If the appointer is a legal person, then the instrument shall be signed under a legal person's seal or signed by its director or an attorney duly authorised in writing. The instrument appointing the proxy shall be deposited, in the case of holders of Domestic Shares and Foreign Shares, at the Company's principal place of business in Hong Kong; in the case of holders of H Shares, at the Company's H share registrar not less than 24 hours before the time appointed for the holding of the AGM. If the instrument appointing the proxy is signed by a person authorised by the appointer, the power of attorney or other document of authority under which the instrument is signed shall be notarised. The notarised power of attorney or other document of authority shall be deposited together and at the same time with the instrument appointing the proxy, in the case of holders of Domestic Shares and Foreign Shares, at the Company's principal place of business in Hong Kong; in the case of holders of H Shares, at the Company's H share registrar.
4. The purpose of having special resolution number 1 is to grant a general power to the Board to allot and issue new shares subject to applicable laws, regulations and rules.
5. Shareholders and their proxies attending the AGM shall be responsible for their own travelling and accommodation expenses.

9

NOTICE OF ANNUAL GENERAL MEETING

1. According to the Article 63 of the Articles of Association of the Company, when the Company convenes a shareholders' annual general meeting, shareholder(s) holding 3% or more of the total shares carrying voting rights of the Company are entitled to propose new matters in writing to be considered and the Company shall include in the agenda of that meeting those matters contained in the proposal which are within the scope of the duties of the general meeting provided that the proposal is delivered to the Company 10 working days prior to the date of the AGM.
2. The address of Computershare Hong Kong Investor Services Limited is:
   17M Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong Tel No.: (852) 2862 8555
   Fax No.: (852) 2865 0990
   The address of the Company's principal place of business in Hong Kong is: Room 54, 5th Floor, New Henry House, 10 Ice House Street, Central, Hong Kong Tel No.: (852) 2525 2242
   Fax No.: (852) 2525 6994
3. If tropical cyclone warning signal no. 8 or above, "extreme conditions" caused by super typhoons or a black rainstorm warning is in effect at any time after 7:00 am on the AGM date, the meeting will be postponed and further announcement for details of alternative meeting arrangements will be made. The meeting will be held as scheduled even when tropical cyclone warning signal no. 3 or below is hoisted, or an amber or red rainstorm warning signal is in force. You should make your own decision as to whether you would attend the meeting under bad weather conditions and if you should choose to do so, you are advised to exercise care and caution.
4. Taking into account of the recent development of the epidemic caused by novel coronavirus pneumonia (COVID-19), Shareholders are strongly encouraged not to attend the AGM in person and to vote by way of proxy instead. The Company will implement the following prevention and control measures at the AGM against the epidemic to protect the Shareholders from the risk of infection:
5. • Compulsory body temperature check and health declarations will be conducted for every member or proxy at the entrance of the venue. Any person with a body temperature of over 37.5 degrees Celsius will not be admitted to the venue;
   • Every Shareholder or proxy is required to wear surgical facial mask throughout the meeting; and
   • No distribution of corporate gifts and no refreshments will be served.

Furthermore, the Company wishes to advise the members, particularly the members who are subject to quarantine in relation to COVID-19, that they may appoint any person or the chairman of the meeting as a proxy to vote on the resolutions, instead of attending the meeting in person.

10