Plan for shareholder returns over the next three years (2022-2024)


1. Principle of profit distribution

Based on the principle of attaching importance to reasonable investment returns to investors, while taking into account the company's capital needs and sustainable development, the company has established a continuous, stable and scientific return mechanism for investors to maintain the continuity and stability of the profit distribution policy. At the same time, we pay attention to the balance between the requirements and wishes of shareholders and the company's capital needs and sustainable development. When formulating a specific dividend plan, the cost of funds from various external financing sources and the company's cash flow should be taken into account to determine a reasonable cash dividend ratio and reduce the company's financial risk.

2, the form of profit distribution.

The company may distribute dividends in cash, a combination of cash and stock, or other ways permitted by laws and regulations. Subject to the conditions for cash dividends, the company shall give priority to cash dividends for profit distribution.

3. Conditions and proportion of cash dividends

In the case that the company's annual profit available for distribution to shareholders (I. e. the company's after-tax profit after making up for losses and withdrawing provident fund) is positive, and the audit institution issues a standard unqualified audit report on the company's annual financial report, the company shall pay cash dividends; if the company has no major investment plan or major cash expenditure, the profits distributed in cash in a single year shall not be less than 15% of the distributable profits realized in the current year, and the accumulated profits distributed in cash in the last three years shall not be less than 30% of the annual distributable profits realized in the three years.

The Board of Directors of the Company shall, taking into account the characteristics of the industry in which it operates, the stage of development, its own business model, the level of profitability and whether there are any significant capital expenditure arrangements, distinguish between the following circumstances and propose a differentiated cash dividend plan for the annual profit distribution:

(1) If the company's development stage is mature and there is no significant capital expenditure arrangement, the proportion of cash dividends in this profit distribution shall be at least 80%;

(2) If the company's development stage is mature and there are significant capital expenditure arrangements, the cash dividend will be 40% of the profit distribution;

(3) If the company's development stage is a growth stage and there are significant capital expenditure arrangements, or if the company's development stage is not easy to distinguish but there are significant capital expenditure arrangements, the proportion of cash dividends in this profit distribution shall be at least 20%.

A significant investment plan or significant cash outlay is:

(1) The company's proposed foreign investment, acquisition of assets or purchase of equipment in the next twelve months shall meet or exceed 50% of the company's latest audited net assets;

(2) The Company intends to make foreign investments, acquire assets or purchase equipment in the next twelve months with a cumulative expenditure of 30% or more of the Company's latest audited total assets.

4. Conditions for the distribution of stock dividends

When considering the company's growth and capital needs, and the board of directors believes that the payment of stock dividends is in the overall interests of all shareholders of the company, it may propose a stock dividend distribution plan. The use of stock dividends for profit distribution shall have real and reasonable factors such as the growth of the company and the dilution of net assets per share.

5. Period intervals for profit distribution

When the company makes a profit in the current year and has a profit available for distribution, it shall make an annual profit distribution. In principle, a cash dividend will be paid after the approval of the annual general meeting of shareholders. The Board of Directors of the Company may propose an interim cash dividend for the Company under special circumstances.

6. Procedures for consideration of profit distribution

(1) When the company formulates a specific plan for cash dividends, the board of directors shall carefully study and demonstrate the timing, conditions and minimum proportion of the company's cash dividends, the conditions for adjustment and the requirements of its decision-making procedures, and the independent directors shall express clear opinions.

(2) The annual profit distribution plan of the company shall be proposed and formulated by the board of directors of the company in combination with the provisions of the articles of association and the financial operation of the company, and shall be submitted to the general meeting of shareholders for approval after being approved by more than half of all directors. Independent directors should express clear independent opinions on the profit distribution plan.

(3) Before the general meeting of shareholders deliberates on the specific cash dividend plan, it shall actively communicate and communicate with shareholders, especially small and medium shareholders, through various channels, fully listen to the opinions and demands of small and medium shareholders, and promptly answer the concerns of small and medium shareholders.

(4) If the company is profitable for the year and meets the conditions for cash dividends, but the board of directors fails to submit a profit distribution plan to the general meeting of shareholders in accordance with the established profit distribution policy, it shall explain the reasons, the purpose of the funds not used for dividends retained in the company and the expected earnings in the interim report, and the independent directors shall express their independent opinions.

(5) The Supervisory Board shall supervise the implementation of the Company's profit distribution policy and shareholder return planning by the Board of Directors and management and the decision-making process. The Supervisory Board shall review the profit distribution plan.

7, the adjustment mechanism of profit distribution policy.

The company's profit distribution policy shall not be changed at will. If there are major changes in the external business environment or its own business conditions and it is necessary to modify the company's profit distribution policy, the company's board of directors shall formulate the draft profit distribution policy to be revised ex officio. The independent directors of the company shall express their independent opinions on the draft profit distribution policy to be revised, which shall be approved by more than 2/3 of the voting rights held by shareholders attending the general meeting. The Board of Supervisors of the Company shall review the profit distribution policy formulated and amended by the Board of Directors and shall be approved by a vote of more than half of the Supervisors. The adjusted profit distribution policy shall not violate the relevant provisions of the CSRC and the stock exchange.

When the general meeting of shareholders considers the proposal to adjust the profit distribution policy, it should fully listen to the opinions of the public shareholders. In addition to setting up on-site meetings to vote, it should also provide shareholders with an online voting system to support it.

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