Shenda Shares ((600626): Shareholders' Return Plan In 2021-2023

Shenda Co., Ltd.: 2021-2023 annual shareholder return plan of Shanghai Shenda Co., Ltd

(approved by the first extraordinary general meeting of shareholders in 2021 on March 8, 2021)

In order to improve and improve the company's scientific, sustainable and stable dividend mechanism, actively repay investors, and guide investors to establish long-term investment and rational investment concept, according to the notice of China Securities Regulatory Commission on further implementing matters related to cash dividends of listed companies (zjf [2012] No. 37) and No. 3 supervision guidelines of listed companies - cash dividends of listed companies (China Securities Regulatory Commission) The board of directors of the listed company has formulated the shareholders' return plan for the next three years (2021-2023) of Shanghai Shenda Co., Ltd. (hereinafter referred to as "the plan") in accordance with the requirements of the company's announcement [2013] No. 43) and the relevant provisions of the articles of Association, and comprehensively considering the factors such as the company's development strategic planning, industry development trend, shareholder return, social capital cost and external financing environment The contents are as follows:

(1) considerations for formulating the plan

The company formulates this plan, focusing on the long-term and sustainable development of the company, comprehensively considering the company's actual operation situation, development objectives, shareholders' requirements and wishes, and establishing a sustainable, stable and scientific return planning and mechanism for shareholders, so as to make a systematic arrangement for the profit distribution, so as to ensure the continuity and stability of the profit distribution policy.

(2) principles for formulating the plan

Under the premise of complying with the relevant national laws and regulations and the relevant profit distribution of the articles of association, the plan should attach great importance to the reasonable investment return of investors and firmly establish the consciousness of returning to shareholders. The company implements a sustainable and stable profit distribution policy and takes into account the sustainable development of the company. In the process of decision-making and demonstration of profit distribution policy, the board of directors and the general meeting of shareholders actively communicate and exchange with independent directors and small and medium shareholders, and fully listen to the opinions of independent directors and small and medium shareholders.

(3) return planning of shareholders in the next three years (2021-2023)

1. When the company makes profits in an accounting year and the accumulated undistributed profit is greater than zero (the parent company reports that

Table data), including cash dividends, stock dividends, stock repurchase and other ways of profit distribution. If the company has the conditions for cash dividends, it shall give priority to cash dividends for profit distribution, and the distribution proportion of all cash dividends (including tax) in the current year shall be 30% of the company's net profit attributable to the shareholders of the listed company in that year. On this basis, additional cash dividends can also be paid to shareholders with the approval of the general meeting of shareholders if the conditions such as profit growth and disposable cash increase are met, or when the board of Directors considers it feasible.

2. When the company adopts stock dividend for profit distribution, it should give reasonable cash dividend return to shareholders and maintain the appropriate scale of capital stock, and comprehensively consider the real and reasonable factors such as the growth of the company and the dilution of net assets per share, so as to ensure that the distribution scheme conforms to the overall interests of all shareholders.

3. When the company formulates the specific plan of cash dividends, the board of directors shall carefully study and demonstrate the timing, conditions and minimum proportion of cash dividends, adjustment conditions and decision-making procedure requirements of the company. Independent directors shall express clear opinions and solicit the opinions of small and medium-sized shareholders, and put forward dividend proposals to the board of directors for deliberation.

Before the shareholders' meeting deliberates on the specific cash dividend plan, it should actively communicate and exchange with shareholders, especially small and medium-sized shareholders, through various channels, fully listen to the opinions and demands of small and medium-sized shareholders, and timely reply to the concerns of small and medium-sized shareholders.

4. Distribution cycle: in principle, the company will distribute profits by year, and can distribute interim profits and special profits.

5. In case of illegal occupation of company funds by shareholders, the company shall deduct the cash dividends distributed by the shareholders to repay the funds occupied.

6. If the company repurchases its shares by way of offer or centralized bidding with cash as consideration, it shall be deemed as cash dividend of listed company, and shall be included in relevant proportion of cash dividend.

(4) decision making mechanism and procedures for profit distribution

1. The board of directors shall, in accordance with the principles determined in the above paragraphs, and the characteristics of the industry, development stage, business model, profitability, capital demand, return plan for shareholders, and whether there are major capital expenditure arrangements, the board of directors shall put forward dividend proposals and formulate profit sub formula.

2. The dividend proposal and profit distribution plan made by the board of directors shall be submitted to the general meeting of shareholders for deliberation. If the company is unable to determine the current year's profit distribution plan according to the above cash dividend policy or the minimum cash dividend ratio under special circumstances, the specific reasons and the explicit opinions of independent directors shall be disclosed in the annual report; at the same time, the annual profit distribution plan shall be approved by more than two thirds of the voting rights of the shareholders attending the general meeting of shareholders.

When the company's external business environment or its own business situation changes significantly, or the existing profit distribution policy affects the sustainable operation of the company, the board of directors of the company can submit a detailed plan for adjusting or changing the profit distribution policy to the general meeting of shareholders for deliberation and decision. The independent directors of the company shall express their independent opinions on the adjustment or change of the profit distribution policy; the proposal for the adjustment or change of the profit distribution policy shall be passed by more than two thirds of the voting rights held by the shareholders attending the general meeting of shareholders.

3. After the general meeting of shareholders makes a resolution on the profit distribution plan, the board of directors of the company shall complete the distribution of dividends (or shares) within 2 months after the general meeting of shareholders is held.

5. Interpretation and effectiveness

1. This plan shall come into effect as of the date of deliberation and approval by the general meeting of shareholders of the company.

2. The board of directors of the company is responsible for the interpretation of the plan.

3. Matters not covered in this plan shall be implemented in accordance with relevant laws and regulations, normative documents and articles of association.

Board of directors of Shanghai Shenda Co., Ltd

March 8, 2021