Shenzhen Cotran New Material Co.Ltd(300731)
Shareholder dividend return planning for the next three years (20222024)
In order to further clarify and improve the company’s dividend return mechanism, enhance the transparency and operability of profit distribution decisions, and effectively protect the legitimate rights and interests of minority shareholders, according to the company law of the people’s Republic of China and the notice on further implementing matters related to cash dividends of listed companies (zjf [2012] No. 37) Regulatory guidelines for listed companies No. 3 – cash dividends of listed companies (revised in 2022) (CSRC announcement [2022] No. 3), notice on encouraging merger and reorganization, cash dividends and share repurchase of listed companies (zjf [2015] No. 61) and other relevant laws, regulations and normative documents, as well as the provisions of Shenzhen Cotran New Material Co.Ltd(300731) articles of Association (hereinafter referred to as the “articles of association”), The plan for shareholders’ dividend return of Shenzhen Cotran New Material Co.Ltd(300731) in the next three years (20222024) is hereby formulated. The details are as follows:
1、 Considerations for the formulation of the company’s dividend return plan
The company will implement a sustained and stable profit distribution policy, pay attention to the reasonable return on investment to investors, take into account the sustainable development of the company, and establish a sustained and stable return mechanism to investors in combination with the company’s profitability and the actual needs of the business’s future development strategy. The board of directors, the board of supervisors and the general meeting of shareholders shall fully consider the opinions of independent directors, supervisors and public investors in the decision-making and demonstration of profit distribution policies. 2、 The company’s shareholder dividend plan for the next three years (20222024)
1. Profit distribution principle: the company implements a sustainable and stable profit distribution policy. The company should pay attention to the reasonable investment return to investors for profit distribution, and take into account the actual operation and sustainable development of the company in that year. 2. Form of profit distribution: the company may distribute profits in cash or stock, or a combination of cash and stock, or other ways permitted by laws and regulations. The profit distribution shall not exceed the scope of accumulated distributable profits and shall not damage the company’s sustainable operation ability. On the premise of meeting the capital demand, predictable major investment plan or major cash expenditure, the board of directors of the company can make interim dividends according to the current operating profit and cash flow of the company. The specific plan must be reviewed by the board of directors and submitted to the general meeting of shareholders for approval. Under the conditions of cash dividend, the company shall give priority to cash dividend for profit distribution.
3. If the company intends to implement cash dividends, it shall meet the following conditions at the same time:
(1) The company is profitable in the current year and the accumulated undistributed profit is positive;
(2) The audit institution shall issue a standard unqualified audit report on the company’s annual financial report.
Under the condition of meeting the above cash dividend conditions, the company shall distribute profits in cash.
4. Cash dividend ratio: the company shall maintain the continuity and stability of the profit distribution policy, and the profit distributed in cash every year shall not be less than 20% of the distributable profit realized by the company in that year. The board of directors of the company shall comprehensively consider the industry characteristics, development stage, its own business model, profitability and whether there are major capital expenditure arrangements, distinguish the following situations, and put forward differentiated cash dividend policies in accordance with the procedures specified in the articles of association:
(1) If the development stage of the company is mature and there is no major capital expenditure arrangement, the proportion of cash dividends in this profit distribution shall reach 80% at least;
(2) If the development stage of the company is mature and there are major capital expenditure arrangements, the proportion of cash dividends in this profit distribution shall reach 40% at least;
(3) If the development stage of the company is in the growth stage and there are major capital expenditure arrangements, when making profit distribution, the proportion of cash dividends in this profit distribution shall be at least 20%.
If the development stage of the company is not easy to distinguish, but there are major capital expenditure arrangements, it shall be handled in accordance with the provisions of the preceding paragraph.
Major capital expenditure arrangement refers to that the cumulative expenditure of the company’s planned foreign investment, acquisition of assets or purchase of equipment, land and other fixed assets in the next 12 months reaches more than 30% of the company’s latest audited total assets, except for project investment with raised funds.
If the company’s performance grows rapidly and the board of Directors considers that the company’s stock price does not match the size of the company’s share capital, it can propose and implement a stock dividend distribution plan while meeting the above cash distribution. When formulating the specific proportion of profit distribution by shares, the board of directors of the company shall fully consider whether the total share capital after profit distribution by shares is commensurate with the current business scale and profit growth rate of the company, and consider the impact on the future debt financing cost, so as to ensure that the profit distribution plan is in line with the overall interests of all shareholders.
5. If a shareholder occupies the company’s funds in violation of regulations, the company shall deduct the cash dividends distributed by the shareholder in order to repay the funds occupied.
3、 The company shall perform the following decision-making procedures for profit distribution
1. The company’s annual profit distribution plan shall be proposed and drafted by the board of directors in combination with the provisions of the articles of association, profitability and capital needs, and submitted to the general meeting of shareholders for deliberation after being reviewed and approved by the board of directors and approved by more than half of the independent directors. The shareholders’ meeting shall review the profit distribution plan and the board of supervisors shall issue written opinions on it.
2. When the board of Directors considers the specific plan of cash dividend, it shall carefully study and demonstrate the timing, conditions and minimum proportion of the company’s cash dividend, adjustment conditions and decision-making procedures, and the independent directors shall express clear opinions; Independent directors can solicit the opinions of minority shareholders, put forward dividend proposals and directly submit them to the board of directors for deliberation.
3. When the general meeting of shareholders deliberates on the specific scheme of cash dividends, it shall actively communicate and exchange with shareholders, especially minority shareholders, through various channels (including but not limited to providing online voting, inviting minority shareholders to attend the meeting, etc.), fully listen to the opinions and demands of minority shareholders, and timely respond to the concerns of minority shareholders.
4. If the board of directors does not propose a profit distribution plan in cash when the conditions for cash dividends are met in the current year, the reasons shall also be explained and disclosed in the annual report, and the independent directors shall express independent opinions on this. At the same time, when convening the general meeting of shareholders, the company shall provide online voting and other means to facilitate minority shareholders to participate in the voting of the general meeting of shareholders.
5. The board of supervisors shall supervise the implementation of the company’s profit distribution policy and shareholder return plan and decision-making procedures by the board of directors and management, and issue special instructions and opinions on the implementation of relevant policies and plans if it makes profits within the year but does not put forward a profit distribution plan.
6. The general meeting of shareholders shall vote on the profit distribution plan proposed by the board of directors in accordance with laws, regulations and the articles of association.
4、 Adjustment of profit distribution policy
If the company needs to adjust the profit distribution policy according to the needs of production and operation, the adjusted profit distribution policy shall not violate the relevant provisions of the CSRC and the stock exchange. The proposal on adjusting the profit distribution policy shall seek the opinions of the independent directors and the board of supervisors in advance, and shall be submitted to the general meeting of shareholders for approval after being deliberated and approved by the board of directors of the company, and shall be approved by more than 2 / 3 of the voting rights held by the shareholders attending the general meeting of shareholders.
In order to fully consider the opinions of public investors, the general meeting of shareholders shall be held by online voting at the same time.
5、 Formulation cycle of shareholder dividend return plan in the next three years
1. The company shall review the dividend return plan for shareholders in the next three years at least once every three years, fully listen to and consider the opinions of shareholders (especially minority shareholders), independent directors and supervisors, and make appropriate and necessary modifications to the dividend distribution policy being implemented by the company to determine the dividend return plan for this period.
2. The company’s shareholder dividend return plan for the next three years shall be reviewed and approved by the board of directors, reviewed and expressed by independent directors, reviewed and put forward by the board of supervisors, and then submitted to the general meeting of shareholders for deliberation and approval. The board of directors shall be responsible for interpretation.
3. When formulating the shareholder return plan, the company shall actively communicate with shareholders, especially minority shareholders, through various channels, including but not limited to telephone, fax, email, investor reception day, etc.
6、 Information disclosure
The company shall disclose in detail the formulation and implementation of the cash dividend policy in the annual report, and make special explanations on the following matters:
1. Whether it complies with the provisions of the articles of association or the requirements of the resolutions of the general meeting of shareholders;
2. Whether the dividend standard and proportion are clear and clear;
3. Whether the relevant decision-making procedures and mechanisms are complete;
4. Whether the independent directors have performed their duties and played their due role;
5. Whether minority shareholders have the opportunity to fully express their opinions and demands, and whether the legitimate rights and interests of minority shareholders have been fully protected.
If the cash dividend policy is adjusted or changed, it shall also specify whether the conditions and procedures of adjustment or change are compliant and transparent.
7、 Effectiveness of shareholder dividend return plan
The plan shall come into force from the date of deliberation and approval by the general meeting of shareholders of the company, and the same shall apply when it is revised.
Shenzhen Cotran New Material Co.Ltd(300731) board of directors
April 9, 2002
