Nacity Property Service Group Co.Ltd(603506)
Shareholder dividend return planning for the next three years (20222024)
In order to further clarify the shareholder return mechanism of the company from 2022 to 2024 and effectively protect the legitimate rights and interests of small and medium-sized shareholders, according to the notice on matters related to the further implementation of cash dividends of listed companies, the guidelines for the supervision of listed companies No. 3 – cash dividends of listed companies (revised in 2022) and other relevant provisions of the CSRC, and in combination with the articles of association, The company has formulated the shareholder dividend return plan for the next three years (20222024), the main contents of which are as follows:
(I) principle of profit distribution
The profit distribution of the company shall pay attention to the reasonable return on investment to the public shareholders, take sustainable development and safeguarding the shareholders’ rights and interests as the purpose, maintain the continuity and stability of the profit distribution policy, and comply with the relevant provisions of laws and regulations. The profit distribution of the company shall not exceed the scope of accumulated distributable profits and shall not damage the sustainable operation ability of the company.
(II) method of profit distribution
The company distributes dividends in cash or a combination of cash and stocks, with priority given to cash dividends. If the conditions for cash dividends are met, cash dividends can be used for profit distribution. The use of stock dividends for profit distribution should be combined with the real and reasonable factors such as the growth of the company and the dilution of net assets per share. The profit distribution of the company shall not exceed the accumulated profit range available for distribution by shareholders, and shall not damage the company’s sustainable operation ability.
(III) conditions and proportion of dividends
Dividends can be distributed when the following conditions are met:
1. In addition to the company’s major investment plans or major cash expenditure arrangements, the company shall give priority to cash distribution of dividends when the company’s distributable profits (i.e. the company’s after tax profits after making up losses and withdrawing provident fund) in the current year or half year are positive, the cumulative distributable profits are positive, and meet the capital needs of the company’s normal production and operation. The profit distributed by the company in cash every year shall not be less than 10% of the distributable profit realized in the current year. Major investment plan or major cash expenditure arrangement refers to that the cumulative expenditure of the company on the purchase of assets, foreign investment, fixed asset investment and other transactions in the next 12 months reaches or exceeds 10% of the company’s latest audited net assets. The specific dividend proportion of each year shall be proposed by the board of directors according to the company’s annual profit status and future fund use plan.
2. When the company is in good operating condition and the board of Directors considers that the company’s earnings per share and stock price do not match the size and structure of the company’s share capital, the company can distribute profits by issuing stock dividends on the premise of meeting the above cash dividend ratio. When determining the specific amount of profit distributed by shares, the company shall fully consider whether the total share capital after profit distribution by shares is compatible with the company’s current business scale and profit growth rate, 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 and long-term interests of all shareholders.
3. 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%;
(4) If the development stage of the company is not easy to distinguish, but there are major capital expenditure arrangements, it can be handled in accordance with the provisions of the preceding paragraph. Under the condition of meeting the dividend conditions, the company will pay cash dividends once a year in principle. The board of directors of the company may propose the company to pay interim dividends according to the current profit scale, cash flow status, development stage and capital demand.
(V) conditions for stock dividend distribution
When the company is operating well and the board of Directors believes that the distribution of stock dividends is conducive to the overall interests of all shareholders of the company, it can put forward a stock dividend distribution plan on the premise of ensuring full cash dividend distribution. Where stock dividends are used for profit distribution, real and reasonable factors such as the growth of the company and the dilution of net assets per share shall be combined.
(VI) decision making procedures and mechanisms
The annual profit distribution plan of the company shall be proposed and drafted by the board of directors in combination with the provisions of the articles of association, profitability, capital supply and demand. The independent directors shall express independent opinions on the profit distribution plan, which shall be submitted to the general meeting of shareholders for deliberation and approval after being reviewed and approved by the board of directors. Independent directors can solicit the opinions of minority shareholders, put forward dividend proposals and directly submit them to the board of directors for deliberation.
When the general meeting of shareholders deliberates the profit distribution plan, the company shall provide shareholders with online voting methods, actively communicate and exchange with shareholders, especially minority shareholders, through various channels, fully listen to the opinions and demands of minority shareholders, and timely respond to the concerns of minority shareholders.
If the company is profitable in the current 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 and use plan of the funds not used for dividends retained in the company in the periodic report, and the independent directors shall give independent opinions.
(VII) change of the company’s profit distribution policy
The company shall formulate or adjust the dividend return plan and plan according to its own actual situation and in combination with the opinions of shareholders (especially public investors) and independent directors. However, the company shall ensure that the current and future dividend return plans and plans shall not violate the following principles: that is, when the company makes profits in the current year and meets the conditions of cash dividend, the company shall distribute dividends in cash, and the profits distributed in cash shall not be less than 20% of the profits distributed at that time.
If the profit distribution policy needs to be adjusted due to major changes in the external business environment or their own business conditions, the reasons shall be demonstrated and explained in detail in the proposal of the general meeting of shareholders based on the protection of shareholders’ rights and interests; 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 be submitted to the general meeting of shareholders for approval after being deliberated and approved by the board of directors and the board of supervisors. Independent directors shall express independent opinions on the proposal. When the general meeting of shareholders deliberates the proposal, online voting and other means shall be used to provide voting conditions for public shareholders to attend the meeting. The adjustment plan of profit distribution policy shall be approved by more than 2 / 3 of the voting rights held by the shareholders attending the general meeting of shareholders.
Major changes in the company’s external business environment or its own business conditions refer to one of the following situations: 1. The company’s operating losses due to major changes in national laws, regulations and industrial policies that have a significant adverse impact on the company’s production and operation;
2. The occurrence of war, natural disasters and other force majeure factors has a significant adverse impact on the company’s production and operation, resulting in the company’s operating losses;
3. Due to significant changes in the external business environment or its own operating conditions, the ratio of net cash flow generated by the company’s operating activities to net profit in three consecutive fiscal years is less than 20%;
4. Other matters prescribed by the CSRC and the stock exchange.
(VIII) if a shareholder illegally occupies the company’s funds, the company shall deduct the cash dividend distributed by the shareholder to repay the funds occupied.
(IX) formulation cycle and adjustment mechanism of shareholder dividend return plan
1. The company shall formulate the shareholder return plan in a three-year cycle. On the basis of summarizing the implementation of the shareholder return plan in the previous three years, the company shall fully consider the factors faced by the company and the opinions of shareholders (especially minority shareholders), independent directors and supervisors to determine whether it is necessary to adjust the company’s profit distribution policy and the shareholder return plan for the next three years.
2. In case of force majeure such as war and natural disasters, or major changes in the company’s external business environment and have a significant impact on the company’s production and operation, or major changes in the company’s own business conditions, or the current specific shareholder return plan affects the company’s sustainable operation, the company may adjust the shareholder return plan according to the basic principles of profit distribution determined in this article, Reformulate the shareholder return plan.
Nacity Property Service Group Co.Ltd(603506) board of directors April 15, 2022
