REG - SDIC Power Holdings - Notice of the 2023 Annual General Meeting
29/05/2024 12:00
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RNS Number : 2632Q SDIC Power Holdings Co., LTD 29 May 2024
SDIC Power Holdings CO., LTD.
(GDR under the symbol: "SDIC")
NOTICE OF THE 2023 ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN that the 2023 Annual General Meeting of SDIC Power
Holdings CO., LTD. will be held at Room 207, No.147 Xizhimen Nanxiao Street,
Xicheng District, Beijing, the PRC, on Wednesday, 19 June 2024 at 14:00 p.m.,
for the purpose of considering, and if thought fit, passing the following
resolution.
ORDINARY RESOLUTION
1. To consider and approve the 2023 Work Report of the Board of Directors
2. To consider and approve the 2023 Work Report of the Supervisory Committee
3. To consider and approve the Report on Final Accounts of the Company for
2023
4. To consider and approve the Proposal on 2024 Operation Plan
5. To consider and approve the Proposal on 2023 Profit Distribution Plan
SPECIAL RESOLUTION
6. To consider and approve the Proposal on Amending the Articles of
Association
7. To consider and approve the Proposal on Amending the Rules of Procedure of
the General Meeting of Shareholders
8. To consider and approve the Proposal on Amending the Rules of Procedure of
the Board of Directors
ORDINARY RESOLUTION
9. To consider and approve the Proposal on Amending the Working System of
Independent Directors
The Board of Directors of SDIC Power Holdings CO., LTD.
May 29, 2024
The resolutions hereunder contain the English translation of the Chinese
version of "Meeting materials for the 2023 Annual General Meeting" as
published on the website of the Shanghai Stock Exchange, and are provided for
your reference only. In case of discrepancy between the Chinese version and
the English version, the Chinese version shall prevail.
Proposal I
SDIC Power Holdings Co., Ltd.
2023 Work Report of the Board of Directors
Dear shareholders and shareholder representatives,
In the year 2023, facing new development trends and new industry pattern of
the power sector, the Board of Directors of SDIC Power Holdings Co., Ltd.
(hereinafter referred to as "SDIC Power" or "the Company") seized the
opportunity to pursue progress while maintaining stability and promote
stability through progress, focused on enhancing core functions and core
competitiveness, overcame difficulties and worked hard. We hit a new high in
our primary business results, saw reports of fresh success in business
development and significant improvements in governance efficiency, and
effectively safeguarded the legitimate rights and interests of our
shareholders.
The work of the Board of Directors in 2023 and the work plan for 2024 are
hereby reported as follows:
Part I Work of the Board of Directors in 2023
I. Operating Achievements of the Company
The operating indicators of the Company continued to improve. By the end of
2023, the holding installed capacity was 40.8566 million kW; the total assets
were RMB 277.363 billion, an increase of RMB 19.064 billion over the end of
the previous period; and the asset-liability ratio was 63.18%, a decrease of
0.59 percentage points from the previous year.
There were no work safety accidents throughout 2023. The new installed
capacity put into operation in this year totaled 3.0924 million kW, with a
completed power generation of 161.973 billion kWh, up 3.35% year on year; the
on-grid tariff was RMB 0.374/kWh, up 6.55% year on year. The annual operating
revenue was RMB 56.712 billion, a year-on-year increase of 12.32%; the net
profit attributable to shareholders of the Company was RMB 6.705 billion, a
year-on-year increase of 64.31%; and the basic earnings per share was RMB
0.8754, a year-on-year increase of 67.86%.
II. Convening of Board Meetings
According to the relevant provisions of laws and regulations, as well as the
Articles of Association and the Rules of Procedure of the Board of Directors,
the Company held a total of 16 board meetings and deliberated 63 proposals in
2023, including the appointment of senior executives, system revision,
related-party transactions, and other matters, ensuring the efficient and
smooth operation of our business activities. All directors of the Company
attended all the board meetings during the year and no absence occurred. The
matters deliberated are as follows:
(I) Personnel changes
In 2023, Mr. Zhang Wenping, director and general manager, and Mr. Yang Lin,
secretary of the Board of Directors, resigned from their positions due to a
job adjustment. According to the relevant provisions of the Company Law and
the Articles of Association, the Board of Directors of the Company efficiently
carried out the selection and appointment of directors and senior executives.
In April 2023, according to the nomination by the Company's chairman, the
Board of Directors agreed to appoint Mr. Yu Haimiao as the general manager.
According to the nomination by the controlling shareholder of the Company,
State Development & Investment Corp., Ltd. and with the approval by the
third extraordinary general meeting of shareholders in 2023 through
deliberation, Mr. Yu Haimiao was elected as a member of the Twelfth Board of
Directors of the Company.
In July 2023, according to the nomination by the Company's general manager,
the Board of Directors agreed to appoint Mr. Cai Jidong and Mr. Jing Zhentao
as the deputy general managers of the Company.
In October 2023, according to the nomination by the Company's general manager,
the Board of Directors agreed to appoint Mr. Gao Hai as the deputy general
manager and secretary of the Board of Directors of the Company, and to appoint
Mr. Zhou Changxin as the chief accountant (financial director) of the Company.
(II) System revision
In 2023, according to relevant requirements of the Administrative Measures for
Compliance of Central Enterprises and other regulations, the Board of
Directors agreed to revise the Articles of Association by adding compliance
management functions of the Board of Directors and the Management, defining
the positioning of senior executives including the general counsel and chief
accountant (financial director), with the approval by the first extraordinary
general meeting of shareholders in 2023 through deliberation.
In addition, in accordance with relevant requirements of the Administrative
Measures for Compliance of Central Enterprises, the Notice on Issuing the
Opinions on Further Strengthening the Development of Central Enterprises under
the Rule of Law, and the Guidelines on Investor Relations Management of Listed
Companies issued by the China Securities Regulatory Commission, the Guidelines
No. 1 of Shanghai Stock Exchange for Self-regulation of Listed Companies -
Standardized Operation, etc., the Board of Directors presided over the
revision of six systems, including the Administrative Measures for
Remuneration of Persons-in-Charge, the Administrative Measures for Compliance,
the Administrative Measures for Investor Relations, the Administrative
Measures for Labor Costs, the Measures for Implementation of the
"Three-Important and One-Large" Decision System, and the Administrative
Measures for Investment Dividends, to further standardize the Company's
operations and strengthen the compliance management, thus ensuring the stable
development of the Company.
(III) Related-party transactions
As required by the needs of business development, the Board of Directors
agreed the Company to sign a Financial Service Agreement with SDIC Finance
Co., Ltd. and Rongshi International Treasury Management Co., Ltd.
respectively, for a term of three years with the approval by the second
extraordinary general meeting of shareholders in 2023 through deliberation. In
December 2023, the Board of Directors deliberated and approved the estimates
of daily related-party transactions for 2024.
(IV) Performance assessment and signing of performance contracts
According to the Administrative Measures for Performance Assessment of Senior
Executives of the Company, the Board of Directors carried out the signing of
performance contracts and employment contracts for senior executives in 2023.
(V) Guarantees
To implement the Company's international strategic planning and ensure the
smooth progress of project construction, the Board of Directors deliberated
and approved the guarantee provided by the parent company for Inch Cape
Offshore Limited with a total amount of not exceeding GBP 25 million, with the
approval by the fourth extraordinary general meeting of shareholders in 2023
through deliberation.
(VI) Periodic reports
The Board of Directors deliberated and approved the 2022 Annual Report and its
summary, 2023 First-Quarter, Semi-annual and Third-quarter Reports of the
Company to ensure true, accurate and complete disclosure of the Company's
financial condition and operating results to the market.
(VII) Internal control
The Board of Directors deliberated and approved the 2022 Internal Control
Evaluation Report of the Company, 2022 Enterprise-wide Risk Management Report
of the Company, Internal Control Manual (2023 Edition) and Internal Control
Standard Business Process (2023 Edition), and 2022 Internal Audit Work Report
of the Company, all of which were prepared in accordance with regulatory
requirements of the Guidelines No. 1 of Shanghai Stock Exchange for
Self-regulation of Listed Companies - Standardized Operation and the Company's
rules and regulations.
(VIII) Profit distribution
The Board of Directors deliberated and approved the profit distribution
matters for the year 2022, and proposed to the general meeting of shareholders
that the profit distribution in 2022 should be based on the total share
capital of 7,454,179,797 shares, and a cash dividend (including tax) of RMB
0.275 per share should be distributed, with a dividend ratio of 50%. It
strictly followed the commitments in the Shareholder Return Plan for the Next
Three Years (2021-2023) and was recognized by the majority of shareholders.
(IX) Changes to accounting policies
According to the Accounting Standards for Business Enterprises No. 16 issued
by the Ministry of Finance on November 30, 2022, the Board of Directors
deliberated and approved changes to accounting policies based on the actual
conditions of the Company.
(X) Changes to the accounting firm
According to the relevant provisions of the Notice on Issuing the
Administrative Measures for Selection and Appointment of Accounting Firms by
State-owned Enterprises and Listed Companies, to ensure the independence and
objectivity of audit work, the Board of Directors deliberated and approved the
appointment of BDO China Shu Lun Pan CPAs (Special General Partnership) for
the audit of financial statements and internal control of the Company for the
year 2023, with the approval by the 7th extraordinary general meeting of
shareholders in 2023 through deliberation.
III. Main Works Done during the Reporting Period
(I) Abiding by the rules strictly and performing duties diligently
In 2023, the Board of Directors proposed 8 general meetings of shareholders,
including 1 annual General Meeting of Shareholders and 7 Extraordinary General
Meetings of Shareholders, all of which were held by combining on-site voting
with online voting. The proposals of all previous General Meetings of
Shareholders were highly recognized by the majority of shareholders and
successfully passed the vote.
In 2023, the professional committees of the Board of Directors held a total of
21 meetings, including 2 meetings for the Strategy Committee, 5 meetings for
the Nomination Committee, 6 meetings for the Remuneration and Assessment
Committee and 8 meetings for the Audit Committee. The Strategy Committee was
deeply involved in the formulation of the Company's 2023 Operating Plan. The
Company completed the interim revision of the "14th Five-Year Plan" Strategic
Planning Report. The Strategy Committee evaluated the optimization and
adjustments by the Company to the "14th Five-Year Plan" strategic planning to
better guide the Company's development in the latter half of the "14th
Five-Year Plan", and provided suggestions for the Board of Directors to
formulate strategies and make scientific decisions. The Audit Committee
actively maintained close communication with internal and external audit
institutions, and paid attention to the necessity, fairness and pricing
fairness of related-party transactions, as well as changes to accounting
policies and the accounting firm. The Remuneration and Assessment Committee
reviewed the remuneration situation and assessment performance results, and
revised the Administrative Measures for Remuneration of Persons-in-Charge, the
Administrative Measures for Labor Costs and other systems. The Nomination
Committee strictly followed the nomination procedure and successfully
completed the election of directors as well as the appointment of the general
manager and senior executives of the Company.
In 2023, the independent directors gave full play to their respective
professional advantages in the power industry, legal compliance, and
accounting auditing, and conducted prior deliberations or expressed
independent opinions on 19 matters or proposals such as related-party
transactions, external guarantees, nomination, appointment and removal of
directors, and changes in accounting policies. They were diligent and
responsible, paid close attention to the Company's business dynamics, and put
forward professional opinions and suggestions promptly. Within the year, they
conducted two surveys on the Company, visited Fujian and Hainan for on-site
inspections, understood the operating situation of the Company's controlling
investment enterprises, and conducted in-depth exchanges and discussions on
industry development. Meanwhile, they regularly communicated with the
management of the Company according to work needs and actively safeguarded
shareholders' rights and interests.
(II) Strengthening strategic guidance and adhering to high-quality development
In 2023, we achieved robust operating performance, continuously improved the
sound output capacity of units, and optimized the hydropower cascade
dispatching. We also strengthened fuel supply, focused on work safety
management, and continuously enhanced the supply capacity. We completed the
supply guarantee during important periods such as the Two Sessions and peak
load in summer and winter, contributing to people's livelihood electricity and
grid security and promoting economic and social development in many places. We
fully exerted our core functions and fulfilled our corporate social
responsibilities.
With the grid connection and power generation of major projects, we made many
achievements in incremental development. With the solar power projects in
Rinbung County and Nyima County put into operation, we achieved a breakthrough
of zero installed capacity of new energy in Tibet, the roof of the world. The
Kela Solar Power Station Phase I, the world's largest and highest hydro-solar
hybrid power station, was completed in the Yalong River Basin. We overcame
various challenges of Qinzhou Second Power, realized grid connection power
generation of Unit 1 in Phase III on schedule, and achieved the planning goals
of Guangxi Zhuang Autonomous Region. Many domestic new energy projects were
approved or filed and the installed capacity maintained a rapid growth
throughout the year. In terms of overseas projects, the Underground Diversion
Tunnel of Batang Toru Hydropower Station was fully completed and the overall
progress of the project is controllable and under control.
(III) Strengthening risk management and control and consolidating compliance
management
Promoting the governance system through systems, we have formed a compliance
management system with comprehensive coverage and clear responsibilities. We
have amended our Measures for Implementing the Decision-making System of
"Three-important and One-major" Matters, further standardizing the
decision-making authority and process of governance entities in the Company.
We have set up the system management framework for overseas enterprises,
implemented the key areas of overseas control and domestic and foreign
regulatory requirements, and systematically standardized the approval levels
for subsidiaries' policies.
Strictly adhering to the bottom line against compliance risks, we establish a
solid foundation for high-quality development. Clearly defining key management
elements and bottom-line requirements, we have amended the Operation
Compliance Management Manual for Enterprise Directors of SDIC Power,
established a general contract template library for the Company, and conducted
compliance and effectiveness evaluations in the fields of investment, mergers,
acquisitions, and anti-monopoly. In addition, we fully realized the mid-term
task indicators and key compliance management tasks of the "14th Five-Year
Plan" for the rule of law, further optimizing our compliance management
system. Focusing on controlling compliance risks in new energy projects, we
conduct special training for new energy enterprises and communicate compliance
requirements to prevent potential issues.
(IV) Actively optimizing governance and delivering corporate values
The Company strictly fulfilled the information disclosure obligation of listed
companies and protected the right to know of investors. The Company
continuously disclosed 62 Chinese announcements and 32 English announcements
through the Shanghai Stock Exchange and London Stock Exchange throughout the
year. With zero errors, zero supplements, and zero inquiries in terms of
information disclosure, the Company has been awarded the "Grade A Rating of
Information Disclosure" by the Shanghai Stock Exchange for seven consecutive
years, establishing an image of robust, standardized, professional, and
responsible player in the capital market.
The Board of Directors attached great importance to investor relationship
management and constantly summarized the experience of interacting with
investors through multiple channels. first, the Board of Directors established
and improved various investor relationship management systems, laying a solid
foundation for the construction of the organizational structure of investor
relationship work. second, the Board of Directors delivered values and
optimized efficient interaction mechanisms for investors across multiple
levels. Within the year, it prepared and organized three online performance
briefings and two offline performance briefings, with over 300 investors
actively participating. It convened high-quality performance briefings to
engage in in-depth exchanges with investors and conducted 84 investor
exchanges, with 1,122 investor receipts throughout the year. Thirdly, it
continued to attach great importance to the protection of the rights and
interests of minority shareholders, obtained suggestions from the capital
market, and presented investors with a corporate image with clear strategies,
effective management, and excellent performance.
Part II Work Plan of the Board of Directors in 2024
The year 2024 is a key year for achieving the Company's "14th Five-Year Plan"
goals and a crucial year for implementing the action plan to deepen the reform
of state-owned enterprises and the special action to improve the quality of
listed companies of controlled subsidiaries of central enterprises. The Board
of Directors will remain committed to fostering robust operations through
continuous improvement, balancing high-quality development with superior
safety standards, fulfilling energy supply responsibilities, driving green
transformation initiatives, accelerating market capability building, and
elevating our high-quality development to new heights. The main work plan is
as follows:
I. Uniting Efforts for Development and Focusing on Enhancing Core Functions
Enhancing core functions and highlighting value creation. In the face of the
complex and ever-changing external background in the power industry, coupled
with multiple influencing factors, the Board of Directors will adhere to the
coordination between stock efficiency improvement and incremental development.
It is committed to accelerating the transition towards clean and low-carbon
energy, serving the building of a new development landscape, comprehensively
enhancing our value creation capabilities, elevating our high-quality
development to new heights, and striving to reward our shareholders.
The energy industry is developing rapidly. With the rapid growth of energy
demand in China, ensuring a safe and reliable power supply is an important
core function of state-owned power enterprises. The development of a new power
system has entered an important stage of accelerated promotion, and the
competition in green transition has become more diverse. With the deepening of
the reform of the power market and the continuous promotion of technological
changes to adjust and upgrade the industrial structure, power enterprises
shall seize the opportunity to take the initiative in pursuing change,
actively adapting to changes, and creating new quality productive forces.
To keep up with the development trend of the power industry and firmly grasp
the initiative of development, the Board of Directors will take on the task of
energy supply with higher standards, promote the green and low-carbon
transition with more determined steps, adapt to the trend of power
marketization with more proactive actions, and enhance technological
innovation capabilities with greater efforts.
II. Implementing the Green Transition Strategy and Accelerating Clean and
Low-Carbon Development
Staying confident in the path of green transition, the Board of Directors will
fully follow the national strategy of "Dual Carbon" goals, accelerate towards
a clean and low-carbon development path, and continuously promote the
development of new energy businesses.
The Board of Directors will follow the requirements of strategic control,
revise the Company's "14th Five-Year Plan" for development during the interim,
and further clarify the target for the installed capacity of new energy.
Moreover, the Board of Directors will control the overall trend of energy and
continue to make breakthroughs in business expansion. In the construction of
the Yalong River Clean Energy Base, the Board of Directors will unremittingly
promote the acquisition of new energy resources in the river basin, adhere to
systematic thinking, and combine power transmission channel resources with
local consumption capacity to steadily promote rolling development in the
Yalong River Basin and persistently improve overall benefits. It will promote
the development of new energy businesses based on the basic principles of
benefit priority and regional coordination and actively strive for more
resources.
The Board of Directors will take multiple measures and make unremitting
efforts to strive for new energy projects, promote breakthroughs in multiple
projects, actively achieve expected development reserve targets, and
contribute to green development. In terms of infrastructure construction and
production, it will arrange the progress reasonably and urge the early
completion, early output, and early contribution of the installed capacity.
III. Ensuring Energy Security and Strengthening the Drive for Technological
Innovation
Doing the utmost to ensure energy supply, the Board of Directors will enhance
technological innovation capabilities to adapt to market trends, uphold the
bottom line of work safety, and fulfill the social responsibilities of a
central enterprise.
In China's current economic backdrop, the characteristic of higher growth in
power load than power consumption has become increasingly apparent. To ensure
a safe and reliable power supply, the Board of Directors will well manage work
safety, solidly carry out the three-year action plan for fundamental work
safety improvement, and promote system enhancement and infrastructure safety
management. Moreover, the Board of Directors will achieve "four in place" in
terms of standards, responsibilities, execution, and assessment, and ensure
sound work safety. The Board of Directors will reinforce the implementation of
responsibilities, equipment management, fuel supply, hydropower dispatching,
and emergency security, and enhance power supply security capabilities through
the "five reinforcements".
Technological innovation constantly promotes the adjustment and upgrading of
the industrial structure, and the application of new technologies can
significantly reduce the cost of power equipment. The Board of Directors will
enhance technological innovation capabilities, increase resource investment,
and encourage enterprises to solve key issues, make breakthroughs in key
technologies, and promote the application of results. It will vigorously
promote the application of new technologies, research and tackle technical
difficulties in projects under construction, and accelerate the cultivation
and development of new quality productive forces.
IV. Optimizing Internal Management and Steadily Improving Operation Efficiency
Operating existing assets well and exerting their due benefits is an important
manifestation of the core competitiveness of the power business. The Board of
Directors will focus on hydropower operation and management, stabilize thermal
power performance, and accelerate the standardization and intensification of
the management of new energy businesses. By promoting specialized
construction, the Board of Directors will optimize management methods,
consolidate the foundation for sustainable development, establish the core
competitiveness of operation and management, and make greater contributions to
performance.
The Board of Directors will continuously strengthen marketing efficiency, form
a market-oriented mindset, and improve the professional and standardized
management level of marketing. It will make good use of national policies and
formulate flexible marketing strategies. Moreover, it will increase market
development efforts and continuously strengthen communication and reporting
with competent government authorities and trading institutions.
Guided by ensuring the promotion of the Company's key work, the Board of
Directors will leverage the supporting role of human resources, continuously
improve management effectiveness, and better match and support strategic
implementation. It will explore and optimize incentive mechanisms under new
situations to stimulate endogenous driving forces for high-quality
development. It will continue to play the "baton" role of performance
assessment, focus on performance contribution and value creation, constantly
optimize the performance assessment system, unblock the transmission mechanism
of responsibility pressure around the Company's key difficulties, strengthen
the rigid fulfillment of assessments, and encourage attention to practical
results and take the initiative to tackle difficulties and promote the
effective implementation of work.
V. Promoting Value Delivery and Improving the Quality of Listed Companies
The Board of Directors will solidly carry out special work to improve the
quality of listed companies, optimize the platform landscape, promote its
functional performance, and facilitate improved governance and standardized
operations. Furthermore, it will strengthen endogenous growth and innovative
development, enhance market recognition and value realization, and ensure that
the high-quality development of listed companies will be elevated to new
heights.
The Board of Directors will establish a multi-level value delivery mechanism,
continuously execute regulatory requirements from all parties, and solidly
enhance corporate governance. It will strengthen investor relationship
management, actively maintain good relations with investors, enhance the
Company's image in the capital market, and build a comprehensive and
multi-level value transmission work system. Adhering to the concept of
sustainable development, it will establish a high-standard ESG "1+N"
management system that is in line with the Company's reality and has the
characteristics of SDIC Power, work together with stakeholders, and jointly
create a green future.
In 2023, the work of the Company's Board of Directors proceeded smoothly under
the support of shareholders. Focusing on the positioning of "the pioneer of
clean energy and the leader in industry investment" and adhering to the core
pursuit of "Brighten Nature, Brighter Power", the Company actively assumes
environmental and social responsibility, actively accelerates participation in
the construction of a new power system, and implements the national "Dual
Carbon" strategy. The year 2024 marks the 75th anniversary of the founding of
the People's Republic of China. Standing at a new historical starting point,
the Board of Directors will continue to advance reforms, understand new
characteristics and trends, embrace responsibilities, forge ahead, aim to
become a globally-trusted investor & operator in integrated energy, and
strive to write a new chapter of high-quality development.
The above proposal has been deliberated and approved at the 27th Meeting of
the Twelfth Board of Directors on April 29, 2024, and it is hereby presented
to you for deliberation and approval.
Proposal II
SDIC Power Holdings Co., Ltd.
2023 Work Report of the Supervisory Committee
Dear shareholders and shareholder representatives,
In 2023, the Supervisory Committee of the Company satisfactorily fulfilled all
its work with the powers conferred by the Company Law and the Articles of
Association of SDIC Power and safeguarded the legitimate rights and interests
of the Company and all its shareholders. During the reporting period, the
Supervisory Committee fulfilled its duties and effectively supervised the
Company's legal enterprise governance, standardized financial operation,
related-party transactions, changes in accounting policies, etc. The work of
the Supervisory Committee in 2023 is reported as follows:
I. Meetings of Supervisory Committee in 2023
During the reporting period, the Supervisory Committee of the Company held a
total of seven meetings according to the provisions of the Company Law and the
Articles of Association, taking into account the Company's reality. All
meetings of the Supervisory Committee were convened and chaired by the
Chairman of the Supervisory Committee. All members of the Supervisory
Committee attended each meeting, carefully reviewed and passed various
proposals, and effectively fulfilled their duties of review and supervision.
The convening of meetings of the Supervisory Committee, the exercise of
supervisors' rights, and the resolution contents all comply with relevant
provisions of the Company Law, the Articles of Association, and the Rules of
Procedure of the Supervisory Committee.
The information on meetings of the Supervisory Committee is as follows:
Session Date Topic
The 6th Meeting of the Twelfth Supervisory Committee April 14, 2023 1. Proposal on Signing a Financial Service Agreement and Related-party
Transaction with SDIC Finance Co., Ltd.;
2. Risk Assessment Report on SDIC Finance Co., Ltd.;
3. Proposal on Formulating the Risk Disposal Plan for Handling Deposit and
Loan Business in SDIC Finance Co., Ltd.;
4. Proposal on Signing a Financial Service Agreement and Related-party
Transaction with Rongshi International Treasury Management Co., Ltd.;
5. Risk Assessment Report on Rongshi International Treasury Management Co.,
Ltd.;
6. Proposal on Formulating the Risk Disposal Plan for Handling Deposit and
Loan Business in Rongshi International Treasury Management Co., Ltd.;
The 7th Meeting of the Twelfth Supervisory Committee April 27, 2023 1. 2022 Work Report of the Supervisory Committee;
2. Proposal on the Company's 2022 Annual Report and Its Summary;
3. Proposal on 2022 Profit Distribution Plan;
4. Proposal on 2022 Annual Financial Statements;
5. Proposal on Deliberation of the 2022 Annual Internal Control Evaluation
Report of the Company;
6. Proposal on Deliberation of the 2022 Annual Comprehensive Risk Management
Report of the Company;
7. Proposal on Deliberation of the 2022 Internal Audit Work Report of the
Company;
8. Continuous Risk Assessment Report on SDIC Finance Co., Ltd.;
9. Continuous Risk Assessment Report on Rongshi International Treasury
Management Co., Ltd.;
10. Special Report on the 2022 Annual Deposit and Use of Raised Funds;
11. Report on the First Quarter of 2023.
The 8th Meeting of the Twelfth Supervisory Committee June 28, 2023 Proposal on Changes in Accounting Policies
The 9th Meeting of the Twelfth Supervisory Committee August 28, 2023 1. Continuous Risk Assessment Report on SDIC Finance Co., Ltd.;
2. Continuous Risk Assessment Report on Rongshi International Treasury
Management Co., Ltd.;
3. Special Report on the Deposit and Actual Use of Raised Funds for the Half
Year of 2023;
4. Semiannual Report of 2023.
The 10th Meeting of the Twelfth Supervisory Committee October 27, 2023 Report on the Third Quarter of 2023
The 11th Meeting of the Twelfth Supervisory Committee December 5, 2023 Proposal on the Change of Accounting Firm
The 12th Meeting of the Twelfth Supervisory Committee December 28, 2023 Proposal on 2024 Estimated Daily Related-Party Transactions
II. Opinions of the Supervisory Committee on Relevant Matters in 2023
(I) Legal operation of the Company
In 2023, each supervisor inspected and supervised the Company's production and
operation, financial status, decision-making on important matters, and other
matters related to the interests of minority shareholders with a rigorous and
prudent working attitude. The Supervisory Committee attended the meetings of
the Board of Directors as a non-voting member and reviewed all the proposals
of the Board of Directors. The Supervisory Committee believes that the
decision-making procedures of the Board of Directors of the Company are legal,
and finds no director or managerial force performs any acts that may harm the
interests of shareholders of the Company while performing their duties, nor
any other behavior that violates laws and regulations.
(II) Inspection of the Company's financial status
In 2023, the Supervisory Committee kept abreast of the Company's operation and
financial situation, and reviewed documents submitted by the Board of
Directors, including quarterly, semi-annual, and annual financial reports. The
Supervisory Committee believes that the preparation and review procedures for
the Company's periodic reports comply with the relevant provisions of laws,
regulations, and the Articles of Association; the contents and formats of the
Company's periodic reports conform to the relevant regulations of the China
Securities Regulatory Commission and the Shanghai Stock Exchange, and the
information contained therein fairly reflects the Company's financial status
and operating results during the reporting period; BDO China Shu Lun Pan CPAs
(Special General Partnership) has issued unqualified standard audit reports on
the Company's 2023 annual financial report, which is objective and fair.
(III) Related-party transactions of the Company
During the reporting period, the Supervisory Committee continuously supervised
the related-party transactions of the Company and believed that: the review
procedures for the Company's related-party transactions were legal and
effective, the principle of related-party pricing was fair, the related-party
transactions met the needs of the Company's operation and development, and
there was no damage to the interests of the Company and its shareholders,
especially minority shareholders.
(IV) Use and management of the Company's raised funds
During the reporting period, the Supervisory Committee continuously supervised
that the use and management process of raised funds complied with laws and
regulations, reviewed the special report on the storage and use of raised
funds in 2022 and a half year of 2023, checked the relevant progress of raised
investment projects, and found no damage to the rights and interests of the
Company and minority shareholders.
(V) Implementation of the internal control system and review of the evaluation
report for internal control
During the reporting period, the Supervisory Committee reviewed the annual
internal control evaluation report, understood the construction and operation
of the internal control system, and gave full play to its supervision and
guidance role. The Supervisory Committee believes that the Company has
established a relatively complete internal control system, the existing
internal control system meets the requirements of national laws and
regulations, as well as the actual needs of the Company's current business
operations, and it has been effectively implemented in the Company's business
management, playing a good role in control and prevention; the internal
control self-evaluation report of the Company can truly, completely, and
objectively reflect the reality of the Company in the aspects of internal
control, and the Supervisory Committee has no objection to the Board of
Directors' internal control evaluation report.
(VI) Changes in accounting policies
The Supervisory Committee agreed to make changes to the Company's accounting
policies according to the Accounting Standards for Business Enterprises No. 16
issued by the Ministry of Finance in 2022.
III. Outlooks
In 2024, the Supervisory Committee will continue to play its supervisory
function, be diligent, responsible, timely, and efficient, maintain close
communication with the management, ensure that the Board of Directors and the
management of the Company carry out their work in strict accordance with the
relevant provisions of the Company Law and the Articles of Association,
implement the resolutions of the General Meeting of Shareholders, and
safeguard the legitimate rights and interests of all shareholders.
In 2023, the work of the Company's Board of Directors proceeded smoothly under
the support of shareholders. Focusing on the positioning of "the pioneer of
clean energy and the leader in industry investment" and adhering to the core
pursuit of "Brighten Nature, Brighter Power", the Company actively assumes
environmental and social responsibility, actively accelerates participation in
the construction of a new power system, and implements the national "Dual
Carbon" strategy. The year 2024 marks the 75th anniversary of the founding of
the People's Republic of China. Standing at a new historical starting point,
the Board of Directors will continue to advance reforms, understand new
characteristics and trends, embrace responsibilities, forge ahead, aim to
become a globally-trusted investor & operator in integrated energy, and
strive to write a new chapter of high-quality development.
The above proposal has been deliberated and approved at the 14th Meeting of
the Twelfth Supervisory Committee on April 29, 2024, and it is hereby
presented to you for deliberation and approval.
Proposal III
SDIC Power Holdings Co., Ltd.
Report on Final Accounts of the Company for 2023
Dear shareholders and shareholders' representatives,
Based on the audit by BDO China Shu Lun Pan CPAs (Special General
Partnership), the Company achieved a total profit of RMB 14.215 billion in
2023 and the net profit attributable to the owners of the parent company of
RMB 6.705 billion. As of December 31, 2023, the total assets in the Company's
consolidated statements were RMB 277.363 billion, and the total equity
attributable to owners of the parent company was RMB 59.067 billion, with an
asset-liability ratio of 63.18%.
I. Key Financial Indicators in 2023
Unit: RMB
10,000 Currency: RMB
2023 2022 YoY (%)
Operating revenue 5,671,186.25 5,048,924.36 12.32
Net profits attributed to shareholders of listed company 670,493.70 408,067.73 64.31
Net profits attributable to the shareholders of the listed company after 658,937.85 395,141.18 66.76
deducting non-recurring gain or loss
Net cash flow from operating activities 2,126,812.26 2,196,350.17 -3.17
Net assets attributed to shareholders of the listed company 5,906,652.90 5,451,440.77 8.35
Total assets 27,736,302.11 25,829,951.84 7.38
Basic earnings per share (RMB/share) 0.8754 0.5215 67.86
Diluted earnings per share (RMB/share) 0.8754 0.5215 67.86
Basic earnings per share net of non-recurring gain or loss (RMB/share) 0.8599 0.5042 70.55
Weighted average return on equity (%) 12.78% 8.25% Increase by 4.53 percentage points
Weighted average return on equity (%) net of non-recurring gain or loss 12.55% 7.98% Increase by 4.57 percentage points
In 2023, the Company achieved annual operating revenue of RMB 56.712 billion,
a year-on-year increase of 12.32%, mainly due to the year-on-year increase in
on-grid energy and average on-grid tariff; the net profit attributable to the
owners of the parent company was RMB 6.705 billion, a year-on-year increase of
64.31%; and the earnings per share was RMB 0.8754, a year-on-year increase of
67.86%.
The specific analysis of main operating revenues and operating costs is as
follows:
In 2023, the Company achieved a main operating revenue of RMB 56.312 billion,
an increase of RMB 6.226 billion or 12.43% over 2022. There are two main
reasons: first, the thermal power sector increased and rushed for power
generation, resulting in a 14.93% year-on-year increase in on-grid energy,
leading to an increase in revenue; second, at the end of last year and in the
middle of this year, new units were put into operation, increasing the
installed capacity and a year-on-year increase in revenue.
The main business revenue of thermal power was RMB 22.874 billion, an increase
of RMB 2.647 billion over 2022. The main reason is that thermal power
enterprises actively participated in spot market transactions this year,
rushing for power generation when hydropower output was insufficient,
resulting in a year-on-year increase in power generation, leading to an
increase in revenue.
The main business revenue of hydropower was RMB 25.575 billion, an increase of
RMB 1.808 billion over 2022. There are two main reasons: first, the tariff
from Sichuan to Jiangsu rose this year; second, the Company actively
participated in market transactions this year and the settlement tariff was
high.
The main business revenue of wind power was RMB 2.879 billion, an increase of
RMB 525 million over 2022. There are two main reasons; first, Longtian Wind
Power, which was acquired by the Company at the beginning of the year, and
Hangjinqi Wind Power, Longmen Wind Power Phase III, and Beiqi Wind Power,
which were connected to the grid for power generation at the end of last year,
achieved profitability throughout the year, increasing power generation;
second, Laba Mountain Wind Power, Ninghe Wind Power Phase II, and Qinzhou
Dongyong Wind Power were put into operation this year, increasing the
installed capacity and resulting in an increase in power generation and a
year-on-year increase in revenue.
The main business revenue of solar power generation was RMB 1.676 billion, an
increase of RMB 411 million over 2022. There are two main reasons: first, the
newly installed Guazhou Solar Power Station and Pingtang Leyang Solar Power
Station last year achieved profitability throughout the year, increasing power
generation; second, this year, new solar power stations such as Kola Solar
Power Station and Naomao Lake South Solar Power Station were added, increasing
the installed capacity and resulting in a year-on-year increase in revenue.
The main business revenue of waste-to-energy generation was RMB 112 million,
down RMB 21 million over 2022, and the main reason is that the tariff of
C&G Environmental Protection (Thailand) declined this year, leading to a
decrease in tariff revenue.
The main operating revenue of other businesses was RMB 3.198 billion, an
increase over 2022. There are two reasons; first, the heating business revenue
significantly increased this year; second, the construction progress of the
Batang Toru Project was improved compared to the previous year, resulting in
an increase in revenue for the confirmed construction period.
In 2023, the main operating costs of the Company totaled RMB 36.011 billion,
an increase of RMB 1.886 billion or 5.53% over 2022, including:
The main operating cost of thermal power was RMB 20.407 billion, down RMB 221
million over 2022, due to the decrease in overall coal costs affected by the
decrease in coal prices this year.
The main operating cost of hydropower was RMB 10.191 billion, an increase of
RMB 1.057 billion over 2022, mainly due to the year-on-year increase in
depreciation expenses of the Yalong Hydro's hydropower stations in the middle
reaches were put into operation this year.
The main operating cost of wind power was RMB 1.228 billion, an increase of
RMB 234 million or 23.48% over 2022, mainly due to the increase in the
installed capacity of wind power from the addition of Ningxiang Gushanfeng and
Laba Mountain Wind Power this year and the increase of depreciation costs.
The main operating cost of solar power generation was RMB 758 million, an
increase of RMB 187 million or 32.69% over 2022, mainly due to the increase in
depreciation scale since new solar power projects such as Dachaoshan West
Phase II and Pubei Yuansheng Distributed Solar Power were added this year and
new projects put into operation at the end of last year operated throughout
the year.
The main operating cost of waste-to-energy generation was RMB 77 million,
basically the same as that of 2022.
The main operating cost of other businesses was RMB 3.35 billion, an increase
of RMB 628 million or 23.08% over 2022. There are two main reasons: first, it
was affected by the rise in heating business volume and coal costs; second,
the construction of the Batang Toru Project was promoted year-on-year and the
operating cost increased accordingly.
II. Profit Realization of the Company's Important Holding Companies in 2023
Unit: RMB 10,000 Currency: RMB
No. Company name Shareholding ratio (%) 2023 net profit
1 Yalong Hydro 52.00 865,795.90
2 SDIC Beijiang 64.00 1,049.47
3 SDIC New Energy Investment 64.89 73,786.52
4 SDIC Genting Meizhouwan 51.00 25,175.73
5 SDIC Qinzhou 61.00 94,947.57
6 Huaxia Power 56.00 13,584.66
7 SDIC Dachaoshan 50.00 58,868.94
As for the large fluctuations in the operating performance of major investment
companies, the analysis is as follows:
Unit: RMB 10,000 Currency: RMB
No. Company Net profit Increase or decrease amount Year-on-year increase/decrease Explanation of main reasons for increase or decrease
name
2023 2022
1 Yalong Hydro 865,795.90 736,061.62 129,734.28 17.63% First, Kela Solar Power Station and Laba Mountain Wind Power newly put into
operation this year have come into full play;
Second, the increase in settlement tariff this year brought about an increase
in electricity sales revenue.
2 SDIC Beijiang 1,049.47 -128,363.18 129,412.65 100.82% First, the production cost of SDIC Beijiang decreased due to the downturn in
coal prices this year;
Second, there was a year-on-year increase in power generation and operating
revenue this year.
3 SDIC Genting Meizhouwan 25,175.73 -21,834.22 47,009.95 215.30% First, the production cost of SDIC Genting Meizhouwan decreased due to the
downturn in coal prices this year;
Second, there was a year-on-year increase in power generation and operating
revenue this year.
4 SDIC New Energy Investment 73,786.52 60,662.83 13,123.70 21.63% The projects put into operation last year have come into full play throughout
the year, and new solar power and wind power projects have been put into
operation this year. The year-on-year increase in power generation has
enhanced the investment profitability of SDIC New Energy Investment.
5 SDIC Qinzhou 94,947.57 -17,421.15 112,368.72 645.01% First, this year's rush to generate power and the downturn of coal prices,
power generation business profits increased;
Second, the heating business volume increased year-on-year this year, and the
contribution of heating profit increased.
6 Huaxia Power 13,584.66 -7,196.86 20,781.51 288.76% Affected by the downturn in coal prices, the decrease in unit production costs
has led to higher profits.
7 SDIC Dachaoshan 58,868.94 66,025.52 -7,156.58 -10.84% The inflow of the Lancang River is relatively low this year, and the power
generation decreased compared with the same period last year.
III. External Investment of the Company
In 2023, the headquarters of the Company completed an external capital
investment of RMB 3.726 billion. The details are as follows:
Unit: RMB 10,000 Currency: RMB
No. Name of the invested company Investment amount in 2023
1 Yalong River Hydropower Development Co., Ltd. 104,000.00
2 SDIC New Energy Investment Co., Ltd. 35,399.69
3 SDIC Huanneng Electric Power Co., Ltd. 12,000.00
4 SDIC (Ordos) New Energy Investment Co., Ltd. 2,500.00
5 Shenyang Jingbu Photovoltaic Power Co., Ltd. 3,050.00
6 SDIC Qinzhou Second Power Co., Ltd. 27,000.00
7 SDIC (Hainan) New Energy Co., Ltd. 3,400.00
8 Pingtang Leyang New Energy Co., Ltd. 6,060.00
9 Guiding Guoneng New Energy Co., Ltd. 1,100.00
10 Yunxian Qianrun New Energy Co., Ltd. 18,146.00
11 Tianjin Baodi Huifeng New Energy Co., Ltd. 1,479.00
12 Yuanjiang County Qianrun New Energy Co., Ltd. 12,600.00
13 Huaning Qianrun New Energy Co., Ltd. 4,000.00
14 Pingyang Aoqi New Energy Co., Ltd. 1,200.00
15 SDIC Xinjiang New Energy Co., Ltd. 70,200.00
16 SDIC (Guangdong) Offshore Wind Power Development Co., Ltd. 1,530.00
17 SDIC Jilin Dunhua Pumped-Storage Co., Ltd. 4,000.00
18 SDIC Shiyan New Energy Co., Ltd. 2,045.00
19 SDIC Inner Mongolia New Energy Co., Ltd. 1,000.00
20 Kunming Dongchuan Qianrun New Energy Co., Ltd. 4,845.00
21 SDIC Shaanxi New Energy Co., Ltd. 700.00
22 Shangyi County Ruida New Energy Co., Ltd 4,550.00
23 Tianjin Binhai Guoli New Energy Co., Ltd. 1,000.00
24 Pubei Yuansheng New Energy Co., Ltd. 637.50
25 Yuxi Qianrun New Energy Co., Ltd. 1,000.00
26 Ningxiang Gushanfeng New Energy Development Co., Ltd. 17,970.00
27 Yangquan Guoli New Energy Co., Ltd. 3,595.00
28 Pubei Yuanli New Energy Co., Ltd. 9,070.00
29 SDIC Zhejiang New Energy Co., Ltd. 2,000.00
30 SDIC Tibet Renbu New Energy Co., Ltd. 9,400.00
31 SDIC Tibet Nyima New Energy Co., Ltd. 4,580.00
32 Liaoning Dalian Pumped-Storage Co., Ltd. 2,030.00
33 Jiangxi Enpu Energy Technology Co., Ltd. 57.00
34 Compton Energy (Yunnan) Co., Ltd. 500.00
Total 372,644.19
IV. Assets Impairment
In 2023, the Company incurred a total impairment loss of RMB 397,502,200
million within the scope of consolidation, including an asset impairment loss
of RMB 249,952,100 and a credit impairment loss of RMB 147,550,100.
The main provision for impairment is as follows:
Unit: RMB 10,000 Currency: RMB
Impairment item Amount
Asset impairment loss - equity impairment of Jaderock Investment in Banten 20,021.28
project
Credit impairment loss - expected credit loss on accounts receivable 15,067.35
V. Guarantee
Unit: RMB 10,000 Currency: RMB
No. Guarantor Guaranteed party Guarantee method Actual guaranteed amount New guaranteed amount this year
1 SDIC Power Holdings Co., Ltd. PT North Sumatera Hydro Energy Guarantee 241,024.28 241,024.28
2 SDIC Power Holdings Co., Ltd. Inch Cape Offshore Limited Guarantee 25,821.85 958.83
3 SDIC Power Holdings Co., Ltd. Benbrack Wind Farm Limited Guarantee 23,716.07 -
4 Red Rock Power Limited Benbrack Wind Farm Limited Guarantee 711.38 -
5 Afton Wind Farm (Holdings) Limited, Afton Wind Farm (BMO) Afton Wind Farm Limited Pledge 50,972.67
Limited
6 Xiamen Xinyuan Energy Environmental Technology Co., Ltd. Newsky (Bangkok) Environment & Technology Co., Ltd. Guarantee 5,971.70
7 Xiamen Xinyuan Energy Environmental Technology Co., Ltd. C&G Environmental Protection (Thailand) Co., Ltd. Guarantee 8,068.22
- Total guarantee 356,286.17 241,983.11
VI. Cash Flow
Unit: RMB 10,000 Currency: RMB
Item 2023 2022 Year-on-year increase/decrease (%) Reasons for increases or decreases
I. Cash flows from operating activities
1. Cash inflows from operating activities 5,832,412.17 5,673,017.75 2.81 This year's power generation increased year-on-year, resulting in a
year-on-year increase in the cash flow of power sales revenue.
2. Cash outflows from operating activities 3,705,599.91 3,476,667.59 6.58 First, the power generation of thermal power enterprises increased this year
and coal procurement increased;
Second, Yalong Hydro increased its payment for reservoir management this year.
3. Net cash flow from operating activities 2,126,812.26 2,196,350.17 -3.17
II. Cash flows from investing activities
1. Cash inflows from investing activities 51,033.40 74,476.67 -31.48 The dividends received from shareholding enterprises this year decreased on a
year-on-year basis, and the cash received from disinvestment decreased.
2. Cash outflows from investing activities 2,116,659.02 1,643,358.72 28.80 Cash payments increased for the acquisition of fixed assets, intangible
assets, and other long-term assets when new projects commenced this year.
3. Net cash flow from investing activities -2,065,625.62 -1,568,882.06 -31.66
III. Cash flows from financing activities
1. Cash inflows from financing activities 4,552,476.69 5,137,520.50 -11.39 This year, the income from electricity charges increased and corporate loans
decreased on a year-on-year basis.
2. Cash outflows from financing activities 4,646,387.87 5,494,942.06 -15.44 The loans repaid by enterprises in the current year decreased on a
year-on-year basis.
3. Net cash flow from financing activities -93,911.18 -357,421.56 73.73
IV. Net increase in cash and cash equivalents -28,955.81 272,644.01 -110.62
The above proposal has been deliberated and approved at the 27th Meeting of
the Twelfth Board of Directors on April 29, 2024, and it is hereby presented
to you for deliberation and approval.
Proposal IV
SDIC Power Holdings Co., Ltd.
Proposal on 2024 Operation Plan
Dear shareholders and shareholder representatives,
The year 2024 marks a key year to fully implement the spirit of the 20th CPC
National Congress and a crucial year for implementing the "14th Five-Year
Plan". In 2024, China's economy is expected to continue its recovery trend,
supported by the reinforcement and effectiveness improvement of China's macro
policies, accelerated cultivation of new growth drivers, accelerated release
of reform dividends, accelerated manifestation of the benefits of opening up,
and a faster replenishment of the output gap. This will underpin the robust
growth of China's economy, with an estimated GDP growth rate of about 5%.
Regarding the power market, according to the forecast of the China Electricity
Council, total electricity consumption across society in 2024 is expected to
reach 9.8 trillion kWh, representing an increase of about 6% over 2023.
Additionally, it is estimated that the newly commissioned installed capacity
of power generation in 2024 will exceed 300 million kW again, and the
cumulative installed capacity of new energy power generation will surpass the
installed capacity of coal-fired power generation for the first time.
Regarding the coal market, taking into account the trends of the coal market
in 2023 and changes in coal demand, it is estimated that the coal supply and
demand in 2024 may be slightly relaxed, with the market supply and demand
remaining broadly balanced. Overall, energy demand is expected to grow
steadily, and coal supply and demand will remain balanced. However, due to
factors such as resource conditions, regional differences, hydropower and new
energy development, and climate change, structural and seasonal tensions in
coal supply will persist. As such, continued attention will be paid to factors
such as the trends of international imported coal, domestic raw coal
production, and port inventories.
In the face of complex internal and external environments, the Company will
strengthen forward-looking analysis, innovate development models, continuously
improve value creation capabilities, enhance core competitiveness, build a
solid bottom line for risk prevention and control, constantly promote
high-quality development, and create better returns on investment for
shareholders.
The main business plans for 2024 are as follows:
I. Power Generation Plan
In 2024, it is estimated that SDIC Power will complete 178.6 billion kWh of
power generation within the scope of consolidation. Among them, the power
generation capacity of various power sources of the Company is listed below:
Unit: 100 million kWh
Item Power generation budget
Consolidation 1,786
Thermal power 600
Hydropower 1,042
Wind power 79
Solar power 65
II. Headquarters' Cost Plan
In 2024, the planned annual expenditure of SDIC Power Headquarters is RMB 590
million, including taxes and surcharges of RMB 1 million, administration
expenses of RMB 290 million, and financial expenses of RMB 300 million.
III. Annual Investment Expenditure Plan
In 2024, SDIC Power plans to invest RMB 6.41 billion in equity and RMB 34.65
billion in capital construction, mainly used for the development of hydropower
and new energy projects.
IV. Annual Financing Plan
In 2024, SDIC Power Headquarters plans to raise a total of RMB 21 billion in
annual domestic financing, which is planned to be met by public issuance of
corporate bonds medium-term notes, or renewable bonds, or through loans from
financial institutions such as SDIC Finance Co., Ltd. and banks.
SDIC Power and its overseas wholly-owned subsidiaries plan to raise a total
amount of RMB 3.85 billion in foreign currencies equivalent, which is planned
to be solved through loans from Rongshi International Holding Co., Ltd., its
subsidiaries, and financial institutions.
In order to ensure the smooth business development of the Company, the SDIC
Power Headquarters intends to apply for a total credit line of no more than
RMB 35 billion from financial institutions, including but not limited to
loans, letters of guarantee, letters of credit, and other comprehensive credit
business.
The above proposal has been deliberated and approved at the 27th Meeting of
the Twelfth Board of Directors on April 29, 2024, and it is hereby presented
to you for deliberation and approval.
Proposal V
SDIC Power Holdings Co., Ltd.
Proposal on 2023 Profit Distribution Plan
Dear shareholders and shareholders' representatives,
SDIC Power Holdings Co., Ltd. (hereinafter referred to as "the Company") was
audited by BDO China Shu Lun Pan CPAs (Special General Partnership). According
to the audit, the net profit attributable to the owner of the parent company
in the 2023 annual consolidated statement of the Company is RMB
6,704,936,953.85, and the net profit achieved in the statement of the parent
company is RMB 3,621,346,814.36. According to the provisions set out in the
Articles of Association and Shareholder Return Plan for the Next Three Years
(2021-2023), the 2023 annual profit distribution plan is proposed as follows:
I. Distributable Profits
In accordance with the Accounting Standards for Business Enterprises - Merger
and the distributable profits of the parent company, the distributable profits
of the Company in 2023 are as follows:
Unit: RMB Currency: RMB
Merger Parent company
Undistributed profits at end of 2023 30,951,017,846.73 17,667,611,575.72
Including: net profit attributable to the parent company in 2023 6,704,936,953.85 3,621,346,814.36
Distributable opening profits carried forward 26,818,018,726.07 16,638,112,594.55
2022 dividends distributed 2,049,899,453.13 2,049,899,453.13
Appropriation to surplus reserves 362,134,681.44 362,134,681.44
Miscellaneous 159,903,698.62 179,813,698.62
According to the relevant laws and regulations and the Articles of Association
of the Company and considering the interests of shareholders and the business
development needs of the Company, the Board of Directors hereby submit the
2023 Profit Distribution Plan as follows:
1. The legal accumulation fund shall be accrued as 10% of the net profit of
the parent company;
2. Cash dividends will be distributed as RMB 0.4948 per share (tax-inclusive),
accounting for more than 55% of the net profit attributable to the parent
company in the consolidated statement of the Company in 2023.
II. 2023 Dividend Distribution Plan
Based on the total share capital of 7,454,179,797 shares at the end of 2023, a
cash dividend (tax-inclusive) of RMB 0.4948 per share was distributed, and a
total cash dividend of about RMB 3,688,328,163.56 was distributed, accounting
for 55% of the net profit attributable to the owners of the parent company in
2023.
Dividend Distribution Plan of the Company in Recent Three Years
Unit: RMB Currency: RMB
Year of dividend distribution Number of share bonus per 10 shares Number of dividends per 10 shares (RMB) (tax inclusive) Number of shares increase by transferring per 10 shares (share) Amount of cash dividends (including tax) Net profits attributed to shareholders of listed company in the Annual Proportion in net profits attributed to shareholders of listed company in the
Consolidated Statement of Dividend consolidated statement (%)
2023 - 4.9480 - 3,688,328,163.56 6,704,936,953.85 55.01
2022 - 2.7500 - 2,049,899,444.18 4,079,375,650.03 50.25
2021 - 1.6350 - 1,218,758,396.81 2,436,891,836.54 50.01
The cumulative cash dividend amount in the last three years accounts for about
158% of the average annual net profit of the Company's merger in the last
three years.
III. Notes
Maintaining continuity and stability of the profit distribution policy, the
Company has continuously implemented a prudent cash dividend and profit
distribution plan since the listing while considering the Company's long-term
interests, the overall interests of all shareholders, and the Company's
sustainable development. This profit distribution plan complies with the
objective conditions of the Company and the provisions of relevant laws,
regulations, normative documents, and the Articles of Association, and will
not affect the normal operation and long-term development of the Company.
The above proposal has been deliberated and approved at the 27th Meeting of
the Twelfth Board of Directors on April 29, 2024, and it is hereby presented
to you for deliberation and approval.
Proposal VI
SDIC Power Holdings Co., Ltd.
Proposal on Amending the Articles of Association
Dear shareholders and shareholder representatives,
The Company proposed to amend its Articles of Association and make industrial
and commercial registration of changes according to the Trial Administrative
Measures of Overseas Securities Offering and Listing by Domestic Companies and
the Administrative Measures for Independent Directors of Listed Companies
issued by the China Securities Regulatory Commission and the Guidelines for
Articles of Association of Listed Companies (Revised in 2023) and the
Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed
Companies - Standardized Operation issued by Shanghai Stock Exchange, with
details as follows:
I. Reasons and Main Contents of Amendments to the Articles of Association
(I) The Notice on Implementing the Essential Articles of Association for
Overseas Listed Companies has been abolished by the Trial Administrative
Measures of Overseas Securities Offering and Listing by Domestic Companies
(issued on February 17, 2023, and implemented on March 31, 2023) and some
provisions have been deleted and revised.
(II) According to the Administrative Measures for Independent Directors of
Listed Companies issued in 2023, provisions on the proposal of independent
directors to convene an extraordinary General Meeting of Shareholders, the
nomination of independent director candidates, and obligations and authorities
of independent directors have been amended.
(III) Some provisions have been added or deleted according to the Guidelines
for Articles of Association of Listed Companies (Revised in 2023) and the
Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed
Companies - Standardized Operation.
II. Clauses Amended in the Articles of Association
It is proposed to amend the following clauses in the Articles of Association
of SDIC Power (see the table below):
Existing provision Amended provisions
(The amended or added contents are
indicted by underline and bold)
1.1 To protect the lawful rights and interests of the Company, its 1.1 To protect the lawful rights and interests of the Company, its
shareholders, and creditors and regulate the organization and actions of the shareholders, and creditors and regulate the organization and actions of the
Company, these Articles of Association ("these Articles") are formulated Company, these Articles of Association ("these Articles") are formulated
according to the Company Law of the People's Republic of China (hereinafter according to the Company Law of the People's Republic of China (hereinafter
referred to as the "Company Law"), the Securities Law of the People's Republic referred to as the "Company Law"), the Securities Law of the People's Republic
of China (hereinafter referred to as the "Securities Law"), the Special of China (hereinafter referred to as the "Securities Law"), the Trial
Provisions of the State Council Concerning the Floatation and Listing Abroad Administrative Measures of Overseas Securities Offering and Listing by
of Stocks by Limited Stock Companies (hereinafter referred to as the "Special Domestic Companies (hereinafter referred to as the "Trial Administrative
Provisions"), the Essential Articles of Association for Overseas Listed Measures"), the Guidelines No. 1 of Shanghai Stock Exchange for
Companies (hereinafter referred to as the "Essential Articles"), the Self-regulation of Listed Companies - Standardized Operation (hereinafter
Constitution of the Communist Party of China (hereinafter referred to as the referred to as "Standardized Operation"), the Constitution of the Communist
"Constitution of the CPC"), and other related regulations. Party of China (hereinafter referred to as the "Constitution of the CPC"), and
other related regulations.
1.2 The Company is a company limited by shares established in accordance with 1.2 The Company is a company limited by shares established in accordance with
the Company Law, the Special Provisions, and other regulations in China the Company Law and other regulations in China (hereinafter referred to as
(hereinafter referred to as "the Company"). The Company was approved by the "the Company"). The Company was approved by the 1989 No. 2 Document of the
1989 No. 2 Document of the Hubei Provincial Commission for Structural Hubei Provincial Commission for Structural Reforms and established in the form
Reforms and established in the form of a public offering. It was registered in of a public offering. It was registered in the Hubei Provincial Administration
the Hubei Provincial Administration for Industry and Commerce and obtained a for Industry and Commerce and obtained a business license. In 2002, due to
business license. In 2002, due to changes in the Company's main business, the changes in the Company's main business, the Company was registered with the
Company was registered with the Gansu Provincial Administration for Industry Gansu Provincial Administration for Industry and Commerce instead and obtained
and Commerce instead and obtained a business license. In 2014, due to the a business license. In 2014, due to the needs of company development, the
needs of company development, the Company was registered with the State Company was registered with the State Administration for Industry and Commerce
Administration for Industry and Commerce instead. The Company's unified social instead. The Company's unified social credit code is 911100002717519818.
credit code is 911100002717519818.
4.3.1 Independent directors have the right to propose to the Board of 4.3.1 With the consent of more than half of all independent directors,
Directors for an extraordinary General Meeting of Shareholders. The Board of independent directors have the right to propose to the Board of Directors to
Directors shall, subject to provisions of laws, administrative regulations, convene an extraordinary General Meeting of Shareholders. Where independent
and these Articles, give a written response to agree or disagree to hold an directors exercise such right of proposal, the Company shall disclose
extraordinary General Meeting of Shareholders within ten (10) days after its promptly. Where the above-mentioned right cannot be normally exercised, the
receipt of the proposal for the extraordinary General Meeting of Shareholders Company shall disclose the specific circumstances and reasons. The Board of
by independent directors. Directors shall, subject to provisions of laws, administrative regulations,
and these Articles, give a written response to agree or disagree to hold an
Where the Board of Directors agrees to convene an extraordinary General extraordinary general meeting of shareholders within ten (10) days after its
Meeting of Shareholders, the notice of convening the extraordinary General receipt of the proposal for the extraordinary general meeting of shareholders
Meeting of Shareholders will be issued within five days after the resolution by independent directors.
of the Board of Directors is made. Where the Board of Directors does not agree
to convene an extraordinary General Meeting of Shareholders, it shall explain Where the Board of Directors agrees to convene an extraordinary general
the reasons and make an announcement. meeting of shareholders, the notice of convening the extraordinary general
meeting of shareholders will be issued within five days after the resolution
of the Board of Directors is made. Where the Board of Directors does not agree
to convene an extraordinary general meeting of shareholders, it shall explain
the reasons and make an announcement.
4.3.6 All costs and expenses as necessary for the General Meeting of 4.3.6 All costs and expenses as necessary for the General Meeting of
Shareholders convened by the Supervisory Committee or shareholders shall be Shareholders convened by the Supervisory Committee or shareholders shall be
borne by the Company. Where the Board of Directors does not agree to convene borne by the Company. If the Board of Directors does not provide the register
the General Meeting of Shareholders due to Paragraph 3 of Article 4.3.3 in of shareholders, the convener may use relevant notice on convening the General
these Articles, the Supervisory Committee or the shareholders shall convene a Meeting of Shareholders to apply for that register to the securities
General Meeting of Shareholders. The expenses shall be deducted from the registration and settlement organization. The Register of Shareholders
amount owed by the Company to a defaulted director. obtained by the convener shall not be used for purposes other than convening
the General Meeting of Shareholders.
4.4.2 Where the Company convenes a General Meeting of Shareholders, the Board 4.4.2 Where the Company convenes a general meeting of shareholders, the Board
of Directors, the Supervisory Committee, and the shareholder(s) holding more of Directors, the Supervisory Committee, and the shareholder(s) holding more
than three percent of the shares in the Company individually or collectively than three percent of the shares in the Company individually or collectively
shall have the right to submit proposals to the Company. shall have the right to submit proposals to the Company.
Shareholders individually or jointly holding not less than three percent of Where a qualified shareholder submits a provisional proposal prior to the
the Company's shares may submit a provisional proposal to the convener in General Meeting of Shareholders, the percentage of shares held between the
writing ten (10) days prior to the date of the General Meeting of issuance of the notice of the proposal and the announcement of the resolution
Shareholders. The convener shall issue a supplementary notice of the General of the meeting shall not be less than three percent.
Meeting of Shareholders to announce the content of the provisional proposal
within two days after receiving the proposal. Where a shareholder proposes a provisional proposal, it shall provide the
convener with the certification documents for holding more than three percent
Except for the circumstances in the preceding provisions, the convener shall of the shares of the listed company. Where a shareholder jointly proposes a
not modify those proposals as listed in the notice of the general meeting of proposal by way of entrustment, the entrusting shareholder shall issue a
shareholders or add any new proposal after giving the notice. written authorization document to the entrusted shareholder.
The General Meeting of Shareholders shall not vote and make a resolution on Shareholders individually or jointly holding not less than three percent of
any proposal not listed in the notice of the General Meeting of Shareholders the Company's shares may submit a provisional proposal to the convener in
or not conforming to 4.4.1 of these Articles. writing ten (10) days prior to the date of the general meeting of
shareholders. The convener shall issue a supplementary notice of the general
meeting of shareholders to announce the content of the provisional proposal
within two days after receiving the proposal.
Except for provisional proposals, it is not allowed to modify the proposals
listed in the notice of the General Meeting of Shareholders or add new
proposals after the Company issues the notice of the General Meeting of
Shareholders.
4.4.5 The notice of the General Meeting of Shareholders shall comply with the 4.4.5 The notice of the General Meeting of Shareholders shall include the
following requirements: following:
(I) The notice shall be in writing; (I) Date, place, and duration of the meeting;
(II) The notice shall designate the time, place, and duration of the meeting; (II) Matters and proposals to be discussed at the meeting;
(III) The notice shall state the matters and proposals to be discussed at the (III) A statement in clear words that: all shareholders have the right to
meeting; attend the General Meeting of Shareholders, or may attend and vote in the
meeting by proxy in written form, who may not necessarily be the shareholder
(IV) The notice shall provide the shareholders with materials and explanations of the Company;
needed by them for making informed decisions on the matters for review,
including but not limited to providing the specific conditions and contract (IV) The date of equity registration for shareholders entitled to attend the
(if any) of the proposed transactions when the Company proposes the General Meeting of Shareholders;
consolidation, share repo, capital stock reorganization or other
reorganization, and explaining the cause and consequence in details; (V) Name and telephone number of the standing contact person for the meeting;
(V) If any directors, supervisors, managers, or other senior executives are (VI) Voting time and voting procedures by online or other means.
materially interested in the matters to be discussed, the nature and degree of
the interest shall be disclosed; if the effect of the matters to be discussed The notice and supplementary notice of the General Meeting of Shareholders
on such directors, supervisors, the general manager, or other senior shall fully and completely disclose the specific contents of all the
executives as shareholders is different from that on other similar proposals. If the independent directors shall give comments on matters
shareholders, a detailed explanation shall be given; proposed to be discussed, the comments and reasons of the independent
directors shall be disclosed when the notice or supplemental notice of the
(VI) The notice shall bear the full text of any special General Meeting of Shareholders is given.
resolution to be passed at the meeting;
The starting time of online vote or other ways of voting of the General
(VII) The notice shall have a statement in clear words that: all Meeting of Shareholders shall not be earlier than 3:00 p.m. of the date before
shareholders have the right to attend the General Meeting of Shareholders, or the on-site convening of the General Meeting of Shareholders and later than
may attend and vote in the meeting by proxy in written form, who may not 9:30 a.m. of the date of on-site convening of the meeting, while the ending
necessarily be the shareholder of the Company; time shall not be before 3:00 p.m. of the date when the on-site General
Meeting of Shareholders ends.
(VIII) The notice shall state the time and place for delivery of the meeting
vote proxy; The interval between the date of equity registration and the date of the
meeting shall not be more than seven (7) working days. The date of equity
(IX) The note shall designate the date of equity registration for shareholders registration shall not be changed upon determination.
entitled to attend the General Meeting of Shareholders; the interval between
the date of equity registration and the date of the meeting shall not be more
than seven (7) working days, and the date of equity registration shall not be
changed upon determination;
(X) The note shall specify the name and telephone number of the standing
contact person for the meeting.
4.4.6 Where matters concerning the election of directors and supervisors are 4.4.6 Where matters concerning the election of directors and supervisors are
to be discussed at the General Meeting of Shareholders, the notice of the to be discussed at the General Meeting of Shareholders, the notice of the
General Meeting of Shareholders shall sufficiently disclose detailed General Meeting of Shareholders shall sufficiently disclose detailed
information of director and supervisor candidates, which shall at least information of director and supervisor candidates, which shall at least
include: include:
(I) Education background, work experience, part-time jobs, and other personal (I) Education background, work experience, part-time jobs, and other personal
information; information;
(II) Whether there is any affiliation to the Company or the controlling (II) Whether there is any affiliation to the directors, supervisors, senior
shareholder and actual controller of the Company; executives, actual controller, and shareholders holding more than 5% shares of
the Company;
(III) Disclosure of the number of shares held in the Company;
(III) Whether any circumstances prohibit such candidates from serving as
(IV) Whether such candidates are subject to any punishment by the China directors, supervisors, or senior executives according to the Company Law,
Securities Regulatory Commission and other relevant departments and any other laws and regulations, and other relevant provisions;
disciplinary action by stock exchanges. In addition to the election of
directors and supervisors by accumulative voting, each director or supervisor (IV) The number of shares held in the Company;
candidate shall be put forward by a single proposal.
(V) Whether such candidates are prohibited by the China Securities Regulatory
Commission from serving as directors, supervisors, and senior executives in
listed companies, and the prohibition term has not yet expired;
(VI) Whether such candidates are publicly recognized by any stock exchange as
unfit to be directors, supervisors, or senior executives of listed companies,
and the term has not yet expired;
(VII) Other important matters required to be disclosed by the Shanghai Stock
Exchange.
In addition to the election of directors and supervisors by accumulative
voting, each director or supervisor candidate shall be put forward by a single
proposal.
4.4.8 The General Meeting of Shareholders shall not be postponed or canceled 4.4.8 The general meeting of shareholders shall not be postponed or canceled
and those proposals as listed in the notice of the General Meeting of and those proposals as listed in the notice of the general meeting of
Shareholders shall not be canceled without justified reasons after the giving shareholders shall not be canceled without justified reasons after the giving
of the notice. In case of postponement or cancellation, the convener shall of the notice. In case of postponement or cancellation, the convener shall
proclaim it and explain the reasons at least two (2) working days before the proclaim it and explain the reasons at least two (2) working days before the
originally determined date of the meeting. originally determined date of the meeting. If the General Meeting of
Shareholders is postponed, the date of the postponed meeting shall also be
disclosed.
4.5.2 All shareholders registered on the date of equity registration or their 4.5.2 All shareholders registered on the date of equity registration or their
proxies shall be entitled to attend the General Meeting of Shareholders. They proxies shall be entitled to attend the general meeting of shareholders. They
are also entitled to vote according to relevant laws, regulations, and these are also entitled to vote according to relevant laws, regulations, and these
Articles. Articles.
Any shareholder who has the right to attend and vote at the General Meeting of Any shareholder who has the right to attend and vote at the General Meeting of
Shareholders may attend the General Meeting of Shareholders in person or may Shareholders may attend the General Meeting of Shareholders in person or may
appoint one or more persons (who may not be shareholders of the Company) as appoint one person (who may not be a shareholder of the Company) as his/her
his/her proxy/proxies and attend and vote at the meeting on his/her behalf. proxy and attend and vote at the meeting on his/her behalf. The shareholder's
The shareholder's proxy, under the authorization of such shareholder, may proxy, under the authorization of such shareholder, may exercise the following
exercise the following rights: rights:
(I) Exercising the shareholder's right to speak at the General Meeting of (I) Exercising the shareholder's right to speak at the general meeting of
Shareholders; shareholders;
( II) Requesting on its initiative or jointly with others to vote by poll; ( II) Requesting on its initiative or jointly with others to vote by poll.
(III) Voting rights shall be exercised by a show of hands or a poll, but if
more than one shareholder's proxy is appointed, such shareholder's proxy shall
only exercise the voting rights by poll.
4.5.13 The Board of Directors and the Supervisory Committee shall report to 4.5.13 The Board of Directors and the Supervisory Committee shall report to
the General Meeting of Shareholders on their work in the past year at the the General Meeting of Shareholders on their work in the past year at the
Annual General Meeting of Shareholders. Each independent director shall also Annual General Meeting of Shareholders. Each independent director shall also
give his/her report on work. submit to the Annual General Meeting of Shareholders an annual report on
his/her performance of duties.
4.5.16 There shall be minutes of the General Meeting of Shareholders, which 4.5.16 There shall be minutes of the General Meeting of Shareholders, which
shall be taken by the Secretary of the Board of Directors. The minutes shall shall be taken by the Secretary of the Board of Directors. The minutes shall
record: record:
(I) Time, place, agenda, and name of the convener of the meeting; (I) Time, place, agenda, and name of the convener of the meeting;
(II) Names of the meeting moderator and directors, supervisors, the general (II) Names of the meeting moderator and directors, supervisors, the general
manager, and other senior executives present at or attending the meeting; manager, the Secretary of the Board of Directors, and other senior executives
present at or attending the meeting;
(III) Number of shareholders and proxies attending the meeting, total number
of voting shares held by them, and their proportion in the total number of (III) Number of shareholders and proxies attending the meeting, total number
shares of the Company; of voting shares held by them, and their proportion in the total number of
shares of the Company;
(IV) Consideration process, main points of address, and voting results of each
proposal; (IV) Consideration process, main points of address, and voting results of each
proposal;
(V) Inquiries or suggestions raised by shareholders and the corresponding
replies or explanations; (V) Inquiries or suggestions raised by shareholders and the corresponding
replies or explanations;
(VI) Names of the lawyer, vote counter, and scrutineer;
(VI) Names of the lawyer, vote counter, and scrutineer;
(VII) Other information that shall be recorded in the minutes as stipulated
herein. (VII) Other information that shall be recorded in the minutes as stipulated
herein.
4.6.1 Resolutions of the General Meeting of Shareholders include ordinary and 4.6.1 Resolutions of the General Meeting of Shareholders include ordinary and
special resolutions. special resolutions.
Any ordinary resolution of the General Meeting of Shareholders shall be passed Any ordinary resolution of the General Meeting of Shareholders shall be passed
with more than 1/2 of the voting rights held by the shareholders (including with more than half of the voting rights held by the shareholders (including
shareholders' proxies) who attend the meeting. shareholders' proxies) who attend the meeting.
Any special resolution of the General Meeting of Shareholders shall be passed Any special resolution of the General Meeting of Shareholders shall be passed
with more than two-thirds of the voting rights held by the shareholders with more than two-thirds of the voting rights held by the shareholders
(including shareholders' proxies) who attend the meeting. (including shareholders' proxies) who attend the meeting.
4.6.7 The list of director and supervisor candidates shall be submitted to the 4.6.7 The list of director and supervisor candidates shall be submitted to the
General Meeting of Shareholders for voting in the form of a proposal. General Meeting of Shareholders for voting in the form of a proposal.
When the General Meeting of Shareholders conducts voting to elect the When the General Meeting of Shareholders conducts voting to elect the
directors or supervisors, cumulative voting shall apply according to these directors or supervisors, cumulative voting shall apply according to these
Articles or a resolution of the General Meeting of Shareholders. The Articles or a resolution of the General Meeting of Shareholders. The
aforementioned directors include independent directors and non-independent aforementioned directors include independent directors and non-independent
directors, and supervisors specifically refer to supervisors who are not directors, and supervisors specifically refer to supervisors who are not
represented by employees. The directors and supervisors served by employee represented by employees. The directors and supervisors served by employee
representatives shall be democratically elected or replaced by the employees representatives shall be democratically elected or replaced by the employees
of the Company, and the relevant provisions of this article on the election at of the Company, and the relevant provisions of this article on the election at
the General Meeting of Shareholders and cumulative voting system shall not the General Meeting of Shareholders and cumulative voting system shall not
apply. apply.
The above-mentioned cumulative voting system means that each share has voting The above-mentioned cumulative voting system means that each share has voting
rights of the same number of directors or supervisors to be elected and voting rights of the same number of directors or supervisors to be elected and voting
rights held by a shareholder can be used in a centralized way in case of rights held by a shareholder can be used in a centralized way in case of
election of directors or supervisors at the General Meeting of Shareholders. election of directors or supervisors at the General Meeting of Shareholders.
Director and supervisor candidates with the most votes shall be elected and Director and supervisor candidates with the most votes shall be elected and
the number of votes cast for the elected directors and supervisors shall the number of votes cast for the elected directors and supervisors shall
exceed 50% (including 50%) of the total shares held by shareholders attending exceed 50% of the total shares held by shareholders attending the General
the General Meeting of Shareholders. Meeting of Shareholders.
To ensure that the election of independent directors meets the regulations, To ensure that the election of independent directors meets the regulations,
the Company conducts separate elections for independent directors and the Company conducts separate elections for independent directors and
non-independent directors, both using the cumulative voting system. The non-independent directors, both using the cumulative voting system. The
specific operation is as follows: In the election of independent directors, specific operation is as follows: In the election of independent directors,
each shareholder present at the meeting is entitled to such number of votes as each shareholder present at the meeting is entitled to such number of votes as
equal to the product of the total number of shares held by it and the number equal to the product of the total number of shares held by it and the number
of independent directors to be elected at the General Meeting of Shareholders, of independent directors to be elected at the General Meeting of Shareholders,
and such votes can only be used for the independent director candidates in the and such votes can only be used for the independent director candidates in the
General Meeting of Shareholders. In the election of non-independent directors, General Meeting of Shareholders. In the election of non-independent directors,
each shareholder present at the meeting is entitled to such number of votes as each shareholder present at the meeting is entitled to such number of votes as
equal to the product of the total number of shares held by it and the number equal to the product of the total number of shares held by it and the number
of non-independent directors to be elected at the General Meeting of of non-independent directors to be elected at the General Meeting of
Shareholders, and such votes can only be used for candidates of Shareholders, and such votes can only be used for candidates of
non-independent directors in the General Meeting of Shareholders. non-independent directors in the General Meeting of Shareholders.
In the election of supervisors in the Company, each shareholder present at the In the election of supervisors in the Company, each shareholder present at the
meeting is entitled to such number of votes as equal to the product of the meeting is entitled to such number of votes as equal to the product of the
total number of shares held by it and the number of supervisors to be elected total number of shares held by it and the number of supervisors to be elected
at the General Meeting of Shareholders, and such votes can only be used for at the General Meeting of Shareholders, and such votes can only be used for
the candidates of supervisors in the General Meeting of Shareholders. the candidates of supervisors in the General Meeting of Shareholders.
If the number of directors or supervisors elected at the General Meeting of If the number of directors or supervisors elected at the General Meeting of
Shareholders falls short of the required number, or if there are multiple Shareholders falls short of the required number, or if there are multiple
candidates with the same number of votes but only one can be elected as a candidates with the same number of votes but only one can be elected as a
director or supervisor, a second round of voting shall be conducted for the director or supervisor, a second round of voting shall be conducted for the
remaining positions until all the required directors and supervisors are remaining positions until all the required directors and supervisors are
elected. During the second round of voting, the total number of voting rights elected. During the second round of voting, the total number of voting rights
of each shareholder participating in the vote is equal to the product of the of each shareholder participating in the vote is equal to the product of the
number of shares held by it and the number of directors or supervisors still number of shares held by it and the number of directors or supervisors still
needed to be elected. Any matters not covered by the cumulative voting method needed to be elected. Any matters not covered by the cumulative voting method
shall be resolved through consultation between the moderator of the meeting shall be resolved through consultation between the moderator of the meeting
and the shareholders attending the meeting. If consensus cannot be reached and the shareholders attending the meeting. If consensus cannot be reached
through consultation, it shall be handled following the opinion passed by the through consultation, it shall be handled following the opinion passed by the
shareholders present at the meeting with half or more of the voting rights. shareholders present at the meeting with more than half of the voting rights.
The Board of Directors shall announce to the shareholders the resumes and The Board of Directors shall announce to the shareholders the resumes and
basic information of director and supervisor candidates. basic information of director and supervisor candidates.
4.6.11 Unless otherwise required by the listing rules of the stock exchange on Deleted.
which the Company's shares are listed and/or relevant laws, regulations, and
provisions, or before or after a show of hands the following persons demand a
vote by poll, the General Meeting of Shareholders shall vote by a show of
hands:
(I) The moderator of the meeting;
(II) At least two shareholders or their proxies with voting rights;
(III) One or more shareholders (including their proxies) individually or
collectively holding more than 10% (included) of the voting shares at the
meeting.
Unless a vote by poll is proposed, the moderator of the meeting shall announce
the adoption of the resolution as per the result of a show of hands, which
shall be recorded in the minutes of the meeting as the final basis, without
proving the number of votes for or against the resolution adopted at the
meeting or its proportion.
A request for a vote by poll may be withdrawn by the proposer.
4.6.12 If the matter required to be voted on by poll is about electing the Deleted.
moderator or terminating the meeting, voting by poll shall be made
immediately. Other matters required to be voted on by poll shall be determined
by the moderator in terms of the time of voting. The meeting could go on,
other matters could be discussed and the voting result is still deemed as the
resolution approved at such meeting.
4.6.13 At the time of vote by poll, shareholders with two or more polls of Deleted.
voting rights (including shareholders' proxies) need not vote for or against
all voting rights.
4.6.14 In the case of equal affirmative and dissenting votes, the shareholder Deleted. Serial numbers 4.6.15-4.6.22 are changed to 4.6.11-4.6.18
acting as the moderator of the meeting shall have the right to cast one more sequentially.
vote.
5.1.1 Directors shall be elected or replaced by the General Meeting of 5.1.1 Directors shall be elected or replaced by the General Meeting of
Shareholders and the term of office of directors is three years. Directors may Shareholders and the term of office of directors is three years. Directors may
serve consecutive terms if elected successfully upon the expiry of the term of serve consecutive terms if elected successfully upon the expiry of the term of
office. Before a director's term of office expires, the General Meeting of office. Before a director's term of office expires, the General Meeting of
Shareholders cannot terminate his or her duties without a reason. There shall Shareholders cannot terminate his or her duties without a reason. There shall
be employee representatives of the Company among the members of the Board of be employee representatives of the Company among the members of the Board of
Directors. After a democratic election or replacement by the Company's Directors. After a democratic election or replacement by the Company's
employees, the employee representatives who serve as directors directly join employees, the employee representatives who serve as directors directly join
the Board of Directors. the Board of Directors.
A director's term of office commences from the date he or she takes up the A director's term of office commences from the date he or she takes up the
appointment until the current term of service of the Board of Directors appointment until the current term of service of the Board of Directors
expires. If a director's term of office expires but a new director is not yet expires. If a director's term of office expires but a new director is not yet
appointed, before the newly elected director takes up an appointment, the appointed, before the newly elected director takes up an appointment, the
original director shall still carry out his or her duties according to the original director shall still carry out his or her duties according to the
law, administrative regulations, department regulations, and these Articles. law, administrative regulations, department regulations, and these Articles.
A director's post can also be taken up by the General Manager or other The general manager or other senior executive may concurrently serve as a
Executives. However, the total number of General Manager or other Senior director, but the total number of directors who concurrently serve as the
Executives who are also directors shall not exceed half the total number of general manager or other senior executive and directors who are employee
directors. representatives shall not exceed one-half of the total number of directors of
the Company.
A director needs not hold any shares in the Company.
A director needs not hold any shares in the Company.
5.1.2 Director candidates other than independent directors and employee 5.1.2 Director candidates other than independent directors and employee
directors shall be nominated by the Board of Directors and shareholders who directors shall be nominated by the Board of Directors and shareholders who
individually or jointly hold more than three percent of the issued shares of individually or jointly hold more than three percent of the issued shares of
the Company and elected by the General Meeting of Shareholders of the Company. the Company and elected by the General Meeting of Shareholders of the Company.
The Board of Directors, Supervisory Committee, and the shareholders
individually or jointly holding more than one percent of the issued capital
stock of the Company can nominate the candidates of independent directors who
shall go through the election of the General Meeting of Shareholders. Legally
established investor protection institutions may publicly request shareholders
to entrust them to exercise the right to nominate independent directors on
their behalf.
5.1.10 Independent directors shall perform duties according to laws, 5.1.10 Independent directors should bear the duties of loyalty and diligence
administrative regulations, and relevant provisions of the China Securities to the listed company and all shareholders. They should carefully perform
Regulatory Commission and stock exchanges. their duties according to laws, administrative regulations, the provisions of
the China Securities Regulatory Commission, business rules of stock exchanges,
and the Articles of Association, play a role in participating in
decision-making, supervision, balancing, and providing professional advice in
the Board of Directors, safeguard the overall interests of listed companies,
and protect the legitimate rights and interests of minority shareholders.
5.2.8 The Board of Directors shall establish strict review and decision-making 5.2.8 The Board of Directors shall determine the authorities over foreign
procedures according to the authority for transactions such as foreign investment, purchase and sale of assets, pledge of assets, external
investment, purchase and sale of major assets, pledge of assets, external guarantees, entrusted financing, related-party transactions, and external
guarantees, related-party transactions, and external donations as stipulated donations, and establish strict examination and decision-making procedures.
in these Articles. Major investment projects shall be reviewed by relevant Key investment projects shall be reviewed by the relevant experts and
experts and professionals and submitted to the General Meeting of Shareholders professionals and submitted to the General Meeting of Shareholders for
for approval. approval.
(I) The following transactions of the Company or its controlled subsidiaries (I) The following transactions of the Company or its controlled subsidiaries
(except that the Company provides guarantees and receives cash assets and (except that the Company provides guarantees and receives cash assets and
debts which purely reduce the Company's obligations) shall be reviewed and debts which purely reduce the Company's obligations) should be reviewed and
approved by the Board of Directors: approved by the Board of Directors:
1. The total amount of the assets involved in such transaction (calculated 1. The total amount of the assets involved in such transaction (calculated
based on the higher of the book value and estimated value if both exist) based on the higher of the book value and estimated value if both exist)
accounts for more than one percent and less than fifty percent of the audited accounts for more than one percent and less than fifty percent of the audited
total assets of the Company for the latest fiscal year; total assets of the Company for the latest fiscal year;
2. The net assets involved in the transaction object (such as equity) 2. The net assets involved in the transaction object (such as equity)
(calculated based on the higher of the book value and estimated value if both (calculated based on the higher of the book value and estimated value if both
exist) account for more than one percent and less than fifty percent of the exist) account for more than one percent and less than fifty percent of the
audited net assets of the Company for the latest fiscal year, or with an audited net assets of the Company for the latest fiscal year, or with an
absolute amount of less than RMB 50 million although the aforementioned absolute amount of less than RMB 50 million although the aforementioned
criteria are met; criteria are met;
3. The transaction has a turnover (including assumed debts and expenses) of 3. The transaction has a turnover (including assumed debts and expenses) of
more than one percent and less than fifty percent of the audited net assets of more than one percent and less than fifty percent of the audited net assets of
the Company for the latest fiscal year, or with an absolute amount of less the Company for the latest fiscal year, or with an absolute amount of less
than RMB 50 million although the aforementioned criteria are met; than RMB 50 million although the aforementioned criteria are met;
4. Profits from the transaction account for more than one percent and less 4. Profits from the transaction account for more than one percent and less
than fifty percent of the audited net profits of the Company for the latest than fifty percent of the audited net profits of the Company for the latest
fiscal year, or with an absolute amount of less than RMB 5 million although fiscal year, or with an absolute amount of less than RMB 5 million although
the aforementioned criteria are met; the aforementioned criteria are met;
5. Relevant operating revenue of the transaction object (such as stock equity) 5. Relevant operating revenue of the transaction object (such as stock equity)
in the latest fiscal year accounts for more than one percent and less than in the latest fiscal year accounts for more than one percent and less than
fifty percent of the audited operating revenue of the Company for the latest fifty percent of the audited operating revenue of the Company for the latest
fiscal year, or with an absolute amount of less than RMB 50 million although fiscal year, or with an absolute amount of less than RMB 50 million although
the aforementioned criteria are met; the aforementioned criteria are met;
6. Relevant net profit of the transaction object (such as stock equity) in the 6. Relevant net profit of the transaction object (such as stock equity) in the
latest fiscal year accounts for more than one percent and less than fifty latest fiscal year accounts for more than one percent and less than fifty
percent of the audited net profits of the Company for the latest fiscal year, percent of the audited net profits of the Company for the latest fiscal year,
or with an absolute amount of less than RMB 5 million although the or with an absolute amount of less than RMB 5 million although the
aforementioned criteria are met. aforementioned criteria are met.
If the data involved in the above indicators are negative, the absolute value If the data involved in the above indicators are negative, the absolute value
shall be taken for the calculation. should be taken for the calculation.
The external guarantees incurred by the Company shall be submitted to the The external guarantees incurred by the Company should be submitted to the
General Meeting of Shareholders for review and approval by the Board of general meeting of shareholders for review and approval by the Board of
Directors, except for those stipulated by laws and regulations, regulatory Directors, except for those stipulated by laws and regulations, regulatory
authorities, and Article 4.2.2 of these Articles. authorities, and Article 4.2.2 of these Articles.
(II) The following transactions occurring in the Company (except that the (II) The following transactions occurring in the Company (except that the
Company provides guarantees, receives cash assets and debts which purely Company provides guarantees, receives cash assets and debts which purely
reduce the Company's obligations) shall be reviewed and approved by the reduce the Company's obligations) should be reviewed and approved by the
chairman as authorized by the Board of Directors: chairman as authorized by the Board of Directors:
1. The total amount of the assets involved in such a transaction (calculated 1. The total amount of the assets involved in such a transaction (calculated
based on the higher of the book value and estimated value if both exist) based on the higher of the book value and estimated value if both exist)
accounts for more than one percent and less than ten percent of the audited accounts for more than one percent and less than ten percent of the audited
total assets of the Company for the latest fiscal year; total assets of the Company for the latest fiscal year;
2. The net assets involved in transaction object (such as equity) (calculated 2. The net assets involved in transaction object (such as equity) (calculated
based on the higher of the book value and estimated value if both exist) based on the higher of the book value and estimated value if both exist)
account for more than one percent and less than ten percent of the audited net account for more than one percent and less than ten percent of the audited net
assets of the Company for the latest fiscal year; assets of the Company for the latest fiscal year;
3. The transaction has a turnover (including assumed debts and expenses) of 3. The transaction has a turnover (including assumed debts and expenses) of
more than one percent and less than ten percent of the audited net assets of more than one percent and less than ten percent of the audited net assets of
the Company for the latest fiscal year; the Company for the latest fiscal year;
4. Profits from the transaction account for more than one percent and less 4. Profits from the transaction account for more than one percent and less
than ten percent of the audited net profits of the Company for the latest than ten percent of the audited net profits of the Company for the latest
fiscal year; fiscal year;
5. Relevant operating revenue of the transaction object (such as stock equity) 5. Relevant operating revenue of the transaction object (such as stock equity)
in the latest fiscal year accounts for more than one percent and less than ten in the latest fiscal year accounts for more than one percent and less than ten
percent of the audited operating revenue of the Company for the latest fiscal percent of the audited operating revenue of the Company for the latest fiscal
year; year;
6. Relevant net profit of the transaction object (such as stock equity) in the 6. Relevant net profit of the transaction object (such as stock equity) in the
latest fiscal year accounts for more than one percent and less than ten latest fiscal year accounts for more than one percent and less than ten
percent of the audited net profits of the Company for the latest fiscal year. percent of the audited net profits of the Company for the latest fiscal year.
If the data involved in the above indicators are negative, the absolute value If the data involved in the above indicators are negative, the absolute value
should be taken for the calculation. should be taken for the calculation.
(III) The external donations of the Company shall be approved by the Board of (III) The external donations of the Company shall be approved by the Board of
Directors, and the general manager shall be authorized to make decisions on Directors, and the general manager shall be authorized to make decisions on
matters with a single amount of RMB 30 million or less. matters with a single amount of RMB 30 million or less.
5.2.16 A meeting of the Board of Directors may not be held unless more than 5.2.16 A meeting of the Board of Directors may not be held unless more than
half of the directors are present. The Board of Directors shall make half of the directors are present. The Board of Directors shall make
resolutions. Except for the circumstances in which directors should avoid resolutions. Except for the circumstances in which directors should avoid
voting according to relevant laws, regulations, and the provisions of these voting according to relevant laws, regulations, and the provisions of these
Articles, more than half of the directors of the Company must vote for the Articles, more than half of the directors of the Company must vote for the
proposal. The Board of Directors shall make resolutions on guarantee matters proposal. The Board of Directors shall make resolutions on guarantee matters
within its authority according to the provisions of these Articles. In within its authority according to the provisions of these Articles. In
addition to the agreement of more than half of all directors of the Company, addition to the agreement of more than half of all directors of the Company,
the resolutions must also be approved by more than two-thirds of the directors the resolutions must also be approved by more than two-thirds of the directors
present at the meeting. If it is stipulated in laws, administrative present at the meeting. If it is stipulated in laws, administrative
regulations, and these Articles that the Board of Directors shall obtain the regulations, and these Articles that the Board of Directors shall obtain the
consent of more directors when creating a resolution, such stipulation shall consent of more directors when creating a resolution, such stipulation shall
apply. apply.
The one-person-one-vote system shall be practiced when resolutions of the The one-person-one-vote system shall be practiced when resolutions of the
Board of Directors are put to vote. In the case of equal affirmative and Board of Directors are put to vote.
dissenting votes, the Chairman has the right to cast one more vote.
6.2 The provisions of Article 5.1.3 of these Articles concerning directors' 6.2 The provisions of Article 5.1.4 of these Articles concerning directors'
duties of loyalty and Items (IV) to (VI) of Article 5.1.4 concerning the duties of loyalty and Items (IV) to (VI) of Article 5.1.5 concerning the
duties of diligence shall also apply to senior executives. duties of diligence shall also apply to senior executives.
6.3 A person holding a position, other than a director or supervisor, in the 6.3 A person holding other administrative position, other than a director or
organization of the controlling shareholder or the actual controller of the supervisor, in the organization of the controlling shareholder or the actual
Company, cannot become a senior executive of the Company. controller of the Company, cannot become a senior executive of the Company.
6.10 A director or other senior executive of the Company may also act as the Deleted. Serial numbers 6.11-6.13 are changed to 6.10-6.12 sequentially.
Secretary of the Board of Directors. Accountants from accounting firms
employed by the Company shall not serve as the Secretary of the Board of
Directors of the Company concurrently.
Where the Secretary of the Board of Directors concurrently serves as a
director and a certain action shall be performed by the director and the
Secretary of the Board of Directors respectively, the person concurrently
serving as the director and the Secretary of the Board of Directors shall not
perform this action in a dual capacity.
7.2.1 The Company shall have a Supervisory Committee. The Supervisory 7.2.1 The Company shall have a Supervisory Committee. The Supervisory
Committee shall be composed of three supervisors, including shareholder Committee shall be composed of three supervisors, including shareholder
representatives and an appropriate proportion of employee representatives of representatives and an appropriate proportion of employee representatives of
the Company. The Supervisory Committee shall have one Chairman of the the Company. The Supervisory Committee shall have one Chairman of the
Supervisory Committee, who shall be elected by more than half of all Supervisory Committee, who shall be elected by more than half of all
supervisors. The Chairman of the Supervisory Committee shall convene and supervisors. The Chairman of the Supervisory Committee shall convene and
preside over the meeting of the Supervisory Committee. If the Chairman is preside over the meeting of the Supervisory Committee. If the Chairman is
unable to or fails to perform his/her duties, such meeting shall be convened unable to or fails to perform his/her duties, such meeting shall be convened
and presided over by other supervisors. and presided over by a supervisor nominated by more than half of the
supervisors.
9.1.1 Any person may not serve as the director, the supervisor, or the senior 9.1.1 Any person may not serve as the director, the supervisor, or the senior
executive of the Company if such person: executive of the Company if such person:
(I) has no or limited capacity for civil conduct; (I) has no or limited capacity for civil conduct;
(II) has been sentenced to prison for embezzlement, bribery, conversion of (II) has been sentenced to prison for embezzlement, bribery, conversion of
property, misappropriation of property, or sabotage of social economic order, property, misappropriation of property, or sabotage of social economic order,
and less than five years have elapsed since the expiration of the execution and less than five years have elapsed since the expiration of the execution
time; or deprived of political rights as a result of a criminal conviction, time; or deprived of political rights as a result of a criminal conviction,
and less than five years have elapsed since the expiration of the execution and less than five years have elapsed since the expiration of the execution
time; time;
(III) has served as a director, a factory chief, or the general manager of a (III) has served as a director, a factory chief, or the general manager of a
company or enterprise that underwent bankruptcy liquidation as a result of company or enterprise that underwent bankruptcy liquidation as a result of
mismanagement and has been personally responsible for such bankruptcy, and mismanagement and has been personally responsible for such bankruptcy, and
completion of the bankruptcy liquidation is less than three years ago; completion of the bankruptcy liquidation is less than three years ago;
(IV) has served as the legal representative of a company or enterprise whose (IV) has served as the legal representative of a company or enterprise whose
business license is revoked due to violation of laws, and has been personally business license is revoked due to violation of laws, and has been personally
liable for the revocation, and such revocation occurred less than three years liable for the revocation, and such revocation occurred less than three years
ago; ago;
(V) has a considerately large amount of personal debt which is due and (V) has a considerately large amount of personal debt which is due and
(VI) has been placed on file for investigation by judicial organs for (VI) has been prohibited by the China Securities Regulatory Commission from
violating the Criminal Law, and the case has not yet been closed; serving as directors, supervisors, and senior executives in listed companies,
and the prohibition term has not yet expired;
(VII) has been prohibited from entry into the securities market by the China
Securities Regulatory Commission, and the prohibition period has not expired; (VII) is publicly recognized by any stock exchange as unfit to be directors,
supervisors, or senior executives of listed companies, and the term has not
(VIII) has been banned from being senior management of an enterprise by laws yet expired;
and administrative regulations;
(XI) Other contents stipulated by laws, administrative regulations, or
(IX) is a non-natural person; departmental rules.
(X) has been ruled by the relevant competent authority to violate the For directors, supervisors, or senior executives elected, delegated, or
provisions of relevant securities laws and regulations and to involve employed in violation of previous provisions, such election, delegation or
fraudulent or dishonest acts, and the period since the date of the ruling is employment is null and void. In case any circumstance as set forth in this
less than five years; Article occurs to directors, supervisors, or senior executives during their
terms of office, the Company shall remove them.
(XI) Other contents stipulated by laws, administrative regulations, or
departmental rules.
For directors, supervisors, or senior executives elected, delegated, or
employed in violation of previous provisions, such election, delegation or
employment is null and void. In case any circumstance as set forth in this
Article occurs to directors, supervisors, or senior executives during their
terms of office, the Company shall remove them.
10.1.2 The Company shall submit and disclose annual reports to the China 10.1.2 The Company shall disclose an annual report within four (4) months from
Securities Regulatory Commission and the Shanghai Stock Exchange within four the end of each fiscal year, a semiannual report within two (2) months from
(4) months from the end of each fiscal year, submit and disclose interim the end of the first half of each fiscal year, and quarterly reports within
reports to the dispatched offices of the China Securities Regulatory one (1) month from the end of the first three and nine months of each fiscal
Commission and the Shanghai Stock Exchange within two (2) months from the end year.
of the first half year of each fiscal year. The above annual reports and
interim reports shall be prepared according to the relevant laws, The above annual, semiannual, and quarterly reports shall be prepared
administrative regulations, and regulations specified by the China Securities according to the relevant laws, administrative regulations, and regulations
Regulatory Commission and the Shanghai Stock Exchange. specified by the China Securities Regulatory Commission and the Shanghai Stock
Exchange.
10.1.8 The Company's profit distribution policy is: 10.1.8 The Company's profit distribution policy is:
(I) Profit distribution principle (I) Profit distribution principle
In the distribution of profits, the Company shall focus on the reasonable In the distribution of profits, the Company should focus on the reasonable
return on investment of investors and strive to maintain the continuity and return on investment of investors and strive to maintain the continuity and
stability of the profit distribution policy, ensure sustainable development, stability of the profit distribution policy, ensure sustainable development,
and safeguard the interest of shareholders. and safeguard the interest of shareholders.
The Company's profit distribution shall not exceed the range of accumulated The Company's profit distribution shall not exceed the range of accumulated
distributable profits and shall not damage the Company's ability of going distributable profits and shall not damage the Company's ability of going
concern. concern.
(II) Profit distribution form (II) Profit distribution form
The Company distributes profits by cash, stock, combination of cash and stock, The Company distributes profits by cash, stock, combination of cash and stock,
or other reasonable means in line with laws and administrative regulations. or other reasonable means in line with laws and administrative regulations.
The Company gives priority to the profit distribution method of cash The Company gives priority to the profit distribution method of cash
dividends. dividends.
When distributing profits in cash, the Company shall fully consider the When distributing profits in cash, the Company shall fully consider the
capital needs of daily production and operation activities and investment capital needs of daily production and operation activities and investment
activities in the future as well as the cost and efficiency of financing from activities in the future as well as the cost and efficiency of financing from
banks and securities markets in the future to ensure that the distribution banks and securities markets in the future to ensure that the distribution
plan does not affect the Company's going concern and development. plan does not affect the Company's going concern and development.
When distributing profits through stocks, the Company shall fully consider When distributing profits through stocks, the Company shall fully consider
real and reasonable factors such as the Company's growth and the dilution of real and reasonable factors such as the Company's growth and the dilution of
net assets per share and compatibility of total shares after profit net assets per share and compatibility of total shares after profit
distribution with the Company's scale of operation to ensure that the distribution with the Company's scale of operation to ensure that the
distribution plan is in line with the overall interests of shareholders of the distribution plan is in line with the overall interests of shareholders of the
Company. Company.
(III) Specific conditions and proportions for cash dividends (III) Specific conditions and proportions for cash dividends
Under the condition that the Company is profitable in the current year and has Under the condition that the Company is profitable in the current year and has
no unrecovered losses, if there are no major investment plans or major cash no unrecovered losses, if there are no major investment plans or major cash
expenditures, the Company shall distribute dividends in cash. expenditures, the Company shall distribute dividends in cash.
Major investment plans or major cash expenditures refer to that the Company Major investment plans or major cash expenditures refer to that the Company
plans to invest abroad, acquire assets, or purchase equipment in the next 12 plans to invest abroad, acquire assets, or purchase equipment in the next 12
months (except for the items of raised funds), and the accumulated expenditure months (except for the items of raised funds), and the accumulated expenditure
reaches or exceeds 30% of the latest audited net assets of the Company or a reaches or exceeds 30% of the latest audited net assets of the Company or a
single cash expenditure item exceeds RMB 500 million. single cash expenditure item exceeds RMB 500 million.
The profits accumulatively distributed in cash by the Company in recent three The profits accumulatively distributed in cash by the Company in recent three
years are no less than thirty percent of the average annual profits available years are no less than thirty percent of the average annual profits available
for distribution in recent three years. for distribution in recent three years.
(IV) Specific conditions for issuing stock dividends (IV) Specific conditions for issuing stock dividends
On the basis of giving priority to cash dividends, when the Company is in good On the basis of giving priority to cash dividends, when the Company is in good
operating condition and the scale of share capital is reasonable, and the operating condition and the scale of share capital is reasonable, and the
Board of Directors of the Company thinks that issuing stock dividends is Board of Directors of the Company thinks that issuing stock dividends is
beneficial to the growth of the Company and the interests of all shareholders, beneficial to the growth of the Company and the interests of all shareholders,
a stock dividend distribution plan can be put forward. a stock dividend distribution plan can be put forward.
(V) Interval between profit distribution periods (V) Interval between profit distribution periods
The Company shall put forward a profit distribution plan at the annual meeting The Company shall put forward a profit distribution plan at the annual meeting
of the Board of Directors and implement it after being approved by the General of the Board of Directors and implement it after being approved by the General
Meeting of Shareholders. Meeting of Shareholders.
Under the condition of meeting the aforesaid cash dividend, the Company shall Under the condition of meeting the aforesaid cash dividend, the Company shall
make a cash dividend once a year. According to the Company's profitability and make a cash dividend once a year. According to the Company's profitability and
capital demand, and upon the proposal of the Company's Board of Directors and capital demand, and upon the proposal of the Company's Board of Directors and
the approval of the General Meeting of Shareholders, medium-term cash the approval of the General Meeting of Shareholders, medium-term cash
dividends may also be distributed. dividends may also be distributed.
(VI) The Board of Directors of the Company shall distinguish the following (VI) The Board of Directors of the Company shall distinguish the following
cases and put forward differentiated cash dividends policies according to the cases and put forward differentiated cash dividends policies according to the
procedures specified in these Articles by considering its industrial procedures specified in these Articles by considering its industrial
characteristics, development stage, business model, profitability, and major characteristics, development stage, business model, profitability, debt
capital expenditure arrangement: repayment ability, major capital expenditure arrangement, and investor
returns:
1. If the Company is at a mature development stage, without major capital
expenditure arrangement, cash dividends shall account for at least 80% of the 1. If the Company is at a mature development stage, without major capital
distributed profits in this profit distribution; expenditure arrangement, cash dividends shall account for at least 80% of the
distributed profits in this profit distribution;
2. If the Company is at a mature development stage, with a major capital
expenditure arrangement, cash dividends shall account for at least 40% of the 2. If the Company is at a mature development stage, with a major capital
distributed profits in this profit distribution; expenditure arrangement, cash dividends shall account for at least 40% of the
distributed profits in this profit distribution;
3. If the Company is at the growth stage and has some significant fund
expenditure arrangement, cash dividend shall at least account for 20% of this 3. If the Company is at the growth stage and has some significant fund
profit distribution at the time of profit distribution. expenditure arrangement, cash dividend shall at least account for 20% of this
profit distribution at the time of profit distribution.
The development phase where the Company is at during the dividend shall be
determined by the Board of Directors based on the specific situation. If the The development phase where the Company is at during the dividend shall be
actual development stage of the Company cannot be identified, and the Company determined by the Board of Directors based on the specific situation. If the
has a major capital expenditure arrangement, it is still allowed to make actual development stage of the Company cannot be identified, and the Company
decisions based on the provisions of (III). has a major capital expenditure arrangement, it is still allowed to make
decisions based on the provisions of (III).
(VII) If the profit distribution policy is adjusted due to the needs of the
Company's production and operation and long-term development, the interests of (VII) If the profit distribution policy is adjusted due to the needs of the
shareholders shall be first protected. The adjusted profit distribution policy Company's production and operation and long-term development, the interests of
shall not violate the relevant laws, regulations, normative documents, and the shareholders shall be first protected. The adjusted profit distribution policy
relevant provisions of these Articles. The adjustment plan of the profit shall not violate the relevant laws, regulations, normative documents, and the
distribution policy shall seek the opinions of independent directors and relevant provisions of these Articles. The adjustment plan of the profit
supervisors in advance, and be submitted to the General Meeting of distribution policy shall seek the opinions of supervisors in advance and be
Shareholders for deliberation after being reviewed and approved by the Board submitted to the General Meeting of Shareholders for deliberation after being
of Directors. Independent directors shall express their independent opinions, reviewed and approved by the Board of Directors, which shall be approved by
which shall be approved by more than two-thirds of the voting rights held by more than two-thirds of the voting rights held by shareholders attending the
shareholders attending the General Meeting of Shareholders. General Meeting of Shareholders.
(VIII) The percentage of cash dividend accounts for in this profit (VIII) The percentage of cash dividend accounts for in this profit
distribution shall be obtained by making cash dividend divided by the sum of distribution shall be obtained by making cash dividend divided by the sum of
cash dividend and stock dividend. cash dividend and stock dividend.
10.1.9 Profit distribution procedures of the Company 10.1.9 Profit distribution procedures of the Company
(I) Before the announcement of a regular report, the Board of Directors will (I) Before the announcement of a regular report, the Board of Directors will
explore and formulate the annual profit distribution plan based on the explore and formulate the annual profit distribution plan based on the
Articles of Association and the Company's operational status. When the Company Articles of Association and the Company's operational status. When the Company
prepares a cash dividend plan, the Board of Directors shall carefully explore prepares a cash dividend plan, the Board of Directors shall carefully explore
and demonstrate the opportunity, conditions, minimum proportion, conditions of and demonstrate the opportunity, conditions, minimum proportion, conditions of
adjustment, and decision-making procedure requirements of cash dividends. The adjustment, and decision-making procedure requirements of cash dividends. The
Board of Directors shall form the annual profit distribution plan on the basis Board of Directors shall form the annual profit distribution plan on the basis
of considering the sustained, robust, and scientific returns to all of considering the sustained, robust, and scientific returns to all
shareholders, the independent directors shall express independent opinions, shareholders and the plan shall be submitted to the General Meeting of
and the plan shall be submitted to the General Meeting of Shareholders for Shareholders for approval after being deliberated and approved by the Board of
approval after being deliberated and approved by the Board of Directors. Directors.
The independent director may solicit the opinions of the minority If independent directors believe that the specific plan for cash dividends may
shareholders, propose a dividend plan, and submit it to the Board of Directors harm the rights and interests of the Company or minority shareholders, they
for discussion. have the right to express independent opinions. If the Board of Directors has
not adopted or fully adopted the opinions of independent directors, the
(II) In the process of decision-making and demonstration of the profit opinions of independent directors and the specific reasons for not adopting
distribution plan, the Board of Directors should actively communicate with them shall be recorded in the resolution of the Board of Directors and
shareholders, especially small and medium shareholders, through various disclosed.
channels, fully listen to the opinions and demands of small and medium
shareholders, and answer the concerns of small and medium shareholders in a The independent director may solicit the opinions of the minority
timely manner. shareholders, propose a dividend plan, and submit it to the Board of Directors
for discussion.
(III) When a resolution on the profit distribution plan is passed at the
General Meeting of Shareholders, the Board of Directors shall complete such (II) In the process of decision-making and demonstration of the profit
distribution of dividends (or shares) within two (2) months after the General distribution plan, the Board of Directors should actively communicate with
Meeting of Shareholders is held. shareholders, especially small and medium shareholders, through various
channels, fully listen to the opinions and demands of small and medium
shareholders, and answer the concerns of small and medium shareholders in a
timely manner.
(III) When a resolution on the profit distribution plan is passed at the
General Meeting of Shareholders, the Board of Directors shall complete such
distribution of dividends (or shares) within two (2) months after the General
Meeting of Shareholders is held.
10.3.1 The Company shall employ an accounting firm that complies with 10.3.1 The Company shall engage an accounting firm meeting the
the provisions of the Securities Law to carry out financial statement requirements of Securities Law for the audit of the accounting statements,
auditing, net asset verification, and other related consultation services. The verification of net assets, and other relevant consultation services, etc. The
employment term of the accounting firm shall be one (1) year from the end of employment term of the accounting firm shall be one (1) year and may be
this Annual General Meeting of Shareholders to the end of the next Annual renewed.
General Meeting of Shareholders and may be renewed.
10.3.4 The audit fees of the accounting firm or the method of 10.3.4 The audit fees of the accounting firm or the method of
determining audit fees shall be decided by the General Meeting of determining audit fees shall be decided by the General Meeting of
Shareholders. The remuneration of the accounting firm employed by the Board of Shareholders.
Directors shall be determined by the Board of Directors.
10.3.5 The accounting firm employed by the Company shall enjoy the Deleted.
following rights:
(I) Inspect the Company's books, records, or vouchers at any time, and require
the Company's directors, managers, or other senior executives to provide
relevant materials and explanations;
(II) Require the Company to take all reasonable measures to obtain from its
subsidiaries such materials and explanations as may be necessary for the
accounting firm to perform its duties;
(III) Attend the General Meeting of Shareholders, get any notice of the
meeting or other information relating to the meeting that any shareholder is
entitled to get, and make a speech at any General Meeting of Shareholders on
matters relating to its role as an accounting firm of the Company.
10.3.6 In the case of a vacancy in an accounting firm, the Board of Deleted.
Directors could appoint another accounting firm to fill the vacancy before the
General Meeting of Shareholders. But if the vacancy lasts and the Company has
another in-service accounting firm, such another accounting firm could still
perform its duties.
10.3.7 Regardless of the terms of the contract concluded between the Deleted. Serial number 10.3.8 is changed to 10.3.5.
accounting firm and the Company, the General Meeting of Shareholders may
decide to dismiss the accounting firm by ordinary resolution before the
expiration of the term of office of any accounting firm. Where the accounting
firm has the right to claim compensation from the Company due to dismissal,
the right shall not be affected thereby.
12.2.3 Where the Company is dissolved under Items (I), (II), (V), or (VI) of 12.2.3 Where the Company is dissolved under Items (I), (II), (V), or (VI) of
Article 12.2.1 of these Articles, a liquidation group shall be established to Article 12.2.1 of these Articles, a liquidation group shall be established to
commence the liquidation within 15 days after a cause of dissolution occurs. commence the liquidation within 15 days after a cause of dissolution occurs.
The liquidation group shall be composed of members determined by the Board of The liquidation group shall be composed of members determined by the Board of
Directors or the General Meeting of Shareholders. Where a liquidation group Directors or the General Meeting of Shareholders. Where a liquidation group
has not been formed to carry out liquidation within the specified time limit, has not been formed to carry out liquidation within the specified time limit,
the creditors may apply to the people's court for its designation of relevant the creditors may apply to the people's court for its designation of relevant
personnel to form a liquidation group and carry out liquidation. personnel to form a liquidation group and carry out liquidation.
If the Company is dissolved due to Item (IV) of Article 12.2.1, the People's If the Company is dissolved due to Item (IV) of Article 12.2.1, the People's
Court shall organize shareholders, the relevant authorities, and professionals Court shall organize shareholders, the relevant authorities, and professionals
to establish a liquidation group to carry out liquidation according to the to establish a liquidation group to carry out liquidation according to the
relevant laws. relevant laws.
If the Company is dissolved due to Item (V) of Article 12.2.1, the relevant If the Company is dissolved due to Item (V) of Article 12.2.1, the relevant
competent authorities shall organize shareholders, relevant authorities, and competent authorities shall organize shareholders, relevant authorities, and
relevant professionals to establish a liquidation group for liquidation. relevant professionals to establish a liquidation group for liquidation.
12.2.9 After the liquidation, the liquidation group shall make a liquidation 12.2.9 Upon completion of the liquidation of the Company, the liquidation
report, a statement of income and expenditure during the liquidation, and group shall prepare a liquidation report, submit it to the General Meeting of
financial books, have them verified by Chinese CPAs, and then submit to the Shareholders or the People's Court for confirmation, submit it to the company
General Meeting of Shareholders or the People's Court for confirmation. The registration authority to apply for the cancellation of company registration,
liquidation group shall, within thirty (30) days from the date of confirmation and announce the termination of the Company.
by the General Meeting of Shareholders or the People's Court, submit the
aforementioned documents to the company registration authority to apply for
the cancellation of company registration, and announce the termination of the
Company.
13.6 Amendments to the Articles of Association, if involving the Essential 13.6 Amendments to the Articles of Association, if involving the Trial
Articles, shall take effect after being approved by the company examination Administrative Measures of Overseas Securities Offering and Listing by
and approval authority authorized by the State Council and the securities Domestic Companies, shall take effect after being approved by the company
regulatory body under the State Council. Where the registration of the Company examination and approval authority authorized by the State Council and the
is involved, the registration changes shall be handled according to law. securities regulatory body under the State Council. Where the registration of
the Company is involved, the registration changes shall be handled according
to law.
15.1 Interpretation 15.1 Interpretation
(I) The controlling shareholder refers to a shareholder who meets one of the (I) Controlling shareholder refers to a shareholder whose shares account for
following conditions: (1) a shareholder who can elect more than half of the over 50% of the Company's total equity or a shareholder who holds less than
directors when acting alone or acting in concert with others; (2) a 50% of the shares but whose voting right is sufficient to have a significant
shareholder who can exercise more than 30% (inclusive) of the voting rights of impact on the resolutions of the General Meeting of Shareholders.
the Company or can control the exercise of more than 30% (inclusive) of the
voting rights of the Company when acting alone or acting in concert with (II) The term "actual controller" refers to a person who, though not a
others; (3) a shareholder who holds more than 30% (inclusive) of the shares shareholder of the Company, can actually control the Company's behavior
issued by the company when acting alone or acting in concert with others; (4) through investment relationships, agreements, or other arrangements.
a shareholder who controls the Company in fact in other ways when acting alone
or acting in concert with others. (III) Affiliation refers to relations between the Company's controlling
shareholder, actual controller, directors, supervisors, senior executives, and
(II) The term "actual controller" refers to a person who, though not a the enterprises indirectly or directly controlled by them or other relations
shareholder of the Company, can actually control the Company's behavior that may result in the transfer of the Company's interests. However, no
through investment relationships, agreements, or other arrangements. affiliation is established between state-holding enterprises due to joint
control by the state.
(III) Affiliation refers to relations between the Company's controlling
shareholder, actual controller, directors, supervisors, senior executives, and
the enterprises indirectly or directly controlled by them or other relations
that may result in the transfer of the Company's interests. However, no
affiliation is established between state-holding enterprises due to joint
control by the state.
15.4 In terms of figures, when using following words such as "above", "within" 15.4 In terms of figures, when using following words such as "above", "within"
and "less than" in these Articles, such figures shall be included; when using and "less than" in these Articles, such figures shall be included; when using
following words such as "under", "beyond", "below" and "exceeding", such following words such as "under", "beyond", "below", "exceeding", and "over",
figures shall be excluded. such figures shall be excluded.
The above proposal has been deliberated and approved at the 28th Meeting of
the Twelfth Board of Directors on May 29, 2024, and it is hereby presented to
you for deliberation and approval (as special resolution).
Proposal VII
SDIC Power Holdings Co., Ltd.
The Proposal on Amending the Rules of Procedure
of the General Meeting of Shareholders
Dear shareholders and shareholder representatives:
Based on the operation context, the Company proposed to amend the Rules of
Procedure of the General Meeting of Shareholders according to the
Administrative Measures for Independent Directors of Listed Companies, the
Guidelines for Articles of Association of Listed Companies (Revised in 2022),
the Guidelines No. 1 of Shanghai Stock Exchange for Self-regulation of Listed
Companies - Standardized Operation (Revised in December 2023), the Rules of
the General Meeting of Shareholders of Listed Companies (Revised in 2022),
other regulations and the Articles of Association, with details as follows:
Existing provision Amended provisions
(The amended or added contents are
indicted by underline and bold)
Article 1 To ensure the legality of procedures and resolutions, improve the Article 1 To ensure the legality of procedures and resolutions, improve the
deliberation efficiency of the General Meeting of Shareholders, and safeguard deliberation efficiency of the General Meeting of Shareholders, and safeguard
the legitimate rights and interests of shareholders, the General Meeting of the legitimate rights and interests of shareholders, the General Meeting of
Shareholders formulates these Rules according to the Company Law of the Shareholders formulates these Rules according to the Company Law of the
People's Republic of China (hereinafter referred to as the "Company Law"), the People's Republic of China (hereinafter referred to as the "Company Law"), the
Rules of the General Meeting of Shareholders of Listed Companies (hereinafter Rules of the General Meeting of Shareholders of Listed Companies (hereinafter
referred to as the "Rules of the General Meeting of Shareholders"), the referred to as the "Rules of the General Meeting of Shareholders"), the Trial
Essential Articles of Association for Overseas Listed Companies, and other Administrative Measures of Overseas Securities Offering and Listing by
relevant laws, regulations, and regulatory documents, as well as the Articles Domestic Companies (hereinafter referred to as the "Trial Administrative
of Association of SDIC Power Holdings Co., Ltd. (hereinafter referred to as Measures"), and other relevant laws, regulations, and regulatory documents, as
the "Articles of Association"). well as the Articles of Association of SDIC Power Holdings Co., Ltd.
(hereinafter referred to as the "Articles of Association").
The General Meeting of Shareholders is divided into Annual General Meeting of The General Meeting of Shareholders is divided into Annual General Meeting of
Shareholders and Extraordinary General Meeting of Shareholders. The Annual Shareholders and Extraordinary General Meeting of Shareholders. The Annual
General Meeting of Shareholders shall be held annually within six (6) months General Meeting of Shareholders shall be held annually within six (6) months
after the end of the preceding fiscal year. after the end of the preceding fiscal year.
In case of any one of the following circumstances, the Company shall hold an In case of any one of the following circumstances, the Company shall hold an
Extraordinary General Meeting of Shareholders within two (2) months from the Extraordinary General Meeting of Shareholders within two (2) months from the
date of occurrence of the relevant fact: date of occurrence of the relevant fact:
(I) The number of directors is less than six; (I) The number of directors is less than six;
(II) The Company's unrecovered losses reach one-third of the total share (II) The Company's unrecovered losses reach one-third of the total share
capital; capital;
(III) Shareholder(s) who individually or jointly hold more than ten percent of (III) Shareholder(s) who individually or jointly hold more than ten percent of
the Company's voting shares (hereinafter referred to as the "proposing the Company's shares make(s) a request to hold such a meeting;
shareholder(s)") make(s) a written request in writing to hold such a meeting;
(IV) The Board of Directors deems it necessary to convene such a meeting;
(IV) The Board of Directors deems it necessary to convene such a meeting;
(V) The Supervisory Committee proposes to convene such a meeting;
(V) The Supervisory Committee proposes to convene such a meeting;
(VI) Such a meeting is required in other circumstances prescribed by laws,
(VI) Such a meeting is required in other circumstances prescribed by laws, administrative regulations, and departmental rules or the Articles of
administrative regulations, and departmental rules or the Articles of Association.
Association.
The number of shares held as mentioned in Item (III) above shall be calculated
on the date when the shareholders make a written request.
Article 8 Independent directors have the right to propose to the Board of Article 8 With the consent of more than half of all independent directors,
Directors for an extraordinary General Meeting of Shareholders. The Board of independent directors have the right to propose to the Board of Directors to
Directors shall, subject to provisions of laws, administrative regulations, convene an extraordinary General Meeting of Shareholders. Where independent
and the Articles of Association, give a written response to agree or disagree directors exercise such right of proposal, the Company shall disclose
to hold an extraordinary General Meeting of Shareholders within ten (10) days promptly. Where the above-mentioned right cannot be normally exercised, the
after its receipt of the proposal for the extraordinary General Meeting of Company shall disclose the specific circumstances and reasons. The Board of
Shareholders by independent directors. Directors shall, subject to provisions of laws, administrative regulations,
and the Articles of Association, give a written response to agree or disagree
Where the Board of Directors agrees to convene an extraordinary general to hold an extraordinary General Meeting of Shareholders within ten (10) days
meeting of shareholders, the notice of convening the extraordinary general after its receipt of the proposal for the extraordinary General Meeting of
meeting of shareholders will be issued within five days after the resolution Shareholders by independent directors.
of the Board of Directors is made. Where the Board of Directors does not agree
to convene an extraordinary general meeting of shareholders, it shall explain Where the Board of Directors agrees to convene an extraordinary general
the reasons and make an announcement. meeting of shareholders, the notice of convening the extraordinary general
meeting of shareholders will be issued within five days after the resolution
of the Board of Directors is made. Where the Board of Directors does not agree
to convene an extraordinary general meeting of shareholders, it shall explain
the reasons and make an announcement.
Article 15 Where the Company convenes the General Meeting of Shareholders, the Article 15 Where the Company convenes the General Meeting of Shareholders, the
Board of Directors, the Supervisory Committee, and the shareholder Board of Directors, the Supervisory Committee, and the shareholder
individually or jointly holding more than 3% of shares of the Company shall be individually or jointly holding more than 3% of shares of the Company shall be
entitled to bring forward proposals at the General Meeting of Shareholders. entitled to bring forward proposals at the General Meeting of Shareholders.
Where a qualified shareholder submits a provisional proposal prior to the Where a qualified shareholder submits a provisional proposal prior to the
general meeting of shareholders, the percentage of shares held between the general meeting of shareholders, the percentage of shares held between the
issuance of the notice of the proposal and the announcement of the resolution issuance of the notice of the proposal and the announcement of the resolution
of the meeting shall not be less than three percent. of the meeting shall not be less than three percent.
Shareholders individually or jointly holding not less than three percent of Where a shareholder proposes a provisional proposal, it shall provide the
the Company's shares may submit a provisional proposal to the convener in convener with the certification documents for holding more than three percent
writing ten (10) days prior to the date of the general meeting of of the shares of the listed company. Where a shareholder jointly proposes a
shareholders. The convener shall issue a supplementary notice of the general proposal by way of entrustment, the entrusting shareholder shall issue a
meeting of shareholders to announce the content of the provisional proposal written authorization document to the entrusted shareholder.
within two days after receiving the proposal.
Shareholders individually or jointly holding not less than three percent of
the Company's shares may submit a provisional proposal to the convener in
writing ten (10) days prior to the date of the general meeting of
shareholders. The convener shall issue a supplementary notice of the general
meeting of shareholders to announce the content of the provisional proposal
within two days after receiving the proposal.
Except for provisional proposals, it is not allowed to modify the proposals
listed in the notice of the General Meeting of Shareholders or add new
proposals after the Company issues the notice of the General Meeting of
Shareholders.
Article 18 The notice of the General Meeting of Shareholders shall comply with Article 18 The notice of the General Meeting of Shareholders shall include the
the following requirements: following:
(I) The notice shall be in writing; (I) Date, place, and duration of the meeting;
(II) The notice shall designate the time, place, and duration of the meeting; (II) Matters and proposals to be discussed at the meeting;
(III) The notice shall state the matters and proposals to be discussed at the (III) A statement in clear words that: all shareholders have the right to
meeting; attend the General Meeting of Shareholders, or may attend and vote in the
meeting by proxy in written form, who may not necessarily be the shareholder
(IV) The notice shall provide the shareholders with materials and explanations of the Company;
needed by them for making informed decisions on the matters for review,
including but not limited to providing the specific conditions and contract (IV) The date of equity registration for shareholders entitled to attend the
(if any) of the proposed transactions when the Company proposes the General Meeting of Shareholders;
consolidation, share repo, capital stock reorganization or other
reorganization, and explaining the cause and consequence in details; ( V) Name and telephone number of the standing contact person for the meeting;
(V) If any directors, supervisors, the general manager, or other senior (VI) Voting time and voting procedures by online or other means.
executives are materially interested in the matters to be discussed, the
nature and degree of the interest shall be disclosed; if the effect of the The notice and supplementary notice of the general meeting of shareholders
matters to be discussed on such directors, supervisors, the general manager, shall fully and completely disclose the specific contents of all the
or other senior executives as shareholders is different from that on other proposals. If the independent directors shall give comments on matters
similar shareholders, a detailed explanation shall be given; proposed to be discussed, the comments and reasons of the independent
directors shall be disclosed when the notice or supplemental notice of the
(VI) The notice shall bear the full text of any special resolution to be general meeting of shareholders is given.
passed at the meeting;
The starting time of online vote or other ways of voting of the General
(VII) The notice shall have a statement in clear words that: all shareholders Meeting of Shareholders shall not be earlier than 3:00 p.m. of the date before
have the right to attend the General Meeting of Shareholders, or may attend the on-site convening of the General Meeting of Shareholders and later than
and vote in the meeting by proxy in written form, who may not necessarily be 9:30 a.m. of the date of on-site convening of the meeting, while the ending
the shareholder of the Company; time shall not be before 3:00 p.m. of the date when the on-site General
Meeting of Shareholders ends.
(VIII) The notice shall state the time and place for delivery of the meeting
vote proxy;
(IX) The note shall designate the date of equity registration for shareholders
entitled to attend the General Meeting of Shareholders;
(X) The note shall specify the name and telephone number of the standing
contact person for the meeting.
(XI) The notice shall specify the voting time and voting procedures by online
or other means.
Article 22 The methods and procedures for proposing candidates of directors, Article 22 The methods and procedures for proposing candidates of directors,
independent directors, and supervisors are as follows: independent directors, and supervisors are as follows:
(I) The Board of Directors and shareholder(s) who individually or jointly hold (I) The Board of Directors and shareholder(s) who individually or jointly hold
more than three percent of issued shares of the Company have the right to more than three percent of issued shares of the Company have the right to
nominate director candidates of the Company (excluding employee directors) and nominate director candidates of the Company (excluding independent directors
submit proposals to the General Meeting of Shareholders; the Board of and employee directors) and submit proposals to the General Meeting of
Directors, the Supervisory Committee, and shareholders who individually or Shareholders; the Board of Directors, the Supervisory Committee, and
jointly hold more than one percent of the Company's issued shares have the shareholders who individually or jointly hold more than one percent of the
right to nominate candidates of independent directors of the Company and Company's issued shares have the right to nominate candidates of independent
submit proposals to the General Meeting of Shareholders; directors of the Company and submit proposals to the General Meeting of
Shareholders;
(II) The Supervisory Committee and shareholder(s) who individually or jointly
hold more than three percent of issued shares of the Company have the right to (II) The Supervisory Committee and shareholder(s) who individually or jointly
nominate supervisor candidates of the Company and submit proposals to the hold more than three percent of issued shares of the Company have the right to
General Meeting of Shareholders; nominate supervisor candidates of the Company and submit proposals to the
General Meeting of Shareholders;
(III) The nomination of directors and supervisors by the Board of Directors
and the Supervisory Committee to the General Meeting of Shareholders shall be (III) The nomination of directors and supervisors by the Board of Directors
made through resolutions of the Board of Directors and the Supervisory and the Supervisory Committee to the General Meeting of Shareholders shall be
Committee respectively; made through resolutions of the Board of Directors and the Supervisory
Committee respectively;
(IV) The convener of the General Meeting of Shareholders shall provide the
General Meeting of Shareholders with the resumes and basic information of (IV) The convener of the General Meeting of Shareholders shall provide the
candidates of directors, independent directors, and supervisors, and a General Meeting of Shareholders with the resumes and basic information of
statement indicating that the nominees are not in the situations prescribed in candidates of directors, independent directors, and supervisors, and a
the Company Law that prohibit them from being directors or supervisors. For an statement indicating that the nominees are not in the situations prescribed in
independent director candidate, the convener of the General Meeting of the Company Law that prohibit them from being directors or supervisors. Before
Shareholders shall also explain to the General Meeting of Shareholders whether nominating an independent director candidate, the nominator shall obtain the
the candidate has been objected to by the China Securities Regulatory consent of the nominee. Before the General Meeting of Shareholders for
Commission or the local office of the China Securities Regulatory Commission electing independent directors is convened, a statement disclosing that the
in the place where the Company is located. independent directors meet the qualification requirements shall be disclosed.
For independent director candidates, the convener of the General Meeting of
Shareholders shall submit all relevant materials of the independent director
candidates to the Shanghai Stock Exchange, and explain to the General Meeting
of Shareholders whether any objections have been raised by the Shanghai Stock
Exchange regarding the candidates.
Article 23 If the matters concerning the election of directors and supervisors Article 23 If the matters concerning the election of directors and supervisors
are to be discussed at the General Meeting of Shareholders, the notice of the are to be discussed at the General Meeting of Shareholders, the notice of the
General Meeting of Shareholders shall fully disclose the detailed information General Meeting of Shareholders shall fully disclose the detailed information
of the director and supervisor candidates, including at least the following of the director and supervisor candidates, including at least the following
contents: contents:
(I) Education background, work experience, part-time jobs, and other personal (I) Education background, work experience, part-time jobs, and other personal
information; information;
(II) Whether there is any affiliation to the Company or its controlling (II) Whether there is any affiliation to the directors, supervisors, senior
shareholder and actual controller; executives, actual controller, and shareholders holding more than 5% shares of
the Company;
(III) Disclosure of the number of shares held by the candidate in the Company;
(III) The number of shares held in the Company;
(IV) Whether such candidates are subject to any punishment by the China
Securities Regulatory Commission and other relevant departments and any (IV) Whether any circumstances prohibit such candidates from serving as
disciplinary action by stock exchanges. directors, supervisors, or senior executives according to the Company Law,
other laws and regulations, and other relevant provisions;
In addition to the election of directors and supervisors by accumulative
voting, each director or supervisor candidate shall be put forward by a single (V) Whether such candidates are prohibited by the China Securities Regulatory
proposal. Commission from serving as directors, supervisors, and senior executives in
listed companies, and the prohibition term has not yet expired;
(VI) Whether such candidates are publicly recognized by any stock exchange as
unfit to be directors, supervisors, or senior executives of listed companies,
and the term has not yet expired;
(VII) Other important matters required to be disclosed by the Shanghai Stock
Exchange.
In addition to the election of directors and supervisors by accumulative
voting, each director or supervisor candidate shall be put forward by a single
proposal.
Article 24 The General Meeting of Shareholders shall not be postponed or Article 24 The General Meeting of Shareholders shall not be postponed or
canceled and those proposals as listed in the notice of the General Meeting of canceled and those proposals as listed in the notice of the General Meeting of
Shareholders shall not be canceled without justified reasons after the giving Shareholders shall not be canceled without justified reasons after the giving
of the notice. In case of postponement or cancellation, the convener shall of the notice. In case of postponement or cancellation, the convener shall
proclaim it and explain the reasons at least two (2) working days before the proclaim it and explain the reasons at least two (2) working days before the
originally determined date of the meeting. originally determined date of the meeting. If the general meeting of
shareholders is postponed, the date of the postponed meeting shall also be
disclosed.
Article 30 Any shareholder who has the right to attend and vote at the General Article 30 Any shareholder who has the right to attend and vote at the General
Meeting of Shareholders may attend the General Meeting of Shareholders in Meeting of Shareholders may attend the General Meeting of Shareholders in
person or may appoint one or more persons (who may not be shareholders of the person or may appoint one person (who may not be a shareholder of the Company)
Company) as his/her proxy/proxies and attend or vote at the meeting on his/her as his/her proxy and attend and vote at the meeting on his/her behalf. The
behalf. The shareholder's proxy, under the authorization of such shareholder, shareholder's proxy, under the authorization of such shareholder, may exercise
may exercise the following rights: the following rights:
(I) Exercising the shareholder's right to speak at the general meeting of (I) Exercising the shareholder's right to speak at the general meeting of
shareholders; shareholders;
( II) Requesting on its initiative or jointly with others to vote by poll; (II) Requesting on its initiative or jointly with others to vote by poll.
(III) Voting rights shall be exercised by a show of hands or a poll, but if
more than one shareholder's proxy is appointed, such shareholder's proxy shall
only exercise the voting rights by poll.
Article 39 At the Annual General Meeting of Shareholders, the Board of Article 39 At the Annual General Meeting of Shareholders, the Board of
Directors and the Supervisory Committee shall report work over the previous Directors and the Supervisory Committee shall report work over the previous
year to the General Meeting of Shareholders, and each independent director year to the General Meeting of Shareholders, and each independent director
shall also make a report on their work. shall also submit to the Annual General Meeting of Shareholders an annual
report on his/her performance of duties.
Article 44 There shall be minutes of the General Meeting of Shareholders, Article 44 There shall be minutes of the General Meeting of Shareholders,
which shall be taken by the Secretary of the Board of Directors or her/his which shall be taken by the Secretary of the Board of Directors or her/his
authorized person. The minutes shall record: authorized person. The minutes shall record:
(I) Time, place, agenda, and name of the convener of the meeting; (I) Time, place, agenda, and name of the convener of the meeting;
(II) Names of the meeting moderator and directors, supervisors, the general (II) Names of the meeting moderator and directors, supervisors, the general
manager, and other senior executives present at or attending the meeting; manager, the Secretary of the Board of Directors, and other senior executives
present at or attending the meeting;
(III) Number of shareholders and proxies attending the meeting, total number
of voting shares held by them, and their proportion in the total number of (III) Number of shareholders and proxies attending the meeting, total number
shares of the Company; of voting shares held by them, and their proportion in the total number of
shares of the Company;
(IV) Consideration process, main points of address, and voting results of each
proposal; (IV) Consideration process, main points of address, and voting results of each
proposal;
(V) Inquiries or suggestions raised by shareholders and the corresponding
replies or explanations; (V) Inquiries or suggestions raised by shareholders and the corresponding
replies or explanations;
(VI) Names of the lawyer, vote counter, and scrutineer;
(VI) Names of the lawyer, vote counter, and scrutineer;
(VII) Other information that shall be recorded in the minutes according to
relevant laws and regulations, the Articles of Association, and these rules. (VII) Other information that shall be recorded in the minutes according to
relevant laws and regulations, the Articles of Association, and these rules.
Article 48 Shareholders (including their proxies) will exercise their voting Article 48 Shareholders (including their proxies) will exercise their voting
rights based on the number of voting shares presented, and each share has one rights based on the number of voting shares presented, and each share has one
vote. vote.
There shall be no voting right for the shares of the Company held by the When the General Meeting of Shareholders reviews major matters concerning the
Company itself and such shares shall not be included in the total number of interests of minority investors, the votes of small and medium investors shall
shares with voting rights held by shareholders present at the General Meeting be counted separately. Separate counting results shall be disclosed publicly
of Shareholders. and timely.
Where a shareholder purchases the voting shares of the Company in violation of There shall be no voting right for the shares of the Company held by the
the provisions of Paragraphs 1 and 2 of Article 63 of the Securities Law, the Company itself and such shares shall not be included in the total number of
share exceeding the prescribed proportion shall not exercise the voting rights shares with voting rights held by shareholders present at the General Meeting
within 36 months after purchase, and shall not be included in the total number of Shareholders.
of voting shares attending the General Meeting of Shareholders.
Where a shareholder purchases the voting shares of the Company in violation of
The Board of Directors, independent directors, shareholders holding 1% or more the provisions of Paragraphs 1 and 2 of Article 63 of the Securities Law, the
of the shares with voting rights, or the investor protection institutions share exceeding the prescribed proportion shall not exercise the voting rights
established according to laws, administrative regulations, or the provisions within 36 months after purchase, and shall not be included in the total number
of the China Securities Regulatory Commission may solicit the voting rights of of voting shares attending the General Meeting of Shareholders.
shareholders. To solicit such voting rights is subject to fully disclosing the
specific voting intention and other relevant information to the shareholders The Board of Directors, independent directors, shareholders holding 1% or more
with voting rights being solicited. It is prohibited to solicit the voting of the shares with voting rights, or the investor protection institutions
rights of shareholders for payment or in a disguised form of payment. established according to laws, administrative regulations, or the provisions
of the China Securities Regulatory Commission may solicit the voting rights of
shareholders. No payment shall be made for solicitation of voting rights, and
adequate information shall be provided to persons whose voting rights are
being solicited. It is prohibited to solicit the voting rights of shareholders
for payment or in a disguised form of payment. Except for the statutory
conditions, the Company may not impose the minimum shareholding ratio limit on
the voting right solicitation.
Article 50 Unless otherwise required by the listing rules of the stock Deleted.
exchange on which the Company's shares are listed and/or relevant laws,
regulations, and provisions, or before or after a show of hands the following
persons demand a vote by poll, the General Meeting of Shareholders shall vote
by a show of hands:
(I) The moderator of the meeting;
(II) At least two shareholders or their proxies with voting rights;
(III) One or more shareholders (including their proxies) individually or
collectively holding more than 10% (included) of the voting shares at the
meeting.
Unless a vote by poll is proposed, the moderator of the meeting shall announce
the adoption of the resolution as per the result of a show of hands, which
shall be recorded in the minutes of the meeting as the final basis, without
proving the number of votes for or against the resolution adopted at the
meeting or its proportion. A request for a vote by poll may be withdrawn by
the proposer.
Article 51 If the matter required to be voted on by poll is about electing the Deleted.
moderator or terminating the meeting, voting by poll shall be made
immediately. Other matters required to be voted on by poll shall be determined
by the moderator in terms of the time of voting. The meeting could go on,
other matters could be discussed and the voting result is still deemed as the
resolution approved at such meeting.
Article 52 At the time of vote by poll, shareholders with two or more polls of Deleted.
voting rights (including shareholders' proxies) need not vote for or against
all voting rights.
Article 53 In the case of equal affirmative and dissenting votes, the Deleted. The subsequent serial numbers are adjusted sequentially and Article
shareholder acting as the moderator of the meeting shall have the right to 54 is adjusted to Article 50.
cast one more vote.
Article 55 Resolutions of the General Meeting of Shareholders include ordinary Article 51 Resolutions of the General Meeting of Shareholders include
and special resolutions. ordinary and special resolutions.
Any ordinary resolution of the general meeting of shareholders shall be passed Any ordinary resolution of the General Meeting of Shareholders shall be passed
with more than 1/2 of the voting rights held by the shareholders (including with more than half of the voting rights held by the shareholders (including
shareholders' proxies) who attend the meeting. shareholders' proxies) who attend the meeting.
Any special resolution of the General Meeting of Shareholders shall be passed Any special resolution of the General Meeting of Shareholders shall be passed
with more than two-thirds of the voting rights held by the shareholders with more than two-thirds of the voting rights held by the shareholders
(including shareholders' proxies) who attend the meeting. (including shareholders' proxies) who attend the meeting.
Article 59 When related-party transactions are considered at the General Article 55 When the shareholders are related to the matters to be considered
Meeting of Shareholders, the related shareholders shall recuse themselves from at the General Meeting of Shareholders, the shareholders shall recuse
voting, and the number of voting shares held by them shall not be counted themselves from voting, and the voting shares held by them shall not be
towards the total number of voting shares in the General Meeting of included in the total number of voting shares of shareholders present at the
Shareholders. The announcement of the resolution of the General Meeting of General Meeting of Shareholders. The announcement of the resolution of the
Shareholders shall fully disclose the voting situation of non-related General Meeting of Shareholders shall fully disclose the voting situation of
shareholders. non-related shareholders.
Article 61 The list of director and supervisor candidates shall be proposed to Article 57 The list of director and supervisor candidates shall be proposed to
the General Meeting of Shareholders for voting in the form of a proposal. the General Meeting of Shareholders for voting in the form of a proposal.
When the General Meeting of Shareholders conducts voting to elect the When the General Meeting of Shareholders conducts voting to elect the
directors or supervisors, cumulative voting shall apply according to these directors or supervisors, cumulative voting shall apply according to these
Articles or a resolution of the General Meeting of Shareholders. Articles or a resolution of the General Meeting of Shareholders.
The above-mentioned cumulative voting system means that each share has voting The above-mentioned cumulative voting system means that each share has voting
rights of the same number of directors or supervisors to be elected and voting rights of the same number of directors or supervisors to be elected and voting
rights held by a shareholder can be used in a centralized way in case of rights held by a shareholder can be used in a centralized way in case of
election of directors or supervisors at the General Meeting of Shareholders. election of directors or supervisors at the General Meeting of Shareholders.
Director and supervisor candidates with the most votes shall be elected and Director and supervisor candidates with the most votes shall be elected and
the number of votes cast for the elected directors and supervisors shall the number of votes cast for the elected directors and supervisors shall
exceed 50% (including 50%) of the total shares held by shareholders attending exceed 50% of the total shares held by shareholders attending the General
the General Meeting of Shareholders. Meeting of Shareholders.
To ensure that the election of independent directors meets the regulations, To ensure that the election of independent directors meets the regulations,
the Company conducts separate elections for independent directors and the Company conducts separate elections for independent directors and
non-independent directors, both using the cumulative voting system. The non-independent directors, both using the cumulative voting system. The
specific operation is as follows: In the election of independent directors, specific operation is as follows: In the election of independent directors,
each shareholder present at the meeting is entitled to such number of votes as each shareholder present at the meeting is entitled to such number of votes as
equal to the product of the total number of shares held by it and the number equal to the product of the total number of shares held by it and the number
of independent directors to be elected at the General Meeting of Shareholders, of independent directors to be elected at the General Meeting of Shareholders,
and such votes can only be used for the independent director candidates in the and such votes can only be used for the independent director candidates in the
General Meeting of Shareholders. In the election of non-independent directors, General Meeting of Shareholders. In the election of non-independent directors,
each shareholder present at the meeting is entitled to such number of votes as each shareholder present at the meeting is entitled to such number of votes as
equal to the product of the total number of shares held by it and the number equal to the product of the total number of shares held by it and the number
of non-independent directors to be elected at the General Meeting of of non-independent directors to be elected at the General Meeting of
Shareholders, and such votes can only be used for candidates of Shareholders, and such votes can only be used for candidates of
non-independent directors in the General Meeting of Shareholders. non-independent directors in the General Meeting of Shareholders.
In the election of supervisors in the Company, each shareholder present at the In the election of supervisors in the Company, each shareholder present at the
meeting is entitled to such number of votes as equal to the product of the meeting is entitled to such number of votes as equal to the product of the
total number of shares held by it and the number of supervisors to be elected total number of shares held by it and the number of supervisors to be elected
at the General Meeting of Shareholders, and such votes can only be used for at the General Meeting of Shareholders, and such votes can only be used for
the candidates of supervisors in the General Meeting of Shareholders. the candidates of supervisors in the General Meeting of Shareholders.
If the number of directors or supervisors elected at the General Meeting of If the number of directors or supervisors elected at the General Meeting of
Shareholders falls short of the required number, or if there are multiple Shareholders falls short of the required number, or if there are multiple
candidates with the same number of votes but only one can be elected as a candidates with the same number of votes but only one can be elected as a
director or supervisor, a second round of voting shall be conducted for the director or supervisor, a second round of voting shall be conducted for the
remaining positions until all the required directors and supervisors are remaining positions until all the required directors and supervisors are
elected. During the second round of voting, the total number of voting rights elected. During the second round of voting, the total number of voting rights
of each shareholder participating in the vote is equal to the product of the of each shareholder participating in the vote is equal to the product of the
number of shares held by it and the number of directors or supervisors still number of shares held by it and the number of directors or supervisors still
needed to be elected. Any matters not covered by the cumulative voting method needed to be elected. Any matters not covered by the cumulative voting method
shall be resolved through consultation between the moderator of the meeting shall be resolved through consultation between the moderator of the meeting
and the shareholders attending the meeting. If consensus cannot be reached and the shareholders attending the meeting. If consensus cannot be reached
through consultation, it shall be handled following the opinion passed by the through consultation, it shall be handled following the opinion passed by the
shareholders present at the meeting with half or more of the voting rights. shareholders present at the meeting with more than half of the voting rights.
The Board of Directors shall announce to shareholders the resumes and basic The Board of Directors shall announce to shareholders the resumes and basic
information of the candidate directors and non-employee representative information of the candidate directors and non-employee representative
supervisors to be voted on at the General Meeting of Shareholders. supervisors to be voted on at the General Meeting of Shareholders.
Besides the cumulative voting system, the General Meeting of Shareholders will Besides the cumulative voting system, the General Meeting of Shareholders will
conduct voting on each of the proposals. If different proposals are submitted conduct voting on each of the proposals. If different proposals are submitted
on the same issue, the voting shall be conducted in the chronological order in on the same issue, the voting shall be conducted in the chronological order in
which these proposals have been submitted. In case of interruption of the which these proposals have been submitted. In case of interruption of the
General Meeting of Shareholders or failure to reach a resolution due to General Meeting of Shareholders or failure to reach a resolution due to
unusual reasons such as force majeure, the General Meeting of Shareholders unusual reasons such as force majeure, the General Meeting of Shareholders
shall not leave the proposals suspended or leave them without voting. shall not leave the proposals suspended or leave them without voting.
When the appointment proposal for director and supervisor candidates are being
considered at the General Meeting of Shareholders, they shall personally
attend the meeting and provide clarifications on their abilities to perform
their duties, professional qualifications, work experience, any past illegal
or delinquent conduct, potential conflicts of interest with the listed
company, as well as their relationships with the Company's controlling
shareholder, actual controller, and other directors, supervisors, and senior
executives.
Article 69 The announcement of the resolutions of the General Meeting of Article 65 The announcement of the General Meeting of Shareholders shall set
Shareholders shall specify the number of shareholders (and proxies) present at forth the number of the shareholders and proxies attending the meeting, the
the meeting, the total number of shares held (or represented), and their number of voting shares and their proportion in the total voting shares of the
proportion to the total voting shares of the Company, the voting method, and Company, the voting method, the voting result of each proposal and the details
the detailed results of voting on each proposal. of the approved resolution.
If a proposal is not approved at the meeting, or if a resolution of the If a proposal is not approved at the meeting, or if a resolution of the
previous General Meeting of Shareholders is changed in this General Meeting of previous General Meeting of Shareholders is changed in this General Meeting of
Shareholders, an explanation shall be made in the announcement of the Shareholders, a special prompt shall be made in the announcement of the
resolutions of the General Meeting of Shareholders. resolutions of the General Meeting of Shareholders.
The Company shall announce the resolution of repurchasing ordinary shares on The Company shall announce the resolution of repurchasing ordinary shares on
the day following the General Meeting of Shareholders when such a resolution the day following the General Meeting of Shareholders when such a resolution
is made. is made.
When the Company announces the resolutions of the General Meeting of When the Company announces the resolutions of the General Meeting of
Shareholders, it shall also submit the legal opinion issued by the lawyer Shareholders, it shall also submit the legal opinion issued by the lawyer
invited to attend the meeting to the Shanghai Stock Exchange. If any proposals invited to attend the meeting to the Shanghai Stock Exchange. If any proposals
are rejected or amended during the General Meeting of Shareholders, the full are rejected or amended during the General Meeting of Shareholders, the full
text of the legal opinion shall be disclosed. text of the legal opinion shall be disclosed.
Article 71 After the profit distribution plan and the plan for converting Article 67 If the General Meeting of Shareholders approves proposals on cash
reserve funds into share capital are approved by the General Meeting of dividends, bonus shares, or conversion of capital reserve into share capital,
Shareholders of the Company, the Board of Directors of the Company shall the Company shall implement the specific plans within two months after the
complete the distribution (or conversion) of dividends (or shares) within two conclusion of the General Meeting of Shareholders.
months after the General Meeting of Shareholders is held.
The above proposal has been deliberated and approved at the 28th Meeting of
the Twelfth Board of Directors on May 29, 2024, and it is hereby presented to
you for deliberation and approval (as special resolution).
Proposal VIII
SDIC Power Holdings Co., Ltd.
Proposal on Amending the Rules of Procedure of the Board of Directors
Dear shareholders and shareholders' representatives,
Based on the operation context, the Company proposed to amend the Rules of
Procedure of the Board of Directors according to the Administrative Measures
for Independent Directors of Listed Companies, the Guidelines for Articles of
Association of Listed Companies (Revised in 2022), the Guidelines No. 1 of
Shanghai Stock Exchange for Self-regulation of Listed Companies - Standardized
Operation (Revised in December 2023), other regulations and the Articles of
Association, with details as follows:
Existing provision Amended provisions
(The new content is indicated by underline and bold.)
Article 1 To further standardize the deliberation methods and decision-making Article 1 To further standardize the deliberation methods and decision-making
procedures of the Board of Directors of SDIC Power Holdings Co., Ltd. procedures of the Board of Directors of SDIC Power Holdings Co., Ltd.
(hereinafter referred to as "the Company") and improve the standardized (hereinafter referred to as "the Company") and improve the standardized
operation and scientific decision-making status of the Board of Directors, operation and scientific decision-making status of the Board of Directors,
these Rules are formulated according to the Company Law, the Securities Law, these Rules are formulated according to the Company Law of the People's
the Code of Corporate Governance for Listed Companies, the Rules Governing the Republic of China (hereinafter referred to as the "Company Law"), the
Listing of Stocks on Shanghai Stock Exchange, the Essential Articles of Securities Law of the People's Republic of China (hereinafter referred to as
Association for Overseas Listed Companies, and other laws, regulations, and the "Securities Law"), the Code of Corporate Governance for Listed Companies,
regulatory documents, as well as the Articles of Association of SDIC Power the Rules Governing the Listing of Stocks on Shanghai Stock Exchange
Holdings Co., Ltd. (hereinafter referred to as the "Articles of Association") (hereinafter referred to as the "Stock Listing Rules"), the Trial
in combination with the reality of the Company. Administrative Measures of Overseas Securities Offering and Listing by
Domestic Companies (hereinafter referred to as the "Trial Administrative
Measures"), and other laws, regulations, and regulatory documents, as well as
the Articles of Association of SDIC Power Holdings Co., Ltd. (hereinafter
referred to as the "Articles of Association") in combination with the reality
of the Company.
Article 4 The Board of Directors shall exercise the following powers: Article 4 The Board of Directors should exercise the following powers:
(I) Review and determine the implementation of decisions and arrangements of (I) Review and determine the implementation of decisions and arrangements of
the CPC Central Committee and major initiatives of national development the CPC Central Committee and major initiatives of national development
strategies; strategies;
(II) Convene a General Meeting of Shareholders and report the work to the (II) Convene a General Meeting of Shareholders and report the work to the
General Meeting of Shareholders; General Meeting of Shareholders;
(III) Implement the resolutions of the General Meeting of Shareholders; (III) Implement the resolutions of the General Meeting of Shareholders;
(IV) Formulate the operating policy and investment plan of the Company and (IV) Formulate the operating policy and investment plan of the Company and
decide the Company's business plans and investment plans; decide the Company's business plans and investment plans;
(V) Formulate the annual financial budget plans and final accounting plans of (V) Formulate the annual financial budget plans and final accounting plans of
the Company; the Company;
(VI) Formulate the profit distribution plan, profit distribution policy (VI) Formulate the profit distribution plan, profit distribution policy
adjustment plan, loss recovery plans for the Company; adjustment plan, loss recovery plans for the Company;
(VII) To formulate the plans to increase or decrease registered capital, issue (VII) To formulate the plans to increase or decrease registered capital, issue
bonds or other securities, and list for the Company; bonds or other securities, and list for the Company;
(VIII) Draw up schemes concerning the major purchase, purchase of the (VIII) Draw up schemes concerning major purchase, purchase of the Company's
Company's stocks, or merger, division, dissolution, and alteration of the stocks, or merger, division, dissolution, and alteration of the Company;
Company;
(IX) Deliberate and approve related-party transactions between the Company and
(IX) Deliberate and approve related-party transactions between the Company and related natural persons with a transaction amount of more than RMB 300,000
related natural persons with a transaction amount of more than RMB 300,000 (except for the guarantee provided by the Company, if it meets the criteria
(except for the guarantee provided by the Company, if it meets the criteria for deliberation at the general meeting of shareholders, it shall be submitted
for deliberation at the General Meeting of Shareholders, it shall be submitted to the general meeting of shareholders for deliberation and approval after
to the General Meeting of Shareholders for deliberation and approval after deliberation by the Board of Directors), and deliberate and approve
deliberation by the Board of Directors), and deliberate and approve related-party transactions between the Company and related parties with a
related-party transactions between the Company and related parties with a transaction amount of more than RMB 3 million and accounting for more than
transaction amount of more than RMB 3 million and accounting for more than 0.5% of value of the Company's net assets as audited in the latest term
0.5% of value of the Company's net assets as audited in the latest term (except for the guarantee provided by the Company, if it meets the criteria
(except for the guarantee provided by the Company, if it meets the criteria for deliberation at the general meeting of shareholders, it shall be submitted
for deliberation at the General Meeting of Shareholders, it shall be submitted to the general meeting of shareholders for deliberation and approval after
to the General Meeting of Shareholders for deliberation and approval after deliberation by the Board of Directors).
deliberation by the Board of Directors).
The amount of related-party transactions between the Company and the same
The amount of related-party transactions between the Company and the same affiliated person, or transaction related to the type of transaction object
affiliated person, or transaction related to the type of transaction object between the Company and different affiliated person, will be calculated
between the Company and different affiliated person, will be calculated according to the principles of accumulative calculation for twelve (12)
according to the principles of accumulative calculation for twelve (12) consecutive months;
consecutive months;
(X) Deliberate and approve the guarantees and other transactions that should
(X) Deliberate and approve the guarantees and other transactions that shall be be reviewed by the Board of Directors as stipulated in 5.2.8 of the Articles
reviewed by the Board of Directors as stipulated in 5.2.8 of the Articles of of Association;
Association;
(XI) Decide the establishment of internal management organizations of the
(XI) Decide the establishment of internal management organizations of the Company;
Company;
(XII) Decide on the appointment or dismissal of the Company's general manager,
(XII) Decide on the appointment or dismissal of the Company's general manager, Secretary of the Board of Directors, and other senior executives according to
Secretary of the Board of Directors, and other senior executives according to relevant regulations and procedures, and determine their remuneration,
relevant regulations and procedures, and determine their remuneration, rewards, and punishments; appoint or dismiss the deputy general managers, the
rewards, and punishments; appoint or dismiss the deputy general managers and chief accountant (chief financial officer), and the general counsel according
chief financial officer according to the nomination of general manager and to the nomination of general manager and determine their remuneration,
determine their remuneration, rewards, and punishments; and appoint or dismiss rewards, and punishments.
the Company's general counsel.
(XIII) Formulate the basic management system of the Company;
(XIII) Formulate the basic management system of the Company;
(XIV) Develop the methods of performance evaluation, sign annual and term
(XIV) Develop the methods of performance evaluation, sign annual and term performance responsibility letters with the management members, and
performance responsibility letters with the management members, and scientifically and reasonably determine the performance evaluation results of
scientifically and reasonably determine the performance evaluation results of management members;
management members;
(XV) Develop the salary management measures for senior executives, make the
(XV) Develop the salary management measures for senior executives, make the salary distribution plan for senior executives, and establish and improve the
salary distribution plan for senior executives, and establish and improve the restraint mechanism matching with the incentives of the management members;
restraint mechanism matching with the incentives of the management members;
(XVI) Formulate the revision plan for the Articles of Association;
(XVI) Formulate the revision plan for the Articles of Association;
(XVII) Manage information disclosure matters of the Company;
(XVII) Manage information disclosure matters of the Company;
(XVIII) Propose to the General Meeting of Shareholders the appointment of an
(XVIII) Propose to the General Meeting of Shareholders the appointment of an accounting firm as the auditor of the Company and its remuneration;
accounting firm as the auditor of the Company and its remuneration;
(XIX) Make major accounting policies and accounting estimate change plans of
(XIX) Make major accounting policies and accounting estimate change plans of the Company;
the Company;
(XX) Formulate the stock ownership incentive plan of the Company;
(XX) Formulate the stock ownership incentive plan of the Company;
(XXI) Receive the working reports of the general manager and investigate his
(XXI) Receive the working reports of the general manager and investigate his or her work;
or her work;
(XXII) Decide on the establishment of special committees and the appointment
(XXII) Decide on the establishment of special committees and the appointment and dismissal of their relevant candidates;
and dismissal of their relevant candidates;
(XXIII) Formulate a work report of the Board of Directors;
(XXIII) Formulate a work report of the Board of Directors;
(XXIV) Decide on the Company's compliance management system, deliberate and
(XXIV) Other powers granted by laws, administrative regulations, departmental approve the basic system, system construction plan and annual report of
rules, or the Articles of Association. compliance management, promote the improvement of the compliance management
system and evaluate its effectiveness, study and decide on major matters of
When the Board of Directors makes resolutions mentioned in the preceding compliance management, and decide on the setting and responsibilities of the
paragraph, except for the circumstances in which directors shall recuse Compliance Management Department.
themselves from voting according to relevant laws, regulations, the Articles
of Association, and these Rules, more than half of the total number of (XXV) Other powers granted by laws, administrative regulations, departmental
directors of the Company must vote in favor of the proposal. When the Board of rules, or the Articles of Association.
Directors makes resolutions on the matters mentioned in Items (VII), (VIII),
and (XVI) of the preceding paragraph, the consent of more than half of all When the Board of Directors makes resolutions mentioned in the preceding
directors of the Company shall be obtained and it must also be approved by paragraph, except for the circumstances in which directors shall recuse
more than two-thirds of the directors present at the meeting of the Board of themselves from voting according to relevant laws, regulations, the Articles
Directors. If it is stipulated in laws, administrative regulations, and the of Association, and these Rules, more than half of the total number of
Articles of Association that the Board of Directors shall obtain the consent directors of the Company must vote in favor of the proposal. When the Board of
of more directors when creating a resolution, such stipulation shall apply. Directors makes resolutions on the matters mentioned in Items (VII), (VIII),
and (XVI) of the preceding paragraph, the consent of more than half of all
directors of the Company shall be obtained and it must also be approved by
more than two-thirds of the directors present at the meeting of the Board of
Directors. If it is stipulated in laws, administrative regulations, and the
Articles of Association that the Board of Directors should obtain the consent
of more directors when creating a resolution, such stipulation shall apply.
Article 6 When the Company shall disclose foreign investments, purchase and Article 6 When the Company shall disclose foreign investments, purchase and
sale of major assets, pledge of assets, related-party transactions, and sale of major assets, pledge of assets, related-party transactions, entrusted
external guarantees according to the provisions of the Articles of Association financing, external donations, and external guarantees according to the
and under the Rules Governing the Listing of Stocks on Shanghai Stock provisions of the Articles of Association and under the Rules Governing the
Exchange, these matters shall be subject to review and approval by the Board Listing of Stocks on Shanghai Stock Exchange, these matters shall be subject
of Directors. For matters that require submission to the General Meeting of to review and approval by the Board of Directors. For matters that require
Shareholders for review and approval according to relevant laws, submission to the General Meeting of Shareholders for review and approval
administrative regulations, departmental rules, and the Rules Governing the according to relevant laws, administrative regulations, departmental rules,
Listing of Stocks on Shanghai Stock Exchange, the Board of Directors shall and the Rules Governing the Listing of Stocks on Shanghai Stock Exchange, the
submit such matters to the General Meeting of Shareholders for review and Board of Directors shall submit such matters to the General Meeting of
approval. Shareholders for review and approval.
Article 12 An extraordinary meeting shall be convened by the Board of Article 12 An extraordinary meeting shall be convened by the Board of
Directors where one of the following cases occurs: Directors where one of the following cases occurs:
(I) Shareholders representing more than one tenth of the voting rights propose (I) Shareholders representing more than one tenth of the voting rights propose
to convene such a meeting; to convene such a meeting;
(II) More than one-third of all the directors jointly propose to convene such (II) More than one-third of all the directors jointly propose to convene such
a meeting; a meeting;
(III) More than half of all the independent directors propose to convene such (III) More than half of all the independent directors propose to convene such
a meeting; a meeting;
(IV) The Supervisory Committee proposes to convene such a meeting; (IV) The Supervisory Committee proposes to convene such a meeting;
(V) The chairman deems it is necessary to convene such a meeting; (V) The chairman deems it is necessary to convene such a meeting;
(VI) The general manager proposes to convene such a meeting; (VI) The general manager proposes to convene such a meeting;
(VII) The regulatory authority of securities requires to convene such a (VII) The regulatory authority of securities requires to convene such a
meeting; meeting;
(VIII) Such a meeting shall be convened in other circumstances stipulated in (VIII) Such a meeting shall be convened in other circumstances stipulated in
the Articles of Association. the Articles of Association.
Article 18 Directors shall attend meetings of the Board of Directors in Article 18 Directors shall attend meetings of the Board of Directors in
person. Where a director is unable to attend for any reason, other director person. Where a director is unable to attend for any reason, other director
could be entrusted in writing to attend such meeting on his/her behalf. The could be entrusted in writing to attend such meeting on his/her behalf. The
certificate of entrustment shall specify: certificate of entrustment shall specify:
(I) Names of trustor and trustee; (I) Names of trustor and trustee;
(II) The trustor's brief opinions on each proposal; (II) The trustor's brief opinions on each proposal;
(III) The trustor's authorization scope and validity period and directives for (III) The trustor's authorization scope and validity period and directives for
the intention of voting on proposals; the intention of voting on proposals;
(IV) The trustor's signature, date, etc. (IV) The trustor's signature, date, etc.
The director representative attending the meeting shall exercise the The director representative attending the meeting shall exercise the
director's duties within the authorized scope. director's duties within the authorized scope.
The trustor who entrusts other directors to sign on the written confirmation The trustor who entrusts other directors to sign on the written confirmation
for regular reports shall authorize special rights in the certificate of for regular reports shall authorize special rights in the certificate of
entrustment. entrustment.
The trustee shall submit the written certificate of entrustment to the The trustee shall submit the written certificate of entrustment to the
moderator and specify the entrustment in the register of attendance. moderator and specify the entrustment.
Where a director neither attends the meeting of the Board of Directors nor Where a director neither attends the meeting of the Board of Directors nor
entrusts another director to attend on his/her behalf, he/she shall be deemed entrusts another director to attend on his/her behalf, he/she shall be deemed
to waive his/her voting rights at the said meeting. to waive his/her voting rights at the said meeting.
The responsibilities of directors for voting matters shall not be exempted by
the entrustment of other directors.
Article 23 After the full discussion on each proposal, the moderator shall ask Article 23 After the full discussion on each proposal, the moderator shall ask
the present directors to vote for proposals one by one. the present directors to vote for proposals one by one.
The one-person-one-vote system shall be practiced when resolutions of the The one-person-one-vote system shall be practiced when resolutions of the
Board of Directors are put to vote. In the case of equal affirmative and Board of Directors are put to vote.
dissenting votes, the Chairman has the right to cast one more vote.
The voting method for resolutions of the Board of Directors is on-site voting,
The voting method for resolutions of the Board of Directors is on-site voting, including voting by poll and voting by a show of hands.
including voting by poll and voting by a show of hands.
The voting intention of directors shall be divided into "favor", "against",
The voting intention of directors shall be divided into "favor", "against", and "abstention". The present directors shall choose one from the foregoing
and "abstention". The present directors shall choose one from the foregoing intentions. The moderator shall request directors who have not chosen any
intentions. The moderator shall request directors who have not chosen any intention or have chosen at least two intentions simultaneously to re-choose
intention or have chosen at least two intentions simultaneously to re-choose the intention, and those directors who refuse to choose any intention shall be
the intention, and those directors who refuse to choose any intention shall be deemed as abstention of the exercise of voting power; directors who leave the
deemed as abstention of the exercise of voting power; directors who leave the venue during meetings and have not chosen any intention shall be deemed as
venue during meetings and have not chosen any intention shall be deemed as abstention of the exercise of voting power.
abstention of the exercise of voting power.
Provided that the directors are ensured to be able to fully express opinions,
Provided that the directors are ensured to be able to fully express opinions, the interim meeting of the Board of Directors can be held and resolution can
the interim meeting of the Board of Directors can be held and resolution can be made by correspondence (including fax), and the resolution shall be signed
be made by correspondence (including fax), and the resolution shall be signed by directors attending the meeting.
by directors attending the meeting.
Article 28 The Board of Directors shall make resolutions in regard to profit Article 28 The Board of Directors shall make resolutions in regard to profit
distribution and increase of capital converted by capital reserve. For matters distribution and increase of capital converted by capital reserve. For matters
without official audit reports from the certified accountant, the resolution without official audit reports from the certified accountant, the resolution
could be made accounting to the draft audit report (financial data other than could be made accounting to the draft audit report (financial data other than
profit distribution or increase of capital converted by accumulation fund are profit distribution or increase of capital converted by accumulation fund are
determined) at first. After the official report is offered, the resolution can determined) at first. After the official report is offered, the resolution can
be finalized. be finalized.
If independent directors believe that the specific plan for cash dividends may
harm the rights and interests of the Company or minority shareholders, they
have the right to express independent opinions. If the Board of Directors has
not adopted or fully adopted the opinions of independent directors, the
opinions of independent directors and the specific reasons for not adopting
them shall be recorded in the resolution of the Board of Directors and
disclosed.
Article 31 The Board of Directors shall keep minutes on decisions of the Article 31 The Board of Directors shall keep minutes on decisions of the
meeting on the agenda items, and directors and the Secretary of the Board of meeting on the agenda items, and directors and the Secretary of the Board of
Directors present at the meeting and the recorder shall sign on the minutes. Directors present at the meeting and the recorder shall sign on the minutes.
The minutes of meetings of the Board of Directors shall be preserved as The minutes of meetings of the Board of Directors shall be preserved as
archives. The Secretary of the Board of Directors shall appoint relevant archives. The Secretary of the Board of Directors shall appoint relevant
personnel of the Securities Department to make the minutes of meetings of the personnel of the Securities Department to make the minutes of meetings of the
Board of Directors. The minutes shall record: Board of Directors. The minutes shall record:
(I) Session, date, place of the meeting, and in what way it is held; (I) The date and place of the meeting and the name of the convener;
(II) Delivery of meeting notice; (II) Names of the directors attending the meeting and the directors (proxies)
entrusted to attend the meeting of the Board of Directors;
(III) Names of convener and moderator of the meeting;
(III) Agenda of the meeting;
(IV) The attendance of directors personally or under entrustment;
(IV) Main points of speeches delivered by directors;
(V) Instructions for meeting procedure and convocation;
(V) Voting method and results of the resolution for each issue (the voting
(VI) Proposals to be reviewed, key points addressed by each Director on result shall state the number of affirmative votes, negative votes, or
relevant matters, his/her main opinions, and voting options for proposals; abstention votes).
(VII) Voting method and result of each draft resolution (specifying numbers of
votes in favor, against, and abstention);
(VIII) Other matters as directors present consider to be recorded.
A new article is added and the serial number of original Article 35 has been Article 35 If the Board of Directors does not adopt or fully adopt the
sequentially replaced with Article 36. opinions of the Nomination Committee and the Remuneration and Assessment
Committee, the opinions of the professional committees and the specific
reasons for not adopting them shall be recorded in the resolutions of the
Board of Directors and disclosed.
When disclosing resolutions of the Board of Directors, the Company shall also
disclose the dissenting opinions of independent directors and record them in
the resolutions of the Board of Directors and minutes of meetings.
Article 37 The Secretary of the Board of Directors shall be responsible for Article 37 The Secretary of the Board of Directors shall be responsible for
preserving the archives of meetings of the Board of Directors including notice preserving the archives of meetings of the Board of Directors including notice
of meetings, documents of meetings, register of meetings, certificate of of meetings, documents of meetings, certificate of entrustment, votes, records
entrustment, votes, records of meetings signed by the present directors for of meetings signed by the present directors for confirmation, minutes of
confirmation, minutes of meetings (if any), records of resolutions (if any), meetings (if any), records of resolutions (if any), and announcements of
and announcements of resolutions. The Secretary of the Board of Directors may resolutions. The secretary of the Board of Directors may entrust the
entrust the Securities Department of the Company to act as the custodian. Securities Department of the Company to act as the custodian.
The archives of meetings of the Board of Directors shall be preserved for 10 The archives of meetings of the Board of Directors shall be preserved for 10
years. years.
The above proposal has been deliberated and approved at the 28th Meeting of
the Twelfth Board of Directors on May 29, 2024, and it is hereby presented to
you for deliberation and approval (as special resolution).
Proposal IX
SDIC Power Holdings Co., Ltd.
Proposal on Amending the Working System of Independent Directors
Dear shareholders and shareholders' representatives,
To fully leverage the role of independent directors and further improve its
corporate governance structure, the Company plans to amend the Working System
of Independent Directors of SDIC Power Holdings Co., Ltd. according to the
Administrative Measures for Independent Directors of Listed Companies issued
by the China Securities Regulatory Commission, the Rules Governing the Listing
of Stocks on Shanghai Stock Exchange, and the Guidelines No. 1 of Shanghai
Stock Exchange for Self-regulation of Listed Companies - Standardized
Operation.
The major amendments are as follows:
I. The qualification requirements for independent director candidates have
been updated according to the Guidelines No. 1 of Shanghai Stock Exchange for
Self-regulation of Listed Companies - Standardized Operation;
II. According to the Administrative Measures for Independent Directors of
Listed Companies, the independence requirements, responsibilities and
performance methods, appointment and dismissal requirements, and performance
guarantees of independent director candidates have been correspondingly
amended, and other contents related to special meetings for independent
directors have been added.
For other specific details, please refer to the full text of the system in the
annex.
The above proposal has been deliberated and approved at the 28th Meeting of
the Twelfth Board of Directors on May 29, 2024, and it is hereby presented to
you for deliberation and approval.
Annex
SDIC Power Holdings Co., Ltd.
Working System of Independent Directors
Chapter I General Provisions
Article 1 The Working System is formulated in accordance with the
Company Law of the People's Republic of China (hereinafter referred to as the
"Company Law") and the Articles of Association of SDIC Power Holdings Co.,
Ltd. (hereinafter referred to as the "Articles of Association") and other
relevant laws and regulations, as well as with reference to the Administrative
Measures for Independent Directors of Listed Companies (hereinafter referred
to as the "Administrative Measures") issued by China Securities Regulatory
Commission (hereinafter referred to as "CSRC"), Guidelines No. 1 of Shanghai
Stock Exchange for Self-regulation of Listed Companies - Standardized
Operation (Revised August 2023) (hereinafter referred to as the "Standardized
Operation") and other regulations and guidelines, for the purpose of promoting
the standardized operation of SDIC Power Holdings Company Limited (hereinafter
referred to as "the Company"), safeguarding the interests of the Company as a
whole, and protecting the lawful rights and interests of all shareholders,
especially the small and medium-sized shareholders.
Article 2 Independent directors refer to directors who do not hold any other
positions rather than directors in the listed company, and have no direct or
indirect interest relationship with the listed company in employment and its
major shareholders and actual controllers, nor any other relationship that may
affect their independent and objective judgments.
Article 3 The independent directors shall have the duty of loyalty and
diligence to the Company and all shareholders. Independent directors shall
conscientiously perform their duties and safeguard the overall interests of
the Company in accordance with relevant laws and regulations, the
Administrative Measures and the Articles of Association, especially paying
attention to that the legitimate rights and interests of public shareholders
are not damaged. Independent directors shall perform their duties
independently, free from any influence of the principal shareholders and
actual controllers of the Company or any other organization or individual in
benefit-based relationships with the Company.
Article 4 Independent directors shall ensure that they have enough time and
energy to effectively perform the duties of an independent director.
Article 5 The number of independent directors of the Company shall not be less
than one-third of the total number of directors on the Board of Directors,
including at least one accounting professional.
Article 6 For the Remuneration and Assessment Committee, the Audit Committee
and the Nomination Committee under the Board of Directors, more than half of
the members of such committees shall be independent directors. The Audit
Committee shall be convened by the accounting professional among independent
directors, and the Remuneration and Appraisal Committee and the Nomination
Committee shall be convened by an independent director.
Chapter II Qualifications and Conditions of Independent Directors
Article 7 Independent directors of the Company shall meet the following basic
requirements:
(i) Have the qualification to serve as a director of a listed company in
accordance with laws, administrative regulations and other relevant
provisions;
(ii) Have the independence required by the Working System;
(iii) Have basic knowledge of the operation of listed companies, and be
familiar with relevant laws, administrative regulations, rules and
regulations;
(iv) Have more than five years of work experience in law, accounting,
economics or other aspects necessary for performing the duties of an
independent director;
(v) Other conditions specified in the Articles of Association.
Article 8 The qualifications of independent director candidates shall meet the
requirements of the following laws and regulations:
(i) Provisions of the Company Law on qualifications of directors;
(ii) Provisions concerning the concurrent posts of civil servants in Civil
Servant Law of the People's Republic of China;
(iii) Administrative Measures for Independent Directors of Listed Companies
issued by China Securities Regulatory Commission and self-regulation rules of
the Shanghai Stock Exchange;
(iv) Provisions of the Central Commission for Discipline Inspection and
Organization Department of the CPC Central Committee (Notification on
Regulating the Cadres Filed in Central Organization Department to Serve as the
Independent Director or Independent Supervisor in Listed Company and Funds
Management Company after Leaving Public Office or Retirement);
(v) Relevant provisions of the Opinions on Further Regulating the Part-time
Jobs (Appointments) of Party and Government Leading Cadres in Enterprises
issued by the Organization Department of the CPC Central Committee;
(vi) Relevant provisions of the Central Commission for Discipline Inspection,
Ministry of Education and Ministry of Supervision concerning Opinions on
Strengthening Anti-corruption and Clean Government Construction in Colleges
and Universities.
(vii) Circumstances stipulated by other laws, regulations, departmental rules,
Articles of Association and Shanghai Stock Exchange.
Article 9 The independent director candidates shall be independent and do not
belong to the following circumstances:
(i) Persons who work in the Company or its affiliated enterprises and their
spouses, parents, children and main social relations (main social relations
refer to siblings, spouses of siblings, parents-in-law, siblings-in-law,
spouses of children, parents-in-law of children's spouses, etc.);
(ii) Natural person shareholders directly or indirectly holding more than 1%
of the issued shares of the Company or among the top 10 shareholders of the
Company and their spouses, parents and children of such persons;
(iii) Persons employed by the companies that directly or indirectly hold more
than five percent of the issued capital stock of the Company or the companies
among the top fire shareholders of the Company or their spouses, parents and
children of such persons;
(iv) Persons who work in the affiliated enterprises of the Company's
controlling shareholder and actual controller and their immediate family
members;
(v) Persons who have major business dealings with the Company, its controlling
shareholders, actual controllers or their respective affiliated enterprises,
or persons who hold posts in companies with major business dealings with them,
their controlling shareholders and actual controllers;
(vi) Persons who provide financial, legal, consulting and sponsorship services
for the Company, its controlling shareholders or their respective affiliated
enterprises, including but not limited to all project team persons of
intermediaries providing service, reviewers at all levels, persons signing the
report, partners, directors, senior executives and principals;
(vii) Persons who are covered under the circumstances listed in items (i) to
(vi) within the last twelve months;
(viii) Other persons who do not have independence as stipulated by laws,
administrative regulations, provisions of the China Securities Regulatory
Commission, business rules of the Shanghai Stock Exchange and the Articles of
Association.
The affiliated enterprises of the Company's controlling shareholder and actual
controller mentioned in items (iv) to (vi) of the preceding paragraph do not
include those controlled by the same state-owned asset management agency as
the Company or that have not formed an association relationship with the
Company according to relevant regulations.
Independent directors shall conduct self-examinations on their independence
every year and submit the self-examination results to the Board of Directors.
The Board of Directors shall evaluate the independence of incumbent
independent directors every year and issue special opinions, which shall be
disclosed together with the annual report.
Article 10 The independent director candidates shall have no negative records
as listed below:
(i) Administrative punishment by the China Securities Regulatory Commission or
criminal penalties by the judiciary authorities for securities and futures
violations in the past three years;
(ii) The period that the person has publicly confirmed by the Securities
Exchange not to be suitable for acting as a Director of the Board of Directors
of a listed company has not expired;
(iii) The public censure or three times of notice of criticism or above
has/have been made by the Securities Exchange in the last three years;
(iv) Where, during a previous term as an independent director, the candidate
failed to attend, in person or by proxy, two consecutive meetings and the
Board of Directors proposed to the General Meeting of Shareholders to remove
him or her from office; and the period since such dismissal has not exceeded
12 months;
(v) Where the candidate is under investigation by the China Securities
Regulatory Commission or judicial authority for suspected violations of laws
and regulations concerning securities and futures, but there has been no
definitive conclusion yet;
(vi) There is a negative record of major untrustworthiness or so on;
(vii) The independent opinions issued during his tenure as an independent
director were clearly inconsistent with the facts;
(viii) Other circumstances as determined by the Shanghai Stock Exchange.
Article 11 An independent director should, in principle, serve as an
independent director for no more than three listed companies in China, and
should ensure that he or she has sufficient time and energy to perform the
duties of an independent director effectively.
Article 12 Those who are nominated as candidates for independent directors in
the capacity of accounting professionals shall have rich professional
knowledge and experience in accounting, and meet at least one of the following
conditions:
(i) Have the qualification of a certified public accountant;
(ii) Have a senior professional title in accounting, auditing or financial
management, an associate professor's professional title or above, or a
doctoral degree;
(iii) Have senior professional titles in economic management and more than 5
years of full-time working experience in accounting, auditing or financial
management.
Article 13 Where an independent director no longer meets the qualifications
for serving as such after assuming office due to any circumstances set out in
this Chapter, he or she shall immediately cease the performance of duties and
tender his or her resignation from the position of independent director. Where
a director fails to resign as required, the Board of Directors shall
immediately remove him from his position in accordance with the rules upon
becoming aware or upon having reason to know of the occurrence of the fact.
Chapter III Appointment and Dismissal of Independent Directors
Article 14 The Board of Directors, the Supervisory Committee, and the
shareholders individually or jointly holding more than 1% of the issued stock
of the Company can nominate the candidates for independent directors who shall
go through the election of the General Meeting of Shareholders.
Article 15 The nominators of candidates for independent directors shall
acquire the consent of the nominee prior to nomination.
Article 16 The nominators shall fully understand the nominee's occupation,
educational background, professional title, detailed work experience, all
part-time jobs, whether there are negative records such as major dishonesty,
etc., and express opinions on his/her independence and other conditions for
serving as an independent director. The nominee shall make a public statement
on his/her independence and other conditions for serving as an independent
director.
The Nomination Committee of the Board of Directors shall examine the
qualifications of nominees and form clear examination opinions.
Article 17 Before the General Meeting of Shareholders for electing independent
directors is convened, the Company shall disclose the relevant contents in
accordance with the provisions of Article 15 and Article 16 of the Working
System, and submit the relevant materials of all nominees to the Shanghai
Stock Exchange. The relevant submitted materials shall be true, accurate and
complete. In case of any objection of the Board of Directors for the
information of a nominee, the written comments of the Board of Directors shall
also be delivered at the same time.
Article 18 If the independent director candidate does not meet the
qualifications or independence requirements for independent directors, the
Shanghai Stock Exchange may raise objections to the qualifications and
independence of the independent director candidate, and the Company shall
disclose them promptly.
During the General Meeting of Shareholders for electing independent directors,
the Board of Directors shall make a statement on whether or not the Shanghai
Stock Exchange has any objection to the candidates for independent directors.
The Company shall not submit to the General Meeting of Shareholders for
election of candidates for independent directors who have raised objections
from the Shanghai Stock Exchange. The proposal shall be canceled if it has
already been submitted for deliberation at the General Meeting of
Shareholders.
Article 19 The independent directors have the same term of office as the other
directors of the Company and are entitled to reelection and reappointment upon
expiration of the term of office. However, the term of reappointment shall not
exceed 6 years.
Article 20 Before the term of office of an independent director expires, the
Company may remove him/her from office in accordance with legal procedures. In
the event that the term of an independent director is prematurely terminated,
the Company should promptly disclose the specific reasons and grounds for such
termination. If an independent director believes that the reasons for
dismissal are improper, he or she may raise objections and reasons, and the
Company shall disclose them promptly.
Article 21 Where an independent director fails to attend the meeting of the
Board of Directors in person or does not entrust other independent directors
to attend on his/her behalf for two consecutive times, the Board of Directors
shall propose to the General Meeting of Shareholders within 30 days from the
date of occurrence of such fact to remove from office of the independent
director.
Article 22 The independent director shall submit a written resignation to the
Board of Directors and elaborate on the issues related to the resignation or
issues that he/she believes necessarily require the attention of the
shareholders and the creditor of the Company. The Company shall disclose the
reasons for and matters concerning the resignation of independent directors.
Where the proportion of independent directors in all members of the Board of
Directors is less than one-third due to the resignation of independent
directors, or the number of independent directors is less than half in the
Remuneration and Assessment Committee, the Audit Committee and the Nomination
Committee under the Board of Directors of the Company, or there is no
accounting professional among the independent directors, the independent
director who proposed to resign shall continue to perform his duties until the
date when a new independent director is elected. The Company shall complete
the by-election within 60 days from the date of resignation of an independent
director.
Chapter IV Responsibilities and Performance Methods of Independent Directors
Article 23 The independent directors shall perform the following duties:
(i) Participate in the decision-making of the Board of Directors and express
clear opinions on the matters discussed;
(ii) Supervise the potential major conflicts of interest with its controlling
shareholder, actual controller, directors and senior executives to promote the
decision-making of the Board of Directors in line with the overall interests
of the Company and protect the legitimate rights and interests of minority
shareholders;
(iii) Provide professional and objective suggestions on the Company's business
development to promote the decision-making level of the Board of Directors;
(iv) Perform other duties specified by laws and regulations, relevant
provisions of the Shanghai Stock Exchange and the Articles of Association.
Independent directors should perform their duties independently and
impartially, free from the influence of the Company and its major
shareholders, actual controllers and other units or individuals. If it is
found that the matters under deliberation affect their independence, they
shall declare to the Company and withdraw. In case of any situation that
obviously affects his/her independence during the term of office, he/she shall
notify the Company promptly and propose solutions and shall submit the
resignation if necessary.
Article 24 The independent directors shall exercise the following special
functions and powers:
(i) Independently employ an intermediary to audit, consult or check specific
matters of the Company;
(ii) Propose to the Board of Directors to convene an Extraordinary General
Meeting of Shareholders;
(iii) Propose to convene a meeting of the Board of Directors;
(iv) Solicit shareholders' rights from the shareholder in an open manner
according to law;
(v) Express independent opinions on matters that may damage the rights and
interests of the Company or minority shareholders;
(vi) Perform other functions and powers specified in laws, administrative
regulations, provisions of the China Securities Regulatory Commission and the
Articles of Association.
Independent directors shall obtain the consent of more than half of all
independent directors when exercising items (i) to (iii) of the above special
functions and powers.
Where an independent director exercises the above-mentioned special functions
and powers, the listed company shall disclose the specific situations in a
timely manner. If the proposal put forward by independent directors according
to the above special functions and powers is not adopted or their functions
and powers cannot be exercised normally, the Company shall disclose the
specific situation and reasons.
Article 25 The following matters shall be submitted to the Board of Directors
for deliberation after being approved by more than half of all independent
directors of the Company:
(i) Related-party transactions that shall be disclosed;
(ii) Plans for change or exemption of commitments by the Company and related
parties;
(iii) Decisions and measures taken by the Board of Directors of the listed
company to be acquired with respect to the acquisition;
(iv) Other matters specified in laws, administrative regulations, provisions
of the China Securities Regulatory Commission and the Articles of Association.
Article 26 The Company shall hold regular or irregular meetings attended by
all independent directors (hereinafter referred to as the special meeting for
independent directors). The matters listed in Items (i) to (iii) of Article 24
and Article 25 of the Working System shall be deliberated at the Special
Meetings of Independent Directors.
The Special Meetings of Independent Directors may study and discuss other
matters of the Company as required.
The Special Meetings of Independent Directors shall be convened and presided
over by an independent director jointly elected by more than half of the
independent directors; if the convener fails to perform or is unable to
perform his/her duties, two or more independent directors may themselves
convene and elect a representative to preside over it.
The Company shall provide convenience and support for the Special Meetings of
Independent Directors.
Article 27 Independent directors shall attend the meeting of Board of
Directors in person. Independent directors who fail to attend meetings in
person for some reason shall review documents of meetings in advance, form
clear opinions and entrust other directors in writing to attend meetings on
his or her behalf.
Article 28 Minutes of the meetings for the Board of Directors, and special
committees and Special Meetings of Independent Directors of the Company shall
be made in accordance with the regulations, and the opinions of the
Independent Directors shall be set out in the minutes. Independent directors
shall sign the minutes of the meeting for confirmation.
Independent directors shall make work records to record the performance of
their duties in detail. The information, relevant meeting minutes and
communication records with the Company and intermediary staff obtained by
independent directors during their performance of duties constitute an
integral part of the work record. For important contents in the work records,
independent directors may require the Secretary of the Board of Directors and
other relevant persons to sign for confirmation, and the Company and relevant
persons shall cooperate.
The work records of independent directors and the materials provided by the
Company to them shall be kept for at least 10 years.
Article 29 Independent directors shall perform their duties in the special
committees of the Board of Directors in accordance with laws, administrative
regulations, provisions of the China Securities Regulatory Commission,
business rules of the Shanghai Stock Exchange and Articles of Association.
Independent directors shall attend the meeting of the special committee in
person. If they cannot attend the meeting in person for some reason, they
shall review the meeting materials in advance to form clear opinions and
entrust other independent directors in writing to attend the meeting on their
behalf. When performing their duties, independent directors may, in accordance
with established procedures, bring significant matters within the purview of a
committee to that committee for discussion and consideration.
Article 30 Independent directors should work no less than 15 days at the
company's premises each year.
In addition to attending the General Meeting of Shareholders, the Board of
Directors and its special committees, and the Special Meetings of Independent
Directors as required, independent directors may perform their duties in
various ways such as regularly obtaining information on the Company's
operation, listening to management reports, communicating with the person in
charge of internal audit institutions and intermediaries (such as accounting
firms) that undertake the audit business of the Company, making field visits,
and communicating with minority shareholders.
Article 31 The Company shall improve the communication mechanism between
independent directors and minority shareholders, and the independent directors
may verify the issues raised by investors with the Company promptly.
Article 32 Independent directors shall submit an annual work report to the
Annual General Meeting of Shareholders, explaining their performance of
duties. The annual work report shall include the following contents:
(i) Number of attendances at the Board of Directors, way and voting situation;
number of attendances at the General Meeting of Shareholders;
(ii) Participation in the work of special committees of the Board of Directors
and Special Meetings of Independent Directors;
(iii) Deliberate the potential major conflicts of interest between the Company
and its controlling shareholders, actual controllers, directors and senior
executives and exercise the special functions and powers of independent
directors listed in Article 24 of the Working System;
(iv) Major matters, methods and results of communication with the internal
audit institution and the accounting firm undertaking the audit services of
the Company on the financial and business conditions of the Company;
(v) Communication and exchanges with minority shareholders;
(vi) Times and contents of on-site work in the Company;
(vii) Other information about the performance of duties.
The annual work report of independent directors shall be disclosed at the
latest when the Company issues the notice of the Annual General Meeting of
Shareholders.
Article 33 Independent directors shall continuously strengthen the study of
securities laws, regulations and rules to constantly improve their ability to
perform duties. China Securities Regulatory Commission, Shanghai Stock
Exchange and China Association for Public Companies can provide relevant
training services.
Chapter V Performance Guarantee of Independent Directors
Article 34 The Company shall provide necessary working conditions and
personnel support for independent directors to perform their duties, and
designate special departments and personnel to assist them in performing their
duties.
The Secretary of the Board of Directors shall ensure smooth communication
between independent directors and other directors, senior executives and other
relevant persons, and ensure that independent directors can obtain sufficient
resources and necessary professional advice when performing their duties.
Article 35 The Company shall guarantee that independent directors enjoy the
same right to know as other directors. To ensure that the independent
directors effectively exercise their functions and powers, the Company shall
provide relevant materials and information to the independent directors
promptly, regularly report the operation of the Company, and organize or
cooperate with the independent directors to carry out field visits.
The Company may organize independent directors to participate in research and
demonstration before the Board of Directors deliberates major complex matters,
fully listen to the opinions of independent directors, and timely give
feedback to them on the adoption of opinions.
Article 36 The Company shall timely send the notice for the meeting of the
Board of Directors to independent directors, provide relevant meeting
materials no later than the notice period of the meeting of the Board of
Directors stipulated in the Articles of Association, and provide effective
communication channels for independent directors; if the special committee of
the Board of Directors convenes a meeting, the Company shall, in principle,
provide relevant materials and information no later than 3 days before the
convening of the special committee meeting. The Company shall keep the above
meeting materials for at least 10 years.
When two or more independent directors think that the meeting materials are
incomplete, insufficiently demonstrated or not provided in time, they may
jointly submit a written request to the Board of Directors to postpone the
meeting of the Board of Directors or postpone the deliberation of the matters,
which shall be adopted by the Board of Directors.
Article 37 The Company shall provide necessary working conditions for
independent directors to perform their duties.
The Secretary of the Board of Directors shall provide assistance for the
independent directors to perform their duties. Independent opinions,
proposals, and written explanations issued by independent directors, which are
to be disclosed, shall be handled by the Secretary of the Board of Directors
for announcement to the Shanghai Stock Exchange in a timely manner.
Article 38 Relevant personnel of the Company shall assist the independent
directors to perform their duties and neither reject, hinder nor conceal nor
interfere with their exercise of functions and powers. Where an independent
director encounters any obstruction in exercising his/her functions and powers
according to law, he/she may explain the situation to the Board of Directors,
require directors, senior executives and other relevant persons to cooperate,
and record the specific circumstances and solutions of the obstruction in the
work records; where the obstruction still cannot be eliminated, he/she may
report to China Securities Regulatory Commission and Shanghai Stock Exchange.
Article 39 The Company shall bear the expenses (for example, travel expenses)
arising from the engagement of an intermediary by independent directors and
other expenses necessary for exercising their functions and powers.
Article 40 The Company shall give the independent directors allowances
commensurate with their duties, and the standard of allowances shall be
formulated by the Board of Directors, reviewed and approved at the General
Meeting of Shareholders, and disclosed in the annual report of the Company.
In addition to the above allowances, independent directors shall not obtain
other benefits from the Company and its major shareholders, actual controllers
or interested units and persons.
Chapter VI Supplementary Provisions
Article 41 Matters not covered in the Working System shall be implemented by
the Company in accordance with relevant laws and regulations, normative
documents and the provisions of the Articles of Association.
Article 42 For the purpose of the Working System, the terms "above" and
"below" shall include the number itself; while the terms "exceeding" and
"higher than" exclude the number itself.
Article 43 The Working System is formulated by the Board of Directors and
shall come into effect after being reviewed and approved by the General
Meeting of Shareholders, and so does the revised version. The original Working
System of Independent Directors (GTDL 2017 No. 170) shall be abolished on
the effective date of the Working System.
Article 44 The Working System shall be interpreted by the Board of Directors.
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