Management Measures for the 2026 Medium- to Long-Term Employee Stock Ownership Plan

Management Measures for the 2026 Medium- to Long-Term Employee Stock Ownership Plan

Chapter 1: Formulation of the Employee Stock Ownership Plan

1. Basic Principles of the Employee Stock Ownership Plan (1) Legal Compliance Principle
   The company will implement the stock ownership plan in strict accordance with laws and regulations, ensuring timely and accurate information disclosure. No one may use the plan for insider trading or market manipulation.
   (2) Voluntary Participation Principle
   Participation in the stock ownership plan is based on the company's independent decision and voluntary participation by employees; the company will not force participation through allocation or coercion.
   (3) Benefit Sharing Principle
   The number of shares actually allocated to participants will be strictly linked to the achievement of key performance indicators and individual performance, creating a benefit-sharing mechanism among shareholders, the company, and participants.
   (4) Risk Bearing Principle
   Participants bear their own profits and losses, with equal rights to other investors.

2. Participants in the Employee Stock Ownership Plan
   The participants in this stock ownership plan include mid-level management and outstanding core employees of the company. Specifically, participants include:

   1. Heads of departments at the company headquarters, senior professionals, and other personnel of equivalent management and professional levels;
   2. Management and professionals at subordinate business units equivalent to the above positions;
   3. Outstanding core personnel who play a key role in the company's operational performance and long-term development. All participants must work at the company or its subordinate units and receive a salary.

3. Sources of Funds and Stocks for the Employee Stock Ownership Plan
   (1) Sources of Funds
   (1) The funds for this stock ownership plan will come from employees' legal income, performance bonuses, or other legally permitted means. The total amount for this plan will not exceed 920 million yuan.
   (2) The plan does not involve the company providing financial assistance or guarantees for loans to participants, nor does it involve leveraged funds.
   (3) There are no arrangements for third parties to provide rewards, subsidies, or guarantees for employees participating in the stock ownership plan.
   (2) Sources of Stocks
   The stocks for this plan will be sourced from shares repurchased by the company. The company held its 23rd meeting of the 8th Board of Directors on June 1, 2026, and approved the proposal to repurchase part of the public shares. The stocks for this plan will come from the aforementioned repurchased shares. Based on the closing price of the company's stock at 4.28 yuan per share on May 29, 2026, the maximum number of shares that can be purchased under this plan is approximately 21,495,330 shares, accounting for about 1.03% of the company's total share capital. The final number of shares held under this plan will be based on the actual number of shares transferred. This plan will acquire the company's stocks within six months after the shareholders' meeting approves the plan, through legal and compliant means such as non-trading transfers. The transfer price for this plan will be based on the actual average repurchase price of the shares, not lower than the par value of the shares, and in principle, not lower than the higher of the following: 50% of the average trading price of the company's stock on the trading day prior to the announcement of the plan; or 50% of the average trading price over the previous 20, 60, or 120 trading days. The pricing basis for the stock transfer price is as follows:
   (1) It combines the company's operational situation with the goal of strengthening the core team, referencing relevant policies and cases of listed companies, thus forming a feasible plan that matches the company's actual situation.
   (2) This stock ownership plan aims to improve the company's governance mechanism, enhance the compensation system, and increase the overall value of the company. Therefore, the pricing principles of this plan align with the company's actual incentive needs, promoting the stable and continuous development of the company’s performance, without harming the rights and interests of the company and minority shareholders, ensuring rationality and scientificity.