Translation from Monqolian

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Ann[lt& tHeReso tution No lg/17o/ rnRsqaro ot.u"rrectors ry,\ "\ dated 08 Jltlv

SUCCESSION POLICY W,/

lnneF fQ fhe Resolution No.19/17of th\B\ard of.Directors rpeeting

\: "\ dated 08 J/tty 2019

FOR THE BOARD AND SENIOR MANAGEMENT

One. GENERAL PROVTSTONS

1.1. Background

1.1.1 . Under the Provision 5.6.7 of the Corporate Governance Code of Mongolia adopted by theFinancial Regulatory Commission (the "FRC") Resolution No.162 OateO 7 May 2014(the"Corporate Governance Code"), the board of directors of an entity listed on'Board A ofthe Mongolian Stock Exchange is required to satisfy itself that plans are in place for orderlysuccession for appointment to the board of directors and senior management.

1.2. Purpose

1.2.1 . Succession planning is required to ensure continuity and smooth functioning of theCompany and to ensure that investors/stakeholders do not suffer due to sudden orunplanned gaps in leadership.

1.2.2. The purpose of this Policy is to make a plan for orderly succession for appointment to theBoard (as defined below) and senior Management (as defined below).

1.3. Definitions"Board of Directors" or "Board" means the Board of Directors of the Company as elected/re-elected, from time to time.

"Company" means APU Joint Stock Company.

"Company Law" means the Company Law, 2011 and the rules framed thereunder, each asamended.

"Corporate Governance Code" means the Corporate Governance Code of Mongolia adoptedby the Financial Regulatory Commission Resolution No. 162 dated 7 May 2014, as amended."FRC" means the Financial Regulatory Commission of Mongolia.KMP'

or "Key Managerial Personnel" means:

the chief executive officer;the chief financial officer;Board secretary; andsuch other officer as may be prescribed under the Company Law.

"Manual of Authority" means the Manual of Authority document adopted by the Board ofDirectors Resolution No. 18/09 dated 21 February 2018, as amended."Nomination Committee" or "Committee" means the Nomination Committee of the Boardappointed/re-appointed, from time to time, under the provisions of Article 81 of the Company Law,201 1, as amended.

"Policy" means this succession policy

Translation from Monqolian

"Senior Management" means personnel of the Company who are members of its coremanagement team, excluding the directors on the Board. This shall include all members ofmanagement team, including all functional heads."Stock Exchange(s)" means the Mongolian Stock Exchange.

Two. PROCEDURE FOR SUCCESSTON

2.1. Succession Plan for the Board and the KMps

2.1.1. The Committee shall identify suitable persons from among the existing top managementpersonnel or from outside the Company to fill up the vacancy at the Boird and KMp level.

2.1 .2. The Committee shall apply a diligence process to determine the suitability of every personwho is being considered for appointment or re-appointment as a director or KMp of theCompany based on his/her educational qualifications, experience and track record.

2.1.3. The appointment, re-appointment or removal of the person at the Board and KMp levelshall be recommended by the Committee and approved in accordance with the Manual ofAuthority. Such appointment, re-appointment or removal shall be in accordance with theapplicable provisions of the Company Law and other laws as applicable to the Company.

2.2. Succession Plan for the Senior Management

2.2.1. The Committee, together with the Chief Executive Officer, shall periodically review andconsider the list of Senior Management due for retirement or resignation wiihin the year.New vacancies that may arise because of business needs or up-gridation of departmbnt(s)shall also be considered and recommended by the Committee and the Chief ExecutiveOfficer and approved by the Board. Accordingly, the Committee shall assess theavailability of suitable candidates for the Company's future growth and development.

2.2.2, The vacancy or fresh appointments at the Senior Management level shall be in line withthe organization's mission, vision, values, goals and objectives.

2.2.3. The Chief Executive Officer with the support from the Head of Human Resources function(CHRO) shall also, from time to time identify and recommend high-potential employeeswho merit faster career progression and formulate, administer, monitor and revtew theprocess of skill development and identify training requirements in respect of suchemployees. The Committee shall provide required assistance.

2.2,4. The Board may authorize the Committee to frame an internal policy for identifying anddeveloping an internal pool of talent for future leadership role,

Three. EMERGENCY succESSroN oR TEMpoRARy CHANGE

3.1. lf a director's sloVKMP's position suddenly becomes vacant by reason of death or otherunanticipated occurrence, the Committee shall convene a special meeting as early aspossible to identify/recommend a successor. The appointment shall be iormalized inaccordance with applicable laws.

3.2. lf a Senior Management's position suddenly becomes vacant by reason of death or otherunanticipated occurrence, the Chref Executive Officer in consuliation with the Committeeshall appoint a successor.

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Translation from Monqolian

For a temporary change in executive leadership (i.e., illness or leave of absence for longtime), the Chief Executive Officer shall appoint a temporary successor. lf such successoris not competent in the view of the Committee, then the appointment may be changed asdecided by the Committee in consultation with the Chief Executive Officer,

Four. REVIEW, MONTTORTNG AND TMPROVEMENT

The Committee shall be responsible for implementing this Policy and its relatedprocedures, and the Board shall review and monitor the implementation of this Policy toensure its effectiveness and for ensuing effective succession planning.

The Board shall have the power to clarify any doubts or rectify any anomalies that mayexist in connection with the effective execution of this Policy. The Board reserves the rightto amend_this Policy from time to time based on changing requirements as prescribed bythe FRC/stock Exchange(s) or any other appropriate statutory authority.

Five. DISCLOSURE OF THE POLICY

This Policy shall be disclosed in the annual report of the Company and posted on thewebsite of the Company, if required under the Company Law and rules thereunder, FRCregulations as amended, and any other regulatory requirements.

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