Yum China Holdings, Inc.

Notice Of Special Meeting

Of Stockholders

1290 Avenue of the Americas, 9^th Floor

New York, NY 10104

Shareholders, Banks and Brokers

Call Toll Free:

866-316-3922

International Number:

781-575-2137

The Board of the Company solicits the enclosed proxy for use at the Special Meeting to be held at 8:00 a.m. Beijing/Hong Kong time on Tuesday, October 11, 2022 / 8:00 p.m. U.S. Eastern time on Monday, October 10, 2022. The Special Meeting will be held in a virtual-only format, through a

live audio webcast. The Special Meeting will only be conducted via webcast; there will be no physical meeting location. This proxy statement contains information about the matters to be voted on at the Special Meeting and the voting process.

The Board called the Special Meeting in order to seek stockholder approval of certain matters to facilitate a voluntary conversion of the Company’s listing status from secondary to primary listing on the Hong Kong Stock Exchange. On September 10, 2020, the Company’s shares of common stock began trading on the Hong Kong Stock Exchange as a secondary-listed company, while also concurrently being primary listed and traded on the NYSE. The Board has determined that the Primary Conversion will provide strategic benefits to the Company, including enhancing our stock trading on an exchange that is closer to where we operate, and thus, to our employees, customers and other stakeholders, further broadening our shareholder universe and increasing liquidity.

In addition, our Board considered that the Primary Conversion will mitigate the delisting risk that the Company faces on the NYSE pursuant to the SEC’s implementation of the Holding Foreign Companies Accountable Act (the “Act”), which was signed into law on December 18, 2020. The Act requires the SEC to prohibit the securities of any “covered issuer,” including the Company, from being traded on any of the U.S. securities exchanges, including the NYSE, or traded “over-the-counter,” if the auditor of the covered issuer’s financial statements is not subject to inspection by the Public Company Accounting Oversight Board (the “PCAOB”) for three consecutive years, beginning in 2021. On December 2, 2021, the SEC adopted final rules implementing the Act, pursuant to which the SEC will identify companies subject to the Act, known as “Commission-Identified Issuers,” as early as possible

after the filing of their next annual report, and implement the trading prohibition as soon as practicable after they have been conclusively identified as Commission-Identified Issuers for three consecutive years.

Pursuant to the Act and the final rules adopted by the SEC, in March 2022, the Company was conclusively identified as a Commission-Identified Issuer by the SEC. In view of such identification, the Company’s shares of common stock may be delisted from the NYSE in early 2024, or in early 2023, if pending legislation passes reducing the number of consecutive non-inspection years required to trigger a trading prohibition under the Act. On August 26, 2022, the PCAOB signed a Statement of Protocol with the China Securities Regulatory Commission and the Ministry of Finance of the People’s Republic of China governing inspections and investigations of audit firms based in China and Hong Kong (the “SOP”). However, depending on the implementation of the SOP, if the PCAOB continues to be prohibited from conducting complete inspections and investigations of PCAOB-registered public accounting firms in China, then China-based companies will be delisted pursuant to the Act despite the SOP. Therefore, there is no assurance that the SOP could give relief to the Company against the delisting risk from the application of the Act. The Primary Conversion would provide a primary market for the trading of the Company’s shares if they are ultimately delisted from the NYSE in accordance with the Act and would facilitate the orderly transition of trading to the Hong Kong Stock Exchange in that event. Specifically, by

initiating the Primary Conversion now, the Company is undertaking a voluntary conversion in order to be proactive and prepared in the event that the Company’s shares are ultimately delisted from the NYSE.

In view of the rationale described above, the Board determined that it is in the best interests of the Company and its stockholders to apply for the Primary Conversion.

On August 15, 2022, the Company received the acknowledgement from the Hong Kong Stock Exchange for the Company’s application for Primary Conversion.

As a secondary-listed issuer on the Hong Kong Stock Exchange under Chapter 19C of the Hong Kong Listing Rules, the Company has been and is currently exempt from certain provisions of the Hong Kong Listing Rules, including, among others, rules on share issuance, repurchases, notifiable transactions, connected transactions, share option schemes and content of financial statements, as well as certain other continuing obligations. As a secondary-listed issuer, the Company was also granted a number of waivers and/or exemptions from strict compliance with the applicable Hong Kong laws and regulations.

From the Primary Conversion Effective Date, the Company will have a primary listing status on the Hong Kong Stock Exchange and the Company will be subject to the full regime of the applicable Hong Kong laws and regulations, unless specific waivers have been obtained from the Hong Kong Stock Exchange or the Securities and Futures Commission of Hong Kong.

The Board of Directors called the Special Meeting in order to obtain, in accordance with the Hong Kong Listing Rules, stockholder approval with regard to the three Items of Business set forth below. Under Delaware law and NYSE listing rules, the Company and the Board are not required to obtain stockholder approval with respect to the first two Items of Business (subject to applicable restrictions). The Company is seeking approval of the first two Items of Business described below solely to comply with the Hong Kong Listing Rules, as described in more detail below. Stockholder approval of all the proposals is a condition to the completion of the conversion to primary listing on the Hong Kong Stock Exchange.

Subject to receiving stockholder approval of all proposed items at the Special Meeting and obtaining the necessary approvals from the Hong Kong Stock Exchange, the Primary Conversion Effective Date is expected to be October 24, 2022.

The Company believes that the continuing authority of the Board to issue shares, repurchase shares and grant equity awards under the 2022 LTIP as contemplated by these proposals is critical to the Company’s business and operations. If stockholders fail to approve any of the Items of Business for which the Special Meeting is called, the Primary Conversion shall not become effective.

IN THE EVENT THAT THE PRIMARY CONVERSION DOES NOT BECOME EFFECTIVE, THE COMPANY AND ITS BOARD WILL RETAIN THE ABILITY TO AUTHORIZE AND CARRY OUT STOCK ISSUANCES AND STOCK REPURCHASES TO THE FULL EXTENT PERMITTED UNDER APPLICABLE U.S. FEDERAL LAW, DELAWARE LAW, THE NYSE LISTING STANDARDS, AND THE COMPANY’S ORGANIZATIONAL DOCUMENTS.

Pursuant to the Company’s Amended and Restated Bylaws, only business within the purpose or purposes described in the notice of special meeting may be conducted at a special meeting. Accordingly, the only matters that will be brought before the Special Meeting are those described in the Notice.

You received these materials because our Board of Directors is soliciting your proxy to vote your shares at the Special Meeting. As a stockholder of record as of the close of

business on August 24, 2022, you are invited to attend the Special Meeting and are entitled to vote on the Items of Business described in this proxy statement.

The Special Meeting will be held in a virtual-only format, through a live audio webcast. The Special Meeting will only be conducted via webcast; there will be no physical meeting location. Stockholders of record as of the close of business on August 24, 2022 and the general public will be able to attend the Special Meeting by visiting our Special Meeting website at www.virtualshareholdermeeting.com/YUMC2022SM. To participate in the Special Meeting, you will need the 16-digit control number included on your

proxy card or on the instructions that accompanied your proxy materials.

The Special Meeting will begin promptly at 8:00 a.m. Beijing/Hong Kong time on Tuesday, October 11, 2022 / 8:00 p.m. U.S. Eastern time on Monday, October 10, 2022. Online check-in will begin 15 minutes prior to the start of the meeting, and you should allow ample time for the online check-in procedures. We encourage our stockholders to access the meeting prior to the start time.

Yes. Stockholders will have the ability to submit questions during the Special Meeting via the Special Meeting website. As part of the Special Meeting, we will hold a live Q&A session, during which we intend to answer all

questions submitted during the meeting in accordance with the Special Meeting’s Rules of Conduct which are pertinent to the Company and the meeting matters, as time permits.

You may vote if you owned any shares of Company common stock as of the close of business on the record date, August 24, 2022. Each share of Company common stock

is entitled to one vote. As of August 24, 2022, there were 419,620,866 shares of Company common stock outstanding.

You will be voting on the following three Items of Business at the Special Meeting:

Pursuant to the Company’s Amended and Restated Bylaws, only business within the purpose or purposes described in the notice of special meeting may be conducted at a special meeting. Accordingly, the only matters that will be brought before the Special Meeting are those described in the Notice.

THE PRIMARY CONVERSION SHALL NOT BECOME EFFECTIVE IF STOCKHOLDERS FAIL TO APPROVE ANY OF THE ITEMS OF BUSINESS FOR WHICH THE SPECIAL MEETING IS CALLED.

Our Board of Directors recommends that you vote your shares:

There are three ways to vote before the meeting:

Proxies submitted through the Internet or by telephone as described above must be received by 11:59 a.m. Beijing/Hong Kong time on October 10, 2022 / 11:59 p.m. U.S. Eastern time on October 9, 2022. Proxies submitted by mail must be received prior to the meeting.

If you hold your shares in the name of a bank, broker, or other nominee, your ability to vote before the Special Meeting depends on their voting processes. Please follow the directions of your bank, broker, or other nominee carefully.

Yes. To vote during the Special Meeting, you will need the 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials. Even if you plan to attend the Special Meeting, we encourage you to vote your shares by proxy. You may still vote your shares during the Special Meeting even if you have previously voted by proxy.

If you hold your shares in the name of a bank, broker, or other nominee, your ability to vote during the Special Meeting depends on their voting processes. Please follow the directions of your bank, broker, or other nominee carefully.

You may change your vote at any time before the polls close at the Special Meeting. You may do this by:

Taking the above steps will result in the revocation of your prior vote or votes.

If you hold your shares in the name of a bank, broker, or other nominee, your ability change your vote depends on their voting processes. Please follow the directions of your bank, broker, or other nominee carefully.

If you vote by proxy card, your shares will be voted as you instruct by the individuals named on the proxy card. If you sign and return a proxy card but do not specify how your

shares are to be voted, the persons named as proxies on the proxy card will vote your shares in accordance with the recommendations of the Board set forth on page 5.

If you received more than one proxy card, it means that you have multiple accounts with brokers and/or our transfer agent. Please vote all of these shares. We recommend that you contact your broker and/or our transfer agent to consolidate as many accounts as possible under the same name and address. Our U.S. transfer agent is Computer-

share Trust Company, N.A., which may be reached at 1 (877) 854-0865 (U.S.) and 1 (781) 575-3102 (International). Computershare Investor Services Limited, which can be reached at 852-2862-8500 (Hong Kong), acts as our co-transfer agent to maintain the Hong Kong share register.

The matters to be voted on at our Special Meeting are not considered “routine” under applicable rules. When a matter is not a routine matter and the brokerage firm has not received voting instructions from the beneficial owner of the shares with respect to that matter, the brokerage firm

cannot vote the shares on that proposal. This is called a “broker non-vote.” Because there are no routine matters on which brokerage firms can vote without instruction, no broker non-votes are expected at the Special Meeting.

Your shares are counted as present at the Special Meeting if you attend the Special Meeting via webcast using your 16-digit control number or if you properly submit a proxy by Internet, telephone, or mail. In order for us to conduct our Special Meeting, a majority of the shares of Company

common stock outstanding as of August 24, 2022 must be present via webcast or represented by proxy at the Special Meeting. This is referred to as a “quorum.” Abstentions will be counted for purposes of establishing a quorum at the Special Meeting.

Proposals 1, 2, and 3 must receive the “FOR” vote of a majority of the shares of our common stock, present via webcast or represented by proxy, and entitled to vote at the Special Meeting. For each of the proposals, you may vote “FOR,” “AGAINST,” or “ABSTAIN.” Abstentions will be counted as shares present and entitled to vote at the Special Meeting. Accordingly, abstentions will have the

same effect as a vote “AGAINST” proposals 1, 2, and 3. Because matters to be voted on at our Special Meeting are not considered “routine,” broker non-votes will not be counted as shares present and entitled to vote with respect to any particular matter on which the broker has not voted. Thus, broker non-votes will not affect the outcome of these proposals.

The Company will announce the voting results of the Special Meeting on a Current Report on Form 8-K filed with the SEC within four business days of the Special

Meeting. The voting results will also be filed with Hong Kong Stock Exchange simultaneously.

The Company knows of no other matters to be submitted to the stockholders at the Special Meeting, other than the proposals referred to in this proxy statement. If any other matters properly come before the stockholders at the

Special Meeting, it is the intention of the persons named on the proxy card to vote the shares represented thereby on such matters in accordance with their best judgment.

Prior to the Primary Conversion Effective Date, the Board’s authority includes the ability to issue shares. Such authority is generally on par with other NYSE-listed U.S. companies. However, under the Hong Kong Listing Rules, a primary-listed company must have authority from its stockholders to issue any shares, including shares that are part of the company’s authorized but unissued share capital, unless they are offered to existing stockholders pro-rata to their existing holdings. Approval of this proposal will permit the Board the authority to authorize the Company to issue shares in compliance with the Hong Kong Listing Rules to the same extent already authorized under our Amended and Restated Certificate of Incorporation and the rules of the NYSE. We are not asking you to approve an increase in our authorized share capital.

In light of the dynamics of the China market in which it operates, the Company has always believed in maintaining a strong balance sheet and maximum financial flexibility. This authority will enable the Company to address business contingency and capture growth opportunities, in accordance with its long-term strategic goals, in a timely manner. Consistent with its past practice, the Board will authorize future issuances of securities only if it determines that such issuances are in the best interests of the Company and its stockholders. The Board has no immediate plans to issue any shares pursuant to this authorization and we are not asking you to approve a specific issuance of shares.

Furthermore, the Company does not intend to issue any shares under this authority at a discount of more than 10% to the “benchmarked price” (as described in Rule 13.36(5) of the Hong Kong Listing Rules), which is more restrictive than the maximum discount of 20% permitted under the Hong Kong Listing Rules.

Granting the Board this authority is an annual, routine matter for primary-listed companies on the Hong Kong Stock Exchange. In accordance with the Hong Kong Listing Rules, it is a customary practice for primary-listed companies on the Hong Kong Stock Exchange to seek stockholder authority to issue up to 20% of a company’s outstanding shares and for such authority to be effective until the next annual meeting, unless otherwise earlier revoked or modified by a duly adopted resolution of the stockholders. June 26, 2023 is the thirteen-month anniversary of the 2022 Annual Meeting and reflects the end date of the authorization, after which the authorization cannot extend. Therefore, consistent with this market practice, and as allowed under the Hong Kong Listing Rules, we are seeking approval for continuing authority for the Board to authorize the Company to issue common stock or securities convertible into common stock up to a maximum of 20% of our outstanding shares as of the date of the Special Meeting, for a period from the Primary Conversion Effective Date until the earlier of the 2023 Annual Meeting of Stockholders or June 26, 2023. We expect to propose a renewal of this authorization at our 2023 Annual Meeting of Stockholders, and then annually thereafter. Pursuant to this proposal, assuming for illustrative purposes that our outstanding shares remain unchanged from August 24, 2022 to the date of the Special Meeting, the Company will be allowed to issue a maximum of 83,924,173 shares of common stock.

The approval of this proposal is a condition for the Primary Conversion to become effective.

In the event that the Primary Conversion does not become effective, the Company and its Board will retain the ability to authorize and carry out stock issuances to the full extent permitted under applicable U.S. federal law, Delaware law, the

NYSE listing standards, and the Company’s organizational documents notwithstanding the outcome of this vote.

Accordingly, we ask our stockholders to vote in favor of the following resolution at the Special Meeting:

To approve the Board’s continuing authority to approve the Company’s issuance of shares of its common stock or securities convertible into common stock in an amount not to exceed 20% of the total number of outstanding shares of common stock of the Company as of the date of the Special Meeting, effective from the Primary Conversion Effective Date until the earlier of the date the next annual meeting is held or June 26, 2023.

For clarity, this authority will include the authority to issue securities convertible into shares of common stock, or options, warrants or similar rights to subscribe for shares of common stock or such convertible securities of the Company and to make or grant offers, agreements and/or options (including bonds, warrants and debentures convertible into shares of common stock), subject to the limitations described in the resolution set forth above.

What vote is required to approve this proposal?

Approval of this proposal requires the affirmative vote of a majority of shares present via webcast or represented by proxy and entitled to vote at the Special Meeting.

The Board of Directors recommends that stockholders vote FOR the approval of this proposal.

This section serves as a reference to the explanatory statement pursuant to Rule 10.06(1)(b) of the Hong Kong Listing Rules to provide information for our stockholders to make a reasonably informed decision on whether to vote for or against the resolution with respect to the authorization to repurchase shares to be proposed at the Special Meeting.

We have historically used share repurchases as a means of returning cash to stockholders. The Board believes that, after we become a primary-listed company on the Hong Kong Stock Exchange it is in the best interests of the Company and our stockholders to continue have a general authority from our stockholders to enable our Company to purchase shares of common stock in the markets. Further, the Company prioritizes the equality of our stockholders, regardless of the exchange on which the shares they hold trade. After we become a primary-listed company on the Hong Kong Stock Exchange, our goal is to maintain that priority and ensure that our stockholders holding our shares that trade on the Hong Kong Stock Exchange are also allowed the benefit of our share repurchase program.

The Company first adopted a share repurchase program in the U.S. in 2017 (the “U.S. Repurchase Program”) and has increased the authorization thereunder from time to time. The Company has also adopted plans in compliance with Rule 10b5-1 and/or Rule 10b-18 of the Securities Exchange Act of 1934 (the “Exchange Act”) to effect repurchases under the U.S. Repurchase Program. After we become a primary-listed company on the Hong Kong Stock Exchange, we intend to carry on the U.S. Repurchase Program. It is also anticipated that we will adopt a share repurchase program in Hong Kong which is analogous to the U.S. Repurchase Program after the Primary Conversion.

Under the Hong Kong Listing Rules, a primary-listed company must obtain authority from its stockholders to repurchase its shares on the Hong Kong Stock Exchange if it wishes to conduct share repurchases on the Hong Kong Stock Exchange. Granting the Company this authority is a routine matter for primary-listed companies on the Hong Kong Stock Exchange and is consistent with

market practice. After we become a primary-listed company on the Hong Kong Stock Exchange, we expect to propose a renewal of this authorization during our 2023 Annual Meeting of Stockholders and annually thereafter. Without this authority, the Company’s ability to repurchase shares would be limited to the repurchase of shares that trade on the NYSE and would not include repurchases on the Hong Kong Stock Exchange. Granting the Company this authority will ensure continuous parity between investors who hold our shares that trade on the NYSE and investors that hold our shares on the Hong Kong Stock Exchange. Any repurchases made in Hong Kong or the United States will reduce the available authority under the repurchase mandate and the repurchase authorization.

In connection with the authorizations established by the Board regarding our share repurchase programs, these repurchases would be made only at price levels that the Company would consider to be in the best interests of the stockholders generally, after taking into account the Company’s overall financial position. Our Board of Directors has authorized an aggregate of $2.4 billion for our share repurchase program, including its most recent increase in authorization in March 2022. As of June 30, 2022, approximately $1.2 billion remained available under that program. As a Delaware corporation, we are bound by the requirements the Delaware General Corporation Law, which prohibits a corporation from purchasing its shares of capital stock when the purchase would cause any impairment of our capital, as well as applicable SEC and NYSE requirements.

Share Capital

As of August 24, 2022, the total number of outstanding shares of common stock of the Company was 419,620,866. Pursuant to this proposal, and assuming for illustrative purposes that our outstanding shares remain unchanged from August 24, 2022 to the date of the Special Meeting, we are seeking continuing authority to repurchase up to a maximum of 41,962,086 shares of common stock, representing 10% of our outstanding

shares as of the date of the Special Meeting. The authority will be effective for a period from the Primary Conversion Effective Date until the earlier of the 2023 Annual Meeting of Stockholders or June 26, 2023, unless earlier revoked or modified by a duly adopted resolution of the stockholders. As noted, June 26, 2023 is the thirteen-month anniversary of the 2022 Annual Meeting and reflects the end date of the authorization, after which the authorization cannot extend.

Funding of Repurchase

The repurchases may depend on market conditions and funding arrangements at the time and will be made only when the Company believes that such repurchases will benefit the Company and our stockholders. Repurchases of shares of common stock will be funded out of funds legally available for such purposes in accordance with the Company’s Amended and Restated Bylaws, the Hong Kong Listing Rules, applicable U.S. federal law, Delaware law, the NYSE listing standards, and other applicable laws and regulations in U.S. and Hong Kong.

Impact of Repurchases

The repurchase of common stock pursuant to this proposal may have a material adverse impact on the working capital or leverage of the Company as compared with the position as at June 30, 2022 in the event that the proposed repurchases were to be carried out in full at any time during proposed repurchase period. However, our directors are subject to fiduciary duties to the Company and are bound by the requirements the Delaware General Corporation Law, which prohibits a corporation from purchasing its shares of capital stock when the purchase would cause any impairment of our capital.

The Code on Takeovers and Mergers (the “Takeovers Code”)

If, as a result of a repurchase pursuant to the authorization to repurchase shares, a stockholder’s proportionate interest in the voting rights of our Company increases, such increase will be treated as an acquisition of voting rights for the purposes of the Takeovers Code. Accordingly, a stockholder, or a group of stockholders acting in concert (within the meaning under the Takeovers Code), depend-

ing on the level of increase in the stockholder’s interest, could obtain or consolidate control of our Company and thereby become obliged to make a mandatory offer in accordance with Rule 26 of the Takeovers Code.

As of August 24, 2022, to the best knowledge and belief of our Board of Directors, our largest stockholder beneficially owned 40,727,617 shares of common stock, representing approximately 9.7% of our outstanding shares, based on Amendment No. 3 to the Schedule 13G filed on February 10, 2022 with the SEC by the stockholder. In the event that our Board of Directors should exercise in full the authorization to repurchase shares, the shareholding of our largest stockholder will be increased to approximately 10.8% of our outstanding shares.

To the best knowledge and belief of our Board of Directors, such increase would not give rise to an obligation to make a mandatory offer under the Takeovers Code. Our Board of Directors has no present intention to repurchase the shares of common stock to the extent that will trigger the obligations under the Takeovers Code for our largest stockholder to make a mandatory offer. Our Board of Directors is not aware of any other consequences which may arise under the Takeovers Code as a result of a repurchase pursuant to the authorization to repurchase shares. The Hong Kong Listing Rules prohibit a company from buying back shares on the Hong Kong Stock Exchange if the result of the repurchases would be that less than 25% (or such other prescribed minimum percentage as determined by the Hong Kong Stock Exchange) of our outstanding shares would be in public hands. Our Board of Directors does not propose to repurchase shares which would result in less than the prescribed minimum percentage of shares of common stock in public hands.

Market Prices of Shares

This section includes information required to be provided pursuant to Rule 10.06(1)(b) of the Hong Kong Listing Rules. While our shares are primary listed on the NYSE, the information set forth below relates exclusively to our secondary listing on the Hong Kong Stock Exchange and is therefore provided in Hong Kong dollars. The below values do not represent trading prices of our shares on the NYSE.

The shares of common stock were listed on the Hong Kong Stock Exchange on September 10, 2020. The following table sets forth the highest and lowest prices at which the shares of common stock traded on the Hong Kong Stock Exchange during each month during the previous twelve months and until July 2022:

Yum China’s Highest and Lowest Monthly Close Price (July 2021 – July 2022)

Repurchases of Shares

For the year ended December 31, 2021 and the six months ended June 30, 2022, we repurchased approximately 1.3 million shares and 9 million shares of our common stock in open market transactions for a total cost of approximately $75 million and $400 million, respectively.

The approval of this proposal is a condition for the Primary Conversion to become effective.

In the event that the Primary Conversion does not become effective, the Company and its Board will retain the ability to authorize and carry out stock repurchases to the full extent permitted under applicable U.S. federal law, Delaware law, the NYSE listing standards, and the Company’s organizational documents, notwithstanding the outcome of this vote.

Accordingly, we ask our stockholders to vote in favor of the following resolution at the Special Meeting:

To approve the Board’s continuing authority to approve the Company’s repurchase of shares of its common stock in an amount not to exceed 10% of the total number of outstanding shares of common stock of the Company as of the date of the Special Meeting, effective from the Primary Conversion Effective Date until the earlier of the date the next annual meeting is held or June 26, 2023.

What vote is required to approve this proposal?

Approval of this proposal requires the affirmative vote of a majority of shares present via webcast or represented by proxy and entitled to vote at the Special Meeting.

The Board of Directors recommends that stockholders vote FOR the approval of this proposal.

On September 1, 2022, the Board approved the Yum China Holdings, Inc. 2022 Long Term Incentive Plan (the “2022 LTIP”), subject to approval by our stockholders at the Special Meeting. Following approval by our stockholders at the Special Meeting, the 2022 LTIP will become effective upon consummation of the Primary Conversion in accordance with its terms.

If the 2022 LTIP is approved by stockholders, the 2022 LTIP will replace the Yum China Holdings, Inc. Long Term Incentive Plan (the “2016 LTIP”), which was adopted in connection with our spin-off from Yum! Brands, Inc. (“YUM”). No new awards will be granted under the 2016 LTIP after the 2022 LTIP becomes effective, but the 2016 LTIP will continue to govern awards granted under the 2016 LTIP prior to the effectiveness of the 2022 LTIP. After the 2022 LTIP becomes effective upon consummation of the Primary Conversion, we will be able to make awards of long-term equity incentives under the 2022 LTIP, which we believe are critical for attracting, motivating, rewarding and retaining a talented team who will contribute to our success.

If the 2022 LTIP is not approved by our stockholders or the Primary Conversation does not become effective, the Company will continue to operate the 2016 LTIP pursuant to its current provisions and grant awards under the 2016 LTIP.

The 2022 LTIP is largely based on the 2016 LTIP, but with updates to conform to the Hong Kong Listing Rules, to delete provisions relating to our spin-off that are no longer applicable and to make certain other administrative changes. The 2022 LTIP will be subject to the requirements under Chapter 17 of the Hong Kong Listing Rules, as amended, supplemented or otherwise modified from time to time.

Equity Grant Practices

We attempt to manage our long-term shareholder dilution by limiting the number of equity incentive awards we grant annually. The Compensation Committee carefully monitors our annual burn rate, total dilution, and equity expense in order to maximize shareholder value by granting only the number of equity incentive awards that it believes is necessary to attract, reward, and retain employees.

As of August 24, 2022, there were 2,069,722 shares of Company common stock subject to restricted stock unit (“RSU”) and performance stock unit (“PSU”) awards granted and outstanding under the 2016 LTIP (assuming achievement of the target vesting level for the outstanding PSUs). Under the terms of the award agreements, the vesting levels for PSU awards may range from 0% to 200% of target (or, in some cases, 240% of target), depending on achievement against the applicable performance goals with respect to such awards. As of August 24, 2022, there were 10,391,188 shares of Company common stock subject to stock options and stock appreciation rights (“SARs”) outstanding under the 2016 LTIP. As of that date, the weighted average base price of our outstanding SARs and stock options was $33.96, and the weighted average remaining contractual term for the outstanding SARs and stock options was 5.10 years. As of August 24, 2022, there were 9,559,849 shares of Company common stock that remained available for future issuances under the 2016 LTIP (assuming outstanding performance awards are counted at the maximum vesting level and applying the two-for-one fungible share ratio applicable to RSU and PSU awards). If our stockholders approve the 2022 LTIP, then after the 2022 LTIP becomes effective upon consummation of the Primary Conversion, we will not make any additional awards under the 2016 LTIP.

Burn rate is a measure of the number of shares subject to equity awards that we grant annually, which helps indicate the life expectancy of our equity plans and is a measure of stockholder dilution. We determine our burn rate

by dividing the aggregate number of shares subject to awards granted during the year by the weighted average number of shares outstanding during the year. Our burn rate for the past three fiscal years has been as follows:

Our three-year average burn rate is 0.53%. Applying the two-for-one fungible share ratio applicable to full value awards granted under the 2016 LTIP would result in a three-year average burn rate of 0.72%.

Certain Corporate Governance Features of the 2022 LTIP

The following features of the 2022 LTIP are designed to reinforce alignment between the equity compensation arrangements awarded pursuant to the 2022 LTIP and our stockholders’ interests:

Purposes of the 2022 LTIP

Equity-based compensation is a significant component of our compensation program and the 2022 LTIP is intended to serve the following purposes:

Under the 2022 LTIP, the Company may grant:

Description of the 2022 LTIP

The following description is qualified in its entirety by reference to the plan document, a copy of which is attached as Appendix A and incorporated into this proxy statement by reference.

Administration

The 2022 LTIP is administered by a “Committee” selected by the Board consisting of two or more non-employee members of the Board or, if no Committee is selected or for any other reason determined by the Board, the Board may take any action under the 2022 LTIP that would otherwise be the responsibility of the Committee. The Compensation Committee currently serves as the “Committee” under the 2016 LTIP and is expected to serve as the “Committee” under the 2022 LTIP. The members of the Compensation Committee meet the independence requirements of the NYSE.

Subject to the express provisions of the 2022 LTIP, the Committee has the authority and discretion to, among other items, (a) select from among the eligible individuals

those persons who will receive awards under the 2022 LTIP, (b) determine the time or times of receipt, (c) determine the types of awards and the number of shares covered by the awards, (d) establish the terms, conditions, performance targets, restrictions and other provisions of such awards, and, subject to the terms and conditions of the 2022 LTIP, cancel or suspend awards or accelerate the exercisability or vesting of any award, (e) to the extent that the Committee determines that the restrictions imposed by the 2022 LTIP preclude the achievement of the material purposes of the awards in jurisdictions outside the United States, modify those restrictions as the Committee determines to be necessary or appropriate to conform to applicable requirements or practices of jurisdictions outside of the United States, (f) conclusively interpret the 2022 LTIP, (g) establish, amend and rescind any rules and regulations relating to the 2022 LTIP, (h) determine the terms and provisions of any award agreement made pursuant to the 2022 LTIP and (i) make all other determinations that may be necessary or advisable for the administration of the 2022 LTIP.

Except to the extent prohibited by applicable law or the applicable rules of a stock exchange on which shares of the Company’s common stock are listed, the Committee may allocate all or any portion of its responsibilities and powers to any one or more of its members and may delegate all or any part of its responsibilities and powers to any person or persons selected by it.

Available Shares

Subject to the capitalization adjustment provisions included in the 2022 LTIP, the maximum number of shares of Company common stock that may be delivered to participants and their beneficiaries in respect of all awards to be granted under the 2022 LTIP will be the lower of (i) 31,000,000 shares and (ii) 10% of the total number of shares of Company common stock outstanding as of the date of the Special Meeting (the “10% Limit”), reduced by the number of shares (or, with respect to Full Value Awards, two times the number of shares) subject to any grants that occur under the 2016 LTIP between August 24, 2022 and the effectiveness of the 2022 LTIP. The number of shares that may be delivered to participants and their beneficiaries under the 2022 LTIP may be increased by our stockholders in a general meeting after

three years from the date of their approval of the previous increase (or the date of the adoption of the 2022 LTIP). Additional increases within any three-year period must be approved by our independent stockholders in a manner compliant with Chapter 17 of the Hong Kong Listing Rules in force from time to time. Any increase to the share limit under the 2022 LTIP may not result in the number of shares of Company common stock that may be delivered to participants and their beneficiaries under the 2022 LTIP exceeding 10% of the total number of shares outstanding as of the date our stockholders approve such increase. On the record date, the closing sales price per share of Company common stock as reported on the NYSE was $48.09. Shares available under the 2022 LTIP will be authorized but unissued shares.

To the extent shares subject to an award granted under the 2022 LTIP were not issued or delivered by reason of (i) lapse of awards due to termination, expiration or forfeiture of such award, (ii) the settlement of such award in cash, or (iii) the withholding of such shares by the Company to satisfy the applicable tax withholding obligation or exercise price (by way of net settlement or net exercise), in each case, then such shares will not reduce the number of shares remaining available for issuance under the 2022 LTIP. Only the shares subject to a stock-settled SAR that are issued to a participant upon exercise of such stock-settled SAR will reduce the number of shares remaining available for issuance under the 2022 LTIP. In addition, subject to the 10% Limit, (x) shares withheld by the Company after August 24, 2022 to pay the withholding taxes related to an outstanding award granted under the 2016 LTIP and (y) shares subject to awards granted under the 2016 LTIP between August 24, 2022 and the date of the Special Meeting which are not delivered to a participant or beneficiary because they have lapsed in accordance with the terms of the 2016 LTIP, including due to forfeiture, termination, or expiration of the award, in each case, will also become available for grant under the 2022 LTIP.

The 2022 LTIP uses a fungible share counting method, such that Full Value Awards reduce the 2022 LTIP’s share reserve at a ratio of two shares for every share subject to the Full Value Award and stock options and SARs will reduce the share reserve on a one-for-one basis.

Other Share Limits

Under the terms of the 2022 LTIP, (i) the number of shares initially available for grants of incentive stock options under the 2022 LTIP equals 31,000,000, subject to any lower limits imposed under the Hong Kong Listing Rules or the rules of the NYSE; (ii) the maximum number of shares that may be covered by stock options or SARs granted to any one individual during any five calendar-year period will be 9,000,000; (iii) for Full Value Awards, no more than 3,000,000 shares may be subject to Full Value Awards granted to any one individual during any five-calendar-year period; and (iv) a non-employee director may not be granted during any calendar year an award or awards having a value determined on the grant date in excess of $1,500,000.

In addition, to the extent any grant of an award to any one individual would result in the shares issued or to be issued in respect of all awards granted to such individual (excluding any awards that have been forfeited or lapsed in accordance with the terms of the 2022 LTIP) in the 12-month period up to and including the date of such grant representing in the aggregate more than the limit set out in the Hong Kong Listing Rules (currently 1% of the shares of the Company issued as of such date), then such grant must be separately approved by our stockholders in accordance with the Hong Kong Listing Rules. Pursuant to the Hong Kong Listing Rules, if (i) a grant of an award (excluding options and SARs) (the “Other Equity Awards”) to any one of our directors whose role is executive in nature or our Chief Executive Officer or any of their associates would result in the shares issued and the shares to be issued in respect of all Other Equity Awards granted (excluding the awards lapsed in accordance with the 2022 LTIP) in the 12-month period up to and including the date of such grant representing in aggregate over 0.1% of the total issued shares on the date of such grant, or (ii) a grant of an award (including options, SARs and any other types of share awards) to any one of our independent directors or substantial shareholder of the Company or any of their associates would result in the shares issued and the shares to be issued in respect of all awards (excluding the awards lapsed in accordance with the 2022 LTIP) in the 12-month period up to and including the date of such grant representing in aggregate over 0.1% of the total issued shares on

the date of such grant, such further grant exceeding the 0.1% limit must be approved by our stockholders.

Change in Control

Unless otherwise provided in the 2022 LTIP or an award agreement, in the event a participant’s employment is involuntarily terminated by the Company other than for cause on or within two years following a change in control of the Company, then (i) all outstanding options (regardless of whether in tandem with SARs) will become fully exercisable, (ii) all outstanding SARs (regardless of whether in tandem with options) will become fully exercisable, and (iii) all Full Value Awards will become fully vested and the Committee will determine the extent to which any applicable performance conditions have been met in accordance with the terms of the 2022 LTIP and the applicable award agreement. In no event will the application of this provision cause the vesting period of any award held by a participant who is not an Employee Participant (as defined below) to be less than 12 months.

Under the terms of the 2022 LTIP, a change in control is generally defined as (i) a change in our Board resulting in the incumbent directors ceasing to constitute at least a majority of our Board, (ii) certain acquisitions of 35% or more of the Company’s then outstanding securities eligible to vote for the election of our Board, or (iii) the consummation of certain mergers or consolidations involving the Company or any of its subsidiaries.

No Repricing

Other than pursuant to the adjustment provisions described below or as approved by the Company’s stockholders, the exercise price for any outstanding option or SAR may not be decreased and no outstanding option or SAR may be surrendered to the Company in exchange for a replacement option or SAR with a lower exercise price or a Full Value Award. Except as approved by the Company’s stockholders, no option or SAR may be surrendered to the Company in consideration for a cash payment if, at the time of such surrender, the exercise price of the option or SAR is greater than the then current fair market value of a share of Company common stock.

Restrictions, Misconduct and Recoupment

The Committee, in its discretion, may impose such restrictions on shares of stock acquired pursuant to the 2022 LTIP, whether pursuant to the exercise of a stock option or SAR, settlement of a Full Value Award or otherwise, as it determines to be desirable, including restrictions relating to disposition of the shares and forfeiture restrictions based on service, performance, stock ownership by the participant, conformity with our recoupment, compensation recovery or clawback policies and such other factors as the Committee determines to be appropriate.

If the Committee determines that a present or former employee has (a) used for profit or disclosed to unauthorized persons, confidential or trade secrets of the Company or our subsidiaries, (b) breached any contract with or violated any fiduciary obligation to the Company or our subsidiaries, or (c) engaged in any conduct which the Committee determines is injurious to us or our subsidiaries, the Committee may cause that employee to forfeit his or her outstanding awards under the 2022 LTIP. This provision does not apply during any period where there is a potential change in control in effect or following a change in control.

Effective Date, Termination and Amendment

The 2022 LTIP will become effective upon consummation of the Primary Conversion and will terminate on the ten-year anniversary of its approval by our stockholders. Subject to applicable law and the listing rules of the NYSE and the Hong Kong Stock Exchange, the Board may, at any time, amend or terminate the 2022 LTIP (and the Committee may amend any award agreement). However, no amendment or termination of the 2022 LTIP or amendment of any award agreement may, in the absence of written consent to the change by the affected participant or beneficiary, if applicable, adversely affect in any material way the rights of any participant or beneficiary under any award granted under the 2022 LTIP prior to the date of such amendment or termination, unless the Committee expressly reserved the right to do so at the time the award was granted. Adjustments pursuant to corporate transactions and restructurings are not subject to the foregoing limitations. In addition, all material amendments to the 2022 LTIP, including but not limited to amendments to

the provisions of the 2022 LTIP that prohibit the repricing of stock options and SARs, amendments expanding the group of eligible individuals, or amendments increasing the aggregate number of shares reserved under the 2022 LTIP, the shares that may be issued in the form of incentive stock options, the individual limits on awards and the limitations on awards, will not be effective unless approved by our stockholders, in each case, to the extent required by applicable law. In addition, no amendment will be made to the 2022 LTIP, applicable award agreements or the terms of award granted under the 2022 LTIP without the approval of our stockholders, the Board, the independent directors of the Board or the Committee, as applicable, if such approval is required by law or the rules of any stock exchange on which shares of the Company common stock are listed, including the rules of the NYSE and the Hong Kong Stock Exchange. Further, the amended Plan or the amended award agreement must still comply with the relevant applicable laws or applicable rules of any stock exchange on which the Stock is listed. Upon termination of the 2022 LTIP, no further award will be offered but the provisions of the 2022 LTIP will remain in full force and effect with respect to awards granted prior to the termination of the 2022 LTIP, and termination of the 2022 LTIP will not affect the terms or conditions of any award granted prior to termination. Awards granted prior to such termination will continue to be valid and exercisable in accordance with the 2022 LTIP.

Eligibility

Participants in the 2022 LTIP will consist of such officers, directors or other employees of the Company, its subsidiaries or its associated companies in which the Company has an equity interest and persons who are expected to become officers, employees or directors of the Company or a subsidiary or an associated company in which the Company has an equity interest, as may be selected by the Committee. Grants of awards under the 2022 LTIP will be made based on the basis of the contributions of participants to the development and growth of the Company, as determined by the Company and, except as required by applicable law, the participant is not required to pay any amount in order to apply or accept an award.

As of July 31, 2022, approximately 400,000 employees, including ten executive officers, and nine non-employee

directors would be eligible to participate in the 2022 LTIP if selected by the Committee.

Performance Measures

Performance measures used with respect to performance-based awards granted under the 2022 LTIP may include any one or more of the following corporate-wide or subsidiary, division, operating unit, line of business, project, geographic or individual measures: cash flow; earnings; earnings per share; market value added or economic value added; profits; return on assets; return on equity; return on investment; sales; revenues; stock price; total shareholder return; customer satisfaction metrics; restaurant unit development; and such other goals as the Committee may determine whether or not listed in the 2022 LTIP, or any combination of the foregoing.

Minimum Vesting Conditions

Notwithstanding any other provision of the 2022 LTIP to the contrary, awards granted under the 2022 LTIP (other than cash-based awards) will vest no earlier than the first anniversary of the date on which the award is granted; provided, that the following awards granted to directors, officers or other employees of the Company or any of its subsidiaries and persons who are expected to become directors, officers or other employees of the Company or any of its subsidiaries (“Employee Participants”) will not be subject to the foregoing minimum vesting requirement: any (i) substitute awards granted in connection with awards that are assumed, converted or substituted pursuant to a merger, acquisition or similar transaction entered into by the Company or any of its subsidiaries, (ii) awards to non-employee directors that vest on earlier of the one-year anniversary of the date of grant and the next annual meeting of stockholders which is at least 50 weeks after the immediately preceding year’s annual meeting, and (iii) additional awards the Committee may grant, up to a maximum of five percent (5%) of the available share reserve authorized for issuance under the 2022 LTIP (subject to adjustment under the corporate capitalization provisions under the 2022 LTIP) in respect of (A) sign-on or make-whole grants to new Employee Participants, (B) grants of awards with performance-based vesting conditions, (C) grants of awards that are made in batches for administrative or compliance reasons, (D) grants of

awards that vest evenly over a period of 12 months or more, (E) grants of awards with a total vesting and holding period of more than 12 months and (F) shares subject to a minimum holding period of 12 months which are delivered to an Employee Participant under his or her compensation arrangements with the Company (including shares of Company common stock delivered to non-employee directors in respect of their annual retainers).

The Board and the Committee believe that the types of awards described in clauses (i) to (iii) in the previous paragraph are appropriate and align with the purposes of the 2022 LTIP (i.e., to attract and retain individuals to the Company, motivate performance, provide competitive incentive opportunities and align the interests of participants with those of our stockholders). In clause (i), in the context of an acquisition of a target, the transaction may involve the assumption of equity awards granted to the target’s employees. Because the equity awards with respect to the target would represent a contractual arrangement between the target and the participant, the Company would not be able to unilaterally change the terms in a way that would be adverse to the interests of the participant. As such, the Company needs flexibility to grant equity awards with vesting schedules of less than one year to the extent the corresponding award of the target had a vesting schedule of less than one year. In the case of awards described in clause (ii), the Committee believes that such awards are appropriate and align with the purposes of the 2022 LTIP as such grants would coincide with the directors’ term in office generally. The exception in clause (ii) would allow the award to vest if the next annual meeting at which directors are elected falls short of the 12-month anniversary of the date of grant, which happens on occasion. In such instance, any director that does not stand for re-election would still vest in his/her award since they served the full term, provided that the annual meeting occurs at least 50 weeks following the prior annual meeting. Clauses (iii)(A)-(iii)(F) provide the Board and the Committee with the flexibility to grant awards from a limited pool of shares. Sign-on and make-whole grants assist the Company in attracting key talent; awards with performance-based vesting conditions align the interests of participants with those of our stockholders and provide competitive incentive compensation opportunities; and in the event of equity granted to settle compensation that had already

been earned by the participant, to require the Company to include an additional vesting condition of at least 12 months would impair the Company’s ability to stock-settle fully earned awards when the circumstances warranted it and would be unfair to the participants who had already earned such retainer or payment. The 12-month minimum vesting requirement does not apply to the Committee’s discretion to provide for accelerated exercisability or vesting of any award in cases of retirement, separation, retention arrangements, death, disability or a change in control, to the extent set forth in the terms of the award agreement or otherwise. The Committee believes that its ability to provide for the accelerated exercisability or vesting of an award in such cases allows it to attract and retain individuals to provide services to the Company and its subsidiaries, and to provide for succession planning and the effective transition of employee responsibilities.

Stock Options and SARs

The 2022 LTIP provides for the grant of stock options and SARs. A SAR entitles the holder to receive upon exercise (subject to withholding taxes) cash or shares of Company common stock with an aggregate value equal to the difference between the fair market value of the shares of Company common stock on the exercise date and the exercise price of the SAR.

The Committee will determine the conditions to the exercisability of each option and SAR. Each option and SAR will be exercisable for no more than ten (10) years after its date of grant. Except in the case of substitute awards granted in connection with a corporate transaction (subject to approval, waiver, confirmation or otherwise as applicable from the Hong Kong Stock Exchange), the exercise price of an option or SAR will not be less than the higher of (i) the fair market value of a share of Company common stock on the date of grant (which must be a NYSE trading day) and (ii) the average fair market value of a share of Company common stock for the five NYSE trading days immediately preceding the date of grant (or, if greater, the par value of a share of Company common stock on such date(s)).

The exercise price of each option or SAR will be established or determined by a method established by the

Committee at the time of grant, subject to the restrictions described above.

Notwithstanding anything in the award agreement to the contrary, the holder of an option or SAR will not be entitled to receive dividend equivalents with respect to the shares of Company common stock subject to such option or SAR.

Full Value Awards and Cash Incentive Awards

A “Full Value Award” is a grant of one or more shares of Company common stock or a right to receive one or more shares of Company common stock in the future (including restricted stock, restricted stock units, performance shares and performance units) that is contingent on continuing service, the achievement of performance objectives during a specified performance period or other restrictions as determined by the Committee. The grant of Full Value Awards may also be subject to such other conditions, restrictions and contingencies, as determined by the Committee. Except as otherwise provided in the 2022 LTIP, no award under the 2022 LTIP will confer upon its holder any rights as a stockholder of the Company prior to the date on which the individual fulfills all conditions for receipt of such rights and shares are registered in his or her name.

A “Cash Incentive Award” is the grant of a right to receive a payment of cash (or in the discretion of the Committee, shares of stock having value equivalent to the cash otherwise payable) that is contingent on achievement of performance objectives over a specified period established by the Committee. The grant of Cash Incentive Awards may also be subject to such other conditions, restrictions and contingencies, as determined by the Committee.

Grants of Full Value Awards will be made based on the basis of their contributions to the development and growth of the Company and its subsidiaries, as determined by the Company, and the participant is not required to pay any purchase price of shares of Company common stock awarded under the Full Value Award and the Cash Incentive Award.

Lapse and Cancellation of Awards

Unless otherwise set forth in the award agreement or determined by the Committee, awards will cease to vest upon a termination of the participant’s employment or service with the Company or the participant ceasing to be an eligible individual under the 2022 LTIP. In the event an option or SAR expires without being exercised during the exercise period or an award does not vest, such award will lapse automatically and be forfeited and cancelled by the Company without action on the part of the participant and for no consideration and the Company will owe no liability to any participant for the lapse of any award under this paragraph.

Rights as Stockholders

The shares of Company common stock to be allotted and issued upon settlement or exercise of an award will rank pari passu in all respects with other fully-paid shares of Company common stock in issue as of the date of allotment. No participant will have any right as a stockholder of the Company with respect to any shares of Company common stock unless and until such participant becomes a stockholder of record with respect to such share of Company common stock. Once a participant becomes a stockholder of record with respect to the share of Company common stock subject to the award, the participant will have all rights as a stockholder, including, but not limited to, voting rights, the right to receive dividends and the right to participate in any capital adjustment applicable to all stockholders.

Transferability of Awards

An award will not be transferable except as designated by the participant by will or by the laws of descent and distribution or, if provided by the Committee, pursuant to a qualified domestic relations order (within the meaning of the Internal Revenue Code and applicable rules thereunder), in each case, to the extent permitted by applicable law. To the extent that a participant who receives an award under the 2022 LTIP has the right to exercise such award, the award may be exercised during the lifetime of the participant only by the participant. Notwithstanding the foregoing, if provided by the Committee and subject to approval, waiver, confirmation or otherwise (as

applicable) from the Hong Kong Stock Exchange, awards may be transferred to or for the benefit of the participant’s family (including, without limitation, to a trust or partnership for the benefit of a participant’s family), subject to such procedures as the Committee may establish. In no event will an incentive stock option be transferable to the extent that such transferability would violate the requirements applicable to such option under Section 422 of the Internal Revenue Code.

Effect of Capitalization Adjustments

In the event of a capitalization issue, rights issue, subdivision or consolidation of shares or reduction of capital, the Committee will make such equitable adjustments, in accordance with Section 409A of the Internal Revenue Code and the Hong Kong Listing Rules to the extent applicable and as it determines are necessary and appropriate, in: (i) the number and class of securities available under the 2022 LTIP; (ii) the terms of each outstanding option and SAR (including the number and class of securities subject to each outstanding option or SAR and the exercise price or base price per share); and (iii) the terms of each outstanding Full Value Award (including the number and class of securities subject thereto). Only where approval, waiver, confirmation or otherwise as applicable from the Hong Kong Stock Exchange is obtained, in the event of any other equity restructuring event as defined under Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation—Stock Compensation or any successor or replacement accounting standard, or any other change in corporate capitalization, including a merger, consolidation, reorganization, or partial or complete liquidation of the Company, such equitable adjustments described in the foregoing sentence may be made as determined to be appropriate and equitable by the Committee to prevent dilution or enlargement of rights of participants. In case of an adjustment pursuant to the adjustment provisions of the 2022 LTIP, the decision of the Committee regarding any such adjustment will be final, binding and conclusive.

New Plan Benefits

The 2022 LTIP does not provide for set benefits or amounts of awards and the Committee has not approved any awards that are conditioned on shareholder approval. The Committee has the discretion to grant awards under the

2022 LTIP and, therefore, it is not possible as of the date of this proxy statement to determine future awards that will be received by participants under the 2022 LTIP. Information regarding awards granted in 2021 under the 2016 LTIP to the named executive officers is provided in the “2021 Summary Compensation Table” and the “2021 Grants of Plan-Based Awards” table. Information regarding awards granted in 2021 under the 2016 LTIP to non-employee directors is provided in the “2021 Director Compensation” table.

U.S. Federal Income Tax Consequences

The following is a brief summary of certain United States federal income tax consequences generally arising with respect to awards under the 2022 LTIP. This discussion does not address all aspects of the United States federal income tax consequences of participating in the 2022 LTIP that may be relevant to participants in light of their personal investment or tax circumstances and does not discuss any state, local or non-United States tax consequences of participating in the 2022 LTIP. Each participant is advised to consult his or her particular tax advisor concerning the application of the United States federal income tax laws to such participant’s particular situation, as well as the applicability and effect of any state, local or non-United States tax laws before taking any actions with respect to any awards.

Section 162(m) of the Internal Revenue Code

Section 162(m) of the Internal Revenue Code generally limits to $1 million the amount that a publicly held corporation is allowed each year to deduct for the compensation paid to each of the corporation’s chief executive officer, the corporation’s chief financial officer and certain other current and former executive officers of the corporation.

Stock Options

A participant will not recognize taxable income at the time an option is granted and the Company will not be entitled to a tax deduction at that time. A participant will recognize compensation taxable as ordinary income (and subject to income tax withholding in respect of an employee) upon exercise of a non-qualified stock option equal to the excess of the fair market value of the shares purchased over their exercise price, and the Company will

be entitled to a corresponding deduction, subject to the deduction limits under Section 162(m) of the Internal Revenue Code. A participant will not recognize income (except for purposes of the alternative minimum tax) upon exercise of an incentive stock option. If the shares acquired by exercise of an incentive stock option are held for the longer of two years from the date the option was granted and one year from the date it was exercised, any gain or loss arising from a subsequent disposition of those shares will be taxed as long-term capital gain or loss, and the Company will not be entitled to any deduction. If, however, those shares are disposed of within the above-described period, then in the year of that disposition the participant will recognize compensation taxable as ordinary income equal to the excess of (1) the lesser of the amount realized upon that disposition and the fair market value of those shares on the date of exercise over (2) the exercise price, and the Company will be entitled to a corresponding deduction, subject to the deduction limits under Section 162(m) of the Internal Revenue Code.

SARs

A participant will not recognize taxable income at the time SARs are granted and the Company will not be entitled to a tax deduction at that time. Upon exercise, the participant will recognize compensation taxable as ordinary income (and subject to income tax withholding in respect of an employee) in an amount equal to the fair market value of any shares delivered and the amount of cash paid by the Company, and the Company will be entitled to a corresponding deduction, subject to the deduction limits under Section 162(m) of the Internal Revenue Code.

Full Value Awards

The U.S. federal income tax consequences of a Full Value Award will depend on the type of award. The tax treatment of the grant of shares of Company common stock depends on whether the shares are subject to a substantial risk of forfeiture (as determined under the Internal Revenue Code) at the time of the grant. If the shares are subject to a substantial risk of forfeiture, the participant will not recognize taxable income at the time of the grant (and the

Company will not be entitled to a tax deduction) and when the restrictions on the shares lapse (that is, when the shares are no longer subject to a substantial risk of forfeiture), the participant will recognize ordinary taxable income in an amount equal to the fair market value of the shares at that time less the price paid, if any, for such shares. If the shares are not subject to a substantial risk of forfeiture or if the participant elects to be taxed at the time of the grant of such shares under Section 83(b) of the Internal Revenue Code, the participant will recognize taxable income at the time of the grant of the shares in an amount equal to the fair market value of such shares at that time, determined without regard to any of the restrictions, less the price paid, if any, for such shares.

If the shares are forfeited before the restrictions lapse, the participant will not be entitled to any deduction on account of such forfeiture. The participant’s tax basis in the shares is the amount recognized by him or her as income attributable to such shares plus the amount, if any, that the participant paid for such shares.

In the case of RSUs or PSUs, the participant generally will not have taxable income upon the grant of the award. Participants will generally recognize ordinary income when the award is settled. At that time, the participant will recognize taxable income equal to the cash or the then fair market value of the shares issuable in settlement of such award, and such amount will be the tax basis for any shares received.

Cash Incentive Awards

A participant generally will not recognize income at the time a Cash Incentive Award is granted. When a Cash Incentive Award vests and is paid, the participant will recognize ordinary income in an amount equal to the cash paid. The Company will generally be entitled to a deduction at the same time and in the same amount as the participant recognizes ordinary income.

The Board of Directors recommends that stockholders vote FOR the approval of the Yum China Holdings, Inc. 2022 Long Term Incentive Plan.

The following table sets forth the number of shares of Company common stock beneficially owned as of August 24, 2022, except as otherwise noted, by (i) beneficial owners of more than 5% of the outstanding shares of Company common stock, (ii) each of the Company’s named executive officers, (iii) each of the Company’s directors and (iv) all of the Company’s directors and executive officers as a group.

In accordance with SEC rules, beneficial ownership includes all shares the stockholder actually owns beneficially or of record, all shares over which the stockholder has or shares voting or dispositive control and all shares the stockholder has the right to acquire within 60 days of August 24, 2022. Except as indicated in the footnotes to the table, the Company believes that the persons named in the table have sole voting and investment power with respect to all shares owned beneficially by them.

This Compensation Discussion and Analysis (our “CD&A”) provides an overview of our executive compensation programs for 2021, the context under which our executive compensation decisions were determined, and how we performed within that environment.

Our named executive officers (“NEOs”) consist of our Chief Executive Officer, our Chief Financial Officer, our

three other most highly compensated executive officers who were serving as executive officers at the end of 2021, and our former Chief Supply Chain Officer. References to “continuing NEOs” in this CD&A refer to the NEOs other than our former Chief Supply Chain Officer.

Context for Determining Executive Compensation Decisions

A unique feature of the Company is that while it is incorporated in Delaware and listed on the NYSE and Hong Kong Stock Exchange, substantially all of its operations are located in China, with 11,788 restaurants in over 1,600 cities across China at the end of 2021. Our operating environment and regulatory requirements are complex and our leadership must be capable of adapting our businesses, and supporting our growth goals, amid these complexities. As a result, the operating environment and competitive market in China are significant factors in the Compensation Committee’s decision-making process and the design of our compensation program. In making compensation decisions, the Compensation Committee considers our performance in the context of the Chinese operating environment, the restaurant industry in China and our China-based peers, as well as our performance against our U.S. peers. Importantly, because our operating environment and the restaurant industry in China may be uniquely, or more significantly, impacted by certain factors than on our U.S. peers, the Compensation Committee seeks to maintain flexibility to design and refine the Company’s executive compensation program to be responsive to our operating environment even if that results in a compensation program that differs from our U.S. peers.

In addition, as a Delaware-incorporated company listed on both the NYSE and Hong Kong Stock Exchange, our leadership team must also possess, in addition to deep

knowledge of the U.S. and Hong Kong governance requirements, the global perspectives and expertise required to resolve many novel and complex issues amid the evolving global regulatory landscape, including geo-political challenges. Because the Company is designing an executive compensation program that attracts, retains and incentivizes global talent but with specific knowledge of the evolving Chinese regulatory and operating environment, including the challenges and complexities of managing the extensive supply chain and store operations, the Company’s executive compensation program may differ from our U.S. peers to reflect the competitive market in China, the need to attract a global skillset with deep knowledge of both U.S. and Chinese regulatory regimes and the Company’s desire to incentivize an entrepreneurial mindset to encourage actions that support our long-term growth and strategy. For these reasons, the Compensation Committee looked at the totality of factors the Company faces when it considers and determines executive compensation.

2021 Business Overview and Performance Highlights

As noted above, the COVID-19 pandemic continued to significantly impact the Company’s operations in 2021.

Our management team undertook immediate and strategic actions to drive sales and protect profits. These actions included:

With the tremendous effort from all of the employees led by the management team and despite the continued negative impact on our business as a result of the COVID-19 pandemic, the Company delivered substantial profits in 2021. Our 2021 performance highlights include the following:

See the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 for a reconciliation of the most directly comparable GAAP financial measures to the non-GAAP adjusted financial measures.

Company Total Shareholder Return Performance

The Board and the Compensation Committee believe that the leadership provided by the Company’s management

team was key to the Company’s strong performance in delivering multi-year shareholder returns. The graph below shows our TSR as the cumulative return to stockholders over the past five years. As illustrated, a $100 investment in our common stock on December 31, 2016 would have grown to $198 on December 31, 2021, with dividends reinvested. The Company’s shareholder return significantly outperformed that of the China market as measured by the MSCI China Index, which covers approximately 85% of the China equity market, and approximately 28% of its constituent companies are in the China Consumer Discretionary sector.

Although the key features of our executive compensation program are substantially unchanged, the Compensation Committee implemented several enhancements and changes to our executive compensation program, as set forth below. In approving these changes, the Compensation Committee considered our strategic priorities, stockholder feedback, market practices in both the U.S. and China, input from the Compensation Committee’s compensation consultant, and the operating environment in China, as described further above.

The Executive Severance Plan aids in recruitment and retention and promotes smooth succession planning, while providing transitional pay for a limited period of time to executives whose employment is involuntarily terminated. Payments are conditioned upon the executive’s execution of a release of claims in favor of the Company and compliance with restrictive covenants. Severance benefits payable under the Executive Severance Plan are equal to two times the sum of annual base salary plus annual target bonus for the CEO and one time the sum of annual base salary plus target annual bonus for the other NEOs, will be in lieu of any cash severance benefits under any other arrangement with the participant and are subject to recoupment in the event the executive violates his or her restrictive covenants with the Company.

Alignment of Executive Compensation Program with Business Performance

Our pay-for-performance incentive compensation programs are designed to align the long-term interests of our executives with those of our stockholders and to attract and retain top talent in a competitive market. The Company’s executive compensation program is structured to support the long-term sustainable growth of the Company and create value for stockholders by aligning our executives with business performance goals and motivating entrepreneurial and innovative thinking. As such, the Compensation Committee reviews and endorses performance goals that are deemed central to the Company’s

business performance, long-term strategy and stockholder value-creation. Specifically, the Compensation Committee has selected performance goals under the Company’s 2021 incentive programs that are based on metrics such as operating profit, same store sales, delivery sales, new builds, member sales, rTSR, adjusted total revenue growth, adjusted diluted earnings per share growth, and other key performance indicators described in greater detail below. These performance goals comprise an overall executive compensation program that the Compensation Committee believes appropriately reflects the Company’s emphasis on increasing profitability and revenue, enhancing customer experience, supporting an entrepreneurial mindset, creating stockholder value, while at the same time supporting key ESG initiatives.

While the Compensation Committee’s practice has generally been to establish and communicate goals at the beginning of each year, the Compensation Committee also retains flexibility to modify the Company’s executive compensation program when circumstances warrant, in order to continue to incentivize actions to drive operational performance and long-term strategies. For 2021, in light of the changes in operating environment and the significant impact of the Delta-variant outbreaks on the Company’s operating and financial performance since July 2021, the Compensation Committee adjusted the 2021 annual incentive program to measure performance with respect to the Adjusted Operating Profit Growth and Same Store Sales Growth, using the same performance goals as established at the beginning of the year, over three separate performance periods covering the first half of 2021, the third quarter of 2021 and the fourth quarter of 2021. The Compensation Committee believes that maintaining this flexibility allows the Company to appropriately reward performance in areas deemed critical to the Company’s long-term strategy.

The following chart provides an overview of the 2021 target total direct compensation program applicable to our CEO, consisting of base salary, annual performance-based cash incentives (i.e., short-term incentives, or “STI”), and long-term equity incentives (“LTI”). As demonstrated by the following chart, 2021 compensation for our CEO was heavily weighted toward variable pay elements, and such elements represented approximately 87% of the 2021 annual target compensation for Ms. Wat

(consisting of the target payout opportunity under the cash bonus plan, target annual PSUs and SARs). For purposes of this calculation, we have excluded the 2021 Chairman

Grants described below, as such grants do not represent a component of the Company’s annual executive compensation program.

The Company’s executive compensation program has three primary pay components: (i) base salary; (ii) annual performance-based cash bonuses (i.e., short-term incentives);

and (iii) long-term equity awards. We believe that these key elements are aligned with the Company’s compensation philosophy and objectives, as illustrated in the following table.

The Compensation Committee reviews on an ongoing basis the Company’s executive compensation program to evaluate whether it supports the Company’s executive compensation philosophies and objectives and is aligned

with stockholder interests. Our executive compensation practices include the following, each of which the Compensation Committee believes reinforces our executive compensation philosophy and objectives:

In its compensation review process, the Compensation Committee focuses on structuring the executive compensation program to serve the interests of our stockholders. In that respect, as part of its ongoing review of our executive compensation program, the Compensation Committee considered the approval by approximately 93% of the

votes cast for the Company’s “say on pay” vote at our 2021 Annual Meeting of Stockholders. Although the Compensation Committee was pleased with this favorable outcome and interpreted this level of support as an endorsement by our stockholders of our executive compensation program and policies, the Compensation

Committee continuously evaluates program design and considers adjustments to the Company’s compensation program based on stockholder feedback, market practices, operating environment and other considerations in order to deliver a program designed to be aligned with our business strategy, the creation of long-term value and our stockholders’ interests.

During 2021, the Company reached out to its 25 largest stockholders and select stockholders who previously indicated interest for having engagement calls (which represented more than 50% of the Company’s outstanding shares) to solicit feedback on a variety of corporate governance matters (including with respect to executive

compensation), and the Company held discussions with all stockholders who accepted an invitation. Management shared this stockholder feedback with the Compensation Committee for its consideration in designing the Company’s executive compensation program.

Based on feedback received during the Company’s stockholder engagement efforts over the past several years, the Compensation Committee has approved changes to its compensation program, including the incorporation of ESG measures and targets into the key performance indicators that are used to determine the individual performance factor under the 2021 annual incentive program for each leadership team member.

The Company’s 2021 executive compensation program consists of three primary pay components: (i) base salary; (ii) annual performance-based cash bonuses (i.e., short-term incentives); and (iii) long-term equity awards. The following charts demonstrate that 2021 annual target compensation for Ms. Wat, our CEO, and the continuing NEOs was heavily weighted toward variable pay elements. Such elements represented approximately 87% of

the 2021 annual target compensation for Ms. Wat and, on average, 72% of the 2021 annual target compensation for our other NEOs (consisting of the target payout opportunity under the cash bonus plan and target annual equity grants and excluding the 2021 Chairman Grants and all other compensation reported in the 2021 Summary Compensation Table).

Base Salary

The Company provides a fixed level of cash compensation to attract and retain high-caliber talent. Base salary in the form of cash compensates executives for their primary roles and responsibilities. An executive’s actual salary is dependent on factors such as the executive’s role (including the market value of the role), level of responsibility, experience, individual performance and future potential. The Compensation Committee annually reviews salary levels of the Company’s executive officers

to maintain market competitiveness and reflect their evolving responsibilities.

Annual Performance-Based Cash Bonuses

The principal purpose of our cash-based annual incentive program is to motivate and reward short-term team and individual performance. The following is the formula used to calculate 2021 annual performance-based cash bonuses:

The Compensation Committee reviewed the performance measures used in the annual incentive plan to assess the program’s alignment of the incentive payouts with key performance measures of the Company’s overall business and operating segments. The Compensation Committee established the initial team performance measures, targets and weights for the 2021 bonus program at the beginning of the year after receiving input and recommendations from management and the Compensation Committee’s compensation consultant. The team performance objectives and targets in 2021 were developed through the Company’s annual financial planning process, which took into account growth strategies, historical performance, and the existing and expected future operating environment of the Company.

At the time the targets were set, the performance targets were designed to be challenging but achievable given the

operating environment at the time and with strong management performance. A leverage formula for each team performance measure magnifies the potential impact that performance above or below the performance target will have on the calculation of the annual bonus. This leverage increases the payouts when targets are exceeded and reduces payouts when performance is below target, with a threshold level of performance required in order for any bonus associated with such metric to be paid and a cap on bonus payments.

The team performance targets and weights for each measure established at the beginning of 2021 for the Company’s NEOs are outlined below. The Company’s performance metrics were established as growth rate goals with 2020 as the base line measure. This methodology required performance better than in 2020 in order to receive a target payout.

The incentive targets for the Team Performance Factor were set based on the operating environment at the beginning of 2021 when the COVID-19 situation was relatively stable. However, multiple waves of Delta-variant outbreaks persisted, and our business was significantly affected, in the second half of the year. For details, see “Executive Summary—Context for Determining Executive Compensation Decisions—Operating Environment.”

In light of the changes in operating environment and the significant impact of the Delta-variant outbreaks on the Company’s operating and financial performance since July 2021, in September 2021, the Compensation Committee determined to measure performance with respect to the Adjusted Operating Profit Growth and Same Store

Sales Growth team performance measures over three separate performance periods: the first half of 2021 (weighted 50%); the third quarter of 2021 (weighted 25%); and the fourth quarter of 2021 (weighted 25%). The performance targets for each of these three distinct performance periods were derived from the performance goals established in early 2021, with the only difference being the segregation of performance into the three distinct performance periods. This change retained the same performance-based program design and kept the original goals, but helped address the volatility associated with the COVID-19 pandemic. The team performance targets, actual results, weights and overall performance for each measure following the adjustments described above are outlined below.

As noted above, a team factor of 112% was achieved based on the five performance measures set out above with the performance periods for the performance measures of Adjusted Operating Profit Growth and Same Store Sales Growth being segregated into three distinct performance periods. With Adjusted Operating Profit Growth and Same Store Sales Growth measured on a full-year basis as established in early 2021, the team factor would have been 65% due to the volatility of COVID-19

on the Company’s performance during 2021. Although the strong performance, particularly in the first half of 2021, and the extraordinary effort of the management team in containing cost and delivering positive profit amid the severe impact of COVID-19 in the second half of 2021, would have resulted in a team factor of 112%, the Compensation Committee applied discretion to reduce the result from 112% and approved a final team factor of 105% for Company performance.

Individual Performance Factors

In February 2021, the Compensation Committee approved the performance goals that would be used to determine the Individual Performance Factor for the CEO and provided input on the performance goals recommended by the CEO for the other NEOs, which would subsequently be used by the CEO to recommend to the Compensation Committee the Individual Performance Factor for each NEO. As part of the Company’s annual performance evaluation process, the CEO, after having received input from the Compensation Committee and after consultation with each NEO, establishes that NEO’s performance objectives for the coming year, which are ultimately approved by the Compensation Committee. These performance objectives are not intended to be rigid or formulaic, but rather to serve as the framework upon which the CEO evaluates the NEO’s overall performance.

These annual performance goals generally fell within the performance categories of mitigating the impact of the COVID-19 pandemic, increasing stockholder returns, accelerating the growth of our brands, driving new business initiatives, and ESG objectives. Under each performance goal category, each NEO has a number of underlying pre-established goals against which the NEO’s performance is assessed to determine whether the NEO has achieved the overall performance goal. The evaluation of an executive’s performance relative to these goals is inherently subjective, involving a high degree of judgment based on the CEO’s observations of, and interactions with, the executive throughout the year. As an additional input to the evaluation of an executive’s performance, the CEO assesses the overall performance of the Company in light of the dynamics of the China market. As a result, no single performance goal or group of goals is determinative for the CEO’s evaluation of the executive’s performance.

The above evaluation provides the basis for the CEO’s recommendation to the Compensation Committee for the executive’s Individual Performance Factor. The Compensation Committee then meets with the CEO and discusses the CEO’s recommendations and meets separately in executive session to discuss the CEO’s recommendations and make a determination of the Individual Performance Factor for the NEOs, excluding the CEO.

The Compensation Committee applies similar factors in determining the Individual Performance Factor for the CEO. The Compensation Committee meets in executive session to discuss the CEO’s individual performance and then consults with the Chairman of the Board for their collective determination of the CEO’s Individual Performance Factor. The evaluation of the CEO’s overall performance relative to these factors is also inherently subjective, involving a high degree of judgment. The Compensation Committee and the other independent directors assess the overall performance of the Company in light of the dynamics of the China market in which the Company operates. As a result, no single performance goal or group of goals is determinative for the evaluation of the CEO’s performance.

The use of Individual Performance Factors provides the Company with a degree of flexibility (applied reasonably and in moderation by the Compensation Committee) to reward contributions to strategic business initiatives and the building of organizational capabilities supportive of the creation of long-term value.

Based on the foregoing, the Compensation Committee assigned 2021 Individual Performance Factors for the NEOs ranging from 100% to 130%, as described below under “2021 NEO Compensation and Performance Summary.”

Long-Term Equity Incentives

The Company provides long-term equity compensation to its executives to encourage decision-making that creates long-term sustainable stockholder value. In determining the size of the annual equity awards, the Compensation Committee considers the following:

Consistent with the 2020 annual equity grants, the 2021 annual equity grants consisted of SARs and PSUs, equally weighted. The entire portion of the annual equity grant is considered by the Compensation Committee to be performance-based as the PSUs will vest based only on the Company’s achievement of performance goals relating to rTSR, Adjusted Total Revenue Growth and Adjusted Diluted Earnings Per Common Share Growth, and the SARs will realize value only to the extent the Company’s stock price increases from the date of grant.

The SARs vest annually in equal installments of 25%, beginning on the first anniversary of the grant date and generally subject to continued employment through the applicable vesting date. The exercise price of each SAR grant is based on the closing market price of the underlying Company stock on the date of grant.

The Annual PSU Awards are designed to incentivize each NEO’s performance over the performance period from January 1, 2021 to December 31, 2023 and to further align their interests with the interests of our stockholders. In early 2021, in response to the challenges presented by the COVID-19 pandemic with respect to setting targets for the Annual PSU Awards, the Compensation Committee determined to grant the Annual PSU Awards in two equally weighted grants, with the first grant occurring in February 2021 and to vest based on the Company’s achievement of rTSR performance goals and the second grant occurring three months later in May 2021 and to vest based on the Company’s achievement of performance goals relating to Adjusted Total Revenue Growth (weighted 50%) and Adjusted Diluted Earnings Per Common Share Growth (weighted 50%). Given the uncertainty presented by the continuing COVID-19 pandemic, the Compensation Committee considered a number of options to design the Annual PSU Awards in a manner that served as an appropriate incentive vehicle while also aligning the long-term interests of recipients with our stockholders, including the possibility of setting annual performance goals for each year in the three-year performance period with respect to the Adjusted Total Revenue Growth and Adjusted Diluted Earnings Per Common Share Growth performance goals. In order to align the Annual PSU Awards with the long-term interest of the stockholders, the Compensation Committee ultimately decided to approve a three-year performance period from January 1, 2021 to

December 31, 2023, as compared to three annual performance periods. To obtain greater clarity on the operating environment and assess the rigor of these three-year performance goals, the Compensation Committee delayed the grant date by three months until May 2021 for the Annual PSU Awards with vesting tied to these two performance goals. Consistent with the Company’s usual practice of granting annual LTI awards in February, the number of shares subject to the May 2021 portion of the PSU grant was determined based on the February 2021 stock price rather than the stock price on the grant date in May 2021. This resulted in larger grant date fair value as compared to the grant level approved in February 2021 due to higher stock price in May 2021.

The rTSR performance goal for the 3-year performance period from January 1, 2021 to December 31, 2023 is measured as achievement compared against constituents of the MSCI China Index. The vesting is capped at target if TSR performance is negative over the performance period. For Company performance at the 30th percentile, threshold shares (50% of target) would be earned, at the above median 55th percentile 100% of target shares would be earned, and at the 80th percentile or greater, maximum shares (200% of target) would be earned. The Adjusted Total Revenue Growth and Adjusted Diluted Earnings Per Share Growth goals use the 2020 results as a baseline from which to measure growth. Given the Company’s performance in 2020 (and the first quarter of 2021 with respect to the Adjusted Total Revenue Growth and Adjusted Diluted Earnings Per Share Growth performance goals) and the Company’s operating plan over the three-year performance period, the performance goals applicable to the Annual PSU Awards were designed to be challenging but achievable with strong management performance.

2021 represented the final year of the 2019-2021 performance period for PSUs granted in 2019. Under the 2019 PSU program, Ms. Wat’s 2019 PSUs would be settled in shares of our common stock based on our rTSR performance over the 2019-2021 performance period relative to 143 of the 149 companies in the MSCI International China Index as of January 1, 2019 and that were still active as of December 31, 2021. Under the program, payout would be capped at target if the Company’s TSR was negative over the three-year performance period.

Based on the Company’s 45.71% TSR performance during the three-year performance period, the Company ranked at the 72nd percentile as compared to the TSR performance of the active constituents of the MSCI International China Index at the end of the performance period, resulting in 157.43% of the target PSUs and dividend equivalents vesting, or 67,686 shares of our common stock.

2021 Chairman Grants

In February 2021, the Compensation Committee awarded the 2021 Chairman Grants to select Company executive officers and employees. Among the NEOs, Ms. Wat and Messrs. Yeung and Chan were selected as recipients of the Chairman long-term equity grant. These awards are intended to provide recognition for exemplary individual leadership demonstrated by select executives and employees during 2020, in particular in resolving many novel and complex regulatory issues to execute the Company’s secondary listing on the Hong Kong Stock Exchange and navigating the Company through the COVID-19 crisis. The Company considers it important to retain the flexibility to make long-term equity awards to specifically reward demonstrated individual leadership actions and behaviors that are not factored into the corporate performance goals underlying the equity awards made to our entire management team, but which still recognize individual actions and behaviors that the Company wants to encourage and foster. While these awards were granted in recognition of the significant individual achievements and leadership displayed by recipients during 2020, the Compensation Committee elected to deliver the 2021 Chairman Grants as RSUs that cliff-vest on the third anniversary of the grant date to incentivize retention over this three-year period. Factors considered in awarding the Chairman Awards included:

The grants to Ms. Wat and Messrs. Yeung and Chan have a grant date fair value of $2,500,000, $1,600,000 and $1,500,000, respectively, and will cliff-vest on the three-year anniversary of the grant date based on continued service through the vesting date. The Compensation Committee elected to deliver the 2021 Chairman Grants as RSUs rather than as cash bonuses in order to further incentivize the retention of these key contributors over the applicable vesting period and to further align their interests with the interests of our stockholders. While these awards are not a component of the Company’s annual executive compensation program, the Compensation Committee determined that the 2021 Chairman Grants were appropriate to recognize the listing on the Hong Kong Stock Exchange and to incentivize similar actions that required significant efforts and innovativeness by our select executives.

2022 Lavazza ESOP Grants

As previously disclosed, the Company and Lavazza Group established the Lavazza Joint Venture to explore and develop the Lavazza coffee business in China. In order to incentivize the efforts of employees of the Company, Lavazza Group and the Lavazza Joint Venture to execute on the Lavazza Joint Venture’s business plan, including the target to open 1,000 Lavazza stores in China by 2025, the Lavazza Joint Venture established the JV

Equity Plans allowing for the grant of equity awards with respect to the Lavazza Joint Venture to key employees of the Lavazza Joint Venture, as well as select employees of Lavazza Group and the Company. Under the JV Equity Plans, up to 15% of the equity in the Lavazza Joint Venture may be granted as equity awards under the JV Equity Plans, with employees and other eligible participants of the Lavazza Joint Venture, including general restaurant managers, eligible to receive up to 80% of the JV Equity Plan shares, or 12% of the equity in the Lavazza Joint Venture. The remaining JV Equity Plan shares will be allocated to the employees of the Company and Lavazza Group in accordance with their respective equity interest in the Lavazza Joint Venture, or up to 2% and 1%, respectively, of the equity in the Lavazza Joint Venture. The Compensation Committee has discretion to award the portion of the JV equity pool allocated to the Company to employees of the Company who have been key contributors to the efforts of the Lavazza Joint Venture and are deemed to be essential to the successful execution of the Lavazza Joint Venture’s business plan. The JV Equity Plans and related grants were adopted in order to support entrepreneurial and innovative thinking and leadership through a compensation structure linked to brand expansion and our long-term strategy.

After considering the input of the Compensation Committee’s compensation consultant with respect to form and amount of equity awards to be granted to Company employees, on February 10, 2022, the Lavazza Joint Venture and the Compensation Committee approved equity awards under the applicable JV Equity Plan to certain employees of the Company, including the continuing NEOs, in the form of PSUs. The PSUs are subject to both performance-based vesting conditions and the occurrence of a liquidity event. The performance-based vesting conditions relate to the Lavazza Joint Venture’s performance with respect to revenue, store-level profitability, brand-level profitability and store count, each equally weighted, with performance to be measured on a rolling four-consecutive quarter basis over a four-year performance period. The liquidity event vesting condition, which includes the occurrence of an initial public offering of the Lavazza Joint Venture, must occur within seven years of the grant date. Any portion of the award that does not vest, either based on the achievement of the applicable performance-based vesting conditions or the non-occurrence of

the liquidity event, will be forfeited in their entirety. To recognize the efforts of each of the continuing NEOs with respect to the Lavazza Joint Venture and to incentivize and galvanize their continued focus on the success of the Lavazza Joint Venture, the Compensation Committee granted PSUs with the following grant date fair values to each of the continuing NEOs: Ms. Wat, $1,000,000; Mr. Yeung, $200,000; Mr. Chan, $200,000; Mr. Huang, $200,000 and Mr. Yuen, $200,000.

Other Elements of Executive Compensation Program

As with all Company employees, Company executive officers receive certain employment benefits. We believe the benefits we offer are an important part of retention and capital preservation for all levels of employees. Our benefits are designed to protect against unexpected catastrophic losses of health and earnings potential and provide a means to save and accumulate assets for retirement.

Post-Termination and Change in Control Compensation.

The Company provides certain post-termination and change in control compensation to help accomplish the Company’s compensation philosophy of attracting and retaining executive talent.

Change in Control Severance Plan. The Company maintains a change in control severance plan that covers all NEOs. Severance benefits are payable only upon a qualifying termination, which is defined as a termination by the Company without cause or by the participant due to good reason, within 24 months following the consummation of a change in control of the Company. The Compensation Committee believes change in control compensation promotes management independence and helps retain, stabilize, and focus the executive officers in the event of a change in control.

Executive Severance Plan. As noted above, in September 2021, the Compensation Committee adopted the Executive Severance Plan to provide severance benefits to certain key management employees of the Company and its affiliates who are selected by the Compensation Committee to participate in the plan, including each of the NEOs.

The Executive Severance Plan aids in recruitment and retention and promotes smooth succession planning, while providing transitional pay for a limited period of time to executives whose employment is involuntarily terminated. Payments are conditioned upon the executive’s execution of a release of claims in favor of the Company and compliance with restrictive covenants. Severance benefits payable under the Executive Severance Plan are equal to two times the sum of annual base salary plus annual target bonus for the CEO and one time the sum of annual base salary plus target annual bonus for the other NEOs, will be in lieu of any cash severance benefits under any other arrangement with the participant and are subject to recoupment in the event the executive violates his or her restrictive covenants with the Company.

The terms of the Change in Control Severance Plan and Executive Severance Plan were determined after considering market data and the input of the compensation consultant. The award agreements with respect to the Company’s outstanding equity awards also provide for pro-rata vesting in the event of certain qualifying terminations of employment, as described below.

Please see the “Potential Payments upon a Termination or a Change in Control” section below for a quantification of the amounts that would be payable to each of the continuing NEOs in connection with a termination of employment or change in control as of December 31, 2021.

Retirement Plans. The Company offers certain executives working in China retirement benefits under the Bai Sheng Restaurants China Holdings Limited Retirement Scheme (“BSRCHLRS”). Under the BSRCHLRS, executives may make personal contributions, and the Company provides a company-funded contribution ranging from 5% to 10% of a participating executive’s base salary. During 2021, all of our NEOs were participants in the BSRCHLRS, and each NEO received a company-funded contribution.

Medical, Dental, and Life Insurance and Disability Coverage. The Company provides benefits such as medical, dental, and life insurance and disability coverage to its executive officers through the same benefit plans that are provided to all eligible China-based employees.

Perquisites. Certain perquisites are provided to certain Company executive officers relating to overseas assignments. These perquisites are governed by the Company’s formal mobility policy, are offered on a case-by-case basis and reflect each executive’s particular circumstances while also generally reflecting market practices for similarly situated, globally mobile executives working in international companies based in mainland China. For example, the Company may offer perquisites such as housing cost subsidies, dependent education, and home leave payments to executives performing services in China. These perquisites are considered to be a necessary component of the Company’s executive compensation program in order to attract and retain high-performing executives from different countries who have the skill sets and experience to successfully manage and lead the Company in mainland China.

Prior to our spin-off from YUM, certain of our NEOs were offered tax equalization benefits as an element of their compensation. These tax equalization benefits represent legacy compensation arrangements entered into with our former parent. After the spin-off, the Compensation Committee began to phase out tax equalization benefits for the NEOs (other than certain grandfathered benefits pursuant to the legacy arrangements).

See the 2021 All Other Compensation Table in this CD&A for details regarding the perquisites received by our NEOs during 2021.

Below is a summary of our NEOs’ 2021 compensation—which includes base salary, annual cash bonus, and equity

awards—and an overview of our NEOs’ 2021 performance relative to the annual performance goals.

2021 Performance Summary. The Compensation Committee determined Ms. Wat’s performance to be above target with an Individual Performance Factor of 130%. At the beginning of the year, the Compensation Committee set individual performance goals for Ms. Wat covering five pre-defined performance areas: (1) financial performance as measured by sales and profit growth; (2) ESG; (3) accelerating growth of leading brands; (4) growing new business initiatives and (5) building people, culture and organization.

Further, Ms. Wat was recognized for leading the Company’s crisis management team in tackling many challenges arising out of the COVID-19 pandemic in 2021 and continuing to execute the Company’s business plan through a disciplined review process. While the COVID-19 pandemic heavily impacted the Company’s business in the second half of 2021, Ms. Wat led the Company in delivering system sales growth of 10% and achieving delivery sales growth of 20% for KFC and 14% for Pizza Hut. Under Ms. Wat’s leadership, Pizza Hut’s revitalization program, which started in 2017, has significantly improved fundamentals, and Pizza Hut achieved remarkable growth in both sales and profit in 2021. The Company achieved record openings of 1,806 gross new stores with diversified store models and healthy unit economics. Since Ms. Wat’s appointment as CEO in early 2018, the Company’s TSR consistently outperformed that of the MSCI China Index. The Compensation Committee also attached importance to Ms. Wat’s management of the Company’s talent base. Under her direction, the Company initiated the building of a digital research and development center in three cities to support the multi-year end-to-end digitalization initiative. Ms. Wat also took an active role in guiding the Company’s ESG efforts. The Company’s 2021 ESG achievements included phasing-out disposable plastic cutlery, as well as gradually replacing non-degradable plastic bags with paper or biodegradable plastic bags. Ms. Wat also assembled a

project team supported by external advisors to develop a long-term greenhouse gas emissions strategy leading to the Company’s announcement of its commitment to setting the Science Based Targets.

2021 Compensation Decisions. Effective February 1, 2021, the Compensation Committee decided to bring Ms. Wat’s 2021 target compensation levels closer in line with the median of the Company’s compensation peer group, after taking into account Ms. Wat’s experience in and knowledge of the China consumer market and global expertise. These decisions positioned Ms. Wat’s total target direct compensation at the 42nd percentile of the Company’s 2021 compensation peer group. After considering the advice of its compensation consultant, market practices, and Ms. Wat’s individual performance, the Compensation Committee made the following compensation decisions.

2021 Performance Summary. The Compensation Committee determined Mr. Yeung’s performance to be above target with an Individual Performance Factor of 125%. Mr. Yeung was recognized for driving disciplined financial planning and vigorous cost management measures, achieving a year-over-year increase in Operating Profit despite the significant impact due to the resurgence of COVID-19 in the second half of 2021. He also led the development of the Company’s multi-year capital allocation strategy. With the Company becoming newly listed on the Hong Kong Stock Exchange in September 2020, he led the efforts for the Company’s compliance with the rules of the SEC and Hong Kong Stock Exchange. Mr. Yeung played an active role in ESG, including the Company’s strategy and roadmap relating to setting Science Based Targets. For new growth initiatives, Mr. Yeung was instrumental in formulating the long-term joint venture agreement with Lavazza Group. He also devised and implemented robust monthly financial reviews on all new growth initiatives, including the Lavazza Joint Venture, to complement the leadership team’s comprehensive business reviews on these growth initiatives and support disciplined, accelerated growth.

2021 Compensation Decisions. Effective February 1, 2021, the Compensation Committee set Mr. Yeung’s 2021 compensation levels after considering the advice of its compensation consultant, market practices and Mr. Yeung’s individual performance. Specifically, the compensation adjustments for Mr. Yeung were made to bring the components of his annual target total direct compensation closer in line with that of the median of the compensation peer group.

2021 Performance Summary. The Compensation Committee determined Mr. Chan’s performance to be above target with an Individual Performance Factor of 125%. Mr. Chan also contributed significantly to the building and updating of the Company’s compliance and governance framework especially following its secondary listing on the Hong Kong Stock Exchange in September 2020. Mr. Chan also played an instrumental role in supporting the execution of strategic investments including transaction structuring, due diligence, definitive agreement drafting and negotiation and regulatory approvals. Mr. Chan also further enhanced the Company’s capability to manage and mitigate emerging risks such as cybersecurity and intellectual property protection. Mr. Chan was recognized for serving as a core member of the Company’s Sustainability Committee to lead and guide the Company’s sustainability disclosures to follow evolving regulatory requirements and market practices. He made significant contributions in the ESG strategy and roadmap formulation, including the Company’s commitment to setting Science Based Targets.

2021 Compensation Decisions. Effective February 1, 2021, the Compensation Committee set Mr. Chan’s 2021 compensation levels after considering the advice of its compensation consultant, market practices and Mr. Chan’s individual performance.

2021 Performance Summary. During 2021, Mr. Huang served as General Manager, KFC, after returning from medical leave of absence during 2020. The Compensation Committee determined that Mr. Huang’s 2021 performance was on target with an Individual Performance Factor of 110%. Mr. Huang was recognized for driving KFC’s prompt actions in response to the disruptions due to the multiple waves of the COVID-19 outbreaks especially in the second half of 2021. The KFC Brand, under Mr. Huang’s leadership, delivered an 8% increase in system sales growth, and achieved delivery sales growth of 20%, openings of 1,232 gross new stores and new member acquisition of 55 million. Mr. Huang made significant

progress in implementing KFC’s strategy in both expanding regionally-inspired menu items and adopting diversified store models. He also led the efforts to improve restaurant productivity through the use of digital technologies and automation, leading to labor productivity improvement and wastage reduction. Mr. Huang supported the Company’s ESG strategy by launching the first carbon neutral product and replacing disposable plastic straws, cutlery and bags, representing savings of over 7,000 tons of plastic in 2021. He supported the continued expansion of the KFC food bank project to 27 cities at the end of 2021.

2021 Compensation Decisions. Effective February 1, 2021, the Compensation Committee set Mr. Huang’s 2021 compensation levels after considering the advice of its compensation consultant, market practices, Mr. Huang’s individual performance and the strong performance of KFC.

2021 Performance Summary. The Compensation Committee determined Mr. Yuen’s performance to be above target with an Individual Performance Factor of 125%. Mr. Yuen was recognized for his instrumental role in guiding and coordinating employees’ health and safety measures against the multiple waves of the COVID-19 outbreaks especially in the second half of 2021. In 2021, the Company upgraded the medical insurance coverage of our restaurant general managers, restaurant management teams and supervisors. To build organizational capability, he contributed significantly in building the Company’s digital research and development center and the Lavazza Joint Venture team from scratch. Mr. Yuen also served as a core member of the Company’s Sustainability Committee. He provided valuable guidance and input in enhancing the Company’s disclosures on human capital management in the Company’s Annual Report and Sustainability Report. In 2021, the Company was named to the Bloomberg Gender-Equality Index and was certified as a Top Employer 2021 in China by the Top Employers Institute, both for the third consecutive year.

2021 Compensation Decisions. Effective February 1, 2021, the Compensation Committee set Mr. Yuen’s 2021

compensation levels after considering the advice of its compensation consultant, market practices and Mr. Yuen’s individual performance.

2021 Performance Summary. The Compensation Committee determined Mr. Tan’s performance to be on target with an Individual Performance Factor of 100%. Mr. Tan was recognized for his contribution in managing and optimizing cost of sales, leading to significant savings for raw materials and logistics cost. He also provided valuable input in planning for the expansion of the Company’s logistics center network. In 2021, the Company acquired land for three logistics centers, of which the Company started greenfield construction for two. When serving as the chairperson of the Sustainability Committee, he was instrumental in formulating the Company’s ESG strategy and roadmap, including the Company’s commitment to setting Science Based Targets, and seeking alignment from key stakeholders. Under his leadership, the Company’s ESG efforts achieved progressive improvements, as demonstrated by the assessment results from third-party agencies, including DJSI, ISS and MSCI.