Related Party Transaction Decision-Making System

Related Party Transaction Decision-Making System

Zhejiang Bofei Electric Co., Ltd. (hereinafter referred to as "the Company") establishes this Related Party Transaction Decision-Making System to further standardize the management of related party transactions, clarify decision-making procedures and management responsibilities, and protect the legitimate interests of the Company, its shareholders, and creditors, especially the legitimate interests of minority investors. This system ensures that contracts for related party transactions are in accordance with the principles of fairness, justice, and openness, based on the "Company Law of the People's Republic of China," "Securities Law of the People's Republic of China," "Code of Corporate Governance for Listed Companies," "Shenzhen Stock Exchange Listing Rules" (hereinafter referred to as "Listing Rules"), "Self-Regulatory Guidelines No. 7 for Listed Companies on the Shenzhen Stock Exchange - Transactions and Related Party Transactions," and the "Articles of Association of Zhejiang Bofei Electric Co., Ltd." (hereinafter referred to as "Articles of Association"), as well as relevant national laws, regulations, and normative documents.

Chapter 1 Scope of Related Parties and Related Transactions

Article 1 The related parties of the Company include related legal entities (or other organizations) and related natural persons.

Article 2 A legal entity is considered a related legal entity (or other organization) if it meets any of the following conditions:

1. Directly or indirectly controls the Company;

2. Is controlled directly or indirectly by the legal entity mentioned in the previous item, excluding the Company and its controlling subsidiaries;

3. Is directly or indirectly controlled by related natural persons listed in this system or serves as a director (excluding independent directors of both parties) or senior management of a legal entity or other organization, excluding the Company and its controlling subsidiaries;

4. Holds more than 5% of the Company's shares and its concerted actors;

5. Other legal entities (or organizations) recognized by the China Securities Regulatory Commission, Shenzhen Stock Exchange (hereinafter referred to as "SZSE"), or the Company based on the principle of substance over form, which have a special relationship with the Company and may have caused or are likely to cause the Company to favor their interests.

Article 3 The related natural persons of the Company are defined as:

1. Natural persons who directly or indirectly hold more than 5% of the Company's shares;

2. Directors and senior management of the Company;

3. Directors, supervisors, and senior management of legal entities (or other organizations) that directly or indirectly control the Company;

4. Close family members of the individuals mentioned in items (1) and (2), including spouses, children over 18 years old and their spouses, parents and parents-in-law, siblings and their spouses, siblings of spouses, and parents of spouses of children;

5. Other natural persons recognized by the China Securities Regulatory Commission, SZSE, or the Company based on the principle of substance over form, which have a special relationship with the Company and may have caused or are likely to cause the Company to favor their interests.

Article 4 Within the past 12 months or based on relevant agreements arranged for the next 12 months, any legal entity (or other organization) or natural person that meets the conditions described in Articles 2 and 3 is considered a related party of the Company.

Article 5 Directors, senior management, shareholders holding more than 5%, their concerted actors, and actual controllers of the Company must promptly submit a list of related parties and explanations of related relationships to the Company's board of directors, which will manage the registration.