002042SZSE

Compensation Management System for Directors and Senior Management

Huafu Fashion Co., Ltd.·

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This document outlines the compensation system for directors and senior management of HUA FU FASHION CO., LTD. It establishes principles for determining compensation based on performance, market conditions, and company scale. The system details compensation components, performance evaluation methods, and procedures for withholding or recovering compensation in cases of financial misconduct or loss to the company.

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Directors and Senior Management Compensation Management System

Chapter 1 General Provisions

Article 1 To establish and improve the internal incentive and restraint mechanisms of the company, fully leverage and mobilize the enthusiasm and creativity of directors and senior management, and better improve the company's operating efficiency and management level, this system is formulated in accordance with the "Company Law of the People's Republic of China," "Corporate Governance Guidelines for Listed Companies," relevant laws and regulations, the "Stock Listing Rules of the Shenzhen Stock Exchange," the "Shenzhen Stock Exchange Main Board Listed Company Regulation No. 1 - Normative Operation of Listed Companies," and the "Articles of Association."

Article 2 This system applies to the company's directors and senior management. Directors include non-independent directors and independent directors. Senior management includes the president, vice presidents, financial director, and other senior management personnel appointed by the board of directors.

Article 3 The company's compensation management adheres to the following principles: (I) Compensation levels are matched with position value, responsibilities, and obligations; (II) Compensation is coordinated with the company's scale and performance, while also considering market compensation levels; (III) Incentives and restraints are combined, and compensation payments are linked to performance evaluations, rewards and punishments, and incentive mechanisms;

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