ZHEZHONG GROUP Stock Abbreviation: ZHEZHONG GROUP Stock Code: 002346 Shanghai Zhezong Group Co., Ltd. Independent Director 2025 Annual Report As an independent director of Shanghai Zhezong Group Co., Ltd. (hereinafter referred to as the "Company"), in accordance with the "Company Law," the "Guiding Opinions on Establishing an Independent Director System for Listed Companies," the "Several Provisions on Strengthening the Protection of the Rights and Interests of Publicly Issued Shareholders," the "Company's Independent Director Work System," and other relevant laws, regulations, and the "Articles of Association," I have diligently performed my duties, acted conscientiously, and actively fulfilled the role of an independent director in safeguarding the interests of the Company and its shareholders. The report on my performance in 2025 is as follows: I. Attendance at Board of Directors and Shareholder Meetings The Company held a total of 7 board meetings and 3 shareholder meetings in 2025. This year, I was scheduled to attend 7 board meetings and actually attended all 7. I also attended 3 shareholder meetings. I attended board meetings on time, proactively reviewed meeting materials before the meetings, carefully deliberated on the proposals, exercised my voting rights with prudence, and safeguarded the legitimate rights and interests of all shareholders. My attendance at board meetings is as follows:
| Independent Director Name | Number of Board Meetings Attended | Number of Board Meetings Attended in Person | Number of Board Meetings Attended via Communication | Number of Entrusted Attendance | Number of Absences |
|---|---|---|---|---|---|
| Wu Yinghao | 7 | 7 | 0 | 0 | |
| II. Attendance at Independent Director Special Committee Meetings | |||||
| Date | Meeting Session | Matters Reviewed | Summary | ||
| --- | --- | --- | --- | ||
| April 23, 2025 | Third Meeting of the Fifth Board of Directors Independent Director Special Committee | Proposal on Extension of Related Party Loan and Related Transaction | Kangfeng Investment, the controlling shareholder, will extend a loan to the Company for one year, with a credit line not exceeding RMB 300 million and an interest rate of 2.5%. | ||
| December 12, 2025 | First Meeting of the Sixth Board of Directors Independent Director Special Committee | Proposal on Extension of Related Party Loan and Related Transaction | Kailer Electric Appliance, a related party, will extend a loan to the Company for one year, with a credit line not exceeding RMB 300 million and an interest rate of 2.5%. | ||
| III. Attendance at Board of Directors Special Committee Meetings | |||||
| In 2025, I, as the Chairman of the Audit Committee, participated in meetings including the pre-audit communication meeting for the annual financial statements and the preliminary audit communication meeting for the annual financial statements. I also served as a member of the Remuneration and Assessment Committee. I personally attended all meetings held by the special committees, leveraging my professional expertise and rich industry experience to provide professional advice for the Company to further improve its internal control and governance structure, enhance corporate governance, and make other major strategic decisions, thereby fully fulfilling the role of the special committee. | |||||
| My attendance at board of directors special committee meetings is as follows: | |||||
| Committee Name | Member Information | Number of Meetings Held | Meeting Date | Meeting Content | Suggestions and Recommendations Made |
| --- | --- | --- | --- | --- | --- |
| Audit Committee | Wu Yinghao, Sun Yanzhong, Ma Jiajie | 5 | April 23, 2025 | Review of the "2024 Annual Report" and its summary, "Summary of 2024 Non-operating Fund Occupation and Other Related Party Transactions," "2024 Internal Control Self-Evaluation Report," "2024 Internal Audit Report," and "First Quarter 2025 Report" | The Audit Committee reviewed the reports compiled by the Company for the 2024 annual report and the first quarter of 2025, and examined the Company's internal control situation in 2024. |
| Audit Committee | Wu Yinghao, Sun Yanzhong, Ma Jiajie | 5 | August 25, 2025 | Review of the "2025 Half-Year Report" and its summary, and the "Proposal on 2025 Half-Year Non-operating Fund Occupation and Other Related Party Transactions," and the "2025 Half-Year Internal Audit Work Report" | The Audit Committee reviewed the Company's 2025 half-year report, examined the situation of non-operating fund occupation and other related party transactions in the first half of 2025, and guided the audit work for the third quarter of 2025. |
| Audit Committee | Wu Yinghao, Sun Yanzhong, Ma Jiajie | 5 | October 30, 2025 | Review of the "Third Quarter 2025 Report" | The Audit Committee reviewed the third quarter financial situation and guided the audit work for 2025. |
| Audit Committee | Wu Yinghao, Sun Yanzhong, Ma Jiajie | 5 | November 18, 2025 | Review of the "Proposal on Re-appointment of Accounting Firm" | The Audit Committee, in accordance with relevant regulations, selected the Company's annual audit firm. Based on multiple evaluation criteria such as professional capability, industry reputation, cooperation history, and fee quotation, it was decided to re-appoint Zhonghui Certified Public Accountants LLP as the Company's 2025 audit firm. |
| Audit Committee | Wu Yinghao, Sun Yanzhong, Ma Jiajie | 5 | December 12, 2025 | Review of the "Proposal on Appointing Mr. Zhang Bohua as the Company's Chief Financial Officer" | Regarding the change of Company directors and senior management, the Audit Committee reviewed the identity information, educational background, professional qualifications, and other relevant qualifications of the Chief Financial Officer candidate before the appointment of the Chief Financial Officer. |
| Remuneration and Assessment Committee | Gu Feng, Jiang Lujun, Wu Yinghao | 2 | April 23, 2025 | Review of the "Proposal on the Remuneration Plan for Directors and Senior Management" | As a member of the Remuneration and Assessment Committee, based on the Company's operational management goals, and on the basis of clarifying job roles, staffing, responsibilities, and job levels, a remuneration and performance management system was formulated. The system reasonably determines salary levels with a focus on job value, insists on the benign interaction between the appreciation of human capital and corporate capital, and simultaneously achieves the value of management personnel. |
| Remuneration and Assessment Committee | Gu Feng, Jiang Lujun, Wu Yinghao | 2 | July 18, 2025 | Review of the "Proposal on the First Phase Employee Stock Ownership Plan of Shanghai Zhezong Group Co., Ltd." and its summary, and the "Management Measures for the First Phase Employee Stock Ownership Plan of Shanghai Zhezong Group Co., Ltd." | The Remuneration and Assessment Committee proposed the "First Phase Employee Stock Ownership Plan (Draft)" and its summary, and the "Management Measures for the First Phase Employee Stock Ownership Plan" to enhance employee cohesion and the Company's competitiveness, establish and improve a shared benefit mechanism for employees and shareholders, and stimulate employees' enthusiasm and creativity. |
| IV. On-site Work at the Company | |||||
| In 2025, I strictly adhered to relevant laws and regulations and the requirements for independent director duties, accumulating 15 working days of on-site work. I listened to reports from relevant personnel regarding the Company's production and operation, financial management, accounting foundation, related party transactions, and external investments. I proactively conducted on-site investigations, paid attention to the Company's daily operating activities, and obtained the information and data necessary for making professional opinions. As a professional in finance, I utilized the opportunity of on-site work to communicate and exchange with the Company's internal audit department and accounting firm, gaining a comprehensive understanding of the Company's operational development and financial situation. Applying my professional knowledge and corporate management experience, I provided constructive opinions and suggestions on the proposals submitted to the Board of Directors, thereby effectively fulfilling my supervisory and guiding role. | |||||
| V. Communication with the Internal Audit Department and Accounting Firm | |||||
| During the reporting period, I actively communicated with the Company's internal audit department and accounting firm, promoting the improvement of the internal audit staff's professional knowledge and audit skills training. I engaged in effective communication and exchange with the accounting firm regarding the annual audit work, safeguarding the objectivity and fairness of the audit results. | |||||
| VI. Key Areas of Focus During Performance of Duties |
- Supervise the review procedures of the Board of Directors and Shareholder Meetings, paying attention to the pre-meeting review procedures of the Board of Directors and the recusal voting on proposals involving related party transactions.
- Supervise potential conflicts of interest within the Company, focusing on scrutinizing related party transactions, and the appointment, dismissal, remuneration, etc., of directors and senior management.
- Supervise the appointment or dismissal of accounting firms undertaking the Company's audit business, paying attention to the qualifications, independence, professionalism, audit process effectiveness, and audit fees of external audit institutions.
- Supervise the internal control evaluation report and its disclosure. Through communication with internal parties of the listed company, information verification, and examination of working papers, I verified the completeness, truthfulness, and reasonableness of the report's content.
- Supervise the financial reports and periodic reports, paying attention to the Company's compliance with enterprise accounting standards and disclosure regulations, and significant accounting and auditing issues in financial accounting reports.
- Review the use of special loans from financial institutions to repurchase the Company's shares, with a focus on the compliance of the share repurchase. VII. Work Done to Protect Investor Rights and Interests
- Inspect the Company's information disclosure I promptly understood the concerns of shareholders, especially small and medium shareholders, supervised and inspected the Company's information disclosure in 2025, ensuring that information was equally accessible to the public. I required the Company to strictly comply with the "Company Law," "Securities Law," "Stock Listing Rules," and the Company's "Information Disclosure Management System" for information disclosure. The Company's information disclosure in 2025 was true, accurate, timely, and complete.
- Exercise voting rights prudently and objectively In 2025, I effectively performed my duties as an independent director, expressing professional opinions during decision-making on proposals reviewed by the Board of Directors and exercising my voting rights prudently. For proposals requiring independent opinions, I promptly gained a full understanding of the relevant situation from the Company and consulted relevant laws and regulations to make independent and objective judgments.
- Investigate the Company's governance structure, internal control, and accounting foundation I continuously paid attention to issues related to the Company's governance structure, internal control, and accounting foundation. I listened to reports from management and followed up on issues requiring improvement.
- Cash dividend and other investor return situations I have continuously paid attention to the Company's investor returns, verifying the compliance of historical cash dividends and share repurchases. In accordance with the spirit of the "Supervision Guidelines for Listed Companies No. 3 - Cash Dividends," I supervised and implemented the "Shareholder Return Plan for the Next Three Years (2024-2026)" and suggested that the Company actively reward investors through cash dividends. VIII. Other Matters In 2025, there were no instances of independent directors proposing to convene board meetings, proposing the appointment or dismissal of accounting firms, or proposing the appointment of external audit institutions and consulting agencies. The Company provided active support for my performance of independent director duties, and there were no situations that hindered my independence. Independent Director: Wu Yinghao April 28, 2026