Common use of INTERNAL CONTROL MEASURES Clause in Contracts

INTERNAL CONTROL MEASURES. In order to safeguard the interests of the Company and the Shareholders as a whole and to ensure that the pricing policies and the annual caps are complied with, the Company has adopted the following internal control measures: • The Group maintains price lists and a database containing historical transaction records and relevant terms and conditions. The information in the database is obtained in the course of the Group’s operations, including information in respect of transactions entered into by different divisions/departments of the Group. The Company will continue to develop and maintain the database so as to include pricing information in relation to materials sold by the Group in the future. Designated personnel of the Group are responsible for the maintenance of the database, and the database is generally updated as soon as practicable after the materialization or consummation of a sales/provision of service transaction. A management personnel of the Group is designated to monitor and supervise the maintenance of the database to ensure that up-to-date records are properly kept. The Company will also conduct random checks on the database so as to ensure that effective and sound internal control measures are in place so that continuing connected transactions with the Kelun Group will be conducted on a fair and reasonable basis. • The relevant business units and departments of Group will regularly monitor and review the prices/ fees of and terms under which continuing connected transactions are conducted with the Kelun Group in order to ensure that such continuing connected transactions are conducted on normal commercial terms, in accordance with the annual caps set by the Company, and the terms are no less favourable to the Group than those available to/from independent third parties. The Company will designate specific personnel from the compliance/internal control department to monitor the continuing connected transactions with the Kelun Group and any irregularities will be reported to the senior management of the Group in a timely manner. • The Group will conduct regular internal checks to ensure that the internal control measures in respect of the continuing connected transactions with the Kelun Group remain intact and effective. • The Company’s external auditors will annually review the relevant continuing connected transactions with the Kelun Group subject to annual view requirement to check and confirm (amongst others) whether the pricing policies have been adhered to, whether the continuing connected transactions were conducted in accordance with the agreements governing them and whether the relevant annual caps have been exceeded. • The independent non-executive Directors will annually review the relevant continuing connected transactions with the Kelun Group to check and confirm whether such transactions have been conducted in the ordinary and usual course of business of the Company, on normal commercial terms, in accordance with the agreements governing them, on terms that are fair and reasonable and in the interests of the Shareholders as a whole, and whether the internal control procedures put in place by the Company are adequate and effective to ensure that such continuing connected transactions with the Kelun Group are conducted in accordance with the pricing policies adopted by the Group and the annual caps pursuant to the Listing Rules.

INTERNAL CONTROL MEASURES. In order to safeguard To protect the interests of the Company and the Shareholders as a whole and to ensure that the pricing policies and the annual caps are complied withGroup, the Company has adopted Group will adopt the following internal control measures: • The Group maintains price lists and a database containing historical : 1. Pursuant to the connected transaction records and relevant terms and conditions. The information in the database is obtained in the course management rules of the Group’s operationsCompany, including information in respect of transactions entered into by different divisions/departments of the Group. The Company will continue to develop and maintain the database so as to include pricing information in relation to materials sold by the Group in the future. Designated relevant personnel of the Group are responsible for will closely monitor the maintenance of the database, and the database is generally updated as soon as practicable after the materialization or consummation of a sales/provision of service transaction. A management personnel transactions of the Group is designated to monitor and supervise under the maintenance of the database Framework Agreement to ensure that up-to-date records are properly keptthe transaction amounts do not exceed the annual caps set for the transactions under the Framework Agreement; 2. The Pursuant to the Framework Agreement, the Group and Xxxxxx Xxxxxxxx Group may from time to time enter into separate specific business contracts for each specific transaction under the Framework Agreement as necessary. Meanwhile, pursuant to the connected transaction management rules of the Company, each transaction to be actually entered into by the Group shall be subject to the appropriate approval of the relevant departments of the Company will also conduct random checks on the database so as to ensure that effective each transaction is in line with the pricing policy and sound internal control measures are in place so that principal terms of the Framework Agreement; 3. The auditors of the Company shall conduct annual reviews on pricing and annual caps of such continuing connected transactions with to ensure that the Kelun Group will be transaction amounts are within the annual caps and that the transactions in all material aspects are conducted on a fair and reasonable basisthe terms in the relevant agreement of such transactions; and 4. • The relevant business units and departments of Group will regularly monitor and review independent non-executive Directors shall conduct annual reviews on the prices/ fees of and terms under which continuing connected transactions are conducted with contemplated under the Kelun Group in order Framework Agreement to ensure that such continuing connected transactions are conducted on normal commercial terms, in accordance with the annual caps set by the Company, terms or better and the terms are no less favourable to the Group than those available to/from independent third parties. The Company will designate specific personnel from the compliance/internal control department to monitor the continuing connected transactions with the Kelun Group and any irregularities will be reported to the senior management of the Group in a timely manner. • The Group will conduct regular internal checks to ensure that the internal control measures in respect of the continuing connected transactions with the Kelun Group remain intact and effective. • The Company’s external auditors will annually review the relevant continuing connected transactions with the Kelun Group subject to annual view requirement to check and confirm (amongst others) whether the pricing policies have been adhered to, whether the continuing connected transactions were conducted in accordance with the agreements governing them and whether the relevant annual caps have been exceeded. • The independent non-executive Directors will annually review the relevant continuing connected transactions with the Kelun Group to check and confirm whether such transactions have been conducted in the ordinary and usual course of business of the CompanyGroup, on normal commercial terms, in accordance with and the agreements governing them, on terms that thereof are fair and reasonable and are in the interests of the Company and its Shareholders as a whole, and whether make a confirmation in the internal control Company’s annual report. In addition, the Group will endeavour to fully monitor the total transaction amount under the Framework Agreement with respect to the relevant annual cap, and the information on the connected transactions (including the quarterly transaction amount and the cumulative amount) will be reviewed on a quarterly basis, and if necessary, the Group will follow the relevant procedures put to conduct approval procedures to increase the annual cap of connected transactions in place by the Company are adequate and effective a timely manner, prepare relevant announcement(s) and/or obtain independent Shareholders’ approvals (if necessary) to ensure that such continuing connected transactions compliance with the Kelun Group are conducted in accordance with requirements under the pricing policies adopted by the Group and the annual caps pursuant to the Hong Kong Listing Rules.

INTERNAL CONTROL MEASURES. In order to safeguard ensure that all continuing connected transactions of the interests Group comply with the Listing Rules, the Company has formulated and continuously improved the management measures for connected transactions which sets forth the procedures for approval of connected transaction contracts and management of continuing connected transactions. Before entering into the Value-Added Services Framework Agreement in its ordinary and usual course of business, the Group has conducted research study on the market price fairness by obtaining and comparing the prevailing price quotations and pricing terms of the same or similar transactions from other independent suppliers in the vicinity according to its internal approval and monitoring procedures for continuing connected transactions, in order to select suppliers upon comprehensive consideration of various assessment criteria (including but not limited to the prices, the level and quality of tailor-made services, suitability, payment terms, and time required for the provision of goods or services) and determine the relevant procurement terms through negotiations based on the business needs of the project, the types and scale of the procurement. Such quotes, together with the offer from the connected person, and the Value-Added Services Framework Agreement shall be reviewed by the management, finance personnel and legal personnel of the Company according to the Group’s internal approval and monitoring procedures. Afterwards, the Shareholders as a whole and to ensure that Value-Added Services Framework Agreement, the pricing policies continuing connected transactions contemplated thereunder and the annual caps are complied with, would be submitted to the Company has adopted the following internal control measures: • The Group maintains price lists Board for consideration and a database containing historical transaction records and relevant terms and conditionsapproval. The information in the database is obtained in the course finance department of the Group’s operations, including information in respect of transactions entered into by different divisions/departments of the Group. The Company will continue to develop and maintain the database so as to include pricing information in relation to materials sold by the Group in the future. Designated personnel relevant members of the Group are will be responsible for the maintenance monthly reporting of the databaseamount of continuing connected transactions to the finance department of the Company for monitoring the annual caps of the relevant transactions every month and issuing warning to the Board, relevant departments and the database is generally updated as soon as practicable after the materialization or consummation of a sales/provision of service transaction. A management personnel business units of the Group is designated when the utilization rate of annual cap reaches 80%, which will facilitate the Board to monitor and supervise consider implementation of relevant response measures such as the maintenance revision of the database to ensure that up-to-date records are properly keptannual cap. The Company will also conduct random checks on the database so as to ensure that effective and sound internal control measures are in place so that continuing connected transactions with the Kelun Group will shall also be conducted on a fair and reasonable basis. • The relevant business units and departments of Group will regularly monitor and review the prices/ fees of and terms under which continuing connected transactions are conducted with the Kelun Group in order to ensure that such continuing connected transactions are conducted on normal commercial terms, in accordance with the annual caps set by the Company, and the terms are no less favourable to the Group than those available to/from independent third parties. The Company will designate specific personnel from the compliance/internal control department to monitor the continuing connected transactions with the Kelun Group and any irregularities will be reported to the senior management of the Group in a timely manner. • The Group will conduct regular internal checks to ensure that the internal control measures in respect of the continuing connected transactions with the Kelun Group remain intact and effective. • The Company’s external auditors will annually review the relevant continuing connected transactions with the Kelun Group subject to annual view requirement to check review and confirm (amongst others) whether the pricing policies have been adhered to, whether the continuing connected transactions were conducted in accordance with the agreements governing them and whether the relevant annual caps have been exceeded. • The audit by independent non-executive Directors will annually review the relevant continuing connected transactions with the Kelun Group and auditors respectively every year pursuant to check and confirm whether such transactions have been conducted in the ordinary and usual course of business Chapter 14A of the CompanyListing Rules. Among which, on normal commercial termsthe independent auditor shall sample check, in accordance with among other things, the agreements governing them, on compliance of such pricing terms that are fair and reasonable and in the interests of the Shareholders as a whole, and whether the internal control procedures put in place by the Company are adequate and effective to ensure that such continuing connected transactions with the Kelun Group are conducted in accordance with the pricing policies adopted by or mechanisms under the Group and the annual caps pursuant to the Listing RulesValue-Added Services Framework Agreement.