2020 Annual Report on the Work of the Supervisory Board

Dear Shareholders:

2020 In [Year], the Company’s Supervisory Board, in accordance with the provisions of the Company Law, the Securities Law, and other applicable laws and regulations, as well as the Articles of Association, diligently fulfilled its supervisory duties, strengthened oversight of the Company’s operations and management, and played a positive role in promoting standardized operations and sound development. It effectively safeguarded the legitimate rights and interests of shareholders, the Company, and employees, thereby providing a reliable guarantee for the smooth conduct of the Company’s production and business activities. The specific contents of the report are set out below:

I. Work of the Supervisory Board

2020 In accordance with the Company Law, the Articles of Association, and other relevant laws and regulations, the Supervisory Board has conscientiously fulfilled its duties by conducting necessary reviews and oversight of the company’s lawful operations, decision-making procedures, business management, related-party transactions, financial condition, and the performance of duties by directors and senior management.

1 Members of the Supervisory Board attended each board meeting and consistently conducted independent reviews of the company’s major issues.

2 The Supervisory Board actively monitors the company’s major operational and management activities, oversees the development of its internal control system, and exercises oversight over major corporate decisions and business management procedures.

3 The Supervisory Board diligently performs its function of overseeing the company’s finances, organizing inspections and oversight of the company’s various internal control systems and internal audit systems.

4 , supervised the performance of duties by the company’s directors and senior management.

• Meetings and Resolutions of the Company’s Supervisory Board

2020 year The Supervisory Board held a total of five meetings, as follows:

( I) Ninth Meeting of the Third Supervisory Board

The ninth meeting of the third session of the Supervisory Board was held on February 18, 2020, and adopted by a show of hands. It reviewed and approved the “Proposal on the 2019 Audit Report of Xiangyang Changyuan Donggu Industrial Co., Ltd.,” the “Proposal on the Company’s Internal Control Self-Evaluation Report,” the “Proposal on the Company’s 2019 Financial Final Accounts Report,” the “Proposal on the Company’s 2020 Financial Budget Report,” the “Proposal on the Company’s 2019 Profit Distribution,” the “Proposal on the Supervisory Board’s Work Report for 2019,” the “Proposal on Re-appointing Zhongshen Zhonghuan Certified Public Accountants (Special General Partnership) as the Company’s Auditor for 2020,” and the “Proposal on the Establishment by the Company of a Special Deposit Account for Raised Funds.”

(II) The Tenth Meeting of the Third Supervisory Board

The tenth meeting of the third session of the Supervisory Board was held on May 19, 2020, and adopted by a show of hands. It reviewed and approved the “Proposal Regarding the ‘Review Report of Xiangyang Changyuan Donggu Industrial Co., Ltd. for the First Quarter of 2020’.”

(III) Eleventh Meeting of the Third Supervisory Board

The eleventh meeting of the third session of the Supervisory Board was held on June 18, 2020, and adopted by a show of hands. The meeting reviewed and approved the “Proposal on Using Proceeds from the Offering to Replace Previously Self-Funded Capital Advanced for Projects Funded by the Offering.”

(IV) The Twelfth Meeting of the Third Session of the Supervisory Board

The twelfth meeting of the third session of the Supervisory Board was held on August 9, 2020, and voting was conducted by a show of hands. The meeting reviewed and approved the “Proposal Regarding the Company’s 2020 Semi-Annual Financial Report,” the “Proposal Regarding the Company’s 2020 Semi-Annual Report and Summary,” the “Proposal Regarding the Company’s 2020 Semi-Annual Profit Distribution Plan,” and the “Special Report on the Deposit and Actual Use of Funds Raised in the First Half of 2020.”

(V) Thirteenth Meeting of the Third Supervisory Board

The 13th meeting of the third session of the Supervisory Board was held on October 30, 2020, and adopted by a show of hands. The meeting reviewed and approved the “Proposal Regarding the Company’s Third Quarter Report for 2020,” the “Proposal Regarding the ‘Securities Investment Management System,’” and the “Proposal Regarding the Company’s Management of Securities Investments.”

III. The Supervisory Board’s independent opinion on the company’s operations.

By convening meetings of the Supervisory Board, attending key corporate events such as Board of Directors and Shareholders’ General Meetings, and reviewing relevant documents, we have exercised oversight over the entire process of the Company’s lawful business management and have formulated the following opinions:

1 , Review the company’s compliance with the law

During the reporting period, the work of the company’s board of directors and senior management complied with the relevant provisions of the Company Law, the Securities Law, the Shanghai Stock Exchange Listing Rules, the company’s Articles of Association, the rules of procedure for the three meetings, and various internal control systems; the decision-making procedures were lawful and valid. The company’s directors and senior management exercised due diligence and faithfully implemented the resolutions of the shareholders’ meeting and the board of directors, and no instances were found of violations of laws, regulations, or the company’s articles of association, or of actions detrimental to the company’s interests. At the same time, the company has strictly fulfilled its information disclosure obligations in a timely manner in accordance with the requirements of the Shanghai Stock Exchange Listing Rules.

2 Review the company’s periodic reports

The Supervisory Board carefully reviewed the Company’s 2019 Annual Audit Report, the Q1 2020 Review Report, the 2020 Semi-Annual Report, and the Q3 2020 Report. It concluded that the preparation and review of each report complied with applicable laws, regulations, and stock exchange rules; that the reports’ contents faithfully, accurately, and completely reflect the Company’s financial position and operating results, with no false records, misleading statements, or material omissions; and that, during the preparation and review processes, there were no leaks of inside information or any other acts in violation of laws, regulations, the Articles of Association, or detrimental to the Company’s interests.

3 , Review the company’s financial status

During the reporting period, the Supervisory Board supervised and examined the company’s financial condition and financial management. It concluded that the company has a sound financial system, standardized financial management practices, and healthy financial operations. The preparation of the company’s financial statements complies with the Enterprise Accounting Standards and other relevant regulations, with no material omissions or false entries. The financial reports faithfully and objectively reflect the company’s financial position and operating results.

4 , The Company’s Related-Party Transactions

No related-party transactions occurred in 2020, and the Supervisory Board raised no objections.

5 , Supervise the use of funds raised by the company

The Supervisory Board reviewed the use and management of the company’s raised funds during the reporting period and concluded that the company has strictly complied with the Company Law, the Securities Law, and the company’s Measures for the Administration of the Use of Raised Funds, as well as other relevant regulations, in the use and management of such funds. No violations of the rules governing the use of raised funds were found, and the specific details of fund utilization are consistent with the information previously disclosed.

IV. Work Plan of the Supervisory Board for 2021

2021 This year, members of the company’s Supervisory Board must continuously enhance their professional competence, strengthen their sense of responsibility, adhere to principles, act impartially, and fulfill their duties diligently. At the same time, in accordance with the Company Law and the Articles of Association, the Supervisory Board should further improve the corporate governance structure, work together with the Board of Directors and all shareholders to promote the company’s standardized operations, reinforce self-discipline, intensify oversight, and earnestly assume responsibility for safeguarding the rights and interests of the broad shareholder base.

2021 The annual work plan of the Supervisory Board mainly covers the following areas:

1. Oversee the company’s lawful and compliant operations, and ensure the establishment and effective functioning of its internal control system.
2. Conduct irregular audits of the company’s financial condition and oversee its accounting activities by regularly reviewing financial reports.
3. Oversee the diligence and accountability of directors and senior management to prevent actions that could harm the company’s interests.
4. Strengthen oversight of major corporate matters, including investments, asset disposals, and related-party transactions, and increase attention to information disclosure.

                          Supervisory Board of Xiangyang Changyuan Donggu Industrial Co., Ltd.

2021 March 22