Zhongzi Technology invests 10 million yuan to carry out energy storage battery PACK industrialization business

Zhongzi Environmental Protection Technology Co., Ltd. (hereinafter referred to as the "Company") has signed a strategic cooperation agreement with Qingdao Nengfeng Electric Co., Ltd. (hereinafter referred to as "Nengfeng Electric"). The two parties will jointly develop the world's leading high-end lithium batteries for energy storage and jointly create a smart energy storage industry chain ecosystem. According to the company's strategic plan and the strategic cooperation agreement between the company and Nengfeng Electric, the company plans to invest 10 million yuan to establish a wholly-owned subsidiary, Zhongzi New Energy Technology (Qingdao) Co., Ltd., to establish a high-end energy storage lithium battery production line in the Nengfeng Electric Dual Carbon Industrial Park to provide industrial support for Nengfeng Electric, and to carry out the energy storage battery PACK industrialization business through close cooperation with strategic customers, local governments and related enterprises to meet the rapidly growing market demand of customers.

Main contents of the cooperation agreement

1. The two parties to the cooperation

Party A: Qingdao Nengfeng Electric Co., Ltd.

Party B: Zhongzi Environmental Protection Technology Co., Ltd.

(II) Scope and duration of cooperation

1. Parties A and B cooperate in the construction of battery pack production lines and supply guarantee. This agreement stipulates the content of the cooperation.

2. This Agreement is valid from March 1, 2023 to February 28, 2026.

(III) Rights and obligations

1. Party A and Party B shall jointly develop the battery pack technology required by Party B, and Party B shall produce in accordance with the "Product Technology Agreement" determined by both parties. When Party A modifies and upgrades the technical solution according to market demand, Party B shall cooperate with Party A to update and iterate the battery pack technology.

2. Party B shall guarantee the production quality to Party A and strictly implement the "Quality Agreement" signed by both parties.

3. Party A guarantees to Party B that Party A's demand will be reported to Party B as soon as possible to confirm whether the order quantity can be accepted. Party B promises to Party A to control the supply chain cost according to market conditions while the demand quantity is stable and the technical process is continuously improved.

4. Party B’s battery pack products shall be delivered on time as agreed in the contract.

5. In order to create a competitive advantage in the entire new energy industry chain and form a regional agglomeration effect, Party B promises to build a supporting battery pack production line based on the production capacity of Party A's production base. Party A must give all production needs in the region to Party B. If the production capacity is not met or other situations that affect production occur, the two parties must negotiate and reach a consensus to resolve the issue.

6. If Party A establishes a factory in a new location, Party A and Party B must reach a consensus on the factory site before Party B can establish supporting production lines and facilities.

7. The module materials shall be purchased by Party B. Party A may make a request or provide a supplier for Party B’s reference. All materials must be verified and qualified before the supplier can be included in Party B’s qualified supplier list.