I. Quality Requirements and Conditions for Quality Responsibility

　　A deduction system will be implemented for products that exceed the specified quality standards. The supplier will be compensated based on a reduced unit price for products exceeding the specified quality standards. The specific methods are as follows:

1. Puyang Coal

　　(1) When the lower calorific value of the applied base is between 4000 kcal and 4200 kcal, discounted acquisition will be implemented. The settlement price for this batch of products will be calculated as: Contract unit price + 4200 x Measured calorific value x 0.97; When the lower calorific value of the applied base is between 3800 kcal and 4000 kcal, the buyer has the right to refuse acceptance and return or exchange the goods. The seller will bear all costs for returns and exchanges. If the buyer agrees to accept the goods, the settlement price will be calculated as: Contract unit price + 4200 x Measured calorific value x 0.87.

　　(2) When the total moisture content of the received base is between 22% and 24%, discounted acquisition will be implemented. The price reduction calculation method is: For the total moisture content exceeding the quality standard, the price reduction amount = Contract unit price x (Total moisture content test value - Total moisture content standard value). When the total moisture content of the coal entering the factory is >24%, the buyer has the right to refuse acceptance and return or exchange the goods. If the goods have already been accepted, a price reduction will be implemented, and the price reduction amount = Contract price x (Total moisture content test value - Total moisture content standard value) x 2.

　　(3) When the total sulfur content of the received base is >0.9%, returns or exchanges will be implemented in principle. If the goods have already been unloaded, a price reduction will be implemented. The calculation method is: For each 0.1% (or part thereof) exceeding the standard in the dry base total sulfur content, 3 yuan/ton will be deducted. When the dry base total sulfur content is >1.1%, the buyer has the right to refuse acceptance and return the goods. If the goods have already been accepted, a price reduction will be implemented. The price reduction calculation method for the portion exceeding 1.1% is: For each 0.1% (or part thereof) exceeding the standard in the dry base total sulfur content, 6 yuan/ton will be deducted.

　　(4) When the volatile matter is between 28% and 30%, 5 yuan/ton will be deducted from this batch of products.

　　(5) When the fixed carbon is between 28% and 30%, 5 yuan/ton will be deducted from this batch of products.

　　(6) When the ash content is >10%, 5 yuan/ton will be deducted from this batch of products.

2. Luliang Coal

　　(1) When the lower calorific value of the applied base is between 3600 kcal and 3800 kcal, discounted acquisition will be implemented. The settlement price for this batch of products will be calculated as: Contract unit price + 3800 x Measured calorific value x 0.97; When the lower calorific value of the applied base is <3600 kcal, the buyer will refuse acceptance. If the buyer agrees to accept the goods, the settlement price will be calculated as: Contract unit price + 3800 x Measured calorific value x 0.87.

　　(2) When the total moisture content is between 28% and 30%, discounted acquisition will be implemented. The price reduction calculation method is: For each unit of total moisture content exceeding the standard, the price reduction amount = Contract unit price x (Total moisture content test value - Total moisture content standard value). When the total moisture content of the coal entering the factory is >30%, the buyer has the right to refuse acceptance and return or exchange the goods. If the goods have already been accepted, a price reduction will be implemented, and the price reduction amount = Contract unit price x (Total moisture content test value - Total moisture content standard value) x 2.

　　(3) When the total sulfur content of the received base is >0.5%, returns or exchanges will be implemented in principle. If the goods have already been unloaded, a price reduction will be implemented. The calculation method is: For each 0.1% (or part thereof) exceeding the standard in the dry base total sulfur content, 3 yuan/ton will be deducted. When the dry base total sulfur content is >0.7%, the buyer has the right to refuse acceptance and return the goods. If the goods have already been accepted, a price reduction will be implemented. The price reduction calculation method for the portion exceeding 0.7% is: For each 0.1% (or part thereof) exceeding the standard in the dry base total sulfur content, 6 yuan/ton will be deducted.

　　(4) When the volatile matter is between 28% and 30%, 5 yuan/ton will be deducted from this batch of products.

　　(5) When the fixed carbon is between 28% and 30%, 5 yuan/ton will be deducted from this batch of products.

　　(6) When the ash content is >12%, 5 yuan/ton will be deducted from this batch of products.

II. Quotation and Payment Settlement

　　1. The validity period of the quotation for this bidding is from October 26, 2021 to November 30, 2021. The price shall not be adjusted or changed during the validity period. Bidding units should fully consider market risks.

　　2. From October 26, 2021 to November 30, 2021, delivery will be made according to the delivery notice issued by the buyer. The supplier is responsible for transporting the goods to the buyer's factory yard and for unloading. The unloading fee will be borne by the supplier.

　　3. Settlement method for this bidding and procurement: The buyer will settle the payment based on the quantity and quality of goods delivered by the supplier. The supplier will issue a VAT special invoice (including 13% VAT special invoice) to the buyer based on the settled amount. The buyer will pay the supplier within 30 days of receiving the invoice.

III. Bid Opening and Evaluation

　　1. Bid opening time: November 1, 2021.

　　2. Evaluation method: Internal bidding by the bidder within 2 days from the bid closing date.

　　3. Notice of winning bid: Within the validity period of the bid, the bidder will notify the winning bidder in writing (Notice of winning bid). The Notice of winning bid is an effective component of the contract.

IV. Contract Agreement Signing

　　1. After receiving the Notice of winning bid issued by the bidder, the winning bidder shall sign the contract agreement at the time and place specified by the bidder.

　　2. If the winning bidder fails to sign the contract agreement as stipulated, the bidder will cancel the winning bid qualification. In this case, the bidder has the right to sequentially select the second winning bidder or the reserve winning bidder.