Article 1 The Detailed Rules are developed according to the relevant national laws and regulations as well as Regulations on Continuous Spot Trading of Far East Material Trading Center Co., Ltd., in order to provide better services for traders, reflect features of physical delivery, and ensure normal operation of physical delivery undertaken by Far East Material Trading Center Co., Ltd.

Article 2 The payment method of physical delivery undertaken by Far East Material Trading Center Co., Ltd. includes cash payment and combination of cash and bank acceptance. Specifically, the cash payment applies to copper, aluminum and rubber, while the combination method applies to trading varieties other than copper, aluminum and rubber (hereinafter referred to as “other variety”), including cable reel, steel strand, steel belt, PVC sheathing materials, cable shielding materials, crosslinking materials, LDPE sheathing materials, MDPE sheathing materials, flame retardant sheathing materials, and PVC resin powder.

Article 3 Issuance, endorsement transfer, writing, and stamping of the bank acceptance shall meet the relevant requirements of Law of the People's Republic of China on Negotiable Instruments.

Article 4　The trading center implements the system of physical delivery declaration for each trading day. The trader who declares delivery must be a business entity who has registered at a relevant industrial and commercial administrative department, has relevant business qualification for the declared delivery commodity, and takes part in the relevant production, operation and consumption.

Article 5 The declaration time of physical commodity is 16:00-16:45 on each trading day. The trading variety including copper, aluminum and copper will be delivered every day, while the delivery declaration of the other trading varieties will be completed within thirty trading days after the transaction.

Article 6 According to the delivery declaration for the listed trading variety made by the buyer’s trader and the seller’s trader (hereinafter referred to as “the buyer” and “the seller”), the electronic trade system of the trading center will automatically match the commodities based on the principles of “equal distribution” and “maximization of daily delivery”. If a trader’s declared delivery is successfully matched but it fails to fulfill its obligations or fulfill only part of its obligations, it shall assume corresponding responsibilities for breaching the contract.

Article 7 After the delivery declaration is finished, the trading center will use its electronic trade system to send the notice of physical delivery to the trading terminal of corresponding trader for the successful delivery declaration; if the delivery matching of delivery declaration fails, the corresponding trader will obtain the compensatory payment for delayed delivery in accordance with the relevant provisions of the trading center.

Article 8 According to the relevant provisions of the trading center, the buyer and the seller with successful matched delivery declarations can pay 20% of transaction price in the cash payment method as the delivery deposit or transfer their transactional performance bonds as the delivery deposit.

Article 9 The seller shall transport the goods in conformity with quantity and other requirements to the delivery warehouse specified by the trading center and handle relevant store-in procedures before 17:00 in the first working day after delivery.

Article 10 The buyer shall pay the rest 80% of funds to the trading center before 17:00 in the first working day after delivery. In case of copper, aluminum or rubber, the buyer must make the residual payment in cash. In case of other trading varieties, the buyer can make the residual payment in cash or by bank acceptance. The amount of the bank acceptance corresponding to each delivery matching shall not be more than 80% of the total delivery amount, and the rest payment can be made by the buyer in cash via its special settlement account in the trading center.

Article 11 If the term to maturity of bank acceptance delivered by the buyer is less than 6 months or if the buyer pays the residual payment in cash, the discount on payment for goods will be calculated as per the coterminous benchmark interest rate of bank loan, and it will be deducted from the delivery payment in cash.

The discount formulas of the payment for goods are as follows:

1. Discount on payment for goods in case of term to maturity of bank acceptance less than 6 months = (180 - term to maturity of delivered acceptance bill) * coterminous benchmark interest rate of bank loan/360 * amount of acceptance bill

2. Discount on payment for goods in case of residual payment made in cash = 180 * coterminous benchmark interest rate of bank loan/360 * cash amount

Article 12 Since the 2^nd workday upon completion of delivery, the buyer can appoint a delivery warehouse at the trading center and handle with the formalities concerning delivery of commodities or entrust such center with delivery at its own costs.

Article 13 The trading center shall transfer the payment made by the buyer to the seller. As for the payment of copper, aluminum and rubber, the trading center shall transfer such payment to the seller within two workdays upon completion of delivery. As for other transaction species, the trading center shall transfer the payment of commodities to the seller within five workdays upon completion of delivery. The seller may ask for the banker's acceptance bill at the financial department of the trading center or entrust the trading center with mailing of such bill or handling of formalities concerning discount. The trading center can prolong the transfer time of commodities payment in case of special circumstances.

Article 14 In case of any dispute in the quality or quantity of the commodities delivered, the buyer shall propose a written application to the trading center within seven workdays upon completion of delivery. The trading center shall coordinate both parties (the buyer and the seller) in solving such dispute. The seller must actively coordinate with the trading center in solving the disputes concerning delivery and shall appoint specially-assigned personnel to the buyer’s site for treatment within two workdays after receiving the feedback concerning delivery disputes, or otherwise the seller will be deemed to accept the mediation scheme proposed by the trading center.

In case the delivery disputes of both parties still cannot be solved, both parties above can entrust the trading center with appointment of a quality inspection organization for quality identification. The responsible party of quality or quantity disputes shall bear relevant costs arising from such inspection, as well as the resultant direct economic loss.

Article 15 In case of no overdue application being proposed, the buyer will be deemed to accept the commodities delivered, and the trading center will no longer accept and hear any application concerning commodities disputes. In case the disputes are solved, the seller shall submit the VAT special invoice in full amount to the trading center within 15 days upon completion of delivery. After confirming such invoice is correct, the trading center shall return the cash deposit to the seller within two workdays.

Article 16 The seller’s trader shall submit a warehousing application to the delivery warehouse specified as required before delivering goods to such warehouse. Afterwards, the warehouse specified shall decide on whether warehousing is allowable or not within 2 hours. In case warehousing is not allowable, sufficient reasons shall be proposed and such warehouse shall bear corresponding liquidated damages for delayed delivery caused to the seller as per the specific delay in warehousing.

Article 17 After arrival of the commodities at the delivery warehouse specified, the commodities arrived and relevant documents shall be checked and verified as per Management Methods for Appointed Delivery Warehouse of Far East Material Trading Center Co., Ltd.

During delivery acceptance of commodities, the seller shall witness such acceptance at the delivery warehouse specified. If not, the seller’s trader will be deemed to accept the acceptance results made by such warehouse.

After receiving the goods delivered by the trader, the delivery warehouse specified shall fill in the Registered Warehouse Receipt as required.

Article 18 The buyer shall inform the trading center of the followings in the specified form before taking delivery of commodities: the time taking delivery of goods, names and ID numbers of the persons taking delivery of goods, numbers of driving licenses of the vehicles involved in. After the above information is proven correct through review by the trading center, relevant personnel can take delivery of goods at the specified delivery warehouse by virtue of the ID numbers and the driving licenses of the vehicles involved in.

The buyer can entrust the specified delivery warehouse with forwarding. However, the buyer shall witness such forwarding at the warehouse. If not, the buyer will be deemed to recognize that the goods forwarded by the specified delivery warehouse are correct.

Article 19 See the electronic trading contracts of various listed commodities for the minimum delivery unit and quality standards of the commodities to be delivered.

Article 20 Delivery place: the specified delivery warehouse of the trading center.

Article 21 See the public notices issued on the website of the trading center for the details concerning delivery information of various listed commodities.

Article 22 The buyer and the seller involved in delivery of material objects shall pay the handling charges concerning delivery to the trading center. See the electronic trading contracts of various listed commodities for the specific standards concerning such charges.

Article 23 As for the charges arising from delivery and warehousing of commodities and generated during warehousing, the specific items and standards shall be formulated by the specified delivery warehouse and such items and standards formulated shall be submitted to the trading center for verification.

Article 24 The methods concerning calculation and collecting of charges at the specified delivery warehouse are as follows:

(I) The storage charges shall be collected per day. As for the commodities warehoused before the delivery date (including the delivery date), such charges shall be paid by the seller. As for those warehoused after the delivery date, such charges shall be paid by the buyer.

(II) The storage charges shall be collected by the specified delivery warehouse as per relevant regulations and standards, with relevant certificates being issued.

Article 25 Default in delivery will be constituted once one of the followings occurs:

(I) In case the Registered Warehouse Receipt submitted by the seller is insufficient within the delivery deadline specified;

(II) The buyer fails to pay the full-amount loan within the delivery deadline specified;

(III) The commodities delivered by the seller are not in line with the standards specified by the trading center;

(IV) The seller fails to issue the VAT special invoice corresponding to the goods delivered within the deadline specified.

Article 26 The formula calculating the quantities concerning delivery default of the buyer and the seller is as follows:

Quantities concerning delivery default of the seller (shou) = the quantities of the registered warehouse receipt which shall be submitted (shou) – the quantities of the registered warehouse receipt submitted (shou)

The quantities concerning delivery default of the buyer = ceil [(payment of goods which shall be paid – payment of goods paid) ÷ settlement price of delivery ÷ minimum delivery unit] * minimum delivery unit

Ceil: the minimum positive integral which is more than or equal to the number given.

Article 27 In case of default in delivery, the trading center shall notice the default party and the observant party in person, or through phones, faxes or electronic information on the date of default and shall announce relevant information in a proper form.

Article 28 In case of default in delivery, the default party shall pay 10% of the defaulting contract price as liquidated damages. Meanwhile, the following measures shall be taken:

(I) In case the seller is the default party, the delivery of the default contract of the seller shall be terminated, and the trading center shall return the loan of corresponding amount to the buyer;

(II) In case the buyer is the default party, the delivery of the default contract of the buyer shall be terminated, and the trading center shall return the Registered Warehouse Receipt of corresponding amount to the seller.

Article 29 In case both the buyer and the seller are in default, the trading center will terminate the delivery, and 5% of the default contract price will be fined for both parties above as the liquidated damages, to serve as the loan loss provision of the trading center.

Article 30 In case of any disputes in the buyer and the seller, such disputes shall be solved through counter-verification by both parties above generally. Besides, such disputes can also be submitted to the quality inspection organization specified by the trading center for review. The review results shall serve as the basis for solving disputes.

Article 31 Far East Material Trading Center Co., Ltd. has right to interpret and revise the Detailed Rules.

Article 32 The Detailed Rules are implemented from the date of publishing.

Far East Material Trading Center Co., Ltd.

June 13, 2014