Changhong Energy: Announcement on the Progress of Litigation Involving its Holding Subsidiary

Changhong Energy announced that in the lawsuit between its controlling subsidiary Jiechuang Company and Haoneng Company, the People's Court of Chongqing Free Trade Pilot Zone rendered a judgment of first instance on June 8, 2026, rejecting all of Jiechuang Company's claims. Jiechuang Company claimed that the machinery and equipment provided by Haoneng Company had quality issues, leading to quality risks in the products produced by the plaintiff, and requested compensation of 147 million yuan for economic losses and 5.731 million yuan for liquidated damages. Haoneng Company argued that it had fully performed its contractual obligations, the equipment did not have quality issues, and Jiechuang Company's claims lacked factual and legal basis.