Core Viewpoint - The company announced the progress of a lawsuit involving its wholly-owned subsidiary, Wuhan Lianhua Engineering Design Co., Ltd., which has been ordered to receive a payment of approximately 68.83 million yuan for engineering services, along with additional fees and costs [2][4]. Group 1: Lawsuit Overview - The lawsuit was initiated by Wuhan Lianhua Engineering against Shanxi Henghui Environmental Technology Co., Ltd. regarding a construction contract dispute [3]. - The initial judgment was made by the Intermediate People's Court of Yuncheng, Shanxi Province, in October 2025, which was later upheld by the Shanxi Provincial High Court [4][5]. Group 2: Judgment Details - The final ruling requires the defendant to pay 68,825,564.24 yuan in engineering fees, 1,922,414.25 yuan in technical service fees, and 550,000 yuan in design fees [2][4]. - The costs associated with the case, including court fees and expert fees, are to be borne by the respective parties as specified in the judgment [2][4]. Group 3: Impact on the Company - Following the judgment, Wuhan Lianhua Engineering will apply for enforcement of the ruling, and the project revenue and receivables have not yet been confirmed [2][7]. - The company will recognize project income and profits based on the collection of the awarded amounts in the future [7].

Core Viewpoint - The company, Hengli Industrial Development Group Co., Ltd., is facing legal challenges related to construction contract disputes, which may impact its financial performance in the future [1][4]. Summary by Sections 1. Basic Information of the Lawsuit - The company and its wholly-owned subsidiary, Yueyang Hengli Auto Parts Co., Ltd., were sued by Hunan Fangyuan Architectural Engineering Design Co., Ltd. and Hunan Pioneer Construction Engineering Co., Ltd. due to construction contract disputes [1]. 2. Judgment Details - **Case One**: The court ordered the subsidiary to pay design fees of 459,246.15 yuan and overdue payment penalties based on the Loan Prime Rate (LPR) from September 27, 2024, until payment is made. The subsidiary must also pay engineering fees totaling 37,645,448.5 yuan, with the design company having priority in claims against the project [1][2]. - **Case Two**: The company is required to refund a deposit of 5,500,000 yuan and associated costs, with interest calculated at an annual rate of 12% from December 16, 2021, until actual payment is made [2][3]. 3. Financial Implications - The company acknowledges that the ongoing litigation may have uncertain impacts on its current and future profits, pending the outcome of the appeals process [4]. 4. Other Legal Matters - As of the announcement date, there are no undisclosed litigation or arbitration matters involving the company or its subsidiary [3]. 5. Stock Market Status - The company's stock entered a delisting preparation period on June 25, 2025, with the last trading date expected to be July 15, 2025, after which the stock will be delisted [4].