The first-instance judgment of the subsidiary of Shenzhen Xinxing clarified the amount of debt but the realization result remains uncertain.

Recently, Shenzhen Newstar Light Alloy Materials Co., Ltd. issued an announcement on the progress of litigation involving its wholly-owned subsidiary Songyan New Energy Materials Co., Ltd. The case has been ruled in the first instance, with Songyan New Energy as the plaintiff and defendants including Dongguan Shanshan Battery Materials Co., Ltd., among others. The amount involved in the case is the principal amount of 12,102,063.85 yuan of the purchase price and the loss of overdue payment, with a total of 102,994.59 yuan for case acceptance and preservation fees. The court confirmed the bankruptcy claim of Songyan New Energy against Dongguan Shanshan Battery Materials Co., Ltd., dismissed other litigation requests, and the related costs are to be borne by the defendant. The company has made a full provision for bad debts for this matter in 2024, and this judgment will not affect the profit and loss for 2025. The defendant has entered bankruptcy reorganization proceedings, and the outcome of subsequent debt realization is uncertain. As of the announcement date, the company and its controlling subsidiaries have no other major litigation or arbitration matters that have not been disclosed but should be.