Shanghai Industrial Development Co., Ltd. Announcement on the Progress of Major Litigation

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Stock code: 600748 Stock abbreviation: SAI Development Announcement No.: Lin 2026-12

Shanghai Industrial Development Co., Ltd.

Announcement on the Progress of a Major Lawsuit

The board of directors of this company and all of its directors hereby guarantee that there are no false records, misleading statements, or material omissions in the contents of this announcement, and assume legal responsibility for the truthfulness, accuracy, and completeness of the contents.

Key Points:

● Stage of the case: the court of first instance’s judgment;

● Status of the listed company in the case: defendant;

● Amount involved: The plaintiff, Junzheng (Ningbo Meishan Bonded Port Area) Equity Investment Partnership (Limited Partnership) (hereinafter referred to as “Junzheng Partnership”), filed the lawsuit against Shanghai Industrial Development Co., Ltd. (hereinafter referred to as the “Company” or “SAI Development”) and other defendants starting in 2024, with the amount involved of approximately RMB 801,055.56 thousand yuan. Subsequently, during the course of the litigation, the plaintiff changed its claims and adjusted the litigation amount to approximately RMB 431,302.11 thousand yuan;

● Whether it will have a negative impact on the listed company’s profit or loss: According to the court of first instance’s judgment in this case, at this stage it will not have a negative impact on the Company’s profit or loss; however, this lawsuit is still within the statutory appeal period and the judgment has not yet become effective, so the impact on the Company’s current-period profit or loss or future-period profit or loss remains uncertain. The Company will continue to closely monitor the subsequent developments of the case and prudently assess the impact on the Company in accordance with relevant laws and regulations and the Company’s accounting standards, and will timely fulfill its information disclosure obligations. Investors are kindly requested to pay attention to investment risks.

I. Basic Information on This Lawsuit

The Company received, in September 2024, the “Notice of Responding to a Suit” [(2024) Hu 74 Min Chu 754] and related documents delivered by the Shanghai Financial Court. The plaintiff, Junzheng Partnership, filed the lawsuit against the Company and other defendants (for specific contents, please see the Company’s announcement Lin 2024-38) on the grounds of a contract dispute, based on the “Share Subscription Contract for Non-Public Issuance of Shares by the Company” and the “Share Subscription Supplementary Agreement (II)” signed with the Company in 2015. The Shanghai Financial Court conducted a trial in accordance with the ordinary procedure. The Company engaged legal counsel to attend the hearing.

II. Specific Circumstances of This Lawsuit

Plaintiff: Junzheng Partnership

Defendants: SAI Development (Defendant 1), Shanghai Industrial (Group) Co., Ltd. (Defendant 2, hereinafter referred to as “SIG”), Pan-China Certified Public Accountants (Special General Partnership) (Defendant 3, hereinafter referred to as “Pan-China CPA”), Shanghai Dongzhou Asset Appraisal Co., Ltd. (Defendant 4, hereinafter referred to as “Dongzhou Company”)

Case Facts:

In April 2015, Junzheng Partnership, the plaintiff, and SAI Development, the defendant, signed the “Share Subscription Contract for Non-Public Issuance of Shares by Shanghai Industrial Development Co., Ltd.”, which stipulated that the plaintiff would subscribe for 68,376,068 shares at RMB 11.70 per share by paying cash to SAI Development. In November 2015, the plaintiff and SAI Development signed the “Share Subscription Supplementary Agreement (II)”. The parties finally confirmed that the plaintiff would subscribe for 51,468,033 shares at RMB 11.63 per share, for a total subscription amount of RMB 598,573,223.79. The principal uses of the funds raised by SAI Development were: 1. acquisition of 100% equity interest in Shanghai SEI Holdings Co., Ltd. (hereinafter referred to as “SEI Holdings”); 2. Phase II and Phase III projects of the Qingdao International Beer City renovation project; 3. acquisition of 42.3549% of the shares of Shanghai Longchuang Energy-Saving System Co., Ltd. (hereinafter, prior to acquisition by SAI Development, referred to as “Longchuang Energy-Saving”; after acquisition, it was ultimately renamed as Shanghai SAI Longchuang Intelligent Technology Co., Ltd., abbreviated as “SAI Longchuang”); 4. providing capital increase to Longchuang Energy-Saving to repay bank loans and replenish working capital.

In January 2016, the plaintiff paid the share subscription payment and completed the share subscription.

In January 2022, SAI Development disclosed the “SAI Development Announcement on Receipt of the Regulatory Work Letter from the Shanghai Stock Exchange and a Major Risk Warning Announcement” (for specific contents, please see the Company’s announcement Lin 2022-01). In April 2022, the Shanghai Stock Exchange issued an information disclosure regulatory inquiry letter to SAI Development, requiring disclosure of matters including accounting corrections, fund occupation, and non-standard internal control audit opinions (for specific contents, please see the Company’s announcements Lin 2022-16 and related announcements).

In April 2024, the Shanghai Regulatory Bureau of the China Securities Regulatory Commission (hereinafter referred to as the “Shanghai CSRC”) issued an “Administrative Penalty Decision” (Hu [2024] 10-16), imposing administrative penalties for violations such as failure to timely disclose and false records on SAI Development (for specific contents, please see the Company’s announcement Lin 2024-14). In June of the same year, the Shanghai CSRC issued an “Administrative Penalty Decision” (Hu ([2024] 025)) to impose an administrative penalty on Cao Wenlong, the former chairman and general manager of SAI Longchuang.

In September 2024, the Second Intermediate People’s Court of Shanghai issued a criminal judgment in Criminal Case No. (2023) Hu 02 Xing Chu 31, rendering the court of first instance’s criminal judgment against Cao Wenlong, the former chairman and general manager of SAI Longchuang, and others (for specific contents, please see the Company’s announcement Lin 2024-39).

In December 2025, the Shanghai High People’s Court rendered a court of second instance judgment for Cao Wenlong (for specific contents, please see the Company’s announcement Lin 2025-41).

Claims:

The plaintiff requests the court to order: 1. the defendant SAI Development to compensate the plaintiff for the investment principal loss in the amount of RMB (currency identical hereinafter) 598,573,223.79 caused by the plaintiff due to fraudulent issuance, and for the interest loss caused thereby. The total principal and interest amount shall deduct the dividend amount of RMB 34,004,929.44 obtained by the plaintiff during the period of holding SAI Development’s securities; 2. the defendant SAI Development to repurchase the securities held by the plaintiff from the defendant SAI Development (number of shares: 66,908,443 shares); 3. the defendant SIG to bear joint and several liability for the compensation in item 1 of the lawsuit request with the defendant SAI Development; 4. the defendant Pan-China CPA and Dongzhou Company to bear joint and several liability for compensation within the scope of fault; 5. to adjudicate the litigation costs in this case and attorneys’ fees in accordance with law.

During the course of the litigation, the plaintiff adjusted the cause of action to a dispute arising from liability for securities misrepresentation and changed its claims to request the court to order: 1. the defendant SAI Development to compensate the plaintiff for the investment loss of RMB 431,302,116.29 caused by the plaintiff due to misrepresentation; 2. the defendant SIG and the defendant SAI Development to bear joint and several liability; 3. the defendant Pan-China CPA and Dongzhou Company, together with the defendant SAI Development and SIG, to bear joint and several liability; 4. the litigation costs and attorneys’ fees in this case (RMB 350,000) to be adjudicated in accordance with law.

Company’s Statement and Defense Opinion:

SAI Development disagrees with the plaintiff’s lawsuit requests:

1. As a professional investor, the plaintiff shall, according to law, be deemed not to have made its investment decision in reliance on the information involved in the case.

2. This case is a dispute arising from a professional investor’s participation in “over-the-counter” and “non-public issuance.” According to law, the relevant elements of ordinary tort should be examined.

3. Dongzhou Company conducted an appraisal of Longchuang Energy-Saving using the income approach, and the “Earnings Forecast Report” of Longchuang Energy-Saving belongs to forward-looking information. In law, neither of the above constitutes misrepresentation.

4. The two disclosure matters claimed by the plaintiff are not material.

5. The plaintiff’s act of contracting occurred before the disclosure documents for the information involved in the case. There is no causal relationship between the information disclosure claimed by the plaintiff and the plaintiff’s investment decision.

6. The subscription price of the plaintiff was not affected by the content of the information disclosure.

III. Status of the Court’s Ruling on the Lawsuit

Recently, the Company received the “Civil Judgment” delivered by the Shanghai Financial Court [(2024) Hu 74 Min Chu 754]. Based on the related evidence in this lawsuit, the court held that the transaction causation between the plaintiff’s investment decision and the alleged misrepresentation in the case is not established, and therefore it has no authority to order the defendants to compensate the plaintiff for its investment losses.

Pursuant to Article 1, paragraph 1, Article 4, and Article 12 of the “Several Provisions of the Supreme People’s Court on the Trial of Civil Compensation Cases for Infringement Caused by False Statements in the Securities Market,” the Shanghai Financial Court ruled as follows:

All claims of the plaintiff, Junzheng Partnership, are dismissed.

The litigation acceptance fee of RMB 2,200,060 shall be borne by Junzheng Partnership.

IV. Impact of the Progress of This Lawsuit on the Company’s Profit for the Current Period or Future Periods

According to the court of first instance judgment in this case, at this stage it will not have a negative impact on the Company’s profit or loss; however, this lawsuit is still within the statutory appeal period and the judgment has not yet become effective, so the impact on the Company’s profit or loss for the current period or future periods remains uncertain. The Company will continue to closely monitor the subsequent developments of the case and prudently assess the impact on the Company in accordance with relevant laws and regulations and corporate accounting standards, and will timely fulfill its information disclosure obligations. Investors are kindly requested to pay attention to investment risks.

V. Whether the Company Still Has Other Lawsuits or Arbitration Matters Not Yet Disclosed

As of the date of disclosure of this announcement, the Company and its subsidiaries do not have other major lawsuits or arbitration matters that should be disclosed but have not been disclosed.

This announcement is hereby issued.

Board of Directors of Shanghai Industrial Development Co., Ltd.

April 4, 2026

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