Zhejiang Youfu High-Tech Fiber Co., Ltd.
Announcement on Progress of Litigation Matters
The Company and the Board of Directors guarantee the truthfulness, accuracy, and completeness of the information disclosed herein, and that there are no false records, misleading statements, or material omissions.
Zhejiang Youfu High-Tech Fiber Co., Ltd. (hereinafter referred to as the "Company" or "Youfu Shares" or "the Defendant") held its 13th meeting of the 6th Board of Directors on July 8, 2026, and deliberated and approved the "Proposal on the Settlement of the Litigation Case of Huzhou Nanxun Taihe Paper Co., Ltd., a Holding Subsidiary." The specific situation is hereby announced as follows:
I. Basic Situation of the Litigation
Mr. Yin (hereinafter referred to as the "Plaintiff") and the Defendant are both shareholders of the Company's holding subsidiary, Huzhou Nanxun Taihe Paper Co., Ltd. (hereinafter referred to as "Taihe Paper"). The Plaintiff holds a 30% stake in Taihe Paper, and the Defendant holds a 70% stake. In 2024, the Plaintiff applied to the Huzhou Nanxun District People's Court for shareholder information rights. According to the 2023 annual audit report of Taihe Paper and the sales data obtained from the execution inspection, audited by the accounting firm, it was shown that Youfu Shares, as the controlling shareholder of Taihe Paper, sold all of Taihe Paper's products to itself and its wholly-owned subsidiary in 2023. The accounting revealed that this internal transaction's total sales price was RMB 35,284,545.34 lower than the market sales price, causing Taihe Paper to incur losses. To protect the rights and interests of Taihe Paper and other shareholders, a lawsuit was filed with the Huzhou Nanxun District People's Court.
During the litigation process, the Plaintiff submitted the following litigation requests (as amended) to the Huzhou Nanxun District People's Court: