Hongli Group Inc. (the "Company") (Nasdaq: HLP), a cold roll-formed steel profile manufacturer advancing its strategic transition into high-growth clean energy sectors, today provided an update on its discussions regarding a proposed strategic investment in Xell Energy, Inc.( "Xell Energy"), formerly known as Sidus Energy Storage, Inc., an innovator in advanced battery manufacturing and energy storage solutions.

As previously announced, the Company entered into a non-binding Memorandum of Understanding with Xell Energy in June 2026 to explore a potential strategic manufacturing collaboration. Building on those discussions, the Company is negotiating with existing stockholders of Xell Energy regarding a definitive share purchase agreement for the proposed acquisition of an aggregate 20% equity interest in Xell Energy. If completed on the terms currently contemplated, the transaction would result in the Company becoming a 20% stockholder of Xell Energy.

While negotiations are progressing constructively toward the execution of definitive transaction documents, the proposed acquisition remains subject to the finalization and execution of a definitive agreement, customary closing conditions, board approvals, and regulatory clearances. There can be no assurance that a definitive agreement will be entered into or that the proposed transaction will be consummated on the terms currently contemplated, or at all.

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