Fuwei Films Announces Termination of Securities Purchase Agreement
Fuwei Films (Nasdaq: FFHL) announced the termination of its Securities Purchase Agreement with Enesoon New Energy Limited, effective May 22, 2022. The decision impacts the investment framework of Fuwei Films, a manufacturer of BOPET plastic films in China. The company's films serve multiple industries, including packaging and electronics. Fuwei Films continues to navigate risks such as oversupply in the BOPET market, trade barriers, and potential delisting under the Holding Foreign Company Accountable Act.
- None.
- Termination of the Securities Purchase Agreement could limit growth opportunities.
- Significant oversupply in the BOPET market may pressure pricing and margins.
- Potential delisting under the Holding Foreign Company Accountable Act poses a risk to shareholders.
- Uncertainty due to trade barriers and the U.S.-China trade war could affect operations.
- Volatility in raw material prices may impact manufacturing costs.
BEIJING, May 27, 2022 /PRNewswire/ -- Fuwei Films (Holdings) Co., Ltd. (Nasdaq: FFHL) ("Fuwei Films" or the "Company"), a manufacturer and distributor of high-quality BOPET plastic films in China, today announced that the Company has delivered a notice of termination (the "Termination Notice"), dated as of May 22, 2022, to Enesoon New Energy Limited, a British Virgin Islands company ("Enesoon"), pursuant to which, the Company notified Enesoon and the current shareholders of Enesoon (the "Sellers") that the Company is terminating the Securities Purchase Agreement, dated as of March 31, 2021, as amended on July 31, 2021 (collectively, the "Agreement"), by and among the Company, Enesoon, the Sellers and Enesoon New Energy (Shen Zhen) Co., Ltd., with immediate effect in accordance with the provisions of the Agreement.
About Fuwei Films
Fuwei Films conducts its business through its wholly-owned subsidiary, Fuwei Films (Shandong) Co., Ltd. ("Shandong Fuwei"). Shandong Fuwei develops, manufactures and distributes high-quality plastic films using the biaxial oriented stretch technique, otherwise known as BOPET film (biaxially oriented polyethylene terephthalate). Fuwei's BOPET film is widely used for packaging food, medicine, cosmetics, tobacco, and alcohol, as well as in the imaging, electronics, and magnetic products industries.
Safe Harbor
This press release contains information that constitutes forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and are subject to risks. Risk factors that could contribute to such differences include those matters more fully disclosed in the Company's reports filed with the U.S. Securities and Exchange Commission which, among other things, include the significant oversupply of BOPET films resulting from the rapid growth of the Chinese BOPET industry capacity, changes in the international market and trade barriers, especially the uncertainty of the antidumping investigation and imposition of an anti-dumping duty on imports of the BOPET films originating from the People's Republic of China ("China") conducted by certain countries; uncertainty around coronavirus (COVID-19) outbreak and the effects of government and other measures seeking to contain its spread, potential delisting of our ordinary shares under the Holding Foreign Company Affordable Act if the US Public Company Accounting Oversight Board is unable to inspect our auditors located in China, uncertainty around U.S.-China trade war and its effect on the Company's operation, fluctuations of the RMB exchange rate, and our ability to obtain adequate financing for our planned capital expenditure requirements; uncertainty as to our ability to continuously develop new BOPET film products and keep up with changes in BOPET film technology; risks associated with possible defects and errors in our products; uncertainty as to our ability to protect and enforce our intellectual property rights; uncertainty as to our ability to attract and retain qualified executives and personnel; and uncertainty in acquiring raw materials on time and on acceptable terms, particularly in view of the volatility in the prices of petroleum products in recent years. The forward-looking information provided herein represents the Company's estimates as of the date of the press release, and subsequent events and developments may cause the Company's estimates to change. The Company specifically disclaims any obligation to update the forward-looking information in the future. Therefore, this forward-looking information should not be relied upon as representing the Company's estimates of its future financial performance as of any date subsequent to the date of this press release. Actual results of our operations may differ materially from information contained in the forward-looking statements as a result of the risk factors.
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SOURCE Fuwei Films
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