Item
8.01 Other Events
SORL
AUTO PARTS, INC. (the “Company”) is filing this Current Report on Form 8-K with the Securities and Exchange Commission
(the “SEC”) to avail itself of an extension of time to file its Quarterly Report on Form 10-Q for the quarter ended
March 31, 2020 (the “Quarterly Report”), originally due on May 15, 2020. On March 4, 2020, the SEC issued an order
(Release No. 34-88318) under Section 36 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), granting
exemptions from specified provisions of the Exchange Act and certain rules thereunder. On March 25, 2020, the order was modified
and superseded by a new SEC order (Release No. 34-88465) (the “SEC Order”), that provides conditional relief to public
companies that are unable to timely comply with their filing obligations as a result of the outbreak and spread of the COVID-19
coronavirus pandemic (“COVID-19”).
The
Company is relying on the SEC Order to delay the filing of our Quarterly Report due to circumstances related to the COVID-19 pandemic.
Disruptions
and changes to our business caused by COVID-19 have required that we perform additional analyses relating to COVID-19’s
potential impact on our consolidated financial statements; moreover, the Company’s operations and business have experienced
disruptions due to the unprecedented conditions surrounding COVID-19, including shutdowns in China since January. These disruptions
include, but are not limited to, office and factory closures and communication issues between the Company and its professional
advisors due to suggested and mandated social quarantining and work from home orders. The disruptions in staffing, communications
and access to personnel have resulted in delays, limited support and insufficient review. The Company has also been delayed in
preparing the Quarterly Report due to delays in obtaining information from third parties who have similarly been unavailable and
impacted by COVID-19.
Considering
the impact of these factors, the Company will be unable to compile and review certain information required to file the Quarterly
Report by May 15, 2020 without unreasonable effort or expense. As such, the Company will be relying on the SEC Order and will
be making use of the 45-day grace period provided by the SEC Order to delay filing of its Quarterly Report. The Company presently
intends to file the Quarterly Report as soon as possible, but no later than June 29, 2020, which is 45 days from the Quarterly
Report’s original filing deadline of May 15, 2020.
In
addition, in light of ongoing developments related to COVID-19, we are supplementing the risk factors previously disclosed under
Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, with
the following risk factor:
The
COVID-19 pandemic has adversely affected the Company’s business, and the ultimate effect on the Company’s operations
and financial condition will depend on future developments, which are highly uncertain and cannot be predicted.
The
effects of the COVID-19 pandemic, including actions taken by businesses and governments, have adversely affected the global economy,
disrupted global supply chains and created significant volatility in the financial markets. As a result, there has been a significant
reduction in demand for and prices of auto parts. If the reduced demand for and price of auto parts continues for a prolonged
period, the Company’s business, financial condition, results of operation and liquidity may be materially and adversely
affected. Although the Company’s factories in the People’s Republic of China gradually returned to operations starting
in late February, the Company has not regained the level of production capacity before the pandemic. The Company’s operations
also may be adversely affected if significant portions of the Company’s workforce are unable to work effectively due to
illness, quarantines, government actions or other restrictions in connection with future waves of COVID-19 pandemic.
The
extent to which the COVID-19 pandemic adversely affects the Company’s business, financial condition, results of operation
and liquidity will depend on future developments, which are highly uncertain and cannot be predicted. These future developments
include, but are not limited to, the scope and duration of the COVID-19 pandemic and actions taken by governmental authorities
and other third parties in response to the pandemic. Disruptions and/or uncertainties related to the COVID-19 pandemic for a sustained
period of time could result in delays or modifications to the Company’s strategic plans and initiatives and hinder the Company’s
ability to achieve its strategic goals. The COVID-19 pandemic, and the volatile regional and global economic conditions stemming
from the pandemic, may also have the effect of heightening many of the other risks described in the “Risk Factors”
section included in the Company’s Annual Report on Form 10-K and in this Current Report on Form 8-K, as those risk factors
area mended or supplemented by subsequent Quarterly Reports on Form 10-Q and other reports and documents filed with the Securities
and Exchange Commission after the date of this Current Report on Form 8-K.
Forward
Looking Statements
Certain
of the statements contained in this report should be considered forward-looking statements within the meaning of the Securities
Act of 1933, as amended (the “Securities Act”), the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by words
such as “may,” “will,” “expect,” “intend,” “anticipate,” “believe,”
“estimate,” “plan,” “project,” “could,” “should,” “would,”
“continue,” “seek,” “target,” “guidance,” “outlook,” “if current
trends continue,” “optimistic,” “forecast” and other similar words. Such statements include, but
are not limited to, statements about the Company’s plans, objectives, expectations, intentions, estimates and strategies
for the future, and other statements that are not historical facts. These forward-looking statements are based on the Company’s
current objectives, beliefs and expectations, and they are subject to significant risks and uncertainties that may cause actual
results and financial position and timing of certain events to differ materially from the information in the forward looking statements.
There may be other factors of which the Company is not currently aware that may affect matters discussed in the forward-looking
statements and may also cause actual results to differ materially from those discussed. In particular, the consequences of the
coronavirus outbreak to economic conditions and the industry in general and the financial position and operating results of our
company in particular have been material, are changing rapidly, and cannot be predicted. The Company does not assume any obligation
to publicly update or supplement any forward-looking statement to reflect actual results, changes in assumptions or changes in
other factors affecting these forward-looking statements other than as required by law. Any forward looking statements speak only
as of the date hereof or as of the dates indicated in the statement.