BEIJING, Jan. 28, 2019
/PRNewswire/ -- Fuwei Films (Holdings) Co., Ltd. (Nasdaq: FFHL)
("Fuwei Films"), currently a manufacturer and distributor of
high-quality BOPET plastic films in China, today announced that the Company has
entered into a Securities Purchase Agreement with Gold Glory
Blockchain Inc. ("Gold Glory"), a California-headquartered company focused on
blockchain technology applications and digital asset services. The
Agreement will result in the issuance by the Company of 9,500,000
new ordinary shares in exchange for all outstanding shares of Gold
Glory.
Fuwei Films concurrently entered into a Share Transfer Agreement
with Hong Kong Ruishang International Trade Co. Ltd. ("Ruishang"),
the current majority owner of FFHL's equity shares. Pursuant to
this Agreement, FFHL agrees to sell, assign and deliver all shares
of Fuwei Films (BVI) Co. Ltd. ("Fuwei BVI"), a subsidiary directly
owned by Fuwei Films plus cash consideration of USD3 million to Ruishang, in exchange for all
1,728,126 ordinary shares of Fuwei Films owned by Ruishang,
representing 52.9% of the total Fuwei Films outstanding shares.
This transaction will effectively transfer the existing business of
Fuwei Films to Ruishang, after which Fuwei Films will only own the
shares of Gold Glory.
Mr. Zengyong Wang, Chairman and CEO of Fuwei Films, said, "We
are excited to have reached agreements with Gold Glory and
Ruishang, because we believe the transactions, once closed, are in
the best interests of our shareholders. Our company will enter into
a brand new industry with much more growth potential."
The closing of Securities Purchase transaction is subject to the
following conditions, (i) concurrent divesture of Fuwei Films
current business, which is to be effected through sale of Fuwei BVI
to Ruishang, pursuant to the Share Transfer Agreement (ii) approval
of the transactions contemplated by the Securities Purchase
Agreement and the Share Transfer Agreement by the Board and
shareholders of Fuwei Films; (iii) Receipt of necessary regulatory
approvals, including NASDAQ approval, and (iv) a private placement
of ordinary shares by Gold Glory raising at least USD10 million.
About Gold Glory
Gold Glory (www.goldglorybc.com) is a leading edge blockchain
fintech company providing research, development, application and
consultancy services for enterprises developing blockchain
technology based projects. Gold Glory operates a digital assets
exchange called PRDAE (Pacific Rim Digital Asset Exchange), or
PRDAE.PRO, which has over 150,000 registered traders. PRDAE
provides registration, clearing, settlement, risk control
integration and highly secure transactions.
Gold Glory also offers asset digitization services to help
sponsors looking to create a cryptocurrency tied to one or more
assets. The company provides a zero-cost test mechanism for smart
contracts. The modular design allows configurable encryption
algorithms and alternative formula modules to be combined in any
combination, providing a flexible response to changes that may
occur, and reducing transaction congestion as much as possible. Its
technology allows processing of over 1.4 million transactions per
second, which permits real time clearing, brokerage commissions and
distributions.
Gold Glory's R&D focuses on the application and promotion of
blockchain technology, and the implementation of digital asset in
the real estate industry. This includes the digitalization of land
ownership titles and safekeeping of real estate data that is shared
and transmitted on the blockchain network, while ensuring the
openness, uniqueness and security of the data. With applicable
Alternative Trading System permits, Gold Glory has the potential to
provide real estate asset-backed digital trading and circulation
services.
M&T Global Partners Ltd. is acting as the advisor to Gold
Glory in these transactions.
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 to package 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 significant
competition in the BOPET film industry, especially 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 adverse impact 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 main importing
countries; fluctuations of RMB exchange rate, the reduce in demand
for the Company's products or the loss of main customers which may
result in the decrease of sales, and negatively influencing the
Company's financial performance, uncertainty as to the future
profitability, uncertainty as to the Company's ability to
successfully obtain additional funds to meet the working capital
needs of the new BOPET production line, uncertainty as to the
Company's ability to continuously develop new BOPET film products
to be produced by the third production line and keep up with
changes in BOPET film technology, risks associated with possible
defects and errors in its products including complaints and claims
from clients, uncertainty as to its ability to protect and enforce
its intellectual property rights, uncertainty as to its ability to
attract and retain qualified executives and personnel, and
uncertainty in acquiring raw materials on time and on acceptable
terms, particularly in light of the volatility in the prices of
petroleum products in recent years, instability of power and energy
supply, and the uncertainty regarding the future operation of the
Company in connection with the changes in the labor law in
China, the measures taken by the
Chinese government to save energy and reduce emissions, and the
complaints from nearby residents and local government about the
noise caused by our production as well as the uncertainty of the
impact of major shareholder transfer that have substantial
influence over the Company and the Company's business operation
including possible overlap of our BOPET products, customers and
market orientation with an BOPET film manufacturer, which is
controlled by the same individual who has control over the shares
of our major shareholder. 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.
For more information, please contact:
In China:
Xiaoli Yu
Investor Relations Officer
Phone: +86-133-615-59266
Email: fuweiIR@fuweifilms.com
In the U.S.:
Shiwei Yin
Investor Relations
Grayling
Phone: +1-646-284-9474
Email: shiwei.yin@grayling.com
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SOURCE Fuwei Films (Holdings) Co., Ltd.