¨
|
REGISTRATION STATEMENT PURSUANT
TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
|
x
|
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
¨
|
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
¨
|
SHELL
COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
|
Title
of each class
|
Name
of each exchange on which registered
|
Ordinary
Shares
|
NASDAQ
Global Market
|
U.S.
GAAP
|
x
|
International
Financial Reporting Standards as issued by
the
International Accounting Standards Board
|
¨
|
Other
|
o
|
|
·
|
our
goals and strategies;
|
|
·
|
our
future business development, results of operations and financial
condition;
|
|
·
|
our
ability to protect our intellectual property rights;
|
|
·
|
expected
growth of and changes in the PRC BOPET film industry and in the demand for
BOPET film products;
|
|
·
|
projected
revenues, profits, earnings and other estimated financial information;
|
|
·
|
our
ability to maintain and strengthen our position as a leading provider of
BOPET film products in China;
|
|
·
|
our
ability to maintain strong relationships with our customers and suppliers;
|
|
·
|
our
planned use of proceeds;
|
|
·
|
effect
of competition in China and demand for and price of our products and
services; and
|
|
·
|
PRC
governmental policies regarding our industry.
|
|
·
|
adverse
effect on our business caused by the global financial crisis;
|
|
·
|
competition
in the BOPET film industry;
|
|
·
|
growth
of, and risks inherent in, the BOPET film industry in China;
|
|
·
|
uncertainty
as to future profitability and our ability to obtain adequate financing
for our planned capital expenditure requirements;
|
|
·
|
uncertainty
in our ability as to obtain additional funding in order to complete the
construction of the new production line (thick film) project and begin
production;
|
|
·
|
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;
|
|
·
|
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;
|
|
·
|
adverse
effect on our business caused by adjustment of economic structure
regulations of the Chinese government; and
|
|
·
|
adverse
effect on our business caused by extreme climate changes.
|
|
·
|
“Fuwei”,
“Company”, “us” or “we” refer to Fuwei Films (Holding) Co., Ltd. The term
“you” refers to holders of our ordinary shares.
|
|
·
|
“China”
or “PRC” and the “Chinese government” refer to the People’s Republic of
China and its government.
|
|
·
|
All
references to “Renminbi,” or “RMB” are to the legal currency of China, all
references to “U.S. dollars,” “dollars,” “$” or “US$” are to the legal
currency of the United States and all references to “Hong Kong dollars” or
“HK$” are to the legal currency of Hong Kong. Any discrepancies in any
table between totals and sums of the amounts listed are due to rounding.
|
|
·
|
“BOPET”
refers to the Biaxially Oriented Polyester Film.
|
Average
|
High
|
Low
|
Period-end
|
|||||||||||||
(Rmb per U.S.$1.00)
|
||||||||||||||||
2005
(1)
|
8.1472 | 8.2765 | 8.0702 | 8.0709 | ||||||||||||
2006
(1)
|
7.9723 | 8.0702 | 7.8041 | 7.8041 | ||||||||||||
2007
(1)
|
7.6038 | 7.7881 | 7.2946 | 7.2946 | ||||||||||||
2008
(1)
|
6.9623 | 7.2941 | 6.7480 | 6.8542 | ||||||||||||
2009
(1)
|
6.8311 | 6.8368 | 6.8242 | 6.8270 | ||||||||||||
September
2009
(2)
|
6.8283 | 6.8310 | 6.8258 | 6.8263 | ||||||||||||
October
2009
(2)
|
6.8270 | 6.8296 | 6.8234 | 6.88275 | ||||||||||||
November
2009
(2)
|
6.8274 | 6.8301 | 6.8259 | 6.8271 | ||||||||||||
December
2009
(2)
|
6.8278 | 6.8300 | 6.8253 | 6.8253 | ||||||||||||
January
2010
(2)
|
6.8271 | 6.8277 | 6.8264 | 6.8268 | ||||||||||||
February
2010
(2)
|
6.8265 | 6.8346 | 6.8260 | 6.8260 | ||||||||||||
March
2010
(2) (3)
|
6.8263 | 6.8271 | 6.8255 | 6.8259 |
(1)
|
Annual averages are calculated by
averaging the rates on the last business day of each month during the
relevant period.
|
(2)
|
Monthly average is calculated by
averaging the daily rates during the relevant period.
|
(3)
|
As
of
April
20
,
2010
, t
he
exchange rate was 6.8253
.
|
Year Ended
December 31,
|
||||||||||||||||||||||||
2005
|
2006
|
2007
|
2008
|
2009
|
||||||||||||||||||||
(in
thousands, except per share data)
|
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
US$
|
||||||||||||||||||
Statement
of Operations Data:
|
||||||||||||||||||||||||
Revenues
|
346,205 | 436,884 | 449,373 | 447,255 | 320,731 | 46,980 | ||||||||||||||||||
Gross
profit
|
87,115 | 102,543 | 99,842 | 70,332 | 24,612 | 3,605 | ||||||||||||||||||
Operating
income
|
65,999 | 78,017 | 64,266 | 24,604 | (16,547 | ) | (2,424 | ) | ||||||||||||||||
Interest
expense
|
(13,747 | ) | (12,884 | ) | (13,233 | ) | (3,995 | ) | (6,540 | ) | (958 | ) | ||||||||||||
Income
before income taxes
|
57,069 | 68,422 | 51,941 | 21,124 | (23,024 | ) | (3,373 | ) | ||||||||||||||||
Net
income/(loss)
|
57,128 | 67,665 | 47,260 | 18,157 | (18,963 | ) | (2,776 | ) | ||||||||||||||||
Earnings
per share
|
||||||||||||||||||||||||
Basic
|
74,096 | 61.46 | 3.62 | 1.39 | (1.45 | ) | (0.21 | ) | ||||||||||||||||
Diluted
|
74,096 | 61.37 | 3.62 | 1.39 | (1.45 | ) | (0.21 | ) | ||||||||||||||||
Weighted
average number ordinary shares, Basic and diluted
|
||||||||||||||||||||||||
Basic
|
771 | 1,101,031 | 13,062,500 | 13,062,500 | 13,062,500 | 13,062,500 | ||||||||||||||||||
Diluted
|
771 | 1,102,488 | 13,062,500 | 13,062,500 | 13,062,500 | 13,062,500 |
As of
December 31,
|
||||||||||||||||||||||||
2005
|
2006
|
2007
|
2008
|
2009
|
||||||||||||||||||||
(in
thousands)
|
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
US$
|
||||||||||||||||||
Balance
Sheet Data:
|
||||||||||||||||||||||||
Cash
|
7,427 | 249,939 | 30,909 | 15,823 | 26,804 | 3,926 | ||||||||||||||||||
Accounts
receivable, net
|
46,129 | 75,530 | 58,195 | 38,579 | 28,785 | 4,216 | ||||||||||||||||||
Inventories
|
24,887 | 23,783 | 41,670 | 30,589 | 45,039 | 6,597 | ||||||||||||||||||
Total
current assets
|
93,349 | 372,001 | 211,842 | 104,562 | 119,282 | 17,470 | ||||||||||||||||||
Property,
plant and equipment, net
|
303,596 | 317,690 | 493,562 | 578,643 | 555,718 | 81,400 | ||||||||||||||||||
Total
assets
|
440,361 | 738,082 | 738,975 | 739,904 | 735,509 | 107,733 | ||||||||||||||||||
Short-term
bank loans
|
248,046 | 239,678 | 188,027 | 164,764 | 153,179 | 22,435 | ||||||||||||||||||
Total
current liabilities
|
367,401 | 272,175 | 226,445 | 204,305 | 198,666 | 29,099 | ||||||||||||||||||
Total
shareholders’ equity
|
72,960 | 465,907 | 512,530 | 530,599 | 511,567 | 74,932 |
|
·
|
departure
of any of our management members or employees in possession of our
confidential proprietary information;
|
|
·
|
breach
by such departing management member or employee of his or her
confidentiality and non-disclosure undertaking to us;
|
|
·
|
expiration
of the protection period of our registered patents or trademarks;
|
|
·
|
infringement
by others of our proprietary technology and intellectual property rights;
or
|
|
·
|
refusal
by relevant regulatory authorities to approve our patent or trademark
applications.
|
|
·
|
limit
our ability to pay dividends or require us to seek consents for the
payment of dividends;
|
|
·
|
increase
our vulnerability to general adverse economic and industry conditions;
|
|
·
|
limit
our ability to pursue our growth plan;
|
|
·
|
require
us to dedicate a substantial portion of our cash flow from operations as
payment for our debt, thereby reducing availability of our cash flow to
fund capital expenditures, working capital and other general corporate
purposes;
|
|
·
|
limit
our flexibility in planning for, or reacting to, changes in our business
and our industry; and/or
|
|
·
|
We
cannot assure you that we will be able to obtain the additional financing
on terms that are acceptable to us, if at all.
|
|
·
|
Printing
base film used in printing and lamination;
|
|
·
|
Stamping
foil base film and transfer base fims used for packaging of luxury items
of cigarettes and alcohol to increase the aesthetic presentation of the
item and improving environmental performance;
|
|
·
|
Metallization
film or aluminum plating base film used for vacuum aluminum plating for
paper or flexible plastic lamination;
|
|
·
|
High-gloss
film used for aesthetically enhanced packaging purposes;
|
|
·
|
Heat-sealable
film and Transfer base film used for construction, printing and
making heat sealable bags;
|
|
·
|
Laser
holographic base film used as anti-counterfeit film for food, medicine,
cosmetics, cigarettes and alcohol packaging; and
|
|
·
|
Dry
film generally used in circuit boards (PCB & FPC) production, and
sometimes used for nameplate and crafts etching. It is not only the most
widely used mask film for PCB graphic but also indispensable image
material for manufacturing excessive circuit.
|
Date
|
Award/Certificate
|
Issuing Authority
|
||
September
2004
(1)
|
ISO
9001:2000 Certificate
|
China
Certification Center for Quality Mark
|
||
June
2009
(2)
|
ISO
14001 Certificate
|
SGS
|
||
December
2007
(3)
|
Key
High-Tech Enterprise of the National Torch Program
|
Ministry
of Science and Technology
|
||
July
2008
(4)
|
Designated
as an A-Category taxpayer by the National Taxation Bureau and the Local
Taxation Bureau of Shandong Province.
|
the
National Taxation Bureau and
the
Local Taxation Bureau of Shandong Province
|
||
December
2008
(5)
|
Redesignated
as a High-and-New Tech Enterprise by Shandong Department of Science and
Technology, National and Local Taxation Bureau of Shandong Province, as
well as from the Shandong Province Financial Bureau
|
Shandong
Department of Science and Technology, National and Local Taxation Bureau
of Shandong Province, and Shandong Province Financial Bureau
|
||
May
2009
|
Designated
as “Advanced Enterprise of Chinese plastic industry”
|
China
Plastic and Packaging Assositaion
|
||
Technological
Innovation Award
|
||||
August
2009
|
||||
Mr.Lee
was awarded as “Leader of Technological Innovation in Shandong Province”
|
Shandong
Province enterprise technological innovation promotion association
|
(1)
|
ISO
9000 certification has become an international reference for quality
management requirements in business-to-business dealings. This
certification enables us to compete on many more markets around the world
and provides our customers with assurances about our quality, safety and
reliability.
|
(2)
|
After
strict examination and approval by China Environment United (Beijing)
Certification Center Co., Ltd (Environment Conformity Assessment Center of
State Environment Protection Bureau), Fuwei Films (Shandong) Co., Ltd. has
successfully passed the ISO14001 Environmental Administration System in
July 2006, and passed the review by SGS in June 2009.
|
(3)
|
Fuwei
Shandong was awarded as Key High-Tech Enterprise of the National Torch
Program in December 2007.
|
(4)
|
The
A-Category is the top of the four ratings for corporate taxpayers in
China. Candidates eligible for the category are reviewed and designated by
the authorities every two years.
|
(5)
|
Because
of China’s new Enterprise Income Tax Law which became effective on January
1, 2008, the status Fuwei Shandong as an HNTE had to be renewed. On
December 2008, Fuwei Shandong was re-designated High-and-New Tech
Enterprises by Shandong Department of Science and Technology, National and
Local Taxation Bureau of Shandong Province, as well as from the Shandong
Province Financial Bureau.
|
|
·
|
Continue
d
construction of the new BOPET
produ
ction line
|
|
·
|
Expansion into overseas markets
and promotion of our products in the PRC
|
|
·
|
Investment in research and
development
|
Category
|
2007
|
2008
|
2009
|
|||||||||
Printing
film
|
18.6 | % |
12.6
|
% |
11.0
|
% | ||||||
Stamping
foil film
|
21.0 | % | 31.2 | % | 54.4 | % | ||||||
Metallization
film
|
6.8 | % | 10.1 | % | 10.9 | % | ||||||
Special
film
|
37.8 | % | 24.0 | % | 10.6 | % | ||||||
Base
film for other applications
|
15.8 | % | 22.0 | % | 13.1 | % |
|
·
|
High-gloss
film: Film with high levels of reflection approaching a mirror-like
surface, used for aesthetically-enhanced packaging purposes.
|
|
·
|
Heat-sealable
film: Film with a three layer structure. The heat-sealable film is
primarily sold for use in construction, printing and making heat
sealable bags.
|
|
·
|
Laser
holographic base film: A directly embossable film with high transparency,
used as anti-counterfeit film and for aesthetics for food, medicine,
cosmetics, cigarette and alcoholic packaging.
|
|
·
|
Dry
film: Generally used in circuit boards (PCB & FPC) production,
and sometimes used for nameplate and crafts etching. It is not only the
most widely used mask film for PCB graphic but also indispensable image
material for manufacturing excessive circuit.
|
Production Line
|
Designed Production Capacity
|
Estimated Remaining Life Span
|
||
Brückner
Production Line
|
13,000
metric tons per annum
|
Approximately
9 years
|
||
DMT
Production Line
|
16,100
metric tons per annum
|
Approximately
16 years
|
||
Trial
Production Line
|
1,500
metric tons per annum
|
Approximately
10 years
|
Approximate
Annual
Production
Volume
(tons)
|
Average
Annual
Uti
lization
Rate
(%)
|
|||||||||||||||||||||||
Production Line
|
2007
|
2008
|
2009
|
2007
|
2008
|
2009
|
||||||||||||||||||
Brückner
Production Line
|
12,299 | 12,092 | 11,823 | 94.6 | % | 93.0 | % | 90.9 | % | |||||||||||||||
DMT
Production Line
|
12,378 | 13,769 | 13,822 | 76.9 | % | 85.5 | % | 85.8 | % |
Product
|
Achievement
|
|
Laser
holographic base film
|
Our
laser holographic base film is a directly embossable BOPET film, ideal for
holographic applications. This film eliminates the need to coat and
prepare substrates for holographic embossing, thus reducing costs for our
customers. It can be used for anti-counterfeit purposes and in packaging
to help enhance the aesthetic perception of food, medicine, cosmetics,
cigarettes and alcohol.
|
|
Single/double
surface matte film
|
Our
matte film is mainly used for aesthetically-enhanced packaging purposes.
Our ability to produce single-sided matte films offers significant cost
savings for our customers as the non-matte side of the film may be used
for other applications without further processing.
|
|
Anti-counterfeit
film
|
Our
anti-counterfeit film changes color under ultraviolet rays. Accordingly,
it is used for packaging branded products for anti-counterfeit purposes.
|
|
Chemical
pretreated film
|
Our
film is pretreated in-line and coated, which results in a strong adhesion
to ink and aluminum.
|
|
Heat-sealable
film
|
Heat-sealable
film is a three layers co-extruded Biaxially oriented polyester film with
an amorphous polyester heat seal layer. Available with corona treatment on
the non-seal side to give improved adhesion to typical packaging inks and
metallizing. It not only can provide permanent seals to PET, but also can
seals to APET, CPET, PETG and others. Heat-sealable film can be
aluminized, printed and composite with other films. It is microwave
ovenable film for packaging refrigerated and frozen foods.
|
|
Heat
sealable film for steel
|
To
improve the heat-sealable strength between the film and steel and adjust
the stretchable capability so as to be more suitable for steel’s heat
sealing. Mainly used for protection and decoration of colorful armor plate
for home appliances.
|
|
High-gloss
film
|
By
using special raw chips and process, provides very high gloss, uniform
thickness, good mechanical properties, and surface smoothness. It can be
used under -70~200°C for packaging food, cigarettes, alcohol and laser
embossing, holographic anti-fake and metallic yarn and others.
|
|
White
film
|
To
be used for print, composite, coating and others, such as advertising lamp
house, release film and reflector film.
|
|
DFR
base film
|
Generally
used in circuit boards (PCB & FPC) production, sometimes used for
nameplate and crafts etching. This is not only the most widely used mask
film for PCB graphic, but also an indispensable image material for
manufacturing excessive circuit.
|
|
Hot
shrink film
|
|
To
change the hot shrinkage rate by enlarging the draw ratio. It
is mainly used for PET beverage bottle shrinkable tags. Hot shrink film
uses PET structure which is the substitute of PVC shrinkable tags, which
is also in line with the requirements of environmental protection and
recyclable.
|
Product
|
Objectives
and Applications
|
Commercialization Date
Expected
|
||
Metal-adhesion
improved film
|
To
improve the peel strength after be metalized sealing. Mainly used for
liquid packages.
|
July
2010
|
||
Window
film
|
To
be used in automobile window application and building window
|
September
2010
|
||
Positioning
Transfer base film
|
|
For
high value-added packaging, such as tobacco and alcohol, increasing the
apparence of the products
|
|
December
2010
|
Year
Ended
Dec. 31,
2007
|
Year
Ended
Dec. 31,
2008
|
Year
Ended
Dec. 31,
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Research
and Development Expenses
|
1,596 |
(1)
|
2,631 |
(2)
|
1,264 |
(3)
|
185 |
Percentage of Total Revenue (%)
|
||||||||||||
2007
|
2008
|
2009
|
||||||||||
Dongguan
Klaser Technologies Co.,Ltd.
|
0.9 | 4.9 | 7.2 | |||||||||
Jiangyin
Teruida Packaging Technology Co.,Ltd.
|
2.3 | 2.5 | 5.1 | |||||||||
Dare
Technical Co., Ltd. Danyang Advance Packaging Material Subsidiary Company
|
3.1 | 3.4 | 5.0 | |||||||||
Southeast
Films Technology Co.,Ltd.
|
0.8 | 1.8 | 3.9 | |||||||||
Holotek
Technology Co., Ltd.
|
0.9 | 2.7 | 2.9 |
|
·
|
we
regularly attend trade fairs and exhibitions as we believe that they serve
as a good platform for us to exhibit our new products and expand our sales
network. In addition, participation in seminars, fairs and exhibitions
provides us with opportunities to network with our potential and existing
customers and allows us to obtain up-to-date information on new products,
market trends and consumer demand;
|
|
·
|
referrals
from existing customers as well as business associates to generate sales
opportunities; and
|
|
·
|
promotion
through our corporate website. Information on our products and services
are also found on our corporate website which allows us to reach out to
potential domestic and overseas customers.
|
|
·
|
the
consistency of the quality of raw materials supplied and any relevant
certifications;
|
|
·
|
our
inspection of the supplier’s quality control system;
|
|
·
|
positive
feedback from the supplier’s other customers;
|
|
·
|
pricing
of raw materials;
|
|
·
|
timely
delivery of raw materials;
|
|
·
|
the
supplier’s financial position and viability;
|
|
·
|
the
service provided by the supplier;
|
|
·
|
qualifying
suppliers by sample testing and batch purchasing of their raw materials;
and
|
|
·
|
annual
evaluation and review of our suppliers.
|
Percentage
of total purchases (%)
|
||||||||||||||
Supply
|
2007
|
2008
|
2009
|
|||||||||||
Sinopec
Yizheng Chemical Fibre Company Limited
|
PET
resin and Additives
|
46.4 | 44.8 | 45.8 | ||||||||||
Jiangyin
Huaxing Hecheng Co., Ltd.
|
PET
resin
|
12.3 | 9.7 | 12.5 |
Percentage
of Total Purchases (%)
|
|||||||||||||
Raw
Material
|
2007
|
2008
|
2009
|
Country
|
|||||||||
PET
resin
|
78.0 | 77.2 | 76.0 |
PRC
and Korea
|
|||||||||
Additives
|
22.1 | 22.8 | 24.0 |
PRC
|
Features
|
BOPP
|
BOPET
|
BOPA
|
|||
Water
vapor barrie
|
Excellent
|
Fair
|
Poor
|
|||
Gas
barrier properties
|
Poor
|
Excellent
|
Excellent
|
|||
Break
down voltage
|
Poor
|
Excellent
|
Excellent
|
|||
Machine-ability
|
Fair
|
Excellent
|
Excellent
|
|||
Print-ability
|
Fair
|
Excellent
|
Fair
|
|||
Suitability
for Metallizing
|
Poor
|
Excellent
|
Fair
|
|||
Density
(gm/cc)
|
Low
(0.91)
|
High
(1.39)
|
Medium
(1.15)
|
|||
Tensile
strength
|
|
Poor
|
|
Excellent
|
|
Excellent
|
(1)
|
This
comparison is based on the book of Biaxially Oriented Plastics Film,
edited by Yanping Yin and published by China Chemical Press in August
1999.
The Company did not notice updated technical specifications
subsequently as of December 31, 2009.
|
|
·
|
research
and development capability;
|
|
·
|
quality
and reliability of products;
|
|
·
|
technical/manufacturing
capability;
|
|
·
|
industrial
reputation; and
|
|
·
|
production
cost and sale prices.
|
|
·
|
Dupont
Hongji Films Foshan Co., Ltd;
|
|
·
|
Yihua
Toray Polyester Film Co., Ltd.; and
|
|
·
|
Ningbo
Shunsu Film Co., Ltd.
|
Name
|
Country
of Incorporation
|
Ownerships
Interests
|
Direct
Parent
|
|||
Fuwei
Films (Shandong) Co., Ltd.
|
Weifang
Shandong, China
|
100%
wholly owned by Direct Parent
|
Fuwei
Films (BVI) Co. Ltd.
|
|||
Fuwei
Films (BVI) Co., Ltd.
|
British
Virgin Islands,UK
|
100%
wholly owned by Direct Parent
|
Fuwei
Films (Holdings) Co. Ltd.
|
|||
Fuwei
Films USA LLC
|
|
South
Carolina, USA
|
|
60%
owned by Direct Parent (1)
|
|
Fuwei
Films (Holdings) Co. Ltd.
|
Year
Ended
Dec.
31, 2007
|
Year
Ended
Dec.
31, 2008
|
Year
Ended
Dec.
31, 2009
|
||||||||||
Materials
costs
|
80.9 | % | 78.6 | % | 73.3 | % | ||||||
Energy
expense
|
6.9
|
% | 8.2 | % | 9.0 | % | ||||||
Factory
overhead
|
8.6 | % | 9.0 | % | 13.1 | % | ||||||
Packaging
materials
|
2.7 | % | 2.9 | % | 3.0 | % | ||||||
Direct
labor
|
0.9 | % | 1.3 | % | 1.6 | % |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Balance
at beginning of year
|
872 | 2,644 | 4,074 | 597 | ||||||||||||
Bad
debt (recovery) / expense
|
1,772 | 1,430 | (1,713 | ) |
(
251
|
) | ||||||||||
Write-offs
|
- | - |
(
102
|
) |
(
15
|
) | ||||||||||
Balance
at end of year
|
2,644 | 4,074 | 2,259 | 331 |
Year
Ended Dec.
31, 2007
|
Year
Ended Dec.
31, 2008
|
Year
Ended Dec.
31, 2009
|
||||||||||
(%
of Total Revenue)
|
||||||||||||
Gross
Profit
|
22.2 | 15.7 | 7.7 | |||||||||
Operating
expenses
|
(7.9 | ) | (10.2 | ) | (12.8 | ) | ||||||
Other
expense
|
(2.7 | ) | (0.8 | ) | (2.0 | ) | ||||||
Income
tax benefit
|
(1.0 | ) | (0.7 | ) | 1.3 | |||||||
Net
income/ (loss)
|
10.6 | 4.1 | (5.9 | ) |
December 31, 2009
|
December 31, 2008
|
|||||||||||||||||||
RMB
|
US$
|
% of Total
|
RMB
|
% of Total
|
||||||||||||||||
Printing
film
|
35231 | 5,161 | 11.0 | % | 56,607 | 12.7 | % | |||||||||||||
Stamping
film
|
174,356 | 25,539 | 54.4 | % | 139,571 | 31.2 | % | |||||||||||||
Metallization
film
|
35,138 | 5,147 | 10.9 | % | 45,148 | 10.1 | % | |||||||||||||
Specialty
film
|
34,004 | 4,981 | 10.6 | % | 107,404 | 24.0 | % | |||||||||||||
Base
film for other applications
|
42,002 | 6,152 | 13.1 | % | 98,526 | 22.0 | % | |||||||||||||
Total
|
320,731 | 46,980 | 100.0 | % | 447,255 | 100 | % |
December
31, 2007
|
December
31, 2008
|
|||||||||||||||
(RMB in thousands)
|
% of Total
|
(RMB in thousands)
|
% of Total
|
|||||||||||||
Printing
film
|
83,453
|
18.6
|
56,607
|
12.7
|
||||||||||||
Stamping
film
|
94,366
|
21
|
139,571
|
31.2
|
||||||||||||
Metallization
film
|
30,668
|
6.8
|
45,148
|
10.1
|
||||||||||||
Special
film
|
169,961
|
37.8
|
107,404
|
24.0
|
||||||||||||
Base
film for other applications
|
70,925
|
15.8
|
98,526
|
22.0
|
||||||||||||
449,373
|
100
|
447,255
|
100
|
Year
Ended December 31,
2007
|
Year
Ended December 31,
2008
|
Year
Ended December 31,
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Net
cash generated from operating activities
|
82,856 | 80,027 | 9,929 | 1,453 | ||||||||||||
Net
cash used in investing activities
|
(246,787 | ) | (76,750 | ) | (7,599 | ) | (1,112 | ) | ||||||||
Net
cash (used in)/generated from financing activities
|
(51,651 | ) | (18,262 | ) | 8,415 | 1,233 | ||||||||||
Effect
of foreign exchange rate change
|
(3,448 | ) | (104 | ) | 236 | 44 | ||||||||||
Net
increase/(decrease) in cash and cash equivalents
|
(219,030 | ) | (15,086 | ) | 10,981 | 1,618 | ||||||||||
Cash
as at the beginning of the year
|
249,939 | 30,909 | 15,823 | 2,308 | ||||||||||||
Cash
as at the end of the year
|
30,909 | 15,823 | 26,804 | 3,926 |
Year Ended Dec. 31,
2007
|
Year Ended Dec. 31,
2008
|
Year Ended Dec. 31,
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Buildings
|
- | - | - | - | ||||||||||||
Plant
and equipment
|
1,685 | 50,553 | 7,924 | 1,161 | ||||||||||||
Motor
vehicles
|
184 | 466 | - | - | ||||||||||||
Assets
under construction
|
181,308 | 4,645 | 1,462 | 214 | ||||||||||||
Others
(computer and furniture fittings)
|
114 | 4,134 | - | - | ||||||||||||
Total
|
183,291 | 59,798 | 9,386 | 1,375 |
Payments
Due by Period
|
||||||||||||||||||||
Contractual
Commitments
|
Total
|
Less
than 1
Total
Year
|
1-3
Years
|
3-5
Years
|
More
than 5
Years
|
|||||||||||||||
(RMB
in thousands)
|
||||||||||||||||||||
Equipment
Purchase Contract(i)
|
149,430 | 149,430 | - | - | - | |||||||||||||||
Bank
loans(ii)
|
||||||||||||||||||||
Principal
|
178,179 | 153,179 | 15,000 | - | 10,000 | |||||||||||||||
Interest(iii)
|
8,552 | 8,552 | - | - | - | |||||||||||||||
Operating
leases(iv)
|
120 | 120 | - | - | - | |||||||||||||||
Total
|
336,281 | 311,281 | 15,000 | - | 10,000 |
(i)
|
The
purchase of equipment has been financed by the sale of our ordinary shares
and in the future would be financed by bank borrowings and internally
generated funds from operations.
|
(ii)
|
We
had short-term bank loans of RMB 153.2 million at December 31,
2009 that are due at various times in 2010. We also have long-term loans
for RMB 25 million. We renegotiated substantially all of our outstanding
indebtedness resulting in approximately RMB 165.0 million of secured
indebtedness of the total outstanding. Our obligations under our existing
loans have been mainly met through the cash flow from our operations and
our financing activities. In the past, cash flow from operations has been
sufficient to meet payment obligations and/or we have been able to extend
our borrowings. In the event that our cash flows are insufficient to
satisfy these obligations, we may consider additional bank loans, issuing
bonds, or other forms of financing to satisfy our capital requirements.
|
(iii)
|
The
interest expenses are estimated based on the interest rate of short-term
borrowings adopted by People Bank of China on December 31, 2009 plus an
estimated risk premium on borrowing.
|
(iv)
|
The
operating leases mainly relate to our rental of warehouse. The term of
these leases typically ranges from 1-3 years, and are renewable, subject
to renegotiation of terms, upon expiration. We intend to finance these
operating leases from our cash flows from operations.
|
Name
|
Age
|
Position
|
||
Xiaoan
He
|
48
|
Chairman
and Chief Executive Officer
|
||
Xiuyong
Zhang
|
40
|
Chief
Financial Officer and Director
|
||
Tee
Chuang Khoo
|
64
|
Independent
Director
|
||
Changrong
Ji
|
64
|
Independent
Director
|
||
Yudong
Huang
(4)
|
45
|
Independent
Director
|
||
Bo
Xu
(1)
|
47
|
Secretary
|
||
Zhibing
Qian
(2)
|
45
|
Senior
Vice President and Secretary
|
||
Bin
Sun
(3)
|
55
|
President
of Shandong Fuwei
|
||
Xiaoming
Wang
|
50
|
Vice
President (Production) of Shandong Fuwei
|
||
Hanyong
Lee
|
|
54
|
|
Vice
President (Research & Development) of Shandong Fuwei
|
|
·
|
selecting
the independent auditors and pre-approving all auditing and non-auditing
services permitted to be performed by the independent auditors;
|
|
·
|
reviewing
and approving all proposed related-party transactions;
|
|
·
|
discussing
the annual audited financial statements with management and the
independent auditors;
|
|
·
|
annually
reviewing and reassessing the adequacy of our audit committee charter;
|
|
·
|
meeting
separately and periodically with management and the independent auditors;
|
|
·
|
reviewing
such other matters that are specifically delegated to our audit committee
by our board of directors from time to time; and
|
|
·
|
reporting
regularly to the full board of directors.
|
|
·
|
reviewing
and determining the compensation package for our senior executives;
|
|
·
|
reviewing
and making recommendations to our board with respect to the compensation
of our directors;
|
|
·
|
reviewing
and approving officer and director indemnification and insurance matters;
|
|
·
|
reviewing
and approving any employee loan in an amount equal to or greater than RMB
100,000; and
|
|
·
|
reviewing
periodically and approving any long-term incentive compensation or equity
plans, programs or similar arrangements, annual bonuses, employee pension
and welfare benefit plans.
|
|
·
|
identifying
and recommending to the board nominees for election or re-election to the
board;
|
|
·
|
making
appointments to fill any vacancy on our board;
|
|
·
|
reviewing
annually with the board the current composition of the board in light of
the characteristics of independence, age, skills, experience and
availability of service to us;
|
|
·
|
identifying
and recommending to the board any director to serve as a member of the
board’s committees;
|
|
·
|
advising
the board periodically with respect to significant developments in the law
and practice of corporate governance as well as our compliance with
applicable laws and regulations, and making recommendations to the board
on all matters of corporate governance and on any corrective action to be
taken; and
|
|
·
|
monitoring
compliance with our code of business conduct and ethics, including
reviewing the adequacy and effectiveness of our procedures to ensure
proper compliance.
|
|
·
|
each
person known to us to own beneficially more than 5% of our ordinary
shares; and
|
|
·
|
each
of our directors and executive officers who beneficially own our ordinary
shares.
|
Shares Beneficially Owned
|
||||||||
Number
|
Percent
|
|||||||
Executive
Officers and Directors:
|
||||||||
— | — | |||||||
Xiaoan
He
|
— | — | ||||||
Xiuyong
Zhang
|
— | — | ||||||
Tee
Chuang Khoo
|
— | — | ||||||
Changrong
Ji
|
— | — | ||||||
Yudong
Huang
(3)
|
— | — | ||||||
Bo
Xu
|
— | — | ||||||
Zhibing
Qian
|
— | — | ||||||
Bin
Sun
|
— | — | ||||||
Xiaoming
Wang
|
— | — | ||||||
Hanyong
Lee
|
— | — | ||||||
All
directors and executive officers as a group ( 8 persons)
|
— | — | ||||||
5%
Shareholders:
|
||||||||
Apex
Glory Holdings Limited
(1)
|
6,912,503 | 52.9 | % | |||||
Easebright
Investments Limited
(2)
|
1,637,497 | 12.5 | % |
Ordinary
Shares
|
||||||||
(Year
Ended)
|
High
|
Low
|
||||||
December
31,2007
|
$ | 17.14 | $ | 2.12 | ||||
December
31,2008
|
$ | 6.19 | $ | 0.70 | ||||
December
31,2009
|
$ | 2.07 | $ | 0.34 |
Ordinary
Shares
|
||||||||
(Quarter
Ended)
|
High
|
Low
|
||||||
March
31,2008
|
$ | 6.19 | $ | 2.52 | ||||
June
30, 2008
|
$ | 3.69 | $ | 2.27 | ||||
September
30, 2008
|
$ | 2.58 | $ | 1.21 | ||||
December
31,2008
|
$ | 1.41 | $ | 0.70 | ||||
March
31,2009
|
$ | 0.99 | $ | 0.34 | ||||
June
30, 2009
|
$ | 2.07 | $ | 0.65 | ||||
September
30, 2009
|
$ | 1.55 | $ | 1.10 | ||||
December
31,2009
|
$ | 1.93 | $ | 1.00 |
Ordinary
Shares
|
||||||||
(Month
Ended)
|
High
|
Low
|
||||||
October
31, 2009
|
$
|
1.25
|
$
|
1.00
|
||||
November
30, 2009
|
$
|
1.45
|
$
|
1.05
|
||||
December
31, 2009
|
$
|
1.93
|
$
|
1.16
|
||||
January
30, 2010
|
$
|
1.32
|
$
|
1.03
|
||||
February
28, 2010
|
$
|
1.14
|
$
|
0.86
|
||||
March
31, 2010
|
$
|
1.25
|
$
|
1.02
|
|
·
|
is
a company that conducts its business outside the Cayman Islands;
|
|
·
|
is
exempted from certain requirements of the Companies Law, including the
filing of any annual return of its shareholders with the Registrar of
Companies or the Immigration Board;
|
|
·
|
does
not have to make its register of shareholders open to inspection; and
|
|
·
|
may
obtain an undertaking against the imposition of any future taxation.
|
|
·
|
an
act which is ultra vires or illegal;
|
|
·
|
an
act which constitutes a fraud against the minority shareholder and the
wrongdoers are themselves in control of us; and an irregularity in
the passing of a resolution which requires a qualified (or special)
majority.
|
|
·
|
increase
our capital by such sum, to be divided into shares of such amounts, as the
resolution shall prescribe;
|
|
·
|
consolidate
and divide all or any of our share capital into shares of larger amount
than our existing shares;
|
|
·
|
cancel
any shares which at the date of the passing of the resolution have not
been taken or agreed to be taken by any person, and diminish the amount of
our share capital by the amount of the shares so cancelled subject to the
provisions of the Companies Law;
|
|
·
|
sub-divide
our shares or any of them into shares of smaller amount than is fixed by
our amended and restated memorandum and articles of association, subject
nevertheless to the Companies Law, and so that the resolution whereby any
share is subdivided may determine that, as between the holders of the
share resulting from such subdivision, one or more of the shares may have
any such preference or other special rights, over, or may have such
deferred rights or be subject to any such restrictions as compared with,
the others as we have power to attach to unissued or new shares; and
|
|
·
|
divide
shares into several classes and without prejudice to any special rights
previously conferred on the holders of existing shares, attach to the
shares respectively as preferential, deferred, qualified or special
rights, privileges, conditions or such restrictions which, in the absence
of any such determination in a general meeting, may be determined by our
directors.
|
|
·
|
the
instrument of transfer is lodged with us accompanied by the certificate
for the shares to which it relates and such other evidence as our
directors may reasonably require to show the right of the transferor to
make the transfer;
|
|
·
|
the
instrument of transfer is in respect of only one class of shares;
|
|
·
|
the
instrument of transfer is properly stamped (in circumstances where
stamping is required);
|
|
·
|
in
the case of a transfer to joint holders, the number of joint holders to
whom the share is to be transferred does not exceed four; and
|
|
·
|
a
fee of such maximum sum as the NASDAQ Global Market may at any time
determine to be payable or such lesser sum as our directors may from time
to time require is paid to us in respect thereof.
|
|
·
|
all
checks or warrants in respect of dividends of such shares, not being less
than three in number, for any sums payable in cash to the holder of such
shares have remained c for a period of twelve years prior to the
publication of the advertisement and during the three months referred to
in the third bullet point below;
|
|
·
|
we
have not during that time received any indication of the whereabouts or
existence of the shareholder or person entitled to such shares by death,
bankruptcy or operation of law; and
|
|
·
|
we
have caused an advertisement to be published in newspapers in the manner
stipulated by our amended and restated memorandum and articles of
association, giving notice of our intention to sell these shares, and a
period of three months has elapsed since such advertisement and the NASDAQ
Global Market has been notified of such intention.
|
|
·
|
the
designation of the series;
|
|
·
|
the
number of shares of t
|
|
·
|
the
dividend rights, conversion rights, voting rights; and
|
|
·
|
the
rights and terms of redemption and liquidation preferences.
|
|
·
|
a
duty to act in good faith in the best interests of the company;
|
|
·
|
a
duty not to personally profit from opportunities that arise from the
office of director;
|
|
·
|
a
duty to avoid conflicts of interest; and
|
|
·
|
a
duty to exercise powers for the purpose for which such powers were
intended.
|
|
·
|
the
company is not proposing to act illegally or ultra vires and the statutory
provisions as to majority vote have been complied with;
|
|
·
|
the
shareholders have been fairly represented at the meeting in question;
|
|
·
|
the
arrangement is such as a businessman would reasonably approve; and
|
|
·
|
the
arrangement is not one that would more properly be sanctioned under some
other provision of the Companies Law or that would amount to a “fraud on
the minority.”
|
|
·
|
a
company is acting or proposing to act illegally or beyond the scope of its
authority;
|
|
·
|
the
act complained of, although not beyond the scope of its authority, could
be effected duly if authorized by more than a simple majority vote which
has not been obtained; and
|
|
·
|
those
who control the company are perpetrating a “fraud on the minority.”
|
|
·
|
an
individual citizen or resident of the United States;
|
|
·
|
a
corporation (or other entity treated as a corporation) that is created or
organized in or under the laws of the United States, any state thereof or
the District of Columbia;
|
|
·
|
an
estate whose income is includible in gross income for U.S. federal
income tax purposes regardless of its source; or
|
|
·
|
a
trust if (i) a U.S. court can exercise primary supervision over the
trust’s administration and one or more U.S. persons are authorized to
control all substantial decisions of the trust, or (ii) it has a valid
election in effect under applicable U.S. Treasury regulations to be
treated as a U.S. person.
|
|
·
|
financial
institutions or financial services entities;
|
|
·
|
broker-dealers;
|
|
·
|
taxpayers
who have elected mark-to-market accounting;
|
|
·
|
tax-exempt
entities;
|
|
·
|
government
or agencies or instrumentalities thereof;
|
|
·
|
regulated
investment companies;
|
|
·
|
real
estate investment trusts;
|
|
·
|
insurance
companies;
|
|
·
|
persons
that actually or constructively own 10% or more of our voting shares;
|
|
·
|
certain
expatriates or former long-term residents of the United States;
|
|
·
|
persons
that hold our ordinary shares as part of a straddle, constructive sale,
hedging, conversion or other integrated transaction; or
|
|
·
|
persons
whose functional currency is not the U.S. dollar.
|
|
·
|
any
gain recognized by the U.S. Holder you realize on the sale or other
disposition (including a pledge)of its ordinary shares,
|
|
·
|
any
“
excess distribution
”
made to the
U.S. Holder (generally, any distributions to such U.S. Holder during a
taxable year that are greater than 125% of the average annual
distributions received by such U.S. Holder in respect of the
ordinary shares during the three preceding taxable years or, if shorter,
such holder’s holding period for the ordinary shares).
|
|
·
|
Under
these rules,
|
|
·
|
the
U.S. Holder’s gain or excess distribution will be allocated ratably over
its holding period for the ordinary shares,
|
|
·
|
the
amount allocated to the taxable year in which the U.S. Holder recognized
the gain or received the excess distribution or to any taxable year prior
to the first taxable year in which we are a PFIC will be taxed as ordinary
income,
|
|
·
|
the
amount allocated to other taxable years each prior year, with certain
exceptions, will be taxed at the highest tax rate in effect for that year
and applicable to the U.S. Holder (and cannot be offset by any net
operating losses for such years), and
|
|
·
|
the
interest charge generally applicable to underpayments of tax will be
imposed in respect of the tax attributable to each such other taxable
year.
|
|
·
|
fails
to provide an accurate taxpayer identification number,
|
|
·
|
is
notified by the IRS that backup withholding will be required, or
|
|
·
|
in
certain circumstances, fails to comply with applicable certification
requirements.
|
Approximate
Allocation of Net
Proceeds
|
Approximate
Percentage of Net
Proceeds
|
|||||||
Net
proceeds from IPO
|
$ | 29,938,129 | 100.0 | % | ||||
Investment
in new production line equipment
|
16,140,417 | 53.91 | ||||||
Buildings
and property for new production line
|
8,997,711 | 30.05 | ||||||
Sales
and marketing
|
300,000 | 1.0 | ||||||
General
corporate purpose, including working capital
|
4,500,000 | 15.3 |
No.
|
Description
|
|
1.2
|
Form
of Amended Memorandum of Association of Fuwei Films (Holdings) Co., Ltd.
**
|
|
1.3
|
Articles
of Association Fuwei Films (Holdings) Co., Ltd. ***
|
|
4.1
|
Form
of Underwriting Agreement. *
|
|
4.2
|
Loan
Agreement between Communication Bank of China of Fuwei Films (Shandong)
Co., Ltd. dated January 15, 2007***
|
|
4.3
|
Loan
Agreement between Communication Bank of China of Fuwei Films (Shandong)
Co., Ltd. dated January 15, 2007***
|
|
4.4
|
Asset
Purchase Agreement between Fuwei Plastics and Shandong Weifang Auction
Firm dated October 9, 2003 **
|
|
4.5
|
Purchase
Agreement between Beijing Baorui and Weifang Jing Cheng Auction Co., Ltd.
dated December 17, 2004 **
|
|
4.6
|
Service
Agreement between Fuwei Films (Holdings) Co., Ltd. and Xiaoan He**
|
|
4.7
|
Employment
Agreement between Fuwei Films (Holdings) Co., Ltd. and Xiaoan He **
|
|
4.8
|
Employment
Agreement between Fuwei Films (Holdings) Co., Ltd. and Xiaoming Wang **
|
|
4.9
|
Employment
Agreement between Fuwei Films (Holdings) Co., Ltd. and Xiuyong Zhang **
|
|
4.10
|
Equipment
Contract between Fuwei Films (Holdings) Co., Ltd. and Brükner dated as of
June 2005**
|
|
4.11
|
Credit
Letter from Communication Bank of China dated May 8, 2006 **
|
|
4.12
|
Contract
between Fuwei Films (Shandong) Co. Ltd. and Lindauer Dornier GmbH, dated
January 20, 2007****
|
|
4.13
|
Amendment
to the Contract of January 20, 2007 between Fuwei Films (Shandong) Co.
Ltd. and Lindauer Dornier GmbH, dated February 2, 2007****
|
|
4.14
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and Bank of
Communication, dated July 16, 2008 ****
|
|
4.15
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and Weifang City
Commercial Bank, dated July 18, 2008****
|
|
4.16
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and Weifang City
Commercial Bank, dated December 2, 2008 ****
|
|
4.17
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and Weifang City
Commercial Bank, dated January 13, 2009 ****
|
|
4.18
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and Weifang City
Commercial Bank, dated January 16, 2009 ****
|
|
4.19
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and Bank of
Communication, dated June 9, 2009*****
|
|
4.20
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and Bank of
Communication, dated June 9, 2009*****
|
|
4.21
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and the
Weifang Dongfang
State-owned Assets Management Co., Ltd., dated November 20, 2009 *****
|
|
4.22
|
Loan
Contract between Fuwei Films (Shandong) Co. Ltd. and Bank of Weifang,
dated January 13, 2010 *****
|
|
8.1
|
List
of the company’s significant subsidiaries, their jurisdiction of
incorporation and the names under which they operate business, if
different from their name. ***
|
|
11.1
|
Code
of Ethics for CEO and Senior Financial Officers. ***
|
|
12.1
|
Certification
of Chief Executive Officer required by Section 302 of the Sarbanes-Oxley
Act of 2002. *****
|
|
12.2
|
Certification
of Chief Financial Officer required by Section 302 of the Sarbanes-Oxley
Act of 2002. *****
|
|
13.1
|
Certification
of Chief Executive Officer and Chief Financial Officer required by Section
906 of the Sarbanes-Oxley Act of 2002. ****
|
|
*
|
Filed
with the Company’s amendment to Registration Statement on Form F-1/A filed
with the SEC on December 12, 2006.
|
|
**
|
Filed
with the Company’s Registration Statement on Form F-1 filed with the SEC
on November 24, 2006.
|
|
***
|
Filed
with the Company’s Annual Report on Form 20-F for the year ended December
31, 2006 filed with the SEC on April 2, 2007.
|
|
****
|
Filed
with the Company’s Annual Report on Form 20-F for the year ended December
31, 2008 filed with the SEC on March 30, 2009.
|
|
*****
|
Filed
herewith.
|
Fuwei
Films (Holdings) Co., Ltd.
|
|||
By:
|
/s/
Xiaoan He
|
|
|
Name:
Xiaoan He
|
|||
Title:
Chairman, Chief Executive Officer
|
|||
By:
|
/s/
Xiuyong Zhang
|
|
|
Name:
Xiuyong Zhang
|
|||
Title:
Chief Financial Officer
|
Audited Conso
lidated Financial Statements of Fuwei Films
(Holdings) Co., Ltd. and subsidiaries
|
Page
|
|
Report
of Independent Registered Public Accounting Firm — Kabani & Company,
Inc.
|
F-2
|
|
Consolidated
Balance Sheets as of December 31, 2008 and 2009
|
F-3
|
|
Consolidated
Statements of Income and Comprehensive Income for the years ended December
31, 2007, 2008 and 2009
|
F-4
|
|
Consolidated
Statements of Shareholders’ Equity for the years ended December 31, 2007,
2008 and 2009
|
F-5
|
|
Consolidated
Statements of Cash Flows for the years ended December 31, 2007, 2008 and
2009
|
F-6
|
|
Notes
to the Consolidated Financial Statements for the years ended December 31,
2007, 2008 and 2009
|
F-7 - F-29
|
2008
|
2009
|
||||||||||||
Notes
|
RMB
|
RMB
|
US$
|
||||||||||
Assets
|
|
||||||||||||
Current
assets
|
|
|
|
||||||||||
Cash
and cash equivalents
|
15,823
|
26,804
|
3,926
|
||||||||||
Restricted
cash
|
10,411
|
12,541
|
1,837
|
||||||||||
Accounts
receivable, net
|
4
|
38,579
|
28,785
|
4,216
|
|||||||||
Inventories,net
|
5
|
30,589
|
45,039
|
6,597
|
|||||||||
Advance
to suppliers
|
6
|
6,846
|
3,956
|
579
|
|||||||||
Prepayments
and other receivables
|
6
|
1,857
|
957
|
140
|
|||||||||
Deferred
tax assets - current
|
457
|
1,198
|
175
|
||||||||||
Total
current assets
|
104,562
|
119,282
|
17,470
|
||||||||||
Plant,
properties and equipment, net
|
7
|
259,235
|
318,600
|
46,668
|
|||||||||
Construction
in progress
|
7
|
319,408
|
237,118
|
34,732
|
|||||||||
Lease
prepayments, net
|
8
|
22,507
|
21,548
|
3,156
|
|||||||||
Advanced
to suppliers - long term
|
4,308
|
2,367
|
347
|
||||||||||
Goodwill
|
10
|
10,276
|
10,276
|
1,505
|
|||||||||
Deposit
|
17,613
|
21,000
|
3,076
|
||||||||||
Deferred
tax assets - non current
|
19
|
1,995
|
5,318
|
779
|
|||||||||
Total
assets
|
739,904
|
735,509
|
107,733
|
||||||||||
LIABILITIES
AND EQUITY
|
|||||||||||||
Current
liabilities
|
|
|
|
||||||||||
Short-term
bank loans
|
12
|
164,764
|
153,179
|
22,435
|
|||||||||
Accounts
payables
|
23,301
|
25,898
|
3,794
|
||||||||||
Advance
from customers
|
8,781
|
12,608
|
1,847
|
||||||||||
Accrued
expenses and other payables
|
13
|
7,460
|
6,981
|
1,023
|
|||||||||
|
204,305
|
198,666
|
29,099
|
||||||||||
Long-term
loans
|
12
|
5,000
|
25,000
|
3,662
|
|||||||||
Total
liabilities
|
209,305
|
223,666
|
32,761
|
||||||||||
Commitments and contingencies
|
24
|
||||||||||||
Equity
|
|
|
|
|
|||||||||
Shareholders’
equity
|
14
|
||||||||||||
Common
Stock (of US$0.129752 par value; 20,000,000 shares authorized; 13,062,500
issued and outstanding as of December 31, 2008 and 2009, respectively)
|
13,323
|
13,323
|
1,952
|
||||||||||
Additional
paid-in capital
|
311,907
|
311,907
|
45,687
|
||||||||||
Statutory
reserve
|
29,338
|
29,338
|
4,297
|
||||||||||
Retained
earnings
|
174,970
|
156,006
|
22,851
|
||||||||||
Accumulated
other comprehensive income
|
1,061
|
993
|
145
|
||||||||||
Total
shareholders’ equity
|
530,599
|
511,567
|
74,932
|
||||||||||
Non-controlling
interest
|
-
|
276
|
40
|
||||||||||
Total
equity
|
530,599
|
511,843
|
74,972
|
||||||||||
Total
liabilities and equity
|
739,904
|
735,509
|
107,733
|
2007
|
2008
|
2009
|
|||||||||||||||||
Notes
|
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||||
Revenues,
net
|
15
|
449,373 | 447,255 | 320,731 | 46,980 | ||||||||||||||
Cost
of goods sold
|
16,17
|
(349,531 | ) | (376,923 | ) | (296,118 | ) | (43,375 | ) | ||||||||||
|
|
|
|
||||||||||||||||
Gross
profit
|
99,842 | 70,332 | 24,612 | 3,605 | |||||||||||||||
|
|
|
|
||||||||||||||||
Operating
expenses
|
|||||||||||||||||||
-
Distribution expenses
|
16,17
|
(15,061 | ) | (15,604 | ) | (15,227 | ) | (2,230 | ) | ||||||||||
-
Administrative expenses
|
16
|
(20,515 | ) | (30,124 | ) | (25,932 | ) | (3,798 | ) | ||||||||||
|
|
|
|
||||||||||||||||
Total
operating expenses
|
(35,576 | ) | (45,728 | ) | (41,159 | ) | (6,028 | ) | |||||||||||
|
|
|
|
||||||||||||||||
Operating
income/(loss)
|
64,266 | 24,604 | (16,547 | ) | (2,423 | ) | |||||||||||||
|
|
|
|
||||||||||||||||
Other
income/(expense)
|
|||||||||||||||||||
-
Interest income
|
589 | 688 | 154 | 23 | |||||||||||||||
-
Interest expense
|
18
|
(13,233 | ) | (3,995 | ) | (6,540 | ) | (958 | ) | ||||||||||
-
Others income / (expense), net
|
319 | (174 | ) | (92 | ) | (13 | ) | ||||||||||||
Total
other income/(expense)
|
(12,325 | ) | (3,481 | ) | (6,478 | ) | (948 | ) | |||||||||||
Income
before income tax benefit/(expense)
|
51,941 | 21,123 | (23,024 | ) | (3,371 | ) | |||||||||||||
Income
tax benefit/(expense)
|
19
|
(4,681 | ) | (2,966 | ) | 4,0 64 | 595 | ||||||||||||
Net
income/(loss)
|
47,260 | 18,157 | (18,960 | ) | (2,776 | ) | |||||||||||||
Non-controlling
interest
|
-
|
-
|
3 | - | |||||||||||||||
Net
income/(loss) attributable to the Company
|
47,260
|
18,157
|
(18,963 | ) | (2,77 6 | ) | |||||||||||||
Other
comprehensive income/(loss)
|
|
|
|
|
|||||||||||||||
-
Foreign currency translation adjustments
|
(637 | ) | (87 | ) | (68 | ) | (10 | ) | |||||||||||
|
|
|
|
|
|||||||||||||||
Comprehensive
income/(loss)
|
46,623 | 18,070 | (19,032 | ) | (2,786 | ) | |||||||||||||
|
|
|
|
||||||||||||||||
Earnings
(loss) per share,
Basic
and diluted
|
24
|
3.62 | 1.39 | (1.45 | ) | (0.21 | ) | ||||||||||||
Weighted
average number ordinary shares,
Basic and diluted
|
24
|
13,062,500 | 13,062,500 | 13,062,500 | 13,062,500 |
Ordinary Shares
|
Additional
|
Accumulated other
|
|
Total
|
||||||||||||||||||||
Number of
shares
|
Amount
|
paid-in
capital
|
comprehensive
income
|
Retained
earnings
|
shareholders'
equity
|
|||||||||||||||||||
RMB
|
RMB
|
RMB
|
RMB
|
RMB
|
||||||||||||||||||||
Balance
as of December 31, 2006
|
13,062,500 | 13,323 | 311,907 | 1,785 | 138,892 | 465,907 | ||||||||||||||||||
Net
income
|
- | - | - | - | 47,260 | 47,260 | ||||||||||||||||||
Foreign
currency translation adjustment
|
- | - | - | (637 | ) | - | (637 | ) | ||||||||||||||||
Balance
as of December 31, 2007
|
13,062,500 | 13,323 | 311,907 | 1,148 | 186,152 | 512,530 | ||||||||||||||||||
Net
income
|
- | - | - | - | 18,157 | 18,157 | ||||||||||||||||||
Foreign
currency translation adjustment
|
- | - | - | (87 | ) | - | (87 | ) | ||||||||||||||||
Balance
as of December 31, 2008
|
13,062,500 | 13,323 | 311,907 | 1,061 | 204,309 | 530,599 | ||||||||||||||||||
Net
loss
|
- | - | - | - | (18,963 | ) | (18,963 | ) | ||||||||||||||||
Foreign
currency translation adjustment
|
- | - | - | (68 | ) | - | (68 | ) | ||||||||||||||||
Balance
as of December 31, 2009 _
RMB
|
13,062,500 | 13,323 | 311,907 | 993 | 185,346 | 511,567 | ||||||||||||||||||
Balance
as of December 31, 2009 _
US$
|
13,062,500 | 1,952 | 45,687 | 145 | 27,148 | 74,932 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Cash
flow from operating activities
|
||||||||||||||||
Net
income/(loss)
|
47,260 | 18,157 | (18,960 | ) | (2,776 | ) | ||||||||||
Adjustments
to reconcile net income /(loss) to net cash
|
||||||||||||||||
provided
by operating activities
|
|
|
|
|
||||||||||||
-
Depreciation of property, plant and equipment
|
23,217 | 25,168 | 35,464 | 5,195 | ||||||||||||
-
Amortization of intangible assets
|
73 | 490 | 889 | 130 | ||||||||||||
-
Lease prepayments charged to expense
|
741 | - | - | - | ||||||||||||
-
Deferred income taxes
|
152 |
(1,748
|
) |
(4,064
|
) | (595 | ) | |||||||||
-
Bad debt expense/(recovery)
|
1,772 | 4,818 | 697 | 102 | ||||||||||||
-
Inventory provision
|
-
|
-
|
4,242
|
621
|
||||||||||||
Changes in operating assets and liabilities | ||||||||||||||||
-
Accounts receivable
|
17,335 | 18,186 | 11,609 | 1,700 | ||||||||||||
-
Inventories
|
(19,659 | ) | 11,080 | (18,693 | ) | (2,742 | ) | |||||||||
-
Advance to suppliers
|
- | 2,384 | 4,831 | 708 | ||||||||||||
-
Prepaid expenses and other current assets
|
6,698 | 89 | (4,929 | ) | (722 | ) | ||||||||||
-
Accounts payable
|
6,824 | 3,691 | (4,475 | ) | (655 | ) | ||||||||||
-
Accrued expenses and other payables
|
(1,557 | ) | (284 | ) | 1,902 | 279 | ||||||||||
-
Advance from customers
|
- | (2,176 | ) | 3,827 | 561 | |||||||||||
-
Tax payable
|
- | 172 | (2,411 | ) | (353 | ) | ||||||||||
Net
cash provided by operating activities
|
82,856 | 80,027 | 9,929 | 1,453 | ||||||||||||
Cash
flow from investing activities
|
|
|
|
|
||||||||||||
Purchases
of property, plant and equipment
|
(590 | ) | (56,093 | ) | (87,758 | ) | (12,847 | ) | ||||||||
Restricted
cash related to trade finance
|
(61,598 | ) | 54,498 | (2,130 | ) | (312 | ) | |||||||||
Addition
to construction in progress
|
(184,600 | ) | (54,155 | ) | 82,290 | 12,054 | ||||||||||
Deposits
for purchase
|
- | (21,000 | ) |
-
|
- | |||||||||||
Net
cash used in investing activities
|
(246,787 | ) | (76,750 | ) | (7,599 | ) | (1,112 | ) | ||||||||
Cash
flow from financing activities
|
|
|
|
|
||||||||||||
Principal
payments of short-term bank loans
|
(51,650 | ) | (23,262 | ) | (11,585 | ) | (1,697 | ) | ||||||||
Proceeds
from short-term bank loans
|
- | 5,000 | 20,000 | 2,930 | ||||||||||||
Net
cash used in/(provided) by financing activities
|
(51,650 | ) | (18,262 | ) | 8,415 | 1,233 | ||||||||||
Effect
of foreign exchange rate changes
|
(3,448 | ) | (104 | ) | 236 | 44 | ||||||||||
Net
increase (decrease) in cash and cash equivalent
|
(219,029 | ) | (15,086 | ) | 10,981 | 1,618 | ||||||||||
Cash
and cash equivalent
|
|
|
|
|
||||||||||||
At
beginning of the year
|
249,939 | 30,909 | 15,823 | 2,308 | ||||||||||||
At
end of the year
|
30,909 | 15,823 | 26,804 | 3,926 | ||||||||||||
SUPPLEMENTARY
DISCLOSURE:
|
||||||||||||||||
Interest
paid
|
12,921 | 11,705 | 8,399 | 1,230 | ||||||||||||
Income
tax paid
|
- | 2,966 |
-
|
- | ||||||||||||
SUPPLEMENTARY
SCHEDULE OF NONCASH INVESTING AND FINANCIAL ACTIVITIES:
|
||||||||||||||||
During
the year ended December 31, 2009,
the
Company acquired equipment by
incurring
accounts payable in the amount of:
|
- | - | 7,071 | 1,035 |
Fair
value of shares on measurement date
|
US$
8.28 per share
|
|||
Expected
volatility
|
57.26 | % | ||
Expected
dividends
|
0.00 | % | ||
Expected
term (in years)
|
5 | |||
Risk-free
rate
|
4.56 | % |
December 31, 2008
|
December 31, 2009
|
|||||||||||
RMB
|
RMB
|
US$
|
||||||||||
Accounts
receivable
|
41,245 | 22,289 | 3,265 | |||||||||
Less:
Allowance for doubtful accounts
|
(4,074 | ) | (2, 259 | ) | (331 | ) | ||||||
37,171 | 20,030 | 2,934 | ||||||||||
Bills
receivable
|
1,408 | 8,755 | 1,282 | |||||||||
|
|
|
||||||||||
38,579 | 28,785 | 4,216 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Balance
at beginning of year
|
872 | 2,644 | 4,074 | 597 | ||||||||||||
Bad
debt expense/(recovery)
|
1,772 | 1,430 | (1,713 | ) | (251 | ) | ||||||||||
Write-offs
|
- | - | (102 | ) | (15 | ) | ||||||||||
Balance
at end of year
|
2,644 | 4,074 | 2,259 | 331 |
December 31, 2008
|
December 31, 2009
|
|||||||||||
RMB
|
RMB
|
US$
|
||||||||||
Raw
materials
|
11,239 | 28,756 | 4,212 | |||||||||
Work-in-progress
|
1,527 | 2,274 | 333 | |||||||||
Finished
goods
|
17,285 | 17,617 | 2,580 | |||||||||
Consumables
and spare parts
|
539 | 633 | 93 | |||||||||
Inventory
impairment
|
- | ( 4,242 | ) | ( 621 | ) | |||||||
|
|
|
|
|||||||||
30,589 | 45,039 | 6,597 |
2008
|
2009
|
||||||||||||
RMB
|
RMB
|
US$
|
|||||||||||
Purchase
deposits of raw materials
|
6,846 | 3,956 | 579 | ||||||||||
Purchase
deposits of Equipment
|
4,308 | 2,367 | 347 | ||||||||||
Prepayments
(Note A)
|
741 | 741 | 109 | ||||||||||
Other
receivables
|
1,116 | 216 | 32 | ||||||||||
13,011 | 7,280 | 1,067 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Balance
at beginning of year
|
- | 136 | 3,523 | 516 | ||||||||||||
Bad
debt expense/(recovery)
|
136 | 3,387 | 2,512 | 368 | ||||||||||||
Write-offs
|
- | - | - | - | ||||||||||||
Balance
at end of year
|
136 | 3,523 | 6,035 | 884 |
December 31, 2008
|
December 31, 2009
|
|||||||||||
RMB
|
RMB
|
US$
|
||||||||||
Buildings
|
34,807 | 43,273 | 6,339 | |||||||||
Plant
and equipment
|
330,106 | 416,143 | 60,955 | |||||||||
Computer
equipment
|
1,387 | 1,421 | 208 | |||||||||
Furniture
and fixtures
|
5,799 | 5,929 | 868 | |||||||||
Motor
vehicles
|
1,739 | 1,739 | 255 | |||||||||
373,838 | 468,505 | 68,625 | ||||||||||
Less:
accumulated depreciation
|
(114,604 | ) | (149,905 | ) | (21,958 | ) | ||||||
259,235 | 318,600 | 46,668 |
2008
|
2009
|
|||||||||||
RMB
|
RMB
|
US$
|
||||||||||
Non-current
portion
|
22,507 | 21,548 | 3,156 | |||||||||
Current
portion - amount charged to expense next year
|
741 | 741 | 109 | |||||||||
23,248 | 22,289 | 3,265 |
Interest rate
|
December 31, 2008
|
December 31, 2009
|
||||||||||||||
Lender
|
per
annum
|
RMB
|
RMB
|
US$
|
||||||||||||
SHORT-TERM
LOANS
|
||||||||||||||||
Bank of Communications Co., Ltd.
|
||||||||||||||||
-
July 16, 2008 to June 10, 2009
|
5.84 | % | 82,580 | - | - | |||||||||||
-
July 18, 2008 to June 23, 2009
|
5.84 | % | 60,000 | - | - | |||||||||||
-
June 9, 2009 to June 8, 2010
|
5.84 | % | - | 70,000 | 10,254 | |||||||||||
-
June 9, 2009 to June 8, 2010
|
5.84 | % | - | 70,000 | 10,254 | |||||||||||
Weifang Bank
|
||||||||||||||||
-
January 24, 2008 to January 12, 2009
|
0.00 | % | 10,000 | - | - | |||||||||||
-
January 30, 2008 to January 18, 2009
|
0.00 | % | 10,000 | - | - | |||||||||||
-
January 13, 2009 to January 12, 2010
|
0.00 | % | - | 10,000 | 1,465 | |||||||||||
Bank of China
|
||||||||||||||||
-
March 13, 2008 to March 13, 2009
|
5.45 | % | 2,184 | (80 | ) | (12 | ) | |||||||||
-
June 4, 2009 to June 4, 2010
|
1.38 | % | - | 3,259 | 477 | |||||||||||
LONG-TERM
LOANS
|
||||||||||||||||
Weifang Bank
|
||||||||||||||||
-
December 2, 2008 to December 2, 2011
|
0.00 | % | 5,000 | 5,000 | 732 | |||||||||||
-
January 16, 2009 to January 12, 2012
|
0.00 | % | - | 10,000 | 1,465 | |||||||||||
Weifang City Dongfang State-owned Assets
Management Co. Ltd.
|
||||||||||||||||
-
October 19, 2009 to October 18, 2017
|
5.346 | % | 5,000 | 10,000 | 1,465 | |||||||||||
169,764 | 178,179 | 26,097 |
RMB
|
US$
|
|||||||
1
year after
|
- | - | ||||||
2
year after
|
5,000 | 732 | ||||||
3
year after
|
20,000 | 2,930 |
December 31, 2008
|
December 31, 2009
|
|||||||||||
RMB
|
RMB
|
US$
|
||||||||||
Secured
by:
|
||||||||||||
-
property, plant and equipment
|
107,580 | 138,040 | 20,211 | |||||||||
-
lease prepayments
|
60,000 | 26,880 | 3,937 | |||||||||
-
bills receivable
|
- | - | - | |||||||||
Guaranteed
by a third party
|
- | 10,000 | 1,465 | |||||||||
Restricted
cash
|
2,184 | 3,259 | 477 | |||||||||
169,764 | 178,179 | 26,087 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
The
PRC
|
335,213 | 388,823 | 285,120 | 41,764 | ||||||||||||
Overseas
countries (principally Korea, United States of America and Europe)
|
114,160 | 58,432 | 35,611 | 5,216 | ||||||||||||
449,373 | 447,255 | 320,731 | 46,980 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Printing
film
|
83,453 | 56,607 | 35,231 | 5,161 | ||||||||||||
Stamping
film
|
94,366 | 139,571 | 174,356 | 25,539 | ||||||||||||
Metallization
film
|
30,668 | 45,148 | 35,138 | 5,147 | ||||||||||||
Special
film
|
169,961 | 107,404 | 34,004 | 4,981 | ||||||||||||
Base
film for other applications
|
70,925 | 98,526 | 42,002 | 6,152 | ||||||||||||
449,373 | 447,255 | 320,731 | 46,980 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Cost
of goods sold
|
22,557 | 25,362 | 32,139 | 4,708 | ||||||||||||
Distribution
expenses
|
14 | 42 | 55 | 8 | ||||||||||||
Administrative
expenses
|
719 | 614 | 2,976 | 436 | ||||||||||||
23,290 | 26,018 | 35,170 | 5,152 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Interest
cost capitalized
|
170 | 7,710 | 1,739 | 255 | ||||||||||||
Interest
cost charged to expense
|
13,233 | 3,995 | 6,540 | 958 | ||||||||||||
13,403 | 11,705 | 8,279 | 1,213 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Net
income
|
(4,340 | ) | (2,966 | ) | - | - | ||||||||||
Earnings
per share
|
||||||||||||||||
-
Basic
|
(0.33 | ) | (0.23 | ) | - | - | ||||||||||
-
Diluted
|
(0.33 | ) | (0.23 | ) | - | - |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Cayman
Islands
|
(5,893 | ) | (11,419 | ) | (4,989 | ) | (731 | ) | ||||||||
British
Virgin Islands
|
55 | (1 | ) | (1 | ) | (0.1 | ) | |||||||||
PRC
|
57,863 | 31,668 | (18,913 | ) | (2,770 | ) | ||||||||||
U.S.A
|
- | - | 8 | 1 | ||||||||||||
- | - | |||||||||||||||
52,025 | 20,248 | (23,895 | ) | (3,500 | ) |
Current
|
Deferred
|
Total
|
||||||||||
PRC income tax
|
RMB
|
RMB
|
RMB
|
|||||||||
Year
ended December 31, 2007
|
(4,529 | ) | (152 | ) | (4,681 | ) | ||||||
Year
ended December 31, 2008
|
(4,715 | ) | 1,748 | (2,966 | ) | |||||||
Year
ended December 31, 2009
|
-
|
4,064 | 4,064 | |||||||||
Year
ended December 31, 2009(US$)
|
-
|
595 | 595 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Income
before income taxes
|
51,941 | 21,123 | (23,024 | ) | (3,373 | ) | ||||||||||
Computed
“expected” tax expense
|
(7,791 | ) | (5,280 | ) | (3,453 | ) | (506 | ) | ||||||||
Non-deductible
expenses
|
(900 | ) | (3,031 | ) | 1,693 | 248 | ||||||||||
Non-taxable
income
|
24 | 1,022 | - | - | ||||||||||||
Tax
holiday
|
3,986 | 3,385 | - | - | ||||||||||||
Tax
rate differential of other tax jurisdictions
|
- | 937 | 1,760 | 258 | ||||||||||||
Actual
income tax expenses
|
(4,681 | ) | (2,966 | ) | - | - |
2008
|
2009
|
|||||||||||
RMB
|
RMB
|
US$
|
||||||||||
Current
|
||||||||||||
Accounts
receivable
|
(80 | ) | (353 | ) | (52 | ) | ||||||
Other
receivables
|
538 | 914 | 134 | |||||||||
Inventory
impairment
|
- | 636 | 93 | |||||||||
457 | 1,198 | 175 | ||||||||||
Non-current
|
||||||||||||
Property,
plant and equipment, principally due to differences in depreciation and
capitalized interest
|
1,993 | 2,134 | 313 | |||||||||
Construction
in progress, principally due to capitalized interest
|
422 | 161 | 24 | |||||||||
Lease
prepayments, principally due to differences in charges
|
(420 | ) | (431 | ) | (63 | ) | ||||||
Net
loss carryforward
|
- | 3,454 | 506 | |||||||||
1,995 | 5,318 | 779 | ||||||||||
Net
deferred income tax assets
|
2,452 | 6,516 | 954 |
Name
of party
|
Relationship
|
|
Shandong
Baorui Investment Co., Ltd (“Shandong Baorui”)
|
Former
shareholder (10%) of Shandong Fuwei. Shandong Baorui is 22.1% owned by the
Group Founders.
|
|
Shenghong
Group Co., Ltd (“Shenghong Group”)
|
Former
shareholder (90%) of Shandong Fuwei.
|
|
Shandong
Neo-Luck Plastic Co., Ltd (“Shandong Neo-Luck”)
|
The
Group Founders’ former employer, previously engaged in the business of
BOPET film production.
|
|
Weifang
Neo-Luck (Group) Co., Ltd (“Weifang Neo-Luck Group”)
|
Major
shareholder (59%) of Shandong Neo-Luck. One of the directors of the
Company was the general manager of Weifang Neo-Luck Group prior to joining
the Company in April 2005.
|
|
Easebright
Investments Limited (“Easebright Investments”)
|
Shareholder of
the Company
(
12.5%
)
|
|
Apex
Glory Holdings Limited (“Apex Glory Holdings”)
|
Shareholder
of the Company
(
52.9%
)
|
Percentage of total purchases (%)
|
||||||||||||||
Name of Vender
|
Supply
|
2007
|
2008
|
2009
|
||||||||||
Sinopec
Yizheng
|
PET
resin
|
58.5 | 46.4 | 44.8 | ||||||||||
Yizheng
Tianbao Polyester Co., Ltd.
|
Additives
|
23.9 | 16.6 | 10.3 |
RMB
|
||||
2010
|
344 | |||
2011
|
2 |
2007
|
2008
|
2009
|
||||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||||
Net
income (loss) available to ordinary shareholders
|
47,260 | 18,157 | (18,963 | ) | (2,778 | ) | ||||||||||||
Denominator
for basic net income available to
ordinary shareholders:
|
(loss)
|
|||||||||||||||||
Weighted
average number of ordinary shares
|
||||||||||||||||||
Outstanding
|
13,062,500 | 13,062,500 | 13,062,500 | 13,062,500 | ||||||||||||||
Basic
earnings (loss) per shar
|
3.62 | 1.39 | (1.45 | ) | (0.21 | ) | ||||||||||||
Net
income (loss) available to ordinary shareholders
|
47,260 | 18,157 | (18,963 | ) | (2,778 | ) | ||||||||||||
Denominator
for diluted net income available to ordinary shareholders:
|
(loss)
|
|||||||||||||||||
Weighted
average number of ordinary shares
|
||||||||||||||||||
Outstanding
|
13,062,500 | 13,062,500 | 13,062,500 | 13,062,500 | ||||||||||||||
Weighted
average number of share options
|
- | |||||||||||||||||
13,062,500 | 13,062,500 | 13,062,500 | 13,062,500 | |||||||||||||||
Diluted
earnings (loss) per share
|
3.62 | 1.39 | (1.45 | ) | (0.21 | ) |
2008
|
2009
|
|||||||||||
RMB
|
RMB
|
US$
|
||||||||||
Cash
and cash equivalents
|
12 | 28 | 4 | |||||||||
Other
current assets
|
146,339 | 293,179 | 42,944 | |||||||||
Investments
in subsidiaries
|
147,762 | 409 | 60 | |||||||||
Total
assets
|
294,513 | 293,617 | 43,008 | |||||||||
Current
liabilities
|
31,205 | 36,514 | 5,348 | |||||||||
Total
shareholders’ equity
|
263,307 | 257,103 | 37,660 | |||||||||
Total
liabilities and shareholders’ equity
|
294,513 | 293,617 | 43,008 |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Interest
income/ (expenses)
|
91 | (15 | ) | - | - | |||||||||||
General
and administrative expenses
|
(5,984 | ) | (11,404 | ) | (4,974 | ) | (729 | ) | ||||||||
Loss
before equity in undistributed
|
||||||||||||||||
Earnings
of subsidiaries
|
- | (11,419 | ) | (4,974 | ) | (729 | ) | |||||||||
Equity
in earnings of subsidiaries
|
- | 31,668 | (13,989 | ) | (2,049 | ) | ||||||||||
Net
income
|
(5,983 | ) | (20,248 | ) | (18,963 | ) | (2,778 | ) |
2007
|
2008
|
2009
|
||||||||||||||
RMB
|
RMB
|
RMB
|
US$
|
|||||||||||||
Cash
flow from operating activities
|
||||||||||||||||
Net
income
|
(5,893 | ) | 18,157 | (18,963 | ) | (2,778 | ) | |||||||||
Adjustment
to reconcile net income to net cash from operating activities:
|
||||||||||||||||
-
Equity in earnings of subsidiaries
|
- | (29,576 | ) | 13,975 | 2,047 | |||||||||||
-
Foreign exchange gain
|
- | - | - | - | ||||||||||||
Changes
in operating assets and liabilities:
|
||||||||||||||||
-
Other current assets
|
9,631 | 1,144 | (41 | ) | (6 | ) | ||||||||||
-
Other current liabilities
|
(3,713 | ) | - | 1,153 | 169 | |||||||||||
Net
cash provided by operating activities
|
25 | (10,275 | ) | (3,877 | ) | (568 | ) | |||||||||
Cash
flow from financing activities
|
||||||||||||||||
Payments
to related parties
|
(232,656 | ) | 10,113 | 4,306 | 631 | |||||||||||
Proceeds
from related parties
|
- | - | (412 | ) | (60 | ) | ||||||||||
Effect
of exchange
|
(8,273 | ) | 100 | (0.1 | ) | (0.02 | ) | |||||||||
Net
cash provided by/(used in) financing activities
|
(240,929 | ) | 10,213 | 3,893 | 570 | |||||||||||
Net
increase/(decrease) in cash
|
(240,904 | ) | 62 | 16 | 2 | |||||||||||
Cash:
|
||||||||||||||||
At
beginning of year
|
240,978 | 74 | 12 | 2 | ||||||||||||
At
end of year
|
74 | 12 | 28 | 4 |
Quarter Ended
|
Mar. 31
|
Jun. 30
|
Sept. 30
|
Dec. 31
|
Total
|
|||||||||||||||||||||||||||||||||||
Fiscal year
2009
|
RMB
|
US$
|
RMB
|
US$
|
RMB
|
US$
|
RMB
|
US$
|
RMB
|
US$
|
||||||||||||||||||||||||||||||
Revenue
|
74,517 | 10,885 | 72,571 | 10,624 | 89,603 | 13,126 | 84,040 | 12,310 | 320,731 | 46,945 | ||||||||||||||||||||||||||||||
Gross
profit
|
73 | 11 | 6,274 | 919 | 7,854 | 1,150 | 10,412 | 1, 525 | 24,613 | 3, 605 | ||||||||||||||||||||||||||||||
Net
income
|
(14,136 | ) | (2,065 | ) | (7,374 | ) | (1,079 | ) | 2,018 | 296 | 528 | 77 | (18,963 | ) | (2,778 | ) | ||||||||||||||||||||||||
Basic
and diluted earnings per share
|
(1.08 | ) | (0.16 | ) | (0.56 | ) | (0.08 | ) | 0.15 | 0.02 | 0.04 | 0.01 | (1.45 | ) | (0.21 | ) |
Borrower:
|
Fuwei Films (Shandong)
Co., Ltd.
|
Legal
Representative:
|
Xiaoan
He
|
Legal
Address:
|
Hi-Tech
Development Zone, Dong Ming Road, Weifang
|
Correspondence
Address:
|
Same as
above
|
Lender:
|
Weifang
Branch, Bank of Communication
|
Responsible
Person:
|
Lei
Wang
|
Correspondence
Address:
|
358
Dong Fang, Dong Street, Weifang
|
1
|
Loan
|
1.1
|
Currency:
Renminbi (RMB)
|
1.2
|
Amount:
70,000,000
|
1.3
|
The
proceeds of the Loan under this Contract shall be used for industrial
working capital.
|
1.4
|
Loan
Period: Commencing from June 9, 2009, to June 8,
2010.
|
2
|
Interest
Rate and Computation of Interest
|
2.1
|
Interest
rate: The annul interest rate is 5.841%(√
□
annually
□
monthly).
|
2.2
|
Computation of
Interest
|
2.2.1
|
Normal
interest = interest rate under this Contract X proceeds of the Loan X
number of days of use. Number of days of use is calculated from
the drawing date to the maturity
date.
|
2.2.2
|
The
penalty interest of the overdue loan and appropriated loan is calculated
based on the amount and the actual number of days overdue or appropriated.
If the currency of the loan is Renminbi (RMB), the overdue penalty
interest rate is equal to the loan interest rate set forth in this
Contract plus 50% of such loan’s interest rate, and the appropriated
penalty interest rate is equal to the loan interest rate set forth in this
Contract plus 100% of such loan interest rate. If the currency of the loan
is a foreign currency, the aforesaid penalty interest rates are equal to
the loan interest rate set forth in this Contract plus 20% of such loan
interest rate.
|
2.3
|
The
loan under this Contract uses the second (2
nd
)
method mentioned below for payment of interest. On the maturity date, the
interest shall be paid together with the principal. The date of payment of
interest is the date of the settlement of
interest:
|
|
1.
|
Interest
settlement on the 20
th
day of the last month of each quarter;
or
|
|
2.
|
Interest
settlement on the 20
th
day of each month.
|
3
|
Granting
and Repayment of Loan
|
3.1
|
Borrower
shall start the related procedure three (3) business days prior to drawing
the proceeds of the Loan in accordance with the following loan drawing
schedule: (N/A)
|
Drawing
Date
|
Drawing
Amount
|
3.2
|
Unless
all of the following conditions are satisfied, Lender has the right to
refuse to grant the Loan:
|
|
1.
|
Borrower
has already completed the statutory procedures including obtaining related
permit, approval and registration from the government and such permit,
approval and registration remain in full force and
effect.
|
|
2.
|
The
guarantee contract (if any) under this Contract has come into effect and
remains in full force and effect.
|
|
3.
|
The
financial condition of the Borrower does not have any substantial adverse
changes; and
|
|
4.
|
Borrower
is not in breach of this Contract.
|
3.3
|
The
actual drawing date and drawing amount shall be in accordance with the
promissory note.
|
3.4
|
Borrower
shall not repay the Loan prior to the scheduled date without having a
written consent from Lender.
|
4
|
Representation
and Guarantee of the Borrower
|
4.1
|
Borrower
is an independent entity and has the necessary contractual capacity to
perform this Contract and will be liable for its non-performance of its
obligations hereunder.
|
4.2
|
The
execution and performance of this Contract is the true intention of the
Borrower, and the Borrower has all necessary consents, approvals and
authorizations to perform its obligations.
|
4.3
|
All
the documents, reports, data and information provided by the Borrower to
the Lender during the execution and performance of this Contract are true,
accurate, complete and in full effect, and Borrower has not withheld any
information which may affect the evaluation of its financial status and
repayment ability.
|
5
|
Rights
and Obligations of Lender
|
5.1
|
Lender
has the right to be repaid the principal, receive interest (including
compound, overdue and appropriated penalty interest) and the necessary
expenses from the Borrower in accordance with this Contract. Lender has
the right to exercise any other rights under the relevant laws and
regulations or stipulated in this Contract.
|
5.2
|
Except
as otherwise specified under this contract, Lender shall keep all the
financial and operation data and information confidential unless compelled
by requirements of applicable laws and regulations.
|
6
|
Rights
and Obligations of Borrower
|
6.1
|
Borrower
shall repay the Loan under this Contract and pay the interest hereunder in
accordance with the date, amount, currency set forth in this
Contract.
|
6.2
|
Borrower
shall not use the proceeds of the Loan for any usage not stipulated in
this Contract.
|
6.3
|
Borrower
shall be liable for the expenses under this Contract, including but not
limited to, expenses for notary service, authentication, evaluation and
registration.
|
6.4
|
Borrower
shall comply with the operation procedure and the general practice of the
Lender and loan application, including but not limited to, facilitating
Lender’s examination and supervision on Borrower’s operation status, and
providing all the financial statements, or any other data and information
requested by Lender, and shall guarantee that such documents, data and
information are true, complete and accurate.
|
6.5
|
If
any one of the following events occurs, Borrower shall notify the Lender
within thirty (30) days and shall not commence such activities unless the
Loan and interest under this Contract are repaid completely, or a
repayment schedule and guarantee are approved and accepted by the Lender.
These are as follows:
|
|
1.
|
Selling,
donating, renting, lending, assigning, mortgaging, pledging or disposing
of all or substantial part of its assets.
|
|
2.
|
Any
substantial changes in organization or structure of the Borrower,
including but not limited to, its operation, subcontracting, lease,
affiliation, company restructuring, joint-stock, merger (consolidation),
equity joint-venture (non-equity), spin-off, incorporation of subsidiary,
asset assignment, reduction of registered capital, etc.
|
6.6
|
Borrower
shall notify the Lender within seven (7) days of occurrence of any of the
following events:
|
|
1.
|
Amendment
of the Articles of Association, change of Borrower’s name, change of legal
representative , change of domicile, change of address, and change in the
scope of its business.
|
|
2.
|
Borrower
or Guarantor’s (if any) intention to file for
bankruptcy.
|
|
3.
|
Borrower’s
involvement in any major litigation or arbitration, or any lien or
encumbrance is imposed on its assets.
|
|
4.
|
Borrower’s
guarantee to any other third party, which will have an adverse effect on
its financial status and ability to perform its obligations under this
Contract.
|
|
5.
|
Borrower
enters into a contract which will have a material adverse effect on its
operation and financial status.
|
|
6.
|
Borrower
or Guarantor (if any) stops its operation, its business terminates or its
business license is revoked.
|
|
7.
|
Borrower’s
legal representative or senior management has committed a criminal
offence.
|
|
8.
|
Borrower
faces substantial hardship in managing its business or any other event
which will have an adverse effect on the financial status or ability of
the Borrower to repay the Loan.
|
6.7
|
Any
changes to the form of collateral under this Contract that may have
adverse effect on Lender’s right shall be made upon Lender’s
consent.
|
7
|
Maturity
Repayment of the Loan before the Maturity Date
|
7.1
|
In
the event of the occurrence of any of the following events, Lender has the
right to suspend the drawing of the proceeds of the Loan and require
repayment of the principal of the Loan partially or completely before the
maturity date and demand that the Borrower repay the principal of the Loan
and pay the interest hereunder. These are as follows:
|
|
1.
|
Borrower’s
representations and warranties in Section 4 are not
true;
|
|
2.
|
Borrower
is in breach of this Contract;
|
|
3.
|
The
events set forth in Section 6.6 have occurred and Lender believes that
such event will have a material adverse effect on its rights as a
creditor; or
|
|
4.
|
Borrower
has delayed its performance or is in breach of other contracts entered
into between Borrower and Lender, and has not provided the Lender with any
remedy upon notification by Lender.
|
8
|
Breach
of Contract
|
8.1
|
In
the event that Borrower fails to repay the principal or interest in full
in a timely fashion, or to use the proceeds of the Loan as set forth in
this Contract, Lender has the right to use the overdue penalty interest
rate and appropriate penalty interest rate to calculate the
interest.
|
8.2
|
In
the event that Borrower fails to repay the principal or interest in full
in a timely fashion, Borrower shall be liable for the Lender’s expenses in
exercising its creditor’s rights, including litigation cost (arbitration
fee), costs of preservation of asset, costs of publication, enforcement
costs, legal fees, travel and other
expenses.
|
8.3
|
In
the event that Borrower avoids Lender’s supervision, fails to repay the
principal or the interest of the Loan or avoids the repayment
intentionally, Lender has the right to inform relevant government
authority and to publish the payment notification in the news
media.
|
9
|
Withdrawal
Instruction
|
9.1
|
In
the event that Borrower is overdue in payment in respect of principal,
interest, penalty interest, compound interest or other expenses, Lender is
authorized to withdraw the money from any other bank accounts of Borrower
with Bank of Communication to setoff the said outstanding
payment.
|
9.2
|
After
the aforesaid withdrawal, Lender shall inform the Borrower of such account
number, loan contract reference number, promissory note reference number,
amount of withdrawal, and the outstanding Loan amount.
|
9.3
|
If
the amount of withdrawal is not sufficient to setoff the aforesaid
payment, the overdue expenses shall be settled first. If the principal and
interest are overdue for less than ninety (90) days, the remaining balance
shall be first used to settle the overdue interest, penalty interest and
compound interest, then shall be used to settle the overdue principal. In
the event that the overdue payment or interest is overdue for more than
ninety (90) days, the remaining balance shall be used to settle the
overdue principal, then shall be used to settle the overdue interest,
penalty interest or compound interest.
|
9.4
|
If
the currency of the aforesaid withdrawal amount is different from the
currency of the Loan, the exchange rate determined by Bank of
Communication on the date of withdrawal shall be used for the currency
conversion calculation.
|
10
|
Dispute
Resolution
|
10.1
|
Any
dispute arising from or in connection with this Contract shall be resolved
by the first method listed below:
|
|
|
1.
|
File
a lawsuit to the competent court in the place where Lender is located;
or
|
|
2.
|
Submit
the disputes to _____________________ arbitration committee for
arbitration in accordance with the currently effective arbitration rules
of such committee. The arbitral award is final and is legally binding upon
both Parties.
|
11
|
Miscellaneous
|
11.1
|
This
Contract comes into effect upon both Parties’ execution of this
contract.
|
|
11.2
|
This
Contract is executed in five (5) counterparts. Each of the Parties and
Guarantor shall keep one counterpart.
|
Borrower:
|
Fuwei Films (Shandong)
Co., Ltd.
|
Legal
Representative:
|
Xiaoan
He
|
Legal
Address:
|
Hi-Tech
Development Zone, Dong Ming Road, Weifang
|
Correspondence
Address:
|
Same as
above
|
Lender:
|
Weifang
Branch, Bank of Communication
|
Responsible
Person:
|
Lei
Wang
|
Correspondence
Address:
|
358
Dong Fang, Dong Street, Weifang
|
1
|
Loan
|
1.1
|
Currency:
Renminbi (RMB)
|
1.2
|
Amount:
70,000,000
|
1.3
|
The
proceeds of the Loan under this Contract shall be used for industrial
working capital.
|
1.4
|
Loan
Period: Commencing from June 9, 2009, to June 8,
2010.
|
2
|
Interest
Rate and Computation of Interest
|
2.1
|
Interest
rate: The annul interest rate is 5.841%(
√
□
annually
□
monthly).
|
2.2
|
Computation of
Interest
|
2.2.1
|
Normal
interest = interest rate under this Contract X proceeds of the Loan X
number of days of use. Number of days of use is calculated from
the drawing date to the maturity
date.
|
2.2.2
|
The
penalty interest of the overdue loan and appropriated loan is calculated
based on the amount and the actual number of days overdue or appropriated.
If the currency of the loan is Renminbi (RMB), the overdue penalty
interest rate is equal to the loan interest rate set forth in this
Contract plus 50% of such loan’s interest rate, and the appropriated
penalty interest rate is equal to the loan interest rate set forth in this
Contract plus 100% of such loan interest rate. If the currency of the loan
is a foreign currency, the aforesaid penalty interest rates are equal to
the loan interest rate set forth in this Contract plus 20% of such loan
interest rate.
|
2.3
|
The
loan under this Contract uses the second (2
nd
)
method mentioned below for payment of interest. On the maturity date, the
interest shall be paid together with the principal. The date of payment of
interest is the date of the settlement of interest:
|
|
1.
|
Interest
settlement on the 20
th
day of the last month of each quarter; or
|
|
2.
|
Interest
settlement on the 20
th
day of each month.
|
3
|
Granting
and Repayment of Loan
|
3.1
|
Borrower
shall start the related procedure three (3) business days prior to drawing
the proceeds of the Loan in accordance with the following loan drawing
schedule: (N/A)
|
Drawing
Date
|
Drawing
Amount
|
3.2
|
Unless
all of the following conditions are satisfied, Lender has the right to
refuse to grant the Loan:
|
|
1.
|
Borrower
has already completed the statutory procedures including obtaining related
permit, approval and registration from the government and such permit,
approval and registration remain in full force and
effect.
|
|
2.
|
The
guarantee contract (if any) under this Contract has come into effect and
remains in full force and effect.
|
|
3.
|
The
financial condition of the Borrower does not have any substantial adverse
changes; and
|
|
4.
|
Borrower
is not in breach of this Contract.
|
3.3
|
The
actual drawing date and drawing amount shall be in accordance with the
promissory note.
|
3.4
|
Borrower
shall not repay the Loan prior to the scheduled date without having a
written consent from Lender.
|
4
|
Representation
and Guarantee of the Borrower
|
4.1
|
Borrower
is an independent entity and has the necessary contractual capacity to
perform this Contract and will be liable for its non-performance of its
obligations hereunder.
|
4.2
|
The
execution and performance of this Contract is the true intention of the
Borrower, and the Borrower has all necessary consents, approvals and
authorizations to perform its obligations.
|
4.3
|
All
the documents, reports, data and information provided by the Borrower to
the Lender during the execution and performance of this Contract are true,
accurate, complete and in full effect, and Borrower has not withheld any
information which may affect the evaluation of its financial status and
repayment ability.
|
5
|
Rights
and Obligations of Lender
|
5.1
|
Lender
has the right to be repaid the principal, receive interest (including
compound, overdue and appropriated penalty interest) and the necessary
expenses from the Borrower in accordance with this Contract. Lender has
the right to exercise any other rights under the relevant laws and
regulations or stipulated in this Contract.
|
5.2
|
Except
as otherwise specified under this contract, Lender shall keep all the
financial and operation data and information confidential unless compelled
by requirements of applicable laws and regulations.
|
6
|
Rights
and Obligations of Borrower
|
6.1
|
Borrower
shall repay the Loan under this Contract and pay the interest hereunder in
accordance with the date, amount, currency set forth in this
Contract.
|
6.2
|
Borrower
shall not use the proceeds of the Loan for any usage not stipulated in
this Contract.
|
6.3
|
Borrower
shall be liable for the expenses under this Contract, including but not
limited to, expenses for notary service, authentication, evaluation and
registration.
|
6.4
|
Borrower
shall comply with the operation procedure and the general practice of the
Lender and loan application, including but not limited to, facilitating
Lender’s examination and supervision on Borrower’s operation status, and
providing all the financial statements, or any other data and information
requested by Lender, and shall guarantee that such documents, data and
information are true, complete and
accurate.
|
6.5
|
If
any one of the following events occurs, Borrower shall notify the Lender
within thirty (30) days and shall not commence such activities unless the
Loan and interest under this Contract are repaid completely, or a
repayment schedule and guarantee are approved and accepted by the Lender.
These are as follows:
|
|
1.
|
Selling,
donating, renting, lending, assigning, mortgaging, pledging or disposing
of all or substantial part of its assets.
|
|
2.
|
Any
substantial changes in organization or structure of the Borrower,
including but not limited to, its operation, subcontracting, lease,
affiliation, company restructuring, joint-stock, merger (consolidation),
equity joint-venture (non-equity), spin-off, incorporation of subsidiary,
asset assignment, reduction of registered capital, etc.
|
6.6
|
Borrower
shall notify the Lender within seven (7) days of occurrence of any of the
following events:
|
|
1.
|
Amendment
of the Articles of Association, change of Borrower’s name, change of legal
representative , change of domicile, change of address, and change in the
scope of its business.
|
|
2.
|
Borrower
or Guarantor’s (if any) intention to file for
bankruptcy.
|
|
3.
|
Borrower’s
involvement in any major litigation or arbitration, or any lien or
encumbrance is imposed on its assets.
|
|
4.
|
Borrower’s
guarantee to any other third party, which will have an adverse effect on
its financial status and ability to perform its obligations under this
Contract.
|
|
5.
|
Borrower
enters into a contract which will have a material adverse effect on its
operation and financial status.
|
|
6.
|
Borrower
or Guarantor (if any) stops its operation, its business terminates or its
business license is revoked.
|
|
7.
|
Borrower’s
legal representative or senior management has committed a criminal
offence.
|
|
8.
|
Borrower
faces substantial hardship in managing its business or any other event
which will have an adverse effect on the financial status or ability of
the Borrower to repay the Loan.
|
6.7
|
Any
changes to the form of collateral under this Contract that may have
adverse effect on Lender’s right shall be made upon Lender’s
consent.
|
7
|
Maturity
Repayment of the Loan before the Maturity Date
|
7.1
|
In
the event of the occurrence of any of the following events, Lender has the
right to suspend the drawing of the proceeds of the Loan and require
repayment of the principal of the Loan partially or completely before the
maturity date and demand that the Borrower repay the principal of the Loan
and pay the interest hereunder. These are as follows:
|
|
1.
|
Borrower’s
representations and warranties in Section 4 are not
true;
|
|
2.
|
Borrower
is in breach of this Contract;
|
|
3.
|
The
events set forth in Section 6.6 have occurred and Lender believes that
such event will have a material adverse effect on its rights as a
creditor; or
|
|
4.
|
Borrower
has delayed its performance or is in breach of other contracts entered
into between Borrower and Lender, and has not provided the Lender with any
remedy upon notification by Lender.
|
8
|
Breach
of Contract
|
8.1
|
In
the event that Borrower fails to repay the principal or interest in full
in a timely fashion, or to use the proceeds of the Loan as set forth in
this Contract, Lender has the right to use the overdue penalty interest
rate and appropriate penalty interest rate to calculate the
interest.
|
8.2
|
In
the event that Borrower fails to repay the principal or interest in full
in a timely fashion, Borrower shall be liable for the Lender’s expenses in
exercising its creditor’s rights, including litigation cost (arbitration
fee), costs of preservation of asset, costs of publication, enforcement
costs, legal fees, travel and other
expenses.
|
8.3
|
In
the event that Borrower avoids Lender’s supervision, fails to repay the
principal or the interest of the Loan or avoids the repayment
intentionally, Lender has the right to inform relevant government
authority and to publish the payment notification in the news
media.
|
9
|
Withdrawal
Instruction
|
9.1
|
In
the event that Borrower is overdue in payment in respect of principal,
interest, penalty interest, compound interest or other expenses, Lender is
authorized to withdraw the money from any other bank accounts of Borrower
with Bank of Communication to setoff the said outstanding
payment.
|
9.2
|
After
the aforesaid withdrawal, Lender shall inform the Borrower of such account
number, loan contract reference number, promissory note reference number,
amount of withdrawal, and the outstanding Loan amount.
|
9.3
|
If
the amount of withdrawal is not sufficient to setoff the aforesaid
payment, the overdue expenses shall be settled first. If the principal and
interest are overdue for less than ninety (90) days, the remaining balance
shall be first used to settle the overdue interest, penalty interest and
compound interest, then shall be used to settle the overdue principal. In
the event that the overdue payment or interest is overdue for more than
ninety (90) days, the remaining balance shall be used to settle the
overdue principal, then shall be used to settle the overdue interest,
penalty interest or compound interest.
|
9.4
|
If
the currency of the aforesaid withdrawal amount is different from the
currency of the Loan, the exchange rate determined by Bank of
Communication on the date of withdrawal shall be used for the currency
conversion calculation.
|
10
|
Dispute
Resolution
|
10.1
|
Any
dispute arising from or in connection with this Contract shall be resolved
by the first method listed below:
|
|
1.
|
File
a lawsuit to the competent court in the place where Lender is located;
or
|
|
2.
|
Submit
the disputes to _____________________ arbitration committee for
arbitration in accordance with the currently effective arbitration rules
of such committee. The arbitral award is final and is legally binding upon
both Parties.
|
11
|
Miscellaneous
|
11.1
|
This
Contract comes into effect upon both Parties’ execution of this
contract.
|
|
11.2
|
This
Contract
is executed in five (5) counterparts. Each of the Parties and Guarantor
shall keep one
counterpart.
|
June
9, 2009
|
June
9, 2009
|
Borrower
(seal):
|
Lender
(seal):
|
Fuwei
Films (Shandong) Co., Ltd.
|
Bank
of Communication
|
Legal
Representative or Authorized Person
|
Responsible
Person or Authorized Person
|
Xiaoan
He
|
Lei
Wang
|
(signature
or seal)
|
(signature
or seal)
|
Borrower:
|
Fuwei Films (Shandong)
Co., Ltd.
|
Legal
Representative:
|
Xiaoan
He
|
Lender:
|
Weifang
Dongfang State-owned Assets Management Co., Ltd.
|
Responsible
Person:
|
Pizong
Mou
|
Guarantor:
|
Shandong
Deqin Investment& Guarantee Co.,
Ltd.
|
1
|
Loan
|
1.1
|
Currency:
Renminbi (RMB)
|
1.2
|
Amount:
10,000,000
|
1.3
|
The
proceeds of the Loan under this Contract shall be used for project
investment.
|
1.4
|
Loan
Period: Commencing from October 19, 2009, to October 18,
2017.
|
Granting
Date
|
Expired
Date
|
||||||
Year
|
Month
|
Day
|
Amount
|
Year
|
Month
|
Day
|
Amount
|
2009
|
10
|
19
|
10,000,000.00
|
2015
|
4
|
18
|
1675000
|
2015
|
10
|
18
|
1675000
|
||||
2016
|
4
|
18
|
1675000
|
||||
2016
|
10
|
18
|
1675000
|
||||
2017
|
4
|
18
|
1675000
|
||||
2017
|
10
|
18
|
1625000
|
2
|
Interest
Rate and Computation of Interest
|
2.1
|
Interest
rate: The annul interest rate is 5.346%, up by 10% compared the fixed
benchmark interest rate announced by the People’s Bank of China. Interest
for Loans for less than 5 years is the same as the period benchmark
interest of People’s Bank of China. For more than 5 years the
interest is benchmark interest rate announced by the People’s Bank of
China plus
0%.
The cycle for interest is 6 months.
|
2.2
|
Computation of
Interest
|
3
|
Granting
and Repayment of Loan
|
3.1
|
Unless
all of the following conditions are satisfied, Lender has the right to
refuse to grant the Loan:
|
|
1.
|
Borrower
has already completed the statutory procedures including obtaining related
permit, approval and registration from the government and such permit,
approval and registration remain in full force and
effect.
|
|
2.
|
The
guarantee contract (if any) under this Contract has come into effect and
remains in full force and effect.
|
|
3.
|
The
financial condition of the Borrower does not have any substantial adverse
changes; and
|
|
4.
|
Borrower
is not in breach of this Contract.
|
3.2
|
The
actual drawing date and drawing amount shall be in accordance with the
promissory note.
|
3.3
|
Borrower
shall not repay the Loan prior to the scheduled date without having a
written consent from Lender.
|
4.
|
Rights
and Obligations of Guarantor
|
4.1.
|
Borrower
engages Shandong Deqin Investment& Guarantee Co., Ltd. as a guarantee
company. According to the investigation of Lender, the
Guarantor is capable and qualified to repay the loan. The
Guarantor has the right to examine and supervise the Borrower to implement
the contract.
|
4.2.
|
If
Borrower can’t fulfill its obligation, the Guarantor should repay the
principle and assume the breach
liabilities.
|
4.3.
|
The
Guarantee includes major right of credit, penalty, compensation and fees
for realizing creditor’s rights.
|
5.
|
Rights
and Obligations of Lender
|
5.1
|
Lender
has the right to be repaid the principal, receive interest (including
compound, overdue and appropriated penalty interest) and the necessary
expenses from the Borrower in accordance with this Contract. Lender has
the right to exercise any other rights under the relevant laws and
regulations or stipulated in this
Contract.
|
5.2
|
Except
as otherwise specified under this contract, Lender shall keep all the
financial and operation data and information confidential unless compelled
by requirements of applicable laws and
regulations.
|
6.
|
Rights
and Obligations of Borrower
|
6.1
|
Borrower
shall repay the Loan under this Contract and pay the interest
hereunder in accordance with the date, amount, currency set forth in
this Contract.
|
6.2
|
Borrower
shall not use the proceeds of the Loan for any usage not stipulated in
this Contract.
|
6.3
|
Borrower
shall be liable for the expenses under this Contract, including but not
limited to, expenses for notary service, authentication, evaluation and
registration.
|
6.4
|
Borrower
shall comply with the operation procedure and the general practice of
the Lender and loan application, including but not
limited to, facilitating Lender’s examination and supervision
on Borrower’s operation status, and providing all the financial
statements, or any other data and information requested by Lender, and
shall guarantee that such documents, data and information are true,
complete and accurate.
|
6.5
|
If
any one of the following events occurs, Borrower shall notify the Lender
within thirty (30) days and shall not commence such activities unless the
Loan and interest under this Contract are repaid completely, or a
repayment schedule and guarantee are approved and accepted by the Lender.
These are as follows:
|
|
1.
|
Selling,
donating, renting, lending, assigning, mortgaging, pledging or disposing
of all or substantial part of its assets.
|
|
2.
|
Any
substantial changes in organization or structure of the Borrower,
including but not limited to, its operation, subcontracting, lease,
affiliation, company restructuring, joint-stock, merger (consolidation),
equity joint-venture (non-equity), spin-off, incorporation of subsidiary,
asset assignment, reduction of registered capital,
etc.
|
6.6
|
Borrower
shall notify the Lender within seven (7) days of occurrence of any of the
following events:
|
|
1.
|
Amendment
of the Articles of Association, change of Borrower’s name, change of legal
representative , change of domicile, change of address, and change in the
scope of its business.
|
|
2.
|
Borrower
or Guarantor’s (if any) intention to file for
bankruptcy.
|
|
3.
|
Borrower’s
involvement in any major litigation or arbitration, or any lien or
encumbrance is imposed on its
assets.
|
|
4.
|
Borrower’s
guarantee to any other third party, which will have an adverse effect on
its financial status and ability to perform its obligations under this
Contract.
|
|
5.
|
Borrower
enters into a contract which will have a material adverse effect on its
operation and financial status.
|
|
6.
|
Borrower
or Guarantor (if any) stops its operation, its business terminates or its
business license is revoked.
|
|
7.
|
Borrower’s
legal representative or senior management has committed a criminal
offence.
|
|
8.
|
Borrower
faces substantial hardship in managing its business or any other event
which will have an adverse effect on the financial status or ability of
the Borrower to repay the Loan.
|
6.7
|
Any
changes to the form of collateral under this Contract that may have
adverse effect on Lender’s right shall be made upon Lender’s
consent.
|
7.
|
Breach
of Contract
|
7.1
|
In
the event that Borrower fails to repay the principal or interest in full
in a timely fashion, or to use the
proceeds of the Loan as set forth in this Contract, Lender has the right
to use the overdue penalty interest rate and appropriate penalty interest
rate to calculate the interest.
|
7.2
|
In
the event that Borrower fails to repay the principal or interest in full
in a timely fashion, Borrower shall be liable for the Lender’s expenses in
exercising its creditor’s rights, including litigation cost (arbitration
fee), costs of preservation of asset, costs of publication, enforcement
costs, legal fees, travel and other
expenses.
|
7.3
|
In
the event that Borrower avoids Lender’s supervision, fails to repay the
principal or the interest of the Loan or avoids the repayment
intentionally, Lender has the right to inform relevant government
authority and to publish the payment notification in the news
media.
|
8.
|
Dispute
Resolution
|
|
1.
|
File
a lawsuit to the competent court in the place where Lender is located;
or
|
|
2.
|
Submit
the disputes to _____________________ arbitration committee for
arbitration in accordance with the currently effective arbitration rules
of such committee. The arbitral award is final and is legally binding upon
both Parties.
|
9.
|
Miscellaneous
|
9.1
|
This
Contract comes into effect upon both Parties’ execution of this
contract.
|
9.2
|
This
Contract is executed in six (6) counterparts. Each of the Parties and
Guarantor shall keep one
counterpart.
|
November
20, 2009
|
November
20, 2009
|
Borrower
(seal):
|
Lender
(seal):
|
Fuwei
Films (Shandong) Co., Ltd.
|
Weifang
Dongfang State-owned Assets Management Co., Ltd..
|
Legal
Representative or Authorized Person
|
Responsible
Person or Authorized Person
|
Xiaoan
He
|
Pizong
Mou
|
(signature
or seal)
|
(signature
or seal)
|
Contract No.:
No. 0012 Jiezi 0900 Bank of Weifang
2010
|
Borrower:
|
Fuwei Films (Shandong)
Co., Ltd.
|
Legal
Representative:
|
Xiaoan
He
|
Legal
Address:
|
Hi-Tech
Development Zone, Dong Ming Road, Weifang
|
Correspondence
Address:
|
Same as
above
|
Account No.: | 0900012090049085 |
Lender:
|
Bank
of Weifang
|
Responsible
Person:
|
Yuzhi
Wang
|
Correspondence
Address:
|
336
Dong Fang Road, Weifang,
Shandong
|
1
|
Loan
|
1.1
|
Currency:
Renminbi (RMB)
|
1.2
|
Amount:
10,000,000
|
1.3
|
The
proceeds of the Loan under this Contract shall be used for Research &
Development of Special BOPET films
|
1.4
|
Loan
Period: Commencing from January 13, 2010, to January 12,
2012.
|
2
|
Interest
Rate and Computation of Interest
|
2.1
|
Interest
rate: free
|
2.2
|
Computation of
Interest
|
2.2.1
|
Normal
interest = interest rate under this Contract X proceeds of the Loan X
number of days of use. Number of days of use is calculated from
the drawing date to the maturity
date.
|
2.2.2
|
The
penalty interest of the overdue loan and appropriated loan is calculated
based on the amount and the actual number of days overdue or appropriated.
If the currency of the loan is Renminbi (RMB), the overdue penalty
interest rate is equal to the loan interest rate set forth in this
Contract plus 50% of such loan’s interest rate, and the appropriated
penalty interest rate is equal to the loan interest rate set forth in this
Contract plus 100% of such loan interest rate. If the currency of the loan
is a foreign currency, the aforesaid penalty interest rates are equal to
the loan interest rate set forth in this Contract plus 20% of such loan
interest rate.
|
2.3
|
The
loan under this Contract uses the second (2
nd
)
method mentioned below for payment of interest. On the maturity date, the
interest shall be paid together with the principal. The date of payment of
interest is the date of the settlement of interest:
|
|
1.
|
Interest
settlement on the 20
th
day of the last month of each quarter; or
|
|
2.
|
Interest
settlement on the 20
th
day of each month.
|
3
|
Granting
and Repayment of Loan
|
3.1
|
Borrower
shall start the related procedure three (3) business days prior to drawing
the proceeds of the Loan in accordance with the following loan drawing
schedule: (N/A)
|
Drawing
Date
|
Drawing
Amount
|
3.2
|
Unless
all of the following conditions are satisfied, Lender has the right to
refuse to grant the Loan:
|
|
1.
|
Borrower
has already completed the statutory procedures including obtaining related
permit, approval and registration from the government and such permit,
approval and registration remain in full force and
effect.
|
|
2.
|
The
guarantee contract (if any) under this Contract has come into effect and
remains in full force and effect.
|
|
3.
|
The
financial condition of the Borrower does not have any substantial adverse
changes; and
|
|
4.
|
Borrower
is not in breach of this Contract.
|
3.3
|
The
actual drawing date and drawing amount shall be in accordance with the
promissory note.
|
3.4
|
Borrower
shall not repay the Loan prior to the scheduled date without having a
written consent from Lender.
|
4
|
Representation
and Guarantee of the Borrower
|
4.1
|
Borrower
is an independent entity and has the necessary contractual capacity to
perform this Contract and will be liable for its non-performance of its
obligations hereunder.
|
4.2
|
The
execution and performance of this Contract is the true intention of the
Borrower, and the Borrower has all necessary consents, approvals and
authorizations to perform its obligations.
|
4.3
|
All
the documents, reports, data and information provided by the Borrower to
the Lender during the execution and performance of this Contract are true,
accurate, complete and in full effect, and Borrower has not withheld any
information which may affect the evaluation of its financial status and
repayment ability.
|
5
|
Rights
and Obligations of Lender
|
5.1
|
Lender
has the right to be repaid the principal, receive interest (including
compound, overdue and appropriated penalty interest) and the necessary
expenses from the Borrower in accordance with this Contract. Lender has
the right to exercise any other rights under the relevant laws and
regulations or stipulated in this Contract.
|
5.2
|
Except
as otherwise specified under this contract, Lender shall keep all the
financial and operation data and information confidential unless compelled
by requirements of applicable laws and regulations.
|
6
|
Rights
and Obligations of Borrower
|
6.1
|
Borrower
shall repay the Loan under this Contract and pay the interest hereunder in
accordance with the date, amount, currency set forth in this
Contract.
|
6.2
|
Borrower
shall not use the proceeds of the Loan for any usage not stipulated in
this Contract.
|
6.3
|
Borrower
shall be liable for the expenses under this Contract, including but not
limited to, expenses for notary service, authentication, evaluation and
registration.
|
6.4
|
Borrower
shall comply with the operation procedure and the general practice of the
Lender and loan application, including but not limited to, facilitating
Lender’s examination and supervision on Borrower’s operation status, and
providing all the financial statements, or any other data and information
requested by Lender, and shall guarantee that such documents, data and
information are true, complete and
accurate.
|
6.5
|
If
any one of the following events occurs, Borrower shall notify the Lender
within thirty (30) days and shall not commence such activities unless the
Loan and interest under this Contract are repaid completely, or a
repayment schedule and guarantee are approved and accepted by the Lender.
These are as follows:
|
|
1.
|
Selling,
donating, renting, lending, assigning, mortgaging, pledging or disposing
of all or substantial part of its assets.
|
|
2.
|
Any
substantial changes in organization or structure of the Borrower,
including but not limited to, its operation, subcontracting, lease,
affiliation, company restructuring, joint-stock, merger (consolidation),
equity joint-venture (non-equity), spin-off, incorporation of subsidiary,
asset assignment, reduction of registered capital, etc.
|
6.6
|
Borrower
shall notify the Lender within seven (7) days of occurrence of any of the
following events:
|
|
1.
|
Amendment
of the Articles of Association, change of Borrower’s name, change of legal
representative , change of domicile, change of address, and change in the
scope of its business.
|
|
2.
|
Borrower
or Guarantor’s (if any) intention to file for
bankruptcy.
|
|
3.
|
Borrower’s
involvement in any major litigation or arbitration, or any lien or
encumbrance is imposed on its assets.
|
|
4.
|
Borrower’s
guarantee to any other third party, which will have an adverse effect on
its financial status and ability to perform its obligations under this
Contract.
|
|
5.
|
Borrower
enters into a contract which will have a material adverse effect on its
operation and financial status.
|
|
6.
|
Borrower
or Guarantor (if any) stops its operation, its business terminates or its
business license is revoked.
|
|
7.
|
Borrower’s
legal representative or senior management has committed a criminal
offence.
|
|
8.
|
Borrower
faces substantial hardship in managing its business or any other event
which will have an adverse effect on the financial status or ability of
the Borrower to repay the Loan.
|
6.7
|
Any
changes to the form of collateral under this Contract that may have
adverse effect on Lender’s right shall be made upon Lender’s
consent.
|
7
|
Maturity
Repayment of the Loan before the Maturity Date
|
7.1
|
In
the event of the occurrence of any of the following events, Lender has the
right to suspend the drawing of the proceeds of the Loan and require
repayment of the principal of the Loan partially or completely before the
maturity date and demand that the Borrower repay the principal of the Loan
and pay the interest hereunder. These are as follows:
|
|
1.
|
Borrower’s
representations and warranties in Section 4 are not
true;
|
|
2.
|
Borrower
is in breach of this Contract;
|
|
3.
|
The
events set forth in Section 6.6 have occurred and Lender believes that
such event will have a material adverse effect on its rights as a
creditor; or
|
|
4.
|
Borrower
has delayed its performance or is in breach of other contracts entered
into between Borrower and Lender, and has not provided the Lender with any
remedy upon notification by Lender.
|
8
|
Breach
of Contract
|
8.1
|
In
the event that Borrower fails to repay the principal or interest in full
in a timely fashion, or to use the proceeds of the Loan as set forth in
this Contract, Lender has the right to use the overdue penalty interest
rate and appropriate penalty interest rate to calculate the
interest.
|
8.2
|
In
the event that Borrower fails to repay the principal or interest in full
in a timely fashion, Borrower shall be liable for the Lender’s expenses in
exercising its creditor’s rights, including litigation cost (arbitration
fee), costs of preservation of asset, costs of publication, enforcement
costs, legal fees, travel and other
expenses.
|
8.3
|
In
the event that Borrower avoids Lender’s supervision, fails to repay the
principal or the interest of the Loan or avoids the repayment
intentionally, Lender has the right to inform relevant government
authority and to publish the payment notification in the news
media.
|
9
|
Withdrawal
Instruction
|
9.1
|
In
the event that Borrower is overdue in payment in respect of principal,
interest, penalty interest, compound interest or other expenses, Lender is
authorized to withdraw the money from any other bank accounts of Borrower
with Bank of Communication to setoff the said outstanding
payment.
|
9.2
|
After
the aforesaid withdrawal, Lender shall inform the Borrower of such account
number, loan contract reference number, promissory note reference number,
amount of withdrawal, and the outstanding Loan amount.
|
9.3
|
If
the amount of withdrawal is not sufficient to setoff the aforesaid
payment, the overdue expenses shall be settled first. If the principal and
interest are overdue for less than ninety (90) days, the remaining balance
shall be first used to settle the overdue interest, penalty interest and
compound interest, then shall be used to settle the overdue principal. In
the event that the overdue payment or interest is overdue for more than
ninety (90) days, the remaining balance shall be used to settle the
overdue principal, then shall be used to settle the overdue interest,
penalty interest or compound interest.
|
9.4
|
If
the currency of the aforesaid withdrawal amount is different from the
currency of the Loan, the exchange rate determined by Bank of
Communication on the date of withdrawal shall be used for the currency
conversion calculation.
|
10
|
Dispute
Resolution
|
10.1
|
Any
dispute
arising from or in connection with this Contract shall be resolved by the
first method listed below:
|
|
1.
|
File
a lawsuit to the competent court in the place where Lender is located;
or
|
|
2.
|
Submit
the disputes to _____________________ arbitration committee for
arbitration in accordance with the currently effective arbitration rules
of such committee. The arbitral award is final and is legally binding upon
both Parties.
|
11
|
Miscellaneous
|
11.1
|
This
Contract comes into effect upon both Parties’ execution of this
contract.
|
11.2
|
This
Contract is executed in five (5) counterparts. Each of the Parties and
Guarantor shall keep one
counterpart.
|
January
13, 2010
|
January
13, 2010
|
Borrower
(seal):
|
Lender
(seal):
|
Fuwei
Films (Shandong) Co., Ltd.
|
Bank
of Weifang
|
Legal
Representative or Authorized Person
|
Responsible
Person or Authorized Person
|
Xiaoan
He
|
Yuzhi
Wang
|
(signature
or seal)
|
(signature
or seal)
|
1.
|
I
have reviewed this annual report on Form 20-F for the fiscal year ended
December 31, 2009 of Fuwei Films (Holdings) Co., Ltd. (the
“Registrant”);
|
2.
|
Based
on my knowledge, this annual report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
annual report;
|
3.
|
Based
on my knowledge, the financial statements and other financial information
included in this annual report fairly present in all material respects the
financial condition, results of operations and cash flows of the
Registrant as of, and for, the periods presented in this annual
report;
|
4.
|
The
Registrant’s other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and
15d-15(f)) for the Registrant and
have:
|
(a)
|
designed
such disclosure controls and procedures , or caused such disclosure
control and procedures to be designed under our supervision, to ensure
that material information relating to the Registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
|
(b)
|
designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
(c)
|
evaluated
the effectiveness of the Registrant’s disclosure controls and procedures
and presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this annual report based on such evaluation;
and
;
|
(d)
|
disclosed
in this annual report any change in the Registrant’s internal control over
financial reporting that occurred during the period covered by the annual
repoert that has materially affected, or is reasonablly likely to
materially affect, the Registrant’s internal control over financial
reporting; and;
|
5.
|
The
Registrant’s other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the Registrant’s auditors and the audit committee of the Registrant’s
board of directors (or persons performing the equivalent
function):
|
(a)
|
all
significant deficiencies and material weaknesses in the design or
operation of internal controls over financial reporting which are
reasonably likely to adversely affect the Registrant’s ability to record,
process, summarize and report financial data and have identified for the
Registrant’s auditors any material weaknesses in internal controls
information; and
|
(b)
|
any
fraud, whether or not material, that involves management or other
employees who have a significant role in the Registrant’s internal
controls over financial reporting.
|
/s/
Xiaoan He
|
|
Name:
Xiaoan He
Title:
Chief Executive Officer
|
1.
|
I
have reviewed this annual report on Form 20-F for the fiscal year ended
December 31, 2009 of Fuwei Films (Holdings) Co., Ltd. (the
“Registrant”);
|
2.
|
Based
on my knowledge, this annual report does not contain any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this
annual report;
|
3.
|
Based
on my knowledge, the financial statements and other financial information
included in this annual report fairly present in all material respects the
financial condition, results of operations and cash flows of the
Registrant as of, and for, the periods presented in this annual
report;
|
4.
|
The
Registrant’s other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-14 and 15d-14) and internal control over
financial reporting (as defined in Exchange Act Rules 13a-15(f) and
15d-15(f)) for the Registrant and
have:
|
(a)
|
designed
such disclosure controls and procedures , or caused such disclosure
control and procedures to be designed under our supervision, to ensure
that material information relating to the Registrant, including its
consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this annual report is
being prepared;
|
(b)
|
designed
such internal control over financial reporting, or caused such internal
control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting
principles;
|
(c)
|
evaluated
the effectiveness of the Registrant’s disclosure controls and procedures
and presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this annual report based on such evaluation;
and
|
(d)
|
disclosed
in this annual report any change in the Registrant’s internal control over
financial reporting that occurred during the period covered by the annual
repoert that has materially affected, or is reasonablly likely to
materially affect, the Registrant’s internal control over financial
reporting; and;
|
5.
|
The
Registrant’s other certifying officer and I have disclosed, based on our
most recent evaluation of internal control over financial reporting, to
the Registrant’s auditors and the audit committee of the Registrant’s
board of directors (or persons performing the equivalent
function):
|
(a)
|
all
significant deficiencies and material weaknesses in the design or
operation of internal controls over financial reporting which are
reasonably likely to adversely affect the Registrant’s ability to record,
process, summarize and report financial data and have identified for the
Registrant’s auditors any material weaknesses in internal controls
information; and
|
(b)
|
any
fraud, whether or not material, that involves management or other
employees who have a significant role in the Registrant’s internal
controls over financial reporting.
|
/s/
Xiuyong Zhang
|
|
Name:
Xiuyong Zhang
Title:
Chief Financial Officer
|
(1)
|
The
Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934;
and
|
(2)
|
The
information contained in the report fairly presents, in all material
respects, the financial condition and results of operations of the
Company.
|
/s/
Xiaoan He
|
|
Xiaoan
He
Chief
Executive Officer
|
/s/
Xiuyong Zhang
|
|
Xiuyong
Zhang
Chief
Financial Officer
|