Flat Glass Group Co., Ltd. — Capital/Financing Update 2021

Jan 21, 2021

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

福萊特玻璃集團股份有限公司 Flat Glass Group Co., Ltd.

(a joint stock company incorporated in the People’s Republic of China with limited liability) (Stock code: 6865)

INSIDE INFORMATION MAJOR PV GLASS SALES CONTRACT

This announcement is made by the Company pursuant to Rule 13.09 of the Listing Rules and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong).

The Board is pleased to announce that the Board has approved that, the Company and certain of its whollyowned subsidiaries as the Sellers and Risen and its subsidiaries and associated companies as the Purchasers entered into the Sales Contract on 21 January 2021 for the supply and sale of an aggregate of 34GW (approximately 234,000,000 square meters) of Photovoltaic Rolled Glass (for using in solar modules) from 1 January 2021 to 31 December 2023.

As the Sales Contract and the transactions contemplated under the Sales Contract are of a revenue nature in the ordinary and usual course of business of the Group under Rule 14.04(1)(g) of the Listing Rules, it does not constitute as a notifiable transaction for the Company under Chapter 14 of the Listing Rules.

Shareholders and potential investors of the Company should note that the Sales Contract is subject to certain conditions precedent. Furthermore, the effect on the performance of the Company depends on, among others, the actual quantity delivered, the actual price of the PV Glass under the specific purchaser orders signed by the parties and the revenue recognition under the China Accounting Standards for Business Enterprises. The Sales Contract may also be delayed, amended or terminated due to force majeure or any other reasons. Accordingly, Shareholders and potential investors of the Company shall exercise caution when dealing in the Shares of the Company.

INTRODUCTION

This announcement is made by the Company pursuant to Rule 13.09 of the Listing Rules and the Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong). This announcement sets out certain information from the overseas regulatory announcement for the information of the potential investors and Shareholders of the Company.

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The Board is pleased to announce that the Board has approved that, the Company and certain of its whollyowned subsidiaries as the Sellers and Risen and its subsidiaries and associated companies as the Purchasers entered into the Sales Contract on 21 January 2021 for the supply and sale of an aggregate of 34GW (approximately 234,000,000 square meters) of Photovoltaic Rolled Glass (for using in solar modules) from 1 January 2021 to 31 December 2023.

PRINCIPAL TERMS OF THE SALES CONTRACT

The principal terms of the Sales Contract are set out below:

• Date: 21 January 2021 Parties: (1) the Company, and Anhui Flat Glass, Zhejiang Jiafu, Flat (Vietnam) Company Limited and Flat (Hong Kong) Company Limited, each a wholly-owned subsidiary of the Company, as the Sellers

  • (2) Risen and Risen (Changzhou) Energy Co., Ltd.* (東方日升（常 州）新能源有限公司), Risen (Yiwu) Energy Co., Ltd.* (東方日 升（義烏）新能源有限公司), Risen (Anhui) Energy Co., Ltd.* (東方日升（安徽）新能源有限公司) and Risen (Ningbo) Energy Co., Ltd.* (東方日升（寧波）新能源有限公司), the subsidiaries and associated companies of Risen, as the Purchasers

• Duration: 1 January 2021 to 31 December 2023 Total sales quantity: An aggregate of 34GW (approximately 234,000,000 square meters) of Photovoltaic Rolled Glass (for using in solar modules)

• Estimated contract sum: Purchase price for glass of each and every specification shall be negotiated by both parties through friendly consultation on a win-win basis with reference to prevailing market prices. Taking into consideration the market penetration rate of the double-glass modules, and based on the average price of 3.2mm PV Glass as RMB42 per square meter (including tax) and the average price of 2.0mm PV Glass as RMB34 per square meter (including tax) as published by Sublime China Information Co., Ltd.* (卓創週報) dated 14 January 2021 in its weekly report, the Board estimated that the total sum will be approximately RMB8.908 billion (including tax).

Payment term: The Purchasers shall pay certain prepayment(s) to the Sellers in accordance with the Sales Contract, and that such prepayment(s) may be used to offset the payable(s). The Purchasers shall settle the balance of the contract price corresponding to the specific purchase order in accordance with such time and terms as agreed between both parties.

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Breach of contract:

If either party fails to perform in accordance with the terms agreed in the agreement, the defaulting party shall pay the corresponding liquidated damages as agreed in the agreement.

Conditions precedent:

The Sales Contract, after signed and sealed by both parties, shall be effective on the date that the Sellers receive the prepayment from the Purchasers as contracted.

REASONS AND BENEFITS OF THE TRANSACTION

Benefiting from the rapid growth of the global photovoltaic industry, the Company has expanded its production capacity and production scale in recent years in order to better promote its marketing of PV Glass products and further improve its business performance. The Sales Contract will benefit the marketing of the Company’s large-sized and thin PV Glass products, increase the sales of its PV Glass products, and further improve the Company’s operating results.

INFORMATION OF THE GROUP AND THE SELLERS

The Company is a joint stock company established in the PRC with limited liability, the H Shares of which are listed on the main board of the Stock Exchange and the A Shares of which are listed on the Shanghai Stock Exchange. The Sellers, other than the Company, are wholly-owned subsidiaries of the Company.

The Group is one of the largest photovoltaic glass manufacturers globally and in the PRC, in terms of photovoltaic raw glass and processed photovoltaic glass. The Group also manufactures and sells float glass, household glass and architectural glass.

INFORMATION OF THE PURCHASERS

Risen is a company whose A shares are listed on the Shenzhen Stock Exchange (stock code: 300118). Risen has set up offices and branches worldwide and established a global sales network, such as the PRC, Germany, Australia, Mexico, India, the United States, Japan, etc., aiming to provide green new energy to the world. Risen is principally engaged in the research and development, production and sales of photovoltaic grid-connected power generation systems, photovoltaic stand-alone power supply systems, solar cells and modules.

To the best of the Directors’ knowledge, the Purchasers, their ultimate beneficial owners and their respective associates are all third parties independent of the Group and its connected persons (as defined under the Listing Rules).

LISTING RULES IMPLICATION

As the Sales Contract and the transactions contemplated under the Sales Contract are of a revenue nature in the ordinary and usual course of business of the Group under Rule 14.04(1)(g) of the Listing Rules, it does not constitute as a notifiable transaction for the Company under Chapter 14 of the Listing Rules.

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Shareholders and potential investors of the Company should note that the Sales Contract is subject to certain conditions precedent. Furthermore, the effect on the performance of the Company depends on, among others, the actual quantity delivered, the actual price of the PV Glass under the specific purchaser orders signed by the parties and the revenue recognition under the China Accounting Standards for Business Enterprises. The Sales Contract may also be delayed, amended or terminated due to force majeure or any other reasons. Accordingly, Shareholders and potential investors of the Company shall exercise caution when dealing in the Shares of the Company.

DEFINITIONS

In this announcement, the following expressions shall have the meanings set out below unless the context requires otherwise:

“A Share(s)”	RMB-denominated ordinary share(s) of the Company which are issued
	and subscribed for in RMB in the PRC and are listed on the Shanghai
	Stock Exchange
“Anhui Flat Glass”	Anhui Flat Glass Co., Ltd.* (安徽福萊特光伏玻璃有限公司), a wholly-
	owned subsidiary of the Company in the PRC
“Board”	the board of Directors of the Company
“Company”	福萊特玻璃集團股份有限公司(Flat Glass Group Co., Ltd.*), a joint
	stock company established in the PRC with limited liability, the H Shares
	and A Shares of which are listed on the main board of the Stock Exchange
	and Shanghai Stock Exchange, respectively
“Director(s)”	director(s) of the Company
“Group”	the Company and its subsidiaries
“Hong Kong”	the Hong Kong Special Administrative Region of the People’s Republic
	of China
“H Share(s)”	ordinary share(s) in the share capital of the Company with a nominal
	value of RMB0.25 each, which are subscribed for and traded in Hong
	Kong dollars, and listed on the Stock Exchange (stock code: 6865)
“Listing Rules”	the Rules Governing the Listing of Securities on The Stock Exchange of
	Hong Kong Limited
“PRC”	the People’s Republic of China, and for the purposes of this announcement,
	excluding Hong Kong, the Macau Special Administrative Region and
	Taiwan

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“Purchasers”	Risen and Risen (Changzhou) Energy Co., Ltd.* (東方日升（常州）新能
	源有限公司), Risen (Yiwu) Energy Co., Ltd.* (東方日升（義烏）新能
	源有限公司), Risen (Anhui) Energy Co., Ltd.* (東方日升（安徽）新能
	源有限公司) and Risen (Ningbo) Energy Co., Ltd.* (東方日升（寧波）
	新能源有限公司), the subsidiaries and associated companies of Risen
“PV Glass” or “Photovoltaic	photovoltaic processed glass
Rolled Glass”
“Risen”	Risen Energy Co., Ltd.* (東方日升新能源股份有限公司), a company
	listed on the Shenzhen Stock Exchange (stock code: 300118) and an
	independent third party
“Sales Contract”	the sales contract entered into between the Sellers and the Purchasers
	dated 21 January 2021
“Sellers”	the Company, and Anhui Flat Glass, Zhejiang Jiafu, Flat (Vietnam)
	Company Limited and Flat (Hong Kong) Company Limited, each a
	wholly-owned subsidiary of the Company
“RMB”	Renminbi, the lawful currency of the PRC
“Share(s)”	A Share(s) and H Share(s)
“Shareholder(s)”	holder(s) of the Share(s)
“Stock Exchange”	The Stock Exchange of Hong Kong Limited
“Zhejiang Jiafu”	Zhejiang Jiafu Glass Co., Ltd.* (浙江嘉福玻璃有限公司), a wholly-
	owned subsidiary of the Company in the PRC
	By order of the Board
	Flat Glass Group Co., Ltd.
	Ruan Hongliang
	Chairman

Jiaxing, Zhejiang Province, the People’s Republic of China 21 January 2021

As at the date of this announcement, the executive Directors are Mr. Ruan Hongliang, Ms. Jiang Jinhua, Mr. Wei Yezhong and Mr. Shen Qifu, and the independent non-executive Directors are Mr. Cui Xiaozhong, Ms. Hua Fulan and Mr. Ng Ki Hung.

• If there is any inconsistency between the English name and the Chinese name, the Chinese name shall prevail.

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