Company: FEBO
Filing Date: 2025-05-14
Form Type: 20-F
Source: 0001641172-25-010075
Chunk: 11

Company: Fenbo Holdings Ltd
Filing Date: 2025-05-14
Form: 20-F
Item: Item 3
Chunk 11
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 certain countries, subject to certain exceptions. On April 9, 2025, the U. S. imposed a 145%
tariff on Chinese goods that enter the U. S., together with a range of additional duties on other global trade partners. China
retaliated by imposing a 125% tariff on U. S. goods entering China. On May 11, 2025, the U. S. and China reached an agreement whereby
the 145% tariff imposed by the U. S. on Chinese goods was reduced to 30% and the 125% tariff imposed by China on U. S. goods was
reduced to 10%, both for a period of 90 days. There is uncertainty as to what the level of the tariffs will be after that 90-day
period.

Our sole
customer is Spectrum Brands, a U. S. corporation headquartered in the U. S. We do not have a long-term agreement with Spectrum Brands and
their purchases are made on an order-by-order basis.

Our
products are manufactured in China and would, therefore, be subject to the applicable U. S. tariff imposed on goods
manufactured in China. The imposition by the U. S. of the 145% tariff resulted in the cancellation by Spectrum Brands of a substantial number of its orders and a delay
or reduction in further orders.

Based
on the uncertainty regarding the continued imposition of tariffs and the percentages of such tariffs, it is difficult to predict the
full impact of the tariffs on our business operations and what steps to take to mitigate such impacts. However, in order to commence
mitigation of the adverse effects of the tariffs on our operations, we are exploring the possibility of closing our factory, which
is located in China, and establishing a factory in another country. Unless the tariff situation improves to our satisfaction, we
anticipate the closure of our current factory and establishment of a new factory to be accomplished within the next 12 months.

  10  

Moreover,
tariffs in general could increase the cost to us of manufacturing our products as well as the cost to our U. S. customer of importing our
products. In addition, political uncertainty surrounding international trade disputes and the potential of their escalation to a trade
war and global recession could have a negative effect on overall consumer confidence, which could materially and adversely affect our
business. We also may have access to fewer business opportunities, and our operations may be negatively impacted as a result. In addition,