Business Context and Reporting Period
This Form 8-K Current Report was filed by Code Chain New Continent Limited (trading symbol: CCNC) on April 6, 2021, regarding events occurring on March 31, 2021. The Company is incorporated in Nevada and operates primarily in China. The report details the completion of a significant asset disposition involving a subsidiary and a variable interest entity.
Key Financial Metrics and Transaction Details
The filing focuses on a specific transaction rather than general operating results for the period. Key financial data points include:
- Transaction Type: Sale of 100% of issued and outstanding ordinary shares of Tongrong Technology (Jiangsu) Co., Ltd. ("Tongrong WFOE") and its controlled variable interest entity, Jiangsu Rong Hai Electric Power Fuel Co., Ltd. ("Rong Hai").
- Total Purchase Price: $2,464,411.
- Payment Method: Cancellation of 426,369 shares of the Company's common stock owned by the former director (the "Payee").
- Share Valuation: The cancelled shares were valued at $5.78 per share, based on the average closing price over the 30 trading days prior to the agreement (February 12, 2021, to March 26, 2021).
- Financial Statements: Unaudited pro forma condensed consolidated financial statements for fiscal years ended December 31, 2020 and 2019, are provided in Exhibit 99.1. The filing text itself does not contain specific revenue, profit, cash flow, or debt figures for the Company.
Material Changes Versus Prior Period
The primary material change is the divestiture of Tongrong WFOE and Rong Hai. This transaction results in the removal of these entities from the Company's consolidated financial statements. The filing does not provide comparative revenue or earnings data to quantify the impact on historical performance metrics within the text body.
Guidance, Outlook, and Risks
The filing does not contain forward-looking guidance, management commentary on future outlook, or specific risk factors beyond the disclosure of the completed transaction. The transaction was executed with an unaffiliated buyer and involved the cancellation of shares held by a former director, Qihai Wang.
Investor Verification Checklist
- Review Exhibit 99.1 for the unaudited pro forma financial statements to understand the impact of the divestiture on the Company's balance sheet and operations.
- Verify the current share count and capital structure following the cancellation of 426,369 shares.
- Confirm the status of the variable interest entity (Rong Hai) and ensure it is no longer consolidated in future reporting periods.
- Check for any subsequent filings regarding the use of proceeds or further restructuring related to the Tongrong WFOE sale.