Item 8.01 Other Events.
On March 25, 2020, the U.S. Securities and Exchange Commission (the
"Commission") issued a Press Release which superseded an order under Section 36
(Release No. 34-88318) of the Securities Exchange Act of 1934, as amended
("Exchange Act"), granting public companies with a 45-day extension to file
certain disclosure reports that would otherwise have been due between March 1,
2020 and July 1, 2020. Among other conditions, companies must continue to convey
through a current report a summary of why the relief is needed in their
particular circumstances for each periodic report that is delayed. Companies
that receive an extension on filing Exchange Act annual reports or quarterly
reports pursuant to the Order will be considered to have a due date 45 days
after the filing deadline for the report. As such, those companies will be
permitted to rely on Rule 12b-25 if they are unable to file the required reports
on or before the extended due date. The purpose of this Current Report on Form
8-K is to comply with these conditions.
Kiwa Bio-Tech Products Group Corporation (the "Company") originally filed a Form
8-K regarding the coronavirus' potential impact on its business and its ability
to timely file its Form 10-K Annual Report for the period ended December 31,
2019.
As previously announced in its Form 8-K filed on March 6, 2020 (and amended on
March 30, 2020), the preparation of the Company's Annual Report including
financial statements and completion of the auditing process has been delayed by
Chinese Government-imposed quarantines, office closings and travel restrictions
which affect both the Company's and its service provider's personnel.
Specifically, the Company has significant operations in the city of Yangling,
Shaanxi Province, China. Due to concerns related to the spread of the
Coronavirus, the entire city of Yangling has been locked down by the Government
of China since January 25, 2020. All of the Company's employees in this area
have been required by the Government to stay at home until further notice,
subject to the containment of the Coronavirus. Banks in the area are not engaged
in normal operations and specific bank reporting required to complete the
Company's audit cannot be obtained at this time. In compliance with the
Government's health emergency rules in place, the Company's building has been
temporarily closed since January 19, 2020 and people are not allowed to enter
the office and to access certain of the Company's business records located in
it. Due to Government-imposed quarantines, office closings and travel
restrictions affecting the Company's personnel and service providers, the
Company's accounting department has been unable to process certain of its
accounting records and receipts required to complete the audit of the Company's
financial statements.
These unforeseen circumstances have resulted in the Company being unable to
timely file an accurate Annual Report on Form 10-K for its year-ended December
31, 2019 by the prescribed date without undue hardship and expense to the
Company. Accordingly, in reliance upon the Order, the Company expects to file
its Annual Report on Form 10-K no later than 45 days after the due date of
filing of March 30, 2020, unless the COVID-19 circumstances do not change and
cause a further delay, in which case we will file for an additional extension
and amendment to this Current Report on Form 8-K.
For the same reasons, the Company will be unable to timely file its Form 10-Q
Quarterly Report for the period ended March 31, 2020 which is due on May 15,
2020. The Company expects that it will be able to file each of its Annual Report
and Quarterly report within 45 days of the due date of each respective report.
The Company is also reiterating its risk factors previously disclosed in the
Company's Annual Report on Form 10-K for the year ended December 31, 2018 and
its subsequent Quarterly Reports on Form 10-Q with the following risk factor:
We do not yet know the extent we could be affected by the Coronavirus (COVID-19)
pandemic
In December 2019, an outbreak of a novel strain of coronavirus (COVID-19)
originated in Wuhan, China, and has since spread to a number of other countries,
including the United States. On March 11, 2020, the World Health Organization
characterized COVID-19 as a pandemic. In addition, as of this time, several
states in the United States have declared states of emergency, and several
countries around the world, including the United States, have taken steps to
restrict travel. Our operations are principally located in China, which has
taken action to regulate the flow of labor and products and impede the travel of
personnel, may impact our ability to conduct normal business operations, which
could adversely affect our results of operations and liquidity. Disruptions to
our supply chain and business operations, or to our suppliers' or customers'
supply chains and business operations, could include disruptions from the
closure of supplier and manufacturer facilities, interruptions in the supply of
raw materials and components, personnel absences, or restrictions on the
shipment of our or our suppliers' or customers' products, any of which could
have adverse ripple effects on our manufacturing output and delivery schedule.
If a critical number of our employees become too ill to work, or we are not able
to access a sufficient quantity of our inventory for shipment due to enforced
office closures, our production ability could be materially adversely affected
in a rapid manner. Similarly, if our customers experience adverse business
consequences due to COVID-19, or any other, pandemic, demand for our products
could also be materially adversely affected in a rapid manner. Global health
concerns, such as COVID-19, could also result in social, economic, and labor
instability in the countries and localities in which we or our suppliers and
customers operate. Any of these uncertainties could have a material adverse
effect on our business, financial condition or results of operations.
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