Item 8.01 Other Events.
ChinaNet Online Holdings, Inc. (the “Company”)
is filing this Current Report on Form 8-K, pursuant to an order issued by the U.S. Securities and Exchange Commission (the “SEC”)
dated on March 25, 2020 (Release No. 34-88465) (the “SEC Order”), providing conditional relief to public companies
that are unable to timely comply with their filing obligations as a result of the outbreak of COVID-19. By filing this Current
Report on Form 8-K, the Company is relying on the SEC Order to receive an additional 45 days to file its Quarterly Report on Form
10-Q for the period ended March 31, 2020 (the “10-Q”). The 10-Q would have been due on May 15, 2020. With this extension
the Company expects to file the 10-Q on or before June 29, 2020.
The Company conducts its business operations
in China, primarily in two cities, Beijing and Xiaogan City, Hubei Province. Xiaogan City is located approximately 70 kilometers
from WuHan, the provincial capital of Hubei Province which was the critical epicenter of the COVID-19 outbreak. In accordance with
the epidemic control measures imposed by the local governments, since February 2020, the Company, along with most other business
entities in Xiaogan City and Beijing remained closed after the Chinese New Year holiday (January 24-February 2, 2020) and were
unable to reopen until mid-March or early-April in 2020. As a result, the Company’s accounting and other staff, who are instrumental
in the daily accounting work and periodical closing (annual and quarterly) and audit/review process, had been unable to come to
work during the office shutdown.
Normally, the Company commences its annual
closing and audit preparation work in January, and prepares its annual report on Form 10-K and cooperates with the auditors to
complete the annual audit procedures during the first fiscal quarter, in order to ensure a timely filing of its annual report on
Form 10-K every year. However, the outbreak of COVID-19 in China during the first fiscal quarter of 2020 has posed a significant
impact on the Company’s ability to file on a timely basis its annual report on Form 10-K for the year ended December 31,
2019 (the “10-K”), which includes, among other things, delayed audit preparation and cooperation procedures due to
business shutdown until Mid-March or early-April; delayed audit confirmation response and delivery from commercial banks, suppliers
and customers, resulted from business shutdown and other epidemic control measures put in place by the local government of different
cities in China during the outbreak, and slow recovery of operations afterwards; and delayed on-sit audit arrangements in the Company’s
operational offices, resulted from travel restriction and mandatory quarantine policies imposed by the local governments.
As of the date of this current report,
the Company has not filed the 10-K with the SEC due to the fact that the Company was unable to finalize its financial results as
well as the disclosure requirements of the 10-K without unreasonable expense or effort, which resulted from circumstances related
to the COVID-19 outbreak described above.
As a result, the Company’s quarterly
closing and the preparation of its quarterly report on Form 10-Q for the period ended March 31, 2020 was postponed accordingly,
which adversely impacted the Company’s ability to file the 10-Q on a timely basis.
The Company has taken all possible measures
to overcome the adverse impacts derived from the COVID-19 outbreak related to the filing of the 10-Q. To the best of the Company’s
knowledge, despite the challenge of the slow recovery to normal operations under various restrictions, the Company believes that
it will be able to file the 10-Q within the additional 45 days granted by the SEC Order on or before June 29, 2020.
The Company affirms the following risk
factor due to the uncertainty of the COVID-19 outbreak:
We are susceptible to general economic
conditions, natural catastrophic events and public health crises, and a potential downturn in advertising and marketing spending
by advertisers could adversely affect our operating results in the near future.
Our business is subject to the impact of
natural catastrophic events, such as earthquakes, or floods, public health crisis, such as disease outbreaks, epidemics, or pandemics
in China, and all these could result in a decrease or sharp downturn of economies, including our markets and business locations
in the current and future periods. The outbreak of the coronavirus (COVID-19) pandemic in China resulted in increased
travel restrictions, and shutdown of businesses, which has caused slower recovery of the China economy. We may experience
impact from quarantines, market downturns and changes in customer behavior related to pandemic fears and impact on our workforce
if the virus continues to spread. COVID-19 affected a significant number of our workforce employed in our operations, and as a
result we are experiencing a slow resumption of operations and may experience delays or the inability to delivery our service on
a timely basis. In addition, one or more of our customers, partners, service providers or suppliers may experience financial distress,
delayed or defaults on payment, file for bankruptcy protection, sharp diminishing of business, or suffer disruptions in their business
due to the outbreak. The extent to which the COVID-19 pandemic impacts our results will depend on future developments and reactions
in China, which are highly uncertain and will include emerging information concerning the severity of the COVID-19 pandemic and
the actions taken by governments and private businesses to attempt to contain the coronavirus. The COVID-19 situation is likely
to result in a potential material adverse impact on our business, results of operations and financial condition in the short run
if it has come worse in China. Wider-spread COVID-19 in China and globally could prolong the deterioration in economic conditions
and could cause decreases in or delays in advertising spending and reduce and/or negatively impact our short-term ability to grow
our revenues. Any decreased collectability of accounts receivable, bankruptcy of small and medium businesses, or early termination
of agreements due to deterioration in economic conditions could negatively impact our results of operations.
Forward-Looking Statements
Certain of the statements contained in
this report should be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933,
and Section 21E of the Securities Exchange Act of 1934, which can be identified by the use of forward-looking terminology
such as "believes," "expects," "anticipates," "estimates" or similar expressions. These
statements relate to future events or the Company’s future financial performance. These forward-looking statements are based
on the Company’s current expectations and beliefs concerning future developments of the COVID-19 outbreak and their potential
effects on the Company. There can be no assurance that future developments of the COVID-19 outbreak affecting the Company will
be those anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond the control
of the Company) or other assumptions that may cause actual results or performance to be materially different from those expressed
or implied by such forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities
laws.