CHARLOTTE, NC – Cheetah Net Supply Chain Service Inc. (NASDAQ:CTNT), a wholesale motor vehicle and parts supplier, announced today a material modification to the rights of its security holders following a reverse stock split. The company's board of directors approved the reverse stock split at a ratio of 1-for-16, effective as of this morning.
The decision for the reverse stock split was made subsequent to a special stockholders meeting on September 30, 2024, where the action was approved. The company filed its Fourth Amended and Restated Articles of Incorporation with the Secretary of State of North Carolina on October 8, 2024, to implement the change.
At the effective time, every 16 shares of the company's common stock were automatically combined into one new share. No fractional shares were issued; instead, fractional shares resulting from the reverse stock split were rounded up to the nearest whole share. The par value per share remained the same.
This adjustment is expected to begin reflecting on the NASDAQ on October 24, 2024, under a new CUSIP number (16307X202). Alongside the reverse stock split, proportional amendments were made to Cheetah Net's Amended and Restated 2024 Stock Incentive Plan, aligning with the new stock split ratio. These adjustments include changes to the number of shares available for awards and the exercise prices of outstanding awards.
The reverse stock split is part of the company's strategic initiatives to modify the rights of security holders and update its corporate governance. The company’s Fourth Amended and Restated Articles of Incorporation, filed as Exhibit 3.1 with the SEC, contains the full details of these changes.
Cheetah Net Supply Chain Service Inc., based in Charlotte, North Carolina, is recognized under the SIC code 5010, indicating its industry segment in wholesale motor vehicles and motor vehicle parts and supplies. The information provided in this article is based on a press release statement.
In other recent news, Cheetah Net announced two follow-on public offerings of Class A common stock. The first aims to issue 6,479,663 shares at $0.23 per share, with an expectation to raise approximately $1.49 million. The second offering involves 13,210,000 shares at $0.62 each, with an anticipated gross revenue of $8,190,200. FT Global Capital, Inc. and AC Sunshine Securities LLC are managing these offerings respectively.
In executive changes, the company's CFO, Robert Cook, has resigned and CEO Tony Liu has assumed the role of interim CFO. Moreover, Huibo Deng has been appointed as a director and the new chair of the audit committee. These are among the recent developments in Cheetah Net's ongoing business operations.
InvestingPro Insights
Cheetah Net Supply Chain Service Inc.'s recent reverse stock split comes amid challenging financial circumstances, as revealed by InvestingPro data. The company's market capitalization stands at a modest $9.72 million, reflecting its current struggles. InvestingPro Tips highlight that CTNT's stock price has fallen significantly over the past year, with a stark 84.66% decline in the one-year price total return.
Despite these challenges, there are some positive indicators. An InvestingPro Tip notes that CTNT holds more cash than debt on its balance sheet, which could provide some financial flexibility as it navigates this period of restructuring. Additionally, the company has seen a significant return over the last week, with a 15.63% price increase, possibly in response to the reverse stock split announcement.
It's worth noting that analysts anticipate a sales decline in the current year, which aligns with the reported 59.8% revenue decline in the last twelve months. The company's gross profit margin is also weak, standing at 10.8% for the same period.
For investors seeking a more comprehensive analysis, InvestingPro offers 10 additional tips for CTNT, providing a deeper understanding of the company's financial health and market position.
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