14/01/2025
** Explanation of Situation Concerning the Mini Craft Collection (MCC) **
Since the end of 2021, Mr. Chen ZeXi (Jersey) has been seeking to collaborate with our company, Shanghai ScaleSky Trading Co Ltd, to develop the new MINI CRAFT collection (MCC) brand he founded. Because of our company specializes in importing overseas model kit products for distribution in mainland China while also selling Chinese model kits in international markets.
As a result, we possess considerable expertise in the model kits market and have developed effective sales channels.
Following the formation of our partnership, our company assumed full responsibility for market development, including the seek for resellers, as well as managing sales and shipping for the MCC brand, both domestically in China and in overseas markets.
We also established a Facebook public page to promote these products.
At the end of 2022, Mr. Chen quit his previous job to work full-time on the design of MCC products. During this time, our company and Mr. Chen reached a comprehensive agreement, establishing a new company. The Mini Craft Collection (MCC) brand and its original designs now belong to this new company, which is co-owned by our company with a 65% stake and Mr. Chen with a 35% stake. Responsibilities are presently divided, with Mr. Chen concentrating on product design and production, while our company continues to manage marketing operations, sales, shipping, and customer service. Furthermore, our company completed the product line establishment, involved graphic design, and selected aspects of product design.
However, throughout this partnership, we encountered several significant challenges stemming from Mr. Chen's personal issues, which led to severe delays in design progress, inadequate quality control, and subsequent product recalls.
After exhaustive negotiations, we determined that the issues could not be satisfactorily resolved.
Earlier this year, I sought to engage Mr. Chen in discussions regarding the current complications affecting the MCC brand for one final time.
Unfortunately, his unwillingness to address these matters led me to conclude that terminating our collaboration was necessary, as Mr. Chen was unable to fulfill his responsibilities effectively, resulting in considerable losses for our company.
At present, the MCC brand is undergoing liquidation. However, prior to the completion of this process, Mr. Chen removed all designs and deleted pertinent data and records, including unreleased new products, before disappearing. He has further attempted to create a new Facebook public page while trying to erase the original page, (Previously, in order to facilitate brand promotion, we granted Mr. Chen full public page permissions). We were fortunate to recover the original page. His actions have severely compromised our company's interests and the MCC brand's reputation, potentially leading to losses for you and your company.
Mr. Chen is presently seeking “new partners.”
We are currently contemplating legal action to address this matter.
In the meantime, we are trying to recover the data and the production. We hope to restore the MCC brand product line within a certain period of time.
We thank you for supporting our products and deeply regret any trouble or inconvenience this has caused you.
This statement serves as an official explanation.
Shanghai ScaleSky Trading Co Ltd
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