SSHT S&T Group Ltd S-1, filed May 11, 2023
SSHT S&T Group Ltd. (SSHT)
As filed with the Securities and Exchange Commission on May 11, 2023.
Registration No. ______________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-1
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
SSHT S&T Group Ltd.
(Exact name of Registrant as specified in its charter)
| Nevada | 8742 | 93-0734888 | ||
| (Incorporation or | (Primary Standard Industrial | (I.R.S. Employer | ||
| organization) | Classification Code Number) | Identification Number) |
46 Reeves Road, Pakuranga
Auckland, New Zealand, 2010
+61 405-223-877
(Name, address, telephone number of agent for service)
Zonghan Wu
Chief Executive Officer
SSHT S&T Group Ltd.
46 Reeves Road, Pakuranga
Auckland, New Zealand, 2010
+61 405-223-877
(Address and Telephone Number of Registrant’s Principal Executive Offices and Principal Place of Business)
Communication Copies to
Jeff Turner
JDT Legal, PLLC
897 W Baxter Dr.
South Jordan, UTAH 84095
Telephone: (801) 810-4465
Facsimile: (888) 920-1297
Email: jeff@jdt-legal.com
Approximate date of proposed sale to the public: As soon as practicable and from time to time after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
If this Form is a post-effective amendment filed pursuant to rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ | |
| Emerging Growth Company | ☐ | |||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
The Registrant hereby may amend this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Commission, acting pursuant to such Section 8(a), may determine.
The information in this prospectus is not complete and may be changed without notice. The Selling Security Holders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and neither the Registrant nor the Selling Security Holders are soliciting offers to buy these securities, in any state where the offer or sale of these securities is not permitted.
| PRELIMINARY PROSPECTUS | SUBJECT TO COMPLETION | DATED May 11, 2023 |
SSHT S&T GROUP LTD.
100,000,000 SHARES OF COMMON STOCK
This is a public offering of our common stock, a par value $0.001 per share. We are selling up to 100,000,000 shares of our common stock.
This offering will terminate on the date which is 270 days from the effective date of this prospectus, although we may close the offering on any date prior if the offering is fully subscribed to or upon the vote of our board of directors.
We currently expect the public offering price of the shares we are offering to be $0.01 per share of our common stock.
The Company is quoted on the OTC Pink market and there is a limited established market for our stock. The offering price of the shares has been determined arbitrarily by us. The price does not bear any relationship to our assets, book value, earnings, or other established criteria for valuing a company. In determining the number of shares to be offered and the offering price, we took into consideration our capital structure and the amount of money we would need to implement our business plans. Accordingly, the offering price should not be considered an indication of the actual value of our securities.
Investing in our common stock involves a high degree of risk. See “Risk Factors” for certain risks you should consider before purchasing any shares in this offering. This prospectus is not an offer to sell these securities and it is not the solicitation of an offer to buy these securities in any state where the offeror sale is not permitted.
The offering is being conducted on a self-underwritten, best efforts basis, which means our management will attempt to sell the shares being offered hereby on behalf of the Company. There is no underwriter for this offering.
Completion of this offering is not subject to us raising a minimum offering amount. We do not have an arrangement to place the proceeds from this offering in an escrow, trust, or similar account. Any funds raised from the offering will be immediately available to us for our immediate use.
We are an “emerging growth company” under the federal securities laws and will be subject to reduced public company reporting requirements. Our common stock is quoted under the symbol “SSHT” on the OTC Markets (“OTC Pink”). On May 1, 2023, the last reported sale price of our common stock was $0.5901.
Any purchaser of common stock in the offering may be the only purchaser, given the lack of a minimum offering amount.
This Offering is highly speculative, and these securities involve a high degree of risk and should be considered only by persons who can afford the loss of their entire investment. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The Company does not plan to use this offering prospectus before the effective date.
The date of this Prospectus is May 11, 2023.
ADDITIONAL INFORMATION
You should rely only on the information contained or incorporated by reference in this prospectus and in any accompanying prospectus supplement. No one has been authorized to provide you with different information. The shares are not being offered in any jurisdiction where the offer is not permitted. You should not assume that the information in this prospectus or any prospectus supplement is accurate as of any date other than the date on the front of such documents.
TABLE OF CONTENTS
The following table of contents has been designed to help you find information contained in this prospectus. We encourage you to read the entire prospectus.
Please read this Prospectus carefully and in its entirety. This Prospectus contains disclosure regarding our business, our financial condition and results of operations and risk factors related to our business and our Common Stock, among other material disclosure items. We have prepared this Prospectus so that you will have the information necessary to make an informed investment decision.
You should rely only on information contained in this Prospectus. We have not authorized any other person to provide you with different information. This Prospectus is not an offer to sell, nor is it seeking an offer to buy these securities in any state where the offer or sale is not permitted. The Selling Stockholder may not sell the securities listed in this Prospectus until the Registration Statement filed with the Securities and Exchange Commission is effective. The information in this Prospectus is complete and accurate as of the date on the front cover, but the information may have changed since that date.
The Registration Statement containing this Prospectus, including the exhibits to the Registration Statement, provides additional information about us and our Common Stock offered under this Prospectus. The Registration Statement, including the exhibits and the documents incorporated herein by reference, can be read on the Securities and Exchange Commission website or at the Securities and Exchange Commission offices mentioned under the heading “Where You Can Find More Information.”
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You should carefully read all information in the prospectus, including the financial statements and their explanatory notes under the Financial Statements prior to making an investment decision.
This summary highlights selected information appearing elsewhere in this prospectus. While this summary highlights what we consider to be important information about us, you should carefully read this entire prospectus before investing in our Common Stock, especially the risks and other information we discuss under the headings “Risk Factors”, our “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and our consolidated financial statements and related notes beginning on page F-1. Our fiscal year end is December 31. We have included audited financial statements for fiscal years ended December 31, 2022, and 2021 in this prospectus. Some of the statements made in this prospectus discuss future events and developments, including our future strategy and our ability to generate revenue. These forward-looking statements involve risks and uncertainties which could cause actual results to differ materially from those contemplated in these forward-looking statements. See “Special Note Regarding Forward-Looking Statements” on page 12 of this Prospectus.
Except as otherwise required by the context, references in this prospectus to “the Company,” “SSHT,” “we,” “our,” “us” refer to SSHT S&T Group Ltd.
This summary contains basic information about us and the offering. Because it is a summary, it does not contain all the information that you should consider before investing. You should read the entire prospectus carefully, including the risk factors and our financial statements and the related notes to those statements included in this prospectus.
We have not authorized anyone to provide you with different information and you must not rely on any unauthorized information or representation. We are not making an offer to sell these securities in any jurisdiction where an offer or sale is not permitted. This document may only be used where it is legal to sell these securities. You should assume that the information appearing in this prospectus is accurate only as of the date on the front of this prospectus, regardless of the time of delivery of this prospectus, or any sale of our common stock. Our business, financial condition and results of operations may have changed since the date on the front of this prospectus. We urge you to carefully read this prospectus before deciding whether to invest in any of the common stock being offered.
Overview
We provide capital market research, back-office support, financial accounting, listing support, and support for mergers and acquisitions for our clients.
Our Corporate History and Background
The Company was incorporated on March 7, 1984, under the laws of the State of Oregon as Gold Genie Worldwide, Inc. On June 13,1988 the Company filed an amendment to its Articles of Incorporation and changed its name to Products, Services & Technology Corporation. On June 2, 1997, the Company redomiciled to Utah and changed its name to Wireless Data Solutions, Inc. on June 13, 1997. In August of 2007, the Company redomiciled to Nevada, where its registration remains active and in good standing. In December of 2021, the Company changed its name to SSHT S&T Group Ltd.
On December 05, 2022, the Company entered into a Definitive Share Exchange Agreement with Wahoo Holdings Ltd., a British Virgin Islands corporation (“WHL”), whereunder the Company acquired 100% ownership interest in WHL for the issuance of 10,000,000 shares of the Company’s common stock. WHL, through its China based subsidiary, Shanghai Jieshi Management Consulting Co., Ltd.(“WFOE”), provides capital market research, back-office support, financial accounting, listing support and support for mergers and acquisitions to its clients. The transaction closed effective December 08, 2022, and has been treated as a business combination under common control, resulting in WHL becoming a wholly-owned subsidiary of the Company.
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As a result of the above transaction, the Company’s corporate structure which is set forth as follows:
Business Overview
The main business of WFOE is to provide business consulting services to small and medium-sized enterprises and, using a team of accounting and finance professionals, to provide its clients with capital market research, back office support, financial accounting, listing support, and support for mergers and acquisitions. Since WFOE’s inception in 2019, the main focus of our consulting business has been providing comprehensive going public consulting services designed to help small and medium-sized enterprises become public companies on suitable markets and exchanges. Our goal is to become an international financial consulting company with clients and offices throughout Asia. To date, we have focused on helping clients go public on the OTC markets and exchanges in the U.S., but we are in the process of expanding our service to listing clients on domestic exchanges in China as well as the Hong Kong Stock Exchange.
Since our inception until December 31, 2022, the close of our last full fiscal year, our revenue was mainly generated from our going public consulting services. We also generated a small portion of our revenue from back-office support, financial accounting, listing support and support for mergers and acquisitions. We generated a total revenue of approximately US$330,525, for the fiscal years ended December 31, 2022. The revenues generated from going public consulting services were around $300,000 for the fiscal years ended December 31, 2022.
In China, a fast-growing economy and a positive market environment have created many entrepreneurial and high-growth enterprises, many of which need assistance in obtaining development funds through financing. China has relatively immature financial systems compared to developed countries. Due to restrictions imposed by China’s foreign exchange regulations, it is difficult for foreign capital to enter China’s capital market. Because of the strict listing policies and a relatively closed financial environment in mainland China, most small to medium sized enterprises in the development stage are unable to list on domestic exchanges in China. Therefore, many Chinese enterprises strive to enter international capital markets through overseas listing for equity financing. However, in China, there is a general lack of understanding of international capital markets, as well as a lack of professional institutions that provide overseas going public consulting services to these companies, and many of them may not be familiar with overseas listing requirements.
We launched our consulting services in 2022. Our aim was to assist these Chinese enterprises by filling the gaps and forming a bridge between PRC companies and overseas markets and exchanges. We have a team of qualified and experienced personnel with legal, regulatory and language expertise in several overseas jurisdictions. Our services are designed to help small and medium sized enterprises in China achieve their goal of becoming public companies. We create a going public strategy for each client based on many factors, including our assessment of the client’s financial and operational situations, market conditions, and the client’s business and financing requirements. Since our inception and up to the date of this registration statement, we have successfully helped one Chinese enterprises to be quoted on the U.S. OTC markets and are currently assisting our other clients in their respective going public efforts. All of our current and past clients have been Chinese companies, and we plan to expand our operations to other Asian countries, such as Malaysia, Vietnam, and Singapore, by the year of 2025.
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Principal Suppliers & Customers
The Company’s principal clients are and have been Chinese companies who seek our services to achieve their goal of becoming public companies. Most of them are small and medium size enterprises in China. We have established long-term professional relationships with a group of well-known third party professional providers both domestically and in the U.S., such as investment banks, certified public accounting firms, law firms, investor relations agencies, whose services and support are necessary for us to provide high quality one-stop going public consulting service to our clients
Employees
We have 3 people employed and 1 full-time person employed by the Company.
Where You Can Find Us
As of December 31, 2022, the issuer rents an office at 46 Reeves Road, Pakuranga Auckland, New Zealand, 2010 and Room B-17, 4th Floor, Building 1, No. 608 Pengfeng Road, Xiaokunshan Town, Songjiang District, Shanghai for its staff on a month-to-month basis.
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| Issuer: | SSHT S&T Group Ltd. | |
| Common stock offered by us: | 100,000,000 shares at $0.01 per share | |
| Common stock outstanding before the offering: | 109,903,473 shares as of April 10, 2023 | |
| Common stock to be outstanding after the offering: | 209,903,473 shares. | |
| Use of proceeds: | We expect to receive net proceeds from this offering of approximately $1,000,000 assuming all the shares offered hereby are sold and before deducting estimated offering expenses payable by us.
We intend to use the net proceeds of the offering for working capital and other general corporate purposes. See “Use of Proceeds.” | |
| Dividend policy: | We have never declared or paid cash dividends on our common stock. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. We do not intend to pay cash dividends in respect of our common stock in the foreseeable future. Any future determination to pay dividends will be at the discretion of our board of directors. | |
| OTC Symbol: | SSHT | |
| Risk factors: | Investing in our common stock involves a high degree of risk. See “Risk Factors” beginning on page 5 of this prospectus for a discussion of factors you should carefully consider before deciding to invest in our common stock. |
Emerging Growth Company
We are and we will remain an “emerging growth company” as defined under The Jumpstart Our Business Startups Act (the “JOBS Act”), until the earliest to occur of (i) the last day of the fiscal year during which our total annual revenues equal or exceed $1 billion (subject to adjustment for inflation), (ii) the last day of the fiscal year following the fifth anniversary of our initial public offering, (iii) the date on which we have, during the previous three-year period, issued more than $1 billion in non-convertible debt securities, or (iv) the date on which we are deemed a “large accelerated filer” (with at least $700 million in public float) under the Securities and Exchange Act of 1934, as amended (the “Exchange Act”).
As an “emerging growth company”, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to public companies. These provisions include:
| ● | only two years of audited financial statements in addition to any required unaudited interim financial statements with correspondingly reduced “Management’s Discussion and Analysis” disclosure; |
| ● | reduced disclosure about our executive compensation arrangements; |
| ● | no requirement that we hold non-binding advisory votes on executive compensation or golden parachute arrangements; and |
| ● | exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting. |
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The shares of our Common Stock being offered for resale by the Selling Shareholders are highly speculative in nature, involve a high degree of risk and should be purchased only by persons who can afford to lose their entire amount invested in the Common Stock. Accordingly, prospective investors should carefully consider, along with other matters referred to herein, the following risk factors in evaluating our business before purchasing any shares of Common Stocks. If any of the following risks actually occurs, our business, financial condition or operating results could be materially adversely affected. In such a case, you may lose all or part of your investment. In addition to the risk factors described below, and some of which are part of our Form 10-12G/A filed with the SEC on November 9, 2022, you should carefully consider the risks and the other information in this Prospectus before investing in our Common Stock.
Risks Related to Our Business
We have a limited operating history and are subject to the risks encountered by early-stage companies.
Our operating subsidiary, WFOE, has only been in business since June 26, 2019. We did not generate any revenue until the year ended December 31, 2021. As a start-up company, our business strategies and model are constantly being tested by the market and operating results, and we pursue to adjust our allocation of resources accordingly. As such, our business may be subject to significant fluctuations in operating results in terms of amounts of revenues and percentages of total with respect to the business segments.
We are, and expect for the foreseeable future to be, subject to all the risks and uncertainties, inherent in a new business and in an industry which is in the early stages of development in China. As a result, we must establish many functions necessary to operate a business, including expanding our managerial and administrative structure, assessing and implementing our marketing program, implementing financial systems and controls and personnel recruitment. Accordingly, you should consider our prospects in light of the costs, uncertainties, delays and difficulties frequently encountered by companies with a limited operating history. These risks and challenges are, among other things:
| ● | we operate in an industry that is or may in the future be subject to increasing regulation by various governmental agencies in China; |
| ● | we may require additional capital to develop and expand our operations which may not be available to us when we require it; |
| ● | our marketing and growth strategy may not be successful; |
| ● | our business may be subject to significant fluctuations in operating results; and |
| ● | we may not be able to attract, retain and motivate qualified professionals. |
Our future growth will depend substantially on our ability to address these and the other risks described in this prospectus. If we do not successfully address these risks, our business will be significantly harmed.
Our historical financial results may not be indicative of our future performance.
Our net loss was $ 76,831 for the year ended December 31, 2021, and increased to a net income of $437 for the year ended December 31, 2022. However, our historical growth rate and the limited history of operations make it difficult to evaluate our prospects. We may not be able to sustain our historically rapid growth or may not be able to grow our business at all.
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Changes in the U.S. capital markets could make our services less attractive to our clients and adversely affect our business and financial condition.
Our consulting services help our clients based in mainland China become public companies. We are expanding our consulting services to include Chinese domestic exchanges and the Hong Kong Stock Exchange, but currently, all our former and current clients have chosen to go public in the U.S. We believe this is due to the more flexible rules provided by the U.S. OTC markets and exchanges than the Chinese domestic exchanges, as well as the attractive financing and growth opportunities the U.S. capital market, which has remained relatively stable comparing to the Chinese capital market. As a result, our going public consulting business has flourished since its inception in 2021. However, changes in the U.S. capital markets could make our service less desirable to Chinese enterprise. For example, if the U.S. OTC markets and exchanges make their rules more stringent to Chinese enterprises, then fewer Chinese enterprises will be able to use our consulting services to go public in the U.S., and our business and financial condition will be adversely affected as a result.
A severe or prolonged downturn in the global or Chinese economy could materially and adversely affect our business and our financial condition.
Although the Chinese economy has grown steadily in the past decade, there is considerable uncertainty over the long-term effects of the expansionary monetary and fiscal policies adopted by the People’s Bank of China and financial authorities of some of the world’s leading economies, including the United States and China. There have also been concerns on the relationship among China and other western countries, which may result in or intensify potential conflicts in relation to territorial disputes. Economic conditions in China are sensitive to global economic conditions, as well as changes in domestic economic and political policies and the expected or perceived overall economic growth rate in China. Any severe or prolonged slowdown in the global or Chinese economy may materially and adversely affect our business, results of operations and financial condition.
Increasing competition within our industry could have an impact on our business prospects.
The financial consulting market is an industry where new competitors can easily enter since there are no significant barriers to entry. Competing companies may have significantly greater financial and other resources than we have and may offer services that are more attractive to companies seeking funds; increased competition would have a negative impact on both our revenues and our profit margins.
If we fail to hire, train and retain qualified managerial and other employees, our business and results of operations could be materially and adversely affected.
We place substantial reliance on the consulting and financial service industry experience and knowledge of our chairman as well as their relationships with other industry participants. The loss of the services of chairman could hinder our ability to effectively manage our business and implement our growth strategies. Finding suitable replacements for our current chairman could be difficult, and competition for such personnel of similar experience is intense. If we fail to retain our chairman, our business and results of operations could be materially and adversely affected.
Since our Chairman will own at least 69.9% of our Common Stock following the sale of the offering, he will have the ability to elect directors and approve matters requiring shareholder approval by way of resolution of members.
Mr. Zonghan Wu, our Chairman of the Board, is currently the beneficial owner of 87,300,000, or 79.4% of our outstanding Common Stock, If we sell the offering number of Common Stock, Mr. Wu will have the right to vote 41.5% of the Common Stock. Mr. Wu is expected to have the power to elect all directors and approve all matters requiring shareholder approval without the votes of any other shareholder. He is expected to have significant influence over a decision to enter into any corporate transaction and has the ability to prevent any transaction that requires the approval of shareholders, regardless of whether or not our other shareholders believe that such transaction is in our best interests. Such concentration of voting power could have the effect of delaying, deterring, or preventing a change of control or other business combination, which could, in turn, have an adverse effect on the market price of our Common Stock or prevent our shareholders from realizing a premium over the then-prevailing market price for their Common Stock
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Risks Relating to Doing Business in China
There are significant uncertainties under the Draft Foreign Investment Law relating to the status of businesses in China controlled by foreign invested entities primarily through contractual arrangements, such as our business.
On January 19, 2015, MOFCOM published a draft of the PRC Law on Foreign Investment (Draft for Comment), or the Draft Foreign Investment Law. At the same time, MOFCOM published an accompanying explanatory note of the Draft Foreign Investment Law, or the Explanatory Note, which contains important information about the Draft Foreign Investment Law, including its drafting philosophy and principles, main content, plans to transition to the new legal regime and treatment of business in China controlled by foreign invested enterprises, or FIEs, primarily through contractual arrangements. The Draft Foreign Investment Law utilizes the concept of “actual control” for determining whether an entity is considered to be a foreign-invested enterprise, and defines “control” broadly to include, among other things, voting or board control through contractual arrangements.
The Draft Foreign Investment Law proposes significant changes to the PRC foreign investment legal regime and may have a material impact on Chinese companies listed or to be listed overseas. The Draft Foreign Investment Law would regulate FIEs the same way as PRC domestic entities, except for those FIEs that operate in industries deemed to be either “restricted” or “prohibited” in a “negative list.” The Draft Foreign Investment Law also provides that only FIEs operating in industries on the negative list will require entry clearance and other approvals that are not required of PRC domestic entities. As a result of the entry clearance and approvals, certain FIE’s operating in industries on the negative list may not be able to continue to conduct their operations through contractual arrangements. The Draft Foreign Investment Law also provides that entities established in China but controlled by foreign investors will be treated as FIEs, while entities set up outside of China which are controlled by PRC persons or entities, would be treated as domestic entities after completion of market entry procedures. The MOFCOM, and the National Development and Reform Commission, or NDRC, promulgated the Catalogue of Industries for Guiding Foreign Investment, or the Catalogue, as amended on March 10, 2015, which came into effect on April 10, 2015, and as further amended on June 28, 2018 and came into effect on July 28, 2018 (the “2018 Catalogue”). According to the 2018 Catalogue, financial consulting services sector in which the Company is currently engaged in business operations, are not deemed to be either “restricted” or “prohibited” in a “negative list.” However, the MOFCOM and NDRC publish new Catalogues from time to time that may change the scope of the “negative list,” and as such it is uncertain whether future Catalogues may re-classify financial consulting services sector in the “negative list.”
There is substantial uncertainty regarding the Draft Foreign Investment Law, including, among others, what the actual content of the law will be as well as the adoption and effective date of the final form of the law. As a result, we cannot assure you that the new Foreign Investment Law, when it becomes effective, will not have a material and adverse effect on our ability to conduct our business.
The Draft Foreign Investment Law, if enacted as proposed, may also materially impact our corporate governance practice and increase our compliance costs. For instance, the Draft Foreign Investment Law imposes stringent ad hoc and periodic information reporting requirements on both foreign investors and the FIE subject to the law. Aside from an investment implementation report and an investment amendment report that are required for each investment and alteration of investment specifics, an annual report is mandatory, and large foreign investors meeting certain criteria are required to report on a quarterly basis. Any company found to be noncompliant with these information reporting obligations may potentially be subject to fines and/or administrative or criminal liabilities, and the persons directly responsible may be subject to criminal liabilities.
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Changes in the policies of the PRC government could have a significant impact upon our ability to operate profitably in the PRC.
Currently, we conduct all of our operations and all of our revenue is generated in the PRC. Accordingly, economic, political and legal developments in the PRC will significantly affect our business, financial condition, results of operations and prospects. Policies of the PRC government can have significant effects on economic conditions in the PRC and the ability of businesses to operate profitably. Our ability to operate profitably in the PRC may be adversely affected by changes in policies by the PRC government, including changes in laws, regulations or their interpretation that may affect our ability to operate as currently contemplated.
Because our business is dependent upon government policies that encourage a market-based economy, changes in the political or economic climate in the PRC may impair our ability to operate profitably, if at all.
Although the PRC government has been pursuing a number of economic reform policies for more than two decades, the PRC government continues to exercise significant control over economic growth in the PRC. Because of the nature of our business, we are dependent upon the PRC government pursuing policies that encourage private ownership of businesses. Restrictions on private ownership of businesses would affect the securities business in general and businesses using real estate services in particular. We cannot assure you that the PRC government will pursue policies favoring a market-oriented economy or that existing policies will not be significantly altered, especially in the event of a change in leadership, social or political disruption, or other circumstances affecting political, economic and social life in the PRC.
PRC laws and regulations governing our current business operations are sometimes vague and uncertain and any changes in such laws and regulations may impair our ability to operate profitably.
There are substantial uncertainties regarding the interpretation and application of PRC laws and regulations including, but not limited to, the laws and regulations governing our business and the enforcement and performance of our arrangements with customers in certain circumstances. The laws and regulations are sometimes vague and may be subject to future changes, and their official interpretation and enforcement may involve substantial uncertainty. The effectiveness and interpretation of newly enacted laws or regulations, including amendments to existing laws and regulations, may be delayed, and our business may be affected if we rely on laws and regulations which are subsequently adopted or interpreted in a manner different from our understanding of these laws and regulations. New laws and regulations that affect existing and proposed future businesses may also be applied retroactively. We cannot predict what effect the interpretation of existing or new PRC laws or regulations may have on our business.
Because our business is conducted in RMB and the price of our Common Stock is quoted in United States dollars, changes in currency conversion rates may affect the value of your investments.
Our business is conducted in the PRC, our books and records are maintained in RMB, which is the currency of the PRC, and the financial statements that we file with the SEC and provide to our shareholders are presented in United States dollars. Changes in the exchange rate between the RMB and dollar affect the value of our assets and the results of our operations in United States dollars. The value of the RMB against the United States dollar and other currencies may fluctuate and is affected by, among other things, changes in the PRC’s political and economic conditions and perceived changes in the economy of the PRC and the United States. Any significant revaluation of the RMB may materially and adversely affect our cash flows, revenue and financial condition. Further, our Common Stock offered by this prospectus are denominated in United States dollars, we will need to convert the net proceeds we receive into RMB in order to use the funds for our business. Changes in the conversion rate between the United States dollar and the RMB will affect that amount of proceeds we will have available for our business.
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Risks Related to Our Common Stock
Our securities are “Penny Stock” and subject to specific rules governing their sale to investors.
Under SEC Rule 15g-9 we are a “penny stock,” which is defined as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a person’s account for transactions in penny stocks; and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.
To approve a person’s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person; and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.
The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination; and that the broker or dealer received a signed, written agreement from the investor prior to the transaction.
Generally, brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for Company’s shareholders to sell shares of our common stock.
Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.
Because we became public by means of a merger, we may not be able to attract the attention of major brokerage firms.
Additional risks may exist since we became public through a merger with a publicly traded company. Securities analysts of major brokerage firms may not provide coverage of us since there is little incentive to brokerage firms to recommend the purchase of our common stock. No assurance can be given that brokerage firms will want to conduct any secondary offerings on our behalf in the future.
Compliance with the reporting requirements of federal securities laws can be expensive.
We will become a fully reporting company upon the effectiveness of this offering and will be subject to the information and reporting requirements of the Exchange Act and other federal securities laws and the compliance obligations of the Sarbanes-Oxley Act. The costs of preparing and filing annual and quarterly reports and other information with the SEC and furnishing audited reports to stockholders are substantial.
9
Applicable regulatory requirements, including those contained in and issued under the Sarbanes-Oxley Act of 2002, may make it difficult for us to retain or attract qualified officers and directors, which could adversely affect the management of our business and our ability to obtain or retain listing of our common stock.
As a fully reporting company under Section 13 of the Exchange Act, we may be unable to attract and retain those qualified officers, directors and members of board committees required to provide for effective management because of the rules and regulations that govern publicly held companies, including, but not limited to, certifications by principal executive officers. The enactment of the Sarbanes-Oxley Act has resulted in the issuance of a series of related rules and regulations and the strengthening of existing rules and regulations by the SEC, as well as the adoption of new and more stringent rules by the stock exchanges. The perceived increased personal risk associated with these changes may deter qualified individuals from accepting roles as directors and executive officers.
Further, some of these changes heighten the requirements for board or committee membership, particularly with respect to an individual’s independence from the corporation and level of experience in finance and accounting matters. We may have difficulty attracting and retaining directors with the requisite qualifications. If we are unable to attract and retain qualified officers and directors, the management of our business and its ability to obtain or retain listing of our shares of common stock on any stock exchange (assuming we elect to seek and are successful in obtaining such listing) could be adversely affected.
If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results or detect fraud. Consequently, investors could lose confidence in our financial reporting and this may decrease the trading price of our stock.
We must maintain effective internal controls to provide reliable financial reports and detect fraud. We have been assessing our internal controls to identify areas that need improvement. Failure to identify and thereafter implement required changes to our internal controls or any others that we identify as necessary to maintain an effective system of internal controls, if any, could harm our operating results and cause investors to lose confidence in our reported financial information. Any such loss of confidence would have a negative effect on the trading price of our stock.
The price of our common stock may become volatile, which could lead to losses by investors and costly securities litigation.
The trading price of our common stock is likely to be highly volatile and could fluctuate in response to factors such as:
| ● | actual or anticipated variations in our operating results; | |
| ● | announcements of developments by us or our competitors; | |
| ● | regulatory actions regarding our products; | |
| ● | announcements by us or our competitors of significant acquisitions, strategic partnerships, joint ventures or capital commitments; | |
| ● | adoption of new accounting standards affecting our industry; | |
| ● | additions or departures of key personnel; | |
| ● | introduction of new products by us or our competitors; | |
| ● | sales of our common stock or other securities in the open market; and | |
| ● | Other events or factors, many of which are beyond our control such as the continuation of disruptions due to COVID-19. |
The stock market is subject to significant price and volume fluctuations. In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been initiated against such a company. Litigation initiated against us, whether or not successful, could result in substantial costs and diversion of its management’s attention and resources, which could harm our business and financial condition.
10
Our common stock is controlled by insiders.
Our officers and directors beneficially own approximately 80% of our outstanding shares of common stock. Such concentrated control may adversely affect the price of our common stock. Investors who acquire common stock may have no effective voice in our management. Sales by our insiders or affiliates, along with any other market transactions, could negatively affect the market price of our common stock.
If we do not meet the listing standards of a national securities exchange our investors’ ability to make transactions in our securities will be limited, and we will be subject to additional trading restrictions.
Our securities currently are traded over-the-counter on the OTC Pink and are not qualified to be listed on a national securities exchange, such as NASDAQ. Accordingly, we face significant material adverse consequences, including:
| ● | a limited availability of market quotations for our securities; |
| ● | reduced liquidity with respect to our securities; |
| ● | our shares of common stock are currently classified as “penny stock” which requires brokers trading in our shares of common stock to adhere to more stringent rules, resulting in a reduced level of trading activity in the secondary trading market for our shares of common stock; |
| ● | a limited amount of news and analyst coverage for our company; and |
| ● | a decreased ability to issue additional securities or obtain additional financing in the future. |
The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Since our Common Stock is traded on OTC Pink, our common stock is a covered security. Although the states are preempted from regulating the sale of our securities, the federal statute allows the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Further, if we were no longer traded over-the-counter, our common stock would not be a covered security and we would be subject to regulation in each state in which we offer our securities.
Because we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain.
We have never declared or paid cash dividends on our capital stock. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. In addition, the terms of any future debt agreements may preclude us from paying dividends. As a result, capital appreciation, if any, of our securities will be your sole source of gain for the foreseeable future.
Cautionary Note
We have sought to identify what we believe to be the most significant risks to our business, but we cannot predict whether, or to what extent, any of such risks may be realized nor can we guarantee that we have identified all possible risks that might arise. Investors should carefully consider all of such risk factors before making an investment decision with respect to our common stock.
11
CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS
This prospectus contains forward-looking statements. These statements relate to future events or our future financial performance. We have attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “should” or “will” or the negative of these terms or other comparable terminology.
These statements are only predictions and involve known and unknown risks, uncertainties, and other factors, including those discussed under “Risk Factors.” The following factors, among others, could cause our actual results and performance to differ materially from the results and performance projected in, or implied by, the forward-looking statements:
| ● | the success of our existing and new technologies; |
| ● | our ability to successfully develop and expand our operations; |
| ● | changes in economic conditions, including continuing effects from the recent recession; |
| ● | damage to our reputation or lack of acceptance of our brands; |
| ● | economic and other trends and developments, including adverse weather conditions, in those local or regional areas in which our operations are concentrated; |
| ● | increases in our labor costs, including as a result of changes in government regulation; |
| ● | labor shortages or increased labor costs; |
| ● | increasing competition in the industry in general; |
| ● | changes in attitudes or negative publicity regarding drug safety and health concerns; |
| ● | the success of our marketing programs; |
| ● | potential fluctuations in our quarterly operating results due to new products and other factors; |
| ● | the effect on existing products of focusing on other products in the same markets; |
| ● | of our management team; |
| ● | strain on our infrastructure and resources caused by our growth; |
| ● | the impact of federal, state or local government regulations relating to the industry; |
| ● | the impact of litigation; |
| ● | statements regarding our goals, intentions, plans and expectations, including the introduction of new products and markets and locations we intend to target in the future; |
| ● | statements regarding the anticipated timing and impact of our pending acquisitions; |
| ● | statement regarding our expectation with respect to the potential issuance of stock or shares in connection with our acquisitions or in connection with providing services to client companies.; and |
| ● | statement with respect to having adequate liquidity. |
12
The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:
| ● | changes in the pace of legislation; |
| ● | other regulatory developments that could limit the market for our products; |
| ● | our ability to successfully integrate acquired entities; |
| ● | competitive developments, including the possibility of new entrants into our primary markets; |
| ● | the loss of key personnel; and |
| ● | other risks discussed in this document. |
All forward-looking statements in this document are based on information currently available to us as of the date of this prospectus, and we assume no obligation to update any forward-looking statements other than as required by law.
13
Because the offering is a best-efforts offering, we are presenting this information assuming that we sell 25%, 50%, 75%, and 100% of the shares offered hereby. For the purposes of this table, we used $0,01, the per-share offering price.
| 100% | 75% | 50% | 25% | |||||||||||||
| Gross Offering Proceeds | $ | 1,000,000 | $ | 750,000 | $ | 500,000 | $ | 250,000 | ||||||||
| Offering Costs | $ | 70,000 | $ | 70,000 | $ | 70,000 | $ | 70,000 | ||||||||
| Use of Net Proceeds: | ||||||||||||||||
| Working Capital | $ | 930,000 | $ | 680,000 | $ | 430,000 | $ | 180,000 | ||||||||
We intend to use the net proceeds as follows:
Expansion of Company’s administrative offices, additional staffing in sales, marketing and support personnel, working capital and general corporate purposes.
General and administrative expenses pertain to operating expenses rather than to expenses that can be directly related to the production of any goods or services, utilities, insurance and managerial salaries which may come at a later date.
This expected use of the net proceeds from this offering and our existing cash, cash equivalents and short-term investments represent our intentions based upon our current plans and business conditions. The amounts and timing of our actual expenditures may vary significantly depending on numerous factors, including the progress of our development and commercialization efforts, the status of and results from clinical trials, as well as any collaborations that we may enter into with third parties, and any unforeseen cash needs. As a result, our management will retain broad discretion over the allocation of the net proceeds from this offering. We have no current agreements, commitments or understandings for any material acquisitions or licenses of any products, businesses or technologies.
Our management will have broad discretion over the uses of the net proceeds from this offering. Pending these uses, we intend to invest the net proceeds from this offering in a variety of capital preservation investments, including short-term, interest-bearing investment grade securities, money market accounts, certificates of deposit and direct or guaranteed obligations of the U.S. government.
14
DETERMINATION OF OFFERING PRICE
We currently expect the offering price to be $0,01 per share of our common stock for the shares of stock being offered by us pursuant to this prospectus.
The offering price of the common stock has been arbitrarily determined by our board of directors and bears no relationship to any objective criterion of value. The price does not bear any relationship to the Company’s assets, book value, historical earnings or net worth. In determining the offering price, the board of directors considered such factors as the lack of recent trading prices of the common stock, the board’s perception of our future prospects, past and anticipated operating results, present financial resources and the likelihood of selling the shares of common stock offered hereby. Accordingly, the offering price should not be considered an indication of the actual value of the Company or the common stock.
As noted above you should not consider the offering price as an indication of the value of our common stock. You should not assume or expect that, after the offering, our shares of common stock will trade at or above the offering price in any given time period. Our stock is not quoted on any major stock market. The market price of our common stock may decline during or after the offering, and you may not be able to sell the underlying shares of our common stock purchased during the offering at a price equal to or greater than the offering price. You should obtain advice from your financial advisor before purchasing shares and make your own assessment of our business and financial condition, our prospects for the future, and the terms of the offering.
15
The offering price of the Shares of Common Stock being offered for sale pursuant to this Offering is substantially higher than the book value per share of the Common Stock. Accordingly, investors purchasing the Shares pursuant to this Offering will experience an immediate and significant dilution in the book value per share of the Shares purchased. We may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. To the extent additional capital is raised through the sale of equity or convertible debt securities, the issuance of these securities could result in further dilution to our stockholders. See Management’s Discussion and Analysis—We may require additional capital to finance our operations in the future, but that capital may not be available when it is needed and could be dilutive to existing stockholders and we can sell additional shares of common stock without consulting stockholders and without offering shares to existing stockholders, which would result in dilution of stockholders’ interests in SSHT S&T Group Ltd. and could depress our stock price.
The price of the current offering is fixed at $0.01 per common share.
Assuming completion of the offering, there will be up to 209,903,473 common shares outstanding. The following table illustrates the per common share dilution that may be experienced by investors at various funding levels based on the Company’s net tangible book value of ($57,804) as of December 31, 2022.
| Funding Level | 100% | 75% | 50% | 25% | ||||||||||||
| Gross Proceeds | $ | 1,000,000 | $ | 750,000 | $ | 500,000 | $ | 250,000 | ||||||||
| Offering Price | $ | 0.01 | $ | 0.01 | $ | 0.01 | $ | 0.01 | ||||||||
| Net Tangible Book Value per Share of Common Stock before this Offering | $ | (0.000526 | ) | $ | (0.000526 | ) | $ | (0.000526 | ) | $ | (0.000526 | ) | ||||
| Increase in Net Tangible Book Value per Share Attributable to New Investors in this Offering | $ | 0.005015 | $ | 0.004270 | $ | 0.003291 | $ | 0.001951 | ||||||||
| Net Tangible Book Value per Share of Common Stock after this Offering | $ | 0.004489 | $ | 0.003744 | $ | 0.002765 | $ | 0.001425 | ||||||||
| Dilution per share to Investors in the Offering | $ | (0.005511 | ) | $ | (0.006256 | ) | $ | (0.007235 | ) | $ | (0.008575 | ) |
16
MARKET
FOR REGISTRANT’S COMMON STOCK, DIVIDEND POLICY AND
RELATED STOCKHOLDER MATTERS
Market Information.
Our common stock is qualified for quotation on the OTC Markets-OTC Pink under the symbol “SSHT”. Previously, our common stock was quoted on the OTC Markets-OTC Pink, under the symbol “WDSL.” The following table sets forth the range of the high and low bid prices per share of our common stock for each quarter of our fiscal year (based on a December 31 fiscal year end) as reported in the over-the-counter markets. These quotations represent interdealer prices, without retail markup, markdown or commission, and may not represent actual transactions. There currently is a minimal liquid trading market for our common stock. There can be no assurance that a significant active trading market in our common stock will develop, or if such a market develops, that it will be sustained.
| 2022 | ||||||||
| High | Low | |||||||
| First Quarter (through March 31) | $ | 1.50 | $ | 0.51 | ||||
| Second Quarter (through June 30) | 0.9999 | 0.51 | ||||||
| Third Quarter (through September 30) | 1.09 | 0.25 | ||||||
| Fourth Quarter (through December 31) | 4.10 | 0.4008 | ||||||
| 2021 | ||||||||
| High | Low | |||||||
| First Quarter (through March 31) | $ | 2.34 | $ | 0.10 | ||||
| Second Quarter (through June 30) | 0.513 | 0.15 | ||||||
| Third Quarter (through September 30) | 0.31 | 0.1001 | ||||||
| Fourth Quarter (through December 31) | 0.795 | 0.0497 | ||||||
The ability of individual stockholders to trade their shares in a particular state may be subject to various rules and regulations of that state. A number of states require that an issuer’s securities be registered in their state or appropriately exempted from registration before the securities are permitted to trade in that state. At present, we have no plans to register our securities in any particular state. Further, our shares may be subject to the provisions of Section 15(g) and Rule 15g-9 of the Exchange Act, commonly referred to as the “penny stock” rule. Section 15(g) sets forth certain requirements for transactions in penny stocks and Rule 15g-9(d)(1) incorporates the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act.
The SEC generally defines penny stock to be any equity security that has a market price less than $5.00 per share, subject to certain exceptions. Rule 3a51-1 provides that any equity security is considered to be a penny stock unless that security is: registered and traded on a national securities exchange meeting specified criteria set by the SEC; authorized for quotation on The NASDAQ Stock Market; issued by a registered investment company; excluded from the definition on the basis of price (at least $5.00 per share) or the issuer’s net tangible assets; or exempted from the definition by the SEC. Broker-dealers who sell penny stocks to persons other than established customers and accredited investors (generally persons with assets in excess of $1,000,000 or annual income exceeding $200,000 by an individual, or $300,000 together with his or her spouse), are subject to additional sales practice requirements.
For transactions covered by these rules, broker-dealers must make a special suitability determination for the purchase of such securities and must have received the purchaser’s written consent to the transaction prior to the purchase. Additionally, for any transaction involving a penny stock, unless exempt, the rules require the delivery, prior to the first transaction, of a risk disclosure document relating to the penny stock market. A broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative, and current quotations for the securities. Finally, monthly statements must be sent to clients disclosing recent price information for the penny stocks held in the account and information on the limited market in penny stocks. Consequently, these rules may restrict the ability of broker-dealers to trade and/or maintain a market in our common stock and may affect the ability of stockholders to sell their shares.
17
We have not previously filed a registration statement under the Securities Act. Shares sold pursuant to exemptions from registration are deemed to be “restricted” securities as defined by the Securities Act. As of April 10, 2023, out of a total of 1,000,000,000 shares authorized, 109,903,473 shares are issued as restricted securities and can only be sold or otherwise transferred pursuant to a registration statement under the Securities Act or pursuant to an available exemption from registration. Of such restricted shares, 87,300,000 (79.4%) shares are held by affiliates (directors, officers and 10% holders), with the balance of 22,603,473 (20.6%) shares being held by non-affiliates.
In general, under Rule 144 as currently in effect, a person (or persons whose shares are aggregated) who has beneficially owned restricted shares of a reporting company for at least six months, including any person who may be deemed to be an “affiliate” of the company (as the term “affiliate” is defined under the Securities Act), is entitled to sell, within any three-month period, an amount of shares that does not exceed the greater of (i) the average weekly trading volume in the company’s common stock, as reported through the automated quotation system of a registered securities association, during the four calendar weeks preceding such sale or (ii) 1% of the shares then outstanding. In order for a stockholder to rely on Rule 144, adequate current public information with respect to the company must be available. A person who is not deemed to be an affiliate of the company and has not been an affiliate for the most recent three months, and who has held restricted shares for at least one year is entitled to sell such shares without regard to the various resale limitations under Rule 144. Under Rule 144, the requirements of paragraphs (c), (e), (f), and (h) of such Rule do not apply to restricted securities sold for the account of a person who is not an affiliate of an issuer at the time of the sale and has not been an affiliate during the preceding three months, provided the securities have been beneficially owned by the seller for a period of at least one year prior to their sale. For the purposes of this registration statement, a controlling stockholder is considered to be a person who owns 10% or more of the company’s total outstanding shares, or is otherwise an affiliate of the Company. No individual person owning shares that are considered to be not restricted owns more than 10% of the Company’s total outstanding shares.
Holders
As of December 31, 2022, we had 331 shareholders of common stock per our transfer agent’s shareholder list.
Dividends
The Company has not paid any cash dividends to date and does not anticipate or contemplate paying any dividends in the foreseeable future. It is the present intention of management to utilize all available funds for the growth of the Registrant’s business.
Equity Compensation Plan Information
The Company has not yet adopted an equity compensation plan as of December 31, 2022, or subsequently through the filing of this registration statement.
18
Management’s
Discussion and Analysis of Financial Condition and
Results of Operation
We are a consulting company offering financial consulting services to small and medium-sized enterprise customers in China. Our goal is to become a national financial consulting company with clients and offices throughout China. Since our inception in 2019, we have primarily focused on helping clients going public on the U.S. OTC markets and exchanges, but we are in the process of expanding our service to listing clients on domestic exchanges in China as well as the Hong Kong Stock Exchange. In 2022, we entered into consulting agreements with two enterprises, which became public companies in the U.S. by being quoted on the OTC market in 2022 under our guidance. As of the date of this registration statement, all our clients are based in south-eastern region of China; however, we plan to expand our operations throughout China in the future. Our business expansion has benefited from the growing financial consultancy market in China, which is driven by factors including rising financing activities, strong government support in terms of regulations and policies, and growing awareness of the importance of financial consultancy by more Chinese enterprises.
Key Factors that Affect Operating Results
We believe the following key factors may affect our financial condition and results of operations:
Our business success depends on our ability to acquire customers effectively.
Our ability to increase our revenue largely depends on our ability to attract and engage potential customers. Our sales and marketing efforts include those related to customer acquisition and retention, and general marketing. We intend to continue to dedicate significant resources to our sales and marketing efforts and constantly seek to improve the effectiveness of these efforts to grow our revenues. Our customer acquisition channels primarily include our sales and marketing campaigns and existing customer referrals. In order to acquire customers, we have made significant efforts in building mutually beneficial long-term relationships with local governments, academic institutions, and local business associations. In addition, we also market our consulting services through social media, such as WeChat or Weibo. If any of our current customer acquisition channels becomes less effective, if we are unable to continue to use any of these channels, or if we are not successful in using new channels, we may not be able to attract new customers in a cost-effective manner or convert potential customers into active customers or even lose our existing customers to our competitors. To the extent that our current customer acquisition and retention efforts becomes less effective, our service revenue may be significantly impacted, which would have a significant adverse effect on our revenues, financial condition and results of operations.
Our consulting business faces strong market competition.
We are currently facing intense market competition. Some of our current or potential competitors have significantly more financial, technical, marketing and other resources than we do and may be able to devote greater resources to the development, promotion, and support of their customer acquisition and retention channels. Considering the low barriers to entry into the financial consulting industry, we expect more players to enter this market and increase the level of competition. Our ability to differentiate our services from other competitors will have a significant impact on our business growth in the future.
Changes in the PRC Regulatory Environment may impact our business and the results of operations.
The regulatory environment for the financial consulting industry in China is evolving. Recently, many local governments have established various subsidization schemes and policies to stimulate and encourage local business enterprises to go public, this may stimulate the growth of more financial consulting firms to become new players given the low barrier of entry into the financial consulting industry as well. As more players enter the competition, PRC governmental authorities may publish and promulgate various new laws and rules to regulate the financial consulting marketplace. We have been closely tracking the development and implementation of new rules and regulations likely to affect us. We will continue to ensure timely compliance with any new rules and regulations and believe that such timely compliance is essential to our growth. To the extent that we may be required to adapt our operations to new laws and regulations, our operating costs may increase, which will impact our profitability.
19
Since our inception until December 31, 2022, the close of our last full fiscal year, our revenue was mainly generated from our going public consulting services. We also generated a small portion of our revenue from back-office support, financial accounting, listing support, and support for mergers and acquisitions. We generated a total revenue of approximately US$330,525, for the fiscal years ended December 31, 2022. The revenues generated from going public consulting services were around $300,000 for the fiscal years ended December 31, 2022. Our net loss was $76,831 for the year ended December 31, 2021, and increased to a net income of $437 for the year ended December 31, 2022.
In fiscal year 2022, we entered into consulting agreements with two enterprises, which became public companies in the U.S. through reverse merger transactions. by being quoted on the OTC market in 2022 under our guidance. In fiscal year 2021, we lacked internal resources to provide legal and accounting advisory services and had limited shell company identification channel. As a result, we had to outsource some of the services to third-party service providers to assist us by providing the consulting services we promised to our customers. As we accumulated more experiences in fiscal year 2022, we have brought many outsourced services in house to save costs in fiscal year 2023.
Results of Operations
Year ended December 31, 2021, compared to the year ended December 31, 2021
| Year ended | ||||||||||||||||
| December 31, | December 31, | |||||||||||||||
| 2022 | 2021 | $ Change | % Change | |||||||||||||
| Revenues | $ | 330,525 | $ | - | $ | 330,525 | 100.0 | % | ||||||||
| Cost of sales | - | - | - | - | ||||||||||||
| Gross profit | 330,525 | 330,525 | 100.0 | % | ||||||||||||
| Operating Expenses: | ||||||||||||||||
| General and administrative | 319,095 | 76,716 | 242,379 | 415.9 | % | |||||||||||
| Total operating expenses | 319,095 | 76,716 | 242,379 | 415.9 | % | |||||||||||
| Income (loss) from operations | 11,430 | (76,716 | ) | 88,146 | 114.8 | % | ||||||||||
| Other Expense | ||||||||||||||||
| Interest expense | (82 | ) | (7 | ) | 75 | (1,071.4 | )% | |||||||||
| Other expense | 9,379 | - | 9,379 | 100.0 | % | |||||||||||
| Bank charges | 204 | 122 | 82 | 67.2 | % | |||||||||||
| Total other expense | 9,501 | 115 | 9,386 | 8,161.7 | % | |||||||||||
| Income (loss) before taxes | 1,929 | (76,831 | ) | 78,760 | 102.5 | % | ||||||||||
| Income tax expense | 1,492 | - | 1,492 | 100.0 | % | |||||||||||
| Net income (loss) | $ | 437 | $ | (76,831 | ) | $ | 77,268 | 100.5 | % | |||||||
Revenue
During the year ended December 31, 2022, compared to the year ended December 31, 2021, the revenue increased by $330,525 due to the Company’s acquisition of WHL and commencing operations through WFOE. The gross profit also increased by $330,525.
The significant increase in gross profit was affected by the Company’s acquisition of WHL which brought existing operations and personnel and by refocusing from being a provider of wireless data solutions to a provider of business advisory services.
20
Expenses
The Company experienced an increase in expenses during the period ended on December 31, 2022, compared to the period ended December 31, 2022, due to significant increases in the general and administrative expenses associated with its business advisory services.
Liquidity and Capital Resources
Net Cash Provided by (Used in) Operating Activities
Net cash provided by (used in) operating activities for the years ended December 31, 2022, and 2021 was $(50,821) and $1,818, respectively.
Net cash used in operating activities during the year ended December 31, 2022 was due to net income of $437, which was decreased by amounts due to related parties of $(34,116), accounts payable and accrued liabilities in the amount of $(15,692), and accounts receivable in the amount of $(1,450). During the year ended December 31, 2021, net cash used in operating activities was comprised of net loss of $(76,831) offset by amounts due to related parties of $93,717, accounts payable and accrued liabilities in the amount of $(17,181), and accounts receivable in the amount of $2,113.
Net Cash Provided by Financing Activities
Net cash provided by financing activities for the years ended December 31, 2022, and 2021 was $65,800 and $-, respectively. This was the result of common stock issued for cash of $65,800 and $- during the years ended December 31, 2022 and 2021, respectively.
Off-Balance Sheet Arrangements
As of December 31, 2022, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.
Going Concern
The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company had an accumulated deficit of $(2,543,986) on December 31, 2022, with an accumulated deficit of $(2,544,423) at December 31, 2021. The Company had net income attributable to the Company of $437 for the year ended December 31, 2022, and net loss attributable to the Company of $76,831 for the year ended December 31, 2021. The Company’s ability to continue as a going concern is dependent upon its ability to generate positive cash flow from an operating company, and/or raise capital through equity and debt financing or other means on desirable terms. If the Company is unable to obtain additional funds when they are required or if the funds cannot be obtained on favorable terms, management may be required to restructure the Company or cease operations. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.
Critical Accounting Policies
We have identified the policies in the attached financial statements as critical to our business operations and an understanding of our results of operations. The list is not intended to be a comprehensive list of all of our accounting policies. In many cases, the accounting treatment of a particular transaction is specifically dictated by accounting principles generally accepted in the United States, with no need for management’s judgment in their application. The impact and any associated risks related to these policies on our business operations is discussed throughout Management’s Discussion and Analysis of Financial Condition and Results of Operation where such policies affect our reported and expected financial results. Note that our preparation of the consolidated financial statements requires us to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities at the date of our consolidated financial statements, and the reported amounts of revenue and expenses during the reporting period. There can be no assurance that actual results will not differ from those estimates. For more information, see “Note 2 – Summary of Significant Accounting Policies” in the attached financial statements.
21
Additional Company Matters
On March 11, 2019, the 8th District Court in the State of Nevada appointed Harry Zhang as custodian of the Company. Custodianship was discharged on September 8, 2021.
We may from time to time be involved in various claims and legal proceedings of a nature we believe are normal and incidental to our business. These matters may include product liability, employment, personal injury caused by our employees, and other general claims.
We are not presently a party to any legal proceedings.
22
MANAGEMENT DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The following table contains information with respect to our directors and executive officers. To the best of our knowledge, none of our directors or executive officers have an arrangement or understanding with any other person pursuant to which he or she was selected as a director or officer. There are no family relationships between any of our directors or executive officers. Directors serve one-year terms. Our executive officers are appointed by and serve at the pleasure of the Board of Directors.
| Name | Current Age | Position | ||
| Zonghan Wu | 44 | President, CEO, Treasurer, Chairman of the Board of Directors |
Zonghan Wu
Mr. Wu worked for Opus International Consultants as a Business Analyst in New Zealand from 2004 to 2007. He worked for Nestle as a Commercial Analyst from 2008 to 2011. Currently he is Managing Director of Shanghai JAZ Management Consulting Co. Ltd in Shanghai. Mr. Wu is currently Chairman and Company Secretary for the following public companies listed in the U.S.: SSHT S&T Group Ltd. (OTC Pink: SSHT) and Alpine Auto Brokers Inc. (OTC Pink: ALTB). Mr. Wu is also a Director and Company Secretary for the following public companies listed in the U.S.: Alliance Recovery Corp. (OTC Pink: ARVY), ACC Aviation Holdings Ltd. OTC Pink: CAVG), Interact Holdings Group, Inc. (OTC Pink: IHGP), Linike Medical Group Ltd. (OTC Pink: LNMG), Providence Resources, Inc. (OTC Pink: PVRS), SIPP international Industries, Inc. (OTC Pink: SIPN), ZKGC New Energy Ltd. (OTC Pink: ZKGCF) and Victor Mining Industry Group, Inc. (OTC Pink: VMTG). Mr. Wu was awarded a Bachelor of Commerce degree from the University of Auckland in New Zealand in 2004.
Family Relationships.
There are no family relationships between any of our directors or executive officers.
Involvement in Certain Legal Proceedings.
There have been no events under any bankruptcy act, any criminal proceedings and any judgments, injunctions, orders or decrees material to the evaluation of the ability and integrity of any director, executive officer, promoter or control person of the Company during the past five years.
Summary Compensation Table
The following summary compensation table sets forth all compensation awarded to, earned by, or paid to the named executive officers paid by us during the current fiscal year and the fiscal years ended December 31, 2022, and 2021.
23
EXECUTIVE OFFICER COMPENSATION TABLE (FISCAL YEAR)
| Name/Position | Year | Salary (1) |
Bonus (2) |
Stock
Awards (3) |
All
Other Comp. (4) |
Total | |||||||||||||||||
Zonghan Wu (Officer/Director) |
2022 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
| 2021 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Zhibin Chen (former officer/director) |
2022 | 0 | 0 | 55,800,000 common Shares |
55,800,000 common shares |
55,800,000 common shares |
|||||||||||||||||
| 2021 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Haining (Harry) Zhang (former officer/director, custodian) |
2022 | 0 | 0 | 34,500,000 common Shares |
34,500,000 common Shares |
34,500,000 common Shares |
|||||||||||||||||
| 2021 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Zhibin Chen: 55,800,000 common Shares issued to SSHT International Holdings Limited (a BVI Co. controlled by Zhibin Chen) for Mr Chen’s director & officer’s services.
Haining (Harry) Zhang: 31,500,000 common shares issued to Haining Zhang, and 3,000,000 common shares issued to Quanleap, LLC (controlled by Harry Zhang) for his director & officer’s services.
Outstanding Equity Awards at the End of the Fiscal Year
We do not have any equity compensation plans and, therefore, no equity awards are outstanding as of December 31, 2022.
Bonuses and Deferred Compensation
We do not have any deferred compensation or retirement plans. All decisions regarding compensation are determined by our Board of Directors.
Options and Stock Appreciation Rights
As of December 31, 2022, no options have been issued.
Payment of Post-Termination Compensation
We do not have change-in-control agreements with our director or executive officer.
Employment Agreements
The Company does not currently have any agreements nor compensation with employees as of the date of this filing.
Director Agreements
The Company does not currently have any agreements nor compensation with members of the Board of Directors as of the date of this filing.
Board of Directors
Our directors hold office until the next annual meeting of shareholders and until their successors have been duly elected and qualified. Our officers are elected by and serve at the discretion of the Board of Directors.
24
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Restricted Stock Awards to Certain Officers and Directors
From March 2021 through July 2021, the Company issued a cumulative total of 34,500,000 shares of Common stock to Haining Zhang or entities owned and controlled by Mr. Zhang for consulting services.
On February 11, 2022, the Company issued 55,800,000 shares of Common stock to SSHT International Holding Limited, an entity controlled by our sole officer and director, Zonghan Wu. The shares were issued in consideration of consulting services provided by Mr. Wu.
25
Plan of Distribution for SSHT S&T Group Ltd.’s Public Offering of 100,000,000 Shares of Common Stock
This is a self-underwritten (“best-efforts”) offering. This prospectus is part of a registration statement that permits our officers and directors to sell the shares being offered by the Company directly to the public, with no commission or other remuneration payable to them for any shares they may sell. Presently, we expect that our officers and directors will personally contact existing shareholders, friends, family members and business acquaintances and inform them about the offering. In addition, we may market the offering to institutional investors through our officers and directors. We may also offer our shares of common stock through brokers, dealers or agents, although we have no current plans or arrangements to do so. The company has been contacted by multiple financial institutions, as well as fielded interest from existing shareholders that give the Company assurance as to the marketability of its shares to these identified parties. This offering will terminate on the date which is 270 days from the effective date of this prospectus, although we may close the offering on any date prior if the offering is fully subscribed to or upon the vote of our board of directors.
In offering the securities on our behalf, our officers and directors will rely on the safe harbor from broker dealer registration set forth in Rule 3a4-1 under the Exchange Act. The officers and directors will not register as broker-dealers pursuant to Section 15 of the Exchange Act, in reliance upon Rule 3a4-1, which sets forth those conditions under which a person associated with an issuer may participate in the offering of the Issuer’s securities and not be deemed to be a broker-dealer. In that regard, we confirm that:
| a. | None of our officers or directors are subject to a statutory disqualification, as that term is defined in Section 3(a)(39) of the Exchange Act; |
| b. | None of our officers or directors will be compensated in connection with their participation by the payment of commissions or other remuneration based either directly or indirectly on transactions in the common stock; |
| c. | None of our officers or directors is or will be, at the time of his participation in the offering, an associated person of a broker-dealer; and |
| d. | Our officers and directors meet the conditions of paragraph (a)(4)(ii) of Rule 3a4-1 of the Exchange Act, in that each (A) primarily perform substantial duties for or on our behalf, other than in connection with transactions in securities, and (B) is not a broker or dealer, or has been an associated person of a broker or dealer, within the preceding 12 months, and (C) has not participated in selling and offering securities for any issuer more than once every 12 months other than in reliance on Paragraphs (a)(4)(i) or (a)(4)(iii) of Rule 3a4-1. |
None of our officers or directors, control persons or affiliates intend to purchase any shares in this offering.
26
DESCRIPTION OF SECURITIES TO BE REGISTERED
The following is a summary of the rights of our Common Stock. This summary does not purport to be complete and is qualified in its entirety by the provisions of our articles of incorporation, bylaws and the Certificates of Designation (as defined below) of our preferred stock, copies of which are filed as exhibits to the registration statement, and to the applicable provisions of Nevada law. The Company is authorized by its Certificate of Incorporation to issue an aggregate of 1,000,000,000 shares of common stock, $0.001 par value per share (the “Common Stock”), and -0- shares of preferred. As of April 10, 2023, 109,903,473 shares of Common Stock were issued and outstanding.
Common Stock
Dividend Rights
Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of our Common Stock may receive dividends out of funds legally available if our Board, in its discretion, determines to issue dividends and then only at the times and in the amounts that our Board may determine. We have not paid any dividends on our Common Stock and do not contemplate doing so in the foreseeable future.
Voting Rights
Each stockholder is entitled to one vote for each share of common stock held by such shareholder.
Right to Receive Liquidation Distribution
Holders of common stock are entitled to dividends when, and if, declared by the Board of Directors out of funds legally available; therefore, and then, only after all preferential dividends have been paid on any outstanding Preferred Stock. The Company has not had any earnings and it does not presently contemplate the payment of any cash dividends in the foreseeable future.
Transfer Agent and Registrar
The transfer agent and registrar for our Common Stock is Colonial Stock Transfer Co., Inc. with an address at 7840 S 700 E, Sandy, UT 84070. Their phone number is (801) 355-5740.
The audited and consolidated financial statements for the fiscal years ended December 31, 2022 and 2021 included in this registration statement have been so included in reliance upon the report of Shandong Haoxin Certified Public Accountants Co., Ltd, an independent registered public accounting firm, appearing elsewhere herein and in the registration statement, given on the authority of said firm as experts in auditing and accounting.
JDT Legal, PLLC, of So. Jordan, Utah, will issue to SSHT S&T Group Ltd. its opinion regarding the legality of the common stock being offered hereby. JDT Legal, PLLC has consented to the references in this prospectus to its opinion.
27
INTEREST OF NAMED EXPERTS AND COUNSEL
No expert or counsel named in this Prospectus as having prepared or certified any part of this Prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or Offering of the Common Stock was employed on a contingency basis, or had, or is to receive, in connection with the Offering, a substantial interest, direct or indirect, in the registrant. Nor was any such person connected with the registrant as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.
JDT Legal PLLC will pass on the validity of the Common Stock being offered pursuant to this Registration Statement. JDT Legal PLLC has never owned any of our securities.
The consolidated financial statements of SSHT S&T Group Ltd. as of December 31, 2022 and 2021 have been audited by Shandong Haoxin Certified Public Accountants Co., Ltd, an independent registered public accounting firm, as stated in its report thereon which report expresses an unqualified opinion and includes an explanatory paragraph relating to the Company’s ability to continue as a going concern, incorporated herein by reference, and has been incorporated in this Prospectus and Registration Statement in reliance upon such report and upon the authority of such firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We filed this Registration Statement on Form S-1 with the SEC under the Act with respect to the Common Stock offered by Selling Shareholders in this Prospectus. This Prospectus, which constitutes a part of the Registration Statement, does not contain all of the information set forth in the Registration Statement or the exhibits and schedules filed therewith. For further information with respect to us and our Common Stock, please see the Registration Statement and the exhibits and schedules filed with the Registration Statement. Statements contained in this Prospectus regarding the contents of any contract or any other document that is filed as an exhibit to the Registration Statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the Registration Statement. The Registration Statement, including its exhibits and schedules, may be inspected without charge at the public reference room maintained by the SEC, located at 100 F Street, N.E., Room 1580, Washington, D.C. 20549, and copies of all or any part of the Registration Statement may be obtained from such offices upon the payment of the fees prescribed by the SEC. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. The SEC also maintains an Internet website that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. The address of the site is www.sec.gov.
Upon effectiveness of the registration statement of which this prospectus is a part, we will be subject to the information and periodic reporting requirements of the Exchange Act and, in accordance therewith, we will file periodic information and other information with the SEC. All documents filed with the SEC are available for inspection and copying at the public reference room and website of the SEC referred to above. We maintain a website at www.thedispensingsolution.com. You may access our reports and other information free of charge at this website as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. The information contained in, or that can be accessed through, our website is not incorporated by reference and is not a part of this prospectus.
28
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
F-1
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
the Shareholders and the Board of Directors of
SSHT S&T Group Ltd.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of SSHT S&T Group Ltd and its subsidiaries (the “Company”) as of December 31, 2022 and 2021, and the related consolidated statements of comprehensive loss, changes in shareholders’ equity (deficit) and cash flows for each of the two years in the period ended December 31, 2022, including the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022 and 2021, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ Shandong Haoxin Certified Public Accountants Co., Ltd.
We have served as the Company’s auditor since 2022.
Weifang, People’s Republic of China
April 28, 2023
F-2
CONSOLIDATED BALANCE SHEETS
| As of December 31, | ||||||||||
| Note | 2021 | 2022 | ||||||||
| US$ | US$ | |||||||||
| ASSETS | ||||||||||
| Current assets: | ||||||||||
| Cash and cash equivalents | 3 | 258 | 22,569 | |||||||
| Accounts receivable, net | 4 | - | 1,450 | |||||||
| Total current assets | 258 | 24,019 | ||||||||
| TOTAL ASSETS | 258 | 24,019 | ||||||||
| LIABILITIES AND SHAREHOLDERS’ DEFICIT | ||||||||||
| Current liabilities | ||||||||||
| Accounts payable | 6 | 15,692 | - | |||||||
| Amounts due to a related party | 7 | 115,939 | 81,823 | |||||||
| Total current liabilities | 131,631 | 81,823 | ||||||||
| TOTAL LIABILITIES | 131,631 | 81,823 | ||||||||
| Shareholders’ deficit: | ||||||||||
| Common stock, par value $0.001,100,000,000 shares authorized; 44,103,473 and 109,903,473shares issued and outstanding as of December 31, 2021 and December 31, 2022, respectively | 9 | 44,103 | 109,903 | |||||||
| Additional paid-in capital | 2,373,962 | 2,373,962 | ||||||||
| Accumulated deficit | (2,544,423 | ) | (2,543,986 | ) | ||||||
| Accumulated other comprehensive income (loss) | (5,015 | ) | 2,317 | |||||||
| Total shareholders’ deficit | (131,373 | ) | (57,804 | ) | ||||||
| TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT | 258 | 24,019 | ||||||||
F-3
CONSOLIDATED STATEMENTS OF OPERATIONS
| For the years ended December 31, | ||||||||||
| Note | 2021 | 2022 | ||||||||
| US$ | US$ | |||||||||
| Net revenues | 8 | - | 330,525 | |||||||
| Gross profit | - | 330,525 | ||||||||
| Operating expenses: | ||||||||||
| General and administrative expenses | 76,716 | 319,095 | ||||||||
| Total operating expenses | 76,716 | 319,095 | ||||||||
| (Loss) income from operations | (76,716 | ) | 11,430 | |||||||
| Interest income (expense), net | (7 | ) | (82 | ) | ||||||
| Bank charge | 122 | 204 | ||||||||
| Other expenses (net) | - | 9,379 | ||||||||
| (Loss) income before income taxes | (76,831 | ) | 1,929 | |||||||
| Income tax expenses | - | 1,492 | ||||||||
| Net (loss) income | (76,831 | ) | 437 | |||||||
| Net (loss) income attributable to ordinary shareholders | (76,831 | ) | 437 | |||||||
| Net loss per ordinary share: | ||||||||||
| Basic and diluted | 10 | (0.00 | ) | (0.00 | ) | |||||
| Weighted average shares used in calculating net loss per ordinary share: | ||||||||||
| Basic and diluted | 10 | 35,765,802 | 94,320,459 | |||||||
F-4
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
| For the years ended December 31, | ||||||||
| 2021 | 2022 | |||||||
| US$ | US$ | |||||||
| Net (Loss) income | (76,831 | ) | 437 | |||||
| Other comprehensive (loss) income | ||||||||
| Foreign currency translation adjustments, net of tax of nil | 2,137 | (7,332 | ) | |||||
| Comprehensive (loss) income attributable to SSHT S&T Group Ltd. | (74,694 | ) | (6,895 | ) | ||||
| Total comprehensive (loss) income attributable to ordinary shares of SSHT S&T Group Ltd. | (74,694 | ) | (6,895 | ) | ||||
F-5
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY (DEFICIT)
| Ordinary shares | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive (Income) Loss | Total shareholders’ equity (deficit) | ||||||||||||||||||||
| Shares | US$ | US$ | US$ | US$ | US$ | |||||||||||||||||||
| Balance at December 31, 2020 | 12,353,473 | 12,353 | 2,373,962 | (2,435,842 | ) | (2,878 | ) | (52,405 | ) | |||||||||||||||
| Net Loss | - | - | - | (76,831 | ) | - | (76,831 | ) | ||||||||||||||||
| Issuance of ordinary shares | 31,750,000 | 31,750 | - | (31,750 | ) | - | - | |||||||||||||||||
| Foreign currency translation adjustments | - | - | - | - | (2,137 | ) | (2,137 | ) | ||||||||||||||||
| Balance at December 31, 2021 | 44,103,473 | 44,103 | 2,373,962 | (2,544,423 | ) | (5,015 | ) | (131,373 | ) | |||||||||||||||
| Net Income | - | - | - | 437 | - | 437 | ||||||||||||||||||
| Issuance of ordinary shares | 65,800,000 | 65,800 | - | - | - | 65,800 | ||||||||||||||||||
| Foreign currency translation adjustments | - | - | - | - | 7,332 | 7,332 | ||||||||||||||||||
| Balance at December 31, 2022 | 109,903,473 | 109,903 | 2,373,962 | (2,543,986 | ) | 2,317 | (57,804 | ) | ||||||||||||||||
F-6
CONSOLIDATED STATEMENTS OF CASH FLOWS
| For the years ended December 31, | ||||||||
| 2021 | 2022 | |||||||
| US$ | US$ | |||||||
| Cash flows from operating activities: | ||||||||
| Net loss (income) | (76,831 | ) | 437 | |||||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | 2,113 | (1,450 | ) | |||||
| Accounts payable | (17,181 | ) | (15,692 | ) | ||||
| Amounts due to a related party | 93,717 | (34,116 | ) | |||||
| Net cash used in operating activities | 1,818 | (50,821 | ) | |||||
| Cash flows from financing activities: | ||||||||
| Proceeds from issuance of ordinary shares | - | 65,800 | ||||||
| Net cash (used in) provided by financing activities | - | 65,800 | ||||||
| Net increase in cash, cash equivalents | (319 | ) | 22,311 | |||||
| Cash, cash equivalents at beginning of year | 577 | 258 | ||||||
| Effect of exchange rate changes on cash, cash equivalents | (2,137 | ) | 7,332 | |||||
| Cash, cash equivalents at end of year | 258 | 22,569 | ||||||
| Supplemental disclosure of cash flow information: | ||||||||
| Income taxes paid | - | 1,492 | ||||||
F-7
| 1. | Organization and Principal Activities |
SSHT S&T Group Ltd. (the “Company”) was incorporated on March 7, 1984, under the laws of the State of Oregon as Gold Genie Worldwide, Inc. On June 13, 1988, the Company filed an amendment to its Articles of Incorporation and changed its name to Products, Services & Technology Corporation. On June 2, 1997, the Company redomiciled to Utah and changed its name to Wireless Data Solutions, Inc. on June 13, 1997. In August of 2007, the Company redomiciled to Nevada, where its registration remains active and in good standing. In December of 2021, the Company changed its name to SSHT S&T Group Ltd.
On December 5, 2022, the Company entered into an agreement with Wahoo Holdings Ltd., a British Virgin Islands corporation (“TIHL”), whereunder the Company acquired 100% ownership interest in TIHL for the issuance of 10,000,000 shares of the Company’s common stock. TIHL through its China based subsidiaries, Shanghai Jaz Capital Group Co., Ltd. provides business consulting services and using a team of accounting and finance professionals to offer its clients capital market research, back office support, financial accounting, listing support and support for mergers and acquisitions. The transaction ceased to be effective December 08, 2022 and has been treated as a business combination under common control.
| 2. | Summary of Significant Accounting Policies |
| (a) | Basis of Presentation |
The consolidated financial statements of the Group have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). The consolidated financial statements include the financial information of the Company and its wholly owned subsidiaries, All the intercompany balances and transactions have been eliminated upon consolidation. While the Company has commenced generating revenues from its principal business purpose during the most recently completed quarter ended December 31, 2022, we remain in the development stage in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic No. 915 (SFAS No. 7). The Company has elected a fiscal year end of December 31.
| (b) | Use of Estimates |
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results may differ from these estimates. The Group bases its estimates on historical experience and various other factors believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Significant accounting estimates reflected in the Group’s financial statements include but are not limited to allowance for doubtful accounts. Actual results may differ materially from those estimates.
| (c) | Foreign Currency Translation |
The functional currency of the Company is the United States Dollar (“US$”). The functional currency of its owned subsidiaries in the PRC is Renminbi (“RMB”).
Foreign currency transactions have been translated into the functional currency at the exchange rates prevailing on the date of transactions. Foreign currency denominated monetary assets and liabilities are re-measured into the functional currency at exchange rates prevailing on the balance sheet date. Exchange gains and losses are recorded in the statements of operations.
The Group has chosen the US$ as its reporting currency. Assets and liabilities have been translated using exchange rates prevailing on the balance sheet date. Equity accounts are translated at historical exchange rates. Income statement items have been translated using the average exchange rate for the year. Translation adjustments have been reported as cumulative translation adjustments and are shown as a component of other comprehensive (loss) income in the consolidated statements of comprehensive loss and consolidated statements of changes in shareholders’ equity (deficit).
F-8
| (d) | Cash, Cash Equivalents |
Cash and cash equivalents consist of cash on hand, demand deposits and floating rate financial instruments which are unrestricted as to withdrawal or use, and which have original maturities of three months or less when purchased.
| (e) | Acquisition |
The Company accounts for business combinations in accordance with Accounting Standards Codification (“ASC”) 805, Business Combinations. The results of businesses acquired in a business combination are included in the Company’s consolidated financial statements from the date of the acquisition. Purchase accounting results in assets and liabilities of an acquired business generally being recorded at their estimated fair values on the acquisition date. Any excess consideration over the fair value of assets acquired and liabilities assumed is recognized as goodwill. Transaction costs associated with business combinations are expensed as incurred and are included in general and administrative related costs in the consolidated statements of operations. The Company performs valuations of assets acquired and liabilities assumed and allocates the purchase price to its respective assets and liabilities. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates.
| (f) | Accounts Receivable, net |
Accounts receivable, net represents those receivables derived from the ordinary course of business and are recorded net of allowance for doubtful accounts. The Group maintains an allowance for doubtful accounts that reflect its best estimate of probable losses inherent in the accounts receivables. In determining collectability of the accounts receivables, the Group considers many factors, such as: creditworthiness of customers, aging of the receivables, payment history of customers, financial condition of the customers and market trends, and specific facts and circumstances.
The allowance for doubtful accounts is reduced by subsequent collections of the specific allowances or by any write-off of customer accounts that are deemed uncollectible.
| (g) | Goodwill and Other Long-Lived Assets |
Goodwill represents the excess of the cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination.
In accordance with guidance within FASB ASC 350 “Intangibles - Goodwill and Other,” goodwill and identifiable intangible assets with indefinite lives are not subject to amortization but must be evaluated for impairment.
We evaluate long-lived assets, including finite-lived intangible assets, for impairment by comparison of the carrying amounts to future net undiscounted cash flows expected to be generated by such assets when events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Should an impairment exist, the impairment loss would be measured based on the excess carrying value of the asset over the asset’s fair value or estimates of future discounted cash flows.
For goodwill and indefinite-lived intangible assets, in-process research and development, we review for impairment annually and upon the occurrence of certain events as required by ASC Topic 350, “Intangibles — Goodwill and Other.” Goodwill and indefinite-lived intangible assets are tested at least annually for impairment and more frequently if events or changes in circumstances indicate that the asset might be impaired. We review goodwill for impairment by first assessing qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill impairment test. If we are able to determine that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, we would conclude that goodwill is not impaired. If the carrying amount of a reporting unit is zero or negative, the second step of the impairment test is performed to measure the amount of impairment loss, if any, when it is more likely than not that a goodwill impairment exists.
F-9
| (h) | Revenue Recognition |
The Group recognizes revenue in accordance with ASC 606. The core principle of ASC606 is to recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received for those goods or services. ASC 606 defines a five-step process to achieve this core principle, which includes: (1) identifying contracts with customers, (2) identifying performance obligations within those contracts, (3) determining the transaction price, (4) allocating the transaction price to the performance obligation in the contract, which may include an estimate of variable consideration, and (5) recognizing revenue when or as each performance obligation is satisfied. Our sales arrangements generally ask customers to pay in advance before any services can be arranged. The company recognizes revenue when each performance obligation is satisfied. Documents and terms and the completion of any customer acceptance requirements, when applicable, are used to verify services rendered. The Company has no returns or sales discounts and allowances because services rendered and accepted by customers are normally not returnable.
| (i) | Income Taxes |
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and net operating loss and credit carryforwards. Deferred tax assets and liabilities are measured at rates expected to apply to taxable income in the years in which those temporary differences and carryforwards are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the statement of operations in the period that includes the enactment date. A valuation allowance is recorded when it is not more likely than not that all or a portion of the net deferred tax assets will be realized.
| (j) | Comprehensive Loss |
Comprehensive Loss includes all changes in equity except those resulting from investments by owners and distributions to owners. For the years presented, the Group’s total comprehensive loss includes net loss and foreign currency translation adjustments.
| (k) | Net Income (Loss) Per Share |
The Group computes net income (loss) per share in accordance with ASC 260, Earning per Share. ASC 260 requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. At December 31, 2022, there were no potentially dilutive shares.
| (l) | Fair Value of Financial Instruments |
FASB ASC 820, Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. FASB ASC 820 also establishes a fair value hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. FASB ASC 820 describes three levels of inputs that may be used to measure fair value:
Level 1 – Quoted prices in active markets for identical assets or liabilities.
Level 2 – Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 – Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation.
If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level of input that is significant to the fair value measurement of the instrument.
F-10
| (m) | Major Supplies and Customers |
The following customers accounted for 10% or more of revenue:
| For the years ended December 31, | ||||||||||||||||
| 2021 | 2022 | |||||||||||||||
| US$ | % | US$ | % | |||||||||||||
| Zhongshan Wanqi Investment Consulting Co., LTD | - | - | 168,920 | 51.11 | % | |||||||||||
| Laishan Network Technology (Xi’an) Co., LTD | - | - | 60,091 | 18.18 | % | |||||||||||
| Chengdu Ditou Enterprise Management Co., LTD | - | - | 35,433 | 10.72 | % | |||||||||||
| Datong Shipin Brand Management (Chengdu) Co., LTD | - | - | 33,387 | 10.10 | % | |||||||||||
The following vendors accounted for 10% or more of accounts payable:
| For the years ended December 31, | ||||||||||||||||
| 2021 | 2022 | |||||||||||||||
| US$ | % | US$ | % | |||||||||||||
| Shenzhen Guanghui Management Consulting Co., LTD | 15,692 | 100.00 | % | - | - | |||||||||||
| (n) | Foreign Currency Risk |
The RMB is not a freely convertible currency. The State Administration for Foreign Exchange in the PRC, under the authority of the Peoples Bank of China, controls the conversion of RMB into other currencies. The value of the RMB is subject to changes in central government policies, international economic and political developments affecting supply and demand in the China Foreign Exchange Trading System market. The Group’s cash and cash equivalents amounted to US$258 and US$22,569 as of December 31, 2021 and 2022, respectively.
| (o) | Recent Accounting Pronouncements |
The Company has reviewed other recently issued accounting pronouncements and plans to adopt those that are applicable to it. The Company does not expect the adoption of any other pronouncements to have an impact on its results of operations or financial position.
| 3. | Cash and Cash Equivalents |
The following is a summary of cash and cash equivalents:
| As of December 31, | ||||||||
| 2021 | 2022 | |||||||
| US$ | US$ | |||||||
| Cash and cash equivalents | 258 | 22,569 | ||||||
| Total | 258 | 22,569 | ||||||
F-11
|
4. | Accounts Receivable, net |
Accounts receivable, net, consisted of the following:
| As of December 31, | ||||||||
| 2021 | 2022 | |||||||
| US$ | US$ | |||||||
| Accounts receivable | - | 1,450 | ||||||
| Allowance for doubtful accounts | - | - | ||||||
| Balance at end of the year | - | - | ||||||
| Accounts receivable, net | - | 1,450 | ||||||
| 5. | Acquisitions |
On December 5, 2022, the Company entered into an agreement with Wahoo Holdings Ltd., a British Virgin Islands corporation (“TIHL”), whereunder the Company acquired 100% ownership interest in TIHL for the issuance of 10,000,000 shares of the Company’s common stock. TIHL through its China based subsidiaries, Shanghai Jaz Capital Group Co., Ltd. provides business consulting services and using a team of accounting and finance professionals offers its clients capital market research, back office support, financial accounting, listing support and support for mergers and acquisitions. The transaction closed effective December 08, 2022 and has been treated as a business combination under common control.
Tangible and intangible assets acquired were recorded based on their estimated fair values at the acquisition date. The excess of the purchase price over the fair value of the net assets acquired was recorded to goodwill. The Company fully impaired the goodwill during the year ended December 31, 2022.
| Amount | ||||
| (US$) | ||||
| Cash and cash equivalent | 27,144 | |||
| Accounts receivable, net | 1,450 | |||
| Accounts payable | 10,149 | |||
| Amounts due to a related party | 11,136 | |||
| Total net assets | 7,309 | |||
| Attributed to the Company | 7,309 | |||
| Consideration: | ||||
| Accumulated 10,000,000 common stock | 10,000 | |||
| Goodwill | 2,691 | |||
| 6. | Accounts Payable |
The following is a summary of accounts payable:
| As of December 31, | ||||||||
| 2021 | 2022 | |||||||
| US$ | US$ | |||||||
| Accounts payable | 15,692 | - | ||||||
| Total | 15,692 | - | ||||||
F-12
| 7. | Related Parties |
Balances with Related Parties
| As of December 31, | ||||||||
| 2021 | 2022 | |||||||
| US$ | US$ | |||||||
| Amounts due to a related party | 115,939 | 81,823 | ||||||
| Total | 115,939 | 81,823 | ||||||
During the year ended December 31, 2022, Mr. Zhonghan Wu advanced a total of $81,823 to the Company for payment of administrative expenses and legal fees, which amount remains due and payable.
| 8. | Revenue |
| As of December 31, | ||||||||
| 2021 | 2022 | |||||||
| US$ | US$ | |||||||
| Consulting fee | - | 161,604 | ||||||
| Listing advisory fee | - | 168,921 | ||||||
| Total | - | 330,525 | ||||||
| 9. | Ordinary Shares |
As of December 31, 2022, the Company is authorized to issue 1,000,000,000 shares of common stock with a par value of $0.001. All shares have equal voting rights, are non-assessable, and have one vote per share. The total number of shares of Company common stock issued and outstanding as of December 31, 2022 and December 31, 2021, was 109,903,473 and 44,103,473 shares, respectively.
| 10. | Net Loss per Ordinary Share |
Net loss per ordinary share was computed by dividing net loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding for the years ended December 31, 2021 and 2022:
| For the years ended December 31, | ||||||||
| 2021 | 2022 | |||||||
| US$ | US$ | |||||||
| Numerator: | ||||||||
| Net loss—basic and diluted | (76,831 | ) | 437 | |||||
| Deemed dividend in relation to the convertible note | - | - | ||||||
| Net loss attributable to ordinary shareholders | (76,831 | ) | 437 | |||||
| Shares (Denominator): | ||||||||
| Weighted average number of ordinary shares outstanding | 35,765,802 | 94,320,459 | ||||||
| Basic and diluted | - | - | ||||||
| Net loss per share—basic and diluted | (0.00 | ) | (0.00 | ) | ||||
F-13
| 11. | Commitments and contingencies |
The Group did not have other significant capital commitments or significant guarantees as of December 31, 2021 and 2022, respectively.
| 12. | Subsequent Event |
Management has evaluated subsequent events through April 30, 2023, the date on which the financial statements were available to be issued. All subsequent events requiring recognition as of December 31, 2022 have been incorporated into these financial statements and there are no subsequent events that require disclosure in accordance with FASB ASC Topic 855, “Subsequent Events.”
F-14
OUTSIDE BACK COVER OF PROSPECTUS
We have not authorized any dealer, salesperson or any other person to give any information or to represent anything other than those contained in this prospectus in connection with the offer contained herein, and, if given or made, you should not rely upon such information or representations as having been authorized by SSHT S&T Group Ltd. This prospectus does not constitute an offer of any securities other than those to which it relates or an offer to sell, or a solicitation of an offer to buy, to those to which it relates in any state to any person to whom it is not lawful to make such offer in such state. The delivery of this prospectus at any time does not imply that the information herein is correct as of any time after the date of this prospectus.
DEALER PROSPECTUS DELIVERY REQUIREMENT
Until _______________, 20___ [90 days from the date of this prospectus], all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
SSHT S&T Group Ltd.
_______ Shares
Common Stock
PROSPECTUS
_______ ___, 2023
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the costs and expenses payable by us in connection with the issuance and distribution of the securities being registered. None of the following expenses are payable by the Selling Stockholders. All of the amounts shown are estimates, except for the SEC registration fee.
| SEC registration fee | $ | 110.20 | ||
| Legal fees and expenses | 20,000.00 | |||
| Accounting fees and expenses | 25,000.00 | |||
| Miscellaneous | 2,500.00 | |||
| TOTAL | $ | 47,610.20 |
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company’s directors and executive officers are indemnified as provided by the Nevada Revised Statutes and its Bylaws. These provisions state that the Company’s directors may cause the Company to indemnify a director or former director against all costs, charges and expenses, including an amount paid to settle an action or satisfy a judgment, actually and reasonably incurred by him as a result of him acting as a director. The indemnification of costs can include an amount paid to settle an action or satisfy a judgment. Such indemnification is at the discretion of the Company’s board of directors and is subject to the Securities and Exchange Commission’s policy regarding indemnification.
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, or otherwise, The Company has been advised that in the opinion of the Securities and Exchange Commission, such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
Since March 31, 2020, we have issued the following unregistered securities:
Common Stock Issuances
On March 17, 2021, we issued a total of 11,000,000 shares of Common stock as compensation for consulting services to Haining Zhang and Quanleap LLC, and entity controlled by Haining Zhang.
On April 6, 2021, we issued a total of 21,000,000 shares of Common stock as compensation for consulting services to Haining Zhang and Quanleap LLC, and entity controlled by Haining Zhang.
On July 23, 2021, we issued 2,500,000 shares of Common stock as compensation for consulting services to Haining Zhang.
On February 11, 2022, we issued 55,800,000 shares of Common stock as compensation for consulting services to SSHT Int’l Holding Limited, an entity controlled by Zonghan Wu.
On December 8, 2022, we issued a total of 10,000,000 shares of Common stock to Xiaobei Huang, Dan Sun, Desheng Zhou, and Cheng Xu in conjunction with our acquisition of Wahoo Holdings, Ltd.
None of the foregoing transactions involved any underwriters, underwriting discounts or commissions, or any public offering. We believe the offers, sales and issuances of the above securities were exempt from registration under the Securities Act (or Regulation D or Regulation S promulgated thereunder) by virtue of Section 4(a)(2) of the Securities Act because the issuance of securities to the recipients did not involve a public offering, or in reliance on Rule 701 because the transactions were pursuant to compensatory benefit plans or contracts relating to compensation as provided under such rule. The recipients of the securities in each of these transactions represented their intentions to acquire the securities for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends were placed upon the stock certificates issued in these transactions. All recipients had adequate access, through their relationships with us, to information about us. The sales of these securities were made without any general solicitation or advertising.
II-1
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) Exhibits
See the Exhibit Index immediately preceding the signature page hereto for a list of exhibits filed as part of this registration statement on Form S-1, which Exhibit Index is incorporated herein by reference.
(b) Financial Statement Schedules
All financial statement schedules are omitted because the information called for is not required or is shown either in the consolidated financial statements or in the notes thereto.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers, or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
(5) That, for the purpose of determining any liability under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
II-2
(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§ 230.424 of this chapter);
(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant. The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
(iii) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
(6) (i) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
(i) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(7) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
II-3
Index to Exhibits
| Filed | Incorporated by Reference | |||||||
| Exhibit No. | Description | Herewith (*) | Filing Type | Date Filed | ||||
| 3.1 | Articles of Incorporation | 10-SB | 3/7/1984 | |||||
| 3.2 | Articles of Incorporation, as amended | 10-SB | 6/13/1988 | |||||
| 3.3 | Bylaws | 10-SB | 6/2/1997 | |||||
| 5.1 | Opinion of JDT Legal, PLLC | * | ||||||
| 10.1 | Definitive Share Exchange Agreement dated December 5, 2022, with Wahoo Holdings, Ltd. | * | ||||||
| 21.1 | List of Subsidiaries | * | ||||||
| 23.1 | Consent of Shandong Haoxin Certified Public Accountants Co., Ltd. | * | ||||||
| 23.2 | Consent of JDT Legal, PLLC (included in Exhibit 5.1) | * | ||||||
| 101 | Interactive Data File | * | ||||||
| 107 | Calculation of Registration Fee | * | ||||||
II-4
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized.
| SSHT S&T GROUP LTD. | |||||
| Date: | May 11, 2023 | By: | /s/ Zonghan Wu | ||
| Name: | Zonghan Wu | ||||
| Title: | Chief Executive Officer | ||||
Pursuant to the requirements of the Securities Act of 1933, this registration statement on Form S-1 has been signed by the following persons in the capacities and on the dates indicated.
| Signature | Title | Date | ||
| /s/ Zonghan Wu | Chief Executive Officer, Director | May 11, 2023 | ||
| Zonghan Wu | (Principal Executive Officer) | |||
| /s/ Zonghan Wu | Principal Financial Officer and | May 11, 2023 | ||
| Zonghan Wu | Principal Accounting Officer |
II-5
Exhibit 5.1
SSHT S&T Group Ltd.
46 Reeves Road
Pakuranga 2010
New Zealand
| Re: | Registration Statement on Form S-1 for SSHT S&T Group, Ltd. |
Ladies and Gentlemen:
We have acted as counsel to SSHT S&T Group Ltd., a Nevada corporation (the “Company”), in connection with the filing by the Company of a Registration Statement on Form S-1 (the “Registration Statement”) with the Securities and Exchange Commission, including a related prospectus filed with the Registration Statement (the “Prospectus”), covering a resale registration of up to 100,000,000 shares of the Company’s common stock, par value $0.001, (the “Shares”).
In connection with this opinion, we have (i) examined and relied upon (a) the Registration Statement and the Prospectus, (b) the Company’s Articles of Incorporation, as amended, and Bylaws, each as currently in effect, (c) the forms of the Company’s Articles of Incorporation and Bylaws filed as Exhibits 3.1 and 3.3, to the Registration Statement, respectively, each of which is to be in effect upon the effectiveness of the offering contemplated by the Registration Statement and (d) originals or copies certified to our satisfaction of such records, documents, certificates, memoranda and other instruments as in our judgment are necessary or appropriate to enable us to render the opinion expressed below and (ii) assumed that the Shares will be sold at the prevailing market price or in a privately negotiated transaction by the selling stockholders.
In connection with the foregoing, we have examined originals or copies of such corporate records of the Company, certificates and other communications of public officials, certificates of officers of the Company and such other documents as we have deemed relevant or necessary for the purpose of rendering the opinions expressed herein. As to questions of fact material to those opinions, we have, to the extent we deemed appropriate, relied on certificates of officers of the Company and on certificates and other communications of public officials. We have assumed the genuineness of all signatures on, and the authenticity of, all documents submitted to us as originals, the conformity to authentic original documents of all documents submitted to us as copies thereof, the due authorization, execution and delivery by the parties thereto other than the Company of all documents examined by us, and the legal capacity of each individual who signed any of those documents. In addition, we have assumed that at the time of the issuance and sale of the Shares: (i) the Company is validly existing and in good standing under the law of the State of Nevada, (ii) the Company has not amended its certificate of incorporation or bylaws, and (iii) the board of directors of the Company and any committee thereof has not taken any action to amend, rescind or otherwise reduce its prior authorization of the issuance of the Shares, (b) the Registration Statement becomes and remains effective, and the prospectus which is a part of the Registration Statement, and the prospectus delivery requirements with respect thereto, fulfill all of the requirements of the Securities Act, throughout all periods relevant to the opinion, (c) the Shares will be offered in the manner and on the terms identified or referred to in the Registration Statement, including all amendments thereto, and (d) all offers and sales of the Shares will be made in compliance with the securities laws of the states having jurisdiction thereof.
Our opinion is expressed only with respect to the General Corporation Law of the State of Nevada. We express no opinion to the extent that any other laws are applicable to the subject matter hereof and express no opinion and provide no assurance as to compliance with any federal or state securities law, rule or regulation.
On the basis of the foregoing, and in reliance thereon, we are of the opinion that the Shares, when sold and issued against payment therefor as described in the Registration Statement and the Prospectus, will be validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and the reference to this firm under the caption “Legal Matters” in the prospectus contained in the Registration Statement. In giving such consent, we do not hereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act and the rules and regulations thereunder. This opinion is rendered to you as of the date hereof and we assume no obligation to advise you or any other person hereafter with regard to any change after the date hereof in the circumstances or the law that may bear on the matters set forth herein even though the change may affect the legal analysis or legal conclusion or other matters in this letter.
| Sincerely, | |
| /s/ JDT Legal, PLLC |
Exhibit 10.1
DEFINITIVE SHARE EXCHANGE AGREEMENT
This Definitive Share Exchange Agreement (“Agreement”), dated as of December 5, 2022, is among Wahoo Holdings Limited. (“WHL”), a BVI company, Xiaobei Huang, Dan Sun, Desheng Zhou, and Cheng Xu, the Shareholders of WHL (the “Shareholders”), SSHT S&T Group Ltd, a Nevada corporation (“SSHT”), Zonghan Wu (“ZHW”), the Chairman of SSHT. Collectively, the Shareholders, WHL, SSHT, and ZHW are the “Parties.”
The parties hereby enter into this Agreement, following which,
| 1. | SSHT will own 50,000 ordinary shares of WHL, representing all of the issued and outstanding equity of WHL; |
| 2. | the Shareholders will be issued 10,000,000 shares of SSHT, $0.001 par value per share (the “Common Stock”), representing 9.1% of SSHT’s outstanding shares of Common Stock (the “Share Exchange”), calculated post-issuance and in addition to the voting control shares currently held by the Shareholders; and |
| 3. | WHL will hold no common shares of SSHT, as the wholly-owned subsidiary of SSHT. |
As a result of this Agreement, SSHT will be announcing this reverse merger. The first consolidated post-acquisition report will be the initial report following the Closing (as defined below).
RECITALS
WHEREAS, the Shareholders currently holds 50,000 ordinary shares of WHL, representing all of the equity of WHL and is desirous of relinquishing all of their WHL shares so that they are issued 10,000,000 shares of SSHT Common Stock of the 109,903,473 shares of SSHT Common Stock to be outstanding; this would represent 9.1% of SSHT’s issued and outstanding shares of Common Stock; and that WHL would be a wholly-owned subsidiary of SSHT.
WHEREAS, the Shareholders and the Board of Directors of the WHL are desirous of WHL becoming a wholly-owned subsidiary of SSHT.
WHEREAS, SSHT and WHL are desirous of SSHT acquiring 100% of the outstanding shares of WHL, and issuing 10,000,000 shares of SSHT Common Stock in the process, making WHL a wholly-owned subsidiary of SSHT, with the shares of SSHT Common Stock being issued pro-rata to the Shareholders.
WHEREAS, SSHT and WHL are desirous of SSHT acquiring 100% of the outstanding shares of WHL.
WHEREAS, the Board of Directors and Shareholders of SSHT and WHL, respectively, have each agreed to Exchange and issue shares, as necessary to cause the forgoing results, upon the terms, and subject to the conditions, set forth in this Agreement.
WHEREAS, it is intended that, for federal income tax purposes, the Share Exchange shall qualify as a reorganization under the provisions of Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended (the “Code”), and the rules and regulations promulgated thereunder, and be tax-free pursuant to Section 351(a) of the Code.
WHEREAS, the Parties desire to make certain representations, warranties, covenants and agreements in connection with this Agreement.
NOW, THEREFORE, in consideration of the premises and mutual promises herein made, and in consideration of the representations, warranties, covenants and agreements herein contained, and intending to be legally bound hereby, the Parties agree as follows:
INCORPORATION OF RECITALS BY REFERENCE. The Recitals are hereby incorporated herein by this reference, as if fully restated herein.
ARTICLE I
DEFINITIONS
I.1 Certain Definitions. The following terms shall, when used in this Agreement, have the following meanings:
“Acquisition” means the acquisition of any businesses, assets or property other than in the ordinary course, whether by way of the purchase of assets or stock, by SSHT acquiring all of the outstanding shares of WHL pursuant to this Share Exchange Agreement from the Shareholders and the Shareholders relinquishing and exchanging her shares of WHL to SSHT.
“Affiliate” means, with respect to any Person: (i) any Person directly or indirectly owning, controlling or holding with power to vote ten percent (10%) or more of the outstanding voting securities of such other Person (other than passive or institutional investors); (ii) any Person ten percent (10%) or more of whose outstanding voting securities are directly or indirectly owned, controlled or held with power to vote, by such other Person; (iii) any Person directly or indirectly controlling, controlled by or under common control with such other Person; and (iv) any officer, director or partner of such other Person. “Control” for the foregoing purposes shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities or voting interests, by contract or otherwise.
“Business Day” means any day other than Saturday, Sunday or a day on which banking institutions in New York, New York, are required or authorized to be closed.
“Code” means the United States Internal Revenue Code of 1986, as amended.
2
“Collateral Documents” mean the Exhibits and any other documents, instruments and certificates to be executed and delivered by the Parties hereunder or there under.
“Commission” means the Securities and Exchange Commission or any Regulatory Authority that succeeds to its functions.
“Effective Time” means, the moment in time when the shares of the SSHT are exchanged for the shares of WHL.
“Encumbrance” means any material mortgage, pledge, lien, encumbrance, charge, security interest, security agreement, conditional sale or other title retention agreement, limitation, option, assessment, restrictive agreement, restriction, adverse interest, restriction on transfer or exception to or material defect in title or other ownership interest (including restrictive covenants, leases and licenses).
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations there under.
“Exchange Shares” means the issued and outstanding ordinary shares of WHL (the “WHL Shares”), exchanged by the Shareholders to SSHT, for 10,000,000 shares of Common Stock of SSHT (the “SSHT Shares”).
“GAAP” means United States generally accepted accounting principles as in effect from time to time.
“Legal Requirement” means any statute, ordinance, law, rule, regulation, code, injunction, judgment, order, decree, ruling, or other requirement enacted, adopted or applied by any Regulatory Authority, including judicial decisions applying common law or interpreting any other Legal Requirement.
“Losses” shall mean all damages, awards, judgments, assessments, fines, sanctions, penalties, charges, costs, expenses, payments, diminutions in value and other losses, however suffered or characterized, all interest thereon, all costs and expenses of investigating any claim, lawsuit or arbitration and any appeal there from, all actual attorneys’, accountants’ investment bankers’ and expert witness’ fees incurred in connection therewith, whether or not such claim, lawsuit or arbitration is ultimately defeated and, subject to Section 9.4, all amounts paid incident to any compromise or settlement of any such claim, lawsuit or arbitration.
“Liability” means any liability or obligation (whether known or unknown, whether asserted or unasserted, whether absolute or contingent, whether accrued or unaccrued, whether liquidated or unliquidated, and whether due or to become due), including any liability for Taxes.
“Material Adverse Effect” means a material adverse effect on (i) the assets, Liabilities, properties or business of the Parties, (ii) the validity, binding effect or enforceability of this Agreement or the Collateral Documents or (iii) the ability of any Party to perform its obligations under this Agreement and the Collateral Documents; provided, however, that none of the following shall constitute a Material Adverse Effect on SSHT: (i) the filing, initiation and subsequent prosecution, by or on behalf of Shareholders of any Party, of litigation that challenges or otherwise seeks damages with respect to the Share Exchange, this Agreement and/or transactions contemplated thereby or hereby, (ii) occurrences due to a disruption of a Party’s business as a result of the announcement of the execution of this Agreement or Changes caused by the taking of action required by this Agreement, (iii) general economic conditions, or (iv) any Changes generally affecting the industries in which a Party operates.
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“Permit” means any license, permit, consent, approval, registration, authorization, qualification or similar right granted by a Regulatory Authority.
“Permitted Liens” means (i) liens for Taxes not yet due and payable or being contested in good faith by appropriate proceedings; (ii) rights reserved to any Regulatory Authority to regulate the affected property; (iii) statutory liens of banks and rights of set off; (iv) as to leased assets, interests of the lessors and sub-lessors thereof and liens affecting the interests of the lessors and sub-lessors thereof; (v) inchoate material men’s, mechanics’, workmen’s, repairmen’s or other like liens arising in the ordinary course of business; (vi) liens incurred or deposits made in the ordinary course in connection with workers’ compensation and other types of social security; (vii) licenses of trademarks or other intellectual property rights granted by SSHT, in the ordinary course and not interfering in any material respect with the ordinary course of the business of SSHT; and (viii) as to real property, any encumbrance, adverse interest, constructive or other trust, claim, attachment, exception to or defect in title or other ownership interest (including, but not limited to, reservations, rights of entry, rights of first refusal, possibilities of reversion, encroachments, easement, rights of way, restrictive covenants, leases, and licenses) of any kind, which otherwise constitutes an interest in or claim against property, whether arising pursuant to any Legal Requirement, under any contract or otherwise, that do not, individually or in the aggregate, materially and adversely affect or impair the value or use thereof as it is currently being used in the ordinary course.
“Person” means any natural person, corporation, partnership, trust, unincorporated organization, association, Limited Liability Company, Regulatory Authority or other entity.
“Regulatory Authority” means: (i) the United States of America; (ii) any state, commonwealth, territory or possession of the United States of America and any political subdivision thereof (including counties, municipalities and the like); (iii) Canada and any other foreign (as to the United States of America) sovereign entity and any political subdivision thereof; or (iv) any agency, authority or instrumentality of any of the foregoing, including any court, tribunal, department, bureau, commission or board.
“Representative” means any director, officer, employee, agent, consultant, advisor or other representative of a Person, including legal counsel, accountants and financial advisors.
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations there under.
“SSHT Business” means the business conducted by SSHT.
“SSHT Common Stock” means the common shares of SSHT.
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“Subsidiary” of a specified Person means (a) any Person if securities having ordinary voting power (at the time in question and without regard to the happening of any contingency) to elect a majority of the directors, trustees, managers or other governing body of such Person are held or controlled by the specified Person or a Subsidiary of the specified Person; (b) any Person in which the specified Person and its subsidiaries collectively hold a fifty percent (50%) or greater equity interest; (c) any partnership or similar organization in which the specified Person or subsidiary of the specified Person is a general partner; or (d) any Person the management of which is directly or indirectly controlled by the specified Person and its Subsidiaries through the exercise of voting power, by contract or otherwise.
“Tax” means any U.S. or non U.S. federal, state, provincial, local or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, capital, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, intangible property, recording, occupancy, sales, use, transfer, registration, value added minimum, estimated or other tax of any kind whatsoever, including any interest, additions to tax, penalties, fees, deficiencies, assessments, additions or other charges of any nature with respect thereto, whether disputed or not.
“Tax Return” means any return, declaration, report, claim for refund or credit or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.
“Treasury Regulations” means regulations promulgated by the U.S. Treasury Department under the Code.
ARTICLE II
THE SHARE EXCHANGE
II.1 Share Exchange. In accordance with and subject to the provisions of this Agreement and the Nevada Revised Statutes (the “Code”), at the Effective Time, WHL shall become a wholly-owned subsidiary of SSHT, and SSHT shall be its only Shareholders and shall continue in its existence with one owner, SSHT, until a merger, if any. Pursuant to the Share Exchange, the Shareholders is relinquishing all of her 50,000 WHL ordinary shares, constituting all issued and outstanding shares of WHL (the “WHL Shares”), and is acquiring 10,000,000 SSHT Shares, representing 9.1% of the outstanding Common Stock of SSHT.
II.2 Stock Transfer Books. Effective immediately after the Share Exchange, the stock transfer books of WHL shall be closed for this transaction.
II.3 Restriction on Transfer. The Exchange Shares may not be sold, transferred, or otherwise disposed of without registration under the Act or an exemption therefrom, and that in the absence of an effective registration statement covering the Share Exchange Shares or any available exemption from registration under the Act, the Share Exchange Shares must be held indefinitely. The Parties are aware that the Share Exchange Shares may not be sold pursuant to Rule 144 promulgated under the Act unless all of the conditions of that Rule are met. Among the conditions for use of Rule 144 may be the availability of current information to the public about SSHT.
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II.4 Restrictive Legend. All certificates representing the Exchange Shares shall contain an appropriate restrictive legend.
II.5 Closing. The closing of the transactions contemplated by this Agreement and the Collateral Documents (the “Closing”) shall take place via conference call at the offices of McMurdo law Group, LLC, 1185 Avenue of the Americas, 3rd Floor, NY 10036, or at such other location as the parties may agree.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SSHT
SSHT represents and warrants to the Shareholders that the statements contained in this ARTICLE III are correct and complete as of the date of this Agreement and, except as provided in Section 7.1, will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this ARTICLE III, except in the case of representations and warranties stated to be made as of the date of this Agreement or as of another date and except for Changes contemplated or permitted by this Agreement).
III.1 Organization and Qualification. SSHT is a corporation duly organized, validly existing and in good standing under the laws of its respective jurisdiction of organization. SSHT has all requisite power and authority to own, lease and use its assets as they are currently owned, leased and used and to conduct its business as it is currently conducted. SSHT is duly qualified or licensed to do business in and is in good standing in each jurisdiction in which the character of the properties owned, leased or used by it or the nature of the activities conducted by it make such qualification necessary, except any such jurisdiction where the failure to be so qualified or licensed would not have a Material Adverse Effect on SSHT or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of SSHT to perform its obligations under this Agreement or any of the Collateral Documents.
III.2 Capitalization.
(a) The authorized capital stock and other ownership interests of SSHT, a Nevada corporation, consists of 1,000,000,000 common shares of Common Stock, of which 99,903,473 were issued and outstanding as of December 4, 2022. All of the outstanding SSHT Common Stock have been duly authorized and are validly issued, fully paid and non-assessable.
(b) Other than what has been described herein or in SSHT’s filings via OTC Markets, there are no outstanding or authorized options, warrants, purchase rights, preemptive rights or other contracts or commitments that could require SSHT to issue, sell, or otherwise cause to become outstanding any of its capital stock or other ownership interests (collectively “Options”).
(c) All of the issued and outstanding shares of SSHT Common Stock have been duly authorized and are validly issued and outstanding, fully paid and non-assessable and have been issued in compliance with applicable securities laws and other applicable Legal Requirements or transfer restrictions under applicable securities laws.
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III.3 Authority and Validity. SSHT has all requisite corporate power to execute and deliver, to perform its obligations under, and to consummate the transactions contemplated by, this Agreement (subject to the receipt of any necessary consents, approvals, authorizations or other matters referred to herein). The execution and delivery by SSHT of, the performance by SSHT of its obligations under, and the consummation by SSHT of the transactions contemplated by, this Agreement have been duly authorized by all requisite action of SSHT (subject to the approval of SSHT Shareholders as contemplated herein). This Agreement has been duly executed and delivered by SSHT and (assuming due execution and delivery by the Shareholders and approval by SSHT Shareholders) is the legal, valid and binding obligation of SSHT, enforceable against it in accordance with its terms, except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles. Upon the execution and delivery of the Collateral Documents by each Person (other than by the Shareholders) that is required by this Agreement to execute, or that does execute, this Agreement or any of the Collateral Documents, and assuming due execution and delivery thereof by the Shareholders, the Collateral Documents will be the legal, valid and binding obligations of SSHT, enforceable against SSHT in accordance with their respective terms, except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles.
III.4 No Breach or Violation. Subject to obtaining the consents, approvals, authorizations, and orders of and making the registrations or filings with or giving notices to Regulatory Authorities and Persons identified herein, the execution, delivery and performance by SSHT of this Agreement and the Collateral Documents to which it is a party, and the consummation of the transactions contemplated hereby and thereby in accordance with the terms and conditions hereof and thereof, do not and will not conflict with, constitute a violation or breach of, constitute a default or give rise to any right of termination or acceleration of any right or obligation of SSHT under, or result in the creation or imposition of any Encumbrance upon SSHT, SSHT assets, SSHT Business or SSHT Common Stock by reason of the terms of (i) the articles of incorporation, by laws or other charter or organizational document of SSHT or any Subsidiary of SSHT, (ii) any material contract, agreement, lease, indenture or other instrument to which SSHT is a party or by or to which SSHT, or the assets may be bound or subject and a violation of which would result in a Material Adverse Effect on SSHT, (iii) any order, judgment, injunction, award or decree of any arbitrator or Regulatory Authority or any statute, law, rule or regulation applicable to SSHT or (iv) any Permit of SSHT, which in the case of (ii), (iii) or (iv) above would have a Material Adverse Effect on SSHT or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of SSHT to perform its obligations under this Agreement or any of the Collateral Documents.
III.5 Consents and Approvals. Except for requirements described in Schedule 3.5, no consent, approval, authorization or order of, registration or filing with, or notice to, any Regulatory Authority or any other Person is necessary to be obtained, made or given by SSHT in connection with the execution, delivery and performance by SSHT of this Agreement or any Collateral Document or for the consummation by SSHT of the transactions contemplated hereby or thereby, except to the extent the failure to obtain any such consent, approval, authorization or order or to make any such registration or filing would not have a Material Adverse Effect on SSHT or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of SSHT to perform its obligations under this Agreement or any of the Collateral Documents.
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III.6 Intellectual Property. SSHT warrants that it has good title to or the right to use all material company intellectual property rights and all material inventions, processes, designs, formulae, trade secrets and know how necessary for the operation of SSHT Business without the payment of any royalty or similar payment.
III.7 Compliance with Legal Requirements. SSHT has operated its business in compliance with all Legal Requirements applicable to SSHT except to the extent the failure to operate in compliance with all material Legal Requirements would not have a Material Adverse Effect on SSHT or Material Adverse Effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents.
III.8 Litigation. There are no outstanding judgments or orders against or otherwise affecting or related to SSHT, SSHT Business or SSHT assets and there is no action, suit, complaint, proceeding or investigation, judicial, administrative or otherwise, that is pending or, to SSHT’s knowledge, threatened that, if adversely determined, would have a Material Adverse Effect on SSHT or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents, except as noted in the Company’s financial statements published on OTC Markets or documented by SSHT to the Shareholders.
III.9 Taxes. To the best of SSHT’s knowledge, SSHT has duly and timely filed in proper form all Tax Returns for all Taxes required to be filed with the appropriate Regulatory Authority, and has paid all taxes required to be paid in respect thereof except where such failure would not have a Material Adverse Effect on SSHT, except where, if not filed or paid, the exception(s) have been documented by SSHT to the Shareholders.
III.10 Books and Records. The books and records of SSHT accurately and fairly represent SSHT Business and its results of operations in all material respects.
III.11 Brokers or Finders. All negotiations relative to this Agreement and the transactions contemplated hereby have been carried out by SSHT and/or its Affiliates/Representatives in connection with the transactions contemplated by this Agreement, neither SSHT, nor any of its Affiliates/Representatives have incurred any obligation to pay any brokerage or finder’s fee or other commission in connection with the transaction contemplated by this Agreement.
III.12 Disclosure. No representation or warranty of SSHT in this Agreement or in the Collateral Documents and no statement in any certificate furnished or to be furnished by SSHT pursuant to this Agreement contained, contains or will contain on the date such agreement or certificate was or is delivered, or on the Closing Date, any untrue statement of a material fact, or omitted, omits or will omit on such date to state any material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.
III.13 No Undisclosed Liabilities. SSHT is not subject to any material liability (including unasserted claims), absolute or contingent, which is not shown or which is in excess of amounts shown or reserved for in the balance sheet as of September 30, 2022, other than liabilities of the same nature as those set forth in SSHT’s financial statements and reasonably incurred in the ordinary course of its business after September 30, 2022.
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III.14 Disclosed Liabilities. All liabilities disclosed by SSHT shall be paid from SSHT’s accounts receivable when and as is due. Any Liabilities, disclosed or undisclosed, shall be the sole obligation of SSHT.
III.15 Absence of Certain Changes. Since September 30, 2022, SSHT has not: (a) suffered any material adverse change in its financial condition, assets, liabilities or business; (b) contracted for or paid any capital expenditures; (c) incurred any indebtedness or borrowed money, issued or sold any debt or equity securities, declared any dividends or discharged or incurred any liabilities or obligations except in the ordinary course of business as heretofore conducted; (d) mortgaged, pledged or subjected to any lien, lease, security interest or other charge or encumbrance any of its properties or assets; (e) paid any material amount on any indebtedness prior to the due date, forgiven or cancelled any material amount on any indebtedness prior to the due date, forgiven or cancelled any material debts or claims or released or waived any material rights or claims; (f) suffered any damage or destruction to or loss of any assets (whether or not covered by insurance); (g) acquired or disposed of any assets or incurred any liabilities or obligations; (h) made any payments to its affiliates or associates or loaned any money to any person or entity; (i) formed or acquired or disposed of any interest in any corporation, partnership, limited liability company, joint venture or other entity; (j) entered into any employment, compensation, consulting or collective bargaining agreement or any other agreement of any kind or nature with any person. Or group, or modified or amended in any respect the terms of any such existing agreement; (k) entered into any other commitment or transaction or experience any other event that relates to or affect in any way this Agreement or to the transactions contemplated hereby, or that has affected, or may adversely affect SSHT Business, operations, assets, liabilities or financial condition; or (1) amended its Articles of Incorporation or By-laws, except as otherwise contemplated herein.
III.16 Contracts. A true and complete list of all contracts, agreements, leases, commitments or other understandings or arrangements, written or oral, express or implied, to which SSHT is a party or by which it or any of its property is bound or affected requiring payments to or from, or incurring of liabilities by, SSHT in excess of $10,000 (the “Contracts”). SSHT has complied with and performed, in all material respects, all of its obligations required to be performed under and is not in default with respect to any of the Contracts, as of the date hereof, nor has any event occurred which has not been cured which, with or without the giving of notice, lapse of time, or both, would constitute a default in any respect there under. To the best knowledge of SSHT, no other party has failed to comply with or perform, in all material respects, any of its obligations required to be performed under or is in material default with respect to any such Contracts, as of the date hereof, nor has any event occurred which, with or without the giving of notice, lapse of time or both, would constitute a material default in any respect by such party there under. SSHT knows of and has no reason to believe that there are any facts or circumstances which would make a material default by any party to any contract or obligation likely to occur subsequent to the date hereof.
III.17 Permits and Licenses. SSHT has all certificates of occupancy, rights, permits, certificates, licenses, franchises, approvals and other authorizations as are reasonably necessary to conduct its business and to own, lease, use, operate and occupy its assets, at the places and in the manner now conducted and operated, except those the absence of which would not materially adversely affect its business. SSHT has not received any written or oral notice or claim pertaining to the failure to obtain any material permit, certificate, license, approval or other authorization required by any federal, state or local agency or other regulatory body, the failure of which to obtain would materially and adversely affect its business.
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III.18 Assets Necessary to Business. SSHT owns or leases all properties and assets, real, personal, and mixed, tangible and intangible, and is a party to all licenses, permits and other agreements necessary to permit it to carry on its business as presently conducted.
III.19 Labor Agreements and Labor Relations. SSHT has no collective bargaining or union contracts or agreements. SSHT is in compliance with all applicable laws respecting employment and employment practices, terms and conditions of employment and wages and hours, and is not engaged in any unfair labor practices; there are no charges of discrimination or unfair labor practice charges” or complaints against SSHT pending or threatened before any governmental or regulatory agency or authority; and, there is no labor strike, dispute, slowdown or stoppage actually pending or threatened against or affecting SSHT.
III.20 Employment Arrangements. SSHT has no employment or consulting agreements or arrangements, written or oral, which are not terminable at the will of SSHT, or any pension, profit-sharing, option, other incentive plan, or any other type of employment benefit plan as defined in ERISA or otherwise, or any obligation to or customary arrangement with employees for bonuses, incentive compensation, vacations, severance pay, insurance or other benefits. No employee of SSHT is in violation of any employment agreement or restrictive covenant.
III.21 Filings. SSHT is not subject to filings required by the Exchange Act of 1934, as amended.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF WHL AND THE SHAREHOLDERS
WHL and the Shareholders, where applicable, represent and warrant to SSHT that the statements contained in this ARTICLE IV are correct and complete as of the date of this Agreement and, except as provided in Section 8.1, will be correct and complete as of the Closing Date (as though made then and as though the Closing Date were substituted for the date of this Agreement throughout this ARTICLE IV, except in the case of representations and warranties stated to be made as of the date of this Agreement or as of another date and except for Changes contemplated or permitted by the Agreement).
IV.1 Organization and Qualification. WHL has all requisite power and authority to own, lease and use WHL’s assets as they are currently owned, leased and used and to conduct its business as it is currently conducted. WHL is duly qualified or licensed to do business in and are each in good standing in each jurisdiction in which the character of the properties owned, leased or used by it or the nature of the activities conducted by it makes such qualification necessary, except any such jurisdiction where the failure to be so qualified or licensed and in good standing would not have a Material Adverse Effect on WHL or a Material Adverse Effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of WHL or the Shareholders to perform their obligations under this Agreement or any of the Collateral Documents.
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IV.2 Capitalization.
(a) The authorized capital stock of WHL is 50,000 ordinary shares. All 50,000 outstanding shares of WHL are owned by the Shareholders. WHL has no shares of preferred stock authorized. The shares of WHL ordinary stock are duly issued and outstanding, and have been duly authorized, validly issued and outstanding and fully paid and non-assessable, which shares are Exchanged hereby, as above provided.
(b) There no outstanding or authorized options, warrants, purchase rights, preemptive rights or other contracts or commitments that could require WHL or any of its Subsidiaries to issue, sell, or otherwise cause to become outstanding any of its capital stock or other ownership interests.
(c) All of the issued and outstanding shares of the WHL capital stock have been duly authorized and are validly issued and outstanding, fully paid and non-assessable (with respect to Subsidiaries that are corporations) and have been issued in compliance with applicable securities laws and other applicable Legal Requirements.
IV.3 Authority and Validity. WHL and the Shareholders have all requisite power to execute and deliver to perform its or their obligations under, and to consummate the transactions contemplated by, this Agreement and the Collateral Documents. The execution and delivery by WHL and the Shareholders and the performance by WHL and the Shareholders of their obligations under, and the consummation by WHL and the Shareholders of the transactions contemplated by, this Agreement and the Collateral Documents have been duly authorized by all requisite action of WHL and the Shareholders. This Agreement has been duly executed and delivered (assuming due execution and delivery by WHL and the Shareholders) is the legal, valid and binding obligation of the Shareholders, enforceable in accordance with its terms except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles. Upon the execution and delivery by WHL and the Shareholders of the Collateral Documents to which it is a party, if any, and assuming due execution and delivery thereof by the other parties thereto, the Collateral Documents will be the legal, valid and binding obligations, enforceable in accordance with their respective terms except that such enforcement may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting or relating to enforcement of creditors’ rights generally and (ii) general equitable principles.
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IV.4 No Breach or Violation. Subject to obtaining the consents, approvals, authorizations, and orders of and making the registrations or filings with or giving notices to Regulatory Authorities and Persons identified herein, the execution, delivery and performance by WHL or the Shareholders of this Agreement and the Collateral Documents to which they are a party and the consummation of the transactions contemplated hereby and thereby in accordance with the terms and conditions hereof and thereof, do not and will not conflict with, constitute a violation or breach of, constitute a default or give rise to any right of termination or acceleration of any right or obligation of the Shareholders under, or result in the creation or imposition of any Encumbrance upon the property of the Shareholders by reason of the terms of (i) the articles of incorporation, by laws or other charter or organizational document of WHL, (ii) any contract, agreement, lease, indenture or other instrument to which any the Shareholders or WHL are a party or by or to which the Shareholders or WHL or their property may be bound or subject and a violation of which would result in a Material Adverse Effect on the Shareholders or WHL taken as a whole, (iii) any order, judgment, injunction, award or decree of any arbitrator or Regulatory Authority or any statute, law, rule or regulation applicable to the Shareholders or WHL or (iv) any Permit of WHL or subsidiary, which in the case of (ii), (iii) or (iv) above would have a Material Adverse Effect on WHL or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of the Shareholders or WHL to perform their obligations hereunder or there under.
IV.5 Consents and Approvals. Except for requirements under applicable United States or state securities laws, no consent, approval, authorization or order of, registration or filing with, or notice to, any Regulatory Authority or any other Person is necessary to be obtained, made or given by WHL or the Shareholders in connection with the execution, delivery and performance by them of this Agreement or any Collateral Documents or for the consummation by them of the transactions contemplated hereby or thereby, except to the extent the failure to obtain such consent, approval, authorization or order or to make such registration or filings or to give such notice would not have a Material Adverse Effect on WHL or the Shareholders, in the aggregate, or a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents or the ability of WHL or the Shareholders to perform their obligations under this Agreement or any of the Collateral Documents.
IV.6 Compliance with Legal Requirements. WHL’s business has operated in compliance with all material Legal Requirements including, without limitation, the Securities Act applicable to WHL, except to the extent the failure to operate in compliance with all material Legal Requirements, would not have a Material Adverse Effect on WHL or a Material Adverse Effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents.
IV.7 Litigation. There are no outstanding judgments or orders against or otherwise affecting or related to WHL, or the business or assets; and there is no action, suit, complaint, proceeding or investigation, judicial, administrative or otherwise, that is pending or, to the best knowledge of either of the Shareholders, threatened that, that has not been disclosed and if adversely determined, would have a material adverse effect on the validity, binding effect or enforceability of this Agreement or the Collateral Documents.
IV.8 Ordinary Course. Since the date of its most recent balance sheet, dated September 30, 2022, there has not been any occurrence, event, incident, action, failure to act or transaction involving WHL, which is reasonably likely, individually or in the aggregate, to have a Material Adverse Effect on WHL.
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IV.9 Assets and Liabilities. As of the date of this Agreement, neither WHL nor any of its Subsidiaries has any assets or liability, except for the assets and liabilities disclosed in the balance sheet disclosed to SSHT through the date hereof.
IV.10 Taxes. WHL, and any Subsidiaries, has duly and timely filed in proper form all Tax Returns for all Taxes required to be filed with the appropriate Governmental Authority, except where such failure to file would not have a Material Adverse Effect on WHL.
IV.11 Books and Records. The books and records of WHL and any Subsidiaries accurately and fairly represent WHL’s business and its results of operations in all material respects. All accounts receivable and inventory of WHL’s business are reflected properly on such books and records in all material respects.
IV.12 Financial and Other Information. To the knowledge of the Shareholders, WHL’s financial statements do not contain (directly or by incorporation by reference) any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein (or incorporated therein by reference), in light of the circumstances under which they were or will be made, not misleading.
IV.13 Brokers or Finders. All negotiations relative to this Agreement and the transactions contemplated hereby have been carried out by WHL and/or its Affiliates/Representatives in connection with the transactions contemplated by this Agreement, neither WHL, nor any of its Affiliates/Representatives have incurred any obligation to pay any brokerage or finder’s fee or other commission in connection with the transaction contemplated by this Agreement.
IV.14 Disclosure. No representation or warranty of WHL, WHL, or the Shareholders in this Agreement or in the Collateral Documents and no statement in any certificate furnished or to be furnished by WHL or the Shareholders pursuant to this Agreement contained, contains or will contain on the date such agreement or certificate was or is delivered, or on the Closing Date, any untrue statement of a material fact, or omitted, omits or will omit on such date to state any material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading.
IV.15 Filings. WHL is not subject to filings required by the Securities Act of 1933, as amended, and the Exchange Act of 1934, as amended.
IV.16 Conduct of Business. Prior to the Closing Date, WHL shall conduct its business in the normal course, and shall not sell, pledge, or assign any assets, without the prior written approval of SSHT, except in the regular course of business. Except as otherwise provided herein, WHL shall not amend its Articles of Incorporation or By-Laws, declare dividends, redeem or sell stock or other securities, acquire or dispose of fixed assets, change employment terms, enter into any material or long-term contract, guarantee obligations of any third party, settle or discharge any material balance sheet receivable for less than its stated amount, pay more on any liability than its stated amount or enter into any other transaction other than in the regular course of business.
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ARTICLE V
COVENANTS OF SSHT
Between the date of this Agreement and the Closing Date:
V.1 Additional Information. SSHT shall provide to the Shareholders and her Representatives such financial, operating and other documents, data and information relating to SSHT, SSHT Business and SSHT’s assets and liabilities, as the Shareholders or her Representatives may reasonably request. In addition, SSHT shall take all action necessary to enable the Shareholders and their Representatives to review, inspect and review SSHT Assets, SSHT Business and Liabilities of SSHT and discuss them with SSHT’s officers, employees, independent accountants, customers, licensees, and counsel. Notwithstanding any investigation that the Shareholders may conduct of SSHT, SSHT Business, SSHT’s assets and the liabilities of SSHT, the Shareholders may fully rely on SSHT’s warranties, covenants and indemnities set forth in this Agreement.
V.2 Consents and Approvals. As soon as practicable after execution of this Agreement, SSHT shall use commercially reasonable efforts to obtain any necessary consent, approval, authorization or order of, make any registration or filing with or give any notice to, any Regulatory Authority or Person as is required to be obtained, made or given by SSHT to consummate the transactions contemplated by this Agreement and the Collateral Documents.
V.3 Non-circumvention. It is understood that in connection with the transactions contemplated hereby, SSHT will not, and it will cause its directors, officers, employees, agents and representatives not to attempt, directly or indirectly, (i) to contact any party introduced to it by the Shareholders, or (ii) deal with, or otherwise become involved in any transaction with any party which has been introduced to it by the Shareholders, without the express written permission of the introducing party. Any violation of the covenant shall be deemed an attempt to circumvent the Shareholders, and the party so violating this covenant shall be liable for damages in favor of the circumvented party.
V.4 No Solicitations. From and after the date of this Agreement until the Effective Time or termination of this Agreement pursuant to ARTICLE X, SSHT will not nor will it authorize or permit any of its officers, directors, affiliates or employees or any investment banker, attorney or other advisor or representative retained by it, directly or indirectly, (i) solicit or initiate the making, submission or announcement of any other acquisition proposal, (ii) participate in any discussions or negotiations regarding, or furnish to any person any nonpublic information with respect to any other acquisition proposal, (iii) engage in discussions with any Person with respect to any other acquisition proposal, except as to the existence of these provisions, (iv) approve, endorse or recommend any other acquisition proposal or (v) enter into any letter of intent or similar document or any contract agreement or commitment contemplating or otherwise relating to any other acquisition proposal.
V.5 Notification of Adverse Change. SSHT shall promptly notify the Shareholders of any material adverse change in the condition (financial or otherwise) of SSHT.
V.6 Notification of Certain Matters. SSHT shall promptly notify the Shareholders of any fact, event, circumstance or action known to it that is reasonably likely to cause SSHT to be unable to perform any of its covenants contained herein or any condition precedent in ARTICLE VII not to be satisfied, or that, if known on the date of this Agreement, would have been required to be disclosed to the Shareholders pursuant to this Agreement or the existence or occurrence of which would cause any of SSHT’s representations or warranties under this Agreement not to be correct and/or complete. SSHT shall give prompt written notice to the Shareholders of any adverse development causing a breach of any of the representations and warranties in ARTICLE III as of the date made.
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V.7 The Company Disclosure Schedule. For purposes of determining the satisfaction of any of the conditions to the obligations of the Shareholders in ARTICLE VII, SSHT disclosures shall be deemed to include only (a) the information contained therein on the date of this Agreement and (b) information provided by written supplements delivered prior to Closing by SSHT that (i) are accepted in writing by a majority of the Shareholders, or (ii) reflect actions taken or events occurring after the date hereof prior to Closing.
V.8 State Statutes. SSHT and its Board of Directors shall, if any state takeover statute or similar law is or becomes applicable to the Share Exchange, this Agreement or any of the transactions contemplated by this Agreement, use all reasonable efforts to ensure that the Share Exchange and the other transactions contemplated by this Agreement may be consummated as promptly as practicable on the terms contemplated by this Agreement and otherwise to minimize the effect of such statute or regulation on the Share Exchange, this Agreement and the transactions contemplated hereby.
V.9 Conduct of Business. Prior to the Closing Date, SSHT shall conduct its business in the normal course, and shall not sell, pledge, or assign any assets, without the prior written approval of the Shareholders, except in the regular course of business. Except as otherwise provided herein, SSHT shall not amend its Articles of Incorporation or Bylaws, declare dividends, redeem or sell stock or other securities, acquire or dispose of fixed assets, change employment terms, enter into any material or long-term contract, guarantee obligations of any third party, settle or discharge any material balance sheet receivable for less than its stated amount, pay more on any liability than its stated amount, or enter into any other transaction other than in the regular course of business.
V.10 Filings. Until closing, SSHT will timely file all reports and other documents relating to the operation of SSHT required to be filed, which reports and other documents do not and will not contain any misstatement of a material fact, and do not and will not omit any material fact necessary to make the statements therein not misleading.
ARTICLE VI
COVENANTS OF THE SHAREHOLDERS AND WHL
Between the date of this Agreement and the Closing Date,
VI.1 Additional Information. The Shareholders shall provide to SSHT and its Representatives such financial, operating and other documents, data and information relating to WHL, the WHL business and the WHL’s assets and the liabilities of the WHL and its Subsidiaries, as SSHT or its Representatives may reasonably request. In addition, the Shareholders shall take all action necessary to enable SSHT and its Representatives to review and inspect the WHL assets, the WHL business and the liabilities of WHL and discuss them with SSHT’s officers, employees, independent accountants and counsel. Notwithstanding any investigation that SSHT may conduct of WHL, the WHL business, the WHL’s assets and the liabilities of the WHL, SSHT may fully rely on the Shareholders’ warranties, covenants and indemnities set forth in this Agreement.
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VI.2 No Solicitations. From and after the date of this Agreement until the Effective Time or termination of this Agreement pursuant to ARTICLE X, the Shareholders will not nor will she authorize or permit any of WHL’s officers, directors, affiliates or employees or any investment banker, attorney or other advisor or representative retained by it, directly or indirectly, (i) solicit or initiate the making, submission or announcement of any other acquisition proposal, (ii) participate in any discussions or negotiations regarding, or furnish to any person any non-public information with respect to any other acquisition proposal, (iii) engage in discussions with any Person with respect to any other acquisition proposal, except as to the existence of these provisions, (iv) approve, endorse or recommend any other acquisition proposal or (v) enter into any letter of intent or similar document or any contract agreement or commitment contemplating or otherwise relating to any other acquisition proposal.
VI.3 Notification of Adverse Change. The Shareholders shall promptly notify SSHT of any material adverse Change in the condition (financial or otherwise) of WHL.
VI.4 Consents and Approvals. As soon as practicable after execution of this Agreement, WHL and the Shareholders shall use his commercially reasonable efforts to obtain any necessary consent, approval, authorization or order of, make any registration or filing with or give notice to, any Regulatory Authority or Person as is required to be obtained, made or given by WHL or the Shareholders to consummate the transactions contemplated by this Agreement and the Collateral Documents.
VI.5 Notification of Certain Matters. The Shareholders shall promptly notify SSHT of any fact, event, circumstance or action known to them that is reasonably likely to cause WHL to be unable to perform any of its covenants contained herein or any condition precedent if not to be satisfied, or that, if known on the date of this Agreement, would have been required to be disclosed to SSHT pursuant to this Agreement or the existence or occurrence of which would cause the Shareholders’ representations or warranties under this Agreement not to be correct and/or complete. The Shareholders shall give prompt written notice to SSHT of any adverse development causing a breach of any of the representations and warranties in ARTICLE IV.
ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF WHL AND THE SHAREHOLDERS
All obligations of WHL and the Shareholders under this Agreement shall be subject to the fulfillment at or prior to Closing of each of the following conditions, it being understood that the Parties may, in their sole discretion, to the extent permitted by applicable Legal Requirements, waive any or all of such conditions in whole or in part.
VII.1 Accuracy of Representations. All representations and warranties of SSHT contained in this Agreement, the Collateral Documents and any certificate delivered by any of SSHT at or prior to Closing shall be, if specifically qualified by materiality, true in all respects and, if not so qualified, shall be true in all material respects, in each case on and as of the Closing Date with the same effect as if made on and as of the Closing Date, except for representations and warranties expressly stated to be made as of the date of this Agreement or as of another date other than the Closing Date and except for Changes contemplated or permitted by this Agreement.
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VII.2 Covenants. SSHT shall, in all material respects, have performed and complied with each of the covenants, obligations and agreements contained in this Agreement and the Collateral Documents that are to be performed or complied with by them at or prior to Closing.
VII.3 Consents and Approvals. All consents, approvals, permits, authorizations and orders required to be obtained from, and all registrations, filings and notices required to be made with or given to, any Regulatory Authority or Person as provided herein.
VII.4 Delivery of Documents. SSHT shall have delivered, or caused to be delivered, to the Shareholders the following documents:
(i) Copies of SSHT articles of incorporation and bylaws and resolutions of the board of directors of SSHT authorizing the execution of this Agreement and the Collateral Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby.
(ii) Such other documents and instruments as the Shareholders may reasonably request: (A) to evidence the accuracy of SSHT’s representations and warranties under this Agreement, the Collateral Documents and any documents, instruments or certificates required to be delivered hereunder; (B) to evidence the performance by SSHT of, or the compliance by SSHT with, any covenant, obligation, condition and agreement to be performed or complied with by SSHT under this Agreement and the Collateral Documents; or (C) to otherwise facilitate the consummation or performance of any of the transactions contemplated by this Agreement and the Collateral Documents.
VII.5 No Material Adverse Change. Since the date hereof, there shall have been no material adverse change in SSHT’s Assets, the SSHT Business or the financial condition or operations of SSHT, taken as a whole.
ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS OF SSHT
All obligations of SSHT under this Agreement shall be subject to the fulfillment at or prior to Closing of the following conditions, it being understood that SSHT may, in its sole discretion, to the extent permitted by applicable Legal Requirements, waive any or all of such conditions in whole or in part.
VIII.1 Accuracy of Representations. All representations and warranties of WHL and the Shareholders contained in this Agreement and the Collateral Documents and any other document, instrument or certificate delivered by WHL or the Shareholders at or prior to the Closing shall be, if specifically qualified by materiality, true and correct in all respects and, if not so qualified, shall be true and correct in all material respects, in each case on and as of the Closing Date with the same effect as if made on and as of the Closing Date, except for representations and warranties expressly stated to be made as of the date of this Agreement or as of another date other than the Closing Date and except for Changes contemplated or permitted by this Agreement.
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VIII.2 Covenants. WHL and the Shareholders shall, in all material respects, have performed and complied with each obligation, agreement, covenant and condition contained in this Agreement and the Collateral Documents and required by this Agreement and the Collateral Documents to be performed or complied with by the Shareholders at or prior to Closing.
VIII.3 Consents and Approvals. All consents, approvals, authorizations and orders required to be obtained from, and all registrations, filings and notices required to be made with or given to, any Regulatory Authority or Person as provided herein.
VIII.4 Delivery of Documents. WHL and the Shareholders shall have executed and delivered, or caused to be executed and delivered, to SSHT the following documents:
Documents and instruments as SSHT may reasonably request: (A) to evidence the accuracy of the representations and warranties of the Shareholders and WHL under this Agreement and/or the Collateral Documents and any documents, instruments or certificates required to be delivered hereunder; (B) to evidence the performance by the Shareholders of, or the compliance by the Shareholders with, any covenant, obligation, condition and agreement to be performed or complied with by the Shareholders under this Agreement and the Collateral Documents; or (C) to otherwise facilitate the consummation or performance of any of the transactions contemplated by this Agreement and the Collateral Documents.
VIII.5 No Material Adverse Change. There shall have been no material adverse change in the business, financial condition or operations of WHL and its Subsidiaries taken as a whole.
VIII.6 No Litigation. No action, suit or proceeding shall be pending or threatened by or before any Regulatory Authority and no Legal Requirement shall have been enacted, promulgated or issued or deemed applicable to any of the transactions contemplated by this Agreement and the Collateral Documents that would: (i) prevent consummation of any of the transactions contemplated by this Agreement and the Collateral Documents; (ii) cause any of the transactions contemplated by this Agreement and the Collateral Documents to be rescinded following consummation; or (iii) have a Material Adverse Effect on WHL.
ARTICLE IX
INDEMNIFICATION
IX.1 Indemnification by SSHT. SSHT shall indemnify, defend and hold harmless (i) the Shareholders, (ii) any the Shareholders’ assigns and successors in interest to SSHT Shares, and (iii) each of the Shareholders, members, partners, directors, officers, managers, employees, agents, attorneys and representatives, from and against any and all Losses which may be incurred or suffered by any such party and which may arise out of or result from any breach of any material representation, warranty, covenant or agreement of SSHT contained in this Agreement. All claims to be assorted hereunder must be made for the first anniversary of the Closing.
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IX.2 Indemnification by the Shareholders. WHL and the Shareholders shall indemnify, defend and hold harmless SSHT from and against any and all Losses which may be incurred or suffered by any such party hereto and which may arise out of or result from any breach of any material representation, warranty, covenant or agreement of the Shareholders contained in this Agreement. All claims to be assorted hereunder must be made for the first anniversary of the Closing.
IX.3 Notice to Indemnifying Party. If any party (the “Indemnified Party”) receives notice of any claim or other commencement of any action or proceeding with respect to which any other party (or parties) (the “Indemnifying Party”) is obligated to provide indemnification pursuant to Sections 9.1 or 9.2, the Indemnified Party shall promptly give the Indemnifying Party written notice thereof, which notice shall specify in reasonable detail, if known, the amount or an estimate of the amount of the liability arising here from and the basis of the claim. Such notice shall be a condition precedent to any liability of the Indemnifying Party for indemnification hereunder, but the failure of the Indemnified Party to give prompt notice of a claim shall not adversely affect the Indemnified Party’s right to indemnification hereunder unless the defense of that claim is materially prejudiced by such failure. The Indemnified Party shall not settle or compromise any claim by a third party for which it is entitled to indemnification hereunder without the prior written consent of the Indemnifying Party (which shall not be unreasonably withheld or delayed) unless suit shall have been instituted against it and the Indemnifying Party shall not have taken control of such suit after notification thereof as provided in Section 9.4.
IX.4 Defense by Indemnifying Party. In connection with any claim giving rise to indemnity hereunder resulting from or arising out of any claim or legal proceeding by a Person who is not a party to this Agreement, the Indemnifying Party at its sole cost and expense may, upon written notice to the Indemnified Party, assume the defense of any such claim or legal proceeding (i) if it acknowledges to the Indemnified Party in writing its obligations to indemnify the Indemnified Party with respect to all elements of such claim (subject to any limitations on such liability contained in this Agreement) and (ii) if it provides assurances, reasonably satisfactory to the Indemnified Party, that it will be financially able to satisfy such claims in full if the same are decided adversely. If the Indemnifying Party assumes the defense of any such claim or legal proceeding, it may use counsel of its choice to prosecute such defense, subject to the approval of such counsel by the Indemnified Party, which approval shall not be unreasonably withheld or delayed. The Indemnified Party shall be entitled to participate in (but not control) the defense of any such action, with its counsel and at its own expense; provided, however, that if the Indemnified Party, in its sole discretion, determines that there exists a conflict of interest between the Indemnifying Party (or any constituent party thereof) and the Indemnified Party, the Indemnified Party (or any constituent party thereof) shall have the right to engage separate counsel, the reasonable costs and expenses of which shall be paid by the Indemnified Party. If the Indemnifying Party assumes the defense of any such claim or legal proceeding, the Indemnifying Party shall take all steps necessary to pursue the resolution thereof in a prompt and diligent manner. The Indemnifying Party shall be entitled to consent to a settlement of, or the stipulation of any judgment arising from, any such claim or legal proceeding, with the consent of the Indemnified Party, which consent shall not be unreasonably withheld or delayed; provided, however, that no such consent shall be required from the Indemnified Party if (i) the Indemnifying Party pays or causes to be paid all Losses arising out of such settlement or judgment concurrently with the effectiveness thereof (as well as all other Losses theretofore incurred by the Indemnified Party which then remain unpaid or unreimbursed), (ii) in the case of a settlement, the settlement is conditioned upon a complete release by the claimant of the Indemnified Party and (iii) such settlement or judgment does not require the encumbrance of any asset of the Indemnified Party or impose any restriction upon its conduct of business.
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ARTICLE X
TERMINATION
X.1 Termination. This Agreement may be terminated, and the transactions contemplated hereby may be abandoned, at any time prior to it being fully executed, or thereafter:
(a) by mutual written agreement of the Shareholders and SSHT hereto duly authorized by action taken by or on behalf of the respective Boards of Directors; or
(b) by any of SSHT or the Shareholders upon notification to the non-terminating party by the terminating party:
(i) if the terminating party is not in material breach of its obligations under this Agreement and there has been a material breach of any representation, warranty, covenant or agreement on the part of the non-terminating party set forth in this Agreement such that the conditions will not be satisfied; provided, however, that if such breach is curable by the non-terminating party and such cure is reasonably likely to be completed prior to the Closing Date; or
(ii) if any court of competent jurisdiction or other competent Governmental or Regulatory Authority shall have issued an order making illegal or otherwise permanently restricting, preventing or otherwise prohibiting the Share Exchange and such order shall have become final.
(c) Effect of Termination. If this Agreement is validly terminated by either SSHT or the Shareholders pursuant to Section 10.1, this Agreement will forthwith become null and void and there will be no liability or obligation on the part of the parties hereto, except that nothing contained herein shall relieve any party hereto from liability for willful breach of its representations, warranties, covenants or agreements contained in this Agreement.
ARTICLE XI
MISCELLANEOUS
XI.1 Parties Obligated and Benefited. This Agreement shall be binding upon the Parties and their respective successors by operation of law and shall inure solely to the benefit of the Parties and their respective successors by operation of law, and no other Person shall be entitled to any of the benefits conferred by this Agreement. Without the prior written consent of the other Party, no Party may assign this Agreement or the Collateral Documents or any of its rights or interests or delegate any of its duties under this Agreement or the Collateral Documents.
XI.2 Publicity. All press release shall be joint press releases between SSHT and WHL and each shall consult with each other prior to issuing any press releases or otherwise making public announcements with respect to the Share Exchange and the other transactions contemplated by this Agreement and prior to making any filings with any third party and/or any Regulatory Authorities (including any national securities inter dealer quotation service) with respect thereto, except as may be required by law or by obligations pursuant to any listing agreement with or rules of any national securities inter dealer quotation service.
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XI.3 Notices. Any notices and other communications required or permitted hereunder shall be in writing and shall be effective upon delivery by hand or upon receipt if sent by certified or registered mail (postage prepaid and return receipt requested) or by a nationally recognized overnight courier service (appropriately marked for overnight delivery) or upon transmission if sent by telex or facsimile (with request for immediate confirmation of receipt in a manner customary for communications of such respective type and with physical delivery of the communication being made by one or the other means specified in this Section as promptly as practicable thereafter). Notices shall be addressed as follows:
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If to the Shareholders or WHL: |
Wahoo Holdings Limited. OMC Chambers, Wickhams Cay 1 Road Town, Tortola, British Virgin Islands |
| If to SSHT: | SSHT S&T GROUP LTD 46 Reeves Road, Pakuranga Auckland, New Zealand |
XI.4 Addresses. Any Party may change the address to which notices are required to be sent by giving notice of such change in the manner provided in this Section.
XI.5 Attorneys’ Fees. In the event of any action or suit based upon or arising out of any alleged breach by any Party of any representation, warranty, covenant or agreement contained in this Agreement or the Collateral Documents, the prevailing Party shall be entitled to recover reasonable attorneys’ fees and other costs of such action or suit from the other Party.
XI.6 Headings. The Article and Section headings of this Agreement are for convenience only and shall not constitute a part of this Agreement or in any way affect the meaning or interpretation thereof.
XI.7 Choice of Law. This Agreement and the rights of the Parties under it shall be governed by and construed in all respects in accordance with the laws of the State of Nevada, without giving effect to any choice of law provision or rule.
XI.8 Rights Cumulative. All rights and remedies of each of the Parties under this Agreement shall be cumulative, and the exercise of one or more rights or remedies shall not preclude the exercise of any other right or remedy available under this Agreement or applicable law.
XI.9 Further Actions. The Parties shall execute and deliver to each other, from time to time at or after Closing, for no additional consideration and at no additional cost to the requesting party, such further assignments, certificates, instruments, records, or other documents, assurances or things as may be reasonably necessary to give full effect to this Agreement and to allow each party fully to enjoy and exercise the rights accorded and acquired by it under this Agreement.
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XI.10 Time of the Essence. Time is of the essence under this Agreement. If the last day permitted for the giving of any notice or the performance of any act required or permitted under this Agreement falls on a day which is not a Business Day, the time for the giving of such notice or the performance of such act shall be extended to the next succeeding Business Day.
XI.11 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
XI.12 Entire Agreement. This Agreement (including the Exhibits, disclosures made as to SSHT, the WHL financial statements, the SSHT financial statements, and any other documents, instruments and certificates referred to herein, which are incorporated in and constitute a part of this Agreement) contains the entire agreement of the Parties.
XI.13 Survival of Representations and Covenants. Notwithstanding any right of the Shareholders to fully investigate the affairs of SSHT and notwithstanding any knowledge of facts determined or determinable by the Shareholders pursuant to such investigation or right of investigation, the Shareholders shall have the right to rely fully upon the representations, warranties, covenants and agreements of SSHT contained in this Agreement. Each representation, warranty, covenant and agreement of SSHT contained herein shall survive the execution and delivery of this Agreement and the Closing and shall thereafter terminate and expire on the first anniversary of the Closing Date unless, prior to such date, the Shareholders have delivered to SSHT a written notice of a claim with respect to such representation, warranty, covenant or agreement.
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IN WITNESS WHEREOF, the Parties hereto have duly executed this Agreement as of the day and year first above written.
| Dated: December 5, 2022 | |||
| Wahoo Holdings Limited. | |||
| By: | |||
| Name: | Xiaobei Huang | ||
| Title: | Director | ||
| Xiaobei Huang | |||
| Dan Sun | |||
| Desheng Zhou | |||
| Cheng Xu | |||
| SSHT S&T Group Ltd | |||
| By: | |||
| Name: | Zonghan Wu | ||
| Title: | Chairman | ||
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Exhibit 21.1
SSHT S&T Group Ltd.
List of Subsidiaries
| Subsidiary | State or Jurisdiction of Incorporation | Percentage Owned | ||||
| Wahoo Holdings, Ltd. | British Virgin Islands | 100 | % | |||
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors
SSHT S&T Group Ltd.
We consent to the inclusion in this Form S-1 to the Registration Statement of SSHT S&T Group Ltd. of our report dated April 28, 2023 relating to the financial statements of SSHT S&T Group Ltd. which report appears in the Prospectus, which is part of this Registration Statement.
We also consent to the reference to our Firm under the heading “Experts” in such Prospectus.
/s/ Shandong Haoxin CPA Co., Ltd.
Shandong Haoxin CPA Co., Ltd.
Certified Public Accountants
Weifang, People’s Republic of China
May 11, 2023