Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | May 29, 2020 | Jun. 28, 2019 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Future FinTech Group Inc. | ||
Entity Central Index Key | 0001066923 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | No | ||
Entity Emerging Growth Company | false | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 9,570,000 | ||
Entity Common Stock, Shares Outstanding | 38,345,415 | ||
Entity File Number | 001-34502 | ||
Entity Interactive Data Current | Yes | ||
Entity Incorporation State Country Code | FL |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 539,316 | $ 253,804 |
Accounts receivable, net of allowance of $16,127,000 as of December 31, 2019 and $15,650,217 as of December 31, 2018, respectively | 4,954 | 73,244 |
Other receivables | 7,489 | 23,774,163 |
Inventories | 3,594 | 63,017 |
Advances to suppliers and other current assets | 1,668,847 | |
Assets related to discontinued operations | 92,772,786 | |
TOTAL CURRENT ASSETS | 94,996,986 | 24,164,227 |
Property, plant and equipment, net | 17,855 | 2,336,036 |
Intangible assets | 5,312,906 | 21,446,345 |
Amount due from related parties | 3,402,823 | |
Long-term investments | 12,250,000 | 15,000,000 |
TOTAL ASSETS | 115,980,570 | 62,946,609 |
CURRENT LIABILITIES | ||
Accounts payable | 320,378 | 11,054,290 |
Accrued expenses | 4,547,380 | 99,131,073 |
Advances from customers | 702,179 | 1,160,029 |
Short-term bank loans | 957,990 | 5,828,185 |
Liabilities related to discontinued operations | 196,261,748 | |
TOTAL CURRENT LIABILITIES | 202,789,675 | 117,173,578 |
NON-CURRENT LIABILITIES | ||
Amount Due to Related Party | 1,268,101 | |
Long-term loan | 32,450,867 | |
TOTAL NON-CURRENT LIABILITIES | 1,268,101 | 32,450,867 |
TOTAL LIABILITIES | 204,057,776 | 149,624,445 |
Commitments and contingencies (Note 16) | ||
Future FinTech Group, Inc, Stockholders' equity | ||
Common stock, $0.001 par value; 60,000,000 shares authorized and 33,810,416 shares and 31,017,083 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively | 33,810 | 31,017 |
Additional paid-in capital | 107,852,827 | 105,737,256 |
Accumulated deficits | (213,314,612) | (188,085,680) |
Accumulated other comprehensive income (loss) | 12,989,408 | (8,961,549) |
Total Future FinTech Group, Inc. stockholders' equity | (92,438,567) | (91,278,957) |
Non-controlling interests | 4,361,361 | 4,601,121 |
Total stockholders' equity | (88,077,206) | (86,677,836) |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 115,980,570 | $ 62,946,609 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, net of allowance | $ 16,127,000 | $ 15,650,217 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 33,810,416 | 31,017,083 |
Common stock, shares outstanding | 33,810,416 | 31,017,083 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | ||
Revenue | $ 955,172 | $ 888,670 |
Cost of goods sold | 464,307 | 975,042 |
Gross profit | 490,865 | (86,372) |
Operating Expenses | ||
General and administrative expenses | 4,913,656 | 11,944,924 |
Selling expenses | 500,949 | 188,579 |
Bad debt provision | 5,234,205 | |
Inventory markdown | 27,247 | |
Impairment Loss | 2,751,099 | 178,296,747 |
Total operating expenses | 13,427,156 | 190,430,250 |
Loss from operations | (12,936,291) | (190,516,623) |
Other (expenses) income | ||
Interest income | 3,995 | 1,372 |
Interest expenses | (523,676) | (1,624,683) |
Other income(expenses), net | (229,042) | 2,387,813 |
Total other income (expenses), net | (748,723) | 764,502 |
Loss from Continuing Operations before Income Tax | (13,685,014) | (189,752,121) |
Income tax provision | 237 | |
Loss from Continuing Operations before Non-controlling Minority Interest | (13,685,014) | (189,752,358) |
Less: Net loss attributable to non-controlling interests | (163,576) | (15,741,937) |
Loss from Continuing Operations | (13,521,438) | (174,010,421) |
Discontinued Operations (Note 18) | ||
Income (loss) from discontinued operations | (11,707,494) | 4,013,367 |
NET LOSS ATTRIBUTABLE TO FUTURE FINTECH GROUP, INC. | (25,228,932) | (169,997,054) |
Other comprehensive loss, net | ||
Net loss | (27,074,245) | (169,997,054) |
Foreign currency translation, net of tax | 23,556,511 | 85,180,932 |
Comprehensive loss | (3,517,734) | (100,558,059) |
Less: Comprehensive loss attributable to non-controlling interests | (239,760) | |
COMPREHENSIVE LOSS ATTRIBUTABLE TO FUTURE FINTECH GROUP INC. STOCKHOLDERS | $ (3,277,974) | $ (100,558,059) |
Earnings per share: | ||
Basic earnings per share from continued operation | $ (0.42) | $ (8.04) |
Basic earnings per share from discontinued operation | (0.37) | 0.19 |
Basic earnings per share from net income | (0.79) | (7.85) |
Diluted Earnings per share: | ||
Diluted loss per share from continued operation | (0.42) | (7.92) |
Diluted earnings per share from discontinued operation | (0.37) | 0.18 |
Diluted earnings per share from net income | $ (0.79) | $ (7.74) |
Weighted average number of shares outstanding | ||
Basic | 31,996,279 | 21,636,146 |
Diluted | 31,996,279 | 21,966,612 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) | Common Stock | Additional paid-in capital | Accumulated deficits | Accumulative Other comprehensive income | Non-controlling interests | Total |
Balance at Dec. 31, 2017 | $ 5,173 | $ 109,090,782 | $ (2,346,689) | $ (94,142,381) | $ 20,343,058 | $ 32,949,843 |
Balance, shares at Dec. 31, 2017 | 5,173,234 | |||||
Common Stocks issued during 2018 | $ 25,844 | 155,970 | 181,814 | |||
Common Stocks issued during 2018, shares | 25,843,849 | |||||
Net loss | (169,997,054) | (15,741,937) | (189,752,358) | |||
Foreign currency translation adjustment | (3,509,496) | (15,741,937) | 85,180,832 | 65,929,499 | ||
Balance at Dec. 31, 2018 | $ 31,017 | 105,737,256 | (188,085,680) | (8,961,549) | 4,601,121 | (86,677,836) |
Balance, shares at Dec. 31, 2018 | 31,017,083 | |||||
Share based compensation | $ 1,300 | 702,000 | 703,300 | |||
Share based compensation, shares | 1,300,000 | |||||
Issuance of common stock for conversion of debts | $ 1,493 | 1,413,571 | 1,415,064 | |||
Issuance of common stock for conversion of debts, shares | 1,493,333 | |||||
Net loss | (25,228,932) | (1,845,313) | (13,685,014) | |||
Foreign currency translation adjustment | 21,950,957 | 1,605,554 | 23,556,511 | |||
Balance at Dec. 31, 2019 | $ 33,810 | $ 107,852,827 | $ (213,314,612) | $ 12,989,408 | $ 4,361,361 | $ (88,077,206) |
Balance, shares at Dec. 31, 2019 | 33,810,416 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (27,074,245) | $ (169,997,054) |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 4,674,923 | |
Bad debt provision | 5,234,205 | |
Inventory markdown | 27,247 | |
Impairment loss | 2,750,000 | 178,296,747 |
Share based compensation | 702,000 | |
Changes in operating assets and liabilities | ||
Accounts receivable | (495) | (17,082,886) |
Other receivable | 124,533 | (12,939,323) |
Advances to suppliers and other current assets | (1,668,847) | 2,805,215 |
Inventories | (30,841) | (4,246,665) |
Accounts payable | (1,731,528) | (223,416) |
Accrued expenses | (15,939,575) | (779,504) |
Changes in net assets related to discontinued operations | 13,756,540 | |
Advances from customers | 314,228 | 504,091 |
Net cash used in operating activities | (15,839,843) | (4,880,137) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Additions to property, plant and equipment | (5,006) | |
Purchase of intangible assets | (43,003) | |
Net cash used in investing activities | (48,009) | |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Issue of common stock | 155,970 | |
Changes in financing amount due to/from related parties | (2,134,722) | |
Proceeds from Secured Convertible Promissory Note | 1,503,793 | |
Changes in net assets related to discontinued operations | (4,800,701) | |
Net cash (used in) provided by financing activities | (5,431,630) | 155,970 |
Effect of change in exchange rate | 21,728,082 | 390,494 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 408,599 | (4,333,673) |
Cash and cash equivalents, beginning of year | 253,804 | 4,586,757 |
Cash and cash equivalents, end of year | 539,316 | 253,804 |
Less: Cash and cash equivalents from the discontinued operations, end of year | (123,087) | |
Cash and cash equivalents, from the continuing operations end of year | 539,316 | 253,804 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Cash paid for interest | ||
Cash paid for income taxes | ||
SUPPLEMENTARY DISCLOSURE OF SIGNIFICANT NON-CASH TRANSACTION | ||
Conversion of convertible notes | $ 1,415,064 |
Corporate Information
Corporate Information | 12 Months Ended |
Dec. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
CORPORATE INFORMATION | 1. CORPORATE INFORMATION Future FinTech is a holding company incorporated under the laws of the State of Florida. The Company engages in the production and sale of fruit juice concentrates (including fruit purees and fruit juices), fruit beverages (including fruit juice beverages and fruit cider beverages) in the PRC. Due to drastically increased production cost and tightened environmental laws in China, the Company transformed its business from fruit juice manufacturing and distribution to a real-name blockchain e-commerce platform that integrates blockchain and internet technology in 2018. The main business of the Company includes a shopping platform, Chain Cloud Mall (CCM), which is based on blockchain technology; a cross-border e-commerce platform (NONOGIRL) which is online and has started its trial operation in March 2020 and is expected for a formal launch in the third quarter of 2020; a blockchain-based application incubator and a digital payment system (DCON); and the application and development of blockchain-based e-commerce technology and financial technology. The Company's activities are principally conducted by subsidiaries operating in the PRC. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of preparation and principle of consolidation These financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, or US GAAP. The Company's functional currency of subsidiaries and VIEs in China is the Chinese Renminbi (RMB). Other subsidiaries outside of China use USD as the functional currency; however, the accompanying consolidated financial statements have been translated and presented in USD. According to USGAAP ASC 810-10-15-8, for legal entities other than limited partnerships, the usual condition for a controlling financial interest is ownership of a majority voting interest, and, therefore, as a general rule ownership by one reporting entity, directly or indirectly, of more than 50 percent of the outstanding voting shares of another entity is a condition pointing toward consolidation. The power to control may also exist with a lesser percentage of ownership, for example, by contract, lease, agreement with other stockholders, or by court decree. The consolidated financial statements include the accounts of the Company and its subsidiaries. The consolidated financial statements are prepared in accordance with U.S. GAAP. This basis differs from that used in the statutory accounts of subsidiaries and VIEs in the PRC, which were prepared in accordance with the accounting principles and relevant financial regulations applicable to enterprises in the PRC. All necessary adjustments have been made to present the financial statements in accordance with U.S. GAAP. All significant inter-company accounts and transactions have been eliminated. Certain amounts of prior years were reclassified to conform with current year presentation. Discontinued Operations As discussed previously, On February 27, 2020, SkyPeople BVI (the "Seller") completed the transfer of its ownership of HeDeTang HK to New Continent International Co., Ltd. (the "Buyer"), an unrelated third party and a company incorporated in the British Virgin Islands for a total price of RMB 0.6 million (approximately $85,714), pursuant to a Share Transfer Agreement entered into by the Seller and the Buyer on September 18, 2019 and approved at the special shareholders meeting of the Company on February 26, 2020. As the Company believed that no continued cash flow would be generated by the sold component, in accordance with ASC 205-20, the Company presented the operating results from Hedetang as discontinued operations within the accompanying consolidated financial statements. In addition, The Company's Huludao Wonder operation, a subsidiary which produces concentrated apple juice, suffered continued operating losses since 2014 and its cash flow was minimal for these three years. In December 2016, the Company established a winding-down plan to close this operation. Based on the restructuring plan and in accordance with ASC 205-20, the Company presented the operating results from Huludao Wonder as a discontinued operation. On March 11,2020, the Company's Board of Directors passed a resolution to sale the operation of Globalkey Supply Chain limited and Zhonglian Hengxin Assets Management Co. Ltd and close the operation of Digital Online Marketing Limited, Future Digital Fintech (Xi'an) Co. Ltd., SkyPeople Foods Holding Ltd. and Chain Future Digital Tech (Beijing) Co. Ltd. Based on the disposal plan and in accordance with ASC 205-20, the Company presented the operating results from these operations as a discontinued operation. Segment Information Reclassification Historically, the Company operated in five segments: concentrated apple juice and apple aroma, concentrated kiwifruit juice and kiwifruit puree, concentrated pear juice, fruit juice beverages, and others. As the Company classified the juice related operation into discontinued operation, in the beginning of year 2019, and in accordance with the Company's new business strategy, the Company classified business segment into CCM Shopping Mall Membership, sales of goods and others. Use of Estimates The Company's consolidated financial statements have been prepared in accordance with US GAAP and this requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenue and expenses during the reporting period. The significant areas requiring the use of management estimates include, but not limited to, the allowance for doubtful accounts receivable, estimated useful life and residual value of property, plant and equipment, impairment of long-lived assets provision for staff benefit, valuation of change in fair value of warrant liability, recognition and measurement of deferred income taxes and valuation allowance for deferred tax assets. Although these estimates are based on management's knowledge of current events and actions management may undertake in the future, actual results may ultimately differ from those estimates and such differences may be material to our consolidated financial statements. Going Concern The Company's financial statements are prepared assuming that the Company will continue as a going concern. The Company incurred operating losses and had negative operating cash flows and may continue to incur operating losses and generate negative cash flows as the Company implements its future business plan. In order to meet its working capital needs through the next twelve months and to fund the growth of the Company, the Company may consider plans to raise additional funds through the issuance of equity or debt. Although the Company intends to obtain additional financing to meet its cash needs, the Company may be unable to secure any additional financing on terms that are favorable or acceptable to it, if at all. The ability of the Company to continue as a going concern is dependent upon its ability to successfully execute its new business strategy and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern. Impairment of Long-Lived Assets In accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell. Fair Value of Financial Instruments The Company has adopted FASB Accounting Standard Codification Topic on Fair Value Measurements and Disclosures ("ASC 820"), which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. ASC 820 establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable input, which may be used to measure fair value and include the following: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Input other than Level 1 that is observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other input that is observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable input that is supported by little or no market activity and that is significant to the fair value of the assets or liabilities. Our cash and cash equivalents and restricted cash are classified within level 1 of the fair value hierarchy because they are value using quoted market price. Earnings (Loss) Per Share Under ASC 260-10, Earnings Per Share Diluted EPS is calculated by using the treasury stock method, assuming conversion of all potentially dilutive securities, such as stock options and warrants. Under this method, (i) exercise of options and warrants is assumed at the beginning of the period and shares of Common Stock are assumed to be issued, (ii) the proceeds from exercise are assumed to be used to purchase Common Stock at the average market price during the period, and (iii) the incremental shares (the difference between the number of shares assumed issued and the number of shares assumed purchased) are included in the denominator of the diluted EPS computation. The numerators and denominators used in the computations of basic and diluted EPS are presented in the following table. Year Ended December 31, 2019 2018 NUMERATOR FOR BASIC AND DILUTED EPS Net loss from continuing operations (numerator for EPS) $ (13,521,438 ) $ (174,010,421 ) Net (income) )loss from discontinued operations (numerator for EPS) (11,707,493 ) 4,013,367 Net loss allocated to Common Stockholders $ (25,228,932 ) $ (169,997,054 ) Loss per share: Basic loss per share from continued operations $ (0.47 ) $ (8.04 ) Basic income (loss) per share from discontinued operations (0.37) 0.19 Basic loss per share from net loss $ (0.79 ) $ (7.85 ) Diluted loss per share: Diluted loss per share from discontinued operations $ (0.47 ) $ (7.92 ) Diluted income (loss) per share from discontinued operations (0.37) 0.18 Diluted loss per share from net loss $ (0.79 ) $ (7.74 ) Weighted average Common Stock outstanding 31,996,279 21,636,146 DENOMINATOR FOR BASIC AND DILUTED EPS 31,996,279 21,966,612 Cash and Cash Equivalents Cash and cash equivalents included cash on hand and demand deposits placed with banks or other financial institutions, which are unrestricted as to withdrawal and use and with an original maturity of three months or less. Deposits in banks in the PRC are only insured by the government up to RMB500,000, and are consequently exposed to risk of loss. The Company believes the probability of a bank failure, causing loss to the Company, is remote. Accounts Receivable and Allowances Accounts receivable are recognized and carried at the original invoice amounts less an allowance for any uncollectible amount. We have a policy of reserving for uncollectible accounts based on our best estimate of the amount of probable credit losses in our existing accounts receivable. We extend credit to our customers based on an evaluation of their financial condition and other factors. We generally do not require collateral or other security to support accounts receivable. We perform ongoing credit evaluations of our customers and maintain an allowance for potential bad debts if required. We determine whether an allowance for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. In these cases, we use assumptions and judgment, based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The amounts calculated are analyzed to determine the total amount of the allowance. We may also record a general allowance as necessary. Direct write-offs are taken in the period when we have exhausted our efforts to collect overdue and unpaid receivable or otherwise evaluate other circumstances that indicate that we should aban don such efforts. The Company has assessed its accounts receivable including credit term and corresponding all its accounts receivables in December 2019. Upon such credit terms, bad debt expense was increased by $5.23 million and $16.31 million during the years ended December 31, 2019 and 2018, respectively. Accounts receivables of $2,477 and $619.13 million have been outstanding for over 90 days as of December 31, 2019 and December 31, 2018, respectively. Inventories Inventories consist of raw materials, packaging materials (which include ingredients and supplies) and finished goods (which include finished juice in the bottling, canning operations and other. Inventories also consist of merchant gift package to be delivered with the new membership signed up in our e-commerce platform. Inventories are valued at the lower of cost or market. We determine cost on the basis of the weighted average method. The Company periodically reviews inventories for obsolescence and any inventories identified as obsolete are written off. Revenue Recognition We adopted Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (ASC 606) and all related amendment from January 1, 2018. We apply the five steps defined under ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We assess its revenue arrangements against specific criteria in order to determine if it is acting as principal or agent. Revenue arrangements with multiple performance obligations are divided into separate distinct goods or services. We allocate the transaction price to each performance obligation based on the relative standalone selling price of the goods or services provided. Revenue is recognized upon the transfer of control of promised goods or services to a customer. We do not make any significant judgment in evaluating when control is transferred. Revenue is recorded net of value-added tax. Revenue recognitions are as follows: Sales of juice and other products: We recognize revenue when the receipt of merchandise is confirmed by the customers, which is the point that the title of the goods is transferred to the customer. We recognize revenues when we satisfy a performance obligation by transferring a promised good or service (that is, an asset) to a customer. An asset is transferred when the customer obtains control of that asset. Customers have no contractual right to return products. Historically, the Company has not had any returned products. Accordingly, no provision has been made for returnable goods. The Company is not required to rebate or credit a portion of the original fee if it subsequently reduces the price of its product to its suppliers. The Company does not make any significant judgment in determination of the amount and timing of revenue from contracts with customers. On-line sales and Membership fee: The Company recognizes the sale of goods 15 days after the products are shipped (after the 15 days return policy). The revenue from the membership fee is amortized over the lifetime of the membership, which is one year. For the merchandise gift package, revenue is recognized when the receipt of the gift package is confirmed by the members. Other revenues include revenues earned on net basis from sales of certain products on our platform. Shipping and Handling Costs Shipping and handling amounts billed to customers in sales transactions are included in sales revenues and shipping expenses incurred by the Company are reported as a component of selling expenses. The shipping and handling expenses of $1,180 and $33,145 for fiscal years 2019 and 2018, respectively, are reported in the Consolidated Statements of Income and Comprehensive Income as a component of selling expenses. Advertising and Promotional Expense Advertising and promotional costs are expensed as incurred and are included in selling expenses. The Company incurred $19,128 and $19,341 in advertising and promotional costs for the years ended December 31, 2019 and 2018, respectively. Property, Plant and Equipment Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Depreciation is computed using the straight-line method over the useful lives of the assets. Major renewals and betterments are capitalized and depreciated; maintenance and repairs that do not extend the life of the respective assets are expensed as incurred. Upon disposal of assets, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in the consolidated statements of income and comprehensive income. Depreciation related to property, plant and equipment used in production is reported in cost of sales, and includes amortized amounts related to capital leases. We estimated that the residual value of the Company's property and equipment ranges from 3% to 5%. Property, plant and equipment are depreciated over their estimated useful lives as follows: Buildings 20-30 years Machinery and equipment 5-10 years Furniture and office equipment 3-5 years Motor vehicles 5 years Intangible Assets Acquired intangible assets are recognized based on their cost to the Company, which generally includes the transaction costs of the asset acquisition, and no gain or loss is recognized unless the fair value of noncash assets given as consideration differs from the assets' carrying amounts on the Company's book. These assets are amortized over their useful lives if the assets are deemed to have a finite life and they are reviewed for impairment by testing for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The fair value of an intangible asset is the amount that would be determined if the entity used the assumptions that market participants would use if they were pricing the intangible asset. The useful life of the Company's intangible assets is ten year, which is determined by using the time period that an intangible is estimated to contribute directly or indirectly to a company's future cash flows. Foreign Currency and Other Comprehensive Income (Loss) The financial statements of the Company's foreign subsidiaries are measured using the local currency as the functional currency; however, the reporting currency of the Company is the USD. Assets and liabilities of the Company's foreign subsidiaries have been translated into USD using the exchange rate at the balance sheet date, while equity accounts are translated using historical exchange rate. The exchange rate we used to convert RMB to USD was 6.98 and 6.86 at the balance sheet date of December 31, 2019 and December 31, 2018, respectively. The average exchange rate for the period has been used to translate revenues and expenses. The average exchange rate we used to convert RMB to USD was 6.90 and 6.62 for fiscal year 2019 and fiscal year 2018, respectively. Translation adjustments are reported separately and accumulated in a separate component of equity (cumulative translation adjustment). Other comprehensive loss for the year ended December 31, 2019 and 2018 represented foreign currency translation adjustments loss of $36.85 million and $85.18 million, respectively, and were included in the consolidated statements of comprehensive income (loss). Income Taxes We use the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, "Income Taxes." Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity's financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences 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 results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized. ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740-10-25 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have no material uncertain tax positions for any of the reporting periods presented. Right of Use Assets The Company paid in advance for land use rights according to Chinese law. Prepaid land use rights are being amortized and recorded as lease expenses using the straight-line method over the use terms of the lease, which are 40 to 50 years. Lease In February 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-02, Leases, and in July 2018, issued ASU No. 2018-10 and 2018-11 and in December 2018, issued ASU No. 2018-20 and in March 2019, issued ASU No. 2019-01, which amended the standard, replacing existing lease accounting guidance. The new standard introduced a lessee model that requires entities to recognize assets and liabilities for most leases, but recognize expenses on their income statements in a manner similar to current accounting. The ASU did not make fundamental changes to previous lessor accounting. For the Company, the ASU was effective January 1, 2019. As amended, the ASU provided for retrospective transition applied to earliest period presented or an adoption method by which entities would not need to recast the comparative periods presented. The Company did not recast prior periods as it adopted this ASU. As a result of adopting this ASU, the Company recorded approximately $0 of lease assets and lease liabilities related to transition upon this ASU's adoption. After adoption of ASU 2016-02 and related standards, operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For short-term leases with an initial lease term of 12 months or less and with purchase options we are reasonably certain will not be exercised. As a lessee, the Company leases equipment, land and office building. Lease expense is recognized on a straight-line basis over the lease term. Convertible notes The Company accounts for its convertible notes at issuance by allocating the proceeds received from a convertible note among freestanding instruments according to ASC 470, Debt, based upon their relative fair values. The fair value of debt and common stock is determined based on the closing price of the common stock on the date of the transaction. Convertible notes are subsequently carried at amortized cost. Each convertible note is analyzed for the existence of a beneficial conversion feature ("BCF"), defined as the fair value of the common stock at the commitment date for the convertible note, less the effective conversion price. No BCF was recognized for the convertible notes issued during 2019. Share-based compensation The Company awards share options and other equity-based instruments to its employees, directors and consultants (collectively "share-based payments"). Compensation cost related to such awards is measured based on the fair value of the instrument on the grant date. The Company recognizes the compensation cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The amount of cost recognized is adjusted to reflect the expected forfeiture prior to vesting. When no future services are required to be performed by the employee in exchange for an award of equity instruments, and if such award does not contain a performance or market condition, the cost of the award is expensed on the grant date. The Company recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date. New Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13 ("ASU 2016-13") "Financial Instruments - Credit Losses" ("ASC 326"): Measurement of Credit Losses on Financial Instruments" which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. In November 2019, the FASB issued ASU 2019-10 "Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842)" ("ASC 2019-10"), which defers the effective date of ASU 2016-13 to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, for public entities which meet the definition of a smaller reporting company. The Company will adopt ASU 2016-13 effective January 1, 2023. Management is currently evaluating the effect of the adoption of ASU 2016-13 on the consolidated financial statements. The effect will largely depend on the composition and credit quality of our investment portfolio and the economic conditions at the time of adoption. In December 2019, the FASB issued the amendments in ASU 2019-12 ASC Topic 740, Income Taxes: Simplifying Accounting for Income Taxes Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying consolidated financial statements. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | 3. INVENTORIES Inventories by major categories are summarized as follows: December 31, 2019 2018 Raw materials and packaging $ - $ 24,578 Finished goods 37,269 2,502,803 Less: impairment loss (33,675 ) (2,464,364 ) Inventories $ 3,594 $ 63,017 Inventory write-downs and write-offs made during years ended December 31, 2019 and 2018 were $27,247 and $2.46 million, respectively. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT AND EQUIPMENT | 4. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consist of the following: December 31, 2019 2018 Machinery and equipment $ $ 32,702,621 Furniture and office equipment 36,958 368,875 Motor vehicles - 355,820 Buildings - 54,689,750 Construction in progress - 185,646 Subtotal 36,958 88,302,711 Less: accumulated depreciation (11,902 ) (41,420,859 ) Less: Impairment loss (7,201 ) (44,545,816 ) Net property and equipment $ 17,855 $2,336,0 36 Depreciation expense |
Intangible Assets
Intangible Assets | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | 5. INTANGIBLE ASSETS On January 23, 2018, DigiPay and Peng Youwang ("Peng"), a Chinese citizen entered into the DCON Agreement. Under the terms of the DCON Agreement, Peng transferred to DigiPay a 60% ownership interest in certain digital assets of DCON, a blockchain platform for cryptocurrency conversion, payment and other services ("DCON"), including but not limited to its business plan and white papers, business models, software, architectures, codes, software, applications, technologies, patents, copyrights, trade secrets, customer lists, business points, trading platforms, digital rights, authentication systems, agreements and contracts, token, and the DCON communities established on Nova Realm City (the "Transfer Assets") for an aggregate purchase price of $9.6 million (the "Purchase Price"). As of December 31, 2018, management has determined that above acquired intangible assets were evaluated at the par value of the common stocks issued, or $1,200. We have assessed the recoverability of such assets as of December 31, 2019 and concluded that no impairment indication was noted. Also included in the intangible assets is land use right. The government of the PRC, its agencies and collectives hold all land ownership. Companies or individuals are authorized to use the land only through land usage rights granted by the PRC government. Land usage rights can be transferred upon approval by the land administrative authorities of the PRC (State Land Administration Bureau) upon payment of the required land transfer fee. Accordingly, the Company paid in advance for land usage rights. Prepaid land usage rights are being amortized and recorded as lease expenses using the straight-line method over the terms of the leases, which range from 40 to 50 years. The amortization expense was $0.12 million and $6.5 million and for fiscal years 2019 and 2018, respectively. The following table sets forth land usage rights of the Company as of December 31, 2019 and 2018, respectively. December 31, 2019 2018 Cost $ 5,847,008 $ 24,003,243 Less: Accumulated amortization (574,996 ) (2,556,898 ) Less: Impairment Loss - (6,895,078 ) $ 5,272,012 14,551,266 |
Related Party Transaction
Related Party Transaction | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTION | 6. RELATED PARTY TRANSACTION As of December 31, 2019, the amount due to the related parties was $1.27 million, which consisted of the followings: Name of Related Party from Whom Amounts were Received Amount Relationship Note Yongke Xue 28,539 Chairman of the Company Loan payable Shanchun Huang 71,672 Chief Executive Officer of the Company Loan payable Shenzhen TianShunDa Equity Investment Fund Management Co., Ltd., 573,142 Holds 26.36% of equity shares of SkyPeople China Interest free loan* InUnion Chain Ltd. ("INU") 209,957 The Company is the 10% equity shareholder of INU Accounts payables Zhi Yan 40,710 Chief Technology Officer of the Company Loan payable Jing chen 6,527 Chief Financial Officer of the Company Payable to employee Zeyao Xue 310,746 Son of the Chairman of the Company and a shareholder of the Company Chief Operating Officer of the Company Loan payable Kai Xu 26,808 Chief Operating Officer of the Company Payable to employee As of December 31, 2019, the amount due from the related parties was $3.40 million, which consisted of the followings: Name of Related Party to Whom Amount Relationship Note Shaanxi Chunlv Ecological Agriculture Co. Ltd. 3,356,070 Holds 20.0% interest in CCM logistics Interest free loan* Quangoutong Commercial Holdings (Xi'an) Co., Ltd ("Quangoutong") 22,935 Shaanxi Fullmart Convenient Chain Supermarket Co., Ltd. ("Fullmart") holds 16.67% equity of its subsidiary. The subsidiary is 83.33% owned by Quangoutong Service fee due Shaanxi Quangou Convenient Island Co. Ltd. 23,828 Fullmart holds 33.33% its equity Interest free loan* ● The interest free loans have been approved by the Company's Audit Committee. In fiscal year 2019, the Company purchased health insurance of $209,958 from InUnion Chain Ltd ("INU"), and the Company is the 10% equity shareholder of INU. The Company's subsidiary sold fruit beverages to a related entity, Shaanxi Fullmart Convenient Chain Supermarket Co., Ltd. ("Fullmart") for approximately $8,810 for the year ended December 31, 2018. The sales to this related party were consistent with pricing and terms offered to third parties. The remaining accounts receivable balances were $0 as of 2018. Fullmart is a company indirectly owned by our Chairman and CEO, Mr. Yongke Xue. |
Income Tax
Income Tax | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
INCOME TAX | 7. INCOME TAX The Company is incorporated in the United States of America and is subject to United States federal taxation. No provisions for income taxes have been made, as the Company had no U.S. taxable income for the years ended December 31, 2019 and 2018. The effective income tax rate for the Company for both of the years ended December 31, 2019 and 2018 were 0% and 0% respectively. Some of our subsidiaries generated income and we accrued income tax according to the Chinese corporate income tax rate, but some had a loss and no tax provision was made. The amount of unrecognized deferred tax liabilities for temporary differences related to the dividend from foreign subsidiaries is not determined because such determination is not practical. The Company has not provided deferred taxes on undistributed earnings attributable to its PRC subsidiaries as they are to be permanently reinvested. On February 22, 2008, MOFCOM and SAT jointly issued Cai Shui 2008 Circular 1, "Circular 1." According to Article 4 of Circular 1, distributions of accumulated profits earned by foreign investment enterprises, ("FIE") prior to January 1, 2008 to their foreign investors will be exempt from withholding tax, ("WHT") while distribution of the profits earned by a FIE after January 1, 2008 to its foreign investors shall be subject to WHT. The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the provisions of ASC Topic 740, Income Taxes Effective on January 1, 2008, the PRC Enterprise Income Tax Law, EIT Law, and Implementing Rules imposed a unified enterprise income tax rate of 25% on all domestic-invested enterprises and foreign-invested enterprises in the PRC, unless they qualify under certain limited exceptions. All of the Companies' Chinese subsidiaries were subject to an enterprise income tax rate of 25%. In assessing the reliability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible or are utilized. Based upon an assessment of the level of historical taxable income and projections for future taxable income over the periods on which the deferred tax assets are deductible or can be utilized, management believes it is not likely for the Company to realize all benefits of the deferred tax assets as of December 31, 2019 and December 31, 2018. Therefore, the Company provided for a valuation allowance against its deferred tax assets as of December 31, 2019 and 2018, respectively. |
Impairment Loss
Impairment Loss | 12 Months Ended |
Dec. 31, 2019 | |
Entry into a Material Definitive Agreement [Abstract] | |
IMPAIRMENT LOSS | 8. IMPAIRMENT LOSS The Company recorded $2.75 million of impairment loss in fiscal year 2019 related with the INU Digital Assets Token and 10% equity investment in InUnion Chain Limited that Digipay Finteh Limited invested in June 2018. The Company recognized an impairment loss of $4.36 million in fiscal year 2018 related with the fixed assets of the Company's subsidiary Yingkou, which had no production since the year 2016. In 2018, the Company recorded an impairment loss of $25.19 million regarding Company's fixed assets and construction in progress. Among this amount, $11.51 million was related with Shaanxi Guoweimei Kiwi Deep Processing Co., Ltd. ("Guo Wei Mei"). On April 19, 2013, we established Guo Wei Mei to engage in the business of producing kiwi fruit juice, kiwi puree, cider beverages, and related products. The total estimated investment was RMB 294 million. By the end of 2018, the Company has finished the building of an R&D center and an office building with a total investment of approximately $11.24 million (RMB 76.2 million), the Company has also purchased a fruit juice production line of approximately $19.02 million (RMB 129 million). As the Chinese government recently tightened environmental regulations, the project has been delayed and the construction has been stopped since early 2017. Since the Company's current cash cannot support the future input of this project and there is no forecasted cash flow from this project, the value of the construction in progress of this project was impaired. An impairment loss of $25.68 million recorded in 2018 was related with our Suizhong project in Liaoning Province, which was to establish a fruit and vegetable industry chain and further processing demonstration zone in Suizhong County, Liaoning Province (the "Suizhong Project"). We started the Suizhong project in August 2013. The Company has made partial payment to acquire land use rights from the local government, purchase equipment and build facilities. By the end of 2018, the Company has finished construction of an office building, dormitory, refrigeration storage facility and warehouse. However, due to heavy competition in the concentrated apple juice business in China, our Huludao Wonder and Yingkou facilities in Liaoning have had no production in the past few years, and the construction work on Suizhong project is also currently suspended. Since the Company's current cash cannot support the future input of this project and there is no forecasted cash flow from this project, the value of the construction in progress of this project was impaired. An impairment loss of $32.68 million recorded in 2018 was related with our Yidu project. On November 23, 2015, the Company started the construction of the Yidu project, which was to establish the distribution center and the deep processing zone on the project land of approximately 280 mu, or 46 acre. As the Chinese government recently tightened environment regulations, the project has been delayed. Since the Company's current cash cannot support the future input of this project and there is no forecasted cash flow from this project, the value of the construction in progress of this project was impaired. |
Risks and Uncertainties
Risks and Uncertainties | 12 Months Ended |
Dec. 31, 2019 | |
Risks and Uncertainties [Abstract] | |
RISKS AND UNCERTAINTIES | 9. RISKS AND UNCERTAINTIES a) PRC Regulations 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. We are considered foreign persons or foreign funded enterprises under PRC laws and, as a result, we are required to comply with PRC laws and regulations related to foreign persons and foreign funded enterprises. These 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 of newly enacted laws, regulations or amendments may be delayed, resulting in detrimental reliance. 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. b) Major customers and suppliers No customer accounted for more than 10% of the Company's sales for the year ended December 31, 2019. There were two customers, Chengdu Hongkor Electromechanical Equipment Co., Ltd. ("HongKor"), and Qifeng Fruit Industry Co., Ltd., who accounted for 40.96% and 10.17% respectively of the Company's sales for the year ended December 31, 2018, Sales to our five largest customers accounted for approximately 15.6% and 61.56% of our net sales during the years ended December 31, 2019 and 2018, respectively. There was no suppliers accounted for more than 10% of our purchase during the year ended December 31, 2019. Five top suppliers accounted for 14.42% of our purchases during the year ended December 31, 2019. In 2018, the company's suppliers were dispersed, no one occupied more than 1% of the total purchases. The first two largest suppliers were 0.99% during the year ended December 31, 2018. |
Share Based Compensation
Share Based Compensation | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
SHARE BASED COMPENSATION | 10. SHARE BASED COMPENSATION The Company's 2015 Omnibus Equity Plan permits the grant of incentive stock options ("ISOs"), nonqualified stock options ("NQSOs"), stock appreciation rights ("SARs"), restricted stock, unrestricted stock and restricted stock units ("RSUs") to its employees of up to 250,000 shares of Common Stock. As of December 31, 2019, there were no shares of stock available for award under the 2015 Stock Incentive Plan. On March 13, 2018, the Company's shareholders approved the 2017 Omnibus Equity Plan at the annual shareholders meeting, which permits the grant of incentive stock options ("ISOs"), nonqualified stock options ("NQSOs"), stock appreciation rights ("SARs"), restricted stock, unrestricted stock and restricted stock units ("RSUs") to its employees of up to 1,300,000 shares of Common Stock. On December 21, 2018, the Company approved the issuance of 1,300,000 shares of the Company's unrestricted common stock to seven of the Company's employees pursuant to our 2017 Omnibus Equity Plan. The Company recorded an expense of $13,000 in the fourth quarter of fiscal year 2018 under the 2017 Omnibus Equity Plan, reflecting a par value of $0.001 per share of the Company's common stock. The shares were issued accordingly to these employees in May and June of 2019. The Company did not grant any stock options during the fiscal year 2019. |
Common Stocks Issued in Connect
Common Stocks Issued in Connection with the Convertible Notes | 12 Months Ended |
Dec. 31, 2019 | |
Common Stocks Issued in Connection with the Convertible Notes [Abstract] | |
COMMON STOCKS ISSUED IN CONNECTION WITH THE CONVERTIBLE NOTES | 11. COMMON STOCKS ISSUED IN CONNECTION WITH THE CONVERTIBLE NOTES Common stocks issued in connection with the convertible notes From October to December 2019, the Company issued 1,493,333 shares of its common stock to Iliad Research and Trading, L.P., a Utah limited partnership (the "Purchaser") pursuant to a series of Exchange Agreements entered into with the Purchaser. On March 26, 2019, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement") with the Purchaser pursuant to which the Company sold and issued to the Purchaser a Secured Convertible Promissory Note (the "Note") in the principal amount of $1,070,000. The Purchaser purchased the Note with an original issue discount of $50,000, and the Company agreed to pay to the Purchaser $20,000 for fees and costs incurred by Purchaser in connection with the consummation of the Purchase Agreement. The Note was sold to the Purchaser pursuant to an exemption from registration under Regulation D, promulgated under the Securities Act of 1933, as amended. The purchase price for the Note was paid by the Purchaser through an initial cash payment of $500,000 and the issuance of an Investor note to the Company with a one-year term and an interest rate of 8% (the "Investor Note"), which the Purchaser agrees to prepay in full upon the satisfaction of certain conditions for pledged shares and transfer agent instruction letter pursuant to the Investor Note and Purchase Agreement. On May 2, 2019, the Company received a second cash payment from Purchaser of $0.5 million after satisfying certain conditions for pledged shares as required in the Securities Purchase Agreement, of which $3,818 was interest income for the Company due to late payment past the agreed date by the Purchaser. The Note bears interest at the rate of 8% per annum. All outstanding principal and accrued interest on the Note became due and payable on March 26, 2020. The Company's obligations under the Note may be prepaid at any time, if the company elects to prepay the Company would pay 125% of any amount outstanding under the Note. The Note may be converted at any time, at the Purchaser's option, into shares of the Company's common stock at a conversion price of $3.00 per share. During the term of the Note, the Company shall not, without the prior written consent of the Purchaser, enter into or effect certain fundamental business transactions. The Company has the option to redeem the Note at any time after the six month anniversary of the date when the purchase price is delivered to the Company. The Company's obligations under the Note are secured by a pledge of 2,500,000 shares of the Company's common stock by Mengyao Chan, an unrelated third party, in favor of the Purchaser. On October 15, 2019, the Company entered into an Exchange Agreement (the "First Exchange Agreement") with the Purchaser (the "Lender"). Pursuant to the First Exchange Agreement, the Company and Lender agreed to partition a new Promissory Note in the original principal amount of $100,000 (the "First Partitioned Note") from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the First Partitioned Note. The Company and Lender further agreed to exchange the First Partitioned Note for the delivery of 133,333 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the First Exchange Agreement. On October 17, 2019, the Company entered into a second Exchange Agreement (the "Second Exchange Agreement") with the Lender. Pursuant to the Second Exchange Agreement, the Company and Lender agreed to partition a new Promissory Note in the original principal amount of $300,000 (the "Second Partitioned Note") from the Note. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Second Partitioned Note. The Company and Lender further agreed to exchange the Second Partitioned Note for the delivery of 400,000 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Second Exchange Agreement. On October 23, 2019, the Company entered into a Forbearance Agreement with the Lender. Pursuant to the Forbearance Agreement, Lender agreed to withdraw a Redemption Notice delivered by the Lender to the Company on September 30, 2019, which was issued pursuant to the Note issued by the Company to the Lender dated March 26, 2019. Lender agreed not to make any redemptions pursuant to the Note before October 25, 2019. The parties agreed, in the event Lender delivers a Redemption Notice to the Company and the redemption amount set forth therein is not paid in cash to Lender within three (3) trading days, then the applicable redemption amount shall be increased by 25% (the "First Adjustment," and such increase to the redemption amount, the "First Adjusted Redemption Amount"). In the event the First Adjusted Redemption Amount is not paid within three (3) trading days after the date of First Adjustment, then the First Adjusted Redemption Amount shall be increased in accordance with the following formula: $0.75 divided by the lowest closing trade price of the Common Stock of the Company during the twenty (20) trading days prior to the date of the Second Adjustment and the resulting quotient multiplied by the First Adjusted Redemption Amount (the "Second Adjustment," and such increase to the First Adjusted Redemption Amount, the "Second Adjusted Redemption Amount"), provided, however, that such formula shall only be applied if the resulting quotient is greater than one (1) and such formula shall in no event be used to reduce the First Adjusted Redemption Amount. Upon payment in cash of the First Adjusted Redemption Amount or Second Adjusted Redemption Amount, the outstanding balance of the Note will be reduced by the original amount set forth in the Redemption Notice. The Company also agreed that during each calendar month, beginning in the month of October 2019, it will reduce the outstanding balance of the Note by at least $100,000 and if the outstanding balance is reduced by more than $100,000 in a given month, then the portion of the balance reduction amount that exceeds $100,000 may be counted toward the minimum balance reduction requirement in the next month or months. On November 6, 2019, the Lender issued a Redemption Notice, and the premium was agreed to be increased by $172,583. On November 26, 2019, the Lender issued another Redemption Notice, and the premium was agreed to be increased by $170,407. On January 21, 2020, the Lender issued another Redemption Notice, and the premium was agreed to be increased by $173,276. On October 25, 2019, the Company entered into the third Exchange Agreement (the "Third Exchange Agreement") with the Lender. Pursuant to the Third Exchange Agreement, the Company and Lender agreed to partition a new Promissory Note (the "Third Partitioned Note") in the original principal amount of $145,000 from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Third Partitioned Note. The Company and Lender further agreed to exchange the Third Partitioned Note for the delivery of 193,333 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Third Exchange Agreement. On November 1, 2019, the Company entered into the Fourth Exchange Agreement (the "Fourth Exchange Agreement") with the Lender. Pursuant to the Fourth Exchange Agreement, the Company and Lender agreed to partition a new Promissory Note (the "Fourth Partitioned Note") in the original principal amount of $175,000 from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Fourth Partitioned Note. The Company and Lender further agreed to exchange the Fourth Partitioned Note for the delivery of 233,333 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Fourth Exchange Agreement. On November 13, 2019, the Company, entered into the Fifth Exchange Agreement (the "Fifth Exchange Agreement") with the Lender. Pursuant to the Fifth Exchange Agreement, the Company and Lender agreed to partition a new Promissory Note (the "Fifth Partitioned Note") in the original principal amount of $125,000 from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Fifth Partitioned Note. The Company and Lender further agreed to exchange the Fifth Partitioned Note for the delivery of 166,667 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Fifth Exchange Agreement. On November 19, 2019, the Company, entered into the Six Exchange Agreement (the "Six Exchange Agreement") with the Lender. Pursuant to the Six Exchange Agreement, the Company and Lender agreed to partition a new Promissory Note in the original principal amount of $125,000 (the "Six Partitioned Note") from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Six Partitioned Note. The Company and Lender further agreed to exchange the Six Partitioned Note for the delivery of 166,667 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Six Exchange Agreement. On November 26, 2019, the Company entered into the Seventh Exchange Agreement (the "Seventh Exchange Agreement") with the Lender. Pursuant to the Seventh Exchange Agreement, the Company and Lender agreed to partition a new Promissory Note (the "Seventh Partitioned Note") in the original principal amount of $150,000 from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Seventh Partitioned Note. The Company and Lender further agreed to exchange the Seventh Partitioned Note for the delivery of 200,000 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Seventh Exchange Agreement. Acquisition of Creditor's Rights On November 2, 2017 (the "Agreement Date"), a wholly-owned indirect subsidiary of the Company, Hedetang Foods (China) Co., Ltd. ("Hedetang"), entered into a series of Creditor's Rights Transfer Agreements (collectively, the "Acquisition Agreements") with each of Shaanxi Chunlv Ecological Agriculture Co. Ltd., Shaanxi Boai Medical Technology Development Co., Ltd., and Shaanxi Fu Chen Venture Capital Management Co. Ltd. (collectively, the "Sellers"). The Sellers holds 70% of the equity shares of Shenzhen TianShunDa Equity Investment Fund Management Co., Ltd., which holds 26.36% of equity shares of SkyPeople China. Pursuant to the Acquisition Agreements, Hedetang agreed to purchase certain creditor's rights associated with companies located in the PRC, for an aggregate purchase price of RMB 181.01 million (approximately $27.34 million), of which RMB 108.60 million (approximately $16,44 million was paid in cash and RMB 72,40 million approximately $10.94 million was paid in shares of common stock of the Company based on the average of the closing prices of Future FinTech's common stock over the five trading days preceding the date of the Acquisition Agreements. A summary of the Acquisition Agreements is as follows: 1) Shaanxi Chunlv Ecological Agriculture Co. Ltd. agreed to transfer all of its credit rights of principal and interest owed by Xi'an Tongji Department Store Co., Ltd. to Hedetang. As of the Agreement Date, the book balance of the principal was RMB 23.63 million, the interest was RMB 38.28 million, and the total credit balance, including the principal and the interest, was RMB 61.91 million, of which the RMB 19.76 million credit was guaranteed by a third party company. 2) Shaanxi Chunlv Ecological Agriculture Co. Ltd. agreed to transfer all of its credit rights of principal and interest owed by Shaanxi Youyi Co., Ltd. to Hedetang. As of the Agreement Date, the book balance for the principal was RMB 45.35 million, the interest was RMB 71.22 million, and the total credit balance including the principal and the interest was RMB 116.57 million, all of which was guaranteed by a third party company. 3) Shaanxi Fu Chen Venture Capital Management Co., Ltd. agreed to transfer all of its credit rights of principal and interest owed by State Owned Shaanxi No. 8 Cotton and Textile Mill to Hedetang. As of the Agreement Date, the book balance for the principal was RMB 72.37 million the interest was RMB 138.04 million, the total of credit including the principal and the interest was RMB 210.41 million, and there was no effective guarantee or pledged assets to secure this debt. 4) Shaanxi Boai Medical Technology Development Co., Ltd. agreed to transfer all its credit rights of principal and interest owed by Xi'an Yanliang Economic Development Co., Ltd. to Hedetang. As of the Agreement Date, the book balance for the principal was RMB 6.35 million, the interest was RMB 9.83 million, and the total of credit including the principal and the interest was RMB 16.18 million, which is secured by certain land use rights. In connection with the Acquisition Agreements and to provide funding for their consummation, on November 3, 2017, the Company entered into a Share Purchase Agreement (the "Share Purchase Agreement") with Mr. Zeyao Xue ("Xue") pursuant to which Future FinTech agreed to sell 11,362,159 shares of its common stock (the "Shares") to Xue for an aggregate purchase price of $16.44 million. The per share price for the Shares was determined using the average closing price quoted on the NASDAQ Global Market for the common stock of the Company over the three (3) trading days prior to the date of the Share Purchase Agreement (the "Purchase Price"), subject to potential upward adjustment. The consummation of the Share Purchase Agreement was contingent on Future FinTech receiving shareholder approval at a Special Shareholders Meeting for an amendment to its articles of incorporation and the approval of Share issuance under the Share Purchase Agreement by the shareholders of the Company. On April 6, 2018, the Company issued an aggregate 7,111,599 shares of the Company's common stock to three individuals designated by the Sellers in the respective amounts of 3,409,466, 3,323,225 and 378,908 shares, pursuant to the Acquisition Agreements, and 11,362,159 shares of the Company's common stock pursuant to the Share Purchase Agreement, which such issuances were approved by the Company's shareholders at a special meeting held on March 13, 2018. Acquisition of DCON On January 23, 2018, DigiPay FinTech Limited ("DigiPay"), a limited liability company incorporated in the British Virgin Islands and a wholly-owned subsidiary of the Company, and Peng Youwang ("Peng"), a Chinese citizen, entered into a DCON Digital Assets Transfer Agreement (the "DCON Agreement"). Under the terms of the Agreement, Peng transferred to DigiPay a 60.00% ownership interest in certain digital assets of DCON, a blockchain platform for cryptocurrency conversion, payment and other services ("DCON"), including but not limited to its business plan and white papers, business models, software, codes, architectures, applications, technologies, patents, copyrights, trade secrets, customer lists, business points, trading platforms, digital rights, authentication systems, agreements and contracts, intellectual property, tokens, and the DCON communities established on Nova Realm City (the "Transfer Assets") for an aggregate purchase price of $9,600,000 (the "Purchase Price"). The Company paid the Purchase Price by issuing to Peng 1,200,000 shares of the Company's common stock, par value $0.001 per share (the "Common Stock"), equaling a per share sale price of $8.00 (the "Share Payment"). Half of the shares of Common Stock subject to the Share Payment were issued within 30 days of the date of the Agreement, and the remaining Share Payment shares were issued within 90 days of the date of the Agreement. On May 3, 2018, the Company issued the remaining 600,000 shares of its common stock to Mr. Peng and his designee according to the Agreement. The Agreement also contains customary representations and warranties regarding the Transfer Assets and the ownership thereof, and covenants regarding the parties' cooperation. DigiPay and Peng further agreed to establish a Japanese operating company for the Transfer Assets, of which DigiPay holds a 60.00% ownership interest and Peng's designee holds a 40.00% ownership interest. Reits Service Agreement On January 5, 2018, the Company issued 880,580 shares of its common stock to Reits (Beijing) Technology Co. Ltd., a limited liability company incorporated in China ("Reits") pursuant to the Technology Development Service Contract (the "Service Agreement") signed on December 18, 2017 by Reits and GlobalKey Supply Chain Ltd. ("GlobalKey"), a limited liability company incorporated in China and a wholly owned subsidiary of the Company. Under the Service Agreement, Reits shall provide services to GlobalKey relating to the design, development, testing, deployment and maintenance of a blockchain-based Globally Shared Shopping Mall and other software systems (the "System"). Following the completion and delivery of the System by Reits, (i) GlobalKey shall provide the hardware and network requirements for the trial deployment of the System, (ii) Reits shall provide training of GlobalKey's staff in the use and operation of the System, and (iii) for a period of one year from the System delivery date and for no additional charge, Reits shall provide ongoing System maintenance and technical support (the "Free Maintenance Period"). Following the completion of the Free Maintenance Period, GlobalKey may elect to engage Reits for ongoing maintenance and technical support. Under the Service Agreement, GlobalKey shall pay Reits aggregate consideration of RMB 13 million ($2.07 million), of which RMB 9.1 million ($1.45 million) may be paid in shares of the Company's common stock, par value $0.001 per share (the "Common Stock"), at a per share price equal to the average of the Common Stock's closing prices over the 5 trading days prior to the date of the Agreement, or $1.554 per share (the "Share Payment"). The exchange rate between US dollar and RMB for the payment is 1:6.65. The Share Payment was made within 15 business days of the date of the Service Agreement, and the remaining Service Agreement consideration shall be paid by GlobalKey in accordance with the schedule described in the Service Agreement. The Company paid RMB 0.88 million ($0.14 million) and RMB 0.79 million ($0.12 million) in cash to Reits in the first and second quarters of 2018, respectively. Exercise of warrants On January 5, 2018, the Company issued 30,000 shares of the Company's common stock to a certain warrant holder for the exercise of Warrants. Acquisition of long-term investments On October 19, 2018, the Company issued 5 million shares of its Common Stock to Mr. Chenliu pursuant to the InUnion Chain Ltd. Shares Transfer and IUN Digital Assets Investment Agreement entered into on June 22, 2018 between Digipay, Mr. Chenliu, an individual resident of Costa Rica, and InUnion Chain Ltd. ("InUnion"), a British Virgin Islands company wholly owned by Mr. Chenliu. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | 12. DISCONTINUED OPERATIONS HeDeTang HK On September 18, 2019, HeDeTang Holdings (HK) Ltd. ("HeDeTang HK") entered into a Share Transfer Agreement (the "Agreement") with New Continent International Co., Ltd., (the "Buyer") a company incorporated in the British Virgin Islands. Pursuant to the terms of the Agreement, the Buyer purchased 100% ownership of HeDeTang HK, which value is primarily derived from HeDeTang HK's wholly-owned subsidiary HeDeJiaChuan Holdings Co., Ltd. and 73.41% owned subsidiary SkyPeople Juice Group Co., Ltd., for a total price of RMB 600,000 (approximately $85,714) (the "Sale Transaction"). The Sale Transaction was closed on February 27, 2020. In accordance with ASC Topic 205, Presentation of Financial Statement Discontinued Operations Huludao Wonder The Company's Huludao Wonder operation, a subsidiary which produces concentrated apple juice, suffered continued operating losses since 2014 and its cash flow was minimal for these three years. In December 2016, the Company established a winding-down plan to close this operation. Based on the restructuring plan and in accordance with ASC 205-20, the Company presented the operating results from Huludao Wonder as a discontinued operation, as the Company believed that no continued cash flow would be generated by the disposed component (Huludao Wonder) and that the Company would have no significant continuing involvement in the operation of the discontinued component. Management of the Company initiated a plan to sell the property located in Huludao in December 2016, and ceased the depreciation of the property in accordance with ASC 205-20. In accordance with the restructuring plan, the Company intends to transfer the concentrated fruit juice production equipment in Huludao Wonder to another subsidiary and to sell the land and facilities upon favorable circumstances. In year 2016, Huludao Wonder stopped payment of interest on the loan it obtained from Suizhong Branch of Huludao Banking Co. Ltd. ("Suizhong Branch") in 2016. Suizhong Branch sued Huludao Wonder in the Intermediate People's Court (the "Huludao Court"), and as a result, in accordance with of the ruling of the Huludao court, the Company's fixed assets will offset long-term borrowings, along with its owed interest. Since the loan amount is larger than the remaining value of the fixed assets, the transaction became non-operating income for this subsidiary. Loss from discontinued operations for fiscal years 2019 and 2018 was as follows: December 31, December 31, 2019 2018 REVENUES $ 330,195 $ 756,838 COST OF SALES 315,737 891,154 GROSS PROFIT 14,459 (134,316 ) OPERATING EXPENSES: General and administrative 2,994,965 10,308,627 Selling expenses 172,449 174,097 Bad debt expenses 3,026,472 Impairment loss - 133,631,129 Total 6,193,885 144,113,852 OTHER INCOME (EXPENSE) Interest income 116 - Interest expense (7,300,070 ) (1,721,012 ) other income (expenses) 90,149 6,770,498 ) Total (7,209,805 ) (5,050,147 ) Loss from discontinued operations before income tax (13,389,231 ) (139,198,021 ) Income tax provision - 31 Loss from discontinued operation before Minority Interest $ (13,389,231 ) $ (139,198,052 ) Less: Net loss attributable to non-controlling interests (1,681,738 ) 15,618,798 LOSS FROM DISCONTINUED OPERATION $ (11,707,493 ) $ (123,579,254 The non-operating loss from discontinued operations was $11.71 million for fiscal year 2019 and $4.01 million for fiscal year 2018. The major components of assets and liabilities related to discontinued operations are summarized below: December 31, December 31, Cash $ 123,087 $ 220,342 Accounts receivable 11,720 73,244 Other receivables 1,861 15,381,465 Inventory 454,269 63,017 Advances to suppliers and other current assets 97,539 - Property and equipment, net 1,176,163 2,276,704 Right of use assets 57,571,254 Intangible assets, net 15,347,535 15,968,625 Amount due from related parties 17,989,358 Total assets related to discontinued operations $ 92,772,786 33,933,396 Accounts payable $ 2,084,735 $ 9,002,384 Accrued expenses 81,279,952 78,644,119 Advances from customers 815,382 772,078 Short-term bank loans 37,245,139 5,828,185 Lease liabilities 60,613,970 - Amount due from related parties 14,222,570 - Long-term loan 14,222,570 32,450,867 Total liabilities related to discontinued operations $ 196,261,748 $ 126,697,633 |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | 13. SEGMENT REPORTING In its operation of the business, management, including our chief operating decision maker, who is also our Chief Executive Officer, reviews certain financial information, including segmented internal profit and loss statements prepared on a basis not consistent with GAAP. The Company operates in four segments starting from fiscal 2019: shared shopping mall membership fee, fruit related products, sales of goods and others. Our concentrated juice and juice beverages are primarily produced by the Company's Jingyang factory. The operation of fruit related products is classified as discontinued operation as disclosed in Note 12. In compliance with the Company's business transformation strategy, membership fees from the shared shopping mall and sales of goods through the shared shopping mall platform started to generate the main revenues for the Company and became more and more important business sections of the Company since fiscal year 2019, while its traditional business section of seasonal fruit related products continued to shrink in fiscal year 2019. Some of our operation might not individually meet the quantitative thresholds for determining reportable segments and we determine the reportable segments based on the discrete financial information provided to the chief operating decision maker. The chief operating decision maker evaluates the results of each segment in assessing performance and allocating resources among the segments. Since there is an overlap of services provided and products manufactured between different subsidiaries of the Company, the Company does not allocate operating expenses and assets based on the product segments. Therefore, operating expenses and asset information by segment are not presented. Segment profit represents the gross profit of each reportable segment. For fiscal year 2019 (in thousands): CCM Shopping Sales of Goods Others Total Reportable segment revenue $ 542 $ 378 $ 412 $ 1,332 Inter-segment loss - - (377 ) (377 ) Revenue from external customers 542 378 35 955 Segment gross profit $ 401 $ 72 $ 18 $ 491 For fiscal year 2018 (in thousands): CCM Shopping Sales of Goods Others Total Reportable segment revenue $ - $ - $ 132 $ 132 Inter-segment loss - - - - Revenue from external customers - - 132 132 Segment gross profit $ - $ - $ 48 $ 48 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 14. COMMITMENTS AND CONTINGENCIES Litigation Legal case with Beijing Bank On June 29, 2015, SkyPeople China entered into a loan agreement with Beijing Bank. Pursuant to the loan agreement, SkyPeople China borrowed RMB 30 million (approximately $4.36 million) from Beijing Bank. Hongke Xue, Yongke Xue and Xiujun Wang provided guarantees for the loan and Shaanxi Boai Medical Technology Development Co., Ltd. ("Shaanxi Boai") provided certain real estate property as a pledge for the loan. SkyPeople China did not repay the loan on time and Beijing Bank filed an enforcement request with Xi'an Intermediate People's Court in June 2017. The Xi'an Intermediate People's Court seized real estate properties pledged by Shaanxi Boai and Xiujun Wang. In November 2018, the Court sold the real estate property pledged by Xiujun Wang for RMB 1.17 million. Because the real estate property is Xiujun Wang's primary home, the Court allocated RMB 0.12 million to Xiujun Wang as transition home leasing fee and deducted outstanding mortgage payments, and the remaining amount was delivered to Beijing Bank as the repayment. The Court has also made inquiries to Beijing Bank as to whether it is willing to accept the pledged real estate property of Shaanxi Boai as the repayment of the outstanding loan for the amount of RMB 27.93 million but Beijing Bank has refused to take the real property as repayment of the loan and the enforcement action has been terminated by the Court on December 18, 2018. As of December 31, 2019, SkyPeople China still owe the unpaid amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020 Legal case with Ningxia Bank On March 8, 2016, SkyPeople China entered into a loan agreement with Ningxia Bank. Pursuant to the loan agreement, SkyPeople China borrowed RMB 25 million (approximately $3.63 million) from Ningxia Bank. Hongke Xue, Yongke Xue, Lake Chen, Shaanxi Boai Medical Technology Development Co., Ltd. and Shaanxi Qiyiwangguo provided guarantees for the loan. SkyPeople China also pledged 37 pieces of equipment and the related trademarks to Ningxia Bank for the loan. SkyPeople China has not repaid the loan and Ningxia Bank filed an enforcement action with Xi'an Intermediate people's court in August 2017. The Court has frozen the assets of SkyPeople China that were pledged as guarantee for the loan from being transferred to any third-party, but the freeze does not limit or affect the use of these properties by SkyPeople China for its business. In July 2018, Shaanxi Qiyiwangguo filed a petition to the Court and requested the termination of the enforcement action on the basis that its guarantee of the loan was not valid because the seal used on the guarantee agreement was not authentic and the guarantee was not approved by the shareholders of Shaanxi Qiyiwangguo. On November 27, 2018 Shaanxi Qiyiwangguo withdrew its petition and the Court agreed to such withdrawal and there has been no other progress of this case. As of December 31, 2019, SkyPeople China still owe the unpaid amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with China Construction Bank On December 23, 2015, SkyPeople China entered into two loan agreements with China Construction Bank. Pursuant to the loan agreements, SkyPeople China borrowed RMB 13.90 million (approximately $2.13 million), and RMB 30 million (approximately $4.59 million) from China Construction Bank, respectively. Shaanxi Boai Medical Technology Development Co., Ltd. ("Boai"), Hongke Xue, Yongke Xue, Xiujun Wang and Yingkou Trusty Fruits Co., Ltd. ("Yingkou") provided pledges for the loans. SkyPeople China has not repaid the loans and China Construction Bank filed an enforcement action with Xi'an Intermediate People's Court in March 2017. In December 2017, SkyPeople China received the enforcement notice from the Court. The Court has seized certain parking space and land use rights pledged by Xiujun Wang and Boai and sold the land use right pledged by Boai in auction for approximately RMB 24,835,790 as repayment to China Construction Bank. The Court also seized certain land use rights pledged by Yingkou Trusty Fruits Co., Ltd., but the auction sale for those rights was not successful. As of December 31, 2019, SkyPeople China still owe the unpaid amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. On May 9, 2016, SkyPeople China entered into loan agreements with China Construction Bank. Pursuant to the loan agreements, SkyPeople China borrowed RMB 22.9 million (approximately $3.50 million) from China Construction Bank. Shaanxi Province Credit Reassurance Company ("Credit Reassurance Company") provided a guarantee to China Construction Bank for the loan, Hongke Xue and Yongke Xue provided their guarantees, and SkyPeople China provided an office space that it owned to Credit Reassurance Company as a pledge. SkyPeople China has not repaid the loan and Credit Reassurance Company repaid the loan for SkyPeople China. In June 2017, Credit Reassurance filed an enforcement action request with Xi'an Intermediate People's Court (the "Court") in June 2017. In December 2017, SkyPeople China received the enforcement notice from the Court. The Court issued a verdict to seize the office space of SkyPeople China for auction sale on December 26, 2017. In February 2018, the auction sale was conducted but not successful. In June 2018, the Court decided to use the pledge property as the repayment for the outstanding loan of RMB 12.21 million (approximately $1.78 million). The Company has transferred the ownership of the pledge property to China Construction Bank and the assets were wrote off. Legal case with China Cinda Asset Management Co., Ltd In April 2015, China Cinda Asset Management Co., Ltd. Shaanxi Branch ("Cinda Shaanxi Branch") filed two enforcement proceedings with Xi'an Intermediate People's Court (the "Court") against SkyPeople China for alleged defaults pursuant to guarantees by the SkyPeople China to its suppliers for a total amount of RMB 39.60 million or approximately $5.80 million. In September 2014, two long term suppliers of pear, mulberry, and kiwi fruits to the SkyPeople China requested that the Company provide guarantees for their loans with Cinda Shaanxi Branch. Considering the long term business relationship and to ensure the timely supply of raw materials, the SkyPeople China agreed to provide guarantees on the value of the raw materials supplied to the SkyPeople China. Because Cinda Shaanxi Branch is not a bank authorized to provide loans, it eventually provided financing to the two suppliers through the purchase of accounts receivables of the two suppliers with the SkyPeople China. In July 2014, the parties entered into two agreements – an Accounts Receivables Purchase and Debt Restructure Agreement, and Guarantee Agreements for Accounts Receivables Purchase and Debt Restructure. Pursuant to the agreements, Cinda Shaanxi Branch agreed to provide a RMB 100 million credit line on a rolling basis to the two suppliers and the Company agreed to pay its accounts payables to the two suppliers directly to Cinda Shaanxi Branch and provided guarantees for the two suppliers. In April 2015, Cinda Shaanxi Branch stopped providing financing to the two suppliers and the two suppliers were unable to continue the supply of raw materials to the SkyPeople China. Consequently, the SkyPeople China stopped making any payment to Cinda Shaanxi Branch. The SkyPeople China has responded to the Court and taken the position that the financings under the agreements are essentially the loans from Cinda Shaanxi Branch to the two suppliers, and because Cinda Shaanxi Branch does not have permits to make loans in China, the agreements are invalid, void and had no legal effect from the beginning. Therefore, SkyPeople China has no obligation to repay the debts owed by the two suppliers to Cinda Shaanxi Branch. Upon the Court's suggestion, the parties agreed to a settlement discussion in April 2017. As a part of the settlement discussion, on April 18, 2017, SkyPeople China withdrew its non-enforcement request from the Court without prejudice. As SkyPeople China may is liable for this loan, SkyPeople China recorded expenses of $5.80 million in the third quarter of 2018 as the result of these two enforcement proceedings. As of December 31, 2019, SkyPeople China still have liability of $5.80 million related with these two enforcement proceedings. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with Cinda Capital Financing Co. Ltd In August 2017, Cinda Capital Financing Co. Ltd. ("Cinda") filed a lawsuit with Beijing 2nd Intermediate People's Court (the "Beijing Intermediate Court") against the Company's indirectly wholly-owned subsidiaries Shaanxi Guoweimei Kiwi Deep Processing Company, Ltd. ("Guoweimei") and Hedetang Farm Products Trading Market (Mei County) Co., Ltd. ("Trading Market Mei County Co", and together with Guoweimei, "Lessees") requested that Lessees repay RMB 50 million (approximately $7.27 million) in capital lease fees, plus interest. Cinda has purchased or paid for refrigerant warehouse and trading hall to the suppliers and vendors and agreed to lease them to the Lessees for a leasing fee of RMB 50 million in December 2016. The capital leasing fee became due on its maturity date of June 2017, with certain land use rights of Lessees in Mei County and equity of Guoweimei as a pledge. The Company has disputed that the land use rights for the refrigerant warehouse and trading hall were never sold to or transferred to Cinda, therefore it is loan agreement and not capital lease agreement among the parties. Lessees have taken the position that Cinda is not a bank and does not have government permits required to make loans in China, and the agreements including pledge agreement were invalid, void and without legal effect from the beginning. Therefore, the lessees only has the obligations to repay principal but not the interest. In November 2017, Beijing Intermediate Court ruled in favor of Cinda and the Lessees appealed the case to the Beijing Supreme Court. The Beijing Supreme Court held a hearing at the end of July 2018. On December 4, 2018, the Beijing Supreme Court upheld the lower court's decision. On April 8, 2019, Beijing Intermediate Court issued the verdict for enforcement of the judgment and the plaintiff has the priority rights for the repayment for the pledged land use rights of Lessees in Mei County and equity of Guoweimei. The case is under enforcement procedure and Cinda is in the process of sale the land use rights. Before the land use right is sold, the subsidiaries of SkyPeople China still owns the seized properties and the liabilities to Cinda. As of December 31, 2019, SkyPeople China has not repaid the amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. In August 2017, Cinda filed another lawsuit with Beijing Intermediate Court against the Company's indirectly wholly-owned subsidiaries Guoweimei and SkyPeople China for repayment of leasing fee of RMB 84.97 million (approximately $12.35 million) plus interest. In January 2014, Guoweimei and SkyPeople China (the "Equipment Lessees") signed an Equipment Financial Lease Purchase Agreement with Cinda and an equipment supplier pursuant to which Cinda would provide funds to purchase equipment and the Equipment Lessees would lease the equipment from Cinda. Guoweimei pledged certain land use rights in Mei County to Cinda and Xi'an Hedetang and Hedetang Holding pledged their equities in Guoweimei to Cinda to secure the repayment. Mr. Hongke Xue also provided a personal guarantee for the payment of the leasing fee. Beijing Intermediate Court had two hearings of the case and on March 21, 2018 it ruled in favor of Cinda to the effect that SkyPeople China and Guoweimei shall pay leasing fees due in the amount of RMB 21.00 million (approximately $3.05 million), as well as leasing fees not yet due in the amount of RMB 63.98 million (approximately $9.30 million), plus attorney's fees and expenses. Beijing Intermediate Court also ruled that Mr. Hongke Xue is jointly liable for the debt as the guarantor, and that Cinda has priority rights to the pledged land use rights in Mei County and the pledged equities of Guoweimei as well as the ownership of the leasing properties until the leasing fees are paid. SkyPeople China appealed the decision to the Beijing Supreme Court. The Beijing Supreme Court rejected the appeal and upheld the original verdict on September 7, 2018. The case is under enforcement procedure and Cinda is in the process of sale the seized properties. Before they are sold, the subsidiaries of SkyPeople China still owns the seized properties and the liabilities to Cinda. As of December 31, 2019, SkyPeople China has not repaid the amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020 Legal case with Shaanxi Fangtian Decoration Co. Ltd In April 2015, SkyPeople China entered into a loan agreement with ("Fangtian"). Pursuant to the loan agreement, SkyPeople China borrowed RMB 3.50 million (approximately $0.51 million) from Fangtian. SkyPeople China has not repaid the loan and Fangtian filed a lawsuit with Xi'an Yanta District People's Court ("Yanta District Court"). On August 10, 2017, Yanta District Court ruled against SkyPeople China and determined that SkyPeople China must repay the loan of RMB 3.50 million plus interest RMB of 0.40 million (approximately $0.59 million) Fangtian has requested that the Yanta District Court enter into enforcement procedures for the case. As of December 31, 2019, SkyPeople China has not repaid the amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with Shanghai Pudong Development Bank On May 4, 2015, SkyPeople China and Xi'an Branch of Shanghai Pudong Development Bank (SPD Bank Xi'an Branch) renewed a Working Capital Loan Contract and Repayment Schedule, according to which both parties agreed that SPD Bank Xi'an Branch loaned RMB 26.90 million (approximately $3.92 million) to SkyPeople China with a term of one year. On the signing date of the Loan Contract, Hongke Xue, Yongke Xue, Xiujun Wang and SPD Bank Xi'an Branch signed a Contract of Guaranty, guaranteeing the repayment of loan and undertaking joint liability. According to a Mortgage Contract of Maximum Amount signed between SkyPeople China and SPD Bank Xi'an Branch on April 2, 2013, SkyPeople China provided the property and land use rights of Jingyang factory as the pledge. In October 2015, SPD Bank Xi'an Branch filed an enforcement request with the Intermediate Court of Xi'an and the Court seized the property and the land use rights of Jingyang factory. During the enforcement procedure, SPD Bank Xi'an Branch transferred its creditor's rights to China Huarong Asset Management Co., Ltd. ("China Huarong"). The Court changed the execution applicant to China Huarong. In March 2019, the Intermediate Court of Xi'an issued a verdict for the transfer of the pledged property and land use rights of Jingyang factory to China Huarong as the repayment of the loan. Legal case with Shaanxi Fangyuan Construction Co., Ltd. Shaanxi Guoweimei Kiwi Deep Processing Co. Ltd ("Guoweimei"), entered into a construction agreement with Shaanxi Fangyuan construction co., Ltd. ("Fangyuan") in July 2013. On October 8, 2018, Fangyuan filed a lawsuit and requested that Guoweimei pay a project construction fee plus penalty of RMB 56.32 million (approximately $8.22 million). On June 10, 2019, Baoji Intermediate People's Court issued a verdict that Guoweimei just pay RMB 41.58 million (approximately $6.07 million) plus penalty to Fangyuan, and Fangyuan will enjoy preferential right for the projects in processing zone of National Wholesale and Trading Center in Mei County for Kiwi Fruits developed by Guoweimei. Currently the Company is still liable for the unpaid amount and the interest. As of December 31, 2019, Guoweimei has not repaid the amount. Guoweimei was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with Shaanxi Zhongkun Construction Co., Ltd. In May 2015, Hedetang Farm Products Trading Markets (Mei County) Co., Ltd. ("Hedetang") and Shaanxi Zhongkun Construction Co., Ltd. ("Zhongkun") entered into a construction and decoration agreement. On September 5, 2018, Zhongkun filed the lawsuit with Mei County People's Court (the "Court") for repayment of construction and decoration fees. The Court issued a civil judgement in November 2018, ordering Hedetang to pay project funds of RMB 1.65 million (approximately $0.24 million) to Zhongkun, plus interest. On April 19, 2020, the Court issued a verdict to terminate the enforcement because assets of Hedetang had already been seized by Xi'an Yanta District People's Court and Baoji Intermediate People's Court, and there were no other assets for enforcement. Currently the Company is still liable for the unpaid amount and the interest. Legal case with Xi'an Shanmei Food Co. Ltd. On October 31, 2017, Xi'an Shanmei Food Co. Ltd. filed a lawsuit against Shaanxi Qiyiwangguo, a majority-owned subsidiary of the Company, with Zhouzhi County People's Court in connection with a Land Lease Agreement entered into by the parties on October 1, 2013. On March 2, 2018, Zhouzhi County People's Court issued a verdict that: (i) the Land Lease Agreement was thereby terminated; (ii) Shaanxi Qiyiwangguo shall pay Xi'an Shanmei the outstanding leasing fee RMB 0.21 million (approximately $0.03 million) and (iii) Shaanxi Qiyiwangguo shall return the 29.30 mu industrial use land to Xi'an Shanmei. Shaanxi Qiyiwangguo appealed the decision to the Xi'an Intermediate People's Court on the basis that: (x) the land use right was a capital contribution by Xi'an Shanmei for a shareholder of Shaanxi Qiyiwangguo who is also the sole shareholder of Xi'an Shanmei and the Land Lease Agreement was invalid and has no legal effect; (y) Zhouzhi Court did not schedule the hearing for the count claims filed by Shaanxi Qiyiwangguo; and (z) Zhouzhi Court violated certain civil procedures during the trial of the case. Due to the late notice to Zhouzhi Court, the case file was not timely transferred to Xi'an Intermediate Court and no appeal hearing was scheduled. Zhouzhi Court has issued verdict for enforcement procedure and Qiyiwangguo has filed petition of disagreement for the enforcement which is still under Zhouzhi Court's review. On January 23, 2019, the Court rejected the petition of disagreement and the case has been under enforcement procedure. As of December 31, 2019, Shaanxi Qiyiwanggu has not repaid the amount. Shaanxi Qiyiwanggu was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with Nanjing Bailuotong Logistics Services Co., Ltd. In January 2016 Shaanxi Qiyiwangguo Modern Organic Agriculture Co., Ltd ("Shaanxi Qiyiwangguo") and Nanjing Bailuotong Logistics Services Co., Ltd ("Bailutong") entered into a transportation agreement to ship fruit juices. Bailutong failed to deliver the juice products and held them after their expiration date. Shaanxi Qiyiwangguo filed a lawsuit against Bailutong with Zhouzhi county People's Court, and the Court issue the verdict in February 2018 that: (1) the transportation contract between Shaanxi Qiyiwangguo and Bailutong was terminated; and (2) Bailutong owed RMB 0.20 million (approximately $0.03 million) to Qiyiwangguo for the loss of Shaanxi Qiyiwangguo. Bailutong appealed the case to Xi'an Intermediate People's Court. Xi'an Intermediate People's Court rejected the appeal and upheld the original verdict. Legal case with Henan Huaxing Glass Co., Ltd. Qiyiwangguo entered into an agreement with Henan Huaxing Glass Co., Ltd. ("Huaxing") in May 2014 for Huaxing to supply glass bottles to Qiyiwangguo. However, due to the disputes regarding the quality of products supplied by Huaxing, Qiyiwangguo did not pay the prices for certain glass bottles. In August 2017, Huaxing filed a lawsuit and the court ruled Shaanxi Qiyiwangguo was required to pay Huaxing RMB 203,742 (approximately $29,743) in July 2018. During the enforcement process, the parties reached a settlement agreement but Shaanxi Qiyiwangguo failed to pay the amount due and now the case is still in the court enforcement process. As of December 31, 2019, Shaanxi Qiyiwanggu has not repaid the amount. Shaanxi Qiyiwanggu was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with Huludao Banking Co. Ltd. In September 2016, the Suizhong Branch of Huludao Banking Co. Ltd. ("Suizhong Branch") filed a lawsuit with Huludao Intermediate People's Court (the "Huludao Court") against the Company's indirectly wholly-owned subsidiary Huludao Wonder Fruit Co., Ltd. ("Wonder Fruit") and requested that Wonder Fruit repay a RMB 40 million (approximately $5.81 million) bank loan, plus interest. The loan became due on its maturity date of December 9, 2016. On December 19, 2016, the Huludao Court accepted the case. The Company has been disputing the interest rate of the loan with Suizhong Branch, and has not repaid the loan to date. Wonder Fruit believes that the interest charged by Suizhong Branch is 100.00% higher than the base rate set by People's Bank of China and is not consistent with the China People's Bank's base interest and floating rate. The Huludao Court has seized land use rights, buildings and equipment of Wonder Fruit that were pledged as guarantee for the loan and organized two auction sales for these assets in January and February of 2018, but both auction sales were unsuccessful in finding a buyer. On July 19, 2018, the Court issued a verdict ordering Huludao Wonder to transfer its land use rights, building, equipment, electronic and transportation assets to Zuizhong Branch as payment of the outstanding principal, auction and evaluation fees and some interest of the loan for RMB 42.64 million (approximately $6.22 million). As of December 31, 2019, there was RMB 11.95 million (approximately $1.74 million) in interest on the loan unpaid. Huludao Wonder was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with Andrew Chien In September 2017, Andrew Chien, a former consultant of SkyPeople China, brought a lawsuit against the Company and Mr. Hongke Xue in the District Court of Connecticut (the "Court"). The complaint was not properly served and the Company learned of the litigation in December 2017. In the complaint, Mr. Chien made several claims, most of which attempt to hold the Company liable under novel legal theories that relate back to an alleged breach of a consulting agreement between SkyPeople China and Chien from August 2006. Mr. Chien claimed approximately $257,000 damages and interest plus 2.00% of the Company's then-outstanding shares. Mr. Chien has as-yet unsuccessfully attempted to sue the Company on the breach of the same consulting agreement several times in the courts of Connecticut and New York, and these cases have been dismissed. The Company has filed a motion to dismiss ("MTD") and all proceedings are stayed pending determination of the MTD. On August 31, 2018, the Court granted our MTD. On September 10, 2018, Mr. Chien filed a motion for reconsideration. On September 28, 2018, the Court denied Mr. Chien's motion for reconsideration. On October 26, 2018, Mr. Chien appealed the case to the United States Court of Appeals for the Second Circuit. The appeal is fully briefed and presently awaiting decision. The Company will vigorously defend this lawsuit and expects to obtain early dismissal of Mr. Chien's claims. Legal case with Luwei In 2018, Mr. Luwei, an individual, filed a claim for arbitration against SkyPeople China in Xi'an Arbitration Commission for breach of contract pursuant to a new share purchase agreement and a share redemption agreement. On April, 11, 2019, Xi'an Arbitration Commission made its decision and ordered SkyPeople China to repay RMB 3 million investment to Luwei. Mr. Luwei applied with Intermediate Court of Xi'an (the "Court") for enforcement of the arbitration award which process was terminated by the Court due to no assets for enforcement. As of December 31, 2019, SkyPeople China has not repaid the amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with Shaanxi Overseas Investment Development Corp. In November, Shaanxi Overseas Investment Development Corp ("Shaanxi Overseas Investment") filed a lawsuit against SkyPeople China, Hongke Xue and Shenzhen Tian Shun Da Equity Investment Fund Management Co., Ltd. ("Shenzhen Tian Shun Da") pursuant to an investment agreement entered in March, 2016. According to the agreement, Shaanxi Overseas Investment agreed to invest RMB 5 million for the preferred shares of SkyPeople China with an annual interest rate of 2.38%. Shenzhen Tian Shun Da pledged 1.17% of the shares SkyPeople China that it owned and Hongke Xue provided guarantee for the performance of agreement by SkyPeople China. SkyPeople China failed to make the interests payment and Shaanxi Overseas Investment filed the lawsuit for breach of agreement. On December 26, 2019, Yanta District Court of Xi'an City (the "Court") ordered SkyPeople China to pay Shaanxi Overseas Investment the preferred share redemption amount of RMB 5 million plus penalty which is calculated based upon the RMB 5 million at a rate of 24% a year. The Court also ruled that Shaanxi Overseas Investment may sell the pledged shares owned by Shenzhen Tianshun Da as the repayment for SkyPeople China and Hongkong Xue shall also assume the repayment obligation as guarantor. As of December 31, 2019, SkyPeople China has not repaid the amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. Legal case with Shaanxi Wanyuan Construction Co., Ltd In July 2017, Shaanxi Wanyuan Construction Co., Ltd. ("Wanyuan") filed a lawsuit with Shaanxi Baoji Municipal Intermediate People's Court (the "Baoji Court") against Guoweimei for repayment of construction and decoration costs of RMB 55.07 million pursuant to a Construction and Decoration Agreement entered by the parties in May 2017. In July, 2019, the Baoji Court ordered Guoweimei to pay construction and decoration costs of RMB 55.07 million (approximately $7.98 million) to Wanyuan, plus interest. As of December 31, 2019, Guoweimei has not repaid the amount. Guoweimei was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2019 | |
Entry into a Material Definitive Agreement [Abstract] | |
VARIABLE INTEREST ENTITIES | 15. VARIABLE INTEREST ENTITIES On July 31, 2019, CCM Tianjin, E-commerce Tianjin, and Mr. Zeyao Xue and Mr. Kai Xu, citizens of China and shareholders of E-commerce Tianjin, entered into the following agreements, or collectively, the "Variable Interest Entity Agreements" or "VIE Agreements," pursuant to which CCM Tianjin has contractual rights to control and operate the business of E-commerce Tianjin (the "VIE"). Therefore, pursuant to ASC 810, E-Commerce Tianjin is included in the Company's consolidated financial statements since then. Pursuant to Chinese law and regulations, a foreign owned enterprise cannot apply for and hold a license for operation of certain e-commerce businesses, the category of business which the Company plans to expand in China. CCM Tianjin is an indirectly wholly foreign owned enterprise of the Company. In order to comply with Chinese law and regulations, CCM Tianjin agreed to provide E-commerce Tianjin an Exclusive Operation and Use Rights Authorization to operate and use the Chain Cloud Mall System owned by CCM Tianjin. E-commerce Tianjin was incorporated by Mr. Zeyao Xue and Mr. Kai Xu solely for the purpose of holding the operation license of the Chain Cloud Mall System. Mr. Zeyao Xue is a major shareholder of the Company and the son of Mr. Yongke Xue, our Chairman and Chief Executive Officer. Mr. Kai Xu is the Chief Operating Officer of the Company. The VIE Agreements are as follows: 1) Exclusive Technology Consulting and Service Agreement by and between CCM Tianjin and E-commerce Tianjin. Pursuant to the Exclusive Technology Consulting and Service Agreement, CCM Tianjin agreed to act as the exclusive consultant of E-commerce Tianjin and provide technology consulting and services to E-commerce Tianjin. In exchange, E-commerce Tianjin agreed to pay CCM Tianjin a technology consulting and service fee, the amount of which is to be equivalent to the amount of net profit before tax of E-commerce Tianjin, payable on a quarterly basis after making up losses of previous years (if necessary) and deducting necessary costs, expenses and taxes related to the business operations of E-commerce Tianjin. Without the prior written consent of CCM Tianjin, E-commerce Tianjin may not accept the same or similar technology consulting and services provided by any third party during the term of the agreement. All the benefits and interests generated from the agreement, including but not limited to intellectual property rights, know-how and trade secrets, will be CCM Tianjin's sole and exclusive property. This agreement has a term of 10 years and may be extended unilaterally by CCM Tianjin with CCM Tianjin's written confirmation prior to the expiration date. E-commerce Tianjin cannot terminate the agreement early unless CCM Tianjin commits fraud, gross negligence or illegal acts, or becomes bankrupt or winds up. 2) Exclusive Purchase Option Agreement by and among CCM Tianjin, E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu. Pursuant to the Exclusive Purchase Option Agreement, Mr. Zeyao Xue and Mr. Kai Xu granted to CCM Tianjin and any party designated by CCM Tianjin the exclusive right to purchase, at any time during the term of this agreement, all or part of the equity interests in E-commerce Tianjin, or the "Equity Interests," at a purchase price equal to the registered capital paid by Mr. Zeyao Xue and Mr. Kai Xu for the Equity Interests, or, in the event that applicable law requires an appraisal of the Equity Interests, the lowest price permitted under applicable law. Pursuant to powers of attorney executed by Mr. Zeyao Xue and Mr. Kai Xu, they irrevocably authorized any person appointed by CCM Tianjin to exercise all shareholder rights, including but not limited to voting on their behalf on all matters requiring approval of E-commerce Tianjin's shareholder, disposing of all or part of the shareholder's equity interest in E-commerce Tianjin, and electing, appointing or removing directors and executive officers. The person designated by CCM Tianjin is entitled to dispose of dividends and profits on the equity interest without reliance on any oral or written instructions of Mr. Zeyao Xue and Mr. Kai Xu. The powers of attorney will remain in force for so long as Mr. Zeyao Xue and Mr. Kai Xu remain the shareholders of E-commerce Tianjin. Mr. Zeyao Xue and Mr. Kai Xu have waived all the rights which have been authorized to CCM Tianjin's designated person under the powers of attorney. 3) Equity Pledge Agreements by and among CCM Tianjin, E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu. Pursuant to the Equity Pledge Agreements, Mr. Zeyao Xue and Mr. Kai Xu pledged all of the Equity Interests to CCM Tianjin to secure the full and complete performance of the obligations and liabilities on the part of E-commerce Tianjin and them under this and the above contractual arrangements. If E-commerce Tianjin, Mr. Zeyao Xue, or Mr. Kai Xu breaches their contractual obligations under these agreements, then CCM Tianjin, as pledgee, will have the right to dispose of the pledged equity interests. Mr. Zeyao Xue and Mr. Kai Xu agree that, during the term of the Equity Pledge Agreements, they will not dispose of the pledged equity interests or create or allow any encumbrance on the pledged equity interests, and they also agree that CCM Tianjin's rights relating to the equity pledge should not be interfered with or impaired by the legal actions of the shareholders of E-commerce Tianjin, their successors or designees. During the term of the equity pledge, CCM Tianjin has the right to receive all of the dividends and profits distributed on the pledged equity. The Equity Pledge Agreements will terminate on the second anniversary of the date when E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu have completed all their obligations under the contractual agreements described above. |
Unaudited Condensed Pro Forma F
Unaudited Condensed Pro Forma Financial Statements | 12 Months Ended |
Dec. 31, 2019 | |
Business Acquisition, Pro Forma Information [Abstract] | |
UNAUDITED CONDENSED PRO FORMA FINANCIAL STATEMENTS | 16 . Unaudited Condensed Pro Forma Financial Statements The following unaudited pro forma condensed consolidated financial statements have been prepared to illustrate the effect after the Sale Transaction. The unaudited pro forma condensed consolidated balance sheet as of December 31, 2019 reflects the pro forma effect as if the sale of HeDeTang HK was consummated at December 31, 2019. The unaudited pro forma condensed consolidated statements of operations of the Company for the periods ended December 31, 2019 and December 31, 2018, respectively, assume that the sale was consummated on January 1, 2019, and January 1, 2018, respectively. The unaudited pro forma condensed consolidated balance sheet and statements of operations include pro forma adjustments which reflect transactions and events that (a) are directly attributable to the Sale Transaction, (b) are factually supportable and (c) with respect to the statements of operations, have a continuing impact on consolidated results of the Company. The pro forma adjustments are described in the accompanying notes to the unaudited pro forma condensed consolidated financial statements. The unaudited pro forma condensed consolidated financial information does not reflect the tax consequences in any jurisdictions attributable to the Sale Transaction, and it does not reflect future events that may occur after the sale, including potential general and administrative cost savings. The unaudited pro forma condensed consolidated financial information is provided for informational purposes only and is not necessarily indicative of the Company's future operating results. The pro forma adjustments are subject to change and are based upon currently available information. December 31, ASSETS CURRENT ASSETS Cash and cash equivalents $ 539,316 Accounts receivable, net of allowance of $16,127,000 as of December 31, 2019 and $15,650,217 as of December 31, 2018, respectively 4,954 Other receivables, net 7,489 Inventories 3,594 Advances to suppliers and other current assets 1,668,847 TOTAL CURRENT ASSETS $ 2,224,200 Property, plant and equipment, net $ 17,855 Intangible assets 5,312,906 Amount due from related parties 3,402,823 Long-term investments 12,250,000 TOTAL ASSETS $ 23,207,784 LIABILITIES CURRENT LIABILITIES Accounts payable $ 320,378 Accrued expenses 4,547,380 Advances from customers 702,179 Short-term bank loans 957,990 TOTAL CURRENT LIABILITIES $ 6,527,927 NON-CURRENT LIABILITIES Amount due to related parties 1,268,101 TOTAL NON-CURRENT LIABILITIES 1,268,101 TOTAL LIABILITIES $ 7,796,028 Commitments and contingencies(Note 16) STOCKHOLDER'S EQUITY Future FinTech Group, Inc, Stockholders' equity Common stock, $0.001 par value; 60,000,000 shares authorized and 33,810,416 shares and 31,017,083 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively $ 33,810 Additional paid-in capital 107,852,827 Accumulated deficits (109,825,651 ) Accumulated other comprehensive income (loss) 12,989,409 Total Future FinTech Group, Inc. stockholders' equity 11,050,395 Non-controlling interests 4,361,361 Total stockholders' equity 15,411,756 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 23,207,784 Pro Forma For Pro Forma For 2019 2018 Revenue $ 955,172 $ 131,832 Cost of goods sold 464,307 83,888 Gross profit 490,865 47,944 Operating Expenses General and administrative expenses 4,913,656 1,636,298 Selling expenses 500,949 14,482 Bad debt provision 5,234,205 - Inventory markdown 27,247 - Impairment Loss 2,751,099 44,665,618 Total operating expenses 13,427,156 46,316,398 Loss from operations (12,936,291 ) (46,268,454 ) Other (expenses) income Interest income 3,995 711 Interest expenses (523,676 ) 96,329 Other income(expenses) (229,042 ) (4,382,686 ) Total other income (expenses), net (748,723 ) (4,285,646 ) Loss from Continuing Operations before Income Tax (13,685,014 ) (50,554,100 ) Income tax provision - 206 Loss from Continuing Operations before Non-controlling Minority Interest (13,685,014 ) (50,554,306 ) Less: Net loss attributable to non-controlling interests (163,576 ) (123,139 ) Loss from Continuing Operations $ (13,521,438 ) $ (50,431,167 ) Discontinued Operations Loss from discontinued operations - - NET LOSS ATTRIBUTABLE TO FUTURE FINTECH GROUP INC $ (13,521,438 ) $ (50,431,167 ) Earnings per share: Basic earnings per share from continued operation $ (0.42 ) $ (2.33 ) Basic earnings per share from discontinued operation - - $ (0.42 ) $ (2.33 ) Diluted Earnings per share: Diluted earnings per share from continued operation $ (0.42 ) $ (2.30 ) Diluted earnings per share from discontinued operation - - $ (0.42 ) $ (2.30 ) Weighted average number of shares outstanding Basic 33,996,279 21,636,146 Diluted 33,996,279 21,966,612 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 17 . SUBSEQUENT EVENTS On January 6, 2020, the Company entered into the Eighth Exchange Agreement (the "Eighth Exchange Agreement") with Iliad Research and Trading, L.P., a Utah limited partnership (the "Lender"). Pursuant to the Eighth Exchange Agreement, the Company and Lender agreed to partition a new Secured Convertible Promissory Note in the original principal amount of $145,000 (the "Eighth Partitioned Note") from a Secured Convertible Promissory Note (the "Note") issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Partitioned Note. The Company and Lender further agreed to exchange the Eighth Partitioned Note for the delivery of 193,333 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Exchange Agreement. On January 15, 2020, the Company entered into the Ninth Exchange Agreement (the "Ninth Exchange Agreement") with the Lender. Pursuant to the Exchange Agreement, the Company and Lender agreed to partition a new Secured Convertible Promissory Note in the original principal amount of $140,000 (the "Ninth Partitioned Note") from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Ninth Partitioned Note. The Company and Lender further agreed to exchange the Partitioned Note for the delivery of 186,666 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Exchange Agreement. On January 25, 2020, the Company entered into a Consulting Service Agreement (the "Agreement") with Dragon Investment Holding Limited (Malta) (the "Consultant"), a company incorporated in Malta, pursuant to which Consultant will: (i) help the Company to locate new merger projects globally, develop new merger strategy and provide the Company with at least five (5) merger and acquisition targets that have synergy with the Company's business and development plans and could clearly contribute to the Company's strategic goals each year; (ii) help the Company to map out new growth strategies in addition to its current business; (iii) work with the Company to explore new lines of business and associated growth strategies; and (iv) conduct market research and evaluating variable projects and providing feasibility studies per Company's request from time to time. The term of the Agreement is three years. In consideration of the services to be provided by Consultant to the Company, the Company agrees to pay the Consultant a three-year consulting fee totaling $3 million. The Company shall issue a total of 3,750,000 restricted shares of common stock of the Company (the "Shares") at a price of $0.80 per share as the payment for the above mentioned consultant fee to the Consultant. The parties agree that no shares will be issued until the board of directors of the Company (the "Board") and NASDAQ approve the issuance of the Shares. The Company agrees to issue the Shares in the name of the Consultant within 10 days after approval from the Board and NASDAQ, among which 1,500,000 shares should be released to the Consultant immediately upon issuance, 1,125,000 shares will be held by the Company and released to the Consultant on January 25, 2021 if this Agreement has not been terminated and there has been no breach of Agreement by the Consultant at such time, and the last 1,125,000 shares will be held by the Company and released to the Consultant on January 25, 2022 if this Agreement has not been terminated and there has been no breach of the Agreement by the Consultant at such time. If the second and/or third release of the shares mentioned above does not occur, such shares shall be returned to the Company as treasury shares. If NASDAQ does not approve the issuance of the Shares, the parties agree to negotiate other payment methods and, if no agreement can be reached by the parties, this Agreement shall be terminated immediately. The shares contemplated in the Agreement will be issued pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. On February 26, 2020, the Company held a Special Meeting of shareholders (the "Special Meeting"). A quorum was present at the Special Meeting, and shareholders: (i) approved the sale of the Company's subsidiary, HeDeTang Holdings (HK) Ltd. ("HeDeTang HK"), to New Continent International Co., Ltd., (the "Buyer") a company incorporated in the British Virgin Islands (the "Sale Transaction"), which was closed on February 27, and (ii) approved and adopted the Future FinTech Group Inc. 2019 Omnibus Equity Plan. On March 11, 2020, the Company entered into the Tenth Exchange Agreement (the "Tenth Exchange Agreement") with the Lender. Pursuant to the Tenth Exchange Agreement, the Company and Lender agreed to partition a new Secured Convertible Promissory Note in the original principal amount of $150,000 (the "Tenth Partitioned Note") from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Partitioned Note. The Company and Lender further agreed to exchange the Partitioned Note for the delivery of 200,000 shares of the Company's Common Stock, par value $0.001, according to the terms and conditions of the Exchange Agreement. In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, which has and is continuing to spread throughout China and other parts of the world, including the United States. On January 30, 2020, the World Health Organization declared the outbreak of the coronavirus disease (COVID-19) a "Public Health Emergency of International Concern," and on March 11, 2020, the World Health Organization characterized the outbreak as a "pandemic". Xi'an City and Beijing City, where our headquarters are located, are among the most affected areas in China. The pandemic has resulted in quarantines, travel restrictions, and the temporary closure of office buildings and facilities in China.Substantially all of our revenues are generated in China. The Company's business and services and results of operations have been adversely affected and could continue to be adversely affected by the COVID-19 pandemic. On March 11,2020, the Company's Board of Directors passed a resolution to sale the operation of Globalkey Supply Chain limited and Zhonglian Hengxin Assets Management Co. Ltd and close the operation of Digital Online Marketing Limited, Future Digital Fintech (Xi'an) Co. Ltd., SkyPeople Foods Holding Ltd. and Chain Future Digital Tech (Beijing) Co. Ltd. Based on the disposal plan and in accordance with ASC 205-20, the Company presented the operating results from these operations as a discontinued operation. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Basis of preparation and principle of consolidation | Basis of preparation and principle of consolidation These financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, or US GAAP. The Company's functional currency of subsidiaries and VIEs in China is the Chinese Renminbi (RMB). Other subsidiaries outside of China use USD as the functional currency; however, the accompanying consolidated financial statements have been translated and presented in USD. According to USGAAP ASC 810-10-15-8, for legal entities other than limited partnerships, the usual condition for a controlling financial interest is ownership of a majority voting interest, and, therefore, as a general rule ownership by one reporting entity, directly or indirectly, of more than 50 percent of the outstanding voting shares of another entity is a condition pointing toward consolidation. The power to control may also exist with a lesser percentage of ownership, for example, by contract, lease, agreement with other stockholders, or by court decree. The consolidated financial statements include the accounts of the Company and its subsidiaries. The consolidated financial statements are prepared in accordance with U.S. GAAP. This basis differs from that used in the statutory accounts of subsidiaries and VIEs in the PRC, which were prepared in accordance with the accounting principles and relevant financial regulations applicable to enterprises in the PRC. All necessary adjustments have been made to present the financial statements in accordance with U.S. GAAP. All significant inter-company accounts and transactions have been eliminated. Certain amounts of prior years were reclassified to conform with current year presentation. |
Discontinued Operations | Discontinued Operations As discussed previously, On February 27, 2020, SkyPeople BVI (the "Seller") completed the transfer of its ownership of HeDeTang HK to New Continent International Co., Ltd. (the "Buyer"), an unrelated third party and a company incorporated in the British Virgin Islands for a total price of RMB 0.6 million (approximately $85,714), pursuant to a Share Transfer Agreement entered into by the Seller and the Buyer on September 18, 2019 and approved at the special shareholders meeting of the Company on February 26, 2020. As the Company believed that no continued cash flow would be generated by the sold component, in accordance with ASC 205-20, the Company presented the operating results from Hedetang as discontinued operations within the accompanying consolidated financial statements. In addition, The Company's Huludao Wonder operation, a subsidiary which produces concentrated apple juice, suffered continued operating losses since 2014 and its cash flow was minimal for these three years. In December 2016, the Company established a winding-down plan to close this operation. Based on the restructuring plan and in accordance with ASC 205-20, the Company presented the operating results from Huludao Wonder as a discontinued operation. On March 11,2020, the Company's Board of Directors passed a resolution to sale the operation of Globalkey Supply Chain limited and Zhonglian Hengxin Assets Management Co. Ltd and close the operation of Digital Online Marketing Limited, Future Digital Fintech (Xi'an) Co. Ltd., SkyPeople Foods Holding Ltd. and Chain Future Digital Tech (Beijing) Co. Ltd. Based on the disposal plan and in accordance with ASC 205-20, the Company presented the operating results from these operations as a discontinued operation. |
Segment Information Reclassification | Segment Information Reclassification Historically, the Company operated in five segments: concentrated apple juice and apple aroma, concentrated kiwifruit juice and kiwifruit puree, concentrated pear juice, fruit juice beverages, and others. As the Company classified the juice related operation into discontinued operation, in the beginning of year 2019, and in accordance with the Company's new business strategy, the Company classified business segment into CCM Shopping Mall Membership, sales of goods and others. |
Use of Estimates | Use of Estimates The Company's consolidated financial statements have been prepared in accordance with US GAAP and this requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenue and expenses during the reporting period. The significant areas requiring the use of management estimates include, but not limited to, the allowance for doubtful accounts receivable, estimated useful life and residual value of property, plant and equipment, impairment of long-lived assets provision for staff benefit, valuation of change in fair value of warrant liability, recognition and measurement of deferred income taxes and valuation allowance for deferred tax assets. Although these estimates are based on management's knowledge of current events and actions management may undertake in the future, actual results may ultimately differ from those estimates and such differences may be material to our consolidated financial statements. |
Going Concern | Going Concern The Company's financial statements are prepared assuming that the Company will continue as a going concern. The Company incurred operating losses and had negative operating cash flows and may continue to incur operating losses and generate negative cash flows as the Company implements its future business plan. In order to meet its working capital needs through the next twelve months and to fund the growth of the Company, the Company may consider plans to raise additional funds through the issuance of equity or debt. Although the Company intends to obtain additional financing to meet its cash needs, the Company may be unable to secure any additional financing on terms that are favorable or acceptable to it, if at all. The ability of the Company to continue as a going concern is dependent upon its ability to successfully execute its new business strategy and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets In accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company has adopted FASB Accounting Standard Codification Topic on Fair Value Measurements and Disclosures ("ASC 820"), which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. ASC 820 establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable input, which may be used to measure fair value and include the following: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Input other than Level 1 that is observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other input that is observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable input that is supported by little or no market activity and that is significant to the fair value of the assets or liabilities. Our cash and cash equivalents and restricted cash are classified within level 1 of the fair value hierarchy because they are value using quoted market price. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Under ASC 260-10, Earnings Per Share Diluted EPS is calculated by using the treasury stock method, assuming conversion of all potentially dilutive securities, such as stock options and warrants. Under this method, (i) exercise of options and warrants is assumed at the beginning of the period and shares of Common Stock are assumed to be issued, (ii) the proceeds from exercise are assumed to be used to purchase Common Stock at the average market price during the period, and (iii) the incremental shares (the difference between the number of shares assumed issued and the number of shares assumed purchased) are included in the denominator of the diluted EPS computation. The numerators and denominators used in the computations of basic and diluted EPS are presented in the following table. Year Ended December 31, 2019 2018 NUMERATOR FOR BASIC AND DILUTED EPS Net loss from continuing operations (numerator for EPS) $ (13,521,438 ) $ (174,010,421 ) Net (income) )loss from discontinued operations (numerator for EPS) (11,707,493 ) 4,013,367 Net loss allocated to Common Stockholders $ (25,228,932 ) $ (169,997,054 ) Loss per share: Basic loss per share from continued operations $ (0.47 ) $ (8.04 ) Basic income (loss) per share from discontinued operations (0.37) 0.19 Basic loss per share from net loss $ (0.79 ) $ (7.85 ) Diluted loss per share: Diluted loss per share from discontinued operations $ (0.47 ) $ (7.92 ) Diluted income (loss) per share from discontinued operations (0.37) 0.18 Diluted loss per share from net loss $ (0.79 ) $ (7.74 ) Weighted average Common Stock outstanding 31,996,279 21,636,146 DENOMINATOR FOR BASIC AND DILUTED EPS 31,996,279 21,966,612 |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents included cash on hand and demand deposits placed with banks or other financial institutions, which are unrestricted as to withdrawal and use and with an original maturity of three months or less. Deposits in banks in the PRC are only insured by the government up to RMB500,000, and are consequently exposed to risk of loss. The Company believes the probability of a bank failure, causing loss to the Company, is remote. |
Accounts Receivable and Allowances | Accounts Receivable and Allowances Accounts receivable are recognized and carried at the original invoice amounts less an allowance for any uncollectible amount. We have a policy of reserving for uncollectible accounts based on our best estimate of the amount of probable credit losses in our existing accounts receivable. We extend credit to our customers based on an evaluation of their financial condition and other factors. We generally do not require collateral or other security to support accounts receivable. We perform ongoing credit evaluations of our customers and maintain an allowance for potential bad debts if required. We determine whether an allowance for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. In these cases, we use assumptions and judgment, based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The amounts calculated are analyzed to determine the total amount of the allowance. We may also record a general allowance as necessary. Direct write-offs are taken in the period when we have exhausted our efforts to collect overdue and unpaid receivable or otherwise evaluate other circumstances that indicate that we should aban don such efforts. The Company has assessed its accounts receivable including credit term and corresponding all its accounts receivables in December 2019. Upon such credit terms, bad debt expense was increased by $5.23 million and $16.31 million during the years ended December 31, 2019 and 2018, respectively. Accounts receivables of $2,477 and $619.13 million have been outstanding for over 90 days as of December 31, 2019 and December 31, 2018, respectively. |
Inventories | Inventories Inventories consist of raw materials, packaging materials (which include ingredients and supplies) and finished goods (which include finished juice in the bottling, canning operations and other. Inventories also consist of merchant gift package to be delivered with the new membership signed up in our e-commerce platform. Inventories are valued at the lower of cost or market. We determine cost on the basis of the weighted average method. The Company periodically reviews inventories for obsolescence and any inventories identified as obsolete are written off. |
Revenue Recognition | Revenue Recognition We adopted Accounting Standards Codification Topic 606, Revenue from Contracts with Customers (ASC 606) and all related amendment from January 1, 2018. We apply the five steps defined under ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We assess its revenue arrangements against specific criteria in order to determine if it is acting as principal or agent. Revenue arrangements with multiple performance obligations are divided into separate distinct goods or services. We allocate the transaction price to each performance obligation based on the relative standalone selling price of the goods or services provided. Revenue is recognized upon the transfer of control of promised goods or services to a customer. We do not make any significant judgment in evaluating when control is transferred. Revenue is recorded net of value-added tax. Revenue recognitions are as follows: Sales of juice and other products: We recognize revenue when the receipt of merchandise is confirmed by the customers, which is the point that the title of the goods is transferred to the customer. We recognize revenues when we satisfy a performance obligation by transferring a promised good or service (that is, an asset) to a customer. An asset is transferred when the customer obtains control of that asset. Customers have no contractual right to return products. Historically, the Company has not had any returned products. Accordingly, no provision has been made for returnable goods. The Company is not required to rebate or credit a portion of the original fee if it subsequently reduces the price of its product to its suppliers. The Company does not make any significant judgment in determination of the amount and timing of revenue from contracts with customers. On-line sales and Membership fee: The Company recognizes the sale of goods 15 days after the products are shipped (after the 15 days return policy). The revenue from the membership fee is amortized over the lifetime of the membership, which is one year. For the merchandise gift package, revenue is recognized when the receipt of the gift package is confirmed by the members. Other revenues include revenues earned on net basis from sales of certain products on our platform. |
Shipping and Handling Costs | Shipping and Handling Costs Shipping and handling amounts billed to customers in sales transactions are included in sales revenues and shipping expenses incurred by the Company are reported as a component of selling expenses. The shipping and handling expenses of $1,180 and $33,145 for fiscal years 2019 and 2018, respectively, are reported in the Consolidated Statements of Income and Comprehensive Income as a component of selling expenses. |
Advertising and Promotional Expense | Advertising and Promotional Expense Advertising and promotional costs are expensed as incurred and are included in selling expenses. The Company incurred $19,128 and $19,341 in advertising and promotional costs for the years ended December 31, 2019 and 2018, respectively. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Depreciation is computed using the straight-line method over the useful lives of the assets. Major renewals and betterments are capitalized and depreciated; maintenance and repairs that do not extend the life of the respective assets are expensed as incurred. Upon disposal of assets, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in the consolidated statements of income and comprehensive income. Depreciation related to property, plant and equipment used in production is reported in cost of sales, and includes amortized amounts related to capital leases. We estimated that the residual value of the Company's property and equipment ranges from 3% to 5%. Property, plant and equipment are depreciated over their estimated useful lives as follows: Buildings 20-30 years Machinery and equipment 5-10 years Furniture and office equipment 3-5 years Motor vehicles 5 years |
Intangible Assets | Intangible Assets Acquired intangible assets are recognized based on their cost to the Company, which generally includes the transaction costs of the asset acquisition, and no gain or loss is recognized unless the fair value of noncash assets given as consideration differs from the assets' carrying amounts on the Company's book. These assets are amortized over their useful lives if the assets are deemed to have a finite life and they are reviewed for impairment by testing for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The fair value of an intangible asset is the amount that would be determined if the entity used the assumptions that market participants would use if they were pricing the intangible asset. The useful life of the Company's intangible assets is ten year, which is determined by using the time period that an intangible is estimated to contribute directly or indirectly to a company's future cash flows. |
Foreign Currency and Other Comprehensive Income (Loss) | Foreign Currency and Other Comprehensive Income (Loss) The financial statements of the Company's foreign subsidiaries are measured using the local currency as the functional currency; however, the reporting currency of the Company is the USD. Assets and liabilities of the Company's foreign subsidiaries have been translated into USD using the exchange rate at the balance sheet date, while equity accounts are translated using historical exchange rate. The exchange rate we used to convert RMB to USD was 6.98 and 6.86 at the balance sheet date of December 31, 2019 and December 31, 2018, respectively. The average exchange rate for the period has been used to translate revenues and expenses. The average exchange rate we used to convert RMB to USD was 6.90 and 6.62 for fiscal year 2019 and fiscal year 2018, respectively. Translation adjustments are reported separately and accumulated in a separate component of equity (cumulative translation adjustment). Other comprehensive loss for the year ended December 31, 2019 and 2018 represented foreign currency translation adjustments loss of $36.85 million and $85.18 million, respectively, and were included in the consolidated statements of comprehensive income (loss). |
Income Taxes | Income Taxes We use the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, "Income Taxes." Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity's financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences 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 results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized. ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740-10-25 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have no material uncertain tax positions for any of the reporting periods presented. |
Right of Use Assets | Right of Use Assets The Company paid in advance for land use rights according to Chinese law. Prepaid land use rights are being amortized and recorded as lease expenses using the straight-line method over the use terms of the lease, which are 40 to 50 years. |
Lease | Lease In February 2016, the Financial Accounting Standards Board (FASB) issued ASU No. 2016-02, Leases, and in July 2018, issued ASU No. 2018-10 and 2018-11 and in December 2018, issued ASU No. 2018-20 and in March 2019, issued ASU No. 2019-01, which amended the standard, replacing existing lease accounting guidance. The new standard introduced a lessee model that requires entities to recognize assets and liabilities for most leases, but recognize expenses on their income statements in a manner similar to current accounting. The ASU did not make fundamental changes to previous lessor accounting. For the Company, the ASU was effective January 1, 2019. As amended, the ASU provided for retrospective transition applied to earliest period presented or an adoption method by which entities would not need to recast the comparative periods presented. The Company did not recast prior periods as it adopted this ASU. As a result of adopting this ASU, the Company recorded approximately $0 of lease assets and lease liabilities related to transition upon this ASU's adoption. After adoption of ASU 2016-02 and related standards, operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For short-term leases with an initial lease term of 12 months or less and with purchase options we are reasonably certain will not be exercised. As a lessee, the Company leases equipment, land and office building. Lease expense is recognized on a straight-line basis over the lease term. |
Convertible notes | Convertible notes The Company accounts for its convertible notes at issuance by allocating the proceeds received from a convertible note among freestanding instruments according to ASC 470, Debt, based upon their relative fair values. The fair value of debt and common stock is determined based on the closing price of the common stock on the date of the transaction. Convertible notes are subsequently carried at amortized cost. Each convertible note is analyzed for the existence of a beneficial conversion feature ("BCF"), defined as the fair value of the common stock at the commitment date for the convertible note, less the effective conversion price. No BCF was recognized for the convertible notes issued during 2019. |
Share-based compensation | Share-based compensation The Company awards share options and other equity-based instruments to its employees, directors and consultants (collectively "share-based payments"). Compensation cost related to such awards is measured based on the fair value of the instrument on the grant date. The Company recognizes the compensation cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The amount of cost recognized is adjusted to reflect the expected forfeiture prior to vesting. When no future services are required to be performed by the employee in exchange for an award of equity instruments, and if such award does not contain a performance or market condition, the cost of the award is expensed on the grant date. The Company recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date. |
New Accounting Pronouncements | New Accounting Pronouncements In June 2016, the FASB issued ASU No. 2016-13 ("ASU 2016-13") "Financial Instruments - Credit Losses" ("ASC 326"): Measurement of Credit Losses on Financial Instruments" which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. In November 2019, the FASB issued ASU 2019-10 "Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842)" ("ASC 2019-10"), which defers the effective date of ASU 2016-13 to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, for public entities which meet the definition of a smaller reporting company. The Company will adopt ASU 2016-13 effective January 1, 2023. Management is currently evaluating the effect of the adoption of ASU 2016-13 on the consolidated financial statements. The effect will largely depend on the composition and credit quality of our investment portfolio and the economic conditions at the time of adoption. In December 2019, the FASB issued the amendments in ASU 2019-12 ASC Topic 740, Income Taxes: Simplifying Accounting for Income Taxes Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material impact on the accompanying consolidated financial statements. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Schedule of numerators and denominators used in the computations of basic and diluted EPS | Year Ended December 31, 2019 2018 NUMERATOR FOR BASIC AND DILUTED EPS Net loss from continuing operations (numerator for EPS) $ (13,521,438 ) $ (174,010,421 ) Net (income) )loss from discontinued operations (numerator for EPS) (11,707,493 ) 4,013,367 Net loss allocated to Common Stockholders $ (25,228,932 ) $ (169,997,054 ) Loss per share: Basic loss per share from continued operations $ (0.42 ) $ (8.04 ) Basic income (loss) per share from discontinued operations (0.37 ) 0.19 Basic loss per share from net loss $ (0.79 ) $ (7.85 ) Diluted loss per share: Diluted loss per share from discontinued operations $ (0.42 ) $ (7.92 ) Diluted income (loss) per share from discontinued operations (0.37 ) 0.18 Diluted loss per share from net loss $ (0.79 ) $ (7.74 ) Weighted average Common Stock outstanding 31,996,279 21,636,146 DENOMINATOR FOR BASIC AND DILUTED EPS 31,996,279 21,966,612 |
Schedule of property, plant and equipment are depreciated estimated useful lives | Buildings 20-30 years Machinery and equipment 5-10 years Furniture and office equipment 3-5 years Motor vehicles 5 years |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories by major categories | December 31, 2019 2018 Raw materials and packaging $ - $ 24,578 Finished goods 37,269 2,502,803 Less: impairment loss (33,675 ) (2,464,364 ) Inventories $ 3,594 $ 63,017 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | December 31, 2019 2018 Machinery and equipment $ $ 32,702,621 Furniture and office equipment 36,958 368,875 Motor vehicles - 355,820 Buildings - 54,689,750 Construction in progress - 185,646 Subtotal 36,958 88,302,711 Less: accumulated depreciation (11,902 ) (41,420,859 ) Less: Impairment loss (7,201 ) (44,545,816 ) Net property and equipment $ 17,855 $2,336,0 36 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of table sets forth land usage rights | December 31, 2019 2018 Cost $ 5,847,008 $ 24,003,243 Less: Accumulated amortization (574,996 ) (2,556,898 ) Less: Impairment Loss - (6,895,078 ) $ 5,272,012 14,551,266 |
Related Party Transaction (Tabl
Related Party Transaction (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of related party transactions | Name of Related Party from Whom Amounts were Received Amount Relationship Note Yongke Xue 28,539 Chairman of the Company Loan payable Shanchun Huang 71,672 Chief Executive Officer of the Company Loan payable Shenzhen TianShunDa Equity Investment Fund Management Co., Ltd., 573,142 Holds 26.36% of equity shares of SkyPeople China Interest free loan* InUnion Chain Ltd. ("INU") 209,957 The Company is the 10% equity shareholder of INU Accounts payables Zhi Yan 40,710 Chief Technology Officer of the Company Loan payable Jing chen 6,527 Chief Financial Officer of the Company Payable to employee Zeyao Xue 310,746 Son of the Chairman of the Company and a shareholder of the Company Chief Operating Officer of the Company Loan payable Kai Xu 26,808 Chief Operating Officer of the Company Payable to employee Name of Related Party to Whom Amount Relationship Note Shaanxi Chunlv Ecological Agriculture Co. Ltd. 3,356,070 Holds 20.0% interest in CCM logistics Interest free loan* Quangoutong Commercial Holdings (Xi'an) Co., Ltd ("Quangoutong") 22,935 Shaanxi Fullmart Convenient Chain Supermarket Co., Ltd. ("Fullmart") holds 16.67% equity of its subsidiary. The subsidiary is 83.33% owned by Quangoutong Service fee due Shaanxi Quangou Convenient Island Co. Ltd. 23,828 Fullmart holds 33.33% its equity Interest free loan* ● The interest free loans have been approved by the Company's Audit Committee. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of loss from discontinued operations | December 31, December 31, 2019 2018 REVENUES $ 330,195 $ 756,838 COST OF SALES 315,737 891,154 GROSS PROFIT 14,459 (134,316 ) OPERATING EXPENSES: General and administrative 2,994,965 10,308,627 Selling expenses 172,449 174,097 Bad debt expenses 3,026,472 Impairment loss - 133,631,129 Total 6,193,885 144,113,852 OTHER INCOME (EXPENSE) Interest income 116 - Interest expense (7,300,070 ) (1,721,012 ) other income (expenses) 90,149 6,770,498 ) Total (7,209,805 ) (5,050,147 ) Loss from discontinued operations before income tax (13,389,231 ) (139,198,021 ) Income tax provision - 31 Loss from discontinued operation before Minority Interest $ (13,389,231 ) $ (139,198,052 ) Less: Net loss attributable to non-controlling interests (1,681,738 ) 15,618,798 LOSS FROM DISCONTINUED OPERATION $ (11,707,493 ) $ (123,579,254 |
Schedule of assets and liabilities related to discontinued operations | December 31, December 31, Cash $ 123,087 $ 220,342 Accounts receivable 11,720 73,244 Other receivables 1,861 15,381,465 Inventory 454,269 63,017 Advances to suppliers and other current assets 97,539 - Property and equipment, net 1,176,163 2,276,704 Right of use assets 57,571,254 Intangible assets, net 15,347,535 15,968,625 Amount due from related parties 17,989,358 Total assets related to discontinued operations $ 92,772,786 33,933,396 Accounts payable $ 2,084,735 $ 9,002,384 Accrued expenses 81,279,952 78,644,119 Advances from customers 815,382 772,078 Short-term bank loans 37,245,139 5,828,185 Lease liabilities 60,613,970 - Amount due from related parties 14,222,570 - Long-term loan 14,222,570 32,450,867 Total liabilities related to discontinued operations $ 196,261,748 $ 126,697,633 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of segment profit representing the gross profit | CCM Shopping Sales of Goods Others Total Reportable segment revenue $ 542 $ 378 $ 412 $ 1,332 Inter-segment loss - - (377 ) (377 ) Revenue from external customers 542 378 35 955 Segment gross profit $ 401 $ 72 $ 18 $ 491 CCM Shopping Sales of Goods Others Total Reportable segment revenue $ - $ - $ 132 $ 132 Inter-segment loss - - - - Revenue from external customers - - 132 132 Segment gross profit $ - $ - $ 48 $ 48 |
Unaudited Condensed Pro Forma_2
Unaudited Condensed Pro Forma Financial Statements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Acquisition, Pro Forma Information [Abstract] | |
Schedule of Consolidated Statements Of Balance Sheet | December 31, ASSETS CURRENT ASSETS Cash and cash equivalents $ 539,316 Accounts receivable, net of allowance of $16,127,000 as of December 31, 2019 and $15,650,217 as of December 31, 2018, respectively 4,954 Other receivables, net 7,489 Inventories 3,594 Advances to suppliers and other current assets 1,668,847 TOTAL CURRENT ASSETS $ 2,224,200 Property, plant and equipment, net $ 17,855 Intangible assets 5,312,906 Amount due from related parties 3,402,823 Long-term investments 12,250,000 TOTAL ASSETS $ 23,207,784 LIABILITIES CURRENT LIABILITIES Accounts payable $ 320,378 Accrued expenses 4,547,380 Advances from customers 702,179 Short-term bank loans 957,990 TOTAL CURRENT LIABILITIES $ 6,527,927 NON-CURRENT LIABILITIES Amount due to related parties 1,268,101 TOTAL NON-CURRENT LIABILITIES 1,268,101 TOTAL LIABILITIES $ 7,796,028 Commitments and contingencies(Note 16) STOCKHOLDER'S EQUITY Future FinTech Group, Inc, Stockholders' equity Common stock, $0.001 par value; 60,000,000 shares authorized and 33,810,416 shares and 31,017,083 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively $ 33,810 Additional paid-in capital 107,852,827 Accumulated deficits (109,825,651 ) Accumulated other comprehensive income (loss) 12,989,409 Total Future FinTech Group, Inc. stockholders' equity 11,050,395 Non-controlling interests 4,361,361 Total stockholders' equity 15,411,756 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 23,207,784 |
Schedule of Consolidated Statements Of Income And Comprehensive Income Of Comparison Between Pro Forma And Future Fintech Group Inc. | Pro Forma For Pro Forma For 2019 2018 Revenue $ 955,172 $ 131,832 Cost of goods sold 464,307 83,888 Gross profit 490,865 47,944 Operating Expenses General and administrative expenses 4,913,656 1,636,298 Selling expenses 500,949 14,482 Bad debt provision 5,234,205 - Inventory markdown 27,247 - Impairment Loss 2,751,099 44,665,618 Total operating expenses 13,427,156 46,316,398 Loss from operations (12,936,291 ) (46,268,454 ) Other (expenses) income Interest income 3,995 711 Interest expenses (523,676 ) 96,329 Other income(expenses) (229,042 ) (4,382,686 ) Total other income (expenses), net (748,723 ) (4,285,646 ) Loss from Continuing Operations before Income Tax (13,685,014 ) (50,554,100 ) Income tax provision - 206 Loss from Continuing Operations before Non-controlling Minority Interest (13,685,014 ) (50,554,306 ) Less: Net loss attributable to non-controlling interests (163,576 ) (123,139 ) Loss from Continuing Operations $ (13,521,438 ) $ (50,431,167 ) Discontinued Operations Loss from discontinued operations - - NET LOSS ATTRIBUTABLE TO FUTURE FINTECH GROUP INC $ (13,521,438 ) $ (50,431,167 ) Earnings per share: Basic earnings per share from continued operation $ (0.42 ) $ (2.33 ) Basic earnings per share from discontinued operation - - $ (0.42 ) $ (2.33 ) Diluted Earnings per share: Diluted earnings per share from continued operation $ (0.42 ) $ (2.30 ) Diluted earnings per share from discontinued operation - - $ (0.42 ) $ (2.30 ) Weighted average number of shares outstanding Basic 33,996,279 21,636,146 Diluted 33,996,279 21,966,612 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
NUMERATOR FOR BASIC AND DILUTED EPS | ||
Net loss from continuing operations (numerator for EPS) | $ (13,521,438) | $ (174,010,421) |
Net (income) )loss from discontinued operations (numerator for EPS) | (11,707,493) | 4,013,367 |
Net loss allocated to Common Stockholders | $ (25,228,932) | $ (169,997,054) |
Loss per share: | ||
Basic loss per share from continued operations | $ (0.42) | $ (8.04) |
Basic loss per share from discontinued operations | (0.35) | 0.19 |
Basic loss per share from net loss | (0.79) | (7.85) |
Diluted loss per share: | ||
Diluted loss per share from discontinued operations | (0.42) | (7.92) |
Diluted loss per share from discontinued operations | (0.37) | 0.18 |
Diluted loss per share from net loss | $ (0.79) | $ (7.74) |
Weighted average Common Stock outstanding | 31,996,279 | 21,636,146 |
DENOMINATOR FOR BASIC AND DILUTED EPS | 31,996,279 | 21,966,612 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) | 12 Months Ended |
Dec. 31, 2019 | |
Buildings [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 20 years |
Buildings [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 30 years |
Machinery and equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Machinery and equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 10 years |
Furniture and office equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 3 years |
Furniture and office equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Motor Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Estimated useful lives | 5 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details Textual) | 1 Months Ended | 12 Months Ended | |||
Feb. 27, 2020 | Dec. 31, 2019USD ($) | Dec. 31, 2019CNY (¥) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Summary of Significant Accounting Policies (Textual) | |||||
Impairment loss | $ 2,750,000 | $ 25,190,000 | |||
Impairment cost, description | The Company has finished the building of an R&D center and an office building with a total investment of approximately $11.24 million (RMB 76.2 million), the Company has also purchased a fruit juice production line of approximately $19.02 million (RMB 129 million). As the Chinese government recently tightened environmental regulations, the project has been delayed and the construction has been stopped since early 2017. Since the Company's current cash cannot support the future input of this project and there is no forecasted cash flow from this project, the value of the construction in progress of this project was impaired. | ||||
Increase in bad debt expense | 5,230,000 | $ 16,309,999 | |||
Accounts receivables | 2,477 | 619,130,000 | |||
Shipping and handling expenses | 1,180 | 33,145 | |||
Advertising and promotional costs | 19,128 | 19,341 | |||
Foreign currency translation adjustments loss | $ 23,556,511 | 85,180,932 | |||
Lease term, useful life | 10 years | 10 years | |||
Net loss attributable to stockholders | $ (27,074,245) | (169,997,054) | |||
Cash and cash equivalents | 539,316 | 253,804 | $ 4,586,757 | ||
Net cash used in operating activities | (15,839,843) | $ (4,880,137) | |||
Lease assets and lease liabilities | $ 0 | ||||
Exchange rate, description | The exchange rate we used to convert RMB to USD was 6.98 and 6.86 at the balance sheet date of December 31, 2019 and December 31, 2018, respectively. The average exchange rate for the period has been used to translate revenues and expenses. The average exchange rate we used to convert RMB to USD was 6.90 and 6.62 for fiscal year 2019 and fiscal year 2018, respectively. Translation adjustments are reported separately and accumulated in a separate component of equity (cumulative translation adjustment). | The exchange rate we used to convert RMB to USD was 6.98 and 6.86 at the balance sheet date of December 31, 2019 and December 31, 2018, respectively. The average exchange rate for the period has been used to translate revenues and expenses. The average exchange rate we used to convert RMB to USD was 6.90 and 6.62 for fiscal year 2019 and fiscal year 2018, respectively. Translation adjustments are reported separately and accumulated in a separate component of equity (cumulative translation adjustment). | |||
Minimum [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Lease term, useful life | 40 years | 40 years | |||
Property and equipment ranges | 3.00% | ||||
Maximum [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Lease term, useful life | 50 years | 50 years | |||
Property and equipment ranges | 5.00% | ||||
RMB [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Government subsidies recognized | ¥ | ¥ 500,000 | ||||
HeDeTang HK [Member] | Subsequent Event [Member] | |||||
Summary of Significant Accounting Policies (Textual) | |||||
Discontinued operation, description | An unrelated third party and a company incorporated in the British Virgin Islands for a total price of RMB 0.6 million (approximately $85,714), pursuant to a Share Transfer Agreement entered into by the Seller and the Buyer on September 18, 2019 and approved at the special shareholders meeting of the Company on February 26, 2020. |
Inventories (Details)
Inventories (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Inventory Disclosure [Abstract] | ||
Raw materials and packaging | $ 24,578 | |
Finished goods | 37,269 | 2,502,803 |
Less: impairment loss | (33,675) | (2,464,364) |
Inventories | $ 3,594 | $ 63,017 |
Inventories (Details Textual)
Inventories (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Inventories (Textual) | ||
Inventory write-downs | $ 27,247 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Subtotal | $ 36,958 | $ 88,302,711 |
Less: accumulated depreciation | (11,902) | (41,420,859) |
Less: Impairment loss | (7,201) | (44,545,816) |
Net property and equipment | 17,855 | 2,336,036 |
Machinery and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 32,702,621 | |
Furniture and office equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 36,958 | 368,875 |
Motor vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 355,820 | |
Buildings [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 54,689,750 | |
Construction in progress [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | $ 185,646 |
Property, Plant and Equipment_3
Property, Plant and Equipment (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
General and administration expenses [Member] | ||
Property Plant and Equipment (Textual) | ||
Depreciation expense | $ 6,051 | $ 2,930,000 |
Cost of sales [Member] | ||
Property Plant and Equipment (Textual) | ||
Depreciation expense | $ 0 | $ 337,198 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Cost | $ 5,847,008 | $ 24,003,243 |
Less: Accumulated amortization | (574,996) | (2,556,898) |
Less: Impairment Loss | (6,895,078) | |
Intangible assets net | $ 5,272,012 | $ 14,551,266 |
Intangible Assets (Details Text
Intangible Assets (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Jan. 23, 2018 | |
Intangible Assets (Textual) | |||
Ownership interest | 60.00% | ||
Aggregate purchase price | $ 9,600,000 | ||
Intangible asset, description | Management has determined that above acquired intangible assets were evaluated at the par value of the common stocks issued, or $1,200. | ||
Amortization expense | $ 120,000 | $ 6,500,000 | |
Minimum [Member] | |||
Intangible Assets (Textual) | |||
term lease | 40 years | ||
Maximum [Member] | |||
Intangible Assets (Textual) | |||
term lease | 50 years |
Related Party Transaction (Deta
Related Party Transaction (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Loan amount | $ 3,400,000 |
Yongke Xue [Member] | |
Loan amount | $ 28,539 |
Relationship | Chairman of the Company |
Note | Loan payable |
Kai Xu [Member] | |
Loan amount | $ 26,808 |
Relationship | Chief Operating Officer of the Company |
Note | Payable to employee |
Zeyao Xue [Member] | |
Loan amount | $ 310,746 |
Relationship | Son of the Chairman of the Company and a shareholder of the Company Chief Operating Officer of the Company |
Note | Loan payable |
Shanchun Huang [Member] | |
Loan amount | $ 71,672 |
Relationship | Chief Executive Officer of the Company |
Note | Loan payable |
Shenzhen TianShunDa Equity Investment Fund Management Co., Ltd., [Member] | |
Loan amount | $ 573,142 |
Relationship | Holds 26.36% of equity shares of SkyPeople China |
Note | Interest free loan |
InUnion Chain Ltd. (''INU'') [Member] | |
Loan amount | $ 209,957 |
Relationship | The Company is the 10% equity shareholder of INU |
Note | Accounts payables |
Zhi Yan [Member] | |
Loan amount | $ 40,710 |
Relationship | Chief Technology Officer of the Company |
Note | Loan payable |
Jing chen [Member] | |
Loan amount | $ 6,527 |
Relationship | Chief Financial Officer of the Company |
Note | Payable to employee |
Related Party Transaction (De_2
Related Party Transaction (Details 1) | 12 Months Ended | |
Dec. 31, 2019USD ($) | ||
Shaanxi Chunlv Ecological Agriculture Co. Ltd. [Member] | ||
Loan amount | $ 3,356,070 | |
Relationship | Holds 20.0% interest in CCM logistics | |
Note | Interest free loan | [1] |
Quangoutong Commercial Holdings (Xi'an) Co., Ltd ("Quangoutong") [Member] | ||
Loan amount | $ 22,935 | |
Relationship | Shaanxi Fullmart Convenient Chain Supermarket Co., Ltd. ("Fullmart") holds 16.67% equity of its subsidiary. The subsidiary is 83.33% owned by Quangoutong | |
Note | Service fee due | |
Shaanxi Quangou Convenient Island Co. Ltd. [Member] | ||
Loan amount | $ 23,828 | |
Relationship | Fullmart holds 33.33% its equity | |
Note | Interest free loan | [1] |
[1] | The interest free loans have been approved by the Company's Audit Committee. |
Related Party Transaction (De_3
Related Party Transaction (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Related Party Transaction (Textual) | ||
Related party transaction | $ 1,270,000 | |
Related party loan receivable | 1,550,000 | |
Due from the related parties | 3,400,000 | |
InUnion [Member] | ||
Related Party Transaction (Textual) | ||
Purchased health insurance | $ 209,958 | |
Equity shareholder, percentage | 10.00% | |
Equity shareholder, shares | ||
Shaanxi Fullmart Convenient Chain Supermarket [Member] | ||
Related Party Transaction (Textual) | ||
Fruit beverage sales | $ 8,810 | |
Accounts receivable balances | $ 0 |
Income Tax (Details)
Income Tax (Details) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax (Textual) | ||
Percentage of effective income tax rate | 0.00% | 0.00% |
Percentage of enterprise income tax rate | 25.00% | |
Income tax, description | Effective on January 1, 2008, the PRC Enterprise Income Tax Law, EIT Law, and Implementing Rules imposed a unified enterprise income tax rate of 25% on all domestic-invested enterprises and foreign-invested enterprises in the PRC, unless they qualify under certain limited exceptions. |
Impairment Loss (Details)
Impairment Loss (Details) | 1 Months Ended | 12 Months Ended | ||
Nov. 23, 2015 | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2018CNY (¥) | |
Impairment loss (Textual) | ||||
Impairment loss | $ 2,750,000 | $ 25,190,000 | ||
Impairment cost, description | The Company has finished the building of an R&D center and an office building with a total investment of approximately $11.24 million (RMB 76.2 million), the Company has also purchased a fruit juice production line of approximately $19.02 million (RMB 129 million). As the Chinese government recently tightened environmental regulations, the project has been delayed and the construction has been stopped since early 2017. Since the Company's current cash cannot support the future input of this project and there is no forecasted cash flow from this project, the value of the construction in progress of this project was impaired. | The Company has finished the building of an R&D center and an office building with a total investment of approximately $11.24 million (RMB 76.2 million), the Company has also purchased a fruit juice production line of approximately $19.02 million (RMB 129 million). As the Chinese government recently tightened environmental regulations, the project has been delayed and the construction has been stopped since early 2017. Since the Company's current cash cannot support the future input of this project and there is no forecasted cash flow from this project, the value of the construction in progress of this project was impaired. | ||
RMB [Member] | ||||
Impairment loss (Textual) | ||||
Total estimated investment | ¥ | ¥ 294,000,000 | |||
Yingkou [Member] | ||||
Impairment loss (Textual) | ||||
Impairment loss | $ 4,360,000 | |||
Shaanxi Guoweimei Kiwi Deep Processing Co., Ltd. [Member] | ||||
Impairment loss (Textual) | ||||
Impairment loss | 11,510,000 | |||
Suizhong project [Member] | ||||
Impairment loss (Textual) | ||||
Impairment loss | 25,680,000 | |||
Yidu project [Member] | ||||
Impairment loss (Textual) | ||||
Impairment loss | $ 32,680,000 | |||
Impairment cost, description | The Company started the construction of the Yidu project, which was to establish the distribution center and the deep processing zone on the project land of approximately 280 mu, or 46 acre. As the Chinese government recently tightened environment regulations, the project has been delayed. Since the Company's current cash cannot support the future input of this project and there is no forecasted cash flow from this project, the value of the construction in progress of this project was impaired. |
Risks and Uncertainties (Detail
Risks and Uncertainties (Details) - Customers | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Risk an uncertainties sales | There were two customers, Chengdu Hongkor Electromechanical Equipment Co., Ltd. ("HongKor"), and Qifeng Fruit Industry Co., Ltd., who accounted for 40.96% and 10.17% respectively of the Company's sales for the year ended December 31, 2018, | |
Net sales | 15.60% | 61.56% |
Purchases for suppliers | 10.00% | |
Number of customers | 2 | |
Supplier One [Member] | ||
Purchases for suppliers | 14.42% | |
First two largest suppliers [Member] | ||
Purchases for suppliers | 0.99% | |
Sales [Member] | ||
Concentration risk, percentage | 10.00% |
Share Based Compensation (Detai
Share Based Compensation (Details) - shares | Mar. 13, 2018 | Dec. 21, 2018 | Dec. 31, 2019 |
Share Based Payments (Textual) | |||
Unrestricted common stock | 250,000 | ||
2017 Omnibus Equity Plan [Member] | |||
Share Based Payments (Textual) | |||
Common stock shares | 1,300,000 | ||
Share based payments, description | The Company approved the issuance of 1,300,000 shares of the Company’s unrestricted common stock to seven of the Company’s employees pursuant to our 2017 Omnibus Equity Plan. The Company recorded an expense of $13,000 in the fourth quarter of fiscal year 2018 under the 2017 Omnibus Equity Plan, reflecting a par value of $0.001 per share of the Company’s common stock. The shares were issued accordingly to these employees in May and June of 2019. |
Common Stocks Issued in Conne_2
Common Stocks Issued in Connection with the Convertible Notes (Details) - USD ($) | Jan. 15, 2020 | Jan. 06, 2020 | Nov. 13, 2019 | Nov. 01, 2019 | Oct. 17, 2019 | Oct. 15, 2019 | Jun. 05, 2019 | May 13, 2019 | May 02, 2019 | May 03, 2018 | Apr. 06, 2018 | Jan. 05, 2018 | Nov. 03, 2017 | Nov. 02, 2017 | Nov. 26, 2019 | Nov. 19, 2019 | Oct. 25, 2019 | Oct. 23, 2019 | Jun. 27, 2019 | Mar. 26, 2019 | Oct. 19, 2018 | Jan. 23, 2018 | Dec. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 30,000 | 650,000 | 5,000,000 | ||||||||||||||||||||||
Purchase price of shares common stock | 2,500,000 | ||||||||||||||||||||||||
Interest rate | 8.00% | ||||||||||||||||||||||||
Second cash payment from Purchaser | $ 500,000 | ||||||||||||||||||||||||
Outstanding share percentage | 125.00% | ||||||||||||||||||||||||
Conversion price | $ 3 | $ 3 | |||||||||||||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | ||||||||||||||||||||||
Agreement, description | The parties agreed, in the event Lender delivers a Redemption Notice to the Company and the redemption amount set forth therein is not paid in cash to Lender within three (3) trading days, then the applicable redemption amount shall be increased by 25% (the "First Adjustment," and such increase to the redemption amount, the "First Adjusted Redemption Amount"). In the event the First Adjusted Redemption Amount is not paid within three (3) trading days after the date of First Adjustment, then the First Adjusted Redemption Amount shall be increased in accordance with the following formula: $0.75 divided by the lowest closing trade price of the Common Stock of the Company during the twenty (20) trading days prior to the date of the Second Adjustment and the resulting quotient multiplied by the First Adjusted Redemption Amount (the "Second Adjustment," and such increase to the First Adjusted Redemption Amount, the "Second Adjusted Redemption Amount"), provided, however, that such formula shall only be applied if the resulting quotient is greater than one (1) and such formula shall in no event be used to reduce the First Adjusted Redemption Amount. Upon payment in cash of the First Adjusted Redemption Amount or Second Adjusted Redemption Amount, the outstanding balance of the Note will be reduced by the original amount set forth in the Redemption Notice. The Company also agreed that during each calendar month, beginning in the month of October 2019, it will reduce the outstanding balance of the Note by at least $100,000 and if the outstanding balance is reduced by more than $100,000 in a given month, then the portion of the balance reduction amount that exceeds $100,000 may be counted toward the minimum balance reduction requirement in the next month or months. On November 6, 2019, the Lender issued a Redemption Notice, and the premium was agreed to be increased by $172,583. On November 26, 2019, the Lender issued another Redemption Notice, and the premium was agreed to be increased by $170,407. On January 21, 2020, the Lender issued another Redemption Notice, and the premium was agreed to be increased by $173,276. | ||||||||||||||||||||||||
Unrestricted common stock | 250,000 | ||||||||||||||||||||||||
Original principal amount | $ 9,600,000 | ||||||||||||||||||||||||
Reits (Beijing) Technology Co. Ltd. [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 880,580 | ||||||||||||||||||||||||
Agreement, description | (i) GlobalKey shall provide the hardware and network requirements for the trial deployment of the System, (ii) Reits shall provide training of GlobalKey's staff in the use and operation of the System, and (iii) for a period of one year from the System delivery date and for no additional charge, Reits shall provide ongoing System maintenance and technical support (the "Free Maintenance Period"). Following the completion of the Free Maintenance Period, GlobalKey may elect to engage Reits for ongoing maintenance and technical support. Under the Service Agreement, GlobalKey shall pay Reits aggregate consideration of RMB 13 million ($2.07 million), of which RMB 9.1 million ($1.45 million) may be paid in shares of the Company's common stock, par value $0.001 per share (the "Common Stock"), at a per share price equal to the average of the Common Stock's closing prices over the 5 trading days prior to the date of the Agreement, or $1.554 per share (the "Share Payment"). The exchange rate between US dollar and RMB for the payment is 1:6.65. The Share Payment was made within 15 business days of the date of the Service Agreement, and the remaining Service Agreement consideration shall be paid by GlobalKey in accordance with the schedule described in the Service Agreement. The Company paid RMB 0.88 million ($0.14 million) and RMB 0.79 million ($0.12 million) in cash to Reits in the first and second quarters of 2018, respectively. | ||||||||||||||||||||||||
DCON [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Ownership interest percentage, description | 60.00% ownership interest. | ||||||||||||||||||||||||
Peng Youwang [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 600,000 | ||||||||||||||||||||||||
Purchase price per share | $ 8 | ||||||||||||||||||||||||
Purchase price of shares common stock | 1,200,000 | ||||||||||||||||||||||||
Fair value of options to purchase common stock | $ 9,600,000 | ||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Ownership interest percentage, description | The Agreement also contains customary representations and warranties regarding the Transfer Assets and the ownership thereof, and covenants regarding the parties' cooperation. DigiPay and Peng further agreed to establish a Japanese operating company for the Transfer Assets, of which DigiPay holds a 60.00% ownership interest and Peng's designee holds a 40.00% ownership interest. | ||||||||||||||||||||||||
Share Purchase Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 11,362,159 | ||||||||||||||||||||||||
Purchase price per share | $ 16,440,000 | ||||||||||||||||||||||||
Purchase price of shares common stock | 11,362,159 | ||||||||||||||||||||||||
Acquisition Agreements [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 7,111,599 | ||||||||||||||||||||||||
Shaanxi [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Description of acquisition agreements | As of the Agreement Date, the book balance for the principal was RMB 72.37 million the interest was RMB 138.04 million, the total of credit including the principal and the interest was RMB 210.41 million, and there was no effective guarantee or pledged assets to secure this debt. | ||||||||||||||||||||||||
Shaanxi Youyi Co., Ltd [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Description of acquisition agreements | As of the Agreement Date, the book balance for the principal was RMB 45.35 million, the interest was RMB 71.22 million, and the total credit balance including the principal and the interest was RMB 116.57 million, all of which was guaranteed by a third party company. | ||||||||||||||||||||||||
Xi'an Yanliang Economic Development Co., Ltd [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Description of acquisition agreements | As of the Agreement Date, the book balance for the principal was RMB 6.35 million, the interest was RMB 9.83 million, and the total of credit including the principal and the interest was RMB 16.18 million, which is secured by certain land use rights. | ||||||||||||||||||||||||
Seller [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 3,409,466 | ||||||||||||||||||||||||
Seller One [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 3,323,225 | ||||||||||||||||||||||||
Seller Two [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 378,908 | ||||||||||||||||||||||||
Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 1,493,333 | ||||||||||||||||||||||||
Securities Purchase Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Secured Convertible Promissory Note | $ 1,070,000 | ||||||||||||||||||||||||
Original issue discount | 50,000 | ||||||||||||||||||||||||
Purchaser fees and costs | 20,000 | ||||||||||||||||||||||||
Initial cash payment | $ 500,000 | ||||||||||||||||||||||||
Interest rate | 8.00% | ||||||||||||||||||||||||
Interest income | $ 3,818 | ||||||||||||||||||||||||
Ninth Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Original principal amount | $ 140,000 | ||||||||||||||||||||||||
Conversion of stock | 186,666 | ||||||||||||||||||||||||
Eighth Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Original principal amount | $ 145,000 | ||||||||||||||||||||||||
Conversion of stock | 193,333 | ||||||||||||||||||||||||
Third Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Original principal amount | $ 145,000 | ||||||||||||||||||||||||
Conversion of stock | 193,333 | ||||||||||||||||||||||||
Fourth Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Original principal amount | $ 175,000 | ||||||||||||||||||||||||
Conversion of stock | 233,333 | ||||||||||||||||||||||||
Fifth Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Original principal amount | $ 125,000 | ||||||||||||||||||||||||
Conversion of stock | 166,667 | ||||||||||||||||||||||||
First Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Original principal amount | $ 100,000 | ||||||||||||||||||||||||
Conversion of stock | 133,333 | ||||||||||||||||||||||||
Second Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Original principal amount | $ 300,000 | ||||||||||||||||||||||||
Conversion of stock | 400,000 | ||||||||||||||||||||||||
Six Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Original principal amount | $ 125,000 | ||||||||||||||||||||||||
Conversion of stock | 166,667 | ||||||||||||||||||||||||
Seventh Exchange Agreement [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock, par value | $ 0.001 | ||||||||||||||||||||||||
Description of acquisition agreements | 1) Shaanxi Chunlv Ecological Agriculture Co. Ltd. agreed to transfer all of its credit rights of principal and interest owed by Xi'an Tongji Department Store Co., Ltd. to Hedetang. As of the Agreement Date, the book balance of the principal was RMB 23.63 million, the interest was RMB 38.28 million, and the total credit balance, including the principal and the interest, was RMB 61.91 million, of which the RMB 19.76 million credit was guaranteed by a third party company. | ||||||||||||||||||||||||
Agreement, description | On November 2, 2017 (the "Agreement Date"), a wholly-owned indirect subsidiary of the Company, Hedetang Foods (China) Co., Ltd. ("Hedetang"), entered into a series of Creditor's Rights Transfer Agreements (collectively, the "Acquisition Agreements") with each of Shaanxi Chunlv Ecological Agriculture Co. Ltd., Shaanxi Boai Medical Technology Development Co., Ltd., and Shaanxi Fu Chen Venture Capital Management Co. Ltd. (collectively, the "Sellers"). The Sellers holds 70% of the equity shares of Shenzhen TianShunDa Equity Investment Fund Management Co., Ltd., which holds 26.36% of equity shares of SkyPeople China. Pursuant to the Acquisition Agreements, Hedetang agreed to purchase certain creditor's rights associated with companies located in the PRC, for an aggregate purchase price of RMB 181.01 million (approximately $27.34 million), of which RMB 108.60 million (approximately $16,44 million was paid in cash and RMB 72,40 million approximately $10.94 million was paid in shares of common stock of the Company based on the average of the closing prices of Future FinTech's common stock over the five trading days preceding the date of the Acquisition Agreements. | ||||||||||||||||||||||||
Original principal amount | $ 150,000 | ||||||||||||||||||||||||
Conversion of stock | 200,000 | ||||||||||||||||||||||||
Hao [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 500,000 | ||||||||||||||||||||||||
Feng [Member] | |||||||||||||||||||||||||
Issuance of Common Stock and Warrants (Textual) | |||||||||||||||||||||||||
Common stock shares, issued | 150,000 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | ||
REVENUES | $ 330,195 | $ 756,838 |
COST OF SALES | 315,737 | 891,154 |
GROSS PROFIT | 14,459 | (134,316) |
OPERATING EXPENSES: | ||
General and administrative | 2,994,965 | 10,308,627 |
Selling expenses | 172,449 | 174,097 |
Bad debt expenses | 3,026,472 | |
Impairment loss | 133,631,129 | |
Total | 6,193,885 | 144,113,852 |
OTHER INCOME (EXPENSE) | ||
Interest income | 116 | |
Interest expense | (7,300,070) | (1,721,012) |
other income(expenses) | 90,149 | 6,770,498 |
Total | (7,209,805) | (5,050,147) |
Loss from discontinued operations before income tax | (13,389,231) | (139,198,021) |
Income tax provision | 31 | |
Loss from discontinued operation before Minority Interest | (13,389,231) | (139,198,052) |
Less: Net loss attributable to non-controlling interests | (1,681,738) | 15,618,798 |
LOSS FROM DISCONTINUED OPERATION | $ (11,707,493) | $ (123,579,254) |
Discontinued Operations (Deta_2
Discontinued Operations (Details 1) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Discontinued Operations and Disposal Groups [Abstract] | ||
Cash | $ 123,087 | $ 220,342 |
Accounts receivable | 11,720 | 73,244 |
Other receivables | 1,861 | 15,381,465 |
Inventory | 454,269 | 63,017 |
Advances to suppliers and other current assets | 97,539 | |
Property and equipment, net | 1,176,163 | 2,276,704 |
Right of use assets | 57,571,254 | |
Intangible assets, net | 15,347,535 | 15,968,625 |
Amount due from related parties | 17,989,358 | |
Total assets related to discontinued operations | 92,772,786 | 33,933,396 |
Accounts payable | 2,084,735 | 9,002,384 |
Accrued expenses | 81,279,952 | 78,644,119 |
Advances from customers | 815,382 | 772,078 |
Short-term bank loans | 37,245,139 | 5,828,185 |
Lease liabilities | 60,613,970 | |
Amount due from related parties | 14,222,570 | |
Long-term loan | 14,222,570 | 32,450,867 |
Total liabilities related to discontinued operations | $ 196,261,748 | $ 126,697,633 |
Discontinued Operations (Deta_3
Discontinued Operations (Details Textual) - USD ($) | 1 Months Ended | 12 Months Ended | |
Sep. 18, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Discontinued Operation (Textual) | |||
Loss from discontinued operations | $ (11,707,493) | $ (123,579,254) | |
Transfer agreement, description | Pursuant to the terms of the Agreement, the Buyer purchased 100% ownership of HeDeTang HK, which value is primarily derived from HeDeTang HK's wholly-owned subsidiary HeDeJiaChuan Holdings Co., Ltd. and 73.41% owned subsidiary SkyPeople Juice Group Co., Ltd., for a total price of RMB 600,000 (approximately $85,714) (the "Sale Transaction"). The Sale Transaction was closed on February 27, 2020. In accordance with ASC Topic 205, Presentation of Financial Statement Discontinued Operations ("ASC Topic 205"), the Company presented the operation results from HeDeTang HK's and subsidiaries as a discontinued operation, as the Company believed that no continued cash flow would be generated by the discontinued component and that the Company would have no significant continuing involvement in the operations of the discontinued component. The total assets of HeDeTang HK was $64.37 million as of December 31,2019 and the total liabilities of HeDeTang HK was $196.87 million as of December 31, 2019. |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Reportable segment revenue | $ 1,332 | $ 132 |
Inter-segment loss | (377) | |
Revenue from external customers | 955 | 132 |
Segment gross profit | 491 | 48 |
CCM Shopping Mall Membership [Member] | ||
Reportable segment revenue | 542 | |
Inter-segment loss | ||
Revenue from external customers | 542 | |
Segment gross profit | 401 | |
Sales of Goods [Member] | ||
Reportable segment revenue | 378 | |
Inter-segment loss | ||
Revenue from external customers | 378 | |
Segment gross profit | 72 | |
Others [Member] | ||
Reportable segment revenue | 412 | 132 |
Inter-segment loss | (377) | |
Revenue from external customers | 35 | 132 |
Segment gross profit | $ 18 | $ 48 |
Segment Reporting (Details Text
Segment Reporting (Details Textual) | 12 Months Ended |
Dec. 31, 2019Segment | |
Segment Reporting (Textual) | |
Number of reportable segments | 3 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Jun. 10, 2019 | Apr. 11, 2019USD ($) | Oct. 08, 2018USD ($) | Mar. 21, 2018USD ($) | Aug. 10, 2017USD ($) | Mar. 08, 2016USD ($) | May 04, 2015USD ($) | Dec. 26, 2019 | Nov. 30, 2019 | Nov. 30, 2018 | Sep. 05, 2018 | Jul. 19, 2018 | Dec. 31, 2017 | Oct. 31, 2017 | Aug. 31, 2017USD ($) | Jul. 31, 2017 | Dec. 31, 2016USD ($) | Dec. 19, 2016 | Jan. 31, 2016 | Dec. 23, 2015USD ($) | Jun. 29, 2015USD ($) | Apr. 30, 2015USD ($) | Jul. 31, 2014 | Sep. 30, 2018USD ($) | Dec. 31, 2019USD ($)Segment | Dec. 31, 2018USD ($) | Jun. 30, 2018USD ($) | May 09, 2016USD ($) |
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Payments to suppliers | $ 5,800,000 | $ 5,800,000 | ||||||||||||||||||||||||||
Number of suppliers | Segment | 5 | |||||||||||||||||||||||||||
Loan borrowed | $ 32,450,867 | |||||||||||||||||||||||||||
Lawsuit expenses and liability | $ 5,800,000 | $ 5,800,000 | ||||||||||||||||||||||||||
Litigation description | In August 2017, Huaxing filed a lawsuit and the court ruled that Shaanxi Qiyiwangguo owed Huaxing RMB 203,742 (approximately $29,743) in July 2018. | Shaanxi Qiyiwangguo filed a lawsuit against Bailutong with Zhouzhi county People's Court, and the Court issue the verdict in February 2018 that: (1) the transportation contract between Shaanxi Qiyiwangguo and Bailutong was terminated; and (2) Bailutong owed RMB 0.20 million (approximately $0.03 million) to Qiyiwangguo for the loss of Shaanxi Qiyiwangguo. Bailutong appealed the case to Xi'an Intermediate People's Court. Xi'an Intermediate People's Court rejected the appeal and upheld the original verdict. | ||||||||||||||||||||||||||
Action taken by court under litigation, description | On December 26, 2019, Yanta District Court of Xi'an City (the "Court") ordered SkyPeople China to pay Shaanxi Overseas Investment the preferred share redemption amount of RMB 5 million plus penalty which is calculated based upon the RMB 5 million at a rate of 24% a year. The Court also ruled that Shaanxi Overseas Investment may sell the pledged shares owned by Shenzhen Tianshun Da as the repayment for SkyPeople China and Hongkong Xue shall also assume the repayment obligation as guarantor. | The Court sold the real estate property pledged by Xiujun Wang for RMB 1.17 million. Because the real estate property is Xiujun Wang's primary home, the Court allocated RMB 0.12 million to Xiujun Wang as transition home leasing fee and deducted outstanding mortgage payments, and the remaining amount was delivered to Beijing Bank as the repayment. The Court has also made inquiries to Beijing Bank as to whether it is willing to accept the pledged real estate property of Shaanxi Boai as the repayment of the outstanding loan for the amount of RMB 27.93 million but Beijing Bank has refused to take the real property as repayment of the loan and the enforcement action has been terminated by the Court on December 18, 2018. As of December 31, 2019, SkyPeople China still owe the unpaid amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020 | The Huludao Court accepted the case. The Company has been disputing the interest rate of the loan with Suizhong Branch, and has not repaid the loan to date. Wonder Fruit believes that the interest charged by Suizhong Branch is 100.00% higher than the base rate set by People's Bank of China and is not consistent with the China People's Bank's base interest and floating rate. The Huludao Court has seized land use rights, buildings and equipment of Wonder Fruit that were pledged as guarantee for the loan and organized two auction sales for these assets in January and February of 2018, but both auction sales were unsuccessful in finding a buyer. On July 19, 2018, the Court issued a verdict ordering Huludao Wonder to transfer its land use rights, building, equipment, electronic and transportation assets to Zuizhong Branch as payment of the outstanding principal, auction and evaluation fees and some interest of the loan for RMB 42.64 million (approximately $6.22 million). As of December 31, 2019, there was RMB 11.95 million (approximately $1.74 million) in interest on the loan unpaid. | Shaanxi Guoweimei Kiwi Deep Processing Co. Ltd ("Guoweimei"), entered into a construction agreement with Shaanxi Fangyuan construction co., Ltd. ("Fangyuan") in July 2013. On October 8, 2018, Fangyuan filed a lawsuit and requested that Guoweimei pay a project construction fee plus penalty of RMB 56.32 million (approximately $8.22 million). On June 10, 2019, Baoji Intermediate People's Court issued a verdict that Guoweimei just pay RMB 41.58 million (approximately $6.07 million) plus penalty to Fangyuan, and Fangyuan will enjoy preferential right for the projects in processing zone of National Wholesale and Trading Center in Mei County for Kiwi Fruits developed by Guoweimei. | ||||||||||||||||||||||||
Repayment of bank loan, plus interest | $ (1,503,793) | |||||||||||||||||||||||||||
Property compensate for debt | $ 1,780,000 | |||||||||||||||||||||||||||
Lessees repay | $ 7,270,000 | |||||||||||||||||||||||||||
Investment Development, description | According to the agreement, Shaanxi Overseas Investment agreed to invest RMB 5 million for the preferred shares of SkyPeople China with an annual interest rate of 2.38%. Shenzhen Tian Shun Da pledged 1.17% of the shares SkyPeople China that it owned and Hongke Xue provided guarantee for the performance of agreement by SkyPeople China. SkyPeople China failed to make the interests payment and Shaanxi Overseas Investment filed the lawsuit for breach of agreement. | |||||||||||||||||||||||||||
Bank of Beijing [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Loan borrowed | $ 4,360,000 | |||||||||||||||||||||||||||
Bank of Beijing [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Loan borrowed | 30,000,000 | |||||||||||||||||||||||||||
Loan payable to Bank of Beijing [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Loan borrowed | $ 2,500,000 | 30,000,000 | ||||||||||||||||||||||||||
China construction bank [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Loan borrowed | $ 3,500,000 | |||||||||||||||||||||||||||
China construction bank [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Loan borrowed | $ 22,900,000 | |||||||||||||||||||||||||||
RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Payments to suppliers | 39,600,000 | |||||||||||||||||||||||||||
Property compensate for debt | $ 12,210,000 | |||||||||||||||||||||||||||
Lessees repay | 50,000,000 | |||||||||||||||||||||||||||
Leasing fee | $ 50,000,000 | |||||||||||||||||||||||||||
Construction and decoration fee, description | Shaanxi Wanyuan Construction Co., Ltd. ("Wanyuan") filed a lawsuit with Shaanxi Baoji Municipal Intermediate People's Court (the "Baoji Court") against Guoweimei for repayment of construction and decoration costs of RMB 55.07 million pursuant to a Construction and Decoration Agreement entered by the parties in May 2017. In July, 2019, the Baoji Court ordered Guoweimei to pay construction and decoration costs of RMB 55.07 million (approximately $7.98 million) to Wanyuan, plus interest. As of December 31, 2019, Guoweimei has not repaid the amount. Guoweimei was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. | |||||||||||||||||||||||||||
RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Repay the loan | $ 3,000,000 | |||||||||||||||||||||||||||
Shaanxi Guoweimei Kiwi Deep Processing Co., Ltd. [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Project payment with penalty | $ 8,220,000 | |||||||||||||||||||||||||||
Shaanxi Guoweimei Kiwi Deep Processing Co., Ltd. [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Project payment with penalty | $ 56,320,000 | |||||||||||||||||||||||||||
Cinda Shaanxi Branch [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Line of credit, description | Cinda Shaanxi Branch agreed to provide a RMB 100 million credit line on a rolling basis to the two suppliers and the Company agreed to pay its accounts payables to the two suppliers directly to Cinda Shaanxi Branch and provided guarantees for the two suppliers. | |||||||||||||||||||||||||||
Skypeople China [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Repayments of debt | 13,900,000 | |||||||||||||||||||||||||||
Skypeople China [Member] | Shaanxi Guoweimei Kiwi Deep Processing Co., Ltd. [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Litigation description | Baoji Intermediate People's Court issued a verdict that Guoweimei just pay RMB 41.58 million (approximately $6.07 million) plus penalty to Fangyuan, and Fangyuan will enjoy preferential right for the projects in processing zone of National Wholesale and Trading Center in Mei County for Kiwi Fruits developed by Guoweimei. | |||||||||||||||||||||||||||
Repayments of debt | $ 2,130,000 | |||||||||||||||||||||||||||
Working Capital Loan Repayment | $ 3,920,000 | |||||||||||||||||||||||||||
Skypeople China [Member] | Shaanxi Guoweimei Kiwi Deep Processing Co., Ltd. [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Working Capital Loan Repayment | $ 26,900,000 | |||||||||||||||||||||||||||
China construction bank [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Action taken by court under litigation, description | The Court has seized certain parking space and land use rights pledged by Xiujun Wang and Boai and sold the land use right pledged by Boai in auction for approximately RMB 24,835,790 as repayment to China Construction Bank. The Court also seized certain land use rights pledged by Yingkou Trusty Fruits Co., Ltd., but the auction sale for those rights was not successful. SkyPeople China currently is in discussions with China Construction Bank on the payment terms and the final amount. | |||||||||||||||||||||||||||
Repayments of debt | $ 4,590,000 | |||||||||||||||||||||||||||
China construction bank [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Repayments of debt | $ 30,000,000 | |||||||||||||||||||||||||||
Suizhong Branch of Huludao Banking Co Ltd [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Interest rate, description | The Huludao Court accepted the case. The Company has been disputing the interest rate of the loan with Suizhong Branch, and has not repaid the loan to date. Wonder Fruit believes that the interest charged by Suizhong Branch is 100.00% higher than the base rate set by People's Bank of China and is not consistent with the China People's Bank's base interest and floating rate. | |||||||||||||||||||||||||||
Action taken by court under litigation, description | (i) the Land Lease Agreement was thereby terminated; (ii) Shaanxi Qiyiwangguo shall pay Xi'an Shanmei the outstanding leasing fee RMB 0.21 million (approximately $0.03 million) and (iii) Shaanxi Qiyiwangguo shall return the 29.30 mu industrial use land to Xi'an Shanmei. Shaanxi Qiyiwangguo appealed the decision to the Xi'an Intermediate People's Court on the basis that: (x) the land use right was a capital contribution by Xi'an Shanmei for a shareholder of Shaanxi Qiyiwangguo who is also the sole shareholder of Xi'an Shanmei and the Land Lease Agreement was invalid and has no legal effect; (y) Zhouzhi Court did not schedule the hearing for the count claims filed by Shaanxi Qiyiwangguo; and (z) Zhouzhi Court violated certain civil procedures during the trial of the case. | |||||||||||||||||||||||||||
Repayment of bank loan, plus interest | 5,810,000 | |||||||||||||||||||||||||||
Suizhong Branch of Huludao Banking Co Ltd [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Repayment of bank loan, plus interest | $ 40,000,000 | |||||||||||||||||||||||||||
Cinda Capital Financing Co. Ltd. [Member] | Skypeople China [Member] | Shaanxi Guoweimei Kiwi Deep Processing Co., Ltd. [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Amount claimed under lawsuit | 12,350,000 | |||||||||||||||||||||||||||
Leasing fees not yet due | $ 9,300,000 | |||||||||||||||||||||||||||
Leasing fees due | 3,050,000 | |||||||||||||||||||||||||||
Cinda Capital Financing Co. Ltd. [Member] | Skypeople China [Member] | Shaanxi Guoweimei Kiwi Deep Processing Co., Ltd. [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Amount claimed under lawsuit | $ 84,970,000 | |||||||||||||||||||||||||||
Leasing fees not yet due | 63,980,000 | |||||||||||||||||||||||||||
Leasing fees due | $ 21,000,000 | |||||||||||||||||||||||||||
Shaanxi Fangtian Decoration Co. Ltd. [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Borrowed amount from Fangtian | 510,000 | |||||||||||||||||||||||||||
Repayment of bank loan, plus interest | $ 590,000 | |||||||||||||||||||||||||||
Shaanxi Fangtian Decoration Co. Ltd. [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Repayment yuan and interests | 3,500,000 | |||||||||||||||||||||||||||
Repayment of bank loan, plus interest | $ 400,000 | |||||||||||||||||||||||||||
Shaanxi Fangtian Decoration Co. Ltd. [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Borrowed amount from Fangtian | $ 3,500,000 | |||||||||||||||||||||||||||
Sky people China [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Repayments of debt | $ 3,630,000 | |||||||||||||||||||||||||||
Sky people China [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Repayments of debt | $ 25,000,000 | |||||||||||||||||||||||||||
Skypeople China [Member] | RMB [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Repayments of debt | $ 27,930,000 | |||||||||||||||||||||||||||
Shaanxi Zhongkun [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Construction and decoration fee, description | The Court issued a civil judgement in November 2018, ordering Hedetang to pay project funds of RMB 1.65 million (approximately $0.24 million) to Zhongkun, plus interest. On April 19, 2020, the Court issued a verdict to terminate the enforcement because assets of Hedetang had already been seized by Xi'an Yanta District People's Court and Baoji Intermediate People's Court, and there were no other assets for enforcement. Currently the Company is still liable for the unpaid amount and the interest. | |||||||||||||||||||||||||||
Andrew Chien [Member] | ||||||||||||||||||||||||||||
Commitments and Contingencies (Textual) | ||||||||||||||||||||||||||||
Action taken by court under litigation, description | The complaint, Mr. Chien made several claims, most of which attempt to hold the Company liable under novel legal theories that relate back to an alleged breach of a consulting agreement between SkyPeople China and Chien from August 2006. Mr. Chien claimed approximately $257,000 damages and interest plus 2.00% of the Company's then-outstanding shares. |
Variable Interest Entities (Det
Variable Interest Entities (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Variable Interest Entities (Textual) | |
Term of agreement | 10 years |
Unaudited Condensed Pro Forma_3
Unaudited Condensed Pro Forma Financial Statements (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
CURRENT ASSETS | |||
Cash and cash equivalents | $ 539,316 | $ 253,804 | $ 4,586,757 |
Accounts receivable, net of allowance of $16,127,000 as of December 31, 2019 and $15,650,217 as of December 31, 2018, respectively | 4,954 | 73,244 | |
Other receivables, net | 7,489 | 23,774,163 | |
Inventories | 3,594 | 63,017 | |
Advances to suppliers and other current assets | 1,668,847 | ||
TOTAL CURRENT ASSETS | 94,996,986 | 24,164,227 | |
Property, plant and equipment, net | 17,855 | 2,336,036 | |
Intangible assets | 5,312,906 | 21,446,345 | |
Amount due from related parties | 3,402,823 | ||
Long-term investments | 12,250,000 | 15,000,000 | |
TOTAL ASSETS | 115,980,570 | 62,946,609 | |
CURRENT LIABILITIES | |||
Accounts payable | 320,378 | 11,054,290 | |
Accrued expenses | 4,547,380 | 99,131,073 | |
Advances from customers | 702,179 | 1,160,029 | |
Short-term bank loans | 957,990 | 5,828,185 | |
TOTAL CURRENT LIABILITIES | 202,789,675 | 117,173,578 | |
NON-CURRENT LIABILITIES | |||
TOTAL NON-CURRENT LIABILITIES | 1,268,101 | 32,450,867 | |
TOTAL LIABILITIES | 204,057,776 | 149,624,445 | |
Commitments and contingencies(Note 16) | |||
Future FinTech Group, Inc, Stockholders' equity | |||
Common stock, $0.001 par value; 60,000,000 shares authorized and 33,810,416 shares and 31,017,083 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively | 33,810 | 31,017 | |
Additional paid-in capital | 107,852,827 | 105,737,256 | |
Accumulated deficits | (213,314,612) | (188,085,680) | |
Accumulated other comprehensive income (loss) | 12,989,408 | (8,961,549) | |
Total Future FinTech Group, Inc. stockholders' equity | (92,438,567) | (91,278,957) | |
Non-controlling interests | 4,361,361 | 4,601,121 | |
Total stockholders' equity | (88,077,206) | (86,677,836) | $ 32,949,843 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 115,980,570 | $ 62,946,609 | |
Pro Forma [Member] | |||
CURRENT ASSETS | |||
Cash and cash equivalents | 539,316 | ||
Accounts receivable, net of allowance of $16,127,000 as of December 31, 2019 and $15,650,217 as of December 31, 2018, respectively | 4,954 | ||
Other receivables, net | 7,489 | ||
Inventories | 3,594 | ||
Advances to suppliers and other current assets | 1,668,847 | ||
TOTAL CURRENT ASSETS | 2,224,200 | ||
Property, plant and equipment, net | 17,855 | ||
Intangible assets | 5,312,906 | ||
Amount due from related parties | 3,402,823 | ||
Long-term investments | 12,250,000 | ||
TOTAL ASSETS | 23,207,784 | ||
CURRENT LIABILITIES | |||
Accounts payable | 320,378 | ||
Accrued expenses | 4,547,380 | ||
Advances from customers | 702,179 | ||
Short-term bank loans | 957,990 | ||
TOTAL CURRENT LIABILITIES | 6,527,927 | ||
NON-CURRENT LIABILITIES | |||
Amount due to related parties | 1,268,101 | ||
TOTAL NON-CURRENT LIABILITIES | 1,268,101 | ||
TOTAL LIABILITIES | 7,796,028 | ||
Commitments and contingencies(Note 16) | |||
Future FinTech Group, Inc, Stockholders' equity | |||
Common stock, $0.001 par value; 60,000,000 shares authorized and 33,810,416 shares and 31,017,083 shares issued and outstanding as of December 31, 2019 and December 31, 2018, respectively | 33,810 | ||
Additional paid-in capital | 107,852,827 | ||
Accumulated deficits | (109,825,651) | ||
Accumulated other comprehensive income (loss) | 12,989,409 | ||
Total Future FinTech Group, Inc. stockholders' equity | 11,050,395 | ||
Non-controlling interests | 4,361,361 | ||
Total stockholders' equity | 15,411,756 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 23,207,784 |
Unaudited Condensed Pro Forma_4
Unaudited Condensed Pro Forma Financial Statements (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue | $ 955,172 | $ 888,670 |
Cost of goods sold | 464,307 | 975,042 |
Gross profit | 490,865 | (86,372) |
Operating Expenses | ||
General and administrative expenses | 4,913,656 | 11,944,924 |
Selling expenses | 500,949 | 188,579 |
Inventory markdown | 27,247 | |
Impairment Loss | 2,751,099 | 178,296,747 |
Total operating expenses | 13,427,156 | 190,430,250 |
Loss from operations | (12,936,291) | (190,516,623) |
Other (expenses) income | ||
Interest income | 3,995 | 1,372 |
Interest expenses | 523,676 | 1,624,683 |
Other income(expenses) | (229,042) | 2,387,813 |
Total other income (expenses) net | (748,723) | 764,502 |
Loss from Continuing Operations before Income Tax | (13,685,014) | (189,752,121) |
Income tax provision | 237 | |
Loss from Continuing Operations before Non-controlling Minority Interest | (13,685,014) | (189,752,358) |
Less: Net loss attributable to non-controlling interests | (163,576) | (15,741,937) |
Loss from Continuing Operations | (13,521,438) | (174,010,421) |
Discontinued Operations | ||
Loss from discontinued operations | (11,707,494) | 4,013,367 |
NET LOSS ATTRIBUTABLE TO FUTURE FINTECH GROUP INC | $ (25,228,932) | $ (169,997,054) |
Earnings per share: | ||
Basic earnings per share from continued operation | $ (0.42) | $ (8.04) |
Basic earnings per share from discontinued operation | (0.37) | 0.19 |
Basic earnings per share from net income | (0.79) | (7.85) |
Diluted Earnings per share: | ||
Diluted earnings per share from continued operation | (0.42) | (7.92) |
Diluted earnings per share from discontinued operation | (0.37) | 0.18 |
Diluted earnings per share from net income | $ (0.79) | $ (7.74) |
Weighted average number of shares outstanding | ||
Basic | 31,996,279 | 21,636,146 |
Diluted | 31,996,279 | 21,966,612 |
Pro Forma [Member] | ||
Revenue | $ 955,172 | $ 131,832 |
Cost of goods sold | 464,307 | 83,888 |
Gross profit | 490,865 | 47,944 |
Operating Expenses | ||
General and administrative expenses | 4,913,656 | 1,636,298 |
Selling expenses | 500,949 | 14,482 |
Bad debt provision | 5,234,205 | |
Inventory markdown | 27,247 | |
Impairment Loss | 2,751,099 | 44,665,618 |
Total operating expenses | 13,427,156 | 46,316,398 |
Loss from operations | (12,936,291) | (46,268,454) |
Other (expenses) income | ||
Interest income | 3,995 | 711 |
Interest expenses | (523,676) | 96,329 |
Other income(expenses) | (229,042) | (4,382,686) |
Total other income (expenses) net | (748,723) | (4,285,646) |
Loss from Continuing Operations before Income Tax | (13,685,014) | (50,554,100) |
Income tax provision | 206 | |
Loss from Continuing Operations before Non-controlling Minority Interest | (13,685,014) | (50,554,306) |
Less: Net loss attributable to non-controlling interests | (163,576) | (123,139) |
Loss from Continuing Operations | (13,521,438) | (50,431,167) |
Discontinued Operations | ||
Loss from discontinued operations | ||
NET LOSS ATTRIBUTABLE TO FUTURE FINTECH GROUP INC | $ (13,521,438) | $ (50,431,167) |
Earnings per share: | ||
Basic earnings per share from continued operation | $ (0.42) | $ (2.33) |
Basic earnings per share from discontinued operation | ||
Basic earnings per share from net income | (0.42) | (2.33) |
Diluted Earnings per share: | ||
Diluted earnings per share from continued operation | (0.42) | (2.30) |
Diluted earnings per share from discontinued operation | ||
Diluted earnings per share from net income | $ (0.42) | $ (2.30) |
Weighted average number of shares outstanding | ||
Basic | 33,996,279 | 21,636,146 |
Diluted | 33,996,279 | 21,966,612 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Mar. 11, 2020 | Jan. 15, 2020 | Jan. 06, 2020 | Jan. 25, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jan. 23, 2018 |
Subsequent Events (Textual) | |||||||
Promissory note principal amount | $ 9,600,000 | ||||||
Common stock, par value | $ 0.001 | $ 0.001 | |||||
Ninth Exchange Agreement [Member] | |||||||
Subsequent Events (Textual) | |||||||
Promissory note principal amount | $ 140,000 | ||||||
Common stock, par value | $ 0.001 | ||||||
Conversion of stock | 186,666 | ||||||
Eighth Exchange Agreement [Member] | |||||||
Subsequent Events (Textual) | |||||||
Promissory note principal amount | $ 145,000 | ||||||
Common stock, par value | $ 0.001 | ||||||
Conversion of stock | 193,333 | ||||||
Eleventh Exchange Agreement [Member] | |||||||
Subsequent Events (Textual) | |||||||
Promissory note principal amount | $ 150,000 | ||||||
Common stock, par value | $ 0.001 | ||||||
Conversion of stock | 200,000 | ||||||
Consulting Service Agreement [Member] | |||||||
Subsequent Events (Textual) | |||||||
Subsequent event, description | (i) help the Company to locate new merger projects globally, develop new merger strategy and provide the Company with at least five (5) merger and acquisition targets that have synergy with the Company's business and development plans and could clearly contribute to the Company's strategic goals each year; (ii) help the Company to map out new growth strategies in addition to its current business; (iii) work with the Company to explore new lines of business and associated growth strategies; and (iv) conduct market research and evaluating variable projects and providing feasibility studies per Company's request from time to time. The term of the Agreement is three years. In consideration of the services to be provided by Consultant to the Company, the Company agrees to pay the Consultant a three-year consulting fee totaling $3 million. The Company shall issue a total of 3,750,000 restricted shares of common stock of the Company (the "Shares") at a price of $0.80 per share as the payment for the above mentioned consultant fee to the Consultant. The parties agree that no shares will be issued until the board of directors of the Company (the "Board") and NASDAQ approve the issuance of the Shares. The Company agrees to issue the Shares in the name of the Consultant within 10 days after approval from the Board and NASDAQ, among which 1,500,000 shares should be released to the Consultant immediately upon issuance, 1,125,000 shares will be held by the Company and released to the Consultant on January 25, 2021 if this Agreement has not been terminated and there has been no breach of Agreement by the Consultant at such time, and the last 1,125,000 shares will be held by the Company and released to the Consultant on January 25, 2022 if this Agreement has not been terminated and there has been no breach of the Agreement by the Consultant at such time. |