What changed in this filing

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Item 1. Legal Proceedings

2024-08-12 compared with 2024-05-10 · 38 added, 36 removed, 7 unchanged (91% of the section changed)

Legal Proceedings.

time to time become a party to various legal or administrative proceedings arising in the ordinary course of our business.

We are currently

not a party to any legal or administrative proceedings and are not aware of any pending or threatened legal or administrative proceedings

against us in all material aspects other than the following:

In February 17, 2022, FT

Global Capital, Inc.

(“FTG”), filed a lawsuit against the Company in the Commercial Division of New York Supreme Court

(the “Court”).

FTG has brought a breach of contract action against the Company to recover fees in connection with an

agreement that the parties entered into in April 2019 (the “Agreement”).

The Company has answered FTG’s complaint

and has denied the allegations because it is the Company’s position that FTG did not fulfill its obligations under the terms

of the Agreement.

We may from time to time become a party to various

legal or administrative proceedings arising in the ordinary course of our business.

We are currently not a party to any legal or administrative

proceedings and are not aware of any pending or threatened legal or administrative proceedings against us in all material aspects other

than the following:

In February 17, 2022, FT Global Capital, Inc.

(“FTG”), filed a lawsuit against the Company in the Commercial Division of New York Supreme Court (the “Court”).

FTG has brought a breach of contract action against the Company to recover fees in connection with an agreement that the parties entered

into in April 2019 (the “Agreement”).

The Company has answered FTG’s complaint and has denied the allegations because

it is the Company’s position that FTG did not fulfill its obligations under the terms of the Agreement.

Discovery is continuing.

The Court issued a Status Conference Order (the “Order”) dated April 15, 2024.

According to the Order, the Court ordered that the Company has failed to appear and is in default, and that pursuant to the

warning given in the Court’s order dated March 22, 2024, the Company’s default renders its answer subject to being

stricken, and accordingly the answer of the Company is hereby stricken.

On April 18, 2024, FT Global filed a notice of motion for

default judgment against the Company.

In November 2023, an individual plaintiff involved in a civil loan dispute filed a lawsuit against the defendants including Tengsheng

Paper and Jie Ping, who served as the executive director and the legal representative of Tengsheng Paper, at the Lianchi District People's

Court of Baoding City, China (the “PRC Court”).

On December 1, 2023, the plaintiff sought property preservation measures,

requesting the PRC Court to freeze RMB3.35 million worth of bank deposits held by Jie Ping and Tengsheng Paper.

Following this request,

on the same day, the PRC Court issued a ruling to immediately freeze the RMB3.35 million worth of bank deposits of Jie Ping and Tengsheng

resolution of the proceedings may have a material adverse impact on our business, financial condition, results of operations or cash flows.

Failure to settle the proceedings or other unfavorable outcomes in this proceedings could result in significant damages, additional penalties

or other remedies imposed against the Company.

Litigation of this kind could result in substantial costs and a diversion of our management’s

attention and resources.

It could also result in our reputation being harmed and our stock price could decline as a result of allegations

made in the course ofthe proceedings, regardless of the truthfulness of the allegations.

According to the Order, the Court ordered that

the Company has failed to appear and is in default, and that pursuant to the warning given in the Court’s order dated March 22,

2024, the Company’s default renders its answer subject to being stricken, and accordingly the answer of the Company was stricken.

On April 18, 2024, FT Global filed a notice of motion for default judgment against the Company.

The Court issued an order dated June 12,

2024, pursuant to which the plaintiff’s motion for leave to enter a default judgment against the Company was denied, without prejudice

to renewal on proper pagers within 30 days of the date of this order.

November 2023, an individual plaintiff involved in a civil loan dispute filed a lawsuit against the defendants including Tengsheng Paper

and Jie Ping, who served as the executive director and the legal representative of Tengsheng Paper, at the Lianchi District People’s Court

of Baoding City, China (the “PRC Court”).

On December 1, 2023, the plaintiff sought property preservation measures, requesting

the PRC Court to freeze RMB3.35 million worth of bank deposits held by Jie Ping and Tengsheng Paper.

Following this request, on the same

day, the PRC Court issued a ruling to immediately freeze the RMB3.35 million worth of bank deposits of Jie Ping and Tengsheng Paper.

June 14, 2024, t he PRC Court ordered the defendants to

repay the principal of the loan in the amount of RMB3,320,000 to the plaintiff, and Tengsheng Paper was jointly liable for repayment.

The ultimate resolution of the proceedings may

have a material adverse impact on our business, financial condition, results of operations or cash flows.

Failure to settle the proceedings

or other unfavorable outcomes in this proceedings could result in significant damages, additional penalties or other remedies imposed

against the Company.

Litigation of this kind could result in substantial costs and a diversion of our management’s attention and

It could also result in our reputation being harmed and our stock price could decline as a result of allegations made in the

course of the proceedings, regardless of the truthfulness of the allegations.

Risk Factors.

We are a smaller reporting company

as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Unregistered Sales of Equity

Securities and Use of Proceeds.

We are a smaller reporting company as defined

by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

Unregistered Sales of Equity Securities and Use of Proceeds.

Defaults Upon Senior Securities.

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Legal Proceedings