What changed in this filing

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Item 1. Financial Statements

2019-05-15 compared with 2018-11-13 · 559 added, 483 removed, 555 unchanged (65% of the section changed)

Financial Statements (Unaudited)

CM SEVEN STAR ACQUISITION CORPORATION

KAIXIN AUTO HOLDINGS

(formerly CM Seven Star Acquisition Corporation)

CONDENSED BALANCE SHEETS

September 30,

Prepaid assets

5 unchanged sentences

Accounts payable and accrued expenses

Due to Kaixin

Due to related parties

1 unchanged sentence

Total current liabilities

Ordinary shares subject to possible redemption, 20,413,625 and 20,199,048 shares at redemption value at September 30, 2018 and December 31, 2017, respectively

Ordinary shares subject to possible redemption, 20,497,426 and 20,424,778 shares at redemption value at March 31, 2019 and December 31, 2018, respectively

Shareholders’

4 unchanged sentences

200,000,000 shares authorized;

5,909,467 shares (excluding 20,413,625 shares subject to possible redemption) and 6,124,044 shares (excluding 20,199,048 shares subject to possible redemption) issued and outstanding at September 30, 2018 and December 31, 2017, respectively

5,825,666 shares (excluding 20,497,426 shares subject to possible redemption) and 5,898,314 shares (excluding 20,424,778 shares subject to possible redemption) issued and outstanding at March 31, 2019 and December 31, 2018, respectively

Additional paid-in capital

Accumulated earnings

Retained earnings

Total shareholders’

4 unchanged sentences

of these condensed financial statements.

CM SEVEN STAR ACQUISITION CORPORATION

KAIXIN AUTO HOLDINGS

(formerly CM Seven Star Acquisition Corporation)

CONDENSED STATEMENTS OF OPERATIONS

For the Three Months Ended

September 30,

For the Nine Months Ended

Formation and operating costs

Loss from operations

Other income (loss)

Realized loss from sale of investment

Interest income

Total other income (loss)

Net income (loss)

Total other income

Weighted average shares outstanding, basic and diluted

2 unchanged sentences

of these condensed financial statements.

CM SEVEN STAR ACQUISITION CORPORATION

KAIXIN AUTO HOLDINGS

(formerly CM Seven Star Acquisition Corporation)

CONDENSED STATEMENTS OF CHANGES IN SHAREHOLDERS’

1 unchanged sentence

Shareholders’

Equity (Deficit)

Balance as of December 31, 2018

Reclassification of ordinary shares subject to possible redemption

Balance as of September 30, 2018

This number excludes 20,413,625 and 20,199,048 ordinary shares subject to possible redemption at September 30, 2018 and December 31, 2017, respectively.

Reclassification of ordinary shares subject to possible conversion

Balance as of March 31, 2019

number excludes 20,497,426 and 20,424,778 ordinary shares subject to possible redemption at March 31, 2019 and December

31, 2018, respectively.

The accompanying notes are an integral part

of these condensed financial statements.

CM SEVEN STAR ACQUISITION CORPORATION

KAIXIN AUTO HOLDINGS

(formerly CM Seven Star Acquisition Corporation)

CONDENSED STATEMENTS OF CASH FLOWS

September 30,

For the Three Months Ended

Cash Flows from Operating Activities:

Net income (loss)

Adjustments to reconcile net income (loss) to net cash used in operating activities:

Formation costs paid by related party

Adjustments to reconcile net income to net cash used in operating activities:

Realized loss from sale of investment

6 unchanged sentences

Cash Flows from Investing Activities:

Redemption of investment held in Trust Account

Proceeds from sale of investment held in Trust Account

Principal deposited in Trust Account

Proceeds from sales and redemptions of investment held in Trust Account

Purchase of investment held in Trust Account

(210,760,000 )

(207,078,506 )

Net cash used in investing activities

Cash Flows from Financing Activities:

Proceeds from sale of ordinary shares to initial shareholders

Proceeds from Kaixin

Proceeds from Sponsor loan

Repayment of advances from related party

Payments of deferred offering costs

Net cash provided from financing activities

Net Increase in Cash

Net (Decrease) Increase in Cash

Cash - Beginning

Cash - Ending

Supplemental Disclosure of Non-cash Financing Activities:

Increase in accounts payable and accrued expenses for deferred offering costs

Increase in due to related parties for deferred offering costs

The accompanying notes are an integral part

of these condensed financial statements.

SEVEN STAR ACQUISITION CORPORATION

TO THE FINANCIAL STATEMENTS

KAIXIN AUTO HOLDINGS

(formerly CM Seven Star Acquisition Corporation)

NOTES TO THE FINANCIAL STATEMENTS

MARCH 31, 2019

Note 1 —

1 unchanged sentence

Organization and General

CM Seven Star Acquisition Corporation (the

“Company”) is a newly incorporated blank check company incorporated on November 28, 2016, under the laws of the Cayman

Islands for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization

or other similar business combination with one or more businesses or entities (a “Business Combination”).

The Company’s

efforts to identify a prospective target business will not be limited to a particular industry or geographic location.

As of September 30, 2018, the Company had

not yet commenced any operations.

Kaixin Auto Holdings, formerly CM Seven

Star Acquisition Corporation, (the “Company”

or “KAH”) was incorporated as a blank check company on November

28, 2016, under the laws of the Cayman Islands for the purpose of entering into a merger, share exchange, asset acquisition, stock

purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities (a “Business

Combination”).

The Company’s efforts to identify a prospective target business were not limited to a particular industry

or geographic location.

As of March 31, 2019, the Company had not

yet commenced any operations generating revenue.

The Company has selected December 31 as its fiscal year end.

On April 30, 2019, the Company consummated

a Business Combination.

See Note 10 - Subsequent Events for further discussion.

The registration statements for the Company’s

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Initial Public Offering, the Company consummated the sale of 475,000 units (the “Private Units”) at a price of $10.00

per Unit in a private placement to the Company’s sponsor (the “Sponsor”), generating gross proceeds of $4,750,000,

which is described in Note 4.

per Unit in a private placement to the Company’s sponsor (the “Sponsor”

or “SVF”), generating gross

proceeds of $4,750,000, which is described in Note 4.

Contained in the underwriting agreement

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of November 3, 2017.

The funds in the Trust Account can be invested

government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of 1940, as amended

(the “Investment Company Act”), with a maturity of 180 days or less or in any open-ended investment company that holds

itself out as a money market fund meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined by the Company,

until the earlier of:

(i) the consummation of a Business Combination or (ii) the distribution of the Trust Account as described

below, except that interest earned on the Trust Account can be released to pay the Company’s income or other tax obligations.

The funds in the Trust Account were permitted

to be invested in U.S.

government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act of

1940, as amended (the “Investment Company Act”), with a maturity of 180 days or less or in any open-ended investment

company that holds itself out as a money market fund meeting the conditions of Rule 2a-7 of the Investment Company Act, as determined

by the Company, until the earlier of:

(i) the consummation of a Business Combination or (ii) the distribution of the Trust Account

as described below, except that interest earned on the Trust Account were permitted to be released to pay the Company’s income

or other tax obligations.

Initial Business Combination

The Company’s management has broad

The Company’s management had broad

discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the Private Units, although

substantially all of the net proceeds are intended to be generally applied toward consummating a Business Combination.

substantially all of the net proceeds were intended to be generally applied toward consummating a Business Combination.

The Company’s

Business Combination must be with one or more target businesses that together have a fair market value equal to at least 80% of

the balance in the Trust Account (as defined below) (net of taxes payable) at the time of the signing an agreement to enter into

a Business Combination.

However, the Company will only complete a Business Combination if the post-Business Combination company

owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in

the target sufficient for it not to be required to register as an investment company under the Investment Company Act.

no assurance that the Company will be able to successfully effect a Business Combination.

SEVEN STAR ACQUISITION CORPORATION

TO THE FINANCIAL STATEMENTS

The Company will provide its shareholders

with the opportunity to redeem all or a portion of their shares included in the Public Units sold in the Initial Public Offering

(the “Public Shares”) upon the completion of a Business Combination either (i) in connection with a shareholder meeting

called to approve the Business Combination or (ii) by means of a tender offer.

The decision as to whether the Company will seek

shareholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion.

The shareholders will be entitled to redeem their shares for a pro rata portion of the amount then on deposit in the Trust Account

(initially approximately $10.00 per share, plus any pro rata interest earned on the funds held in the Trust Account and not previously

released to the Company to pay its tax obligations).

Business Combination was required to be with one or more target businesses that together have a fair market value equal to at least

80% of the balance in the Trust Account (as defined below) (net of taxes payable) at the time of the signing an agreement to enter

into a Business Combination.

However, the Company was only to complete a Business Combination if the post-Business Combination

company owned or acquired 50% or more of the outstanding voting securities of the target or otherwise acquired a controlling interest

in the target sufficient for it not to be required to register as an investment company under the Investment Company Act.

The ordinary shares subject to redemption

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to redeem their Public Shares irrespective of whether they vote for or against the proposed transaction.

The Company will have 15 months (to January

2019) from the closing of the Initial Public Offering to consummate a Business Combination (the “Combination Period”).

If the Company is unable to complete a Business Combination within the Combination Period, it will trigger the automatic winding

up, dissolution and liquidation pursuant to the terms of the Amended and Restated Memorandum and Articles of Association.

if the Company anticipates that it may not be able to consummate a Business Combination within 15 months, the Company may, but

is not obligated to, extend the period of time to consummate a Business Combination by an additional three months (for a total

of up to 18 months to complete a Business Combination).

Pursuant to the terms of the Amended and Restated Memorandum and Articles

of Association and the trust agreement entered into between the Company and Continental Stock Transfer & Trust Company, LLC,

in order to extend the time available for the Company to consummate a Business Combination, the Company’s insiders or their

affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account $2,063,629

($0.10 per share), on or prior to the date of the applicable deadline.

The insiders will receive a non-interest bearing, unsecured

promissory note equal to the amount of any such deposit that will not be repaid in the event that the Company is unable to close

a Business Combination unless there are funds available outside the trust account to do so.

Such notes would either be paid upon

consummation of the initial Business Combination, or, at the lender’s discretion, converted upon consummation of the Business

Combination into additional private units at a price of $10.00 per unit.

The Company’s stockholders have approved the issuance

of the private units upon conversion of such notes, to the extent the holder wishes to so convert such notes at the time of the

consummation of a Business Combination.

In the event that the Company receives notice from its insiders five days prior to the

applicable deadline of their intent to effect an extension, the Company intends to issue a press release announcing such intention

at least three days prior to the applicable deadline.

In addition, the Company intends to issue a press release the day after the

applicable deadline announcing whether or not the funds had been timely deposited.

The Company’s insiders and their affiliates

or designees are not obligated to fund the trust account to extend the time for the Company to complete its initial Business Combination.

To the extent that some, but not all, of the Company’s insiders, decide to extend the period of time to consummate its initial

Business Combinations, such insiders (or their affiliates or designees) may deposit the entire amount required.

The Company initially had 15 months (to

January 2019) from the closing of the Initial Public Offering to consummate a Business Combination (the “Combination Period”).

If the Company were unable to complete a Business Combination within the Combination Period, it would have triggered the automatic

winding up, dissolution and liquidation pursuant to the terms of the Amended and Restated Memorandum and Articles of Association.

However, if the Company anticipated that it may not be able to consummate a Business Combination within 15 months, the Company

was permitted to, but was not obligated to, extend the period of time to consummate a Business Combination by an additional three

months (for a total of up to 18 months to complete a Business Combination).

Pursuant to the terms of the Amended and Restated Memorandum

and Articles of Association then in effect and the trust agreement entered into between the Company and Continental Stock Transfer

& Trust Company, LLC, in order to extend the time available for the Company to consummate a Business Combination, the Company’s

insiders or their affiliates or designees, upon five days advance notice prior to the applicable deadline, were required to deposit

into the trust account $2,063,629 ($0.10 per share), on or prior to the date of the applicable deadline.

The insiders received

a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event

that the Company is unable to close a Business Combination unless there are funds available outside the trust account to do so.

Such notes were to either be paid upon consummation of the initial Business Combination, or, at the lender’s discretion,

converted upon consummation of the Business Combination into additional private units at a price of $10.00 per unit.

The Company’s

shareholders have approved the issuance of the private units upon conversion of such notes, to the extent the holder wishes to

so convert such notes at the time of the consummation of a Business Combination.

The Company issued a press release announcing

such intention on January 25, 2019.

In addition, the Company issued a press release the day after the applicable deadline announcing

whether or not the funds had been timely deposited.

On January 25, 2019, the Company extended the time required for the Company

to complete its proposed Business Combination with Kaixin, for an additional three-months, ending April 30, 2019.

The Sponsor or

its designees and Kaixin deposited an aggregate amount of $2,063,629, of which Kaixin funded $1,050,000 and the Sponsor funded

$1,013,629, representing $0.10 per public share, into the Company’s Trust account on January 25, 2019 pursuant to the terms

of the investment management trust agreement entered into by the Company at the time of the Company’s initial public offering

and pursuant to the terms of the definitive share exchange agreement previously entered into by the Company and Kaixin.

The amount in the Trust Account (less the

aggregate nominal par value of the shares of the Company’s public shareholders) under the Companies Law will be treated as

share premium which is distributable under the Companies Law provided that immediately following the date on which the proposed

distribution is proposed to be made, the Company is able to pay the debts as they fall due in the ordinary course of business.

If the Company is forced to liquidate the Trust Account, the public shareholders would be distributed the amount in the Trust Account

calculated as of the date that is two days prior to the distribution date (including any accrued interest).

aggregate nominal par value of the shares of the Company’s public shareholders) under the Companies Law was treated as share

premium which is distributable under the Companies Law.

If the Company were forced to liquidate the Trust Account, the public shareholders

would have been distributed the amount in the Trust Account calculated as of the date that is two days prior to the distribution

date (including any accrued interest).

On April 30, 2019, 20,403,667 shares of KAH ordinary shares were redeemed upon consummation

of the Business Combination.

See Note 10 - Subsequent Events for further discussion.

The Initial Shareholders have agreed to

7 unchanged sentences

to redeem their shares in conjunction with any such amendment.

SEVEN STAR ACQUISITION CORPORATION

TO THE FINANCIAL STATEMENTS

Share Exchange Agreement

On November 2, 2018, the Company entered

into a share exchange agreement with Renren Inc.

(“Renren”

or the “Seller”) and Kaixin Auto Group (“Kaixin”)

pursuant to which the Company would acquire all of the outstanding equity interests of Kaixin (the “Share Exchange Agreement,”

and the transactions contemplated thereby, the “Business Combination”).

Kaixin was founded in 2015 by its corporate

parent, Renren, to capitalize on growth in China’s used car financing industry.

Kaixin operates a unique business model that

includes on-line and brick-and-mortar dealerships as well as a network of parties that provide a range of value-added and after-sale

100% of the acquisition consideration is

newly issued ordinary shares of the Company and amounts remaining in the Company’s trust account at the closing of the business

combination are expected to be used for Kaixin’s capital growth.

Upon closing of the acquisition, Kaixin shareholders received

approximately 28.3 million in ordinary shares as consideration and up to approximately 19.5 million additional ordinary shares

based on incentive earnouts (as described in more detail below), issuable in the future upon achievement of certain financial results

and/or share prices, and subject to certain indemnification arrangements.

In addition, 4.7 million ordinary shares were reserved

for issuance under an equity incentive plan in exchange for outstanding options in Kaixin.

If Kaixin’s revenue equals or exceeds

RMB5.0 billion in 2019 (USD 725.7 million), Renren will receive 1.95 million ordinary shares.

If Kaixin’s 2019 Adjusted Earnings

Before Interest, Taxes, Depreciation, and Amortization (“EBITDA”) equals RMB150 million (USD 21.8 million), Renren

will receive 3.9 million ordinary shares, increasing proportionally to 7.8 million shares if 2019 Adjusted EBITDA equals or exceeds

RMB200 million (USD 29.0 million).

If Kaixin’s 2020 Adjusted EBITDA equals RMB340 million (USD 49.3 million), Renren will

receive 4.875 million ordinary shares, increasing proportionally to 9.75 million ordinary shares if 2020 Adjusted EBITDA equals

or exceeds RMB480 million (USD 69.7 million).

Notwithstanding the Revenue and Adjusted EBITDA achieved by the post-transaction

company for any period, Kaixin shareholders will receive the 2019 earnout shares if the Company’s share price is higher than

$13.00 for any sixty days in any period of ninety consecutive trading days during a fifteen month period following the closing,

and will receive the 2019 earnout shares and the 2020 earnout shares if the Company’s share price is higher than $13.50 for

any sixty days in any period of ninety consecutive trading days during a thirty month period following the closing.

Convertible Loan Agreement

On January 28, 2019, the Company entered

into a convertible loan agreement with Kaixin and Kunlun Tech Limited (“Kunlun”), pursuant to which Kunlun agreed to

fund, subject to customary closing conditions, a $23 million convertible loan to Kaixin (the “Kunlun Loan”), with interest

payable at the rate stipulated by the People’s Bank of China.

The first tranche of the Loan, in the amount of $20 million,

was funded to Kaixin on January 28, 2019, and the remaining $3 million is to be funded on or before January 31, 2020.

Upon completion of the Business Combination

with Kaixin, all amounts outstanding under the Kunlun Loan were automatically converted into Company units (each unit having the

same underlying securities as were issued in Initial Public Offering) at a conversion price of $10.00 per unit.

Accounting for the Acquisition

The Business Combination is accounted for

as a “reverse merger”

in accordance with U.S.

Under this method of accounting, the Company will be treated as

the “acquired”

company for financial reporting purposes.

This determination is primarily based on the fact that subsequent

to the Business Combination, Kaixin securityholders have a majority of the voting power of the combined company, Kaixin comprising

all of the ongoing operations of the combined entity, Kaixin comprising a majority of the governing body of the combined company,

and Kaixin’s senior management comprising all of the senior management of the combined company.

Accordingly, for accounting

purposes, the Business Combination is treated as the equivalent of Kaixin issuing shares for the net assets of the Company, accompanied

by a recapitalization.

The net assets of the Company for subsequent periods will be stated at fair value which approximates historical

costs as the Company has only cash and short-term liabilities.

No goodwill or other intangible assets are recorded.

prior to the Business Combination will be those of Kaixin.

However, the holders of the initial shares

17 unchanged sentences

claim of any kind in or to monies held in the Trust Account.

The Company will pay the costs of liquidating

The Company paid the costs of liquidating

the Trust Account from the remaining assets outside of the trust account.

If such funds are insufficient, the Sponsor has contractually

agreed to advance the Company the funds necessary to complete such liquidation (currently anticipated to be no more than approximately

$18,500) and has contractually agreed not to seek repayment for such expenses.

As of September 30, 2018, the Company had

cash outside the Trust Account of $374,955 available for working capital needs.

All remaining cash was held in the Trust Account

and is generally unavailable for use, prior to an initial Business Combination, and is restricted for use either in a Business

Combination or to redeem ordinary shares.

As of September 30, 2018, none of the amount on deposit in the Trust Account was available

to be withdrawn as described above.

Through September 30, 2018, the Company’s

As of March 31, 2019, the Company had cash

outside the Trust Account of $53,980 available for working capital needs.

All remaining cash was held in the Trust Account and

was generally unavailable for use, prior to an initial Business Combination, and is restricted for use either in a Business Combination

or to redeem ordinary shares.

As of March 31, 2019, none of the amount on deposit in the Trust Account was available to be withdrawn

as described above.

Through the March 31, 2019, the Company’s

liquidity needs were satisfied through receipt of $31,038 from the sale of the insider shares, advances from the Company’s

1 unchanged sentence

proceeds from the IPO and Private Placement (as described in Note 3 and Note 4).

On May 23, 2018, the Sponsor loaned to the Company

an additional $500,000 pursuant to a non-convertible non-interest bearing promissory note, which will be repaid promptly after

the date on which the Company consummates a Business Combination.

In the event that the Company is unable to consummate a Business

Combination, the balance of such note will be forgiven and the Sponsor will not be entitled to any payment thereunder.

On May 23, 2018 and January 24, 2019, the Sponsor

loaned to the Company an additional $500,000 (see Note 5) and $1,100,000 (see Note 5), respectively, pursuant to the non-convertible

non-interest-bearing promissory notes, which will be repaid promptly after the date on which the Company consummates a Business

On January 25, 2019, the Company issued two promissory notes in the aggregate of $2,063,629 to its Sponsor and

The promissory note issued to the Sponsor was $1,013,629 and the promissory note issued to Kaixin was $1,050,000.

The $2,063,629

received by the Company upon issuance of the notes was deposited into the Company’s Trust Account for the benefit of its

public shareholders in order to extend the period of time the Company had to complete a business combination for an additional

three months, from January 30, 2019 to April 30, 2019 (see Notes 5 and 7)..

The note does not bear interest and is payable promptly

after the date the Company completes a Business Combination.

Until consummation of its Business Combination,

the Company will be using the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates,

performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations

of prospective target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting

the target business to acquire and structuring, negotiating and consummating the Business Combination.

SEVEN STAR ACQUISITION CORPORATION

TO THE FINANCIAL STATEMENTS

the Company used the funds not held in the Trust Account for identifying and evaluating prospective acquisition candidates, performing

business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective

target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting the target

business to acquire and structuring, negotiating and consummating the Business Combination.

On November 2, 2018, the Company entered

into a share exchange agreement with Kaixin Auto Group, as described in Note 9 –

Subsequent Events.

The initial business

combination is expected to close during Q1 2019.

The Company has engaged several professional firms for services regarding the

transaction, resulting in a significant increase in the Company’s expenditures for M&A related activities.

If the Company

is required to pay these costs prior to the initial business combination closing, then the Company will need to raise additional

capital through loans from its Sponsor, officers, directors, or third parties.

None of the Sponsor, officers or directors are under

any obligation to advance funds to, or to invest in, the Company.

If the Company is unable to raise additional capital, it may

be required to take additional measures to conserve liquidity, which could include, but not necessarily be limited to, curtailing

operations, suspending the pursuit of its business plan, and reducing overhead expenses.

The Company cannot provide any assurance

that new financing will be available to it on commercially acceptable terms, if at all.

Furthermore, if the Company is not able

to consummate a Business Combination within 15 months from its IPO, which is approximately three months from the date of

this filing, the Company may exercise its option to extend the timeframe for an additional three months, which would require the

Company to deposit into the trust account $2,063,629 (an additional $0.10 per IPO share), or commence an automatic winding up,

dissolution and liquidation of the Company.

These conditions raise substantial doubt about the Company’s ability to continue

as a going concern.

These financial statements do not include any adjustments that might result from the outcome of these uncertainties.

into a Share Exchange Agreement with Kaixin Auto Group.

The Business Combination closed on April 30, 2019.

The Company has engaged

several professional firms for services regarding the transaction, resulting in a significant increase in the Company’s expenditures

for merger and acquisition related activities.

On April 30, 2019, the Company consummated the transactions contemplated by the

Share Exchange Agreement.

Please see Note 10 –

Subsequent Events for further discussion.

Note 2 —

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Offering costs consist principally of professional and registration fees incurred through the balance sheet date that are related

to the Public Offering and that were charged to stockholders’

to the Public Offering and that were charged to shareholders’

equity upon the completion of the Initial Public Offering.

Accordingly, offering costs totaling approximately $8,280,000 have been charged to stockholders’

Accordingly, offering costs totaling approximately $8,280,000 have been charged to shareholders’

equity (consisting of $4,127,260

8 unchanged sentences

Actual results could differ from those estimates.

SEVEN STAR ACQUISITION CORPORATION

TO THE FINANCIAL STATEMENTS

Cash and Cash Equivalents

2 unchanged sentences

The Company did not have any cash equivalents

as of September 30, 2018 and December 31, 2017.

as of March 31, 2019 and December 31, 2018.

Investment Held in Trust Account

48 unchanged sentences

Valuations based on (i) quoted prices in active markets for similar assets and liabilities, (ii) quoted prices in markets that are not active for identical or similar assets, (iii) inputs other than quoted prices for the assets or liabilities, or (iv) inputs that are derived principally from or corroborated by market through correlation or other means.

SEVEN STAR ACQUISITION CORPORATION

TO THE FINANCIAL STATEMENTS

Level 3 —

4 unchanged sentences

The fair values of cash, prepaid assets, accounts

payable and accrued expenses, due to related parties and due to Sponsor are estimated to approximate the carrying values as of

September 30, 2018 due to the short maturities of such instruments.

payable and accrued expenses, due to Kaixin, due to related parties and due to Sponsor are estimated to approximate the carrying

values as of March 31, 2019 due to the short maturities of such instruments.

The following table presents information

about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of September 30, 2018

and December 31, 2017 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such

September 30,

Quoted Prices In

Active Markets

about the Company’s assets and liabilities that were measured at fair value on a recurring basis as of March 31, 2019 and

December 31, 2018 and indicates the fair value hierarchy of the valuation techniques the Company utilized to determine such fair

Money Market held in Trust Account

2 unchanged sentences

$ 210,708,529

Quoted Prices In

Active Markets

Money Market held in Trust Account

15 unchanged sentences

to be outside of the Company’s control and subject to occurrence of uncertain future events.

Accordingly, at September 30,

Accordingly, at March 31, 2019

and December 31, 2018, ordinary shares subject to possible redemption are presented as temporary equity, outside of the shareholders’

16 unchanged sentences

net income by the weighted average number of ordinary shares issued and outstanding for the period.

At September 30, 2018, the

Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted into ordinary

shares and then share in the income of the Company.

As a result, diluted income per ordinary share is the same as basic income

per ordinary share for the period.

SEVEN STAR ACQUISITION CORPORATION

TO THE FINANCIAL STATEMENTS

At March 31, 2019 and December

31, 2018, the Company did not have any dilutive securities and other contracts that could, potentially, be exercised or converted

into ordinary shares and then share in the income of the Company.

As a result, diluted income per ordinary share is the same as

basic income per ordinary share for the periods presented.

Concentration of Credit Risk

22 unchanged sentences

Since the Company was incorporated on November 28, 2016, the evaluation

was performed for the 2017 tax year which is the only period subject to examination.

The Company believes that its income tax positions

and deductions would be sustained on audit and does not anticipate any adjustments that would result in a material changes to its

financial position.

The Company’s policy for recording interest and penalties associated with audits is to record such items

as a component of income tax expense.

SEVEN STAR ACQUISITION CORPORATION

TO THE FINANCIAL STATEMENTS

was performed through the 2018 tax year.

The Company believes that its income tax positions and deductions would be sustained on

audit and does not anticipate any adjustments that would result in a material change to its financial position.

The Company’s

policy for recording interest and penalties associated with audits is to record such items as a component of income tax expense.

Recent Accounting Pronouncements

26 unchanged sentences

The proceeds from the Private Units were added to the proceeds from the Initial Public Offering held in the Trust Account.

The Private Units are identical to the

units sold in the Initial Public Offering except the Private Units will be non-redeemable.

The purchasers of the Private Units

have agreed not to transfer, assign or sell any of the Private Units or underlying securities (except to the same permitted transferees

as the insider shares) until the completion of the Business Combination.

If the Company does not complete a Business

Combination within the Combination Period, the proceeds of the sale of the Private Units will be used to fund the redemption of

the Public Shares (subject to the requirements of applicable law).

The Private Units were identical to the

units sold in the Initial Public Offering except the Private Units were non-redeemable.

The purchasers of the Private Units agreed

not to transfer, assign or sell any of the Private Units or underlying securities (except to the same permitted transferees as

the insider shares) until the completion of the Business Combination.

Note 5 –

9 unchanged sentences

over-allotment is not exercised in full or in part, so that the Initial Shareholders

will own 20% of the Company’s issued and outstanding shares after the Initial Public Offering.

On November 3, 2017, 15,927

Insider Shares were forfeited to the extent that the underwriters’

owned 20% of the Company’s issued and outstanding shares after the Initial Public Offering.

On November 3, 2017, 15,927 Insider

Shares were forfeited to the extent that the underwriters’

over-allotment is exercised in part.

1 unchanged sentence

maintained 20% of the Company’s issued and outstanding shares after the Initial Public Offering and the exercise of the over-allotment.

The Initial Shareholders have agreed not

to transfer, assign or sell any of the Insider Shares (except to certain permitted transferees) until (1) with respect to 50% of

the Insider Shares, the earlier of one year after the date of the consummation of the Business Combination and the date on which

the closing price of the common shares equals or exceeds $12.50 per share (as adjusted for share splits, share capitalizations,

reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after the Business Combination

and (2) with respect to the remaining 50% of the Insider Shares, one year after the date of the consummation of the Business Combination,

The Initial Shareholders agreed not to

transfer, assign or sell any of the Insider Shares (except to certain permitted transferees) until (1) with respect to 50% of the

Insider Shares, the earlier of one year after the date of the consummation of the Business Combination and the date on which the

closing price of the common shares equals or exceeds $12.50 per share (as adjusted for share splits, share capitalizations, reorganizations

and recapitalizations) for any 20 trading days within any 30-trading day period commencing after the Business Combination and (2)

with respect to the remaining 50% of the Insider Shares, one year after the date of the consummation of the Business Combination,

or earlier, in either case, if, subsequent to the Business Combination, the Company consummates a liquidation, merger, stock exchange

13 unchanged sentences

after the date on which the Company consummates a Business Combination.

In the event that the Company is unable to consummate a

Business Combination, the balance of such note will be forgiven and the Sponsor will not be entitled to any payment thereunder.

of September 30, 2018 and December 31, 2017, amount due to related parties were $27,530 and $4,289, respectively.

were unpaid reimbursements for the operating expenses paid by the officers on behalf of the Company.

CM SEVEN STAR ACQUISITION CORPORATION

NOTES TO THE FINANCIAL STATEMENTS

SEPTEMBER 30, 2018

Note 5 –

Related Party Transactions (cont.)

On January 24, 2019, the Sponsor loaned

to the Company an additional $1,100,000 pursuant to a non-convertible non-interest-bearing promissory note, which will be repaid

promptly after the date on which the Company consummates a Business Combination.

On January 25, 2019, the Company issued

a convertible promissory note to the Sponsor amounting to $1,013,629, and such amount received by the Company upon issuance of

the note was deposited into the Company’s Trust Account for the benefit of its public shareholders in order to extend the period

of time the Company has to complete a business combination for an additional three months, from January 30, 2019 to April 30, 2019.

As of March 31, 2019 and December 31, 2018,

the total of all Sponsor loans to the Company was $2,613,629 and $500,000, respectively.

As of March 31, 2019 and December 31, 2018,

amount due to related parties were $3,538 and $18,919, respectively.

The amounts were unpaid reimbursements for the operating expenses

paid by the officers on behalf of the Company.

Related Party Loans

12 unchanged sentences

is included and the holder wishes to so convert them at the time of the consummation of the initial Business Combination.

Company does not complete a Business Combination, the loans will not be repaid.

was no outstanding balance under Working Capital Loans from related party as of March 31, 2019 and December 31, 2018.

Note 6 —Investment Held in Trust

As of September 30, 2018, investment in

As of March 31, 2019, the investment in

the Company’s Trust Account consisted of $177 in cash and $213,708,529 in U.S.

1 unchanged sentence

As of December 31, 2018,

investment in the Company’s Trust Account consisted of $8,940 in United States Money Market and $206,776,908 in U.S.

The Company classifies its United States Treasury and equivalent securities as held-to-maturity in accordance with

FASB ASC 320 “Investments —

the investment in the Company’s Trust Account consisted of $3,600 in cash and $210,451,869 in U.S.

Treasury Securities.

Company classifies its United States Treasury Bills and equivalent securities as held-to-maturity in accordance with FASB ASC 320

“Investments —

Debt and Equity Securities”.

Held-to-maturity treasury securities are recorded at

amortized cost and adjusted for the amortization or accretion of premiums or discounts.

The Company considers all investments with

original maturities of more than three months but less than one year to be short-term investments.

The carrying value approximates

the fair value due to the short term maturity.

As of September 30, 2018 and December 31, 2017, cash and investments held in trust

account is $209,362,389 and $206,785,848, respectively.

The carrying value, excluding gross unrealized holding loss and fair value

of held to maturity securities on September 30, 2018 and December 31, 2017 are as follows:

September 30,

Held-to-maturity treasury securities are recorded at amortized cost

and adjusted for the amortization or accretion of premiums or discounts.

The Company considers all investments with original maturities

of more than three months but less than one year to be short-term investments.

The carrying value approximates the fair value due

to its short-term maturity.

As of March 31, 2019 and December 31, 2018, cash and investments held in trust account are $213,708,706

and $210,455,469, respectively.

The carrying value, excluding gross unrealized holding gain (loss) and fair value of held to maturity

securities on March 31, 2019 and December 31, 2018 are as follows:

Gross Unrealized

September 30,

Treasury Securities

5 unchanged sentences

$ 210,470,644

In February 2018, the Company sold the U.S.

Treasury Securities

in a net carrying value of $207,176,263 for a total cash of $207,078,506.

The Company recorded a realized loss from sale of investment

in the amount of $97,758 accordingly.

In August 2018, the Company redeemed the expired treasury bills for total cash proceeds of

$208,816,500.

CM SEVEN STAR ACQUISITION CORPORATION

NOTES TO THE FINANCIAL STATEMENTS

SEPTEMBER 30, 2018

In January 2019, the Company redeemed the

expired treasury bills for total cash proceeds of $210,760,000 and re-invested in U.S.

Treasury Bills.

Note 7 –

Due to Kaixin

On January 25, 2019, the Company issued

a convertible promissory note to Kaixin amounting to $1,050,000, and such amount received by the Company upon issuance of the note

was deposited into the Company’s Trust Account for the benefit of its public shareholders in order to extend the period

of time the Company has to complete a business combination for an additional three months, from January 30, 2019 to April 30, 2019.

Kaixin has the right to convert the note in whole into Private Units of the Company at a price of $10 per unit upon the closing

of a Business Combination.

Note 8 –

Commitments & Contingencies

32 unchanged sentences

of the gross proceeds raised in the offering payable to EBC may be allocated at the Company’s sole discretion to one or more

advisors that assist in identifying and consummating an Business Combination.

advisors that assist in identifying and consummating a Business Combination.

The Company will also reimburse EBC for up to $20,000

1 unchanged sentence

the performance of its services.

CM SEVEN STAR ACQUISITION CORPORATION

NOTES TO THE FINANCIAL STATEMENTS

SEPTEMBER 30, 2018

Note 7 –

Commitments & Contingencies (cont.)

Unit Purchase Option

17 unchanged sentences

of 2.03% and (3) expected life of five years.

The option and such units purchased pursuant to the option, as well as the common

stock underlying such units, the rights included in such units, the common stock that is issuable for the rights included in such

units, the warrants included in such units, and the shares underlying such warrants, have been deemed compensation by FINRA and

are therefore subject to a 180-day lock-up pursuant to Rule 5110(g)(1) of FINRA’s NASDAQ Conduct Rules.

Additionally, the

option may not be sold, transferred, assigned, pledged or hypothecated for a one-year period (including the foregoing 180-day period)

following the date of Initial Public Offering except to any underwriter and selected dealer participating in the Initial Public

Offering and their bona fide officers or partners.

The option and such units purchased pursuant to the option, as well as the ordinary

shares underlying such units, the rights included in such units, the ordinary shares that are issuable for the rights included

in such units, the warrants included in such units, and the shares underlying such warrants, have been deemed compensation by FINRA

and are therefore subject to a 180-day lock-up pursuant to Rule 5110(g)(1) of FINRA’s NASDAQ Conduct Rules.

Additionally,

the option may not be sold, transferred, assigned, pledged or hypothecated for a one-year period (including the foregoing 180-day

period) following the date of Initial Public Offering except to any underwriter and selected dealer participating in the Initial

Public Offering and their bona fide officers or partners.

The option grants to holders demand and “piggy back”

periods of five and seven years, respectively, from the effective date of the registration statement with respect to the registration

for periods of five and seven years, respectively, from the effective date of the registration statement with respect to the registration

under the Securities Act of the securities directly and indirectly issuable upon exercise of the option.

5 unchanged sentences

the option will not be adjusted for issuances of ordinary shares at a price below its exercise price.

Subscription Agreement

On January 29, 2019, the Company entered

into a subscription agreement (the “Subscription Agreement”) with one accredited investor to sell 750,000 of its units

(each unit having the same underlying securities as were issued in the Initial Public Offering) at a price of $10.00 per unit.

The closing took place on the closing date of the Business Combination.

The investor received certain demand and piggyback registration

rights pursuant to the terms of the Subscription Agreement.

Note 9 —

2 unchanged sentences

Company is authorized to issue a total of 2,000,000 preferred shares of a par value of $0.0001 each.

At September 30, 2018 and

December 31, 2017, there were no shares of preferred shares issued or outstanding.

At March 31, 2019 and December

31, 2018, there were no shares of preferred shares issued or outstanding.

Ordinary Shares - The

Company is authorized to issue a total of 200,000,000 ordinary shares of a par value of $0.0001 each.

As of September 30, 2018,

the Company has issued an aggregate of 5,909,467 ordinary shares, excluding 20,413,625 shares of ordinary shares subject to possible

As of March 31, 2019, the

Company has issued an aggregate of 5,825,666 ordinary shares, excluding 20,497,426 shares of ordinary shares subject to possible

As of December 31, 2018, the Company has issued an aggregate of 5,898,314 ordinary shares, excluding 20,424,778 shares

4 unchanged sentences

for whole numbers of shares, only a whole number of warrants may be exercised at any given time.

The warrants will become exercisable

on the later of the completion of a Business Combination and 12 months from October 25, 2017.

If a registration statement covering

the ordinary shares issuable upon exercise of the public warrants is not effective within 90 days following the consummation of

the Business Combination, public warrant holders may, until such time as there is an effective registration statement and during

any period when the Company shall have failed to maintain an effective registration statement, exercise warrants on a cashless

basis pursuant to an available exemption from registration under the Securities Act.

In such event, each holder would pay the exercise

price by surrendering the warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product

of the number of ordinary shares underlying the warrants, multiplied by the difference between the exercise price of the warrants

and the “fair market value”

The warrants become exercisable

on the later of the completion of the Business Combination.

If a registration statement covering the ordinary shares issuable upon

exercise of the public warrants is not effective within 90 days following the consummation of the Business Combination, public

warrant holders may, until such time as there is an effective registration statement and during any period when the Company shall

have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption

from registration under the Securities Act.

In such event, each holder would pay the exercise price by surrendering the warrants

for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares

underlying the warrants, multiplied by the difference between the exercise price of the warrants and the “fair market value”

(defined below) by (y) the fair market value.

The “fair market value”

mean the average reported last sale price of the ordinary shares for the 10 trading days ending on the day prior to the date of

shall mean the average reported last sale price

of the ordinary shares for the 10 trading days ending on the day prior to the date of exercise.

The warrants issued in the Private Units

6 unchanged sentences

upon a minimum of 30 days’

prior written notice

of redemption,

CM SEVEN STAR ACQUISITION CORPORATION

NOTES TO THE FINANCIAL STATEMENTS

SEPTEMBER 30, 2018

● if, and only if,

the last sales price of the ordinary shares equals or exceeds $18.00 per share for any 20 trading days within a 30 trading

day period ending three business days before the Company sends the notice of redemption, and

● if, and only if, there

is a current registration statement in effect with respect to the ordinary shares underlying such warrants at the time of redemption

and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.

prior written notice of redemption,

if, and only if, the last sales price of the ordinary shares equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period ending three business days before the Company sends the notice of redemption, and

if, and only if, there is a current registration statement in effect with respect to the ordinary shares underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption.

If the Company calls the warrants for redemption

1 unchanged sentence

basis.”

Rights - Except in cases

where the Company is not the surviving company in a Business Combination, each holder of a right will automatically receive one-tenth

(1/10) of an ordinary share upon consummation of the initial Business Combination, even if the holder of a Public Right converted

all ordinary shares held by him, her or it in connection with the initial Business Combination or an amendment to the Company’s

certificate of incorporation with respect to its pre-business combination activities.

In the event that the Company will not be

the surviving company upon completion of the initial Business Combination, each holder of a right will be required to affirmatively

convert his, her or its rights in order to receive the one-tenth (1/10) of a share underlying each right upon consummation of the

Business Combination.

No additional consideration will be required to be paid by a holder of rights in order to receive his, her

or its additional ordinary shares upon consummation of an initial Business Combination.

The shares issuable upon exchange of the

rights will be freely tradable (except to the extent held by affiliates of the Company).

If the Company enters into a definitive

agreement for a Business Combination in which the Company will not be the surviving entity, the definitive agreement will provide

for the holders of rights to receive the same per share consideration the holders of ordinary shares will receive in the transaction

on an as-converted into ordinary shares basis.

The Company will not issue fractional shares

Rights - Each holder

of a right automatically received one-tenth (1/10) of an ordinary share upon consummation of the initial Business Combination,

even if the holder of a Public Right converted all ordinary shares held by him, her or it in connection with the initial Business

Combination or an amendment to the Company’s certificate of incorporation with respect to its pre-business combination activities.

The shares issuable upon exchange of the rights are freely tradable (except to the extent held by affiliates of the Company).

The Company did not issue fractional shares

in connection with an exchange of rights.

Fractional shares will either be rounded down to the nearest whole share or otherwise

Fractional shares were either be rounded down to the nearest whole share or otherwise

addressed in accordance with the applicable provisions of the Cayman Islands law.

As a result, the holders of the rights must hold

rights in multiples of 10 in order to receive shares for all of the holders’

rights upon closing of a Business Combination.

If the Company is unable to complete an initial Business Combination within the required time period and the Company liquidates

the funds held in the trust account, holders of rights will not receive any of such funds with respect to their rights, nor will

they receive any distribution from the Company’s assets held outside of the trust account with respect to such rights, and

the rights will expire worthless.

Further, there are no contractual penalties for failure to deliver securities to the holders

of the rights upon consummation of an initial business combination.

Additionally, in no event will the Company be required to net

cash settle the rights.

Accordingly, the rights may expire worthless.

Note 10 –

Subsequent Events

On November 2, 2018, the Company entered

into a share exchange agreement with Renren Inc.

(“Renren”

or the “Seller”) and Kaixin Auto Group (“Kaixin”)

pursuant to which CM Seven Star would acquire all of the outstanding equity interests of Kaixin.

Kaixin was founded in 2015 by

its corporate parent, Renren, to capitalize on growth in China’s used car financing industry.

Kaixin operates a unique

business model that includes on-line and brick-and-mortar dealerships as well as a network of parties that provide a range of value-added

and after-sale services.

100% of the acquisition consideration

will be newly issued ordinary shares of the Company and amounts remaining in the Company’s trust account at the closing of

the business combination are expected to be used for Kaixin’s capital growth.

Upon closing of the acquisition,

Kaixin shareholders will receive approximately 28.3 million in shares as consideration and up to approximately 19.5 million

additional shares based on incentive earnouts (as described in more detail below), issuable in the future upon achievement of certain

financial results and/or stock prices, and subject to certain indemnification arrangements.

In addition, approximately 4.7 million

shares will be issued at closing or reserved for issuance to Kaixin’s management under its equity incentive plan.

If Kaixin’s revenue equals or exceeds

RMB5.0 billion in 2019 (USD 725.7 million), Renren will receive 1.95 million shares.

If Kaixin’s 2019 Adjusted Earnings

Before Interest, Taxes, Depreciation, and Amortization (“EBITDA”) equals RMB150 million (USD 21.8

million), Renren will receive 3.9 million shares, increasing proportionally to 7.8 million shares if 2019 Adjusted EBITDA equals

or exceeds RMB200 million (USD 29.0 million).

If Kaixin’s 2020 Adjusted EBITDA equals RMB340 million (USD 49.3 million),

Renren will receive 4.875 million shares, increasing proportionally to 9.75 million shares if 2020 Adjusted EBITDA equals or exceeds

RMB480 million (USD 69.7 million).

Notwithstanding the Revenue and Adjusted EBITDA achieved by the post-transaction company for

any period, Kaixin shareholders will receive the 2019 earnout shares if the Company’s stock price is higher than $13.00 for

any sixty days in any period of ninety consecutive trading days during a fifteen month period following the closing, and will receive

the 2019 earnout shares and the 2020 earnout shares if the Company’s stock price is higher than $13.50 for any sixty days

in any period of ninety consecutive trading days during a thirty month period following the closing.

Management’s Discussion and Analysis.

On April 25, 2019, the Company entered

into a convertible loan agreement with Kaixin and 58.com Holdings Inc.

(“58.com Holdings”), pursuant to which 58.com

Holdings agreed to fund, subject to customary closing conditions, a $1 million convertible loan to Kaixin (the “58.com Holdings

Loan”), with interest payable at the rate stipulated by the People’s Bank of China.

The 58.com Holdings Loan was funded

to Kaixin on April 30, 2019.

Upon completion of the Business Combination discussed below, all amounts outstanding under the 58.com

Holdings Loan were automatically converted into the Company’s ordinary shares at a conversion price of $10.00 per ordinary

On April 30, 2019 (the “transaction

closing date”), pursuant to the Exchange Agreement, the Company acquired 100% of the issued and outstanding securities of

Kaixin, in exchange for approximately 28.3 million ordinary shares of KAH, or one KAH share for approximately 4.85 outstanding

shares of Kaixin.

An additional 4.7 million shares of KAH is reserved for issuance under an equity incentive plan in exchange for

outstanding options in Kaixin.

Additionally, 19.5 million earnout shares are to be issued and held in escrow.

The Seller may be

entitled to receive earnout shares as follows:

(1) if the Company’s gross revenue for the year ended December 31, 2019 is

greater than or equal to RMB 5,000,000,000, the Seller is entitled to receive 1,950,000 ordinary shares of KAH;

(2) if the Company’s

adjusted EBITDA for the year ended December 31, 2019 is greater than or equal to RMB 150,000,000, the Seller is entitled to receive

3,900,000 ordinary shares of KAH, increasing proportionally to 7,800,000 ordinary shares if Company’s adjusted EBITDA is

greater than or equal to RMB 200,000,000;

and (3) if the Company’s adjusted EBITDA for the year ended December 31, 2020 is

greater than or equal to RMB 340,000,000, the Seller is entitled to receive 4,875,000 ordinary shares of KAH, increasing proportionally

to 9,750,000 ordinary shares if the Company’s adjusted EBITDA is greater than or equal to RMB 480,000,000.

A total of 20,403,667 shares of KAH ordinary

shares were redeemed upon consummation of the Business Combination at a redemption price of approximately $10.37 per share into

cash of KAH’s ordinary shares.

On the transaction closing date, KAH, Kaixin,

Renren and SVF executed an agreement (the “Waiver Agreement”) pursuant to which Kaixin and Renren waived certain rights

under the Share Exchange Agreement in exchange for SVF’s commitment (i) to contribute $1.6 million to KAH within two weeks

after the closing of the Merger, (ii) to set a limit on the liabilities to be paid by cash (up to US$4.0 million) and noncash (up

to US$2.6 million) consideration by KAH and (iii) to within one month use its best efforts to restructure the loans it has extended

Also, on the transaction closing date,

KAH paid $2 million in cash and issued a $1.5 million note payable to Early Bird Capital (“EBC”) in fees related to

the Acquisition.

In May 2019, KAH granted options with respect

to 2,206,888 ordinary shares and 2,407,733 restricted shares to its employees, directors and officers, and advisors, under its

2019 Equity Incentive Plan.

Management’s Discussion and Analysis of Financial

Condition and Results of Operations.

Forward-Looking Statements

21 unchanged sentences

or the “Company”

Seven Star Acquisition Corporation, except where the context requires otherwise.

The following discussion should be

read in conjunction with our condensed financial statements and related notes thereto included elsewhere in this report.

We were formed on November 28, 2016 as a blank check company

for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization

or other similar business combination, with one or more target businesses.

Our efforts to identify a prospective target business

will not be limited to any particular industry or geographic location.

We have not selected any target business for our initial

business combination.

We presently have no revenue, have had losses since inception

from incurring formation costs and have had no operations other than the active solicitation of a target business with which to

complete a business combination.

We have relied upon the sale of our securities and loans from the Sponsor, our officers and directors

to fund our operations.

On October 30, 2017, we consummated our IPO of 18,000,000 Units.

Each Unit consists of one Ordinary Share, one-half of a redeemable Public Warrant and one Right to receive 1/10 of an Ordinary

Share upon the consummation of our initial business combination.

The Units were sold at an offering price of $10.00 per Unit, generating

gross proceeds of $180,000,000.

The Company granted the underwriters a 45-day option to purchase up to 2,700,000 additional Units

to cover over-allotments, if any.

On October 30, 2017, simultaneously with the consummation of the IPO, we consummated a private

placement with our Sponsor of 475,000 Private Units at a price of $10.00 per Private Unit, generating total proceeds of $4,750,000.

The underwriters exercised the over-allotment option in part and, on November 3, 2017, the underwriters purchased 2,636,293 over-allotment

option Units, which were sold at an offering price of $10.00 per Unit, generating gross proceeds of $26,362,930.

On November 3,

2017, simultaneously with the sale of the over-allotment Units, the Company consummated the private sale of an additional 52,726

Private Units to our Sponsor, generating gross proceeds of $527,260.

On November 3, 2017, the underwriters canceled the remainder

of the over-allotment option.

In connection with the cancellation of the remainder of the over-allotment option, the Company canceled

an aggregate of 15,927 Ordinary Shares issued to our Sponsor prior to the IPO and Private Placement.

As of September 30, 2018, a total of $209,362,389 was held in

a trust account established for the benefit of the Company’s public shareholders, which included $206,362,930 of the net

proceeds from the IPO (including the partial exercise of the over-allotment option) and the Private Placements and subsequent interest

Our management has broad discretion with respect to the specific

application of the net proceeds of IPO and the Private Placements, although substantially all of the net proceeds are intended

are to Kaixin

Auto Holdings, except where the context requires otherwise.

The following discussion should be read in conjunction with

our condensed financial statements and related notes thereto included elsewhere in this report.

As of March 31, 2019, we were a blank check

company formed on November 28, 2016 for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase,

recapitalization, reorganization or other similar business combination, with one or more target businesses.

Our efforts to identify

a prospective target business will not be limited to any particular industry or geographic location.

Results of Operations

Through March 31, 2019, we had no revenue,

had had losses since inception from incurring formation costs and have had no operations other than the active solicitation of

a target business with which to complete a business combination.

Through March 31, 2019 we relied upon the sale of our securities

and loans from the Sponsor, our officers and directors to fund our operations.

On October 30, 2017, we consummated our

IPO of 18,000,000 Units.

Each Unit consists of one Ordinary Share, one-half of a redeemable Public Warrant and one Right to receive

1/10 of an Ordinary Share upon the consummation of our initial business combination.

The Units were sold at an offering price of

$10.00 per Unit, generating gross proceeds of $180,000,000.

The Company granted the underwriters a 45-day option to purchase up

to 2,700,000 additional Units to cover over-allotments, if any.

On October 30, 2017, simultaneously with the consummation of the

IPO, we consummated a private placement with our Sponsor of 475,000 Private Units at a price of $10.00 per Private Unit, generating

total proceeds of $4,750,000.

The underwriters exercised the over-allotment option in part and, on November 3, 2017, the underwriters

purchased 2,636,293 over-allotment option Units, which were sold at an offering price of $10.00 per Unit, generating gross proceeds

of $26,362,930.

On November 3, 2017, simultaneously with the sale of the over-allotment Units, the Company consummated the private

sale of an additional 52,726 Private Units to our Sponsor, generating gross proceeds of $527,260.

On November 3, 2017, the underwriters

canceled the remainder of the over-allotment option.

In connection with the cancellation of the remainder of the over-allotment

option, the Company canceled an aggregate of 15,927 Ordinary Shares issued to our Sponsor prior to the IPO and Private Placement.

As of March 31, 2019, a total of $213,708,706 was held in a

trust account established for the benefit of the Company’s public shareholders, which included $206,362,930 of the net proceeds

from the IPO (including the partial exercise of the over-allotment option) and the Private Placements and subsequent interest income.

Our management had broad discretion with respect to the specific

application of the net proceeds of IPO and the Private Placements, although substantially all of the net proceeds were intended

to be applied generally towards consummating a business combination.

Proposed Business Combination

On November 2, 2018, the Company entered

into a share exchange agreement with Renren Inc.

(“Renren”

or the “Seller”) and Kaixin Auto Group (“Kaixin”)

pursuant to which CM Seven Star would acquire all of the outstanding equity interests of Kaixin.

Kaixin was founded in 2015 by

its corporate parent, Renren, to capitalize on growth in China’s used car financing industry.

Kaixin operates a unique

business model that includes on-line and brick-and-mortar dealerships as well as a network of parties that provide a range of value-added

and after-sale services.

100% of the acquisition consideration

will be newly issued ordinary shares of the Company and amounts remaining in the Company’s trust account at the closing of

the business combination are expected to be used for Kaixin’s capital growth.

Upon closing of the Acquisition, Kaixin

shareholders will receive approximately 28.3 million in shares as consideration and up to approximately 19.5 million additional

shares based on incentive earnouts (as described in more detail below), issuable in the future upon achievement of certain financial

results and/or stock prices, and subject to certain indemnification arrangements.

In addition, approximately 4.7 million shares

will be issued at closing or reserved for issuance to Kaixin’s management under its equity incentive plan.

If Kaixin’s revenue equals or exceeds RMB5.0 billion in

2019 (USD 725.7 million), Renren will receive 1.95 million shares.

Business Combination Agreement

On November 2, 2018, we entered into a

share exchange agreement (the "Share Exchange Agreement"

or the "Agreement") with Renren Inc.

("Renren"

or the "Seller") and Kaixin Auto Group ("Kaixin") pursuant to which we would acquire all of the outstanding

equity interests of Kaixin (the "Acquisition").

Kaixin was founded in 2015 by its corporate parent, Renren, to capitalize

on growth in China’s used car financing industry.

Kaixin operates a unique business model that includes on-line and brick-and-mortar

dealerships as well as a network of parties that provide a range of value-added and after-sale services.

100% of the acquisition consideration will

be newly issued ordinary shares of the Company and amounts remaining in the Company’s trust account at the closing of the

business combination are expected to be used for Kaixin’s capital growth.

Upon closing of the Acquisition, Kaixin shareholders

will receive approximately 28.3 million in shares as consideration and up to approximately 19.5 million additional shares based

on incentive earnouts (as described in more detail below), issuable in the future upon achievement of certain financial results

and/or share prices, and subject to certain indemnification arrangements.

In addition, approximately 4.7 million shares will be

reserved for issuance under an equity incentive plan in exchange for outstanding options in Kaixin.

If Kaixin’s revenue equals or exceeds

RMB5.0 billion in 2019 (USD 725.7 million), Renren will receive 1.95 million shares.

If Kaixin’s 2019 Adjusted EBITDA equals

RMB150 million (USD 21.8 million), Renren will receive 3.9 million shares, increasing proportionally to 7.8 million shares if 2019

Adjusted EBITDA equals or exceeds RMB200 million (USD 29.0 million).

If Kaixin’s 2020 Adjusted EBITDA equals RMB340 million

(USD 21.8 million), Renren will receive 3.9 million shares, increasing proportionally to 7.8 million shares if 2019 Adjusted EBITDA

equals or exceeds RMB200 million (USD 29.0 million).

If Kaixin’s 2020 Adjusted EBITDA equals RMB340 million (USD 49.3 million),

Renren will receive 4.875 million shares, increasing proportionally to 9.75 million shares if 2020 Adjusted EBITDA equals or exceeds

RMB480 million (USD 69.7 million).

Notwithstanding the Revenue and Adjusted EBITDA achieved by the post-transaction company for

any period, Kaixin shareholders will receive the 2019 earnout shares if the Company’s stock price is higher than $13.00 for

any sixty days in any period of ninety consecutive trading days during a fifteen month period following the closing, and will receive

the 2019 earnout shares and the 2020 earnout shares if the Company’s stock price is higher than $13.50 for any sixty days

in any period of ninety consecutive trading days during a thirty month period following the closing.

(USD 49.3 million), Renren will receive 4.875 million shares, increasing proportionally to 9.75 million shares if 2020 Adjusted

EBITDA equals or exceeds RMB480 million (USD 69.7 million).

Notwithstanding the Revenue and Adjusted EBITDA achieved by the post-transaction

company for any period, Kaixin shareholders will receive the 2019 earnout shares if the Company’s share price is higher than

$13.00 for any sixty days in any period of ninety consecutive trading days during a fifteen month period following the closing,

and will receive the 2019 earnout shares and the 2020 earnout shares if the Company’s share price is higher than $13.50 for

any sixty days in any period of ninety consecutive trading days during a thirty month period following the closing.

On January 25, 2019, the Company extended

the time required for the Company to complete its proposed Business Combination with Kaixin, for an additional three-months, ending

April 30, 2019.

The Sponsor or its designees and Kaixin deposited an aggregate amount of $2,063,629, of which Kaixin funded $1,050,000

and the Sponsor funded $1,013,629, representing $0.10 per public share, into the Company’s Trust account on January 25, 2019

pursuant to the terms of the investment management trust agreement entered into by the Company at the time of the Company’s

initial public offering and pursuant to the terms of the definitive share exchange agreement previously entered into by the Company

On April 30, 2019, we consummated the transactions

contemplated by the Share Exchange Agreement dated as of November 2, 2018, by and among us, Kaixin and Renren.

Upon the closing

of the Acquisition, Kaixin Auto Holdings (“KAH”) acquired 100% of the issued and outstanding securities of Kaixin in

exchange for approximately 28.3 million ordinary shares of KAH.

An additional 4.7 million shares of KAH is reserved for issuance

under an equity incentive plan in exchange for outstanding options in Kaixin.

A total of 20,403,667 shares of KAH ordinary

shares were redeemed upon consummation of the Acquisition at a redemption price of approximately $10.37 per share into cash of

KAH’s ordinary shares.

On the transaction closing date, KAH, Kaixin,

Renren and SVF executed an agreement (the “Waiver Agreement”) pursuant to which Kaixin and Renren waived certain rights

under the Share Exchange Agreement in exchange for SVF’s commitment (i) to contribute $1.6 million to KAH within two weeks

after the closing of the Merger, (ii) to set a limit on the liabilities to be paid by cash (up to US$4.0 million) and noncash (up

to US$2.6 million) consideration by KAH and (iii) to within one month use its best efforts to restructure the loans it has extended

Also, on the transaction closing date,

KAH paid $2 million in cash and issued a $1.5 million note payable to Early Bird Capital (“EBC”) in fees related to

the Acquisition.

Accounting for the Acquisition

The Business Combination is accounted for

as a “reverse merger”

in accordance with U.S.

Under this method of accounting the Company will be treated as

the “acquired”

company for financial reporting purposes.

This determination is primarily based on the fact that subsequent

to the Business Combination, Kaixin securityholders obtained a majority of the voting power of the combined company, Kaixin comprising

all of the ongoing operations of the combined entity, Kaixin comprising a majority of the governing body of the combined company,

and Kaixin’s senior management comprising all of the senior management of the combined company.

Accordingly, for accounting

purposes, the Business Combination is treated as the equivalent of Kaixin issuing shares for the net assets of the Company, accompanied

by a recapitalization.

The net assets of the Company will be stated at fair value which approximates historical costs as the Company

has only cash and short-term liabilities.

No goodwill or other intangible assets were recorded.

Operations prior to the Business

Combination will be those of Kaixin

Results of Operations

Our entire activity from inception up to

October 30, 2017 was related to the Company’s formation, the IPO and general and administrative activities.

Since the IPO,

our activity has been limited to the evaluation of business combination candidates, and we will not be generating any operating

revenues until the closing and completion of our initial business combination.

We expect to generate non-operating income in the

form of interest income on cash and investments held in Trust Account.

We expect to incur increased expenses as a result of being

a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

expect our expenses to increase substantially after this period.

For the three months ended September 30,

2018, we had net income of $828,104, which was comprised of operating costs of $177,984 and interest income of $1,006,088 from

investments in our Trust Account and interest from our savings account.

For the three months ended September 30, 2017, we incurred

operating costs of $2,612 and interest income of $41 from our savings account.

For the nine months ended September 30,

2018, we had net income of $2,145,766, which was comprised of operating costs of $431,786, realized loss from sale of investments

of $97,758, and interest income of $2,675,310 from investments in our Trust Account and interest earned on our savings account.

For the nine months ended September 30, 2017, we incurred net operating costs of $4,991.

Our entire activity from inception through

March 31, 2019 was related to the Company’s formation, the IPO and general and administrative activities.

From the IPO through

March 31, 2019, our activity was limited to the evaluation of business combination candidates and preparation for our business

combination, and we did not generate any operating revenues until the closing and completion of our initial business combination

on April 30, 2019.

We generated small amounts of non-operating income in the form of interest income on cash and cash equivalents.

Interest income was significant in view of our investment in U.S.

Treasury Bills from our Trust fund.

We incurred increased expenses

as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due

diligence expenses incurred for our merger and acquisition related activities.

For the three months ended March 31, 2019

and 2018, we had a net income of $726,483 and $527,701, respectively.

The formation and operating costs (not charged against shareholders’

equity) for the three months ended March 31, 2018 was $464,129, an increase of $352,344, from $111,785 for the three months ended

March 31, 2018.

The increase was mainly caused by the increase in professional fees related to our merger and acquisition related

The interest income from investments in our Trust Account for the three months ended March 31, 2019 was $1,190,612,

an increase of $453,368, from $737,244 for the three months ended March 31, 2018.

The increase was mainly due to improved yields

in investments and higher investment balance during the three months ended March 31, 2019 as compared to the comparative 2018 period.

Realized loss from sale of investments was $-0- for the three months ended March 31, 2019 as compared to $97,758 for the three

months ended March 31, 2018.

We incurred a realized loss from sale of investments of $97,758 during the three months ended March

31, 2018, but did not incur such loss during 2019.

Liquidity and Capital Resources

As of September 30, 2018, we had cash outside

As of March 31, 2019, we had cash outside

our trust account of $53,980, available for working capital needs.

All remaining cash was held in the trust account and is generally

All remaining cash was held in the trust account and was generally

unavailable for our use, prior to an initial business combination.

Our liquidity needs have been satisfied

to date through receipt of $31,038 from the sale of the insider shares, advances from our Sponsor and an affiliate of our Sponsor

in an aggregate amount of $663,009, which were repaid upon our IPO, and the remaining net proceeds from our IPO and Private Placements.

Additionally, on May 23, 2018, our sponsor loaned to us $500,000 pursuant to a non-convertible non-interest bearing promissory

note, which will be repaid promptly after the date on which we consummate a business combination.

In the event that we are unable

to consummate a business combination, as described in the prospectus relating to the IPO, the balance of such note will be forgiven

and our Sponsor will not be entitled to any payment thereunder.

We intend to use substantially all of the

net proceeds of the IPO, including the funds held in the trust account to acquire a target business or businesses and to pay our

expenses relating thereto, including a cash fee equal to 3.5% of the gross proceeds of the IPO payable to the representative of

the underwriters upon consummation of our initial business combination for assisting us in connection with such business combination.

To the extent that our share capital is used in whole or in part as consideration to effect our initial business combination, the

remaining proceeds held in the trust account as well as any other net proceeds not expended will be used as working capital to

finance the operations of the target business.

Such working capital funds could be used in a variety of ways including continuing

or expanding the target business’

operations, for strategic acquisitions and for marketing, research and development of existing

or new products.

Such funds could also be used to repay any operating expenses or finders’

fees which we had incurred prior

to the completion of our initial business combination if the funds available to us outside of the trust account were insufficient

to cover such expenses.

We anticipate that the approximately $374,955

outside of our trust account as of September 30, 2018, will be insufficient to cover our operating costs and our estimated costs

of undertaking our initial business combination.

If the Company is required to pay these costs prior to the initial business combination

closing, then the Company will need to obtain additional financing to consummate our initial business combination.

Either in order

to raise such additional financing, or because we become obligated to redeem a significant number of our public shares upon consummation

of our initial business combination, in either case we may issue additional securities or incur debt in connection with such business

Subject to compliance with applicable securities laws, we would only consummate such financing simultaneously with

the consummation of our initial business combination.

Following our initial business combination, if cash on hand is insufficient,

we may need to obtain additional financing in order to meet our obligations but there is no assurance that new financing will

be available to us on commercially acceptable terms.

Furthermore, if we are not able to consummate a business combination within

15 months from our IPO, which is approximately three months from the date of this filing, we may exercise our option to extend

the timeframe for an additional three months, which would require us to deposit into the trust account $2,063,629 (an additional

$0.10 per IPO share), or commence an automatic winding up, dissolution and liquidation.

These conditions raise substantial doubt

about our ability to continue as a going concern.

through March 31, 2019 through receipt of $31,038 from the sale of the insider shares, advances from our sponsor and an affiliate

of our sponsor in an aggregate amount of $663,009, which were repaid upon our IPO and not outstanding as of December 31, 2017,

and the remaining net proceeds from our IPO and Private Placements as well as the additional funding from our sponsor (see below).

Additionally, on April 9, 2018, our sponsor

agreed to loan to us an additional $500,000 pursuant to a non-convertible non-interest-bearing promissory note, which will be repaid

promptly after the date on which we consummate a business combination.

In the event that we are unable to consummate a business

combination, as described in the prospectus relating to the IPO, the balance of such note will be forgiven and our sponsor will

not be entitled to any payment thereunder.

On January 24, 2019 we issued an unsecured

promissory note in the aggregate principal amount of up to $1,100,000 to our sponsor.

We may request funds from our sponsor under

the note from time to time.

The note does not bear interest and matures upon closing of a business combination.

Thereafter, the

total of all Sponsor loans to us was $1,600,000.

In the event that we are unable to consummate a business combination, as described

in the prospectus relating to the IPO, the balance of such note will be forgiven and our sponsor will not be entitled to any payment

On January 24, 2019 our sponsor and Kaixin

extended the time available to us to complete a business combination to April 30, 2019 by depositing $2,063,629 into our trust

In conjunction with the extension, we issued unsecured promissory notes in the aggregate principal amount of $2,063,629

to our sponsor and Kaixin in exchange for those entities depositing such amount into the Company’s trust account.

do not bear interest and mature upon closing of a business combination by us.

In addition, the notes may be converted by the holder

into our units (identical to the units issued in our initial public offering) at a price of $10.00 per unit.

On January 28, 2019, Kaixin, KAH and an

investor entered into a convertible loan agreement pursuant to which the investor has agreed to invest US$23 million into Kaixin

with interest payable at the loan interest rate as stipulated by the People’s Bank of China.

An additional penalty interest

rate will apply for unremitted amounts in the event of a default.

US$20 million of the loan was advanced to Kaixin on January 28,

2019, and the remaining US$3 million is to be advanced to Kaixin on January 31, 2020.

Upon completion of the Transactions, the

loan was converted into 2,000,000 units, each unit consisting of one and one tenths ordinary shares and one half of a redeemable

The securities were issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, as the transactions

did not involve a public offering.

On January 29, 2019, KAH entered into a

subscription agreement with one accredited investor to sell 750,000 of its units (each unit having the same underlying securities

as were issued in KAH’s initial public offering) at a price of $10.00 per unit.

The closing took place at the closing of

the Transactions.

The investor received certain demand and piggyback registration rights pursuant to the terms of the subscription

The securities were issued pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, as the transactions

did not involve a public offering.

On April 25, 2019, Kaixin, KAH and an investor

entered into a convertible loan agreement pursuant to which the investor agreed to invest US$1 million into Kaixin with interest

payable at the loan interest rate as stipulated by the People’s Bank of China.

Upon completion of the Transactions, the loan

was converted into 100,000 ordinary shares.

The securities were issued pursuant to Section 4(a)(2) of the Securities Act of 1933,

as amended, as the transactions did not involve a public offering.

On April 30, 2019, we consummated the transactions

contemplated by the Share Exchange Agreement.

The Business Combination was approved at a special meeting of shareholders of CM

Seven Star Acquisition Corp.

on April 24, 2019, and subsequently CM Seven Star Acquisition Corp.

was renamed as Kaixin Auto Group.

Off-Balance Sheet Financing Arrangements

As of September 30, 2018, we did not have

any off-balance sheet arrangements.

As of March 31, 2019, we did not have any

off-balance sheet arrangements.

We have no obligations, assets or liabilities which would be considered off-balance sheet arrangements.

4 unchanged sentences

Contractual Obligations

At September 30, 2018, we did not have any long-term debt, capital

At March 31, 2019, we did not have any long-term debt, capital

lease obligations, operating lease obligations or long-term liabilities.

14 unchanged sentences

Quantitative and Qualitative Disclosures about Market

As a smaller reporting company we are not required to make disclosures

under this item.

As a smaller reporting company, we are not required to make

disclosures under this item.

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. Financial Statements