Financial Reporting and Internal Controls - The company has experienced ineffective internal control over financial reporting, leading to the restatement of financial statements[383] - The company has been advised that its internal controls over financial reporting are currently ineffective, as evidenced by the restatement of financial statements[411] - The company has identified weaknesses in its internal controls over financial reporting, which could lead to material misstatements and loss of investor confidence[468] - The company is not required to evaluate the effectiveness of its internal control over financial reporting until after filing its Annual Report on Form 10-K for the years ending December 31, 2023, and December 31, 2022[527] Financial Performance and Projections - The company incurred a net loss of approximately $(9.4) million for the year ended December 31, 2023, compared to a net loss of $(6.4) million for the year ended December 31, 2022[402] - As of December 31, 2023, the company had an accumulated deficit of approximately $(38.9) million, up from $(29.6) million as of December 31, 2022[402] - The company anticipates continued operating losses and cash usage through the foreseeable future, necessitating significant additional capital[402] - The company believes its current cash and net proceeds from debt issuances will be sufficient to fund working capital requirements beyond the next 12 months, assuming successful equity financing[402] Regulatory and Compliance Risks - The company is subject to various foreign and domestic laws regarding user privacy and data protection, which could increase compliance costs and affect business operations[385] - The introduction of new regulations, such as the GDPR and CCPA, may impose additional operational requirements and increase costs for the company[386] - Compliance with laws governing anti-money laundering and electronic funds transfer may require significant management resources and could lead to penalties if violated[387] - The company is exposed to potential fines and penalties under the U.S. Foreign Corrupt Practices Act, which could adversely affect its business[388] - The company faces risks related to government regulations that could restrict access to its services in certain countries, impacting user growth and engagement[385] - The company is subject to scrutiny by the Korean Fair Trade Commission regarding its business relationships and transactions with subsidiaries, which may lead to administrative fines if violations are found[417] - The company is committed to compliance with anti-corruption laws, but violations could result in substantial fines and damage to its reputation[445] - Regulatory changes regarding digital assets could negatively impact the company's operations and prospects[454] - The company is subject to various regulations in South Korea, which may affect its operations and the issuance of digital assets[455] Currency and Economic Risks - A significant portion of the company's revenue and costs are denominated in Korean Won, which may adversely affect liquidity and cash flows due to currency fluctuations[389] - Fluctuations in the exchange rate between the Korean Won and the U.S. dollar could materially impact the company's operational costs and financial results[389] - The company is exposed to fluctuations in exchange rates due to foreign subsidiaries' accounts maintained in local currencies[524] - The company is at risk of adverse effects from developments in the Korean economy, which could impact customer spending and revenue growth[392] Operational Challenges and Investments - The company expects to continue investing heavily in product development and operations, particularly focusing on the FANTOO platform to increase its user base[402] - The company relies on interoperability with mobile operating systems like Android and iOS, which it does not control, potentially affecting user growth and engagement[421] - The company’s products depend on complex software and hardware systems, and any errors or vulnerabilities could lead to negative user experiences and financial losses[423] - The company anticipates ongoing efforts related to privacy and security will identify misuse of user data, which could impact user trust and engagement[422] - The company has faced challenges related to copyright and patent infringement, which could result in sanctions or penalties affecting its operations in Korea[392] - Rapid technological changes in the social media market require the company to continuously adapt, with risks associated with the adoption of new technologies[450] Stock and Market Risks - The company is facing potential delisting from Nasdaq due to failure to comply with continued listing requirements, including timely filing of reports and maintaining a minimum bid price of $1.00 per share[460] - The company received a delinquency compliance alert from Nasdaq for not timely filing its Quarterly Report for Q1 2024 and Annual Report for 2023, with a deadline to submit a compliance plan by June 17, 2024[460] - If the compliance plan is accepted, the company may have an extension of up to 180 days to regain compliance, until October 14, 2024[460] - The trading price of the company's common stock may fluctuate significantly, influenced by market conditions and factors beyond its control[461] - Future issuances of debt or preferred stock may adversely affect the returns for common stockholders[463] - The company has not paid cash dividends in the past and does not expect to do so in the foreseeable future, limiting returns to stock price appreciation[463] - The company does not expect to pay dividends in the foreseeable future, relying instead on stock price appreciation for returns[469] Cybersecurity and Information Security - The company may face significant costs related to cybersecurity incidents, which could adversely affect its business and reputation[460] - The company has an information security program in place to manage cybersecurity risks, but there are no assurances of its effectiveness[471] Growth Potential - The company has significant potential for user base growth due to the popularity of K-Culture, which generated approximately $21.5 billion in global revenue in 2019[444] - The company may experience intellectual property infringement claims, which could divert resources and incur legal costs[457] - The company expects significant legal, accounting, and compliance costs as it transitions to a public company, particularly after losing its emerging growth company status[465] - The company may take advantage of scaled disclosures available to smaller reporting companies, which could affect the attractiveness of its common stock to investors[468]

Core Viewpoint - Hanryu Holdings, Inc. has received a delinquency compliance alert from Nasdaq due to its failure to timely file required financial reports, which puts the company at risk of non-compliance with Nasdaq's listing requirements [1][2] Group 1: Compliance Issues - The company failed to file its Quarterly Report on Form 10-Q for the period ended March 31, 2024, and is also delinquent in filing its Form 10-K for the year ended December 31, 2023 [1] - Nasdaq has provided the company until June 17, 2024, to submit a plan to regain compliance with its listing requirements [2] - If the plan is accepted, the company may receive an extension of up to 180 days to regain compliance, potentially until October 14, 2024 [2] Group 2: Company Overview - Hanryu Holdings, Inc. is a media-tech company known for its social media platform, FANTOO, which connects global fans of K-culture [3] - FANTOO offers a unique multimedia platform for users to interact, share content, and engage in commerce within a fandom community [3]

User Growth and Market Opportunity - FANTOO platform has exceeded 27 million users since its launch in May 2021, primarily driven by the popularity of K-Culture[227]. - The global purchasing power of K-Culture was estimated at $124.3 billion in 2020, indicating a substantial market opportunity for FANTOO[234]. Financial Performance - Revenue for the nine months ended September 30, 2023, was $1,347,975, representing a 49% increase from $904,040 in the same period of 2022[247]. - Net loss for the nine months ended September 30, 2023, was $9,163,826, an increase of 82% from a net loss of $5,038,818 in 2022[247]. - The gross profit margin decreased to 38% for the nine months ended September 30, 2023, down from 49% in 2022[248]. - Other income decreased by $66,231 or 27% to $176,906 for the nine months ended September 30, 2023, primarily due to a prior gain on extinguishment of debt recognized in 2022[255]. Expenses and Cost Management - Cost of revenue increased by 80% to $832,915 for the nine months ended September 30, 2023, compared to $463,586 in 2022[249]. - Marketing and advertising expenses surged by 533% to $1,914,786 for the nine months ended September 30, 2023, up from $302,688 in 2022[247]. - General and administrative expenses increased by $2,479,654 or 48% to $7,646,654 for the nine months ended September 30, 2023, mainly due to higher commissions and consulting costs[253]. - Research and development expenses rose to $277,624 for the nine months ended September 30, 2023, compared to $231,697 in 2022, driven by increased personnel costs related to the upgraded FANTOO app[252]. Cash Flow and Financing - Net cash used in operating activities was $11,444,953 for the nine months ended September 30, 2023, compared to $3,421,125 in 2022, reflecting a net loss of $9,163,826[265]. - Net cash provided by financing activities was $23,566,502 for the nine months ended September 30, 2023, significantly up from $1,715,561 in 2022, driven by increased proceeds from issuing common stock and exercising warrants[267]. - The company completed its IPO in July 2023, raising gross proceeds of $8,174,860 from the sale of 877,328 shares at $10.00 per share, with net proceeds of approximately $6.8 million after expenses[260]. Debt and Obligations - As of September 30, 2023, the company had outstanding convertible debt of approximately $3,346,222, a decrease from $3,550,856 at the end of 2022[268]. - The company has fixed contractual obligations totaling $165,345, with $32,682 due within one year and $132,663 due in 1-3 years[271]. Currency Risk and Financial Reporting - The company is exposed to foreign currency risk, particularly with the Korean Won (KRW), which affects its financial position due to fluctuations in exchange rates[276][278]. - A hypothetical 10% adverse change in average exchange rates would have resulted in a decline in total net revenues of $122,543 and a change in net loss of $833,075 for the nine months ended September 30, 2023[278]. - The company expects to become a public reporting company under the Exchange Act and will report as an "emerging growth company" for up to five years, unless the market value of its common stock held by non-affiliates exceeds $700 million[290][292]. - The company will benefit from relaxed ongoing public reporting requirements, which are less rigorous than those for non-emerging growth companies, potentially resulting in less information for stockholders[291]. Future Plans and Revenue Streams - The company anticipates generating revenue from user-to-user transactions, which is expected to become a significant revenue stream in the long term[232]. - FANTOO plans to roll out a premium ERP service option for clients, which will be available for a subscription fee[239]. - The entertainment agency business, FANTOO Entertainment, is expected to start generating revenue by 2024 through advertisement agreements and performance-based contracts[240]. Accounting and Estimates - The preparation of financial statements requires management to make estimates and assumptions that could differ from actual results, impacting reported amounts of assets and liabilities[282]. - The company plans to evaluate the impact of recent accounting pronouncements, including ASU 2016-13 and ASU 2020-06, on its consolidated financial statements in future periods[284][286].

User Base and Revenue Growth - FANTOO platform's user base has exceeded 27 million since its launch in May 2021, primarily driven by the popularity of K-Culture[214] - Revenue for the six months ended June 30, 2023, was $630,973, a 435% increase from $117,964 in the same period in 2022[234] - Gross profit for the six months ended June 30, 2023, was $241,911, representing a 257% increase from $67,725 in 2022[234] Cost and Expenses - Cost of revenue for the same period increased to $389,062, up 674% from $50,239 in 2022, reflecting the substantial growth in revenue[234][236] - Marketing and advertising expenses rose to $832,800, a 351% increase from $184,457 in the previous year[234] - Research and development expenses increased to $231,743, up 192% from $79,485 in 2022[234] - General and administrative expenses were $4,974,991, a 36% increase from $3,664,609 in the same period last year[234] - Marketing and advertising expenses for the six months ended June 30, 2023, increased to $832,800 from $184,457 in the same period of 2022, primarily due to the launch of the FANTOO platform[238] - Research and development expenses rose to $231,743 for the six months ended June 30, 2023, compared to $79,485 in 2022, driven by increased personnel costs related to the upgraded FANTOO app[239] - General and administrative expenses increased by $1,310,382 or 36% to $4,973,000 for the six months ended June 30, 2023, mainly due to higher commissions and consulting costs[240] Cash Flow and Financing Activities - Net cash used in operating activities for the six months ended June 30, 2023, was $6,313,522, reflecting a net loss of $6,059,252[252] - Net cash provided by financing activities was $15,796,985 for the six months ended June 30, 2023, significantly up from $838,077 in the same period of 2022[254] - The company completed its IPO on July 2023, selling 877,328 shares at $10.00 per share, generating gross proceeds of $8,773,280, with net proceeds of approximately $6.8 million after expenses[248][249] - The company reported a decrease in cash provided by investing activities to $7,053,691 for the six months ended June 30, 2023, a decline of 798.92% compared to the previous year[253] Financial Obligations and Risks - As of June 30, 2023, the remaining outstanding principal amount of bonds with warrants was approximately $3,427,788, down from $3,550,856 at the end of 2022[255] - The company has fixed contractual obligations totaling $164,978, with $106,321 due within one year[258] - The company is exposed to foreign currency risk, particularly with fluctuations in the Korean Won (KRW) against the USD, which can impact financial results[265][266] - The company is exposed to market risks primarily due to fluctuations in foreign currency and credit, impacting its financial position[263] - A hypothetical 10% adverse change in average exchange rates would have resulted in a decline in total net revenues of $48,000 and a change in net loss of $1.2 million for the year ended December 31, 2021[267] - The company generates the majority of its revenue from customers within Korea, which makes it vulnerable to KRW volatility against foreign currencies[266] Company Status and Reporting - The company expects to remain an "emerging growth company" for up to five years, unless the market value of its common stock held by non-affiliates exceeds $700 million[280] - The company will adopt the provisions of ASU 2016-02 related to leases starting January 1, 2022, which requires recognition of a single lease cost allocated over the lease term[273] - The company may take advantage of reporting exemptions applicable to "emerging growth companies," resulting in less rigorous ongoing public reporting requirements[279] - The company evaluates contingent liabilities related to legal proceedings and may disclose potential losses if they are reasonably possible or probable but cannot be estimated[276] - The company places cash and cash equivalents with financial institutions of high credit quality to manage credit risk[269] - The company’s functional and reporting currency is USD, while its primary operating subsidiaries use KRW, leading to translational exposure[267] - The company is currently evaluating the impact of ASU 2020-06 on its consolidated financial statements, which changes the accounting for convertible instruments[274]

(Exact name of registrant as specified in its charter) As filed with the Securities and Exchange Commission on July 26, 2023 Registration No. 333-269419 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 14 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 HANRYU HOLDINGS, INC. (State or other jurisdiction of (Primary Standard Industrial Delaware 7370 88-1368281 (I.R.S. Employer Identification Number) 160, Yeouiseo-ro, Yeongdeungpo-gu, Seoul, Republic of Kor ...

As filed with the Securities and Exchange Commission on July 11, 2023 Registration No. 333-269419 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 13 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ____________________ HANRYU HOLDINGS, INC. (Exact name of registrant as specified in its charter) ____________________ Delaware 7370 88-1368281 (State or other jurisdiction of (I.R.S. Employer +82-2-564-8588 (Address, including zip code, and telephone number, ...

As filed with the Securities and Exchange Commission on July 7, 2023 Registration No. 333-269419 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 12 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ____________________ HANRYU HOLDINGS, INC. (Exact name of registrant as specified in its charter) ____________________ | Delaware | 7370 | 88-1368281 | | --- | --- | --- | | (State or other jurisdiction of | (Primary Standard Industrial | (I.R.S. Employer | (St ...

As filed with the Securities and Exchange Commission on June 21, 2023 Registration No. 333-269419 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 11 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ____________________ HANRYU HOLDINGS, INC. (Exact name of registrant as specified in its charter) ____________________ Delaware 7370 88-1368281 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) (Primary Standard Industrial Classif ...

AMENDMENT NO. 10 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 HANRYU HOLDINGS, INC. (Exact name of Registrant as specified in its charter) As filed with the Securities and Exchange Commission on June 8, 2023. Registration No. 333-269419 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Chang-Hyuk Kang Chief Executive Officer Hanryu Holdings, Inc. ...

As filed with the Securities and Exchange Commission on June 2, 2023 Registration No. 333-269419 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 9 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ____________________ HANRYU HOLDINGS, INC. (Exact name of registrant as specified in its charter) ____________________ Delaware 7370 88-1368281 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) (Primary Standard Industrial Classific ...