UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO Commission File Number: 001-39445 MSP Recovery, Inc. (Exact name of Registrant as specified in its Charter) Delaware 84-4117825 (State or other jurisdiction of ...

Company Overview - SFHG's fiscal year ends on December 31[21] - The company operates through its subsidiaries in Hong Kong and the PRC, specifically Samfine HK, Samfine SZ, and Samfine SZ Technology[20] - The reporting currency for SFHG is HKD, with translations to U.S. dollars calculated at a rate of US$1 = HK$7.7677 as of December 31, 2024[20] - The company is classified as an emerging growth company[13] Regulatory and Compliance Risks - The audit report is prepared by U.S. auditors subject to PCAOB inspections, but future inspections may be affected by political changes between mainland China and Hong Kong[34] - The company faces risks related to potential delisting from U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years[40] - The SEC has implemented rules under the HFCA Act that may require additional disclosures from companies whose auditors cannot be inspected by the PCAOB[39] - The company must comply with new SEC rules if identified as having a "non-inspection" year under the HFCA Act[39] - The company is subject to various risks that could materially affect its financial condition and results of operations[32] - PCAOB determined it could secure complete access to inspect registered public accounting firms in mainland China and Hong Kong as of December 15, 2022[44] - The Consolidated Appropriations Act mandates the SEC to prohibit trading of an issuer's securities on U.S. exchanges if its auditor is not PCAOB inspected for two consecutive years[45] - Regulatory developments in the PRC may lead to increased compliance costs and additional disclosure requirements for companies operating in Hong Kong and mainland China[48] - The PRC Data Security Law requires data collection to be conducted legitimately and mandates a data classification and protection system[50] - Stricter labor laws in the PRC may adversely affect the business operations and financial results of the company's subsidiaries[53] - The Hong Kong National Security Law could materially impact the operations and financial position of the company's Hong Kong subsidiary[60] - Increased scrutiny of U.S.-listed Chinese companies has led to significant declines in stock value and potential shareholder lawsuits[59] - The SEC and PCAOB have highlighted challenges in overseeing financial audits of U.S.-listed companies with significant operations in the PRC[56] - The company may face penalties for inadequate contributions to employee benefit plans as required by PRC regulations[52] Economic and Political Risks - Economic downturns or changes in PRC policies could materially affect the company's business and financial condition[63] - Economic conditions in Hong Kong and the PRC are sensitive to global economic conditions, with potential negative impacts on business and financial condition due to prolonged slowdowns[64] - The PRC government’s political and economic policies significantly affect the company’s growth and expansion strategies, with uncertainties in U.S.-China relations posing risks[65] - The PRC economy has experienced uneven growth, and government measures to control economic activity, such as interest rate adjustments, may adversely affect the company’s operations[67] - Tariffs and international trade disputes could increase costs and negatively impact customer confidence, affecting the company’s business operations[73] - The PRC government’s control over capital investments and changes in tax regulations could materially affect the company’s financial condition and results of operations[79] - The legal system in the PRC presents uncertainties that could adversely affect the company’s operations and ability to enforce contractual rights[84] - The company’s operations in Hong Kong are subject to political risks, including potential changes in the economic and legal environment that could impact business stability[69] - The PRC's evolving legal framework may restrict foreign investments, creating challenges for the company in navigating regulatory compliance[85] Financial Performance and Risks - For the year ended December 31, 2024, three customers accounted for 27.9%, 25.8%, and 23.6% of total revenue, indicating significant customer concentration risks[101] - One vendor accounted for 18.7% of total purchases for the year ended December 31, 2024, highlighting dependency on major suppliers[102] - Operating subsidiaries do not enter into long-term contracts, leading to potential fluctuations in sales based on customer demand[99] - The production base in Shenzhen is critical; any operational disruptions could significantly impact the ability to meet delivery schedules[104] - The company anticipates that the provision of printing services to Hong Kong-based book traders will continue to represent most of its revenue in the near future[100] - Operating subsidiaries face challenges from technological advancements and increased digitalization, which may reduce demand for printed products[105] - The company has continuously upgraded production facilities to enhance competitiveness, but failure to keep pace with technological developments may adversely affect operations[106] - The competitive landscape in the printing service industry is highly fragmented, with larger competitors potentially having advantages in technology and capital access[107] - Under PRC laws, dividends can only be paid out of accumulated profits, with at least 10% of after-tax profits required to be set aside as a statutory reserve[94] - Any limitations on the ability of subsidiaries to pay dividends could materially affect the company's growth and investment capabilities[97] - The operating subsidiaries experience significant revenue fluctuations due to seasonality, with lower revenue in Q1 and higher revenue in Q4, driven by customer inventory increases ahead of holidays[108] - A decline in the financial condition of customers may adversely affect cash flows and working capital, increasing exposure to credit risks and allowances for doubtful receivables[109] - The operating subsidiaries face risks related to payment deferrals by customers, which could impact financial condition and operational results[110] - Data transfer risks in the production process may lead to discrepancies in printing products, potentially resulting in additional costs or loss of revenue[111] Operational and Management Risks - The operating subsidiaries have obtained all necessary licenses and permits for operations, but there is no assurance of timely renewal, which could adversely affect business operations[120] - The company relies on key management for operations, and loss of key personnel may impact business performance[121] - Quality of raw materials is critical; failure to meet specifications could lead to delivery delays and loss of orders[122] - The company may face litigation risks, which could result in significant costs and reputational harm[123] - The company holds 18 patents in the PRC, but faces challenges in safeguarding intellectual property rights and potential infringement claims[125] - The company may need to obtain licenses for disputed intellectual property, which could disrupt business if not secured on reasonable terms[126] - The operating subsidiaries generated revenue primarily from printing products for book traders in Hong Kong, with a focus on markets in the U.S. and Europe[139] - The company faces risks from natural disasters, health epidemics, and geopolitical issues that could disrupt operations and adversely affect financial performance[134][135] - The global economic downturn, exacerbated by the COVID-19 pandemic, has led to increased market volatility and diminished expectations for economic growth[136] Shareholder and Governance Issues - The company's largest shareholder holds approximately 69.97% of the voting power, which may lead to actions not in the best interests of other shareholders[143] - Future business plans may be hindered by competition, financial risks, and operational challenges, potentially affecting growth and performance[131] - The company may pursue acquisitions and joint ventures as part of its growth strategy, which could introduce new risks and integration challenges[132] - The internal control system may not be adequate to address all risks, potentially impacting financial condition and operational results[133] - The market price of the company's ordinary shares may experience significant volatility, making it difficult for investors to assess value[142] - The board of directors has complete discretion over dividend distributions, which may depend on future financial performance and conditions[147] - The company is classified as a "controlled company," which may allow it to follow exemptions from certain corporate governance requirements[146] - The company does not intend to pay dividends for the foreseeable future, opting to retain future earnings for business operations and expansion[151] - The company qualifies as a foreign private issuer, which allows for less detailed and less frequent reporting compared to U.S. domestic companies[163] - If the company loses its foreign private issuer status, it would face increased regulatory and compliance costs, as well as potential changes in corporate governance practices[164] - The company is subject to periodic reporting requirements under the Exchange Act, but its disclosure controls may not prevent all errors or acts of fraud[149] - There is uncertainty regarding the enforcement of foreign judgments against the company or its directors in jurisdictions like China and Hong Kong[156][157] - Shareholders of the company have limited rights under Cayman Islands law to access corporate records, which may complicate shareholder actions[159] - The company’s board of directors has discretion over dividend distribution, subject to Cayman Islands law requirements for solvency[151] - The company may face challenges in attracting research coverage from securities analysts, which could impact its share price and trading volume[152] - The company’s operations are primarily conducted in Mainland China and Hong Kong, which may complicate legal processes for shareholders[153] - The company is not required to satisfy the economic substance test under Cayman Islands law as long as it is tax resident outside the Cayman Islands[162] IPO and Financial Transactions - The company closed its IPO on October 16, 2024, raising total gross proceeds of $8,000,000 from the sale of 2,000,000 Ordinary Shares at $4.00 per share[177] - Following the IPO, the underwriters exercised an over-allotment option, resulting in additional gross proceeds of $1,200,000 from 300,000 Ordinary Shares[177] - The total net proceeds from the IPO, after deducting underwriting discounts and commissions, amounted to approximately HK$63.9 million (US$8.2 million)[177] - The company incurred approximately HK$18.6 million (US$2.4 million) in total offering expenses during the IPO process[177] - The authorized share capital was increased to US$50,000 divided into 800,000,000 Ordinary Shares following a 1-to-1.6 share split[176] Product and Service Offerings - The company operates as a one-stop printing service provider, offering a wide range of printed products including children's books, educational books, and packaging products[182] - The company emphasizes high-quality printing services and has implemented a stringent quality control system throughout its production process[184] - The company has extensive experience in customized and personalized book printing, catering to diverse customer needs[183] - The company has diversified its product offerings, including children's books, educational books, and novelty packaging products[189] - The company does not own any real property and relies on leased facilities for its operations[199] - The company maintains a good working relationship with suppliers and has a well-diversified supplier base to mitigate concentration risk[213] - The company does not enter into long-term contracts with customers, relying instead on individual orders[210] - The production capacity at the company's facilities increased due to investments in additional machines and equipment[203] - The company has not experienced material labor disputes and maintains a good relationship with its employees[216] - The Shenzhen Factory has a total of 6 multi-color printing presses, enhancing the company's production capacity[203] - The company employed 216 full-time employees as of December 31, 2024, a slight decrease from 221 in 2023[214] - The company recorded a lower revenue in the first quarter of each calendar year due to the Chinese New Year holiday, while the fourth quarter typically sees increased demand[217]

Production and Revenue - For the year ended December 31, 2024, the average daily production was 798 BOE per day, a decrease of 22% from 1,022 BOE per day in 2023[333]. - Oil production for the year ended December 31, 2024, was 256 MBbl, down 27% from 349 MBbl in 2023, while natural gas production decreased from 355 MMcf in 2023 to 213 MMcf in 2024[347]. - Total revenues for the year ended December 31, 2024, were $19,418,919, a 15% decrease from $24,238,482 in 2023, primarily due to a 28% decrease in production volumes[346]. Pricing and Costs - The average realized oil price per barrel after reflecting settled derivatives was $73.61 for the year ended December 31, 2024, compared to $69.06 for 2023, reflecting a 6% increase[340]. - The company's oil price differential to the NYMEX benchmark was $(1.03) per barrel in 2024, an improvement from $(4.95) per barrel in 2023[335]. - Lease operating expenses for the year ended December 31, 2024, were $8,614,080, with a per BOE increase of 19% to $29.59 due to higher maintenance and labor costs[351]. - Production taxes, transportation, and processing costs were $1,715,792 for 2024, representing 8.7% of oil and natural gas sales, consistent with 8.9% in 2023[352]. Financial Performance - The company recorded a loss on derivative contracts of $850,374 for the year ended December 31, 2024, compared to a gain of $392,765 in 2023[349]. - Depletion, depreciation and amortization (DD&A) increased to $2,407,098 for the year ended December 31, 2024, from $1,849,876 in 2023, with a DD&A rate of $8.27 per BOE, up 48% from $4.53 per BOE in 2023[353]. - Accretion expense decreased to $144,988 in 2024 from $859,102 in 2023, with a per BOE cost of $0.50 compared to $2.32 in 2023, driven by changes in inflation and discount rate assumptions[354]. - General and administrative expenses rose to $10,381,095 in 2024 from $7,253,384 in 2023, including stock-based compensation of $2,778,991[355]. - Interest expense increased significantly to $7,643,200 in 2024 from $1,043,312 in the Successor period of 2023, primarily due to the Senior Secured Term Loan[357]. - The company reported a positive cash flow from operations of $3,700,686 for the year ended December 31, 2024, compared to $484,474 in the Successor period of 2023[368]. Debt and Liabilities - As of December 31, 2024, the company had outstanding debt of $23,641,517 under the Senior Secured Term Loan and a working capital deficit of $31,213,674[365]. - The company recognized a gain on extinguishment of liabilities of $1,638,138 during the year ended December 31, 2024, including a gain of $1,720,000 related to the settlement of royalties payable[360][361]. - The change in fair value of warrant liabilities resulted in a loss of $804,004 in 2024, compared to a gain of $187,704 in the Successor period of 2023[362]. Investments and Equity - Net cash used in investing activities for 2024 was primarily due to the development of crude oil and gas properties, with significant cash outflows in the previous year for compliance upgrades[370]. - The company has a three-year equity line with a maximum funding limit of $150,000,000, having received $6,992,906 in cash proceeds from the sale of 7,000,000 shares under this agreement[367]. Risk Management - The Company uses derivative financial instruments to mitigate commodity price risk, with fair value changes recognized in consolidated statements of operations[386]. - Realized and unrealized gains and losses from derivative financial instruments are reported as a component of revenues in the consolidated statements of operations[386]. - Cash flows from derivative contract settlements are reflected in operating activities in the consolidated statements of cash flows[386]. - The Company records liabilities for ongoing litigation and environmental remediation, with actual costs potentially varying from estimates due to legal interpretations and regulatory changes[384]. - The fair value of the Forward Purchase Agreement liability was estimated using a Monte-Carlo Simulation, considering future stock price simulations and contractual terms[385]. - The Company is classified as a smaller reporting company and is not required to provide additional market risk disclosures[388].

Production and Revenue - Average daily production for the year ended December 31, 2024, was 798 BOE per day, a decrease of 22% from 1,022 BOE per day in 2023[333]. - Total revenues for the year ended December 31, 2024, were $19,418,919, a decrease of 15% from $24,238,482 in 2023[345]. - Oil production decreased by 28% from 349 MBbl in 2023 to 256 MBbl in 2024, while natural gas production decreased from 355 MMcf to 213 MMcf[347]. Pricing and Costs - The average realized oil price per barrel for the year ended December 31, 2024, was $73.61, compared to $69.06 in 2023, reflecting a 6% increase[340]. - The average NYMEX oil price for the year ended December 31, 2024, was $76.55 per barrel, a 1% decrease from $77.64 in 2023[339]. - Lease operating expenses for the year ended December 31, 2024, were $8,614,080, down from $10,146,119 in 2023, but per BOE increased by 19% to $29.59[351]. - Production taxes, transportation, and processing costs were $1,715,792 for the year ended December 31, 2024, representing 8.7% of oil and natural gas sales[352]. Financial Performance - The company recorded a loss on derivative contracts of $850,374 for the year ended December 31, 2024, compared to a gain of $392,765 in 2023[349]. - Depletion, depreciation and amortization (DD&A) increased to $2,407,098 for the year ended December 31, 2024, from $1,849,876 in 2023, with a DD&A rate of $8.27 per BOE, up 48% from $4.53 per BOE in 2023[353]. - Accretion expense decreased to $144,988 in 2024 from $859,102 in 2023, with a per BOE rate of $0.50 compared to $2.32 in 2023, driven by changes in inflation and discount rate assumptions[354]. - General and administrative expenses rose to $10,381,095 in 2024 from $7,253,384 in 2023, including stock-based compensation of $2,778,991[355]. - Interest expense increased significantly to $7,643,200 in 2024 from $1,043,312 in the Successor period of 2023, primarily due to the Senior Secured Term Loan[357]. - The company reported a positive cash flow from operations of $3,700,686 for the year ended December 31, 2024, compared to $484,474 in the Successor period of 2023[368]. Debt and Liabilities - As of December 31, 2024, the company had outstanding debt of $23,641,517 under the Senior Secured Term Loan and a working capital deficit of $31,213,674[365]. - The company recognized a gain on extinguishment of liabilities of $1,638,138 in 2024, including a gain of $1,720,000 related to the settlement of royalties payable[360][361]. - The change in fair value of warrant liabilities resulted in a loss of $804,004 in 2024, compared to a gain of $187,704 in the Successor period of 2023[362]. Investments and Equity - Net cash used in investing activities for 2024 was primarily due to the development of crude oil and gas properties, with significant cash paid for oil and gas property costs in the Predecessor period[370]. - The company has a three-year equity line with a maximum funding limit of $150,000,000, having received $6,992,906 in cash proceeds from the sale of 7,000,000 shares of common stock under this agreement[367]. Risk Management - Derivative financial instruments are used to mitigate commodity price risk, recorded at fair value, with changes recognized in consolidated statements of operations[386]. - Realized and unrealized gains and losses from derivative instruments are reported as a component of revenues in the consolidated statements of operations[386]. - Cash flows from derivative contract settlements are reflected in operating activities in the consolidated statements of cash flows[386]. - The Company records liabilities for ongoing litigation and environmental remediation, with actual costs potentially varying from estimates due to legal interpretations and regulatory changes[384]. - The fair value of the Forward Purchase Agreement liability was estimated using a Monte-Carlo Simulation, considering future stock price simulations and contractual terms[385]. - The Company is classified as a smaller reporting company and is not required to provide additional market risk disclosures[388].

Financial Performance - In 2024, Onfolio Holdings Inc. achieved a revenue increase of 50% year-over-year, reaching $7.8 million, primarily due to the acquisition of three new businesses[274]. - The gross profit margin slightly declined to 58% in 2024 from 62% in 2023, attributed to new acquisitions with lower margins[275]. - Operating loss significantly improved from $9.2 million to $2.5 million, driven by profitable acquisitions and disciplined expense management[275]. - In Q4 2024, Onfolio recorded a positive net income of $136,000, marking a crucial step towards sustained profitability[276]. - The Company reported a net loss of $1,773,942 for the year ended December 31, 2024, a significant improvement compared to a net loss of $9,150,066 in 2023[303]. - Total revenue increased by $2,622,091, or 50%, to $7,862,077 for the year ended December 31, 2024, driven by acquisitions including RevenueZen, DDS Rank, and Eastern Standard[303]. - Cost of revenue increased by $1,320,045, or 66%, to $3,317,200, with gross profit margins decreasing to 57% from 62%[304]. - B2B revenue surged by $2,996,664, or 218%, primarily due to the RevenueZen acquisition, while B2C revenue decreased by $374,573, or 10%[315][319]. - Total other income rose to $733,906 in 2024 from $92,778 in 2023, driven by changes in fair value related to the RevenueZen acquisition[310]. - Net cash used in operating activities decreased to $1,168,363 in 2024 from $2,751,838 in 2023, attributed to increased revenues and reduced general and administrative costs[323]. Acquisitions and Investments - The company acquired three new businesses in 2024, contributing a total of $6 million in revenue, with Eastern Standard being the largest acquisition at $4 million in revenue[279][281]. - The acquisition of Eastern Standard was completed for $2.16 million, with Onfolio holding a 70% ownership stake[294]. - The company holds a 35.8% interest in Onfolio JV IV, LLC, which focuses on acquiring and operating online businesses for advertising revenue[330]. - The company has entered into two asset purchase agreements with contingent earn-out payments: up to $60,000 for BWPS Business Acquisition and $680,662 for RevenueZen Acquisition, both contingent on performance criteria[340]. - The company has not made any earn-out payments as of December 31, 2024, for the contingent payments related to the acquisitions[340]. Capital and Financing - Series A preferred shares were quoted on the OTCQB on October 30, 2024, allowing the company to raise additional capital and reduce reliance on the OA SPV Capital Model[289]. - The Company raised $600,000 through a private offering of Series A preferred stock by December 31, 2023, and an additional $693,000 thereafter[321]. - The OA SPV Capital Model was launched in March 2024, enabling accredited retail investors to co-invest in acquisitions, facilitating the DDSRank and Eastern Standard acquisitions[285]. Operational Efficiency - General and Administrative expenses decreased by $263,355, or 4%, mainly due to reduced advertising and marketing costs[306]. - The Company incurred an impairment loss of $121,000 in 2024, a significant reduction from total impairment losses of $5,016,764 in 2023[309]. - Cash provided by investing activities was $451,000 in 2024, compared to cash used of $850,000 in 2023, primarily from the sale of WP Folio subsidiary assets[325]. Revenue Recognition and Accounting Policies - Revenue is primarily generated from website management, digital services, advertising, content placement, and product sales, with revenue recognized as services are provided or products are shipped[334]. - The company receives management fees of 10% and 20% from OA SPV and OA SPV 2, respectively, based on cash distributions, which are accounted for as revenue contracts[332]. - The company recognizes revenue from online course subscriptions on a deferred basis until performance obligations are satisfied[334]. - The company accounts for its investments in joint ventures under either the cost or equity method, depending on ownership interest, and does not classify them as variable interest entities[331]. - The company reviews long-lived assets for impairment at least annually, comparing carrying amounts to expected undiscounted cash flows[338]. - The company amortizes acquired definite-lived intangible assets over their estimated useful lives, while indefinite-lived assets are subject to annual impairment tests[335]. - No off-balance sheet arrangements are reported that could materially affect the company's financial condition[339]. Future Outlook - The company expects to achieve positive free cash flow in the near term and plans to continue pursuing fundraising and acquisition activities to accelerate growth[290]. - Onfolio aims to focus on finding profitable businesses, acquiring them, and improving operations to drive long-term value creation in 2025[291].

Revenue Performance - Worldwide revenue for Q1 2025 increased by $59.9 million, or 1.6%, to $3,690.4 million compared to $3,630.5 million in Q1 2024[67] - Organic revenue growth contributed $121.9 million, or 3.4%, primarily driven by Media & Advertising and Precision Marketing disciplines[67] - Revenue from Media & Advertising increased by $94.0 million, while Branding & Retail Commerce decreased by $26.0 million in Q1 2025 compared to Q1 2024[68] - North America revenue increased by $70.6 million, or 3.5%, while Middle East and Africa revenue decreased by $8.8 million, or 11.1%[69] - Revenue for the three months ended March 31, 2025, was $3,690.4 million, an increase of $59.9 million or 1.6% compared to $3,630.5 million in the same period of 2024[73] - Organic growth contributed $121.9 million or 3.4% to revenue, primarily driven by increased client spending in Media & Advertising and Precision Marketing[82] - Revenue from Media & Advertising increased by $94.0 million, representing a 7.2% growth, while Public Relations and Healthcare disciplines saw declines of $20.8 million and $11.3 million, respectively[82] - In Asia-Pacific, organic revenue increased by 6.0%, driven by Media & Advertising, with positive growth in India and Australia[91] - In the U.K., organic revenue decreased by 0.7% for the three months ended March 31, 2025[89] Income and Expenses - Operating income decreased by $26.3 million, or 5.5%, to $452.6 million, with an operating margin of 12.3% compared to 13.2% in the prior year[70] - Net income for Omnicom Group Inc. was $287.7 million, down $30.9 million, or 9.7%, from $318.6 million in Q1 2024[70] - Operating income decreased to $452.6 million, down $26.3 million from $478.9 million in the prior year, resulting in an operating margin of 12.3% compared to 13.2%[73] - Net income for Omnicom Group Inc. was $287.7 million, a decrease of $30.9 million from $318.6 million in the same period last year, with diluted net income per share dropping to $1.45 from $1.59[73] - Operating expenses increased by $86.2 million, or 2.7%, to $3,237.8 million, with salary and service costs rising by $53.7 million[94] - Acquisition-related costs of $33.8 million were recorded in Q1 2025 as part of the merger expenses[57] - Acquisition-related costs of $33.8 million impacted both operating income and EBITA[98] - The effective tax rate increased to 28.5% from 25.7%, primarily due to non-deductible acquisition costs[101] Client Concentration - The largest client accounted for 2.7% of total revenue, while the top 100 clients represented approximately 53.6% of revenue for the twelve months ended March 31, 2025[65] - The ten largest clients represented 19.1% of revenue for the twelve months ended March 31, 2025, down from 20.0% in the prior year[83] - The largest client represented only 2.7% of revenue for the twelve months ended March 31, 2025, indicating a diversified client base[123] Cash Flow and Debt - Cash and cash equivalents decreased by $961.1 million from December 31, 2024, with $786.8 million used in operating activities[108] - The company's net debt increased by $1.0 billion to $2.8 billion from December 31, 2024, primarily due to cash usage of $786.8 million for operating activities[112] - The components of net debt as of March 31, 2025, included total debt of $6.1356 billion and cash and cash equivalents of $3.3783 billion[113] - The company maintained a Leverage Ratio of 2.4 times as of March 31, 2025, complying with the financial covenant requiring a maximum of 3.5 times[118] - The company's long-term and short-term debt ratings were BBB+ and A2 by S&P, and Baa1 and P2 by Moody's as of March 31, 2025[119] - The company has a $2.5 billion unsecured multi-currency revolving credit facility, expiring on June 2, 2028[106] - The company has the ability to issue up to $2 billion of U.S. Dollar-denominated commercial paper and $500 million in British Pounds or Euro under a Euro commercial paper program[110] Foreign Exchange Impact - Foreign exchange rate impacts reduced revenue by $59.2 million or 1.6%, mainly due to the weakening of currencies like the Euro and Brazilian Real against the U.S. Dollar[82] - The company expects a negative impact of 0.5% from foreign exchange rates in Q2 and a negative 1.0% for the full year, assuming current rates remain unchanged[77] - The company uses forward foreign exchange contracts to manage cash flow volatility arising from foreign exchange rate fluctuations[129] Strategic Focus - The company is focusing on leveraging generative AI to enhance service delivery and productivity while addressing associated risks and ethical considerations[63] - Discretionary spending for the first three months of 2025 was $253.7 million, significantly lower than $1.2 billion in the same period of 2024[108] - During the three months ended March 31, 2025, there were no drawings under the Credit Facility, and no commercial paper issuances were made[121] - The company has a policy governing counterparty credit risk with financial institutions that hold its cash and cash equivalents, ensuring minimum credit standards are met[110]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: December 31, 2024 OR ☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT For the transition period from _____________ to ____________ Commission file number 001-41977 NATURE'S MIRACLE HOLDING INC. (Exact name of small business issuer as specified in its charter) (State or other jurisdiction of incorporation ...

Financial Performance - The company reported a net loss of approximately $100.7 million for the year ended December 31, 2024, compared to a net loss of approximately $55.6 million for the previous year [119]. - As of December 31, 2024, the company's accumulated deficit was approximately $479.4 million, up from approximately $378.7 million as of December 31, 2023 [119]. - The company experienced a net loss from continuing operations of approximately $7.7 million for the year ended December 31, 2024 [120]. - The company has a history of losses and may continue to incur losses if it does not achieve sufficient revenue or reduce costs [119]. - The company’s financial condition may limit its ability to secure additional financing on acceptable terms, impacting its operations and growth [118]. - As of December 31, 2024, the company had federal net operating loss carryforwards (NOLs) of approximately $210.6 million, which may expire before generating sufficient taxable income [130]. - As of December 31, 2024, the company reported a stockholders' deficit of approximately $130.3 million, having incurred losses in the most recent six fiscal years [144]. Operational Risks - The digital media industry is highly competitive, with many players having greater financial resources, which may adversely affect the company's revenues and operating results [76]. - The company relies on third-party content contributors for user attraction, and the loss of key contributors could materially impact its business and financial condition [79]. - The sales cycle for online advertising is lengthy, and delays in payments from advertisers could adversely affect the company's financial condition and results of operations [78]. - The company faces risks from generative AI technology that may harm its ability to attract and retain audiences, protect intellectual property, and maintain revenue streams [74]. - Changes in internet search engine algorithms could reduce traffic to the company's content, negatively impacting audience retention and advertising revenues [77]. - The company is dependent on third-party cloud platforms for its digital media services, and any failures in these systems could harm its business and reputation [94]. - The growing percentage of users without support for third-party cookies could hinder the company's ability to collect data, impacting its advertising revenue [81]. - Cybersecurity threats, including ransomware and denial-of-service attacks, pose significant risks to the company's operations and financial results [89]. - The company may face claims of intellectual property infringement, which could result in substantial costs and adversely affect its business [99]. - The company faces risks related to changes in demand and pricing for its products and services, as well as competition from companies with larger user bases and resources [127]. - The company is dependent on the performance of its key executive officers and management team, with potential adverse effects on business if key personnel are lost [131]. - The company may incur substantial costs related to claims against it, which could adversely affect its financial results and operations [129]. Compliance and Regulatory Issues - The company is subject to evolving laws and regulations that could increase compliance costs and impact its business operations [102]. - The company faces risks from changes in regulations, government funding, and trade policies that could adversely affect its advertising clients and revenue [103]. - The company identified material weaknesses in its internal control over financial reporting, which could affect the accuracy of its financial statements [111]. - The company is currently out of compliance with the NYSE American's continued listing standards, specifically regarding minimum stockholders' equity requirements [144]. - The NYSE American accepted the company's compliance plan on December 20, 2024, granting a plan period through April 2, 2026, during which the company will be subject to quarterly monitoring [145]. - If compliance is not regained by the end of the plan period, the NYSE American may initiate delisting proceedings [145]. - The company intends to regain compliance within the plan period, although there is no assurance of success [146]. - Delisting could result in significant adverse consequences, including reduced liquidity and decreased analyst coverage [148]. Market and Stock Performance - The trading price of the company's common stock has been volatile, influenced by various external factors beyond its operational performance [138]. - The company has the authority to issue additional shares of common stock, which could dilute existing stockholders' ownership and negatively impact stock price [142]. - The company may issue additional securities with rights superior to those of its common stock, potentially limiting stockholders' ownership rights [143]. - The company is classified as a "smaller reporting company," which allows it to rely on reduced disclosure requirements, potentially affecting investor attractiveness [133]. - The company is classified as a smaller reporting company and is not required to provide certain market risk disclosures [237].

Drug Development and Clinical Trials - The company has a portfolio of seven drug candidates, including ENV 105 and ENV 205, targeting drug resistance and immune suppression in cancer treatment[20]. - ENV 105 is currently in a Phase 2 trial for prostate cancer, showing a clinical benefit rate of 62% among heavily pre-treated patients[27]. - The company initiated three clinical trials in fall 2023 for KROS 201 and ENV 105, with ENV 105 targeting both cancer cells and their supportive environment[26]. - The company has filed an Investigational New Drug (IND) application for ENV 105, which became effective, allowing the commencement of clinical trials[24]. - A three-gene panel is being developed as a companion biomarker for patient selection in the ENV 105 trial, although it has not yet been approved by the FDA[29]. - The NIH awarded a grant of USD 3.2 million to support the development of biomarkers related to ENV 105, which will aid in identifying potential responders in future trials[30]. - KROS 101 is an orally available GITR ligand small-molecule antagonist currently in pre-IND studies, aimed at enhancing the antitumor immune response for cancer treatment[40]. - KROS 201 is an activated T cell therapy targeting glioblastoma, with IND-enabling pharmacology and toxicology studies completed and an IND application submitted[47]. - ENV 105 is in a Phase 2 clinical trial for prostate cancer patients resistant to androgen-targeted therapy, with a potential market of USD 9 billion for a six-month dose in the U.S.[57]. - ENV 205 has shown potential to sensitize chemotherapy-resistant prostate cancer to docetaxel, with the global docetaxel market projected to grow from USD 137 billion in 2024 to USD 329 billion by 2033[54]. - The company aims to complete enrollment in multiple clinical trials, including a Phase 2 trial of ENV 105 for prostate cancer and a Phase 1 trial for KROS 201 in glioblastoma patients[68]. Market Potential and Financial Projections - The global prostate cancer therapeutics market is valued at USD 7.9 billion, while the EGFR mutant non-small cell lung cancer market is valued at USD 1.7 billion[27]. - The global cancer drug spending is expected to reach USD 532 billion by 2031, driven by targeted therapies and immuno-oncology[55]. - The immune checkpoint inhibitor market size was USD 47.4 billion in 2023 and is anticipated to grow to USD 189.1 billion by 2032, with a CAGR of 16.7%[60]. - The T cell therapy market size is projected to reach USD 20.8 billion by 2030, up from USD 4.9 billion in 2021, reflecting a CAGR of 20.4%[61]. - The specific cancer cachexia therapeutics market was over $2 billion in 2022, projected to exceed $4 billion by 2032[64]. - The maximum aggregate milestone payment for ENV 105 will be $7,150,000 when cumulative net sales exceed $100,000,000[85]. Strategic Partnerships and Acquisitions - The acquisition of Enviro Therapeutics, Inc. in June 2021 expanded the company's pipeline with advanced drug candidates in Phase 1 and Phase 2 trials[23]. - Kairos has entered into four Exclusive License Agreements with Cedars-Sinai Medical Center, requiring various fees and milestone payments totaling up to $4,400,000[76][77]. - Enviro is obligated to pay an upfront license fee and additional fees upon raising capital, with potential aggregate fees of approximately $690,000 as of December 31, 2024[83]. - The strategic partnership with Tracon is expected to enhance Enviro's market position and product offerings in the biotechnology sector[88]. Intellectual Property and Patent Strategy - The patent portfolio includes eight issued U.S. patents and 24 patent applications in foreign jurisdictions, enhancing Enviro's intellectual property position[89]. - The company is focused on expanding its patent protection across multiple jurisdictions, including Australia, Canada, China, and Europe[91]. - The company has a strong patent protection strategy, with several patents set to expire in the late 2030s, ensuring long-term market exclusivity[92]. - The company is actively pursuing new treatments for fibrosis and cancer, with multiple patents granted and applications pending in various jurisdictions including Japan and the United States[93]. - The company is focusing on both product and method patents, which enhances its competitive advantage in the market[95]. Financial Performance and Risks - The company has incurred significant losses since inception and expects to continue incurring losses over the next several years[116]. - The company has no products approved for commercial sale and may never achieve profitability[116]. - The company relies on additional financing to achieve business objectives, and adequate financing may not be available on acceptable terms[118]. - The company has limited operating history, making it difficult to evaluate its prospects for achieving intended business objectives[122]. - The company may face unforeseen expenses and complications as it transitions from a research-focused entity to one capable of supporting commercial activities[123]. Regulatory Challenges - The time required to obtain regulatory approval is unpredictable and typically takes many years, influenced by various factors including regulatory authority discretion[129]. - The company may need to relinquish valuable rights to technologies or future revenue streams if it raises additional funds through collaborations or strategic alliances[121]. - The company has not submitted a marketing application for any product candidates, and obtaining marketing authorization is a lengthy and uncertain process[132]. - The company may experience delays in preclinical testing and clinical trials, which could adversely affect its ability to obtain regulatory approvals[136]. - The regulatory approval process is lengthy and unpredictable, with no guarantee of obtaining approval for drug therapy candidates[165]. Sales and Marketing Challenges - The company lacks a sales and marketing infrastructure and has limited experience in the sale, marketing, or distribution of pharmaceutical products, which may hinder commercialization efforts[198]. - Establishing a sales force and marketing capabilities in the U.S. is critical, as delays could lead to significant commercialization costs without corresponding revenue[199]. - The company may face lower revenues and profitability if it relies on third parties for sales and marketing, limiting control over these operations[200]. - Coverage and adequate reimbursement for in-development products are uncertain, impacting market acceptance and sales potential[202]. Clinical Trial Integrity and Patient Recruitment - Enrollment and retention of patients in clinical trials is challenging and could delay trial completion[173]. - Serious adverse events or side effects from drug candidates could lead to interruptions in clinical trials and affect regulatory approval[175]. - The potential for adverse side effects could affect patient recruitment and the overall success of clinical trials[177].

Financial Performance - Revenue for the years ended December 31, 2024 and 2023 was $25.1 million and $19.5 million, respectively, representing a year-over-year increase of approximately 28.7%[307] - The company reported a net loss of $10.8 million for 2024 compared to a net loss of $1.2 million for 2023, indicating a significant increase in losses[307] - Adjusted EBITDA decreased by $5.4 million for the year ended December 31, 2024, compared to the previous year, primarily due to increased public company costs and expenses related to financial statement restatements[334] - The Company reported a net loss of $(10,771,451) for the year ended December 31, 2024, compared to a net loss of $(1,178,906) for the year ended December 31, 2023[333] - Net revenue for the year ended December 31, 2024, was $25,165,733, representing a 29.1% increase from $19,492,606 in 2023[352] - Gross profit increased to $5,887,947 in 2024, a 30.2% increase from $4,522,923 in 2023, with gross margin percentage rising to 23.4%[356] - Total operating expenses rose to $10,436,687 in 2024, a 72.3% increase from $6,058,757 in 2023, driven by higher advertising and general administrative expenses[359] - Interest expense surged to $5,270,404 in 2024, a 706.6% increase from $653,429 in 2023, primarily due to accrued interest on convertible notes[363] Business Operations - The company completed a business combination on December 12, 2023, resulting in the issuance of 26,500,000 shares of common stock and 25,000 shares of preferred stock as part of the merger consideration[314] - The company operates a logistics center in the UK to source and transport over-25-year-old work vehicles for restoration[310] - The Company has 105 employees, including 67 craftsmen and technicians, as of December 31, 2024[310] - The company experienced significant supply chain disruptions due to the COVID-19 pandemic, impacting operations and leading to the production of six fewer vehicles in 2020 compared to budget[324] - Vehicle builds accounted for 98.4% of total revenue in 2024, with an increase in average selling price per vehicle by $33,808 contributing $338,080 to revenue growth[354] Financing Activities - The December 2023 Convertible Note was issued for a principal amount of $15,819,209, with an interest rate of Prime + 5% per annum, and a maturity date of December 12, 2026[313] - The Company executed a senior secured convertible note in August 2024 for a principal amount of $1,154,681, net of a debt discount of $363,718, and issued 300,000 shares of Common Stock[373] - In January 2025, the Company entered into a securities purchase agreement for a loan of $1,724,100 and issued 500,000 shares of Common Stock[374] - The Company entered into a Business Loan and Security Agreement on February 20, 2025, receiving a term loan of $1,575,000, with total interest accruing to $661,500[416] - A new business loan agreement was established on April 4, 2025, with a principal amount of $1,824,300, accruing interest of $638,505[418] - The net proceeds from the new loan were used to pay off the previous Agile Loan amounting to $1,749,300[419] Customer and Revenue Management - Customer deposits amounted to $8,130,324 as of December 31, 2024, indicating reliance on customer funding for working capital[368] - Deferred revenue for completed vehicles not yet titled was $3,672,501 as of December 31, 2024[368] - The Company generates revenue through product sales, service revenue, and warranty revenue, with product revenue recognized upon customer payment and delivery[337] Strategic Initiatives - The Company plans to open new marketing channels in 2025, including outreach events and collaborations with market influencers[329] - The Company introduced the Jaguar E-type in 2022 and added the Ford Mustang and Toyota FJ to its lineup in 2024, targeting higher price points and gross margins[328] - The Company has expanded its manufacturing facility in Kissimmee, Florida, leasing 100,000 sq. ft. for 125 months to enhance production efficiencies[327] Compliance and Governance - The Company is currently working to regain compliance with Nasdaq Listing Rules after receiving notices regarding market value and filing delinquency[420][425] - ECD appointed Benjamin Piggott as Chief Financial Officer on September 16, 2024, following the resignation of Raymond Cole[455] - ECD appointed Barton CPA PLLC as the independent registered public accounting firm for the year ending December 31, 2024[464] - Keven Kastner was appointed as Chief Revenue Officer on November 11, 2024, to drive sales and manage revenue streams[457] Future Outlook - The Company has determined that its liquidity condition raises substantial doubt about its ability to continue as a going concern for the next twelve months[377] - The Company plans to use its current cash position and collections from accounts receivable to fund ongoing operations[378]