0001410578-23-001263 | 20-F | XBRL Viewer

SUBSEQUENT EVENTS	12 Months Ended
Dec. 31, 2022
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	22.SUBSEQUENT EVENTS The Group has performed an evaluation of subsequent events up to the date of the consolidated financial statements were issued, and determined that no events that would have required adjustment or disclosure in the consolidated financial statements other than those discussed in above.

SUBSEQUENT EVENTS

12 Months Ended

Dec. 31, 2022

22.SUBSEQUENT EVENTS

The Group has performed an evaluation of subsequent events up to the date of the consolidated financial statements were issued, and determined that no events that would have required adjustment or disclosure in the consolidated financial statements other than those discussed in above.

INTANGIBLE ASSETS, NET (Details) - USD ($) $ in Thousands	12 Months Ended
INTANGIBLE ASSETS, NET (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Finite-Lived Intangible Assets, Net
Intangible assets gross	$ 15,172	$ 15,428
Less: Accumulated amortization	(2,269)	(788)
Intangible assets, net	12,903	14,640
Amortization expense	1,531	785	$ 2
Trademark
Finite-Lived Intangible Assets, Net
Intangible assets gross	$ 15,100	14,983
Remaining useful life	8 years 6 months
Software
Finite-Lived Intangible Assets, Net
Intangible assets gross	$ 72	$ 445

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($)	Ordinary shares	Preferred shares	Additional paid-in capital	Accumulated earnings (deficit)	Statutory reserves	Accumulated Other Comprehensive income (loss)	Total shareholders' equity	Non-controlling interest	Total
Balance at beginning at Dec. 31, 2019	$ 4,000	$ 0	$ 5,499,000	$ (1,557,000)	$ 8,000	$ 61,000	$ 4,015,000	$ 0	$ 4,015,000
Balance at beginning (in shares) at Dec. 31, 2019	74,035,502	0
STATEMENTS OF CHANGES IN EQUITY
Shareholder investment			8,096,000				8,096,000		8,096,000
Capital divestments			(5,963,000)				(5,963,000)		(5,963,000)
Net loss				(166,000)			(166,000)		(166,000)
Foreign currency translation adjustment						181,000	181,000		181,000
Foreign currency translation adjustment, net of nil income taxes						181,000	181,000		181,000
Balance at ending at Dec. 31, 2020	$ 4,000		7,632,000	(1,723,000)	8,000	242,000	6,163,000		6,163,000
Balance at ending (in shares) at Dec. 31, 2020	74,035,502
STATEMENTS OF CHANGES IN EQUITY
Net loss				(196,579,000)			(196,579,000)	651,000	(195,928,000)
Foreign currency translation adjustment						395,000	395,000	117,000	512,000
Reverse acquisition	$ 3,000	$ 1,000	167,756,000				167,760,000	7,649,000	175,409,000
Reverse acquisition (in shares)	69,424,993	6,000
Vesting of restricted shares award	$ 1,000		40,335,000				40,336,000		40,336,000
Vesting of restricted shares award (in shares)	18,580,015
Share-based compensation-option			1,254,000				1,254,000		1,254,000
Series A preferred shares conversion	$ 0	$ 0	1,436,000	0	0	0	1,436,000	0	1,436,000
Series A preferred shares conversion (shares)	1,089,145
Contingent liabilities assumed by Renren Inc.			8,897,000				8,897,000		8,897,000
Foreign currency translation adjustment, net of nil income taxes						395,000	395,000	117,000	512,000
Balance at ending at Dec. 31, 2021	$ 8,000	$ 1,000	227,310,000	(198,302,000)	8,000	637,000	29,662,000	8,417,000	38,079,000
Balance at ending (in shares) at Dec. 31, 2021	163,129,655	6,000
STATEMENTS OF CHANGES IN EQUITY
Shareholder investment								665,000	665,000
Net loss				(84,706,000)			(84,706,000)	87,000	(84,619,000)
Issuance of ordinary shares and warrant for private placement	$ 1,000		4,243,000				4,244,000		4,244,000
Issuance of ordinary shares and warrant for private placement (in shares)	4,406,542
Dispose subsidiaries						(2,060,000)	(2,060,000)	(3,954,000)	(6,014,000)
Issuance of preferred shares		$ 2,000	24,591,000				24,593,000		24,593,000
Issuance of preferred shares (in shares)		50,000
Foreign currency translation adjustment						2,893,000	2,893,000	(1,027,000)	1,866,000
Vesting of restricted shares award	$ 1,000		39,309,000				39,310,000		39,310,000
Vesting of restricted shares award (in shares)	38,911,291
Issuance of ordinary shares held in escrow	$ 1,000		17,378,000				17,379,000		17,379,000
Issuance of ordinary shares held in escrow (in shares)	21,802,722
Foreign currency translation adjustment, net of nil income taxes						2,893,000	2,893,000	(1,027,000)	1,866,000
Balance at ending at Dec. 31, 2022	$ 11,000	$ 3,000	$ 312,831,000	$ (283,008,000)	$ 8,000	$ 1,470,000	$ 31,315,000	$ 4,188,000	$ 35,503,000
Balance at ending (in shares) at Dec. 31, 2022	228,250,210	56,000

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2022

INCOME TAXES

Schedule of current and deferred component of income tax expenses (benefit)


	For the years ended December 31,
	2020		2021		2022
Current income tax benefit (expense)	$	—	$	729	$	(74)
Deferred income tax expense		—		—		—
Total income tax benefit (expense)	$	—	$	729	$	(74)

Schedule of reconciliations of statutory income tax rate and the Group's effective income tax rate


	For the years ended December 31,
	2020			2021			2022
Net loss before provision for income taxes	$	166		$	196,657		$	84,545
PRC statutory tax rate		25	%		25	%		25	%
Income tax at statutory tax rate		42			49,164			21,136
Impairment of goodwill		—			(35,914)			—
Reversal of taxable deemed interest income from inter-company interest-free loans		—			1,354			—
Fair value change on warrants		—			500			(79)
Non-deductible loss and SBC expenses not deductible for tax purposes		—			(13,262)			(13,427)
Effect of income tax rate differences in jurisdictions other than the PRC		—			(437)			(1,721)
NOL not applicable for carryforward		(56)			(193)			(288)
Change in valuation allowance		14			(483)			(5,339)
Income tax benefit	$	—		$	729		$	(74)
Effective tax rates		—	%		0.38	%		(0.00)	%

Schedule of principal components of the deferred tax assets and liabilities


	As of December 31,
	2020		2021		2022
Deferred tax assets:
Write-down of Prepaid expenses and other current assets	$	—	$	4,249	$	477
Write-down of inventory		—		3,874		—
Provision for doubtful accounts		—		2,315		—
Write down of other non-current assets		—		1,054		—
Accrued expense		—		207		—
Accrued payroll and welfare		—		61		—
Advertising expense		—		6		—
Net operating loss carry forwards		388		13,474		584
Subtotal		388		25,240		1,061
Valuation allowance		(388)		(25,240)		(1,061)
Deferred tax assets, net	$	—	$	—	$	—

Summary of movements of the valuation allowance


	As of December 31,
	2020		2021		2022
Balance at the beginning of the year	$	402	$	388	$	25,240
Current year addition		63		1,454		5,267
Current year reversal		—		(753)		(7,039)
Reduction due to usage of NOL		(21)		(25)		(42)
Reduction due to statute expiration		(56)		(193)		(288)
Decrease in disposal of subsidiaries		—		—		(22,077)
Reverse acquisition		—		23,843		—
Exchange rate effect		—		526		—
Balance at the end of the year	$	388	$	25,240	$	1,061

INCOME TAXES

12 Months Ended

Dec. 31, 2022

INCOME TAXES

INCOME TAXES

15.INCOME TAXES

Cayman Islands

The Group is incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, the Group is not subject to income or capital gains taxes. In addition, dividend payments are not subject to withholdings tax in the Cayman Islands.

Hong Kong

On March 21, 2018, the Hong Kong Legislative Council passed The Inland Revenue (Amendment) (No. 7) Bill 2017 (the “Bill”) which introduces the two-tiered profits tax rates regime. The Bill was signed into law on March 28, 2018 and was announced on the following day. Under the two-tiered profits tax rates regime, the first 2 million Hong Kong Dollar (“HKD”) of profits of the qualifying group entity will be taxed at 8.25%, and profits above HKD 2 million will be taxed at 16.5%. The Group’s Hong Kong subsidiaries did not have assessable profits that were derived in Hong Kong for the years ended December 31, 2021 and 2022. Therefore, no Hong Kong profit tax has been provided for the years ended December 31, 2020, 2021 and 2022.

PRC

The Group’s PRC subsidiaries, VIEs and their subsidiaries are subject to the PRC Enterprise Income Tax Law (“EIT Law”) and are taxed at the statutory income tax rate of 25%, unless otherwise specified.

15.INCOME TAXES-CONTINUED

PRC-Continued

The components of the income tax expense are as follows:


	For the years ended December 31,
	2020		2021		2022
Current income tax benefit (expense)	$	—	$	729	$	(74)
Deferred income tax expense		—		—		—
Total income tax benefit (expense)	$	—	$	729	$	(74)

The reconciliations of the statutory income tax rate and the Group’s effective income tax rate are as follows:


	For the years ended December 31,
	2020			2021			2022
Net loss before provision for income taxes	$	166		$	196,657		$	84,545
PRC statutory tax rate		25	%		25	%		25	%
Income tax at statutory tax rate		42			49,164			21,136
Impairment of goodwill		—			(35,914)			—
Reversal of taxable deemed interest income from inter-company interest-free loans		—			1,354			—
Fair value change on warrants		—			500			(79)
Non-deductible loss and SBC expenses not deductible for tax purposes		—			(13,262)			(13,427)
Effect of income tax rate differences in jurisdictions other than the PRC		—			(437)			(1,721)
NOL not applicable for carryforward		(56)			(193)			(288)
Change in valuation allowance		14			(483)			(5,339)
Income tax benefit	$	—		$	729		$	(74)
Effective tax rates		—	%		0.38	%		(0.00)	%

The tax effect of temporary difference under ASC Topic 740 “Accounting for Income Taxes” that gives rise to deferred tax asset as of December 31, 2021 and 2022 is as follows:

15.INCOME TAXES-CONTINUED

PRC-Continued

The tax effect of temporary difference balance as of December 31, 2021 were mainly from KAH Group as a result of the reverse acquisition.


	As of December 31,
	2020		2021		2022
Deferred tax assets:
Write-down of Prepaid expenses and other current assets	$	—	$	4,249	$	477
Write-down of inventory		—		3,874		—
Provision for doubtful accounts		—		2,315		—
Write down of other non-current assets		—		1,054		—
Accrued expense		—		207		—
Accrued payroll and welfare		—		61		—
Advertising expense		—		6		—
Net operating loss carry forwards		388		13,474		584
Subtotal		388		25,240		1,061
Valuation allowance		(388)		(25,240)		(1,061)
Deferred tax assets, net	$	—	$	—	$	—

The Company had total deferred tax assets related to net operating loss carry forwards at $13,474 and $584 as of December 31, 2021 and 2022, respectively. The Company assessed the available evidence to estimate if sufficient future taxable income would be generated to use the existing deferred tax assets. As of December 31, 2021 and 2022, full valuation allowances were established because the Company believes that it is more likely than not that its deferred tax assets will not be utilized as it does not expect to generate sufficient taxable income in the near future. As of December 31, 2022, the Company had net operating losses from several of its PRC entities of $3,702, which can be carried forward to offset future taxable profit. The net operating loss of $72, $2,508, $933, $110 and $76 will expire by 2023, 2024, 2025, 2026 and 2027, respectively, if not utilized. As of December 31, 2022, the Company had net operating loss of $3 from Hong Kong subsidiaries which do not have an expiring date.

15.INCOME TAXES-CONTINUED

PRC-Continued

The movements of the valuation allowance are as follows:


	As of December 31,
	2020		2021		2022
Balance at the beginning of the year	$	402	$	388	$	25,240
Current year addition		63		1,454		5,267
Current year reversal		—		(753)		(7,039)
Reduction due to usage of NOL		(21)		(25)		(42)
Reduction due to statute expiration		(56)		(193)		(288)
Decrease in disposal of subsidiaries		—		—		(22,077)
Reverse acquisition		—		23,843		—
Exchange rate effect		—		526		—
Balance at the end of the year	$	388	$	25,240	$	1,061

Since January 1, 2008, the relevant tax authorities have not conducted a tax examination on the Company’s PRC entities. In accordance with relevant PRC tax administration laws, tax years from 2018 to present of the Company’s PRC subsidiaries and VIEs and VIEs’ subsidiaries remain subject to tax audits as of December 31, 2022 at the tax authority’s discretion.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI http://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

INCOME TAXES (Details) - USD ($)		12 Months Ended
INCOME TAXES (Details) - USD ($)	Mar. 21, 2018	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Income taxes
Profits tax rate		25.00%	25.00%	25.00%
Income tax expense		$ 74,000	$ (729,000)
Other Subsidiaries
Income taxes
Profits tax rate		25.00%
2022
Income taxes
Operating loss carryforwards		$ 72,000
2023
Income taxes
Operating loss carryforwards		2,508,000
2024
Income taxes
Operating loss carryforwards		933,000
2025
Income taxes
Operating loss carryforwards		110,000
2026
Income taxes
Operating loss carryforwards		76,000
Hong Kong
Income taxes
Income tax expense		0	$ 0	$ 0
Operating loss carryforwards		3,000
Hong Kong \| Corporate profits of first HKD 2 million
Income taxes
Corporate Profits	$ 2,000,000
Profits tax rate	8.25%
Hong Kong \| Corporate profits exceeds HKD 2 million
Income taxes
Corporate Profits	$ 2,000,000
Profits tax rate	16.50%
PRC
Income taxes
Operating loss carryforwards		$ 3,702,000

CONVERTIBLE NOTES

12 Months Ended

Dec. 31, 2022

CONVERTIBLE NOTES

CONVERTIBLE NOTES

16.CONVERTIBLE NOTES

The Group issued and sold two Convertible Promissory Notes (“Note A” and “Note B”, or collectively as “Notes”) to streererville CAPITAL, LLC (the “Lender”) on November 19, 2021 and April 8, 2022, respectively. The principal amount of two Notes is both $2,180 and substantial contract terms of two Notes are the same.

The purchase price of each Notes were $2,000, computed as follows: $2,180 principal, less discount at issuance of $160, less the transaction expense amount of $20 incurred in connection with the purchase and sale of the Securities. The Notes bears an interest at 8% per annum and is repayable in full in 18 months from issuance.

According to the Securities Purchase Agreements of the Notes, the Group has right to repay the Notes until it received the conversion notice from Lender or repayment date. The Lender also has right to conversion the Notes into ordinary shares at any time following the 6-month anniversary of the issuance date until the outstanding balance has been paid in full, at election, to convert all or any portion of no less than $200,000 of the outstanding balance into ordinary shares of the Company. The conversion price is $3.00 per ordinary share.

The Company has not elected the fair value option for the convertible note. And the Note does not have any embedded conversion option and redemption feature which shall be bifurcated and separately accounted for as a derivative under ASC 815, nor does it contain a cash conversion feature or beneficial conversion feature. The Company accounts for two Notes as liabilities in its entirety following ASC 470 Debt and recorded interest expenses of $22 and $683 for the year ended December 31, 2021 and 2022. The balances of Note A are $2,022 and $2,244 as of December 31, 2021 and 2022, respectively. The balances of Note B are nil and $2,061 as of December 31, 2021 and 2022, respectively.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2022

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

(a)Basis of presentation

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”).

Principles of consolidation

(b)Principles of consolidation

The consolidated financial statements include the financial statements of the Group, its subsidiaries, its VIEs, and subsidiaries of its VIE.s All inter-company transactions and balances have been eliminated upon consolidation.

Non-controlling interests

(c)Non-controlling interests

Non-controlling interests in the subsidiaries of VIEs of the Group represent the portion of the equity (net assets) in the subsidiaries of VIEs that has not been pledged to the subsidiary of the Group, consequently not directly or indirectly attributable to the Group. Non-controlling interests are presented as a separate component of equity on the consolidated balance sheet and net income (loss) and other comprehensive income (loss) are attributed to controlling and non-controlling interests respectively.

Business combinations

(d)Business combinations

The purchase price of business acquisition is allocated to the tangible assets, liabilities, identifiable intangible assets acquired and noncontrolling interest, if any, based on their estimated fair values as of the acquisition date. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition-related expenses and restructuring costs are expensed as incurred.

Where the consideration in an acquisition includes contingent consideration and the payment of which depends on the achievement of certain specified conditions post-acquisition, the contingent consideration is recognized and measured at its fair value at the acquisition date and if recorded as a liability, it is subsequently carried at fair value with changes in fair value reflected in earnings.

Use of estimates

(e)Use of estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and the reported amounts of revenues and expenses in the financial statements and accompanying notes. Significant accounting estimates reflected in the Group’s consolidated financial statements include, but are not limited to, warrant liabilities, the valuation of prepaid expenses and other current assets, deferred tax valuation allowance, impairment assessment on goodwill and intangible assets, the valuation of preferred shares, the purchase price allocation associated with business combinations.

Fair value measurement

(f)

Fair value measurement

Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be recorded at fair value, the Group considers the principal or most advantageous market in which it would transact and it considers assumptions that market participants would use when pricing the asset or liability.

Authoritative literature provides a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The level in the hierarchy within which the fair value measurement in its entirety falls is based upon the lowest level of input that is significant to the fair value measurement as follows:

●

Level 1 — inputs are based upon unadjusted quoted prices for identical assets or liabilities traded in active markets.

●

Level 2 — inputs are based upon quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

●

Level 3 — inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques.

Warrants

(g)

Warrants

The Group accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Group’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter with changes in fair value recognized in the statements of operations in the period of change.

Cash and cash equivalents

(h)

Cash and cash equivalents

Cash and cash equivalents consist of cash on hand and cash in banks. The Group considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents.

Prepayment for vehicle purchase and other assets

(i)

Prepayment for vehicle purchase and other assets

Prepayment for vehicle purchase, other current assets and other non-current assets consist of prepayment for vehicle purchase to the dealership operators, advances to suppliers, deductible input VAT, other receivables and others. The Group reviews suppliers credit history and background information before advancing a payment. The Group maintains an allowance for doubtful accounts based on a variety of factors, including but not limited to the aging of prepayments, concentrations, credit-worthiness, historical and current economic trends and changes in delivery patterns. If the financial condition of its suppliers were to deteriorate, resulting in an impairment of their ability to deliver goods or provide services, the Group would provide allowance for such amount in the period when it is considered impaired. There was no allowance recognized for the prepayment for vehicle purchase, other current assets and other non-current assets for the years ended December 31, 2020. The Company recorded impairment loss of nil and $22,921 for prepayment for vehicle purchase and other current assets for the years ended December 31, 2021 and 2022, and recorded impairment loss of $4,216 and nil for other non-current assets for the years ended December 31, 2021 and 2022.

Inventory

(j)

Inventory

Inventory includes only the purchased new automobiles. Inventory is stated at the lower of cost or net realizable value. Inventory cost is determined by specific identification. Net realizable value is the estimated selling price less costs to complete, dispose and transport the vehicles. Selling prices are derived from historical data and trends, such as sales price and inventories turnover times of similar vehicles, as well as independent, market resources. Each reporting period the Group recognizes any necessary adjustments to reduce the cost of vehicle inventories to its net realizable value through cost of sales in the accompanying consolidated statements of operations.

Vehicle inventories are considered slow moving if they have not been sold within a 90 days period since procurement. In estimating the level of inventories write-downs for slow moving vehicles, the Group considers historical data and forecasted customer demand, such as sales price and inventories turnover of similar vehicles with similar mileage and condition, as well as independent, market information. This valuation process requires management to make judgments, based on currently available information, and assumptions about future demand and market conditions, which are inherently uncertain. To the extent that there are significant changes to estimated vehicle selling prices or decreases in demand for used vehicles, there could be significant adjustments to reflect inventories at net realizable value. There were no write-downs of inventories recorded for the years ended December 31,2020, 2021 and 2022.

Convertible notes

(k)

Convertible notes

The Group accounts for its convertible notes under ASC 470 Debt, using the effective interest method, as a single debt instrument, from the issuance date to the maturity date. Interest expenses are recognized in the consolidated statement of operation in the period in which they are incurred. If the convertible notes are converted into equity, the company must extinguish the related debt liability. The Group should recognize any difference between the carrying amount of the liability and the fair value of the equity instruments issued as a gain or loss in the income statement.

Property and equipment, net

(l)

Property and equipment, net

Property and equipment are stated at cost less accumulated depreciation and impairment if any. The depreciation is recognized on a straight-line basis over the estimated useful lives of the assets. Cost represents the purchase price of the asset and other costs incurred to bring the asset into its intended use. The cost of repairs and maintenance is expensed as incurred; major replacements and improvements are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income/loss in the year of disposition. Estimated useful lives are as follows:

		Estimated Useful Life
Computer equipment and application software		2 - 3 Years
Furniture and vehicles		5 Years

Intangible assets, net

(m)

Intangible assets, net

Intangible asset is stated at cost less accumulated amortization and impairment if any. Intangible asset is amortized in a method which reflects the pattern in which the economic benefits of the intangible asset are expected to be consumed or otherwise used up. When assets are retired or disposed of, the cost and accumulated amortization are removed from the accounts, and any resulting gains or losses are included in income/loss in the year of disposition. Estimated useful lives are as follows:


		Estimated Useful Life
Software		10 Years
Domain name		10 Years
Trademark		10 Years

In accordance with ASC Topic 360, the Company reviews intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. Software and domain name are used for the business of Haitaoche and no impairment indicators was noted. The trademark recognized from the Reverse Acquisition were initial recognized using Relief-From-Royalty (“RFR”) method. The trademark was tested for impairment due to identification of impairment indicator.

The amount of impairment is measured as the difference between the asset’s estimated fair value and its carrying amount. The Company did not record any impairment charge for the years ended December 31, 2020, 2021and 2022.

Goodwill

(n)

Goodwill

Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations.

The Group assesses goodwill for impairment on annual basis as of December 31 or if indicator noted for goodwill impairment. In accordance with ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”) issued by the Financial Accounting Standards Board (“FASB”) guidance on testing of goodwill for impairment, the Group will first assess qualitative factors to determine whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative impairment test. If this is the case, the quantitative goodwill impairment test is required. If it is more likely-than-not that the fair value of a reporting unit is greater than its carrying amount, the quantitative goodwill impairment test is not required.

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

Quantitative goodwill impairment test is used to identify both the existence of impairment and the amount of impairment loss, compares the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit is greater than its carrying amount, goodwill is not considered impaired. If the fair value of the reporting unit is less than its carrying amount, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.

For the goodwill recognized subsequent to the reverse acquisition on June 25, 2021, the management performed qualitative assessment and noted certain facts and circumstances indicated that it was more likely than not that the fair value of the reporting unit was less than its carrying value, which required the Group to perform a quantitative test, with the income approach using discounted cash flow (“DCF”), to determine the fair value of the KAH Group reporting unit. Based on the results of the quantitative goodwill impairment test, the Group fully impaired the goodwill generated through the reversed acquisition of $143,655 in 2021.

Impairment of long-lived assets

(o)

Impairment of long-lived assets

In accordance with ASC Topic 360, the Group reviews long-lived assets or asset group for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be fully recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Group first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Any impairment write-downs would be treated as permanent reductions in the carrying amounts of the assets and a charge to operations would be recognized. Management has performed a review of all long-lived assets and has determined that no impairment loss for long-lived assets has occurred for the year ended December 31, 2020 and recorded impairment loss of $4,216 and nil for other long-lived assets for the years ended December 31, 2021 and 2022.

Operating lease right of -use assets

(p) Operating lease right-of -use assets

The Group leases premises for offices under non-cancellable operating leases.

Prior to the adoption of Accounting Standards Update (“ASU”) No. 2016-02, Leases (Topic 842) and subsequent amendments to the initial guidance including ASU No. 2017-13, ASU No. 2018-10, ASU No. 2018-11, ASU No. 2018-20, and ASU No. 2019-01 (collectively, “Topic 842”), operating leases were not recognized on the consolidated balance sheets, instead, rental expenses with fixed payments were recognized on a straight-line basis over the lease term.

Effective January 1, 2021, the Group adopted Topic 842 using a modified retrospective transition approach for leases that exist at, or are entered into after January 1, 2021, and has not recast the comparative periods presented in the consolidated financial statements. Upon adoption of Topic 842 and the reverse acquisition, the lease liabilities are recognized upon lease commencement for operating leases based on the present value of lease payments over the lease term. The right-of-use assets are initially measured at cost, which comprises the initial amount of the lease liability adjusted for lease payments made at or before the lease commencement date, plus any initial direct costs incurred less any lease incentives received. As the rate implicit in the lease cannot be readily determined, the Group’s incremental borrowing rate at the lease commencement date is used in determining the imputed interest and present value of lease payments. The incremental borrowing rate was determined using a portfolio approach based on the rate of interest that the Group would have to borrow an amount equal to the lease payments on a collateralized basis over a similar term. The Group recognizes the single lease cost on a straight-line basis over the remaining lease term for operating leases.

The Group has elected not to recognize right-of-use assets or lease liabilities for leases with an initial term of 12 months or less; expenses for these leases are recognized on a straight-line basis over the lease term.

Value added tax

(q)

Value added tax

Value-added tax (“VAT”) is reported as a deduction to revenue when incurred. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. Net VAT balance between input VAT and output VAT is recorded in accrued expense and other current liabilities on the consolidated balance sheets.

In 2018, the Group entered into a series of ancillary agreements to facilitate its sale of used cars for value-added tax optimization purposes, which was still applicable in 2022. Under these ancillary agreements, when the Group sources a used car, the legal ownership of the car is transferred toZhejiang Kaixin Auto Co., Ltd’s executives, and the registration is normally under the name of one of the dealership’s employees. The Group viewed itself as a service provider for VAT purpose, and therefore is only subject to value-added tax on the difference between the original purchase price and the retail price of the used cars. The Group’s other affiliated entities in the PRC, including Zhejiang Taohaoche are subject to VAT for sales of automobiles at applicable tax rates, and subsequently paid to PRC tax authorities after netting input VAT on purchases.

The Group reports revenue net of PRC’s VAT for all the periods presented in the consolidated statements of operations.

Revenue recognition

(r)

Revenue recognition

The Group accounts for revenue using Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers. The following five steps are applied to achieve core principle of ASC 606:

Step 1: Identify the contract with the customer

Step 2: Identify the performance obligations in the contract

Step 3: Determine the transaction price

Step 4: Allocate the transaction price to the performance obligations in the contract

Step 5: Recognize revenue when the Group satisfies a performance obligation

The Group primarily sells automobiles to car dealers and individual customers through signing written sales contracts. The Group presents the revenue generated from its sales of automobiles on a gross basis as the Group is a principal based on the fact that the Group is primarily responsible for fulling the promise to deliver the specified used cars or new cars to the customers, the Group also has pricing discretion and obtains substantially all of the remaining benefits from the sale goods. Revenue is recognized at a point in time upon delivery, which usually coincide with the timing of the customer acceptance.

The following table identifies the disaggregation of the revenue for the years ended December 31, 2020, 2021 and 2022, respectively:


	For the year ended December 31,
	2020		2021		2022
Used-car sales	$	—	$	251,054	$	80,034
New-car wholesales		1,207		2,786		2,806
Total revenues	$	1,207	$	253,840	$	82,840

Advances from customers

Advances from customers for sales of goods are payment from customers for purchase, and are deferred when corresponding performance obligation has not been satisfied. They are recognized as revenue upon the Group transfers the control of products to the customers.

Cost of revenue

(s)

Cost of revenue

Cost of revenue consists primarily of cost of goods purchased from domestic and overseas regions.

Income taxes

(t)

Income taxes

The Group accounts for income taxes using the asset/liability method prescribed by ASC 740 Income Taxes. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities using enacted tax rates that will be in effect in the period in which the differences are expected to reverse. The Group records a valuation allowance to offset deferred tax assets if, based on the weight of available evidence, it is more-likely-than-not that some portion, or all, of the deferred tax assets will not be realized. The effect on deferred taxes of a change in tax rates is recognized as income or loss in the period that includes the enactment date.

The provisions of ASC 740-10-25, “Accounting for Uncertainty in Income Taxes,” prescribe a more-likely-than-not threshold for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This interpretation also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures. The Group’s operating subsidiaries in PRC are subject to examination by the relevant tax authorities. According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of taxes is due to computational errors made by the taxpayer or the withholding agent. The statute of limitations is extended to five years under special circumstances, where the underpayment of taxes is more than RMB 100,000 ($15,500). In the case of transfer pricing issues, the statute of limitation is ten years. There is no statute of limitation in the case of tax evasion. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred.

As of December 31, 2021 and 2022, the Group did not have any significant unrecognized uncertain tax positions and the Group does not believe that its unrecognized tax benefits will change over the next twelve months. In addition, the Group did not have any interest or penalties associated with uncertain tax position for the years ended December 31, 2020, 2021 and 2022.

Foreign currency translation

(u)

Foreign currency translation

The reporting currency of the Group is the U.S. dollar (“USD” or “$”). The functional currency of subsidiaries, VIEs located in China is the Chinese Renminbi (“RMB”), the functional currency of subsidiaries located in Hong Kong is the Hong Kong dollars (“HK dollar” or “HK$”). For the entities whose functional currency is the RMB and HK$, result of operations and cash flows are translated at average exchange rates during the period, assets and liabilities are translated at the unified exchange rate at the end of the period, and equity is translated at historical exchange rates. As a result, amounts relating to assets and liabilities reported on the statements of cash flows may not necessarily agree with the changes in the corresponding balances on the balance sheets. Translation adjustments are reported as foreign currency translation adjustment and are shown as a separate component of other comprehensive income (loss) in the consolidated statements of comprehensive income (loss).

Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing at the balance sheet date. Both exchanges rates were published by the Federal Reserve Board. Any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are shown as foreign currency exchange (loss) gains in the consolidated statements of operations and comprehensive income (loss) as incurred.

The consolidated balance sheets amount, with the exception of equity, on December 31, 2021 and December 31, 2022 were translated at RMB6.3726 to $1.00 and at RMB6.8972 to $1.00, respectively. Equity accounts were stated at their historical rates. The average translation rates applied to consolidated statements of operations and cash flows for the years ended December 31, 2020, 2021 and 2022 were RMB6.7434 to $1.00, RMB6.3914 to $1.00 and RMB6.7290 to $1.00, respectively.

Share-based compensation

(v)

Share-based compensation

Share-based payment transactions with employees, such as share options are measured based on the grant date fair value of the equity instrument. The Company recognizes the compensation costs net of estimated forfeitures using the straight-line method, over the applicable vesting period. The estimate of forfeitures will be adjusted over the requisite service period to the extent that actual forfeitures differ, or are expected to differ, from such estimates. Changes in estimated forfeitures will be recognized through a cumulative catch-up adjustment in the period of change and will also impact the amount of stock compensation expense to be recognized in future periods. Share options granted to employees with market conditions attached are measured at fair value on the grant date and are recognized as the compensation costs over the estimated requisite service period, regardless of whether the market condition has been met.

A change in any of the terms or conditions of share options is accounted for as a modification of stock options. The Company calculates the incremental compensation cost of a modification as the excess of the fair value of the modified option over the fair value of the original option immediately before its terms are modified, measured based on the share price and other pertinent factors at the modification date. For vested options, the Company recognizes incremental compensation cost in the period the modification occurred. For unvested options, the Company recognizes, over the remaining requisite service period, the sum of the incremental compensation cost and the remaining unrecognized compensation cost for the original award on the modification date.

Loss per share

(w)

Loss per share

Basic loss per share is computed by dividing net loss attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding for the period. Diluted loss per share is calculated by dividing net loss attributable to ordinary shareholders as adjusted for the effect of dilutive ordinary equivalent shares, if any, by the weighted average number of ordinary and dilutive ordinary equivalent shares outstanding during the period. Potentially dilutive shares are excluded from the computation if their effect is anti-dilutive.

Comprehensive income (loss)

(x)

Comprehensive income (loss)

Comprehensive income (loss) is comprised of the Group’s net income (loss) and other comprehensive income (loss). The components of other comprehensive income (loss) consist solely of foreign currency translation adjustments.

Commitments and contingencies

(y)

Commitments and contingencies

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount can be reasonably estimated. If a potential material loss contingency is not probable but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss if determinable and material, is disclosed. Legal costs incurred in connection with loss contingencies are expensed as incurred.

Concentration of credit risk

(z)

Concentration of credit risk

Financial instruments that potentially expose the Group to concentrations of credit risk consist primarily of cash and cash equivalent, prepayment for vehicle purchase and other receivable due from noncontrolling shareholders. The Group places its cash and cash equivalent with financial institutions with high-credit ratings and quality.

Prepayment for vehicle purchase and other current assets are concentrated with noncontrolling shareholders (Note 6) as of December 31, 2022. With regard to the prepayment for used car purchase, the Group regularly monitor and performs inspection and counting on these noncontrolling shareholders’ cars inventory to ensure the prepayments are recoverable. Regarding the other receivable due from these noncontrolling shareholders, the Group has arrangement to hold the Company’s ordinary shares issued to these parties to ensure the repayment of majority of the balances.

There were no customers that accounted for 10% or more of total revenues for the years ended December 31, 2020, 2021 and 2022. No supplier that accounted for 10% or more of total purchase for the years ended December 31, 2020, 2021 and 2022 or 10% or more of prepaid expenses and other current assets balance as December 31, 2020, 2021 and 2022.

Segment reporting

(aa)

Segment reporting

The Group uses the management approach to determine operating segments. The management approach considers the internal organization and reporting used by the Group’s chief operating decision maker (“CODM”) for making decisions, allocating resources, and assessing performance. The Group’s CODM has been identified as the chief executive officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Group.

The Group’s CODM reviews the consolidated financial results when making decisions about allocating resources and assessing the performance of the Group as a whole and hence, the Group has only one reportable segment. The Group operates and manages its business as a single segment. As the Group’s long-lived assets are substantially all located in the PRC and substantially all of the Group’s revenue is derived from within the PRC, no geographical segments are presented.

Recently Adopted Accounting Standards

(bb)

Recently Adopted Accounting Standards

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses”, which will require the measurement of all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Subsequently, the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, to clarify that receivables arising from operating leases are within the scope of lease accounting standards. Further, the FASB issued ASU No. 2019-04, ASU 2019-05, ASU 2019-10, ASU 2019-11 and ASU 2020-02 to provide additional guidance on the credit losses standard, which defers the effective date of ASU No. 2016-13 for smaller reporting companies to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. Since as of December 31, 2022 the Company no longer qualifies as an EGC, it no longer qualifies for the deferral of the effective date available for EGCs. As such the Company adopted the standard by using the modified retrospective method, effective as of January 1, 2022, and reflected the impact in its financial statements for the year ended December 31, 2022. The impact of the adoption on the consolidated balance sheets, statements of operations, and statements of cash flows was immaterial.

In August 2020, the FASB amended guidance related to accounting for convertible instruments as part of ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20): Debts with Conversion and Other Options. The guidance amended the guidance on convertible debt instruments by removing accounting models for the instruments with beneficial conversion features and cash conversion features and amended the disclosure guidance on convertible debt instruments The ASU is effective for public Group for fiscal years, and interim periods within those fiscal years beginning after December 15, 2021. For all other entities including emerging growth companies, the ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2023. Since as of December 31, 2022 the Company no longer qualifies as an EGC, it no longer qualifies for the deferral of the effective date available for EGCs. As such the Company adopted the standard by using the modified retrospective method, effective as of January 1, 2022, and reflected the impact in its financial statements for the year ended December 31, 2022. The impact of the adoption on the consolidated balance sheets, statements of operations, and statements of cash flows was immaterial.

(dd)

Recent Accounting Standards

In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. This ASU requires acquiring entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. This guidance is effective for public entities for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The impact of adopting this guidance on the Company’s consolidated financial statements will depend on business combinations occurring on or after the effective date.

Recently issued ASUs by the FASB, except for the ones mentioned above, are not expected to have a significant impact on the Group’s consolidated results of operations or financial position. Other accounting standards that have been issued by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Group does not discuss recent standards that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures.

OTHER RECEIVABLES (Details) $ in Thousands	12 Months Ended
OTHER RECEIVABLES (Details) $ in Thousands	Dec. 31, 2022 USD ($)
OTHER RECEIVABLES.
Other receivables, total amount	$ 8,848
Repat receivables	1 year
Valuation allowance for receivables	$ 0

RELATED PARTY TRANSACTIONS AND BALANCES (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Related party transactions and balances
Amounts due to related parties	$ 1,627	$ 3,943
Intercompany balances	2,516
Renren And Its Subsidiaries
Related party transactions and balances
Amounts due to related parties	1,427	$ 3,943
Mr. Lin
Related party transactions and balances
Amounts due to related parties	$ 200

- Definition

Carrying amount as of the balance sheet date of obligations due all related parties.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(k)(1))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(C))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
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-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-03.17)
-URI http://asc.fasb.org/extlink&oid=120400017&loc=d3e572229-122910

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(B))
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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-Paragraph 1A
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-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442526-122756

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-URI http://asc.fasb.org/extlink&oid=124359900&loc=SL124442552-122756

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
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-Name Accounting Standards Codification
-Topic 942
-SubTopic 210
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-03.15(3),(4))
-URI http://asc.fasb.org/extlink&oid=120398452&loc=d3e534808-122878

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 850
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=6457730&loc=d3e39549-107864

+ Details

CONVERTIBLE NOTES (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	Nov. 19, 2021	Dec. 31, 2022	Dec. 31, 2021	Apr. 08, 2022
Convertible Notes
Proceeds from convertible loan		$ 2,000	$ 2,000
Convertible Promissory Notes A
Convertible Notes
Interest expenses		2,244	2,022
Convertible Promissory Notes B
Convertible Notes
Interest expenses		2,061	0
Convertible Debt
Convertible Notes
Aggregate principal amount	$ 2,180
Principal amount	160
Transaction expense amount	20
Proceeds from convertible loan	$ 2,000
Interest rate (as a percent)	8.00%
Loan period	18 months
Convertible threshold period	6 months
Principal amount converted	$ 200,000
Conversion price	$ 3.00
Interest expenses		$ 683	$ 22
Convertible Debt \| Convertible Promissory Notes A
Convertible Notes
Principal amount	$ 2,180
Convertible Debt \| Convertible Promissory Notes B
Convertible Notes
Principal amount				$ 2,180

DEALERSHIP SETTLEMENT - Additional information (Details) - USD ($) $ in Thousands				1 Months Ended	12 Months Ended
	Aug. 19, 2022	May 26, 2022	Nov. 30, 2021	May 31, 2022	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2018
Dealership Operators
Dealership Settlement
Shares issued to pre-reverse acquisition	7,172,529				1,969,425	7,172,529
Accrued payables						$ 2,245
Dealership settlement amount						11,142
R e n r e n Inc.
Dealership Settlement
Shares issued to pre-reverse acquisition			13,422,613		13,422,613
Equity purchase agreements
Dealership Settlement
Contingent consideration shares				33,748,772
Equity purchase agreements \| Dealership Operators
Dealership Settlement
Equity interest subscribed							70.00%
Shares issued to pre-reverse acquisition	4,513,761	20,326,159	8,219,510	21,566,328
Contingent consideration shares		20,326,159			5,203,103
Additional paid-in capital with a fair value		$ 17,379			$ 8,897
Provision for dealership settlement						$ 2,245

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY- STATEMENTS OF OPERATIONS (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
CONDENSED PARENT COMPANY STATEMENTS OF OPERATIONS
General and administrative expenses	$ 46,488	$ 43,734	$ 265
Other income	728	(4)	25
Income before income tax expense	(84,545)	(196,657)	(166)
Income tax expense	74	(729)
Net loss	(84,619)	(195,928)	(166)
Legal entities \| Parent
CONDENSED PARENT COMPANY STATEMENTS OF OPERATIONS
Share of loss of subsidiaries and VIEs	(78,256)	(196,579)	(166)
General and administrative expenses	(5,897)
Other income	(465)
Income before income tax expense	(84,619)	(196,579)	(166)
Net loss	$ (84,619)	$ (196,579)	$ (166)

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

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+ Details

DISPOSAL OF SUBSIDIARIES (Tables)

12 Months Ended

Dec. 31, 2022

DISPOSAL OF SUBSIDIARIES.

Schedule of gain regarding divestiture of disposal group


	As of October 27, 2022
Fair value of preferred shares issued to Stanley Star	$	(24,592)
The carrying amount of any noncontrolling interest		(3,954)
Net liabilities		(24,276)
Gain on disposal of subsidiaries	$	3,638

Summary of carrying amounts of the major classes of assets and liabilities of the disposal group


	As of October 27, 2022
Cash and cash equivalents	$	97
Prepaid expenses and other current assets		1,983
Property and equipment, net		4
Intangible assets, net		20
TOTAL ASSETS	$	2,104

Accounts payable		(257)
Advance from customers		(163)
Long-term bank loan		(5,476)
Income tax payable		(2,225)
Amount due to Kaixin		(8,848)
VAT payable		(3,340)
Accrual expenses and other current liabilities		(6,071)
Total Liabilities	$	(26,380)

Net liabilities	$	(24,276)

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

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+ Details

REVERSE ACQUISITION (Tables)

12 Months Ended

Dec. 31, 2022

REVERSE ACQUISITION.

Schedule of allocation of the purchase prices


	Amount
	$
Fair value of consideration transferred ⁽¹⁾		161,760

Fair value of the assets acquired and the liabilities assumed
Cash and cash equivalents		4,299
Prepaid expense		46,708
Property plant and equipment		31
Trademark (Intangible Assets)		15,100
Right-of-use assets		47
Goodwill		143,655
Subtotal of total assets		209,840
Short-term bank loan		(8,195)
Accounts payable		(406)
Advance from customers		(461)
Short-term lease liabilities		(32)
Other payables		(13,198)
Amounts due to RPT		(4,288)
Income tax payable		(4,079)
Warrants		(2,335)
Mezzanine equity-Preferred shares		(1,437)
Subtotal of total liabilities		(34,431)
Less: Non-controlling interest		(7,649)
Less: Preferred shares ⁽²⁾		(6,000)
Total net assets		161,760

(1)

The fair value of 69,424,993 ordinary shares issued to pre-reverse acquisition KAH shareholders is $161,760 based on the quoted fair market value of $2.33 per ordinary share on June 25, 2021.

(2)

It represented Series D convertible preferred shares of KAH issued to Renren Inc. on April 8, 2021 (see Note 15)

Schedule of pro forma information for the period


	For the years ended December 31,
	2020		2021
	Unaudited		Unaudited
Revenue	$	34,367	$	257,631
Net loss	$	(5,486)	$	(191,468)

FAIR VALUE MEASUREMENTS

12 Months Ended

Dec. 31, 2022

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

19. FAIR VALUE MEASUREMENTS

Assets and liabilities measured or disclosed at fair value

The Group measures its financial assets and liabilities, including warrant liability at fair value on a recurring basis as of December 31, 2021 and 2022. The Group measured its prepayment for vehicle purchase and other current assets, accounts payable, short-term debt, amounts due from and due to related parties at amortized cost. The carrying value of the short-term debt obligations approximate fair value, considering the borrowing rates are at the same level of the current market yield for the comparable debts. The carrying value of cash and cash equivalent, prepayment for vehicle purchase and other current assets, accounts payable, and amounts due from and due to related parties’ approximate fair value due to the relatively short maturity.

The following table presents the fair value hierarchy for assets and liabilities measured at fair value on a recurring basis:

As of December 31, 2021

As of December 31, 2022

Fair Value Measurement at the Reporting Date using

Quoted

price in

active

markets

for

Significant

for

Significant

identical

other

unobservable

identical

other

unobservable

assets

observable

inputs

assets

observable

inputs

Level 1

inputs

Level 3

Total

Level 1

inputs

Level 3

Total

Warrant liabilities

—

(340)

—

(24)

There have been no transfers between Level 1, Level 2, or Level 3 categories during the years ended December 31, 2021 and December 31, 2022.

Assets measured at fair value on a nonrecurring basis

The Group measures its property, equipment, and intangible assets at fair value on a nonrecurring basis whenever events or changes in circumstances indicate that the carrying value may no longer be recoverable. The Group measures the purchase price allocation at fair value on a nonrecurring basis as of the acquisition dates.

Goodwill is evaluated for impairment annually or more frequently if events or conditions indicate the carrying value of a reporting unit may be greater than its fair value. Impairment testing compares the carrying amount of the reporting unit with its fair value. In 2021, the Group performed impairment tests for goodwill caused by the reverse acquisition using the discounted cash flow method. The fair value of goodwill is a Level 3 valuation based on certain unobservable inputs including projected cash flows, terminal growth rate of 2.5%, forecasted inflation rate of 2.5%, discount rate of 12% that would be utilized by market participants in valuing these assets or prices of similar assets.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

SHARE-BASED COMPENSATION - Kaixin Auto 2019 Plan (Details)	May 03, 2019 employee $ / shares shares	Dec. 31, 2022 $ / shares	Dec. 31, 2021 $ / shares	Apr. 30, 2019 shares
SHARE-BASED COMPENSATION
Weighted average exercise price \| $ / shares		$ 0.02	$ 0.02
Kaixin 2019 Plan
SHARE-BASED COMPENSATION
Ordinary shares of KAH for future grant				4,715,700
Options granted	2,186,364
Number of employees for option \| employee	144
Kaixin 2019 Plan \| Vests immediately on grant date
SHARE-BASED COMPENSATION
Weighted average exercise price \| $ / shares	$ 1.70
Vesting percentage	25.00%
Kaixin 2019 Plan \| Vests monthly subsequent to replacement date
SHARE-BASED COMPENSATION
Weighted average exercise price \| $ / shares	$ 0.01
Vesting period	3 years
Vesting percentage	62.50%
Kaixin 2019 Plan \| Restricted shares
SHARE-BASED COMPENSATION
Granted	2,183,828
Kaixin 2019 Plan \| Replacement restricted shares \| Shares granted to certain employees
SHARE-BASED COMPENSATION
Granted	205,215
Kaixin 2019 Plan \| Replacement restricted shares were subject to graded vesting
SHARE-BASED COMPENSATION
Vesting percentage	0.25%
Kaixin 2019 Plan \| Replacement restricted shares were subject to graded vesting \| Vests monthly subsequent to replacement date
SHARE-BASED COMPENSATION
Granted	917,738
Kaixin 2019 Plan \| Restricted shares were subject to graded vesting
SHARE-BASED COMPENSATION
Vesting period	3 years
Kaixin 2019 Plan \| Restricted shares were subject to graded vesting \| Vests immediately on grant date
SHARE-BASED COMPENSATION
Vesting percentage	62.50%
Kaixin 2019 Plan \| Restricted shares were subject to graded vesting \| Vests monthly subsequent to replacement date
SHARE-BASED COMPENSATION
Vesting percentage	0.0278%

MEZZANINE EQUITY AND WARRANT LIABILITIES - Additional information (Details) - USD ($)			1 Months Ended		12 Months Ended
	Apr. 08, 2021	Dec. 29, 2020	Aug. 31, 2021	Mar. 31, 2021	Dec. 31, 2022	Dec. 28, 2020
Mezzanine equity and warrant liabilities
Conversion price			$ 3.00
Exercise price of warrants		$ 3.00
Volume-weighted average price					$ 3.00
Fair value allocated to warrrants					$ 1,690,000
Converted stocks			1,089,145
Re-measurement of warrants					$ 24,000
Number of warrants exercised					0
Series A Preferred Stock
Mezzanine equity and warrant liabilities
Fair value allocated to preferred shares					$ 1,310,000
Conversion of outstanding shares			3,000
Purchase Agreement
Mezzanine equity and warrant liabilities
Total amount of investment agreed		$ 6,000,000
Preferred shares, issued		3,000
Proceeds from issuance of convertible preferred stock		$ 3,000,000
Exercise price of warrants		$ 3.00
Kaixin Auto Holdings
Mezzanine equity and warrant liabilities
Total amount of investment agreed				$ 6,000,000
Preferred shares, issued	6,000
Proceeds from issuance of convertible preferred stock	$ 6,000,000
Conversion price					$ 3.00
Kaixin Auto Holdings \| Purchase Agreement
Mezzanine equity and warrant liabilities
Preferred shares, authorized						1,000,000
Conversion price						$ 3.00
Series A Warrants
Mezzanine equity and warrant liabilities
Warrants issued/granted		$ 1,500,000
Series B Warrants
Mezzanine equity and warrant liabilities
Warrants issued/granted		1,333,333
Series C Warrants
Mezzanine equity and warrant liabilities
Warrants issued/granted		$ 2,000,000

EQUITY (Tables)

12 Months Ended

Dec. 31, 2022

EQUITY

Schedule of fair value measurement inputs and valuation techniques


	As of July 3, 2022
	2022 Warrant
Risk-free rate of return		2.60	%
Estimated volatility rate		57.21	%
Dividend yield		0	%
Spot price of underling ordinary share		1.035
Exercise price	$	1
Fair value of warrant	$	2,027

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY

12 Months Ended

Dec. 31, 2022

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY

23.CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY

The Group performed a test on the restricted net assets of consolidated subsidiaries and VIEs in accordance with Securities and Exchange Commission Regulation S-X Rule 4-08 (e) (3), “General Notes to Financial Statements” and concluded that the Group is required to disclose the financial statements for the parent Company.

CONDENSED PARENT COMPANY BALANCE SHEETS


	As of December 31,
	2021		2022
ASSETS
Cash and cash equivalents		—		171
Other receivables, net		—		9,830
Amounts due from related parties		—		3,726
Investment in subsidiaries and consolidated VIEs	$	29,662	$	27,964
Total assets		29,662		41,691

LIABILITIES AND SHAREHOLDERS’ EQUITY
Accrued expenses and other current liabilities		—		4,257
Amounts due to related parties		—		200
Convertible note		—		4,305
Other liability		—		1,614
Total liabilities		—		10,376

Shareholders’ equity
Ordinary Shares (par value of $0.00005 per shares; 1,000,000,000 shares authorized, 163,129,655 and 238,368,861 shares issued as of December 31, 2021 and 2022, respectively. 163,129,655 and 228,250,210 shares issued and outstanding as of December 31, 2021 and 2022, respectively)		8		11
Series D convertible preferred shares (par value of $0.0001, 6,000 shares authorized as of December 31, 2021 and 2022, respectively. 6,000 shares issued and outstanding as of December 31, 2021 and 2022 respectively)		1		3
Additional paid-in capital		227,310		312,831
Accumulated deficit		(198,294)		(283,000)
Accumulated other comprehensive income (loss)		637		1,470
Total shareholders’ equity		29,662		31,315
Total liabilities and shareholders’ equity	$	29,662	$	41,691

CONDENSED PARENT COMPANY STATEMENTS OF OPERATIONS


	For the years ended December 31,
	2020		2021		2022
Operating income:
Share of loss of subsidiaries and VIEs	$	(166)	$	(196,579)	$	(78,256)
General and administrative expenses		—		—		(5,897)
Other income		—		—		(465)

Income before income tax expense		(166)		(196,579)		(84,619)
Income tax expense		—		—		—
Net income		(166)		(196,579)		(84,619)

CONDENSED PARENT COMPANY STATEMENTS OF CASH FLOW


	For the years ended December 31,
	2020		2021		2022
Cash flows from operating activities	$	—	$	—	$	(2,410)
Cash flows from investing activities		—		—		—
Cash flows from financing activities		—		—		(165)
Net increase in cash, cash equivalents and restricted cash		—		—		(2,575)
Cash, cash equivalents and restricted cash, at beginning of year		—		—		2,746
Cash, cash equivalents and restricted cash, at end of year	$	—	$	—	$	171

RELATED PARTY TRANSACTIONS AND BALANCES (Tables)

12 Months Ended

Dec. 31, 2022


	Name	Relationship
(a)	Mr. Lin Mingjun (“Mr. Lin”)	A controlling shareholder and chief executive officer of the Group
(b)	Renren Inc.	A non-controlling shareholder of the Company


	As of December 31,
	2021		2022
Renren and its subsidiaries(1)	$	3,943	$	1,427
Mr. Lin		—		200
Amounts due to related parties	$	3,943	$	1,627

(1)

The balance mainly represented the advance fund provided by Renren and its subsidiaries to finance the Group’s daily operations. The amount due to Renren and its subsidiaries of $2,516 were stripped off in conjunction with the disposal of the subsidiaries (Note 4).

INTANGIBLE ASSETS, NET (Tables)

12 Months Ended

Dec. 31, 2022

INTANGIBLE ASSETS, NET

Schedule of finite-lived intangible assets


	As of December 31,
	2021		2022
Trademark ⁽¹⁾	$	14,983	$	15,100
Software		445		72
Total		15,428		15,172
Less: Accumulated amortization		(788)		(2,269)
Intangible assets, net	$	14,640	$	12,903

(1)

The trademark was identified due to the reverse acquisition of KAH with Haitaoche on June 25, 2021. It has remaining useful life of 8.5 years as of December 31, 2022.

LEASE

12 Months Ended

Dec. 31, 2022

LEASE

LEASE

12.LEASE

The weighted average remaining lease terms and discount rates for the operating lease as of December 31, 2022 were as follows:


Remaining lease term and discount rate:
Weighted average remaining lease term (years)	4
Weighted average discount rate	11.5	%

For the years ended December 31, 2021 and 2022, $515 and nil newly operating lease asset was obtained in exchange for operating lease liabilities, cash prepaid for amounts included in the measurement of lease liabilities were nil, $31 and nil for the years ended December 31, 2020, 2021 and 2022.

During the years ended December 31, 2020, 2021 and 2022, the Company incurred total operating lease expenses of $2, $29 and $133 respectively.

As of December 31, 2022, the future minimum rent payable under non-cancelable operating leases were:


2023	$	159
2024		129
2025		133
2026		100
2027		—
Total lease payments		521
Less: imputed interest		(91)
Present value of lease liabilities	$	430
Lease liabilities - current		119
Lease liabilities – non-current		311

REVERSE ACQUISITION - Pro forma information for the periods (Details) - HKD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Business acquisition, pro forma information
Revenue	$ 257,631	$ 34,367
Net loss	$ (191,468)	$ (5,486)

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
CURRENT ASSETS:
Cash and cash equivalents	$ 7,102	$ 5,263
Inventories	31	404
Other receivables	8,848
Prepayment for vehicle purchase and other current assets, net	26,321	53,270
TOTAL CURRENT ASSETS	42,302	58,937
Property and equipment, net	49	22
Intangible assets, net	12,903	14,640
Operating lease right-of-use assets	428	561
TOTAL NON-CURRENT ASSETS	13,380	15,223
TOTAL ASSETS	55,682	74,160
CURRENT LIABILITIES:
Accounts payable		295
Advances from customers		553
Short-term borrowings	2,000	6,277
Short-term operating lease liabilities	119	85
Convertible notes	4,305
Income tax payable	776	3,399
Amounts due to related parties	1,627	3,943
Warrant liability	24	340
Payable for sales incentive	1,638
Accrued expenses and other current liabilities	9,379	14,491
TOTAL CURRENT LIABILITIES	19,868	29,383
Long-term bank loan		2,000
Long-term lease liabilities	311	431
Convertible notes		2,022
Payable for dealership settlement		2,245
TOTAL NON-CURRENT LIABILITIES	311	6,698
TOTAL LIABILITIES	20,179	36,081
COMMITMENT AND CONTIGENCIES
SHAREHOLDERS' EQUITY
Ordinary Shares (par value of $0.00005 per shares; 1,000,000,000 shares authorized, 163,129,655 and 238,368,861 shares issued as of December 31, 2021 and 2022, respectively. 163,129,655 and 228,250,210 shares issued and outstanding as of December 31, 2021 and 2022, respectively)	11	8
Series D convertible preferred shares (par value of $0.0001, 6,000 and 6,000 shares authorized as of December 31, 2021 and 2022, respectively. 6,000 shares and 6,000 issued and outstanding as of December 31, 2021 and 2022 respectively.) Series F convertible preferred shares (par value of 0.00005, nil and 50,000 shares authorized as of December 31, 2021 and 2022, respectively. Nil and 50,000 issued and outstanding as of December 31, 2021 and 2022 respectively.)	3	1
Additional paid-in capital	312,831	227,310
Statutory reserve	8	8
Accumulated deficit	(283,008)	(198,302)
Accumulated other comprehensive income	1,470	637
TOTAL KAIXIN AUTO HOLDINGS' SHAREHOLDERS' EQUITY	31,315	29,662
Non-controlling interests	4,188	8,417
TOTAL EQUITY	35,503	38,079
TOTAL LIABILITIES AND EQUITY	$ 55,682	$ 74,160

SHARE-BASED COMPENSATION

12 Months Ended

Dec. 31, 2022

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

21.SHARE-BASED COMPENSATION

Kaixin incentive plans

(a)

Kaixin Auto Holdings Incentive Plan (the “Kaixin 2019 Plan”)

On April 30, 2019, KAH adopted Kaixin 2019 Plan, whereby 4,715,700 ordinary shares of KAH are made available for future grant for employees of KAH share options or restricted shares.

On May 3, 2019 (the “Replacement Date”), the Company’s board of directors approved a directive to replace all the outstanding share options granted during the year ended December 31, 2018 under the 2018 Plan to 144 employees with 2,186,364 options and 2,183,828 restricted shares. The exercise price of the options was reduced from $1.70 per share to $0.01 per share. The replacement options were subject to graded vesting over three years from the Replacement Date, in which 25% ~ 62.5% of the options granted to each individual vest on the grant date immediately and 1/36 of their remaining options vests monthly subsequent to the Replacement Date. For the restricted shares, there were 205,215 replacement restricted shares granted to certain employees vested immediately and 917,738 replacement restricted shares were subject to graded vesting, which were vested 1/4 annually starting from January 1, 2020. The remaining replacement restricted shares were subject to graded vesting over three years from the Replacement Date, in which 62.5% of the total restricted shares vest on the grant date immediately and 1/36 of the remaining restricted shares vests monthly subsequent to the Replacement Date.

21.SHARE-BASED COMPENSATION CONTINUED

(b)

Kaixin Auto Holdings Incentive Plan (the “Kaixin 2020 Plan”)

On November 17, 2020, the board of directors of KAH approved the Kaixin 2020 Plan, under which, up to 5,000,000 ordinary shares may be granted as awards in form of share options, restricted shares or restricted shares units. In the event of a change in control or another transaction having a similar effect, then any incentives granted under the 2020 Incentive Plan shall be deemed vested immediately. No such award has been granted during the year ended December 31, 2020. The Company has granted 5,181,778 restricted shares under the Kaixin 2020 Plan in 2021.

On July 12, 2021, the board of directors of KAH approved the Kaixin 2021 Plan. The maximum number of ordinary shares that may be delivered pursuant to awards granted under the Kaixin 2021 Plan is 26,596,000. As of December 31, 2021, the Company has granted 20,535,000 restricted shares under the Kaixin 2021 Plan.

(d) Kaixin Auto Holdings Incentive Plan (the “Kaixin 2022 Plan”)

On May 16, 2022, the board of directors of KAH approved the Kaixin 2022 Plan. The maximum number of ordinary shares that may be delivered pursuant to awards granted under the Kaixin 2022 Plan is 39,500,000. As of December 31, 2022, the Company has granted 38,500,000 restricted shares under the Kaixin 2022 Plan.

In determining the fair value of share options in 2019, a binomial option pricing model is applied. Assumptions used to estimate the fair values of the share options granted or modified on grant date were as follows:


	Grant date
Risk-free interest rate ⁽¹⁾		2.50-3.00	%
Volatility ⁽²⁾		45%-46	%
Expected term (in years)⁽³⁾		10
Exercise price ⁽⁴⁾	$	0.01
Dividend yield ⁽⁵⁾		—
Fair value of underlying ordinary share ⁽⁶⁾	$	2.12-$3.36

(1)

Risk-free interest rate

Risk-free interest rate was estimated based on the yield to maturity of treasury bonds of the United States with a maturity period close to the expected life of the options, and the country risk spread between China and United States was considered.

(2)

Volatility

The volatility of the underlying ordinary shares during the life of the options was estimated based on the historical stock price volatility of listed comparable companies over a period comparable to the expected term of the options.

(3)

Expected term

For the options granted to employees, the Company estimated the expected term based on the vesting and contractual terms and employee demographics. For the options granted to non-employees, the Company estimated the expected term as the original contractual term.

(4)

Exercise price

The exercise price of the options was determined by the Company’s board of directors.

(5)

Dividend yield

The dividend yield was estimated by the Company based on its expected dividend policy over the expected term of the options.

21.SHARE-BASED COMPENSATION-CONTINUED

(6)

Fair value of underlying ordinary shares

Prior to the consummation of the listing, the estimated fair value of the ordinary shares underlying the options as of the valuation date was determined based on a contemporaneous valuation. When estimating the fair value of the ordinary shares on the valuation dates, management has considered a number of factors, including the result of a third-party appraisal of the Company, while taking into account standard valuation methods and the achievement of certain events. The fair value of the ordinary shares in connection with the option grants on the valuation date was determined with the assistance of an independent third-party appraiser. The fair values of the underlying ordinary shares on each date of the grant after April 30, 2019, were the closing prices of the Company’s ordinary shares traded in the Stock Exchange.

The estimated fair value of restricted shares granted on each date of the grant under Kaixin 2020 Plan and Kaixin 2021 plan were the closing prices on the relevant grant date of the Company’s ordinary shares traded in the Stock Exchange.

A summary of the Company’s share options activities held by the Company’s employees for the year ended December 31, 2022 was as follows:


				Weighted
				average		Weighted
		Weighted		grant day		Average
		Average		fair		Remaining	Aggregate
Options Granted to Employees	Number of	Exercise		Value per		Contractual	Intrinsic
and Directors	Shares	Price		shares		Years	value
Outstanding as of December 31, 2021	167,151		0.02		3.17	0.99		1.12
Forfeited	(145,478)		0.02		3.17	—		—
Granted	—		—		—	—		—
Exercised	—		—		—	—		—
Outstanding as of December 31, 2022	21,673		0.02		3.17	6.34		0.27
Expected to vest as of December 31, 2022	—		—		—	—		—
Exercisable as of December 31, 2022	21,673		0.02		3.17	6.34		0.27

The aggregate intrinsic value was calculated as the difference between the exercise price of the underlying awards and the closing stock price of $0.29 of the Company’s ordinary share on December 31,2022.

As of December 31, 2022, there was approximately $462 of total unrecognized compensation cost related to unvested share options. The unrecognized compensation costs are expected to be recognized over a weighted average period of 2.66 years.

A summary of the nonvested restricted shares activity as of December 31, 2022 is as follows:


		Weighted average fair value
	Number of nonvested	per ordinary share
	restricted shares	at the grant dates
Outstanding as of December 31, 2021	5,441,630	2.55
Forfeited	(5,000,000)	0.94
Granted	43,500,000	0.87
Vested	38,911,292	1.03
Unvested as of December 31, 2022	5,030,339	1.34

As of December 31, 2022, there was approximately $7,308 of total unrecognized compensation cost related to unvested restricted shares. The unrecognized compensation costs are expected to be recognized over a weighted average period of 5.10 years.

The total fair value of shares vested during the years ended December 31, 2020, 2021 and 2022 was nil, 38,669 and $40,078.

21.SHARE-BASED COMPENSATION-CONTINUED

Total share-based compensation expense of share-based awards granted to employees and directors for the years ended December 31, 2020, 2021 and 2022 were as follows:


	For the Years ended December 31,
	2020		2021		2022
Selling and marketing	$	—	$	264	$	239
Research and development		—		55		44
General and administrative		—		41,270		39,027
Total share-based compensation expense	$	—	$	41,589	$	39,310

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Foreign currency translation adjustment, tax	$ 0	$ 0

DISPOSAL OF SUBSIDIARIES - Carrying amounts of the major classes of assets and liabilities of the Disposal Group (Details) - Disposal Group - Stanley Star $ in Thousands	Oct. 27, 2022 USD ($)
DISPOSAL OF SUBSIDIARIES
Cash and cash equivalents	$ 97
Prepaid expenses and other current assets	1,983
Property and equipment, net	4
Intangible assets, net	20
TOTAL ASSETS	2,104
Accounts payable	(257)
Advance from customers	(163)
Long-term bank loan	(5,476)
Income tax payable	(2,225)
Amount due to Kaixin	(8,848)
VAT payable	(3,340)
Accrual expenses and other current liabilities	(6,071)
Total Liabilities	(26,380)
Net liabilities	$ (24,276)

SHARE-BASED COMPENSATION - Kaixin Auto 2020 Plan (Details) - Kaixin Auto Group 2020 Plan - shares		12 Months Ended
	Nov. 17, 2020	Dec. 31, 2021	Dec. 31, 2020
SHARE-BASED COMPENSATION
Granted	5,000,000
Number of shares granted			0
Restricted shares
SHARE-BASED COMPENSATION
Options granted		5,181,778

SHARE-BASED COMPENSATION - Kaixin Auto Group 2021 Plan (Details)	Dec. 31, 2022 shares
Kaixin Auto Group 2021 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate number of shares to be issued	26,596,000

REVERSE ACQUISITION

12 Months Ended

Dec. 31, 2022

REVERSE ACQUISITION

REVERSE ACQUISITION

3.	REVERSE ACQUISITION

On June 25, 2021, KAH issued (the “Issuance”) an aggregate of 74,035,502 ordinary shares through private placement to several former shareholders of Haitaoche in exchange of 100% of the share capital of Haitaoche, pursuant to the share purchase agreement (the “SPA”) entered into on December 31, 2020. Following the Issuance, Haitaoche became a wholly-owned subsidiary of KAH. Upon the consummation of the Issuance, KAH had a total of 143,460,495 outstanding ordinary shares, and former shareholders of Haitaoche accounted for 51.61%, became the controlling shareholders of KAH. Therefore, the shareholders of Haitaoche controlled the largest portion of the voting rights in the consolidated entity, and the management of Haitaoche became the management of the consolidated entity after the reverse acquisition. The transaction is a business combination under ASC 805, using acquisition method of accounting.

The fair value of the consideration paid as part of the transaction as well as the fair value of identifiable assets and liabilities acquired are presented below.


	Amount
	$
Fair value of consideration transferred ⁽¹⁾		161,760

Fair value of the assets acquired and the liabilities assumed
Cash and cash equivalents		4,299
Prepaid expense		46,708
Property plant and equipment		31
Trademark (Intangible Assets)		15,100
Right-of-use assets		47
Goodwill		143,655
Subtotal of total assets		209,840
Short-term bank loan		(8,195)
Accounts payable		(406)
Advance from customers		(461)
Short-term lease liabilities		(32)
Other payables		(13,198)
Amounts due to RPT		(4,288)
Income tax payable		(4,079)
Warrants		(2,335)
Mezzanine equity-Preferred shares		(1,437)
Subtotal of total liabilities		(34,431)
Less: Non-controlling interest		(7,649)
Less: Preferred shares ⁽²⁾		(6,000)
Total net assets		161,760

(1)

The fair value of 69,424,993 ordinary shares issued to pre-reverse acquisition KAH shareholders is $161,760 based on the quoted fair market value of $2.33 per ordinary share on June 25, 2021.

(2)

It represented Series D convertible preferred shares of KAH issued to Renren Inc. on April 8, 2021 (see Note 15)

3.REVERSE ACQUISITION-CONTINUED

The unaudited pro forma information for the periods set forth below gives effect to the reverse acquisition as if the reverse acquisition had occurred as of January 1, 2020. This pro forma information is presented for informational purposes only and is not necessarily indicative of the results of operations that actually would have been achieved had the transactions been consummated as of that time.


	For the years ended December 31,
	2020		2021
	Unaudited		Unaudited
Revenue	$	34,367	$	257,631
Net loss	$	(5,486)	$	(191,468)

EQUITY (Details)	Jun. 25, 2021 shares
Haitaoche
Equity
Issuance of shares through private placement	74,035,502

EQUITY - Preferred shares (Details) - USD ($) $ / shares in Units, $ in Thousands		1 Months Ended	12 Months Ended
	Apr. 08, 2021	Mar. 31, 2021	Dec. 31, 2022	Mar. 24, 2023	Aug. 31, 2021
Equity
Conversion price					$ 3.00
Percentage of after-tax profits required to be allocated to general reserve			10.00%
General reserve as a percentage of registered capital up to which after-tax profit of PRC subsidiaries and VIEs shall be transferred			50.00%
Stanley Star
Equity
Preferred stock, outstanding				$ 50,000
Kaixin Auto Holdings
Equity
Total amount of investment agreed		$ 6,000
Number of ordinary shares consisted by units			2,000,000
Preferred Stock, Shares Issued	6,000
Proceeds from investment in convertible preferred shares	$ 6,000

OTHER NON-CURRENT ASSETS, NET (Details) $ in Thousands	Dec. 31, 2021 USD ($)
OTHER NON-CURRENT ASSETS, NET
Long-term receivables from suppliers	$ 4,112
Legal deposit	104
Other non-current assets, gross	4,216
Less: impairment for uncollectible receivables	(4,216)
Prepayment amounts purchase of automobiles	$ 3,916

INCOME TAXES - Movements of valuation allowances (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Rollforward of valuation allowances of deferred tax assets
Balance as of beginning of year	$ 25,240	$ 388	$ 402
Current year addition	5,267	1,454	63
Current year reversal	(7,039)	(753)
Reduction due to usage of NOL	(42)	(25)	(21)
Reduction due to statute expiration	(288)	(193)	(56)
Decrease in disposal of subsidiaries	(22,077)
Reverse acquisition		23,843
Exchange rate effect		526
Balance as of the end of the year	$ 1,061	$ 25,240	$ 388

REVERSE ACQUISITION - Fair value of equity consideration - Haitaoche (Details) $ / shares in Units, $ in Thousands	Jun. 25, 2021 USD ($) $ / shares shares
Fair value of the assets acquired and the liabilities assumed
Cash and cash equivalents	$ 4,299
Prepaid expense	46,708
Property plant and equipment	31
Trademark (Intangible Assets)	15,100
Right-of-use assets	47
Goodwill	143,655
Subtotal of total assets	209,840
Short-term bank loan	(8,195)
Accounts payable	(406)
Advance from customers	(461)
Short-term lease liabilities	(32)
Other payables	(13,198)
Amounts due to RPT	(4,288)
Income tax payable	(4,079)
Warrants	(2,335)
Mezzanine equity-Preferred shares	(1,437)
Subtotal of total liabilities	(34,431)
Less: Non-controlling interest	(7,649)
Less: Preferred shares	(6,000)
Total net assets	161,760
Haitaoche
The purchase price comprised of:
Fair value of consideration transferred	$ 161,760
Fair value of the assets acquired and the liabilities assumed
Shares issued to pre-reverse acquisition \| shares	69,424,993
Fair value of shares issued for pre-reverse the acquisition	$ 161,760
Issuance price \| $ / shares	$ 2.33

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Others (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($) segment ¥ / $	Dec. 31, 2021 USD ($) ¥ / $	Dec. 31, 2020 USD ($) ¥ / $
Inventories
Period for considering vehicle as slow moving	90 days
Write down of inventory	$ 0	$ 0	$ 0
Prepaid expenses, other current assets and other non-current assets
Allowance recognized during the year	0	4,216	0
Impairment loss for prepayment for vehicle purchase and other current assets	22,921	0
Impairment loss for other non-current asset	$ 0	$ 4,216	$ 0
Foreign currency translation
Foreign currency exchange rate \| ¥ / $	6.8972	6.3726
Foreign currency, average translation rate \| ¥ / $	6.7290	6.3914	6.7434
Segment reporting
Number of geographical segments \| segment	0
Impairment of long-lived assets
Impairment loss for other non-current asset	$ 0	$ 4,216	$ 0

OTHER NON-CURRENT ASSETS, NET (Tables)

12 Months Ended

Dec. 31, 2022

Other assets, noncurrent

Schedule of other non-current assets


	As of December 31,
	2021		2022
Long-term receivables from suppliers ⁽¹⁾	$	4,112	$	—
Legal deposit		104		—
Other non-current assets, gross	$	4,216	$	—
Less: impairment for uncollectible receivables ⁽²⁾		(4,216)		—
Other non-current assets, net		—		—

(1)

Other non-current assets mainly represented the receivable from a foreign supplier, Brueggmann Group (“BG”) in Germany for payment of automobiles purchase early in 2016. BG has never delivered the automobiles. The Gross prepayment amounts were $3,916 as of December 31, 2021, which were stripped off in conjunction with the disposal of the subsidiaries (Note 4).

(2)

As the Defendants have appealed against the judgement in January, 2022, the Company expects that Defendants are not willing to repay the receivables even if Defendants lose the lawsuit. The Company recognized impairment of $4,216 for the receivables from BG and the legal deposit as well as the other suppliers as of December 31, 2021.

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY - BALANCE SHEETS (Parenthetical) (Details) - $ / shares	Dec. 31, 2022	Dec. 31, 2021
CONDENSED PARENT COMPANY BALANCE SHEETS
Ordinary shares, par value (in dollars per share)	$ 0.00005	$ 0.00005
Ordinary shares, authorized	1,000,000,000	1,000,000,000
Ordinary shares, issued	238,368,861	163,129,655
Ordinary shares outstanding	228,250,210	163,129,655
Parent \| Legal entities
CONDENSED PARENT COMPANY BALANCE SHEETS
Ordinary shares, par value (in dollars per share)	$ 0.00005	$ 0.00005
Ordinary shares, authorized	1,000,000,000	1,000,000,000
Ordinary shares, issued	238,368,861	163,129,655
Ordinary shares outstanding	228,250,210	163,129,655
Preferred shares, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred shares, authorized	6,000	6,000
Preferred shares, issued	6,000	6,000
Preferred shares, outstanding	6,000	6,000

DISPOSAL OF SUBSIDIARIES - Narrative Information (Details) - USD ($) $ in Thousands	Mar. 24, 2023	Dec. 31, 2022	Dec. 28, 2022	Oct. 27, 2022	Aug. 05, 2022	Dec. 31, 2021
DISPOSAL OF SUBSIDIARIES
Fair value of preferred shares issued				$ 24,592
Accumulated other comprehensive loss		$ 1,470		2,060		$ 637
Stanley Star
DISPOSAL OF SUBSIDIARIES
Total consideration					$ 1
Convertible preferred shares issued			50,000
Preferred stock, outstanding	$ 50,000
Fair value of preferred shares issued				$ 24,600

- Definition

Accumulated change in equity from transactions and other events and circumstances from non-owner sources, net of tax effect, at period end. Excludes Net Income (Loss), and accumulated changes in equity from transactions resulting from investments by owners and distributions to owners. Includes foreign currency translation items, certain pension adjustments, unrealized gains and losses on certain investments in debt and equity securities, other than temporary impairment (OTTI) losses related to factors other than credit losses on available-for-sale and held-to-maturity debt securities that an entity does not intend to sell and it is not more likely than not that the entity will be required to sell before recovery of the amortized cost basis, as well as changes in the fair value of derivatives related to the effective portion of a designated cash flow hedge.

+ References + Details

Document and Entity Information	12 Months Ended
Document and Entity Information	Dec. 31, 2022 shares
Entity Addresses
Document Type	20-F
Document Registration Statement	false
Document Annual Report	true
Document Period End Date	Dec. 31, 2022
Document Transition Report	false
Document Shell Company Report	false
Entity File Number	001-38261
Entity Registrant Name	Kaixin Auto Holdings
Entity Incorporation, State or Country Code	E9
Entity Address, Address Line One	9/F, Tower A, Dongjin International Center
Entity Address, Address Line Two	Huagong Road,
Entity Address, Address Line Three	Chaoyang District
Entity Address, City or Town	Beijing
Entity Address, Postal Zip Code	100015
Entity Address, Country	CN
Title of 12(b) Security	Ordinary shares, par value US$0.00005 per share
Trading Symbol	KXIN
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding	228,250,210
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	No
Entity Interactive Data Current	No
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	false
Document Accounting Standard	U.S. GAAP
Entity Shell Company	false
Auditor Name	Marcum Asia CPAs LLP
Auditor Firm ID	5395
Auditor Location	New York, NY
Entity Central Index Key	0001713539
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	FY
Amendment Flag	false
Business Contact [Member]
Entity Addresses
Entity Address, Address Line One	9/F, Tower A, Dongjin International Center
Entity Address, Address Line Two	Huagong Road,
Entity Address, Address Line Three	Chaoyang District
Entity Address, City or Town	Beijing
Entity Address, Postal Zip Code	100015
Entity Address, Country	CN
Contact Personnel Name	Yi Yang
City Area Code	86
Local Phone Number	10 6720 4948

LOSS PER SHARE (Tables)

12 Months Ended

Dec. 31, 2022

LOSS PER SHARE

Schedule of computation of basic and diluted net loss per ordinary share


	For the years ended December 31,
	2020			2021	2022
Net loss attributable to Kaixin Auto Holdings’ shareholders	$	(166)	$	(196,579)	$	(84,706)

Weighted average number of ordinary shares outstanding used in computing net loss per ordinary share - basic and diluted, shares retroactively adjusted for the reverse acquisition on June 25, 2021)		74,035,502		114,416,353		200,167,152

Loss per share attributable to Kaixin Auto Holdings’ shareholders - basic and diluted	$	(0.0022)	$	(1.7181)	$	(0.0004)

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY - BALANCE SHEETS (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Oct. 27, 2022	Dec. 31, 2021
ASSETS
Cash and cash equivalents	$ 7,102		$ 5,263
Other receivables	8,848
TOTAL ASSETS	55,682		74,160
LIABILITIES AND SHAREHOLDERS' EQUITY
Accrued expenses and other current liabilities	9,379		14,491
Amounts due to related parties	1,627		3,943
TOTAL LIABILITIES	20,179		36,081
SHAREHOLDERS' EQUITY
Ordinary Shares (par value of $0.00005 per shares; 1,000,000,000 shares authorized, 163,129,655 and 238,368,861 shares issued as of December 31, 2021 and 2022, respectively. 163,129,655 and 228,250,210 shares issued and outstanding as of December 31, 2021 and 2022, respectively)	11		8
Series D convertible preferred shares (par value of $0.0001, 6,000 and 6,000 shares authorized as of December 31, 2021 and 2022, respectively. 6,000 shares and 6,000 issued and outstanding as of December 31, 2021 and 2022 respectively.) Series F convertible preferred shares (par value of 0.00005, nil and 50,000 shares authorized as of December 31, 2021 and 2022, respectively. Nil and 50,000 issued and outstanding as of December 31, 2021 and 2022 respectively.)	3		1
Additional paid-in capital	312,831		227,310
Accumulated deficit	(283,008)		(198,302)
Accumulated other comprehensive loss	1,470	$ 2,060	637
TOTAL KAIXIN AUTO HOLDINGS' SHAREHOLDERS' EQUITY	31,315		29,662
TOTAL LIABILITIES AND EQUITY	55,682		74,160
Legal entities \| Parent
ASSETS
Cash and cash equivalents	171
Other receivables	9,830
Amounts due from related parties	3,726
Investment in subsidiaries and consolidated VIEs	27,964		29,662
TOTAL ASSETS	41,691		29,662
LIABILITIES AND SHAREHOLDERS' EQUITY
Accrued expenses and other current liabilities	4,257
Amounts due to related parties	200
Convertible note	4,305
Other liability	1,614
TOTAL LIABILITIES	10,376
SHAREHOLDERS' EQUITY
Ordinary Shares (par value of $0.00005 per shares; 1,000,000,000 shares authorized, 163,129,655 and 238,368,861 shares issued as of December 31, 2021 and 2022, respectively. 163,129,655 and 228,250,210 shares issued and outstanding as of December 31, 2021 and 2022, respectively)	11		8
Series D convertible preferred shares (par value of $0.0001, 6,000 and 6,000 shares authorized as of December 31, 2021 and 2022, respectively. 6,000 shares and 6,000 issued and outstanding as of December 31, 2021 and 2022 respectively.) Series F convertible preferred shares (par value of 0.00005, nil and 50,000 shares authorized as of December 31, 2021 and 2022, respectively. Nil and 50,000 issued and outstanding as of December 31, 2021 and 2022 respectively.)	3		1
Additional paid-in capital	312,831		227,310
Accumulated deficit	(283,000)		(198,294)
Accumulated other comprehensive loss	1,470		637
TOTAL KAIXIN AUTO HOLDINGS' SHAREHOLDERS' EQUITY	31,315		29,662
TOTAL LIABILITIES AND EQUITY	$ 41,691		$ 29,662

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

12 Months Ended

Dec. 31, 2022

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

9.ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES


	As of December 31,
	2021		2022
Loan payable⁽¹⁾	$	—	$	3,000
Accrued professional fee		2,698		2,215
Individual income tax payable		2,207		2,207
Used car services payables		3,333		419
Other taxes payable		5,120		181
Others		1,133		1,357
Total	$	14,491	$	9,379

(1)

Loan payable consisted of the following:


Lender	Interest rate		Issuance Date	Maturity Date	December 31, 2022
Scytech Limited	0	%	On September 21, 2022	December 31, 2023	$	2,700
CPL Yellow stones Limited	5% per annum		On December 21, 2022	March 31, 2023	$	200
Yunfeiyang Limited	5% per annum		On December 21, 2022	March 31, 2023	$	100

The interest-free loan from Scytech Limited was as working capital for Zhejiang Taohaoche and collateralized by the net assets of Zhejiang Taohaoche. CPL Yellow stones Limited and Yunfeiyang Limited are the shareholders of the Company.

SHARE-BASED COMPENSATION - Summary of share options outstanding (Details) - USD ($)		12 Months Ended
	May 03, 2019	Dec. 31, 2022	Dec. 31, 2021
Number of shares
Balance at the beginning of period		167,151
Forfeited		145,478
Balance at the end of period		21,673	167,151
Exercisable, at the end of period		21,673
Weighted average exercise price
Balance at the beginning of period		$ 0.02
Balance at the end of period		0.02	$ 0.02
Exercisable, at the end of period		0.02
Weighted Average grant date fair value per share
Balance at the beginning of period		3.17
Balance at the end of period		3.17	$ 3.17
Exercisable		$ 3.17
Weighted average remaining contractual years
Outstanding at the end of the period (in years)		6 years 4 months 2 days	11 months 26 days
Expected to vest at the end of the period (in years)		0 years
Exercisable at the end of the period (in years)		6 years 4 months 2 days
Weighted average intrinsic value
Outstanding at the end of the period (in dollars)		$ 0.27	$ 1.12
Exercisable at the end of the period (in dollars)		$ 0.27
Kaixin Auto 2019 Plan
Number of shares
Granted	2,186,364

LEASE - Summary of weighted average remaining lease terms and discount rates for the operating lease (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
LEASE
Weighted-average remaining lease terms	4 years
Weighted-average discount rate:	11.50%
Operating lease asset	$ 0	$ 515
Cash prepaid for the operating lease asset	0	31	$ 0
Operating lease expense	$ 133	$ 29	$ 2

INCOME TAXES - Reconciliation (Details) - USD ($)	12 Months Ended
INCOME TAXES - Reconciliation (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
INCOME TAXES
Net loss before provision for income taxes	$ 84,545,000	$ 196,657,000	$ 166,000
PRC statutory tax rate	25.00%	25.00%	25.00%
Income tax at statutory tax rate	$ 21,136,000	$ 49,164,000	$ 42,000
Impairment of goodwill		$ (35,914,000)
Reversal of taxable deemed interest income from inter-company interest-free loans		1354.00%
Fair value change on warrants	(79.00%)	500.00%
Non-deductible loss and SBC expenses not deductible for tax purposes	$ (13,427,000)	$ (13,262,000)
Effect of income tax rate differences in jurisdictions other than the PRC	$ (1,721,000)	$ (437,000)
NOL not applicable for carryforward	(288.00%)	(193.00%)	(56.00%)
Changes in valuation allowance	$ (5,339)	$ (483)	$ 14
Income tax benefit (expenses)	$ (74,000)	$ 729,000
Effective tax rates	0.00%	0.38%

DEALERSHIP SETTLEMENT

12 Months Ended

Dec. 31, 2022

DEALERSHIP SETTLEMENT

DEALERSHIP SETTLEMENT

10.DEALERSHIP SETTLEMENT

During 2017 and 2018, the Company entered into several equity purchase agreements (the “Equity Purchase Agreements”) with the Dealership Operators, to acquire 70% equity interest of the dealerships. According to the Equity Purchase Agreements, the Company agreed to provide certain payments of its ordinary shares to the Dealership Operators as part of the equity acquisition considerations, subject to certain payment triggers including the operating performance of the dealerships and service centers and KAH’s ordinary share price (“Contingent Consideration”). The Company recognized the Contingent Consideration as liability at fair value as of the acquisition date and the subsequent changes in fair value as gain/loss into earnings/(loss). In connection with the Company’s IPO on April 30, 2019, Renren Inc. (“Renren”) agreed to assume the Contingent Consideration from the Company, and the Company reclassified the Contingent Consideration from a liability to additional paid-in capital.

Since 2019, due to disagreements with certain Dealership Operators on operational matters, the Company had disruptions in operations of several dealerships. After continuous negotiations with the Dealership Operators, the Company signed the amendments to Equity Purchase Agreement (the “Amendments”) with seven Dealership Operators in August 2021, to 1) confirm a total of 4,513,761 ordinary shares as the first batch and the first two tranches of second batch of the Contingent Consideration issuable to the Dealership Operators in accordance with the Equity Purchase Agreements subject to the operating performance of the dealerships and service centers before 2021; 2) provide a total of 7,172,529 ordinary shares (“Compensation Shares”) to the Dealership Operators, in the purpose of alleviation of losses and distress that occurred during the temporary halt of business in the Dealerships after the breakout of the pandemic and the historical dispute between the Company and the Dealership Operators. The number of Compensation Shares was determined through negotiation of the Company with each of the Dealership Operators while taking into consideration the hardships they experienced over the prior years and the need to make prompt resolution of the historical dispute with the Dealership Operators. The Company recognized the Compensation Shares as loss related to provision for dealership settlement based on fair value of the Compensation Shares by reference to share-based payment transactions pursuant to ASC 718.

10.DEALERSHIP SETTLEMENT-CONTINUED

On November 30, 2021, Renren transferred 13,422,613 ordinary shares of the Company it held, to an escrow company to fully settle the Contingent Consideration shares of 8,219,510. In addition to the Contingent Consideration shares, there were 5,203,103 ordinary shares transferred toward settlement of the Compensation Shares, which are recognized by the Company as additional paid-in capital with a fair value of $8,897 based on the quoted price of Company’s ordinary share on the date of Renren’s transfer were treated by reference to a liability paid by the principal shareholder and thus recorded as the loss related to provision for dealership settlement in the Company’s financial statements with a corresponding credit to additional paid-in capital. The Company shall issue additional 1,969,425 shares to the Dealership Operators to fully satisfy the Compensation Shares, which was recognized as payables loss related to provision for dealership settlement with a corresponding accrual of for dealership settlement at the fair value by reference to the quoted price of Company’s ordinary share at the commitment date with subsequent changes in fair value reflected in provision for dealership settlement. The Company, Renren and Dealership Operators agreed that the transfer of shares by Renren to the escrow company shall be deemed as fulfilment of Renren’s obligations related to the Contingent Consideration. According to the Amendments, the Dealership Operators should honor their commitments, including paying off their outstanding payables and debts to the Company, in order to obtain the shares. Consequently, the 13,422,613 shares have been held by the escrow company since transferred from Renren, and were disclosed as issued and outstanding shares in the vesting of restricted shares award reverse acquisition item during 2021 in the Company’s Consolidated Statements of Changes in Equity. The escrow companies provide a pledge guarantee to fulfill dealership operators’ repayment obligations with shares it held. Proceeds from the sale of shares will be preferentially used to repay the outstanding payables and debts to Kaixin. The payables accrued for dealership settlement were $2,245 as of December 31, 2021. The total loss related to provision of the 7,172,529 Compensation Shares to the Dealership Operators for the dealership settlement was $11,142 for the year 2021.

In May 2022, the Company signed supplemental agreements to Equity Purchase Agreement (the “Supplemental Agreements”) with seven Dealership Operators, to confirm a total of 21,566,328 ordinary shares as the remaining three tranches of the second batch of the Contingent Consideration will be issued to the Dealership Operators. Since then, the total of Consideration Shares and Compensation Shares were confirmed to be 33,748,772 ordinary shares. On May 26, 2022, the Company issued 20,326,159 ordinary shares to the Dealership Operators and then put the shares into an escrow account. The 20,326,159 shares are recognized by the Company as ordinary shares and additional paid-in capital with a total fair value of $17,379 based on the quoted price of Company’s ordinary share on the date of transfer. The payable for dealership settlement recognized as of December 31, 2021 amounting to $2,245 was also fully settled by the shares issued. As agreed with the Dealership Operators, the ordinary shares in the escrow companies were used to secure the repayment of the Dealership Operators’ outstanding payables to the Company.

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2022	Dec. 31, 2021
Ordinary shares, par value (in dollars per share)	$ 0.00005	$ 0.00005
Ordinary shares, authorized	1,000,000,000	1,000,000,000
Ordinary shares, issued	238,368,861	163,129,655
Ordinary shares outstanding	228,250,210	163,129,655
Series D convertible preferred shares
Preferred shares, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred shares, authorized	6,000	6,000
Preferred shares, issued	6,000	6,000
Preferred shares, outstanding	6,000	6,000
Series F convertible preferred shares
Preferred shares, par value (in dollars per share)	$ 0.00005	$ 0.00005
Preferred shares, authorized	50,000	0
Preferred shares, issued	50,000	0
Preferred shares, outstanding	50,000	0

OTHER RECEIVABLES

12 Months Ended

Dec. 31, 2022

OTHER RECEIVABLES

OTHER RECEIVABLES

5.OTHER RECEIVABLES


Borrower	Interest rate		Amount
Shanghai Changda	0	%	$	6,858
Anhui Xin Jieying	0	%	$	1,990
Total			$	8,848

Other receivables comprised two interest-free borrowings to the former subsidiaries Shanghai Changda and Anhui Xin Jieying, which were disposed of in the disposal of subsidiaries during 2022, with a total balance of $8,848 as of the end of 2022. The Company expects that the Buyer is willing and able to repay the receivables within 1 year. The Company did not recognize any valuation allowance for the receivables.

OTHER NON-CURRENT ASSETS, NET

12 Months Ended

Dec. 31, 2022

OTHER NON-CURRENT ASSETS, NET

OTHER NON-CURRENT ASSETS, NET

8.OTHER NON-CURRENT ASSETS, NET

As of December 31, 2021 and 2022, other non-current assets consisted of the following:


	As of December 31,
	2021		2022
Long-term receivables from suppliers ⁽¹⁾	$	4,112	$	—
Legal deposit		104		—
Other non-current assets, gross	$	4,216	$	—
Less: impairment for uncollectible receivables ⁽²⁾		(4,216)		—
Other non-current assets, net		—		—

(1)

(2)

MEZZANINE EQUITY AND WARRANT LIABILITIES (Tables)

12 Months Ended

Dec. 31, 2022

MEZZANINE EQUITY AND WARRANT LIABILITIES

Schedule of fair value of the warrants calculated using the Black-Scholes pricing model


	As of December 31, 2021
	Series A Warrant			Series B Warrant			Series C Warrant
Risk-free rate of return		1.41	%		0.24	%		1.46	%
Estimated volatility rate		45.82	%		50.55	%		46.99	%
Dividend yield		—	%		—	%		—	%
Spot price of underling ordinary share		1.14			1.14			1.14
Exercise price	$	3		$	3		$	3
Fair value of warrant	$	335		$	3		$	2


	As of December 31, 2022
	Series A Warrant			Series B Warrant			Series C Warrant
Risk-free rate of return		4.12	%		4.53	%		4.12	%
Estimated volatility rate		55.29	%		54.43	%		54.38	%
Dividend yield		0	%		0	%		0	%
Spot price of underling ordinary share		0.29			0.29			0.29
Exercise price	$	3		$	3		$	3
Fair value of warrant	$	24		$	—		$	—

SHARE-BASED COMPENSATION - Nonvested Restricted Shares (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	May 03, 2019	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Kaixin Auto Group 2021 Plan
Weighted average fair value per ordinary shares at the granted dates
Weighted average period for unrecognized compensation cost		2 years 7 months 28 days
Restricted Stock [Member] \| Kaixin Auto 2019 Plan
Number of nonvested restricted shares
Granted	2,183,828
Restricted Stock [Member] \| Kaixin Auto Group 2021 Plan
Number of nonvested restricted shares
Balance at the beginning of period		5,441,630
Granted		43,500,000
Vested		38,911,292
Forfeited		5,000,000
Balance at the end of period		5,030,339	5,441,630
Weighted average fair value per ordinary shares at the granted dates
Balance at the beginning of period		$ 2.55
Granted		0.87
Vested		1.03
Forfeited		0.94
Balance at the end of period		$ 1.34	$ 2.55
Total unrecognized compensation cost		$ 7,308
Weighted average period for unrecognized compensation cost		5 years 1 month 6 days
Total fair value of shares vested		$ 40,078	$ 38,669	$ 0

EQUITY - Series F Preferred Shares (Details) $ / shares in Units, $ in Thousands, ¥ in Millions			1 Months Ended		12 Months Ended
	Dec. 28, 2022 USD ($) $ / shares shares	Mar. 14, 2022 USD ($) $ / shares shares	Jan. 31, 2022 USD ($)	Jan. 31, 2022 CNY (¥)	Dec. 31, 2022 USD ($) shares	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 USD ($) shares	Dec. 31, 2020 USD ($)	Dec. 31, 2022 CNY (¥) shares	Jan. 31, 2022 CNY (¥)	Dec. 29, 2020 $ / shares
Class of Stock [Line Item]
Ordinarty shares subscribed					$ 11		$ 8
Ordinary shares, issued \| shares					238,368,861		163,129,655		238,368,861
Warrants exercise price \| $ / shares											$ 3.00
Paid issuance cost					$ 1,976
General and administrative expenses					46,488		$ 43,734	$ 265
Stanley Star Group
Class of Stock [Line Item]
Total amount of investment agreed	$ 50,000,000
Number of ordinary shares consisted by units \| shares	50,000,000
Conversion price \| $ / shares	$ 1.00
Derong Group
Class of Stock [Line Item]
Ordinarty shares subscribed			$ 15,400							¥ 100
Ordinary shares, issued \| shares		4,406,542
Warrant share issued \| shares		6,500,000
Warrants exercise price \| $ / shares		$ 1.00
Warrant shares classified as equity measured at fair value		$ 1,417			472
Proceeds allocated to issued ordinary shares		$ 3,298
Paid issuance cost					1,575	¥ 100
Payment received from investment			$ 4,600	¥ 30		¥ 30
General and administrative expenses					$ 1,103
Uncertainty of Remaining Investment. \| ¥									¥ 70

LEASE - Summary of future minimum rent payable under non-cancellable operating leases (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2023	$ 159
2024	129
2025	133
2026	100
Total lease payments	521
Less: Imputed interest	(91)
Present value of lease liabilities	430
Lease liabilities - current	119
Lease liabilities - non-current	$ 311	$ 431

ORGANIZATION AND PRINCIPAL ACTIVITIES - Additional Information (Details) - USD ($) $ in Thousands	Jun. 25, 2021	Dec. 31, 2022	Dec. 31, 2021
Short-term borrowing		$ 2,000	$ 6,277
Haitaoche
Issuance of shares through private placement	74,035,502
Equity interest subscribed	100.00%

INCOME TAXES - Principal components of the deferred tax assets and liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Deferred tax assets:
Write-down of Prepaid expenses and other current assets	$ 477	$ 4,249
Write-down of inventory		3,874
Provision for doubtful accounts		2,315
Write down of other non-current assets		1,054
Accrued expense		207
Accrued payroll and welfare		61
Advertising expense		6
Net operating loss carry forwards	584	13,474	$ 388
Subtotal	1,061	25,240	388
Valuation allowance	$ (1,061)	$ (25,240)	$ (388)	$ (402)

PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables)

12 Months Ended

Dec. 31, 2022

PREPAID EXPENSES AND OTHER CURRENT ASSETS

Schedule of prepaid expenses and other current assets


	As of December 31,
	2021		2022
Prepayment for vehicle purchase⁽¹⁾	$	32,091	$	18,252
Other receivables from dealerships ⁽²⁾		19,249		9,546
Deductible input VAT		545		7
Advance to suppliers		23		—
Others ⁽³⁾		1,362		191
Total		53,270		27,996
Less: valuation allowance		—		(1,675)
Prepaid expenses and other current assets	$	53,270	$	26,321

(1)

The balance mainly represents pre-payments to the dealership operators who are operators of the used car dealership with whom the Company set up special purpose holding companies to operate the used car business, mainly to purchase used vehicles from the market.

(2)

The balance represents cash advances paid to the dealership operators for purchasing used vehicles historically and shall be repaid in cash, and the balance is secured using ordinary shares of the Company issued to them as agreed with the dealership operator (Note 10).

(3)

Others mainly included prepaid rent, staff advances, prepaid marketing fee, advertising fee, professional fee, and other receivables incurred for daily operations.

(4)

The Company recorded impairment loss of nil and $22,921 for prepayment for vehicle purchase and other current assets for the years ended December 31, 2021 and 2022.

REVERSE ACQUISITION - Narratives (Details) - shares	Jun. 25, 2021	Dec. 31, 2022	Dec. 31, 2021
REVERSE ACQUISITION
Common stock, shares outstanding		228,250,210	163,129,655
Former shareholders of Haitaoche \| Kaixin auto holdings
REVERSE ACQUISITION
Percentage of ownership interest	51.61%
Haitaoche
REVERSE ACQUISITION
Issuance of shares through private placement	74,035,502
Equity interest subscribed	100.00%
Common stock, shares outstanding	143,460,495

EQUITY - Warrants (Details) - USD ($)	12 Months Ended
EQUITY - Warrants (Details) - USD ($)	Dec. 31, 2022	Dec. 31, 2017	Dec. 31, 2021	Dec. 29, 2020
Equity
Warrants outstanding	263,863
Exercise price of warrants				$ 3.00
Share-based Compensation Arrangements by Share-based Payment Award, Options, Forfeitures in Period, Weighted Average Exercise Price	$ 0.02
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Weighted Average Grant Date Fair Value	$ 3.17
Restricted net assets	$ 121,656,000		$ 117,085,000
Underwriters call option
Equity
Price Per Unit		$ 10.00
Number of units exercisable		900,000
Aggregate exercise price		$ 9,000,000
Expiration period		5 years
2019 warrants
Equity
Warrants outstanding	1,000,000
Exercise price of warrants	$ 11.50
Class Of Warrant Or Right, Redemption Of Warrants Or Rights, Stock Price Trigger	$ 0.01
Minimum threshold written notice period for redemption of warrants	30 days
Closing price of share for threshold trading days	20 days
Closing price of share for threshold consecutive trading days	3 days
Class Of Warrant Or Right, Redemption Of Warrants Or Rights, Last Sales Price of the Ordinary Shares	$ 18.00
Issued With Units In The IPO
Equity
Warrants outstanding		10,318,145
Issued To E&A Callet
Equity
Warrants outstanding	375,000
Kaixin Auto Holdings \| 2019 warrants
Equity
Warrants outstanding	11,957,008

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (84,619)	$ (195,928)	$ (166)
Adjustments to reconcile net loss to net cash used in operating activities of continuing operations:
Depreciation and amortization	1,681	787	5
Impairment of goodwill		143,655
Loss from the disposal of property and equipment		8
Fair value change of warrants	(316)	(1,995)
Share-based compensation	39,310	41,589
Foreign currency exchange (gain) loss	(139)	432	(86)
Impairment of prepaid expenses and other current assets	22,921	4,216
Provision for dealership settlement	15,134	11,142
Provision for sales incentive	1,638
Gain on disposal of subsidiaries	(1,578)
Financial expenses	1,103
Interest expenses of convertible note in interest method	683	22
Changes in operating assets and liabilities:
Inventories	373	(404)
Prepayment for vehicle purchase and other current assets	355	(6,121)	(437)
Amount due from related parties		326	(509)
Accounts payable	(38)	(111)
Advances from customers	(390)	(318)	326
Accrued expenses and other current liabilities	1,984	1,287	1
Short-term lease liabilities	(98)	(31)
Amount due to related parties		25	(269)
Income tax payable	(398)	(684)
Net cash used in operating activities	(2,394)	(2,103)	(1,135)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net	59
Purchase of intangible assets		(32)	(290)
Cash acquired on reverse acquisition		4,299
Cash disposed on disposal of subsidiaries	(97)
Net cash (used in) provided by investing activities	(156)	4,267	(290)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of ordinary shares and warrant	4,717
Proceeds from convertible note	2,000	2,000
Cash paid for offering cost	(1,976)
Capital contribution	665		8,095
Capital divestment			(5,963)
Net cash provided by financing activities	5,406	2,000	2,132
Effect of exchange rate changes on cash and cash equivalents	(1,017)	492	(104)
Net changes in cash and cash equivalents	1,839	4,656	603
Cash and cash equivalents at beginning of year	5,263	607	4
Cash and cash equivalents at end of year	7,102	5,263	$ 607
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Interest expense paid	(362)	(23)
Income tax paid	(26)
NON-CASH ACTIVITIES:
Net assets acquired on reverse acquisition		161,760
Issuance of Series F preferred shares in connection a disposal of subsidiaries	$ (24,593)
Vesting of restricted shares award		1
Obtaining right-of-use assets in exchange for operating lease liabilities		$ 515

FAIR VALUE MEASUREMENTS - Fair value hierarchy for assets and liabilities measured at fair value (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Fair Value Measurements
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount	$ 0	$ 0
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount	0	0
Fair Value, Liabilities, Level 1 to Level 2 Transfers, Amount	$ 0	0
Significant Other Unobservable Inputs (Level 3) \| Terminal growth rate
Fair Value Measurements
Goodwill measurement input	2.50%
Significant Other Unobservable Inputs (Level 3) \| Forecasted inflation rate
Fair Value Measurements
Goodwill measurement input	2.50%
Significant Other Unobservable Inputs (Level 3) \| Discount rate
Fair Value Measurements
Goodwill measurement input	12.00%
Recurring
Fair Value Measurements
Total	$ (24)	(340)
Recurring \| Significant Other Unobservable Inputs (Level 3)
Fair Value Measurements
Warrant liability	$ (24)	$ (340)

LEASE (Tables)

12 Months Ended

Dec. 31, 2022

LEASE

Summary of weighted average remaining lease terms and discount rates for the operating lease

The weighted average remaining lease terms and discount rates for the operating lease as of December 31, 2022 were as follows:


Remaining lease term and discount rate:
Weighted average remaining lease term (years)	4
Weighted average discount rate	11.5	%

Schedule of future minimum rent payable under non-cancelable operating leases

As of December 31, 2022, the future minimum rent payable under non-cancelable operating leases were:


2023	$	159
2024		129
2025		133
2026		100
2027		—
Total lease payments		521
Less: imputed interest		(91)
Present value of lease liabilities	$	430
Lease liabilities - current		119
Lease liabilities – non-current		311

INTANGIBLE ASSETS, NET

12 Months Ended

Dec. 31, 2022

INTANGIBLE ASSETS, NET

INTANGIBLE ASSETS, NET

7.INTANGIBLE ASSETS, NET


	As of December 31,
	2021		2022
Trademark ⁽¹⁾	$	14,983	$	15,100
Software		445		72
Total		15,428		15,172
Less: Accumulated amortization		(788)		(2,269)
Intangible assets, net	$	14,640	$	12,903

(1)

The trademark was identified due to the reverse acquisition of KAH with Haitaoche on June 25, 2021. It has remaining useful life of 8.5 years as of December 31, 2022.

Amortization expense was $2, $785 and $1,531 for the years ended December 31, 2020, 2021 and 2022, respectively.

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY- STATEMENTS OF CASH FLOWS (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Changes in operating assets and liabilities:
Cash flows from operating activities	$ (2,394)	$ (2,103)	$ (1,135)
CASH FLOWS FROM INVESTING ACTIVITIES:
Cash flows from investing activities	(156)	4,267	(290)
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash flows from financing activities	5,406	2,000	2,132
Cash and cash equivalents at beginning of year	5,263	607	4
Cash and cash equivalents at end of year	7,102	5,263	$ 607
Parent
Changes in operating assets and liabilities:
Cash flows from operating activities	(2,410)
CASH FLOWS FROM FINANCING ACTIVITIES:
Cash flows from financing activities	(165)
Net increase in cash, cash equivalents and restricted cash	(2,575)
Cash and cash equivalents at beginning of year	2,746
Cash and cash equivalents at end of year	$ 171	$ 2,746

SHARE-BASED COMPENSATION - Share-based compensation expense (Details) - Kaixin Auto Group 2021 Plan - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	$ 39,310	$ 41,589
Selling and marketing
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	239	264
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	44	55
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total share-based compensation expense	$ 39,027	$ 41,270

ORGANIZATION AND PRINCIPAL ACTIVITIES - Summary of major subsidiaries (Details)	Dec. 31, 2022
Kaixin Auto Group ("KAG")
ORGANIZATION AND PRINCIPAL ACTIVITIES
Percentage of ownership	100.00%
Jet Sound Hong Kong Company Limited
ORGANIZATION AND PRINCIPAL ACTIVITIES
Percentage of ownership	100.00%
Zhejiang Taohaoche Technology Co., Ltd.
ORGANIZATION AND PRINCIPAL ACTIVITIES
Percentage of ownership	100.00%
Zhejiang Kaixin Auto Co., Ltd
ORGANIZATION AND PRINCIPAL ACTIVITIES
Percentage of ownership	100.00%
Chongqing Jieying Shangyue Automobile Sales Co., Ltd.
ORGANIZATION AND PRINCIPAL ACTIVITIES
Percentage of ownership	100.00%
Wuhan Jieying Chimei Automobile Sales Co., Ltd.
ORGANIZATION AND PRINCIPAL ACTIVITIES
Percentage of ownership	100.00%
Anhui Kaixin New Energy Vehicle Co., Ltd.
ORGANIZATION AND PRINCIPAL ACTIVITIES
Percentage of ownership	100.00%

LOSS PER SHARE

12 Months Ended

Dec. 31, 2022

LOSS PER SHARE

LOSS PER SHARE

20.LOSS PER SHARE

The following table sets forth the computation of basic and diluted net loss per ordinary share for the years ended:


	For the years ended December 31,
	2020			2021	2022
Net loss attributable to Kaixin Auto Holdings’ shareholders	$	(166)	$	(196,579)	$	(84,706)

Weighted average number of ordinary shares outstanding used in computing net loss per ordinary share - basic and diluted, shares retroactively adjusted for the reverse acquisition on June 25, 2021)		74,035,502		114,416,353		200,167,152

Loss per share attributable to Kaixin Auto Holdings’ shareholders - basic and diluted	$	(0.0022)	$	(1.7181)	$	(0.0004)

Since the Group is in a net loss for the years ended December 31, 2020, 2021 and 2022 presented in these financial statements, the potential dilutive securities were not included in the calculation of dilutive net loss per share where their inclusion would be anti-dilutive. And no dilutive security was issued for the years ended December 31, 2020, 2021 and 2022, there was no difference between the Group’s basic and diluted net loss per share for the periods presented. The potential dilutive securities that were not included in the calculation of dilutive loss per share in those periods are nil, 167,151 and 167,151 respectively, for the years ended December 31, 2020, 2021 and 2022 , as inclusion would have been anti-dilutive.

SHARE-BASED COMPENSATION (Tables)

12 Months Ended

Dec. 31, 2022

SHARE-BASED COMPENSATION

Schedule of Assumptions used to estimate the fair values of the share options granted


	Grant date
Risk-free interest rate ⁽¹⁾		2.50-3.00	%
Volatility ⁽²⁾		45%-46	%
Expected term (in years)⁽³⁾		10
Exercise price ⁽⁴⁾	$	0.01
Dividend yield ⁽⁵⁾		—
Fair value of underlying ordinary share ⁽⁶⁾	$	2.12-$3.36

(1)

Risk-free interest rate

(2)

Volatility

(3)

Expected term

(4)

Exercise price

The exercise price of the options was determined by the Company’s board of directors.

(5)

Dividend yield

The dividend yield was estimated by the Company based on its expected dividend policy over the expected term of the options.

(6)

Fair value of underlying ordinary shares

Kaixin Auto

SHARE-BASED COMPENSATION

Summary of share options activities


				Weighted
				average		Weighted
		Weighted		grant day		Average
		Average		fair		Remaining	Aggregate
Options Granted to Employees	Number of	Exercise		Value per		Contractual	Intrinsic
and Directors	Shares	Price		shares		Years	value
Outstanding as of December 31, 2021	167,151		0.02		3.17	0.99		1.12
Forfeited	(145,478)		0.02		3.17	—		—
Granted	—		—		—	—		—
Exercised	—		—		—	—		—
Outstanding as of December 31, 2022	21,673		0.02		3.17	6.34		0.27
Expected to vest as of December 31, 2022	—		—		—	—		—
Exercisable as of December 31, 2022	21,673		0.02		3.17	6.34		0.27

Schedule of Total share-based compensation expense of share-based awards granted to employees and directors


	For the Years ended December 31,
	2020		2021		2022
Selling and marketing	$	—	$	264	$	239
Research and development		—		55		44
General and administrative		—		41,270		39,027
Total share-based compensation expense	$	—	$	41,589	$	39,310

Kaixin Auto | Restricted Stock

SHARE-BASED COMPENSATION

Summary of share options activities


		Weighted average fair value
	Number of nonvested	per ordinary share
	restricted shares	at the grant dates
Outstanding as of December 31, 2021	5,441,630	2.55
Forfeited	(5,000,000)	0.94
Granted	43,500,000	0.87
Vested	38,911,292	1.03
Unvested as of December 31, 2022	5,030,339	1.34

INCOME TAXES - Components of income tax expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
INCOME TAXES
Current income tax benefit (expense)	$ (74)	$ 729
Total income tax benefit (expense)	$ (74)	$ 729

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Loan payable	$ 3,000
Accrued professional fee	2,215	$ 2,698
Individual income tax payable	2,207	2,207
Used car services payables	419	3,333
Other taxes payable	181	5,120
Others	1,357	1,133
Total	$ 9,379	$ 14,491

LOSS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Net loss:
NET LOSS ATTRIBUTABLE TO KAIXIN'S SHAREHOLDERS	$ (84,706)	$ (196,579)	$ (166)
Weighted average shares used in calculating net loss per share - Basic	200,167,152	114,416,353	74,035,502
Weighted average number of ordinary shares outstanding used in computing net loss per ordinary share - diluted shares retroactively adjusted for the reverse acquisition on June 25, 2021)	200,167,152	114,416,353	74,035,502
Net (loss) income per ordinary share attributable to Kaixin Auto Holdings' shareholders - basic:
Net loss per share - basic	$ (0.0004)	$ (1.7181)	$ (0.0022)
Net loss per share - diluted	$ (0.0004)	$ (1.7181)	$ (0.0022)
Dilutive security issued shares	0	0	0
Potential dilutive securities that were not included in the calculation of dilutive loss per share	167,151	167,151	0

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

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+ Details

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)

12 Months Ended

Dec. 31, 2022

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Schedule of accrued expenses and other current liabilities


	As of December 31,
	2021		2022
Loan payable⁽¹⁾	$	—	$	3,000
Accrued professional fee		2,698		2,215
Individual income tax payable		2,207		2,207
Used car services payables		3,333		419
Other taxes payable		5,120		181
Others		1,133		1,357
Total	$	14,491	$	9,379

(1)

Loan payable consisted of the following:


Lender	Interest rate		Issuance Date	Maturity Date	December 31, 2022
Scytech Limited	0	%	On September 21, 2022	December 31, 2023	$	2,700
CPL Yellow stones Limited	5% per annum		On December 21, 2022	March 31, 2023	$	200
Yunfeiyang Limited	5% per annum		On December 21, 2022	March 31, 2023	$	100

Schedule of loan payable


Lender	Interest rate		Issuance Date	Maturity Date	December 31, 2022
Scytech Limited	0	%	On September 21, 2022	December 31, 2023	$	2,700
CPL Yellow stones Limited	5% per annum		On December 21, 2022	March 31, 2023	$	200
Yunfeiyang Limited	5% per annum		On December 21, 2022	March 31, 2023	$	100

SHARE-BASED COMPENSATION - Assumptions used in determining the fair value of share options granted (Details) - Kaixin Auto Group 2021 Plan	12 Months Ended
	Dec. 31, 2022 $ / shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Risk-free interest rate, minimum	2.50%
Risk-free interest rate, maximum	3.00%
Volatility, minimum	45.00%
Volatility, maximum	46.00%
Expected term (in years)	10 years
Exercise price	$ 0.01
Dividend yield	0.00%
Fair value of the shares	$ 0.29
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of the shares	2.12
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of the shares	$ 3.36

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
CONSOLIDATED STATEMENTS OF OPERATIONSCONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
REVENUE, NET	$ 82,840	$ 253,840	$ 1,207
Cost of revenues	82,194	248,583	1,207
GROSS PROFIT	646	5,257
Selling and marketing expenses	2,097	481	11
General and administrative expenses	46,488	43,734	265
Impairment of goodwill		143,655
Total operating expenses	48,585	187,870	276
LOSS FROM OPERATIONS	(47,939)	(182,613)	(276)
Other income (expenses), net	728	(4)	25
Foreign currency exchange gain (loss)	(139)	(432)	86
Interest expense, net	(1,034)	(245)	(1)
Gain on disposal of subsidiaries	1,578
Change in fair value of warrants	316	1,995
Impairment of prepaid expenses and other current assets	(22,921)	(4,216)
Provision for dealership settlement	(15,134)	(11,142)
LOSS BEFORE INCOME TAX PROVISION	(84,545)	(196,657)	(166)
Income tax benefit (expenses)	(74)	729
NET LOSS	(84,619)	(195,928)	(166)
Less: net income attributable to non-controlling interests	87	651
NET LOSS ATTRIBUTABLE TO KAIXIN'S SHAREHOLDERS	(84,706)	(196,579)	(166)
Other comprehensive income
Foreign currency translation adjustment	1,866	512	181
COMPREHENSIVE INCOME (LOSS)	(82,753)	(195,416)	15
Less: comprehensive income attributable to non-controlling interest	(940)	768
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO KAIXIN'S SHAREHOLDERS	$ (81,813)	$ (196,184)	$ 15
Net loss per share
Net loss per share - basic	$ (0.0004)	$ (1.7181)	$ (0.0022)
Net loss per share - diluted	$ (0.0004)	$ (1.7181)	$ (0.0022)
Weighted average shares used in calculating net loss per share
Weighted average shares used in calculating net loss per share - Basic	200,167,152	114,416,353	74,035,502
Weighted average shares used in calculating net loss per share - Diluted	200,167,152	114,416,353	74,035,502

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue recognition (Details) ¥ in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)	Dec. 31, 2022 CNY (¥)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REVENUE, NET	$ 82,840		$ 253,840	$ 1,207
Advances from customers			553
Income Tax Expense (Benefit)	$ 74		(729)
PRC
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Income Tax Limitations Extended Period	5 years	5 years
Income Tax Expense (Benefit)	$ 15,500	¥ 100,000
Used-car sales
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REVENUE, NET	80,034		251,054
New-car wholesales
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
REVENUE, NET	$ 2,806		$ 2,786	$ 1,207

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

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+ Details

SHARE-BASED COMPENSATION - Fair value of share options granted (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	May 03, 2019	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Kaixin Auto 2019 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted	2,186,364
Kaixin Auto Group 2021 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Closing stock price		$ 0.29
Unrecognized share-based compensation expense		$ 462
Unrecognized share-based compensation expense, expected recognition period		2 years 7 months 28 days
Kaixin Auto Group 2021 Plan \| Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options granted		20,535,000
Unrecognized share-based compensation expense, expected recognition period		5 years 1 month 6 days
Fair value of options vested		$ 40,078	$ 38,669	$ 0

EQUITY - Calculation of warrants using Black-Scholes pricing model (Details)	Jul. 03, 2020
Risk-free rate
Measurement Inputs
Fair value of warrants	0.0260
Volatility
Measurement Inputs
Fair value of warrants	0.5721
Expected dividend rate
Measurement Inputs
Fair value of warrants	0
Spot price of underling ordinary share
Measurement Inputs
Fair value of warrants	0.01035
Exercise price
Measurement Inputs
Fair value of warrants	0.01
Fair value of warrant
Measurement Inputs
Fair value of warrants	20.27

MEZZANINE EQUITY AND WARRANT LIABILITIES

12 Months Ended

Dec. 31, 2022

MEZZANINE EQUITY AND WARRANT LIABILITIES

MEZZANINE EQUITY AND WARRANT LIABILITIES

17.MEZZANINE EQUITY AND WARRANT LIABILITIES

Insurance of convertible preferred shares and warrants

On December 28, 2020, KAH entered into a definitive securities purchase agreement with U.S. based KX Ventures 4 LLC (the “Investor”) and completed the initial closing on December 29, 2020.

Pursuant to the agreement, the Investor will invest $6,000 in newly designated Series A convertible preferred shares (the “Series A Preferred Shares”) of KAH. The first $3,000 of the investment closed on December 29, 2020 (the “First Closing”). The Series A Preferred Shares are convertible into 1,000,000 ordinary shares of KAH’s at a conversion price of $3.00, subject to customary adjustments. Pursuant to the Purchase Agreement, the Investor will also receive warrants to subscribe for KAH’s ordinary shares at an exercise price of $3.00 per share.

In connection with the issuance of 3,000 convertible preferred shares at the First Closing, 1,500,000 Series A Warrants, 1,333,333, Series B Warrants and 2,000,000 Series C Warrants (collectively the “Warrants”) were issued to the Investor, with each warrant provided the holder the right to subscribe for KAH’s ordinary shares at an exercise price of $3.00 per share. Series A and Series B Warrants are immediately exercisable, and Series C Warrants are exercisable upon exercise and in proportion to the number of Series B Warrants exercised. Series A, B and C warrants expire on December 29, 2027, August 29, 2024 and June 29, 2028, respectively.

The Series A Preferred Shares and Warrants are bundled transactions, which were considered as equity-linked instruments. The management has determined that there was beneficial conversion feature attributable to the preferred shares because the initial effective conversion prices of these preferred shares were lower than the fair value of KAH’s ordinary shares at the relevant commitment dates, and the effect of beneficial conversion feature was recognized in additional paid-in capital.

The Group classified the Series A Preferred Shares as mezzanine equity instead of permanent equity on the consolidated balance sheets since they were contingently redeemable upon the occurrence of the redemption event, that is if the Volume-weighted average price is less than $3.00 on the 54-month anniversary of the applicable Original Issue Date (December 29, 2020) and expired in 2025, which is outside the Group’s control. The fair value allocated to the Series A Preferred Shares was $1,310 at the date of the First Closing. The Warrants are classified as a liability and the fair value allocated to warrants was $1,690 as of the date of the First Closing.

The Group accrete changes in the redemption value over the period from the date of issuance to the earliest redemption date (June 1, 2025) of the instrument using the interest method. In August 2021, total Series A preferred Shares of $3,000 were converted at conversion price of $3.00 into 1,089,145 ordinary shares of the Company.

The Warrants were classified as the warrant liability on the issuance date and as of December 31, 2020, 2021 and 2022, which was re-measured at fair value of $24 as of December 31, 2022, and will be re-measured at each reporting period until the warrants are exercised or expire and any changes will be recognized in the statement of operations. No warrants were exercised as of December 31, 2022.

17.MEZZANINE EQUITY AND WARRANT LIABILITIES-CONTINUED


	As of December 31, 2021
	Series A Warrant			Series B Warrant			Series C Warrant
Risk-free rate of return		1.41	%		0.24	%		1.46	%
Estimated volatility rate		45.82	%		50.55	%		46.99	%
Dividend yield		—	%		—	%		—	%
Spot price of underling ordinary share		1.14			1.14			1.14
Exercise price	$	3		$	3		$	3
Fair value of warrant	$	335		$	3		$	2


	As of December 31, 2022
	Series A Warrant			Series B Warrant			Series C Warrant
Risk-free rate of return		4.12	%		4.53	%		4.12	%
Estimated volatility rate		55.29	%		54.43	%		54.38	%
Dividend yield		0	%		0	%		0	%
Spot price of underling ordinary share		0.29			0.29			0.29
Exercise price	$	3		$	3		$	3
Fair value of warrant	$	24		$	—		$	—

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY (Tables)

12 Months Ended

Dec. 31, 2022

CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY

Schedule of CONDENSED PARENT COMPANY BALANCE SHEETS


	As of December 31,
	2021		2022
ASSETS
Cash and cash equivalents		—		171
Other receivables, net		—		9,830
Amounts due from related parties		—		3,726
Investment in subsidiaries and consolidated VIEs	$	29,662	$	27,964
Total assets		29,662		41,691

LIABILITIES AND SHAREHOLDERS’ EQUITY
Accrued expenses and other current liabilities		—		4,257
Amounts due to related parties		—		200
Convertible note		—		4,305
Other liability		—		1,614
Total liabilities		—		10,376

Shareholders’ equity
Ordinary Shares (par value of $0.00005 per shares; 1,000,000,000 shares authorized, 163,129,655 and 238,368,861 shares issued as of December 31, 2021 and 2022, respectively. 163,129,655 and 228,250,210 shares issued and outstanding as of December 31, 2021 and 2022, respectively)		8		11
Series D convertible preferred shares (par value of $0.0001, 6,000 shares authorized as of December 31, 2021 and 2022, respectively. 6,000 shares issued and outstanding as of December 31, 2021 and 2022 respectively)		1		3
Additional paid-in capital		227,310		312,831
Accumulated deficit		(198,294)		(283,000)
Accumulated other comprehensive income (loss)		637		1,470
Total shareholders’ equity		29,662		31,315
Total liabilities and shareholders’ equity	$	29,662	$	41,691

Schedule of CONDENSED PARENT COMPANY STATEMENTS OF OPERATIONS


	For the years ended December 31,
	2020		2021		2022
Operating income:
Share of loss of subsidiaries and VIEs	$	(166)	$	(196,579)	$	(78,256)
General and administrative expenses		—		—		(5,897)
Other income		—		—		(465)

Income before income tax expense		(166)		(196,579)		(84,619)
Income tax expense		—		—		—
Net income		(166)		(196,579)		(84,619)

CONDENSED PARENT COMPANY STATEMENTS OF CASH FLOW


	For the years ended December 31,
	2020		2021		2022
Cash flows from operating activities	$	—	$	—	$	(2,410)
Cash flows from investing activities		—		—		—
Cash flows from financing activities		—		—		(165)
Net increase in cash, cash equivalents and restricted cash		—		—		(2,575)
Cash, cash equivalents and restricted cash, at beginning of year		—		—		2,746
Cash, cash equivalents and restricted cash, at end of year	$	—	$	—	$	171

SHARE-BASED COMPENSATION - Kaixin Auto 2022 Plan (Details) - Kaixin 2022 Plan	12 Months Ended
	Dec. 31, 2022 USD ($) shares
SHARE-BASED COMPENSATION
Aggregate number of shares to be issued \| shares	39,500,000
Consideration for shares granted \| $	$ 38,500,000

MEZZANINE EQUITY AND WARRANT LIABILITIES (Details)	Dec. 31, 2022 $ / shares	Dec. 31, 2021 $ / shares	Jul. 03, 2020
Risk-free rate
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding			0.0260
Risk-free rate \| Series A Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	4.12	1.41
Risk-free rate \| Series B Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	4.53	0.24
Risk-free rate \| Series C Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	4.12	1.46
Volatility
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding			0.5721
Volatility \| Series A Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	55.29	45.82
Volatility \| Series B Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	54.43	50.55
Volatility \| Series C Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	54.38	46.99
Expected dividend rate
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding			0
Expected dividend rate \| Series A Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	0
Expected dividend rate \| Series B Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	0
Expected dividend rate \| Series C Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	0
Spot price of underling ordinary share
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding			0.01035
Spot price of underling ordinary share \| Series A Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	0.29	1.14
Spot price of underling ordinary share \| Series B Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	0.29	1.14
Spot price of underling ordinary share \| Series C Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	0.29	1.14
Exercise price
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding			0.01
Exercise price \| Series A Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	3	3
Exercise price \| Series B Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	3	3
Exercise price \| Series C Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	3	3
Fair value of warrant \| Series A Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding	24	335
Fair value of warrant \| Series B Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding		3
Fair value of warrant \| Series C Warrants
Mezzanine equity and warrant liabilities
Warrants and Rights Outstanding		2

DISPOSAL OF SUBSIDIARIES

12 Months Ended

Dec. 31, 2022

DISPOSAL OF SUBSIDIARIES.

DISPOSAL OF SUBSIDIARIES

4.DISPOSAL OF SUBSIDIARIES

On August 5, 2022, KAG and Stanley Star entered into a shares transfer agreement (the “Agreement”). Pursuant to the Agreement, the Group sell all the shares it held in Renren Finance Inc and its subsidiaries and VIEs and VIEs’ subsidiaries to Stanley Star at a consideration of $1 and additional compensation shall be made if the net liabilities of the Disposal Group were different as of the closing date.

On December 28, 2022, KAG and Stanley Star entered into a supplement agreement to issue $50,000 convertible preferred shares of the Company to Stanley Star as part of consideration to compensate the difference of net asset between the closing date and the agreement date. On March 24, 2023, KAG and Stanley Star entered into an amendment to the supplement agreement that modified specific terms of the $50 million preferred stock issued by the Company to Stanley Star.

On October 27, 2022 the Company calculated a gain regarding the divestiture of Disposal group as follows:


	As of October 27, 2022
Fair value of preferred shares issued to Stanley Star	$	(24,592)
The carrying amount of any noncontrolling interest		(3,954)
Net liabilities		(24,276)
Gain on disposal of subsidiaries	$	3,638

Consideration received presents the fair value of the preferred shares issued to the Buyer as of the closing date and the fair value is approximately $24.6 million. When the Company deconsolidated subsidiaries, the amount of accumulated other comprehensive loss $2,060 is reclassified and partially offset the gain.

4.DISPOSAL OF SUBSIDIARIES-CONTINUED

The divestiture of the Disposal Group did not constitute a strategic shift of the Company’s operations and did not have major effects on the Company’s operations and financial results; therefore, the transactions do not meet the discontinued operations criteria.

The following table summarizes the carrying amounts of the major classes of assets and liabilities of the Disposal Group as of October 27, 2022:


	As of October 27, 2022
Cash and cash equivalents	$	97
Prepaid expenses and other current assets		1,983
Property and equipment, net		4
Intangible assets, net		20
TOTAL ASSETS	$	2,104

Accounts payable		(257)
Advance from customers		(163)
Long-term bank loan		(5,476)
Income tax payable		(2,225)
Amount due to Kaixin		(8,848)
VAT payable		(3,340)
Accrual expenses and other current liabilities		(6,071)
Total Liabilities	$	(26,380)

Net liabilities	$	(24,276)

OTHER RECEIVALBES - Other Receivables (Details) $ in Thousands	Dec. 31, 2022 USD ($)
OTHER RECEIVABLES
Other receivables, total amount	$ 8,848
Shanghai Changda
OTHER RECEIVABLES
Interest rate (as a percent)	0.00%
Other receivables, total amount	$ 6,858
Anhui Xin Jieying
OTHER RECEIVABLES
Interest rate (as a percent)	0.00%
Other receivables, total amount	$ 1,990

BANK BORROWING - Additional information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Borrowing
Amount of loan secured by wholly owned subsidiary Renren Inc.		$ 2,000
Interest Expense	$ 1,034	245	$ 1
East West Bank
Borrowing
Amount of loan secured by wholly owned subsidiary Renren Inc.		$ 2,000
Loan One \| East West Bank
Borrowing
Annual interest rate		6.00%
Loan One \| Qianxiang Shiji Technology Development (Beijing) Co
Borrowing
Amount of loan secured by wholly owned subsidiary Renren Inc.		$ 6,277
Loan Two \| East West Bank
Borrowing
Annual interest rate	2.80%

RELATED PARTY TRANSACTIONS AND BALANCES

12 Months Ended

Dec. 31, 2022

RELATED PARTY TRANSACTIONS AND BALANCES

13.RELATED PARTY TRANSACTIONS AND BALANCES

The table below sets forth the major related parties and their relationships with the Group:


	Name	Relationship
(a)	Mr. Lin Mingjun (“Mr. Lin”)	A controlling shareholder and chief executive officer of the Group
(b)	Renren Inc.	A non-controlling shareholder of the Company

Amounts due to related parties

As of December 31, 2021 and 2022, significant amounts due to related parties consisted of the following:


	As of December 31,
	2021		2022
Renren and its subsidiaries(1)	$	3,943	$	1,427
Mr. Lin		—		200
Amounts due to related parties	$	3,943	$	1,627

(1)

DISPOSAL OF SUBSIDIARIES - Gain regarding divestiture of disposal group (Details) $ in Thousands	Oct. 27, 2022 USD ($)
DISPOSAL OF SUBSIDIARIES.
Fair value of preferred shares issued to Stanley Star	$ (24,592)
The carrying amount of any noncontrolling interest	(3,954)
Net liabilities	(24,276)
Gain on disposal of subsidiaries	$ 3,638

BANK BORROWING (Details) - USD ($) $ in Thousands	Dec. 31, 2022	Dec. 31, 2021
Short-term debt:
Short-term borrowings	$ 2,000	$ 6,277
Long-term debt:
Long-term bank loan		2,000
East West Bank
Short-term debt:
Short-term borrowings	$ 2,000	6,277
Long-term debt:
Long-term bank loan		$ 2,000

PREPAID EXPENSES AND OTHER CURRENT ASSETS

12 Months Ended

Dec. 31, 2022

PREPAID EXPENSES AND OTHER CURRENT ASSETS

PREPAID EXPENSES AND OTHER CURRENT ASSETS

6.PREPAID EXPENSES AND OTHER CURRENT ASSETS

As of December 31, 2021 and 2022, prepaid expenses and other current assets consisted of the following:


	As of December 31,
	2021		2022
Prepayment for vehicle purchase⁽¹⁾	$	32,091	$	18,252
Other receivables from dealerships ⁽²⁾		19,249		9,546
Deductible input VAT		545		7
Advance to suppliers		23		—
Others ⁽³⁾		1,362		191
Total		53,270		27,996
Less: valuation allowance		—		(1,675)
Prepaid expenses and other current assets	$	53,270	$	26,321

(1)

(2)

(3)

Others mainly included prepaid rent, staff advances, prepaid marketing fee, advertising fee, professional fee, and other receivables incurred for daily operations.

(4)

The Company recorded impairment loss of nil and $22,921 for prepayment for vehicle purchase and other current assets for the years ended December 31, 2021 and 2022.

PAYABLE FOR SALES INCENTIVE (Details) $ in Thousands	12 Months Ended
PAYABLE FOR SALES INCENTIVE (Details) $ in Thousands	Dec. 31, 2022 USD ($) shares
Payable for Sales Incentive
Payable for sales incentive	$ 1,638
Dealership Operators
Payable for Sales Incentive
Shares issued as consideration \| shares	5,585,645
Selling expenses	$ 1,638
Payable for sales incentive	$ 1,638

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Loan payable (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2022 USD ($)
Convertible Notes
Loan payable	$ 3,000
Scytech Limited
Convertible Notes
Loan payable, interest rate	0.00%
Loan payable, issuance date	Sep. 21, 2022
Loan payable, maturity date	Dec. 31, 2023
Loan payable	$ 2,700
CPL Yellow stones Limited
Convertible Notes
Loan payable, interest rate	5.00%
Loan payable, issuance date	Dec. 21, 2022
Loan payable, maturity date	Mar. 31, 2023
Loan payable	$ 200
Yunfeiyang Limited
Convertible Notes
Loan payable, interest rate	5.00%
Loan payable, issuance date	Dec. 21, 2022
Loan payable, maturity date	Mar. 31, 2023
Loan payable	$ 100

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2022

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Schedule of estimated useful lives of property and equipment

		Estimated Useful Life
Computer equipment and application software		2 - 3 Years
Furniture and vehicles		5 Years

Schedule of estimated useful lives of intangible assets


		Estimated Useful Life
Software		10 Years
Domain name		10 Years
Trademark		10 Years

Schedule of disaggregation of revenue


	For the year ended December 31,
	2020		2021		2022
Used-car sales	$	—	$	251,054	$	80,034
New-car wholesales		1,207		2,786		2,806
Total revenues	$	1,207	$	253,840	$	82,840

ORGANIZATION AND PRINCIPAL ACTIVITIES

12 Months Ended

Dec. 31, 2022

ORGANIZATION AND PRINCIPAL ACTIVITIES

ORGANIZATION AND PRINCIPAL ACTIVITIES

1.	ORGANIZATION AND PRINCIPAL ACTIVITIES

Kaixin Auto Holdings (“the Company” or “KAH”), was incorporated in the Cayman Islands in 2016.

On June 25, 2021, KAH completed a business combination with Haitaoche Limited (“Haitaoche”, or “HTC”), resulting in KAH acquiring 100% of the share capital of Haitaoche in exchange for an aggregate of 74,035,502 ordinary shares, which was issued to several former shareholders of Haitaoche. The business combination was treated as a reverse acquisition of KAH under ASC 805, using the acquisition method of accounting, and Haitaoche was deemed to be the accounting acquirer. (See Note 3).

Following the completion of the reverse acquisition, KAH is the consolidated parent of Haitaoche and the resulting company operates under the KAH corporate name. Haitaoche’s historical financial statements became the historical financial statements of the Company. The acquired assets and liabilities of KAH are included in the Company’s consolidated balance sheet since June 25, 2021 and the results of its operations and cash flows are included in the Company’s consolidated statement of operations and comprehensive income (loss) and cash flows for periods beginning after June 25, 2021.

The Company and its consolidated subsidiaries, are collectively referred to as the “Group”. The Group is primarily engaged in sales of domestic automobiles and the used car sales business in the People’s Republic of China (“PRC”).

The major subsidiaries of the Company as of December 31, 2022 are summarized as below:


	Later of date of
	incorporation or	Place of	% of
Name of Subsidiaries	acquisition	Incorporation	Ownership		Principal activities
Major subsidiaries:
Kaixin Auto Group (“KAG”)	January 25, 2018	Cayman Islands	100	%	Investment holding
Jet Sound Hong Kong Company Limited	May 7, 2011	Hong Kong	100	%	Investment holding
Zhejiang Taohaoche Technology Co., Ltd.	July 11, 2019	PRC	100	%	New car trading business
Zhejiang Kaixin Auto Co., Ltd	April 4, 2021	PRC	100	%	Used car trading business
Chongqing Jieying Shangyue Automobile Sales Co., Ltd.	July 3, 2017	PRC	100	%	Used car trading business
Wuhan Jieying Chimei Automobile Sales Co., Ltd.	November 20, 2017	PRC	100	%	Used car trading business
Anhui Kaixin New Energy Vehicle Co., Ltd.	January 25, 2022	PRC	100	%	New energy vehicle trading business

Effectively completed on October 27, 2022, the Group disposed all the shares it held in Renren Finance Inc, which holds all the Group’s VIEs and VIEs’ subsidiaries in China (collectively referred to as the “Disposal group”), to Stanley Star Group Inc. (“Stanley Star” or “the Buyer”), a third-party company incorporated in BVI. (See Note 4)

1.	ORGANIZATION AND PRINCIPAL ACTIVITIES-CONTINUED

PRC regulations currently limit direct foreign ownership of business entities providing value-added telecommunications services and internet services in the PRC where certain licenses are required for the provision of such services. To comply with the PRC laws and regulations, the Company used to primarily conduct such kind of business in China through the Company’s VIEs, i.e. Anhui Xin Jieying Automobile Sales Co., Ltd (“Anhui Xin Jieying”, formerly known as Zhejiang Jieying Automobile Sales Co., Ltd and Shanghai Jieying Automobile Sales Co., Ltd), Shanghai Qianxiang Changda Internet Information Technology Development Co.,Ltd. (“Shanghai Changda”), Ningbo Jiusheng Automobile Sales and Services Co., Ltd. (“Ningbo Jiusheng”) and Qingdao Shengmei lianhe Import Automobile Sales Co., Ltd. (“Qingdao Shengmei”) and their subsidiaries, based on a series of contractual arrangements by and among Zhejiang Kaixin Auto. Co., Ltd. (“Zhejiang Kaixin”), Shanghai Renren Automotive Technology Group Co., Ltd. (“Shanghai Auto”), Zhejiang Taohaoche Technology Co., Ltd. (“Zhejiang Taohaoche”, formerly known as Ningbo Taohaoche Technology Co., Ltd.), the Company’s VIEs and their nominee shareholders. The contractual arrangements include Shareholders’ Voting Rights Proxy Agreements, Executive Call Option Agreements, Equity Pledge Agreements and Exclusive Business Cooperation Agreements.

With the disposition of Renren Finance Inc, all VIEs were disposed as of October 27, 2022 (“closing date”) (see Note 4).

COVID -19 Risks and Uncertainties

With the China’s nationwide loosening of COVID-19 policy since December 2022, management is currently evaluating the impact of the COVID-19 pandemic and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position and results of its operations, the specific impact is not readily determinable as of the date of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

ORGANIZATION AND PRINCIPAL ACTIVITIES (Tables)

12 Months Ended

Dec. 31, 2022

ORGANIZATION AND PRINCIPAL ACTIVITIES

Summary of major subsidiaries

The major subsidiaries of the Company as of December 31, 2022 are summarized as below:


	Later of date of
	incorporation or	Place of	% of
Name of Subsidiaries	acquisition	Incorporation	Ownership		Principal activities
Major subsidiaries:
Kaixin Auto Group (“KAG”)	January 25, 2018	Cayman Islands	100	%	Investment holding
Jet Sound Hong Kong Company Limited	May 7, 2011	Hong Kong	100	%	Investment holding
Zhejiang Taohaoche Technology Co., Ltd.	July 11, 2019	PRC	100	%	New car trading business
Zhejiang Kaixin Auto Co., Ltd	April 4, 2021	PRC	100	%	Used car trading business
Chongqing Jieying Shangyue Automobile Sales Co., Ltd.	July 3, 2017	PRC	100	%	Used car trading business
Wuhan Jieying Chimei Automobile Sales Co., Ltd.	November 20, 2017	PRC	100	%	Used car trading business
Anhui Kaixin New Energy Vehicle Co., Ltd.	January 25, 2022	PRC	100	%	New energy vehicle trading business

PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2022

Dec. 31, 2021

PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepayment for vehicle purchase

$ 18,252

$ 32,091

Other receivables from dealerships

9,546

19,249

Deductible input VAT

545

Advance to suppliers

Others

^[1]

191

1,362

Total

27,996

53,270

Less: valuation allowance

(1,675)

Prepaid expenses and other current assets

26,321

53,270

Impairment loss

$ (22,921)

$ 0

[1]	Others mainly included prepaid rent, staff advances, prepaid marketing fee, advertising fee, professional fee, and other receivables incurred for daily operations.

BANK BORROWING

12 Months Ended

Dec. 31, 2022

BANK BORROWING

BANK BORROWING

14.BANK BORROWING


	As of December 31,
	2021		2022
Short-term debt:
East West Bank ⁽¹⁾	$	6,277	$	2,000

Long-term debt:
East West Bank ⁽²⁾	$	2,000	$	—

(1)

The annum interest rate of borrowings from East West Bank was 6%. As of December 31, 2021, the Group’s short-term debt was with one-year maturity date.

The loan with amount of $6,277 was guaranteed by a wholly-owned subsidiary of Renren Inc, Qianxiang Shiji Technology Development (Beijing) Co., Ltd., a related party of the Group, covered by irrevocable standby letter of credit issued by East West Bank to Renren with Renren’s restricted cash pledged as security.

During the transaction of disposal of subsidiaries, the principal of the bank loan has been transferred to and assumed by the Buyer, and the interest will be paid by the Company on a monthly basis.

(2)

The annum interest rate of borrowings from East West Bank was 2.8%. The Group’s long-term debt matures on August 31, 2023 and was reclassed to current liability as of December 31, 2022. The loan was under an irrevocable standby letter of credit issued by East West Bank to Renren in April 2019 with Renren’s restricted cash pledged as security.

Interest expenses were $1, $223 and $1,034 recorded for bank loans in the consolidated statements of operations and comprehensive income (loss) for the years ended December 31, 2020, 2021 and 2022.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2022

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)Basis of presentation

The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”).

(b)Principles of consolidation

(c)Non-controlling interests

(d)Business combinations

Business combinations are recorded using the acquisition method of accounting. The Group uses a screen to evaluate whether a transaction should be accounted for as an acquisition and/or disposal of a business versus assets. In order for a purchase to be considered an acquisition of a business, and receive business combination accounting treatment, the set of transferred assets and activities must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. If substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, then the set of transferred assets and activities is not a business.

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(e)Use of estimates

(f)

Fair value measurement

●

Level 1 — inputs are based upon unadjusted quoted prices for identical assets or liabilities traded in active markets.

●

(g)

Warrants

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(h)

Cash and cash equivalents

(i)

Prepayment for vehicle purchase and other assets

(j)

Inventory

(k)

Convertible notes

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(l)

Property and equipment, net

		Estimated Useful Life
Computer equipment and application software		2 - 3 Years
Furniture and vehicles		5 Years

(m)

Intangible assets, net


		Estimated Useful Life
Software		10 Years
Domain name		10 Years
Trademark		10 Years

(n)

Goodwill

Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations.

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(o)

Impairment of long-lived assets

(p) Operating lease right-of -use assets

The Group leases premises for offices under non-cancellable operating leases.

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(q)

Value added tax

The Group reports revenue net of PRC’s VAT for all the periods presented in the consolidated statements of operations.

(r)

Revenue recognition

Step 1: Identify the contract with the customer

Step 2: Identify the performance obligations in the contract

Step 3: Determine the transaction price

Step 4: Allocate the transaction price to the performance obligations in the contract

Step 5: Recognize revenue when the Group satisfies a performance obligation

The following table identifies the disaggregation of the revenue for the years ended December 31, 2020, 2021 and 2022, respectively:


	For the year ended December 31,
	2020		2021		2022
Used-car sales	$	—	$	251,054	$	80,034
New-car wholesales		1,207		2,786		2,806
Total revenues	$	1,207	$	253,840	$	82,840

Advances from customers

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(s)

Cost of revenue

Cost of revenue consists primarily of cost of goods purchased from domestic and overseas regions.

(t)

Income taxes

(u)

Foreign currency translation

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(v)

Share-based compensation

(w)

Loss per share

(x)

Comprehensive income (loss)

(y)

Commitments and contingencies

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(z)

Concentration of credit risk

(aa)

Segment reporting

(bb)

Recently Adopted Accounting Standards

2.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES-CONTINUED

(dd)

Recent Accounting Standards

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and equipment net, Goodwill and Intangible assets, net (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2022	Dec. 31, 2021
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Impairment expense		$ 143,655
Software
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Estimated useful life of Intangible assets	10 years
Domain name
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Estimated useful life of Intangible assets	10 years
Trademark
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Estimated useful life of Intangible assets	10 years
Computer equipment and application software \| Minimum
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Estimated useful lives	2 years
Computer equipment and application software \| Maximum
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Estimated useful lives	3 years
Furniture and vehicles
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Estimated useful lives	5 years

FAIR VALUE MEASUREMENTS (Tables)

12 Months Ended

Dec. 31, 2022

FAIR VALUE MEASUREMENTS

Schedule of fair value hierarchy for assets and liabilities measured at fair value

As of December 31, 2021

As of December 31, 2022

Fair Value Measurement at the Reporting Date using

Quoted

price in

active

markets

for

Significant

for

Significant

identical

other

unobservable

identical

other

unobservable

assets

observable

inputs

assets

observable

inputs

Level 1

inputs

Level 3

Total

Level 1

inputs

Level 3

Total

Warrant liabilities

—

(340)

—

(24)

PAYABLE FOR SALES INCENTIVE

12 Months Ended

Dec. 31, 2022

PAYABLE FOR SALES INCENTIVE

PAYABLE FOR SALES INCENTIVE

11.PAYABLE FOR SALES INCENTIVE

In 2022, the Company entered into a share grant agreement with dealership operators. In order to encourage the dealership operators to improve their sales performance, the Company agreed to provide sales incentives to the dealership operators based on their sales performance. As sales incentive, the Company will issue a total of 5,585,645 shares to dealership operators according to the sales performance for February 2022 to December 2022. The Company recognized these shares as selling expenses of $1,638 based on fair value of the Shares as of December 31, 2022 by reference to share-based payment transactions and the payable for sales incentive of $1,638 recognized as of December 31, 2022.

OTHER RECEIVABLES (Tables)

12 Months Ended

Dec. 31, 2022

OTHER RECEIVABLES.

Schedule of other receivables


Borrower	Interest rate		Amount
Shanghai Changda	0	%	$	6,858
Anhui Xin Jieying	0	%	$	1,990
Total			$	8,848

OTHER NON-CURRENT ASSETS, NET - Additional Information (Details) $ in Thousands	Dec. 31, 2021 USD ($)
OTHER NON-CURRENT ASSETS, NET
Impairment	$ 4,216

EQUITY

12 Months Ended

Dec. 31, 2022

EQUITY

EQUITY

18.EQUITY

Ordinary shares

KAH issued 74,035,502 ordinary shares to the former shareholders of Haitaoche in the Reverse Acquisition. The shareholders’ structure as of December 31, 2021 reflects the equity structure of the KAH, including the equity interests KAH issued to effect the reverse acquisition. The shareholders’ equity structures as of December 31, 2020 were presented after giving retroactive effect to the reverse acquisition of the Group that was completed on June 25, 2021. The comparative share capital amounts as of December 31, 2020 have been retroactively adjusted to reflect the legal capital of KAH.

Preferred shares

Series D Preferred Shares

On March 31, 2021, KAH entered into a definitive securities purchase agreement with Renren Inc. (the “Holder”) and completed the closing on the same date.

Pursuant to the agreement, the Holder will invest $6,000 in newly designated Series D convertible preferred shares (the “Series D Preferred Shares”) of KAH. Major terms of the Series D Preferred Shares are as follows:

Conversion Rights: Series D preferred shares are convertible into 2,000,000 ordinary shares of KAH’s at a conversion price of $3.00, subject to customary adjustments. Each Preferred Share shall be convertible, at any time and from time to time from and after the applicable Issuance Date (April 8, 2021) at the option of the Holder into that number of ordinary shares.

Redemption Rights: the redemption included optional redemption and redemption on triggering events. With respect to optional redemption, KAH may deliver a notice to the Holders of its irrevocable election to redeem some or all of the then outstanding Series D Preferred Shares at any time after March 30, 2022. With respect to redemption on several triggering events, upon the occurrence of a Triggering Event, each Holder shall have the right, exercisable at the sole option of such Holder, to require the Company to redeem all of the Series D Preferred Shares.

The Series D Preferred Shares were considered as permanent equity since they were redeemable upon the occurrence of events that are within the Group’s control. The Group has issued 6,000 convertible preferred shares and received $6,000 as of April 8, 2021.

18.EQUITY-CONTINUED

Series F Preferred Shares

On December 28, 2022, KAG entered into a definitive securities purchase agreement with Stanley Star Group Inc. (the “Holder”) and completed the closing on the same date. On March 24, 2023, KAG and Stanley Star entered into an amendment to the supplement agreement that modified specific terms of the $50 million preferred stock issued by the Company to Stanley Star. The Company issued $50,000,000 convertible preferred shares of the Company to Stanley Star as part of consideration of the divestment of the Disposal group (Note 4). Major terms of the Series F Preferred Shares are as follows:

Conversion Rights: Series F preferred shares are convertible into 50,000,000 ordinary shares of the Company at a conversion price of $1.00, subject to customary adjustments. Each Preferred Share shall be convertible, at any time and from time to time from and after the applicable Issuance Date at the option of the Holder into that number of ordinary shares.

Redemption Rights: the redemption included optional redemption and redemption on triggering events. With respect to optional redemption, the Company may deliver a notice to the Holders of its irrevocable election to redeem some or all of the then outstanding Series F Preferred Shares at any time after January 1, 2023. With respect to redemption on several triggering events, upon the occurrence of a Triggering Event, each Holder shall have the right, exercisable at the sole option of such Holder, to require the Company to redeem all of the Series F Preferred Shares.

The Series F Preferred Shares were considered as permanent equity since they were redeemable upon the occurrence of events that are within the Group’s control.

Warrants

Issuance of ordinary shares and 2022 warrants

In January 2022, Suzhou government and its partners determined to invest RMB100 million (approximately $15.4 million) to subscribe for ordinary shares of the Company to support the electronic vehicles business and the first payment of RMB 30 million (approximately $4.6 million) of investment had been received in February 2022. In connection, on March 14, 2022, the Company issued 4,406,542 ordinary shares to Derong Group Limited (“Derong”), the entity designed by Suzhou government. The Company also committed and issued 6,500,000 warrant shares (“2022 Warrant) to Discover Flux Ltd, a warrant holder designated by Derong on July 3, 2022. Discover Flux Ltd has right to subscribe for the Company’s ordinary shares at an exercise price of $1.00 per share. The warrant shares were classified as equity and measured at relative fair value of $1,417 calculated using the Black-Scholes pricing model, which was recorded as warrant equity started from July 3, 2022. The portion of the proceeds of $3,298 was allocated to the issued ordinary shares.

The Company paid issuance cost of amount $1,575 associated with the RMB 100 million investment after the first payment of RMB 30 million was received. $472 of the issuance cost was allocated to the warrant shares and ordinary shares based on assessed fair value of warrant shares and residual proceeds allocated to the ordinary shares, compared to total proceeds received. Issuance costs associated with warrant and ordinary shares were an offset to additional paid-in capital. The $1,103 of the issuance cost was presented as general and administrative expenses in the balance sheet statement as of December 31, 2022 due to the uncertainty of the remaining investment of RMB 70 million.

18.EQUITY-CONTINUED

The fair value of the warrants as of July 3, 2022 were calculated using the Black-Scholes pricing model with the following assumptions:


	As of July 3, 2022
	2022 Warrant
Risk-free rate of return		2.60	%
Estimated volatility rate		57.21	%
Dividend yield		0	%
Spot price of underling ordinary share		1.035
Exercise price	$	1
Fair value of warrant	$	2,027

2019 warrants

As of December 31, 2022, there were 11,957,008 warrants outstanding, which was issued by KAH and consist of 10,318,145 warrants which were issued with units in the initial public offering (“IPO”) of KAH in 2017, 1,000,000 warrants issued with units upon the conversion of convertible loan of Kunlun Tech Limited, 263,863 warrants issued to Shareholder Value Fund and 375,000 warrants issued with units for share subscription of E&A Callet Investment Limited (collective the “2019 Warrants”).

Each whole warrant that was issued with units in the IPO and issued with units to the 2019 Warrants is exercisable for one ordinary share at a price of $11.50 per full share. The warrants may only be exercised for whole numbers of shares. The 2019 Warrants became exercisable on April 30, 2019 and have a term of five years from April 30, 2019.

The Group may redeem the outstanding 2019 Warrants, in whole and not in part, at a price of $0.01 per warrant:

●

at any time while the 2019 Warrants are exercisable,

●

upon a minimum of 30 days’ 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 Group 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 2019 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 Group calls the 2019 Warrants for redemption as described above, the management will have the option to require all holders that wish to exercise warrants to do so on a “cashless basis.”

The 2019 Warrants were recognized as an equity instrument as it meets all of the criteria for equity classification and is classified within equity as additional paid-in capital.

18.EQUITY-CONTINUED

Options

There was a call option purchased by the IPO underwriter of KAH in 2017, which is exercisable at $10.00 per Unit to purchase up to 900,000 Units (or an aggregate exercise price of $9,000,000). The option may be exercised for cash or on a cashless basis, at the holder’s option, and expires five years from the effective date of the registration statement related to the initial public offering of KAH (i.e., expires by October 2022).

Statutory reserve and restricted net assets

In accordance with the Regulations on Enterprises with Foreign Investment of China and their articles of association, the Group’s subsidiaries and VIE entities located in the PRC, are required to provide for certain statutory reserves. The statutory reserve fund required to reserve 10% of their net profit after income tax, as determined in accordance with the PRC accounting rules and regulations. Appropriation to the statutory reserve by the Group is based on profit arrived at under PRC accounting standards for business enterprises for each year. The profit arrived at must be set off against any accumulated losses sustained by the Group in prior years, before allocation is made to the statutory reserve. Appropriation to the statutory reserve must be made before distribution of dividends to shareholders. The appropriation is required until the statutory reserve reaches 50% of the registered capital. This statutory reserve is not distributable in the form of cash dividends.

Relevant PRC statutory laws and regulations permit the payment of dividends by the Group’s PRC subsidiary only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Furthermore, registered share capital and capital reserve accounts are also restricted from distribution. As a result of these PRC laws and regulations, the Group’s PRC subsidiary is restricted in their ability to transfer a portion of their net assets to the Group either in the form of dividends, loans or advances. The Group’s restricted net assets, comprising of paid-in-capital and statutory reserve of Group’s PRC subsidiary, were $117,085 and $121,656 as of December 31, 2021 and December 31, 2022, respectively.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 13
-Subparagraph (b)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
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-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496189-112644

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=123467817&loc=SL123496158-112644

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

BANK BORROWING (Tables)

12 Months Ended

Dec. 31, 2022

BANK BORROWING

Schedule of bank borrowing


	As of December 31,
	2021		2022
Short-term debt:
East West Bank ⁽¹⁾	$	6,277	$	2,000

Long-term debt:
East West Bank ⁽²⁾	$	2,000	$	—

(1)

The annum interest rate of borrowings from East West Bank was 6%. As of December 31, 2021, the Group’s short-term debt was with one-year maturity date.

During the transaction of disposal of subsidiaries, the principal of the bank loan has been transferred to and assumed by the Buyer, and the interest will be paid by the Company on a monthly basis.

(2)