Item 8.01 Other Events

On January 16, 2020, a lawsuit was filed against the Company and Shanghai Hongfu, one of HQDA's subsidiaries, by Shanghai Qiao Hong Real Estate, Ltd and its subsidiaries (the "Plaintiff") for breach of contract and non-payment of an installment pursuant to an Asset Purchase Agreement entered into between the Company and the Plaintiff on April 2, 2019. The Plaintiff is alleging damages of RMB 76,638,000 (approximately $11,106,956). The lawsuit was filed in a District Court in Shanghai, China. The Company intends to vigorously defend this action. The lawsuit is in its preliminary stages and as of this date there has been no discovery initiated.

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