Item 8.01. Other Events
.
As previously disclosed
in the Original Filing, the Company and Mr. Huang, one of CUIS’s former employees, agreed to settle fraud charges brought
by the SEC relating to a scheme to manipulate the Company's trading volume. Neither the Company nor Mr. Huang realized financial
gain from the scheme and both CUIS and Mr. Huang substantially cooperated with the SEC’s investigation into the activities
that led the SEC to bring the fraud charges.
The SEC’s
complaint (the “SEC’s Complaint”) alleged that, from approximately December 2013 through March 2018, the Company
and Mr. Huang schemed to deceive the investing public and Nasdaq, for the purpose of obtaining a listing on Nasdaq, that the trading
volume in the Company's common stock was derived from bona fide market activity. Mr. Huang, acting on the Company's behalf, used
multiple brokerage accounts to engage in numerous transactions in the Company's common stock. When Mr. Huang's trading was flagged
by a U.S.-based brokerage firm for high volume and possible prearranged trading and several of the accounts were frozen, Mr. Huang
and two colleagues contacted the brokerage firm and made false statements about their identities, their relation to the Company
and their reasons for trading.
The SEC's
Complaint alleged that the Company and Mr. Huang violated the antifraud provisions of Section 17(a) of the U.S. Securities Act
of 1933, as amended, and Section 10(b) of the Securities and Exchange Act of 1934, as amended, and Rule 10b-5 thereunder. Without
admitting or denying the allegations in the complaint, both CUIS and Mr. Huang agreed to the entry of a final judgment (the “Final
Judgment”) that enjoins them from violating the charged provisions of the federal securities laws, orders the Company to
comply with its undertaking to retain an independent compliance monitor for a period of not less than one year, and orders Mr.
Huang to pay a penalty of $30,000. Based upon the Company's substantial cooperation with the SEC’s investigation, the SEC
did not seek a monetary penalty against the Company.
On January
18, 2019, the Final Judgment was entered by the District Court.
The SEC’s
Complaint, the Final Judgment, the Company’s Consent and Mr. Huang’s Consent are attached hereto as Exhibits 99.1,
99.2, 99.3 and 99.4, respectively, and are incorporated by reference into this Amended Report.
Caution Regarding Forward-Looking
Statements
This Amended Report includes
information that constitutes forward-looking statements. Such forward-looking statements often contain words such as “believe,”
“expect,” “anticipate,” “intend,” or “will,” although not all forward-looking
statements contain these identifying words. By their nature, forward-looking statements address matters that are subject to risks
and uncertainties. Examples of such forward-looking statements include, but are not limited to, statements of our expectations
regarding the matters described above.
These forward-looking statements
are based on our current beliefs, assumptions and expectations concerning future events, which, in turn, are based on information
currently available to the Company. Such forward-looking statements include actions taken by the Company, the SEC or the District
Court with respect to the matters covered by this Amended Report . Although we believe that the expectations underlying any of
these forward-looking statements are reasonable, these expectations may prove to be incorrect and all of these statements are
subject to risks and uncertainties. A variety of factors could cause actual events or results to differ materially from those
expressed or contemplated by the forward-looking statements including, without limitation, additional information that may become
known to the Company in connection with the matters that are the subject of this Amended Report or that subsequent events may
occur that require the Company to take additional action with respect thereto.
All forward-looking statements included in this Amended
Report are expressly qualified in their entirety by these cautionary statements and the Company undertakes no obligation to publicly
update or revise any forward-looking statement except to the extent required by applicable securities laws.