Cover
Cover - shares | 9 Months Ended | |
Feb. 28, 2023 | Apr. 19, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Feb. 28, 2023 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2023 | |
Current Fiscal Year End Date | --05-31 | |
Entity File Number | 000-50612 | |
Entity Registrant Name | UNIQUE LOGISTICS INTERNATIONAL, INC. | |
Entity Central Index Key | 0001281845 | |
Entity Tax Identification Number | 01-0721929 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 154-09 146th Ave | |
Entity Address, City or Town | Jamaica | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 11434 | |
City Area Code | 678 | |
Local Phone Number | 365-6004 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 799,141,770 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Feb. 28, 2023 | May 31, 2022 |
Current Assets: | ||
Cash and cash equivalents | $ 14,402,666 | $ 1,422,393 |
Accounts receivable, net | 40,438,290 | 74,746,036 |
Contract assets | 3,859,562 | 30,970,581 |
Other current assets and prepaids | 3,769,572 | 1,404,021 |
Total current assets | 62,470,090 | 108,543,031 |
Property and equipment, net | 1,691,248 | 188,889 |
Other long-term assets: | ||
Goodwill | 8,449,454 | 4,463,129 |
Identifiable intangible assets, net | 13,322,344 | 7,337,704 |
Equity-method investments | 10,861,111 | |
Operating lease right-of-use assets, net | 10,931,331 | 2,408,098 |
Deferred tax asset, net | 1,193,610 | 942,748 |
Other noncurrent assets | 2,021,926 | 1,028,336 |
Total other long-term assets | 46,779,776 | 16,180,015 |
Total assets | 110,941,114 | 124,911,935 |
Current Liabilities: | ||
Accounts payable | 17,462,662 | 49,028,862 |
Accrued expenses and current liabilities | 10,178,857 | 5,666,159 |
Accrued freight | 8,056,941 | 9,240,650 |
Contract Liabilities | 358,365 | 468,209 |
Revolving credit facility | 9,882,529 | 38,141,451 |
Current portion of notes payable | 17,804,500 | 608,333 |
Current portion of noncurrent debt due to related parties | 325,478 | 301,308 |
Current portion of operating lease liability | 2,422,306 | 912,618 |
Other current liabilities | 5,710,057 | |
Total current liabilities | 72,201,695 | 104,367,590 |
Noncurrent liabilities: | ||
Noncurrent portion of notes payable | 1,500,000 | |
Noncurrent debt due to related parties, net of current portion | 150,655 | 397,968 |
Derivative liabilities | 11,628,383 | 12,437,994 |
Operating lease liability, net of current portion | 8,813,569 | 1,593,873 |
Other noncurrent liabilities | 282,666 | |
Total noncurrent liabilities | 22,092,607 | 14,712,501 |
Total liabilities | 94,294,302 | 119,080,091 |
Commitments and contingencies | ||
Stockholders’ Equity: | ||
Common stock $0.001 par value; 800,000,000 shares authorized, 799,141,770 and 687,196,478 common shares issued and outstanding as of February 28, 2023, and May 31, 2022, respectively. | 799,143 | 687,197 |
Additional paid-in capital | 180,220 | 292,155 |
Retained earnings | 12,107,752 | 4,851,541 |
Total Stockholders’ equity attributable to registrant | 13,088,055 | 5,831,844 |
Equity attributable to noncontrolling interests | 3,558,757 | |
Total Stockholder’s Equity | 16,646,812 | 5,831,844 |
Total Liabilities and Stockholders’ Equity | 110,941,114 | 124,911,935 |
Series A Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock, value | 120 | 130 |
Series B Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock, value | 821 | 821 |
Series C Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock, value | ||
Series D Preferred Stock [Member] | ||
Stockholders’ Equity: | ||
Preferred stock, value |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Feb. 28, 2023 | May 31, 2022 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 800,000,000 | 800,000,000 |
Common stock, shares outstanding | 799,141,770 | 687,196,478 |
Common stock, shares issued | 799,141,770 | 687,196,478 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 120,065 | 130,000 |
Preferred stock, shares outstanding | 120,065 | 130,000 |
Liquidation preference | $ 120 | |
Series B Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 820,800 | 820,800 |
Preferred stock, shares outstanding | 820,800 | 820,800 |
Liquidation preference | $ 821 | |
Series C Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 195 | 195 |
Preferred stock, shares outstanding | 195 | 195 |
Liquidation preference | $ 18.5 | |
Series D Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares issued | 180 | 187 |
Preferred stock, shares outstanding | 180 | 187 |
Liquidation preference | $ 17.3 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operation (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | |
Revenues: | ||||
Total revenues | $ 49,627,502 | $ 250,435,895 | $ 274,973,607 | $ 845,638,444 |
Costs and operating expenses: | ||||
Airfreight services | 11,964,314 | 127,220,095 | 59,465,104 | 447,865,096 |
Ocean freight and ocean services | 19,722,259 | 99,620,036 | 142,806,034 | 323,381,733 |
Contract logistics | 215,245 | 459,492 | 846,226 | 1,529,318 |
Customs brokerage and other services | 11,397,398 | 16,011,938 | 44,773,324 | 41,330,633 |
Salaries and related costs | 3,076,221 | 2,551,481 | 10,036,200 | 8,120,799 |
Professional fees | 39,082 | 190,765 | 1,213,807 | 669,091 |
Rent and occupancy | 883,681 | 508,621 | 2,026,363 | 1,478,600 |
Selling and promotion | 1,471,236 | 899,097 | 2,033,668 | 4,591,715 |
Depreciation and amortization | 203,390 | 196,347 | 606,030 | 585,019 |
Other | 323,747 | 524,933 | 993,508 | 1,975,000 |
Total costs and operating expenses | 49,296,573 | 248,182,805 | 264,800,264 | 831,527,004 |
Income from operations | 330,929 | 2,253,090 | 10,173,343 | 14,111,440 |
Other income (expenses) | ||||
Interest expense | (546,791) | (1,395,396) | (2,876,776) | (4,566,876) |
Amortization of debt discount | (776,515) | |||
Loss on extinguishment of convertible notes payable | (1,344,087) | (564,037) | ||
Gain on forgiveness of promissory note | 358,236 | |||
Change in fair value of derivative liabilities | 64,955 | (4,275,986) | 809,611 | (4,275,986) |
Other Income | 60,000 | 60,000 | ||
Total other income (expenses) | (481,836) | (6,955,469) | (2,067,165) | (9,765,178) |
Net income (loss) before income taxes | (150,907) | (4,702,379) | 8,106,178 | 4,346,262 |
Income tax (credit) expense | (814,080) | 228,207 | 849,967 | 2,765,207 |
Net income (loss) | 663,173 | (4,930,586) | 7,256,211 | 1,581,055 |
Deemed Dividend | (4,565,725) | (4,565,725) | ||
Net income (loss) available to common shareholders | $ 663,173 | $ (9,496,311) | $ 7,256,211 | $ (2,984,670) |
Net income per common share | ||||
– basic | $ (0.01) | $ 0.01 | $ (0.01) | |
– diluted | $ (0.01) | $ (0.01) | ||
Weighted average common shares outstanding | ||||
– basic | 799,141,770 | 655,781,078 | 780,768,778 | 582,680,746 |
– diluted | 9,677,967,424 | 655,781,078 | 9,659,594,432 | 582,680,746 |
Airfreight Services [Member] | ||||
Revenues: | ||||
Total revenues | $ 13,206,112 | $ 127,787,167 | $ 64,721,816 | $ 455,020,012 |
Ocean Freight And Ocean Services [Member] | ||||
Revenues: | ||||
Total revenues | 23,106,949 | 104,379,472 | 159,292,026 | 343,102,200 |
Contract Logistics [Member] | ||||
Revenues: | ||||
Total revenues | 755,034 | 725,932 | 2,499,459 | 2,659,652 |
Customs Brokerage And Other Services [Member] | ||||
Revenues: | ||||
Total revenues | $ 12,559,407 | $ 17,543,324 | $ 48,460,306 | $ 44,856,580 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Stockholders' Equity (Unaudited) - USD ($) | Preferred Stock [Member] Series A Preferred Stock [Member] | Preferred Stock [Member] Series B Preferred Stock [Member] | Preferred Stock [Member] Series C Preferred Stock [Member] | Preferred Stock [Member] Series D Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Parent [Member] | Noncontrolling Interest [Member] | [1] | Total |
Beginning balance, shares at May. 31, 2021 | 130,000 | 840,000 | 393,742,663 | ||||||||
Beginning balance at May. 31, 2021 | $ 130 | $ 840 | $ 393,743 | $ 4,906,384 | $ 1,316,987 | $ 6,618,084 | |||||
Net income | 2,023,416 | 2,023,416 | |||||||||
Conversion of Preferred B to Common Stock | $ (19) | $ 125,692 | (125,673) | ||||||||
Conversion of Preferred A to Common Stock, shares | (19,200) | 125,692,224 | |||||||||
Issuance of Common Stock for the conversion of notes and accrued interest | $ 83,812 | 66,746 | 150,558 | ||||||||
Issuance of Common Stock for the conversion of notes and accrued interest, shares | 83,811,872 | ||||||||||
Ending balance, shares at Aug. 31, 2021 | 130,000 | 820,800 | 603,246,759 | ||||||||
Ending balance at Aug. 31, 2021 | $ 130 | $ 821 | $ 603,247 | 4,847,457 | 3,340,403 | 8,792,058 | |||||
Beginning balance, shares at May. 31, 2021 | 130,000 | 840,000 | 393,742,663 | ||||||||
Beginning balance at May. 31, 2021 | $ 130 | $ 840 | $ 393,743 | 4,906,384 | 1,316,987 | 6,618,084 | |||||
Net income | 1,581,055 | ||||||||||
Ending balance, shares at Feb. 28, 2022 | 130,000 | 820,800 | 195 | 192 | 655,781,078 | ||||||
Ending balance at Feb. 28, 2022 | $ 130 | $ 821 | $ 655,782 | 323,570 | 2,898,042 | 3,878,345 | |||||
Beginning balance, shares at Aug. 31, 2021 | 130,000 | 820,800 | 603,246,759 | ||||||||
Beginning balance at Aug. 31, 2021 | $ 130 | $ 821 | $ 603,247 | 4,847,457 | 3,340,403 | 8,792,058 | |||||
Net income | 4,488,225 | 4,488,225 | |||||||||
Issuance of Common Stock for the conversion of notes and accrued interest | $ 52,534 | 41,838 | 94,372 | ||||||||
Issuance of Common Stock for the conversion of notes and accrued interest, shares | 52,534,319 | ||||||||||
Ending balance, shares at Nov. 30, 2021 | 130,000 | 820,800 | 655,781,078 | ||||||||
Ending balance at Nov. 30, 2021 | $ 130 | $ 821 | $ 655,782 | 4,889,295 | 7,828,628 | 13,374,656 | |||||
Net income | (4,930,586) | (4,930,586) | |||||||||
Conversion of debt to preferred C and D | |||||||||||
Conversion of debt to preferred C and D, shares | 195 | 192 | |||||||||
Deemed dividend | (4,565,725) | (4,565,725) | |||||||||
Ending balance, shares at Feb. 28, 2022 | 130,000 | 820,800 | 195 | 192 | 655,781,078 | ||||||
Ending balance at Feb. 28, 2022 | $ 130 | $ 821 | $ 655,782 | 323,570 | 2,898,042 | 3,878,345 | |||||
Beginning balance, value at May. 31, 2022 | $ 130 | $ 821 | $ 687,197 | 292,155 | 4,851,541 | $ 5,831,844 | 5,831,844 | ||||
Beginning balance, shares at May. 31, 2022 | 130,000 | 820,800 | 195 | 187 | 687,196,478 | ||||||
Beginning balance at May. 31, 2022 | 5,831,844 | ||||||||||
Conversion of Preferred A to Common Stock | $ (10) | $ 67,964 | (67,954) | ||||||||
Conversion of Preferred A to Common Stock, shares | (9,935) | 67,963,732 | |||||||||
Net income | 3,321,341 | 3,321,341 | 3,321,341 | ||||||||
Ending balance, value at Aug. 31, 2022 | $ 120 | $ 821 | $ 799,142 | 180,220 | 8,172,882 | 9,153,185 | 9,153,185 | ||||
Ending balance, shares at Aug. 31, 2022 | 120,065 | 820,800 | 195 | 180 | 799,141,770 | ||||||
Beginning balance, value at May. 31, 2022 | $ 130 | $ 821 | $ 687,197 | 292,155 | 4,851,541 | 5,831,844 | 5,831,844 | ||||
Beginning balance, shares at May. 31, 2022 | 130,000 | 820,800 | 195 | 187 | 687,196,478 | ||||||
Beginning balance at May. 31, 2022 | 5,831,844 | ||||||||||
Net income | 7,256,211 | ||||||||||
Ending balance, value at Feb. 28, 2023 | $ 120 | $ 821 | $ 799,142 | 180,220 | 12,107,752 | 13,088,055 | 3,558,757 | 16,646,812 | |||
Ending balance, shares at Feb. 28, 2023 | 120,065 | 820,800 | 195 | 180 | 799,141,770 | ||||||
Ending balance at Feb. 28, 2023 | 13,088,055 | ||||||||||
Beginning balance, value at Aug. 31, 2022 | $ 120 | $ 821 | $ 799,142 | 180,220 | 8,172,882 | 9,153,185 | 9,153,185 | ||||
Beginning balance, shares at Aug. 31, 2022 | 120,065 | 820,800 | 195 | 180 | 799,141,770 | ||||||
Net income | 3,271,697 | 3,271,697 | 3,271,697 | ||||||||
Ending balance, shares at Nov. 30, 2022 | 120,065 | 820,800 | 195 | 180 | 799,141,770 | ||||||
Ending balance at Nov. 30, 2022 | $ 120 | $ 821 | $ 799,142 | 180,220 | 11,444,579 | 12,424,882 | 12,424,882 | ||||
Net income | 663,173 | 663,173 | 663,173 | ||||||||
Recognition of non-controlling interest upon acquisition | 3,558,757 | 3,558,757 | |||||||||
Ending balance, value at Feb. 28, 2023 | $ 120 | $ 821 | $ 799,142 | $ 180,220 | $ 12,107,752 | $ 13,088,055 | $ 3,558,757 | 16,646,812 | |||
Ending balance, shares at Feb. 28, 2023 | 120,065 | 820,800 | 195 | 180 | 799,141,770 | ||||||
Ending balance at Feb. 28, 2023 | $ 13,088,055 | ||||||||||
[1]The net income(loss) attributable to the non-controlling interest for the period from the date of acquisition of February 21, 2023 to February 28, 2023 was not material. |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 7,256,211 | $ 1,581,055 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 606,030 | 585,019 |
Amortization of debt discount | 776,515 | |
Amortization of right of use assets | 1,269,299 | 1,103,649 |
Change in fair value of derivative liability | (809,611) | 4,275,986 |
Bad debt expense | 850,000 | |
Gain on forgiveness of note payable | (358,236) | |
Loss on extinguishment of convertible notes payable | 564,037 | |
Change in deferred tax asset | (261,118) | 99,000 |
Accretion of consulting agreement | (282,666) | (212,004) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 58,562,998 | (82,890,241) |
Contract assets | 27,111,019 | (12,706,657) |
Factoring reserve | 7,593,665 | |
Other prepaid expenses and current assets | (2,716,596) | 256,716 |
Deposits and other assets | (1,533,533) | (20,000) |
Accounts payable | (44,314,785) | 18,807,393 |
Accrued expenses and other current liabilities | (9,511,815) | 2,962,457 |
Accrued freight | (1,183,709) | 5,397,339 |
Contract liabilities | (109,844) | 10,403,335 |
Operating lease liability | (1,049,118) | (1,098,769) |
Net Cash Provided by (Used in) Operating Activities | 33,032,762 | (42,029,741) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of equipment | (94,900) | (54,474) |
Acquisitions of businesses, net of cash acquired | 8,828,309 | |
Net Cash Used in Investing Activities | 8,733,409 | (54,474) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Revolving credit facility, net | (28,258,922) | 43,888,787 |
Proceeds from notes payable | 2,000,000 | |
Repayments of notes payable | (303,833) | (2,821,664) |
Repayments of debt due to related parties | (223,143) | (239,924) |
Net Cash (Used in) Provided by Financing Activities | (28,785,898) | 42,827,199 |
Net change in cash and cash equivalents | 12,980,273 | 742,984 |
Cash and cash equivalents - Beginning of Period | 1,422,393 | 252,615 |
Cash and cash equivalents - End of Period | 14,402,666 | 995,598 |
Cash paid during the period for: | ||
Income taxes | 1,932,100 | 2,375,900 |
Interest | 2,571,748 | 4,072,366 |
Non-cash transactions: | ||
Right-of-use assets obtained in exchange for lease liabilities | 8,897,639 | 1,098,769 |
Non-cash consideration paid in business acquisition (Note 2) | 25,250,000 | |
Conversion of Series B Preferred to Common Stock | 125,673 | |
Issuance of common stock for the conversion of principal net of accrued interest capitalized to principal to Notes Payable | 244,931 | |
Reduction of debt due to exchange of convertible Notes for Preferred Stock Series C&D | $ 3,861,162 |
NATURE OF BUSINESS AND SUMMARY
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Feb. 28, 2023 | |
Accounting Policies [Abstract] | |
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 1. NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business Unique Logistics International, Inc. and its subsidiaries (the “Company” or “Unique”) is a global logistics and freight forwarding company. The Company provides a range of international logistics services that enable its customers to outsource sections of their supply chain process. This range of services can be categorized as follows: ● Air Freight ● Ocean Freight ● Customs Brokerage and Compliance ● Warehousing and Distribution ● Order Management Basis of Presentation These condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include all accounts of the Company and its subsidiaries stated in U.S. dollars, the Company’s functional currency. For subsidiaries operating outside the U.S., the financial information will be accounted for on a one-month lag. Substantially all unremitted earnings of international subsidiaries are free of legal and contractual restrictions. The unaudited interim financial information furnished herein reflects all adjustments, consisting solely of normal recurring items, which in the opinion of management are necessary to fairly state the financial position of the Company and the results of its operations for the periods presented. This report should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in the Company’s Form 10-K for the year ended May 31, 2022. The Company assumes that the users of the interim financial information herein have read or have access to the audited financial statements for the preceding fiscal year and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The condensed consolidated balance sheet on May 31, 2022 was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. Principles of Consolidation The consolidated financial statements of the Company include the accounts of the Company and its majority owned subsidiaries stated in U.S. dollars, the Company’s functional currency. All intercompany transactions and balances have been eliminated in the condensed consolidated financial statements. Acquisitions These condensed consolidated financial statements include the operations of acquired businesses from the date of the acquisitions. The decision of whether to consolidate an entity for financial reporting purposes requires consideration of majority voting interests, as well as effective economic or other control over the entity. We account for acquired businesses that we control using the acquisition method of accounting, which requires, among other things, that most assets acquired, and liabilities assumed be recognized at their estimated fair values as of the acquisition date. Transaction costs are expensed as incurred. Any excess of the consideration transferred over the assigned values of the net assets acquired is recorded as goodwill. Contingent consideration in a business combination is included as part of the contingent liability and is recognized at fair value as of the acquisition date. Fair value is generally estimated by using a probability-weighted discounted cash flow approach. Any liability resulting from contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved. These changes in fair value are recognized in earnings. For equity-method investments in share capital of the subsidiaries where share interest acquired is less than 50%, but we have significant influence over the financial and operating policies of the investee, we use the equity method of accounting. Under the equity-method, we record our share of the investee’s income and expenses in income from operation and any share of the earnings and loss would be recorded against investment reduced by cash dividends received. The initial excess of the cost of the investment over our share of the underlying equity in the net assets of the investee as of the acquisition date is allocated to the identifiable assets and liabilities of the investee, with any remaining excess amount allocated to goodwill. Such investments are initially recorded at cost, which is the fair value of consideration paid and typically does not include contingent consideration. For equity-method investments, an impairment charge is recorded only if and when a decline in fair value is determined to be other-than-temporary. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates. Significant estimates inherent in the preparation of the condensed consolidated financial statements include determinations of the useful lives and expected future cash flows of long-lived assets, including intangibles, valuation of assets and liabilities acquired in business combinations, and estimates and assumptions in valuation of debt and equity instruments, including derivative liabilities. In addition, the Company makes significant judgments to recognize revenue – see policy note “ Revenue Recognition Foreign Currency Translation For most of our international operations conducted by the subsidiaries operating outside the U.S, local currencies have been determined to be functional currencies. We translate functional currency assets and liabilities to their U.S. dollar equivalents at exchange rates in effect as of the balance sheet date and income and expense amounts at average exchange rates for the period. The U.S. dollar affects that arise from changing translation rates are recorded in Other comprehensive income/(loss). The effects of converting non-functional currency monetary assets and liabilities into the functional currency are recorded in Other (income)/deductions. Liquidity The accompanying condensed consolidated financial statements have been prepared on a going concern basis. Substantial doubt about an entity’s ability to continue as a going concern exists when conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued. As of February 28, 2023, the Company reported negative working capital of $ 9.7 4.2 3.5 23.8 1.5 3.8 6.5 10.9 The Company intends to either timely pay off the $ 23.8 10.0 Subsequent Events As previously reported, on December 18, 2022, the Company entered into an Agreement and Plan of Merger with Edify Acquisition Corp. and Edify Merger Sub, Inc. that, subject to various conditions, included a commitment from a lender for a senior secured financing facility in the maximum aggregate principal amount of $ 35.0 on March 10, 2023, the Company e as 4,210,526.32 14,789,473.68 9.0 Subsequent Events. In addition, the Company maintains its operating line of credit with TBK Bank, SSB, under which TBK Bank will, from time to time, buy approved receivables from the Company, which has a credit limit up to $ 47.5 While we continue to execute our strategic plan, growing the Company and its customer base, management is focused on managing cash and monitoring our liquidity position. We have implemented several initiatives to conserve our liquidity position, including activities such as increasing credit facilities, when needed, reducing the cost of debt by obtaining more favorable financing, controlling general and administrative expenditures and improving our collection processes. Many of the aspects of the liquidity plan involve management’s judgments and estimates that include factors that could be beyond our control and actual results could differ from our estimates. These and other factors could cause the strategic plan to be unsuccessful, which could have a material adverse effect on our operating results, financial condition, and liquidity. Negative operating capital may be an indicator that there could be a going concern issue, but based on our evaluation of the Company’s projected cash flows and business performance as of and subsequent to February 28, 2023, management has concluded that the Company’s current cash and cash availability under the TBK Facility as of February 28, 2023, would be sufficient to fund its planned operations for at least one year from the date the consolidated financial statements were issued. Fair Value Measurement The Company follows the authoritative guidance that establishes a formal framework for measuring fair values of assets and liabilities in the consolidated financial statements that are already required by generally accepted accounting principles to be measured at fair value. The guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The transaction is based on a hypothetical transaction in the principal or most advantageous market considered from the perspective of the market participant that holds the asset or owes the liability. The Company utilizes market data or assumptions that market participants who are independent, knowledgeable, and willing and able to transact would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable. The Company attempts to utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The Company is able to classify fair value balances based on the observability of those inputs. The guidance establishes a formal fair value hierarchy based on the inputs used to measure fair value. The hierarchy gives the highest priority to Level 1 measurements and the lowest priority to level 3 measurements, and accordingly, Level 1 measurement should be used whenever possible. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1 – Quoted prices in active markets for identical assets or liabilities or published net asset value for alternative investments with characteristics similar to a mutual fund. Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 – Unobservable inputs for the asset or liability. The methods used may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while management believes its valuation methods are appropriate, the fair value of certain financial instruments could result in a difference fair value measurement at the reporting date. There were no changes in the Company’s valuation methodologies from the prior year. For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amounts for financial assets and liabilities such as cash and cash equivalents, accounts receivable - trade, contract assets, factoring reserve, other prepaid expenses and current assets, accounts payable – trade and other current liabilities, including contract liabilities, convertible notes, promissory notes, all approximate fair value due to their short-term nature as of February 28, 2023, and May 31, 2022. The carrying amount of the long-term debt approximates fair value because the interest rates on these instruments approximate the interest rate on debt with similar terms available to the Company. Lease liabilities approximate fair value based on the incremental borrowing rate used to discount future cash flows. The Company had Level 3 liabilities (See Derivative liabilities note) as of February 28, 2023 and May 31, 2022. There were no transfers between levels during the reporting period. Accounts Receivable Accounts receivable from revenue transactions are based on invoiced prices which the Company expects to collect. In the normal course of business, the Company extends credit to customers that satisfy pre-defined credit criteria. The Company generally does not require collateral to support customer receivables. Accounts receivable, as shown on the consolidated balance sheets, is net of allowances when applicable. An allowance for doubtful accounts is determined through analysis of the aging of accounts receivable at the date of the consolidated financial statements, assessments of collectability based on an evaluation of historic and anticipated trends, the financial condition of the Company’s customers, and an evaluation of the impact of economic conditions. The maximum accounting loss from the credit risk associated with accounts receivable is the amount receivable recorded, net of allowance for doubtful accounts. As of February 28, 2023, and May 31, 2022 the Company recorded an allowance for doubtful accounts of approximately $ 1.7 2.7 Concentrations As of February 28, 2023, three major customers represented approximately 13.0 10.0 % of total accounts receivable. Revenue from these customers in the aggregate as a percentage of the Company’s total revenue was 18.0 % and 20.0 % for the three and nine months ended February 28, 2023, respectively, and no single customer represented more than 10.0 % of total revenue. As of May 31, 2022, three major customers represented approximately 21.0 10.0 50.0 52.0 39.0 38.0 10.0 Derivative Liability On December 10, 2021, the Company entered into an amended securities exchange agreement with the holders of convertible notes to exchange all Convertible Notes of the Company into shares of the Convertible Preferred Stock Series C and D. Similar to the Convertible Preferred Stock Series A, these preferred stocks featured anti-dilution provision that expire on a specified date. Management has determined the anti-dilution provision embedded in preferred stock Series A, C and D is required to be accounted for separately from the preferred stock as a derivative liability and recorded at fair value. Separation of the anti-dilution option as a derivative liability is required because its economic characteristics are considered more akin to an equity instrument and therefore the anti-dilution option is not considered to be clearly and closely related to the economic characteristics of the preferred stock. The Company has identified and recorded derivative instruments arising from an anti-dilution provision in the Company’s Series A, C and D Preferred Stock. An embedded derivative liability is representing the rights of holders of Convertible Preferred Stock Series A, C and D to receive additional common stock of the Company upon issuance of any additional common stock by the Company prior to qualified financing event as defined in the agreement. Each reporting period, the embedded derivative liability, if material, would be adjusted to reflect fair value at each period end with changes in fair value recorded in the “Change in fair value of embedded derivative liability” financial statement line item of the company’s statements of operations. During the nine months ended February 28, 2023, the Company recorded a change in fair value of $ 809,611 SCHEDULE OF DERIVATIVE LIABILITIES Level 1 Level 2 Level 3 Derivative liabilities as May 31, 2022 $ - $ - $ 12,437,994 Addition - - - Change in fair value - - (809,611 ) Derivative liabilities as February 28, 2023 $ - $ - $ 11,628,383 The underlying value of the anti-dilution provision is calculated from estimating the probability and value of the provision assuming a near term financing event. For the period ended May 31, 2022, the model used estimates the potential that the company completes a capital raise prior to the expiration of the anti-dilution feature and determines the value of the anti-dilution feature given these assumptions. The model required the use of certain assumptions. These assumptions include the probability of a raise is completed, probability certain anti-dilution features are extended, estimated raise amount, term to a raise, and an appropriate risk-free interest rate. For the period ended February 28, 2023, due to changes in the way antidilutive shares of Convertible Preferred Series A, C and D would be exchanged in the near future for common stock, and the fact that the antidilution provision of these shares was extended through December 31, 2023, the assumptions were changed to include probability of the financing event, estimated value of common stock at the exchange point and estimated time to financing event. The key inputs into the model were as follows: SCHEDULE OF FAIR VALUE ASSUMPTION February 28, 2023 May 31, 2022 Risk-free interest rate 5.0 % 1.60 % Probability of financing event or capital raise 90 % 50 % Estimated capital raise - 39.0 million Estimated value of common stock $ 10.00 per share - Estimated time to financing event 0.25 0.5 Revenue Recognition The Company adopted ASC 606, Revenue from Contracts with Customers To determine revenue recognition, the Company applies the following five steps: 1. Identify the contract(s) with a customer; 2. Identify the performance obligations in the contract; 3. Determine the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue as or when the performance obligation is satisfied. Revenue is recognized as follows: i. Freight income - export sales Freight income from the provision of air, ocean, and land freight forwarding services are recognized over time based on a relative transit time basis through the sail or departure from origin port. The Company is the principal in these transactions and recognizes revenue on a gross basis. ii. Freight income - import sales Freight income from the provision of air, ocean, and land freight forwarding services are recognized over time based on a relative transit time basis through the delivery to the customer’s designated location. The Company is the principal in these transactions and recognizes revenue on a gross basis. iii. Customs brokerage and other service income Customs brokerage and other service income from the provision of other services are recognized at the point in time the performance obligation is met. The Company’s business practices require, for accurate and meaningful disclosure, that it recognizes revenue over time. The “over time” policy is the period from point of origin to arrival of the shipment at the Port of entry (or in the case when the customer requires delivery to a designated point, the arrival at that delivery point). This overtime policy requires the Company to make significant judgements to recognize revenue over the estimated duration of time from port of origin to arrival at port of entry. The point in the process when the Company meets its obligation in the port of entry and the subsequent transfer of the goods to the customer is when the customer has the obligation to pay, has taken physical possession, has legal title, risk and awards (ownership) and has accepted the goods. The Company has elected to not disclose the aggregate amount of the transaction price allocated to performance obligations that are unsatisfied as of the end of the period as the Company’s contracts with its customers have an expected duration of one year or less. The Company uses independent contractors and third-party carriers in the performance of its transportation services. The Company evaluates who controls the transportation services to determine whether its performance obligation is to transfer services to the customer or to arrange for services to be provided by another party. The Company determined it acts as the principal for its transportation services performance obligation since it is in control of establishing the prices for the specified services, managing all aspects of the shipments process and assuming the risk of loss for delivery and collection. Revenue billed prior to realization is recorded as contract liabilities on the consolidated balance sheets and contract costs incurred prior to revenue recognition are recorded as contract assets on the consolidated balance sheets. Contract Assets Contract assets represent amounts for which the Company has the right to consider for the services provided while a shipment is still in-transit but for which it has not yet completed the performance obligation and has not yet invoiced the customer. Upon completion of the performance obligations, which can vary in duration based upon the method of transport and billing the customer, these amounts become classified within accounts receivable. Contract Liabilities Contract liabilities represent the amount of obligation to transfer goods or services to a customer for which consideration has been received. Significant Changes in Contract Asset and Contract Liability Balances for the nine months ended February 28,2023: SCHEDULE OF CHANGES IN CONTRACT ASSET AND CONTRACT LIABILITY Contract Contract Assets Liabilities Increase (Increase) (Decrease) Decrease Reclassification of the beginning contract liabilities to revenue, as the result of performance obligation satisfied $ - $ 468,209 Cash Received in advance and not recognized as revenue - (358,365 ) Reclassification of the beginning contract assets to receivables, as the result of rights to consideration becoming unconditional (39,978,761 ) - Contract assets recognized, net reclassification to receivables 12,867,742 - Net Change $ (27,111,019 ) $ 109,844 Disaggregation of Revenue from Contracts with Customers The following table disaggregates gross revenue from our clients by significant geographic area for the three and six months ended February 28, 2023, and 2022, based on origin of shipment (imports) or destination of shipment (exports): SCHEDULE OF DISAGGREGATION OF REVENUE For the Three For the Three Months Ended Months Ended February 28, 2023 February 28, 2022 China, Hong Kong & Taiwan $ 17,427,833 $ 82,006,657 Southeast Asia 9,335,793 121,340,162 United States 8,022,489 5,049,985 India Sub-continent 8,602,665 34,943,595 Other 6,238,722 7,095,496 Total revenue $ 49,627,502 $ 250,435,895 For the Nine For the Nine Months Ended Months Ended February 28, 2023 February 28, 2022 China, Hong Kong & Taiwan $ 123,977,602 $ 285,424,103 Southeast Asia 72,449,913 361,600,180 United States 29,699,664 28,254,253 India Sub-continent 37,919,338 134,393,170 Other 10,927,090 35,966,738 Total revenue $ 274,973,607 $ 845,638,444 Segment Reporting Based on the guidance provided by ASC Topic 280, Segment Reporting Earnings per Share The Company adopted ASC 260, Earnings per share, The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income attributable to common stockholders per common share. SCHEDULE OF EARNING PER SHARE February 28, 2023 February 28, 2022 For the Three Months Ended February 28, 2023 February 28, 2022 Numerator: Net income (loss) attributable to common stockholders $ 663,173 $ (9,496,311 ) Effect of dilutive securities: - - Diluted net income (loss) $ 663,173 $ (9,496,311 ) Denominator: Weighted average common shares outstanding – basic 799,141,770 655,781,078 Dilutive securities: Series A Preferred 1,168,177,320 - Series B Preferred 5,373,342,576 - Series C Preferred 1,206,351,359 - Series D Preferred 1,130,954,399 - Weighted average common shares outstanding and assumed conversion – diluted 9,677,967,424 655,781,078 Basic net income per common share $ 0.00 $ (0.01 ) Diluted net income per common share $ 0.00 $ (0.01 ) February 28, 2023 February 28, 2022 For the Nine Months Ended February 28, 2023 February 28, 2022 Numerator: Net income (loss) attributable to common stockholders $ 7,256,211 $ (2,984,670 ) Effect of dilutive securities: - - Diluted net income (loss) $ 7,256,211 $ (2,984,670 ) Denominator: Weighted average common shares outstanding – basic 780,768,778 582,680,746 Dilutive securities: Series A Preferred 1,168,177,320 - Series B Preferred 5,373,342,576 - Series C Preferred 1,206,351,359 - Series D Preferred 1,130,954,399 - Weighted average common shares outstanding and assumed conversion – diluted 9,659,594,432 582,680,746 Basic net income per common share $ 0.01 $ (0.01 ) Diluted net income per common share $ 0.00 $ (0.01 ) Leases The Company recognizes a right of use (“ROU”) asset and liability in the consolidated balance sheet primarily related to its operating leases of office space, warehouse space and equipment. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. All ROU assets and lease liabilities are recognized at the commencement date at the present value of lease payments over the lease term. ROU assets are adjusted for lease incentives and initial direct costs. The lease term includes renewal options exercised at the Company’s sole discretion when the Company is reasonably certain to exercise that option. As the Company’s leases generally do not have an implicit rate, the Company uses an estimated incremental borrowing rate based on borrowing rates available to them at the commencement date to determine the present value. Certain of our leases include variable payments, which may vary based upon changes in facts or circumstances after the start of the lease. The Company excludes variable payments from ROU assets and lease liabilities to the extent not considered fixed, and instead expenses variable payments as incurred. Lease expense is recognized on a straight-line basis over the lease term and is included in rent and occupancy expenses in the consolidated statements of operations. Reclassifications Certain prior year amounts have been reclassified for consistency with the current year presentation. |
ACQUISITIONS AND EQUITY METHOD
ACQUISITIONS AND EQUITY METHOD INVESTMENTS | 9 Months Ended |
Feb. 28, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS AND EQUITY METHOD INVESTMENTS | 2. ACQUISITIONS AND EQUITY METHOD INVESTMENTS On February 21, 2023, the Company completed the acquisition via a stock purchase agreement (“SPA”) signed on April 28, 2022, and applicable amendments by and between the Company and Unique Logistics Holdings Limited, a Hong Kong corporation (the “ULHL”), whereby the Company acquired all ULHL’s share capital in eight (8) of ULHL’s operating subsidiaries as follows: Schedule Of Acquired Subsidiary Name of acquired operating subsidiary Purchased Percentage Designation Unique Logistics International (H.K.) Limited 100 Consolidated subsidiary Unique Logistics International (Vietnam) Co., Ltd. 65 Consolidated subsidiary ULI (South China) Limited 70 Consolidated subsidiary Unique Logistics International (South China) Limited 70 Consolidated subsidiary Unique Logistics International (India) Private Ltd. 65 Consolidated subsidiary ULI (North & East China) Company Limited 50 Equity-method investment Unique Logistics International Co., Ltd 50 Equity-method investment TGF Unique Limited 49.99 Equity-method investment Purchase Price The total fair value of the consideration transferred was $ 28.8 15.5 SCHEDULE OF BUSINESS COMBINATION CONTINGENT CONSIDERATION Maturity Date Description Fair Value Interest rate Cash at closing $ 3,500,000 Promissory Notes 3/7/2023 Note 1 to ULHL 4,500,000 15.0 % 4/7/2023 Note 2 to ULHL 5,000,000 15.0 % 6/30/2023 Note 3 to ULHL 5,000,000 15.0 % 2/21/2025 Note 4 to ULHL 1,000,000 - 2/21/2025 Note 5 to FTS 500,000 - 6/30/2023 Note 6 to ULHL 2,000,000 - 6/30/2023 Note 7 to ULHL 1,000,000 - 19,000,000 Contingent considerations 6/30/2023 Note 8 to ULHL 2,500,000 15.0 % 2/21/2024 Note 9 to ULHL 2,000,000 - 2/21/2024 Earnout payment (estimated) 1,750,000 - 6,250,000 Purchase Price $ 28,750,000 Promissory Notes As part of the acquisition, the Company issued certain promissory notes consisting of the following: Promissory Note 1 in the principal amount of $ 4,500,000 which matures March 7, 2023 , having an interest rate of 15 %. Promissory Note 2 in the principal amount of $ 5,000,000 April 7, 2023 15 Promissory Note 3 in the principal amount of $ 5,000,000 which matures June 30, 2023 , having an interest rate of 15 % Promissory Note 4 in the principal amount of $ 1,000,000 February 21, 2025 Promissory Note 5 in the principal amount of $ 500,000 35 February 21, 2025 Promissory Note 6 in the principal amount of $ 2,000,000 due June 30, 2023 (the “Initial Taiwan Maturity Date”), bearing no interest and payable on: (a) July 15, 2023, provided that all government and other regulatory approvals necessary or required by Taiwan in order to consummate the Transaction as the same relates to Unique-Taiwan (the “Taiwan Approvals”) have been received by the Initial Taiwan Maturity Date; or (b) in the event that the Taiwan Approvals have not been received by the Taiwan Maturity Date, payment under this promissory note will be due and payable within fifteen (15) days of receipt of the Taiwan Approvals. This promissory note was issued in lieu of cash otherwise due under the original Local SPA in respect of the Purchased Shares of Unique-Taiwan. Promissory Note 7 in the principal amount of $ 1,000,000 due June 30, 2023 (the “Initial Vietnam Maturity Date”), bearing no interest and payable on: (a) July 15, 2023, provided that all government and other regulatory approvals necessary or required by Vietnam in order to consummate the Transaction as the same relates to Unique-Vietnam (the “Vietnam Approvals”) have been received by the Initial Vietnam Maturity Date; or (b) in the event that the Vietnam Approvals have not been received by the Vietnam Maturity Date, payment under this promissory note will be due and payable within fifteen (15) days of receipt of the Vietnam Approvals. This promissory note was issued in lieu of cash otherwise due under the original Local SPA in respect of the Purchased Shares of Unique-Vietnam. Contingent Considerations At Closing, the Company issued two additional promissory notes, in lieu of cash, as payment of certain milestones set forth in the SPA that were already achieved: ● Promissory Note 8 in the principal amount of $ 2,500,000 June 30, 2023 15 ● Promissory Note 9 in the principal amount of $ 2,000,000 February 21, 2024 As of the acquisition date and based on the preliminary assessment by management, the seller (ULHL) fully met its obligation as it relates to the purchase price adjustments provided by the SPA and would be entitled to full amount of the contingent consideration, therefore the Company recorded these notes at fair value as stated in the promissory notes as of February 28, 2023. In addition to the Initial Purchase Price, ULHL will be eligible for a one-time cash earn-out payment in the amount of (i) $ 2,500,000 5,000,000 2,000,000 5,000,000 4,500,000 1,750,000 All contingent considerations and earn out payment are recorded in other current liabilities on the balance sheet as of February 28, 2023, in the amount of $ 5,710,057 . While the first two contingent considerations were met by the Seller in its entirety, given the uncertain nature of the earn out payment, we conducted a sensitivity analysis based on both historical performance and projected performance throughout the period covered by the earn out payment. We determined the present value of the earn out payment based on the anticipated payment date of September 28, 2023, and the cost of debt of 15.0 %. Purchase Price Allocation The Company obtained full control of five subsidiaries during the acquisition identified above and consolidated these subsidiaries as of the acquisition date. US GAAP requires an acquirer to recognize the assets acquired, the liabilities assumed, and any noncontrolling interest in the acquirer at the acquisition date, measured at their fair values as of that date. The acquisition method of accounting requires extensive use of estimates and judgments to allocate the considerations transferred to the identifiable tangible and intangible assets acquired and liabilities assumed. The following summarizes preliminary estimates of fair values of the assets acquired and liabilities assumed at the acquisition: SCHEDULE OF FAIR VALUE OF ASSETS ACQUIRED AND LIABILITIES ASSUMED Fair Value Assets Acquired: Current assets $ 36,232,526 Equity method investments 10,861,111 Identifiable intangible assets 6,515,000 Fixed Assets and other non-current assets 2,367,272 Liabilities Assumed: Current liabilities (27,326,110 ) Other long-term liabilities (327,861 ) Non-Controlling Interest (3,558,263 ) Goodwill 3,986,325 Purchase Price $ 28,750,000 Total amount of goodwill recognized in this transaction was $ 9,478,477 5,492,152 3,986,325 The Company paid approximately $ 0.5 Identifiable intangible assets and their amortization periods are estimated as follows: SCHEDULE OF IDENTIFIABLE INTANGIBLE ASSETS AND AMORTIZATION PERIOD Cost Basis Useful Life Customer relationships $ 6,292,000 7 Non-compete agreements 223, 000 1 $ 6,515,000 Amortization of intangible assets was immaterial for the period from the acquisition date to the end of the reporting period February 28, 2023. The future amortization schedule is as follows: AMORTIZATION OF INTANGIBLE ASSETS 2024 $ 1,121,857 For the Twelve Months Ending February 28, 2024 $ 1,121,857 2025 898,857 2026 898,857 2027 898,857 2028 898,857 Thereafter 1,797,715 Total. $ 6,515,000 Equity Method Investments SCHEDULE OF FINANCIAL INFORMATION AT FAIR VALUE FOR EQUITY METHOD INVESTMENT The following summarizes financial information at fair value for the equity-method investments at the acquisition: Fair Value Current assets $ 17,493,164 Noncurrent assets 152,658 Total Assets 17,645,822 Current liabilities 6,907,904 Noncurrent liabilities - Total liabilities 6,907,904 Net assets of the equity investee 10,737,918 Equity attributable to non-controlling interest (5,368,959 ) Equity attributable to registrant 5,368,959 Equity goodwill attributable to registrant 5,492,152 Total Equity method investment $ 10,861,111 Pro Forma Information (Unaudited) The results of operations of eight entities which the Company acquired on February 21, 2023, have not been included in our February 28, 2023, condensed consolidated financial statements because of the company’s decision to include earnings from consolidated subsidiaries and equity method investments on a one-month lag basis. The following unaudited pro forma financial information represents a summary of the consolidated results of operations for the three and nine months ended February 28, 2022, assuming the acquisitions had been completed as of June 1, 2021, first day of the period presented. The proforma adjustments include the elimination of intercompany revenue and expense transactions. The pro forma financial information is not necessarily indicative of the results of operations that would have been achieved if the acquisitions had been effective as of these dates, or of future results. SCHEDULE OF PRO FORMA INFORMATION Three Months Ended February 28, 2022 Nine Months Ended February 28, 2022 Revenue, net $ 339,213,905 $ 1,040,963,776 Net Income attributable to registrant 1,030,332 18,653,614 Weighted average shares of common stock outstanding, basic and diluted (as previously reported) 655,781,078 582,680,746 Net income per share, basic and diluted $ - $ 0.03 |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 9 Months Ended |
Feb. 28, 2023 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 3. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consisted of the following on February 28, 2023, and May 31, 2022: SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES February 28, 2023 May 31, 2022 Accrued salaries and related expenses $ 2,519,124 $ 625,000 Accrued sales and marketing expense 1,173,564 2,383,500 Accrued professional fees 1,805,259 1,350,170 Accrued income tax 2,713,523 559,544 Accrued overdraft liabilities 1,156,708 681,058 Other accrued expenses and current liabilities 810,679 66,887 Accrued expenses and other current liabilities $ 10,178,857 $ 5,666,159 |
FINANCING ARRANGEMENTS
FINANCING ARRANGEMENTS | 9 Months Ended |
Feb. 28, 2023 | |
Debt Disclosure [Abstract] | |
FINANCING ARRANGEMENTS | 4. FINANCING ARRANGEMENTS Financing arrangements on the consolidated balance sheets consists of: SCHEDULE OF FINANCING ARRANGEMENT February 28, 2023 May 31, 2022 Revolving Credit Facility $ 9,882,529 $ 38,141,451 Current portion of notes payable 17,804,500 608,333 Notes payable, gross 27,687,029 38,749,784 Noncurrent portion of notes payable 1,500,000 - Long term, notes payable $ 29,187,029 $ 38,749,784 Revolving Credit Facility On June 1, 2021, the Company entered a Revolving Purchase, Loan and Security Agreement (the “TBK Agreement”) with TBK BANK, SSB, a Texas State Savings Bank (“TBK”), for a facility under which TBK will, from time to time, buy approved receivables from the Company. This line was subject to periodic increases and on April 14, 2022, the parties entered into a Fourth Amendment to temporarily increase the credit facility availability from $ 47.5 57.5 47.5 Notes Payable On May 29, 2020, as part of the acquisition of UL ATL the Company entered into a $ 1,825,000 The agreement calls for six semi-annual payments of $ 304,167 May 29, 2023 304,167 608,333 On February 21, 2023, as part of the acquisitions of ULHL operating subsidiaries, the Company recorded $ 19.0 17.5 1.5 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Feb. 28, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 5. RELATED PARTY TRANSACTIONS The Company has the following debt due to related parties: SCHEDULE OF RELATED PARTY TRANSACTION February 28, 2023 May 31, 2022 Due to Frangipani Trade Services (1) $ 451,964 $ 602,618 Due to employee (2) 7,500 30,000 Due to employee (3) 16,661 66,658 476,124 699,276 Less: current portion (325,478 ) (301,308 ) $ 150,655 $ 397,968 (1) Due to Frangipani Trade Services (“FTS”), an entity owned by the Company’s CEO, is due on demand and is non-interest bearing. The principal amount of this Promissory Note bears no interest provided that any amount due under this Note which is not paid when due shall bear interest at an interest rate equal to six percent ( 6 150,655 (2) On May 29, 2020, the Company entered into a $ 90,000 2,500 (3) On May 29, 2020, the Company entered into a $ 200,000 5,556 Accounts Receivable and Payable Transactions with related parties account for $ 7.2 10.8 3.0 15.2 Revenue and Expenses Revenue from related party transactions is for export services from related parties or for delivery at place imports nominated by such related parties. For the three months ended February 28, 2023 and 2022 these transactions represented approximately $ 6.4 1.2 5.5 1.9 Direct costs are services billed to the Company by related parties for shipping activities. For the three months ended February 28, 2023 and 2022 these transactions represented approximately $ 4.5 13.1 32.5 39.0 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 9 Months Ended |
Feb. 28, 2023 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | 6. STOCKHOLDERS’ EQUITY Common Stock The Company is authorized to issue 800,000,000 0.001 During the three and nine months ended February 28, 2023, there were no Preferred Shares The Company is authorized to issue 5,000,000 0.001 Series A Convertible Preferred The holders of Series A Preferred. subject to the rights of holders of shares of the Company’s Series B Preferred which shares will be pari passu with Series B Preferred in terms of liquidation preference and dividend rights and are subject to an anti-dilution provision, making the holders subject to an adjustment necessary to maintain their agreed upon fully diluted ownership percentage. In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, the stockholders of record of shares of Series A Preferred shall be entitled to receive, at their option, immediately prior and in preference to any distribution to the holders of the Company’s common stock, $ 0.001 During the nine months ended February 28, 2023, a shareholder converted 9,935 67,963,732 Series B Convertible Preferred The holders of Series B Preferred, subject to the rights of holders of shares of the Company’s Series A Preferred Stock which shares will be pari passu with the Series B Preferred in terms of liquidation preference and dividend rights, shall be entitled to receive, at their option, immediately prior an in preference to any distribution to the holders of the Company’s common stock. In the event of any liquidation, dissolution or winding up of the Company, either voluntary or involuntary, the stockholders of record of shares of Series B Preferred shall be entitled to receive, at their option, immediately prior and in preference to any distribution to the holders of the Company’s common stock, $ 0.001 During the nine months ended February 28, 2023 there were no conversions of Series B Preferred Shares. During the nine months ended February 28, 2022 the Company issued 125,692,224 19,200 100 Series C & D Convertible Preferred The holders of the Preferred Stock shall be entitled to receive, upon liquidation, dissolution or winding up of the Company, the amount of cash, securities, or other property to which such holder would be entitled to receive with respect to such shares of Preferred Stock if such shares had been converted to common stock immediately prior to such liquidation. During the nine months ended February 28, 2023, a shareholder converted 7 43,981,560 During the nine months ended February 28, 2022 there were no conversions of Series C and D Preferred Shares. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Feb. 28, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 7. COMMITMENTS AND CONTINGENCIES Litigation From time to time, the Company may become involved in litigation relating to claims arising in the ordinary course of the business. There are no claims or actions pending or threatened against the Company that, if adversely determined, would in the Company’s management’s judgment have a material adverse effect on the Company. Leases The Company leases office space, warehouse facilities and equipment under non-cancellable lease agreements expiring on various dates through October 2028. Office leases contain provisions for future rent increases. The Company adopted ASC 842 from inception, requiring the Company to recognize an asset and liability on the consolidated balance sheets for lease arrangements with terms longer than 12 months. The Company has elected the practical expedient to not apply the recognition requirement to leases with a term of less than one year (short term leases). The Company uses its incremental borrowing rate to discount lease payments to present value. The incremental borrowing rate is based on the estimated interest rate the Company could obtain for borrowing over a similar term of the lease at commencement date. Rental escalations, renewal options and termination options, when applicable, have been factored into the Company’s determination of lease payments when appropriate. The Company does not separate lease and non-lease components of contracts. Variable payments related to pass-through costs for maintenance, taxes and insurance or adjustments based on an index such as Consumer Price Index are not included in the measurement of the lease liability or asset and are expensed as incurred. The components of lease expense were as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE For the For the February 28, 2023 February 28, 2022 Operating lease $ 531,728 $ 310,965 Interest on lease liabilities 202,885 16,910 Total net lease cost $ 734,613 $ 327,875 For the For the February 28, 2023 February 28, 2022 Operating lease $ 1,269,299 $ 1,103,649 Interest on lease liabilities 363,398 104,242 Total net lease cost $ 1,632,697 $ 1,207,891 Supplemental balance sheet information related to leases was as follows: SCHEDULE OF SUPPLEMENT BALANCE SHEET INFORMATION February 28, 2023 May 31, 2022 Operating leases: Operating lease ROU assets – net $ 10,931,331 $ 2,408,098 Current operating lease liabilities, included in current liabilities 2,422,306 912,618 Noncurrent operating lease liabilities, included in long-term liabilities 8,813,569 1,593,873 Total operating lease liabilities $ 11,235,875 $ 2,506,491 The operating lease right of use asset and corresponding lease liabilities were significantly impacted during the nine-month ended February 28, 2023, by a renewal of a warehouse lease located in in Santa Fe Springs, CA with a term of 5 years 5 years 3 years 10.0 Supplemental cash flow and other information related to leases was as follows: SCHEDULE OF SUPPLEMENTAL CASH FLOW AND OTHER INFORMATION RELATED TO LEASES For Nine Months For Nine Months Ended Ended February 28, 2023 February 28, 2022 ROU assets obtained in exchange for lease liabilities: Operating leases $ 8,897,639 $ 1,098,769 Weighted average remaining lease term (in years): Operating leases 4.60 3.98 Weighted average discount rate: Operating leases 8.57 % 4.25 % As of February 28, 2023, future minimum lease payments under noncancelable operating leases are as follows: SCHEDULE OF MINIMUM LEASE PAYMENTS For the Twelve Months Ending February 28, 2024 $ 3,281,807 2025 3,024,640 2026 2,660,969 2027 2,537,799 2028 1,978,600 Thereafter 131,485 Total lease payments 13,615,299 Less: imputed interest (2,379,424 ) Total lease obligations $ 11,235,875 |
INCOME TAX PROVISION
INCOME TAX PROVISION | 9 Months Ended |
Feb. 28, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAX PROVISION | 8. INCOME TAX PROVISION The income tax provision consists of the following: SCHEDULE OF INCOME TAX EXPENSE For the For the Three Month Ended February 28, 2022 Federal provision (benefit) Current $ (134,755 ) $ (93,752 ) Deferred (135,654 ) 343,363 Foreign 10,299 - State and Local provision (benefit) Current (542,436 ) (81,039 ) Deferred (11,534 ) 59,635 Total provision $ (814,080 ) $ 228,207 For the For the Nine Month Ended February 28, 2022 Federal provision (benefit) Current $ 1,194,842 $ 2,294,248 Deferred (188,613 ) 83,784 Foreign 10,299 - State and Local provision (benefit) Current (138,956 ) 371,961 Deferred (27,605 ) 15,214 Total provision $ 849,967 $ 2,765,207 In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon future generation for taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. For the three and nine months ended February 28, 2023 and 2022, there was no The Company evaluated the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740 prescribes a comprehensive model for how a company should recognize, present, and disclose uncertain positions that the Company has taken or expects to take in its tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. Differences between tax positions taken or expected to be taken in a tax return and the net benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits.” A liability is recognized (or amount of net operating loss carry forward or amount of tax refundable is reduced) for unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. If applicable, interest costs related to the unrecognized tax benefits are required to be calculated and would be classified as “Other expenses – Interest” in the statement of operations. Penalties would be recognized as a component of “General and administrative.” No The Company’s deferred tax assets (liabilities) consisted of the effects of temporary differences attributable to the following: SCHEDULE OF DEFERRED TAX ASSETS (LIABILITIES) Deferred Tax Assets February 28, 2023 May 31, 2022 Allowance for doubtful accounts $ 694,532 $ 733,139 Consulting contract liability 218,137 230,263 Lease liability 2,512,188 659,460 Other 548,364 238,006 Total deferred tax assets 3,973,221 1,860,868 Deferred Tax Liabilities Operating lease right-of-use assets $ (2,418,863 ) $ (631,173 ) Goodwill and intangibles (321,736 ) (256,533 ) Fixed assets (39,012 ) (30,414 ) Net deferred tax asset $ 1,193,610 $ 942,748 The expected tax expense (benefit) based on the statutory rate is reconciled with actual tax expense benefit as follows: SCHEDULE OF EXPECTED TAX EXPENSE (BENEFIT) For the Nine Months Ended February 28, 2023 For the Nine Months Ended February 28, 2022 US Federal statutory rate 21.0 - % 21.0 % State income tax, net of federal benefit 2.0 % 9 % Foreign income taxes and adjustments 0.6 % - % Prior year provision adjustment to actual (6.3 )% - % FDII deduction (6.7 )% - % Change in valuation allowance - (3.0 )% Other permanent differences, net (0.1 )% 1.0 % Income tax provision 10.5 % 28.0 % |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Feb. 28, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 9. SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date the consolidated financial statements were available to be issued. Based on this evaluation, the Company has identified no reportable subsequent events other than those disclosed elsewhere in these consolidated financial statements. On March 10, 2023, the Company entered into a financing agreement and related fee letter as borrower with certain of its subsidiaries party thereto as guarantors, the lenders party thereto, CB Agent Services LLC, as origination agent, and Alter Domus (US) LLC, as collateral agent, and administrative agent. The Financing Agreement provides for an initial senior secured term loan in a principal amount of $ 4,210,526.32 14,789,473.68 Subsequently to quarter ended on February 28, 2023, the Company paid off two of the Promissory Notes to the Seller (See Note 2, Acquisitions) including associated interest, and made a partial payment on another note, as follows: SCHEDULE OF PROMISSORY NOTES DUE Promissory Notes Due 3/7/2023 Note 1 to ULHL $ 4,500,000 15.0 % 4/7/2023 Note 2 to ULHL 5,000,000 15.0 % 6/30/2023 Note 3 to ULHL 500,000 15.0 % Total: $ 10,000,000 |
NATURE OF BUSINESS AND SUMMAR_2
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Feb. 28, 2023 | |
Accounting Policies [Abstract] | |
Nature of Business | Nature of Business Unique Logistics International, Inc. and its subsidiaries (the “Company” or “Unique”) is a global logistics and freight forwarding company. The Company provides a range of international logistics services that enable its customers to outsource sections of their supply chain process. This range of services can be categorized as follows: ● Air Freight ● Ocean Freight ● Customs Brokerage and Compliance ● Warehousing and Distribution ● Order Management |
Basis of Presentation | Basis of Presentation These condensed consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include all accounts of the Company and its subsidiaries stated in U.S. dollars, the Company’s functional currency. For subsidiaries operating outside the U.S., the financial information will be accounted for on a one-month lag. Substantially all unremitted earnings of international subsidiaries are free of legal and contractual restrictions. The unaudited interim financial information furnished herein reflects all adjustments, consisting solely of normal recurring items, which in the opinion of management are necessary to fairly state the financial position of the Company and the results of its operations for the periods presented. This report should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in the Company’s Form 10-K for the year ended May 31, 2022. The Company assumes that the users of the interim financial information herein have read or have access to the audited financial statements for the preceding fiscal year and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The condensed consolidated balance sheet on May 31, 2022 was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. Principles of Consolidation The consolidated financial statements of the Company include the accounts of the Company and its majority owned subsidiaries stated in U.S. dollars, the Company’s functional currency. All intercompany transactions and balances have been eliminated in the condensed consolidated financial statements. |
Acquisitions | Acquisitions These condensed consolidated financial statements include the operations of acquired businesses from the date of the acquisitions. The decision of whether to consolidate an entity for financial reporting purposes requires consideration of majority voting interests, as well as effective economic or other control over the entity. We account for acquired businesses that we control using the acquisition method of accounting, which requires, among other things, that most assets acquired, and liabilities assumed be recognized at their estimated fair values as of the acquisition date. Transaction costs are expensed as incurred. Any excess of the consideration transferred over the assigned values of the net assets acquired is recorded as goodwill. Contingent consideration in a business combination is included as part of the contingent liability and is recognized at fair value as of the acquisition date. Fair value is generally estimated by using a probability-weighted discounted cash flow approach. Any liability resulting from contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved. These changes in fair value are recognized in earnings. For equity-method investments in share capital of the subsidiaries where share interest acquired is less than 50%, but we have significant influence over the financial and operating policies of the investee, we use the equity method of accounting. Under the equity-method, we record our share of the investee’s income and expenses in income from operation and any share of the earnings and loss would be recorded against investment reduced by cash dividends received. The initial excess of the cost of the investment over our share of the underlying equity in the net assets of the investee as of the acquisition date is allocated to the identifiable assets and liabilities of the investee, with any remaining excess amount allocated to goodwill. Such investments are initially recorded at cost, which is the fair value of consideration paid and typically does not include contingent consideration. For equity-method investments, an impairment charge is recorded only if and when a decline in fair value is determined to be other-than-temporary. |
Use of Estimates | Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reported period. Actual results could differ from those estimates. Significant estimates inherent in the preparation of the condensed consolidated financial statements include determinations of the useful lives and expected future cash flows of long-lived assets, including intangibles, valuation of assets and liabilities acquired in business combinations, and estimates and assumptions in valuation of debt and equity instruments, including derivative liabilities. In addition, the Company makes significant judgments to recognize revenue – see policy note “ Revenue Recognition |
Foreign Currency Translation | Foreign Currency Translation For most of our international operations conducted by the subsidiaries operating outside the U.S, local currencies have been determined to be functional currencies. We translate functional currency assets and liabilities to their U.S. dollar equivalents at exchange rates in effect as of the balance sheet date and income and expense amounts at average exchange rates for the period. The U.S. dollar affects that arise from changing translation rates are recorded in Other comprehensive income/(loss). The effects of converting non-functional currency monetary assets and liabilities into the functional currency are recorded in Other (income)/deductions. |
Liquidity | Liquidity The accompanying condensed consolidated financial statements have been prepared on a going concern basis. Substantial doubt about an entity’s ability to continue as a going concern exists when conditions and events, considered in the aggregate, indicate that it is probable that the entity will be unable to meet its obligations as they become due within one year after the date that the financial statements are issued. As of February 28, 2023, the Company reported negative working capital of $ 9.7 4.2 3.5 23.8 1.5 3.8 6.5 10.9 The Company intends to either timely pay off the $ 23.8 10.0 Subsequent Events As previously reported, on December 18, 2022, the Company entered into an Agreement and Plan of Merger with Edify Acquisition Corp. and Edify Merger Sub, Inc. that, subject to various conditions, included a commitment from a lender for a senior secured financing facility in the maximum aggregate principal amount of $ 35.0 on March 10, 2023, the Company e as 4,210,526.32 14,789,473.68 9.0 Subsequent Events. In addition, the Company maintains its operating line of credit with TBK Bank, SSB, under which TBK Bank will, from time to time, buy approved receivables from the Company, which has a credit limit up to $ 47.5 While we continue to execute our strategic plan, growing the Company and its customer base, management is focused on managing cash and monitoring our liquidity position. We have implemented several initiatives to conserve our liquidity position, including activities such as increasing credit facilities, when needed, reducing the cost of debt by obtaining more favorable financing, controlling general and administrative expenditures and improving our collection processes. Many of the aspects of the liquidity plan involve management’s judgments and estimates that include factors that could be beyond our control and actual results could differ from our estimates. These and other factors could cause the strategic plan to be unsuccessful, which could have a material adverse effect on our operating results, financial condition, and liquidity. Negative operating capital may be an indicator that there could be a going concern issue, but based on our evaluation of the Company’s projected cash flows and business performance as of and subsequent to February 28, 2023, management has concluded that the Company’s current cash and cash availability under the TBK Facility as of February 28, 2023, would be sufficient to fund its planned operations for at least one year from the date the consolidated financial statements were issued. |
Fair Value Measurement | Fair Value Measurement The Company follows the authoritative guidance that establishes a formal framework for measuring fair values of assets and liabilities in the consolidated financial statements that are already required by generally accepted accounting principles to be measured at fair value. The guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The transaction is based on a hypothetical transaction in the principal or most advantageous market considered from the perspective of the market participant that holds the asset or owes the liability. The Company utilizes market data or assumptions that market participants who are independent, knowledgeable, and willing and able to transact would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable. The Company attempts to utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. The Company is able to classify fair value balances based on the observability of those inputs. The guidance establishes a formal fair value hierarchy based on the inputs used to measure fair value. The hierarchy gives the highest priority to Level 1 measurements and the lowest priority to level 3 measurements, and accordingly, Level 1 measurement should be used whenever possible. The hierarchy is broken down into three levels based on the reliability of inputs as follows: Level 1 – Quoted prices in active markets for identical assets or liabilities or published net asset value for alternative investments with characteristics similar to a mutual fund. Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 – Unobservable inputs for the asset or liability. The methods used may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while management believes its valuation methods are appropriate, the fair value of certain financial instruments could result in a difference fair value measurement at the reporting date. There were no changes in the Company’s valuation methodologies from the prior year. For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amounts for financial assets and liabilities such as cash and cash equivalents, accounts receivable - trade, contract assets, factoring reserve, other prepaid expenses and current assets, accounts payable – trade and other current liabilities, including contract liabilities, convertible notes, promissory notes, all approximate fair value due to their short-term nature as of February 28, 2023, and May 31, 2022. The carrying amount of the long-term debt approximates fair value because the interest rates on these instruments approximate the interest rate on debt with similar terms available to the Company. Lease liabilities approximate fair value based on the incremental borrowing rate used to discount future cash flows. The Company had Level 3 liabilities (See Derivative liabilities note) as of February 28, 2023 and May 31, 2022. There were no transfers between levels during the reporting period. |
Accounts Receivable | Accounts Receivable Accounts receivable from revenue transactions are based on invoiced prices which the Company expects to collect. In the normal course of business, the Company extends credit to customers that satisfy pre-defined credit criteria. The Company generally does not require collateral to support customer receivables. Accounts receivable, as shown on the consolidated balance sheets, is net of allowances when applicable. An allowance for doubtful accounts is determined through analysis of the aging of accounts receivable at the date of the consolidated financial statements, assessments of collectability based on an evaluation of historic and anticipated trends, the financial condition of the Company’s customers, and an evaluation of the impact of economic conditions. The maximum accounting loss from the credit risk associated with accounts receivable is the amount receivable recorded, net of allowance for doubtful accounts. As of February 28, 2023, and May 31, 2022 the Company recorded an allowance for doubtful accounts of approximately $ 1.7 2.7 Concentrations As of February 28, 2023, three major customers represented approximately 13.0 10.0 % of total accounts receivable. Revenue from these customers in the aggregate as a percentage of the Company’s total revenue was 18.0 % and 20.0 % for the three and nine months ended February 28, 2023, respectively, and no single customer represented more than 10.0 % of total revenue. As of May 31, 2022, three major customers represented approximately 21.0 10.0 50.0 52.0 39.0 38.0 10.0 |
Derivative Liability | Derivative Liability On December 10, 2021, the Company entered into an amended securities exchange agreement with the holders of convertible notes to exchange all Convertible Notes of the Company into shares of the Convertible Preferred Stock Series C and D. Similar to the Convertible Preferred Stock Series A, these preferred stocks featured anti-dilution provision that expire on a specified date. Management has determined the anti-dilution provision embedded in preferred stock Series A, C and D is required to be accounted for separately from the preferred stock as a derivative liability and recorded at fair value. Separation of the anti-dilution option as a derivative liability is required because its economic characteristics are considered more akin to an equity instrument and therefore the anti-dilution option is not considered to be clearly and closely related to the economic characteristics of the preferred stock. The Company has identified and recorded derivative instruments arising from an anti-dilution provision in the Company’s Series A, C and D Preferred Stock. An embedded derivative liability is representing the rights of holders of Convertible Preferred Stock Series A, C and D to receive additional common stock of the Company upon issuance of any additional common stock by the Company prior to qualified financing event as defined in the agreement. Each reporting period, the embedded derivative liability, if material, would be adjusted to reflect fair value at each period end with changes in fair value recorded in the “Change in fair value of embedded derivative liability” financial statement line item of the company’s statements of operations. During the nine months ended February 28, 2023, the Company recorded a change in fair value of $ 809,611 SCHEDULE OF DERIVATIVE LIABILITIES Level 1 Level 2 Level 3 Derivative liabilities as May 31, 2022 $ - $ - $ 12,437,994 Addition - - - Change in fair value - - (809,611 ) Derivative liabilities as February 28, 2023 $ - $ - $ 11,628,383 The underlying value of the anti-dilution provision is calculated from estimating the probability and value of the provision assuming a near term financing event. For the period ended May 31, 2022, the model used estimates the potential that the company completes a capital raise prior to the expiration of the anti-dilution feature and determines the value of the anti-dilution feature given these assumptions. The model required the use of certain assumptions. These assumptions include the probability of a raise is completed, probability certain anti-dilution features are extended, estimated raise amount, term to a raise, and an appropriate risk-free interest rate. For the period ended February 28, 2023, due to changes in the way antidilutive shares of Convertible Preferred Series A, C and D would be exchanged in the near future for common stock, and the fact that the antidilution provision of these shares was extended through December 31, 2023, the assumptions were changed to include probability of the financing event, estimated value of common stock at the exchange point and estimated time to financing event. The key inputs into the model were as follows: SCHEDULE OF FAIR VALUE ASSUMPTION February 28, 2023 May 31, 2022 Risk-free interest rate 5.0 % 1.60 % Probability of financing event or capital raise 90 % 50 % Estimated capital raise - 39.0 million Estimated value of common stock $ 10.00 per share - Estimated time to financing event 0.25 0.5 |
Revenue Recognition | Revenue Recognition The Company adopted ASC 606, Revenue from Contracts with Customers To determine revenue recognition, the Company applies the following five steps: 1. Identify the contract(s) with a customer; 2. Identify the performance obligations in the contract; 3. Determine the transaction price; 4. Allocate the transaction price to the performance obligations in the contract; and 5. Recognize revenue as or when the performance obligation is satisfied. Revenue is recognized as follows: i. Freight income - export sales Freight income from the provision of air, ocean, and land freight forwarding services are recognized over time based on a relative transit time basis through the sail or departure from origin port. The Company is the principal in these transactions and recognizes revenue on a gross basis. ii. Freight income - import sales Freight income from the provision of air, ocean, and land freight forwarding services are recognized over time based on a relative transit time basis through the delivery to the customer’s designated location. The Company is the principal in these transactions and recognizes revenue on a gross basis. iii. Customs brokerage and other service income Customs brokerage and other service income from the provision of other services are recognized at the point in time the performance obligation is met. The Company’s business practices require, for accurate and meaningful disclosure, that it recognizes revenue over time. The “over time” policy is the period from point of origin to arrival of the shipment at the Port of entry (or in the case when the customer requires delivery to a designated point, the arrival at that delivery point). This overtime policy requires the Company to make significant judgements to recognize revenue over the estimated duration of time from port of origin to arrival at port of entry. The point in the process when the Company meets its obligation in the port of entry and the subsequent transfer of the goods to the customer is when the customer has the obligation to pay, has taken physical possession, has legal title, risk and awards (ownership) and has accepted the goods. The Company has elected to not disclose the aggregate amount of the transaction price allocated to performance obligations that are unsatisfied as of the end of the period as the Company’s contracts with its customers have an expected duration of one year or less. The Company uses independent contractors and third-party carriers in the performance of its transportation services. The Company evaluates who controls the transportation services to determine whether its performance obligation is to transfer services to the customer or to arrange for services to be provided by another party. The Company determined it acts as the principal for its transportation services performance obligation since it is in control of establishing the prices for the specified services, managing all aspects of the shipments process and assuming the risk of loss for delivery and collection. Revenue billed prior to realization is recorded as contract liabilities on the consolidated balance sheets and contract costs incurred prior to revenue recognition are recorded as contract assets on the consolidated balance sheets. Contract Assets Contract assets represent amounts for which the Company has the right to consider for the services provided while a shipment is still in-transit but for which it has not yet completed the performance obligation and has not yet invoiced the customer. Upon completion of the performance obligations, which can vary in duration based upon the method of transport and billing the customer, these amounts become classified within accounts receivable. Contract Liabilities Contract liabilities represent the amount of obligation to transfer goods or services to a customer for which consideration has been received. Significant Changes in Contract Asset and Contract Liability Balances for the nine months ended February 28,2023: SCHEDULE OF CHANGES IN CONTRACT ASSET AND CONTRACT LIABILITY Contract Contract Assets Liabilities Increase (Increase) (Decrease) Decrease Reclassification of the beginning contract liabilities to revenue, as the result of performance obligation satisfied $ - $ 468,209 Cash Received in advance and not recognized as revenue - (358,365 ) Reclassification of the beginning contract assets to receivables, as the result of rights to consideration becoming unconditional (39,978,761 ) - Contract assets recognized, net reclassification to receivables 12,867,742 - Net Change $ (27,111,019 ) $ 109,844 Disaggregation of Revenue from Contracts with Customers The following table disaggregates gross revenue from our clients by significant geographic area for the three and six months ended February 28, 2023, and 2022, based on origin of shipment (imports) or destination of shipment (exports): SCHEDULE OF DISAGGREGATION OF REVENUE For the Three For the Three Months Ended Months Ended February 28, 2023 February 28, 2022 China, Hong Kong & Taiwan $ 17,427,833 $ 82,006,657 Southeast Asia 9,335,793 121,340,162 United States 8,022,489 5,049,985 India Sub-continent 8,602,665 34,943,595 Other 6,238,722 7,095,496 Total revenue $ 49,627,502 $ 250,435,895 For the Nine For the Nine Months Ended Months Ended February 28, 2023 February 28, 2022 China, Hong Kong & Taiwan $ 123,977,602 $ 285,424,103 Southeast Asia 72,449,913 361,600,180 United States 29,699,664 28,254,253 India Sub-continent 37,919,338 134,393,170 Other 10,927,090 35,966,738 Total revenue $ 274,973,607 $ 845,638,444 |
Segment Reporting | Segment Reporting Based on the guidance provided by ASC Topic 280, Segment Reporting |
Earnings per Share | Earnings per Share The Company adopted ASC 260, Earnings per share, The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income attributable to common stockholders per common share. SCHEDULE OF EARNING PER SHARE February 28, 2023 February 28, 2022 For the Three Months Ended February 28, 2023 February 28, 2022 Numerator: Net income (loss) attributable to common stockholders $ 663,173 $ (9,496,311 ) Effect of dilutive securities: - - Diluted net income (loss) $ 663,173 $ (9,496,311 ) Denominator: Weighted average common shares outstanding – basic 799,141,770 655,781,078 Dilutive securities: Series A Preferred 1,168,177,320 - Series B Preferred 5,373,342,576 - Series C Preferred 1,206,351,359 - Series D Preferred 1,130,954,399 - Weighted average common shares outstanding and assumed conversion – diluted 9,677,967,424 655,781,078 Basic net income per common share $ 0.00 $ (0.01 ) Diluted net income per common share $ 0.00 $ (0.01 ) February 28, 2023 February 28, 2022 For the Nine Months Ended February 28, 2023 February 28, 2022 Numerator: Net income (loss) attributable to common stockholders $ 7,256,211 $ (2,984,670 ) Effect of dilutive securities: - - Diluted net income (loss) $ 7,256,211 $ (2,984,670 ) Denominator: Weighted average common shares outstanding – basic 780,768,778 582,680,746 Dilutive securities: Series A Preferred 1,168,177,320 - Series B Preferred 5,373,342,576 - Series C Preferred 1,206,351,359 - Series D Preferred 1,130,954,399 - Weighted average common shares outstanding and assumed conversion – diluted 9,659,594,432 582,680,746 Basic net income per common share $ 0.01 $ (0.01 ) Diluted net income per common share $ 0.00 $ (0.01 ) |
Leases | Leases The Company recognizes a right of use (“ROU”) asset and liability in the consolidated balance sheet primarily related to its operating leases of office space, warehouse space and equipment. Right-of-use assets represent the Company’s right to use an underlying asset for the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. All ROU assets and lease liabilities are recognized at the commencement date at the present value of lease payments over the lease term. ROU assets are adjusted for lease incentives and initial direct costs. The lease term includes renewal options exercised at the Company’s sole discretion when the Company is reasonably certain to exercise that option. As the Company’s leases generally do not have an implicit rate, the Company uses an estimated incremental borrowing rate based on borrowing rates available to them at the commencement date to determine the present value. Certain of our leases include variable payments, which may vary based upon changes in facts or circumstances after the start of the lease. The Company excludes variable payments from ROU assets and lease liabilities to the extent not considered fixed, and instead expenses variable payments as incurred. Lease expense is recognized on a straight-line basis over the lease term and is included in rent and occupancy expenses in the consolidated statements of operations. |
Reclassifications | Reclassifications Certain prior year amounts have been reclassified for consistency with the current year presentation. |
NATURE OF BUSINESS AND SUMMAR_3
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Feb. 28, 2023 | |
Accounting Policies [Abstract] | |
SCHEDULE OF DERIVATIVE LIABILITIES | SCHEDULE OF DERIVATIVE LIABILITIES Level 1 Level 2 Level 3 Derivative liabilities as May 31, 2022 $ - $ - $ 12,437,994 Addition - - - Change in fair value - - (809,611 ) Derivative liabilities as February 28, 2023 $ - $ - $ 11,628,383 |
SCHEDULE OF FAIR VALUE ASSUMPTION | The key inputs into the model were as follows: SCHEDULE OF FAIR VALUE ASSUMPTION February 28, 2023 May 31, 2022 Risk-free interest rate 5.0 % 1.60 % Probability of financing event or capital raise 90 % 50 % Estimated capital raise - 39.0 million Estimated value of common stock $ 10.00 per share - Estimated time to financing event 0.25 0.5 |
SCHEDULE OF CHANGES IN CONTRACT ASSET AND CONTRACT LIABILITY | Significant Changes in Contract Asset and Contract Liability Balances for the nine months ended February 28,2023: SCHEDULE OF CHANGES IN CONTRACT ASSET AND CONTRACT LIABILITY Contract Contract Assets Liabilities Increase (Increase) (Decrease) Decrease Reclassification of the beginning contract liabilities to revenue, as the result of performance obligation satisfied $ - $ 468,209 Cash Received in advance and not recognized as revenue - (358,365 ) Reclassification of the beginning contract assets to receivables, as the result of rights to consideration becoming unconditional (39,978,761 ) - Contract assets recognized, net reclassification to receivables 12,867,742 - Net Change $ (27,111,019 ) $ 109,844 |
SCHEDULE OF DISAGGREGATION OF REVENUE | The following table disaggregates gross revenue from our clients by significant geographic area for the three and six months ended February 28, 2023, and 2022, based on origin of shipment (imports) or destination of shipment (exports): SCHEDULE OF DISAGGREGATION OF REVENUE For the Three For the Three Months Ended Months Ended February 28, 2023 February 28, 2022 China, Hong Kong & Taiwan $ 17,427,833 $ 82,006,657 Southeast Asia 9,335,793 121,340,162 United States 8,022,489 5,049,985 India Sub-continent 8,602,665 34,943,595 Other 6,238,722 7,095,496 Total revenue $ 49,627,502 $ 250,435,895 For the Nine For the Nine Months Ended Months Ended February 28, 2023 February 28, 2022 China, Hong Kong & Taiwan $ 123,977,602 $ 285,424,103 Southeast Asia 72,449,913 361,600,180 United States 29,699,664 28,254,253 India Sub-continent 37,919,338 134,393,170 Other 10,927,090 35,966,738 Total revenue $ 274,973,607 $ 845,638,444 |
SCHEDULE OF EARNING PER SHARE | The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income attributable to common stockholders per common share. SCHEDULE OF EARNING PER SHARE February 28, 2023 February 28, 2022 For the Three Months Ended February 28, 2023 February 28, 2022 Numerator: Net income (loss) attributable to common stockholders $ 663,173 $ (9,496,311 ) Effect of dilutive securities: - - Diluted net income (loss) $ 663,173 $ (9,496,311 ) Denominator: Weighted average common shares outstanding – basic 799,141,770 655,781,078 Dilutive securities: Series A Preferred 1,168,177,320 - Series B Preferred 5,373,342,576 - Series C Preferred 1,206,351,359 - Series D Preferred 1,130,954,399 - Weighted average common shares outstanding and assumed conversion – diluted 9,677,967,424 655,781,078 Basic net income per common share $ 0.00 $ (0.01 ) Diluted net income per common share $ 0.00 $ (0.01 ) February 28, 2023 February 28, 2022 For the Nine Months Ended February 28, 2023 February 28, 2022 Numerator: Net income (loss) attributable to common stockholders $ 7,256,211 $ (2,984,670 ) Effect of dilutive securities: - - Diluted net income (loss) $ 7,256,211 $ (2,984,670 ) Denominator: Weighted average common shares outstanding – basic 780,768,778 582,680,746 Dilutive securities: Series A Preferred 1,168,177,320 - Series B Preferred 5,373,342,576 - Series C Preferred 1,206,351,359 - Series D Preferred 1,130,954,399 - Weighted average common shares outstanding and assumed conversion – diluted 9,659,594,432 582,680,746 Basic net income per common share $ 0.01 $ (0.01 ) Diluted net income per common share $ 0.00 $ (0.01 ) |
ACQUISITIONS AND EQUITY METHO_2
ACQUISITIONS AND EQUITY METHOD INVESTMENTS (Tables) | 9 Months Ended |
Feb. 28, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule Of Acquired Subsidiary | Schedule Of Acquired Subsidiary Name of acquired operating subsidiary Purchased Percentage Designation Unique Logistics International (H.K.) Limited 100 Consolidated subsidiary Unique Logistics International (Vietnam) Co., Ltd. 65 Consolidated subsidiary ULI (South China) Limited 70 Consolidated subsidiary Unique Logistics International (South China) Limited 70 Consolidated subsidiary Unique Logistics International (India) Private Ltd. 65 Consolidated subsidiary ULI (North & East China) Company Limited 50 Equity-method investment Unique Logistics International Co., Ltd 50 Equity-method investment TGF Unique Limited 49.99 Equity-method investment |
SCHEDULE OF BUSINESS COMBINATION CONTINGENT CONSIDERATION | SCHEDULE OF BUSINESS COMBINATION CONTINGENT CONSIDERATION Maturity Date Description Fair Value Interest rate Cash at closing $ 3,500,000 Promissory Notes 3/7/2023 Note 1 to ULHL 4,500,000 15.0 % 4/7/2023 Note 2 to ULHL 5,000,000 15.0 % 6/30/2023 Note 3 to ULHL 5,000,000 15.0 % 2/21/2025 Note 4 to ULHL 1,000,000 - 2/21/2025 Note 5 to FTS 500,000 - 6/30/2023 Note 6 to ULHL 2,000,000 - 6/30/2023 Note 7 to ULHL 1,000,000 - 19,000,000 Contingent considerations 6/30/2023 Note 8 to ULHL 2,500,000 15.0 % 2/21/2024 Note 9 to ULHL 2,000,000 - 2/21/2024 Earnout payment (estimated) 1,750,000 - 6,250,000 Purchase Price $ 28,750,000 |
SCHEDULE OF FAIR VALUE OF ASSETS ACQUIRED AND LIABILITIES ASSUMED | The following summarizes preliminary estimates of fair values of the assets acquired and liabilities assumed at the acquisition: SCHEDULE OF FAIR VALUE OF ASSETS ACQUIRED AND LIABILITIES ASSUMED Fair Value Assets Acquired: Current assets $ 36,232,526 Equity method investments 10,861,111 Identifiable intangible assets 6,515,000 Fixed Assets and other non-current assets 2,367,272 Liabilities Assumed: Current liabilities (27,326,110 ) Other long-term liabilities (327,861 ) Non-Controlling Interest (3,558,263 ) Goodwill 3,986,325 Purchase Price $ 28,750,000 |
SCHEDULE OF IDENTIFIABLE INTANGIBLE ASSETS AND AMORTIZATION PERIOD | Identifiable intangible assets and their amortization periods are estimated as follows: SCHEDULE OF IDENTIFIABLE INTANGIBLE ASSETS AND AMORTIZATION PERIOD Cost Basis Useful Life Customer relationships $ 6,292,000 7 Non-compete agreements 223, 000 1 $ 6,515,000 |
AMORTIZATION OF INTANGIBLE ASSETS | Amortization of intangible assets was immaterial for the period from the acquisition date to the end of the reporting period February 28, 2023. The future amortization schedule is as follows: AMORTIZATION OF INTANGIBLE ASSETS 2024 $ 1,121,857 For the Twelve Months Ending February 28, 2024 $ 1,121,857 2025 898,857 2026 898,857 2027 898,857 2028 898,857 Thereafter 1,797,715 Total. $ 6,515,000 |
SCHEDULE OF FINANCIAL INFORMATION AT FAIR VALUE FOR EQUITY METHOD INVESTMENT | SCHEDULE OF FINANCIAL INFORMATION AT FAIR VALUE FOR EQUITY METHOD INVESTMENT The following summarizes financial information at fair value for the equity-method investments at the acquisition: Fair Value Current assets $ 17,493,164 Noncurrent assets 152,658 Total Assets 17,645,822 Current liabilities 6,907,904 Noncurrent liabilities - Total liabilities 6,907,904 Net assets of the equity investee 10,737,918 Equity attributable to non-controlling interest (5,368,959 ) Equity attributable to registrant 5,368,959 Equity goodwill attributable to registrant 5,492,152 Total Equity method investment $ 10,861,111 |
SCHEDULE OF PRO FORMA INFORMATION | SCHEDULE OF PRO FORMA INFORMATION Three Months Ended February 28, 2022 Nine Months Ended February 28, 2022 Revenue, net $ 339,213,905 $ 1,040,963,776 Net Income attributable to registrant 1,030,332 18,653,614 Weighted average shares of common stock outstanding, basic and diluted (as previously reported) 655,781,078 582,680,746 Net income per share, basic and diluted $ - $ 0.03 |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 9 Months Ended |
Feb. 28, 2023 | |
Payables and Accruals [Abstract] | |
SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | Accrued expenses and other current liabilities consisted of the following on February 28, 2023, and May 31, 2022: SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES February 28, 2023 May 31, 2022 Accrued salaries and related expenses $ 2,519,124 $ 625,000 Accrued sales and marketing expense 1,173,564 2,383,500 Accrued professional fees 1,805,259 1,350,170 Accrued income tax 2,713,523 559,544 Accrued overdraft liabilities 1,156,708 681,058 Other accrued expenses and current liabilities 810,679 66,887 Accrued expenses and other current liabilities $ 10,178,857 $ 5,666,159 |
FINANCING ARRANGEMENTS (Tables)
FINANCING ARRANGEMENTS (Tables) | 9 Months Ended |
Feb. 28, 2023 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF FINANCING ARRANGEMENT | Financing arrangements on the consolidated balance sheets consists of: SCHEDULE OF FINANCING ARRANGEMENT February 28, 2023 May 31, 2022 Revolving Credit Facility $ 9,882,529 $ 38,141,451 Current portion of notes payable 17,804,500 608,333 Notes payable, gross 27,687,029 38,749,784 Noncurrent portion of notes payable 1,500,000 - Long term, notes payable $ 29,187,029 $ 38,749,784 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Feb. 28, 2023 | |
Related Party Transactions [Abstract] | |
SCHEDULE OF RELATED PARTY TRANSACTION | The Company has the following debt due to related parties: SCHEDULE OF RELATED PARTY TRANSACTION February 28, 2023 May 31, 2022 Due to Frangipani Trade Services (1) $ 451,964 $ 602,618 Due to employee (2) 7,500 30,000 Due to employee (3) 16,661 66,658 476,124 699,276 Less: current portion (325,478 ) (301,308 ) $ 150,655 $ 397,968 (1) Due to Frangipani Trade Services (“FTS”), an entity owned by the Company’s CEO, is due on demand and is non-interest bearing. The principal amount of this Promissory Note bears no interest provided that any amount due under this Note which is not paid when due shall bear interest at an interest rate equal to six percent ( 6 150,655 (2) On May 29, 2020, the Company entered into a $ 90,000 2,500 (3) On May 29, 2020, the Company entered into a $ 200,000 5,556 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 9 Months Ended |
Feb. 28, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
SCHEDULE OF COMPONENTS OF LEASE EXPENSE | The components of lease expense were as follows: SCHEDULE OF COMPONENTS OF LEASE EXPENSE For the For the February 28, 2023 February 28, 2022 Operating lease $ 531,728 $ 310,965 Interest on lease liabilities 202,885 16,910 Total net lease cost $ 734,613 $ 327,875 For the For the February 28, 2023 February 28, 2022 Operating lease $ 1,269,299 $ 1,103,649 Interest on lease liabilities 363,398 104,242 Total net lease cost $ 1,632,697 $ 1,207,891 |
SCHEDULE OF SUPPLEMENT BALANCE SHEET INFORMATION | Supplemental balance sheet information related to leases was as follows: SCHEDULE OF SUPPLEMENT BALANCE SHEET INFORMATION February 28, 2023 May 31, 2022 Operating leases: Operating lease ROU assets – net $ 10,931,331 $ 2,408,098 Current operating lease liabilities, included in current liabilities 2,422,306 912,618 Noncurrent operating lease liabilities, included in long-term liabilities 8,813,569 1,593,873 Total operating lease liabilities $ 11,235,875 $ 2,506,491 |
SCHEDULE OF SUPPLEMENTAL CASH FLOW AND OTHER INFORMATION RELATED TO LEASES | Supplemental cash flow and other information related to leases was as follows: SCHEDULE OF SUPPLEMENTAL CASH FLOW AND OTHER INFORMATION RELATED TO LEASES For Nine Months For Nine Months Ended Ended February 28, 2023 February 28, 2022 ROU assets obtained in exchange for lease liabilities: Operating leases $ 8,897,639 $ 1,098,769 Weighted average remaining lease term (in years): Operating leases 4.60 3.98 Weighted average discount rate: Operating leases 8.57 % 4.25 % |
SCHEDULE OF MINIMUM LEASE PAYMENTS | As of February 28, 2023, future minimum lease payments under noncancelable operating leases are as follows: SCHEDULE OF MINIMUM LEASE PAYMENTS For the Twelve Months Ending February 28, 2024 $ 3,281,807 2025 3,024,640 2026 2,660,969 2027 2,537,799 2028 1,978,600 Thereafter 131,485 Total lease payments 13,615,299 Less: imputed interest (2,379,424 ) Total lease obligations $ 11,235,875 |
INCOME TAX PROVISION (Tables)
INCOME TAX PROVISION (Tables) | 9 Months Ended |
Feb. 28, 2023 | |
Income Tax Disclosure [Abstract] | |
SCHEDULE OF INCOME TAX EXPENSE | The income tax provision consists of the following: SCHEDULE OF INCOME TAX EXPENSE For the For the Three Month Ended February 28, 2022 Federal provision (benefit) Current $ (134,755 ) $ (93,752 ) Deferred (135,654 ) 343,363 Foreign 10,299 - State and Local provision (benefit) Current (542,436 ) (81,039 ) Deferred (11,534 ) 59,635 Total provision $ (814,080 ) $ 228,207 For the For the Nine Month Ended February 28, 2022 Federal provision (benefit) Current $ 1,194,842 $ 2,294,248 Deferred (188,613 ) 83,784 Foreign 10,299 - State and Local provision (benefit) Current (138,956 ) 371,961 Deferred (27,605 ) 15,214 Total provision $ 849,967 $ 2,765,207 |
SCHEDULE OF DEFERRED TAX ASSETS (LIABILITIES) | The Company’s deferred tax assets (liabilities) consisted of the effects of temporary differences attributable to the following: SCHEDULE OF DEFERRED TAX ASSETS (LIABILITIES) Deferred Tax Assets February 28, 2023 May 31, 2022 Allowance for doubtful accounts $ 694,532 $ 733,139 Consulting contract liability 218,137 230,263 Lease liability 2,512,188 659,460 Other 548,364 238,006 Total deferred tax assets 3,973,221 1,860,868 Deferred Tax Liabilities Operating lease right-of-use assets $ (2,418,863 ) $ (631,173 ) Goodwill and intangibles (321,736 ) (256,533 ) Fixed assets (39,012 ) (30,414 ) Net deferred tax asset $ 1,193,610 $ 942,748 |
SCHEDULE OF EXPECTED TAX EXPENSE (BENEFIT) | The expected tax expense (benefit) based on the statutory rate is reconciled with actual tax expense benefit as follows: SCHEDULE OF EXPECTED TAX EXPENSE (BENEFIT) For the Nine Months Ended February 28, 2023 For the Nine Months Ended February 28, 2022 US Federal statutory rate 21.0 - % 21.0 % State income tax, net of federal benefit 2.0 % 9 % Foreign income taxes and adjustments 0.6 % - % Prior year provision adjustment to actual (6.3 )% - % FDII deduction (6.7 )% - % Change in valuation allowance - (3.0 )% Other permanent differences, net (0.1 )% 1.0 % Income tax provision 10.5 % 28.0 % |
SUBSEQUENT EVENTS (Tables)
SUBSEQUENT EVENTS (Tables) | 9 Months Ended |
Feb. 28, 2023 | |
Subsequent Events [Abstract] | |
SCHEDULE OF PROMISSORY NOTES DUE | SCHEDULE OF PROMISSORY NOTES DUE Promissory Notes Due 3/7/2023 Note 1 to ULHL $ 4,500,000 15.0 % 4/7/2023 Note 2 to ULHL 5,000,000 15.0 % 6/30/2023 Note 3 to ULHL 500,000 15.0 % Total: $ 10,000,000 |
SCHEDULE OF DERIVATIVE LIABILIT
SCHEDULE OF DERIVATIVE LIABILITIES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Change in fair value | $ 64,955 | $ (4,275,986) | $ 809,611 | $ (4,275,986) |
Fair Value, Inputs, Level 1 [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Derivative liabilities as May 31, 2022 | ||||
Addition | ||||
Change in fair value | ||||
Derivative liabilities as February 28, 2023 | ||||
Fair Value, Inputs, Level 2 [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Derivative liabilities as May 31, 2022 | ||||
Addition | ||||
Change in fair value | ||||
Derivative liabilities as February 28, 2023 | ||||
Fair Value, Inputs, Level 3 [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Derivative liabilities as May 31, 2022 | 12,437,994 | |||
Addition | ||||
Change in fair value | (809,611) | |||
Derivative liabilities as February 28, 2023 | $ 11,628,383 | $ 11,628,383 |
SCHEDULE OF FAIR VALUE ASSUMPTI
SCHEDULE OF FAIR VALUE ASSUMPTION (Details) $ / shares in Units, $ in Millions | 9 Months Ended | 12 Months Ended |
Feb. 28, 2023 USD ($) $ / shares | May 31, 2022 USD ($) $ / shares | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Estimated capital raise | $ | $ 39 | |
Estimated value of common stock | $ / shares | $ 10 | |
Estimated time to financing event | 3 months | 6 months |
Measurement Input, Risk Free Interest Rate [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Probability of financing event or capital raise | 5 | 1.60 |
Measurement Input Probability Of Probability Of Financing Event [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Probability of financing event or capital raise | 90 | 50 |
SCHEDULE OF CHANGES IN CONTRACT
SCHEDULE OF CHANGES IN CONTRACT ASSET AND CONTRACT LIABILITY (Details) - USD ($) | 9 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Accounting Policies [Abstract] | ||
Contract assets increase (decrease) reclassification of the beginning contract liabilities to revenue, as the result of performance obligation satisfied | ||
Contract liabilities (increase) decrease reclassification of the beginning contract liabilities to revenue, as the result of performance obligation satisfied | 468,209 | |
Contract assets increase (decrease) cash received in advance and not recognized as revenue | ||
Contract liabilities (increase) decrease cash received in advance and not recognized as revenue | (358,365) | |
Contract assets increase (decrease) reclassification of the beginning contract assets to receivables, as the result of rights to consideration becoming unconditional | (39,978,761) | |
Contract liabilities (increase) decrease reclassification of the beginning contract assets to receivables, as the result of rights to consideration becoming unconditional | ||
Contract assets recognized | 12,867,742 | |
Contract assets recognized | ||
Contract assets increase (decrease) net change | (27,111,019) | |
Increase (Decrease) in Contract with Customer, Liability | $ 109,844 | $ (10,403,335) |
SCHEDULE OF DISAGGREGATION OF R
SCHEDULE OF DISAGGREGATION OF REVENUE (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | |
Total revenue | $ 49,627,502 | $ 250,435,895 | $ 274,973,607 | $ 845,638,444 |
China Hong Kong Taiwan [Member] | ||||
Total revenue | 17,427,833 | 82,006,657 | 123,977,602 | 285,424,103 |
Southeast Asia [Member] | ||||
Total revenue | 9,335,793 | 121,340,162 | 72,449,913 | 361,600,180 |
UNITED STATES | ||||
Total revenue | 8,022,489 | 5,049,985 | 29,699,664 | 28,254,253 |
INDIA | ||||
Total revenue | 8,602,665 | 34,943,595 | 37,919,338 | 134,393,170 |
Other [Member] | ||||
Total revenue | $ 6,238,722 | $ 7,095,496 | $ 10,927,090 | $ 35,966,738 |
SCHEDULE OF EARNING PER SHARE (
SCHEDULE OF EARNING PER SHARE (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net income (loss) attributable to common stockholders | $ 663,173 | $ (9,496,311) | ||
Effect of dilutive securities: | ||||
Diluted net income (loss) | $ 663,173 | $ (9,496,311) | ||
Weighted average common shares outstanding – basic | 799,141,770 | 655,781,078 | ||
Series A Preferred | $ 1,168,177,320 | |||
Series B Preferred | 5,373,342,576 | |||
Series C Preferred | 1,206,351,359 | |||
Series D Preferred | $ 1,130,954,399 | |||
Weighted average common shares outstanding and assumed conversion – diluted | 9,677,967,424 | 655,781,078 | ||
Earnings Per Share, Basic | $ (0.01) | $ 0.01 | $ (0.01) | |
Earnings Per Share, Diluted | (0.01) | $ (0.01) | ||
Share Issuance Arrangement And Stock Option Or Warrants [Member] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Net income (loss) attributable to common stockholders | $ 7,256,211 | $ (2,984,670) | ||
Effect of dilutive securities: | ||||
Diluted net income (loss) | $ 7,256,211 | $ (2,984,670) | ||
Weighted average common shares outstanding – basic | 780,768,778 | 582,680,746 | ||
Series A Preferred | $ 1,168,177,320 | |||
Series B Preferred | 5,373,342,576 | |||
Series C Preferred | 1,206,351,359 | |||
Series D Preferred | $ 1,130,954,399 | |||
Earnings Per Share, Basic | $ (0.01) | |||
Earnings Per Share, Diluted | ||||
Weighted average common shares outstanding and assumed conversion – diluted | 9,659,594,432 | 582,680,746 |
NATURE OF BUSINESS AND SUMMAR_4
NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Mar. 10, 2023 | Feb. 28, 2023 | Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | May 31, 2022 | May 31, 2023 | Feb. 21, 2023 | Dec. 31, 2022 | |
Product Information [Line Items] | ||||||||||
Negative working capital | $ 9,700,000 | $ 9,700,000 | $ 9,700,000 | |||||||
Negative working capital | (9,700,000) | (9,700,000) | (9,700,000) | |||||||
Cash | $ 3,500,000 | |||||||||
Convertible Notes Payable, Current | 23,800,000 | |||||||||
Non current liabilities | 1,500,000 | |||||||||
Goodwill, Acquired During Period | 3,800,000 | |||||||||
Payments to Acquire Intangible Assets | 6,500,000 | |||||||||
Payments to Acquire Equity Method Investments | 10,900,000 | |||||||||
Current liabilities | 23,800,000 | 23,800,000 | 23,800,000 | |||||||
Promissory notes | 10,000,000 | 10,000,000 | 10,000,000 | |||||||
Debt instrument, face amount | $ 10,000,000 | |||||||||
Line of credit | $ 47,500,000 | |||||||||
Allowance for doubtful accounts | $ 1,700,000 | 1,700,000 | 1,700,000 | |||||||
Derivative liabilities | $ 64,955 | $ (4,275,986) | $ 809,611 | $ (4,275,986) | ||||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | Three Major Customers [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Concentration risk percentage | 18% | 13% | 21% | |||||||
Accounts Receivable [Member] | Customer Concentration Risk [Member] | No Customers [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Concentration risk percentage | 10% | 10% | ||||||||
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Three Major Customers [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Concentration risk percentage | 50% | 20% | 52% | |||||||
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | No Customers [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Concentration risk percentage | 10% | |||||||||
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Customer A [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Concentration risk percentage | 39% | 38% | ||||||||
Revenue from Contract with Customer Benchmark [Member] | Customer Concentration Risk [Member] | Customer B and C [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Concentration risk percentage | 10% | |||||||||
Maximum [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Debt instrument, face amount | $ 35,000,000 | |||||||||
Subsequent Event [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Negative working capital | $ (4,200,000) | |||||||||
Negative working capital | 4,200,000 | |||||||||
Debt instrument, face amount | $ 4,210,526.32 | |||||||||
Allowance for doubtful accounts | $ 2,700,000 | |||||||||
Subsequent Event [Member] | Edify Acquisition Corp [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Proceeds from Notes Payable | 9,000,000 | |||||||||
Subsequent Event [Member] | Maximum [Member] | ||||||||||
Product Information [Line Items] | ||||||||||
Debt instrument, face amount | $ 14,789,473.68 |
Schedule Of Acquired Subsidiary
Schedule Of Acquired Subsidiary (Details) | Feb. 21, 2023 |
Unique Logistics International HK Limited [Member] | |
Equity method investment ownership percentage | 100% |
Unique Logistics International Vietnam Co Ltd [Member] | |
Equity method investment ownership percentage | 65% |
ULI South China Limited [Member] | |
Equity method investment ownership percentage | 70% |
Unique Logistics International South China Limited [Member] | |
Equity method investment ownership percentage | 70% |
Unique Logistics International India Private Ltd [Member] | |
Equity method investment ownership percentage | 65% |
ULI North And East China Company Limited [Member] | |
Equity method investment ownership percentage | 50% |
Unique Logistics International Co [Member] | |
Equity method investment ownership percentage | 50% |
TGF Unique Limited [Member] | |
Equity method investment ownership percentage | 49.99% |
SCHEDULE OF BUSINESS COMBINATIO
SCHEDULE OF BUSINESS COMBINATION CONTINGENT CONSIDERATION (Details) - USD ($) | Feb. 21, 2023 | Feb. 28, 2023 |
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | $ 10,000,000 | |
Promissory Notes One Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 4,500,000 | |
Promissory Notes Two [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 5,000,000 | |
Promissory Notes Three [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 5,000,000 | |
Promissory Notes Four [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 1,000,000 | |
Promissory Notes Five [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 500,000 | |
Promissory Notes Six [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 2,000,000 | |
Promissory Notes Seven [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 1,000,000 | |
Promissory Notes Eight [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 2,500,000 | |
Promissory Notes Nine [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | 2,000,000 | |
Unique Logistics Holdings Limited [Member] | ||
Business Acquisition [Line Items] | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents | 3,500,000 | |
Business Combination, Consideration Transferred, Other | 6,250,000 | |
Business Combination, Price of Acquisition, Expected | $ 28,750,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes One Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 3/7/2023 | |
Business Acquisition, Description of Acquired Entity | Note 1 to ULHL | |
Debt Instrument, Interest Rate During Period | 15% | |
Debt Instrument, Face Amount | $ 4,500,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes Two [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 4/7/2023 | |
Business Acquisition, Description of Acquired Entity | Note 2 to ULHL | |
Debt Instrument, Interest Rate During Period | 15% | |
Debt Instrument, Face Amount | $ 5,000,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes Three [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 6/30/2023 | |
Business Acquisition, Description of Acquired Entity | Note 3 to ULHL | |
Debt Instrument, Interest Rate During Period | 15% | |
Debt Instrument, Face Amount | $ 5,000,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes Four [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 2/21/2025 | |
Business Acquisition, Description of Acquired Entity | Note 4 to ULHL | |
Debt Instrument, Interest Rate During Period | ||
Debt Instrument, Face Amount | $ 1,000,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes Six [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 6/30/2023 | |
Business Acquisition, Description of Acquired Entity | Note 6 to ULHL | |
Debt Instrument, Interest Rate During Period | ||
Debt Instrument, Face Amount | $ 2,000,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes Seven [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 6/30/2023 | |
Business Acquisition, Description of Acquired Entity | Note 7 to ULHL | |
Debt Instrument, Interest Rate During Period | ||
Debt Instrument, Face Amount | $ 1,000,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Face Amount | $ 19,000,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes Eight [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 6/30/2023 | |
Business Acquisition, Description of Acquired Entity | Note 8 to ULHL | |
Debt Instrument, Interest Rate During Period | 15% | |
Debt Instrument, Face Amount | $ 2,500,000 | |
Unique Logistics Holdings Limited [Member] | Promissory Notes Nine [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 2/21/2024 | |
Business Acquisition, Description of Acquired Entity | Note 9 to ULHL | |
Debt Instrument, Interest Rate During Period | ||
Debt Instrument, Face Amount | $ 2,000,000 | |
Unique Logistics Holdings Limited [Member] | Earnout Payment [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 2/21/2024 | |
Business Acquisition, Description of Acquired Entity | Earnout payment (estimated) | |
Debt Instrument, Interest Rate During Period | ||
Debt Instrument, Face Amount | $ 1,750,000 | $ 1,750,000 |
Frangipani Trade Services Inc [Member] | Promissory Notes Five [Member] | ||
Business Acquisition [Line Items] | ||
Debt Instrument, Maturity Date, Description | 2/21/2025 | |
Business Acquisition, Description of Acquired Entity | Note 5 to FTS | |
Debt Instrument, Interest Rate During Period | ||
Debt Instrument, Face Amount | $ 500,000 |
SCHEDULE OF FAIR VALUE OF ASSET
SCHEDULE OF FAIR VALUE OF ASSETS ACQUIRED AND LIABILITIES ASSUMED (Details) - USD ($) | Feb. 28, 2023 | Feb. 21, 2023 | May 31, 2022 |
Business Acquisition [Line Items] | |||
Current liabilities | $ (23,800,000) | ||
Goodwill | $ 8,449,454 | $ 4,463,129 | |
Unique Logistics Holdings Limited [Member] | |||
Business Acquisition [Line Items] | |||
Current assets | $ 36,232,526 | ||
Equity method investments | 10,861,111 | ||
Identifiable intangible assets | 6,515,000 | ||
Fixed Assets and other non-current assets | 2,367,272 | ||
Current liabilities | (27,326,110) | ||
Other long-term liabilities | (327,861) | ||
Non-Controlling Interest | (3,558,263) | ||
Goodwill | 3,986,325 | ||
Purchase Price | $ 28,750,000 |
SCHEDULE OF IDENTIFIABLE INTANG
SCHEDULE OF IDENTIFIABLE INTANGIBLE ASSETS AND AMORTIZATION PERIOD (Details) | Feb. 21, 2023 USD ($) |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Identifiable intangible assets | $ 6,515,000 |
Customer Relationships [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Identifiable intangible assets | $ 6,292,000 |
Identifiable intangible assets useful life | 7 years |
Noncompete Agreements [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Identifiable intangible assets | $ 223 |
Identifiable intangible assets useful life | 1 year |
AMORTIZATION OF INTANGIBLE ASSE
AMORTIZATION OF INTANGIBLE ASSETS (Details) - Unique Logistics Holdings Limited [Member] | Feb. 28, 2023 USD ($) |
Business Acquisition [Line Items] | |
2024 | $ 1,121,857 |
2025 | 898,857 |
2026 | 898,857 |
2027 | 898,857 |
2028 | 898,857 |
Thereafter | 1,797,715 |
Total. | $ 6,515,000 |
SCHEDULE OF FINANCIAL INFORMATI
SCHEDULE OF FINANCIAL INFORMATION AT FAIR VALUE FOR EQUITY METHOD INVESTMENT (Details) - USD ($) | Feb. 28, 2023 | Feb. 21, 2023 | Nov. 30, 2022 | Aug. 31, 2022 | May 31, 2022 | Feb. 28, 2022 | Nov. 30, 2021 | Aug. 31, 2021 | May 31, 2021 |
Business Combination and Asset Acquisition [Abstract] | |||||||||
Current assets | $ 62,470,090 | $ 17,493,164 | $ 108,543,031 | ||||||
Noncurrent assets | 152,658 | ||||||||
Total Assets | 110,941,114 | 17,645,822 | 124,911,935 | ||||||
Current liabilities | 72,201,695 | 6,907,904 | 104,367,590 | ||||||
Noncurrent liabilities | 22,092,607 | 14,712,501 | |||||||
Total liabilities | 94,294,302 | 6,907,904 | 119,080,091 | ||||||
Net assets of the equity investee | 13,088,055 | 10,737,918 | $ 12,424,882 | 5,831,844 | $ 3,878,345 | $ 13,374,656 | $ 8,792,058 | $ 6,618,084 | |
Equity attributable to non-controlling interest | (5,368,959) | ||||||||
Equity attributable to registrant | 16,646,812 | 5,368,959 | $ 9,153,185 | 5,831,844 | |||||
Equity goodwill attributable to registrant | 5,492,152 | ||||||||
Total Equity method investment | $ 10,861,111 | $ 10,861,111 |
SCHEDULE OF PRO FORMA INFORMATI
SCHEDULE OF PRO FORMA INFORMATION (Details) - USD ($) | 3 Months Ended | 9 Months Ended |
Feb. 28, 2022 | Feb. 28, 2022 | |
Business Combination and Asset Acquisition [Abstract] | ||
Revenue, net | $ 339,213,905 | $ 1,040,963,776 |
Net Income attributable to registrant | $ 1,030,332 | $ 18,653,614 |
Weighted average shares of common stock outstanding, basic and diluted (as previously reported) | $ 655,781,078 | $ 582,680,746 |
Net income per share, basic and diluted | $ 0.03 |
ACQUISITIONS AND EQUITY METHO_3
ACQUISITIONS AND EQUITY METHOD INVESTMENTS (Details Narrative) - USD ($) | Feb. 21, 2023 | Feb. 28, 2023 | Dec. 31, 2022 | May 31, 2022 |
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 10,000,000 | |||
Other Liabilities, Current | $ 5,710,057 | |||
Equity method investments | 5,492,152 | |||
Goodwill | 8,449,454 | $ 4,463,129 | ||
Maximum [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 35,000,000 | |||
Promissory Notes One Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 4,500,000 | |||
Debt instrument maturity date | Mar. 07, 2023 | |||
Debt instrument interest rate | 15% | |||
Promissory Notes Two [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 5,000,000 | |||
Debt instrument maturity date | Apr. 07, 2023 | |||
Debt instrument interest rate | 15% | |||
Promissory Notes Three [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 5,000,000 | |||
Debt instrument maturity date | Jun. 30, 2023 | |||
Debt instrument interest rate | 15% | |||
Promissory Notes Four [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 1,000,000 | |||
Debt instrument maturity date | Feb. 21, 2025 | |||
Promissory Notes Five [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 500,000 | |||
Debt instrument maturity date | Feb. 21, 2025 | |||
Debt instrument interest rate | 35% | |||
Promissory Notes Six [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 2,000,000 | |||
Debt instrument maturity date | Jun. 30, 2023 | |||
Promissory Notes Seven [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 1,000,000 | |||
Debt instrument maturity date | Jun. 30, 2023 | |||
Promissory Notes Eight [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 2,500,000 | |||
Debt instrument maturity date | Jun. 30, 2023 | |||
Debt instrument interest rate | 15% | |||
Promissory Notes Nine [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 2,000,000 | |||
Debt instrument maturity date | Feb. 21, 2024 | |||
Unique Logistics Holdings Limited [Member] | ||||
Business Acquisition [Line Items] | ||||
Business combination consideration transferred, gross | $ 28,800,000 | |||
Business combination consideration transferred, net | 15,500,000 | |||
Business combination, contingent consideration | 2,500,000 | |||
Business combination, minimum contingent consideration | 2,000,000 | |||
Business combination, high contingent consideration | 4,500,000 | |||
Equity method investments and goodwill | 9,478,477 | |||
Equity method investments | 5,492,152 | |||
Goodwill | 3,986,325 | |||
Business acquisition cost | 500,000 | |||
Unique Logistics Holdings Limited [Member] | Maximum [Member] | ||||
Business Acquisition [Line Items] | ||||
Business combination, contingent consideration | 5,000,000 | |||
Business combination, high contingent consideration | 5,000,000 | |||
Unique Logistics Holdings Limited [Member] | Promissory Notes One Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | 4,500,000 | |||
Unique Logistics Holdings Limited [Member] | Promissory Notes Two [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | 5,000,000 | |||
Unique Logistics Holdings Limited [Member] | Promissory Notes Three [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | 5,000,000 | |||
Unique Logistics Holdings Limited [Member] | Promissory Notes Four [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | 1,000,000 | |||
Unique Logistics Holdings Limited [Member] | Promissory Notes Six [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | 2,000,000 | |||
Unique Logistics Holdings Limited [Member] | Promissory Notes Seven [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | 1,000,000 | |||
Unique Logistics Holdings Limited [Member] | Promissory Notes Eight [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | 2,500,000 | |||
Unique Logistics Holdings Limited [Member] | Promissory Notes Nine [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | 2,000,000 | |||
Unique Logistics Holdings Limited [Member] | Earnout Payment [Member] | ||||
Business Acquisition [Line Items] | ||||
Debt instrument face amount | $ 1,750,000 | $ 1,750,000 | ||
Debt instrument interest rate | 15% | |||
Other Liabilities, Current | $ 5,710,057 |
SCHEDULE OF ACCRUED EXPENSES AN
SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) | Feb. 28, 2023 | May 31, 2022 |
Payables and Accruals [Abstract] | ||
Accrued salaries and related expenses | $ 2,519,124 | $ 625,000 |
Accrued sales and marketing expense | 1,173,564 | 2,383,500 |
Accrued professional fees | 1,805,259 | 1,350,170 |
Accrued income tax | 2,713,523 | 559,544 |
Accrued overdraft liabilities | 1,156,708 | 681,058 |
Other accrued expenses and current liabilities | 810,679 | 66,887 |
Accrued expenses and other current liabilities | $ 10,178,857 | $ 5,666,159 |
SCHEDULE OF FINANCING ARRANGEME
SCHEDULE OF FINANCING ARRANGEMENT (Details) - USD ($) | Feb. 28, 2023 | May 31, 2022 |
Debt Disclosure [Abstract] | ||
Revolving Credit Facility | $ 9,882,529 | $ 38,141,451 |
Current portion of notes payable | 17,804,500 | 608,333 |
Notes payable, gross | 27,687,029 | 38,749,784 |
Noncurrent portion of notes payable | 1,500,000 | |
Long term, notes payable | $ 29,187,029 | $ 38,749,784 |
FINANCING ARRANGEMENTS (Details
FINANCING ARRANGEMENTS (Details Narrative) - USD ($) | May 29, 2020 | Feb. 28, 2023 | Feb. 21, 2023 | May 31, 2022 | Jun. 02, 2021 |
Short-Term Debt [Line Items] | |||||
Notes payable current | $ 17,804,500 | $ 608,333 | |||
Notes payable non current | 1,500,000 | ||||
Notes Payable [Member] | UL ATL [Member] | |||||
Short-Term Debt [Line Items] | |||||
Notes payable | $ 1,825,000 | $ 304,167 | $ 608,333 | ||
Debt, maturity date | May 29, 2023 | ||||
Notes Payable Current [Member] | Convertible Notes Payable [Member] | |||||
Short-Term Debt [Line Items] | |||||
Notes payable | $ 19 | ||||
Notes payable current | 17,500,000 | ||||
Notes payable non current | $ 1,500,000 | ||||
Non Compete Non Solicitation Non Disclosure Agreement [Member] | Notes Payable [Member] | ATL [Member] | |||||
Short-Term Debt [Line Items] | |||||
Debt, periodic payment description | The agreement calls for six semi-annual payments of $304,167, for which the first payment was due on November 29, 2020. | ||||
Debt, periodic payments | $ 304,167 | ||||
Minimum [Member] | TBK Agreement [Member] | |||||
Short-Term Debt [Line Items] | |||||
Line of credit | $ 47,500,000 | ||||
Maximum [Member] | TBK Agreement [Member] | |||||
Short-Term Debt [Line Items] | |||||
Line of credit | $ 57,500,000 |
SCHEDULE OF RELATED PARTY TRANS
SCHEDULE OF RELATED PARTY TRANSACTION (Details) - USD ($) | Feb. 28, 2023 | May 31, 2022 | |
Related Party Transaction [Line Items] | |||
Due to related parties, gross | $ 476,124 | $ 699,276 | |
Less: current portion | (325,478) | (301,308) | |
Long term, due to related parties | 150,655 | 397,968 | |
Due to Frangipani Trade Services [Member] | |||
Related Party Transaction [Line Items] | |||
Due to related parties, gross | [1] | 451,964 | 602,618 |
Due to Employee One [Member] | |||
Related Party Transaction [Line Items] | |||
Due to related parties, gross | [2] | 7,500 | 30,000 |
Due to Employee [Member] | |||
Related Party Transaction [Line Items] | |||
Due to related parties, gross | [3] | $ 16,661 | $ 66,658 |
[1]Due to Frangipani Trade Services (“FTS”), an entity owned by the Company’s CEO, is due on demand and is non-interest bearing. The principal amount of this Promissory Note bears no interest provided that any amount due under this Note which is not paid when due shall bear interest at an interest rate equal to six percent ( 6 150,655 90,000 2,500 200,000 5,556 |
SCHEDULE OF RELATED PARTY TRA_2
SCHEDULE OF RELATED PARTY TRANSACTIONS (Details) (Parenthetical) - USD ($) | 6 Months Ended | |
May 29, 2020 | Nov. 30, 2021 | |
Due to Frangipani Trade Services [Member] | ||
Related Party Transaction [Line Items] | ||
Debt, interest rate | 6% | |
Debt, periodic payments | $ 150,655 | |
Due to Employee [Member] | ||
Related Party Transaction [Line Items] | ||
Debt, periodic payments | $ 2,500 | |
Notes payable | 90,000 | |
Due to Employee One [Member] | ||
Related Party Transaction [Line Items] | ||
Debt, periodic payments | 5,556 | |
Notes payable | $ 200,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | May 31, 2022 | |
Related Party Transactions [Abstract] | |||||
Accounts receivable, trade related parties | $ 7.2 | $ 7.2 | $ 3 | ||
Accounts payable, trade related parties | 10.8 | 10.8 | $ 15.2 | ||
Revenue from related party transactions | 6.4 | $ 1.2 | 5.5 | $ 1.9 | |
Direct operating costs | $ 4.5 | $ 13.1 | $ 32.5 | $ 39 |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Feb. 28, 2022 | Feb. 28, 2023 | Nov. 30, 2021 | Aug. 31, 2021 | Feb. 28, 2023 | May 31, 2022 | |
Class of Stock [Line Items] | ||||||
Common stock, shares authorized | 800,000,000 | 800,000,000 | 800,000,000 | |||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Issuance of common stock | $ 0 | $ 0 | ||||
Preferred Stock, Shares Authorized | 5,000,000 | 5,000,000 | 5,000,000 | |||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Series A Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Convertible preferred stock, shares | 9,935 | 9,935 | ||||
Common Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Convertible preferred stock, shares | 67,963,732 | 67,963,732 | ||||
Conversion of convertible securities | 52,534,319 | 83,811,872 | ||||
Conversion of stock, shares | 43,981,560 | |||||
Series A Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | 0.001 | |||
Series B Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | 0.001 | |||
Stock issued during period shares new issues | 125,692,224 | |||||
Series B Convertible Preferred Stock [Member] | Chief Executive Officer [Member] | ||||||
Class of Stock [Line Items] | ||||||
Conversion of convertible securities | 19,200 | |||||
Debt instrument interest rate stated percentage | 100% | 100% | ||||
Series D Convertible Preferred Stock [Member] | ||||||
Class of Stock [Line Items] | ||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||
Conversion of stock, shares | 7 |
SCHEDULE OF COMPONENTS OF LEASE
SCHEDULE OF COMPONENTS OF LEASE EXPENSE (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | ||||
Operating lease | $ 531,728 | $ 310,965 | $ 1,269,299 | $ 1,103,649 |
Interest on lease liabilities | 202,885 | 16,910 | 363,398 | 104,242 |
Total net lease cost | $ 734,613 | $ 327,875 | $ 1,632,697 | $ 1,207,891 |
SCHEDULE OF SUPPLEMENT BALANCE
SCHEDULE OF SUPPLEMENT BALANCE SHEET INFORMATION (Details) - USD ($) | Feb. 28, 2023 | May 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
Operating lease ROU assets – net | $ 10,931,331 | $ 2,408,098 |
Current operating lease liabilities, included in current liabilities | 2,422,306 | 912,618 |
Noncurrent operating lease liabilities, included in long-term liabilities | 8,813,569 | 1,593,873 |
Total operating lease liabilities | $ 11,235,875 | $ 2,506,491 |
SCHEDULE OF SUPPLEMENTAL CASH F
SCHEDULE OF SUPPLEMENTAL CASH FLOW AND OTHER INFORMATION RELATED TO LEASES (Details) - USD ($) | 9 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | $ 8,897,639 | $ 1,098,769 |
Operating Lease Weighted Average Remaining LeaseTerm | 4 years 7 months 6 days | 3 years 11 months 23 days |
Operating Lease, Weighted Average Discount Rate, Percent | 8.57% | 4.25% |
SCHEDULE OF MINIMUM LEASE PAYME
SCHEDULE OF MINIMUM LEASE PAYMENTS (Details) - USD ($) | Feb. 28, 2023 | May 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
2024 | $ 3,281,807 | |
2025 | 3,024,640 | |
2026 | 2,660,969 | |
2027 | 2,537,799 | |
2028 | 1,978,600 | |
Thereafter | 131,485 | |
Total lease payments | 13,615,299 | |
Less: imputed interest | (2,379,424) | |
Total lease obligations | $ 11,235,875 | $ 2,506,491 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details Narrative) | Feb. 28, 2023 |
Product Liability Contingency [Line Items] | |
Operating lease discount rate | 10% |
CALIFORNIA | |
Product Liability Contingency [Line Items] | |
Lease renewal term | 5 years |
NEW YORK | Maximum [Member] | |
Product Liability Contingency [Line Items] | |
Lease renewal term | 5 years |
NEW YORK | Minimum [Member] | |
Product Liability Contingency [Line Items] | |
Lease renewal term | 3 years |
SCHEDULE OF INCOME TAX EXPENSE
SCHEDULE OF INCOME TAX EXPENSE (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | |
Federal provision (benefit) | ||||
Current | $ (134,755) | $ (93,752) | $ 1,194,842 | $ 2,294,248 |
Deferred | (135,654) | 343,363 | (188,613) | 83,784 |
Foreign | 10,299 | 10,299 | ||
State and Local provision (benefit) | ||||
Current | (542,436) | (81,039) | (138,956) | 371,961 |
Deferred | (11,534) | 59,635 | (27,605) | 15,214 |
Total provision | $ (814,080) | $ 228,207 | $ 849,967 | $ 2,765,207 |
SCHEDULE OF DEFERRED TAX ASSETS
SCHEDULE OF DEFERRED TAX ASSETS (LIABILITIES) (Details) - USD ($) | Feb. 28, 2023 | May 31, 2022 |
Deferred Tax Assets | ||
Allowance for doubtful accounts | $ 694,532 | $ 733,139 |
Consulting contract liability | 218,137 | 230,263 |
Lease liability | 2,512,188 | 659,460 |
Other | 548,364 | 238,006 |
Total deferred tax assets | 3,973,221 | 1,860,868 |
Deferred Tax Liabilities | ||
Operating lease right-of-use assets | (2,418,863) | (631,173) |
Goodwill and intangibles | (321,736) | (256,533) |
Fixed assets | (39,012) | (30,414) |
Net deferred tax asset | $ 1,193,610 | $ 942,748 |
SCHEDULE OF EXPECTED TAX EXPENS
SCHEDULE OF EXPECTED TAX EXPENSE (BENEFIT) (Details) | 9 Months Ended | |
Feb. 28, 2023 | Feb. 28, 2022 | |
Income Tax Disclosure [Abstract] | ||
US Federal statutory rate | 21% | 21% |
State income tax, net of federal benefit | 2% | 9% |
Foreign income taxes and adjustments | 0.60% | |
Prior year provision adjustment to actual | (6.30%) | |
FDII deduction | (6.70%) | |
Change in valuation allowance | (3.00%) | |
Other permanent differences, net | (0.10%) | 1% |
Income tax provision | 10.50% | 28% |
INCOME TAX PROVISION (Details N
INCOME TAX PROVISION (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Feb. 28, 2023 | Feb. 28, 2022 | Feb. 28, 2023 | Feb. 28, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Valuation allowance | $ 0 | $ 0 | $ 0 | $ 0 |
Interest or penalties on unpaid tax | $ 0 | $ 0 |
SCHEDULE OF PROMISSORY NOTES DU
SCHEDULE OF PROMISSORY NOTES DUE (Details) | Feb. 21, 2023 USD ($) |
Short-Term Debt [Line Items] | |
Debt Instrument, Face Amount | $ 10,000,000 |
Promissory Note One [Member] | |
Short-Term Debt [Line Items] | |
Debt Instrument, Maturity Date | Mar. 07, 2023 |
Debt Instrument, Face Amount | $ 4,500,000 |
Debt instrument interest rate | 15% |
Promissory Note Two [Member] | |
Short-Term Debt [Line Items] | |
Debt Instrument, Maturity Date | Apr. 07, 2023 |
Debt Instrument, Face Amount | $ 5,000,000 |
Debt instrument interest rate | 15% |
Promissory Note Three [Member] | |
Short-Term Debt [Line Items] | |
Debt Instrument, Maturity Date | Jun. 30, 2023 |
Debt Instrument, Face Amount | $ 500,000 |
Debt instrument interest rate | 15% |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Mar. 10, 2023 | Feb. 21, 2023 | Dec. 31, 2022 |
Subsequent Event [Line Items] | |||
Debt instrument, face amount | $ 10,000,000 | ||
Maximum [Member] | |||
Subsequent Event [Line Items] | |||
Debt instrument, face amount | $ 35,000,000 | ||
Subsequent Event [Member] | |||
Subsequent Event [Line Items] | |||
Debt instrument, face amount | $ 4,210,526.32 | ||
Subsequent Event [Member] | Maximum [Member] | |||
Subsequent Event [Line Items] | |||
Debt instrument, face amount | $ 14,789,473.68 |