Remark Holdings Corrects Recent Misinformation Campaign by Short Sellers

LAS VEGAS, Aug. 20, 2020 /PRNewswire/ -- Remark Holdings, Inc. (NASDAQ: MARK), a diversified global technology company with leading artificial intelligence ("AI") solutions and digital media properties, today responded to recent inaccurate reports regarding the company's ownership in Sharecare and other issues.

Management Commentary

As we evaluate what further actions we will take, we wanted to take this opportunity to respond to Wolfpack Research's misleading statements and outdated information from last week.

    1. Wolfpack Research's key allegation is that we do not actually own shares
       of Sharecare as we report in our filings with the Securities and Exchange
       Commission. Such assertion is absolutely false. As of June 30, 2020, we
       owned approximately 4.5% of the issued shares of Sharecare and our CEO,
       Kai-Shing Tao, occupies a seat on Sharecare's Board of Directors.
       Additionally, as of this writing, the litigation that we previously
       reported in our SEC filings that could have potentially resulted in our
       loss of control over the investment in Sharecare has been resolved, as we
       recently paid in full all amounts owed in satisfaction of the judgment
       entered into against us during the litigation. Remark never ceased to own
       its approximately 4.5% Sharecare stake, as the ability to settle the
       legal matter without loss of control of the Sharecare investment was
       always under our control. The payment in full of the underlying judgment
       against Remark means that there is no longer any basis for potential
       seizure of the Sharecare investment owned by Remark.

    2. Wolfpack Research alleges that we must not have control of our China
       subsidiaries that we report, for accounting purposes, as variable
       interest entities (VIEs) simply because we did not publicly disclose the
       contents of the contracts that give us control over the VIEs; the
       allegation is simply wrong. We have standard VIE contracts in place,
       including related loan agreements, that were drawn up and executed
       several years ago with the assistance of Arnold & Porter, an
       internationally well regarded law firm. VIE control may not be the same
       as direct equity ownership, but it is a very common framework with
       Chinese companies controlled by foreign entities. In fact, Alibaba,
       Tencent, Netease, and Baidu are some of the many examples of major
       companies who have structured their China business using VIEs.

    3. Though we initially sourced cameras and other components from various
       third parties, including HIKvision (whose cameras are still readily
       available on websites like, we never shared any of our AI
       technology with them nor did HIKvision at any time have access to our
       technology. We are now an original design manufacturer for our thermal
       cameras and thermal pads. We design the cameras and pads and have hired a
       contract manufacturer to produce the products. The manufacturers build
       according to our design and specifications, which is why the products are
       now Remark-branded products. Remark has always maintained control of the
       technology and intellectual property.

    4. Regarding our investment in AIO, we originally planned to invest $1
       million in the company, but after funding $500,000, we determined that we
       would need to work with AIO to improve their results before we further
       funded the company. One of our China subsidiaries subscribed for AIO's
       20% equity interests at a post-money valuation of $5 million, and paid in
       $500,000. In connection with that, AIO increased its registered capital
       from one million Chinese Yuan to 1.25 million Chinese Yuan, and the
       difference between $500,000 and 250,000 Chinese Yuan was deposited to the
       capital surplus account which is not reflected as AIO's registered
       capital. Such transaction is very typical. The comment from Wolfpack
       regarding our China subsidiary's capital contribution based on their
       purported review of the SAIC filing is flawed and seems intended to
       mislead or confuse Remark's investors.

    5. Finally, they allege working capital and cash issues, each of which we
       address in every one of our SEC filings over the past few years, but they
       inaccurately calculate working capital and they do not provide any source
       material, other than referring to obtaining tax documents in China, that
       would allow us refute their inaccurate assertion that we do not
       consolidate our Chinese subsidiaries under GAAP. We are a public company
       with well-regarded auditors who regularly review and audit our
    6. As of June 30, 2020, our cash balance exceeded $10 million and our debt
       had been paid down substantially.

We are proud to be helping our customers safely reopen their businesses and schools as they try to comply with the latest safety standards.

About Remark Holdings, Inc.

Remark Holdings, Inc. (NASDAQ: MARK) delivers an integrated suite of AI solutions that enable businesses and organizations to solve problems, reduce risk and deliver positive outcomes. The company's easy-to-install AI products are being rolled out in a wide range of applications within the retail, financial, public safety and workplace arenas. The company also owns and operates digital media properties that deliver relevant, dynamic content and e-commerce solutions. The company is headquartered in Las Vegas, Nevada, with additional operations in Los Angeles, California and in Beijing, Shanghai, Chengdu and Hangzhou, China. For more information, please visit the company's website at

Forward-Looking Statements

This press release may contain forward-looking statements, including information relating to future events, future financial performance, strategies, expectations, competitive environment and regulation. Words such as "may," "should," "could," "would," "predicts," "potential," "continue," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," and similar expressions, as well as statements in future tense, identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors, including those discussed in Part I, Item 1A. Risk Factors in Remark Holdings' Annual Report on Form 10-K and Remark Holdings' other filings with the SEC. Any forward-looking statements reflect Remark Holdings' current views with respect to future events, are based on assumptions and are subject to risks and uncertainties. Given such uncertainties, you should not place undue reliance on any forward-looking statements, which represent Remark Holdings' estimates and assumptions only as of the date hereof. Except as required by law, Remark Holdings undertakes no obligation to update or revise publicly any forward-looking statements after the date hereof, whether as a result of new information, future events or otherwise.

Company Contact

E. Brian Harvey
Director of Capital Markets and Investor Relations
Remark Holdings, Inc.

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