Singing Machine to acquire AI logistics technology company SemiCab

The Singing Machine Company has executed a definitive agreement to acquire SemiCab, an artificial intelligence technology company that optimizes freight for Fortune 1000 clients in the US and Indian markets. SemiCab’s AI technology was developed specifically to build a hyper-efficient trucking network that operates at a 90%+ utilization level, well above the industry standard of 65%. This technology connects thousands of parties on a single network, building fully optimized transit routes that drive costs efficiencies for both the customer and the shipper. SemiCab’s founder and software development team has more than 30 years of experience developing increasingly complex software solutions for the global freight and logistics market. The transaction was structured as an asset purchase/sale. At closing, Singing Machine will issue to SemiCab 952,710 shares of its common stock, which represents approximately 15% of the Company’s issued and outstanding common stock as of June 11, 2024 and the assumption of approximately $2.6 million in liabilities as of March 31, 2024. In addition, at closing Singing Machine will issue to SemiCab a 20% membership interest in its newly formed wholly owned subsidiary, SemiCab Holdings, LLC. The acquisition is subject to various closing conditions, including the Company consummating a capital raise of $1.7 million and other customary closing conditions. As part of the transaction, the Company also entered into an option agreement to acquire SMCB Solutions Private Limited, an Indian based wholly owned subsidiary of SemiCab. This entity currently operates from Bangalore India and serves the combined businesses technology needs as well as India-based enterprise customers. Consideration for this part of the transaction will include an additional 314,485 shares of the Company’s Common Stock. This transaction is expected to close before August 31, 2024, subject to certain regulatory compliance and approvals in India. This subsidiary has generated approximately $1.4 million in sales for the last twelve-month period ended March 31, 2024. These figures are not included in the financial statements filed by the Company in its Form 8-K.