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Item
4.01
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Changes
in Registrant’s Certifying Accountant.
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(a)
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Previous
Independent Accountants
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On
September 27, 2020, the Company dismissed Prager Metis CPAs, LLC (“Prager”) as the Company’s independent registered
public accounting firm, effective immediately. The audit report of Prager on the Company’s balance sheet as of June 30,
2019 and the related statements of operations, stockholders’ (deficit), and cash flows for the year ended June 30, 2019,
and the related notes (“Audit Period”) did not contain an adverse opinion or a disclaimer of opinion, and was not
qualified or modified as to uncertainty, audit scope or accounting principles, except that the report contained an explanatory
paragraph stating that “As discussed in Note 2 to the financial statements, the Company has had limited revenue and has
an accumulated deficit as of June 30, 2019, which raises substantial doubt about its ability to continue as a going concern. Management’s
plans concerning these matters are also described in Note 2. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.”
The
Company engaged Prager as the Company’s independent registered public accounting firm effective as of April 22, 2019, as
further described in the Current Report on Form 8-K filed by the Company with the Securities and Exchange Commission (“SEC”)
on April 23, 2019.
The
Company’s annual report for the Audit Period does not include an attestation report of Prager regarding internal control
over financial reporting. Management’s report was not subject to attestation by Prager pursuant to Section 989G of the Dodd-Frank
Wall Street Reform and Consumer Protection Act that permits an emerging growth company to provide only management’s report
in the annual report. Therefore, Prager was not engaged to examine management’s assertion about the effectiveness of the
Company’s internal control over financial reporting at June 30, 2019 included in Item 9A of the Company’s Form 10-K
filing.
During
the Audit Period and subsequent interim period through December 31, 2019, there were no disagreements (as defined in Item 304(a)(1)(iv)
of Regulation S-K) with Prager on any matter of accounting principles or practices, financial statement disclosure, or auditing
scope or procedure, which disagreements, if not resolved to the satisfaction of Prager, would have caused Prager to make reference
to the subject matter of the disagreements in its reports.
During
the Audit Period and subsequent interim period through December 31, 2019, there were the following “reportable events”
(as such term is defined in Item 304 of Regulation S-K). As disclosed in Part II, Item 9A of the Company’s Form 10-K for
the year ended June 30, 2019, the Company’s management determined that the Company’s internal controls over financial
reporting were not effective as of the end of such period due to the existence of material weaknesses related to the following:
(i) inadequate segregation of duties and effective risk assessment; and (ii) insufficient written policies and procedures for
accounting and financial reporting with respect to the requirements and application of both US GAAP and SEC guidelines. These
material weaknesses have not been remediated as of the date of this Current Report on Form 8-K. Other than described above, during
the Audit Period and the subsequent interim period through December 31, 2019, there were no reportable events (as defined in Item
304(a)(1)(v) of Regulation S-K).
The
Company has provided Prager with a copy of this report and has requested that Prager furnish the Company with a letter addressed
to the SEC stating whether or not they agree with the statements made above. A copy of Prager’s letter dated September 27,
2020 is attached as Exhibit 16.1 to this amendment to the Original Form 8-K.
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(b)
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New
Independent Accountants
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On
February 20, 2020, Loop engaged Marcum LLP (“Marcum”) to audit Loop’s consolidated financial statements for
the years ended December 31, 2019 and 2018. On February 5, 2020, Loop became a wholly owned subsidiary of the Company in connection
with a reverse acquisition, as further described in the Current Report on Form 8-K filed by the Company with the SEC on February
7, 2020. Subsequently, Loop merged with and into the Company, with the Company as the surviving entity, effective June 9, 2020,
as further described in the Current Report on Form 8-K filed by the Company with the SEC on June 11, 2020.
On
August 10, 2020, the Company appointed Marcum as the Company’s independent registered public accounting firm, effectively
immediately. As such, Marcum will audit the Company’s financial statements for the year ended December 31, 2020, and will
conduct review engagements on the Company’s quarterly financial statements for the quarterly periods ending March 31, June
30 and September 30, 2020, and on an ongoing basis thereafter.
During
the Audit Period and the subsequent interim period through December 31, 2019, neither the Company nor anyone on its behalf consulted
with Marcum with respect to (1) the application of accounting principles to a specified transaction, either completed or proposed,
or the type of audit opinion that might be rendered on the Company’s consolidated financial statements, and neither a written
report was provided to the Company nor oral advice was provided that Marcum concluded was an important factor considered by the
Company in reaching a decision as to the accounting, auditing or financial reporting issue; or (2) any matter that was either
the subject of a disagreement (as defined in Item 304(a)(1)(iv) of Regulation S-K and the related instructions) or a reportable
event (as described in Item 304(a)(1)(v) of Regulation SK).