# EDGAR Filing Document

**Accession Number:** 0001422892
**File Stem:** 0001213900-23-017861
**Filing Date:** 2023-3
**Character Count:** 156258
**Document Hash:** b629652fd9a8fcefd278ea40354a69b2
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-23-017861.hdr.sgml**: 20230306

**ACCESSION NUMBER**: 0001213900-23-017861

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 106

**CONFORMED PERIOD OF REPORT**: 20220930

**FILED AS OF DATE**: 20230306

**DATE AS OF CHANGE**: 20230306

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Singularity Future Technology Ltd.
- **CENTRAL INDEX KEY:** 0001422892
- **STANDARD INDUSTRIAL CLASSIFICATION:** ARRANGEMENT OF TRANSPORTATION OF FREIGHT & CARGO [4731]
- **IRS NUMBER:** 261241372
- **STATE OF INCORPORATION:** VA
- **FISCAL YEAR END:** 0630

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-34024
- **FILM NUMBER:** 23710113

**BUSINESS ADDRESS:**
- **STREET 1:** 98 CUTTER MILL ROAD
- **STREET 2:** SUITE 322
- **CITY:** GREAT NECK
- **STATE:** NY
- **ZIP:** 11021
- **BUSINESS PHONE:** 718-888-1814

**MAIL ADDRESS:**
- **STREET 1:** 98 CUTTER MILL ROAD
- **STREET 2:** SUITE 322
- **CITY:** GREAT NECK
- **STATE:** NY
- **ZIP:** 11021

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Sino-Global Shipping America, Ltd.
- **DATE OF NAME CHANGE:** 20080107

?xml version="1.0" encoding="ASCII"?

**UNITED STATES** 

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, DC 20549**

**FORM 10-Q**

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended **September 30, 2022**

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to **__________.**

Commission File Number 001-34024

**<u>Singularity Future Technology Ltd.</u>**

(Exact name of registrant as specified in its charter)

---

| | |
|:---|:---|
| **Virginia** | **11-3588546** |
| (State or other jurisdiction of | (I.R.S. Employer |
| Incorporation or organization) | Identification No.) |

---

---

| | |
|:---|:---|
| **98 Cutter Mill Road, Suite 322**<br> **Great Neck, New York** | **11021** |
| (Address of principal executive offices) | (Zip Code) |

---

**(718) 888-1814**

(Registrant's telephone number, including area code)

**Securities registered pursuant to Section 12(b) of the Act:**

---

| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which<br> registered** |
| Common Stock, no par value | SGLY | NASDAQ Capital Market |

---

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐ No ☒

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐ No ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> Emerging Growth Company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes ☐ No ☒

As of March 3, 2023, the Company had 21,944,333 shares of common stock issued and outstanding.

**SINGULARITY FUTURE TECHNOLOGY LTD.**

**FORM 10-Q**

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
| [CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](#a_001) | ii |
| [PART I. FINANCIAL INFORMATION](#a_002) | 1 |
| [Item 1. Financial Statements](#a_003) | 1 |
| [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](#a_004) | 30 |
| [Item 3. Quantitative and Qualitative Disclosures About Market Risk](#a_005) | 35 |
| [Item 4. Controls and Procedures](#a_006) | 36 |
| [PART II. OTHER INFORMATION](#a_007) | 37 |
| [Item 1. Legal Proceedings](#a_008) | 37 |
| [Item 1A. Risk Factors](#a_009) | 37 |
| [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](#a_010) | 37 |
| [Item 3. Defaults Upon Senior Securities](#a_011) | 37 |
| [Item 4. Mine Safety Disclosures](#a_012) | 37 |
| [Item 5. Other Information](#a_013) | 37 |
| [Item 6. Exhibits](#a_014) | 37 |

---

i

**CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS**

This Report contains certain statements that constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Such forward-looking statements, including but not limited to statements regarding our projected growth, trends and strategies, future operating and financial results, financial expectations and current business indicators are based upon current information and expectations and are subject to change based on factors beyond our control. Forward-looking statements typically are identified by the use of terms such as "look," "may," "will," "should," "might," "believe," "plan," "expect," "anticipate," "estimate" and similar words, although some forward-looking statements are expressed differently. The accuracy of such statements may be impacted by a number of business risks and uncertainties we face that could cause our actual results to differ materially from those projected or anticipated, including but not limited to the following:

● our ability to timely and properly deliver our services;

● our dependence on a limited number of major customers and suppliers;

● our ability to resume our business of sales of crypto mining machines and to expand our operations after the conclusion of the investigation;

● current and future political and economic factors in the United States and China and the relationship between the two countries;

● our ability to explore and enter into new business opportunities and the acceptance in the marketplace of our new lines of business;

● unanticipated changes in general market conditions or other factors which may result in cancellations or reductions in the need for our services;

● the demand for warehouse, shipping and logistics services;

● the foreign currency exchange rate fluctuations;

● possible disruptions in commercial activities caused by events such as natural disasters, health epidemics, terrorist activity and armed conflict;

● our ability to identify and successfully execute cost control initiatives;

● the impact of quotas, tariffs or safeguards on our customer products that we service;

● our ability to attract, retain and motivate qualified management team members and skilled personnel;

● relevant governmental policies and regulations relating to our businesses and industries;

● developments in, or changes to, laws, regulations, governmental policies, incentives and taxation affecting our operations;

● our reputation and ability to do business may be impacted by the improper conduct of our employees, agents or business partners; and

● the outcome of litigation or investigation in which we are involved is unpredictable, and an adverse decision in any such matter could have a material adverse effect on our financial condition, results of operations, cash flows and equity.

Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to update the forward-looking statements. Nonetheless, the Company reserves the right to make such updates from time to time by press release, periodic report or other method of public disclosure without the need for specific reference to this Report. No such update shall be deemed to indicate that other statements not addressed by such update remain correct or create an obligation to provide any other updates.

ii

**PART I. FINANCIAL INFORMATION**

**Item 1. Financial Information.**

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| **Assets** |  |  |
| **Current assets** |  |  |
| Cash | $52460203 | $55833282 |
| Cryptocurrencies | 88937 | 90458 |
| Accounts receivable, net | 195739 | 108381 |
| Other receivables, net | 21810 | 25057 |
| Advances to suppliers – third parties, net | 42159 | 36540 |
| Advances to suppliers – related party | 1978368 | 6153546 |
| Prepaid expenses and other current assets | 464200 | 365913 |
| Loan receivable-related parties, net | 449697 | 552285 |
| **Total Current Assets** | 55701113 | 63165462 |
| Property and equipment, net | 620626 | 548956 |
| Right-of-use assets, net | 597604 | 732744 |
| Other long-term assets – deposits | 236982 | 237749 |
| Investment in unconsolidated entity | 160214 | 162829 |
| **Total Assets** | $57316539 | $64847740 |
| **Liabilities and Equity** |  |  |
| **Current Liabilities** |  |  |
| Deferred revenue | $2333694 | $6955577 |
| Refund payable | 13000000 | 13000000 |
| Accounts payable | 609389 | 508523 |
| Accounts payable - related party | 63434 | 63434 |
| Lease liabilities – current | 492568 | 471976 |
| Taxes payable | 3367714 | 3457177 |
| Accrued expenses and other current liabilities | 493623 | 756272 |
| **Total current liabilities** | 20360422 | 25212959 |
| Lease liabilities – noncurrent | 718431 | 846871 |
| Convertible notes | 5000000 | 5000000 |
| **Total liabilities** | 26078853 | 31059830 |
| **Commitments and Contingencies** |  |  |
| **Equity** |  |  |
| Preferred stock, 2,000,000 shares authorized, no par value, no shares issued and outstanding as of September 30, 2022 and June 30, 2022, respectively | - | - |
| Common stock, 50,000,000 shares authorized, no par value; 22,244,333 and 22,244,333 shares issued and outstanding as of September 30, 2022 and June 30, 2022, respectively | 96375024 | 96127691 |
| Additional paid-in capital | 2334962 | 2334962 |
| Accumulated deficit | (65663944) | (62579592) |
| Accumulated other comprehensive income | 199738 | 45739 |
| **Total Stockholders' Equity attributable to controlling shareholders of the Company** | 33245780 | 35928800 |
| **Non-controlling Interest** | (2008094) | (2140890) |
| **Total Equity** | 31237686 | 33787910 |
| **Total Liabilities and Equity** | $57316539 | $64847740 |

---

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** |
|  | **September 30,** | **September 30,** |
|  | **2022** | **2021** |
|  | | **(Restated)** |
| Net revenues | $1221204 | $816010 |
| Cost of revenues | (745627) | (1046868) |
| **Gross profit** | 475577 | (230858) |
| Selling expenses | (27375) | (74396) |
| General and administrative expenses | (2988920) | (1966569) |
| Recovery for doubtful accounts, net |  | 34195 |
| Stock-based compensation | (247333) | (2927400) |
| **Total operating expenses** | (3263628) | (4934170) |
| **Operating loss** | (2788051) | (5165028) |
| Other expenses, net | (58849) | (52354) |
| **Net loss before provision for income taxes** | (2846900) | (5217382) |
| Income tax expense | (103426) | - |
| Net loss | (2950326) | (5217382) |
| Net loss attributable to non-controlling interest | 134026 | (256202) |
| **Net loss attributable to controlling shareholders of the Company.** | $(3084352) | $(4961180) |
| **Comprehensive loss** |  |  |
| Net loss | $(2950326) | $(5217382) |
| Other comprehensive income - foreign currency | 152769 | 617761 |
| Comprehensive loss | (2797557) | (4599621) |
| Less: Comprehensive income (loss) attributable to non-controlling interest | 132796 | (264171) |
| **Comprehensive loss attributable to controlling shareholders of the Company.** | $(2930353) | $(4335450) |
| **Loss per share** |  |  |
| Basic and diluted | $(0.15) | $(0.32) |
| **Weighted average number of common shares used in computation** |  |  |
| Basic and diluted | 21216739 | 15670135 |

---

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (DEFICIENCY)

(UNAUDITED)

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | | | | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Additional<br> paid-in**<br>**capital** | **Subscription**<br>**receivable** | **Accumulated**<br>**deficit** | **Accumulated**<br> **other<br> comprehensive**<br>**loss** | **Noncontrolling**<br>**interest** | <br>**Total** |
| BALANCE, June 30, 2021 (Restated) |  | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- | 15132113 | $82555700 | $2334962 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - | $(34321762) | $(729096) | $(7415631) | $42424173 |
| Stock compensation issue to employee |  | - | 1020000 | 2927400 | - | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - | - | - | - | 2927400 |
| Foreign currency translation |  | - |  | - | - | - | - | 625730 | (7969) | 617761 |
| Net loss |  | - | - | - | - | - | (4961180) | - | (256202) | (5217382) |
| BALANCE, September 30, 2021 (Restated) |  | $- | 16152113 | $85483100 | $2334962 | $- | $(39282942) | $(103366) | $(7679802) | $40751952 |

---

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Preferred Stock** | **Preferred Stock** | **Common Stock** | **Common Stock** | | | | | | |
|  | **Shares** | **Amount** | **Shares** | **Amount** | **Additional <br> paid-in**<br>**capital** | **Subscription**<br>**receivable** | **Accumulated**<br>**deficit** | **Accumulated other<br> comprehensive**<br>**loss** | **Noncontrolling**<br>**interest** |<br>**Total** |
| BALANCE, June 30, 2022 |  | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - | 22244333 | $96127691 | $2334962 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - | $(62579592) | $45739 | $(2140890) | $33787910 |
| Stock based compensation to consultants |  | - | - | 247333 | - | - | - | - | - | 247333 |
| Foreign currency translation |  | - |  | - | - | - | - | 153999 | (1230) | 152769 |
| Net loss |  | - | - | - | - | - | (3084352) | - | 134026 | (2950326) |
| BALANCE, September 30, 2022 |  | $- | 22244333 | $96375024 | $2334962 | $- | $(65663944) | $199738 | $(2008094) | $31237686 |

---

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

---

| | | |
|:---|:---|:---|
|  | **For the Three Months<br> Ended** | **For the Three Months<br> Ended** |
|  | **September 30,** | **September 30,** |
|  | **2022** | **2021** |
| **Operating Activities** |  | **(Restated)** |
| Net loss | $(2950326) | $(5217382) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;Stock-based compensation | 247333 | 2927400 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 78945 | 140710 |
| &nbsp;&nbsp;&nbsp;Non-cash lease expense | 135215 | 118178 |
| &nbsp;&nbsp;&nbsp;(Recovery) provision for doubtful accounts, net | - | (34195) |
| &nbsp;&nbsp;&nbsp;Loss on disposal of fixed assets | - | 52489 |
| &nbsp;&nbsp;&nbsp;Impairment loss of cryptocurrencies | 1521 | - |
| &nbsp;&nbsp;&nbsp;Investment loss from unconsolidated subsidiary | 2614 | - |
| Changes in assets and liabilities |  |  |
| &nbsp;&nbsp;&nbsp;Accounts receivable | 6278 | 20239 |
| &nbsp;&nbsp;&nbsp;Other receivables | 235392 | 1663023 |
| &nbsp;&nbsp;&nbsp;Advances to suppliers – third parties | (7304) | 573818 |
| &nbsp;&nbsp;&nbsp;Advances to suppliers – related party | 4175178 | - |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | (98287) | 112449 |
| &nbsp;&nbsp;&nbsp;Other long-term assets – deposits | 327 | (20061) |
| &nbsp;&nbsp;&nbsp;Deferred revenue | (4619813) | (399085) |
| &nbsp;&nbsp;&nbsp;Accounts payable | 102101 | (33147) |
| &nbsp;&nbsp;&nbsp;Taxes payable | (90808) | 87413 |
| &nbsp;&nbsp;&nbsp;Lease liabilities | (107853) | (109237) |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other current liabilities | (271911) | (11572) |
| **Net cash used in operating activities** | (3161398) | (128960) |
| **Investing Activities** |  |  |
| &nbsp;&nbsp;&nbsp;Acquisition of property and equipment | (150966) | (617147) |
| &nbsp;&nbsp;&nbsp;Loan receivable-related parties | 70265 | - |
| &nbsp;&nbsp;&nbsp;Investment in unconsolidated entity | - | (210000) |
| &nbsp;&nbsp;&nbsp;Advance to related parties | - | (1475301) |
| **Net cash used in investing activities** | (80701) | (2302448) |
| **Financing Activities** |  |  |
| &nbsp;&nbsp;&nbsp;Repayment of loan payable | - | (1776) |
| **Net cash used in financing activities** | - | (1776) |
| Effect of exchange rate fluctuations on cash | (130980) | 544741 |
| **Net decrease in cash** | (3373079) | (1888443) |
| Cash at beginning of period | 55833282 | 44837317 |
| Cash at end of period | $52460203 | $42948874 |
| **Supplemental information** |  |  |
| &nbsp;&nbsp;&nbsp;Interest paid | $- | $1445 |
| **Non-cash transactions of operating and investing activities** |  |  |
| &nbsp;&nbsp;&nbsp;Initial recognition of right-of-use assets and lease liabilities | $- | $1384721 |

---

**SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES**

**Notes to the Condensed Consolidated Financial Statements**

**For the Three Months ended September 30, 2022**

**Note 1. ORGANIZATION AND NATURE OF BUSINESS**

The Company is a global logistics integrated solution provider that was founded in the United States in 2001. On September 18, 2007, the Company amended its Articles of Incorporation and Bylaws to merge into a new corporation, Sino-Global Shipping America, Ltd. in Virginia. The Company primarily focuses on providing logistics and support to businesses in the Peoples' Republic of China ("PRC") and the United States. On January 3, 2022, the Company changed its corporate name from Sino-Global Shipping America, Ltd. to Singularity Future Technology Ltd. to reflect its expanded operations into the digital assets business.

The Company conducted its business primarily through its wholly-owned subsidiaries in the PRC (including Hong Kong) and the United States, where the majority of its clients are located. As of September 30, 2022, the Company operated in two segments: (1) freight logistics services which include shipping and warehouse, which were operated by its subsidiaries in both the United States and PRC, and (2) the sale of crypto-mining machines, which were operated by its subsidiaries in the United States.

The outbreak of the novel coronavirus ("COVID-19") starting from late January 2020 in the PRC has spread rapidly to many parts of the world. In March 2020, the World Health Organization declared the COVID-19 as a pandemic and has resulted in quarantines, travel restrictions, and the temporary closure of stores and business facilities in China and the U.S. Given the rapidly expanding nature of the COVID-19 pandemic, and because substantially all of the Company's business operations and its workforce are concentrated in China and the U.S., the Company's business, results of operations, and financial condition have been adversely affected. In early December 2022, Chinese government eased the strict control measure for COVID-19, which has led to surge in increased infections and disruption in our business operations. Any future impact of COVID-19 on the Company's operation results will depend on, to a large extent, future developments and new information that may emerge regarding the duration and resurgence of COVID-19 variants and the actions taken by government authorities to contain COVID-19 or treat its impact, almost all of which are beyond our control.

As of September 30, 2022, the Company's subsidiaries included the following:

---

| | | | |
|:---|:---|:---|:---|
| **Name** | **Background** | **Background** | **Ownership** |
| Sino-Global Shipping New York Inc. ("SGS NY") | ●  ●  ●  | A New York Corporation<br> Incorporated on May 03, 2013<br> Primarily engages in freight logistics services | 100% owned by the Company |
| Sino-Global Shipping Australia Pty Ltd. ("SGS AUS") | ●  ●  ●  | An Australian Corporation<br> Incorporated on July 03, 2008<br> No material operations | 100% owned by the Company. Dissolved in November 2022 |
| Sino-Global Shipping HK Ltd. ("SGS HK") | ●  ●  ●  | A Hong Kong Corporation<br> Incorporated on September 22, 2008<br> No material operations | 100% owned by the Company |
| Thor Miner Inc. ("Thor Miner") | ●  ●  ●  | A Delaware Corporation<br> Incorporated on October 13, 2021<br> Primarily engaged in sales of crypto mining machines | 51% owned by the Company<br>|

---

---

| | | | |
|:---|:---|:---|:---|
| Trans Pacific Shipping Ltd. ("Trans Pacific Beijing") | ●  ●  ●  | A PRC limited liability company<br> Incorporated on November 13, 2007.<br> Primarily engaged in freight logistics services | 100% owned by the Company |
| Trans Pacific Logistic Shanghai Ltd. ("Trans Pacific Shanghai") | ●  ●  ●  | A PRC limited liability company<br> Incorporated on May 31, 2009<br> Primarily engaged in freight logistics services | 90% owned by Trans Pacific Beijing |
| Ningbo Saimeinuo Supply Chain Management Ltd. ("SGS Ningbo") | ●  ●  ●  | A PRC limited liability company<br> Incorporated on September 11, 2017<br> Primarily engaged in freight logistics services | 100% owned by SGS NY |
| Blumargo IT Solution Ltd. ("Blumargo") | ●  ●  ● | A New York Corporation<br> Incorporated on December 14, 2020<br> No material operations | 100% owned by SGS NY |
| Blumargo IT Solution Ltd. ("Blumargo") | ●  ●  ● | A New York Corporation<br> Incorporated on December 14, 2020<br> No material operations | 100% owned by SGS NY |
| Blumargo IT Solution Ltd. ("Blumargo") | ●  ●  ● | A New York Corporation<br> Incorporated on December 14, 2020<br> No material operations | 100% owned by SGS NY |
| Gorgeous Trading Ltd ("Gorgeous Trading") | ●  ●  ●  | A Texas Corporation<br> Incorporated on July 01, 2021<br> Primarily engaged in warehouse related services | 100% owned by SGS NY |
| Brilliant Warehouse Service Inc. ("Brilliant Warehouse") | ●  ●  ●  | A Texas Corporation<br> Incorporated on April 19, 2021<br> Primarily engaged in warehouse house related services | 51% owned by SGS NY |
| Phi Electric Motor In. ("Phi") | ●  ●  ●  | A New York Corporation<br> Incorporated on August 30, 2021<br> No operations  | 51% owned by SGS NY |
| SG Shipping &Risk Solution Inc, ("SGSR") | ●  ●  ● | A New York Corporation<br> Incorporated on September 29, 2021<br> No material operations | 100% owned by the Company |
| SG Link LLC ("SG Link") | ●  ●  ●  | A New York Corporation<br> Incorporated on December 23, 2021<br> No operations | 100% owned by SG Shipping & Risk Solution Inc on January 25, 2022 |

---

**Restatement of previously issued financial statements**

The Company discovered an error in revenue recognition in its subsidiary, SGS NY., during the audit for the year ended June 30, 2022 that $980,200 of revenue recognized in freight logistics did not meet revenue recognition criteria for the three months ended September 30, 2021.

In addition, in connection with the Company's restatement for the financial statements as of and for the year ended June 30, 2021, the Company also restated its recovery (provision) for doubtful accounts, net related to its other receivables.

Effects of the restatements are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **As**<br>**Previously**<br>**Reported** |<br>**Adjustments** |<br>**As**<br>**Restated** |
| **Consolidated statement of operations for the three months ended September 30, 2021** | | | |
| Net revenues | $1796210 | $(980200) | $816010 |
| Cost of revenues | (1626868) | 580000 | (1046868) |
| Recovery (provision) for doubtful accounts, net | 1929715 | (1895520) | 34195 |
| Net loss | $(2921662) | $(2295720) | $(5217382) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **As**<br>**Previously**<br>**Reported** |<br>**Adjustments** |<br>**As**<br> **Restated** |
| **Consolidated statement of cash flow for the three months ended September 30, 2021** | | | |
| Cash flows from operating activities: |  |  |  |
| Net loss | $(2921662) | $(2295720) | $(5217382) |
| Provision for doubtful accounts | (1929715) | 1895520 | (34195) |

---

**Note 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

**(a) Basis of Presentation**

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("US GAAP") pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). The unaudited condensed consolidated financial statements include the accounts of the Company and include the assets, liabilities, revenues and expenses of its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

Prior to December 31, 2021, Sino-China was considered a Variable Interest Entity ("VIE"), with the Company as the primary beneficiary. The Company, through Trans Pacific Beijing, entered into certain agreements with Sino-Global Shipping Agency Ltd. ("Sino-China"), pursuant to which the Company received 90% of Sino-China's net income.

As a VIE, Sino-China's revenues were included in the Company's total revenues, and any income or loss from operations were consolidated with that of the Company. Because of contractual arrangements between the Company and Sino-China, the Company had a pecuniary interest in Sino-China that required consolidation of the financial statements of the Company and Sino-China.

The Company has consolidated Sino-China's operating results in accordance with Accounting Standards Codification ("ASC") 810-10, "Consolidation." The agency relationship between the Company and Sino-China and its branches was governed by a series of contractual arrangements pursuant to which the Company had substantial control over Sino-China. Management makes ongoing reassessments of whether the Company remains the primary beneficiary of Sino-China. On December 31, 2021, the Company entered into a series of agreements to terminate its VIE structure and deconsolidated its formerly controlled entity Sino-China.

**(b) Fair Value of Financial Instruments**

The Company follows the provisions of ASC 820, Fair Value Measurements and Disclosures, which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows:

Level 1 — Observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date.

Level 2 — Inputs other than quoted prices that are observable for the asset or liability in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data.

Level 3 — Unobservable inputs that reflect management's assumptions based on the best available information.

The carrying value of accounts receivable, other receivables, other current assets, and current liabilities approximate their fair values because of the short-term nature of these instruments.

**(c) Use of Estimates and Assumptions**

The preparation of the Company's unaudited condensed consolidated financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Estimates are adjusted to reflect actual experience when necessary. Significant accounting estimates reflected in the Company's unaudited condense consolidated financial statements include revenue recognition, fair value of stock-based compensation, cost of revenues, allowance for credit losses, impairment loss, deferred income taxes, income tax expense and the useful lives of property and equipment. The inputs into the Company's judgments and estimates consider the economic implications of COVID-19 on the Company's critical and significant accounting estimates. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from those estimates.

**(d) Translation of Foreign Currency**

The accounts of the Company and its subsidiaries are measured using the currency of the primary economic environment in which the entity operates (the "functional currency"). The Company's functional currency is the U.S. dollar ("USD") while its subsidiaries in the PRC, including Trans Pacific Beijing and Trans Pacific Shanghai report their financial positions and results of operations in Renminbi ("RMB"), its subsidiary Sino-Global Shipping (HK), Ltd. reports its financial positions and results of operations in Hong Kong dollar ("HKD"). The accompanying consolidated unaudited condensed financial statements are presented in USD. Foreign currency transactions are translated into USD using the fixed exchange rates in effect at the time of the transaction. Generally, foreign exchange gains and losses resulting from the settlement of such transactions are recognized in the consolidated statements of operations. The Company translates the foreign currency financial statements in accordance with ASC 830-10, "Foreign Currency Matters". Assets and liabilities are translated at current exchange rates quoted by the People's Bank of China at the balance sheets' dates and revenues and expenses are translated at average exchange rates in effect during the year. The resulting translation adjustments are recorded as other comprehensive loss and accumulated other comprehensive loss as a separate component of equity of the Company, and also included in non-controlling interests.

The exchange rates as of September 30, 2022 and June 30, 2022 and for the three months ended September 30, 2022 and 2021 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **September 30, <br> 2022** | **June 30,** <br> **2022** | **Three Months ended <br>September 30** | **Three Months ended <br>September 30** |
| <br>**Foreign currency** | **Balance<br> Sheet** | **Balance<br> Sheet** | **2022<br> Profits/Loss** | **2021**<br> **Profits/Loss** |
| 1USD: RMB | 7.1159 | 6.6994 | 6.8425 | 6.4708 |
| 1USD: HKD | 7.8500 | 7.8474 | 7.8483 | 7.7777 |

---

**(e) Cash** 

Cash consists of cash on hand and cash in bank which are unrestricted as to withdrawal or use. The Company maintains cash with various financial institutions mainly in the PRC, Australia, Hong Kong and the U.S. As of September 30, 2022 and June 30, 2022, cash balances of $45,326 and $143,044, respectively, were maintained at financial institutions in the PRC. Nil and $201,990 of these balances are not covered by insurance as the deposit insurance system in China only insured each depositor at one bank for a maximum of approximately $70,000 (RMB 500,000). As of September 30, 2022 and June 30, 2022, cash balances of $52,396,159 and $55,636,636, respectively, were maintained at U.S. financial institutions. $50,787,831 and $53,869,575 of these balances, respectively, are not covered by insurance, as each U.S. account was insured by the Federal Deposit Insurance Corporation or other programs subject to $250,000 limitations. The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD 500,000 (approximately $64,000) if the bank with which an individual/a company holds its eligible deposit fails. As of September 30, 2022 and June 30, 2022, cash balances of $16,559 and $51,701, respectively, were maintained at financial institutions in Hong Kong and were insured by the Hong Kong Deposit Protection Board. As of September 30, 2022 and June 30, 2022, cash balances of $179 and $192, respectively, were maintained at Australia financial institutions, and were insured as the Australian government guarantees deposits up to AUD 250,000 (approximately $172,000). As of September 30, 2022 and June 30, 2022, amount of deposits the Company had covered by insurance amounted to $1,670,392 and $1,961,997, respectively.

**(f) Cryptocurrencies**

Cryptocurrencies, mainly bitcoin, are included in current assets in the accompanying consolidated balance sheets. Cryptocurrencies purchased are recorded at cost. Other income generated from mining activities for the three months ended September 30, 2022 and 2021 amounted to nil and $261,338, respectively. Fair value of the cryptocurrency award received is determined using the quoted price of the related cryptocurrency at the time of receipt.

Cryptocurrencies held are accounted for as intangible assets with indefinite useful lives. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value, which is measured using the quoted price of the cryptocurrency at the time its fair value is being measured. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted.

**(g) Receivables and Allowance for Credit Losses**

Accounts receivable are presented at net realizable value. The Company maintains allowances for credit losses. The Company reviews the accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual receivable balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balances, customers' historical payment history, their current credit-worthiness and current economic trends. The estimate of expected credit losses is based on information about past events, current economic conditions, and forecasts of future economic conditions that affect collectability. Receivables are generally considered past due after 180 days. The Company reserves 25%-50% of the customers balance aged between 181 days to 1 year, 50%-100% of the customers balance over 1 year and 100% of the customers balance over 2 years. Accounts receivable are written off against the allowances only after exhaustive collection efforts.

Other receivables represent mainly customer advances, prepaid employee insurance and welfare benefits, which will be subsequently deducted from the employee payroll, project advances as well as office lease deposits. Management reviews its receivables on a regular basis to determine if the credit loss is adequate, and adjusts the allowance when necessary. The estimate of expected credit losses is based on information about past events, current economic conditions, and forecasts of future economic conditions that affect collectability. Delinquent account balances are written-off against allowance for credit losses after management has determined that the likelihood of collection is not probable. Other receivables are written off against the allowances only after exhaustive collection efforts.

**(h) Property and Equipment, net**

Property and equipment are stated at historical cost less accumulated depreciation. Historical cost comprises its purchase price and any directly attributable costs of bringing the assets to its working condition and location for its intended use. Depreciation is calculated on a straight-line basis over the following estimated useful lives:

---

| | |
|:---|:---|
| Buildings | 20 years |
| Motor vehicles | 3-10 years |
| Computer and office equipment | 1-5 years |
| Furniture and fixtures | 3-5 years |
| System software | 5 years |
| Leasehold improvements | Shorter of lease term or useful lives |
| Mining equipment | 3 years |

---

The carrying value of a long-lived asset is considered impaired by the Company when the anticipated undiscounted cash flows from such asset is less than its carrying value. If impairment is identified, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved or based on independent appraisals. For the three months ended September 30, 2022 and 2021, nil and nil impairment were recorded, respectively.

**(i) Investments in unconsolidated entity**

Entities in which the Company has the ability to exercise significant influence, but does not have a controlling interest, are accounted for using the equity method. Significant influence is generally considered to exist when the Company has voting shares representing 20% to 50%, and other factors, such as representation on the board of directors, voting rights and the impact of commercial arrangements, are considered in determining whether the equity method of accounting is appropriate. Under this method of accounting, the Company records its proportionate share of the net earnings or losses of equity method investees and a corresponding increase or decrease to the investment balances. Dividends received from the equity method investments are recorded as reductions in the cost of such investments. The Company generally considers an ownership interest of 20% or higher to represent significant influence. The Company accounts for the investments in entities over which it has neither control nor significant influence, and no readily determinable fair value is available, using the investment cost minus any impairment, if necessary.

Investments are evaluated for impairment when facts or circumstances indicate that the fair value of the long-term investment is less than its carrying value. An impairment loss is recognized when a decline in fair value is determined to be other-than-temporary. The Company reviews several factors to determine whether a loss is other-than-temporary. These factors include, but are not limited to, the: (i) nature of the investment; (ii) cause and duration of the impairment; (iii) extent to which fair value is less than cost; (iv) financial condition and near term prospects of the investment; and (v) ability to hold the security for a period of time sufficient to allow for any anticipated recovery in fair value. On January 10, 2020, the Company entered into a cooperation agreement with Mr. Shanming Liang, a shareholder of the Company, to set up a joint venture in New York named LSM Trading Ltd. ("LSM") in which the Company holds a 40% equity interest. Mr. Shanming Liang subsequently transferred his shares to Guanxi Golden Bridge Industry Group Co., Ltd in October 2021. For the year ended June 30, 2022, the Company invested $210,000 and recorded $47,181 investment loss. The joint venture has not started its operations due to COVID-19 and substantially all of the Company's investment was deposited in bank account with LSM and LSM has only incurred some administrative expenses. The Company recorded $2,614 investment loss for the three months ended September 30, 2022. No events have occurred that indicated other-than-temporary impairment existed for the three months ended September 30, 2022.

**(j) Convertible notes**

The Company evaluates its convertible notes to determine if those contracts or embedded components of those contracts qualify as derivatives. The result of this accounting treatment is that the fair value of the embedded derivative is recorded at fair value each reporting period and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statements of operations as other income or expense.

**(k) Revenue Recognition**

The Company recognizes revenue which represents the transfer of goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. The Company identifies contractual performance obligations and determines whether revenue should be recognized at a point in time or over time, based on when control of goods and services transfers to a customer.

The Company uses a five-step model to recognize revenue from customer contracts. The five-step model requires the Company to (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance obligation.

For the Company's freight logistic and shipping agency services revenue, the Company provides transportation services which includes primarily shipping services. The Company derived transportation revenue from sales contracts with its customers with revenues being recognized upon the performance of services. The sales price to the customer was fixed upon acceptance of the sales contract, and there was no separate sales rebate, discount, or other incentives. The Company's revenues were recognized after all performance obligations were satisfied

For the Company's warehouse services, which are included in the freight logistic services, the Company's contracts provide the customer with an integrated service that includes two or more services, including but not limited to warehousing, collection, first-mile delivery, drop shipping, customs clearance and packaging. Accordingly, the Company generally identifies one performance obligation in its contracts, which is a series of distinct services that remain substantially the same over time and possess the same pattern of transfer. Revenue is recognized over the period in which services are provided under the terms of the Company's contractual relationships with its clients.

Accordingly, the Company generally identifies one performance obligation in its contracts, which is a series of distinct services that remain substantially the same over time and possess the same pattern of transfer. Revenue is recognized over the period in which services are provided under the terms of the Company's contractual relationships with its clients.

The transaction price is based on the amount specified in the contract with the customer and contains fixed and variable consideration. In general, the fixed consideration in a contract represents facility and equipment costs incurred to satisfy the performance obligation and is recognized on a straight-line basis over the term of the contract. The variable consideration is comprised of cost reimbursement determined based on the costs incurred. Revenue relating to variable pricing is estimated and included in the consideration if it is probable that a significant revenue reversal will not occur in the future. The estimate of variable consideration is determined by the expected value or most likely amount method and factors in current, past and forecasted experience with the customer. Customers are billed based on terms specified in the revenue contract and they pay us according to approved payment terms.

Revenue for the above services is recognized on a gross basis when the Company controls the services as it has the obligation to (i) provide all services (ii) bear any inventory risk for warehouse services. In addition, the Company has control to set its selling price to ensure it would generate profit for the services.

For the three months ended September 30, 2022, the Company also engaged in sales of cryptocurrency mining equipment.

On January 10, 2022, the Company's joint venture, Thor Miner, entered into a Purchase and Sale Agreement with SOS Information Technology New York Inc. ("SOSNY"). Pursuant to the Purchase and Sale Agreement, Thor Miner agreed to sell and SOSNY agreed to purchase certain cryptocurrency mining equipment. The Company made three shipments for the three months ended September 30, 2022.

The Company's performance obligation is to deliver products according to contract specifications. The Company recognizes product revenue at a point in time when the control of products or services are transferred to customers. To distinguish a promise to provide products from a promise to facilitate the sale from a third party, the Company considers the guidance of control in ASC 606-10-55-37A and the indicators in 606-10-55-39. The Company considers this guidance in conjunction with the terms in the Company's arrangements with both suppliers and customers.

In general, revenue is recognized on a gross basis when the Company controls the products as it has the obligation to (i) fulfill the products delivery and custom clearance (ii) bear any inventory risk as legal owners. In addition, when establishing the selling prices for delivery of the resale products, the Company has control to set its selling price to ensure it would generate profit for the products delivery arrangements. If the Company is not responsible for provision of product and does not bear inventory risk, the Company recorded revenue on a net basis.

For the three months ended September 30, 2022, the Company recognized the sale of cryptocurrency mining equipment based on net basis as the manufacturer of the products are responsible for shipping and custom clearing for the products.

*Contract balances*

 

The Company records receivables related to revenue when the Company has an unconditional right to invoice and receive payment.

Deferred revenue consists primarily of customer billings made in advance of performance obligations being satisfied and revenue being recognized. Contract balance amounted to $2,333,694 and $71,391 for the three months ended September 30, 2022 and 2021, respectively. Refund payable amounted to $13,000,000 and nil for the three months ended September 30, 2022 and 2021, respectively.

The Company's disaggregated revenue streams are described as follows:

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| | | |
|:---|:---|:---|
|  | **For Three Months Ended** | **For Three Months Ended** |
|  | **September 30,**<br>**2022** | **September 30, <br> 2021**<br>**(Restated)** |
| Sales of crypto mining machines | $497045 | $- |
| Freight logistics services | 724159 | 816010 |
| Total | $1221204 | $816010 |

---

Disaggregated information of revenues by geographic locations are as follows:

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** |
|  | **September 30,**<br>**2022** | **September 30,**<br>**2021** |
| PRC | $248210 | $725077 |
| U.S. | 972994 | 90933 |
| Total revenues | $1221204 | $816010 |

---

**(l) Leases**

The Company adopted FASB ASU 2016-02, "Leases" (Topic 842) for the year ended June 30, 2020, and elected the practical expedients that does not require us to reassess: (1) whether any expired or existing contracts are, or contain, leases, (2) lease classification for any expired or existing leases and (3) initial direct costs for any expired or existing leases. For lease terms of twelve months or fewer, a lessee is permitted to make an accounting policy election not to recognize lease assets and liabilities. The Company also adopted the practical expedient that allows lessees to treat the lease and non-lease components of a lease as a single lease component. Upon adoption, the Company recognized right of use ("ROU") assets and same amount of lease liabilities based on the present value of the future minimum rental payments of leases, using an incremental borrowing rate of 7% based on the duration of lease terms.

Operating lease ROU assets and lease liabilities are recognized at the adoption date or the commencement date, whichever is earlier, based on the present value of lease payments over the lease term. Since the implicit rate for the Company's leases is not readily determinable, the Company use its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The incremental borrowing rate is the rate of interest that the Company would have to pay to borrow, on a collateralized basis, an amount equal to the lease payments, in a similar economic environment and over a similar term.

Lease terms used to calculate the present value of lease payments generally do not include any options to extend, renew, or terminate the lease, as the Company does not have reasonable certainty at lease inception that these options will be exercised. The Company generally considers the economic life of its operating lease ROU assets to be comparable to the useful life of similar owned assets. The Company has elected the short-term lease exception, therefore operating lease ROU assets and liabilities do not include leases with a lease term of twelve months or less. Its leases generally do not provide a residual guarantee. The operating lease ROU asset also excludes lease incentives. Lease expense is recognized on a straight-line basis over the lease term.

The Company reviews the impairment of its ROU assets consistent with the approach applied for its other long-lived assets. The Company reviews the recoverability of its long-lived assets when events or changes in circumstances occur that indicate that the carrying value of the asset may not be recoverable. The assessment of possible impairment is based on its ability to recover the carrying value of the asset from the expected undiscounted future pre-tax cash flows of the related operations. The Company has elected to include the carrying amount of operating lease liabilities in any tested asset group and include the associated operating lease payments in the undiscounted future pre-tax cash flows.

**(m) Taxation**

Because the Company and its subsidiaries and Sino-China were incorporated in different jurisdictions, they file separate income tax returns. The Company uses the asset and liability method of accounting for income taxes in accordance with U.S. GAAP. Deferred taxes, if any, are recognized for the future tax consequences of temporary differences between the tax basis of assets and liabilities and their reported amounts in the unaudited condensed consolidated financial statements. A valuation allowance is provided against deferred tax assets if it is more likely than not that the asset will not be utilized in the future.

The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense. The Company had no uncertain tax positions as of September 30, 2022 and 2021.

Income tax returns for the years prior to 2018 are no longer subject to examination by U.S. tax authorities.

  ****

***PRC Enterprise Income Tax***

PRC enterprise income tax is calculated based on taxable income determined under the PRC Generally Accepted Accounting Principles ("PRC GAAP") at 25%. Sino-China and Trans Pacific Beijing were incorporated in the PRC and are subject to the Enterprise Income Tax Laws of the PRC.

 ****

***PRC Value Added Taxes and Surcharges***

The Company is subject to value added tax ("VAT"). Revenue from services provided by the Company's PRC subsidiaries, including Trans Pacific, and the VIE, and Sino-China, are subject to VAT at rates ranging from 9% to 13%. Entities that are VAT general taxpayers are allowed to offset qualified VAT paid to suppliers against their VAT liability. Net VAT liability is recorded in taxes payable on the consolidated balance sheets.

In addition, under the PRC regulations, the Company's PRC subsidiaries and VIE are required to pay city construction tax (7%) and education surcharges (3%) based on the net VAT payments.

**(n) Earnings (loss) per Share**

Basic earnings (loss) per share is computed by dividing net income (loss) attributable to holders of common stock of the Company by the weighted average number of shares of common stock of the Company outstanding during the applicable period. Diluted earnings (loss) per share reflect the potential dilution that could occur if securities or other contracts to issue common stock of the Company were exercised or converted into common stock of the Company. Common stock equivalents are excluded from the computation of diluted earnings per share if their effects would be anti-dilutive.

For the three months ended September 30, 2022 and 2021, there was no dilutive effect of potential shares of common stock of the Company because the Company generated net loss.

**(o) Comprehensive Income (Loss)**

The Company reports comprehensive income (loss) in accordance with the authoritative guidance issued by Financial Accounting Standards Board (the "FASB") which establishes standards for reporting comprehensive income (loss) and its component in financial statements. Other comprehensive income (loss) refers to revenue, expenses, gains and losses that under US GAAP are recorded as an element of stockholders' equity but are excluded from net income. Other comprehensive income (loss) consists of a foreign currency translation adjustment resulting from the Company not using the U.S. dollar as its functional currencies.

**(p) Stock-based Compensation**

The Company accounts for stock-based compensation awards to employees in accordance with FASB ASC Topic 718, "Compensation – Stock Compensation", which requires that stock-based payment transactions with employees be measured based on the grant-date fair value of the equity instrument issued and recognized as compensation expense over the requisite service period. The Company records stock-based compensation expense at fair value on the grant date and recognizes the expense over the employee's requisite service period.

The Company accounts for stock-based compensation awards to non-employees in accordance with FASB ASC Topic 718 amended by ASU 2018-07. Under FASB ASC Topic 718, stock compensation granted to non-employees has been determined as the fair value of the consideration received or the fair value of equity instrument issued, whichever is more reliably measured and is recognized as an expense as the goods or services are received.

Valuations of stock-based compensation are based upon highly subjective assumptions about the future, including stock price volatility and exercise patterns. The fair value of share-based payment awards was estimated using the Black-Scholes option pricing model. Expected volatilities are based on the historical volatility of the Company's stock. The Company uses historical data to estimate option exercise and employee terminations. The expected term of options granted represents the period of time that options granted are expected to be outstanding. The risk-free rate for periods within the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of the grant.

**(q) Risks and Uncertainties**

The Company's business, financial position and results of operations may be influenced by the political, economic, health and legal environments in the PRC, as well as by the general state of the PRC economy. The Company's operations in the PRC are subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks associated with, among others, the political, economic, health and legal environments and foreign currency exchange. The Company's results may be adversely affected by changes in the political, regulatory and social conditions in the PRC, and by changes in governmental policies or interpretations with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation, among other things.

In March 2020, the World Health Organization declared COVID-19 as a pandemic. Given the rapidly expanding nature of the COVID-19 pandemic, and because substantially all of the Company's business operations and the workforce are concentrated in China and United States, the Company's business, results of operations, and financial condition have been adversely affected for the three months ended September 30, 2022. The situation remains highly uncertain for any further outbreak or resurgence of the COVID-19. It is therefore difficult for the Company to estimate the impact on the business or operating results that might be adversely affected by any further outbreak or resurgence of COVID-19.

**(r) Recent Accounting Pronouncements**

In May 2019, the FASB issued ASU 2019-05, which is an update to ASU Update No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which introduced the expected credit losses methodology for the measurement of credit losses on financial assets measured at amortized cost basis, replacing the previous incurred loss methodology. The amendments in Update 2016-13 added Topic 326, Financial Instruments—Credit Losses, and made several consequential amendments to the Codification. Update 2016-13 also modified the accounting for available-for-sale debt securities, which must be individually assessed for credit losses when fair value is less than the amortized cost basis, in accordance with Subtopic 326-30, Financial Instruments— Credit Losses—Available-for-Sale Debt Securities. The amendments in this ASU address those stakeholders' concerns by providing an option to irrevocably elect the fair value option for certain financial assets previously measured at amortized cost basis. For those entities, the targeted transition relief will increase comparability of financial statement information by providing an option to align measurement methodologies for similar financial assets. Furthermore, the targeted transition relief also may reduce the costs for some entities to comply with the amendments in Update 2016-13 while still providing financial statement users with decision-useful information. In November 2019, the FASB issued ASU No. 2019-10, which to update the effective date of ASU No. 2016-13 for private companies, not-for-profit organizations and certain smaller reporting companies applying for credit losses standard. The new effective date for these preparers is for fiscal years beginning after July 1, 2023, including interim periods within those fiscal years. The Company has not early adopted this update and it will become effective on July 1, 2023 assuming the Company will remain eligible to be smaller reporting company. The adoption did not have material impact on the Company's unaudited condensed consolidated financial statements and related disclosures.

The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company's unaudited condensed consolidated financial statements.

**Note 3. CRYPTOCURRENCIES**

The following table presents additional information about cryptocurrencies:

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| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Beginning balance | $90458 | $261338 |
| Impairment loss | (1521) | (170880) |
| Ending balance | $88937 | $90458 |

---

Impairment loss amounted to $1,521 for the three months ended September 30, 2022. There is $170,880 impairment loss for the year ended June 30, 2022.

**Note 4. ACCOUNTS RECEIVABLE, NET**

The Company's net accounts receivable are as follows:

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| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Trade accounts receivable | $3513310 | $3521491 |
| Less: allowances for credit losses | (3317571) | (3413110) |
| Accounts receivable, net | $195739 | $108381 |

---

Movement of allowance for credit losses are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Beginning balance | $3413110 | $3475769 |
| Provision for credit losses, net of recovery | - | 257 |
| Exchange rate effect | (95539) | (62916) |
| Ending balance | $3317571 | $3413110 |

---

**Note 5. OTHER RECEIVABLES, NET**

The Company's other receivables are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Advances to customers\* | $4052528 | $3943547 |
| Employee business advances | 21810 | 23768 |
| Total | 4074338 | 3967315 |
| Less: allowances for credit losses | (4052528) | (3942258) |
| Other receivables, net | $21810 | $25057 |

---

\* In fiscal year 2019 and 2020, the Company entered into certain contracts with customers (state-owned entities in China) where the Company's services included freight costs and cost of commodities to be shipped to customers' designated locations. The Company prepaid the costs of commodities and recognized as advance payments on behalf of its customers. These advance payments on behalf of the customers will be repaid to the Company when either the contract terms expire or the contracts are terminated by either party. As aforementioned customers were negatively impacted by the pandemic and required additional time to execute existing contracts, they required additional time to pay. Due to significant uncertainty on whether the delayed contracts will be executed timely, the Company had provided full allowance during the fiscal year ended June 30, 2020.

Movement of allowance for credit losses are as follows:

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| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Beginning balance | $3942258 | $6024266 |
| Recovery for credit losses | - | (1934619) |
| Exchange rate effect | 110270 | (147389) |
| Ending balance | $4052528 | $3942258 |

---

**Note 6. ADVANCES TO SUPPLIERS**

The Company's advances to suppliers – third parties are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Freight fees (1) | $342159 | $336540 |
| Less: allowances for credit losses | (300000) | (300000) |
| Advances to suppliers-third parties, net | $42159 | $36540 |

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&nbsp;&nbsp;&nbsp;&nbsp;(1) The advanced freight fee is the Company's prepayment made for
various shipping costs for shipments from October 1, 2022 to March 31, 2023. As of September 30, 2022 and June 30, 2022, allowance
amounted to $300,000.

**Note 7. PREPAID EXPENSES AND OTHER CURRENT ASSETS**

The Company's prepaid expenses and other assets are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Prepaid income taxes | $11929 | $11929 |
| Other (including prepaid professional fees, rent, listing fees) | 452271 | 353984 |
| Total | $464200 | $365913 |

---

**Note 8. OTHER LONG-TERM ASSETS – DEPOSITS, NET**

The Company's other long-term assets – deposits are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Rental and utilities deposits | $245297 | $246581 |
| Less: allowances for deposits | (8315) | (8832) |
| Other long-term assets- deposits, net | $236982 | $237749 |

---

Movements of allowance for deposits are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Beginning balance | $8832 | $3177127 |
| Allowance for deposits | - |  |
| Less: Write-off |  | (3173408) |
| Exchange rate effect | (517) | 5113 |
| Ending balance | $8315 | $8832 |

---

**Note 9. PROPERTY AND EQUIPMENT, NET**

The Company's net property and equipment are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Motor vehicles | 715571 | 715571 |
| Computer equipment | 116729 | 117397 |
| Office equipment | 68271 | 67139 |
| Furniture and fixtures | 534596 | 390093 |
| System software | 105032 | 111562 |
| Leasehold improvements | 781129 | 829687 |
| Mining equipment | 922438 | 922438 |
| Total | 3243766 | 3153887 |
| Less: Impairment reserve | (1236282) | (1236282) |
| Less: Accumulated depreciation and amortization | (1386858) | (1368649) |
| Property and equipment, net | $620626 | $548956 |

---

Depreciation and amortization expenses for the three months ended September 30, 2022 and 2021 were $78,945 and $140,710, respectively. No impairment loss was recorded for the three months ended September 30, 2022 and 2021.

**Note 10. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES**

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Salary and reimbursement payable | $255078 | $305423 |
| Professional fees and other expense payable | 31510 | 305264 |
| Interest payable | 198022 | 136379 |
| Others | 9013 | 9206 |
| Total | $493623 | $756272 |

---

**Note 11. CONVERTIBLE NOTES:**

On December 19, 2021, the Company issued two Senior Convertible Notes (the "Convertible Notes") to two non-U.S. investors for an aggregate purchase price of $10,000,000.

The Convertible Notes bear an interest at 5% annually and may be converted into shares of the Company's common stock, no par value per share at a conversion price of $3.76 per share, the closing price of the common stock on December 17, 2021. The Convertible Notes are unsecured senior obligations of the Company, and the maturity date of the Convertible Notes is December 18, 2023. The Company may repay any portion of the outstanding principal, accrued and unpaid interest, without penalty for early repayment. The Company may make any repayment of principal and interest in (a) cash, (b) common stock at the conversion price or (c) a combination of cash or common stock at the conversion price.

The investors may convert any conversion amount into common stock on any date beginning on June 19, 2022.

The Company evaluated the convertible notes agreement under ASC 815 Derivatives and Hedging ("ASC 815") amended by ASU 2020-06. ASC 815 generally requires the analysis embedded terms and features that have characteristics of derivatives to be evaluated for bifurcation and separate accounting in instances where their economic risks and characteristics are not clearly and closely related to the risks of the host contract. Based on terms of the convertible notes agreements, the Company's notes are convertible for a fixed number of shares and do not require the Company to net settle. None of the embedded terms required bifurcation and liability classification.

On March 8, 2022, the Company issued amended and restated the terms of the notes and issued the Amended and Restated Senior Convertible Notes (the "Amended and Restated Convertible Notes") to the investors to change the principal amount of the Convertible Notes to an aggregate principal amount of $5,000,000. There other terms of the notes remained unchanged.

The terms of the Amended and Restated Convertible Notes are the same as that of the original Convertible Notes, except for the reduced principal amount and the waiver of interest for the $5,000,000 payment made on March 8, 2022.

For the three months ended September 30, 2022 and 2021, interest expenses related to the aforementioned convertible notes amounted to $61,643 and nil, respectively.

**Note 12. LEASES**

The Company determines if a contract contains a lease at inception which is the date on which the terms of the contract are agreed to and the agreement creates enforceable rights and obligations. US GAAP requires that the Company's leases be evaluated and classified as operating or finance leases for financial reporting purposes. The classification evaluation begins at the commencement date and the lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain and failure to exercise such option which result in an economic penalty. All of the Company's leases are classified as operating leases.

The Company has several lease agreements with lease terms ranging from two to five years. As of September 30, 2022, ROU assets and lease liabilities amounted to $597,604 and $1,210,999 (including $492,568 from lease liabilities current portion and $718,431 from lease liabilities non-current portion), respectively and weighted average discount rate was approximately 10.89%.

The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants. The leases generally do not contain options to extend at the time of expiration and the weighted average remaining lease terms are 3.06 years.

For the three months ended September 30, 2022 and 2021, rent expense amounted to approximately $146,461 and $118,178, respectively.

The five-year maturity of the Company's lease obligations is presented below:

---

| | |
|:---|:---|
| **Twelve Months Ending June 30,** | **Operating<br> Lease<br> Amount** |
| 2023 | $599401 |
| 2024 | 500801 |
| 2025 | 171365 |
| 2026 | 127408 |
| Total lease payments | 1398975 |
| Less: Interest | 187976 |
| Present value of lease liabilities | $1210999 |

---

**Note 13. EQUITY**

Stock issuances:

On December 14, 2021, the Company entered into a securities purchase agreement (the "Purchase Agreement") with non-U.S. investors and accredited investors pursuant to which the Company sold to the investors, and the investors agreed to purchase from the Company, an aggregate of 3,228,807 shares of common stock, no par value, and warrants to purchase 4,843,210 shares. The purchase price for each share of common stock and one and a half warrants is $3.26, and the exercise price per warrant is $4.00. The Company received net proceed of $10,525,819 and issued 3,228,807 shares and 4,843,210 warrants. In connection with the issuance, the Company issued 500,000 shares to a consultant in assisting the Company in finding potential investors.

The warrants will be exercisable at any time during the Exercise Window. The "Exercise Window" means the period beginning on or after June 14, 2022 and ending on or prior to 5:00 p.m. (New York City time) on December 13, 2026 but not thereafter; provided, however, that the total number of the Company's issued and outstanding shares of common stock, multiplied by the NASDAQ official closing bid price of the common stock shall equal or exceed $150,000,000 for a three consecutive month period prior to an exercise.

The Company's outstanding warrants are classified as equity since they qualify for exception from derivative accounting as they are considered to be indexed to the Company's own stock and require net share settlement. The fair value of the warrants was recorded as additional paid-in capital from common stock

On January 6, 2022, the Company entered into Warrant Purchase Agreements with certain warrant holders (the "Sellers") pursuant to which the Company agreed to buy back an aggregate of 3,870,800 warrants (the "Warrants") from the Sellers, and the Sellers agreed to sell the Warrants back to the Company. These Warrants were sold to these Sellers in three previous transactions that closed on February 11, 2021, February 10, 2021, and March 14, 2018. The purchase price for each Warrant is $2.00. Following announcement of the Warrant Purchase Agreements on January 6, 2022, the Company agreed to repurchase an additional 103,200 warrants from other Sellers on the same terms as the previously announced Warrant Purchase Agreements. The aggregate number of warrants repurchased under the Warrant Purchase Agreements was 3,974,000.

On January 7, 2022, the Company wired the purchase price to each Seller. Each Seller has agreed to deliver the Warrant to the Company for cancellation as soon as practicable following the closing date, but in no event later than January 13, 2022. The Warrants are deemed cancelled upon the receipt by the Sellers of the purchase price.

Following is a summary of the status of warrants outstanding and exercisable as of September 30, 2022:

---

| | | |
|:---|:---|:---|
|  | **Warrants** | **Weighted<br> Average<br> Exercise<br> Price** |
| Warrants outstanding, as of June 30, 2022 | 12191824 | $4.37 |
| &nbsp;&nbsp;&nbsp;Issued | - | - |
| &nbsp;&nbsp;&nbsp;Exercised | - | - |
| &nbsp;&nbsp;&nbsp;Repurchased | - | - |
| Warrants outstanding, as of September 30, 2022 | 12191824 | $4.37 |
| Warrants exercisable, as of September 30, 2022 | 12191824 | $4.37 |

---

---

| | | | |
|:---|:---|:---|:---|
| **Warrants Outstanding** | **Warrants<br> Exercisable** | **Weighted<br> Average<br> Exercise<br> Price** | **Average<br> Remaining<br> Contractual<br> Life** |
| 2018 Series A, 400,000 | 103334 | $8.75 | 0.95 years |
| 2020 warrants, 2,922,000 | 181000 | $1.83 | 2.92 years |
| 2021 warrants, 11,088,280 | 11907490 | $4.94 | 3.81 years |

---

Stock-based compensation:

By action taken as of August 13, 2021, the Board of Directors (the "Board") of the Company and the Compensation Committee of the Board approved a one-time award of a total of 1,020,000 shares of the common stock under the Company's 2014 Stock Incentive Plan (the "Plan") to, including (i) a one-time stock award grant of 600,000 shares to Chief Executive Officer, Lei Cao, (ii) a one-time stock award grant of 200,000 shares to acting Chief Financial Officer, Tuo Pan, (iii) a one-time stock award grant of 160,000 shares to Board member, Zhikang Huang, (iv) a one-time stock award grant of 20,000 shares to Board member, Jing Wang, (v) a one-time stock award grant of 20,000 shares to Board member, Xiaohuan Huang, and (vi) a one-time stock award grant of 20,000 shares to Board member, Tieliang Liu. The shares were valued at an aggregate of $2,927,400 based on the grant date fair value of such shares.

On November 18, 2021, Mr. Jing Wang retired from his position as a member of the Board, the Chairperson of the Committee, a member of Nominating/Corporate Governance Committee, and a member of the Audit Committee. In connection with Mr. Wang's retirement, the Company granted Mr. Wang 100,000 shares of common stock under the Company's 2021 stock incentive plan, which shares were valued at $377,000 based on the grant date fair value.

On February 4, 2022, the Company approved a one-time award of a total of 500,000 shares of common stock under the Company's 2021 Stock Incentive Plan to certain executive officers of the Company, including Chief Executive Officer, Yang Jie (300,000 shares), Chief Operating Officer, Jing Shan (100,000 shares), and Chief Technology Officer, Shi Qiu (100,000 shares). The total fair value of the grants amounts to $2,740,000 based on the grant date share price of $5.48.

On February 16, 2022, the Company's Board approved a consulting agreement pursuant to which the Company will pay the consultant a monthly fee of $10,000 and 100,000 shares of the Company's common stock. The shares were valued at $7.42 at grant date with a grant date fair value of $742,000 to be amortized through October 31, 2022. Stock compensation expenses for this contract was $247,333 for the year ended September 30, 2022.

During the three months ended September 30, 2022 and 2021, $247,333 and $2,927,400 were recorded as stock-based compensation expense, respectively.

Stock Options:

A summary of the outstanding options is presented in the table below:

---

| | | |
|:---|:---|:---|
|  | **Options** | **Weighted<br> Average<br> Exercise<br> Price** |
| Options outstanding, as of June 30, 2022 | 2000 | $10.05 |
| &nbsp;&nbsp;&nbsp;Granted | - | - |
| &nbsp;&nbsp;&nbsp;Exercised | - | - |
| &nbsp;&nbsp;&nbsp;Cancelled, forfeited or expired | - | - |
| Options outstanding, as of September 30, 2022 | 2000 | $10.05 |
| Options exercisable, as of September 30, 2022 | 2000 | $10.05 |

---

Following is a summary of the status of options outstanding and exercisable as of September 30, 2022:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Outstanding Options** | **Outstanding Options** | **Outstanding Options** | **Exercisable Options** | **Exercisable Options** | **Exercisable Options** |
| **Exercise Price** | **Number** | **Average<br> Remaining<br> Contractual <br> Life** | **Average<br> Exercise Price** | **Number** | **Average<br> Remaining<br> Contractual<br> Life** |
| $10.05 | 2000 | 0.59 years | $10.05 | 2000 | 0.33 years |

---

**Note 14. NON-CONTROLLING INTEREST** 

The Company's non-controlling interest consists of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Trans Pacific Logistics Shanghai Ltd. | (1530094) | (1521645) |
| Thor Miner Inc. | (535780) | (486942) |
| Brilliant Warehouse Service, Inc. | 57780 | (132303) |
| Total | $(2008094) | $(2140890) |

---

**Note 15. COMMITMENTS AND CONTINGENCIES**

***Contingencies***

From time to time, the Company may be subject to certain legal proceedings, claims and disputes that arise in the ordinary course of business. Although the outcomes of these legal proceedings cannot be predicted, the Company does not believe these actions, in the aggregate, will have a material adverse impact on its financial position, results of operations or liquidity.

SOS Information Technology New York, Inc. ("SOSNY"), a company incorporated under the laws of state of New York and a wholly owned subsidiary of SOS Ltd., filed a December 9, 2022 lawsuit in the New York State Supreme Court against Thor Miner, Inc., which is Singularity's joint venture ("Thor Miner"), Singularity Future Technology Ltd. ("Singularity" or the "Company," and, together with Thor Miner, referred to as the "Corporate Defendants"), Lei Cao, Yang Jie, John F. Levy, Tieliang Liu, Tuo Pan, Shi Qiu, Jing Shan, and Heng Wang (jointly referred to as the "Individual Defendants") (collectively, the Individual Defendants and the Corporate Defendants are the "Defendants"). SOSNY and Thor Miner entered into a January 10, 2022 Purchase and Sale Agreement (the "PSA") for the purchase of $200,000,000 in crypto mining rigs, which SOSNY claims was breached by the Defendants.

SOSNY and Defendants entered into a certain settlement agreement and general mutual release with an Effective Date of December 28, 2022 ("Settlement Agreement"). Pursuant to the Settlement Agreement, Thor Miner agreed to pay a sum of thirteen million in U.S. dollars ($13,000,000) (the "Settlement Payment") to SOSNY in exchange for SOSNY dismissing the lawsuit with prejudice as to the settling Defendants and without prejudice as to all others. The full Settlement Payment was received by SOSNY on December 28, 2022. SOSNY dismissed the lawsuit with prejudice against Singularity (and other Defendants) on December 28, 2022.

Singularity and Thor Miner further covenanted and agreed that if they receive additional funds from HighSharp (Shenzhen Gaorui) Electronic Technology Co., Ltd. ("HighSharp") related to the PSA, they will promptly transfer such funds to SOSNY in an amount not to exceed forty million, five hundred sixty thousand, five hundred sixty-nine dollars ($40,560,569.00) (which is the total amount paid by SOSNY pursuant to the PSA less the price of the machines actually received by SOSNY pursuant to the PSA). The Settlement Payment and any payments subsequently received by SOSNY from HighSharp shall be deducted from the total amount of forty million, five hundred sixty thousand, five hundred sixty-nine dollars ($40,560,569.00) previously paid by, and now due and owing to SOSNY. In further consideration of the Settlement Agreement, Thor Miner agreed to execute and provide to SOSNY, within seven (7) business days after SOSNY's receipt of the Settlement Payment, an assignment of all claims it may have against HighSharp or otherwise to the proceeds of the PSA. See Note 19 for further details.

<u>Lawsuits in connection with the Securities Purchase Agreement</u>:

On September 23, 2022, Hexin Global Limited and Viner Total Investments Fund filed a lawsuit against the Company and other defendants in the United States District Court for the Southern District of New York (the "Hexin lawsuit"). On December 5, 2022, St. Hudson Group LLC, Imperii Strategies LLC, Isyled Technology Limited, and Hsqynm Family Inc. filed a lawsuit against the Company and other defendants in the United States District Court for the Southern District of New York (the "St. Hudson lawsuit," and together with the Hexin lawsuit, the "Investor Actions"). The plaintiffs in the Investor Actions are investors that entered into a securities purchase agreement ("Securities Purchase Agreement") with the Company in late 2021. Each of these plaintiffs asserts causes of action for, among other things, violations of federal securities laws, breach of fiduciary duty, fraudulent inducement, breach of contract, conversion, and unjust enrichment, and seeks monetary damages and specific performance to remove legends from certain securities sold pursuant to the Securities Purchase Agreement. The Hexin lawsuit claims monetary damages of "at least $6 million," plus interest, costs, fees, and attorneys' fees. The St. Hudson lawsuit claims monetary damages of "at least $4.4 million," plus interest, costs, fees, and attorneys' fees.

<u>Lawsuit in connection with the Financial Advisory Agreement</u>:

On October 6, 2022, Jinhe Capital Limited ("Jinhe") filed a lawsuit against the Company in the United States District Court for the Southern District of New York, asserting causes of actions for, among other things, breach of contract, breach of the covenant of good faith and fair dealing, conversion, quantum meruit, and unjust enrichment, in connection with a financial advisory agreement entered into by and between Jinhe and the Company on November 10, 2021. Jinhe claims monetary damages of "at least $575,000" and "potentially exceeding $1.8 million," plus interest, costs, and attorneys' fees.

On January 10, 2023, St. Hudson lawsuit was consolidated with this lawsuit and Hexin lawsuit; on February 24, 2023, all three consolidated actions were dismissed without prejudice by the court, in furtherance of the parties having reached an agreement in principle to settle their disputes.

<u>Putative Class Action</u>:

On December 9, 2022, Piero Crivellaro, purportedly on behalf of the persons or entities who purchased or acquired publicly traded securities of the Company between February 2021 and November 2022, filed a putative class action against the Company and other defendants in the United States District Court for the Eastern District of New York, alleging violations of federal securities laws related to alleged false or misleading disclosures made by the Company in its public filings. The plaintiff seeks unspecified damages, plus interest, costs, fees, and attorneys' fees. As this action is still in the early stage, the Company cannot predict the outcome.

In addition to the above litigations, the Company is also subject to additional contractual litigations as to which it is unable to estimate the outcome.

<u>Government Investigations</u>:

Following a publication issued by Hindenburg Research dated May 5, 2022, the Company received subpoenas from the United States Attorney's Office for the Southern District of New York and the United States Securities and Exchange Commission. The Company is cooperating with the government regarding these matters. At this early stage, the Company is not able to estimate the outcome or duration of the government investigations.

**Note 16. INCOME TAXES** 

On March 27, 2020, the CARES Act was enacted and signed into law and includes, among other things, refundable payroll tax credits, deferment of employer side social security payments, net operating loss carryback periods and alternative minimum tax credit refunds. The Company does not at present expect the provisions of the CARES Act to have a material impact on its tax provision given the amount of net operating losses currently available.

&nbsp;&nbsp;&nbsp;&nbsp;

The Company's income tax expenses for three months ended September 30, 2022 and 2021 are as follows:

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended <br> September 30** | **For the Three Months Ended <br> September 30** |
|  | **2022** | **2021** |
| Current |  |  |
| &nbsp;&nbsp;&nbsp;U.S. | $(103426) | $&nbsp;&nbsp;&nbsp;&nbsp; - |
| &nbsp;&nbsp;&nbsp;PRC | - | - |
| Total income tax expenses | (103426) | - |

---

The Company's deferred tax assets are comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30, <br> 2022** | **June 30, <br> 2022** |
| Allowance for credit losses |  |  |
| &nbsp;&nbsp;&nbsp;U.S. | $554000 | $617000 |
| &nbsp;&nbsp;&nbsp;PRC | 1719000 | 1830000 |
| Net operating loss |  |  |
| &nbsp;&nbsp;&nbsp;U.S. | 5293000 | 4628000 |
| &nbsp;&nbsp;&nbsp;PRC | 1362000 | 1283000 |
| Total deferred tax assets | 8928000 | 8358000 |
| Valuation allowance | (8928000) | (8358000) |
| Deferred tax assets, net - long-term | $- | $- |

---

The Company's operations in the U.S. incurred a cumulative U.S. federal net operation losses ("NOL") of approximately $22,000,000 as of June 30, 2022, which may reduce future federal taxable income. During the three months ended September 30, 2022, approximately $3,200,000 of NOL was generated and the tax benefit derived from such NOL was approximately $700,000. As of September 30, 2022, the Company's cumulative NOL amounted to approximately $25,200,000 which may reduce future federal taxable income, of which approximately $1,400,000 will expire in 2037 and the remaining balance carried forward indefinitely.

The Company's operations in China incurred a cumulative NOL of approximately $1,283,000 as of June 30, 2022 which was mainly from net loss. During the three months ended September 30, 2022, additional NOL of approximately $1,719,000 was generated. As of September 30, 2022, the Company's cumulative NOL amounted to approximately $1,362,000 which may reduce future taxable income which will expire by 2026.

The Company periodically evaluates the likelihood of the realization of deferred tax assets ("DTA") and reduces the carrying amount of the deferred tax assets by a valuation allowance to the extent it believes a portion will not be realized. Management considers new evidence, both positive and negative, that could affect the Company's future realization of deferred tax assets including its recent cumulative earnings experience, expectation of future income, the carry forward periods available for tax reporting purposes and other relevant factors. The Company determined that it is more likely than not its deferred tax assets could not be realized due to uncertainty on future earnings as a result of the company's reorganization and venture into new businesses. The Company provided a 100% allowance for its DTA as of September 30, 2022. The net increase in valuation for the three months ended September 30, 2022 amounted to approximately $570,000, based on management's reassessment of the amount of the Company's deferred tax assets that are more likely than not to be realized.

The Company's taxes payable consists of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| VAT tax payable | $2268251 | $1098862 |
| Corporate income tax payable | 1040883 | 2295803 |
| Others | 58580 | 62512 |
| Total | $3367714 | $3457177 |

---

**Note 17. CONCENTRATIONS**

 ****

***Major Customers***

For the three months ended September 30, 2022, one customer accounted for 86.5% of the Company's gross revenues. As of September 30, 2022, two customers accounted for 45.0% and 12.5% of the Company's accounts receivable, net.

For the three months ended September 30, 2021, one customer accounted for approximately 88.9% of the Company's revenues. As of September 30, 2021, three customers accounted for approximately 65.6% of the Company's accounts receivable, net.

 ****

***Major Suppliers***

For the three months ended September 30, 2022, one supplier accounted for approximately 84.8% of the gross purchases.

For the three months ended September 30, 2021, one supplier accounted for approximately 49.4% of the total costs of revenue.

**Note 18. SEGMENT REPORTING**

ASC 280, "Segment Reporting", establishes standards for reporting information about operating segments on a basis consistent with the Company's internal organizational structure as well as information about geographical areas, business segments and major customers in unaudited condensed consolidated financial statements for detailing the Company's business segments.

The Company's chief operating decision maker is the Chief Operating Officer, who reviews the financial information of the separate operating segments when making decisions about allocating resources and assessing the performance of the group. As of September 30, 2022, the Company has determined that it had two operating segments: (1) freight logistics services and (2) sales of crypto mining machines.

The following tables present summary information by segment for the three months ended September 30, 2022 and 2021, respectively:

---

| | | | |
|:---|:---|:---|:---|
|  | **For Three Months Ended <br> September 30, 2022** | **For Three Months Ended <br> September 30, 2022** | **For Three Months Ended <br> September 30, 2022** |
|  | **Freight<br> Logistics<br> Services** | **Sales of Crypto Mining<br> Machines** | **Total** |
| Net revenues | $724159 | $497045 | $1221204 |
| Cost of revenues | $745627 | $- | $745627 |
| Gross profit | $(21468) | $497045 | $475577 |
| Depreciation and amortization | $78945 | $- | $78945 |
| Total capital expenditures | $150966 | $- | $150966 |
| Gross margin% | (3.0)% | 100.0% | 38.9% |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Three Months Ended<br> September 30, 2021<br> (Restated)** | **For the Three Months Ended<br> September 30, 2021<br> (Restated)** | **For the Three Months Ended<br> September 30, 2021<br> (Restated)** |
|  | **Freight<br> Logistics<br> Services** | **Sales of Crypto Mining<br> Machines** | **Total** |
| Net revenues | $816010 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - | $816010 |
| Cost of revenues | $1046868 | $- | $1046868 |
| Gross profit | $(230858) | $- | $(230858) |
| Depreciation and amortization | $140710 | $- | $140710 |
| Total capital expenditures | $617147 | $- | $617147 |
| Gross margin% | (28.3)% | - | (28.3)% |

---

Total assets as of:

---

| | | |
|:---|:---|:---|
|  | <br>**September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Freight Logistic Services | 30853177 | 44058444 |
| Sales of crypto mining machines | 26463362 | 20789296 |
| Total Assets | $57316539 | $64847740 |

---

The Company's operations are primarily based in the PRC and U.S, where the Company derives all of its revenues. Management also reviews consolidated financial results by business locations.

Disaggregated information of revenues by geographic locations are as follows:

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** |
|  | <br>**September 30, 2022** | <br>**September 30,**<br>**2021 (Restated)** |
| PRC | $248210 | $725077 |
| U.S. | 972994 | 90933 |
| Total revenues | $1221204 | $816010 |

---

**Note 19. RELATED PARTY BALANCE AND TRANSACTIONS**

<u>Advance to suppliers-related party</u>

The Company's advances to suppliers – related party are as follows:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Bitcoin mining hardware and other equipment (1) | $1978368 | $6153546 |
| Total Advances to suppliers-related party | $1978368 | $6153546 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) On January 10, 2022, the Company's joint venture, Thor Miner,
entered into a Purchase Agreement with HighSharp. Pursuant to the Purchase Agreement, Thor Miner agreed to purchase certain cryptocurrency
mining equipment. In January and April 2022, Thor Miner made total prepayment of $35,406,649 for the order. $4,175,178 was shipped
in September 2022 and prepayment as of September 30, 2022 amounted to $1,978,368. The Company shipped products of $1,325,520 for the year ended June 2022 and $6,153,546 from July to December 2022. Due to production issues from HighSharp, Thor Miner was not able to
timely deliver the full quantity of cryptocurrency mining machines to SOSNY under the PSA according to contract and was sued by SOSNY
for breach of contract on December 9, 2022. On December 23, 2022, the Company entered into a settlement agreement with SOSNY effective on December 28, 2022, under which the Company would repay $13.0 million to SOSNY and terminate the previous agreements and balance of the deposits. The Company also assigned to SOSNY the right for the deposit that Thor Miner has paid to HighSharp. As of December 22, 2022, the balance of the advance to HighSharp and the deposit from SOSNY amounted to $27,927,583 and $40,560,569, respectively. Thor Miner paid $13.0 million on December 23, 2022 to SOSNY, which was received by SOSNY on December 28, 2022. Thor Miner wrote off the balance of the deposit it received from SOSNY and the balance of its payment to HighSharp resulted in net bad debt expenses of $367,014.

<u>Due from related party, net</u>

As of September 30, 2022 and June 30, 2022, the outstanding amounts due from related parties consist of the following:

---

| | | |
|:---|:---|:---|
|  | <br>**September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Zhejiang Jinbang Fuel Energy Co., Ltd (1) | 391100 | 415412 |
| Shanghai Baoyin Industrial Co., Ltd (2) | 1229570 | 1306004 |
| LSM Trading Ltd (3) | 570000 | 570000 |
| Rich Trading Co. Ltd (4) | 103424 | 103424 |
| Cao Lei (5) | 54026 | 54860 |
| Less: allowance for credit losses | (2348120) | (2449700) |
| Total | $- | $- |

---

(1) As of
September 30, 2022 and June 30, 2022, the Company advanced approximately $0.4 million to Zhejiang
Jinbang Fuel Energy Co., Ltd ("Zhejiang Jinbang") which is owned by Mr. Wang Qinggang, CEO and legal representative of Trans Pacific Shanghai. The advance is non-interest bearing and due on demand.. In December 2022, the Company further advanced
approximately $0.4 million to Zhejiang Jinbang. The Company provided full credit losses for the balance of the receivable as of September
30, 2022 and June 30, 2022.

(2) As of
September 30, 2022, t he Company advanced approximately $1.2 million to Shanghai
Baoyin Industrial Co., Ltd. which is 30% owned by Wang Qinggang, CEO and legal representative of Trans Pacific Shanghai. The advance is non-interest bearing and due on demand. The Company provided full credit losses for the balance of the receivable.

(3) The Company
advanced $570,000 to LSM Trading Ltd, which is 40% owned by the Company for the year ended June 30, 2022. The advance is non-interest
bearing and due on demand. The Company provided full credit losses for the balance of the receivable.

(4) On November 16, 2021, the Company entered into a project cooperation agreement with Rich Trading Co. Ltd USA ("Rich Trading") for the trading of computer equipment. Rich Trading's bank account was controlled by now-terminated members of the Company's management and was, at the time, an undisclosed related party. According to the agreement, the Company was to invest $4.5 million in the trading business operated by Rich Trading and the Company would be entitled to 90% of profits generated by the trading business. The Company advanced $3,303,424 for this project. $3,200,000 has been returned to the Company. The Company provided allowance of $103,424 for the year ended June 30, 2022.

(5) The amount represents advance for business expenses to Mr. Cao Lei, former Chairman of the Board.
 The Company provided full credit losses for the balance of the receivable.

<u>Loan receivable- related parties</u>

As of September 30, 2022 and June 30, 2022, the outstanding loan receivable from related parties consists of the following:

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |
| Wang, Qinggang (1) | $449697 | $552285 |

---

(1) On June 10, 2021, the Company entered into a loan agreement with Wang Qinggang, CEO and legal representative of Trans Pacific Shanghai. The loan is non-interest bearing for loan amounts up to $630,805 (RMB 4 million). In February 2022, Wang Qinggang, borrowed and repaid $232,340 of the loan amount. In June 2022, additional $522,285 (RMB 3,700,000) was loaned to Wang Qinggang. $70,265 (RMB 0.5 million) was returned in September 2022 and approximately $0.4 million(RMB 3.2 million) in December 2022.

**Note 20. SUBSEQUENT EVENTS**

On December 23, 2022, the Company entered into a settlement agreement with SOSNY pursuant to which the Company will repay $13.0 million to SOSNY and terminate the previous agreements and balance of the deferred revenue. The Company paid $13.0 million in December 2022 and the settlement was effective on December 28, 2022.

On January 9, 2023, the Company entered into an Executive Separation Agreement and General Release (the "Separation Agreement"), with Lei Cao, an employee of the Company and a member of the Board, setting forth the terms and conditions related to (1) the termination of Mr. Cao's employment with the Company and the termination of the employment agreement dated as of November 1, 2021 as well as cancellation and/or termination of certain other agreements relating to Mr. Cao's employment with the Company; and (2) Mr. Cao's resignation from the Board, effective as of January 9, 2023.

Pursuant to the Separation Agreement, Mr. Cao submitted a letter of resignation from the Board on January 9, 2023. In addition, he agreed to forfeit and return to the Company the 600,000 shares of common stock of the Company granted to him on August 13, 2021 under the terms of the 2014 Equity Incentive Plan of the Company (the "2021 Shares"). Mr. Cao also agreed to cooperate with the Company regarding certain investigations and proceedings set forth in the Separation Agreement, and/or any other matters arising out of or related to Mr. Cao's relationship with or service to the Company. In consideration, the Company agreed to provide the following benefits to which Mr. Cao was not otherwise entitled: (1) payment of reasonable attorneys' fees and costs incurred by Mr. Cao up through January 9, 2023 associated with Mr. Cao's personal legal representation in matters relating to Mr. Cao's tenure with the Company, the investigations and proceedings set forth in the Separation Agreement, and the negotiation and drafting of the Separation Agreement; (2) the release of claims in Mr. Cao's favor contained in the Separation Agreement; and (3) payment of Mr. Cao's reasonable and necessary legal fees to the extent incurred by Mr. Cao as a result of his cooperation as required by the Company under the terms of the Separation Agreement. Additionally, the Separation Agreement contains mutual general releases and waiver of claims from Mr. Cao and the Company.

On February 4, 2022, the Company approved a one-time award of a total of 500,000 shares of common stock under the Company's 2021 Stock Incentive Plan to certain executive officers of the Company, including Chief Executive Officer, Yang Jie (300,000 shares), Chief Operating Officer, Jing Shan (100,000 shares), and Chief Technology Officer, Shi Qiu (100,000 shares).

On December 27, 2022 and December 19, 2022, Jing Shan and Yang Jie each signed an cancellation agreement to return 100,000 and 300,000 share, respectively, to the Company for cancellation for no consideration. The cancellation agreements and the cancellation of shares underlying thereunder were ratified and approved by the Board on January 19, 2023. As of the date of this Report, the 300,000 shares issued to Mr. Jie were cancelled and the 100,000 shares were in the process of being cancelled.

**Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.** 

*The following discussion and analysis of the Company's financial condition and results of operations should be read in conjunction with our consolidated financial statements and the related notes included elsewhere in the report. This discussion contains forward-looking statements that involve risks and uncertainties. Actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of various factors.*

**Overview** 

We previously focused on providing customized freight logistic services, but starting in 2017, we began exploring new opportunities to expand our business and generate more revenue. These opportunities ranged from complementary businesses to other new service and product initiatives. In the fiscal years 2021 and 2022, while we continued to engage in our freight logistics business, we expanded our services to include warehousing services provided by our U.S. subsidiary Brilliant Warehouse Service Inc. On January 3, 2022, we changed our corporate name to Singularity Future Technology Ltd. to align with our entry into the digital assets business through our U.S. subsidiaries. During 2022, we were engaged in the purchase and sale of cryptocurrency mining machines through our U.S. subsidiary.

As of September 30, 2022, we operated in two operating segments, including (1) freight logistics services; (2) the purchase and sale of crypto mining machines through our subsidiary Thor Miner.

**Restatement of previously issued financial statements**

The Company discovered an error in the revenue recognition of its subsidiary, Sino-Global Shipping New York Inc., during the audit for the year ended June 30, 2022, where $980,200 of revenue recognized in freight logistics did not meet the revenue recognition criteria for the three months ended September 30, 2021.

In addition, in connection with the Company's restatement for the financial statements as of and for the year ended June 30, 2021, the Company also restated its recovery (provision) for doubtful accounts, net related to its other receivables.

---

| | | | |
|:---|:---|:---|:---|
|  | **As<br> Previously<br> Reported** | **Adjustments** | **As Restated** |
| **Consolidated statement of operations for the three months ended September 30, 2021** | | | |
| Net revenues | $1796210 | $(980200) | $816010 |
| Cost of revenues | (1626868) | 580000 | (1046868) |
| Recovery (provision) for doubtful accounts, net | 1929715 | (1895520) | 34195 |
| Net loss | $(2921662) | $(2295720) | $(5217382) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **As<br> Previously<br> Reported** | **Adjustments** | **As Restated** |
| **Consolidated statement of cash flow for the three months ended September 30, 2021** | | | |
| Cash flows from operating activities: |  |  |  |
| Net loss | $(2921662) | $(2295720) | $(5217382) |
| Provision for doubtful accounts | (1929715) | 1895520 | (34195) |

---

**COVID-19**

The outbreak of the COVID-19 virus ("COVID-19") starting from late January 2020 in the PRC has spread rapidly to many parts of the world. In March 2020, the World Health Organization declared COVID-19 as a pandemic. Given the continually expanding nature of the COVID-19 pandemic in China and the U.S., our business, results of operations, and financial condition are still adversely affected. The situation remains highly uncertain for any further outbreak or resurgence of COVID-19. It is therefore difficult for us to estimate the impact on our business or operating results that might be adversely affected by any further outbreak or resurgence of COVID-19.

The impacts of COVID-19 on our business, financial condition, and results of operations include, but are not limited to, the following:

● Our customers have been negatively impacted by the pandemic, which reduced their demand for freight logistics services. As a result, our revenue for the three months ended September 30, 2022 was down by approximately $0.1 million, or 11.3%.

● Due to travel restrictions between the U.S. and China, our joint ventures were unable to start operation as planned which has slowed down our new business development.

● Our sales of crypto mining machines were materially adversely affected by COVID-19. Specifically, Crypto mining machine manufacturers have been impacted by the constrained supply of the semiconductors used in the production of the highly specialized crypto mining machines; COVID-related issues have exacerbated port congestion and intermittent supplier shutdowns and delays, resulting in delayed shipments and additional expenses to expedite delivery; as a result, we were unable to fulfil our customer orders on a timely basis, resulting cancellation of orders and partial refund of purchase price, as evident from the settlement in SOSNY.

We have been, and may continue to be, negatively impacted by the ongoing COVID-19, which may continually impact our cost of freight, or result in higher cost of revenue, which may in turn materially adversely affect our financial condition and operating results in coming months.

**Results of Operations**

***Comparison of the Three Months Ended September 30, 2022 and 2021***

The following table sets forth the results of our operations for the periods indicated:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended September 30,** | **For the Three Months Ended September 30,** | **For the Three Months Ended September 30,** | **For the Three Months Ended September 30,** | **For the Three Months Ended September 30,** | **For the Three Months Ended September 30,** |
|  | **2022** | **2022** | **2021 <br> (Restated)** | **2021 <br> (Restated)** | **Change** | **Change** |
|  | **US $** | **%** | **US $** | **%** | **US $** | **%** |
| **Revenues** | 1221204 | 100.0% | 816010 | 100.0% | 405194 | 49.7% |
| **Cost of revenues** | 745627 | 61.1% | 1046868 | 128.3% | (301241) | (28.8)% |
| Gross margin | 38.9% | N/A | (28.3)% | N/A | 67.2% | N/A |
| Selling expenses | 27375 | 2.2% | 74396 | 9.1% | (47021) | (63.2)% |
| General and administrative expenses | 2988920 | 245.0% | 1966569 | 241.0% | 1022351 | 52.0% |
| Provision for doubtful accounts, net of recovery |  | 0% | (34195) | (4.2)% | 34195 | (100.0)% |
| Stock-based compensation | 247333 | 20.3% | 2927400 | 358.7% | (2680067) | (91.6)% |
| **Total costs and expenses** | 4009255 | 328.3% | 5981038 | 733.0% | (1971783) | (33.0)% |

---

***Revenues***

Revenues increased by $405,194, or approximately 49.7%, from $1,221,204 for the three months ended September 30, 2022 to $816,010 for the same period in 2021. The increase was primarily due to increase in sales of crypto mining machines.

The following tables present summary information by segments for the three months ended September 30, 2022 and 2021:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Three Months Ended September 30, 2022** | **For the Three Months Ended September 30, 2022** | **For the Three Months Ended September 30, 2022** |
|  | **Freight<br> Logistics<br> Services** | **Sales of Crypto Mining<br> Machines** | **Total** |
| Net revenues | $724159 | $497045 | $1221204 |
| Cost of revenues | $745627 | $- | $745627 |
| Gross profit | $(21468) | $497045 | $475577 |
| Depreciation and amortization | $78945 | $- | $78945 |
| Total capital expenditures | $150966 | $- | $150966 |
| Gross margin | (3.0)% | 100 .0% | 38.9% |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Three Months Ended September 30, 2021 (Restated)** | **For the Three Months Ended September 30, 2021 (Restated)** | **For the Three Months Ended September 30, 2021 (Restated)** |
|  | **Freight<br> Logistics<br> Services** | **Sales of Crypto Mining<br> Machines** | **Total** |
| Net revenues | $816010 | $&nbsp;&nbsp;&nbsp;&nbsp; - | $816010 |
| Cost of revenues | $1046868 | $- | $1046868 |
| Gross profit | $(230858) | $- | $(230858) |
| Depreciation and amortization | $140710 | $- | $140710 |
| Total capital expenditures | $617147 | $- | $617147 |
| Gross margin | (28.3)% | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -% | (28.3)% |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **% Changes For the Three Months Ended September 30, 2022 and 2021** | **% Changes For the Three Months Ended September 30, 2022 and 2021** | **% Changes For the Three Months Ended September 30, 2022 and 2021** |
|  | **Freight<br> Logistics<br> Services** | **Sales of Crypto Mining<br> Machines** | **Total** |
| Net revenues | (11.3)% | 100.0% | 49.7% |
| Cost of revenues | (28.8)% |  | (28.8)% |
| Gross profit | (90.7)% |  | (306.0)% |
| Depreciation and amortization | (43.9)% |  | (43.9)% |
| Total capital expenditures | (75.5)% |  | (75.5)% |
| Gross margin | 25.3% | 100.0% | 67.2% |

---

Disaggregated information of revenues by geographic locations are as follows:

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** |
|  | **September 30,**<br>**2022** | **September 30, 2021**<br>**(Restated)** |
| PRC | 248210 | 725077 |
| U.S. | 972994 | 90933 |
| Total revenues | $1221204 | $816010 |

---

**Revenues**

***Revenues from Freight Logistics Services***

 ****

Freight logistics services primarily consist of cargo forwarding, brokerage, warehouse and other freight services. Revenues from freight logistics services was $724,159 for the three months ended September 30, 2022, a decrease of $91,851, or approximately 11.3 %, as compared to $816,010 for the same period in 2021 as our revenue decreased.

Our freight logistics revenue decreased mainly due to a decrease in our PRC operations of approximately $0.5 million. The decrease in our PRC operations was due to the continuing impact of COVID-19 which has prevented us from actively developing new shipping contracts. The decrease was mainly offset by approximately $0.4 million revenue in the U.S. which mainly consists of warehouse services that we started last fiscal year by our subsidiaries as Gorgeous Trading Ltd. and Brilliant Warehouse Service, Inc., where we provided more warehouse and logistic services.

***Revenues from Sales of Crypto Mining Machines***

Our subsidiary, Thor Miner entered into a purchase and sale agreement with SOSNY in which Thor Miner agreed to sell to SOSNY certain cryptocurrency mining hardware and other equipment. Our vendor shipped the products to SOSNY directly, meaning we did not control the delivery and did not bear inventory risk. We recognized net revenue of $497,045. Gross revenue and cost of revenue amounted to $4,672,223 and $4,175,178 respectively for the three months ended September 30, 2022. The contract was terminated in December 2022.

***Cost of Revenues***

Cost of revenues for our freight logistics segment mainly consisted primarily of freight costs to various freight carriers, cost of labor, warehouse rent and other overhead and sundry costs. Cost of revenues for our freight logistic segment was $745,627 for the three months ended September 30, 2022, a decrease of $301,241, or approximately 28.8 %, as compared to $1,046,868 for the same period in 2021 as our revenue decreased. The decrease was mainly due to a decrease in freight cost as our revenue decreased.

Our gross margin was 38.9% and (28.3)% for the three months ended September 30, 2022 and 2021, respectively.

Our freight logistic margin increased from (28.3)% to (3.0)% because our subsidiary, Brilliant Warehouse, was in the startup stage for the three months ended September 30, 2021. This resulted higher fixed costs and a generation of insignificant revenue, compared to the three months ended September 30, 2022, in which Brilliant Warehouse was almost at breakeven. This consequently increased the overall margin for freight logistic segment.

The overall increase in our margin was due to the sales of crypto-mining machines that we started providing in 2022. We recognized this revenue on a net basis, thus increasing the overall margin of our operations.

**Operating Costs and Expenses**

Operating costs and expenses decreased by $1,971,783 or approximately 33.0%, from $5,981,038 for the three months ended September 30, 2021 to $4,009,255 for the three months ended September 30, 2022. This decrease was mainly due to the decrease in selling expenses and stock-based compensation, offset by the increase in general and administrative expenses as discussed below.

***Selling Expenses***

Our selling expenses consisted primarily of salaries for our sales representatives. For the three months ended September 30, 2022, we had $27,375 of selling expenses, compared to $74,396 for the same period in 2021, which represents an decrease of $47,021 or approximately (63.2)%. The decrease was mainly due to a decrease of approximately $47,625 in salaries for our PRC operations due to the impact of COVID-19.

***General and Administrative Expenses***

 

Our general and administrative expenses consist primarily of salaries and benefits, travel expenses for our administration department, office expenses, regulatory filing and professional service fees for auditing, legal and IT consulting. For the three months ended September 30, 2022, we had $2,988,920 of general and administrative expenses, compared to $1,966,569 for the same period in 2021, representing an increase of $1,022,351, or approximately 52.0%. The increase was mainly due to the increase in salaries and wages and office related costs of approximately $0.3 million as we hired more employees for our new subsidiaries such as Gorgeous Trading Ltd. and Brilliant Warehouse Service, Inc. This was also due to additional professional fees of approximately $1.6 million, most of which consist of legal fees.

***Stock-Based Compensation***

Our stock-based compensation was $247,333 for the three months ended September 30, 2022, a decrease of $2,680,067 or 91.6%, as compared to same period in 2021 due to a decrease in stock compensation grants to our employees.

***Other Expenses, Net***

The total of our other expenses, net was $58,849 for the three months ended September 30, 2022, an increase of approximately $6,495 or 12.4%, as compared to $52,354 for the same period in 2021. This change was caused by an increase in other interest expenses of approximately $60,000 for the three months ended September 30, 2022, compared to approximately $52,000 for our expenses for the three months ended September 30, 2021 which was mainly due to our disposal of fixed assets.

***Taxes***

Our income tax expenses amounted to $103,426 and nil for the three months ended September 30, 2022 and 2021, respectively.

We have incurred a cumulative U.S. federal net operating loss ("NOL") of approximately $22,000,000 as of June 30, 2022, which may reduce future federal taxable income. The NOL generated prior to the three months ended September 30, 2022 amounted to approximately $3,200,000. The tax benefit derived from this NOL was approximately $700,000. As of September 30, 2022, our cumulative NOL amounted to approximately $25,200,000. This may reduce our future federal taxable income, approximately $1,400,000 of which will expire in 2037. The remaining balance will be carried forward indefinitely.

Our operations in China have incurred a cumulative NOL of approximately $1,333,000 as of June 30, 2022, which was mainly from Sino China which was disposed of during the three months ended September 30, 2022. During the three months ended September 30, 2022, we generated an additional NOL of approximately $1,719,000. As of September 30, 2022, our PRC subsidiaries' cumulative NOL amounted to approximately 1,362,000 which may reduce future taxable income and will expire by 2026.

We periodically evaluate the likelihood of the realization of deferred tax assets, and reduce the carrying amount of the deferred tax assets by a valuation allowance to the extent it believes a portion will not be realized. Management considers new evidence, both positive and negative, that could affect our future realization of deferred tax assets including our recent cumulative earnings experience, expectation of future income, the carry forward periods available for tax reporting purposes and other relevant factors. We determined that it is more likely than not our deferred tax assets could not be realized due to uncertainty on future earnings as a result of the company's reorganization and venture into new businesses. We provided a 100% allowance for deferred tax assets as of September 30, 2022. The net decrease in valuation for the three months ended September 30, 2022 amounted to approximately $570,000 based on management's reassessment of the amount of our deferred tax assets that are more likely than not to be realized.

***Net Loss***

As a result of the foregoing, we had a net loss of $2,950,326 for the three months ended September 30, 2022, compared to $5,217,382 for the same period in 2021. After the deduction of non-controlling interest, net loss attributable to us was $3,084,352 for the three months ended September 30, 2022, compared to $4,961,180 for the same period in 2021. Comprehensive loss attributable to us was $2,930,353 for the three months ended September 30, 2022, as compared to $4,335,450 for the same period in 2021.

**Liquidity and Capital Resources**

 ****

***Cash Flows and Working Capital***

As of September 30, 2022, we had $52,460,203 in cash (including cash on hand and cash in bank). The majority of our cash is in banks located in the U.S.

On December 19, 2021, the Company issued two convertible notes to two non-U.S. investors for an aggregate purchase price of $10,000,000.

The convertible notes bear interest at 5% annually and may be converted into shares of the Company's common stock, no par value per share at a conversion price of $3.76 per share. At the investors' request, we prepaid $5,000,000 in the aggregate principal amount, without interest, of the convertible notes on March 8, 2022. Interest for the principal of $5,000,000 repaid was waived.

As of September 30, 2022, we had the following loans outstanding:

---

| | | | |
|:---|:---|:---|:---|
| **Loans** | **Maturities** | **Interest <br> rate** | **September 30,<br> 2022** |
| Convertible Notes | December 2023 | 5% | $5000000 |

---

The following table sets forth a summary of our cash flows for the periods as indicated:

---

| | | |
|:---|:---|:---|
|  | **For the Three Months <br> Ended September 30,** | **For the Three Months <br> Ended September 30,** |
|  | **2022** | **2021**<br> **(Restated)** |
| Net cash used in operating activities | $(3161398) | $(128960) |
| Net cash used in investing activities | $(80701) | $(2302448) |
| Net cash used in financing activities | $- | $(1776) |
| Effect of exchange rate fluctuations on cash | $(130980) | $544741 |
| Net decrease in cash | $(3373079) | $(1888443) |
| Cash at the beginning of period | $55833282 | $44837317 |
| Cash at the end of period | $52460203 | $42948874 |

---

The following table sets forth a summary of our working capital:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **September 30,**<br>**2022** | **June 30,**<br>**2022** |<br>**Variation** |<br>**%** |
| Total Current Assets | $55701113 | $63165462 | $(7464349) | (11.8)% |
| Total Current Liabilities | $20360422 | $25212959 | $(4852537) | (19.2)% |
| Working Capital | $35340691 | $37952503 | $(2611812) | (6.9)% |
| Current Ratio | 2.74 | 2.51 | 0.23 | 9.2% |

---

In assessing the liquidity, we monitor and analyze our cash on-hand and our operating and capital expenditure commitments. Our liquidity needs are to meet our working capital requirements, operating expenses and capital expenditure obligations. As of September 30, 2022, our working capital was approximately $35.3 million, and we had cash of approximately $52.4 million. We believe our current working capital is sufficient to support our operations and debt obligations as they become due within one year of the report date.

***Operating Activities***

Our net cash used in operating activities was approximately $3.2 million for the three months ended September 30, 2022. The operating cash outflow for the three months ended September 30, 2022 was primarily attributable to our net loss of approximately $3.0 million, adjusted by non-cash stock-based compensation of approximately $0.2 million. We had a decrease in cash inflow of other receivables of approximately $0.2 million and deferred revenue of approximately $4.6 million as we received the advanced payment for the sale of cryptocurrency equipment. Our cash inflow was decreased by an advance to a related party supplier of approximately $4.1 million which was for the purchase of cryptocurrency equipment.

Our net cash provided by operating activities was approximately $0.1 million for the three months ended September 30, 2021. The operating cash inflow for the three months ended September 30, 2021 was primarily attributable to our net loss of approximately $5.2 million, adjusted by non-cash stock-based compensation of approximately $2.9 million and $34,195 including recovery for doubtful accounts. We had an increase in cash inflow of other receivables of approximately $1.6 million as we collected our outstanding balances. We had an increase in advances to third party suppliers as we made advances to our suppliers of approximately $0.6 million, offset by a decrease in deferred revenue of approximately $0.4 million.

 ****

***Investing Activities***

Net cash provided by investing activities was approximately $80,701 for the three months ended September 30, 2022 due to the acquisition of property and equipment of approximately $0.2 million and a loan receivable of approximately $70,265 as related parties make payment on time.

Net cash used in investing activities was $2,302,448 for the three months ended September 30, 2021 due to the acquisition of property and equipment of approximately $0.6 million, advances to related parties of approximately $1.4 million and investment approximately $0.2 million to a joint venture named LSM Trading Ltd., in which we hold a 40% of equity interest, and advances to related parties of approximately $1.5 million.

 ****

***Financing Activities***

We did not have any financing activities for the three months ended September 30, 2022.

Net cash used in financing activities was approximately $1,776 for the three months ended September 30, 2021 due to the repayment of a loan payable.

**Critical Accounting Estimates**

The preparation of financial statements and related disclosures in conformity with U.S. generally accepted accounting principles and the Company's discussion and analysis of its financial condition and operating results require the Company's management to make judgments, assumptions and estimates that affect the amounts reported. Note 2, "Summary of Significant Accounting Policies" of the Notes to consolidated financial statements in the Company's Annual Report on Form 10-K for the year ended June 30, 2022 (the "2022 Form 10-K") describe the significant accounting policies and methods used in the preparation of the Company's consolidated financial statements. There have been no material changes to the Company's critical accounting estimates since the 2022 Form 10-K.

**Off-Balance Sheet Arrangements**

None.

**Item 3. Quantitative and Qualitative Disclosures about Market Risk**

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this item.

**Item 4. Controls and Procedures**

**Evaluation of Disclosure Controls and Procedures** 

We maintain controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

As of September 30, 2022, the Company carried out an evaluation, under the supervision of and with the participation of its management, including the Company's Chief Operating Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based on the foregoing evaluation, the Chief Operating Officer concluded that the Company's disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were not effective to ensure that the information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the applicable rules and forms due to ineffective internal controls over financial reporting that stemmed from the following material weaknesses:–

● Lack of segregation of duties for accounting personnel who prepared and reviewed the journal entries in some of the subsidiaries within the consolidation, lack of supervision, coordination and communication of financial information between different entities within the Company;

● Lack of a full time U.S. GAAP personnel in the accounting department to monitor and reconcile the recording of the transactions which led to error in revenue recognition in previously issued financial statements;

● Lack of resources with technical competency to address, review and record non-routine or complex transactions under U.S. GAAP;

● Lack of management control reviews of the budget against actual with analysis of the variance with a precision that can be explained through the analysis of the accounts;

● Lack of proper procedures in identifying and recording related party transactions which led to restatement of previously issued financial statements;

● Lack of a full time U.S. GAAP personnel in the accounting department to monitor and reconcile the recording of the transactions which led to error in revenue recognition in previously issued financial statements;

● Lack of proper procedures to maintain supporting documents for accounting records; and

● Lack of proper oversight for the Company's cash disbursement process that led to misuse of the Company funds by its former executive.

In order to remediate the material weaknesses stated above, we intend to explore implementing additional policies and procedures, which may include:

● Hiring additional accounting staff to report the internal financial timely;

● Hiring a Chief Executive Officer and Chief Financial Officer to properly set up the Company's internal control and oversight process;

● Reporting other material and non-routine transactions to the Board and obtain proper approval;

● Recruiting additional qualified professionals with appropriate levels of U.S. GAAP knowledge and experience to assist in resolving accounting issues in non-routine or complex transactions;

● Developing and conducting U.S. GAAP knowledge, SEC reporting and internal control training to senior executives, management personnel, accounting departments and the IT staff, so that management and key personnel understand the requirements and elements of internal control over financial reporting mandated by the U.S. securities laws;

● Setting up budgets and developing expectations based on understanding of the business operations, compare the actual results with the expectations periodically and document the reasons of the fluctuations with further analysis. This should be done by the Chief Financial Officer and reviewed by the Chief Executive Officer, upon their communications with the Board;

● Strengthening corporate governance;

● Setting up policies and procedures for the Company's related party identification to properly identify, record and disclose related party transactions; and

● Setting up proper procedures for the Company's fund disbursement process to ensure that cash is disbursed only upon proper authorization, for valid business purposes, and that all disbursements are properly recorded.

**Changes in Internal Control over Financial Reporting.** 

There were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the quarter ended September 30, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**PART II. OTHER INFORMATION**

**Item 1. Legal Proceedings**

For a discussion of our legal proceedings, see the information in Part I, "Item 1. Business – Recent Developments" in our Annual Report on Form 10-K for the fiscal year ended June 30, 2022. There have been no material changes to the legal proceedings disclosed in our 2022 Form 10-K.

Other than the items disclosed in our 2022 Form 10-K in "Item 1. Business – Recent Developments," there are no other legal proceedings currently pending against us, or known to be contemplated by any governmental agency, which we believe would have a material effect on our business, financial position or results of operations.

**Item 1A. Risk Factors**

As of the date of this Quarterly Report, there have been no material changes to the risk factors disclosed in our (i) Registration Statement on Form S-3, filed with the SEC on March 3, 2021, (ii) Annual Report on Form 10-K for the fiscal year ended June 30, 2022, as filed with the SEC on March 6, 2023. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations. We may disclose changes to such risk factors or disclose additional risk factors from time to time in our future filings with the SEC.

**Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.**

None.

**Item 3. Defaults Upon Senior Securities.** 

None.

**Item 4. Mine Safety Disclosures**

Not applicable.

**Item 5. Other Information.**

None.

**Item 6. Exhibits**

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q:

---

| | |
|:---|:---|
| **Number** | **Exhibit** |
| 31\* | [Certification of the Principal Executive Officer and Principal Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](f10q0922ex31_singularity.htm) |
| 32\*\* | [Certification of the Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.](f10q0922ex32_singularity.htm) |
| 101.INS\* | Inline XBRL Instance Document. |
| 101.SCH\* | Inline XBRL Taxonomy Extension Schema Document. |
| 101.CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
| 101.DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document. |
| 101.LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document. |
| 101.PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
| 104\* | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |

---

\* Filed herewith. <br> \*\* Furnished herewith.

**SIGNATURES**

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **SINGULARITY FUTURE TECHNOLOGY, LTD.** | **SINGULARITY FUTURE TECHNOLOGY, LTD.** |
| March 6, 2023 | By: | /s/ Jing Shan |
|  |  | Jing Shan |
|  |  | Chief Operating Officer<br> (Principal Executive Officer and Principal<br> Financial and Accounting Officer) |

---

0.15 0.32 15670135 21216739 In fiscal year 2019 and 2020, the Company entered into certain contracts with customers (state-owned entities in China) where the Company's services included freight costs and cost of commodities to be shipped to customers' designated locations. The Company prepaid the costs of commodities and recognized as advance payments on behalf of its customers. These advance payments on behalf of the customers will be repaid to the Company when either the contract terms expire or the contracts are terminated by either party. As aforementioned customers were negatively impacted by the pandemic and required additional time to execute existing contracts, they required additional time to pay. Due to significant uncertainty on whether the delayed contracts will be executed timely, the Company had provided an allowance due to contract delay and recorded allowances of approximately $6.0 million as of June 30, 2021. The advanced freight fee is the Company's prepayment made for various shipping costs for shipments from October 1 2022 to March 31 2023. For the three months ended September 30, 2022, the Company provided allowance of $300,000 same as the year ended June 30, 2022. On January 10, 2022, the Company's joint venture, Thor Miner, entered into a Purchase Agreement with HighSharp. Pursuant to the Purchase Agreement, Thor Miner agreed to purchase certain cryptocurrency mining equipment. In January and April 2022, Thor Miner made total prepayment of $35,406,649 for the order. $4,175,178 was shipped in September 2022 and prepayment as of September 30, 2022 amounted to $1,978,368. The Company shipped products of $1,325,520 for the year ended June 2022 and $6,153,546 from July to December 2022. Due to production issues from HighSharp, Thor Miner was not able to timely deliver the full quantity of cryptocurrency mining machines to SOSNY under the PSA according to contract and was sued by SOSNY for breach of contract on December 9, 2022. The Company entered into settlement agreement SOSNY effective on December 28, 2022, under which the Company will repay $13.0 million to SOSNY and terminate the previous agreements and balance of the deposits. The Company also assigned to SOSNY the right for the deposit that Thor Miner has paid to HighSharp. As of December 22, 2022, the balance of advance to HighSharp and deposit from SOSNY amounted to $27,927,583 and $40,560,569, respectively. Thor paid $13.0 million on December 23, 2022 to SOSNY and wrote off the balance of the deposit it received from SOSNY and the balance of its payment to HighSharp result in net bad debt expenses of $367,014. As of September 30, 2022 and June 30, 2022, the Company advanced approximately $0.4 million to Zhejiang Jinbang Fuel Energy Co., Ltd ("Zhejiang Jinbang") which is owned by Mr. Wang Qinggang, CEO and legal representative of Trans Pacific Logistic Shanghai Ltd. The advance is non-interest bearing and due on demand.. In December 2022, the Company further advanced approximately $0.4 million to Zhejiang Jinbang. The Company provided full credit losses for the balance of the receivable as of September 30, 2022 and June 30, 2022. As of September 30, 2022, the Company advanced approximately $1.2 million to Shanghai Baoyin Industrial Co., Ltd. which is 30% owned by Wang Qinggang, CEO and legal representative of Trans Pacific Logistic Shanghai Ltd. The advance is non-interest bearing and due on demand. The Company provided full credit losses for the balance of the receivable. The Company advanced $570,000 to LSM Trading Ltd, which is 40% owned by the Company for the year ended June 30, 2022. The advance is non-interest bearing and due on demand. The Company provided full credit losses for the balance of the receivable. On November 16, 2021, the Company entered into a project cooperation agreement with Rich Trading Co. Ltd USA ("Rich Trading") for trading of computer equipment. Rich Trading was controlled by now-terminated members of the Company's management and was, at the time, an undisclosed related party transaction. According to the agreement, the Company is to invest $4.5 million in the trading business operates by Rich Trading and the Company will be entitled to 90% of profit generated by the trading business. The Company advanced $3,303,424 for this project. Due to impact of COVID-19 which affected the supply chain, the Company decided to terminate the project. $3,200,000 has been return to the Company. The Company provided allowance of $103,424 for the year ended June 30, 2022. The amount represents business advance to Mr. Cao Lei, former Chairman of the Board. 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## Ex-31

**Exhibit 31**

**CERTIFICATIONS REQUIRED BY**

**RULE 13a-14(a)/15d-14(a), AS ADOPTED PURSUANT TO**

**SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Jing Shan, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Singularity Future Technology Ltd. (the "registrant") for the quarterly period ended September 30, 2022;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under my supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to me by others within those entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under my supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report my conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the registrant's auditor and the audit committee of the registrant's board of directors:

&nbsp;&nbsp;&nbsp;&nbsp;(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

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| | | |
|:---|:---|:---|
| Date: March 6, 2023 | By: | /s/ Jing Shan |
|  |  | Jing Shan |
|  |  | Chief Operating Officer |
|  |  | *(Principal Executive Officer and Principal Financial and Accounting Officer)* |

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## Ex-32

**Exhibit 32**

**CERTIFICATION PURSUANT TO**

**18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

In connection with the Quarterly Report on Form 10-Q of Singularity Future Technology Ltd. (the "Company") for the quarterly period ended September 30, 2022, as filed with the Securities and Exchange Commission (the "Report"), I, Jing Shan, Chief Operating Officer of the Company, certify, based on my knowledge, pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of and for the period covered by the Report.

---

| | | |
|:---|:---|:---|
| Date: March 6, 2023 | By: | /s/ Jing Shan |
|  |  | Jing Shan |
|  |  | Chief Operating Officer |
|  |  | *(Principal Executive Officer and Principal Financial and Accounting Officer)* |

---