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 ~~March 31,~~September 30, 2023

☐ 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

Singularity Future Technology Ltd.

(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

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 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 ☐
	Non-accelerated filer ☒	Smaller reporting company ☒
		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 ~~May 15,~~November 13, 2023, the Company had ~~18,844,333~~17,515,526 shares of common stock issued and outstanding.

SINGULARITY FUTURE TECHNOLOGY LTD.

FORM 10-Q

TABLE OF CONTENTS

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		ii

PART I.	FINANCIAL INFORMATION	1

Item 1.	Financial Statements	1

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3128

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	4437

Item 4.	Controls and Procedures	4437

PART II.	OTHER INFORMATION	4639

Item 1.	Legal Proceedings	4639

Item 1A.	Risk Factors	4641

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	4641

Item 3.	Defaults Upon Senior Securities	4641

Item 4.	Mine Safety Disclosures	4641

Item 5.	Other Information	4641

Item 6.	Exhibits	4741

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.

PART I. FINANCIAL INFORMATION

Item 1. Financial ~~Information.~~Statements

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(IN U.S. DOLLARS)

(UNAUDITED)

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Assets
Current assets
Cash	$	21,609,701		$	55,833,282		$	10,054,652		$	17,390,156
Cryptocurrencies		75,657			90,458			-			72,179
Accounts receivable, net		226,290			108,381			214,166			198,553
Other receivables, net		19,348			25,057			83,638			76,814
Advances to suppliers - third parties, net		102,403			36,540			59,416			128,032
Advances to suppliers - related party		-			6,153,546			-			-
Prepaid expenses and other current assets		455,025			365,913			250,717			252,047
Due from related party, net		292,195			-			26,115			74,935
Loan receivable-related parties, net		-			552,285
Total Current Assets		22,780,619			63,165,462			10,688,704			18,192,716

Property and equipment, net		495,329			548,956			388,198			426,343
Right-of-use assets, net		473,513			732,744			285,089			381,982
Other long-term assets - deposits		238,806			237,749			188,157			236,766
Investment in unconsolidated entity		-			162,829
Total Assets	$	23,988,267		$	64,847,740		$	11,550,148		$	19,237,807

Liabilities and Equity

Current Liabilities
Deferred revenue	$	205,477		$	6,955,577		$	66,354		$	66,531
Refund payable		-			13,000,000
Accounts payable		447,966			508,523			633,238			494,329
Accounts payable -related party		63,434			63,434
Accounts payable - related party								63,434			63,434
Lease liabilities - current		341,922			471,976			260,134			330,861
Taxes payable		3,535,928			3,457,177			3,323,204			3,334,958
Other payable -related party		110,842			-
Other payable - related party								104,647			104,962
Accrued expenses and other current liabilities		654,371			756,272			216,731			636,694
Convertible notes		5,000,000			-
Total current liabilities		10,359,940			25,212,959			4,667,742			5,031,769

Lease liabilities - noncurrent		356,221			846,871			187,617			245,171
Loan payable-noncurrent		-			5,000,000


Convertible notes								-			5,000,000
Total liabilities		10,716,161			31,059,830			4,855,359			10,276,940

Commitments and Contingencies

Equity
Preferred stock, 2,000,000 shares authorized, no par value, no shares issued and outstanding as of March 31, 2023 and June 30, 2022, respectively		-			-
Common stock, 50,000,000 shares authorized, no par value; 21,244,333 and 22,244,333 shares issued and outstanding as of March 31, 2023 and June 30, 2022, respectively		94,332,048			96,127,691
Preferred stock, 2,000,000 shares authorized, no par value, no shares issued and outstanding as of September 30, 2023 and June 30, 2023, respectively								-			-
Common stock, 50,000,000 shares authorized, no par value; 15,715,526 and 17,715,526 shares issued and outstanding as of September 30, 2023 and June 30, 2023, respectively								94,332,048			94,332,048
Additional paid-in capital		2,334,962			2,334,962			2,334,962			2,334,962
Accumulated deficit		(81,319,207	)		(62,579,592	)		(87,866,623	)		(85,576,438	)
Accumulated other comprehensive income		110,261			45,739			213,217			90,236
Total Stockholders' Equity attributable to controlling shareholders of the Company		15,458,064			35,928,800
Total Stockholders’ Equity attributable to controlling shareholders of the Company								9,013,604			11,180,808

Non-controlling Interest		(2,185,958	)		(2,140,890	)		(2,318,815	)		(2,219,941	)

Total Equity		13,272,106			33,787,910			6,694,789			8,960,867

Total Liabilities and Equity	$	23,988,267		$	64,847,740		$	11,550,148		$	19,237,807

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(IN U.S. DOLLARS)

(UNAUDITED)

	For the Three Months Ended						For the Nine Months Ended						For the Three Months Ended
	March 31,						March 31,						September 30,
	2023			2022			2023			2022			2023			2022

Net revenues	$	759,905		$	971,747		$	3,472,040		$	2,829,682		$	895,926		$	1,221,204
Cost of revenues		(888,040	)		(901,275	)		(2,944,804	)		(2,973,034	)		(1,002,949	)		(745,627	)
Gross (loss) profit		(128,135	)		70,472			527,236			(143,352	)
Gross profit (loss)														(107,023	)		475,577

Selling expenses		(39,661	)		(131,404	)		(93,884	)		(403,025	)		(55,853	)		(27,375	)
General and administrative expenses		(3,496,247	)		(2,140,749	)		(10,219,951	)		(6,258,749	)		(2,054,153	)		(2,988,920	)
Impairment loss of investment		(128,370	)		-			(128,370	)		-
Impairment loss of cryptocurrencies		-			(3,052	)		(14,801	)		(53,179	)		(72,179	)		-
Recovery (provision) for doubtful accounts, net		54,958			(669,189	)		47,805			(530,311	)
Provision for doubtful accounts, net														(48,618	)		-
Stock-based compensation		-			(6,512,889	)		(329,777	)		(9,817,289	)		-			(247,333	)
Total operating expenses		(3,609,320	)		(9,457,283	)		(10,738,978	)		(17,062,553	)		(2,230,803	)		(3,263,628	)

Operating loss		(3,737,455	)		(9,386,811	)		(10,211,742	)		(17,205,905	)		(2,337,826	)		(2,788,051	)

Loss from disposal of subsidiary and VIE		-			-			-			(6,131,616	)
Lawsuit settlement expenses		(8,400,491	)		-			(8,400,491	)		-
Other income (expenses), net		95,319			(35,709	)		(24,161	)		(117,944	)
Other expenses, net														(77,170	)		(58,849	)

Net loss before provision for income taxes		(12,042,627	)		(9,422,520	)		(18,636,394	)		(23,455,465	)		(2,414,996	)		(2,846,900	)

Income tax expense		-			-			(103,426	)		-			-			(103,426	)

Net loss		(12,042,627	)		(9,422,520	)		(18,739,820	)		(23,455,465	)		(2,414,996	)		(2,950,326	)

Net (loss) income attributable to non-controlling interest		(119,860	)		7,539			(205	)		(303,651	)		(124,811	)		134,026

Net loss attributable to controlling shareholders of the Company.	$	(11,922,767	)	$	(9,430,059	)	$	(18,739,615	)	$	(23,151,814	)	$	(2,290,185	)	$	(3,084,352	)

Comprehensive loss
Net loss	$	(12,042,627	)	$	(9,422,520	)	$	(18,739,820	)	$	(23,455,465	)	$	(2,414,996	)	$	(2,950,326	)
Other comprehensive (loss) income - foreign currency		(90,435	)		407,373			19,659			683,378
Other comprehensive income - foreign currency														148,918			152,769
Comprehensive loss		(12,133,062	)		(9,015,147	)		(18,720,161	)		(22,772,087	)		(2,266,078	)		(2,797,557	)
Less: Comprehensive (loss) income attributable to non-controlling interest		(127,115	)		151,576			(45,068	)		(133,384	)		(98,874	)		132,796
Comprehensive loss attributable to controlling shareholders of the Company	$	(12,005,947	)	$	(9,166,723	)	$	(18,675,093	)	$	(22,638,703	)	$	(2,167,204	)	$	(2,930,353	)

Loss per share
Basic and diluted	$	(0.56	)	$	(0.47	)	$	(0.88	)	$	(1.34	)	$	(0.13	)	$	(0.15	)

Weighted average number of common shares used in computation
Basic and diluted		21,244,333			20,226,126			21,233,263			17,278,637			17,598,135			21,216,739

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(IN U.S. DOLLARS)

(UNAUDITED)

Preferred Stock Common Stock Additional
paid-in Shares to Accumulated Accumulated
other
comprehensive Noncontrolling
Shares Amount Shares Amount capital be issued deficit loss interest Total
BALANCE, June 30, 2021 (Restated) - $ - 15,132,113 $ 82,555,700 $ 2,334,962 $ - $ (34,321,762 ) $ (729,096 ) $ (7,415,631 ) $ 42,424,173
Stock compensation issue to employee - - 1,020,000 2,927,400 - - - - - 2,927,400
Foreign currency translation - - - - - - - 625,730 (7,969 ) 617,761
Net loss - - - - - - (4,961,180 ) - (256,202 ) (5,217,382 )
BALANCE, September 30, 2021 (Restated) - - 16,152,113 85,483,100 2,334,962 - (39,282,942 ) (103,366 ) (7,679,802 ) 40,751,952
Stock compensation issue to former director - - 100,000 377,000 - - - - - 377,000
Issuance of common stock to private investors - - 1,400,000 - - 4,563,908 - - - 4,563,908
Foreign currency translation - - - - - - - (375,955 ) 34,199 (341,756 )
Disposal of VIE and subsidiaries - - - - - - - - 5,919,050 5,919,050
Net loss - - - - - - (8,760,575 ) - (54,988 ) (8,815,563 )
BALANCE, December 31, 2021 (Restated) - - 17,652,113 85,860,100 2,334,962 4,563,908 (48,043,517 ) (479,321 ) (1,781,541 ) 42,454,591
Issuance of common stock to private placement - - 2,328,807 5,961,911 - - - - - 5,961,911
Stock based compensation to employee - - 500,000 2,740,000 - - - - - 2,740,000
Stock based compensation to consultants - - 900,000 3,772,889 - - - - - 3,772,889
Cashless exercise of stock warrants - - 599,413 - - - - - - -
Issuance of common stock to private investors - - - 4,563,908 - (4,563,908 ) - - - -
Warrant repurchase - - - (7,948,000 ) - - - - - (7,948,000 )
Foreign currency translation - - - - - - - 263,336 144,037 407,373
Net loss - - - - - - (9,430,059 ) - 7,539 (9,422,520 )
BALANCE, March 31, 2022 - $ - 21,980,333 $ 94,950,808 $ 2,334,962 $ - $ (57,473,576 ) $ (215,985 ) $ (1,629,965 ) $ 37,966,244

	Preferred Stock				Common Stock				Additional paid-in		Shares to		Accumulated			Accumulated other comprehensive		Noncontrolling
	Shares		Amount		Shares		Amount		capital		be cancelled		deficit			loss		interest			Total
BALANCE, June 30, 2022		-	$	-		22,244,333	$	96,127,691	$	2,334,962		-	$	(62,579,592	)	$	45,739	$	(2,140,890	)	$	33,787,910
Stock based compensation to consultants		-		-		-		247,333		-		-		-			-		-			247,333
Foreign currency translation		-		-		-		-		-		-		-			153,999		(1,230	)		152,769
Net loss		-		-		-		-		-		-		(3,084,352	)		-		134,026			(2,950,326	)
BALANCE, September 30, 2022		-		-		22,244,333		96,375,024		2,334,962		-		(65,663,944	)		199,738		(2,008,094	)		31,237,686

	Preferred Stock				Common Stock						Additional paid-in		Shares to			Accumulated			Accumulated other comprehensive			Noncontrolling						Preferred Stock				Common Stock					Additional paid-in		Shares to			Accumulated			Accumulated other comprehensive		Noncontrolling
	Shares		Amount		Shares			Amount			capital		be cancelled			deficit			loss			interest			Total			Shares		Amount		Shares			Amount		capital		be cancelled			deficit			loss		interest			Total
BALANCE, June 30, 2022		-	$	-		22,244,333		$	96,127,691		$	2,334,962		-		$	(62,579,592	)	$	45,739		$	(2,140,890	)	$	33,787,910
BALANCE, June 30, 2023																													-	$	-		17,715,526			94,332,048		2,334,962		(200,000	)		(85,576,438	)		90,236		(2,219,941	)		8,960,867
Stock based compensation to consultants		-		-		-			247,333			-		-			-			-			-			247,333			-		-		-			-		-		-			-			-		-			-
Foreign currency translation		-		-		-			-			-		-			-			153,999			(1,230	)		152,769			-		-		-			-		-		-			-			122,981		25,937			148,918
Cancellation of shares due to settlement																													-		-		(200,000	)		-		-		200,000			-			-		-			-
Net loss		-		-		-			-			-		-			(3,084,352	)		-			134,026			(2,950,326	)		-		-		-			-		-		-			(2,290,185	)		-		(124,811	)		(2,414,996	)
BALANCE, September 30, 2022		-		-		22,244,333			96,375,024			2,334,962		-			(65,663,944	)		199,738			(2,008,094	)		31,237,686
Stock based compensation to consultants		-		-		-			82,444			-		-			-			-			-			82,444
Foreign currency translation		-		-		-			-			-		-			-			(6,297	)		(36,378	)		(42,675	)
Net loss		-		-		-			-			-		-			(3,732,496	)		-			(14,371	)		(3,746,867	)
BALANCE, December 31, 2022		-		-		22,244,333			96,457,468			2,334,962		-			(69,396,440	)		193,441			(2,058,843	)		27,530,588
Cancellation of stock compensation		-		-		(1,000,000	)		-			-		-			-			-			-			-
Cancellation of shares due to settlement		-		-		-			(2,125,420	)		-		(3,728,807	)		-			-			-			(2,125,420	)
Foreign currency translation		-		-		-			-			-		-			-			(83,180	)		(7,255	)		(90,435	)
Net loss		-		-		-			-			-		-			(11,922,767	)		-			(119,860	)		(12,042,627	)
BALANCE, March 31, 2023		-	$	-		21,244,333		$	94,332,048		$	2,334,962		(3,728,807	)	$	(81,319,207	)	$	110,261		$	(2,185,958	)	$	13,272,106
BALANCE, September 30, 2023																													-		-		17,515,526			94,332,048		2,334,962		-			(87,866,623	)		213,217		(2,318,815	)		6,694,789

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN U.S. DOLLARS)

(UNAUDITED)

	For the Nine Months Ended March 31,						For the Three Months Ended September 30,
	2023			2022			2023			2022
Operating Activities
Net loss	$	(18,739,820	)	$	(23,455,465	)	$	(2,414,996	)	$	(2,950,326	)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock-based compensation		329,777			9,817,289			-			247,333
Depreciation and amortization		122,699			428,635			38,127			78,945
Non-cash lease expense		260,153			357,828			97,437			135,215
(Recovery) provision for doubtful accounts, net		(47,805	)		530,311
(Gain) loss on disposal of ROU		(178,408	)		-
Loss on disposal of fixed assets		(6,481	)		56,827
Loss on disposal of subsidiaries		-			6,131,616
Impairment loss of investment		128,370			-
Provision for doubtful accounts, net								48,618			-
Impairment loss of cryptocurrencies		14,801			53,179			72,179			1,521
Investment loss from unconsolidated subsidiary		34,459			-			-			2,614
Interest expenses related to convertible note								21,917			-
Changes in assets and liabilities
Accounts receivable		7,792			(68,739	)		48,656			6,278
Other receivables		288,532			1,413,876			142,854			235,392
Advances to suppliers - third parties		(64,930	)		436,678			73,735			(7,304	)
Advances to suppliers - related party		6,153,546			(21,446,649	)		-			4,175,178
Prepaid expenses and other current assets		(89,113	)		(28,371	)		1,330			(98,287	)
Other long-term assets - deposits		317			(121,069	)		49,999			327
Deferred revenue		(6,753,612	)		26,656,890			(1,849	)		(4,619,813	)
Refund payable		(13,000,000	)		13,000,000			-			-
Accounts payable		(79,874	)		21,648			122,777			102,101
Taxes payable		(80,184	)		133,239			(130,215	)		(90,808	)
Lease liabilities		(442,929	)		(345,169	)		(128,825	)		(107,853	)
Accrued expenses and other current liabilities		(118,694	)		133,666			(41,712	)		(271,911	)
Net cash (used in) provided by operating activities		(32,261,404	)		13,706,220
Net cash used in operating activities								(1,999,968	)		(3,161,398	)

Investing Activities
Acquisition of property and equipment		(154,500	)		(775,107	)		-			(150,966	)
Proceeds from disposal of property and equipment		90,000			-
Loan receivable-related parties		587,612			-			-			70,265
Investment in unconsolidated entity		-			(210,010	)
Advance to related parties		(444,019	)		(5,069,328	)
Repayment from related parties		670,733			-			49,969			-
Net cash provided by (used in) investing activities		749,826			(6,054,445	)		49,969			(80,701	)

Financing Activities
Repayment of loan payable		-			(155,405	)
Proceeds from issuance of common stock		-			10,525,819
Proceeds from convertible notes		-			10,000,000
Repayment of convertible notes		-			(5,000,000	)		(5,000,000	)		-
Payment of legal settlement to cancel shares		(2,125,420	)		-
Warrant repurchase		-			(7,948,000	)
Net cash (used in) provided by financing activities		(2,125,420	)		7,422,414
Repayment of interest expenses related to convertible notes								(403,424	)		-
Net cash used in financing activities								(5,403,424	)		-

Net decrease in cash								(7,353,423	)		(3,242,099	)

Cash at beginning of period								17,390,156			55,833,282

Effect of exchange rate fluctuations on cash		(586,583	)		434,900			17,919			(130,980	)

Net (decrease) increase in cash		(34,223,581	)		15,509,089

Cash at beginning of period		55,833,282			44,837,317

Cash at end of period	$	21,609,701		$	60,346,406		$	10,054,652		$	52,460,203

Supplemental information
Interest paid	$	-		$	2,404

Non-cash transactions of operating and investing activities
Initial recognition of right-of-use assets and lease liabilities	$	-		$	1,384,721		$	-		$	-

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the ~~Nine~~Three Months ended ~~March 31,~~September 30, 2023

Note 1. ORGANIZATION AND NATURE OF BUSINESS

The Company is ~~a global~~an integrated logistics ~~integrated~~ solution provider that was ~~incorporated~~founded in the United States in 2001. On September 18, 2007, the Company ~~amended its Articles of Incorporation and Bylaws to merge~~merged 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 then expanded operations into the digital assets business.

~~The Company conducts its business~~ Currently, we primarily through its wholly-owned subsidiaries in the PRC (including Hong Kong) and the United States, where the majority of its clients are located. For the nine months ended March 31, 2023, the Company operated in two segments: (1)focus on providing freight logistics services, which ~~were~~include shipping, warehouse services and other logistical support to steel companies .

In 2017, we began exploring new opportunities to expand our business and generate more revenue. These opportunities ranged from complementary businesses to other new services and product initiatives. Beginning in fiscal 2022, we expanded our services to include warehousing services provided by our U.S. subsidiary Brilliant Warehouse Service Inc.

We are currently engaged in providing freight logistics services including warehouse services, which are operated by ~~its~~our subsidiaries ~~in both the United States~~Trans Pacific Shipping Limited and PRC, and (2) the sale of crypto-mining machines, which were operated by its subsidiaries in the United States. For the three months ended March 31, 2023, the Company did not sell crypto-mining machines. On Feb 27, 2023, Ningbo Saimeinuo Supply Chain Management Ltd. changed its name to Ningbo Saimeinuo Web Technology Ltd. ~~On March 30, 2023, the board of directors of the Company authorized the Company to conduct an e-commerce business in China.~~

The outbreak of the novel coronavirus (COVID-19) starting in late January 2020 in the PRC 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 Gorgeous Trading Ltd. and Brilliant Warehouse Service Inc. in the ~~U.S. Given the rapidly expanding nature~~United States. Our range of ~~the COVID-19 pandemic,~~services include transportation, warehouse, collection, last-mile delivery, drop shipping, customs clearance, 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 measures for COVID-19, which led to a surge in increased infections and disruption in our business operations. Any future impact of COVID-19 on our operating results in China 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.overseas transit delivery.

As of ~~March 31,~~September 30, 2023, the Company’s subsidiaries included the following:

Name	Background		Ownership
Sino-Global Shipping New York Inc. (“SGS NY”)	●	A New York corporation	100% owned by the Company
	●	Incorporated on May 03, 2013
	●	Primarily engaged in freight logistics services

Sino-Global Shipping HK Ltd. (“SGS HK”)	●	~~Incorporated on September 22, 2008~~A Hong Kong corporation	100% owned by the Company
	●	~~No material operations~~Incorporated on September 22, 2008
	●	~~A Hong Kong corporation~~ No material operations

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Name	Background		Ownership
Thor Miner Inc. (“Thor Miner”)	●	A Delaware corporation	51% owned by the Company
	●	Incorporated on October 13, 2021
	●	Primarily engaged in sales of crypto mining machines

Trans Pacific Shipping Ltd. (“Trans Pacific Beijing”)	●	A PRC limited liability company	100% owned by the Company
	●	Incorporated on November 13, 2007.
	●	Primarily engaged in freight logistics services

Trans Pacific Logistic Shanghai Ltd. (“Trans Pacific Shanghai”)	●	A PRC limited liability company	90% owned by Trans Pacific Beijing
	●	Incorporated on May 31, 2009
	●	Primarily engaged in freight logistics services

Ningbo Saimeinuo Web Technology Ltd. (“SGS Ningbo”)	●	A PRC limited liability company	100% owned by SGS NY
	●	Incorporated on September 11,2017
	●	Primarily engaged in freight logistics services

Blumargo IT Solution Ltd. (“Blumargo”)	●	A New York corporation	100% owned by SGS NY
	●	Incorporated on December 14, 2020
	●	No material operations

Gorgeous Trading Ltd (“Gorgeous Trading”)	●	A Texas corporation	100% owned by SGS NY
	●	Incorporated on July 01, 2021
	●	Primarily engaged in warehouse related services

Brilliant Warehouse Service Inc. (“Brilliant Warehouse”)	●	A Texas corporation	51% owned by SGS NY
	●	Incorporated on April 19,2021
	●	Primarily engaged in warehouse house related services

Phi Electric Motor In. (“Phi”)	●	A New York corporation	51% owned by SGS NY
	●	Incorporated on August 30, 2021
	●	No operations

SG Shipping & Risk Solution Inc, (“SGSR”)	●	A New York corporation	100% owned By the Company
	●	Incorporated on September 29, 2021
	●	No material operations

SG Link LLC (“SG Link”)	●	A New York corporation	100% owned by SG Shipping & Risk Solution Inc on January 25, 2022
	●	Incorporated on December 23, 2021
	●	No material operations
New Energy Tech Limited (“New Energy”)	●	A New York corporation	100% owned by the Company
	●	Incorporated on September 19, 2023
	●	No material operations

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

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-Global Shipping Agency Ltd. (“Sino-China”) was considered a Variable Interest Entity (“VIE”), with the Company as the primary beneficiary. 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. The Company, through Trans Pacific Beijing, entered into certain agreements with 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/loss from operations was 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. ~~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.

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.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

(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 dollars (“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 ~~March 31,~~September 30, 2023 and June 30, ~~2022~~2023 and for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2023 and 2022 are as follows:

	March 31, 2023		June 30, 2022		Three months ended March 31,				Nine months ended March 31,				September 30, 2023		June 30, 2023		Three months ended September 30,
Foreign currency	Balance Sheet		Balance Sheet		2023 Profit/Loss		2022 Profit/Loss		2023 Profit/Loss		2022 Profit/Loss		Balance Sheet		Balance Sheet		2023 Profit/Loss		2022 Profit/Loss
RMB:1USD		6.8689		6.6994		6.8423		6.3483		6.9321		6.4048		7.2755		7.2537		7.2350		6.8425
HKD:1USD		7.8500		7.8474		7.8386		7.8044		7.8369		7.7906		7.8312		7.8366		7.8251		7.8483

(e) Cash

Cash consists of cash on hand and cash in banks 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 ~~March 31,~~September 30, 2023 and June 30, ~~2022,~~2023, cash balances of ~~$96,790~~$250,316 and ~~$143,044,~~$183,510, respectively, were maintained at financial institutions in the PRC. $~~10,212~~153,787 and ~~nil~~74,533 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, ~~March 31,~~September 30, 2023 and June 30, ~~2022,~~2023, cash balances of ~~$21,503,288~~$205,888 and ~~$55,636,636,~~$919,990, respectively, were maintained at U.S. financial institutions. ~~$20,173,927 and $53,869,575 of these balances are not covered by insurance, as each~~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 ~~March 31,~~September 30, 2023 and June 30, ~~2022,~~2023, cash balances of ~~$7,605~~$9,595,097 and ~~$51,701,~~$16,285,067, respectively, were maintained at financial institutions in Hong Kong and ~~were insured~~$9,504,774 and $16,216,393 of these balances are not covered by ~~the Hong Kong Deposit Protection Board.~~insurance. As of ~~March 31,~~September 30, 2023 and June 30, ~~2022, cash balances of~~ ~~nil~~ ~~and $192, respectively, were maintained at Australia financial institutions, and were insured as~~2023, the ~~Australian government guarantees deposits up to AUD 250,000 (approximately $172,000). As of March 31, 2023 and June 30, 2022,~~ amount of Company’s deposits ~~the Company had~~ covered by insurance amounted to ~~$1,423,544~~$392,740 and ~~$1,961,997,~~$647,004, respectively.

(f) Cryptocurrencies

Cryptocurrencies, mainly bitcoin, are included in current assets in the accompanying consolidated balance sheets. Cryptocurrencies purchased are recorded at cost. Fair value of the cryptocurrency award received is determined using the quoted price of the related cryptocurrency at the time of receipt.

Cryptocurrencies 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.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

(g) Receivables and Allowance for Credit Losses

Accounts receivable are presented at net realizable value. The Company maintains allowances for ~~credit~~doubtful accounts and for estimated 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. As the Company has focused its development on the shipping management segment, its customer base consists of more smaller privately owned companies that we believe will pay more timely than state owned companies.

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~~bad debt allowance 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~~doubtful accounts 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 ~~and nine~~ months ended ~~March 31,~~September 30, 2023 and 2022, no impairments were recorded.

(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.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

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~~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~~ Ltd. in October 2021. ~~For the year ended~~As of June 30, ~~2022,~~2023, the Company invested $210,000 and recorded ~~$47,181~~$81,640 investment ~~loss.~~loss in LSM. The joint venture has not started its operations due to ~~COVID-19. Due to continuing loss~~COVID-19.As we could not obtain the financial information of the investee, we determined ~~the loss is other than temporary and provided~~to provide a full impairment of our equity investment. The Company recorded ~~nil~~ ~~and $34,458 investment loss and $128,370~~a $128,360 impairment loss for the ~~three and nine months~~year ended ~~March 31,~~June 30, 2023.

(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, the Company provides transportation services which include mainly shipping services. The Company derives transportation revenue from sales contracts with its customers with revenues being recognized upon performance of services. Sales price to the customer are fixed upon acceptance of the sales contract and there is no separate sales rebate, discount, or other incentive. The Company’s revenues are recognized at a point in time 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~~for an integrated service that includes two or more services, including but not limited to warehousing, collection, first-mile delivery, drop shipping, customs clearance packaging, etc.

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.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

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 nine months ended March 31, 2023, the Company engaged in resale of cryptocurrency mining equipment. For the three months ended March 31, 2023, the Company did not sell crypto-mining machines.~~

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. (the “Buyer”). Pursuant to the Purchase and Sale Agreement, Thor Miner agreed to sell and the Buyer agreed to purchase certain cryptocurrency mining equipment.

The Company’s performance obligation was 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 ASC 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 was 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 ~~nine~~three months ended ~~March 31,~~September 30, 2022 and 2023, the Company recognized the net sale of cryptocurrency mining equipment ~~based on net basis~~in $497,045 and nil, respectively, as the manufacturer of the products ~~was~~are responsible for shipping and custom clearing for the products. ~~For~~The gross revenue was $4,672,223 and nil for the ~~three months ended March 31,~~first quarter of fiscal 2022 and 2023, ~~the Company did not recognize any sale of cryptocurrency mining equipment.~~respectively.

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~~balances amounted to ~~$205,477~~$66,354 and ~~$6,955,577~~$66,531 as of ~~March 31,~~September 30, 2023 and June 30, ~~2022,~~2023, respectively.

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

	For the Three Months Ended				For the Nine Months Ended				For the Three Months Ended
	March 31, 2023		March 31, 2022		March 31, 2023		March 31, 2022		September 30, 2023		September 30, 2022

Sale of crypto mining machines	$	-	$	-	$	732,565	$	-	$	-	$	497,045
Freight logistics services		759,905		971,747		2,739,475		2,829,682		895,926		724,159
Total	$	759,905	$	971,747	$	3,472,040	$	2,829,682	$	895,926	$	1,221,204

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Disaggregated information of revenues by geographic locations are as follows:

	For the Three Months Ended				For the Nine Months Ended				For the Three Months Ended
	March 31,		March 31,		March 31,		March 31,		September 30,		September 30,
	2023		2022		2023		2022		2023		2022
PRC	$	535,037	$	648,964	$	1,695,858	$	2,242,296	$	700,656	$	248,210
U.S.		224,868		322,783		1,776,182		587,386		195,270		972,994
Total revenues	$	759,905	$	971,747	$	3,472,040	$	2,829,682	$	895,926	$	1,221,204

(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~~do 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 ~~March 31,~~September 30, 2023 and June 30, ~~2022.~~2023.

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

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

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 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 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 ~~and nine~~ months ended ~~March 31,~~September 30, 2023 and 2022, there was no dilutive effect of potential shares of common stock of the Company because the Company generated a 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.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

(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 the 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 and nine months ended March 31, 2023. 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) ~~Disposal of subsidiaries and VIE~~

On December 31, 2021, the Company entered into a series of agreements to terminate its VIE structure and deconsolidated its formerly controlled entity Sino-Global Shipping Agency Ltd. (“Sino-China”). The Company controlled Sino-China through its wholly owned subsidiary Trans Pacific Beijing. The Company made the decision to dissolve the VIE structure and Sino-China because Sino-China has no active operations and the Company wanted to remove any potential risks associated with any VIE structures. In addition, the Company dissolved its subsidiary Sino-Global Shipping LA, Inc. On March 14, 2022, the Company discontinued its subsidiary Sino-Global Shipping Canada, Inc., no gain or loss was recognized in the deconsolidation. In November 2022, the Company dissolved its subsidiary Sino-Global Shipping Australia Pty Ltd., no material gain or loss was recognized.

~~Since the disposal did not represent any strategic change of the Company’s operation, the disposal was not presented as a discontinued operation.~~

~~Net assets of the entities disposed and loss on disposal was as follows:~~

For the three and nine months ended
March 31, 2022
VIE Subsidiaries Total
Total current assets $ 83,573 $ 20,898 $ 104,471

Total other assets 8,723 - 8,723

Total assets 92,296 20,898 113,194

Total current liabilities 41,608 1,100 42,708
Total net assets 50,688 19,798 70,486
Noncontrolling interests 5,919,050 - 5,919,050
Exchange rate effect 142,080 - 142,080
Total loss on disposal $ 6,111,818 $ 19,798 $ 6,131,616

~~(s)~~ 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~~continually assesses any new accounting pronouncements to determine their applicability. When it ~~will become effective on July 1, 2023 assuming~~is determined that a new accounting pronouncement affects the Company’s financial reporting, the Company ~~will remain eligible~~undertakes a study to ~~be smaller reporting company. The adoption did not have material impact on~~determine the ~~Company’s unaudited~~consequences of the change to its 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~~assures that there are proper controls in place to ascertain that the Company’s ~~unaudited~~ condensed consolidated financial ~~statements.~~statements properly reflect the change.

On June 30, 2022, FASB issued ASU No. 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. ASU 2022-03 clarifies that a contractual sale restriction prohibiting the sale of an equity security is a characteristic of the reporting entity holding the equity security and is not included in the equity security’s unit of account. The new standard is effective for the Company for its fiscal year beginning January 1, 2024, with early adoption permitted.

On March 28, 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-01, Leases (Topic 842): Common Control Arrangements. The amendments in ASU 2023-01 improve current GAAP by clarifying the accounting for leasehold improvements associated with common control leases, thereby reducing diversity in practice. Additionally, the amendments provide investors and other allocators of capital with financial information that better reflects the economics of those transactions. The new standard is effective for the Company for its fiscal year beginning January 1, 2024, with early adoption permitted.

Note 3. CRYPTOCURRENCIES

The following table presents additional information about cryptocurrencies:

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Beginning balance	$	90,458		$	261,338		$	72,179		$	90,458
Receipt of cryptocurrencies from mining services		-			-			-			-
Impairment loss		(14,801	)		(170,880	)		(72,179	)		(18,279	)
Ending balance	$	75,657		$	90,458		$	-		$	72,179

The Company recorded ~~nil~~ ~~and~~ a ~~$14,801~~$72,179 impairment loss for the three ~~and nine~~ months ended ~~March 31, 2023, respectively. The Company recorded $3,052 and $53,179~~September 30, 2023. There was $18,279 impairment ~~losses~~loss for the ~~three and nine months~~year ended ~~March 31, 2022, respectively.~~June 30, 2023. As ownership rights of the cryptocurrencies could not be verified, full impairment was recognized.

Note 4. ACCOUNTS RECEIVABLE, NET

The Company’s net accounts receivable are as follows:

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Trade accounts receivable	$	3,591,664		$	3,521,491		$	3,498,518		$	3,487,293
Less: allowances for credit losses		(3,365,374	)		(3,413,110	)		(3,284,352	)		(3,288,740	)
Accounts receivable, net	$	226,290		$	108,381		$	214,166		$	198,553

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Movement of allowance for credit losses are as follows:

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Beginning balance	$	3,413,110		$	3,475,769		$	3,288,740		$	3,413,110
Provision for credit losses, net of recovery		(7,357	)		257			-			-
Write-off/recovery								-			-
Exchange rate effect		(40,379	)		(62,916	)		(4,388	)		(124,370	)
Ending balance	$	3,365,374		$	3,413,110		$	3,284,352		$	3,288,740

Note 5. OTHER RECEIVABLES, NET

The Company’s other receivables are as follows:

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Advances to customers*	$	4,186,368		$	3,943,547		$	7,049,697		$	7,060,456
Employee business advances		19,014			23,768			17,209			10,570
Total		4,205,382			3,967,315			7,066,906			7,071,026
Less: allowances for credit losses		(4,186,034	)		(3,942,258	)		(6,983,268	)		(6,994,212	)
Other receivables, net	$	19,348		$	25,057		$	83,638		$	76,814

~~In fiscal year 2019 and 2020,~~On March 23, 2023, SG Shipping & Risk Solution Inc. an indirect wholly owned subsidiary of SGLY entered into an operating income right transfer contract with Goalowen Inc. pursuant to which Goalowen agreed to transfer its rights to receive income from operating a tuna fishing vessel to SG Shipping for $3 million. Such contract was signed by the Company’s former COO Jing Shan without the Board’s authorization. On May 5, 2023, Ms. Shan made a wire transfer of $3 million to Goalowen without the Board’s authorization,. It was recorded as an Advance to customers. As of June 30, 2023, the Company ~~entered into contracts with several customers where~~evaluated the ~~Company’s services included both freight charge~~collection possibility, and ~~cost~~decided to provide a 100% allowance provision in the amount of commodities to be shipped to customers’ designated locations. The terms of the contracts required the Company to prepay the commodities. The Company prepaid for the commodities and reclassified the payment as other receivables as the payments were paid on behalf of the customers. These payments will be repaid to the Company when either the contract is executed or the contracts are terminated by either party. The customers were negatively impacted by the pandemic and required additional time to execute the contracts, due to significant uncertainty on whether the delayed contracts will be executed timely, the Company had provided full allowance due to contract delay during the fiscal year ended June 30, 2020. The Company subsequently recovered $1,934,619 in fiscal year 2022.$3 million.

Movement of allowance for doubtful accounts are as follows:

	March 31,		June 30,			September 30,			June 30,
	2023		2022			2023			2023
Beginning balance	$	3,942,258	$	6,024,266		$	6,994,212		$	3,942,258
Increase							-			3,000,000
Recovery of doubtful accounts		-		(1,934,619	)		-			-
Less: write-off							-			-
Exchange rate effect		243,776		(147,389	)		(10,944	)		51,954
Ending balance	$	4,186,034	$	3,942,258		$	6,983,268		$	6,994,212

Note 6. ADVANCES TO SUPPLIERS

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

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Freight fees (1)	$	402,403		$	336,540		$	359,416		$	428,032
Less: allowances for credit losses		(300,000	)		(300,000	)		(300,000	)		(300,000	)
Advances to suppliers-third parties, net	$	102,403		$	36,540		$	59,416		$	128,032

(1)

The advanced freight fee is the Company’s prepayment made for various shipping costs for shipments from January 1, 2023 to ~~March 31,~~September 30, 2023. ~~As of March 31, 2023 and June 30, 2022, the~~The Company provided an allowance of ~~$300,000.~~$300,000 for the year ended June 30, 2022, and there was no change in the fiscal year 2023 and for the three months ended September 30, 2023.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Note 7. PREPAID EXPENSES AND OTHER CURRENT ASSETS

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

	March 31,		June 30,		September 30,		June 30,
	2023		2022		2023		2023
Prepaid income taxes	$	11,929	$	11,929	$	11,929	$	11,929
Other (including prepaid professional fees, rent, listing fees)		443,096		353,984
Other (including prepaid professional fees, rent)						238,788		240,118
Total	$	455,025	$	365,913	$	250,717	$	252,047

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

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

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Rental and utilities deposits	$	247,420		$	246,581		$	246,290		$	244,923
Less: allowances for deposits		(8,614	)		(8,832	)		(58,133	)		(8,157	)
Other long-term assets- deposits, net	$	238,806		$	237,749		$	188,157		$	236,766

Movements of allowance for deposits are as follows:

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Beginning balance	$	8,832		$	3,177,127		$	8,157		$	8,832
Allowance for deposits								50,000			-
Less: Write-off		-			(3,173,408	)		-			-
Exchange rate effect		(218	)		5,113			(24	)		(675	)
Ending balance	$	8,614		$	8,832		$	58,133		$	8,157

Note 9. PROPERTY AND EQUIPMENT, NET

The Company’s net property and equipment as follows:

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Motor vehicles	$	585,961		$	715,571		$	542,904		$	542,904
Computer equipment		121,016			117,397			87,545			113,097
Office equipment		69,356			67,139			67,610			67,699
Furniture and fixtures		536,227			390,093			533,547			533,634
System software		108,809			111,562			102,728			103,038
Leasehold improvements		809,218			829,687			763,991			766,294
Mining equipment		922,438			922,438			922,438			922,438

Total		3,153,025			3,153,887			3,020,763			3,049,104

Less: Impairment reserve		(1,200,994	)		(1,236,282	)		(1,223,981	)		(1,233,521	)
Less: Accumulated depreciation and amortization		(1,456,702	)		(1,368,649	)		(1,408,584	)		(1,389,240	)
Property and equipment, net	$	495,329		$	548,956		$	388,198		$	426,343

Depreciation and amortization expenses for the three months ended ~~March 31,~~September 30, 2023 and 2022 were ~~$42,569~~$38,127 and ~~$150,118, respectively. Depreciation and amortization expenses for the nine months ended March 31, 2023 and 2022 were $122,699 and $428,635,~~$78,945, respectively. No impairment loss was recorded for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2023 and 2022. ~~For the three and nine months of March 31, 2023, the Company disposed of vehicles having a net cost of $83,519, resulting in a gain on disposal of fixed assets of $6,481.~~

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Note 10. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

	March 31,		June 30,		September 30,		June 30,
	2023		2022		2023		2023
Salary and reimbursement payable	$	186,066	$	305,423	$	106,145	$	117,648
Professional fees and other expense payable		125,544		305,264		97,563		97,563
Interest payable		321,310		136,379		4,872		386,378
Others		21,451		9,206		8,151		35,105
Total	$	654,371	$	756,272	$	216,731	$	636,694

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 carried interest of 5% annually and ~~could be converted~~were convertible 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 investors were able to convert their Convertible Notes ~~are~~into shares of the Company’s common stock beginning on June 19, 2022. The Convertible Notes were unsecured senior obligations of the Company, and the maturity date of the Convertible Notes iswas December 18, 2023. The Company ~~may~~could 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 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 ~~Convertible Note~~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 ~~such notes~~the Convertible Notes to an aggregate principal amount of $5,000,000.

~~The~~ There other terms of the ~~Amended and Restated Convertible Notes are the same as that of the original Convertible Notes,~~notes remained unchanged 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 ~~and nine~~ months ended ~~March 31,~~September 30, 2023 ~~interest expenses related to the aforementioned notes amounted to $61,345~~ and ~~$184,932, respectively. For the three and nine months ended March 31,~~ 2022, interest expenses related to the aforementioned notes amounted to ~~$60,959~~$21,917 and ~~$69,178,~~$61,643, respectively.

On August 8, 2023, upon the unanimous consent of the board of directors of the Company, the Company prepaid the total outstanding $5,000,000 balance of the 2022 Notes, along with the accrued interest of $403,424. The Company was not subject to any prepayment penalties.

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.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

The Company has several lease agreements with lease terms ranging from two to five years. As of ~~March 31,~~September 30, 2023, ROU assets and lease liabilities amounted to ~~$473,513~~$285,089 and ~~$698,143~~$447,751 (including ~~$341,922~~$260,134 from lease liabilities current portion and ~~$356,221~~$187,617 from lease liabilities non-current portion), respectively and weighted average discount rate was approximately ~~10.63%~~10.74%.

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 ~~2.40~~2.32 years.

For the three months ended ~~March 31,~~September 30, 2023 and 2022, rent expense amounted to approximately ~~$264,000~~$160,489 and ~~$102,000, respectively. For the nine months ended March 31, 2023 and 2022, rent expense amounted to approximately $411,000 and $358,000,~~$146,461, respectively.

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

Twelve Months Ending March 31,	Operating Lease Amount
Twelve Months Ending September 30,				Operating Lease Amount

2024	$	405,395		$	299,718
2025		238,752			112,015
2026		113,687			95,668
2027		38,267
Total lease payments		796,101			507,401
Less: Interest		(97,958	)		59,650
Present value of lease liabilities	$	698,143		$	447,751

Note 13. EQUITY

After the close of the stock market on July 7, 2020, the Company effected a l-for-5 reverse stock split of its common stock in order to satisfy continued listing requirements of its common stock on the NASDAQ Capital Market. The reverse stock split was approved by the Company’s board of directors and stockholders and was intended to allow the Company to meet the minimum share price requirement of $1.00 per share for continued listing on the NASDAQ Capital Market. As a result, all common stock share amounts included in this filing have been retroactively reduced by a factor of five, and all common stock per share amounts have been increased by a factor of five. Amounts affected include common stock outstanding, including those that have resulted from the stock options, and warrants exercisable for common stock.

Stock issuances:

On September 17, 2020, the Company entered into certain securities purchase agreement with certain “non-U.S. Persons” as defined in Regulation S of the Securities Act of 1933, as amended, pursuant to which the Company sold an aggregate of 720,000 shares of the Company’s common stock, no par value, and warrants to purchase 720,000 shares at a per share purchase price of $1.46. The net proceeds to the Company from such offering were approximately $1.05 million. The warrants became exercisable on March 16, 2021 at an exercise price of $1.825 per share. The warrants may also be exercised on a cashless basis if at any time after March 16, 2021, there is no effective registration statement registering, or no current prospectus available for, the resale of the warrant shares. The warrants will expire on March 16, 2026. The warrants are subject to anti-dilution provisions to reflect stock dividends and splits or other similar transactions. The warrants contain a mandatory exercise right for the Company to force exercise of the warrants if the Company’s common stock trades at or above $4.38 for 20 consecutive trading days, provided, among other things, that the shares issuable upon exercise of the warrants are registered or may be sold pursuant to Rule 144 and the daily trading volume exceeds 60,000 shares of common stock per trading day on each trading day in a period of 20 consecutive trading days prior to the applicable date.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

On November 2 and November 3, 2020, the Company issued an aggregate of 860,000 shares of Series A Convertible Preferred Stock (the “Series A Preferred Stock”), each convertible into one share of common stock, no par value, of Company, upon the terms and subject to the limitations and considerations set forth in the Certificate of Designation of the Series A Preferred Stock, and warrants to purchase up to 1,032,000 shares of common stock. The purchase price for each share of Series A Preferred Stock and accompanying warrants is $1.66. The net proceeds to the Company from this offering was approximately $1.43 million, not including any proceeds that may be received upon cash exercise of the warrants. The warrants became exercisable six (6) months following the date of issuance at an exercise price of $1.99 per share. The warrants may also be exercised on a cashless basis if at any time after the six-month anniversary of the issuance date, there is no effective registration statement registering, or no current prospectus available for, the resale of the warrant Shares. The warrants will expire five and a half (5.5) years from the date of issuance. The warrants are subject to anti-dilution provisions to reflect stock dividends and splits or other similar transactions. The warrants contain a mandatory exercise right for the Company to force exercise of the warrants if the closing price of the common stock equals or exceeds $5.97 for twenty (20) consecutive trading days, provided, among other things, that the shares issuable upon exercise of the warrants are registered or may be sold pursuant to Rule 144 and the daily trading volume exceeds 60,000 shares of common stock per trading day on each trading day in a period of 20 consecutive trading days prior to the applicable date. In February 2021, the shareholders approved the preferred shareholders’ right to convert 860,000 shares of Series A Preferred Stock into 860,000 shares of common stock in the Company’s annual meeting of shareholders. As of June 30, 2022, the Series A Preferred Stock have been fully converted to common stock on a one-for-one basis.

On December 8, 2020, the Company entered into a securities purchase agreement with certain investors thereto pursuant to which the Company sold to the investors, and the investors purchased from the Company, in a registered direct offering, an aggregate of 1,560,000 shares of the common stock of the Company, no par value per share, at a purchase price of $3.10 per share, and warrants to purchase up to an aggregate of 1,170,000 shares of common stock of the Company at an exercise price of $3.10 per share, for aggregate gross proceeds to the Company of $4,836,000. The warrants are initially exercisable beginning on December 11, 2020 and will expire three and a half (3.5) years from the date of issuance. The exercise price and the number of shares of common stock issuable upon exercise of the warrants are subject to adjustment in the event of stock splits or dividends, or other similar transactions, but not as a result of future securities offerings at lower prices.

On January 27, 2021, the Company entered into a securities purchase agreement with certain non-U.S. investors thereto pursuant to which the Company sold to the investors, and the investors purchased from the Company, an aggregate of 1,086,956 shares of common stock, no par value, and warrants to purchase 5,434,780 shares. The net proceeds to the Company from this offering were approximately $4.0 million. The purchase price for each share of common stock and five warrants is $3.68, and the exercise price per warrant is $5.00. The warrants became exercisable at any time during the period beginning on or after July 27, 2021 and ending on or prior on January 27, 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 $0.3 billion for a three consecutive month period prior to an exercise.

On February 6, 2021, the Company entered into a securities purchase agreement with certain investors pursuant to which the Company sold to the investors, and the investors purchased from the Company, in a registered direct offering, an aggregate of 1,998,500 shares of the common stock of the Company, no par value per share, at a purchase price of $6.805 per share. Net proceeds to the Company from the sale of the shares and the warrants, after deducting estimated offering expenses and placement agent fees, were approximately $12.4 million. The Company also sold to the investors warrants to purchase up to an aggregate of 1,998,500 shares of common stock at an exercise price of $6.805 per share. The warrants are exercisable upon issuance and expire five and a half (5.5) years from the date of issuance. The exercise price and the number of shares of common stock issuable upon exercise of the warrants are subject to adjustment in the event of stock splits or dividends, or other similar transactions, but not as a result of future securities offerings at lower prices.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

On February 9, 2021, the Company entered into a securities purchase agreement with certain investors pursuant to which the Company sold to the investors, and the investors purchased from the Company, in a registered direct offering, an aggregate of 3,655,000 shares of the common stock of the Company, no par value per share, at a purchase price of $7.80 per share. Net proceeds to the Company from the sale of the shares and the warrants, after deducting estimated offering expenses and placement agent fees, were approximately $26.1 million. The Company also sold to the investors warrants to purchase up to an aggregate of 3,655,000 shares of common stock at an exercise price of $7.80 per share. The warrants are exercisable upon issuance and expire five and a half (5.5) years from the date of issuance. The exercise price and the number of shares of common stock issuable upon exercise of the warrants are subject to adjustment in the event of stock splits or dividends, or other similar transactions, but not as a result of future securities offerings at lower prices.

On December 14, 2021, the Company entered into a ~~securities purchase agreement~~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 was $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 ~~of common stock~~ and 4,843,210 warrants. In connection with the issuance, the Company issued 500,000 shares to a consultant ~~that assisted~~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; ~~subject to~~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~~ 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 iswas $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. The Warrants were deemed cancelled upon the receipt by the Sellers of the purchase price.~~

On January 9, 2023, the Company entered into an Executive Separation Agreement and General Release (the “Separation Agreement”), with Lei Cao, an employee and a member of the Board of Directors of the Company (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 to the Board on January 9, 2023. In addition, he agreed to forfeit and return to the Company the 600,000 shares of Common Stock 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 December 19, 2022, and December 27, 2022, the Company entered into a cancellation agreement and a letter confirming the rescission of the grant of the shares to Yang Jie and Jing Shan, respectively, pursuant to which Yang Jie and Jing Shan returned 300,000 shares and 100,000 shares of Common Stock, respectively, to the Company at no cost. Such shares were previously issued to each of them for his/her services as an officer of the Company. The cancellation of such shares has been completed.

Following is a summary of the status of warrants outstanding and exercisable as of ~~March 31, 2023:~~ September 30, 2023

Warrants Weighted
Average
Exercise
Price

Warrants outstanding, as of June 30, 2022 12,191,824 $ 4.37
Issued - -
Exercised - -
Repurchased - -
Warrants outstanding, as of March, 31, 2023 12,191,824 $ 4.37
Warrants exercisable, as of March, 31, 2023 12,191,824 $ 4.37

	Warrants			Weighted Average Exercise Price

Warrants outstanding, as of June 30, 2023		12,191,824		$	4.37
Issued		-			-
Exercised		-			-
Expired		(103,334	)		8.75
Warrants outstanding, as of September 30, 2023		12,088,490		$	4.33
Warrants exercisable, as of September 30, 2023		12,088,490		$	4.33

Warrants Outstanding Warrants
Exercisable Weighted
Average
Exercise
Price Average
Remaining
Contractual
Life
2018 Series A, 400,000 103,334 $ 8.75 0.45 years
2020 warrants, 2,922,000 181,000 $ 1.83 2.42 years
2021 warrants, 11,088,280 11,907,490 $ 4.94 3.31 years

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Warrants Outstanding	Warrants Exercisable		Weighted Average Exercise Price		Average Remaining Contractual Life
2018 Series A, 400,000		103,334	$	8.75	0 years
2020 warrants, 2,922,000		181,000	$	1.83	1.92 years
2021 warrants, 11,088,280		11,907,490	$	4.94	2.81 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 (the “Committee”) 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~~positions as a member of the Board, the Chairperson of the Compensation 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 ~~amounted~~amounts to $2,740,000 based on the grant date share price of $5.48. On December 27, 2022 and December 19, 2022, Jing Shan and Yang Jie each signed a 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 March 31, 2023, the 300,000 shares issued to Mr. Jie and the 100,000 shares issued to Ms. Shan were cancelled.

On February 16, 2022, the Company’s Board approved a consulting agreement pursuant to which the Company ~~will issue~~agreed to pay the consultant a monthly fee of $10,000 and 100,000 shares of the Company’s common ~~stock and pay a monthly fee of $10,000.~~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 nil and ~~$329,777~~$247,333 for the three month ended September 30, 2023 and ~~nine~~2022, respectively.

During the three months ended ~~March 31, 2023.~~September 30, 2023 and 2022, nil and $247,333 were recorded as stock-based compensation expense, respectively.

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 of Directors of the Company (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 to 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. The 600,000 shares were cancelled as of March 31, 2023.SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

~~During the three months ended March 31, 2023 and 2022,~~ ~~nil~~ and $6,512,889 were recorded as stock-based compensation expense, respectively. During the nine months ended March 31, 2023 and 2022, $329,777 and $9,817,289 were recorded as stock-based compensation expense, respectively.

~~Stock Options:~~

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

Options Weighted
Average
Exercise
Price

Options outstanding, as of June 30, 2022 2,000 $ 10.05
Granted - -
Exercised - -
Cancelled, forfeited or expired (2,000 ) 10.05
Options outstanding, as of March 31, 2023 - $ -
Options exercisable, as of March 31, 2023 - $ -

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Note 14. NON-CONTROLLING INTEREST

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

	March 31,			June 30,			September 30,			June 30,
	2023			2022			2023			2023
Trans Pacific Shanghai	$	(1,595,689	)	$	(1,521,645	)	$	(1,505,298	)	$	(1,522,971	)
Thor Miner		(729,890	)		(486,942	)		(917,761	)		(814,005	)
Brilliant Warehouse		139,621			(132,303	)		104,244			117,035
Total	$	(2,185,958	)	$	(2,140,890	)	$	(2,318,815	)	$	(2,219,941	)

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 lawsuit in the New York State Supreme Court on December 9, 2022 against the Company’s joint venture, Thor Miner, Inc.~~, which is Singularity’s joint venture~~ (“Thor Miner”), 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 on January 10, 2022 (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)~~$13,000,000 to SOSNY (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 the Company (and other Defendants) upon receipt of the Settlement Payment on December 28, 2022.

The Company 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)~~$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~~will be deducted from the ~~total amount of forty million, five hundred sixty thousand, five hundred sixty-nine dollars ($40,560,569.00)~~$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.

Lawsuits in connection with ~~the Securities Purchase Agreement~~2021 securities purchase agreement

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.

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Lawsuit in connection with the Financial Advisory Agreement

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, the St. Hudson lawsuit was consolidated with this lawsuit and the Hexin lawsuit and 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. The Company, Yang Jie, Jing Shan, and the plaintiffs of the above three actions entered into a certain settlement agreement and general mutual release with an effective date of March 10, 2023, pursuant to which the Company agreed to pay the ~~sum of~~plaitiffs $10,525,910.82. Plaintiffs in the actions agreed to discharge and forever release the defendants in the actions from all claims that were or could have been raised in those actions, as well as dismissal of each of the actions with prejudice. The Company ~~has no role or knowledge as to how the settlement payment will be allocated between and among the plaintiffs. The Company~~ paid the settlement payment on March 14, 2023.

In addition, the plaintiffs agreed to irrevocably forfeit 3,728,807 shares of ~~Common Stock they hold.~~common stock held by them. The cancellation of ~~2,400,000~~the shares has been completed, while the cancellation of the remaining 1,328,807 shares is still in processing. The fair value of the shares was $2,125,420 at March 10, 2023, the settlement amount over the fair value of the shares to be cancelled is recorded as other expenses in the Company’s consolidated statement of operations.completed.

Putative Class Action

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~~The Company is also subject to additional contractual ~~litigations~~litigation as to which it is unable to estimate the outcome.

Government Investigations

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.~~SEC. 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~~The Company’s income tax expenses for three months ended September 30, 2023 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.2022 are as follows:

	For the three months Ended September 30
	2023		2022
Current
U.S.	$	-	$	(103,426	)
PRC		-		-
Total income tax expenses		-		(103,426	)

~~The Company’s income tax expenses for three and nine months ended March 31, 2023 and 2022 are as follows:~~SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the three months Ended
March 31 For the nine months Ended
March 31
2023 2022 2023 2022
Current
U.S. $ - $ - $ 103,426 $ -
PRC - - - -
Total income tax expenses - - 103,426 -

For the Three Months ended September 30, 2023

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

	March 31, 2023			June 30, 2022			September 30, 2023			June 30, 2023
Allowance for doubtful accounts
U.S.	$	608,000		$	617,000		$	1,251,000		$	1,241,000
PRC		1,783,000			1,830,000			1,650,000			1,655,000

Net operating loss
U.S.		8,943,000			4,628,000			9,223,000			8,775,000
PRC		1,409,000			1,283,000			1,451,000			1,425,000
Total deferred tax assets		12,743,000			8,358,000			13,575,000			13,096,000
Valuation allowance		(12,743,000	)		(8,358,000	)		(13,575,000	)		(13,096,000	)
Deferred tax assets, net - long-term	$	-		$	-		$	-		$	-

The Company’s operations in the U.S. incurred cumulative U.S. federal net operation losses (“NOL”) of approximately ~~$22,000,000~~$41.7 million as of June 30, ~~2022,~~2023, which may reduce future federal taxable income. During the three ~~and nine~~ months ended ~~March 31,~~September 30, 2023, approximately ~~$13,300,000 and $20,500,000~~$2.1 million of NOL was generated and the tax benefit derived from such NOL was approximately ~~$2,793,000 and $4,300,000.~~$9.2 million. As of ~~March 31,~~September 30, 2023, the Company’s cumulative NOL amounted to approximately ~~$42,600,000,~~$43.8 million, which may reduce future federal taxable ~~income, of which approximately $1,400,000 will expire in 2037 and the remaining balance carried forward indefinitely.~~income.

The Company’s operations in China incurred a cumulative NOL of approximately ~~$1,333,000~~$1.7 million as of June 30, ~~2022~~2023 which was mainly from net loss. During the three ~~and nine~~ months ended ~~March 31,~~September 30, 2023, additional NOL of approximately ~~nil~~ ~~and $303,000~~$0.1 million was generated. As of ~~March 31,~~September 30, 2023, the Company’s cumulative NOL amounted to approximately ~~$5,634,000~~$1.8 million 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 ~~March 31,~~September 30, 2023. The net increase in valuation for the three months ~~and nine months~~ ended ~~March 31,~~September 30, 2023 amounted to approximately ~~$2,921,000 and $4,385,000,~~$479,000, 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,		June 30,
	2023		2023
VAT tax payable	$	1,011,758	$	1,016,529
Corporate income tax payable		2,255,047		2,261,131
Others		56,399		57,298
Total	$	3,323,204	$	3,334,958

~~The Company’s taxes payable consists of the following:~~SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

March 31, June 30,
2023 2022
VAT tax payable $ 1,138,951 $ 1,098,862
Corporate income tax payable 2,338,908 2,295,803
Others 58,069 62,512
Total $ 3,535,928 $ 3,457,177

For the Three Months ended September 30, 2023

Note 17. CONCENTRATIONS

Major Customers

For the three months ended ~~March 31,~~September 30, 2023, one customer accounted for ~~approximately 70.5% of the Company’s gross revenues, respectively.~~

~~For the three months ended March 31, 2022, two customers accounted for approximately 66.5% and 33.2% of the Company’s revenues.~~

~~For the nine months ended March 31, 2023, two customers accounted for 17.3% and 71.5%~~78.3% of the Company’s gross revenues. As of ~~March 31,~~September 30, 2023, three customers accounted for ~~10.8%~~34.5%, ~~15.6%~~21.2% and ~~40.4%~~10.8% of the Company’s accounts receivable, net.

For the ~~nine~~three months ended ~~March 31,~~September 30, 2022, ~~three~~one customer accounted for 86.5% of the Company’s gross revenues. As of September 30, 2022, two customers accounted for ~~approximately 59.4%, 20.8%~~45.0% and ~~11.9% of the Company’s revenues, respectively. As of March 31, 2022, three customers accounted for approximately 41.2%, 18.3% and 12.9%~~12.5% of the Company’s accounts receivable, net.

Major Suppliers

For the three months ended ~~March 31,~~September 30, 2023, ~~three~~two suppliers accounted for approximately ~~55.1%, 21.1%~~22.1% and ~~18.7%~~15.2% of the total gross purchases.

For the three months ended ~~March 31,~~September 30, 2022, ~~three suppliers accounted for approximately 41.8%, 27.2% and 11.7% of the total costs of revenue.~~

~~For the nine months ended March 31, 2023,~~ one supplier accounted for approximately ~~67.6%~~84.8% of the gross purchases.

~~For the nine months ended March 31, 2022, three suppliers accounted for approximately 37.9%, 18.9% and 14.7% of the total cost of revenues.~~

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. For the nine months ended March 31, 2023, the Company operated in two segments: (1) freight logistics services, 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 Company ceased to sell crypto-mining equipment since January 1, 2023. For the three months ended ~~March 31,~~September 30, 2023, the Company operated in freight logistics services, which were operated by its subsidiaries in both the United States and PRC. For the three months ended September 30, 2023, the Company did not sell crypto-mining machines. On March 30, 2023, the board of directors of the Company authorized the Company to conduct an e-commerce business in China, including but not limited to the marketing approach of media redirecting.

The following tables present summary information by segment for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2023 and 2022, respectively:

	For the Three Months Ended March 31, 2023						For the Three Months Ended September 30, 2023
	Freight Logistics Services			Total			Freight Logistics Services			Crypto-mining equipment sales			Total
Net revenues	$	759,905		$	759,905		$	895,926		$	-		$	895,926
Cost of revenues	$	888,040		$	888,040		$	1,002,949		$	-		$	1,002,949
Gross profit	$	(128,135	)	$	(128,135	)	$	(107,023	)	$	-		$	(107,023	)
Depreciation and amortization	$	42,569		$	42,569		$	37,770		$	357		$	38,127
Total capital expenditures	$	3,534		$	3,534		$	-		$	-		$	-
Gross margin%		(16.9	)%		(16.9	)%		(11.9	)%		100.0	%		(11.9	)%

For the Three Months Ended
March 31, 2022
Freight
Logistics
Services Total
Net revenues $ 971,747 $ 971,747
Cost of revenues $ 901,275 $ 901,275
Gross profit $ 70,472 $ 70,472
Depreciation and amortization $ 150,118 $ 150,118
Total capital expenditures $ 151,021 $ 151,021
Gross margin% 7.3 % 7.3 %

For Nine Months Ended
March 31, 2023
Freight
Logistics
Services Crypto-mining
equipment
sales Total
Net revenues $ 2,739,475 $ 732,565 $ 3,472,040
Cost of revenues $ 2,944,804 $ - $ 2,944,804
Gross profit $ (205,329 ) $ 732,565 $ 527,236
Depreciation and amortization $ 101,970 $ 20,729 $ 122,699
Total capital expenditures $ 154,500 $ - $ 154,500
Gross margin% (7.5 )% 100.0 % 15.2 %

	For the Nine Months Ended March 31, 2022									For the Three Months Ended September 30, 2022
	Freight Logistics Services			Crypto-mining equipment sales			Total			Freight Logistics Services			Crypto-mining equipment sales			Total
Net revenues	$	2,829,682		$	-		$	2,829,682		$	724,159		$	497,045		$	1,221,204
Cost of revenues	$	2,973,034		$	-		$	2,973,034		$	745,627		$	-		$	745,627
Gross profit	$	(143,352	)	$	-		$	(143,352	)	$	(21,468	)	$	497,045		$	475,577
Depreciation and amortization	$	428,635		$	-		$	428,635		$	78,945		$	-		$	78,945
Total capital expenditures	$	775,107		$	-		$	775,107		$	150,966		$	-		$	150,966
Gross margin%		(5.1	)%		-	%		(5.1	)%		(3.0	)%		100.0	%		38.9	%

SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

For the Three Months ended September 30, 2023

Total assets as of:

	March 31,		June 30,		September 30,		June 30,
	2023		2022		2023		2023
Freight Logistic Services	$	21,406,702	$	44,058,444	$	11,548,365	$	19,075,202
Sale of crypto mining machines		2,581,565		20,789,296		1,783		162,605
Total Assets	$	23,988,267	$	64,847,740	$	11,550,148	$	19,237,807

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 Nine Months Ended				For the Three Months Ended
	March 31,		March 31,		March 31,		March 31,		September 30,		September 30,
	2023		2022		2023		2022		2023		2022
PRC	$	535,037	$	648,964	$	1,695,858	$	2,242,296	$	700,656	$	248,210
U.S.		224,868		322,783		1,776,182		587,386		195,270		972,994
Total revenues	$	759,905	$	971,747	$	3,472,040	$	2,829,682	$	895,926	$	1,221,204

Note 19. RELATED PARTY BALANCE AND TRANSACTIONS

~~Advance to suppliers-related~~Due from related party, net

~~The Company’s advances to suppliers –~~As of September 30, 2023 and June 30, 2023, the outstanding amounts due from related ~~party are as follows:~~parties consist of the following:

March 31, June 30,
2023 2022
Bitcoin mining hardware and other equipment (1) $ - $ 6,153,546
Total advances to suppliers-related party $ - $ 6,153,546

	September 30,			June 30,
	2023			2023
Zhejiang Jinbang Fuel Energy Co., Ltd (1)	$	408,634		$	458,607
Shanghai Baoyin Industrial Co., Ltd (2)		1,064,805			1,068,014
LSM Trading Ltd (3)		570,000			570,000
Rich Trading Co. Ltd (4)		103,424			103,424
Lei Cao (5)		11,752			13,166
Less: allowance for doubtful accounts		(2,132,500	)		(2,138,276	)
Total	$	26,115		$	74,935

(1)

~~On January 10, 2022,~~As of September 30, 2023 and June 30, 2023, the ~~Company’s joint venture, Thor Miner, entered into a Purchase~~Company advanced $408,634 and ~~Sales Agreement~~$458,607 to Zhejiang Jinbang Fuel Energy Co., Ltd (“~~PSA”~~Zhejiang Jinbang”) ~~with HighSharp. Pursuant to the Purchase Agreement, Thor Miner agreed to purchase certain cryptocurrency mining equipment. In January~~which is 30% owned by Mr. Wang Qinggang, CEO and ~~April 2022, Thor Miner made total prepayment~~legal representative of ~~$35,406,649 for the order~~Trans Pacific Shanghai. The advance is non-interest bearing and ~~no prepayment as of March 31, 2023.~~

due on demand. The Company ~~shipped $1,325,520~~provided allowance of ~~products of~~$382,519 and $383,672 for ~~the year ended June 2022 and $6,153,546 from July 2022 to March 31, 2023.~~

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 and was sued by SOSNY for breach of contract on December 9, 2022.

The Company entered into a settlement agreement with 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 advances to HighSharp and deposits 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~~receivable as of September 30, 2023 and June 30, 2023, and the ~~balance~~allowance changes as a result of ~~its payment to HighSharp resulted~~changes in ~~net bad debt expenses of $367,014.~~exchange rates.

~~Due from related party, net~~SINGULARITY FUTURE TECHNOLOGY LTD. AND SUBSIDIAIRES

Notes to the Condensed Consolidated Financial Statements

~~As of March 31,~~For the Three Months ended September 30, 2023 ~~and June 30, 2022, the outstanding amounts due from related parties consist of the following:~~

March 31, June 30,
2023 2022
Zhejiang Jinbang Fuel Energy Co., Ltd (1) $ 659,507 $ 415,412
Shanghai Baoyin Industrial Co., Ltd (2) 1,311,637 1,306,004
LSM Trading Ltd (3) 570,000 570,000
Rich Trading Co. Ltd (4) 103,424 103,424
Lei Cao (5) 13,902 54,860
Less: allowance for doubtful accounts (2,366,275 ) (2,449,700 )
Total $ 292,195 $ -

~~(1)~~

As of March 31, 2023 and June 30, 2022, the Company advanced approximately $0.7 million to Zhejiang Jinbang Fuel Energy Co., Ltd (“Zhejiang Jinbang”) which is owned by Mr. Qinggang Wang, CEO and legal representative of Trans Pacific Logistic Shanghai Ltd. The advance is non-interest bearing and due on demand. There has been no change in the balance other than changes as a result of changes in exchange rates. In December 2022, the Company further advanced approximately $0.4 million to Zhejiang Jinbang. During three months ended March 31, 2023, the Company further advanced approximately $0.4 million to Zhejiang Jinbang and Zhejiang Jinbang repaid approximately $0.5 million.

(2)

As of ~~March 31,~~September 30, 2023 and June 30, 2023, the Company advanced approximately $1.1 million and $1.3 million to Shanghai Baoyin Industrial Co., Ltd. which is 30% owned by Qinggang Wang, 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. ~~During three months ended March 31, 2023, the Company further advance approximately $38,000 to Shanghai Baoyin.~~

(3)	As of ~~March 31,~~September 30, 2023 and June 30, 2023, the Company advanced $570,000 to LSM Trading Ltd, which is 40% owned by the Company. 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, of which $3,200,000 has been returned to the Company. The Company provided allowance of $103,424 for the ~~year ended~~balance of the receivable as of September 30, 2023 and June 30, ~~2022.~~

2023.

(5)

The amount represents business advance to Mr. Lei Cao, the former Chairman of the Board. During the three months ended ~~March 31, 2023,~~September 30, 2023. Mr. Lei Cao ~~repaid approximately $54,000,~~paid back in $10,000, the receivables balance due from Lei Cao decreased accordingly. The impairment of ~~which approximately $13,000 additional payment~~$10,000 recognized in the prior year was ~~recognized as nonoperating income. The Company provided full credit losses for the remaining balance of the receivable.~~reversed in this reporting period.

~~Loan receivable- related parties~~

~~As of March 31, 2023 and June 30, 2022, the outstanding loan receivable from related parties consists of the following:~~

March 31, June 30,
2023 2022
Qinggang Wang (1) $ - $ 552,285

~~(1)~~

On June 10, 2021, the Company entered into a loan agreement with Qinggang Wang, CEO and legal representative of Trans Pacific Logistic Shanghai Ltd. The loan is non-interest bearing for loan amounts up to $630,805 (RMB 4 million). In February 2022, Qinggang Wang, borrowed and repaid $232,340 of the loan amount. In June 2022, additional $552,285 (RMB 3,700,000) was loaned to Qinggang Wang with due date of June 7, 2024. $70,265 (RMB 0.5 million) was returned in September 2022 and approximately $0.4 million (RMB 3.2 million) was returned in December 2022.

Accounts payable- related parties

As of ~~March 31, 2023 and~~ June 30, ~~2022,~~2023, the Company had accounts payable to Rich Trading Co. Ltd of $63,434. And there was no change as of September 30, 2023.

~~Other payable- related parties~~Due to Related Party

As of ~~March 31,~~September 30, 2023 and June 30, 2023, the Company had accounts payable to Qinggang Wang, CEO and legal representative of Trans Pacific Shanghai, of ~~$110,842.~~$104,647 and $104,962. These payments were made on behalf of the Company for the daily business operational activities.

Note 20. SUBSEQUENT EVENTS

On ~~April 18,~~October 6, 2023, the Company entered into an employment agreement with Mr. Ziyuan Liu and appointed him as the chief executive officer (the “CEO”) of the Company, effective immediately, with a term of one year. Under the employment agreement, Mr. Liu’s compensation shall consist of an annual base salary of $240,000 in cash, and a discretionary annual bonus. Before joining the Company, Mr. Liu served as the manager of the North American market development department in Fulongma Group Co., Ltd., a comprehensive environmental sanitation solutions provider in China, from July 2022 to April 2023. Prior to that, he worked for Ningbo Shunxiang Group Co., Ltd., a polyester film manufacturer in China, as the chief operating officer from July 2019 to July 2022. From July 2018 to June 2019, he served as the project manager for Shouhang New Energy, a solar photovoltaics and energy storage solutions supplier in China. Prior to that, he worked for Hongkun Group, a real estate developer based in China, as the general manger for the Shenzhen area from July 2015 to June 2018. Mr. Liu graduated from Wuhan Institute of Technology with a major in project management.

On May 1, 2023, Singularity Future Technology Ltd. (the “Company”) entered into an employment agreement with Mr. Dianjiang Wang and appointed him as the chief financial officer of the Company, effective immediately, with a term of one year. Under the employment agreement, Mr. Wang’s compensation shall consist of an annual base salary of $60,000, and a discretionary annual bonus. The employment agreement is filed herewith as Exhibit 10.1.

~~On May 1, 2023, pursuant to the bylaws of the Company, our board of directors (the “Board”)~~ elected (i) Mr. Ziyuan Liu as a Class I director to serve until the annual meeting of stockholders for the fiscal year 2022, to fill the vacancy on the Board resulting from the resignation of Mr. Yang Jie, (ii) Mr. Haotian Song as a Class II director to serve until the annual meeting of stockholders for the fiscal year 2023, to fill the vacancy on the Board resulting from the resignation of Mr. Lei Cao, and (iii) Ms. ~~Ling Jiang~~Yangyang Xu as a Class III independent director ~~Chairwoman of the Compensation Committee, a member of the Audit Committee, and a member of the Nominating and Corporate Governance Committee~~ to serve until the annual meeting of stockholders for the fiscal year 2024, to fill the vacancy ~~on the Board~~ resulting from the resignation of ~~Mr. John F. Levy.~~ Ms. Ling ~~Jiang’s~~Jiang. The Board appointed Ms. Xu to serve as Chairwoman of the Compensation Committee and as a member of the Audit Committee and the Nominating and Corporate Governance Committee. Ms. Xu’s annual compensation ~~shall consist of an annual base salary of~~will be $50,000 for her services as a director and committee member. ~~Mr. Ziyuan Liu and Mr. Haotian Song will not receive any compensation for their services as directors~~

On October 19, 2023, New Energy Tech Limited (“New Energy”), a wholly-owned subsidiary of the Company, entered into a project service agreement (the “Service Agreement”) with Faith Group Company. (“Faith”), pursuant to which Faith shall provide Solar EPC project consulting services and Solar panel and associated equipment marketing services to New Energy. Faith guaranteed to source a minimum of 100 MW EPC projects within the first 12 months with a minimum of 20 MW of EPC projects sourced within the first 45 days and also source a minimum of $50 million of solar-related trading business within the 12-month period and with a minimum of $8 million sales contracts in first 45 days. On October 25, 2023, the Company’s wholly owned subsidiary, Sino-Global Shipping HK Ltd, made a prepayment of $2.5 million on behalf of New Energy to Faith as the deposit.

On ~~May 2,~~October 24, 2023, the ~~Board elected Mr. Ziyuan Liu as the new chairman of the Board.~~Company dissolved and disregistered its subsidiary, Ningbo Saimeinuo Web Technology Ltd.

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~~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 provide our freight logistic business, we expanded our services to include warehousing services provided by our US subsidiary Brilliant Warehouse Service Inc. On January 3, 2022, we changed our corporate name to Singularity Future Technology Ltd. Toto align with our entry into the digital assets business through our U.S. subsidiaries. During 2022, we were engaged in purchases and sales of cryptocurrency mining machines through ~~our~~a U.S. subsidiary.

For the ~~nine~~three months ended ~~March 31,~~September 30, 2023, ~~the Company operated~~we were engaged in ~~two segments: (1)~~providing freight logistics services, 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.~~PRC. For the three months ended ~~March 31,~~September 30, 2023, the Company did not sell crypto-mining machines. On March 30, 2023, the board of directors of the Company authorized the Company to conduct an e-commerce business in China, including but not limited to marketing approach of media redirecting.

Recent Developments

~~On September 23, 2022, Hexin Global Limited,~~Since the publication of the Hindenburg Report (as defined below), we have devoted substantial resources and efforts in connection with the investigations by a ~~British Virgin Islands corporation (“Hexin”)~~special committee of our Board of Directors and ~~Viner Total Investments Fund, a Cayman Islands corporation (together~~by U.S. governmental authorities and with ~~Hexin,~~respect to the ~~“Hexin Plaintiffs”) filed a lawsuit in the Southern District~~defense of ~~New York captioned~~ ~~Hexin Global Limited, et al. v. Singularity Future Technology, Ltd., et al.,~~ Case No. 22-cv-08160-LJL, against Singularity Future Technology Ltd. (the “Company”), Yang “Leo” Jie (“Jie”), Jing “Angela” Shan (“Shan”), Tuo “Tina” Pan, and Lei Cao (collectively, the “Defendants”) (the “Hexin Action”). On October 6, 2022, Jinhe Capital Limited, a British Virgin Islands corporation (“Jinhe”) filed a lawsuit in the Southern District of New York against the Company captioned ~~Jinhe Capital Limited v. Singularity Future Technology, Ltd.,~~ Case No. 22-cv-08538-LJL (the “Jinhe Action”). On December 22, 2022, St. Hudson Group LLC, a Delaware limited liability company, Imperii Strategies LLC, a Delaware limited liability company, Isyled Technology Limited, a Hong Kong company, and HSQYNM Family Inc., a New York corporation (together with Jinhelawsuits and the ~~Hexin Plaintiffs, the “Plaintiffs”) filed~~settlement of lawsuits and claims, which are fully described below. As a ~~lawsuit~~result, our business operations have been materially and adversely impacted, including suspension of our business development in ~~the Southern District of New York against the Defendants captioned~~ ~~St. Hudson Group LLC, et al. v. Singularity Future Technology Ltd., et al.,~~ ~~Case No. 22-cv-10290-LJL (together with the Jinhe Action~~North America. We are currently exploring new business opportunities while continuing to provide freight logistics services, which include shipping and ~~Hexin Action, the “Actions”).~~warehouse services. What about

~~The~~On October 19, 2023, New Energy Tech Limited (“New Energy”), a wholly-owned subsidiary of the Company, ~~Shan, and the Plaintiffs~~ entered into a ~~certain settlement~~project service agreement ~~and general mutual release~~(the “Service Agreement”) with ~~an effective date of March 10, 2023 (the “Settlement Agreement”~~Faith Group Company. (“Faith”)~~. Jie also executed the Settlement Agreement. Pursuant~~, pursuant to ~~the Settlement Agreement, the Company~~which Faith agreed to ~~pay~~provide solar engineering, procurement and construction consulting services and solar panel and associated equipment marketing services to New Energy. Faith guaranteed to source a ~~sum~~minimum of ~~ten~~100 MW of solar engineering, procurement and construction consulting projects within the first 12 months with a minimum of 20 MW of solar engineering, procurement and construction consulting projects sourced within the first 45 days and to also source a minimum of $50 million ~~five hundred twenty-five thousand nine hundred and ten dollars and eighty-two cents~~of solar-related trading business within the 12-month period with a minimum of $8 million of sales contracts in ~~U.S. dollars ($10,525,910.82,~~first 45 days. On October 25, 2023, the ~~“Settlement Payment”). Plaintiffs in~~Company’s wholly owned subsidiary, Sino-Global Shipping HK Ltd, made a prepayment of $2.5 million on behalf of New Energy to Faith as the Actions agreed to discharge and forever release the Defendants in the Actions from all claims that were or could have been raised in those Actions, as well as dismissal of each of the Actions with prejudice. The Company has no role or knowledge as to how the Settlement Payment will be allocated between and among the Plaintiffs.deposit.

Special Committee Investigation

On May 5, 2022, an entity named Hindenburg Research issued a report (the “Hindenburg Report”) alleging, among other things, that the Company’s then Chief Executive Officer, Yang Jie, was a fugitive on the run from Chinese authorities for running an alleged $300 million Ponzi scheme that lured in over 20,000 victims. The report also raised questions regarding the Company’s joint venture to produce crypto mining equipment announced in October 2021, as well as a $200 million order purportedly received by the joint venture in January 2022. Further, the report was critical of the Company’s April 2022 announcement of a $250 million partnership with an entity named Golden Mainland Inc. On May 6, 2022, the Board of Directors of the Company (the “Board”) formed a special committee of the Board (the “Special Committee”) to investigate claims of alleged fraud, misrepresentation, and inadequate disclosure related to the Company and certain of its management personnel raised in the Hindenburg Report and other related matters. The Special Committee then retained Blank Rome LLP to serve as independent legal counsel and advise the Committee on the investigation. The Special Committee completed the fact-finding portion of its investigation prior to December 31, 2022. The Special Committee’s preliminary findings corroborated certain of the allegations made in the Hindenburg Report and the investigation resulted in the termination and resignation of certain executive officers and directors of the Company, including but not limited to, the following:

On August 9, 2022, Mr. Yang Jie tendered his resignation from his positions as Chief Executive Officer and director of the Company to the Board, following the Board’s decision on August 8, 2022, which adopted the Special Committee’s recommendation that Mr. Jie be suspended immediately, pending the Special Committee’s further investigation into allegations raised in the Hindenburg Report and other related matters.

On August 16, 2022, attorneys from Blank Rome LLP, counsel for the Special Committee, held a conference call with staff members of the Securities and Exchange Commission (the “SEC”), during which counsel represented that Yang Jie had provided documentation to the SEC that indicated that the charges against him in China had been dropped, but the Special Committee’s investigation raised questions regarding the authenticity of such documents. The Special Committee concluded at that time that Mr. Jie was in fact issued a “Red Notice” in China.

In December 2022, the Company entered into a cancellation agreement and a letter confirming the rescission of the grant of the shares with each of Yang Jie and Ms. Jing Shan, our former Chief Operating Officer, pursuant to which Mr. Jie and Ms. Shan agreed to return 300,000 shares and 100,000 shares of our common stock, respectively, to the Company for cancellation at no cost. Such shares were previously issued to each of them for their services as officers of the Company. The shares were cancelled as of March 31, 2023.

On February 10, 2023, in response to two, now-settled, lawsuits filed by private investors, Mr. Jie filed a motion to dismiss the private investors’ suits and provided a copy of a formal legal opinion issued by the Zhonglun W&D Law Firm, PRC. The Zhonglun W&D legal opinion concluded that Mr. Jie was not charged with a crime in China, the investigation and underlying case had indeed been closed, and Mr. Jie was not formally treated as a criminal suspect in the PRC. In order to provide more clarity to the issues raised, the Company engaged Hebei Mei Dong Law Firm, of Shijiazhuang City, PRC to further investigate the authenticity of the documentation provided by Mr. Jie to the SEC and whether a “Red Notice” had been issued. On June 12, 2023, the Hebei Mei Dong Law Firm issued a report to the Company with respect to these issues. In their report, the Company’s Chinese counsel concluded after conferring with local officials, that the investigation of Mr. Jie conducted by the Baohe District Police Bureau of Hefei City, PRC was completed, that Mr. Jie was never prosecuted and there was no criminal judgment against Mr. Jie as of the date of such report. The Chinese counsel also confirmed that no “Red Notice” was issued for Mr. Jie in the PRC.

On February 23, 2023, the Board approved the dissolution of the Special Committee upon conclusion of the committee’s investigation.

On July 3, 2023, the Company entered into a Settlement ~~Payment~~and Release Agreement with Mr. Jie which fully resolved his claims against the Company.

Executive Changes

On June 16, 2022, Ms. Tuo Pan, Chief Financial Officer of the Company, without proper authorization by the Board, directed that funds be wired to satisfy an invoice for legal services that were rendered or to be rendered on her behalf. Ms. Pan was ~~paid on March 14, 2023.~~suspended by the Board for cause and without pay effective June 20, 2022. On August 31, 2022, Ms. Tuo Pan was terminated for cause as an employee of the Company and its subsidiaries and ceased to receive any salary or benefits from the Company since that date.

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, ~~of Directors of the Company (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)~~Company. The Separation Agreement also provided for 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 onin 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~~and other matters arising out of or related to ~~Mr. Cao’s~~his 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 January 17, 2023, Messrs. John Levy and Heng Wang were appointed as non-executive chairman and vice chairman of the Board, respectively.

On ~~December 19, 2022,~~February 23, 2023, Mr. Levy resigned as a director and ~~December 27, 2022, the Company entered into a cancellation agreement and a letter confirming the rescission~~member of the ~~grant~~Audit Committee, Compensation Committee and Nominating Committee of the shares with each of Yang Jie and Jing Shan, pursuant to which Yang Jie and Jing Shan agreed to return 300,000 shares and 100,000 shares of Common Stock, respectively, to the Company for cancellation at no cost. Such shares were previously issued to each of them for his/her servicesBoard, effective immediately. On March 30, 2023, Mr. Wang was appointed as ~~an officer~~non-executive Chairman of the ~~Company. The shares were cancelled as of~~Board to fill the ~~date of this report.~~vacancy created by Mr. Levy’s resignation.

On ~~February 23,~~April 18, 2023, ~~John Levy tendered his~~the Company entered into an employment agreement with Mr. Ziyuan Liu and appointed him as the chief executive officer of the Company, effective immediately, with a term of one year.

On May 1, 2023, the Company entered into an employment agreement with Mr. Dianjiang Wang and appointed him as the chief financial officer of the Company, effective immediately, with a term of one year.

On May 1, 2023, pursuant to the bylaws of the Company, our Board elected (i) Mr. Ziyuan Liu as a Class I director to serve until the annual meeting of stockholders for the fiscal year 2022, to fill the vacancy on the Board resulting from the resignation of Mr. Jie, (ii) Mr. Haotian Song as a Class II director to serve until the annual meeting of stockholders for the fiscal year 2023, to fill the vacancy on the Board resulting from ~~his positions~~the resignation of Mr. Cao, and (iii) Ms. Ling Jiang as a Class III independent director, Chairwoman of the Compensation Committee, a member of the Audit Committee, and a member of the Nominating and Corporate Governance Committee to serve until the annual meeting of stockholders for the fiscal year 2024, to fill the vacancy on the Board resulting from the resignation of Mr. Levy.

On May 2, 2023, the Board elected Mr. Ziyuan Liu as the new chairman of the Board.

On July 3, 2023, Mr. Tieliang Liu resigned as a director the Company and a member of the Compensation Committee, the Audit ~~Committee, the Compensation~~ Committee, and the Nominating and Corporate Governance ~~Committee,~~Committee.

On July 10, 2023, Company terminated the employment of its Chief Operating Officer, Jing Shan, with cause. The termination was effective immediately.

~~As previously reported,~~On July 31, 2023, the Company elected Mr. Zhongliang Xie as a Class II independent director to serve until the annual meeting of stockholders for the fiscal year 2023, to fill the vacancy on ~~May 6, 2022,~~ the Board ~~formed a special committee~~resulting from the resignation of Mr. Tieliang Liu. The Board appointed Mr. Xie to investigate claims of alleged fraud, misrepresentation, inadequate disclosure, and other related matters related to the Company and certain of its management personnel raised in the report of Hindenburg Research dated May 5, 2022 and other related matters. On February 23, 2023, the Board approved the dissolutionserve as Chair of the ~~special committee upon conclusion~~Audit Committee, a member of the ~~committee’s investigation.~~Compensation Committee and a member of the Nominating and Corporate Governance Committee.

On ~~March 10,~~August 15, 2023, Mr. Dianjiang Wang resigned as the Chief Financial Officer of the Company. Mr. Wang’s decision did not result from any disagreement with the Company relating to its operations, policies, or practices.

On August 21, 2023, the Company Yang Jie, Jing Shan, and the plaintiffs of three actions where the Company is a defendant, including Hexin Global Limited, Viner Total Investments Fund, Jinhe Capital Limited, St. Hudson Group LLC, Imperii Strategies LLC, Isyled Technology Limited, and HS-QYNM Family Inc., entered into ~~a certain settlement~~an employment agreement ~~and general mutual release, pursuant~~with Mr. Ying Cao to ~~which~~serve as the Company agreed to pay a sum of $10,525,910.82. The plaintiffs agreed to discharge and forever release the defendants in the actions from all claims that were or could have been raised in those actions, as well as dismissal of eachChief Financial Officer of the actions with prejudice. The Company has no role or knowledge as to how the settlement payment will be allocated between and among the plaintiffs. In addition, the plaintiffs agreed to irrevocably forfeit 3,728,807 shares of Common Stock they hold, of which the fair value is $2,125,420. The cancellation of 2,400,000 shares has been completed, while the cancellation of the remaining 1,328,807 shares is still in processing.Company.

On September 21, 2023, Mr. Heng Wang resigned as a director of the Company and a member of the Compensation Committee, the Audit Committee, and the Nominating and Corporate Governance Committee.

On ~~March 30,~~September 25, 2023, ~~Heng Wang was appointed~~the Company elected Mr. Xu Zhao as ~~non-executed chairman~~a Class I independent director to serve until the annual meeting of stockholders for the ~~Board~~fiscal year 2022, to fill the vacancy ~~created by John Levy’s resignation.~~on the Board resulting from the resignation of Mr. Heng Wang. The Board appointed Mr. Zhao to serve as a member of the Audit Committee, a member of the Compensation Committee and Chair of the Nominating and Corporate Governance Committee.

On September 28, 2023, Ms. Ling Jiang resigned as a director of the Company and a member of the Compensation Committee, the Audit Committee, and the Nominating and Corporate Governance Committee.

On October 6, 2023, the Company elected Ms. Yangyang Xu as a Class III independent director to serve until the annual meeting of stockholders for the fiscal year 2024, to fill the vacancy resulting from the resignation of Ms. Ling Jiang. The Board appointed Ms. Xu to serve as Chairwoman of the Compensation Committee and as a member of the Audit Committee and the Nominating and Corporate Governance Committee.

Nasdaq Listing Deficiencies

On May 24, 2022, the Company received a delinquency notice from Nasdaq indicating that the Company was not in compliance with Nasdaq Listing Rule 5250(c)(1) due to its delay in filing its Quarterly Report on Form 10-Q for the quarter ended March 31, 2022. The Company was provided 60 days to submit a plan to regain compliance. On July 25, 2022 and September 14, 2022, the Company submitted its plan to regain compliance and supplementary information related to the plan, respectively (collectively, the “Compliance Plan”). Based on the review of the Compliance Plan as well as telephone conversations with outside counsel to the Company and counsel to the Company’s Special Committee, the Staff has determined that the Company did not provide a definitive plan evidencing its ability to file the Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 and the Annual Report on Form 10-K for the fiscal year ended June 30, 2022 (collectively, the “Reports”) within the 180 calendar day period available to the Staff under the Nasdaq Listing Rules.

Specifically, the delisting determination referenced several aspects of the Compliance Plan that raise substantial doubts about the Company’s ability to regain compliance: (i) the unreasonably short timeframe for the Company to file the Reports based on the anticipated timeframe the Special Committee needs to substantially complete its investigation; (ii) the Company’s ability to engage a new independent registered public accounting firm; and (iii) the departure of both the Company’s Chief Executive Officer and Chief Financial Officer.

On November 16, 2022, the Company received an additional staff determination notice from Nasdaq, advising that it had not received the Company’s Form 10-Q for the quarterly period ended September 30, 2022, which served as an additional basis for delisting the Company’s securities and that the Nasdaq Hearings Panel (the “Panel”) will consider the additional deficiency in rendering a determination regarding the Company’s continued listing on The Nasdaq Capital Market. The Company submitted to the Panel a plan to regain compliance with the continued listing requirements, including the filing of the Form 10-Q for the quarterly period ended September 30, 2022.

On January 5, 2023, the Company received a deficiency notice from Nasdaq informing the Company that its common stock, no par value, fails to comply with the $1 minimum bid price required for continued listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2) based upon the closing bid price of the common stock for the 30 consecutive business days prior to the date of the notice from Nasdaq. The Company has been provided an initial compliance period of 180 calendar days, or until July 5, 2023, to regain compliance with the minimum bid price requirement.

On July 13, 2023, the Company received a notice from Nasdaq stating that the Company failed to regain compliance with respect to the minimum $1 bid price per share requirement under Nasdaq Listing Rules during the 180 calendar days given by Nasdaq for the Company to regain compliance, which ended on July 5, 2023. However, Nasdaq has determined that the Company is eligible for an additional 180 calendar day period, or until January 2, 2024, to regain compliance. Such determination is based on the Company meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Capital Market with the exception of the bid price requirement, and the Company’s written notice of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary. The Company intends to regain compliance with Nasdaq’s bid price requirement prior to the end of the second bid price extension.

On February 21, 2023, the Company received an additional staff determination notice from Nasdaq, advising that it had not received the Company’s Form 10-Q for the quarterly period ended December 31, 2022, which served as an additional basis for delisting the Company’s securities. The notice stated that the Nasdaq Hearings Panel will consider the additional deficiency in rendering a determination regarding the Company’s continued listing on Nasdaq. The Company ~~has~~ submitted to the Panel a plan to regain compliance with the continued listing requirements and ~~has been~~was granted a grace period to file all the delinquent reports, including the filing of the Form 10-Q for the quarterly period ended December 31, 2022, on or before February 28, 2023. On March 16, 2023, the Company received a formal notification from Nasdaq confirming that the Company had regained compliance with the Nasdaq Listing Rule 5250(c)(1), which requires the Company to timely file all required periodic financial reports with the SEC, and that the matter is now closed.

On March 8, 2023, the Company received a notice from Nasdaq ~~Listing Qualifications department of The Nasdaq Stock Market LLC~~ stating that the Company no longer complies with Nasdaq’s audit committee requirement under Nasdaq’s Listing Rule 5605 following the resignation of John Levy from the Company’s board of directors and audit committee effective February 23, 2023. Nasdaq advised the Company that in accordance with Nasdaq’s Listing Rule 5605(c)(4), the Company has a cure period to regain compliance (i) until the earlier of the Company’s next annual shareholders’ meeting or February 23, 2024; or (ii) if the next annual shareholders’ meeting is held before August 22, 2023, then the Company must evidence compliance no later than August 22, ~~2023 (the “Cure Period”). The Company intends to regain compliance with Nasdaq’s Listing Rule 5605 prior to the end of the Cure Period.~~2023.

On ~~March 16,~~July 7, 2023, the Company received a Notice of Noncompliance Letter (the “Letter”) from Nasdaq stating that the Company was not in compliance with Nasdaq Listing Rules due to its failure to timely hold an annual meeting of shareholders for the fiscal year ended June 30, 2022, which is required to be held within twelve months of the Company’s fiscal year end under Nasdaq Listing Rule 5620(a) and 5810(c)(2)(G). The Letter also states that the Company has 45 calendar days to submit a plan to regain compliance and if Nasdaq accepts the Plan, it can grant the Company an exception of up to 180 calendar days from the fiscal year end, or until December 27, 2023, to regain compliance. On August 30, 2023, the Company received a formal notification from Nasdaq stating that it has determined to grant the Company an extension until December 27, 2023, to regain compliance with Listing Rule 5620(a), which requires that the Company hold an annual meeting of shareholders within twelve months of the end of the Company’s fiscal year end. On October 19, 2023, the Company received a formal notification from the Nasdaq Stock Market LLC confirming that the Company had regained compliance with ~~the Nasdaq~~ Listing Rule ~~5250(c)(1)~~5620(a), which requires that the Company hold an annual meeting of shareholders within twelve months of the end of the Company’s fiscal year, and that the matter is now closed.

On July 13, 2023, the Company received a notice from Nasdaq stating that the Company no longer complies with Nasdaq’s independent director and audit committee requirements under Nasdaq’s Listing Rule 5605 following the resignation of Mr. Liu from the Company’s board of directors and audit committee effective July 3, 2023. Nasdaq advised the Company that in accordance with Nasdaq’s Listing Rule 5605(c)(4), the Company has a cure period to ~~timely file all required periodic financial reports~~regain compliance (1) until the earlier of the Company’s next annual shareholders’ meeting or July 3, 2024; or (2) if the next annual shareholders’ meeting is held before January 2, 2024, then the Company must evidence compliance no later than January 2, 2024. In response to this notice, on July 31, 2023, the Company elected Mr. Zhongliang Xie as a Class II independent director to serve until the annual meeting of stockholders for the fiscal year 2023, to fill the vacancy on the Board resulting from the resignation of Mr. Liu. The Board appointed Mr. Xie to serve as Chair of the Audit Committee, a member of the Compensation Committee and a member of the Nominating and Corporate Governance Committee. On August 30, 2023, the Company received a formal notification from the Nasdaq Stock Market LLC (“Nasdaq”) confirming that the Company had regained compliance with the ~~Securities~~independent director and ~~Exchange Commission,~~audit committee requirements for continued listing on The Nasdaq Capital Market set forth in Listing Rules 5605(b)(1) and 5605(c)(2) by appointing Mr. Zhongliang Xie to the Company’s board of directors and audit committee on July 31, 2023, and that the matter is now closed.

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 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.

In early December 2022, the Chinese government eased its strict control measures for COVID-19, which led to a surge in increased infections and disruptions in our business operations. Any future impact of COVID-19 on the Company’s China operational 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.

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 the demand for freight logistics services. As a result, our PRC revenue decreased by $546,438, or 24.37%, from $2,242,296 for the nine months ended March 31, 2022 to $1,695,858 for the same period in 2023; there was no material impact for the three months ended March 31, 2023 compared to the same period in the prior year.

●

Due to travel restrictions between US 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.

Although the impact of COVID-19 on our operations decreased in 2023, such impact still exists and may continue to exist for an unforeseeable period of time. The impact of any future spread of COVID-19 on the Company’s China operation will depend, to a large extent, on 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 is beyond our control.

Results of Operations

Comparison of the Three Months Ended ~~March 31,~~September 30, 2023 and 2022

~~Revenues~~

Revenues decreased by $211,842, or approximately 21.8%, from $971,747 for the three months ended March 31, 2022 to $759,905 for the three months ended March 31, 2023. The decrease was primarily due to decreases in freight logistic services, which include shipping and warehouse services.

~~The following tables present summary information by segments for the three months ended March 31, 2023 and 2022:~~

For the Three Months Ended
March 31, 2023
Freight
Logistics
Services Total
Net revenues $ 759,905 $ 759,905
Cost of revenues $ 888,040 $ 888,040
Gross profit $ (128,135 ) $ (128,135 )
Depreciation and amortization $ 42,569 $ 42,569
Total capital expenditures $ 3,534 $ 3,534
Gross margin (16.9 )% (16.9 )%

% Changes For the Three Months Ended
March 31, 2023 and 2022
Freight Logistics Services Total
Net revenues (21.8 )% (21.8 )%
Cost of revenues (1.5 )% (1.5 )%
Gross profit (281.8 )% (281.8 )%
Depreciation and amortization (71.6 )% (71.6 )%
Total capital expenditures (97.7 )% (97.7 )%
Gross margin (24.2 )% (24.2 )%

~~Disaggregated information of revenues by geographic locations are as follows:~~

For the Three Months Ended
March 31, March 31,
2023 2022
PRC $ 535,037 $ 648,964
U.S. 224,868 322,783
Total revenues $ 759,905 $ 971,747

~~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 $759,905 for the three months ended March 31, 2023, a decrease of $211,842, or approximately 21.8%, from $971,747 for the same period in 2022, mainly due to the decrease in fright logistic services of both our PRC and USA operations. Our USA operations mainly related to our warehouse services. Revenue decreased due to reduced customer demand for international e-commerce which continued to be impacted by Covid-19 and inflation. In addition, we have only one single warehouse, which limits our capabilities in handling orders that required multiple warehouses. PRC operations were negatively impacted due to a decrease in demand from a major customer.

~~Operating Costs and Expenses~~

Operating costs and expenses decreased by $5,861,198 or approximately 56.6%, from $10,358,558 for the three months ended March 31, 2022 to $4,497,360 for the three months ended March 31, 2023. This decrease was mainly due to the decrease in selling expenses and stock-based compensation, partially offset by the increase in general and administrative expenses and impairment loss of investment.

The following table sets forth the components of our costs and expenses for the periods indicated:

	For the Three Months Ended March 31,																		For the Three Months Ended September 30,
	2023						2022						Change						2023						2022						Change
	US$			%			US$			%			US$			%			US$			%			US$			%			US$			%

Revenues		759,905			100.0	%		971,747			100.0	%		(211,842	)		(21.8	)%		895,926			100.0	%		1,221,204			100.0	%		(325,278	)		(26.6	)%
Cost of revenues		888,040			116.9	%		901,275			92.7	%		(13,235	)		(1.5	)%		1,002,949			111.9	%		745,627			61.1	%		257,322			34.5	%
Gross margin		(16.9	)%		N/A			7.3	%		N/A			(24.2	)%		N/A			(11.9	)%		N/A			38.9	%		N/A			(50.8	)%		N/A
Selling expenses		39,661			5.2	%		131,404			13.6	%		(91,743	)		(69.8	))%		55,853			6.2	%		27,375			2.2	%		28,478			104.0	%
General and administrative expenses		3,496,247			460.1	%		2,140,749			220.3	%		1,355,498			63.3	%		2,054,153			229.3	%		2,988,920			244.8	%		(934,767	)		(31.3	)%
Recovery (provision) for doubtful accounts, net		(54,958	)		(7.2	)%		669,189			68.9	%		(724,147	)		(108.2	)%
Impairment loss of Cryptocurrencies		-			0.0	%		3,052			0.3	%		(3,052	)		(100.0	)%		72,179			8.1	%		-			0	%		72,179			100	%
Impairment loss of investment		128,370			16.9	%		-			0.0	%		128,370			100.0	%
Provision for doubtful accounts, net																				48,618			5.4	%		-			0	%		48,618			100	%
Stock-based compensation		-			0.0	%		6,512,889			670.2	%		(6,512,889	)		(100.0	)%		-			0	%		247,333			20.3	%		(247,333	)		0	%
Total costs and expenses		4,497,360			591.9	%		10,358,558			1066.0	%		(5,861,198	)		(56.6	)%		3,233,752			360.9	%		4,009,255			328.3	%		(775,503			(19.3	)%

Revenues

The following tables present summary information by segments for the three months ended September 30, 2023 and 2022:

	For the Three Months Ended September 30, 2023
	Freight Logistics Services			Sales of Crypto Mining Machines			Total
Net revenues	$	895,926		$	-		$	895,926
Cost of revenues	$	1,002,949		$	-		$	1,002,949
Gross profit	$	(107,023	)	$	-		$	(107,023	)
Depreciation and amortization	$	37,770		$	357		$	38,127
Total capital expenditures	$	-		$	-		$	-
Gross margin		(11.9	)%		100.0	%		(11.9	)%

	For the Three Months Ended September 30, 2022
	Freight Logistics Services			Sales of Crypto Mining Machines			Total
Net revenues	$	724,159		$	497,045		$	1,221,204
Cost of revenues	$	745,627		$	-		$	745,627
Gross profit	$	(21,468	)	$	497,045		$	475,577
Depreciation and amortization	$	78,945		$	-		$	78,945
Total capital expenditures	$	150,966		$	-		$	150,966
Gross margin		(3.0	)%		100.0	%		38.9	%

	% Changes For the Three Months Ended September 30, 2023 and 2022
	Freight Logistics Services			Sales of Crypto Mining Machines			Total
Net revenues		23.7	%		0	%		(26.6	)%
Cost of revenues		34.5	%		-			34.5	%
Gross profit		398.5	%		0	%		(122.5	)%
Depreciation and amortization		(52.2	)%		-			(51.7	)%
Total capital expenditures		0	%		-			0	%
Gross margin		(8.9	)%		0	%		(50.8	)%

Disaggregated information of revenues by geographic locations are as follows:

	For the Three Months Ended
	September 30,		September 30,
	2023		2022
PRC	$	700,656	$	248,210
U.S.		195,270		972,994
Total revenues	$	895,926	$	1,221,204

Revenues decreased by $325,278, or approximately 26.6%, to $895,926 for the three months ended September 30, 2023 from $1,221,204 for the same period in 2022. The decrease was primarily due to decrease in sales of crypto mining machines. Revenues from our logistics services business increased by $171,767, or approximately 23.7 %, to $895,926 for the three months ended September 30, 2023 from $724,159 for the same period in 2022.The Company ceased to sell crypto-mining equipment since January 1, 2023.

Cost of Revenues

Cost of revenues for our freight logistics services 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~~logistics services segment was ~~$888,040~~$1,002,949 for the three months ended ~~March 31,~~September 30, 2023, ~~a decrease~~an increase of ~~$13,235,~~$257,322, or approximately ~~1.5 %,~~34.5%, as compared to ~~$901,275~~$745,627 for the same period in 2022 as a result of the increase in freight costs of our ~~revenue decreased.~~ PRC operations caused by the increase in shipping volume due to the pandemic.

Our gross margin ~~decreased from 7.3% to (16.9)%~~was (11.9%) and 38.9% for the three months ended ~~March 31,~~September 30, 2023 and 2022, ~~and 2023, respectively, as a result of lower~~respectively. This decrease in gross margin ~~from Brilliant Warehouse as a result of higher fixed costs.~~

~~Selling Expenses~~

Our selling expenses consisted primarily of salaries for our sales representatives. For the three months ended March 31, 2023, we had $39,661 of selling expenses as compared to $131,404 of selling expenses for the same period in 2022, which represents a decrease of $91,743 or approximately 69.8%. The decrease was mainly due to ~~a decrease in salaries as we reduced the headcount and marketing fees of the freight logistics segment for our selling team compared to the same period of 2022.~~

~~General and Administrative Expenses~~

Our general and administrative expenses consist primarily of salaries and benefits, travel expenses for administration department, office expenses, regulatory filing and professional service fees including audit, legal and IT consulting. For the three months ended March 31, 2023, we had $3,496,247 of general and administrative expenses, as compared to $2,140,749 for the same period in 2022, representing an increase of $1,355,498, or approximately 63.3%. The increase was mainly due to the increase in professional fees of approximately $1.5 million which are mainly legal fees.

~~Recovery (provision) for doubtful accounts, net~~

We recovered $54,958 of doubtful accounts receivable from related parties for the three months ended March 31, 2023, compared to $669,189 of provision for doubtful accounts receivable and other receivables for the same period in 2022.

~~Impairment Loss of Cryptocurrencies~~

We recorded nil in impairment losses for the three months ended March 31, 2023, compared to a $3,052 impairment loss for the same period in 2022 due to price drops in bitcoin which we deemed a triggering event for impairment testing.

~~Impairment Loss of Investment~~

We recorded $128,370 and nil impairment losses related to investments for the three months ended March 31, 2023 and 2022, respectively, due to impairment of our investment in LSM Trading Ltd. Due to the continuing losses of the investee, we determined the loss is other than temporary and provided full impairment of our equity investment.

~~Stock-based Compensation~~

Stock-based compensation was nil for the three months ended March 31, 2023 as compared to $6,512,889 for the same period in 2022 due to no stock compensation grants to our directors and executives and third-party advisors in the 2023 period.

~~Lawsuit settlement expenses~~

~~We recorded $8,400,491 in lawsuit settlement expenses for the three months ended March 31, 2023, compared to nil in lawsuit settlement expenses for the same period in 2022.~~

~~Other Income (Expenses), Net~~

Total other income, net was $95,319 for the three months ended March 31, 2023, and total other expenses, net was $35,709 for the same period in 2022. The change is mainly due to the gain on disposal of right of use assets of $0.2 million in March 2023.

~~Taxes~~

~~We recorded nil income tax expense for both the three months ended March 31, 2023 and 2022.~~

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 March 31, 2023 amounted to approximately $13,300,000. The Tax benefit derived from this NOL was approximately $2,793,000. As of March 31, 2023, our cumulative NOL amounted to approximately $42,600,000. 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 March 31, 2023. During the three months ended March 31, 2023, we generated an additional NOL of approximately nil. March 31, 2023, our PRC subsidiaries’ cumulative NOL amounted to approximately $5,634,000, which may reduce future taxable income and will expire by 2026.

We periodically evaluate the likelihood of the realization of our deferred tax assets and reduce the carrying amount of the deferred tax assets by a valuation allowance to the extent we believe 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 would 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 March 31, 2023. The net decrease in valuation for the three months ended March 31, 2023 amounted to approximately $2,921,000 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 $12,042,627 for the three months ended March 31, 2023, compared to $9,422,520 for the same period in 2022. After the deduction of non-controlling interest, net loss attributable to us was $11,922,767 for the three months ended March 31, 2023, compared to $9,430,059 for the same period in 2022. Comprehensive loss attributable to us was $12,005,947 for the three months ended March 31, 2023, as compared to $9,166,723 for the same period in 2022.

~~Comparison of the Nine Months ended~~ ~~March 31, 2023~~ ~~and 2022~~

~~Revenues~~

~~Revenues increased by $642,358, or approximately 22.7%, from $2,829,682 for the nine months ended March 31, 2022 to $3,472,040 for the same period in 2023. The increase was primarily due to increased~~decreased revenue from our sale of crypto mining equipment. ~~The Company ceased to sell crypto-mining equipment since January 1, 2023.~~

~~The following tables present summary information by segments mainly regarding~~We recognized this revenue on a net basis, thus decreasing the ~~top-line financial results for the nine months ended March 31, 2023 and 2022:~~

For the Nine Months Ended
March 31, 2023
Freight
Logistics
Services Crypto-
mining
equipment
sales Total
Net revenues $ 2,739,475 $ 732,565 $ 3,472,040
Cost of revenues $ 2,944,804 $ - $ 2,944,804
Gross profit $ (205,329 ) $ 732,565 $ 527,236
Depreciation and amortization $ 101,970 $ 20,729 $ 122,699
Total capital expenditures $ 154,500 $ - $ 154,500
Gross margin% (7.5 )% 100 % 15.2 %

For the Nine Months Ended
March 31, 2022
Freight
Logistics
Services Crypto-
mining
equipment
sales Total
Net revenues $ 2,829,682 $ - $ 2,829,682
Cost of revenues $ 2,973,034 $ - $ 2,973,034
Gross profit $ (143,352 ) $ - $ (143,352 )
Depreciation and amortization $ 428,635 $ - $ 428,635
Total capital expenditures $ 775,107 $ - $ 775,107
Gross margin% (5.1 )% - % (5.1 )%

●

~~Including related party revenue from Zhejiang Jinbang Fuel Energy Co., Ltd of nil and $224,690 for the nine months ended March 31, 2023 and the same period in 2022, respectively.~~

% Changes For the Nine Months Ended
March 31, 2023 to 2022
Freight
Logistics
Services Crypto-
mining
equipment
sales Total
Net revenues (3.2 )% 100 % 22.7 %
Cost of revenues (0.9 )% - % (0.9 )%
Gross profit 43.2 % 100 % (467.8 )%
Depreciation and amortization (76.2 )% 100 % (71.4 )%
Total capital expenditures (80.1 )% - % (80.1 )%
Gross margin% (2.4 )% 100 % 20.3 %

~~Disaggregated information~~overall margin of ~~revenues by geographic locations are as follows:~~

For the
nine months
ended
March 31,
2023 For the
nine months
ended
March 31,
2022
PRC $ 1,695,858 $ 2,242,296
U.S. 1,776,182 587,386
Total revenues $ 3,472,040 $ 2,829,682

~~Revenues~~

our operations.

~~Revenues from Freight Logistics Services~~

Freight logistics services primarily consist of cargo forwarding, brokerage and warehouse services. The revenues from freight logistics services were $2,739,475 for the nine months ended March 31, 2023, a decrease of $90,207, or 3.2%, as compared to $2,829,682 for the same period in 2022. The decrease in shipping revenue of approximately $0.5 million from our PRC operation was due to a decrease in demand from a major customer, offset in part to an increase of revenue from our U.S. subsidiary, Brilliant Warehouse, of approximately $0.6 million.

~~Revenues from Sales of Crypto Mining Machines~~

For the nine months ended March 31, 2023 and 2022, sale of crypto mining machines generated revenues of $732,565 and nil, respectively as we entered into sales contract with SOSNY. Our contract with the Buyer was terminated in December 2022. The Company ceased to sell crypto-mining equipment since January 1, 2023.

Operating Costs and Expenses

Operating costs and expenses decreased by ~~$6,351,805~~$775,503 or ~~31.7%,~~approximately 19.3% from ~~$20,035,587~~$3,233,752 for three months ended September 30, 2023 compared to $4,009,255 for the ~~nine months ended March 31, 2022 to $13,683,782 for the nine months ended March 31, 2023.~~same period in 2022. This decrease was mainly due to the ~~significant~~ decrease ~~in stock-based compensation, partially offset by the increase~~ in general and administrative expenses and ~~impairment loss of investment.~~

~~The following table sets forth the components of the Company’s costs and expenses for the periods indicated:~~

For the Nine Months Ended March 31,
2023 2022 Change
US$ % US$ % US$ %

Revenues 3,472,040 100.0 % 2,829,682 100.0 % 642,358 22.7 %
Cost of revenues 2,944,804 84.8 % 2,973,034 105.1 % (28,230 ) (0.9 )%
Gross margin 15.2 % N/A (5.1 )% N/A 20.3 % N/A
Selling expenses 93,884 2.7 % 403,025 14.2 % (309,141 ) (76.7 ))%
General and administrative expenses 10,219,951 294.4 % 6,258,749 221.2 % 3,961,202 63.3 %
Impairment loss of Cryptocurrencies 14,801 0.4 % 53,179 1.9 % (38,378 ) (72.2 )%
Impairment loss of investment 128,370 3.7 % - 0 % 128,370 100 %
Recovery (provision) for doubtful accounts, net (47,805 ) (1.4 )% 530,311 18.7 % (578,116 ) (109.0 )%
Stock-based compensation 329,777 9.5 % 9,817,289 347.0 % (9,487,512 ) (96.6 )%
Total costs and expenses 13,683,782 394.1 % 20,035,587 708.0 % (6,351,805 ) (31.7 )%

~~Cost of Revenues~~

Cost of revenues consisted primarily of freight costs to various freight carriers, the cost of labor, and other overhead and sundry costs. Cost of revenues was $2,944,804 for the nine months ended March 31, 2023, a decrease of $28,230, or approximately 0.9%,stock-based compensation as compared to $2,973,034 for the same period in 2022.Our gross margin increased from (5.1)% to 15.2% mainly due to the sales of crypto-mining machines for the nine months ended March 31, 2023. We did not have this segment for the same period of 2022. We recognized this revenue on a net basis, thus increasing the overall margin of our operations.more fully discussed below.

Selling Expenses

Our selling expenses consisted primarily of salaries, meals and entertainment and travel expenses for our sales representatives. For the ~~nine~~three months ended ~~March 31,~~September 30, 2023, we had ~~$93,884 of~~$55,853 in selling expenses, as compared to ~~$403,205~~$27,375 for the same period in 2022, which represents ~~a decrease~~an increase of ~~$309,141~~$28,478 or approximately ~~76.7%~~104%. The ~~decrease~~increase was mainly due to ~~a decrease~~an increase in ~~salaries and~~ marketing expenses for our freight logistics segment in the PRC ~~due to the impact of COVID-19~~ compared to the same period in 2022.

General and Administrative Expenses

Our general and administrative expenses consist primarily of salaries and benefits, travel expenses for our administration department, office expenses, and regulatory filing and professional service fees ~~including audit,~~for auditing, legal and IT consulting. For the ~~nine~~three months ended ~~March 31,~~September 30, 2023, we had ~~$10,219,951~~$2,054,153 of general and administrative expenses, as compared to ~~$6,258,749~~$2,988,920 for the same period in 2022, representing ~~an increase~~a decrease of ~~$3,961,202,~~$934,767, or approximately ~~63.3%~~31.3%. The ~~increase~~decrease was mainly due to the ~~increase~~decreased professional fees of approximately ~~$4.0~~$1.4 million which are mainly legal fees relating to the Company’s special committee’s investigation of claims of alleged fraud, misrepresentation, and inadequate disclosure related to the Company and certain of its management personnel raised in the Hindenburg Report and other related matters.

Provision for doubtful accounts, net

Our total bad debt expenses amounted to approximately $48,618, mainly due to the bad debt provision in $50,000 for the deposit of the early termination of the lease agreement in, Jericho, New York.

Impairment Loss of Cryptocurrencies

~~The Company~~We recorded an impairment ~~losses~~ of ~~$14,801 and $53,179~~$72,179 for the ~~nine months ended March 31, 2023 and 2022, respectively, due to price drops in~~ bitcoin ~~which~~held by us as the ~~Company deemed a triggering event for impairment testing.~~

~~Impairment Loss of Investment~~

~~The Company recorded $128,370 and nil impairment loss of investment for the nine months ended March 31, 2023 and 2022, respectively, due to the impairment~~ownership of the ~~Company’s investment in LSM Trading Ltd.~~

~~Provision for Doubtful Accounts, Net of Recovery~~

We recovered $47,805 of doubtful accounts receivable from related parties for the nine months ended March 31, 2023, compared to $530,311 of provision for doubtful accounts receivable and other receivables for the same period in 2022.cryptocurrencies could not be verified.

Stock-based Compensation

~~Stock-based~~Our stock-based compensation was ~~$329,777~~$nill and $247,333 for the ~~nine~~three months ended ~~March 31,~~September 30, 2023 ~~a decrease of $9,487,512 or 96.6%, as compared to $9,817,289 for the same period in 2022, as we issued less stock compensation to employees~~ and ~~directors.~~2022.

~~Lawsuit settlement expenses~~Other Expenses, Net

~~We recorded $8,400,491 in lawsuit settlement~~Other expenses, net was $77,170 for the three months ended September 30, 2023, which mainly consisted of interest expense for our convertible debt of approximately $21,917 and exchange gain or loss of $56,042, compared to $61,643 of interest expenses for ~~the nine months ended March 31, 2023, compared to nil in lawsuit settlement expenses~~our convertible debt for the same period in 2022.

~~Taxation~~Taxes

We ~~recorded~~did not record any income tax ~~expenses of $103,426 and nil~~expense for both the ~~nine~~three months ended ~~March 31,~~September 30, 2023 and ~~2022, respectively.~~2022.

~~We have~~The Company’s operations in the U.S. incurred a cumulative U.S. federal net ~~operating loss~~operation losses (“NOL”) of approximately ~~$22,000,000~~$41.7 million as of June 30, ~~2022,~~2023, which may reduce future federal taxable income. ~~The NOL generated prior to the year ended June 30, 2017 amounted to approximately $1,400,000 will expire in 2037 and the remaining balance carried forward indefinitely.~~ During the ~~nine~~three months ended ~~March 31,~~September 30, 2023, approximately ~~$20,500,000~~$2.1 million of ~~additional~~ NOL was generated and the tax benefit derived from such NOL was approximately ~~$4,300,000.~~$9.2 million. As of September 30, 2023, the Company’s cumulative NOL amounted to approximately $43.8 million, which may reduce future federal taxable income.

~~Our~~The Company’s operations in China ~~have~~ incurred ~~a cumulative~~ a cumulative NOL of approximately ~~$1,333,000~~$1.7 million as of June 30, ~~2022,~~2023 which was mainly from net loss. During the three months ended September 30, 2023, additional NOL of approximately $0.1 million was generated. As of September 30, 2023, the Company’s cumulative NOL amounted to approximately $1.8 million which may reduce future taxable income. During the nine months ended March 31, 2023, additional NOL of approximately $303,000 was generated. The NOL amounted to approximately $5,634,000 start expiring from 2023 and the remaining balance of NOLincome which will ~~be expired~~expire by 2026.

WeThe Company periodically ~~evaluate~~evaluates the likelihood of the realization of ~~our~~ deferred tax assets (“DTA”) and ~~reduce~~reduces the carrying amount of the deferred tax assets by a valuation allowance to the extent ~~we believe~~it believes a portion will not be realized. Management considers new evidence, both positive and negative, that could affect ~~our~~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. WeThe Company determined that it is more likely than not ~~that our~~its deferred tax assets ~~would~~could not be realized due to uncertainty on future earnings as a result of the ~~deterioration of trade negotiations between the U.S.~~Company’s reorganization and ~~China. We~~venture into new businesses. The Company provided a 100% allowance for ~~our deferred tax assets~~its DTA as of ~~March 31,~~September 30, 2023. The net ~~decrease~~increase in valuation for the ~~nine~~three months ended ~~March 31,~~September 30, 2023 amounted to approximately ~~$4,385,000~~$479,000, based on management’s reassessment of the amount of ~~our~~the Company’s deferred tax assets that are more likely than not to be realized.

Net ~~loss~~Loss

As a result of the foregoing, we had a net loss of ~~$18,739,820~~$2,414,996 for the ~~nine~~three months ended ~~March 31,~~September 30, 2023 compared to a net loss of ~~$23,455,465~~$2,950,326 for the same period in 2022. After the deduction of non-controlling interest, net loss attributable to ~~the Company~~us was ~~$18,739,615~~$2,290,185 for the ~~nine~~three months ended ~~March 31,~~September 30, 2023 compared to ~~$23,151,814~~$3,084,352 for the same period in 2022. Comprehensive loss attributable to ~~the Company~~us was ~~$18,675,093~~$2,167,204 for the ~~nine~~three months ended ~~March 31,~~September 30, 2023 compared to ~~$22,638,703~~$2,930,353 for the same period in 2022.

Liquidity and Capital Resources

As of ~~March 31,~~September 30, 2023, we had ~~$21,609,701~~$10,054,652 in cash (including cash on hand and cash in bank). The majority of our cash is in banks located in the ~~U.S.~~HK.

~~As of March 31, 2023, we had the following loans outstanding:~~

Loans Maturities Interest
rate March 31,
2023
Convertible Notes December 2023 5 % $ 5,000,000

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

	For the Nine Months Ended March 31,						For the Three Months Ended September 30,
	2023			2022			2023			2022

Net cash (used in) provided by operating activities	$	(32,261,404	)	$	13,706,220
Net cash used in operating activities							$	(1,999,968	)	$	(3,161,398	)
Net cash provided by (used in) investing activities	$	749,826		$	(6,054,445	)	$	49,969		$	(80,701	)
Net cash (used in) provided by financing activities	$	(2,125,420	)	$	7,422,414
Net cash used in financing activities							$	(5,403,424	)	$	-
Net decrease in cash							$	(7,353,423	)	$	(3,242,099	)
Cash at the beginning of period							$	17,390,156		$	55,833,282
Effect of exchange rate fluctuations on cash	$	(586,583	)	$	434,900		$	17,919		$	(130,980	)
Net (decrease) increase in cash	$	(34,223,581	)	$	15,509,089
Cash at the beginning of period	$	55,833,282		$	44,837,317
Cash at the end of period	$	21,609,701		$	60,346,406		$	10,054,652		$	52,460,203

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

	March 31,		June 30,								September 30,		June 30,
	2023		2022		Variation			%			2023		2023		Variation			%

Total Current Assets	$	22,780,619	$	63,165,462	$	(40,384,843	)		(63.9	)%	$	10,688,704	$	18,192,716	$	(7,504,012	)		(41.2	)%
Total Current Liabilities	$	10,359,940	$	25,212,959	$	(14,853,019	)		(58.9	)%	$	4,667,742	$	5,031,769	$	(364,027	)		(7.2	)%
Working Capital	$	12,420,679	$	37,952,503	$	(25,531,824	)		(67.3	)%	$	6,020,962	$	13,160,947	$	(7,139,985	)		(54.3	)%
Current Ratio		2.20		2.51		(0.31	)		(12.4	)%		2.29		3.62		(1.33	)		(36.7	)%

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 ~~March 31,~~September 30, 2023, our working capital was approximately ~~$12.4~~$6.0 million and we had cash of approximately ~~$21.6~~$10.1 million. We believe our current working capital is sufficient to support our operations and debt obligations as they become due for the next twelve months.

Operating Activities

Our net cash used in operating activities was approximately ~~$32.3~~$2.0 million for the ~~nine~~three months ended ~~March 31,~~September 30, 2023. The operating cash outflow for the ~~nine~~three months ended ~~March 31,~~September 30, 2023 was primarily attributable to our net loss of approximately ~~$18.7~~$2.4 million ~~which included a $8.4~~adjusted by non-cash lease expense of $0.1 million ~~lawsuit settlement. Our cash outflow also included deferred revenue~~and impairment loss of ~~approximately $6.7 million where we realized revenue from the sale~~cryptocurrencies of crypto mining equipment and decrease in refund payable of $13.0 million as a result of the settlement payment to SOSNY, offset by cash inflow consisting of advance to a related party supplier of approximately $6.2 million which we realized as the cost for the sale of cryptocurrency equipment.$0.1 million.

Our net cash ~~provided by~~used in operating activities was approximately ~~$13.7~~$3.2 million for the ~~nine~~three months ended ~~March 31,~~September 30, 2022. The operating cash outflow for the ~~nine~~three months ended ~~March 31,~~September 30, 2022 was primarily attributable to our net loss of approximately ~~$23.5~~$3.0 million, adjusted by non-cash stock-based compensation of approximately ~~$9.8 million, loss on disposal of subsidiaries and VIE of approximately $6.1 million, and approximately $0.5 million of provision for doubtful accounts.~~$0.2 million. We had ~~an increase~~a decrease in cash inflow ~~from collection~~ of other receivables of approximately ~~$1.3~~$0.2 million and receipt of approximately $39.7 million for the purchase and sale agreement with SOSNY. As a result of the lawsuit settlement with SOSNY, we were required to pay SOS $13.0 million in December 2022. As such our cash inflow was reflected as an increase in deferred revenue of approximately ~~$26.7~~$4.6 million ~~and refund payable~~as we received the advanced payment for the sale of ~~$13.0 million.~~cryptocurrency equipment. Our ~~main~~ cash ~~outflow is due~~inflow was decreased by an advance to ~~the deposit we made of approximately $21.4 million to our~~a related party supplier ~~HighSharp.~~ of approximately $4.1 million which was for the purchase of cryptocurrency equipment.

Investing Activities

Net cash provided by investing activities was approximately ~~$0.7~~$0.05 million for the ~~nine~~three months ended ~~March 31,~~September 30, 2023 due to ~~cash inflows from repayment of a loan receivable of approximately $0.6 million from Qinggang Wang and Lei Cao, who are related parties, and $90,000 from the sale of property and equipment, and~~ repayments from related parties ~~of approximately $0.7 million including $0.6 million~~ from Zhejiang Jinbang Fuel Energy Co., Ltd (“Zhejiang Jinbang”) which is owned by Mr. Qinggang Wang, and approximately $0.1 million from Qinggang Wang, offset by cash outflows from advance to related parties of approximately $0.4 million including approximately $0.4 million to Zhejiang Jinbang Fuel Energy Co., Ltd (“Zhejiang Jinbang”) which is owned by Mr. Qinggang Wang and approximately $38,000 to Shanghai Baoyin Industrial Co., Ltd.(“Baoyin”) which is 30% owned by Qinggang Wang and purchase of equipment of approximately $0.2 million.Wang.

Net cash ~~used in~~provided by investing activities was ~~$6,054,445~~approximately $80,701 for the ~~nine~~three months ended ~~March 31,~~September 30, 2022 due to the acquisition of property and equipment of approximately ~~$0.8~~$0.2 million ~~investment~~and a loan receivable of approximately ~~$0.2 million to a joint venture named LSM Trading Ltd., in which we hold a 40% of equity interest. We also~~$70,265 as related parties made related party advances of approximately $5.1 million, including approximately $3.2 million of advances to Rich Trading Co. Ltd., a related party. $1.3 million to Shanghai Baoyin Industrial Co., Ltd.(“Baoyin”) which is 30% owned by Qinggang Wang, a related party and approximately $0.6 million of advances to our equity investee, LSM Trading Ltd. These advances are non-interest bearing and duepayments on ~~demand.~~time.

Financing Activities

~~Financing~~Net cash used in financing activities for the ~~nine~~three months ended ~~March 31,~~September 30, 2023 was ~~mainly payment~~$5.4 million due to the repayment of ~~$2.1~~$5 million ~~for fair value~~ of ~~shares to be cancelled in our legal settlement.~~convertible notes and the accrued interest of $403,424.

~~Net cash provided by~~We did not have any financing activities ~~was approximately $7.4 million~~ for the ~~nine~~three months ended March 31, 2022 due to the issuance of common stock in private placements of approximately $10.5 million and proceeds from convertible notes of $10 million, partially offset by repayment of convertible notes of $5.0 million and warrant repurchases of approximately $7.9 million. September 30, 2022.

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~~2023 (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 ~~March 31,~~September 30, 2023, 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 Group;

●

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 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 will be implementing additional policies and procedures, which may include:

●

Hiring additional accounting staff to report the internal financial timely;

●

~~Hiring of CFO 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 CFO and reviewed by CEO, communicated 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 ~~March 31,~~September 30, 2023 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

On October 3, 2021, the Company entered into a Strategic Alliance Agreement with HighSharp (Shenzhen Gaorui) Electronic Technology Co., Ltd. (“HighSharp”) to establish a joint venture for collaborative engineering, technical development and commercialization of a bitcoin mining machine under the name Thor Miner Inc. (“Thor Minor”) , granting Thor Miner exclusive rights covering design production, intellectual property, branding, marketing and sales. On October 11, 2021, Thor Miner was formed in Delaware and is 51% owned by the Company and 49% owned by HighSharp.

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. (a NYSE listed holding company, which provides marketing data, technology and solutions to the emergency rescue services in China, filed a lawsuit in the New York State Supreme Court on December 9, 2022 against Thor Miner ( together with the Company, 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 Purchase and Sale Agreement dated January 10, 2022 (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 (the “Settlement Agreement”). Pursuant to the Settlement Agreement, Thor Miner agreed to pay $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 made in December 2022 and SOSNY dismissed the lawsuit with prejudice against us and the other Defendants on December 28, 2022.

The Company and Thor Miner further covenanted and agreed that if they receive additional funds from HighSharp related to the PSA, they will promptly transfer such funds to SOSNY in an amount not to exceed $40,560,569 (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 will be deducted from the total amount of $40,560,569 previously paid by, and now due and owing to SOSNY. In further consideration of the Settlement Agreement, Thor Miner provided SOSNY an assignment of all claims it may have against HighSharp or otherwise to the proceeds of the PSA.

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, the 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 were investors that entered into a securities purchase agreement with the Company in December 2021 as more fully described below. Each of these plaintiffs asserted causes of action for, among other things, violations of the 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 claimed monetary damages of “at least $6 million,” plus interest, costs, fees, and attorneys’ fees. The St. Hudson lawsuit claimed monetary damages of “at least $4.4 million,” plus interest, costs, fees, and attorneys’ fees.

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 claimed monetary damages of “at least $575,000” and “potentially exceeding $1.8 million,” plus interest, costs, and attorneys’ fees.

On January 10, 2023, the St. Hudson lawsuit was consolidated with the Jinhe lawsuit and Hexin lawsuit and 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. The Company, Yang Jie, Jing Shan, and the plaintiffs in the three actions entered into a certain settlement agreement and general mutual release with an effective date of March 10, 2023, pursuant to which the Company agreed to pay the plaintiffs $10,525,910.82. The plaintiffs agreed to discharge and forever release the defendants from all claims that were or could have been raised in those actions, as well as dismissal of each of the actions with prejudice. The Company has no role or knowledge as to how the settlement payment will be allocated between and among the plaintiffs. The Company made the settlement payment on March 14, 2023. The plaintiffs agreed to irrevocably forfeit 3,728,807 shares of Common Stock they hold. The cancellation of these shares has been completed. The fair value of the shares was $2,125,420 on March 10, 2023, the settlement amount over the fair value of the cancelled shares was recorded as other expenses in the Company’s consolidated statement of operations.

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. On February 7, 2023, two additional plaintiffs moved to be appointed as the lead class plaintiff in this action; those motions remain under the Court’s consideration. As this action is still in the early stage, the Company cannot predict the outcome.

On March 23, 2023, SG Shipping & Risk Solution Inc., an indirect wholly owned subsidiary of of our company, entered into an operating income right transfer contract with Goalowen Inc. pursuant to which Goalowen agreed to transfer its rights to receive income from operating a tuna fishing vessel to SG Shipping for $3 million. Such contract was signed by the Company’s former COO Jing Shan without the Board’s authorization. On May 5, 2023, Ms. Shan made a wire transfer of $3 million to Goalowen without the Board’s authorization,. The Company filed a complaint against Jing Shan accusing her of the unauthorized transfers.

On October 23, 2023, the Company filed a complaint against its former CFO, Tuo Pan, accusing her of conversion due to her alleged involvement in two unauthorized transfers from the Company, amounting to $219,000 and $7,920, respectively.

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

Government Investigations

Following a publication of the Hindenburg Report, 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 these governmental authorities regarding these matters. The Company is not able to estimate the outcome or duration of the government investigations.

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.~~2023. There have been no material changes to the legal proceedings disclosed in our ~~2022~~2023 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)~~our) Annual Report on Form 10-K for the fiscal year ended June 30, ~~2022,~~2023, as filed with the SEC on ~~March 6,~~September 29, 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
10.1		~~Form of Settlement~~New Energy Project Service Agreement by and between ~~SOS Information Technology~~ New ~~York, Inc. and Thor Miner, Inc., the Company, Lei Cao, Yang Jie, John F. Levy, Tieliang Liu, Tuo Pan, Shi Qiu, Jing Shan, and Heng Wang (1)~~
~~10.2~~		~~Settlement Agreement dated March 10, 2023, by and between Hexin Global Limited, Viner Total Investments Fund, Jinhe Capital Limited, St. Hudson Group LLC,, Imperii Strategies LLC, Isyled Technology~~Energy Tech Limited and ~~HSQYNM Family Inc., and Singularity Future Technology Ltd., Yang “Leo” Jie, and Jing “Angela” Shan (2)~~Faith Group Company, dated October 19, 2023.
31.1*		Certification of the Principal Executive 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.
31.2*		Certification of the 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.
32.1*		Certifications of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*		Certifications of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
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).

~~(1)~~

~~Incorporated herein by reference to exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 5, 2023.~~

~~(2)~~

~~Incorporated herein by reference to exhibit 10.1 to the Company’s Current Report on Form 8-K filed on March 16, 2023.~~

*	Filed 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.

~~May 15,~~November 13, 2023	By:	/s/ Ziyuan Liu
		Ziyuan Liu
		Chief Executive Officer

~~May 15,~~November 13, 2023	By:	/s/ ~~Dianjiang Wang~~Ying Cao
		~~Dianjiang Wang~~Ying Cao
		Chief Financial Officer

4842

	For the three and nine months ended
	March 31, 2022
	VIE		Subsidiaries		Total
Total current assets	$	83,573	$	20,898	$	104,471

Total other assets		8,723		-		8,723

Total assets		92,296		20,898		113,194

Total current liabilities		41,608		1,100		42,708
Total net assets		50,688		19,798		70,486
Noncontrolling interests		5,919,050		-		5,919,050
Exchange rate effect		142,080		-		142,080
Total loss on disposal	$	6,111,818	$	19,798	$	6,131,616

	Options			Weighted Average Exercise Price

Options outstanding, as of June 30, 2022		2,000		$	10.05
Granted		-			-
Exercised		-			-
Cancelled, forfeited or expired		(2,000	)		10.05
Options outstanding, as of March 31, 2023		-		$	-
Options exercisable, as of March 31, 2023		-		$	-

	For the three months Ended March 31				For the nine months Ended March 31
	2023		2022		2023		2022
Current
U.S.	$	-	$	-	$	103,426	$	-
PRC		-		-		-		-
Total income tax expenses		-		-		103,426		-

	For Nine Months Ended March 31, 2023
	Freight Logistics Services			Crypto-mining equipment sales			Total
Net revenues	$	2,739,475		$	732,565		$	3,472,040
Cost of revenues	$	2,944,804		$	-		$	2,944,804
Gross profit	$	(205,329	)	$	732,565		$	527,236
Depreciation and amortization	$	101,970		$	20,729		$	122,699
Total capital expenditures	$	154,500		$	-		$	154,500
Gross margin%		(7.5	)%		100.0	%		15.2	%

	For the Nine Months Ended March 31, 2023
	Freight Logistics Services			Crypto- mining equipment sales			Total
Net revenues	$	2,739,475		$	732,565		$	3,472,040
Cost of revenues	$	2,944,804		$	-		$	2,944,804
Gross profit	$	(205,329	)	$	732,565		$	527,236
Depreciation and amortization	$	101,970		$	20,729		$	122,699
Total capital expenditures	$	154,500		$	-		$	154,500
Gross margin%		(7.5	)%		100	%		15.2	%

	For the nine months ended March 31, 2023		For the nine months ended March 31, 2022
PRC	$	1,695,858	$	2,242,296
U.S.		1,776,182		587,386
Total revenues	$	3,472,040	$	2,829,682

Loans		Maturities		Interest rate				March 31, 2023
Convertible Notes		December 2023			5	%		$	5,000,000