10q10k10q10k.net

What changed in Singularity Future Technology Ltd.'s 10-K — 2022 vs 2023

vs

Paragraph-level year-over-year comparison of Singularity Future Technology Ltd.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+325 added−200 removedSource: 10-K (2023-09-29) vs 10-K (2023-03-06)

Top changes in Singularity Future Technology Ltd.'s 2023 10-K

325 paragraphs added · 200 removed · 140 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

63 edited+152 added−27 removed25 unchanged
Biggest changeBased 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. 2 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.
Biggest changeBased 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.
On May 6, 2022, the Board of Directors of the Company (the “Board”) formed a special committee of its Board of Directors (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.
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.
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.
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.
Intellectual Property As of the date of this Report, we do not have any registered patents, copyrights, or trademarks other than two pending trademark applications for “Thor” and “Thor Miner.” We have seven registered domain names, including our corporate website https://www.singularity.us/.
Intellectual Property As of the date of this Report, we do not have any registered patents, copyrights, or trademarks other than two pending trademark applications for “Thor” and “Thor Miner.” We have seven registered domain names, including our corporate website https://www.singularity.us/. 18
Cao submitted a letter of resignation from the Board on January 9, 2023. In addition, he agreed to forfeit and return to the Company the 600,000 shares of common stock of the Company granted to him on August 13, 2021 under the terms of the 2014 Equity Incentive Plan of the Company (the “2021 Shares”). Mr.
Cao 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 in August 2021 under the terms of the 2014 Equity Incentive Plan of the Company (the “2021 Shares”). Mr.
As an effort to further diversify our business, in the second quarter of the fiscal year ended June 30, 2018, we developed our bulk cargo container services segment. Bulk cargo container shipment refers to using containers to ship commodities that are traditionally shipped by freight cargo.
In an effort to further diversify our business, in the second quarter of the fiscal year ended June 30, 2018, we developed our bulk cargo container services segment. Bulk cargo container shipment refers to using containers to ship commodities that are traditionally shipped by freight cargo.
On January 9, 2023, the Company entered into an Executive Separation Agreement and General Release (the “Separation Agreement”), with Lei Cao, an employee of the Company and a member of the Board, setting forth the terms and conditions related to (1) the termination of Mr.
On January 9, 2023, the Company entered into an Executive Separation Agreement and General Release (the “Separation Agreement”), with Lei Cao, an employee of the Company and a member of the Board, setting forth the terms and conditions related to the termination of Mr.
The Company has 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.
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.
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.
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.
Hudson lawsuit was consolidated with this lawsuit and Hexin lawsuit; on February 24, 2023, all three consolidated actions were dismissed without prejudice by the court, in furtherance of the parties having reached an agreement in principle to settle their disputes.
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.
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 to Ms. Pan personally. Ms. Pan was suspended by the Board for cause and without pay effective June 20, 2022. On August 31, 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 suspended by the Board for cause and without pay effective June 20, 2022. On August 31, 2022, Ms.
The Settlement Payment and any payments subsequently received by SOSNY from HighSharp shall be deducted from the total amount of $40,560,569 previously paid by, and now due and owing to SOSNY.
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.
The Special Committee has concluded that Mr. Jie was in fact issued a “Red Notice” in China. In terms of remediating this issue, after being suspended by the Special Committee on August 8, 2022, Mr. Yang Jie had resigned from his positions as Chief Executive Officer and as a director of the Company on August 9, 2022.
The Special Committee concluded at that time that Mr. Jie was in fact issued a “Red Notice” in China. In terms of remediating this issue, after being suspended by the Special Committee on August 8, 2022, Mr. Yang Jie resigned from his positions as Chief Executive Officer and as a director of the Company on August 9, 2022.
Jinhe claims monetary damages of “at least $575,000” and “potentially exceeding $1.8 million,” plus interest, costs, and attorneys’ fees. On January 10, 2023, St.
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.
On August 16, 2022, the Staff and attorneys from Blank Rome LLP, counsel for the Special Committee, held a conference call, 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.
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.
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’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. 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.
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”).
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”).
Phi Electric Motor, Inc. had no operations as of the date of this Report. On September 29, 2021, the Company formed a 100% owned subsidiary, SG Shipping & Risk Solution Inc., in New York. On December 23, 2021, SG Shipping & Risk Solution Inc. formed SG Link LLC in New York, of which it is a 100% owner.
Phi Electric Motor, Inc.has had no operations as of the date of this report. On September 29, 2021, the Company formed a 100% owned subsidiary, SG Shipping & Risk Solution Inc., in New York. On December 23, 2021, SG Shipping & Risk Solution Inc. formed a wholly-owned subsidiary, SG Link LLC, in New York.
The Hexin lawsuit claims monetary damages of “at least $6 million,” plus interest, costs, fees, and attorneys’ fees. The St.
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.
The Company has submitted to the Panel a plan to regain compliance with the continued listing requirements and has been 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. Settlement with SOS Information Technology New York, Inc.
The Company submitted to the Panel a plan to regain compliance with the continued listing requirements and 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 January 10, 2020, the Company entered into a cooperation agreement with Mr. Shanming Liang, a stockholder of the Company and set up a joint venture with Mr. Liang in New York named LSM Trading Ltd., in which the Company holds a 40% equity interest. For the year ended June 30, 2022, the Company invested $210,000.
On January 10, 2020, we entered into a cooperation agreement with Mr. Shanming Liang, a stockholder of the Company, to establish a joint venture named LSM Trading Ltd., in which the Company holds a 40% equity interest. For the year ended June 30, 2023, the Company invested $210,000 in the joint venture.
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”).
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”).
Hudson lawsuit claims monetary damages of “at least $4.4 million,” plus interest, costs, fees, and attorneys’ fees. 3 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.
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.
From March to June 2021, the Company engaged in cryptocurrency mining in China. On March 2, 2021, the Company entered into a purchase agreement with Hebei Yanghuai Technology Co., Ltd. (“Yanghuai”) for the purchase of 2,783 digital currency mining machines for a total purchase price of approximately $4.6 million.
On March 2, 2021, the Company entered into a purchase agreement with Hebei Yanghuai Technology Co., Ltd. (“Yanghuai”) for the purchase of 2,783 digital currency mining machines for a total purchase price of RMB 30 million ( approximately $4.6 million).
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.
The Company is not able to estimate the outcome or duration of the government investigations. 10 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 Seller transported digital currency mining machines representing half of the agreed 50,440 terahashes per second (th/s) in computing power (or a total of 25,220 th/s in computing power) to Ningbo, China first, and then shipped to the U.S.
The Seller transported servers representing half of the agreed 50,440 terahashes (one trillion) per second (th/s) in computing power (or a total of 25,220 th/s in computing power) to our Ningbo subsidiary in China and then shipped them to us in the U.S.
Pursuant to the Settlement Agreement, Thor Miner agreed to pay a sum of $13,000,000 (the “Settlement Payment”) to SOSNY in exchange for SOSNY dismissing the lawsuit with prejudice as to the settling Defendants and without prejudice as to all others. The full Settlement Payment was received by SOSNY on December 28, 2022.
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.
Recent Developments Special Committee Investigation On May 5, 2022, an entity named Hindenburg Research issued a report (the “Hindenburg Report”) regarding the Company 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.
We are currently exploring new business opportunities while continuing to provide freight logistics services, which include shipping and warehouse services. 6 Special Committee Investigation On May 5, 2022, an entity named Hindenburg Research issued a report (the “Hindenburg Report”) regarding the Company 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.
(“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 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).
In the fiscal year ended June 30, 2018, we established a wholly owned subsidiary, Ningbo Saimeinuo Supply Chain Management Ltd., which is 100% owned by Sino-Global Shipping New York Inc. (“SG Shipping NY”), a New York corporation and a wholly owned subsidiary of the Company, and primarily engages in transportation management and freight logistics services, including overseas shipping.
(“Ningbo”), which is 100% owned by Sino-Global Shipping New York Inc. (“SG Shipping NY”), a New York corporation and a wholly owned subsidiary of the Company, which primarily engages in transportation management and freight logistics services, including overseas shipping.
On April 10, 2022, the Company entered into a joint venture agreement with Golden Mainland Inc., a Georgia corporation (“Golden Mainland”) to establish a joint venture for building Bitcoin mining sites in Texas, Ohio, and other states. The joint venture has not been set up as of the date of this Report.
On April 10, 2022, the Company entered into a joint venture agreement with Golden Mainland Inc., a Georgia corporation (“Golden Mainland”) to establish a joint venture to build Bitcoin mining sites in Texas, Ohio, and other states. The Company does not plan to pursue this business with Golden Mainland.
Employees As of the date of this Report, we have 39 full-time employees, 13 of whom are based in China and 26 are based in the United States. Of the total full-time employees, nine are in management, 17 are in operations, nine are in finance and accounting related and four are in administration and technical support.
Employees As of the date of this Report, we have 28 full-time employees, 12 of whom are based in China and 16 are based in the United States. Of the total full-time employees, 9 are in management, 10 are in operations, 6 are in finance and accounting related and 3 are in administration and technical support.
Yang Jie tendered his resignation from his positions as the 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.
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.
The Special Committee’s preliminary findings corroborate certain of the allegations made in the Hindenburg Report and the investigation has resulted in the terminations and resignations of certain executive officers and directors of the Company, including but not limited to, the following: On June 16, 2022, Ms.
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.
For the year ended June 30, 2022, SOSNY accounted for 27.9% of the Company’s gross revenue. Our Suppliers Our operations consist of working directly with our customers to understand in detail their needs and expectations and then managing local suppliers to ensure that our customers’ needs are met.
Our Suppliers Our operations consist of working directly with our customers to understand in detail their needs and expectations and then managing local suppliers to ensure that our customers’ needs are met. For the year ended June 30, 2023, two suppliers accounted for approximately 19.6% and 19.5% of our total purchases, respectively.
In January 2016, we expanded our business to include freight logistics services to provide import security filing services with the U.S. Customs and Department of Homeland Security, on behalf of importers who ship goods into the U.S. and also provided inland transportation services to these importers in the U.S.
Customs and Department of Homeland Security, on behalf of importers who ship goods into the U.S. and also provided inland transportation services to these importers in the U.S.
On October 3, 2021, the Company entered into a Strategic Alliance Agreement with HighSharp to establish a joint venture for collaborative engineering, technical development and commercialization of a bitcoin mining machine under the name Thor Miner Inc., granting Thor Miner exclusive rights covering design production, intellectual property, branding, marketing and sales.
Litigation 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.
Over the last two months of the Company’s 2021 fiscal year, national and local governments in China started to restrict and ban cryptocurrency mining operations, causing owners of mining machines to cease mining operations.
The first cash payment of approximately $0.9 million was paid within 15 days after the date of signing the Agreement. Over the last two months of the Company’s 2021 fiscal year, national and local governments in China started to restrict and ban cryptocurrency mining operations, causing owners of mining machines to cease mining operations.
On October 11, 2021, Thor Miner was formed in Delaware, which is 51% owned by the Company and 49% owned by HighSharp. 6 On December 31, 2021, the Company entered into a series of agreements to terminate its variable interest entity (“VIE”) structure and deconsolidated its formerly controlled entity Sino-Global Shipping Agency Ltd. (“Sino-China”).
Thor Miner was given exclusive rights covering design production, intellectual property, branding, marketing and sales. On October 11, 2021, On December 31, 2021, the Company entered into a series of agreements to terminate its variable interest entity (“VIE”) structure and deconsolidated its formerly controlled entity Sino-Global Shipping Agency Ltd. (“Sino-China”).
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 also agreed to cooperate with the Company regarding certain investigations and proceedings and other matters arising out of or related to 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.
After the purchase, Yanghuai would manage and operate the servers at its site with no further charge from March 10, 2021 to March 9, 2022, after which time the Company may engage Yanghuai to continue providing service for a fee. The first cash payment of approximately $0.9 million was paid within 15 days after the date of signing the Agreement.
Yanghuai agreed to manage and operate the servers after the purchase at its site with no further charge from March 10, 2021 to March 9, 2022, after which time the Company could engage Yanghuai to continue providing services for a fee.
The Company recorded impairment for the mining equipment in the last quarter of 2021 in the amount of approximately $0.9 million. the two parties have restructured the Purchase Agreement to reduce the purchase price from RMB 30 million to RMB 6 million and to allocate the purchased mining equipment between the Company and the Seller.
The two parties have restructured the Purchase Agreement to reduce the purchase price from RMB 30 million to RMB 6 million and to allocate the purchased servers between the Company and the Seller.
For loading/discharging agency services, we received the total payment from our customers in U.S. dollars and paid the port charges on behalf of our customers in RMB. For protective agency services, we charged a fixed amount as agent fee while customers were responsible for the payment of port costs and expenses.
In general, we provided two types of shipping agency services: loading/discharging services and protective agency services, in which we acted as a general agent to provide value added solutions to our customers. For loading/discharging agency services, we received the total payment from our customers in U.S. dollars and paid the port charges on behalf of our customers in RMB.
SG Shipping NY held an 80% ownership interest in Blumargo, which was established in partnership with Tianjin Anboweiye Technology Co., to build up hi-tech and information-based logistics services to meet the demand of its customers. On June 30, 2021, SG Shipping NY acquired the additional 20% from Tianjin Anboweiye Technology Co. and increased its ownership to 100%.
(“Tianjin”), to build up hi-tech and information-based logistics services to meet customer demand. On June 30, 2022, SG Shipping NY acquired the 20% interest held from Tianjin and increased its ownership to 100%. From March to June 2021, the Company engaged in cryptocurrency mining in China.
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 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 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.
Based on the amended agreement signed by the Company and Yanghuai on September 17, 2021, the Company is not liable to perform under the remainder of the contract and has title to half of the products.
Based on the amended agreement signed by the Company and Yanghuai on September 17, 2021, the Company is not liable to perform under the remainder of the contract and obtained title to half of the servers. The Company recorded an impairment for the mining equipment in the last quarter of 2021 in the amount of approximately $0.9 million.
In the fiscal year 2022, while we continued to provide our traditional freight business, we expanded our services to include warehousing services provided by our U.S. subsidiary Brilliant Warehouse Service Inc since August 2021.
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 year 2022, while we continued to provide our traditional freight logistics business, we expanded our services to include warehousing services provided by our U.S. subsidiary Brilliant Warehouse Service Inc.
Cao as a result of his cooperation as required by the Company under the terms of the Separation Agreement. Additionally, the Separation Agreement contains mutual general releases and waiver of claims from Mr. Cao and the Company. On February 23, 2023, the Board approved the dissolution of the Special Committee upon conclusion of the committee’s investigation.
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.
(“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 Thor Miner, Inc., which is the Company’s joint venture (“Thor Miner,” together with the Company, referred to as the “Corporate Defendants”), Lei Cao, Yang Jie, John F.
(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.
Our Customers Our main customers for the two fiscal years ended June 30, 2022 and 2021 is Chongqing Iron & Steel Ltd. and SOSNY. For the years ended June 30, 2022 and 2021, Chongqing Iron & Steel Ltd. accounted for 45.6% and 94.4% of the Company’s revenues, respectively.
For the years ended June 30, 2023 and 2022, Chongqing Iron & Steel Ltd. accounted for 52.7% and 45.6% of the Company’s revenues, respectively. For the years ended June 30, 2023 and 2022, SOSNY accounted for 16.1% and 27.9% of the Company’s gross revenue.
Litigations Lawsuits in connection with the 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.
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. 9 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 the same day, John Levy resigned as a director and member of the Audit Committee, Compensation Committee and Nominating Committee of the Board, effective immediately.
John Levy and Heng Wang were appointed as non-executive chairman and vice chairman of the Board, respectively. On February 23, 2023, Mr. Levy resigned as a director and member of the Audit Committee, Compensation Committee and Nominating Committee of the Board, effective immediately. On March 30, 2023, Mr.
The Company has no plan to pursue this business. Our Corporate Structure The diagram below shows our corporate structure as of the date of this Report. * Unless otherwise indicated in the diagram, all the subsidiaries of the Company are wholly owned.
The diagram below shows our corporate structure as of the date of this report. * Unless otherwise indicated in the diagram, all the subsidiaries of the Company are wholly owned. 1 As of June 30, 2023, the Company’s subsidiaries were as follows: Name Background Ownership Sino-Global Shipping New York Inc.
As a result, our business operations have been materially and adversely impacted, including suspension of our business developments in North America. We are currently exploring new business opportunities while continuing to provide freight logistics services, which include shipping and warehouse services.
As a result, our business operations have been materially and adversely impacted, including suspension of our business development in North America.
During 2022, we were engaged in purchases and sales of cryptocurrency mining machines through our U.S. subsidiaries and ceased this line of business in December 2022 following our settlement with SOSNY, as more fully described below under the heading “– Recent Developments – Settlement with SOS Information Technology New York, Inc.” We are currently engaged in providing freight logistics services including warehouse services, which are operated by our subsidiaries Trans Pacific Shipping Limited and Ningbo Saimeinuo Supply Chain Management Ltd in China and Gorgeous Trading Ltd and Brilliant Warehouse Service Inc in the United States.
We are currently engaged in providing freight logistics services including warehouse services, which are operated by our subsidiaries Trans Pacific Shipping Limited and Ningbo Saimeinuo Web Technology Ltd. in China and Gorgeous Trading Ltd. and Brilliant Warehouse Service Inc in the United States.
Since the publication of the Hindenburg Report (as defined below), we have devoted substantial resources and efforts in the cooperation with the investigation of the Special Committee and U.S. governmental authorities, as well as the settlements with investors and vendor and the defense of lawsuits, which are fully described below.
The delisting of our common stock, or the threat of their being delisted, may materially and adversely affect the value of your investment .” Recent Developments Since the publication of the Hindenburg Report (as defined below), we have devoted substantial resources and efforts in connection with the investigations by a special committee of our Board of Directors and by U.S. governmental authorities and with respect to the defense of lawsuits and the settlement of lawsuits and claims, which are fully described below.
Freight cargo rates are usually lower than container freight rates; however, the transit time is much longer and has high minimum quantity requirements. We temporarily suspended this service in the fiscal year ended June 30, 2019 due to market environment factors in 2019, and we have discontinued this service in light of the worldwide impact of the coronavirus pandemic.
Freight cargo rates are usually lower than container freight rates; however, the transit time is much longer and has high minimum quantity requirements.
For the year ended June 30, 2022, two suppliers accounted for approximately 26.3% and 24.1% of our total purchases, respectively.
For the year ended June 30, 2022, two suppliers accounted for approximately 26.3% and 24.1% of our total purchases, respectively. Our Strengths We believe that the following strengths differentiate us from our competitors: ● Proven industry experience and problem-solving reputation . We are a non-asset based global shipping and freight logistics solution provider.
Corporate History and Our Business Segments From inception in 2001 to our fiscal year ended June 30, 2013, our sole business was providing shipping agency services. In general, we provided two types of shipping agency services: loading/discharging services and protective agency services, in which we acted as a general agent to provide value added solutions to our customers.
The Company intends to regain compliance with Nasdaq’s bid price requirement prior to the end of the second bid price extension. Corporate History and Our Business Segments From inception in 2001 to our fiscal year ended June 30, 2013, our sole business was providing shipping agency services.
Item 1. Business. Overview We are a global logistics integrated solution provider that was founded in the United States in 2001. We primarily focus on providing freight logistics services, which mainly include shipping, warehouse, resources, equipment, and other logistical support to steel companies and e-commerce businesses.
Item 1. Business. Overview We are a global logistics integrated solution provider that was founded in the United States in 2001. On September 18, 2007, the Company merged into a new corporation, Sino-Global Shipping America, Ltd. in Virginia.
Our range of services include transportation, warehouse, collection, first-mile delivery, drop shipping, customs clearance, and overseas transit delivery.
Our range of services include transportation, warehouse, collection, last-mile delivery, drop shipping, customs clearance, and overseas transit delivery. As a holding company with no material operations, conduct substantially all of our operations through subsidiaries established in the United States, the People’s Republic of China, or the PRC or China and Hong Kong.
On January 3, 2022, we changed our corporate name to Singularity Future Technology Ltd. to align with our entry into the digital assets business through our U.S. subsidiaries.
On January 3, 2022, the Company changed its corporate name to Singularity Future Technology Ltd. to reflect its expanded operations into the digital assets business. Currently, we primarily focus on providing freight logistics services, which mainly include shipping, warehouse services and other logistical support to steel companies .
For the year ended June 30, 2021, two suppliers accounted for approximately 55.4% and 28.6% of our total purchases, respectively. 7 Our Competition The market segment that we now operate in, which is freight logistics services including warehouse services, does not have high entry barriers.
As a publicly traded company, management may be forced to fulfill near-term performance goals that may not be consistent with the Company’s long-term vision. 17 Our Competition The market segment that we now operate in, which is freight logistics services including warehouse services, does not have high entry barriers.
Removed
We previously focused on providing customized freight logistic services until 2017 when 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.
Added
However, neither the holding company nor any of the Company’s Chinese subsidiaries conduct any operations through contractual arrangements with a variable interest entity based in China. Investors in our common stock should be aware that they may never directly hold equity interests in the PRC operating entities, but rather equity interests solely in Singularity, our Virginia holding company.
Removed
Tuo Pan was terminated for cause as an employee and Chief Financial Officer of the Company and from any other position at any subsidiary of the Company to which she has been appointed in accordance with the terms of her Employment Agreement dated November 9, 2021 and will not receive any salary or benefits from the Company except those earned through August 31, 2022. 1 On August 9, 2022, Mr.
Added
Furthermore, shareholders may face difficulties enforcing their legal rights under United States securities laws against our directors and officers who are located outside of the United States.
Removed
Jie be suspended immediately as the Company’s Chief Executive Officer, pending the Special Committee’s further investigation into allegations raised in the report of Hindenburg Report and other related matters.
Added
(“SGS NY”) ● ● ● A New York Corporation Incorporated on May 03, 2013 Primarily engaged in freight logistics services 100% owned by the Company Sino-Global Shipping HK Ltd. (“SGS HK”) ● ● ● A Hong Kong Corporation Incorporated on September 22, 2008 No material operations 100% owned by the Company Thor Miner Inc.
Removed
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.
Added
(“Thor Miner”) ● ● ● A Delaware Corporation Incorporated on October 13, 2021 Primarily engaged in sales of crypto mining machines 51% owned by the Company Trans Pacific Shipping Ltd. (“Trans Pacific Beijing”) ● ● ● A PRC limited liability company Incorporated on November 13, 2007.
Removed
SOSNY dismissed the lawsuit with prejudice against Singularity (and other Defendants) 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.
Added
Primarily engaged in freight logistics services 100% owned the Company Trans Pacific Logistic Shanghai Ltd. (“Trans Pacific Shanghai”) ● ● ● A PRC limited liability company Incorporated on May 31, 2009 Primarily engaged in freight logistics services 90% owned by Trans Pacific Beijing Ningbo Saimeinuo Web Technology Ltd.
Removed
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.
Added
(“SGS Ningbo”) ● ● ● A PRC limited liability company Incorporated on September 11,2017 Primarily engaged in freight logistics services 100% owned by SGS NY Blumargo IT Solution Ltd.
Removed
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.
Added
(“Blumargo”) ● ● ● A New York Corporation Incorporated on December 14, 2020 No material operations 100% owned by SGS NY Gorgeous Trading Ltd (“Gorgeous Trading”) ● ● ● A Texas Corporation Incorporated on July 01, 2021 Primarily engaged in warehouse related services 100% owned by SGS NY Brilliant Warehouse Service Inc.
Removed
Recent Financings December 2021 Securities Purchase Agreement On December 14, 2021, the Company entered into a securities purchase agreement (the “December 2021 SPA”) with certain non-U.S. investors and accredited investors (the “Investors”) pursuant to which the Company sold to the Investors an aggregate of 3,228,807 shares of common stock and warrants to purchase 4,843,210 shares of common stock.
Added
(“Brilliant Warehouse”) ● ● ● A Texas Corporation Incorporated on April 19,2021 Primarily engaged in warehouse house related services 51% owned by SGS NY Phi Electric Motor In.
Removed
The purchase price for each share of common stock and one and a half warrants is $3.26, and the exercise price per warrant is $4.00. The warrants will be exercisable at any time during the period beginning on or after June 14, 2022 and ending on or prior to 5:00 p.m.

… 162 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

19 edited+15 added−5 removed38 unchanged
Biggest changeOur failure to successfully defend or settle any of these litigations or legal proceedings could result in liability that, to the extent not covered by our insurance, could have an adverse effect on our business, financial condition and results of operations. 8 The scope, determination, and impact of claims, lawsuits, government and regulatory investigations, enforcement actions, disputes, and proceedings to which we are subject cannot be predicted with certainty, and may result in: ● substantial payments to satisfy judgments, fines, or penalties; ● substantial outside counsel, advisor, and consultant fees and costs; ● substantial administrative costs, including arbitration fees; ● loss of productivity and high demands on employee time; ● criminal sanctions or consent decrees; ● termination of certain employees, including members of our executive team; ● barring of certain employees from participating in our business in whole or in part; ● orders that restrict our business or prevent us from offering certain products or services; ● changes to our business model and practices ● delays to planned transactions, service launches or improvements; and ● damage to our brand and reputation.
Biggest changeThe scope, determination, and impact of claims, lawsuits, government and regulatory investigations, enforcement actions, disputes, and proceedings to which we are subject cannot be predicted with certainty, and may result in: ● substantial payments to satisfy judgments, fines, or penalties; ● substantial outside counsel, advisor, and consultant fees and costs; ● substantial administrative costs, including arbitration fees; ● loss of productivity and high demands on employee time; ● criminal sanctions or consent decrees; ● termination of certain employees, including members of our executive team; ● barring of certain employees from participating in our business in whole or in part; ● orders that restrict our business or prevent us from offering certain products or services; ● changes to our business model and practices ● delays to planned transactions, service launches or improvements; and ● damage to our brand and reputation. 19 We are, and may continue to be, subject to securities litigation, which is expensive and could divert management attention, cause harm to our reputation and result in significant damages for which we could be responsible.
GAAP; 10 ● 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 (See Note 1 of the accompanying consolidated financial statement footnotes); ● Lack of proper procedures to maintain supporting documents for accounting record; and ● Lack of proper oversight for the Company’s cash disbursement process that led to misuse of the Company funds by its former executive.
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 (See Note 1 of the accompanying consolidated financial statement footnotes); ● Lack of proper procedures to maintain supporting documents for accounting record; and ● Lack of proper oversight for the Company’s cash disbursement process that led to misuse of the Company funds by its former executive.
Item 1A. Risk Factors. As a smaller reporting company, we are not required to include risk factors in this Report. However, below is a number of material risks, uncertainties and other factors that could have a material effect on the Company and its operations as a result of recent developments.
Item 1A. Risk Factors. As a smaller reporting company, we are not required to include risk factors in this Report. However, below are a number of material risks, uncertainties and other factors that could have a material effect on the Company and its operations as a result of recent developments.
Based on the foregoing evaluation, our Chief Operating Officer concluded that the Company’s disclosure controls and procedures were not effective due to ineffective internal controls over financial reporting that stemmed from the following material weaknesses for the year ended and as of June 30, 2022: ● 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.
Based on the foregoing evaluation, our Chief Operating Officer concluded that the Company’s disclosure controls and procedures were not effective due to ineffective internal controls over financial reporting that stemmed from the following material weaknesses for the year ended and as of June 30, 2023: ● 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.
For additional risks relating to our operations, see the section titled “Risk Factors” contained in our Registration Statement on Form S-3, filed with the SEC on March 3, 2021 and other filings we file with the SEC from time to time.
For additional risks relating to our operations, see the section titled “Risk Factors” contained in our Registration Statement on Form S-3, filed with the SEC on March 3, 2021 and other filings we file with the SEC from time to time. 24
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. 11 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 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. 23 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.
In order to remediate the material weaknesses stated above, we intend to implement the following policies and procedures: ● Hiring additional accounting staff to report the internal financial timely; ● Hiring of CEO and 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.
In order to remediate the material weaknesses stated above, we intend to implement the following policies and procedures: ● Hiring additional accounting staff to report the internal financial timely; ● Reporting other material and non-routine transactions to the Board and obtain proper approval; ● Recruiting additional qualified professionals with appropriate levels of U.S.
The Company has submitted to the Panel a plan to regain compliance with the continued listing requirements and has been 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.Given we did not file all the Reports within the grace period granted by the Panel, we may be delisted from Nasdaq.
The Company has submitted to the Panel a plan to regain compliance with the continued listing requirements and has been 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.
This should be done by CFO and reviewed by CEO upon their communications with the Board; ● Strengthening our 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.
This should be done by CFO and reviewed by CEO upon their communications with the Board; ● Strengthening our 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. 22 We cannot provide assurance that these or other measures will fully remediate our material weaknesses in a timely manner.
There can be also no assurance that our stock price will meet the minimum bid price requirement or we will meet other requirements for continued listing on Nasdaq.
The Company intends to regain compliance with Nasdaq’s bid price requirement prior to the end of the second bid price extension. There can be also no assurance that our stock price will meet the minimum bid price requirement or we will meet other requirements for continued listing on Nasdaq.
For the year ended June 30, 2021, two suppliers accounted for approximately 55.4% and 28.6% of our total purchases, respectively. There can be no assurance that our major suppliers will continue to supply us with the materials or services required to operate our business in the same amount that they have in the past.
There can be no assurance that our major suppliers will continue to supply us with the materials or services required to operate our business in the same amount that they have in the past.
Our common stock is currently listed on The Nasdaq Capital Market (“Nasdaq”). To maintain this listing, we must satisfy minimum financial and other requirements.
Our ability to maintain compliance with Nasdaq continued listing requirements, including whether we are able to maintain the closing bid price of our common stock, could result in the delisting of our common stock. Our common stock is currently listed on The Nasdaq Capital Market (“Nasdaq”). To maintain this listing, we must satisfy minimum financial and other requirements.
Additionally, given the high concentration of our customer base, a default by or a significant reduction in future transactions with our major customer could materially reduce our revenues, profitability, liquidity and growth prospects.
Additionally, given the high concentration of our customer base, a default by or a significant reduction in future transactions with our major customer could materially reduce our revenues, profitability, liquidity and growth prospects. 20 We depend on a limited number of suppliers who are able to exert a high degree of influence over us and the loss of our major suppliers could adversely impact our business.
The loss of our major customer or a material reduction in sales to a major customer could have a material adverse effect on our sales and results of operations.
There can be no assurance that our major customer will continue to purchase our services in the same amount that it has in the past. The loss of our major customer or a material reduction in sales to a major customer could have a material adverse effect on our sales and results of operations.
We depend on a limited number of suppliers who are able to exert a high degree of influence over us and the loss of our major suppliers could adversely impact our business. For the year ended June 30, 2022, two suppliers accounted for approximately 26.3% and 24.1% of our total purchases, respectively.
We depend on a limited number of major customers who are able to exert a high degree of influence over us and the loss of a major customer could adversely impact our business. For the years ended June 30, 2023 and 2022, one customer, Chongqing Iron & Steel Ltd., accounted for 52.7%and 60.8% of our revenues, respectively.
We cannot provide assurance that these or other measures will fully remediate our material weaknesses in a timely manner. If our remediation of these material weaknesses is not effective, it may cause our Company to become subject to investigation or sanctions by the SEC.
If our remediation of these material weaknesses is not effective, it may cause our Company to become subject to investigation or sanctions by the SEC. It may also adversely affect investor confidence in our Company and, as a result, the value of our common stock.
As discussed in “Item 9.A Controls and Procedures – Disclosure Controls and Procedures,” under the supervision and with the participation of our management, we conducted an assessment of the effectiveness of our disclosure controls and procedures as of June 30, 2022.
This deficiency could result in additional misstatements to its consolidated financial statements that would be material and would not be prevented or detected on a timely basis. 21 As discussed in “Item 9.A Controls and Procedures – Disclosure Controls and Procedures,” under the supervision and with the participation of our management, we conducted an assessment of the effectiveness of our disclosure controls and procedures as of June 30, 2023.
If these expenditures are significant or involve issues which result in significant liability for our key personnel, we may be unable to continue operating as a going concern. 9 We depend on a limited number of major customers who are able to exert a high degree of influence over us and the loss of a major customer could adversely impact our business.
This indemnification policy could result in substantial expenditures, which we may be unable to recoup. If these expenditures are significant or involve issues which result in significant liability for our key personnel, we may be unable to continue operating as a going concern.
It may also adversely affect investor confidence in our Company and, as a result, the value of our common stock. There can be no assurance that all existing material weaknesses have been identified, or that additional material weaknesses will not be identified in the future.
There can be no assurance that all existing material weaknesses have been identified, or that additional material weaknesses will not be identified in the future. In addition, if we are unable to continue to meet our financial reporting obligations, we may not be able to remain listed on Nasdaq.
Removed
We are, and may continue to be, subject to securities litigation, which is expensive and could divert management attention, cause harm to our reputation and result in significant damages for which we could be responsible.
Added
Our failure to successfully defend or settle any of these litigations or legal proceedings could result in liability that, to the extent not covered by our insurance, could have an adverse effect on our business, financial condition and results of operations.
Removed
This indemnification policy could result in substantial expenditures, which we may be unable to recoup.
Added
For the year ended June 30, 2023, two suppliers accounted for approximately 19.6% and 19.5% of our total purchases, respectively. For the year ended June 30, 2022, two suppliers accounted for approximately 26.3% and 24.1% of our total purchases, respectively.
Removed
For the years ended June 30, 2022 and 2021, one customer, Chongqing Iron & Steel Ltd., accounted for 60.8% and 89.7% of our revenues, respectively. There can be no assurance that our major customer will continue to purchase our services in the same amount that it has in the past.
Added
On March 8, 2023, the Company received a notice from Nasdaq Listing Qualifications department of Nasdaq 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.
Removed
This deficiency could result in additional misstatements to its consolidated financial statements that would be material and would not be prevented or detected on a timely basis.
Added
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.
Removed
In addition, if we are unable to continue to meet our financial reporting obligations, we may not be able to remain listed on Nasdaq. Our ability to maintain compliance with Nasdaq continued listing requirements, including whether we are able to maintain the closing bid price of our common stock, could result in the delisting of our common stock.
Added
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 Securities and Exchange Commission, and that the matter is now closed.
Added
On July 7, 2023, the Company received an 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).
Added
The Letter also states that the Company has 45 calendar days to submit a plan to regain compliance (the “Plan”) 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.
Added
Nasdaq requires the Plan to be submitted no later than August 21, 2023.
Added
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 Tieliang Liu from the Company’s board of directors and audit committee effective July 3, 2023.
Added
Nasdaq advised the Company that in accordance with Nasdaq’s Listing Rule 5605(c)(4), the Company has a cure period to 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.
Added
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. Tieliang Liu. The Board appointed Mr.
Added
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.
Added
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.
Added
However, Nasdaq has determined that the Company is eligible for an additional 180 calendar day period, or until January 2, 2024, to regain compliance.
Added
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.

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed0 unchanged
Biggest changeOffice Address Rental Term Space New York, USA 98 Cutter Mill Rd Suite 322 Great Neck, New York 11021 Expires 07/31/2026 3,033 ft 2 Texas, USA 6161 Savoy Dr Suite 409 Houston, Texas 77036 Expires 07/31/2023 2,456 ft 2 Texas, USA 6161 Savoy Dr, Suite 1040 Houston, Texas 77036 Expires 06/30/2024 954 ft 2 Texas, USA 12733 Stafford Road, Suite 400 Stafford, Texas 77477 Expires 07/31/2024 46,463 ft 2 Shanghai, PRC Rm 12D & 12E, No.359 Dongdaming Road, Hongkou District, Shanghai, PRC 200080 Expires 12/31/2023 3,078 ft 2 Ningbo, PRC B 525 Hebang Building, North Tiantong Road Ningbo, Zhejiang, PRC 315000 Expires 07/06/2025 840 ft 2
Biggest changeOffice Address Rental Term Space New York, USA 98 Cutter Mill Rd Suite 322 Great Neck, New York 11021 Expires 07/31/2026 3,033 ft 2 Texas, USA 6161 Savoy Dr, Suite 1040 Houston, Texas 77036 Expires 06/30/2024 954 ft 2 Texas, USA 12733 Stafford Road, Suite 400 Stafford, Texas 77477 Expires 07/31/2024 46,463 ft 2 Shanghai, PRC Rm 12D & 12E, No.359 Dongdaming Road, Hongkou District, Shanghai, PRC 200080 Expires 12/31/2023 3,078 ft 2
Item 2. Properties. We currently rent six facilities in the PRC and the United States. Our PRC headquarters is in Shanghai and our U.S. headquarters is in New York.
Item 2. Properties. We currently rent five facilities in the PRC and the United States. Our PRC headquarters is in Shanghai and our U.S. headquarters is in New York.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed0 unchanged
Biggest changeItem 3. Legal Proceedings. See “Item 1. Business – Recent Developments” for a description of legal proceedings the Company is currently involved in, which is incorporated herein by reference. Item 4. Mine Safety Disclosures. This item is not applicable to the Company. 12 PART II
Biggest changeItem 3. Legal Proceedings. See “Item 1. Business – Recent Developments” for a description of legal proceedings the Company is currently involved in, which is incorporated herein by reference. Item 4. Mine Safety Disclosures. This item is not applicable to the Company. 25 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

1 edited+0 added−0 removed3 unchanged
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market for Our Common Stock Our common stock is traded on the Nasdaq Capital Market under the symbol SGLY. Holders of Our Common Stock As of March 3, 2023, there were 20 holders of record of our common stock.
Biggest changeItem 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market for Our Common Stock Our common stock is traded on the Nasdaq Capital Market under the symbol SGLY. Holders of Our Common Stock As of September 25, 2023, there were 8 holders of record of our common stock.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

54 edited+18 added−28 removed8 unchanged
Biggest changeThe following tables present summary information by segments for the years ended June 30, 2022 and 2021: For the Year Ended June 30, 2022 Shipping Agency and Management Services Freight Logistics Services Sales of Crypto Mining Machines Total Net revenues* $ - $ 3,830,615 $ 157,800 $ 3,988,415 Cost of revenues $ - $ 4,136,474 $ - $ 4,136,474 Gross profit $ - $ (305,859 ) $ 157,800 $ (148,059 ) Depreciation and amortization $ - $ 512,586 $ 21,052 $ 533,638 Total capital expenditures $ - $ 840,319 $ 34,199 $ 874,518 Gross margin - % (8.0 )% 100.0 % (3.7 )% * Including related party revenue of $222,963 from Zhejiang Jinbang Fuel Energy Co., Ltd for the year ended June 30, 2022. 16 For the Year Ended June 30, 2021 Shipping Agency and Management Services Freight Logistics Services Sales of Crypto Mining Machines Total Net revenues $ 206,845 $ 4,944,187 $ - $ 5,151,032 Cost of revenues $ 176,968 $ 4,797,427 $ - $ 4,974,394 Gross profit $ 29,878 $ 146,760 $ - $ 176,638 Depreciation and amortization $ 299,934 $ 36,300 $ - $ 336,234 Total capital expenditures $ 136,076 $ 407,954 $ - $ 554,030 Gross margin 14.4 % 3.0 - % 3.4 % % Changes For the Years Ended June 30, 2022 and 2021 Shipping Agency and Management Services Freight Logistics Services Sales of Crypto Mining Machines Total Net revenues (100.0 )% (22.5 )% - (22.6 )% Cost of revenues (100.0 )% (13.8 )% - (16.8 )% Gross profit (100.0 )% (308.4 )% - (183.8 )% Depreciation and amortization (100.0 )% 1312.1 % - 58.7 % Total capital expenditures (100.0 )% 106.0 % 100.0 % 57.8 % Gross margin (14.4 )% (11.0 )% 100.0 % (7.1 )% Disaggregated information of revenues by geographic locations are as follows: For the Years Ended June 30, June 30, 2022 2021 PRC 2,982,691 4,921,022 U.S. 1,005,724 230,010 Total revenues $ 3,988,415 $ 5,151,032 Revenues Shipping Agency and Management Services For the years ended June 30, 2022 and 2021, we did not generate any revenue from shipping agency and management services as we did not receive any new orders for our services due to the uncertainty of the shipping management market which was negatively impacted by the COVID-19 pandemic.
Biggest changeFor the Year Ended June 30, 2022 Freight Logistics Services Sales of Crypto Mining Machines Total Net revenues $ 3,830,615 $ 157,800 $ 3,988,415 Cost of revenues $ 4,136,474 $ - $ 4,136,474 Gross profit $ (305,859 ) $ 157,800 $ (148,059 ) Depreciation and amortization $ 512,586 $ 21,052 $ 533,638 Total capital expenditures $ 840,319 $ 34,199 $ 874,518 Gross margin (8.0 )% 100.0 % (3.7 )% % Changes For the Years Ended June 30, 2023 and 2022 Freight Logistics Services Sales of Crypto Mining Machines Total Net revenues (0.6 )% 364.2 % 13.8 % Cost of revenues (3.5 )% 100 % (3.5 )% Gross profit (39.7 )% 364.2 % (470.2 )% Depreciation and amortization (68.1 )% (96.6 )% (69.2 )% Total capital expenditures (104.6 )% (91.7 )% (104.1 )% Gross margin 3.2 % 0 % 15.8 % 28 Disaggregated information of revenues by geographic locations are as follows: For the Years Ended June 30, June 30, 2023 2022 PRC 2,529,449 2,982,691 U.S. 2,009,274 1,005,724 Total revenues $ 4,538,723 $ 3,988,415 Revenues Freight Logistics Services Freight logistics services primarily consist of cargo forwarding, brokerage, warehouse and other freight services.
Financing Activities Net cash provided by financing activities was approximately $8.3 million for the year ended June 30, 2022 due to issuances of common stock in private placements of approximately $10.5 million and proceeds from convertible notes of $10 million, repayment of convertible notes of $5.0 million and warrant repurchase of approximately $7.9 million.
Net cash provided by financing activities was approximately $8.3 million for the year ended June 30, 2022 due to issuances of common stock in private placements of approximately $10.5 million and proceeds from convertible notes of $10 million, repayment of convertible notes of $5.0 million and warrant repurchase of approximately $7.9 million.
On December 23, 2022, the Company entered into the Settlement Agreement with SOSNY pursuant to which the Company paid $13.0 million to SOSNY in exchange for SOSNY dismissing the lawsuit and will transfer any additional funds it receives from HighSharp to SOSNY in an amount not to exceed $40,560,569.
On December 23, 2022, the Company entered into the Settlement Agreement with SOSNY pursuant to which the Company paid $13.0 million to SOSNY in exchange for SOSNY dismissing the lawsuit and agreed to transfer any additional funds it receives from HighSharp to SOSNY in an amount not to exceed $40,560,569.
The operating cash outflow for the year ended June 30, 2022 was primarily attributable to our net loss of approximately $28.9 million, adjusted by non-cash stock-based compensation of approximately $10.0 million, loss on disposal of subsidiaries and VIE of approximately $6.1 million and provision for doubtful accounts of approximately $1.6 million.
The operating cash inflow for the year ended June 30, 2022 was primarily attributable to our net loss of approximately $28.9 million, adjusted by non-cash stock-based compensation of approximately $10.0 million, loss on disposal of subsidiaries and VIE of approximately $6.1 million and provision for doubtful accounts of approximately $1.6 million.
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 logistics business, we expanded our services to include warehousing services provided by our US subsidiary Brilliant Warehouse Service Inc.
These opportunities ranged from complementary businesses to other new service and product initiatives. In the fiscal years 2022 and 2023, while we continued to provide our freight logistics business, we expanded our services to include warehousing services provided by our US subsidiary Brilliant Warehouse Service Inc.
For the fiscal year ended June 30, 2022, we operated in two operating segments, including (1) freight logistics services, through our subsidiaries in the U.S and PRC; and (2) purchase and sales of crypto mining machines, through our subsidiary Thor Miner.
For the fiscal year ended June 30, 2023 and 2022, we operated in two operating segments: (1) freight logistics services, through our subsidiaries in the U.S and PRC; and (2) the purchase and sales of crypto mining machines, through our subsidiary Thor Miner.
Management considers new evidence, both positive and negative, that could affect our future realization of deferred tax assets, including our recent cumulative earnings experience, expectations of future income, the carry forward periods available for tax reporting purposes and other relevant factors.
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.
The impacts of COVID-19 on our business, financial condition, and results of operations include, but are not limited to, the following: ● Our customers have been negatively impacted by the pandemic, which reduced their demand for freight logistics services.
The impact of COVID-19 on our business, financial condition, and results of operations include, but are not limited to, the following: ● Our customers have been negatively impacted by the pandemic, which reduced their demand for freight logistics services.
We had an increase in cash inflow of other receivables of approximately $1.4 million and we received a total of $47.0 million from SOSNY, approximately $34.1 million was advanced payment for the sale of cryptocurrency mining machines while we are to refund SOSNY $13.0 million in December 2022.
We had an increase in cash inflow of other receivables of approximately $1.4 million and we received a total of $47.0 million from SOSNY, approximately $34.1 million was an advanced payment we received for the sale of cryptocurrency mining machines, while we refunded $13.0 million to SOSNY in December 2022.
As a result, our revenue for the year ended June 30, 2022 was down by approximately $1.2 million, or 22.6%. ● Due to travel restrictions between US and China, our new business development for existing segments or new ventures has been slowed down. ● Our sales of crypto mining machines were materially adversely affected by COVID-19.
As a result, our revenue for the year ended June 30, 2022 was down by approximately $1.2 million, or 22.6% and our freight revenue declined slightly in the year ended June 30, 2023. ● Due to travel restrictions between US and China, our new business development for existing segments or new ventures has been slowed down. ● Our sales of crypto mining machines were materially adversely affected by COVID-19.
We determined that it is more likely than not that our deferred tax assets would not be realized due to uncertainty for future earnings due to the Company’s reorganization and venture into new businesses. We provided a 100% allowance for deferred tax assets as of June 30, 2022.
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 June 30, 2023.
Business – Recent Developments.” 13 On January 10, 2022, Thor Miner entered into a purchase agreement with HighSharp. Pursuant to the agreement, Thor Miner agreed to purchase certain cryptocurrency mining equipment from HighSharp. In January and April 2022, Thor Miner made a total prepayment of $35,406,649 for the order.
Business – Recent Developments.” On January 10, 2022, Thor Miner entered into a purchase agreement with HighSharp. Pursuant to the agreement, Thor Miner agreed to purchase certain cryptocurrency mining equipment from HighSharp. In January and April 2022, Thor Miner prepaid $35,406,649 for the order.
Note 2, “Summary of Significant Accounting Policies” of the notes to the financial statements included elsewhere in this Report 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 date of this Report. Off-Balance Sheet Arrangements None. Item 7A.
Note 2, “Summary of Significant Accounting Policies” of the notes to the financial statements included elsewhere in this Report 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 date of this Report.
Our cash inflow was decreased by an advance to a related party supplier of approximately $34.1 million which was for the purchase of cryptocurrency mining machines. Our net cash used in operating activities was approximately $8.7 million for the year ended June 30, 2021.
Our cash inflow was decreased by an advance to a related party supplier of approximately $34.1 million which was for the purchase of cryptocurrency mining machines. Investing Activities Net cash used in investing activities was approximately $2.2 million for the year ended June 30, 2023.
The net decrease in valuation for the year ended June 30, 2022 amounted to approximately $1.0 million based on management’s reassessment of the amount of our deferred tax assets that are more likely than not to be realized.
The net decrease in valuation for the year ended June 30, 2023 amounted to approximately $4,696,000 based on management’s reassessment of the amount of our deferred tax assets that are more likely than not to be realized.
We also made related party advances of approximately $1.9 million, which includes $1.3 million to Shanghai Baoyin which is 30% owned by Wang Qinggang, and approximately $0.6 million in advances to LSM Trading Ltd, of which we hold a 40% ownership interest.
We also made related party advances of approximately $1.9 million, which includes $1.3 million to Shanghai Baoyin which is 30% owned by Wang Qinggang, and approximately $0.6 million in advances to LSM Trading Ltd, of which we hold a 40% ownership interest. The outstanding personal loan owed by Wang Qinggang was fully repaid in December 2022.
We believe our current working capital is sufficient to support our operations and debt obligations as they become due within one year from the date of this Report. Operating Activities Our net cash provided by operating activities was approximately $5.9 million for the year ended June 30, 2022.
We believe our current working capital is sufficient to support our operations and debt obligations as they become due within one year from the date of this Report. 32 Operating Activities Our net cash used in operating activities was approximately $33.6 million for the year ended June 30, 2023.
Any future impact of COVID-19 on the Company’s China operation results will depend on, to a large extent, future developments and new information that may emerge regarding the duration and resurgence of COVID-19 variants and the actions taken by government authorities to contain COVID-19 or treat its impact, almost all of which are beyond our control.
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.
Any future impact of COVID-19 on the Company’s operation results will depend on, to a large extent, future developments and new information that may emerge regarding the duration and resurgence of COVID-19 variants and the actions taken by government authorities to contain COVID-19 or treat its impact, almost all of which are beyond our control.
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.
Taxes Our income tax expenses amounted to nil and $3,450 for the years ended June 30, 2022 and 2021, respectively. We have incurred a cumulative U.S. federal net operating loss (“NOL”) of approximately $12,543,000 as of June 30, 2021, which may reduce future federal taxable income.
Taxes Our income tax expenses amounted to $135,855 and nil for the years ended June 30, 2023 and 2022, respectively. We have incurred a cumulative U.S. federal net operating loss (“NOL”) of approximately $22,000,000 as of June 30, 2022, which may reduce future federal taxable income. The NOL generated for the year ended June 30, 2023 amounted to approximately $19,700,000.
The total loss of three disposals amounted to approximately $6.1 million. Since these entities did not have any active operations prior to their disposal, the disposal did not represent a strategic change in the Company’s business. As such, the disposal was not presented as a discontinued operation.
Since these entities did not have any active operations prior to their disposal, the disposal did not represent a strategic change in the Company’s business. As such, the disposal was not presented as a discontinued operation.
Cost of revenues for our freight logistics services segment was $4,136,474 for the year ended June 30, 2022, a decrease of $660,953, or approximately 13.8%, as compared to $4,797,427 for the year ended June 30, 2021 as a result of the decrease in freight costs of our PRC operations caused by the decrease in shipping volume due to the pandemic.
Cost of revenues for our freight logistics services segment was $3,990,654 for the year ended June 30, 2023, a decrease of $145,820, or approximately 3.5%, as compared to $4,136,474 for the year ended June 30, 2022 as a result of the decrease in freight costs of our PRC operations caused by the decrease in shipping volume due to the pandemic.
Net Loss As a result of the foregoing, we had a net loss of $28,928,369 for the year ended June 30, 2022, compared to $11,302,853 for the year ended June 30, 2021.
Net Loss As a result of the foregoing, we had a net loss of $23,098,342 for the year ended June 30, 2023, compared to a net loss of $28,928,369 for the year ended June 30, 2022.
Our liquidity needs are to meet our working capital requirements, operating expenses and capital expenditure obligations. As of June 30, 2022, our working capital was approximately $38.0 million and we had cash of approximately $55.8 million.
Our liquidity needs are to meet our working capital requirements, operating expenses and capital expenditure obligations. As of June 30, 2023, our working capital was approximately $13.2 million and we had cash of approximately $17.4 million.
Investing Activities Net cash used in investing activities was approximately $3.5 million for the year ended June 30, 2022 due to the acquisition of property and equipment of approximately $0.9 million and an investment of approximately $0.2 million to a 40% owned joint venture.
We also had cash inflows from repayment of a loan receivable of approximately $0.5 million from Qinggang Wang and Lei Cao, who are related parties, and $0.09 million from the sale of property and equipment, and repayments from related parties of approximately $0.3 million, Net cash used in investing activities was approximately $3.5 million for the year ended June 30, 2022 due to the acquisition of property and equipment of approximately $0.9 million and an investment of approximately $0.2 million to a 40% owned joint venture.
After the deduction of non-controlling interest, net loss attributable to us was $28,257,830 for the year ended June 30, 2022, compared to $10,900,168 for the same period in 2021. Comprehensive loss attributable to us was $27,482,995 for the year ended June 30, 2022, as compared to $10,545,234 for the year ended June 30, 2021.
After the deduction of non-controlling interest, net loss attributable to us was $22,996,846 for the year ended June 30, 2023, compared to $28,257,830 for the same period in 2022.
In early December 2022, Chinese government eased the strict control measure for COVID-19, which has led to surge in increased infections and disruption in our business operations.
In early December 2022, Chinese government eased the strict control measures for COVID-19, which led to a surge in increased infections and disruption to our business operations. In 2023, our China operation continued to suffer from the impact of COVID-19, although to a lesser extent.
We recognized the sales of cryptocurrency mining equipment based on a net basis as the manufacturer of the products is responsible for shipping and custom clearing for the products. Gross revenue and the gross cost of revenue amounted to $1,483,320 and $1,325,520, respectively, for the year ended June 30, 2022.
We recognized the sales of cryptocurrency mining equipment based on a net basis as the manufacturer of the products was responsible for shipping and custom clearing for the products. The net revenue amounted to $732,565 and $157,800, respectively, for the years ended June 30, 2023 and 2022. We ceased to sell crypto-mining equipment since January 1, 2023.
Selling Expenses Our selling expenses consisted primarily of salaries and travel expenses for our sales representatives. For the year ended June 30, 2022, we had $385,890 in selling expenses, as compared to $297,906 for the year ended June 30, 2021, which represents an increase of $87,984 or approximately 29.5%.
Selling Expenses Our selling expenses consisted primarily of salaries, meals and entertainment and travel expenses for our sales representatives. For the year ended June 30, 2023, we had $232,569 in selling expenses, as compared to $385,890 for the year ended June 30, 2022, which represents a decrease of $153,321 or approximately 39.7%.
The increase was due to an increase of marketing expenses of approximately $0.2 million to promote our freight logistics business. 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 for auditing, legal and IT consulting.
The decrease was mainly due to a decrease in marketing expenses for our freight logistics segment in the PRC compared to the year ended June 30, 2022. 29 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 for auditing, legal and IT consulting.
For the year ended June 30, 2022, we had $9,301,784 general and administrative expenses, as compared to $5,605,670 for the year ended June 30, 2021, representing an increase of $3,696,114, or approximately 65.9%.
For the year ended June 30, 2023, we had $11,572,888 of general and administrative expenses, as compared to $9,301,784 for the year ended June 30, 2022, representing an increase of $2,271,104, or approximately 24.4%.
As of December 22, 2022, the balance of advance to HighSharp and deposit from SOSNY amounted to $27,927,583 and $40,560,569, respectively. Thor Miner paid $13.0 million on December 28, 2022 to SOSNY and wrote off the balance of the deposit it received from SOSNY and the balance of its payment to HighSharp.
As of December 22, 2022, the balance of the advance made to HighSharp and deposit from SOSNY amounted to $27,927,583 and $40,560,569, respectively.
Assumptions used in a DCF analysis require the exercise of significant judgment, including judgment about appropriate discount rates and terminal values, growth rates, and the amount and timing of expected future cash flows.
Assumptions used in a DCF analysis require the exercise of significant judgment, including judgment about appropriate discount rates and terminal values, growth rates, and the amount and timing of expected future cash flows. Impairment Loss of Investment The Company recorded $128,369 for the year ended June 30, 2023 due to the impairment of the Company’s investment in LSM Trading Ltd.
During the year ended June 30, 2022, approximately $9,700,000 of NOL was generated and the tax benefit derived from such NOL was approximately 2,000,000. Our operations in China incurred a cumulative a cumulative NOL of approximately $6,026,000 as of June 30, 2021, which was mainly from Sino-China which we disposed of during the year ended June 30, 2022.
The Tax benefit derived from this NOL was approximately $8,775,000. As of June 30, 2023, our cumulative NOL amounted to approximately $41,700,000. 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 in the year ended June 30, 2022.
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. The Company also dissolved its subsidiary Sino-Global Shipping LA, Inc., and on March 14, 2022, the Company discontinued its subsidiary Sino-Global Shipping Canada, Inc.
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 VIE structures.
As of June 30, 2022, we had the following loans outstanding: Loans Maturities Interest rate June 30, 2022 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 Years Ended June 30, 2022 2021 Net cash provided by (used in) operating activities $ 5,918,070 $ (8,679,918 ) Net cash used in investing activities $ (3,581,676 ) $ (1,510,379 ) Net cash provided by financing activities $ 8,351,964 $ 54,200,082 Effect of exchange rate fluctuations on cash $ 307,607 $ 696,350 Net increase in cash $ 10,995,965 $ 44,706,135 Cash at the beginning of period $ 44,837,317 $ 131,182 Cash at the end of period $ 55,833,282 $ 44,837,317 The following table sets forth a summary of our working capital: June 30, June 30, 2022 2021 Variation % Total Current Assets $ 63,165,462 $ 46,867,350 $ 16,298,112 34.8 % Total Current Liabilities $ 25,212,959 $ 5,343,649 $ 19,869,310 371.8 % Working Capital $ 37,952,503 $ 41,523,701 $ (3,571,198 ) (8.6 )% Current Ratio 2.51 8.77 (6.26 ) (71.4 )% 20 In assessing the liquidity, we monitor and analyze our cash on-hand and our operating and capital expenditure commitments.
As of June 30, 2023, we had the following loan outstanding: Loans Maturity Interest rate Amount 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 Years Ended June 30, 2023 2022 Net cash (used in) provided by operating activities $ (33,643,405 ) $ 5,918,070 Net cash used in investing activities $ (2,225,708 ) $ (3,581,676 ) Net cash (used in) provided by financing activities $ (2,125,420 ) $ 8,351,964 Effect of exchange rate fluctuations on cash $ (448,593 ) $ 307,607 Net (decrease) increase in cash $ (38,443,126 ) $ 10,995,965 Cash at the beginning of period $ 55,833,282 $ 44,837,317 Cash at the end of period $ 17,390,156 $ 55,833,282 The following table sets forth a summary of our working capital: June 30, June 30, 2023 2022 Variation % Total Current Assets $ 18,192,716 $ 63,165,462 $ (44,972,746 ) (71 )% Total Current Liabilities $ 5,031,769 $ 25,212,959 $ (20,181,190 ) (80 )% Working Capital $ 13,160,947 $ 37,952,503 $ (24,791,556 ) (65 )% Current Ratio 3.62 2.51 1.11 44 % In assessing the liquidity, we monitor and analyze our cash on-hand and our operating and capital expenditure commitments.
As of June 30, 2022, our PRC subsidiaries’ cumulative NOL amounted to approximately $1,283,000 which may reduce future taxable income and will expire by 2026. 19 We periodically evaluate the likelihood of the realization of deferred tax assets and reduce the carrying amount of the deferred tax assets by a valuation allowance to the extent we believe a portion will not be realized.
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.
Thor Miner also entered into a PSA with SOSNY for the purchase of $200,000,000 in crypto mining rigs and received deposit form SOSNY in the amount of $48,930,000.
Thor Miner also entered into a PSA with SOSNY for the purchase of $200,000,000 in crypto mining rigs and received a deposit form SOSNY in the amount of $48,930,000. 26 Due to HighSharp’s production issue, Thor Miner was unable to timely deliver the products to SOSNY according to the delivery terms of the PSA and was sued by SOSNY for breach of contract on December 9, 2022. .
Pursuant to the PSA, Thor Miner agreed to sell to SOSNY certain cryptocurrency mining hardware and other equipment. The total purchase price was $200,000,000 and the purchase was expected to be completed under separate purchase orders. Thor Miner made two shipments in June 2022 and we recognized net revenue of $157,800.
Sales of Crypto Mining Machines On January 10, 2022, Thor Miner entered into the PSA with SOSNY, a wholly owned subsidiary of SOS Ltd. Pursuant to the PSA, Thor Miner agreed to sell to SOSNY certain cryptocurrency mining hardware and other equipment. The total purchase price was $200,000,000 and the purchase was expected to be completed under separate purchase orders.
On December 19, 2021, the Company issued two convertible notes to two non-U.S. investors for an aggregate purchase price of $10,000,000 (the “December 2021 Convertible Notes”). The December 2021 Convertible Notes bear interest at 5% annually and may be converted into shares of the Company’s common stock at a conversion price of $3.76 per share.
The December 2021 Convertible Notes bear interest at 5% annually and may be converted into shares of the Company’s common stock at a conversion price of $3.76 per share. At the investors’ request, we prepaid $5,000,000 in the aggregate principal amount, without interest, of the December 2021 Convertible Notes on March 8, 2022.
Quantitative and Qualitative Disclosures about Market Risk. Not applicable.
Off-Balance Sheet Arrangements None. 33 Item 7A. Quantitative and Qualitative Disclosures about Market Risk. Not applicable.
Operating Costs and Expenses Operating costs and expenses increased by $10,737,621 or approximately 67.4% from $26,679,459 for the year ended June 30, 2022 compared to $15,941,838 for the year ended June 30, 2021. This increase was mainly due to the increase in selling expenses, stock-based compensation, general and administrative expenses and impairment expenses as more fully discussed below.
Operating Costs and Expenses Operating costs and expenses decreased by $ 7,545,942 or approximately 28.3% from $19,133,517 for the year ended June 30, 2023 compared to $26,679,459 for the year ended June 30, 2022. This decrease was mainly due to the decrease in stock-based compensation, impairment loss of fixed assets and right of use assets as more fully discussed below.
Other Expenses, Net Other expenses, net for the year ended June 30, 2022 mainly consists of interest expenses for our convertible debts of approximately $0.1 million and other finance charges, net of interest earned.
Other Expenses, Net Other expenses, net was $0.07 million for the year ended June 30, 2023, which mainly consisted of interest expense for our convertible debt of approximately $0.25 million and the gain on disposal of right of use assets and fixed assets of $0.19 million, compared to $0.1 million of interest expenses for our convertible debt and other finance charges, net of interest earned in the year ended June 30, 2022.
Impairment Loss of Cryptocurrencies We recorded $170,880 in impairment loss for the year ended June 30, 2022 due to a recent price drop in bitcoin, which the Company deemed a triggering event for impairment testing. 18 Impairment Loss of Fixed Assets and Right of Use Assets We performed our annual goodwill impairment analysis as of June 30, 2022 and concluded we had approximately $1.0 million in impairment loss for fixed assets and right of use assets, as our carrying value exceeds the fair value.
We performed our annual goodwill impairment analysis as of June 30, 2023 and concluded we had approximately an $0.03 million impairment loss for fixed assets and right of use assets, as our carrying value exceeds the fair value.
Net cash provided by financing activities was approximately $54.2 million for the year ended June 30, 2021 due to cash proceeds received from issuances of common stock to private investors of approximately $52.8 million and cash proceeds received from issuances of preferred stock to a private investor of approximately $1.4 million. 21 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.
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.
Results of Operations Comparison of the Years Ended June 30, 2022 and 2021 The following table sets forth the results of our operations for the periods indicated: For the Years Ended June 30, 2022 2021(restated) Change US $ % US $ % US $ % Revenues 3,988,415 100.0 % 5,151,032 100.0 % （1,162,617 ） (22.6 )% Cost of revenues 4,136,474 103.7 % 4,974,394 96.6 % (837,920 ) (16.8 )% Gross margin (3.7 )% N/A 3.4 % N/A (7.1 )% N/A Selling expenses 385,890 9.7 % 297,906 5.8 % 87,984 29.5 % General and administrative expenses 9,301,784 233.2 % 5,605,670 108.8 % 3,696,114 65.9 % Impairment loss of Cryptocurrencies 170,880 4.3 % - 0.0 % 170,880 100.0 % Impairment loss of fixed assets and right of use asset 1,006,305 25.2 % 855,230 16.6 % 151,075 17.7 % Provision for doubtful accounts, net of recovery 1,613,504 40.5 % 4,208,638 81.7 % (2,595,134 ) (61.7 )% Stock-based compensation 10,064,622 252.3 % - 0.0 % 10,064,622 100.0 % Total costs and expenses 26,679,459 668.9 % 15,941,838 309.5 % 10,737,621 67.4 % Revenues Revenues decreased by $1,162,617, or approximately 22.6%, to $3,988,415 for the year ended June 30, 2022 from $5,151,032 for the year ended June 30, 2021.
Results of Operations Comparison of the Years Ended June 30, 2023 and 2022 The following table sets forth the results of our operations for the periods indicated: For the Years Ended June 30, 2023 2022 Change US $ % US $ % US $ % Revenues 4,538,723 100 % 3,988,415 100.0 % 550,308 13.8 % Cost of revenues 3,990,654 87.9 % 4,136,474 103.7 % (145,820 ) (3.5 )% Gross margin 12.1 % N/A (3.7 )% N/A 15.8 % N/A Selling expenses 232,569 5.1 % 385,890 9.7 % (153,321 ) (39.7 )% General and administrative expenses 11,572,888 255.0 % 9,301,784 233.2 % 2,271,104 24.4 % Impairment loss of investment 128,369 2.8 % - - 128,369 100 % Impairment loss of Cryptocurrencies 18,279 0.4 % 170,880 4.3 % (152,601 ) (89.3 )% Impairment loss of fixed assets and right of use asset 33,469 0.7 % 1,006,305 25.2 % (972,836 ) (96.7 )% Provision for doubtful accounts, net of recovery 2,827,511 62.3 % 1,613,504 40.5 % 1,214,007 75.2 % Stock-based compensation 329,778 7.3 % 10,064,622 252.3 % (9,734,844 ) (96.7 )% Total costs and expenses 19,133,517 421.6 % 26,679,459 668.9 % (7,545,942 ) (28.3 )% 27 Revenues Revenues increased by $550,308, or approximately 13.8%, to $4,538,723 for the year ended June 30, 2023 from $3,988,415 for the year ended June 30, 2022.
Freight Logistics Services Freight logistics services primarily consist of cargo forwarding, brokerage, warehouse and other freight services. Revenues from freight logistics services were $3,830,615 for the year ended June 30, 2022, a decrease of $1,113,572, or approximately 22.5%, as compared to $4,944,187 for the year ended June 30, 2021.
Revenues from freight logistics services were $3,806,158 for the year ended June 30, 2023, a decrease of $24,457, or approximately 0.6%, as compared to $3,830,615 for the year ended June 30, 2022.
Our cost of revenue for the sale of crypto-mining equipment was nil as we recognized revenue on a net basis and hence the higher margin which increased the Company’s margin of (8.0)% from freight logistics segment to (3.7%).
Our gross margin was 12.1% and (3.7%) for the years ended June 30, 2023 and 2022, respectively. This increase in gross margin in freight logistics segment was mainly due to increased revenue from our sale of crypto mining equipment. We recognized this revenue on a net basis, thus increasing the overall margin of our operations.
The operating cash outflow for the year ended June 30, 2021 was primarily attributable to our net loss of approximately $11.3 million, consisting of non-cash items including approximately $0.4 million in depreciation and amortization, approximately $0.9 million in impairment and approximately $4.2 million in allowance for deposit.
The operating cash outflow for the year ended June 30, 2023 was primarily attributable to our net loss of approximately $23.1 million which included a $8.4 million lawsuit settlement.
Loss from 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-China. The Company controlled Sino-China through its wholly owned subsidiary Trans Pacific Beijing.
Stock-based Compensation Stock-based compensation was $329,778 for the year ended June 30, 2023, a decrease of $9,734,844 or 96.7%, as compared to $10,064,622 for the year ended June 30, 2022, as we issued less stock compensation to employees and directors. 30 Loss from 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-China.
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. 15 We have been, and may continue to be, negatively impacted by the ongoing COVID-19, which may continually impact our cost of freight, or result in higher cost of revenue, which may in turn materially adversely affect our financial condition and operating results in coming months.
Specifically, Crypto mining machine manufacturers were impacted by the constrained supply of the semiconductors used in the production of the highly specialized crypto mining machines. COVID-related issues exacerbated port congestion and intermittent supplier shutdowns and delays, resulted in delayed shipments and additional expenses to expedite delivery.
Net cash used in investing activities was approximately $1.5 million for the year ended June 30, 2021 due to the acquisition of property and equipment.
Our net cash provided by operating activities was approximately $5.9 million for the year ended June 30, 2022.
Liquidity and Capital Resources Cash Flows and Working Capital As of June 30, 2022, we had $55,833,282 in cash (including cash on hand and cash in bank). The majority of our cash is in banks located in the U.S.
Comprehensive loss attributable to us was $22,952,349 for the year ended June 30, 2023, as compared to $27,482,995 for the year ended June 30, 2022. 31 Liquidity and Capital Resources Cash Flows and Working Capital As of June 30, 2023, we had $17,390,156 in cash (including cash on hand and cash in bank).
We recorded impairment loss of $855,230 for the year ended June 30, 2021 primarily for our mining equipment due to a regulation change in China that banned cryptocurrency mining.
Impairment Loss of Cryptocurrencies We recorded an impairment loss of $18,279 for the year ended June 30, 2023 due to price drops in bitcoin, which the Company deemed a triggering event for impairment testing.
Removed
For the year ended June 30, 2021, the Company also engaged in shipping agency and management services, which were carried out by its subsidiary in the U.S.
Added
Thor Miner wrote off the balance of the deposit it received from SOSNY and the balance of its payment to HighSharp. Impact of COVID-19 The outbreak of the COVID-19 starting from late January 2020 in the PRC spread rapidly to many parts of the world. In March 2020, the World Health Organization declared COVID-19 as a pandemic.
Removed
Due to production issue from HighSharp, Thor Miner was not able to timely deliver the products to SOSNY according to the delivery terms of the PSA and was sued by SOSNY for breach of contract on December 9, 2022.
Added
As a result, we were unable to fulfil our customer orders on a timely basis, resulting in the cancellation of orders and the partial refund of purchases, as evident from the SOSNY settlement. 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.
Removed
Restatement of Previously Issued Financial Statements From March to June 2019, the Company’s subsidiary Trans Pacific Logistic Shanghai Ltd (“Trans Pacific Shanghai”) received approximately $6.2 million (RMB 40 million) from a related party, Shanghai Baoyin Industrial Co., Ltd. (“Shanghai Baoyin”), to pay for accounts receivable of six different customers totaling RMB 40 million.
Added
The increase was primarily due to increased revenue from our sale of crypto mining equipment. The Company ceased to sell crypto-mining equipment since January 1, 2023.
Removed
Shanghai Baoyin is 30% owned by Wang Qinggang, the CEO and legal representative of Trans Pacific Shanghai. Trans Pacific Shanghai subsequently paid RMB 20 million and RMB 10 million to Zhangjiakou Baoyu Trading Co. Ltd.
Added
The following tables present summary information by segments for the years ended June 30, 2023 and 2022: For the Year Ended June 30, 2023 Freight Logistics Services Sales of Crypto Mining Machines Total Net revenues* $ 3,806,158 $ 732,565 $ 4,538,723 Cost of revenues $ 3,990,654 $ - $ 3,990,654 Gross profit $ (184,496 ) $ 732,565 $ 548,069 Depreciation and amortization $ 163,635 $ 713 $ 164,348 Total capital expenditures $ (38,440 ) $ 2,852 $ (35,588 ) Gross margin (4.8 )% 100 % 12.1 % * Including related party revenue of $222,963 from Zhejiang Jinbang Fuel Energy Co., Ltd for the year ended June 30, 2022.
Removed
(“Baoyu”), a third party, in April 2019 and July 2019, respectively, and it made an additional payment of RMB 10 million to Hebei Baoxie Trading Co., Ltd. (“Hebei Baoxie”), a third party, in July 2019.
Added
The decrease in shipping revenue of approximately $0.45 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 $0.43 million.
Removed
As such, for the fiscal year ended June 30, 2019, accounts receivable was understated by RMB 40 million, advance to supplier was overstated by RMB 20 million, and other payables from Shanghai Baoyin, a related party, were understated by RMB 20 million.
Added
The increase was mainly due to the increased professional fees of approximately $4.0 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.
Removed
There was an overstatement of RMB 20 million in total assets and an understatement of total liabilities of RMB 20 million. During the fiscal year ended June 30, 2021, Hebei Baoxie repaid a total of RMB 10 million to Trans Pacific Shanghai, and Trans Pacific Shanghai advanced the RMB 10 million to Shanghai Baoyin.
Added
Impairment Loss of Fixed Assets and Right of Use Assets We recorded impairment losses of $33,469 and $1,006,305 for the year ended June 30, 2023 and 2022.
Removed
The RMB 10 million paid to Shanghai Baoyin was recorded as other receivable, and the RMB 30 million advance to Baoyu was reclassified from an advance to supplier to other receivable. The Company provided a full allowance of its receivables totaling RMB 40 million.
Added
No impairment loss was recorded for the year ended June 30, 2022.
Removed
The Company evaluated this transaction and determined there is no impact on its assets, liabilities, or retained earnings as of June 30, 2020. During the fiscal year ended June 30, 2021, Baoyu repaid a total of RMB 30 million to Trans Pacific Shanghai. The RMB 30 million received was recorded as recovery of bad debt.
Added
Provision for Doubtful Accounts, Net of Recovery Our total bad debt expenses amounted to approximately $2.8 million, mostly due to a $3 million wire transfer made by our former COO, Jing Shan to Goalowen Inc. on May 5, 2023 without the Board’s authorization, as payment for the transfer by Goalowen to the Company of an operating income right to be derived from fishing activities.
Removed
Trans Pacific Shanghai then loaned the same amount to Shanghai Baoyin. Shanghai Baoyin subsequently repaid RMB 4 million to Trans Pacific Shanghai, and Trans Pacific Shanghai loaned the same amount to Wang Qinggang.
Added
The Company has demanded the return of the $3 million but has not been successful. As of June 30, 2023, the Company reviewed the unauthorized transfer, evaluated the collection possibility, and decided to provide 100% allowance provision with amount of USD 3 million.
Removed
The RMB 30 million received was recorded as recovery of bad debt for other receivable and the RMB 30 million paid was recorded as a related party loan receivable. The Company analyzed the transactions and determined the RMB 30 million was originally from Shanghai Baoyin and eventually paid back to the same related parties.
Added
The Company also dissolved its subsidiary Sino-Global Shipping LA, Inc., and on March 14, 2022, the Company discontinued its subsidiary Sino-Global Shipping Canada, Inc. The total loss related to the three disposals amounted to approximately $6.1 million for the year ended June 30, 2022. The Company also dissolved its subsidiary Sino-Global Shipping Australia Pty Ltd. (“SGS AUS”) in November 2022.
Removed
Recovery of bad debt and related party loan receivable was overstated by RMB 30 million for the fiscal year 2021. The Company restated its fiscal year 2021 financial statements to restate related party loans receivable and bad debt recovery.
Added
Lawsuit settlement expenses We recorded $8.4 million in lawsuit settlement expenses for the year ended June 30, 2023, compared to nil in lawsuit settlement expenses for the year ended June 30, 2022. The expenses were related to the lawsuits in connection with the Securities Purchase Agreement and the Financial Advisory Agreement described in Item 1. Business – Litigation. .
Removed
Effects of the restatement are as follows: As Previously Reported Adjustments As Restated Consolidate balance sheet as of June 30, 2021 Loan receivable - related parties $ 4,644,969 $ (4,644,969 ) $ - Total assets $ 52,803,116 $ (4,644,969 ) $ 48,158,147 14 As Previously Reported Adjustments As Restated Consolidated Statement of Stockholder’s Equity as of June 30, 2021 Accumulated deficit $ (30,244,937 ) $ (4,076,825 ) $ (34,321,762 ) Accumulated other comprehensive income (loss) (625,449 ) (103,647 ) (729,096 ) Non-controlling Interest (6,951,134 ) (464,497 ) (7,415,631 ) Total equity $ 47,069,142 $ (4,644,969 ) $ 42,424,173 As Previously Reported Adjustments As Restated Consolidated statement of oeprations for the year ended June 30, 2021 Recovery (provision) for doubtful accounts, net $ 321,168 $ (4,529,806 ) $ (4,208,638 ) Net loss $ (6,773,047 ) $ (4,529,806 ) $ (11,302,853 ) Other comprehensive loss - foreign currency (488 ) (115,163 ) $ (115,651 ) Comprehensive loss $ (6,773,535 ) $ (4,644,969 ) $ (11,418,504 ) As Previously Reported Adjustments As Restated Consolidated statement of cash flow for the year ended June 30, 2021 Cash flows from operating activities: Net loss $ (6,773,047 ) $ (4,529,806 ) $ (11,302,853 ) (Recovery)/ Provision for doubtful accounts (321,168 ) 4,529,806 4,208,638 Other receivable 4,227,239 (4,529,806 ) (302,567 ) Cash flows from investing activities: Loan receivable - related parties $ (4,529,806 ) $ 4,529,806 $ - Impact of COVID-19 The outbreak of the COVID-19 starting from late January 2020 in the PRC has spread rapidly to many parts of the world.
Added
During the year ended June 30, 2023, we generated an additional NOL of approximately $370,000 due to increased third party service cots as a result of our special committee’s investigation. Our PRC subsidiaries’ cumulative NOL amounted to approximately $1,703,000 as of June 30, 2023, which may reduce future taxable income and will expire by 2026.

… 20 more changes not shown on this page.

Other SGLY 10-K year-over-year comparisons