What changed in this filing

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Item 3. Legal Proceedings

2026-03-18 compared with 2025-04-15 · 84 added, 144 removed, 8 unchanged (97% of the section changed)

1 unchanged sentence

Legal case with FT Global Capital, Inc.

In January 2021, FT Global

Capital, Inc.

(“FT Global”), a former placement agent of the Company filed a lawsuit against the Company in the Superior Court

of Fulton County, Georgia.

FT Global served the complaint upon the Company in January 2021.

In the complaint, FT Global alleges

claims, most of which attempt to hold the Company liable under legal theories that relate back to an alleged breach of an exclusive placement

agent agreement between FT Global and the Company in July 2020 which had a term of three months.

FT Global claims that the Company

failed to compensate FT Global for securities purchase transactions between December 2020 and April 2021, pursuant to the terms of the

expired exclusive placement agent agreement.

Allegedly, the exclusive placement agent agreement required the Company to pay FT Global

for capital received during the term of the agreement and for the 12-month period following the termination of the agreement involving

any investors that FT Global introduced and/or wall-crossed to the Company.

However, the Company believes the securities purchase transactions

at issue did not involve the one investor which FT Global introduced or wall-crossed to the Company during the term of the agreement.

FT Global claims approximately $7,000,000 in damages and attorneys’ fees.

The Company timely removed the case to the United

States District Court for the Northern District of Georgia (the (“Court”) on February 9, 2021 based on diversity of jurisdiction.

On March 9, 2021, the Company filed a motion to dismiss based on FT Global’s failure to state a claim which is pending before the

On November 10, 2021, the Court entered an Order granting the Company’s motion to dismiss FT Global’s fraud claim and

breach of contract claim as to the disclosure of its confidential and proprietary information.

The Court denied the Company’s motion

to dismiss FT Global’s i) breach of contract claim for failure to pay FT Global pursuant to the terms of the exclusive placement

agent agreement;

ii) claim for breach of the covenant of good faith and fair dealing;

and iii) claim for attorney’s fees, and the

court concluded that additional information can be obtained through discovery.

On October 12, 2022, the Company filed a motion for summary

judgment on all claims asserted by FT Global in this lawsuit.

On November 2, 2022, FT Global filed its opposition to the Company’s

motion for summary judgment.

On November 16, 2022, the Company filed its reply in support of its motion for summary judgment on all claims

asserted by FT Global in this lawsuit.

On August 31, 2023, the Court entered an Order denying the Company’s motion for summary judgment.

The trial began on April 8, 2024 and ended on April 11, 2024, on which date the jury returned a verdict in favor of FT Global.

11, 2024, the Court entered a judgment awarding FT Global $8,875,265.31 and on April 16, 2024, the Court issued an amended judgment, awarding

FT Global $10,598,379.93, which includes $7,895,265.31 in damages, $1,723,114.62 in prejudgment interest, and $980,000.00 in attorney’s

On May 9, 2024, the Company filed a post-trial motion to set aside the jury verdict and for a new trial and the Court denied the

motion on March 3, 2025.

The Company filed notice of appeal to appeal the judgement to the United States Court of Appeals for the Eleventh

Circuit on April 2, 2025 and the Company will continue to vigorously defend the action against FT Global.

FT Global has registered the Court’s judgment

in the United States District Court for Southern District of New York (“NY Court”), where FT Global has brought a motion requiring

the Company to turn over its stock in its subsidiary companies.

The Company has filed an opposition to the motion, arguing that

according to the New York statute the NY Court should first determine that the value of the stock in the subsidiary is insufficient to

satisfy the judgment as the Company believe the request for turnover is premature before a valuation hearing.

On August 28, 2024, NY Court

granted FT Global’s motion for turnover of Defendant’s shares in Defendant’s wholly-owned subsidiaries as Defendant

1) failed to satisfy the $10.8 million judgment rendered in the Northern District of Georgia and registered in the Southern District of

New York, and 2) is in possession of money and property in which it has an interest.

The NY Court ordered Defendant shall turn over the

shares, membership, or limited partnership interests in all of its subsidiaries, and the corporate seals of its China and Hong Kong-based

subsidiaries, to the U.S.

Marshal for auction or sale until the judgment is satisfied.

Pursuant to the order issued by the United States

District Court for the Southern District of New York on August 28, 2024, the United States Marshal for the Southern District of New York

Marshal”) sold the securities of the subsidiaries of the Company other than those in Hong Kong and China in auction of:

(i) all of the membership interests in Future Fintech Digital Capital Management LLC;

(ii) all of the outstanding shares of FTFT UK Limited;

(iii) the corporate seal of DigiPay FinTech Limited;

(iv) the corporate seal of GlobalKey SharedMall Limited;

(iv) all of the outstanding

shares of Future Fintech Labs Inc.;

and (v) all of the outstanding shares of Future Fintech Digital Number One GP, LLC (USA) to Alec Orudjiev,

the general counsel of FT Global for $25,000 on December 18, 2024.

On December 6, 2024, the Company agreed to sell all issued and outstanding

shares of FTFT SuperComputing Inc.

a wholly owned subsidiary of the Company (“FTFT SuperComputing”) to DDMM Capital LLC (the

“Buyer”) for a purchase price that equals to:

(i) the assumption of the obligations of FTFT SuperComputing totaling $973,072.24

and (ii)$1,000,000, which was paid to an account at Olshan Frome Wolosky LLP to satisfy, in part, the right of payment held by FT Global

Capital, Inc.

arising from the judgment entered in favor of FT Global and against the Company registered in the Southern District of New

York and all matters pertaining to such litigation.

The Company has appealed the turnover order of the NY Court for the auction of securities

of the subsidiaries of the Company in Hong Kong and China to the United States Court of Appeals for the Second Circuit and is waiting

for the final decision of the Court of Appeals.

On February 6, 2025, FT Global filed a motion (“Motion”) in the NY Court,

amended on February 12, 2025, seeking a turnover order for 39,825,939 (before 1 for 10 reverse split) unissued shares of the Company’s

common stock for sale to satisfy the judgement.

The amended motion directs the requested relief not only at the Company but also

at Transhare Corporation, the Company’s Florida-based transfer agent.

The Company believes the Motion lacks merit, as the issuance

of unissued shares in this manner would violate corporate governance principles, Florida corporate law, and federal securities regulations.

The Company has opposed the Motion, which is now fully briefed and awaits decision by the NY Court.

Shareholders Lawsuit

(LaBelle and Janzen)

The LaBelle case is

a putative securities class action filed in January 2024 and is pending in the District of New Jersey.

Denise LaBelle (“Plaintiff”)

alleges that the Company and certain of its officers violated Sections 10(b) and 20(a) of the Securities Exchange Act by making materially

false or misleading statements in the company’s public filings and disclosures relating to the former Chief Executive Officer of

the Company Mr.

Shanchun Huang and charges filed by the SEC against Mr.

Shanchun Huang with manipulative trading in the stock of the

Company using an offshore account shortly before he became the Company’s CEO in 2020 and failing to disclose his beneficial ownership.

Huang has denied the allegations of trading before he became CEO.

Plaintiff claims that these alleged misstatements caused the

Company’s stock to trade at artificially inflated prices, harming investors when the truth was revealed.

The lead plaintiff

and lead counsel were appointed in September 2024.

The Company was served in September 2024, and the Plaintiff is currently seeking

substituted service on the individual defendants.

Once service is resolved, the Plaintiff is expected to file an amended complaint,

which the Company and other defendants intend to move to dismiss.

The Janzen action

is a consolidated shareholder derivative case filed by Jeff Janzen on May 31, 2024, also pending in the District of New Jersey, brought

In January 2021, FT

Global Capital, Inc., a former placement agent of the Company, filed a lawsuit against the Company in the Superior Court of Fulton County,

Georgia, and served the complaint that same month.

The Company has previously reported developments related to this matter in its filings

with the Securities EC, including without limitation, its Annual Report on Form 10-K for the fiscal year ended December 31, 2021, Form

10-K for the fiscal year ended December 31, 2022, Form 10-K for the fiscal year ended December 31, 2023, Form 10-K for the fiscal year

ended December 31, 2024, Quarterly Report on Form 10-Q for the fiscal quarter ended on March 31, 2025.

On June 17, 2025, the

Company entered into a Settlement and Forbearance Agreement with FT Global to resolve four federal court judgments totaling approximately

$4.0 million in cash.

In addition, the Company agreed to issue 340,000 shares of its common stock to FT Global and 60,000 shares to its

legal counsel, and to issue rights entitling FT Global to receive up to 1.3 million additional shares of common stock, with 650,000 eligible

no earlier than six months after signing (Series A Right) and 650,000 eligible no earlier than twelve months after signing (Series B

The Company has issued 400,000 shares of common stock in accordance with the foregoing.

Under the agreement, FT Global agreed

to suspend enforcement actions in exchange for a structured cash settlement and the issuance of shares.

The Company’s

obligations include instalment payments over 18 months and the issuance of shares pursuant to a court order under Section 3(a)(10) of

the Securities Act.

The agreement also includes mutual releases and requires the Company to remain current in its SEC filings and maintain

its listing on a national securities exchange.

Additional details are included in the Company’s Current Report on Form 8-K filed

on June 20, 2025.

As of the date of this report, the Settlement and Forbearance Agreement remains in effect and the parties are

in compliance with the terms.

Shareholders Lawsuit (LaBelle and Janzen)

The LaBelle case is a putative securities class action filed in January

2024 and is pending in the District of New Jersey.

Denise LaBelle (“Plaintiff”) alleges that the Company and certain

of its officers violated Sections 10(b) and 20(a) of the Securities Exchange Act by making materially false or misleading statements in

the company’s public filings and disclosures relating to the former Chief Executive Officer of the Company Mr.

Shanchun Huang and

charges filed by the SEC against Mr.

Shanchun Huang with manipulative trading in the stock of the Company using an offshore account shortly

before he became the Company’s CEO in 2020 and failing to disclose his beneficial ownership.

Huang has denied the allegations

of trading before he became CEO.

Plaintiff claims that these alleged misstatements caused the Company’s stock to trade at artificially

inflated prices, harming investors when the truth was revealed.

The lead plaintiff and lead counsel were appointed in September 2024.

The Company was served in September 2024.

On July 28, 2025, the Plaintiff filed an amended complaint, which the Company and other

defendants intend to move to dismiss.

On January 20, 2026, the Company and certain of its current and former officers and directors

filed a motion to dismiss the derivative complaint pursuant to Rules 12(b)(5) and 12(b)(6) of the Federal Rules of Civil Procedure in

the United States District Court for the District of New Jersey.

The Janzen action is

a consolidated shareholder derivative case filed by Jeff Janzen on May 31, 2024, also pending in the District of New Jersey, brought

nominally on behalf of Future FinTech.

Plaintiff alleges that certain current and former officers and directors breached fiduciary

duties by allowing or failing to prevent the same alleged misconduct at issue in LaBelle, including mismanagement and misleading public

The derivative case has been stayed by stipulation, pending resolution of the anticipated motion to dismiss in LaBelle,

but plaintiff has reserved the right to participate in mediation and settlement discussions relating to the class action.

Settlement with

On December 17, 2019,

the Company announced that it received a subpoena from the SEC’s Division of Enforcement requiring the Company to produce documents

and other information and the Company has cooperated with the SEC’s investigation and information request.

On July 3, 2023, the

SEC announced a settlement of the investigation with the Company.

Without admitting or denying the SEC’s findings, the Company has

consented to:

(i) cease and desist from committing or causing any violations and any future violations of Sections 17(a)(2) and (3) of

the Securities Act, Sections 13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act, and Rules 12b-20, 13a-1, 13a-13 and 13a-15(a) thereunder;

(ii) pay a civil money penalty in the amount of $1,650,000 to the Securities and Exchange Commission for transfer to the general

fund of the United States Treasury, subject to Exchange Act Section 21F(g)(3) and the payment shall be made in the following installments:

the first installment of $150,000 shall be paid within ten (10) days of July 3, 2023 (the “Order Date”);

the second installment

of $375,000 shall be paid within 90 days of the Order Date;

the third installment of $375,000 shall be paid within 180 days of the Order

the fourth installment of $375,000 shall be made within 270 days of the Order Date;

and the last installment of $375,000 shall be

made within 360 days of the Order Date;

(iii) retain, within sixty (60) days of the Order Date, at Company’s own expense, a qualified

independent consultant (the “Consultant”) not unacceptable to the SEC staff, to test, assess, and review the Company’s

internal accounting controls and internal control over financial reporting (collectively, “review), and the Consultant, at the conclusion

of the review, which in no event shall be no more than 180 days after the Order Date, to submit a report of the Consultant to the Company

and the SEC staff and the report shall address the Consultant’s findings and shall include a description of the review performed,

the conclusions reached, and the Consultant’s recommendations for changes or improvements;

and (iv) adopt, implement, and maintain

all policies, procedures and practices recommended in the report of the Consultant within 120 days of receiving the report from the Consultant.

The Company has made all installment payments of the penalties except for the last one which will due on 360 days of the Order Date.

July 26, 2023, the Company also has engaged an independent consultant to test, assess, and review the Company’s internal accounting

Plaintiff alleges that certain current and former officers and directors breached fiduciary duties

by allowing or failing to prevent the same alleged misconduct at issue in LaBelle, including mismanagement and misleading public disclosures.

The derivative case has been stayed by stipulation, pending resolution of the anticipated motion to dismiss in LaBelle, but plaintiff

has reserved the right to participate in mediation and settlement discussions relating to the class action.

Settlement with SEC

On December 17, 2019, the Company announced that

it received a subpoena from the SEC’s Division of Enforcement requiring the Company to produce documents and other information

and the Company has cooperated with the SEC’s investigation and information request.

On July 3, 2023, the SEC announced a settlement

of the investigation with the Company.

Without admitting or denying the SEC’s findings, the Company has consented to:

and desist from committing or causing any violations and any future violations of Sections 17(a)(2) and (3) of the Securities Act, Sections

13(a), 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act, and Rules 12b-20, 13a-1, 13a-13 and 13a-15(a) thereunder;

(ii) pay a civil money

penalty in the amount of $1,650,000 to the Securities and Exchange Commission for transfer to the general fund of the United States Treasury,

subject to Exchange Act Section 21F(g)(3) and the payment shall be made in the following installments:

the first installment of $150,000

shall be paid within ten (10) days of July 3, 2023 (the “Order Date”);

the second installment of $375,000 shall be paid within

90 days of the Order Date;

the third installment of $375,000 shall be paid within 180 days of the Order Date;

the fourth installment

of $375,000 shall be made within 270 days of the Order Date;

and the last installment of $375,000 shall be made within 360 days of the

(iii) retain, within sixty (60) days of the Order Date, at Company’s own expense, a qualified independent consultant

(the “Consultant”) not unacceptable to the SEC staff, to test, assess, and review the Company’s internal accounting

controls and internal control over financial reporting (collectively, “review), and the Consultant, at the conclusion of the review,

which in no event shall be no more than 180 days after the Order Date, to submit a report of the Consultant to the Company and the SEC

staff and the report shall address the Consultant’s findings and shall include a description of the review performed, the conclusions

reached, and the Consultant’s recommendations for changes or improvements;

and (iv) adopt, implement, and maintain all policies,

procedures and practices recommended in the report of the Consultant within 120 days of receiving the report from the Consultant.

Company has made all installment payments of the penalties except for the last one which will due on 360 days of the Order Date.

26, 2023, the Company also has engaged an independent consultant to test, assess, and review the Company’s internal accounting

controls and internal control over financial reporting.

1 unchanged sentence

in December 2023.

The Company has adopted and are implementing and maintaining policies, procedures and practices recommended in the report

of the Consultant.

The Company has adopted and are implementing and maintaining policies, procedures and practices recommended in the

report of the Consultant.

ITEM 4 - MINE SAFETY DISCLOSURES

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 3. Legal Proceedings