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Item 9A. Controls and Procedures

2022-09-28 compared with 2021-09-29 · 787 added, 1238 removed, 308 unchanged (87% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

Pursuant to Rules 13a-15(b) and

15-d-15(b) under the Securities Exchange Act of 1934, as amended (“Exchange Act”), as of June 30, 2021, the Company

carried out an evaluation, with the participation of the Company’s management, including the Company’s Chief Executive Officer

and Chief Financial Officer of the effectiveness of the Company’s disclosure controls and procedures as of the end of the period

covered by this report.

This annual report does not include a report of

management's assessment regarding internal control over financial reporting or an attestation report of the Company's registered

public accounting firm due to a transition period established by rules of the Securities and Exchange Commission for newly public

The term “disclosure

controls and procedures”, as defined under Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and

other procedures of a company that are designed to ensure that information required to be disclosed by a Company in the reports that it

files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s

rules and forms.

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that

information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated

to the Company’s management, including its principal executive and principal financial officer, as appropriate to allow timely decisions

regarding required disclosure.

Based upon that evaluation,

our Chief Executive Officer and Chief Financial Officer concluded that, based on the material weaknesses in the Company’s internal

control over financial reporting as described below, our disclosure controls and procedures were not effective, at the reasonable assurance

level, as of the end of the period covered by this report.

During the years ended June 30, 2021 and 2020

and prior to the completion of our IPO, we had been a private company with limited accounting personnel and other resources to address

our internal control over financial reporting.

During the course of preparing our consolidated financial statements for the years ended

June 30, 2021 and 2020, we determined that we had a material weaknesses in our internal control over financial reporting relating to

our financial reporting processes relating to (i) the design and

operation of our closing and financial reporting process, (ii) the

fact that we had no formal or documented accounting policies or procedures, (iii) the

fact that certain segregation of duties issues existed and (iv) the

fact that there was no formal review process around journal entries recorded.

To address this weakness, we are in the

process of instituting a number of accounting processes and procedures and hired a seasoned financial executive consultant as

Interim Chief Financial Officer, who then became a regular employee full-time CFO when we became a public company.

The CFO is also

undertaking training of our senior and accounting personnel in the intricacies of being a public company.

The actions we have taken are subject to continued

review, supported by confirmation and testing by management.

While we have implemented a plan to remediate these weaknesses, we cannot

assure you that we will be able to remediate these weaknesses, which could impair our ability to accurately and timely report our financial

position, results of operations or cash flows.

Changes in Internal Control over Financial

During the quarter ended June 30, 2021, there

have been no changes in our internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15(d)-15(f)

promulgated under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal

control over financial reporting.

We maintain disclosure controls and procedures designed to ensure that the information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified under the rules and forms of the SEC.

Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosures.

As required by paragraph (b) of Rules 13a-15 and 15d-15 under the Exchange Act, our Chief Executive Officer (our principal executive) and Chief Financial Officer (our principal financial officer and principal accounting officer) carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of June 30, 2022.

Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures (as defined in paragraph (e) of Rules 13a-15 and 15d-15 under the Exchange Act) were not effective at June 30, 2022 due to material weaknesses in our internal control over financial reporting as described below.

Limitations on Internal Control over Financial Reporting

An internal control system over financial reporting has inherent limitations and may not prevent or detect misstatements.

Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

However, these inherent limitations are known features of the financial reporting process.

Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Exchange Act Rule 13a-15(f) and 15d-15(f).

Internal control over financial reporting is a process used to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of our financial statements for external purposes in accordance with generally accepted accounting principles in the United States.

Internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

provide reasonable assurance that transactions are recorded as necessary to permit preparation of our financial statements in accordance with generally accepted accounting principles in the United States, and that our receipts and expenditures are being made only in accordance with the authorization of our board of directors and management;

and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.

Under the supervision and with the participation of our management, including our Chief Executive Officer (our principal executive officer) and Chief Financial Officer (our principal financial officer and principal accounting officer), we performed an assessment of the Company’s significant processes and key controls.

Based on this assessment, management concluded that our internal controls over financial reporting were not effective as of June 30, 2022 due to the material weaknesses described below.

A material weakness is defined within the Public Company Accounting Oversight Board’s Auditing Standard No.

5 as a deficiency or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

We determined that our internal control over financial reporting had the following material weaknesses:

Prior to the completion of our IPO, we had been a private company with limited accounting personnel and other resources to address our internal control over financial reporting.

During the course of preparing our consolidated financial statements for the years ended June 30, 2022 and 2021, we determined that we had material weaknesses in our internal control over financial reporting relating to our financial reporting processes relating to (i) the design and operation of our closing and financial reporting process, (ii) the fact that we had no formal or documented accounting policies or procedures, (iii) the fact that certain segregation of duties issues existed and (iv) the fact that there was no formal review process around journal entries recorded.

Changes in Internal Control over Financial Reporting

Other than as described below, during the quarter ended June 30, 2022, there have been no changes in our internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15(d)-15(f) promulgated under the Exchange Act, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

To address identified material weaknesses, we are in the process of instituting a number of accounting processes and procedures and hired a seasoned financial executive consultant as Chief Financial Officer.

The CFO is also undertaking training of our senior and accounting personnel in the requirements of being a public company.

The Company has engaged an external consulting source to assist in remediation.

The actions we have taken are subject to continued review, supported by confirmation and testing by management.

While we have implemented a plan to remediate these weaknesses, there can be no assurance that we will be able to timely remediate these weaknesses, which could impair our ability to accurately and timely report our financial position, results of operations or cash flows.

As an emerging growth company, the Company is not required to include in this report a report on the effectiveness of internal control over financial reporting by the Company’s independent registered public accounting firm.

OTHER INFORMATION

DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

ITEM 9C DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The following table sets forth the names, ages and titles of our directors,

director nominees, executive officers and key personnel:

The following table sets forth the names, ages and titles of our directors, executive officers and key personnel:

Executive Officers and Directors:

15 unchanged sentences

Executive Officers and Directors :

Phil Rafnson has been our Chairman of the

Board since the company’s founding in 2003 and became President and Chief Executive Officer in January 2021.

has been a major participant in the cinema equipment business for over 30 years going from a sound engineer for RCA Service Co.

National Sales Manager for Xetron Inc., to President and owner of Media Technology Source (MTS), one of the largest global cinema equipment

distribution companies until he sold MTS in 1999.

He has served as Board member of the International Theatre Equipment Association for

12 years and Officer and President of that association for more than 4 years.

Rafnson’s experience in the cinema

equipment industry qualifies him to serve on our board of directors.

Jose Delgado has been our Executive Vice

President, Sales and Marketing since the company’s founding in 2003.

Phil Rafnson has been our Chairman of the Board since the Company’s founding in 2003 and became President and Chief Executive Officer in January 2021.

Rafnson has been a major participant in the cinema equipment business for over 30 years going from a sound engineer for RCA Service Co.

to National Sales Manager for Xetron Inc., to President and owner of Media Technology Source (MTS), one of the largest global cinema equipment distribution companies until he sold MTS in 1999.

He has served as Board member of the International Theatre Equipment Association for 12 years and Officer and President of that association for more than 4 years.

Rafnson’s experience in the cinema equipment industry qualifies him to serve on our board of directors.

Jose Delgado has been our Executive Vice President, Sales and Marketing since the Company’s founding in 2003.

Prior to joining MiT, Mr.

Delgado spent fifteen years

at Christie Digital Systems in increasing positions of responsibility, as National Sales Manager, Director of Sales, and Vice President

During his tenure he increased by 10-fold the cinema presentation product sales of Christie, helping the company become a major

force in the cinema industry.

Previously he held various positions at JVC, including Sales Representative for video products for the Los

Angeles and Las Vegas markets.

Bevan Wright is a Company founding partner

and has been our Executive Vice President, Operations since the Company’s founding in 2003.

In the industry since 1985, Bevan spent

ten years as Cinema Systems Product and Engineering Manager at Christie Digital Systems, directing product development and engineering

support for all cinema product lines, managing the product lines to develop and bring to market fully-integrated solutions for cinema

The previous nine years he held engineering and operations positions at Christie, United Artists, and with other cinema

Wright has over 34 years of experience in the cinema industry in varying positions from operations to technical services

and he holds the Bachelors of Science degree in Mechanical Engineering from Arizona State University, and two patents in cinema projection

Michael Sherman, C.P.A., has been our Chief

Financial Officer since July 2021 and was previously our Interim Chief Financial Officer since July 2018.

A senior financial

professional for over 25 years, Mr.

Sherman has held executive finance positions within a range of companies, both public and

Delgado spent fifteen years at Christie Digital Systems in increasing positions of responsibility, as National Sales Manager, Director of Sales, and Vice President of Sales.

During his tenure he increased by 10-fold the cinema presentation product sales of Christie, helping the company become a major force in the cinema industry.

Previously he held various positions at JVC, including Sales Representative for video products for the Los Angeles and Las Vegas markets.

Bevan Wright is a Company founding partner and has been our Executive Vice President, Operations since the Company’s founding in 2003.

In the industry since 1985, Bevan spent ten years as Cinema Systems Product and Engineering Manager at Christie Digital Systems, directing product development and engineering support for all cinema product lines, managing the product lines to develop and bring to market fully-integrated solutions for cinema exhibitors.

The previous nine years he held engineering and operations positions at Christie, United Artists, and with other cinema exhibitors.

Wright has over 34 years of experience in the cinema industry in varying positions from operations to technical services and he holds the Bachelors of Science degree in Mechanical Engineering from Arizona State University, and two patents in cinema projection technology.

Michael Sherman, C.P.A., has been our Chief Financial Officer since July 2021 and was previously our Interim Chief Financial Officer since July 2018.

A senior financial professional for over 25 years, Mr.

Sherman has held executive finance positions within a range of companies, both public and private.

Prior to joining MiT, Mr.

Sherman was a Finance and Accounting Consultant primarily providing acquisition and other transactional

services to companies in the Telecom and Manufacturing industries.

At EBSCO Industries, he acted as Corporate Controller and Warehouse

Director, while leading the financial integration and on-boarding of the acquisition of an online stand-up desk company in Waukegan, Illinois.

Sherman was a Finance and Accounting Consultant primarily providing acquisition and other transactional services to companies in the Telecom and Manufacturing industries.

At EBSCO Industries, he acted as Corporate Controller and Warehouse Director, while leading the financial integration and on-boarding of the acquisition of an online stand-up desk company in Waukegan, Illinois.

At FDH Velocitel, he was responsible for finance and accounting integration aspects of the acquisition of FDH in Raleigh, North Carolina.

At Mitsubishi Automation, as acting Corporate Controller, he was responsible for their $300 million Annual Operating Plan for North

and South America, while overseeing all finance functions.

Prior to consulting, he was Associate Vice President — Accounting

for TCS Education System, where he was responsible for overall system accounting, the acquisitions of the Santa Barbara and Ventura Colleges

of Law, as well as preparation and submission of the company’s IRS form 990 for 11 legal entities.

Prior to that, he held a senior

management position of Global Vice President of Finance with Liquid Controls Group, an operating group of IDEX, where he was responsible

for 7 entities in 5 Countries.

At Mitsubishi Automation, as acting Corporate Controller, he was responsible for their $300 million Annual Operating Plan for North and South America, while overseeing all

finance functions.

Prior to consulting, he was Associate Vice President — Accounting for TCS Education System, where he was responsible for overall system accounting, the acquisitions of the Santa Barbara and Ventura Colleges of Law, as well as preparation and submission of the company’s IRS form 990 for 11 legal entities.

Prior to that, he held a senior management position of Global Vice President of Finance with Liquid Controls Group, an operating group of IDEX, where he was responsible for 7 entities in 5 Countries.

While there, he also led the acquisition of TopTech Systems in Florida and Faure Herman in France.

to IDEX, he was Vice President Finance for KaVo Dental, a Division of Danaher, where he was responsible for all aspects of Finance and

Prior to IDEX, he was Vice President Finance for KaVo Dental, a Division of Danaher, where he was responsible for all aspects of Finance and Accounting.

A former Public Accounting C.P.A.

with Coopers & Lybrand for 6 years, where he provided audit, accounting, and

business advisory services to a portfolio of clients engaged in the manufacturing and distribution sectors, he holds a bachelor degree

in Accountancy from Northern Illinois University.

with Coopers & Lybrand for 6 years, where he provided audit, accounting, and business advisory services to a portfolio of clients engaged in the manufacturing and distribution sectors, he holds a bachelor degree in Accountancy from Northern Illinois University.

Crothall, Ph.D .

Director in July 2021.

Crothall has been the Chairman, Chief Executive Officer and President of Aspire

Bariatrics, Inc.

(“Aspire”) since November 2010.

became a Director in July 2021.

Crothall has been the Chairman, Chief Executive Officer and President of Aspire Bariatrics, Inc.

(“Aspire”) since November 2010.

Prior to Aspire, Dr.

Crothall served as a Principal of

Liberty Venture Partners, Inc.

Crothall served as a Principal of Liberty Venture Partners, Inc.

from 2006 to November 2010.

Prior to Liberty, she founded Animas Corporation in 1996 and

served as its Chairman, President, Chief Executive Officer, led its $69 million IPO in 2004, and sold it to Johnson and Johnson

Prior to Liberty, she founded Animas Corporation in 1996 and served as its Chairman, President, Chief Executive Officer, led its $69 million IPO in 2004, and sold it to Johnson and Johnson in 2006.

From October 1988 to September 1993, Dr.

Crothall served as President and Chief Executive Officer of Luxar

Corporation, which she founded in 1988, sold and manufactured CO2 lasers for cosmetic, oral, surgical, dental, dermatological and

surgical applications.

Crothall founded Laakmann Electro-Optics, which manufactured and marketed CO2 lasers and was sold to

Johnson & Johnson in 1981.

Crothall served as President and Chief Executive Officer of Luxar Corporation, which she founded in 1988, sold and manufactured CO2 lasers for cosmetic, oral, surgical, dental, dermatological and surgical applications.

Crothall founded Laakmann Electro-Optics, which manufactured and marketed CO2 lasers and was sold to Johnson & Johnson in 1981.

She was employed as an engineer at Hughes Aircraft from 1971 to 1978.

She has been an

Independent Director of Valeritas Holdings, Inc.

She has been an Independent Director of Valeritas Holdings, Inc.

since October 10, 2016.

Crothall is a director of Adhezion

BioMedical and a former Director of Xanitos, Inc.

She served as a former Director of Othera Pharmaceuticals Inc., Intact

Vascular, Inc., and Lungpacer, Inc.

Crothall is a director of Adhezion BioMedical and a former Director of Xanitos, Inc.

She served as a former Director of Othera Pharmaceuticals Inc., Intact Vascular, Inc., and Lungpacer, Inc.

Crothall served as a Director of Animas Corp.

since 1996 until its sale to

She holds over 20 patents and is the recipient of several awards including the Ernst & Young Entrepreneur

of the Year Award in 2003 and the Greater Philadelphia Raymond Rafferty Entrepreneurial Excellence Award in 2004.

She has authored

numerous technical papers and has given numerous papers at scientific/medical symposiums.

since 1996 until its sale to J&J in 2006.

She holds over 20 patents and is the recipient of several awards including the Ernst & Young Entrepreneur of the Year Award in 2003 and the Greater Philadelphia Raymond Rafferty Entrepreneurial Excellence Award in 2004.

She has authored numerous technical papers and has given numerous papers at scientific/medical symposiums.

Crothall holds a B.S.

Electrical Engineering from the University of Pennsylvania and Master of Science and a Ph.D.

in Electrical Engineering from the

University of Southern California.

Crothall’s extensive experience in public company finance and acquisition

experience qualifies her to serve on our board of directors.

in Electrical Engineering from the University of Pennsylvania and Master of Science and a Ph.D.

in Electrical Engineering from the University of Southern California.

Crothall’s extensive experience in public company finance and acquisition experience qualifies her to serve on our board of directors.

Stiska became a Director in July 2021.

Since 2005, Mr.

Stiska has been the principal of Regent Partners, a merchant banking firm, and was a Senior Advisor to Agility Capital,

LLC, a venture lending fund from 2007 to 2013;

prior to that he was Chairman of Commercial Bridge Capital, LLC, also a venture lending

Over the past two decades, John Stiska has served as a CEO, Chairman, Director and investor in more than thirty private and public

Underlying his extensive, twenty-year business leadership and development experience, and service on numerous Boards of Directors,

John was a practicing Corporate and Securities partner at Brobeck, Phleger & Harrison, and of Counsel at Latham & Watkins.

Stiska has been the principal of Regent Partners, a merchant banking firm, and was a Senior Advisor to Agility Capital, LLC, a venture lending fund from 2007 to 2013;

prior to that he was Chairman of Commercial Bridge Capital, LLC, also a venture lending fund.

Over the past two decades, John Stiska has served as a CEO, Chairman, Director and investor in more than thirty private and public companies.

Underlying his extensive, twenty-year business leadership and development experience, and service on numerous Boards of Directors, John was a practicing Corporate and Securities partner at Brobeck, Phleger & Harrison, and of Counsel at Latham & Watkins.

He also taught Securities Regulation as an Adjunct Professor of Law at the University of San Diego School of Law.

He started his career

and became a partner at Luce, Forward, Hamilton & Scripps, before being one of the founding partners of Aylward, Kintz, Stiska,

Wassenaar and Shannahan, which merged into and became the San Diego Office of the Brobeck Firm, shortly after which time he joined Intermark, Inc.

He started his career and became a partner at Luce, Forward, Hamilton & Scripps, before being one of the founding partners of Aylward, Kintz, Stiska, Wassenaar and Shannahan, which merged into and became the San Diego Office of the Brobeck Firm, shortly after which time he joined Intermark, Inc.

as President, and subsequently took Intermark, Inc.

and its majority owned company Triton Group Ltd through an extensive Chapter

7 reorganization and refinancing, emerging as a successfully restructured public company, Triton Group Ltd.

Stiska received a

and its majority owned company Triton Group Ltd through an extensive Chapter 7 reorganization and refinancing, emerging as a successfully restructured public company, Triton Group Ltd.

Stiska received a B.A.

in Accounting, BBA, in 1965 and a J.D.

from the University of Wisconsin in 1970.

Stiska’s extensive experience in

public company finance and related corporate matters qualifies him to serve on our board of directors.

Scott Lloyd Anderson, J.D., CPA became a

Director in July 2021.

Anderson practiced with KPMG as a tax CPA in the early 1980s and since 1983 has practiced as an attorney

representing businesses and their respective owners.

Anderson is a shareholder at the law firm of Fabyanske, Westra, Hart &

Thomson, P.A., which he joined in 1985.

Anderson was on the board of directors of the firm from 1988 through 2014 and was elected

president of the firm over four different time frames.

Stiska’s extensive experience in public company finance and related corporate matters qualifies him to serve on our board of directors.

Scott Lloyd Anderson, J.D., CPA became a Director in July 2021.

Anderson practiced with KPMG as a tax CPA in the early 1980s and since 1983 has practiced as an attorney representing businesses and their respective owners.

Anderson is a shareholder at the law firm of Fabyanske, Westra, Hart & Thomson, P.A., which he joined in 1985.

Anderson was on the board of directors of the firm from 1988 through 2014 and was elected president of the firm over four different time frames.

Over the last 30 years, Mr.

Anderson has structured, negotiated and closed

over 200 merger and acquisition transactions of privately held companies ranging in transaction value from a few million to over a billion

Anderson has been on the board of directors of various construction companies and is a principal owner, director and

officer of a safety engineering company, a small investment company and a small oil and gas company.

Anderson also assisted with

the initial organization of the Company in 2003.

Anderson has structured, negotiated and closed over 200 merger and acquisition transactions of privately held companies ranging in transaction value from a few million to over a billion dollars.

Anderson has been on the board of directors of various construction companies and is a principal owner, director and officer of a safety engineering company, a small investment company and a small oil and gas company.

Anderson also assisted with the initial organization of the Company in 2003.

Anderson has a B.A.

in Business Administration from Augsburg University located

in Minneapolis, Minnesota and a J.D.

in Business Administration from Augsburg University located in Minneapolis, Minnesota and a J.D.

from William Mitchell College of Law located in St.

Paul, Minnesota.

Anderson also taught

accounting and business law at Augsburg University.

Anderson’s extensive experience in finance and acquisition transactions

and prior accounting experience qualifies him to serve on our board of directors.

Anderson also taught accounting and business law at Augsburg University.

Anderson’s extensive experience in finance and acquisition transactions and prior accounting experience qualifies him to serve on our board of directors.

Key Personnel :

Jerry Van de Rydt has been our Senior Vice

President, FF&E Sales since 2005.

Jerry Van de Rydt has been our Senior Vice President, FF&E Sales since 2005.

Jerry has been involved in the cinema industry for over 30 years.

Previously he ran the Los

Angeles office of MTS, which under his leadership became the largest cinema equipment distributor on the West Coast, outfitting over 2,000

screens for clients such as Pacific, Edwards, Mann, Harkins, & Krikorian Theaters, Deluxe Laboratories just to name a few.

2002, he started his own company, Rydt Entertainment Systems which MiT acquired three years later.

David Richards has been our Senior Vice

President, Engineering since the company’s founding in 2003.

Richards has nineteen years of experience in the cinema

Previously he ran the Los Angeles office of MTS, which under his leadership became the largest cinema equipment distributor on the West Coast, outfitting over 2,000 screens for clients such as Pacific, Edwards, Mann, Harkins, & Krikorian Theaters, Deluxe Laboratories just to name a few.

In 2002, he started his own company, Rydt Entertainment Systems which MiT acquired three years later.

David Richards has been our Senior Vice President, Engineering since the Company’s founding in 2003.

Richards has nineteen years of experience in the cinema industry.

He spent five years in engineering and engineering management positions at Christie.

He has been active in SMPTE for the

past eighteen years, and presently serves on several of the SMPTE DC28 digital cinema committees as well as the Film Technology committee

and Projection Technology committee.

Richards is past chair of the SMPTE Hollywood section (’96 – ’97),

and was Program Chair for the first and second SMPTE Film Conferences, held in 1997 and 1998.

He is the author of several SMPTE papers

and articles for various trade publications.

He has been active in SMPTE for the past eighteen years, and presently serves on several of the SMPTE DC28 digital cinema committees as well as the Film Technology committee and Projection Technology committee.

Richards is past chair of the SMPTE Hollywood section (‘96 – ’97), and was Program Chair for the first and second SMPTE Film Conferences, held in 1997 and 1998.

He is the author of several SMPTE papers and articles for various trade publications.

He has a background in mechanical, electronic and electrical engineering design.

Thomas Lipiec has been our Senior Vice President,

Sales & Customer Service since shortly after the company’s founding in 2003.

Lipiec has over 32 years of

professional experience in the cinema industry.

Tom’s career began by occupying several positions at various cinema exhibitors.

Thomas Lipiec has been our Senior Vice President, Sales & Customer Service since shortly after the Company’s founding in 2003.

Lipiec has over 32 years of professional experience in the cinema industry.

Tom’s career began by occupying several positions at various cinema exhibitors.

He later obtained engineering positions at Lucasfilm/THX and was the Director of the post-production division of THX Ltd.

Additionally,

he was the Vice President of Business Development at Constellation 3D.

Tom’s involvement with Lucasfilm included collaborations

with Skywalker Sound and ILM, etc.

Additionally, he was the Vice President of Business Development at Constellation 3D.

Tom’s involvement with Lucasfilm included collaborations with Skywalker Sound and ILM, etc.

These specific technical efforts gained him 2 movie credits for Star Wars:

Episode I and Star

Episode I and Star Wars:

Episode II (D.C.

Frank Tees has been our Vice President,

Technical Sales & Support since 2011.

Tees started his cinema career in 1989, serving in most aspects of theater exhibition

with Krikorian Premiere Theaters.

He spent the past 15 years with the world’s largest exhibitor, Regal Entertainment Group,

and since 2002 has been Director of Technical Services for the Southwest Region.

He managed a team of technicians in preparation, installation

and service of film and digital cinema equipment for 1000 screens in Southern California, Hawaii, Nevada and Arizona.

Frank has extensive

training on 3D and standard DLP and Sony projection systems and practical experience installing them in an integrated and networked environment.

Frank also managed Regal’s technical training program and developed preventative maintenance and tracking guidelines to service

systems according to their warranty.

Frank Tees has been our Vice President, Technical Sales & Support since 2011.

Tees started his cinema career in 1989, serving in most aspects of theater exhibition with Krikorian Premiere Theaters.

He spent the past 15 years with the world’s largest exhibitor, Regal Entertainment Group, and since 2002 has been Director of Technical Services for the Southwest Region.

He managed a team of technicians in preparation, installation and service of film and digital cinema equipment for 1000 screens in Southern California, Hawaii, Nevada and Arizona.

Frank has extensive training on 3D and standard DLP and Sony projection systems and practical experience installing them in an integrated and networked environment.

Frank also managed Regal’s technical training program and developed preventative maintenance and tracking guidelines to service systems according to their warranty.

Family Relationships

There are no family relationships among any of

our executive officers or directors.

There are no family relationships among any of our executive officers or directors.

Board Leadership Structure

Our board of directors does not have a policy

on whether or not the role of the Chief Executive Officer and Chairman should be separate or, if it is to be separate, whether the Chairman

should be selected from the non-employee directors or be an employee.

Our board of directors does not have a policy on whether or not the role of the Chief Executive Officer and Chairman should be separate or, if it is to be separate, whether the Chairman should be selected from the non-employee directors or be an employee.

Currently, we operate with Mr.

Rafnson serving as our Chairman

and our Chief Executive Officer.

Rafnson serving as our Chairman and our Chief Executive Officer.

We currently believe that Mr.

Rafnson serving in both capacities best serves the Company and suits

the talents, expertise and experience that Mr.

Rafnson serving in both capacities best serves the Company and suits the talents, expertise and experience that Mr.

Rafnson brings to the Company.

Committees of the Board of Directors

Our board of directors has established an audit

committee, a compensation committee and a nominating and corporate governance committee, each of which operate pursuant to a charter adopted

by our board of directors.

The board of directors may also establish other committees from time to time to assist our company and the

board of directors.

The composition and functioning of all of our committees comply with all applicable requirements of the Sarbanes-Oxley

Act of 2002, NYSE and SEC rules and regulations, as applicable.

Each committee’s charter is available on our website at www.movingimagetech.com.

The reference to our website address does not constitute incorporation by reference of the information contained at or available through

our website, and you should not consider it to be part of this Report.

Our board of directors has established an audit committee, a compensation committee and a nominating and corporate governance committee, each of which operate pursuant to a charter adopted by our board of directors.

The board of directors may also establish other committees from time to time to assist our company and the board of directors.

The composition and functioning of all of our committees comply with all applicable requirements of the Sarbanes-Oxley Act of 2002, NYSE American and SEC rules and regulations, as applicable.

Each committee’s charter is available on our website at www.movingimagetech.com.

The reference to our website address does not constitute incorporation by reference of the information contained at or available through our website, and you should not consider it to be part of this Report.

Board Member Independence

We are listed on the NYSE American and accordingly, we have applied

the listing standards of the NYSE American in determining the “independence”

of the members of our Board of Directors.

on the listing standards of the NYSE American and after reviewing the relationships with members of our Board, our Board of Directors

has determined that Katherine D.

We are listed on the NYSE American and accordingly, we have applied the listing standards of the NYSE American in determining the “independence” of the members of our Board of Directors.

Based on the listing standards of the NYSE American and after reviewing the relationships with members of our Board, our Board of Directors has determined that Katherine D.

Crothall, Ph.D., John C.

Stiska, Scott Lloyd Anderson qualify as independent directors.

The nominating

and governance committee reviews with the Board at least annually the qualifications of new and existing Board members, considering the

level of independence of individual members, together with such other factors as the Board may deem appropriate, including overall skills

and experience.

The nominating and governance committee also evaluates the composition of the Board as a whole and each of its committees

to ensure the Company’s on-going compliance with the independence standards of the NYSE American.

Stiska, and Scott Lloyd Anderson qualify as independent directors.

The nominating and governance committee reviews with the Board at least annually the qualifications of new and existing Board members, considering the level of independence of individual members, together with such other factors as the Board may deem appropriate, including overall skills and experience.

The nominating and governance committee also evaluates the composition of the Board as a whole and each of its committees to ensure the Company’s on-going compliance with the independence standards of the NYSE American.

Audit committee

1 unchanged sentence

Crothall, Ph.D.

Scott Lloyd Anderson serve on the audit committee, which is chaired by John C.

Our board of directors has determined that each

are “independent”

for audit committee purposes as that term is defined by the rules of the SEC and NYSE, and that each

has sufficient knowledge in financial and auditing matters to serve on the audit committee.

Our board of directors has designated John

Stiska as an “audit committee financial expert,”

as defined under the applicable rules of the SEC.

The audit committee’s

responsibilities include:

and Scott Lloyd Anderson serve on the audit committee, which is chaired by John C.

Our board of directors has determined that each are “independent” for audit committee purposes as that term is defined by the rules of the SEC and NYSE, and that each has sufficient knowledge in financial and auditing matters to serve on the audit committee.

Our board of directors has designated John C.

Stiska as an “audit committee financial expert,” as defined under the applicable rules of the SEC.

The audit committee’s responsibilities include:

● appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm;

pre-approving auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered

public accounting firm;

reviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for

preparing our financial statements;

reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial

statements and related disclosures as well as critical accounting policies and practices used by us;

● pre-approving auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm;

● reviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing our financial statements;

● reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures as well as critical accounting policies and practices used by us;

● coordinating the oversight and reviewing the adequacy of our internal control over financial reporting;

● establishing policies and procedures for the receipt and retention of accounting-related complaints and concerns;

recommending, based upon the audit committee’s review and discussions with management and our independent registered public

accounting firm, whether our audited financial statements shall be included in our Annual Report on Form 10-K;

monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our

financial statements and accounting matters;

● recommending, based upon the audit committee’s review and discussions with management and our independent registered public accounting firm, whether our audited financial statements shall be included in our Annual Report on Form 10-K;

● monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters;

● preparing the audit committee report required by SEC rules to be included in our annual proxy statement;

4 unchanged sentences

Crothall, Ph.D.

Scott Lloyd Anderson serve on the compensation committee, which is chaired by Katherine D.

and Scott Lloyd Anderson serve on the compensation committee, which is chaired by Katherine D.

Crothall, Ph.D.

Our board of directors

has determined that each member of the compensation is “independent”

as defined in the applicable NYSE rules.

The compensation

committee’s responsibilities include:

annually reviewing and recommending to the board of directors the corporate goals and objectives relevant to the compensation of our

Chief Executive Officer;

Our board of directors has determined that each member of the compensation is “independent” as defined in the applicable NYSE American rules.

The compensation committee’s responsibilities include:

● annually reviewing and recommending to the board of directors the corporate goals and objectives relevant to the compensation of our Chief Executive Officer;

● evaluating the performance of our Chief Executive Officer in light of such corporate goals and objectives and based on such evaluation:

(i) recommending to the board of directors the cash compensation of our Chief Executive Officer, and (ii) reviewing and approving

grants and awards to our Chief Executive Officer under equity-based plans;

(i) recommending to the board of directors the cash compensation of our Chief Executive Officer, and (ii) reviewing and approving grants and awards to our Chief Executive Officer under equity-based plans;

● reviewing and recommending to the board of directors the cash compensation of our other executive officers;

1 unchanged sentence

● overseeing and administering our compensation and similar plans;

reviewing and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation

matters and evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified

in the applicable NYSE rules;

● reviewing and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation matters and evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified in the applicable NYSE American rules;

● retaining and approving the compensation of any compensation advisors;

2 unchanged sentences

● preparing the compensation committee report required by SEC rules, if and when required, to be included in our annual proxy statement.

None of the members of our compensation committee

has at any time during the prior three years been one of our officers or employees.

None of our executive officers currently serves,

or in the past fiscal year has served, as a member of the board of directors or compensation committee of any entity that has one or more

executive officers serving on our board of directors or compensation committee.

None of the members of our compensation committee has at any time during the prior three years been one of our officers or employees.

None of our executive officers currently serves, or in the past fiscal year has served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our board of directors or compensation committee.

Nominating and corporate governance committee

1 unchanged sentence

Crothall, Ph.D.

Scott Lloyd Anderson serve on the nominating and corporate governance committee, which is chaired by Scott Lloyd Anderson.

directors has determined that each member of the nominating and corporate governance committee is “independent”

in the applicable NYSE rules.

The nominating and corporate governance committee’s responsibilities include:

developing and recommending to the board of directors’

criteria for board and committee membership;

and Scott Lloyd Anderson serve on the nominating and corporate governance committee, which is chaired by Scott Lloyd Anderson.

Our board of directors has determined that each member of the nominating and corporate governance committee is “independent” as defined in the applicable NYSE American rules.

The nominating and corporate governance committee’s responsibilities include:

● developing and recommending to the board of directors’ criteria for board and committee membership;

● establishing procedures for identifying and evaluating board of director candidates, including nominees recommended by stockholders;

reviewing the composition of the board of directors to ensure that it is composed of members containing the appropriate skills and

expertise to advise us;

● reviewing the composition of the board of directors to ensure that it is composed of members containing the appropriate skills and expertise to advise us;

● identifying individuals qualified to become members of the board of directors;

recommending to the board of directors the persons to be nominated for election as directors and to each of the board’s committees;

reviewing and recommending to the board of directors’

appropriate corporate governance guidelines;

● recommending to the board of directors the persons to be nominated for election as directors and to each of the board’s committees;

● reviewing and recommending to the board of directors’ appropriate corporate governance guidelines;

● overseeing the evaluation of our board of directors.

Code of business conduct and ethics

We have adopted a written code of business conduct

and ethics that applies to our directors, officers, and employees, including our principal executive officer, principal financial officer,

principal accounting officer, or controller, or persons performing similar functions.

A current copy of this code is posted on the Corporate

Governance section of our website, which is located at www.movingimagetech.com.

The information on our website is deemed not to be incorporated

in this Report or to be a part of this Report.

If we make any substantive amendments to, or grant any waivers from, the code of business

conduct and ethics for any officer or director, we will disclose the nature of such amendment or waiver on our website or in a current

report on Form 8-K.

We have adopted a written code of business conduct and ethics that applies to our directors, officers, and employees, including our principal executive officer, principal financial officer, principal accounting officer, or controller, or persons performing similar functions.

A current copy of this code is posted on the Corporate Governance section of our website, which is located at www.movingimagetech.com.

The information on our website is deemed not to be incorporated in this Report or to be a part of this Report.

If we make any substantive amendments to, or grant any waivers from, the code of business conduct and ethics for any officer or director, we will disclose the nature of such amendment or waiver on our website or in a current report on Form 8-K.

Delinquent Section 16(a) Reports

There are no delinquent Section 16(a) reports

since the Company became subject to the Exchange Act on July 7, 2021, after its 2021 fiscal year end.

Section 16(a) of the Exchange Act requires our directors, executive officers, and the persons who beneficially own more than ten percent of our Common Stock, to file reports of ownership and changes in ownership with the Securities and Exchange Commission.

Copies of all filed reports are required to be furnished to us.

Based solely on the reports received by us and on the representations of the reporting persons, we believe that our directors and executive officers complied with all applicable filing requirements during the fiscal year ended June 30, 2022.

Further, based solely on the reports received by us and on the representations of the reporting persons, we believe each greater than ten percent holder complied with all applicable filing requirements during the fiscal year ended June 30, 2022, except for Sound Management Investors, LLC, which did not timely file a Form 3.

EXECUTIVE COMPENSATION

Compensation of Named Executive Officers

The summary compensation table below shows certain

compensation information for services rendered in all capacities for the fiscal years ended June 30, 2021 and 2020.

as set forth herein, no executive officer’s salary and bonus exceeded $100,000 in any of the applicable years.

The following

information includes the dollar value of base salaries, bonus awards, the number of stock options granted and certain other compensation,

if any, whether paid or deferred.

Name and Principal Position

The summary compensation table below shows certain compensation information for services rendered in all capacities for the fiscal years ended June 30, 2022 and 2021.

Other than as set forth herein, no executive officer’s salary and bonus exceeded $100,000 in any of the applicable years.

The following information includes the dollar value of base salaries, bonus awards, the number of stock options granted and certain other compensation, if any, whether paid or deferred.

Incentive Plan

Glenn Sherman(1)

Former President and Chief Executive Officer

Name and Principal Position

Philip Rafnson(1)

4 unchanged sentences

Chief Financial Officer (2)

(1) Glenn Sherman stepped down as President and Chief Executive

Officer in January 2021.

(1) In February 2021, Mr.

Rafnson assumed this position.

(2) Effective August 1, 2018, Michael Sherman was appointed

Interim Chief Financial Officer at an annual salary of $208,000.

Rafnson was appointed President and Chief Executive Officer

Sherman was appointed Chief Financial Officer on July 12, 2021.

(3) In July 2021, the Company paid a discretionary $50,000 in relation to providing personal gaurantees for debt financing.

Employment Agreements

We currently do not maintain any employment, severance

or change in control agreements with our named executive officers.

In addition, our named executive officers are not entitled to any payments

or other benefits in connection with a termination of employment or a change in control.

Outstanding Equity Awards at Fiscal

There were no equity awards outstanding for any

named executive officer as of June 30, 2021.

We currently do not maintain any employment, severance or change in control agreements with our named executive officers.

In addition, our named executive officers are not entitled to any payments or other benefits in connection with a termination of employment or a change in control.

Outstanding Equity Awards at Fiscal Year-End

There were no equity awards outstanding for any named executive officer as of June 30, 2022.

2019 Incentive Stock Plan

We have adopted a 2019 Omnibus Incentive Stock

Plan (the “Plan”).

An aggregate of 750,000 shares of our common stock is reserved for issuance and available for awards under

the Plan, including incentive stock options granted under the Plan.

The Plan administrator may grant awards to any employee, director,

consultant or other person providing services to us or our affiliates.

The Plan shall be initially administered by the

The Plan administrator has the authority to determine, within the limits of the express provisions of the Plan, the individuals

to whom awards will be granted, the nature, amount and terms of such awards and the objectives and conditions for earning such awards.

The Board may at any time amend or terminate the Plan, provided that no such action may be taken that adversely affects any rights or

obligations with respect to any awards previously made under the Plan without the consent of the recipient.

No awards may be made under

the Plan after the tenth anniversary of its effective date.

Awards under the Plan may include incentive stock

options, nonqualified stock options, stock appreciation rights (“SARs”), restricted shares of common stock, restricted stock

Units, performance share or Unit awards, other stock-based awards and cash-based incentive awards.

We have adopted a 2019 Omnibus Incentive Stock Plan (the “Plan”).

On February 14, 2022, the Stockholders approved an amendment increasing the number of stock-based awards available for issuance under the Company’s Plan from 750,000 shares to 1,500,000 shares.

At June 30, 2022, an aggregate of 600,000 shares of our common stock are reserved for issuance and available for awards under the Plan, including incentive stock options granted under the Plan.

The Plan administrator may grant awards to any employee, director, consultant or other person providing services to us or our affiliates.

The Plan is administered by the Compensation Committee of the Board.

The Plan administrator has the authority to determine, within the limits of the express provisions of the Plan, the individuals to whom awards will be granted, the nature, amount and terms of such awards and the objectives and conditions for earning such awards.

The Board may at any time amend or terminate the Plan, provided that no such action may be taken that adversely affects any rights or obligations with respect to any awards

previously made under the Plan without the consent of the recipient.

No awards may be made under the Plan after the tenth anniversary of its effective date.

Awards under the Plan may include incentive stock options, nonqualified stock options, stock appreciation rights (“SARs”), restricted shares of common stock, restricted stock Units, performance share or Unit awards, other stock-based awards and cash-based incentive awards.

Stock Options .

Plan administrator may grant to a participant options to purchase our common stock that qualify as incentive stock options for purposes

of Section 422 of the Internal Revenue Code (“incentive stock options”), options that do not qualify as incentive stock

options (“non-qualified stock options”) or a combination thereof.

The terms and conditions of stock option grants, including

the quantity, price, vesting periods, and other conditions on exercise will be determined by the Plan administrator.

The exercise price

for stock options will be determined by the Plan administrator in its discretion, but non-qualified stock options and incentive stock

options may not be less than 100% of the fair market value of one share of our company’s common stock on the date when the stock

option is granted.

Additionally, in the case of incentive stock options granted to a holder of more than 10% of the total combined voting

power of all classes of our stock on the date of grant, the exercise price may not be less than 110% of the fair market value of one share

of common stock on the date the stock option is granted.

Stock options must be exercised within a period fixed by the Plan administrator

that may not exceed ten years from the date of grant, except that in the case of incentive stock options granted to a holder of more

than 10% of the total combined voting power of all classes of our stock on the date of grant, the exercise period may not exceed five years.

At the Plan administrator’s discretion, payment for shares of common stock on the exercise of stock options may be made in cash,

shares of our common stock held by the participant or in any other form of consideration acceptable to the Plan administrator (including

one or more forms of “cashless”

or “net”

The Plan administrator may grant to a participant options to purchase our common stock that qualify as incentive stock options for purposes of Section 422 of the Internal Revenue Code (“incentive stock options”), options that do not qualify as incentive stock options (“non-qualified stock options”) or a combination thereof.

The terms and conditions of stock option grants, including the quantity, price, vesting periods, and other conditions on exercise will be determined by the Plan administrator.

The exercise price for stock options will be determined by the Plan administrator in its discretion, but non-qualified stock options and incentive stock options may not be less than 100% of the fair market value of one share of our company’s common stock on the date when the stock option is granted.

Additionally, in the case of incentive stock options granted to a holder of more than 10% of the total combined voting power of all classes of our stock on the date of grant, the exercise price may not be less than 110% of the fair market value of one share of common stock on the date the stock option is granted.

Stock options must be exercised within a period fixed by the Plan administrator that may not exceed ten years from the date of grant, except that in the case of incentive stock options granted to a holder of more than 10% of the total combined voting power of all classes of our stock on the date of grant, the exercise period may not exceed five years.

At the Plan administrator’s discretion, payment for shares of common stock on the exercise of stock options may be made in cash, shares of our common stock held by the participant or in any other form of consideration acceptable to the Plan administrator (including one or more forms of “cashless” or “net” exercise).

Stock Appreciation Rights.

Plan administrator may grant to a participant an award of SARs, which entitles the participant to receive, upon its exercise, a payment

equal to (i) the excess of the fair market value of a share of common stock on the exercise date over the SAR exercise price, times

(ii) the number of shares of common stock with respect to which the SAR is exercised.

The exercise price for a SAR will be determined

by the Plan administrator in its discretion;

provided, however, that in no event shall the exercise price be less than the fair market

value of our common stock on the date of grant.

The Plan administrator may grant to a participant an award of SARs, which entitles the participant to receive, upon its exercise, a payment equal to (i) the excess of the fair market value of a share of common stock on the exercise date over the SAR exercise price, times (ii) the number of shares of common stock with respect to which the SAR is exercised.

The exercise price for a SAR will be determined by the Plan administrator in its discretion;

provided, however, that in no event shall the exercise price be less than the fair market value of our common stock on the date of grant.

Restricted Shares and Restricted Units.

Plan administrator may award to a participant shares of common stock subject to specified restrictions (“restricted shares”).

Restricted shares are subject to forfeiture if the participant does not meet certain conditions such as continued employment over a specified

forfeiture period and/or the attainment of specified performance targets over the forfeiture period.

The Plan administrator also may award

to a participant Units representing the right to receive shares of common stock in the future subject to the achievement of one or more

goals relating to the completion of service by the participant and/or the achievement of performance or other objectives (“restricted

Units”).

The Plan administrator may award to a participant shares of common stock subject to specified restrictions (“restricted shares”).

Restricted shares are subject to forfeiture if the participant does not meet certain conditions such as continued employment over a specified forfeiture period and/or the attainment of specified performance targets over the forfeiture period.

The Plan administrator also may award to a participant Units representing the right to receive shares of common stock in the future subject to the achievement of one or more goals relating to the completion of service by the participant and/or the achievement of performance or other objectives (“restricted Units”).

The terms and conditions of restricted share and restricted Unit awards are determined by the Plan administrator.

Performance Awards.

Plan administrator may grant performance awards to participants under such terms and conditions as the Plan administrator deems appropriate.

A performance award entitles a participant to receive a payment from us, the amount of which is based upon the attainment of predetermined

performance targets over a specified award period.

Performance awards may be paid in cash, shares of common stock or a combination thereof,

as determined by the Plan administrator.

The Plan administrator may grant performance awards to participants under such terms and conditions as the Plan administrator deems appropriate.

A performance award entitles a participant to receive a payment from us, the amount of which is based upon the attainment of predetermined performance targets over a specified award period.

Performance awards may be paid in cash, shares of common stock or a combination thereof, as determined by the Plan administrator.

Other Stock-Based Awards.

Plan administrator may grant equity-based or equity-related awards, referred to as “other stock-based awards,”

options, SARs, restricted shares, restricted Units, or performance awards.

The terms and conditions of each other stock-based award will

be determined by the Plan administrator.

Payment under any other stock-based awards will be made in common stock or cash, as determined

by the Plan administrator.

The Plan administrator may grant equity-based or equity-related awards, referred to as “other stock-based awards,” other than options, SARs, restricted shares, restricted Units, or performance awards.

The terms and conditions of each other stock-based award will be determined by the Plan administrator.

Payment under any other stock-based awards will be made in common stock or cash, as determined by the Plan administrator.

Cash-Based Awards.

Plan administrator may grant cash-based incentive compensation awards, which would include performance-based annual cash incentive compensation

to be paid to covered employees subject to Section 162(m) of the Code.

The terms and conditions of each cash-based award will

be determined by the Plan administrator.

The Plan administrator may grant cash-based incentive compensation awards, which would include performance-based annual cash incentive compensation to be paid to covered employees subject to Section 162(m) of the Code.

The terms and conditions of each cash-based award will be determined by the Plan administrator.

Compensation of Directors

No obligations with respect to compensation for

non-employee directors have been accrued or paid for any periods presented in this Report.

Going forward, our board of directors believes

that attracting and retaining qualified non-employee directors will be critical to the future value growth and governance of our company.

Our board of directors also believes that a significant portion of the total compensation package for our non-employee directors should

be equity-based to align the interest of these directors with our stockholders.

On July 7, 2021, the effective date of the IPO,,

each of our non-management directors were granted options to purchase 50,000 shares of common stock at a per share exercise price of $3.00.

The options vest over a one year period of time.

Directors who are also our employees will not receive

any additional compensation for their service on our board of directors.

Our board of directors believes that a significant portion of the total compensation package for our non-employee directors should be equity-based to align the interest of these directors with our stockholders.

Directors who are also our employees do not receive any additional compensation for their service on our board of directors.

The following table sets forth all compensation paid to or earned by each non-employee director of the Company during fiscal year June 30, 2022.

Crothall, Ph.D.

Scott Anderson

(1) The amounts disclosed above reflect the full grant date fair values in accordance with FASB ASC Topic 718.

See “Note 1 - Business Activity And Summary Of Significant Accounting Policies” to our consolidated financial statements for the year ended June 30, 2022.

On July 7, 2021, the effective date of the IPO, each of our non-management directors were granted options to purchase 50,000 shares of Common Stock at a per share exercise price of $3.00.

The options vested over a one-year period of time.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The following table sets forth information

regarding beneficial ownership of our capital stock by:

The following table sets forth information regarding beneficial ownership of our capital stock by:

● each person, or group of affiliated persons, known by us to beneficially own more than 5% of our Common Stock;

● each of our named executive officers;

each of our directors and director nominees;

all of our current executive officers, directors and director nominees as a group.

Applicable percentage ownership is based on

10,626,738 shares of Common Stock outstanding at September 13, 2021.

The information presented below regarding beneficial

ownership of our voting securities has been presented in accordance with the rules of the Commission and is not necessarily indicative

of ownership for any other purpose.

Under these rules, a person is deemed to be a “beneficial owner”

of a security if that

person has or shares the power to vote or direct the voting of the security or the power to dispose or direct the disposition of the security.

A person is deemed to own beneficially any security as to which such person has the right to acquire sole or shared voting or investment

power within sixty (60) days through the conversion or exercise of any convertible security, warrant, option, or other right.

one (1) person may be deemed to be a beneficial owner of the same securities.

The percentage of beneficial ownership by any

person as of a particular date is calculated by dividing the number of shares beneficially owned by such person, which includes the number

of shares as to which such person has the right to acquire voting or investment power within sixty (60) days, by the sum of the number

of shares outstanding as of such date.

Consequently, the denominator used for calculating such percentage may be different for each

beneficial owner.

Except as otherwise indicated below and under applicable community property laws, we believe that the beneficial owners

of our Common Stock listed below have sole voting and investment power with respect to the shares shown.

Unless otherwise noted below, the address of each

person listed on the table is c/o Moving iMage Technologies, Inc., 17760 Newhope Street, Fountain Valley, CA 92708.

● each of our directors;

● all of our current executive officers and directors a group.

Applicable percentage ownership is based on 10,958,398 shares of Common Stock outstanding at September 28, 2022.

The information presented below regarding beneficial ownership of our voting securities has been presented in accordance with the rules of the Commission and is not necessarily indicative of ownership for any other purpose.

Under these rules, a person is deemed to be a “beneficial owner” of a security if that person has or shares the power to vote or direct the voting of the security or the power to dispose or direct the disposition of the security.

A person is deemed to own beneficially any security as to which such person has the right to acquire sole or shared voting or investment power within sixty (60) days through the conversion or exercise of any convertible security, warrant, option, or other right.

More than one (1) person may be deemed to be a beneficial owner of the same securities.

The percentage of beneficial ownership by any person as of a particular date is calculated by dividing the number of shares beneficially owned by such person, which includes the number of shares as to which such person has the right to acquire voting or investment power within sixty (60) days, by the sum of the number of shares outstanding as of such date.

Consequently, the denominator used for calculating such percentage may be different for each beneficial owner.

Except as otherwise indicated below and under applicable community property laws, we believe that the beneficial owners of our Common Stock listed below have sole voting and investment power with respect to the shares shown.

Unless otherwise noted below, the address of each person listed on the table is c/o Moving iMage Technologies, Inc., 17760 Newhope Street, Fountain Valley, CA 92708.

Shares Beneficially Owned

6 unchanged sentences

All executive officers, directors as a group (7 persons)

5% Stockholders:

David Richards

* Less than 1%

(1) Represents shares held by Sound Management

Investors, LLC, an entity wholly-owned and controlled by Mr.

(1) Represents shares held by Sound Management Investors, LLC, an entity wholly-owned and controlled by Mr.

(2) Represents shares underlying stock options.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

All amounts due to Caddy by the Company further to the acquisition

of Caddy are personally guaranteed by Phil Rafnson, our Chairman of the Board.

In July 2021, the Company provided a discretionary $50,000

payment to the Company’s CEO and Chairman of the Board of Directors in relation to these personal guarantees provided in conjunction

with financing Company debt.

See Debt footnote.

In October 2019, the Company executed a loan

agreement with an unaffiliated lender to provide a $1.0 million asset-based bridge loan to be used for working capital purposes.

Funds borrowed bear interest at 13% per annum and are due and payable one year from the origination date of the loan.

The loan is secured

by all assets of the Company and is personally guaranteed by Phil Rafnson, our Chairman of the Board.

Sound Management Investors, LLC,

an entity controlled by Mr.

Rafnson, has pledged all shares of the Company held by it as further security for the repayment of such

All amounts due to Caddy by the Company further to the acquisition of Caddy were personally guaranteed by Phil Rafnson, our Chairman of the Board.

In July 2021, the Company provided a discretionary $50,000 payment to the Company’s CEO and Chairman of the Board of Directors in relation to these personal guarantees provided in conjunction with financing Company debt.

See Note 7 – Debt of the Notes to the Company’s Consolidated Financial Statements.

In October 2019, the Company executed a loan agreement with an unaffiliated lender to provide a $1.0 million asset-based bridge loan to be used for working capital purposes.

Funds borrowed bore interest at 13% per annum and were due and payable one year from the origination date of the loan.

The loan was secured by all assets of the Company and was personally guaranteed by Phil Rafnson, our Chairman of the Board.

Sound Management Investors, LLC, an entity controlled by Mr.

Rafnson, had pledged all shares of the Company held by it as further security for the repayment of such loan.

In July 2021, 100% of the outstanding balance, plus accrued interest, was paid off in full.

In conjunction, all security interests

have been terminated.

In July 2020, Glenn Sherman, our former President,

and David Richards, our Senior Vice President, Engineering and a 5% stockholder, purchased 97,334 and 5,000 shares, respectively, of Acquisition

In conjunction, all security interests have been terminated.

In July 2020, Glenn Sherman, our former President, and David Richards, our Senior Vice President, Engineering and a 5% stockholder at that time, purchased 97,334 and 5,000 shares, respectively, of Acquisition Co.

at $1.50 per share.

We have agreed to indemnify, defend and hold harmless

the members of Moving iMage Technologies LLC from any taxes which may at any time be asserted with respect to the Share Exchange.

We have agreed to indemnify, defend and hold harmless the members of Moving iMage Technologies LLC from any taxes which may at any time be asserted with respect to the Share Exchange.

Director and Officer Indemnification and Insurance

We have entered into indemnification agreements

with each of our directors and executive officers.

These agreements, among other things, require us or will require us to indemnify each

director (and in certain cases their related venture capital funds) and executive officer to the fullest extent permitted by Delaware

law, including indemnification of expenses such as attorneys’

fees, judgments, fines and settlement amounts incurred by the director

or executive officer in any action or proceeding, including any action or proceeding by or in right of us, arising out of the person’s

services as a director or executive officer.

Our amended and restated certificate of incorporation

and our amended and restated bylaws provide that we will indemnify each of our directors and officers to the fullest extent permitted

We also intend to purchase a policy of directors’

and officers’

liability insurance that will insure our directors

and officers against the cost of defense, settlement or payment of a judgment under certain circumstances.

For further information, see

“Executive Compensation — 

Limitation on Liability and Indemnification Matters.”

We have entered into indemnification agreements with each of our directors and executive officers.

These agreements, among other things, require us or will require us to indemnify each director (and in certain cases their related venture capital funds) and executive officer to the fullest extent permitted by Delaware law, including indemnification of expenses such as attorneys’ fees, judgments, fines and settlement amounts incurred by the director or executive officer in any action or proceeding, including any action or proceeding by or in right of us, arising out of the person’s services as a director or executive officer.

Our amended and restated certificate of incorporation and our amended and restated bylaws provide that we will indemnify each of our directors and officers to the fullest extent permitted by the DGCL.

We also have purchased a policy of directors’ and officers’ liability insurance that will insure our directors and officers against the cost of defense, settlement or payment of a judgment under certain circumstances.

Policies and Procedures Regarding Related Party Transactions

Our board of directors has adopted a written related

person transaction policy setting forth the policies and procedures for the review and approval or ratification of related-person transactions.

This policy covers, with certain exceptions set forth in Item 404 of Regulation S-K under the Securities Act, any transaction, arrangement

or relationship, or any series of similar transactions, arrangements or relationships in which we were or are to be a participant, where

the amount involved exceeds $120,000 and a related person had or will have a direct or indirect material interest, including, without

limitation, purchases of goods or services by or from the related person or entities in which the related person has a material interest,

indebtedness, guarantees of indebtedness and employment by us of a related person.

In reviewing and approving any such transactions, our

audit committee will be tasked to consider all relevant facts and circumstances, including, but not limited to, whether the transaction

is on terms comparable to those that could be obtained in an arm’s length transaction and the extent of the related person’s

interest in the transaction.

All of the transactions described in this section occurred prior to the adoption of any related party transactions

A “related person”

Our board of directors has adopted a written related person transaction policy setting forth the policies and procedures for the review and approval or ratification of related-person transactions.

This policy covers, with certain exceptions set forth in Item 404 of Regulation S-K under the Securities Act, any transaction, arrangement or relationship, or any series of similar transactions, arrangements or relationships in which we were or are to be a participant, where the amount involved exceeds $120,000 and a related person had or will have a direct or indirect material interest, including, without limitation, purchases of goods or services by or from the related person or entities in which the related person has a material interest, indebtedness, guarantees of indebtedness and employment by us of a related person.

In reviewing and approving any such transactions, our audit committee will be tasked to consider all relevant facts and circumstances, including, but not limited to, whether the transaction is on terms comparable to those that could be obtained in an arm’s length transaction and the extent of the related person’s interest in the transaction.

All of the transactions described in this section occurred prior to the adoption of any related party transactions policy.

A “related person” means:

● any person who is, or at any time during the applicable period was, one of our executive officers or one of our directors;

● any person who is known by us to be the beneficial owner of more than 5% of our Common Stock;

any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling,

mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law of a director, executive officer or a beneficial

owner of more than 5% of our Common Stock, and any person (other than a tenant or employee) sharing the household of such director, executive

officer or beneficial owner of more than 5% of our Common Stock;

any firm, corporation or other entity in which any of the foregoing persons is a partner or principal or in a similar position or

in which such person has a 10% or greater beneficial ownership interest.

● any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law of a director, executive officer or a beneficial owner of more than 5% of our Common Stock, and any person (other than a tenant or employee) sharing the household of such director, executive officer or beneficial owner of more than 5% of our Common Stock;

● any firm, corporation or other entity in which any of the foregoing persons is a partner or principal or in a similar position or in which such person has a 10% or greater beneficial ownership interest.

PRINCIPAL ACCOUNTING FEES AND SERVICES

The following table provides information regarding

the fees billed to us by CohnReznick in the fiscal years ended June 30, 2021 and 2020.

All fees described below were approved by

CohnReznick LLP (“CohnReznick”) served as our independent registered public accounting firm from 2018 until April 12, 2022.

CohnReznick’ s last completed review of the Company’s consolidated financial statements was for the quarter ended December 31, 2021.

On April 21, 2022, the Company engaged Haskell & White LLP (“H&W”) as our independent registered public accounting firm to review the Company’s consolidated financial statements for the quarter ended March 31, 2022 and to audit the Company’s financial statements for the year ended June 30, 2022.

H&W’s address is 300 Spectrum Center Drive, Suite 300, Irvine, CA 92618 and its PCAOB firm ID number is 200.

The following table provides information regarding the fees billed to us by CohnReznick and H&W in the fiscal years ended June 30, 2022 and 2021.

All fees described below were approved by the Audit Committee:

For the fiscal years ended June 30

Audit Fees (1)

Audit Fees - CohnReznick (1)

Audit Fees – H&W (1)

Audit Related Fees

All Other Fees

Audit fees includes fees associated with the annual audits of our financial statements,

quarterly reviews of our financial statements, and services that are normally provided by the independent registered public

accounting firm in connection with statutory and regulatory filings or engagements.

(1) Audit fees includes fees associated with the annual audits of our financial statements, quarterly reviews of our financial statements, and services that are normally provided by the independent registered public accounting firm in connection with statutory and regulatory filings or engagements.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a)(1) Financial Statements

The financial statements have been

included in Item 8 above.

(a)(2) Financial Statement

Schedules have been omitted because they are not applicable, not material

or because the information is included in the consolidated financial statements or the notes thereto.

The financial statements have been included in Item 8 above and are set forth following Item 16 of this Report.

(a)(2) Financial Statement Schedules

Schedules have been omitted because they are not applicable, not material or because the information is included in the consolidated financial statements or the notes thereto.

(a)(3) Exhibits

The exhibits are incorporated by reference from the Exhibit Index

attached hereto.

The exhibits are incorporated by reference from the Exhibit Index attached hereto.

FORM 10-K SUMMARY

MOVING IMAGE TECHNOLOGIES,

MOVING IMAGE TECHNOLOGIES, INC.

FINANCIAL STATEMENTS

June 30, 2022 and 2021

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

REPORTS OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS (PCAOB ID’s:

200 and 596 )

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED STATEMENTS OF OPERATIONS

CONSOLIDATED STATEMENTS OF CHANGES IN MEMBERS’

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

CONSOLIDATED STATEMENTS OF CASH FLOWS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent

Registered Public Accounting Firm

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors

Moving iMage Technologies, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Moving iMage Technologies, Inc.

(the “Company”) as of June 30, 2022, the related consolidated statements of operations, stockholders’ equity (deficit), and cash flows the year then ended, and the related notes (collectively, the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of June 30, 2022, and the consolidated results of its operations and its cash flows for the year then ended, in conformity with U.S.

generally accepted accounting principles.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the combined financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ Haskell & White LLP

HASKELL & WHITE LLP

We have served as the Company’s auditor since 2022.

Irvine, California

September 28, 2022

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Members

1 unchanged sentence

Opinion on the Consolidated Financial Statements

have audited the accompanying consolidated balance sheets of Moving iMage Technologies, LLC (the “Company”) as of June

30, 2021 and 2020, and the related consolidated statements of operations, changes in members’

deficit and cash flows for the years then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company

as of June 30, 2021 and 2020, and the results of its operations and its cash flows for years then ended, in conformity with the accounting principles generally accepted in the United States of America.

We have audited the accompanying consolidated balance sheet of Moving iMage Technologies, LLC (the “Company”) as of June 30, 2021, and the related consolidated statements of operations, changes in members’ deficit and cash flows for year then ended, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2021, and the results of its operations and its cash flows for the year then ended, in conformity with the accounting principles generally accepted in the United States of America.

Basis for Opinion

consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an

opinion on these consolidated financial statements based on our audits.

We are a public accounting firm registered with the Public Company

Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance

with the U.S.

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated

financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were

we engaged to perform, an audit of its internal control over financial reporting.

As part of our audits we are required to obtain an

understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of

the Company’s internal control over financial reporting.

We conducted our audit in accordance with the standards of the PCAOB.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material

misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as

evaluating the overall presentation of the consolidated financial statements.

We believe that our audits provide a reasonable basis for

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provide a reasonable basis for our opinion.

/s/ CohnReznick LLP

We have served as the Company's auditor since 2018.

September 29, 2021

MOVING IMAGE TECHNOLOGIES,

CONSOLIDATED BALANCE

We have served as the Company's auditor from 2018 to 2021

September 29, 2021 (except for Note 1 which describes the retroactive application of a common control merger

dated July 7, 2021, as to which the date is September 28, 2022)

MOVING IMAGE TECHNOLOGIES, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands)

Current Assets:

Marketable securities - current

Accounts receivable, net

3 unchanged sentences

Long-Term Assets:

Marketable securities – long-term

Property, plant and equipment, net

1 unchanged sentence

Total Long-Term Assets

Liabilities And Members’

Liabilities And Stockholders’ Equity (Deficit)

Current Liabilities:

3 unchanged sentences

Line of credit

Notes payable –

related party

Notes payable –

Notes payable – current

Unearned warranty revenue

2 unchanged sentences

Notes payable, net of current portion

Line of credit, net of current portion

Deferred rent

1 unchanged sentence

Total Liabilities

Members’

Total Liabilities and Members’

Stockholders’ Equity (Deficit)

Common stock, $ 0.00001 par value, 100,000,000 shares authorized, 10,828,398 and 5,666,667 shares issued and outstanding at June 30, 2022 and 2021, respectively

Additional paid-in capital

Accumulated deficit

Total Stockholders’ Equity (Deficit)

Total Liabilities and Stockholders’ Equity (Deficit)

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

TECHNOLOGIES, LLC

OF OPERATIONS

(in thousands except

share and per share amounts)

MOVING IMAGE TECHNOLOGIES, INC.

STATEMENTS OF OPERATIONS

(in thousands except share and per share amounts)

Cost of goods sold

6 unchanged sentences

Other expenses (income)

Unrealized loss on marketable securities

Realized loss (gain) on marketable securities

PPP loan forgiveness

1 unchanged sentence

Total other expense (income)

Pro Forma C-Corporation Information

(Unaudited) —

Historical net loss before income taxes

Pro forma benefit for income taxes

Pro forma net loss

Pro forma net loss per common share basic

Pro forma shares outstanding:

Pro forma net loss per common share diluted

Pro forma shares outstanding:

The accompanying

Notes are an integral part of these consolidated financial statements

TECHNOLOGIES, LLC

STATEMENTS OF

CHANGES IN MEMBERS’ DEFICIT

(in thousands)

Balance June 30, 2019

Balance June 30, 2020

Balance June 30, 2021

Weighted average shares outstanding:

basic and diluted*

Net loss per common share basic and diluted

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

TECHNOLOGIES, LLC

OF CASH FLOWS

MOVING IMAGE TECHNOLOGIES, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

FOR THE YEARS ENDED JUNE 30, 2022 AND 2021

(in thousands except share amounts)

Additional Paid-In

Balance as of July 1, 2020

Share exchange (see Note 1)

Balance as of July 1, 2020, as adjusted

Shares issued in private placement

Balance as of June 30, 2021

Shares of common stock issued for cash in IPO, net of issuance costs

Cashless exercise of warrants

Cashless exercise of underwriter warrants

Grant of options for services

Balance as of June 30, 2022

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

MOVING IMAGE TECHNOLOGIES, INC.

STATEMENTS OF CASH FLOWS

(in thousands)

1 unchanged sentence

Adjustments to reconcile net loss to net cash used in operating activities:

Change in fair value of contingent consideration

PPP loan forgiveness

Provision for doubtful accounts

(Recovery) Provision for doubtful accounts

Depreciation expense

1 unchanged sentence

Deferred rent

Stock option compensation expense

Unrealized loss on investments

Realized (gain) loss on investments

Changes in operating assets and liabilities

7 unchanged sentences

Cash flows from investing activities

Cash acquired in business combination

Sales of marketable securities

Purchases of marketable securities

Purchases of property, plant and equipment

Cash flows from investing activities

Net cash (used in) provided by investing activities

Cash flows from financing activities

Net proceeds from initial public offering

Payments on notes payable

Net borrowings (payments) on line of credit

Proceeds from notes payable

PPP Loan proceeds

Payments on line of credit

Paycheck Protection Program loan proceeds

Proceeds from private placement

Net cash provided by financing activities

4 unchanged sentences

Deferred IPO costs

Acquisition of certain Caddy net assets by issuing notes payable

Reclassification of IPO related costs from other assets to equity

Cash paid during the period:

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

TECHNOLOGIES, LLC

TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization:

Technologies, LLC, (“MiT LLC”

or the “Company”) a Delaware limited liability company formed in September 2003,

designs, integrates, installs and distributes proprietary and custom designed equipment as well as off the shelf cinema products needed

for contemporary cinema requirements.

MiT LLC offers single source solutions for cinema design, procurement, installation and service

to the creative and production communities for screening, digital intermediate and other critical viewing rooms.

MiT LLC offers a wide

range of technical, design and consulting services such as custom engineering, systems design, integration and installation, and digital

technology, as well as software solutions for operations enhancement and theatre management.

MiT LLC also provides turnkey furniture,

fixture and equipment services to commercial cinema exhibitors for new construction and remodels including design, consulting, installation

and project management as well as procurement of seats, lighting, acoustical treatments, screens, projection and sound.

Through its wholly-owned subsidiary,

Moving iMage Technologies, Inc., a Delaware corporation, together with its wholly-owned subsidiaries unless the context indicates otherwise, the (“Company”) was incorporated in June 2020.

The Company, through its wholly owned subsidiary, Moving iMage Technologies, LLC (“MiT LLC”) and MiT LLC’s wholly-owned subsidiary, Moving iMage Acquisition Co., (DBA “Caddy Products”), designs, integrates, installs and distributes proprietary and custom designed equipment as well as off the shelf cinema products needed for contemporary cinema requirements.

The Company also offers single source solutions for cinema design, procurement, installation and service to the creative and production communities for screening, digital intermediate and other critical viewing rooms.

Additionally, the Company offers a wide range of technical, design and consulting services such as custom engineering, systems design, integration and installation, and digital technology, as well as software solutions for operations enhancement and theatre management.

The Company also provides turnkey furniture, fixture and equipment services to commercial cinema exhibitors for new construction and remodels including design, consulting, installation and project management as well as procurement of seats, lighting, acoustical treatments, screens, projection and sound.

Moving iMage Acquisition Co.

(DBA “Caddy Products”), the company designs, develops and manufactures innovative products for the entertainment,

cinema, grocery, worship, restaurant, sports and restroom industries.

(DBA “Caddy Products”) designs, develops and manufactures innovative products for the entertainment, cinema, grocery, worship, restaurant, sports and restroom industries.

Share Exchange:

7, 2021, in connection with the initial public offering of Moving iMage Technologies, Inc.

(the “PubCo”), MiT LLC entered

into an Exchange Agreement (the “Exchange Agreement”) whereby the equity holders of MiT LLC, assigned and transferred

to PubCo their units of MiT LLC, in exchange for an aggregate of 2,350,000 shares of Common Stock of PubCo (the “Share Exchange”).

MiT LLC is considered the acquirer for accounting purposes.

As a result of the Share

Exchange, MiT LLC became a wholly-owned subsidiary of PubCo and is the entity where the Company’s business operations are

However, since the Share Exchange occurred subsequent to the Company’s fiscal year ended June 30, 2021, this Annual

Report on Form 10-K includes the audited consolidated financial statements, and Item 7, "Management's Discussion and Analysis of Financial

Condition and Results of Operations", discusses the results of operations, of MiT LLC for the fiscal year ended June 30, 2021.

TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

In June 2020, MiT LLC members created Moving iMage Technologies, Inc.

(“MiT Inc.”) to facilitate the Company’s initial public offering (“IPO”).

Upon formation of MiT Inc., 2,000,000 shares of MiT Inc.

common stock were issued to members of MiT LLC.

On July 7, 2021, MiT LLC and MiT Inc.

entered into an exchange agreement (“Exchange Agreement”) whereby the members of MiT LLC exchanged their membership interest for 2,350,000 shares of common stock in MiT Inc.

As a result of the Exchange Agreement, the members of MiT LLC owned approximately 79 % or 4,452,334 of the outstanding common stock of MiT Inc.

As a result, MiT LLC (the entity where the Company conducts its business) became a wholly-owned subsidiary of MiT Inc.

(the SEC registrant).

The transaction was accounted for as a merger of entities under common ownership in accordance with generally accepted accounting principles in the United States of America.

This determination was primarily based on the facts that, immediately before and after the transaction:

(i) MiT LLC owners owned a substantial majority of the voting rights in the combined company, (ii) MiT LLC designated a majority of the members of the initial board of directors of the combined company, and (iii) MiT LLC’s senior management holds all key positions in the senior management of the combined company.

As a result, the historical financial statements of MiT LLC and MiT Inc.

for the year ended June 30, 2021 have been retroactively revised to reflect the consolidation of MiT Inc.

All inter-company transactions and balances between MiT Inc.

and MiT LLC have been eliminated.

The consolidated statements of stockholders’ equity (deficit) for the years ended June 30, 2022 and 2021 have been retroactively revised to give effect of the change in reporting entity accounting of MiT Inc.

Initial Public Offering:

July 12, 2021, Moving iMage Technologies, Inc.

(“PubCo”) closed its initial public offering, (“IPO”) and issued 4,830,000 shares

of its common stock at a price of $3.00 per share for net proceeds of approximately $11,469,000 after deducting underwriting discounts,

commissions, and other expenses of approximately $1,906,100.

In connection with the IPO, all MiT LLC membership units were exchanged for

2,350,000 shares of PubCo common stock.

On July 12, 2021, in connection with the PubCo’s IPO, cashless warrants were exercised

for the right to purchase 44,888 shares of the Company’s common stock.

COVID-19 Impact and Liquidity :

December 2019, COVID-19 was initially reported, and in March 2020, the World Health Organization characterized COVID-19 as a

COVID-19 has had a widespread and detrimental effect on the global economy as a result of the continued increase in the

number of cases and affected countries and actions by public health and governmental authorities, businesses, other organizations

and individuals to address the outbreak, including travel bans and restrictions, quarantines, shelter in place, stay at home or

total lock-down orders and business limitations and shutdowns.

The repercussions of the COVID-19 global

pandemic resulted in a significant impact to our customers, specifically those in the entertainment and cinema industries.

have been shuttered since March 2020 in an effort to stem the spread of COVID-19 and studios, for the most part, have rescheduled

their film releases until cinemas can reopen.

Specifically, the pandemic has had a material adverse effect on our business.

significant number of our customers have temporarily ceased operations and others have cancelled or pushed back the delivery of

pending product orders and/or delayed the start of scheduled theater refurbishing and construction projects.

In addition, we have

experienced increased challenges in or cost of acquiring new customers and increased risk in collectability of accounts receivable.

As a result of the aforementioned factors, our financial and operating results for the year ended June 30, 2021 have been, and our

projected financial and operating results for fiscal 2022, are expected to be, materially adversely affected.

The ultimate impact of the COVID-19 pandemic on

our business and results of operations beyond fiscal 2021 is unknown and will depend on future developments, which are highly uncertain

and cannot be predicted with confidence, including the duration and severity of the COVID-19 pandemic and any additional preventative

and protective actions that governments, or we or our customers, may direct, which may result in an extended period of continued business

disruption and reduced operations.

We expect that our results of operations, including revenues, in future periods will continue to be

adversely impacted by the COVID-19 pandemic and its negative effects on global economic conditions, which include the possibility of a

global recession.

Recently, several of the larger theater

chains have reopened in many parts of the United States.

The ability of these chains to reopen is predicated in large part on

decisions by state and local officials to allow, limit or prohibit the reopening of establishments such as cinemas in response to

regionally specific COVID-19 outbreaks.

It is reasonable to expect that any such reopening’s will be done on a gradual basis

with limited occupancy and specific procedures, products, and technologies required to be implemented to protect the safety and

health of returning patrons and employees.

TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

In response to uncertainties associated with the

COVID-19 pandemic, we have taken, and are continuing to take, significant steps to preserve cash and remain in a strong competitive position

when the current crisis subsides by eliminating non-essential costs, reducing employee hours and deferring all non-essential capital

expenditures to minimum levels.

Among other mitigating actions, we have implemented targeted furloughs, significantly reduced our service

and distribution activities and temporarily reduced compensation of our executive officers and certain other employees.

implemented remote work policies for many employees, and the resources available to such employees may not enable them to maintain the

same level of productivity and efficiency, and these and other employees may face additional demands on their time, such as increased

responsibilities resulting from school closures or illness of family members.

Our increased reliance on remote access to our information

systems also increases our exposures to potential cybersecurity breaches.

The Company has recognized recurring

The Company had a working capital deficit of $(2,660,000) and $(983,000) at June 30, 2021 and 2020, respectively.

Members’

deficit was $(2,011,000) and $(969,000) at June 30, 2021 and 2020, respectively.

Cash as of June 30, 2021 was $1,269,000 and the Company

incurred a net loss of $(1,042,000) and $(883,000) for the years ended June 30, 2021 and 2020, respectively.

The Company incurred negative

operating cash flow of $(1,631,000) and $(576,000) for the years ended June 30, 2021 and 2020, respectively.

As of the date these financial

statements were issued, with the actions taken above, existing cash, and cash raised from our initial public offering (See Initial Public

Offering), the Company will have sufficient liquidity to fund operations and essential capital expenditures for the 12 months from the

date these financial statements were issued.

of Consolidation :

The Consolidated Financial Statements include the accounts of Moving iMage Technologies, LLC and its

wholly-owned subsidiary, Moving iMage Acquisition Co.

(DBA Caddy Products).

All significant intercompany transactions and balances

have been eliminated in consolidation.

of Presentation:

The Company’s financial statements have been prepared in accordance with accounting principles

generally accepted in the United States of America (“U.S.

of Fair Values :

The Company’s accounting policies and disclosures require the measurement of fair values, for both financial

and non-financial assets and liabilities on either a recurring or nonrecurring basis.

When measuring the fair value of an asset or a

liability, the Company uses observable market data to the extent such information is available.

Fair values are categorized into different

levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

quoted prices (unadjusted) in

active markets for identical assets or liabilities.

inputs other than quoted

prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e.,

derived from prices).

inputs for the asset or liability

that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability

fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level

of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

TECHNOLOGIES, LLC

NOTES TO FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Deferred Offering

The Company capitalizes certain legal, accounting and other third-party fees that are directly associated with in-process equity

financings as deferred offering costs (non-current) until such financings are consummated.

After consummation of the equity financing,

these costs are recorded in members’ deficit as a reduction of proceeds received as a result of the offering.

equity financing to which those costs relate no longer be considered probable of being consummated, all deferred offering costs will be

charged to operating expenses in the statement of operations at such time.

As of June 30, 2021 and 2020,

$1.1 million and $0.698 million, respectively, of deferred offering costs are capitalized in other assets.

In July 2021, these costs were

reclassified to Equity upon completion of the above IPO.

On July 12, 2021, the Company closed its initial public offering (“IPO”) and issued 4,830,000 shares of its common stock at a price of $ 3.00 per share for net proceeds of approximately $ 12,360,000 after deducting underwriting discounts, commissions, and other expenses of approximately $ 2,130,000 .

Upon the completion of its IPO, the Company reclassified deferred IPO related costs of approximately $ 1,116,000 from other assets to additional paid-in capital.

In connection with the Company’s IPO, the underwriters received warrants to acquire 241,500 shares of the Company’s common stock at $ 3.75 per share.

On July 12, 2021, in connection with the IPO, warrants to purchase 139,611 shares of the Company’s common stock were exercised on a cashless basis.

In April 2022, underwriter warrants were exercised on a cashless basis resulting in the issuance of 192,120 shares of common stock.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Impact of the COVID-19 Pandemic:

The COVID-19 pandemic has had an unprecedented impact on the world and the movie exhibition industry.

The social and economic effects have been widespread.

At various points during the pandemic, authorities around the world imposed measures intended to control the spread of COVID-19, including stay-at-home orders and restrictions on large public gatherings, which caused movie theaters in countries around the world to temporarily close.

The repercussions of the COVID-19 global pandemic resulted in a significant impact to our customers, specifically those in the entertainment and cinema industries.

As a result, the Company implemented various cash preservation strategies, including, but not limited to, temporary personnel and salary reductions, halting non-essential operating and capital expenditures, and negotiating modified timing and/or abatement of contractual payments with landlords and other major suppliers.

Throughout 2020 and 2021 the theatres reopened as soon as local restrictions and the status of the COVID-19 pandemic would allow.

As of June 30, 2022, a large majority of domestic and international theatres were open.

The industry’s recovery to historical levels of new film content, both in terms of the number of new films and box office performance, is still underway, as the industry also continues to adjust to evolving theatrical release windows, competition from streaming and other delivery platforms, supply chain delays, inflationary pressures, labor shortages, wage rate pressures and other economic factors.

Based on the Company’s current estimates of recovery, it believes it has, and will generate, sufficient cash to sustain operations for a period of 12 months from the issuance of these financial statements.

Nonetheless, the COVID-19 pandemic has had, and continues to have, adverse effects on the Company’s business, results of operations, cash flows and financial condition.

Principles of Consolidation:

The consolidated financial statements include the accounts of MiT Inc., its wholly-owned subsidiary, Moving iMage Technologies, LLC (“MiT LLC”), and MiT LLC’s wholly-owned subsidiary, Moving iMage Acquisition Co., (DBA Caddy Products).

All significant intercompany transactions and balances have been eliminated in consolidation.

Basis of Presentation:

The Company’s financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

Segment Reporting:

An operating segment, in part, is a component of an enterprise whose operating results are regularly reviewed by the chief operating decision maker (the “CODM”) to make decisions about resources to be allocated to the segment and assess its performance.

Operating segments may be aggregated only to a limited extent.

The Company’s CODM reviews financial information presented on a consolidated basis, accompanied by disaggregated information about revenues for purposes of making operating decisions and assessing financial performance.

The Company has determined that it has a single operating and reportable segment.

Measurement of Fair Values :

The Company’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities on either a recurring or nonrecurring basis.

When measuring the fair value of an asset or a liability, the Company uses observable market data to the extent such information is available.

Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

quoted prices (unadjusted) in active markets for identical assets or liabilities.

inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices).

inputs for the asset or liability that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Following is the fair value leveling for investment securities that are measured at fair value on a recurring basis as of June 30, 2022:

Equity securities

State and Municipal Debt Securities

Fixed Income Funds

Alternative Funds

Real Estate Funds

The carrying amounts of accounts receivable, accounts payable, and notes payable approximate fair value due to their short maturities.

Assets and Liabilities Not Measured - In addition to assets and liabilities that are measured at fair value on a recurring basis, we also measure certain assets and liabilities at fair value on a nonrecurring basis.

Our non-financial assets, including goodwill, intangible assets and property, plant and equipment, are measured at fair value when there is an indication of impairment and the carrying amount exceeds the asset’s projected undiscounted cash flows.

These assets are recorded at fair value only when an impairment charge is recognized.

There were no impairments recognized for the years ended June 30, 2022 and 2021.

Deferred Offering Costs:

The Company capitalized certain legal, accounting and other third-party fees that were directly associated with its IPO as deferred offering costs (non-current) until such financings were consummated.

As of June 30, 2021, $ 1,116,000 of deferred offering costs were capitalized in other assets.

After completion of the IPO in July 2021, these costs were recorded in the consolidated statement of stockholders’ equity (deficit) as a reduction of the proceeds received from the offering.

Use of Estimates:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires

management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities (including sales returns,

bad debts, inventory reserves, warranty reserves, purchase price allocation and asset impairments), disclosure of contingent assets and

liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

results could differ significantly from those estimates.

Concentration

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities (including sales returns, bad debts, inventory reserves, warranty reserves, purchase price allocation and asset impairments), disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Actual results could differ significantly from those estimates.

Concentration of Cash:

The Company maintains its cash in bank accounts which, at times, may exceed federally insured limits.

The Company has not

experienced any losses in such accounts.

The Company has not experienced any losses in such accounts.

Management believes the Company is not exposed to any significant credit risk on its cash balances.

Cash Equivalents and Marketable Securities:

All highly liquid investments with maturities of three months or less at the date of purchase are classified as cash equivalents.

The Company’s investments in marketable debt securities are carried at either amortized cost or fair value.

Investments in debt securities that the Company has the positive intent and ability to hold to maturity are carried at amortized cost and classified as held-to-maturity.

Investments in debt securities that are not classified as held-to-maturity are carried at fair value and classified as available-for sale.

Realized gains and losses on available-for-sale debt securities are included in net income/loss.

Unrealized gains and losses, net of tax, on available-for-sale debt securities are recognized in other comprehensive gain/(loss).

The Company’s investments in marketable equity securities are classified based on the nature of the securities and their availability for use in current operations.

The Company’s marketable equity securities are measured at fair value with gains and losses recognized in other income/(expense), net.

The cost of securities sold is determined using the specific identification method.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Accounts Receivable:

Accounts receivable are carried at original invoice amount less allowance for bad debts.

Management determines the

allowance for bad debts by identifying troubled accounts and by using historical experience applied to an aging of accounts.

Management determines the allowance for bad debts by identifying troubled accounts and by using historical experience applied to an aging of accounts.

Accounts receivable are written off when deemed uncollectible.

Recoveries of receivables previously written off are recorded when

Accounts receivable are considered to be past due if any portion of the receivable balance is outstanding for more than 90

days past the customer’s granted terms.

The Company does not charge interest on past due balances or require collateral on its

accounts receivable.

As of June 30, 2021 and 2020, the allowance for bad debts is approximately $356,000 and $283,000,

respectively.

TECHNOLOGIES, LLC

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Inventories are stated at the lower of cost or net realizable value, with cost being determined on the first-in first-out cost method

of accounting.

The Company purchases finished goods and materials to assemble kits in quantities that it anticipates will be fully used

in the near term.

Changes in operating strategy, customer demand, and fluctuations in market values can limit the Company’s ability

to effectively utilize all products purchased and can result in finished goods with above-market carrying costs which may cause losses

on sales to customers.

The Company’s policy is to closely monitor inventory levels, obsolescence and lower market values compared

to costs and, when necessary, reduce the carrying amount of its inventory to its net realizable value.

As of June 30, 2021 and 2020, inventory

on hand was comprised primarily of finished goods ready for sale.

On July 1, 2019, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting

Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”) and all

related Accounting Standards Updates by applying the modified retrospective method to all contracts that were not completed on July

The modified retrospective approach required the Company to recognize the cumulative effect of initially applying the new

standard as an adjustment to the opening balance of members’ deficit on July 1, 2019.

Comparative information has not been

restated and continues to be reported under the historical accounting standards in effect for those periods.

The adoption of the new

revenue standard did not result in a cumulative effect adjustment to our members’ equity since there was no significant impact

upon adoption of the new standard.

There was also no material impact to revenues, or any other financial statement line items for

the year ended June 30, 2020 as a result of applying ASC 606.

Revenue is recognized when control of the

promised goods is transferred at the point of shipment to a customer and when performance conditions are satisfied as per the

agreement, in an amount that reflects the consideration that we expect to receive in exchange for those goods as per the agreement

with the customer.

Recoveries of receivables previously written off are recorded when received.

Accounts receivable are considered to be past due if any portion of the receivable balance is outstanding for more than 90 days past the customer’s granted terms.

The Company does not charge interest on past due balances or require collateral on its accounts receivable.

As of June 30, 2022 and 2021, the allowance for bad debts is approximately $ 138,000 and $ 356,000 , respectively.

Inventories are stated at the lower of cost or net realizable value, with cost being determined on the first-in first-out cost method of accounting.

The Company purchases finished goods and materials to assemble kits in quantities that it anticipates will be fully used in the near term.

Changes in operating strategy, customer demand, and fluctuations in market values can limit the Company’s ability to effectively utilize all products purchased and can result in finished goods with above-market carrying costs which may cause losses on sales to customers.

The Company’s policy is to closely monitor inventory levels, obsolescence and lower market values compared to costs and, when necessary, reduce the carrying amount of its inventory to its net realizable value.

As of June 30, 2022 and 2021, inventory on hand was comprised primarily of finished goods ready for sale.

As of June 30, 2022 and 2021, the inventory reserve was $ 434,000 and $ 475,000 , respectively.

Revenue Recognition:

The Company follows Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”).

Revenue is recognized when control of the promised goods is transferred at the point of shipment to a customer and when performance conditions are satisfied as per the agreement, in an amount that reflects the consideration that we expect to receive in exchange for those goods as per the agreement with the customer.

We generate all our revenue from agreements with customers.

In case there are agreements with multiple

performance obligations, we identify each performance obligation and evaluate whether the performance obligations are distinct

within the context of the agreement at the agreement’s inception.

Performance obligations that are not distinct at agreement

inception are combined.

We allocate the transaction price to each distinct performance obligation proportionately based on the

estimated standalone selling price for each performance obligation and then evaluate how the services are transferred to the

customer to determine the timing of revenue recognition.

In case there are agreements with multiple performance obligations, we identify each performance obligation and evaluate whether the performance obligations are distinct within the context of the agreement at the agreement’s inception.

Performance obligations that are not distinct at agreement inception are combined.

We allocate the transaction price to each distinct performance obligation proportionately based on the estimated standalone selling price for each performance obligation and then evaluate how the services are transferred to the customer to determine the timing of revenue recognition.

The Company considers the U.S.

GAAP criteria

for determining whether to report revenue gross as a principal versus net as an agent.

Factors considered include whether the

Company is the primary obligor, has risks and rewards of ownership, and bears the risk that a customer may not pay for the products

provided or services performed.

If there are circumstances where the above criteria are not met, revenues recognized are presented

net of cost of goods sold.

Contract assets consist of conditional or unconditional

rights to consideration.

Accounts receivable represent amounts billed to customers where the Company has an enforceable right to payment

for performance completed to date (i.e., unconditional rights to consideration).

The Company does not have contract assets that represent

conditional rights to consideration.

Accounts Receivable balance as of July 1, 2019 was $2.128 million.

There were no other contract assets

as of June 30, 2021 or 2020.

Contract liabilities consist of refund and

warranty liabilities, as well as deposits received in advance on sales to certain customers.

Such deposits are reflected as customer

deposits and recognized in revenue when control of the products is transferred or when performance conditions are satisfied per the

The change in contract liabilities (customer deposits and unearned warranty revenue) during the year ended June 30, 2020

included $1.079 million for revenue recognized that was included in contract liability as of July 1, 2019.

The change in contract

liabilities (customer deposits and unearned warranty revenue) during the year ended June 30, 2021 included $.690 million for revenue

recognized that was included in contract liability as of July 1, 2020.

Contract liabilities as of July 1, 2019 were $1.079

TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Cost of goods sold includes cost of inventory sold

during the period, net of vendor discounts and allowances, and shipping and handling costs, and sales taxes.

Taxes collected from customers

are included in Accounts Payable on a net basis (excluded from revenues) until remitted to the government.

Deferred contract acquisition costs consist

of sales commissions paid to the sales force and the related employer payroll taxes, collectively “deferred contract

acquisition costs”, are considered incremental and recoverable costs of obtaining a contract with a customer.

The Company has

determined that sales commissions paid are an immaterial component of obtaining a customer’s contract and has elected to

expense sales commissions when earned.

GAAP criteria for determining whether to report revenue gross as a principal versus net as an agent.

Factors considered include whether the Company is the primary obligor, has risks and rewards of ownership, and bears the risk that a customer may not pay for the products provided or services performed.

If there are circumstances where the above criteria are not met, revenues recognized are presented net of cost of goods sold.

Contract assets consist of conditional or unconditional rights to consideration.

Accounts receivable represent amounts billed to customers where the Company has an enforceable right to payment for performance completed to date (i.e., unconditional rights to consideration).

Other than accounts receivable, there were no other contract assets as of June 30, 2022 or 2021.

Contract liabilities consist of refund and warranty liabilities, as well as deposits received in advance on sales to certain customers.

Such deposits are reflected as customer deposits and recognized in revenue when control of the products is transferred or when performance conditions are satisfied per the agreement.

The change in contract liabilities (customer deposits and unearned warranty revenue) during the year ended June 30, 2022 included $ 1,279,000 for revenue recognized that was included in contract liability as of July 1, 2021.

The change in contract liabilities (customer deposits and unearned warranty revenue) during the year ended June 30, 2021 included $ .690 million for revenue recognized that was included in contract liability as of July 1, 2020.

Contract liabilities as of July 1, 2020 were $ .854 million.

Cost of goods sold includes cost of inventory sold during the period, net of vendor discounts and allowances, and shipping and handling costs, and sales taxes.

Taxes collected from customers are included in Accounts Payable on a net basis (excluded from revenues) until remitted to the government.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Deferred contract acquisition costs consist of sales commissions paid to the sales force and the related employer payroll taxes, collectively “deferred contract acquisition costs”, are considered incremental and recoverable costs of obtaining a contract with a customer.

Management has determined that sales commissions paid are an immaterial component of obtaining a customer’s contract and has elected to expense sales commissions when earned.

For the years ended

Disaggregation of Revenue (in 000’s):

June 30, 2022

4 unchanged sentences

Total revenues

Revenue from the sale of equipment is recognized upon delivery of such

equipment to customers and performance conditions are satisfied.

Revenue from installation is recognized upon completion of installation

project and performance obligation is complete.

Software subscription revenue for remote monitoring services is recognized

on a straight-line basis over the term of the contract, usually one year.

Services revenues are generally recognized over time as the

contracts are performed.

IMAGE TECHNOLOGIES, LLC

Revenue from the sale of equipment is recognized upon shipment of such equipment to customers and performance conditions are satisfied.

Revenue from installation is recognized upon completion of installation project and performance obligation is complete.

Software subscription revenue for remote monitoring services is recognized on a straight-line basis over the term of the contract, usually one year.

Services revenues are generally recognized over time as the contracts are performed.

There were no software revenues during the years ended June 30, 2022 or 2021.

Returns and Allowances:

The Company records allowances for discounts and product returns at the time of sale as a reduction of revenue as such allowances can be reliably estimated based on historical experience and known trends.

Shipping and Handling Costs:

Shipping and handling costs are included in cost of goods sold and are recognized as a period expense during the period in which they are incurred.

Advertising Costs:

Advertising costs of approximately $ 18,000 in 2022 and $ 19,000 for 2021 are expensed as incurred within selling and marketing expenses.

Goodwill and Intangible Assets:

Goodwill as of June 30, 2022 and 2021 represents the excess of the purchase price over the fair value of the net identifiable assets acquired in the 2019 Caddy Acquisition.

Goodwill is reviewed for impairment at least annually, in June, or more frequently if a triggering event occurs between impairment testing dates.

The Company operates as a single operating segment and as a single reporting unit for the purpose of evaluating goodwill impairment.

The Company’s impairment assessment begins with a qualitative assessment to determine whether it’s more likely than not that fair value of the reporting unit is less than its carrying value.

The qualitative assessment includes comparing the overall financial performance of the Company against the planned results used in the last quantitative goodwill impairment test.

Additionally, the Company’s fair value is assessed in light of certain events and circumstances, including macroeconomic conditions, industry and market considerations, cost factors, and other relevant entity and Company specific events.

The selection and assessment of qualitative factors used to determine whether it is more likely than not that the fair value of a reporting unit exceeds the carrying value involves significant judgment and estimates.

If it is determined under the qualitative assessment that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then a quantitative impairment test is performed.

Under the quantitative impairment test, the estimated fair value of the reporting unit would be compared with its carrying value (including goodwill).

If the fair value of the reporting unit exceeds its carrying value, then no impairment exists.

If the estimated fair value of the reporting unit is less than its carrying value, an impairment loss would be recognized for the excess of the carrying value of the reporting unit over the fair value, not to exceed the carrying amount of goodwill.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The Company records allowances for discounts and product returns at the time of sale as a reduction of revenue as such

allowances can be reliably estimated based on historical experience and known trends.

Handling Costs:

Shipping and handling costs are included in cost of goods sold and are recognized as a period expense during the period

in which they are incurred.

Advertising costs of approximately $19,000 in 2021 and $14,000 for 2020 are expensed as incurred within selling and marketing

and Intangible Assets:

Goodwill represents the excess of the purchase price over the fair value of the net identifiable assets

acquired in a business combination.

Goodwill is reviewed for impairment at least annually, in June, or more frequently if a

triggering event occurs between impairment testing dates.

The Company operates as a single operating segment and as a single

reporting unit for the purpose of evaluating goodwill impairment.

The Company’s impairment assessment begins with a

qualitative assessment to determine whether it is more likely than not that fair value of the reporting unit is less than its

carrying value.

The qualitative assessment includes comparing the overall financial performance of the Company against the planned

results used in the last quantitative goodwill impairment test.

Additionally, the Company’s fair value is assessed in light of

certain events and circumstances, including macroeconomic conditions, industry and market considerations, cost factors, and other

relevant entity and Company specific events.

The selection and assessment of qualitative factors used to determine whether it is

more likely than not that the fair value of a reporting unit exceeds the carrying value involves significant judgment and estimates.

If it is determined under the qualitative assessment that it is more likely than not that the fair value of a reporting unit is less

than its carrying value, then a quantitative impairment test is performed.

Under the quantitative impairment test, the estimated

fair value of the reporting unit would be compared with its carrying value (including goodwill).

If the fair value of the reporting

unit exceeds its carrying value, then no impairment exists.

If the estimated fair value of the reporting unit is less than its

carrying value, an impairment loss would be recognized for the excess of the carrying value of the reporting unit over the fair

value, not to exceed the carrying amount of goodwill.

The Company tested goodwill impairment

in relation to the COVID-19 pandemic and no impairments were identified for the years ended June 30, 2021 or 2020.

Goodwill is at

risk of future impairment in the event of significant unexpected changes in the Company’s forecasted future results and cash flows,

or if there is a negative change in the long-term outlook for the business or in other factors such as the discount rate, or if there

is a decline in the stock price.

Intangible assets

arising from business combinations, such as customer relationships, trade names, and/or intellectual property, are initially recorded

at fair value.

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Goodwill is at risk of future impairment in the event of significant unexpected changes in the Company’s forecasted future results and cash flows, or if there is a negative change in the long-term outlook for the business or in other factors such as the discount rate, or if there is a decline in the stock price.

Intangible assets arising from business combinations, such as customer relationships, trade names, and/or intellectual property, are initially recorded at fair value.

The Company amortizes these intangible assets over the determined useful life which generally ranges from 11 to 20 years .

The Company reviews its intangible assets for impairment whenever events or circumstances indicate that the carrying amount of an asset

may not be fully recoverable.

The Company reviews its intangible assets for impairment whenever events or circumstances indicate that the carrying amount of an asset may not be fully recoverable.

There were no intangible asset impairments recognized for the years ended June 30, 2022 or 2021.

TECHNOLOGIES, LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Business Combinations:

The Company includes the results of operations of the businesses that it acquires commencing on the respective dates of acquisition.

Company allocates the fair value of the purchase price of its acquisitions to the assets acquired and liabilities assumed based on their

estimated fair values.

The excess of the fair value of the purchase price over the fair values of these identifiable assets and liabilities

is recorded as goodwill.

The Company allocates the fair value of the purchase price of its acquisitions to the assets acquired and liabilities assumed based on their estimated fair values.

The excess of the fair value of the purchase price over the fair values of these identifiable assets and liabilities is recorded as goodwill.

The transaction resulted in the transferring of an entity under common control.

Income Taxes:

The Company is a limited liability company treated as a partnership for federal and state income tax purposes with all income tax liabilities

and/or benefits of the Company being passed through to the members.

As such, there is no recognition of federal or state income taxes

in the accompanying financial statements.

Any uncertain tax position taken by the members is not an uncertain position of the Company.

In accordance

with the operating agreement of MiT, to the extent possible without impairing the Company’s ability to continue to conduct its business

and activities, and in order to permit its members to pay taxes on the taxable income of the Company, MiT makes distributions to members

in the amounts equal to the estimated tax liability of its members computed as if members paid income tax at the highest marginal federal

and state rate applicable to an individual resident of Fountain Valley, CA.

There were no member distributions in the years ended June

30, 2021 or 2020.

The Company utilizes an asset and liability approach for financial accounting and reporting for income taxes.

The provision for income taxes is based upon income or loss after adjustment for those permanent items that are not considered in the determination of taxable income.

Deferred income taxes represent the tax effects of differences between the financial reporting and tax basis of the Company’s assets and liabilities at the enacted tax rates in effect for the years in which the differences are expected to reverse.

The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period that includes the enactment date.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Product Warranty:

1 unchanged sentence

Company policy is to establish reserves for estimated product warranty costs in the period when the related revenue is recognized.

Company has the right to return defective products for up to three years, depending on the manufacturers’ individual policies.

of June 30, 2021 and 2020, the Company has established a warranty reserve of $29,000 and $65,000, respectively, which is included in accrued

expenses in the accompanying consolidated balance sheets.

The changes in the Company’s

aggregate warranty liabilities were as follows for the following periods (in thousands):

The Company has the right to return defective products for up to three years , depending on the manufacturers’ individual policies.

As of June 30, 2022 and 2021, the Company has established a warranty reserve of $ 55,000 and $ 29,000 , respectively, which is included in accrued expenses in the accompanying consolidated balance sheets.

The changes in the Company’s aggregate warranty liabilities were as follows for the following periods (in thousands):

Product warranty liability beginning of period

3 unchanged sentences

Product warranty liability end of the period

TECHNOLOGIES, LLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY

AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Research and Development:

The Company incurs costs to develop new products, as well as improve the appeal and functionality of its existing products.

development costs are charged to expense when incurred.

Issued Accounting Pronouncements:

Research and development costs are charged to expense when incurred.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — BUSINESS ACTIVITY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Share-Based Compensation:

The Company accounts for share-based payments in accordance with ASC 718, Compensation-Stock Compensation .

Accordingly, the Company expenses the fair value of awards made under its share-based compensation plans.

That cost is recognized in the consolidated financial statements over the requisite service period of the grants.

Recently Issued Accounting Pronouncements:

In February 2016, the FASB issued ASU No.

2016-02, Leases (Topic 842 ), which requires

lessees to recognize assets and liabilities for the rights and obligations created by most leases on their balance sheet.

guidance is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years.

application is permitted.

ASU 2016-02 requires modified retrospective adoption for all leases existing at, or entered into after,

the date of initial application, with an option to use certain transition relief.

The Company has not yet evaluated the impact of

this standard.

2019, the FASB issued ASU No.

2016-02, Leases (Topic 842 ), which requires lessees to recognize assets and liabilities for the rights and obligations created by most leases on their balance sheet.

The guidance is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years.

Early application is permitted.

ASU 2016-02 requires modified retrospective adoption for all leases existing at, or entered into after, the date of initial application, with an option to use certain transition relief.

On July 1, 2022, the Company expects to recognize ROU assets and lease liabilities in the range of approximately $ 670,000 and no adjustment to the stockholders’ equity.

Management does not expect the adoption of the new lease standard to impact its consolidated statement of operations or its consolidated statement of cash flows.

In December 2019, the FASB issued ASU No.

2019-12, Income Taxes (Topic 740) :

Simplifying the Accounting for Income Taxes ("ASU

2019-12"), which is intended to simplify the accounting for income taxes.

ASU 2019-12 removes certain exceptions to the general

principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application.

The new standard will be effective

beginning January 1, 2022.

The Company does not expect the adoption of ASU 2019-12 to have a material impact on its financial position

and results of operations upon adoption.

Other pronouncements

issued by the FASB with future effective dates are either not applicable or not significant to the consolidated financial statements of

the Consolidated Company.

Simplifying the Accounting for Income Taxes ("ASU 2019-12"), which is intended to simplify the accounting for income taxes.

ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application.

The new standard will be effective beginning July 1, 2022.

Management does not expect the adoption of ASU 2019-12 to have a material impact on its financial position and results of operations upon adoption.

In January 2017, the FASB issued ASU 2017-04, “Intangibles-Goodwill and Other (Topic 350):

Simplifying the Test for Goodwill Impairment,” effective for fiscal years beginning after December 15, 2021, with an election to adopt early.

The ASU requires only a one-step qualitative impairment test, whereby a goodwill impairment loss will be measured as the excess of a reporting unit’s carrying amount over its fair value.

It eliminates Step 2 of the current two-step goodwill impairment test, under which a goodwill impairment loss is measured by comparing the implied fair value of a reporting unit’s goodwill with the carrying amount of that goodwill.

The Company will adopt this standard on July 1, 2022.

The impact of the new standard will be dependent on the specific facts and circumstances of future impairments, if any.

Other pronouncements issued by the FASB with future effective dates are either not applicable or not significant to the consolidated financial statements of the Company.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 — INVESTMENTS

The following tables show the Company’s cash, cash equivalents and marketable securities by significant investment category as of June 30, 2022 (amounts in 000’s):

Cash Equivalents

Communication

Consumer Discretionary

Consumer Staples

Information Technology

State & Municipal Bonds

Fixed income funds

Alternative, real estate and other

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 — LOSS PER SHARE

Basic loss per share data for each year presented is computed using the weighted average number of shares of common stock outstanding during each such year.

Diluted loss per share data is computed using the weighted average number of common and potentially dilutive securities outstanding during each year.

Potentially dilutive securities consist of shares that would be issued upon the exercise of stock options and warrants, computed using the treasury stock method.

A reconciliation of basic and diluted loss per share is as follows:

For the Year Ended

Weighted average common shares outstanding, basic and diluted

Loss per share

Basic and diluted

The following securities were excluded from the calculation of diluted loss per share in each year because their inclusion would have been anti-dilutive:

For the Year Ended

Total potentially dilutive shares

For the years ended June 30, 2022 and 2021, the Company had net losses, therefore all potentially dilutive securities are deemed to be anti-dilutive and are not included in the diluted loss per share computation.

NOTE 4 — PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment

consist of the following (in thousands):

Property, plant and equipment consist of the following (in thousands):

Production equipment

4 unchanged sentences

Accumulated depreciation

Net property plant

and equipment

expense related to property, plant and equipment was $132,000 in 2021 and $126,000 in 2020, with $120,000 and $111,000 included in

cost of goods sold and $12,000 and $15,000 in general and administrative expense, respectively.

IMAGE TECHNOLOGIES, LLC

TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 2 — PROPERTY, PLANT AND EQUIPMENT

Depreciation of

property, plant and equipment is calculated using the straight-line method over their estimated useful lives as follows:

Net property plant and equipment

Depreciation expense related to property, plant and equipment was $ 19,000 in 2022 and $ 132,000 in 2021, with $ 9,000 and $ 120,000 included in cost of goods sold and $ 10,000 and $ 12,000 in general and administrative expense, respectively.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 4 — PROPERTY, PLANT AND EQUIPMENT (continued)

Depreciation of property, plant and equipment is calculated using the straight-line method over their estimated useful lives as follows:

Leasehold improvements

4 unchanged sentences

Other equipment

NOTE 3 — GOODWILL AND INTANGIBLE

The following

table summarizes the Company’s intangible assets as of June 30, 2021 (in thousands):

NOTE 5 — GOODWILL AND INTANGIBLE ASSETS

The following table summarizes the Company’s intangible assets as of June 30, 2022 (in thousands):

Customer relations

The following

table summarizes the Company’s intangible assets as of June 30, 2020 (in thousands):

The following table summarizes the Company’s intangible assets as of June 30, 2021 (in thousands):

Customer relations

Amortization expense was $95,000 and $88,000

for the years ended June 30, 2021 and 2020, respectively, and are included in general and administrative expense.

Goodwill –

June 30, 2019

Caddy acquisition

Goodwill –

June 30, 2020

Goodwill –

June 30, 2021

IMAGE TECHNOLOGIES, LLC

TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 — GOODWILL AND INTANGIBLE

ASSETS (continued)

amortization expense related to intangible assets subject to amortization at June 30,2021 in each of the five fiscal years

subsequent to June 30, 2021, and thereafter is as follows (amounts in thousands):

IMAGE TECHNOLOGIES, LLC

TO CONSOLIDATED FINANCIAL STATEMENTS

Amortization expense was $ 96,000 and $ 95,000 for the years ended June 30, 2022 and 2021, respectively, and are included in general and administrative expense.

Goodwill related to the Caddy acquisition was $ 287,000 at June 30, 2022 and 2021.

Estimated amortization expense related to intangible assets subject to amortization at June 30, 2022 in each of the five fiscal years subsequent to June 30, 2022, and thereafter is as follows (amounts in thousands):

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 6 — ACCRUED EXPENSES

Accrued expenses consist of the following

(in thousands):

Accrued expenses consist of the following (in thousands):

Employee compensation

Accrued warranty

NOTE 7 — DEBT

Line of Credit

In October 2019, the Company executed

a line of credit agreement with an unaffiliated lender to provide a $1.0 million asset-based bridge loan to be used for working capital

Funds are available on a borrowing base formula with an advance rate of 75% of Moving iMage Technologies, LLC’s accounts

receivable less than 90 days in age (excluding Caddy’s receivables).

Funds borrowed bear interest at 13% per annum and are due and

payable one year from the origination date of the loan.

The loan is secured by all assets of the Company and is personally guaranteed

by Phil Rafnson, our CEO and Chairman of the Board.

In October 2019, MiT LLC executed a line of credit agreement with an unaffiliated lender to provide a $ 1.0 million asset-based bridge loan to be used for working capital purposes.

Funds borrowed bore interest at 13 % per annum and were due and payable one year from the origination date of the loan.

The loan was secured by all assets of MiT LLC and was personally guaranteed by Phil Rafnson, our CEO and Chairman of the Board.

Sound Management Investors, LLC, an entity controlled by Mr.

Rafnson, pledged all

membership units of the Company held by it as further security for the repayment of such loan.

In connection therewith, on the effective

date of the initial public offering, the Company will issue the lender a warrant to acquire $350,000 of shares of common stock at a per

share exercise price equal to the initial public offering price, 83,333 shares underlying said warrant at the assumed initial public offering

price of $3.00 per share.

Approximately $400,000 of the proceeds from the loan were used to pay amounts owed to Caddy for the closing

note further to the Caddy acquisition.

In March 2020, the Company was

informed that it is in default on this loan agreement due to the impact of COVID-19 on our customers’

ability to pay.

In April 2020,

the Company executed an amendment to pay down $350,000 of the outstanding balance.

In addition, monthly interest-only payments on the

outstanding amount are due on the first day of each month.

Loan covenants have been removed.

The line of credit is due September 2021

at an interest rate of 13% per annum.

Rafnson, pledged all membership units of MiT LLC held by it as further security for the repayment of such loan.

In connection with this borrowing, the lender was issued warrants to acquire shares of the Company’s common stock upon completion of its IPO.

On the effective date of the IPO, the lender exercised these warrants to acquire 94,723 shares of the common stock on a cashless basis.

Approximately $ 400,000 of the proceeds from this loan were used to pay amounts owed to Caddy in connection with the Caddy acquisition.

No further borrowings are available under this agreement from March 31, 2020.

As of June 30, 2021,

the outstnading balance of this line of credit was $590,000.

In July 2021, the outstanding balance was paid in full.

Long-term debt at June 30, 2021 and 2020

was as follows (in thousands):

As of June 30, 2021, the outstanding balance of this line of credit was $ 590,000 .

In July 2021, the outstanding balance, and all accrued interest, was paid in full.

There was no outstanding debt as of June 30, 2022.

Long-term debt at June 30, 2021 was as follows (in thousands):

Caddy promissory note

Caddy indemnity promissory note

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5 — DEBT (continued)

The Caddy Promissory note is payable

in monthly installments through August 2024 at an interest rate of Prime plus 2.75%.

The Caddy Indemnity note is payable in monthly installments

due July 2024 at an interest rate of Prime plus 2.75%.

The Caddy Promissory note was payable in monthly installments through August 2024 at an interest rate of Prime plus 2.75 %.

The Caddy Indemnity note was payable in monthly installments due July 2024 at an interest rate of Prime plus 2.75 %.

On January 1, 2020, the interest rate margin increased to 3.75 % on both notes.

All of the notes are collateralized by Caddy assets.

In addition, the notes are guaranteed by Phil Rafnson, the Company’s majority

In August 2021, all related notes and balances were paid in full.

Paycheck Protection

On May 6, 2020, the Company received loan

proceeds in the amount of approximately $694,000 under the Paycheck Protection Program (“PPP”).

On March 13, 2021, the

Company received a second PPP loan receiving proceeds in the amount of approximately $698,000.

The PPP, established as part of the

Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), provides for loans to qualifying businesses for

amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business.

The loans and accrued interest are

forgivable as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities,

and maintains its payroll levels.

The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces

salaries during the eight-week period.

In May 2021, the Company received notification from the SBA that the first loan in the amount

of $694,000, including accrued interest, has been fully forgiven.

As of June 30, 2021, the outstanding balance of

the second PPP loan was $698,000, of which $73,000 is included in notes payable current in the consolidated balance sheets.

Any unforgiven portion of a PPP loan is

payable over two years at an interest rate of 1%, with a deferral of payments for the first six months.

The Company used the

proceeds for purposes consistent with the PPP.

While the Company currently believes that its use of the second loan proceeds will

meet the conditions for forgiveness of the loan, we cannot assure you that we will not take actions that could cause the Company to

be ineligible for forgiveness of the second loan, in whole or in part.

NOTE 6 — MEMBERS’ EQUITY

As of June 30, 2020, the Company had one

class of membership units outstanding, consisting of 9,900 Class B Voting Membership Units.

All of the notes were collateralized by Caddy assets.

In addition, the notes were guaranteed by Phil Rafnson, the Company’s majority shareholder.

In August 2021, all related Caddy notes and balances were paid in full.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 7 — DEBT (continued)

Paycheck Protection Program

On May 6, 2020, the Company received loan proceeds in the amount of approximately $ 694,000 under the Paycheck Protection Program (“PPP”).

On March 13, 2021, the Company received proceeds in the amount of approximately $ 698,000 from a second PPP loan.

The PPP, established as part of the Coronavirus Aid, Relief, and Economic Security Act, provides for loans to qualifying businesses for amounts up to 2.5 times of the average monthly payroll expenses of the qualifying business.

The loans and accrued interest are forgivable as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels.

The amount of loan forgiveness will be reduced if the borrower terminates employees or reduces salaries during the eight-week period.

In May 2021, the Company received notification from the Small Business Administration that the first loan in the amount of $ 694,000 , including accrued interest, has been fully forgiven.

The Company used the proceeds for purposes consistent with the PPP.

In April 2022, the Company received notice that on March 23, 2022, its second PPP loan in the amount of $ 698,000 plus accrued interest of $ 7,000 has been fully forgiven and is paid in full.

NOTE 8 — STOCKHOLDERS’ EQUITY

In 2019, the Company adopted the 2019 Omnibus Incentive Plan (the “Plan”).

The Plan, as amended, provides for the issuance of stock-based awards to employees.

As of June 30, 2022, the Plan provided for the issuance of up to 750,000 stock-based awards.

There are 600,000 stock-based awards available to grant under the Plan at June 30, 2022.

In July 2020, the Company, through a Private Placement, issued 666,667 shares of stock for total gross proceeds of $ 887,000 .

Net proceeds of $ 784,000 were received after deducting offering costs of $ 103,000 .

In conjunction with the private placement, warrants for 50,000 shares were issued to Boustead Securities, LLC.

In July 2021, MiT Inc.

entered into an Exchange Agreement with MiT LLC pursuant to which MiT Inc.

agreed to exchange membership units for 2,350,000 shares of Common Stock representing 41.4 % of the equity as of such date on a fully diluted basis for no consideration.

The shares were exchanged as part of the Exchange Agreement with the Company as described in Note 1.

In July 2021, the Company granted options to non-employee directors to purchase an aggregate of 150,000 shares of its common stock at an exercise price of $ 3.00 per share.

The options vest one year from the date of grant, expire ten years from the date of grant and had an aggregate grant date fair value of $ 244,200 , which will be recognized ratably over the vesting period.

These options, which were the only options granted during the year ended June 30, 2022, had a grant-date fair value of $ 1.63 per share.

The Company recognized compensation expense for stock option awards of approximately $ 244,200 during the year ended June 30, 2022.

None of the these potentially dilutive securities were included in the computation of diluted earnings per share as their impact would be anti-dilutive.

The estimated fair value of each option award granted was determined on the date of grant using the Black-Scholes option valuation model.

The following weighted average assumptions were used for option grants during the year ended June 30, 2022:

Risk-free interest rate

Expected volatility

Dividend yield

Expected option term in years

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 8 — STOCKHOLDERS’ EQUITY (continued)

A summary of the status of the Company’s stock options as of June 30, 2022 and changes during the year then ended are presented below.

Balance, July 1, 2021

Granted during the year

Exercised during the year

Terminated/Expired during the year

Balance, June 30, 2022

The following table summarizes information about outstanding and exercisable stock options at June 30, 2022:

Range of Exercise Price

Exercise Price

A summary of the status of the Company’s stock warrants as of June 30, 2022 and 2021 and changes during the years ended June 30, 2022 and 2021 are presented below.

Balance, July 1, 2020

Granted during the year

Exercised during the year

Terminated/Expired during the year

Balance, June 30, 2021

Granted during the year

Exercised during the year

Terminated/Expired during the year

Balance, June 30, 2022

In July 2021, warrants were exercised on a cashless basis resulting in the issuance of 139,611 shares of common stock.

In April 2022, underwriter warrants were exercised on a cashless basis resulting in the issuance of 192,120 shares of common stock.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 — INCOME TAXES

The following table summarizes deferred tax assets and liabilities as of the date of the Exchange Agreement and through June 30, 2022:

Existing valuation allowance

Deferred Tax Liabilities

Prior to business combination

Deferred tax assets

Deferred tax liabilities

Valuation allowance

Total MiT Inc.

June 30, 2022

Total July 7, 2021 (see note 1)

The following table summarizes the components of deferred tax assets and deferred tax liabilities:

Assets (Liabilities)

Inventory reserve

Accumulated depreciation

Accumulated goodwill amortization

Accumulated intangible amortization

Unrealized loss on investments

Deferred rent

Warranty reserve

Stock compensation

Net operating loss carryforward

Allowance for doubtful accounts

Valuation allowance

Total June 30, 2022

Inventory reserve

Accumulated depreciation

Accumulated goodwill amortization

Deferred rent

Warranty reserve

Allowance for doubtful accounts

Valuation allowance

Total July 7, 2021 (see note 1)

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 9 — INCOME TAXES (continued)

The income tax expense differs from the amount computed by applying the statutory income tax rates to the loss before income tax.

The following table shows the reasons for these differences:

Net loss before tax

United States corporate tax rate

Tax Benefit at statutory rate

Differences due to:

PPP Loan Forgiveness

Other, permanent differences

Change in valuation allowance

Income Tax (Benefit) Expense

Effective Tax Rate

At June 30, 2022 the Company has approximately $ 2,180,000 of U.S.

State and $ 2,200,000 of U.S.

Federal NOL carryforwards, which will not expire and will be available for future use to offset taxable income.

The Company recognized a valuation allowance of $ 892,000 and $ 235,000 as of June 30, 2022 and 2021, respectively, as all U.S.

Federal and state deferred tax assets have been determined to be not more likely than not realizable.

Management does not believe that it had any significant uncertain tax positions at June 30, 2022 and 2021, nor is this expected to change within the next twelve months due to the settlement and expiration of statutes of limitation.

NOTE 10 — RELATED PARTY TRANSACTIONS

July 2020, the Company received a $784,000 forgivable noninterest-bearing working capital loan from PubCo, (formerly MIT

Acquisition, Inc.), an affiliated entity.

In September 2020, the PubCo.

signed a Letter of Intent to provide the Company additional

borrowings, under the same terms as the working capital loan.

In February and March 2021, the proceeds of approximately $550,000 were received

by the Company under this agreement providing additional working capital.

As of June 30, 2021, the outstanding balance under

this agreement is $1.272 million.

Per terms of the loan agreement, this entire amount was forgiven in conjunction with the Company’s

IPO in July 2021.

In July 2021, the Company provided a discretionary

$50,000 payment to the Company’s CEO and Chairman of the Board of Directors for personal guarantees provided in conjunction with

financing company debt.

See Debt footnote.

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

In July 2021, the Company provided a discretionary $ 50,000 payment to the Company’s CEO and Chairman of the Board of Directors for personal guarantees provided in conjunction with financing company debt.

See Note 7 - Debt.

Approximately $ 32,000 of the Company's net sales in the year ended June 30, 2022 was to companies deemed to be related parties.

Accounts receivable from related parties were zero as of June 30, 2022 and 2021.

NOTE 11 — CUSTOMER AND VENDOR CONCENTRATIONS

One customer accounted for more than 10% of the Company’s sales for the years ended June 30, 2021.

There was no outstanding

balance related to this customer at June 30, 2021.

No customers accounted for more than 10% of sales for the year ended June 30,

vendor provided more than 10% of the Company’s purchases for the year ended June 30, 2021.

Approximately 14% and 13% of the

Company’s purchases were provided by two vendors for the year ended June 30, 2020.

At June 30, 2020, the amount in outstanding

payables related to these two vendors was approximately $760,000.

NOTE 9 — COMMITMENTS AND CONTINGENCIES

Operating Leases:

occupies an executive office and warehouse space in Fountain Valley, CA, pursuant to separate lease agreements.

Rent expense was $281,000

in 2021 and $285,000 in 2020.

In September 2018, the Company reached an agreement to extend the executive office lease effective February

1, 2019 by an additional five years.

The monthly rent payable for the first year of the newly extended term is $12,620 and will be increased

by 3% on each anniversary date.

In April 2020, the Company reached an agreement whereby April, May and June 2020 monthly rent payments

related to this lease in the amount of $19,500 are deferred but payable in six monthly installments of $3,250 commencing on the first

day of July 2020.

In addition, the term of the lease was extended for one year from the anniversary date.

Also, in September 2018, the Company reached

an agreement to extend the warehouse lease effective February 1, 2019 by an additional five years.

The monthly rent payable for the

first year of the newly extended term is $9,465 and will be increased by 3% on each anniversary date.

In April 2020, the Company

reached an agreement whereby April, May and June 2020 monthly rent payments in the amount of $14,624 are deferred but payable in six

monthly installments of $2,437 commencing on the first day of July 2020.

In addition, the term of the lease was extended for one

year from the anniversary date.

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

No customer accounted for more than 10% of the Company’s revenue for the year ended June 30, 2022.

One customer accounted for 23 % of the Company’s revenue for the year ended June 30, 2021.

Three customers accounted for 18 %, 16 % and 10 % of accounts receivable at June 30, 2022.

No customers accounted for more than 10% of accounts receivable at June 30, 2021.

For the year ended June 30, 2022, the two largest vendors provided 18 % and 13 %, respectively, of the Company’s purchases.

For the year ended June 30, 2021, the two largest vendors provided 17 % and 14 %, respectively, of the Company’s purchases.

At June 30, 2021, the two largest vendors accounted for 28 % and 13 % of the accounts payable balance.

One vendor accounted for 39 % of accounts payable at June 30, 2022.

MOVING IMAGE TECHNOLOGIES, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 — COMMITMENTS AND CONTINGENCIES

Future minimum lease payments at June 30,

2021 under these arrangements are as follows:

Operating Leases:

The Company occupies an executive office and warehouse space in Fountain Valley, CA, pursuant to separate lease agreements.

The aggregate rent expense was $ 281,000 in 2022 and $ 281,000 in 2021.

In September 2018, the Company reached an agreement to extend the executive office lease effective February 1, 2019 by an additional five years .

The monthly rent payable for the first year of the extended term was $ 120,620 and increases by 3 % on each anniversary date.

In April 2020, the Company reached an agreement whereby April, May and June 2020 monthly rent payments related to this lease in the amount of $ 19,500 were deferred but payable in six monthly installments of $ 3,250 commencing on the first day of July 2020.

In addition, the term of the lease was extended for one year from the anniversary date, through January 2025.

Also, in September 2018, the Company reached an agreement to extend the warehouse lease effective February 1, 2019 by an additional five years .

The monthly rent payable for the first year of the extended term was $ 9,465 and increases by 3 % on each anniversary date.

In April 2020, the Company reached an agreement whereby April, May and June 2020 monthly rent payments in the amount of $ 14,624 were deferred but payable in six monthly installments of $ 2,437 commencing on the first day of July 2020.

In addition, the term of the lease was extended for one year from the anniversary date, through January 2025.

Future minimum lease payments at June 30, 2022 under these arrangements are as follows:

(in thousands)

Operating leases

Total future minimum lease payments

1 unchanged sentence

From time to time, the Company is involved in routine litigation that arises in the ordinary course of business.

There are no pending

significant legal proceedings to which the Company is a party for which management believes the ultimate outcome would have a material

adverse effect on the Company’s financial position.

NOTE 10 — PRO FORMA INCOME TAXES

AND INCOME PER SHARE (Unaudited)

Immediately prior

to the effectiveness of the Company’s registration statement on Form S-1, the Company converted into a Delaware C-corporation and

is subject to federal and state income taxes.

Accordingly, a pro forma income tax provision has been disclosed as if the Company was a

corporation for all periods presented.

For the purposes of the pro forma tax provision, we have applied a 28% combined federal and state

A pro forma net

loss or income per common share has been disclosed for the years ended June 30, 2021 and 2020, assuming that an appropriate exchange ratio

will be used to exchange the Class B Membership Interests for shares of common stock at the time of the proposed initial public offering

such that the number of shares of common stock outstanding on a basic basis will be 5,666,667 on and immediately prior to the effective

date of the offering, and 5,750,333 immediately prior to the closing date of the offering.

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 — ACQUISITION

July 28, 2019, the Company completed the acquisition of Caddy.

Caddy designs, manufactures and distributes patented cup

holders, trays, advertising displays and theater step and aisle lighting.

Caddy products are utilized in many facilities throughout more

than 91 countries worldwide.

Its markets include the cinema, sports stadiums, grocery, performing arts, worship and retail industries.

Caddy was acquired for an aggregate purchase price of $2.013 million, consisting of a $0.377 million Closing Promissory Note, a $1.178

million Promissory Note, a $0.2 million Indemnity Promissory Note and contingent consideration valued at $0.15 million, and the assumption

of $0.108 million of liabilities as of the opening balance sheet date.

The contingent consideration is based on the achievement of financial

objectives during the 12-month period following the close of the transaction which expired in July 2020.

The following table summarizes

(in thousands) the fair value of the consideration transferred or to be transferred, to acquire Caddy:

(in thousands)

Notes issued for the acquisition

Liabilities assumed

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 — ACQUISITION (continued)

As this acquisition

was effective on July 28, 2019, the results of operations of Caddy are included in the consolidated financial statements for the period

beginning July 29, 2019.

The transaction

has been accounted for using the acquisition method of accounting.

This method requires that assets acquired and liabilities assumed in

a business combination be recognized at their fair values as of the acquisition date.

The excess of the purchase price over the net assets

acquired was recorded as goodwill.

The following

table summarizes (in thousands) the purchase price allocation for the acquisition:

Accounts receivable and other assets

Property plant and equipment, net

Customer relationships

Total identifiable assets acquired

Net assets acquired

The estimated

fair value of the patents and trademark intangible assets was determined using the “relief from royalty method” under the

income approach, which is a valuation technique that provides an estimate of the fair value of an asset based on the cost savings that

are available through ownership of the asset by the avoidance of paying royalties to license the use of the assets from another owner.

The estimated fair value of the customer relationships was determined using the “excess earnings method” under the income

approach, which represents the total income to be generated by the asset.

Some of the more significant assumptions inherent in the development

of these asset valuations include the projected revenue associated with the asset, the appropriate discount rate to select in order to

measure the risk inherent in each future cash flow stream, the assessment of each asset’s life cycle, as well as other factors.

The discount rate used to arrive at the present value of the customer relationships, and trademarks and patents, at the acquisition date,

The remaining useful lives of the trademark was based on its level of recognition in the marketplace as a market leader for

cupholders and a market participant’s use of these intangible assets and the pattern of projected economic benefit of these intangible

The remaining useful lives of customer relationships were based on the customer attrition and the projected economic benefit of

these clients.

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 11 — ACQUISITION

The estimated

fair value of the contingent consideration was determined based on the Company’s estimates using the probability-weighted gross

profit approach.

The fair value of the contingent consideration as of September 30, 2019 was $0.15 million and the Company has recorded

this amount in liabilities on the financial statements.

Any subsequent changes in the fair value of the contingent consideration obligations

will be recorded in the consolidated statements of operations.

The criteria were not met and no money has been paid.

assigned to customer relationships and trademark are amortized over the estimated useful life of 11 years and 20 years, respectively.

The weighted average life over which these acquired intangibles will be amortized is approximately 15 years.

Pro forma Financial Information (UNAUDITED):

The pro forma results presented below include

the effects of the Company’s acquisition on July 28, 2019 as if it occurred on July 1, 2019.

Year ended June 30,

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 — FAIR VALUE MEASUREMENTS

Assets and Liabilities Measured at Fair

Value on a Recurring Basis

Our liabilities measured

at fair value on a recurring basis consisted of the following as of June 30, 2020:

June 30, 2020

Fair Value Hierarchy Category

(in thousands)

Contingent consideration –

business combinations

Total Liabilities

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 — FAIR VALUE MEASUREMENTS

Assets and Liabilities Measured at Fair

Value on a Recurring Basis (continued)

The following table represents

the changes in the estimated fair value of our liabilities for contingent consideration measured using significant unobservable inputs

(Level 3) for the year ended June 30, 2020:

(in thousands)

June 30, 2020

Fair value measurement at beginning of period

Contingent consideration liabilities recorded for business combinations, including measurement period adjustments

Changes in fair values, recorded in operating expenses

Payments of contingent consideration

Fair value measurement at end of period

IMAGE TECHNOLOGIES, LLC

CONSOLIDATED FINANCIAL STATEMENTS

NOTE 12 — FAIR VALUE MEASUREMENTS

Our estimated liability

for contingent consideration represents potential payments of additional consideration for business combinations, payable if certain defined

performance goals are achieved.

Changes in the fair value of contingent consideration are recorded in the consolidated statements of operations

within selling, general and administrative expenses.

Consideration – Business Combinations - The fair value of the contingent consideration related to business combinations is

estimated using probability-weighted gross profit approach.

These fair value measurements are based on significant inputs not

observable in the market.

The key internally developed assumptions used in these models is consideration at each reporting period,

and any changes in the fair value resulting from either the passage of time or events occurring after the acquisition date, such as

changes in the expectations of achieving the performance targets, are recorded within selling, general, and administrative

Other Financial Instruments - The

carrying amounts of accounts receivable, accounts payable, and notes payable approximate fair value due to their short maturities.

Assets and Liabilities Not Measured

- In addition to assets and liabilities that are measured at fair value on a recurring basis, we also measure certain assets and liabilities

at fair value on a nonrecurring basis.

Our non-financial assets, including goodwill, intangible assets and property, plant and equipment,

are measured at fair value when there is an indication of impairment and the carrying amount exceeds the asset’s projected undiscounted

These assets are recorded at fair value only when an impairment charge is recognized.

Pursuant to the requirements

of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its

behalf by the undersigned, thereunto duly authorized, in the City of Fountain Valley, State of California, on September 29,

There are no pending significant legal proceedings to which the Company is a party for which management believes the ultimate outcome would have a material adverse effect on the Company’s financial position.

NOTE 13 — SUBSEQUENT EVENTS

On July 21, 2022, the Company granted 130,000 shares of common stock, with a fair market value of approximately $ 169,000 , to employees as compensation for previously provided services and was accrued as of June 30, 2022.

On August 12, 2022, the Company filed a Form S-8 with the SEC registering an additional 750,000 Shares for stock-based awards available for issuance under the Company’s 2019 Omnibus Incentive Plan.

The Company has evaluated events from June 30, 2022 through September 28, 2022, the date these consolidated financial statements were available to be issued.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Fountain Valley, State of California, on September 28, 2022.

Moving iMage Technologies, Inc.

/s/ Phil Rafnson

President and Chief Executive

President and Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE

PRESENTS, that each person whose signature appears below constitutes and appoints Phil Rafnson and Michael Sherman, jointly and severally,

his or her attorney-in-fact, each with the full power of substitution, for such person, in any and all capacities, to sign any and all

amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto and other documents in connection

therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and

perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes

as he or she might do or could do in person hereby ratifying and confirming all that each of said attorneys-in-fact and agents, or his

or her substitute, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities

Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated

and on the dates indicated.

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Phil Rafnson and Michael Sherman, jointly and severally, his or her attorney-in-fact, each with the full power of substitution, for such person, in any and all capacities, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might do or could do in person hereby ratifying and confirming all that each of said attorneys-in-fact and agents, or his or her substitute, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated and on the dates indicated.

Name and Signature

20 unchanged sentences

Exhibit Description

Agreement dated July 7, 2021 between Moving iMage Technologies, Inc.

and Boustead Securities, LLC, as representative of the

underwriters named therein

of Incorporation, as amended

Common Stock Certificate

Representative’s

Warrant dated July 12, 2021

Services Agreement dated October 3, 2018 between the Company and Caddy Products, Inc.

Indemnity Agreement between the Company and its directors and officers

Certificate of Incorporation, as amended

Form of Common Stock Certificate

Management Services Agreement dated October 3, 2018 between the Company and Caddy Products, Inc.

Form of Indemnity Agreement between the Company and its directors and officers

2019 Omnibus Incentive Plan

Stock Option Award Agreement

Restricted Stock Award Agreement

Restricted Stock Unit Agreement

Sheet dated July 24, 2018 between the Company and Caddy Products, Inc.

and Plan of Merger and Reorganization dated July 3, 2017 among Monster Digital, Inc., the Company and Innovate Biopharmaceuticals, Inc.

Purchase Agreement dated effective as of January 1, 2019 by and among Moving iMage Technologies, LLC, MiT Acquisition Co.

Products, Inc., and the Estate of Peter Bergin

Agreement dated as of October 24, 2019 by and between Agility Capital III, LLC Moving iMage Technologies, LLC and MiT Acquisition

Agreement dated July 7, 2021 among the Company, and the Members of Moving iMage Technologies, LLC

Amendment No.

1 to 2019 Omnibus Incentive Plan

Form of Stock Option Award Agreement

Form of Restricted Stock Award Agreement

Form of Restricted Stock Unit Agreement

Loan Agreement dated as of October 24, 2019 by and between Agility Capital III, LLC Moving iMage Technologies, LLC and MiT Acquisition Co.

Exchange Agreement dated July 7, 2021 among the Company, and the Members of Moving iMage Technologies, LLC

Asset Purchase Agreement dated April 21, 2022 between Moving iMage Technologies, Inc.

List of Subsidiaries

Consent of CohnReznick

Consent of Haskell & White LLP

Consent of CohnReznick LLP

Power of Attorney (included on signature page)

Certification of

the Principal Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934.

Certification of

the Principal Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934.

Certification of

the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906

of the Sarbanes-Oxley Act of 2002.

Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934.

Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934.

Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

The following financial statements from the Company’s Report on Form 10-K for the year ended June 30, 2022, formatted in Inline XBRL:

(i) Condensed Consolidated Statements of Cash Flows, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Balance Sheets, and (iv) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags.

Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit 101).

Compensatory plan or arrangement

* Form 8-K filed by 9 Meters Biopharma, Inc.( formerly Innovate

Biopharmaceuticals, Inc.

and formerly Monster Digital, Inc.).

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 9A. Controls and Procedures