What changed in this filing

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Item 9A. Controls and Procedures

2021-09-29 compared with 2020-10-13 · 1440 added, 1464 removed, 438 unchanged (87% of the section changed)

Controls and Procedures

Management’s

Annual Report on Internal Control over Financial Reporting

Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting

as defined in Rule 13a-15(f) under the Securities and Exchange Act of 1934, as amended.

The Company’s internal control over

financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation

of financial statements for external purposes in accordance with generally accepted accounting principles.

The Company’s

internal control over financial reporting includes those policies and procedures that:

Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting as defined

in Rule 13a-15(f) under the Securities and Exchange Act of 1934, as amended.

The Company’s internal control over financial reporting

is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements

for external purposes in accordance with generally accepted accounting principles.

The Company’s internal control over financial

reporting includes those policies and procedures that:

to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the

Company’s assets;

reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with

GAAP, and that the Company’s receipts and expenditures are being made only in accordance with the authorization of

its management and directors;

reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s

GAAP, and that the Company’s receipts and expenditures are being made only in accordance with the authorization of its

management and directors;

reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s

assets that could have a material effect on the financial statements.

of June 30, 2020, the Company carried out an evaluation, under the supervision of and with the participation of its management,

including the Company’s Chief Executive Officer and Acting Chief Financial Officer, of the effectiveness of the design and

operation of the Company’s disclosure controls and procedures.

Based on the foregoing evaluation, Chief Executive Officer

and Acting Chief Financial Officer concluded that the Company’s disclosure controls and procedures (as defined in Rules

13a-15(e) and 15d-15(e) under the Exchange Act were not effective to ensure that the information required to be disclosed by the

Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time

periods specified in the applicable rules and forms due to ineffective internal controls over financial reporting that stemmed

from the following material weaknesses for the year ended and as of June 30, 2020:

● Lack of segregation of duties for accounting personnel who prepared and reviewed the journal entries in some of the subsidiaries within

the consolidation, lack of supervision, coordination and communication of financial information between different entities within the

As of June 30, 2021, the Company carried out an evaluation, under the

supervision of and with the participation of its management, including the Company’s Chief Executive Officer and Acting Chief Financial

Officer, of the effectiveness of the design and operation of the Company’s disclosure controls and procedures.

Based on the foregoing

evaluation, Chief Executive Officer and Acting Chief Financial Officer concluded that the Company’s disclosure controls and procedures

(as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act were not effective to ensure that the information required to be disclosed

by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time

periods specified in the applicable rules and forms due to ineffective internal controls over financial reporting that stemmed from the

following material weaknesses for the year ended and as of June 30, 2021:

of segregation of duties for accounting personnel who prepared and reviewed the journal entries in some of the subsidiaries within

the consolidation, lack of supervision, coordination and communication of financial information between different entities within

of a full time U.S.

GAAP personnel in the accounting department to monitor the recording of the transactions;

● Lack of the review and supervision procedures on issuance of the Company's common stock;

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

of management control reviews of the budget against actual with analysis of the variance with a precision that can be explained

through the analysis of the accounts.

material weakness is a deficiency, or a combination of deficiencies, within the meaning of PCAOB Auditing Standard AS 2201, 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.

order to remediate the material weaknesses stated above, we intend to explore implementing additional policies and procedures,

which may include:

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

the analysis of the accounts.

material weakness is a deficiency, or a combination of deficiencies, within the meaning of PCAOB Auditing Standard AS 2201, 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.

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

additional accounting staff to report the internal financial timely;

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issues in non-routine or complex transactions;

internal audit function, internal control policies and monitoring controls including but not limit to the review and supervision of common stock issuance procedures;

internal audit function, internal control policies and monitoring controls including but not limit to the review and supervision

of common stock issuance procedures;

and conducting U.S.

GAAP knowledge, SEC reporting and internal control training to senior executives, management personnel, accounting

departments and the IT staff, so that management and key personnel understand the requirements and elements of internal control

over financial reporting mandated by the U.S.

departments and the IT staff, so that management and key personnel understand the requirements and elements of internal control over

financial reporting mandated by the U.S.

securities laws;

up budgets and developing expectations based on understanding of the business operations, compare the actual results with the

expectations periodically and document the reasons of the fluctuations with further analysis.

This should be done by CFO and reviewed

by CEO, communicated with the Board.

up budgets and developing expectations based on understanding of the business operations, compare the actual results with the expectations

periodically and document the reasons of the fluctuations with further analysis.

This should be done by CFO and reviewed by CEO,

communicated with the Board.

in Internal Control over Financial Reporting

has been no change in our internal control over financial reporting that occurred during the fourth quarter of the year ended

June 30, 2020 that has materially affected, or is reasonably likely to materially affect, our internal control over financial

There has been no change in our internal control over financial reporting

that occurred during the year ended June 30, 2021 that has materially affected, or is reasonably likely to materially affect,

our internal control over financial reporting.

Other Information.

2 unchanged sentences

Cao is our Chief Executive Officer and a Director.

Cao founded our company in 2001 and has been the Chief Executive Officer

since that time.

Cao founded our company in 2001 and has been the Chief Executive Officer since

Cao has been Chief Executive officer of our company since its formation.

Prior to founding our company, Mr.

Cao was a Chief Representative of Wagenborg-Lagenduk Scheepvaart BV, Holland, from 1992 to 1993, Director of the Penavico-Beijing’s

shipping agency from 1987 through 1992, and a seaman for Cosco-Hong Kong from 1984 through 1987.

Cao received his EMBA degree

in 2009 from Shanghai Jiao Tong University.

Cao was chosen as a director because he is the founder of our company and we believe

his knowledge of our company and years of experience in our industry give him the ability to guide our Company as a director.

Chief Representative of Wagenborg-Lagenduk Scheepvaart BV, Holland, from 1992 to 1993, Director of the Penavico-Beijing’s shipping

agency from 1987 through 1992, and a seaman for Cosco-Hong Kong from 1984 through 1987.

Cao received his EMBA degree in 2009 from

Shanghai Jiao Tong University.

Cao was chosen as a director because he is the founder of our company and we believe his knowledge

of our company and years of experience in our industry give him the ability to guide our Company as a director.

Wang currently serves as Chief Economist to China Minsheng Banking Corp., Ltd.

and has held this position since December 2002.

Wang was a Chinese Project Advisor for the World Bank from 1990 until 1994.

was a Chinese Project Advisor for the World Bank from 1990 until 1994.

From 1998 through 2000, Mr.

Wang was the vice

director of Tianjin Security and Futures Supervision Office, in charge of initial public offerings and listing companies.

Wang is an independent director for Tianjin Binhai Energy & Development Co.

Wang was the vice director of Tianjin

Security and Futures Supervision Office, in charge of initial public offerings and listing companies.

Wang is an independent director

for Tianjin Binhai Energy & Development Co.

Ltd., (Shenzhen Stock Exchange:

Marine Shipping Co., Ltd.

(Shanghai Stock Exchange:

Tianjin Marine Shipping Co., Ltd.

Stock Exchange:

600751), and ReneSola Company (London Stock Exchange:

Wang received

a Bachelor degree in Economics from Tianjin University of Finance and Economics.

Wang received a Bachelor degree in Economics from Tianjin

University of Finance and Economics.

The Board believes that Mr.

Wang’s economics

background and experience working with public companies qualify him to serve a director of the Company.

Wang’s economics background and experience working with public

companies qualify him to serve a director of the Company.

Liu currently serves as the vice president in charge of accounting and finance to China Sun-Trust Group Ltd.

and has held this

position since 2001.

and has held this position

Liu was a financial controller for Huaxing Group Ltd from 1998 to 2001.

From 1996 through 1998, he was

the chief accountant of China Enterprise Consulting Co., Ltd.

From 1996 through 1998, he was the chief accountant

of China Enterprise Consulting Co., Ltd.

Before working in industry, Dr.

Liu taught accounting and finance

in a university for more than ten years and has published dozens of books and articles.

Liu taught accounting and finance in a university for more than

ten years and has published dozens of books and articles.

Liu is a CPA in China.

a PhD, master’s and bachelor’s degrees from Tianjin University of Finance and Economics.

Liu has been chosen to

serve as a director because of his accounting and business knowledge and experience in working with small and medium-sized companies.

February 26, Mr.

Junfeng Xu was appointed as a Class I director, Chairperson of the Corporate Governance Committee, a member of

the Audit Committee and a member of the Compensation Committee.

Xu is an experienced securities attorney in China, bringing

over 20 years of legal experience in the securities law and investment banking law industry, having advised various companies

in their public offerings and mergers and acquisitions.

He is one of the founding partners of Beijing Junzejun Law Offices.

Xu currently works at Beijing Huatang Law Firm, and is a director of Jessn Marine Equipment Co., Ltd.

He used to serve as an independent

director on the board of directors of various public and private companies in China.

He was also a partner and the general investment

director at two private equity fund management companies.

Xu also teaches at the PE Executive programs of Tsinghua University,

Inner Mongolia University and Guangzhou Jinan University.

Xu received his Bachelor of Laws and Master of Laws from China University

of Political Science and Law in 1985 and 1988, respectively.

Operating Officer and Director

Huang has been our Chief Operating Officer since 2010 and a Class I director since 2015.

Prior to 2010, he served as Director

of Sino-Global Shipping Australia, for which he was responsible for regional operations, marketing and regulation oversight.

2006 through 2010, Mr.

Huang served as our Company’s Vice President, with duties focused on company operation and strategy,

international shipping and marketing.

He received a PhD, master’s and bachelor’s

degrees from Tianjin University of Finance and Economics.

Liu has been chosen to serve as a director because of his accounting and

business knowledge and experience in working with small and medium-sized companies.

Huang is presently Vice President of SOS Information Technology New York, Inc.

Prior to that, Ms.

Huang had been Vice President for China

Commercial Credit, Inc.

from November 2016 to July 2020, President of Shenzhen Yi Le Gou Mobile Internet Co., Ltd since February 2014

and a Consultant till present, Vice President of Shenzhen Hang Lu Technology Co., Ltd from March 2009 to February 2014 and Channel Manager

from August 2007 to March 2009.

Huang holds a Bachelor’s degree in Business Management from Hunan Normal University.

was chosen as a director because of her management skills with companies.

Huang has been our Vice President – Operations since January 28, 2021 and a Class I director since 2015.

Prior to that, Mr.

had been our Chief Operating Officer since 2010.

Prior to 2010, he served as Director of Sino-Global Shipping Australia, for which he

was responsible for regional operations, marketing and regulation oversight.

From 2006 through 2010, Mr.

Huang served as our Company’s Operations Manager, and

from 2002 through 2004, he served as an operator with our Company.

Huang obtained his degree in English from Guangxi University

Huang served as our Company’s

Vice President, with duties focused on company operation and strategy, international shipping and marketing.

From 2004 through 2006,

Huang served as our Company’s Operations Manager, and from 2002 through 2004, he served as an operator with our Company.

Huang obtained his degree in English from Guangxi University in 1999.

Chief Financial Officer

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Since 2008, Ms.

has overseen the finance and accounting functions of Sino-Global Shipping Australia Pty Ltd.

Pan received her bachelor’s

degree in Accounting and Finance and a master’s degree in Advance Accounting from the Curtin University of Technology in

Western Australia.

From August 2007 to July 2008, Ms.

Pan worked as an auditor and project manager of Baker Tilly China Ltd.,

and participated in various projects from e-Future Information Technology Inc., TMC Education Corporation Ltd, to China Ministry

of Commerce, among others.

Pan has overseen

the finance and accounting functions of Sino-Global Shipping Australia Pty Ltd.

Pan received her bachelor’s degree in Accounting

and Finance and a master’s degree in Advance Accounting from the Curtin University of Technology in Western Australia.

2007 to July 2008, Ms.

Pan worked as an auditor and project manager of Baker Tilly China Ltd., and participated in various projects from

e-Future Information Technology Inc., TMC Education Corporation Ltd, to China Ministry of Commerce, among others.

Operating Officer

Shan has been our Chief Operating Officer since her appointment on August 5, 2021.

From July 2019 to July 2021, Ms.

Shan was a financial

representative at Northwestern Mutual.

Prior to that, she was a COO and PR specialist at LineMony Inc.

from December 2016 to July 2019.

From August 2016 to December 2016, she was an analyst at Wall Street IPO Consultation Inc.

Technology Officer

You has more than twenty years of experience in semiconductors and intelligent hardware, cryptocurrency mining server design and ecology.

From 2011 to 2020, Mr.

You was the Chief Executive Officer of Shenzhen Rayshine Technology and Shenzhen Ethermicro Technology, two companies

focused in the cryptocurrency industry.

You has assisted with the development and establishment of Bitmain’s factory in Shenzhen,

and his businesses have been strategic suppliers of Bitmain.

in Certain Legal Proceedings

the best of our knowledge, none of our directors or executive officers has been convicted in a criminal proceeding, excluding

traffic violations or similar misdemeanors, or has been a party to any judicial or administrative proceeding during the past ten

years that resulted in a judgment, decree or final order enjoining the person from future violations of, or prohibiting activities

subject to, federal or state securities laws, or a finding of any violation of federal or state securities or commodities laws,

any laws respecting financial institutions or insurance companies, any law or regulation prohibiting mail or wire fraud in connection

with any business entity or been subject to any disciplinary sanctions or orders imposed by a stock, commodities or derivatives

exchange or other self-regulatory organization, except for matters that were dismissed without sanction or settlement.

our directors, director nominees or executive officers has been involved in any transactions with us or any of our directors,

executive officers, affiliates or associates which are required to be disclosed pursuant to the rules and regulations of the Commission.

the best of our knowledge, none of our directors or executive officers has been convicted in a criminal proceeding, excluding traffic

violations or similar misdemeanors, or has been a party to any judicial or administrative proceeding during the past ten years that resulted

in a judgment, decree or final order enjoining the person from future violations of, or prohibiting activities subject to, federal or

state securities laws, or a finding of any violation of federal or state securities or commodities laws, any laws respecting financial

institutions or insurance companies, any law or regulation prohibiting mail or wire fraud in connection with any business entity or been

subject to any disciplinary sanctions or orders imposed by a stock, commodities or derivatives exchange or other self-regulatory organization,

except for matters that were dismissed without sanction or settlement.

None of our directors, director nominees or executive officers

has been involved in any transactions with us or any of our directors, executive officers, affiliates or associates which are required

to be disclosed pursuant to the rules and regulations of the Commission.

Leadership Structure

Lei Cao currently holds both the positions of Chief Executive Officer and Chairman of the Board.

These two positions have not

been consolidated into one position;

These two positions have not been consolidated

into one position;

Cao simply holds both positions at this time.

The Board of Directors believes that Mr.

Cao’s service as both Chief Executive Officer and Chairman of the Board is in the best interests of the Company and its

shareholders.

Cao possesses detailed and in-depth knowledge of the issues, opportunities and challenges facing the Company

and its business and is thus best positioned to develop agendas that ensure that the Board’s time and attention are focused

on the most critical matters.

His combined role enables decisive leadership, ensures clear accountability, and enhances the Company’s

ability to communicate its message and strategy clearly and consistently to the Company’s shareholders, employees, customers

and suppliers.

do not have a lead independent director because we believe our independent directors are encouraged to freely voice their opinions

on a relatively small company board.

Cao’s service as

both Chief Executive Officer and Chairman of the Board is in the best interests of the Company and its shareholders.

Cao possesses

detailed and in-depth knowledge of the issues, opportunities and challenges facing the Company and its business and is thus best positioned

to develop agendas that ensure that the Board’s time and attention are focused on the most critical matters.

His combined role

enables decisive leadership, ensures clear accountability, and enhances the Company’s ability to communicate its message and strategy

clearly and consistently to the Company’s shareholders, employees, customers and suppliers.

do not have a lead independent director because we believe our independent directors are encouraged to freely voice their opinions on

a relatively small company board.

We believe this leadership structure is appropriate because we are a smaller reporting company;

as such, we deem it appropriate to be able to benefit from the guidance of Mr.

Cao as both our Chief Executive Officer and Chairman

of the Board.

such, we deem it appropriate to be able to benefit from the guidance of Mr.

Cao as both our Chief Executive Officer and Chairman of the

Board of Directors plays a significant role in our risk oversight.

The Board of Directors makes all relevant Company decisions.

As such, it is important for us to have our Chief Executive Officer serve on the Board as he plays a key role in the risk oversight

of the Company.

As a smaller reporting company with a small board of directors, we believe it is appropriate to have the involvement

and input of all of our directors in risk oversight matters.

it is important for us to have our Chief Executive Officer serve on the Board as he plays a key role in the risk oversight of the Company.

As a smaller reporting company with a small board of directors, we believe it is appropriate to have the involvement and input of all

of our directors in risk oversight matters.

16(a) Beneficial Ownership Reporting Compliance (Regulation S-K Item 405)

1 unchanged sentence

class of our equity securities, file reports of ownership and changes in ownership with the SEC.

Executive officers, directors

and greater-than-ten percent stockholders are required by SEC regulations to furnish us with all Section 16(a) forms they file.

Based solely on our review of the copies of the forms received by us and written representations from certain reporting persons

that they have complied with the relevant filing requirements, we believe that, during the year ended June 30, 2020, all of our

executive officers, directors and greater-than-ten percent stockholders complied with all Section 16(a) filing requirements, except

that, due to administrative error, the following form was filed late:

Pan filed a Form 4 on July 7, 2020 to report transactions that occurred on June 30, 2020.

Executive officers, directors and greater-than-ten

percent stockholders are required by SEC regulations to furnish us with all Section 16(a) forms they file.

Based solely on our review

of the copies of the forms received by us and written representations from certain reporting persons that they have complied with the

relevant filing requirements, we believe that, during the year ended June 30, 2020, all of our executive officers, directors and greater-than-ten

percent stockholders complied with all Section 16(a) filing requirements, except that, due to administrative errors, the following forms

were filed late:

Pan filed a Form 4 on August 19, 2021 to report transactions that occurred on August 13, 2021.

Nie filed a Form 4 on August 20, 2021 to report transactions that occurred on August 13, 2021.

Liu filed a Form 4 on August 19, 2021 to report transactions that occurred on August 13, 2021.

Huang filed a Form 4 on August 19, 2021 to report transactions that occurred on August 13, 2021.

Zhikang Huang filed a Form 4 on August 19, 2021 to report transactions that occurred on August 13, 2021.

Wang filed a Form 4 on August 19, 2021 to report transactions that occurred on August 13, 2021.

Cao filed a Form 4 on August 19, 2021 to report transactions that occurred on August 13, 2021.

Company has adopted a Code of Ethics and has filed a copy of the Code of Ethics with the Commission.

A copy of the Code of Ethics

is also available from the Company’s website (www.sino-global.com) or directly at the following link:

A copy of the Code of Ethics is

also available from the Company’s website (www.sino-global.com) or directly at the following link:

https://s25.q4cdn.com/592081264/files/doc_governance/Code-of-Business-Conduct-and-Ethics.pdf.

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S-K Item 407(d)(4) and (5)

Company has an audit committee, consisting solely of the Company’s independent directors, Tieliang Liu, Jing Wang and Junfeng

Company has an audit committee, consisting solely of the Company’s independent directors, Tieliang Liu, Jing Wang and Xiaohuan

Huang, and Jing Shang.

Liu qualifies as the audit committee financial expert.

The Company’s audit committee charter is available

on the Company’s website (www.sino-global.com) or directly at the following link:

The Company’s audit committee charter is available

on the Company’s website (www.sino-global.com) or directly at the following link:

https://s25.q4cdn.com/592081264/files/doc_governance/Audit-Committee-Charter.pdf.

Executive Compensation.

following table shows the annual compensation paid by us to Mr.

Lei Cao, our Principal Executive Officer, Ms.

The following table shows

the annual compensation paid by us to Mr.

Lei Cao, our Chief Executive Officer (Principal Executive Officer), Ms.

Tuo Pan, our Acting

Chief Financial Officer, and Mr.

Zhikang Huang, our Chief Operating Officer, for the years ended June 30, 2020 and 2019.

officer had total compensation during either of the previous two years of more than $100,000.

Compensation Table

$ 180,000 (1)

Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer), and Mr.

Zhikang Huang, our Vice President, for

the years ended June 30, 2021 and 2020.

Chief Executive Officer

(Principal Executive Officer)

$ 135,000 (1)

Acting Chief Financial Officer

(Principal Financial Officer and Principal Accounting Officer)

Zhikang Huang,

$ 100,000 (3)

Chief Operating Officer

Vice President and Director

(1) According

to the Employment Agreement dated January 1, 2019, Mr.

Cao’s annual salary shall be $260,000, effective January 1, 2019.

The executive reserves his right for the remaining unpaid salary of (a) $40,000 from January 1, 2019 to June 30, 2019 and (b)

$125,000 for fiscal year 2020 under such agreement.

Such unpaid amount accrues without interest and will be paid at such time

as the Company has sufficient funds.

Cao’s annual salary shall be

$260,000, effective January 1, 2019.

(2) According

to the Employment Agreement dated January 1, 2019, Ms.

Pan’s annual salary shall be $100,000, effective January 1, 2019.

The executive reserves her right for the remaining unpaid salary of (a) $20,000 from January 1, 2019 to June 30, 2019 and (b)

$55,000 for fiscal year 2020 under such agreement.

Such unpaid amount accrues without interest and will be paid at such time as

the Company has sufficient funds.

Pan’s annual salary shall be

$100,000, effective January 1, 2019.

(3) According

to the Employment Agreement dated January 1, 2019, Mr.

Huang’s annual salary shall be $150,000, effective January 1, 2019.

The executive reserves his right for the remaining unpaid salary of (a) $25,000 from January 1, 2019 to June 30, 2019 and (b)

$75,000 for fiscal year 2020 under such agreement.

Such unpaid amount accrues without interest and will be paid at such time as

the Company has sufficient funds.

Huang’s annual salary shall

be $150,000, effective January 1, 2019.

Equity Awards of Named Executive Officers at Fiscal Year-End

of June 30, 2020, we had three named executive officers, Mr.

As of June 30, 2021, we had

four named executive officers, Mr.

Lei Cao, our Chief Executive Officer, Ms.

Tuo Pan, our Acting Chief

Financial Officer, and Mr.

Zhikang Huang, our Chief Operating Officer.

incentive plan

unexercisable

Principal Executive Officer

Acting Chief Financial Officer

Tuo Pan, our Chief Financial Officer, Ms.

Jing Shan, our

Chief Operating Officer, and Mr.

Xintang You, our Chief Technology Officer.

On August 13, 2021, the Board of Directors and the Compensation Committee

of the Board approved a one-time award of a total of 1,020,000 shares of the common stock from the shares reserved under the Company’s

2014 Stock Incentive Plan (the “Plan”) to the officers, including Chief Executive Officer, Lei Cao, Acting Chief Financial

Officer, Tuo Pan, and the following members of the Board for their valuable contributions to the Company in fiscal 2021:

Zhikang Huang,

Chief Operating Officer

Jing Wang, Xiaohuan Huang and Tieliang Liu, effective August 13, 2021.

made the following stock grants under the Plan:

(i) Chief Executive Officer, Lei Cao, a one-time stock award grant of 600,000 shares,

(ii) acting Chief Financial Officer, Tuo Pan, a one-time stock award grant of 200,000 shares, (iii) Board member, Zhikang Huang, a one-time

stock award grant of 160,000 shares, (iv) Board member, Jing Wang, a one-time stock award grant of 20,000 shares, (v) Board member, Xiaohuan

Huang, a one-time stock award grant of 20,000 shares, and (vi) Board member, Tieliang Liu, a one-time stock award grant of 20,000 shares.

unexercisable

Executive Officer

Chief Financial Officer

Operating Officer

Technology Officer

Company has made stock awards to executive officers.

3 unchanged sentences

Fees earned or

Jianming Li (5)

Xiaohuan Huang (2)

Junfeng Xu (3)

table does not include Mr.

1 unchanged sentence

Cao is a director and named executive officer,

Cao’s compensation is fully reflected in the Summary Compensation Table.

Li was replaced from the Board on December 27, 2019.

Agreements with the Company’s Named Executive Officers

has employment agreements with each of Mr.

Tuo Pan and Mr.

Zhikang Huang.

These employment agreements provide for

five-year terms that extend automatically in the absence of termination provided at least 60 days prior to the anniversary date

of the agreement.

If we fail to provide this notice or if we wish to terminate an employment agreement in the absence of cause,

then we are obligated to provide at least 30 days’

prior notice.

In such case during the initial term of the agreement,

we would need to pay such executive (i) the remaining salary through December 31, 2023, (ii) two times of the then applicable

annual salary if there has been no Change in Control, as defined in the employment agreements or three-and-half times of the then

applicable annual salary if there is a Change in Control.

are, however, permitted to terminate an employee for cause without penalty to our company, where the employee has committed a

crime or the employee’s actions or inactions have resulted in a material adverse effect to us.

Cao’s compensation is fully reflected in the Summary Compensation Table.

This table does not include Mr.

Zhikang Huang, our Vice President, because although Mr.

Huang is a director and

named executive officer, Mr.

Huang’s compensation is fully reflected in the Summary Compensation Table.

Huang joined the Board of Directors on October 19, 2020.

Xu resigned from the Board of Directors on October 19, 2020.

Agreements with the Company’s Named Executive Officers

Sino-China has employment

agreements with each of Mr.

Tuo Pan, Xintang You, Lie Nie, Zhikang Huang, and Jing Shan.

The employment agreements for Mr.

Lei Cao and Ms.

Tuo Pan provide for five-year terms that extend automatically for one-year period(s) in the absence of termination provided

at least 60 days prior to the anniversary date of the agreement.

If we fail to provide this notice or if we wish to terminate an employment

agreement in the absence of cause, then we are obligated to provide at least 30 days’ prior notice.

In such case during the initial

term of the agreement, we would need to pay such executive (i) the remaining salary through December 31, 2023, (ii) two times of the then

applicable annual salary if there has been no Change in Control, as defined in the employment agreements or three-and-half times of the

then applicable annual salary if there is a Change in Control.

The employment agreements

for Xintang You and Lie Nie provide for five-year terms that extend automatically in the absence of termination provided at least 30 days

prior to the anniversary date of the agreement.

The employment agreement for Zhikang Huang provides for a five-year term that extends

automatically for one-year period in the absence of notice of non-renewal provided at least 60 days prior to the anniversary date of the

The employment agreement for Jing Shan provides for a four-year term that extend automatically in the absence of termination

provided at least 30 days prior to the anniversary date of the agreement.

are, however, permitted to terminate an employee for cause without penalty to our company, where the employee has committed a crime or

the employee’s actions or inactions have resulted in a material adverse effect to us.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

below table reflects, as of June 30, 2021, the number of shares of common stock authorized by our shareholders to be issued (directly

or by way of issuance of securities exercisable for or convertible into) as incentive compensation to our officers, directors,

employees and consultants.

Plan category

Number of securities to be issued upon exercise of outstanding options, warrants and rights

Weighted-average exercise price of outstanding options, warrants and rights

Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))

Equity compensation plans under the 2008 Incentive Plan approved by security holders

Equity compensation plans under the 2014 Incentive Plan approved by security holders

1,244,000 (1)

Equity compensation plans not approved by security holders

to our 2008 Incentive Plan, we are authorized to issue options to purchase 60,581 shares of our common stock.

The 2,000 outstanding

options disclosed in the above table are taken from the 2008 Incentive Plan.

Pursuant to our 2014 Incentive Plan, we are authorized

to issue, in the aggregate, 2,000,000 shares of common stock or other securities convertible or exercisable for common stock.

We have granted options to purchase an aggregate of 30,000 shares of common stock under the 2014 Incentive Plan in July 2016,

among which, options to purchase 15,000 shares of common stock have been exercised.

or by way of issuance of securities exercisable for or convertible into) as incentive compensation to our officers, directors, employees

and consultants.

available for

Equity compensation

plans under the 2008 Incentive Plan approved by security holders

Equity compensation plans

under the 2014 Incentive Plan approved by security holders

Equity compensation plans

under the 2021 Incentive Plan approved by security holders

Equity compensation plans

not approved by security holders

to our 2008 Incentive Plan, we are authorized to issue options to purchase 60,581 shares

of our common stock.

The 2,000 outstanding options disclosed in the above table are taken

from the 2008 Incentive Plan.

Pursuant to our 2014 Incentive Plan, we are authorized to issue,

in the aggregate, 2,000,000 shares of common stock or other securities convertible or exercisable

for common stock.

We have granted options to purchase an aggregate of 30,000 shares of common

stock under the 2014 Incentive Plan in July 2016, among which, options to purchase 15,000

shares of common stock have been exercised.

In addition, we have issued, in the aggregate,

120,000 shares of common stock to consultants to our Company in 2014, 132,000 shares of common stock to our officers and directors

in 2016, 132,000 shares of common stock to our officers and directors in 2018, 26,000 to three employees in 2017 and 316,000 shares

of common stock to employees in 2018 under the 2014 Incentive Plan.

Accordingly, we may issue options to purchase 47,781 shares

under the 2008 Incentive Plan, and we may issue 1,244,000 shares of common stock or other securities convertible or exercisable

for common stock under the 2014 Incentive Plan.

following table sets forth certain information regarding our shares of common stock beneficially owned as of October 13, 2020,

for (i) each stockholder known to be the beneficial owner of 5% or more of the Company’s outstanding shares of common stock,

(ii) each named executive officer and director, and (iii) all executive officers and directors as a group.

A person is considered

to beneficially own any shares:

(i) over which such person, directly or indirectly, exercises sole or shared voting or investment

power, or (ii) of which such person has the right to acquire beneficial ownership at any time within 60 days through an exercise

of stock options or warrants.

Unless otherwise indicated, voting and investment power relating to the shares shown in the table

for our directors and executive officers is exercised solely by the beneficial owner or shared by the owner and the owner’s

spouse or children.

Name and Address

120,000 shares of common stock to consultants to our Company in 2014, 132,000 shares of common

stock to our officers and directors in 2016, 132,000 shares of common stock to our officers

and directors in 2018, 26,000 to three employees in 2017 and 316,000 shares of common stock

to employees in 2018 under the 2014 Incentive Plan.

On September 2021, the board granted 1,020,000 shares of common stock to our officers and directors under the

2014 Incentive Plan.

Accordingly, we may issue options to

purchase 47,781 shares under the 2008 Incentive Plan, and we may issue 110,000 and 10,000,000 shares of

common stock or other securities convertible or exercisable for common stock under the 2014

Incentive Plan and the 2021 Incentive plan respectively.

following table sets forth certain information regarding our shares of common stock beneficially owned as of September 28, 2021, for (i)

each stockholder known to be the beneficial owner of 5% or more of the Company’s outstanding shares of common stock, (ii) each

named executive officer and director, and (iii) all executive officers and directors as a group.

A person is considered to beneficially

own any shares:

(i) over which such person, directly or indirectly, exercises sole or shared voting or investment power, or (ii) of which

such person has the right to acquire beneficial ownership at any time within 60 days through an exercise of stock options or warrants.

Unless otherwise indicated, voting and investment power relating to the shares shown in the table for our directors and executive officers

is exercised solely by the beneficial owner or shared by the owner and the owner’s spouse or children.

Lei Cao (1)(2)

2 unchanged sentences

Liu Tieliang (1)(4)

Total Officers and Directors (6 individuals)

Other Five Percent Shareholders

Shanming Liang (5)

individual’s address is c/o Sino-Global Shipping America, Ltd., 1044 Northern Boulevard, Roslyn, New York 11576-1514.

Cao has received options to purchase 36,000 shares of the Company’s common stock, all of which underlying shares are reflected

in this table because they have fully vested.

Wang has received options to purchase 10,000 shares of the Company’s common stock, all of which underlying shares are reflected

in this table because they have fully vested.

Liu has received options to purchase 10,000 shares of the Company’s common stock, 8,000 of which have fully vested.

Shanming Liang’s address is No.

2 Zhonghua Road, Gangkou District, Fangchenggang City, Guangxi Province, 538001.

Xiaohuan Huang

Total Officers

and Directors (6 individuals)

individual’s address is c/o Sino-Global Shipping America, Ltd., 1044 Northern Boulevard,

Roslyn, New York 11576-1514.

Cao has received options to purchase 36,000 shares of the Company’s common stock, all

of which underlying shares are reflected in this table because they have fully vested.

Wang has received options to purchase 10,000 shares of the Company’s common stock,

all of which underlying shares are reflected in this table because they have fully vested.

Liu has received options to purchase 10,000 shares of the Company’s common stock, 8,000

of which have fully vested.

Certain Relationships and Related Transactions, and Director Independence.

1 unchanged sentence

provided by NASDAQ Stock Market Rule 4200(a)(15).

Other than as described herein, no transactions required to be disclosed

under Item 404 of Regulation S-K have occurred since the beginning of the Company’s last fiscal year.

Other than as described herein, no transactions required to be disclosed under Item

404 of Regulation S-K have occurred since the beginning of the Company’s last fiscal year.

June 2013, the Company signed a five-year global logistic service agreement with Tianjin Zhiyuan Investment Group Co., Ltd.

“Zhiyuan Investment Group”) and TEWOO Chemical & Light Industry Zhiyuan Trade Co., Ltd.

(together with Zhiyuan

Investment Group, “Zhiyuan”).

(the “Zhiyuan

Investment Group”) and TEWOO Chemical & Light Industry Zhiyuan Trade Co., Ltd.

(together with Zhiyuan Investment Group, “Zhiyuan”).

Zhiyuan Investment Group is owned by Mr.

Zhang, a large shareholder of the Company.

In September 2013, the Company executed an inland transportation management service contract with Zhiyuan Investment Group whereby

it would provide certain advisory services and help control potential commodities loss during the transportation process.

amount due from Zhiyuan Investment Group as of June 30, 2019 was $484,331 as the Company generated revenue from providing inland

transportation management services to Zhiyuan.

As of June 30, 2019, the Company provided a 10% allowance for doubtful accounts

of the amount due from Zhiyuan.

The Company entered into a supplemental service agreement with Zhiyuan to extend the service period

to September 1, 2019.

No additional agreements have been entered into to extend such service period as of the date of this report.

of June 30, 2020, the Company had payable to the CEO of $6,279 and to the Acting CFO of $26,570, both of which were included in

other payable.

These payments were made on behalf of the Company for the daily business operational activities.

In September 2013, the Company executed an inland

transportation management service contract with Zhiyuan Investment Group whereby it would provide certain advisory services and help

control potential commodities loss during the transportation process.

The amount due from Zhiyuan Investment Group as of June 30, 2019

was $484,331 as the Company generated revenue from providing inland transportation management services to Zhiyuan.

As of June 30, 2019,

the Company provided a 10% allowance for doubtful accounts of the amount due from Zhiyuan.

The Company entered into a supplemental service

agreement with Zhiyuan to extend the service period to September 1, 2019.

No additional agreements have been entered into to extend such

service period as of the date of this report.

As of June 30, 2021, the Company

had payable to the CEO of $10,303 and to the Acting CFO of $2,314, both of which were included in other payable.

These payments were made

on behalf of the Company for the daily business operational activities.

Principal Accountant Fees and Services.

LLP was appointed by the Company to serve as its independent registered public accounting firm for fiscal years ended June 30,

2020 and 2019.

Audit services provided by Friedman LLP for fiscal years of 2020 and 2019 included the examination of the consolidated

financial statements of the Company;

October 26, 2020, Audit Alliance LLP (“Audit Alliance”) was appointed as the Company’s independent registered public

accounting firm, and the Company’s previous independent auditors, Friedman LLP (“Friedman”), on the same date.

the fiscal year ended June 30, 2020 and through October 26, 2020, there had been (i) no disagreements between the registrant and Friedman

on any matters of accounting principles or practices, financial statement disclosure, or auditing scope or procedures, which disagreements,

if not resolved to the satisfaction of Friedman, would have caused Friedman to make reference to the subject matter of the disagreement

in its reports on the registrant’s financial statements for such periods, and (ii) no adverse opinions, qualifications, disagreements

or reportable events within the meaning set forth in Item 304(a)(1)(ii), (iv) or (v) of Regulation S-K.

was appointed by the Company to serve as its independent registered public accounting firm for fiscal year ended June 30, 2020.

Audit services provided by Friedman for fiscal year of 2020 included the examination of the consolidated financial statements of the

and services related to periodic filings made with the Commission.

In addition, Friedman

LLP provided review services relating to the Company’s quarterly reports.

fiscal years of 2020 and 2019, Friedman LLP’s fees for the annual audit of our financial statements and the quarterly reviews

of the financial statements included in periodic reports were $254,000 and $232,000, respectively.

In addition, Friedman provided review services relating

to the Company’s quarterly reports.

During fiscal year of 2021, Audit

Alliance’s fees for the annual audit of our financial statements and the quarterly reviews of the financial statements included

in periodic reports were $225,000.

fiscal year of 2020, Friedman LLP’s fees for the annual audit of our financial statements and the quarterly reviews of the financial

statements included in periodic reports were $254,000.

Audit-Related

fees related to tax return preparation amounted to $24,779 and $29,925 during fiscal years of 2020 and 2019, respectively.

Tax fees paid to Rich and Bander

LLP related to tax return preparation amounted to $25,000 during fiscal year of 2020.

fees paid to Friedman related to tax return preparation amounted to $24,779 during fiscal year of 2020.

Committee Pre-Approval Policies

Friedman LLP was engaged by the Company to render audit or non-audit services, the engagement was approved by the Company’s

audit committee.

All services rendered by Friedman LLP have been so approved.

Before Audit Alliance LLP was engaged by the Company to render audit

or non-audit services, the engagement was approved by the Company’s audit committee.

All services rendered by Audit Alliance LLP

have been so approved.

Exhibits, Financial Statement Schedules.

6 unchanged sentences

Form of Common Stock Purchase Warrant dated September 17, 2020.

of Warrant to purchase Common Stock.

Exclusive Management Consulting and Technical Services Agreement by and between Trans Pacific and Sino-China.

5 unchanged sentences

First Amended and Restated Exclusive Marketing Agreement by and between Trans Pacific and Sino-China.

The Company’s 2008 Stock Incentive Plan.

The Company’s 2014 Stock Incentive Plan.

The Company’s 2008 Stock Incentive Plan.

The Company’s 2014 Stock Incentive Plan.

Securities Purchase Agreement dated March 12, 2018.

Placement Agent Agreement dated March 12, 2018.

Offer Letter by and between Mr.

Bradley Haneberg and Sino-Global Shipping America, Ltd., dated May 4, 2018.

Employment Agreement by and between Mr.

Lei Cao and Sino-Global Shipping America, Ltd., dated May 4, 2018.

Lei Cao and Sino-Global Shipping America, Ltd., dated January 1, 2019.

Employment Agreement by and between Ms.

Tuo Pan and Sino-Global Shipping America, Ltd., dated May 4, 2018.

Tuo Pan and Sino-Global Shipping America, Ltd., dated January 1, 2019.

Agreement by and between Mr.

Lei Nie and Sino-Global Shipping America, Ltd., dated as of January 28, 2021 (12)

Agreement by and between Mr.

Xintang You and Sino-Global Shipping America, Ltd., dated as of January 28, 2021 (12)

Agreement by and between Ms.

Jing Shan and Sino-Global Shipping America, Ltd., dated as of August 5, 2021 (10)

Agreement dated February 5, 2021.

Purchase Agreement dated February 6, 2021 (8)

Purchase Agreement dated February 9, 2021 (9)

and Entrusted Management Agreement by and between Sino-Global Shipping America, Ltd.

and Hebei Yanghuai Technology Co., Ltd.

March 3, 2021 (11)

Employment Agreement by and between Mr.

Zhikang Huang and Sino-Global Shipping America, Ltd., dated May 4, 2018.

Securities Purchase Agreement by and between Mr.

Xiangbin Huang and Sino-Global Shipping America, Ltd., dated November 8, 2018 (8)

Amendment Agreement by and between Mr.

Xiangbin Huang and Sino-Global Shipping America, Ltd., dated December 10, 2018 (9)

Share Purchase Agreement dated November 14, 2019 (10)

Offer Letter by and between Mr.

Junfeng Xu and Sino-Global Shipping America, Ltd., dated February 26, 2020 (11)

Share Purchase Agreement dated April 6, 2020 (12)

First Amended and Restated Share Purchase Agreement dated June 17, 2020 (13)

Termination Agreement dated September 3, 2020 (14)

Securities Purchase Agreement dated September 17, 2020 (5)

of Ethics of the Company.

Zhikang Huang and Sino-Global Shipping America, Ltd., dated January 1, 2019.

The Company’s 2021 Stock Incentive Plan (13)

Code of Ethics of the Company.

List of subsidiaries of the Company.*

Consent of Independent Audit Firm.*

Certification

of CEO pursuant to Rule 13a-14 under the Securities Exchange Act of 1934.*

Certification

of CFO pursuant to Rule 13a-14 under the Securities Exchange Act of 1934.*

Consent of Friedman LLP.*

Consent of Audit Alliance LLP.*

Certification of CEO pursuant to Rule 13a-14 under the Securities Exchange Act of 1934.*

Certification of CFO pursuant to Rule 13a-14 under the Securities Exchange Act of 1934.*

Certifications of CEO pursuant to 18 U.S.C.

1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**

Certification

of CFO pursuant to 18 U.S.C.

Certification of CFO pursuant to 18 U.S.C.

1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.**

Press release dated October 13, 2020*

Instance Document.

Taxonomy Extension Schema.

Taxonomy Extension Calculation Linkbase.

Taxonomy Extension Definition Linkbase.

Taxonomy Extension Label Linkbase.

Taxonomy Extension Presentation Linkbase.

certification is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act),

or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under

the Securities Act of 1933, as amended or the Exchange Act.

Inline XBRL Instance Document.

Inline XBRL Taxonomy Extension Schema Document.

Inline XBRL Taxonomy Extension Calculation Linkbase Document.

Inline XBRL Taxonomy Extension Definition Linkbase Document.

Inline XBRL Taxonomy Extension Label Linkbase Document.

Inline XBRL Taxonomy Extension Presentation Linkbase Document.

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

certification is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, as amended (Exchange Act), or otherwise

subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of

1933, as amended or the Exchange Act.

(1) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on January 27, 2014.

(2) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on July 6, 2020.

(3) Incorporated

by reference to the Company’s Registration Statement on Form S-1, Registration Nos.

333-150858 and 333-148611.

(4) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on March 12, 2018

(5) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on September 18, 2020.

(6) Incorporated

by reference to the Company’s Form S-8 filed on April 23, 2014.

(7) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on May 10, 2018

(8) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on November 14, 2018.

(9) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on December 12, 2018.

(10) Incorporated

by reference to the Company’s Quarterly Report on Form 10-Q filed on November 11, 2019.

(11) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on February 26, 2020.

by reference to the Company’s Current Report on Form 8-K filed on March 12, 2018

(5) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on April 8, 2020.

by reference to the Company’s Current Report on Form 8-K filed on September 18, 2020.

(6) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on June 17, 2020.

by reference to the Company’s Form S-8 filed on April 23, 2014.

(7) Incorporated

by reference to the Company’s Current Report on Form 8-K filed on September 3, 2020.

accordance with the requirements of the Exchange Act, the Company caused this report to be signed on its behalf by the undersigned,

thereunto duly authorized.

SINO-GLOBAL SHIPPING AMERICA,

October 13, 2020

Chief Executive Officer

(Principal Executive Officer)

by reference to the Company’s Current Report on Form 8-K filed on January 7, 2019.

Incorporated by reference to the Company’s Current Report on Form 8-K filed on February 8, 2021.

Incorporated by reference to the Company’s Current Report on Form 8-K filed on February 10, 2021.

Incorporated by reference to the Company’s Current Report on Form 8-K filed on August 9, 2021.

Incorporated by reference to the Company’s Current Report on Form 10-Q filed on May 13, 2021.

Incorporated by reference to the Company’s Current Report on Form 8-K filed on January 29, 2021.

Incorporated by reference to the Company’s Registration Statement on Form S-8, Registration No.

accordance with the requirements of the Exchange Act, the Company caused this report to be signed on its behalf by the undersigned, thereunto

duly authorized.

SHIPPING AMERICA, LTD.

September 28, 2021

Executive Officer

Executive Officer)

to the requirements of Section 13 or 15(d) 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 and on the dates indicated.

October 13, 2020

Chief Executive Officer & Chairman of the

(Principal Executive Officer)

October 13, 2020

Executive Officer & Chairman of the Board

Executive Officer)

Chief Financial Officer

(Principal Financial Officer and

Principal Accounting Officer)

October 13, 2020

Zhikang Huang

(Principal Financial Officer and Principal Accounting Officer)

Operating Officer

Xiaohuan Huang

Zhikang Huang

Chief Operating Officer and Director

October 13, 2020

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

the Board of Directors and Stockholders

Shipping America, Ltd.

on the Consolidated Financial Statements

President and Director

T12LL1223B GST Reg

(65) 6227 5428

20 Maxwell Road, #11-09, Maxwell House, Singapore 069113

www.allianceaudit.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Sino-Global Shipping

America, Ltd.

Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheets of Sino-Global Shipping America, Ltd.

and Affiliates (collectively, the “Company”) as of June 30, 2020

and 2019, and the related consolidated statements of operations and comprehensive loss, changes in equity (deficiency) and cash

flows for each of the years in the two-year period ended June 30, 2020, 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, 2020 and 2019, and the results of its operations and its cash flows for each

of the years in the two-year period ended June 30, 2020, in conformity with accounting principles generally accepted in the United

States of America.

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 audits.

We are a public accounting firm registered

with the 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.

conducted our audits 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 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.

and its subsidiaries (collectively, the “Company”) as of June 30, 2021,

the related consolidated statements of income, comprehensive income, shareholders’ equity, and cash flows for the year then ended,

and the related notes to the consolidated financial statements and schedule (collectively, the financial statements).

In our opinion,

the 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 ended June 30, 2021, in conformity with accounting principles generally accepted

in the United States of America.

Basis for Opinion

These financial statements are the responsibility

of the Company’s management.

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

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance

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 financial

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

Our audit included performing procedures to assess the risks

of material misstatement of the 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 financial statements.

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

presentation of the financial statements.

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

Very truly yours,

/s/ Audit Alliance LLP

We have served as the Company’s auditor since October 28, 2020

September 28, 2021

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING

To the Board of Directors and Stockholders

Sino-Global Shipping America, Ltd.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance

sheets of Sino-Global Shipping America, Ltd.

and Affiliates (collectively, the “Company”) as of June 30, 2020 and 2019, and

the related consolidated statements of operations and comprehensive loss, changes in equity (deficiency) and cash flows for each

of the years in the two-year period ended June 30, 2020, and the related notes (collectively referred to as the consolidated financial

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

the Company as of June 30, 2020 and 2019, and the results of its operations and its cash flows for each of the years in the two-year period

ended June 30, 2020, in conformity with accounting principles generally accepted in the United States of America.

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 audits.

We are a public accounting firm registered with the 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 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 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.

Accordingly, we express no such opinion.

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 risks.

Such procedures included examining, on a test basis,

evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audits also included evaluating the

accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the

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 risks.

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

consolidated financial statements.

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

Consideration

of the Company’s Ability to Continue as a Going Concern

accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern.

in Note 2 to the consolidated financial statements, the Company had incurred significant working capital deficiency, recurring

losses from operations and accumulated deficit at June 30, 2020.

These factors raise substantial doubt about the Company’s

ability to continue as a going concern.

Management’s plans in regards to these matters are also described in Note 2.

financial statements do not include any adjustments that might result from the outcome of these uncertainties.

If the Company

is unable to successfully obtain the necessary additional financial support as specified in Note 2, there could be a material

adverse effect on the Company.

have served as the Company’s auditor since 2007

York, New York

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 our opinion.

Consideration of the Company’s Ability to

Continue as a Going Concern

The accompanying consolidated financial statements

have been prepared assuming the Company will continue as a going concern.

As discussed in Note 2 to the consolidated financial statements,

the Company had incurred significant working capital deficiency, recurring losses from operations and accumulated deficit at June 30,

These factors raise substantial doubt about the Company’s ability to continue as a going concern.

Management’s plans

in regards to these matters are also described in Note 2.

These financial statements do not include any adjustments that might result

from the outcome of these uncertainties.

If the Company is unable to successfully obtain the necessary additional financial support as

specified in Note 2, there could be a material adverse effect on the Company.

/s/ Friedman LLP

We have served as the Company’s auditor since

New York, New York

October 13, 2020

SHIPPING AMERICA, LTD.

2 unchanged sentences

Current assets

Notes receivable

Cryptocurrencies

Accounts receivable, net

7 unchanged sentences

Intangible assets, net

Prepaid expenses

Other long-term assets - deposits

Liabilities and Equity (Deficiency)

Loan receivable related parties

Liabilities and Equity

Current Liabilities

7 unchanged sentences

Lease liabilities - noncurrent

Loans payable - noncurrent

Loan payable - noncurrent

Total liabilities

1 unchanged sentence

Equity (Deficiency)

Preferred stock, 2,000,000 shares authorized, no par value, none issued

Preferred stock, 2,000,000 shares authorized, no par value, no shares issued and outstanding as of June 30, 2021 and June 30, 2020, respectively

Common stock, 50,000,000 shares authorized, no par value;

3,718,788 and 3,210,907 shares issued as of June 30, 2020 and 2019, respectively;

3,718,788 and 3,175,807 shares outstanding as of June 30, 2020 and 2019, respectively*

15,132,113 and 3,718,788 shares issued and outstanding as of June 30, 2021 and 2020, respectively*

Additional paid-in capital

Subscription receivable

Treasury stock, at cost, 0 and 35,099 shares as of June 30, 2020 and 2019*

Accumulated deficit

( 30,244,937 )

( 23,421,594 )

Accumulated other comprehensive loss

( 1,084,030 )

Total Sino-Global Shipping America Ltd.

1 unchanged sentence

Non-controlling Interest

( 6,951,134 )

( 6,542,361 )

Total Equity (Deficiency)

Total Liabilities and Equity (Deficiency)

and per share data are presented on a retroactive basis to reflect the 1-for-5 reverse stock split on July 7, 2020.

* Shares and per share data are presented on a retroactive basis to reflect the 1-for-5 reverse stock split on July 7, 2020.

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

3 unchanged sentences

For the Years Ended

Net revenues - third parties

Net revenues - related party

Total revenues

Cost of revenues

( 4,974,394 )

( 3,678,863 )

Selling expenses

General and administrative expenses

( 5,605,670 )

( 3,386,690 )

Impairment loss of fixed assets and intangible asset

Impairment loss of deposit for leasehold improvement

Provision for doubtful accounts

Recovery (provision) for doubtful accounts, net

( 14,910,502 )

Stock-based compensation

( 1,576,756 )

Total operating expenses

3 unchanged sentences

( 6,261,000 )

Other expense, net

( 17,738,104 )

Other expenses, net

Net loss before provision for income taxes

( 6,769,597 )

( 17,742,626 )

Income tax expense

( 6,773,047 )

Net loss attributable to non-controlling interest

( 17,928,647 )

Net income (loss) attributable to non-controlling interest

( 1,475,753 )

Net loss attributable to Sino-Global Shipping America, Ltd.

7 unchanged sentences

( 6,773,535 )

( 18,311,850 )

Comprehensive loss attributable to non-controlling interest

( 1,368,739 )

Comprehensive loss attributable to Sino-Global Shipping America, Ltd.

5 unchanged sentences

Basic and diluted*

and per share data are presented on a retroactive basis to reflect the 1-for-5 reverse stock split on July 7, 2020.

* Shares and per share data are presented on a retroactive basis to reflect the 1-for-5 reverse stock split on July 7, 2020.

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

SINO-GLOBAL SHIPPING AMERICA, LTD.

CONSOLIDATED STATEMENTS OF CHANGES IN

EQUITY (DEFICIENCY)

SHIPPING AMERICA, LTD.

AND AFFILIATES

STATEMENTS OF CHANGES IN EQUITY (DEFICIENCY)

comprehensive

2 unchanged sentences

$ ( 417,538 )

Stock based compensation

$ ( 6,968,700 )

$ ( 671,106 )

$ ( 5,173,622 )

Stock based compensation to employee

Stock based compensation to consultants

Amortization of shares issued

to consultants

Issuance of common stock

to private investors

Amortization of shares

to management and employees

Amortization of shares

issued to consultants

Issuance of common stock to private

Cancellation of treasury stock

Foreign currency translation

income (loss)

( 16,452,894 )

( 1,398,460 )

( 17,851,354 )

BALANCE, June 30, 2020

1 unchanged sentence

( 1,084,030 )

Stock based compensation

to consultants

Amortization of shares

issued to consultants

Issuance of common stock

to private investor

Cancellation of treasury

( 6,542,361 )

Issuance of preferred stock to

private investor

Issuance of common stock to private

Conversion of preferred stock

into common stock

( 1,427,600 )

Exercise of stock warrants

Foreign currency translation

6 unchanged sentences

* Shares and per share data are presented on a retroactive basis to reflect the 1-for-5 reverse stock split on July 7, 2020.

The accompanying notes are an integral

part of these audited consolidated financial statements.

SINO-GLOBAL SHIPPING AMERICA, LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

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

SHIPPING AMERICA, LTD.

AND AFFILIATES

STATEMENTS OF CASH FLOWS

For the Years Ended

6 unchanged sentences

Non-cash lease expense

Provision for doubtful accounts, net of recovery

(Recovery) provision for doubtful accounts, net

Impairment loss of fixed assets and intangible asset

Impairment loss of deposit for leasehold improvement

Deferred tax provision

Gain from loan forgiveness

Loss on disposal of fixed assets

Changes in assets and liabilities

Cryptocurrencies

Notes receivable

1 unchanged sentence

Other receivables

( 5,806,997 )

Advances to suppliers - third parties

Advances to suppliers - related party

Prepaid expenses and other current assets

6 unchanged sentences

Accrued expenses and other current liabilities

( 1,122,791 )

Net cash used in operating activities

( 4,150,112 )

( 3,896,534 )

Investing Activities

Acquisition of property and equipment

( 1,510,379 )

Proceeds from disposal of property and equipment

Loan receivable - related parties

( 4,529,806 )

Net cash used in investing activities

( 6,040,185 )

Financing Activities

Proceeds from issuance of preferred stock

Proceeds from issuance of common stock

Proceeds from loan

Repayment of loan payable

Net cash provided by financing activities

Effect of exchange rate fluctuations on cash

Net decrease in cash

Net increase (decrease) in cash

( 3,011,468 )

Cash at beginning of year

2 unchanged sentences

Income taxes paid

Interest paid

Non-cash transactions of operating and investing activities

1 unchanged sentence

Initial recognition of right-of-use assets and lease liabilities

The accompanying notes are an integral

part of these audited consolidated financial statements.

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

SHIPPING AMERICA, LTD.

2 unchanged sentences

ORGANIZATION AND NATURE OF BUSINESS

in the United States (the “U.S.”) in 2001, Sino-Global Shipping America, Ltd., a Virginia corporation (“Sino-Global”

or the “Company”), is a global shipping and freight logistics integrated solution provider.

in the United States (the “U.S.”) in 2001, Sino-Global Shipping America, Ltd., a Virginia corporation (“Sino-Global”

or the “Company”), is a global shipping and freight logistics integrated solution provider.

The Company provides tailored

solutions and value-added services to its customers to drive efficiency and control in related steps throughout the entire shipping

and freight logistics chain.

The Company conducts its business primarily through its wholly-owned subsidiaries in the People’s

Republic of China (the “PRC”) (including Hong Kong) and the U.S.

where a majority of the Company’s clients are

Company operates in four operating segments including (1) shipping agency and management services, which are operated by its subsidiary

in Hong Kong and the U.S.;

(2) inland transportation management services, which are operated by its subsidiaries in the U.S.;

(3) freight logistics services, which are operated by its subsidiaries in the PRC and the U.S.;

(4) container trucking services,

which are operated by its subsidiaries in the PRC and the U.S.

to fiscal year 2019, the Company mainly focused on freight logistics and inland transportation management services.

Starting with

fiscal year 2019, current trade dynamics made it more expensive for shipping carrier clients to cost-effectively move cargo into

ports, which has caused the Company to shift its focus back to shipping agency and management business.

The shipping agency

industry in China has improved and the number of shipping agencies overall the country has decreased, due to both price

and the inability of competitors to embrace technology as a resource in serving client needs.

September 3, 2018, the Company entered into a cooperation agreement with Ningbo Far-East Universal Shipping Agency Co., Ltd.

set up a joint venture in Hong Kong named Bright Far East International Shipping Agency Co., Ltd., to engage in worldwide shipping

agency operations.

The Company has a 51% equity interest in the joint venture.

On May 23, 2019, Bright Far East International

Shipping Agency Co., Ltd.

incorporated in New York and terminated its registration in Hong Kong.

There has been no major operation

of the joint venture for the year ended June 30, 2020 and 2019.

Currently the Company is conducting the shipping agency business

through its wholly-owned Hong Kong subsidiary.

solutions and value-added services to its customers to drive efficiency and control in related steps throughout the entire shipping and

freight logistics chain.

The Company conducts its business primarily through its wholly-owned subsidiaries in the People’s Republic

of China (the “PRC” or “China”) (including Hong Kong) and the U.S.

where a majority of the Company’s clients

Company operates in three operating segments including (1) shipping agency and management services, which are operated by its subsidiaries

(2) freight logistics services, which are operated by its subsidiaries in the PRC;

(3) container trucking services, which

are operated by its subsidiaries in the U.S.

April 10, 2019, the Company entered into a cooperation agreement with Mr.

Weijun Qin, the Chief Executive Officer of a shipping

management company in China, to set up a joint venture in New York named State Priests Management Ltd.

(“State Priests”),

in which the Company will hold a 20% equity interest.

On July 26, 2019, the Company signed a revised cooperation agreement with

Weijun Qin which changed the Company’s equity interest in State Priests from 20% to 90%.

The Company has not provided

any cash contribution to the joint venture and there has been no operation of the joint venture pending the International Ship

Safety Management Certificate from the China Classification Society (the “Certificate”).

Sino-Global Shipping New

started providing shipping management related services that do not require certification which includes arranging and

coordinating for ship maintenance and inspection this quarter.

Weijun Qin, the Chief Executive Officer of a shipping management

company in China, to set up a joint venture in New York named State Priests Management Ltd.

(“State Priests”), in which the

Company will hold a 20 % equity interest.

On July 26, 2019, the Company signed a revised cooperation agreement with Mr.

Weijun Qin which

changed the Company’s equity interest in State Priests from 20 % to 90 %.

The Company has not provided any cash contribution to the

joint venture and there has been no operation of the joint venture pending the International Ship Safety Management Certificate from

the China Classification Society (the “Certificate”).

Sino-Global Shipping New York Inc.

started providing shipping management

related services that do not require certification which includes arranging and coordinating for ship maintenance and inspection this

November 6, 2019, the Company signed a revised cooperation agreement with Mr.

Weijun Qin to restructure their equity interest

in State Priests.

Weijun Qin to restructure their equity interest in State

Given that State Priests failed to timely obtain the necessary approval from related authorities, Mr.

Qin agreed to exchange 80% equity interest in Sea Continent Management Ltd.

(“Sea Continent”), another New York entity

Qin owns for the Company’s 90% equity interest in State Priests.

Weijun Qin agreed to exchange

80 % equity interest in Sea Continent Management Ltd.

(“Sea Continent”), another New York entity Mr.

Qin owns for the Company’s

90 % equity interest in State Priests.

The equity transfer has been consummated.

Sea Continent

already has the Certificate but has no operations as of June 30, 2020.

There has been no capital injection nor operations of State

Priests and Sea Continent as of June 30, 2020, therefore no gain or loss has been recognized in the transaction.

On January 10, 2020, the

Company entered into a cooperation agreement with Mr.

Shanming Liang, a shareholder of the Company, to set up a joint venture

in New York named LSM Trading Ltd., in which the Company holds a 40% equity interest.

No investment has been made by the Company

as of the date of this report.

Sea Continent already has the Certificate but has no

operations as of June 30, 2020.

There has been no capital injection nor operations of State Priests and Sea Continent as of June 30,

2020, therefore no gain or loss has been recognized in the transaction.

There has been no operation for Sea Continent for the year ended

June 30, 2021.

January 10, 2020, the Company entered into a cooperation agreement with Mr.

Shanming Liang, a shareholder of the Company, to set up a

joint venture in New York named LSM Trading Ltd., in which the Company holds a 40 % equity interest.

No investment has been made by the

Company as of the date of this report.

The new joint venture will facilitate the purchase agricultural related commodities in the U.S.

for customers in China and the Company will provide comprehensive supply chain and logistics solutions.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

outbreak of the novel coronavirus (COVID-19) starting from late January 2020 in the PRC has spread rapidly to many parts of the

In March 2020, the World Health Organization declared the COVID-19 as a pandemic and has resulted in quarantines, travel

restrictions, and the temporary closure of stores and business facilities in China and the U.S.

for the past few months.

the rapidly expanding nature of the COVID-19 pandemic, and because substantially all of the Company’s business operations

and its workforce are concentrated in China and the U.S., the Company’s business, results of operations, and financial condition

have been adversely affected for the year ended June 30, 2020.

the close of the stock market on July 7, 2020, the Company effected a l-for-5 reverse stock split of its common stock in

order to satisfy continued listing requirements of its common stock on the NASDAQ Capital Market.

The reverse stock split was

approved by the Company’s board of directors and stockholders and was intended to allow the company to meet the minimum

share price requirement of $1.00 per share for continued listing on the NASDAQ Capital Market.

As a result all common stock

share amounts included in this filing have been retroactively reduced by a factor of five, and all common stock per share

amounts have been increased by a factor of five.

Amounts affected include common stock outstanding, including those that have

resulted from the stock options, and warrants that convert to common stock.

There has been no operation for

LSM Trading for the years ended June 30, 2021 and 2020.

the close of the stock market on July 7, 2020, the Company effected a l-for-5 reverse stock split of its common stock in order to satisfy

continued listing requirements of its common stock on the NASDAQ Capital Market.

The reverse stock split was approved by the Company’s

board of directors and stockholders and was intended to allow the Company to meet the minimum share price requirement of $1.00 per share

for continued listing on the NASDAQ Capital Market.

As a result all common stock share amounts included in this filing have been retroactively

reduced by a factor of five, and all common stock per share amounts have been increased by a factor of five.

Amounts affected include

common stock outstanding, including those that have resulted from the stock options, and warrants that convert to common stock.

July 31, 2020, the Company deregistered Longhe Ship Management (Hong Kong) Co., Limited (“LSM”) which is 100 % own by Sino-Global

Shipping (HK) Ltd.

LSM has not been in operation or carried on business after June 30, 2018.

The result of operations of

LSM was immaterial for the years ended June 30, 2020 and 2019.

December 14, 2020, the Company incorporated a new entity named “Blumargo IT Solution Ltd.” with 80 % ownership in partnership

with Tianjin Anboweiye Technology Co.

to build up hi-tech and information-based logistic services to meet the higher and complicate demand

of customers.

On June 30, 2021, the company increased the ownership to 100 %.

March 19, 2021, the Company established a wholly owned entity of named “Cullinan Global Logistics Inc” which was set up to

support its freight logistics services in the U.S.

The Company dissolved Cullinan on June 28, 2021.

There was no material operation for

the year ended June 30, 2021.

from March 2021, the Company started cryptocurrency mining.

The Company plans to leverage information technology and other innovative

technologies in its business platform.

These types of technology may be helpful in expanding its traditional logistics service expertise.

Starting from March 2, 2021, the Company accepts Bitcoin as a form of payment for its global shipping, freight, and logistics services.

Payments made in Bitcoin will be made at the rate applicable at the payment date.

March 2, 2021, the Company entered into a purchase agreement (the “Agreement”) with Hebei Yanghuai Technology Co., Ltd.

for the purchase of 2,783 digital currency mining servers.

The total gross purchase price was $ 4.6 million.

The total computing power

will reach 50,440 t/s.

After the transaction is completed, Yanghuai will manage and operate the servers at Yanghuai’s site with

no further charge from March 10, 2021 through March 9, 2022, after which time Sino-Global may engage Yanghuai to continue providing service

The first cash payment of approximately $0.9 million was paid within 15 days after the date of signing the Agreement.

second cash payment of approximately $0.9 million will be paid within 15 days after the date of acceptance of the servers and a special

VAT invoice provided by Yanghuai.

The remaining payment of approximately $2.8 million will be paid in 5 quarters within 10 days following

the filing of Form 10-K or Form 10-Q for each of the Company’s financial quarters ending March 31, 2021, June 30, 2021, September

30, 2021, December 31, 2021 and March 31, 2022, subject to reductions if Yanghuai fails to meet the monthly committed net profit.

the last two month, national and local governments in China have gradually restricted and banned cryptocurrency mining operations, causing

owners of servers like the Products to cease operations.

The Company has been advised that the operation of the mining has been paused

by the Seller, which had continued to operate the Products on behalf of the Registrant.

Based on amended agreement signed by the Company

and Yanghuai on September 17, 2021, the Company is not liable for rest of the contract price and has title to half of the products.

Company recorded impairment for the mining equipment in the last quarter of 2021 in the amount of approximately $ 0.9 million.

March 24, 2021, the Company agreed to acquire a 60 % ownership of Super Node LLC, which is a blockchain infrastructure developer and service

provider, in cash or stock transaction for $ 5.0 million subject to valuation.

The transaction is subject to the satisfaction of warranties

and representations under the purchase agreement.

Due to recent regulation of Bitcoin in China, the Company has paused the acquisition.

April 13, 2021, the Company formed a joint venture in which the Company owned 99 % equity interest of Hainan Saimeinuo Trading Co., Ltd.,

in the free tax zone in Hainan Province, China, with a register capital of approximately $ 1.5 million.

This subsidiary primarily engages

in freight logistics services.

April 21, 2021, the Company entered into a cooperation agreement with Mr.

Bangpin Yu to set up a joint venture in U.S.

named “Brilliant

Warehouse Service Inc” to support its freight logistics services in the U.S.

The Company has a 51 % equity interest in the joint

outbreak of the novel coronavirus (COVID-19) starting from late January 2020 in the PRC has spread rapidly to many parts of the world.

In March 2020, the World Health Organization declared the COVID-19 as a pandemic and has resulted in quarantines, travel restrictions,

and the temporary closure of stores and business facilities in China and the U.S..

Given the rapidly expanding nature of the COVID-19

pandemic, and because substantially all of the Company’s business operations and its workforce are concentrated in China and the

U.S., the Company’s business, results of operations, and financial condition have been adversely affected for the year ended June

The situation remains highly uncertain for any further outbreak or resurgence of the COVID-19.

It is therefore difficult for

the Company to estimate the impact on the business or operating results that might be adversely affected by any further outbreak or resurgence

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles

in the United States of America (“US GAAP”) pursuant to the rules and regulations of the Securities and Exchange Commission

(“SEC”).

The consolidated financial statements include the accounts of the Company and include the assets, liabilities,

revenues and expenses of the subsidiaries and VIEs.

accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the

United States of America (“US GAAP”) pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”).

The consolidated financial statements include the accounts of the Company and include the assets, liabilities, revenues and expenses

of the subsidiaries and VIEs.

All intercompany transactions and balances have been eliminated in consolidation.

Shipping Agency Ltd., a PRC corporation (“Sino-China”), is considered a variable interest entity (“VIE”),

with the Company as the primary beneficiary.

The Company, through Trans Pacific Shipping Ltd., entered into certain agreements

with Sino-China, pursuant to which the Company receives 90% of Sino-China’s net income.

a VIE, Sino-China’s revenues are included in the Company’s total revenues, and any income/loss from operations is

consolidated with that of the Company.

Because of contractual arrangements between the Company and Sino-China, the Company has

a pecuniary interest in Sino-China that requires consolidation of the financial statements of the Company and Sino-China.

Company has consolidated Sino-China’s operating results in accordance with Accounting Standards Codification (“ASC”)

810-10, “Consolidation”.

The agency relationship between the Company and Sino-China and its branches is governed by

a series of contractual arrangements pursuant to which the Company has substantial control over Sino-China.

Management makes ongoing

reassessments of whether the Company remains the primary beneficiary of Sino-China.

carrying amount and classification of Sino-China’s assets and liabilities included in the Company’s consolidated balance

Shipping Agency Ltd., a PRC corporation (“Sino-China”), is considered a variable interest entity (“VIE”), with

the Company as the primary beneficiary.

The Company, through Trans Pacific Shipping Ltd., entered into certain agreements with Sino-China,

pursuant to which the Company receives 90 % of Sino-China’s net income.

Sino-China was designed to operate in China for the benefit

of the Company.

The Company does not receive any payment from Sino-China unless Sino-China recognizes net income during its fiscal year.

These agreements do not entitle the Company to any consideration if Sino-China incurs a net loss during its fiscal year.

If Sino-China

incurs a net loss during its fiscal year, the Company is not required to absorb such net loss.

a VIE, Sino-China’s revenues are included in the Company’s total revenues, and any income/loss from operations is consolidated

with that of the Company.

Because of contractual arrangements between the Company and Sino-China, the Company has a pecuniary interest

in Sino-China that requires consolidation of the financial statements of the Company and Sino-China.

Company has consolidated Sino-China’s operating results in accordance with Accounting Standards Codification (“ASC”)

810-10, “Consolidation”.

The agency relationship between the Company and Sino-China and its branches is governed by a series

of contractual arrangements pursuant to which the Company has substantial control over Sino-China.

Management makes ongoing reassessments

of whether the Company remains the primary beneficiary of Sino-China.

carrying amount and classification of Sino-China’s assets and liabilities included in the Company’s consolidated balance

sheets were as follows:

current assets

Other receivables

Prepaid expenses and other current assets

Total current assets

Property and equipment, net

Current liabilities:

Other payables and accrued liabilities

Total liabilities

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

and equipment, net

payables and accrued liabilities

Fair Value of Financial Instruments

Company follows the provisions of ASC 820, Fair Value Measurements and Disclosures, which clarifies the definition of fair value,

prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair

value as follows:

Observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities available at

the measurement date.

Inputs other than quoted prices that are observable for the asset or liability in active markets, quoted prices for

identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable,

and inputs derived from or corroborated by observable market data.

Unobservable inputs that reflect management’s assumptions based on the best available information.

carrying value of accounts receivable, other receivables, other current assets, and current liabilities approximate their fair

values because of the short-term nature of these instruments.

Company follows the provisions of ASC 820, Fair Value Measurements and Disclosures, which clarifies the definition of fair value, prescribes

methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows:

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

2 — Inputs other than quoted prices that are observable for the asset or liability in active markets, quoted prices for identical

or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived

from or corroborated by observable market data.

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

carrying value of accounts receivable, other receivables, other current assets, and current liabilities approximate their fair values

because of the short-term nature of these instruments.

Use of Estimates and Assumptions

preparation of the Company’s consolidated financial statements in conformity with US GAAP requires management to make estimates

and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities

at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

are adjusted to reflect actual experience when necessary.

Significant accounting estimates reflected in the Company’s consolidated

financial statements include revenue recognition, fair value of stock based compensation, cost of revenues, allowance for doubtful

accounts, impairment loss, deferred income taxes, income tax expense and the useful lives of property and equipment.

into the Company’s judgments and estimates consider the economic implications of COVID-19 on the Company’s critical

and significant accounting estimates.

Since the use of estimates is an integral component of the financial reporting process,

actual results could differ from those estimates.

preparation of the Company’s consolidated financial statements in conformity with US GAAP requires management to make estimates

and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the

dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

Estimates are adjusted

to reflect actual experience when necessary.

Significant accounting estimates reflected in the Company’s consolidated financial

statements include revenue recognition, fair value of stock based compensation, cost of revenues, allowance for doubtful accounts, impairment

loss, deferred income taxes, income tax expense and the useful lives of property and equipment.

The inputs into the Company’s judgments

and estimates consider the economic implications of COVID-19 on the Company’s critical and significant accounting estimates.

the use of estimates is an integral component of the financial reporting process, actual results could differ from those estimates.

Translation of Foreign Currency

accounts of the Company and its subsidiaries are measured using the currency of the primary economic environment in which the

entity operates (the “functional currency”).

The Company’s functional currency is the U.S.

dollar (“USD”)

while its subsidiaries in the PRC, including Sino-China, Trans Pacific Shipping Ltd.

accounts of the Company and its subsidiaries are measured using the currency of the primary economic environment in which the entity

operates (the “functional currency”).

The Company’s functional currency is the U.S.

dollar (“USD”) while

its subsidiaries in the PRC, including Sino-China, Trans Pacific Shipping Ltd.

and Trans Pacific Logistic Shanghai Ltd.

report their financial positions and results of operations in Renminbi (“RMB”), its subsidiary Sino-Global Shipping

Australia Pty Ltd., reports its financial positions and results of operations in Australian dollar (“AUD”), its subsidiary

Sino-Global Shipping Hong Kong reports its financial positions and results of operations in Hong Kong dollar (“HKD”)

and its subsidiary Sino-Global Shipping Canada, Inc.

reports its financial positions and results of operations in Canadian Dollar

(“CAD”).

The accompanying consolidated financial statements are presented in USD.

Foreign currency transactions are

translated into USD using the fixed exchange rates in effect at the time of the transaction.

Generally, foreign exchange gains

and losses resulting from the settlement of such transactions are recognized in the consolidated statements of operations.

Company translates the foreign currency financial statements in accordance with ASC 830-10, “Foreign Currency Matters”.

Assets and liabilities are translated at current exchange rates quoted by the People’s Bank of China at the balance sheets’

dates and revenues and expenses are translated at average exchange rates in effect during the year.

The resulting translation

adjustments are recorded as other comprehensive loss and accumulated other comprehensive loss as a separate component of equity

of the Company, and also included in non-controlling interests.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

financial positions and results of operations in Renminbi (“RMB”), its subsidiary Sino-Global Shipping Australia Pty Ltd.,

reports its financial positions and results of operations in Australian dollar (“AUD”), its subsidiary Sino-Global Shipping

Hong Kong reports its financial positions and results of operations in Hong Kong dollar (“HKD”) and its subsidiary Sino-Global

Shipping Canada, Inc.

reports its financial positions and results of operations in Canadian Dollar (“CAD”).

The accompanying

consolidated financial statements are presented in USD.

Foreign currency transactions are translated into USD using the fixed exchange

rates in effect at the time of the transaction.

Generally, foreign exchange gains and losses resulting from the settlement of such transactions

are recognized in the consolidated statements of operations.

The Company translates the foreign currency financial statements in accordance

with ASC 830-10, “Foreign Currency Matters”.

Assets and liabilities are translated at current exchange rates quoted by the

People’s Bank of China at the balance sheets’ dates and revenues and expenses are translated at average exchange rates in

effect during the year.

The resulting translation adjustments are recorded as other comprehensive loss and accumulated other comprehensive

loss as a separate component of equity of the Company, and also included in non-controlling interests.

exchange rates for the years ended June 30, 2021 and 2020 are as follows:

Foreign currency

Balance Sheet

Cash consists of cash

on hand and cash in bank which are unrestricted as to withdrawal or use.

The Company maintains cash with various financial institutions

mainly in the PRC, Australia, Hong Kong, Canada and the U.S.

consists of cash on hand and cash in bank which are unrestricted as to withdrawal or use.

The Company maintains cash with various financial

institutions mainly in the PRC, Australia, Hong Kong, Canada and the U.S.

As of June 30, 2021 and 2020, cash balances of $ 628,039 and

1 unchanged sentence

$ 201,990 and $ 8,780 of these balances are not covered by

insurance as the deposit insurance system in China only insured each depositor at one bank for a maximum of approximately $70,000

(RMB 500,000).

insurance as the deposit insurance system in China only insured each depositor at one bank for a maximum of approximately $ 70,000 (RMB

As of June 30, 2021 and 2020, cash balances of $ 44,203,436 and $ 25,739 , respectively, were maintained at U.S.

institutions, and were insured by the Federal Deposit Insurance Corporation or other programs subject to certain limitations.

Hong Kong Deposit Protection Board pays compensation up to a limit of HKD 500,000 (approximately $64,000) if the bank with which

an individual/a company holds its eligible deposit fails.

As of June 30, 2020 and 2019, cash balances of $2,029 and $4,386, respectively,

were maintained at financial institutions in Hong Kong and were insured by the Hong Kong Deposit Protection Board.

financial institutions.

$ 43,507,335 and nil of these balances are not covered by insurance, as each U.S.

account was insured by the Federal Deposit Insurance

Corporation or other programs subject to $ 250,000 limitations.

The Hong Kong Deposit Protection Board pays compensation up to a limit

of HKD 500,000 (approximately $64,000) if the bank with which an individual/a company holds its eligible deposit fails.

As of June 30,

2020 and 2019, cash balances of $1,116 and $1,821, respectively, were maintained at Australia financial institutions, and were

insured as the Australian government guarantees deposits up to AUD 250,000 (approximately $172,000).

As of June 30, 2020 and 2019,

amount of deposits the Company had covered by insurance amounted to $117,940 and $198,165, respectively.

Notes receivable

receivable represents trade accounts receivable due from various customers where the customers’

banks have guaranteed the

The notes are non-interest bearing and normally paid within three to six months.

The Company has the ability to submit

request for payment to the customer’s bank earlier than the scheduled payment date, but will incur an interest charge and

a processing fee.

2021 and 2020, cash balances of $ 3,698 and $ 2,029 , respectively, were maintained at financial institutions in Hong Kong and were insured

by the Hong Kong Deposit Protection Board.

As of June 30, 2021 and 2020, cash balances of $ 693 and $ 1,116 , respectively, were maintained

at Australia financial institutions, and were insured as the Australian government guarantees deposits up to AUD 250,000 (approximately

As of June 30, 2021 and 2020, amount of deposits the Company had covered by insurance amounted to $ 1,125,838 and $ 117,940 ,

respectively.

Cryptocurrencies

Cryptocurrencies, mainly bitcoin, are included

in current assets in the accompanying consolidated balance sheets.

Cryptocurrencies purchased are recorded at cost and cryptocurrencies

awarded to the Company through its mining activities are accounted for as other revenue of the Company for the year ended June 30, 2021.

Fair value of the cryptocurrency award received is determined using the quoted price of the related cryptocurrency at the time of receipt.

Cryptocurrencies

held are accounted for as intangible assets with indefinite useful lives.

An intangible asset with an indefinite useful life is not amortized

but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely

than not that the indefinite-lived asset is impaired.

Impairment exists when the carrying amount exceeds its fair value, which is measured

using the quoted price of the cryptocurrency at the time its fair value is being measured.

In testing for impairment, the Company has

the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists.

is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary.

Company concludes otherwise, it is required to perform a quantitative impairment test.

To the extent an impairment loss is recognized,

the loss establishes the new cost basis of the asset.

Subsequent reversal of impairment losses is not permitted.

Receivables and Allowance for Doubtful Accounts

receivable are presented at net realizable value.

Accounts receivable are presented at net realizable

The Company maintains allowances for doubtful accounts and for estimated losses.

The Company reviews the accounts receivable on a periodic basis and makes general and specific allowances when there is doubt

as to the collectability of individual receivable balances.

In evaluating the collectability of individual receivable balances,

the Company considers many factors, including the age of the balances, customers’

historical payment history, their current

credit-worthiness and current economic trends.

Receivables are generally considered past due after 180 days.

The Company reserves

25%-50% of the customers balance aged between 181 days to 1 year, 50%-100% of the customers balance over 1 year and 100% of the

customers balance over 2 years.

Accounts receivable are written off against the allowances only after exhaustive collection efforts.

As the Company has focused its development in the shipping management segment, its customer base will be more from smaller privately

owned companies that will pay more timely than state owned companies.

The Company also considers the economic implications of

COVID-19 on its estimates of the allowance and made additional $4,996,006 of allowance for doubtful accounts and wrote off $8,220,754

of accounts receivable for the year ended June 30, 2020.

There was no write off for year ended June 30, 2019.

The Company recovered

$99,366 of accounts receivable for the year ended June 30, 2020.

There was no recovery for year ended June 30, 2019.

Other receivables represent mainly customer advances, prepaid

employee insurance and welfare benefits, which will be subsequently deducted from the employee payroll, guarantee deposits on behalf

of ship owners as well as office lease deposits.

The Company reviews the accounts receivable on

a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual receivable balances.

In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balances,

customers’ historical payment history, their current credit-worthiness and current economic trends.

Receivables are generally considered

past due after 180 days.

The Company reserves 25%-50% of the customers balance aged between 181 days to 1 year, 50%-100% of the customers

balance over 1 year and 100% of the customers balance over 2 years.

Accounts receivable are written off against the allowances only after

exhaustive collection efforts.

As the Company has focused its development in the shipping management segment, its customer base will be

more from smaller privately owned companies that will pay more timely than state owned companies.

The Company also considers the economic

implications of COVID-19 on its estimates of the allowance and made $ 1,033,407 and $ 4,996,606 provision for doubtful accounts for the

years ended June 30, 2021 and 2020.There was no write off for year ended June 30, 2021 and wrote off $ 8,220,754 of accounts receivable

for the year ended June 30, 2020.

The Company recovered $ 2,512 and $ 99,366 of accounts receivable for the year ended June 30, 2021 and

2020 respectively.

Other receivables represent mainly customer advances,

prepaid employee insurance and welfare benefits, which will be subsequently deducted from the employee payroll, guarantee deposits on

behalf of ship owners as well as office lease deposits.

Management reviews its receivables on a regular basis to determine if the bad

debt allowance is adequate, and adjusts the allowance when necessary.

Delinquent account balances are written-off against allowance

for doubtful accounts after management has determined that the likelihood of collection is not probable.

Other receivables are

written off against the allowances only after exhaustive collection efforts.

The Company also considers the economic implications

of COVID-19 on its estimates of the allowance and made additional $10,055,203 of allowance for doubtful accounts for the year ended

June 30, 2020.

For the year ended June 30, 2020, $1,763 was written off against other receivables, respectively.

There was no write

off for the year ended June 30, 2019.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

Delinquent account balances are written-off against allowance for

doubtful accounts after management has determined that the likelihood of collection is not probable.

Other receivables are written off

against the allowances only after exhaustive collection efforts.

The Company made nil and $ 10,055,203 allowance for doubtful accounts

of other receivables for the years ended June 30, 2021 and 2020, respectively.

For the years ended June 30, 2021 and 2020, $ 11,665 and

$ 1,763 were written off against other receivables, respectively.

The Company recovered $ 4,786,814 and nil of other receivables for the

years ended June 30, 2021 and 2020.

Property and Equipment, net

and equipment are stated at historical cost less accumulated depreciation.

Historical cost comprises its purchase price and any

directly attributable costs of bringing the assets to its working condition and location for its intended use.

Depreciation is

calculated on a straight-line basis over the following estimated useful lives:

Motor vehicles

Computer and office

Furniture and fixtures

System software

Leasehold improvements

Historical cost comprises its purchase price and any directly

attributable costs of bringing the assets to its working condition and location for its intended use.

Depreciation is calculated on a

straight-line basis over the following estimated useful lives:

and office equipment

Shorter of lease term or useful lives

carrying value of a long-lived asset is considered impaired by the Company when the anticipated undiscounted cash flows from such

asset is less than its carrying value.

If impairment is identified, a loss is recognized based on the amount by which the carrying

value exceeds the fair value of the long-lived asset.

Fair value is determined primarily using the anticipated cash flows discounted

at a rate commensurate with the risk involved or based on independent appraisals.

For the years ended June 30, 2020 and 2019,

an impairment of $127,177 and nil were recorded, respectively.

The carrying value of a long-lived asset is considered

impaired by the Company when the anticipated undiscounted cash flows from such asset is less than its carrying value.

If impairment is

identified, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset.

value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved or based on independent

For the years ended June 30, 2021 and 2020, an impairment of $ 855,230 and $ 127,177 were recorded, respectively.

Intangible Assets, net

assets are recorded at cost less accumulated amortization.

Amortization is calculated on a straight-line basis over the following

estimated useful lives:

Company evaluates intangible assets for impairment whenever events or changes in circumstances indicate that the assets might

For the years ended June 30, 2020 and 2019, an impairment of $200,455 and nil were recorded, respectively.

Amortization is calculated on a straight-line basis over the following estimated

useful lives:

Company evaluates intangible assets for impairment whenever events or changes in circumstances indicate that the assets might be impaired.

the years ended June 30, 2021 and 2020, an impairment of nil and $ 200,455 were recorded, respectively.

Revenue Recognition

2 unchanged sentences

The Company identifies contractual performance obligations and determines

whether revenue should be recognized at a point in time or over time, based on when control of goods and services transfers to

The Company’s revenue streams are recognized at a point in time.

whether revenue should be recognized at a point in time or over time, based on when control of goods and services transfers to a customer.

The Company’s revenue streams are recognized at a point in time.

Company uses a five-step model to recognize revenue from customer contracts.

The five-step model requires that the Company (i)

identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction

price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv)

allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as)

the Company satisfies the performance obligation.

Company continues to derive its revenues from sales contracts with its customers with revenues being recognized upon performance

The five-step model requires the Company to (i) identify

the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including

variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction

price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance

Company continues to derive its revenues from sales contracts with its customers with revenues being recognized upon performance of services.

Persuasive evidence of an arrangement is demonstrated via sales contract and invoice;

and the sales price to the

customer is fixed upon acceptance of the sales contract and there is no separate sales rebate, discount, or other incentive.

Company’s revenues are recognized at a point in time after all performance obligations are satisfied.

and the sales price to the customer is fixed upon

acceptance of the sales contract and there is no separate sales rebate, discount, or other incentive.

The Company’s revenues

are recognized at a point in time after all performance obligations are satisfied.

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

Deferred revenue consists

primarily of customer billings made in advance of performance obligations being satisfied and revenue being recognized.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

of June 30, 2020, the Company had outstanding contracts amounting to approximately $1.6 million, all of which is expected to be

completed within 6 months from June 30, 2020.

The Company’s disaggregated revenue streams are described

For the Years Ended

Shipping and management agency services

Inland transportation management services

Freight logistics services

Container trucking services

from shipping and management agency services are recognized upon completion of services, which coincides with the date

of departure of the relevant vessel from port.

Advance payments and deposits received from customers prior to the provision

of services and recognition of the related revenues are presented as deferred revenue.

Revenues from inland

transportation management services are recognized when commodities are being released from the customers’

from freight logistics services are recognized when the related contractual services are rendered.

certain freight logistics contracts that the Company entered into with customers starting in the first quarter of fiscal

year 2020, the Company (i) acts as an agent in arranging the relationship between the customer and the third-party service

provider and (ii) does not control the services rendered to the customers, revenues related to this contracts are presented

net of related costs.

For the year ended June 30, 2020, gross revenue and gross cost of revenue related to these contracts

amounted to approximately $25.8 million and $24.3 million, respectively.

revenue consists primarily of customer billings made in advance of performance obligations being satisfied and revenue being recognized.

Company’s disaggregated revenue streams are described as follows:

the Years Ended

and management agency services

logistics services

trucking services

Revenues from shipping

and management agency services are recognized upon completion of services, which coincides with the date of departure of the relevant

vessel from port.

Advance payments and deposits received from customers prior to the provision of services and recognition of the

related revenues are presented as deferred revenue.

● Revenues from freight logistics services are recognized when the related contractual services are rendered.

For certain freight logistics contracts that the Company entered into with customers starting in the first quarter of fiscal year 2020, the Company (i) acts as an agent in arranging the relationship between the customer and the third-party service provider and (ii) does not control the services rendered to the customers, revenues related to this contracts are presented net of related costs.

For the year ended June 30, 2020, gross revenue and gross cost of revenue related to these contracts amounted to approximately $ 25.8 million and $ 24.3 million, respectively.

There was no such transaction for the year ended June 30, 2021.

Revenues from container

trucking services are recognized when the related contractual services are rendered.

Disaggregated information of revenues by

geographic locations are as follows:

Total revenues

Disaggregated

information of revenues by geographic locations are as follows:

the Years Ended

the Company and its subsidiaries and Sino-China were incorporated in different jurisdictions, they file separate income tax returns.

The Company uses the asset and liability method of accounting for income taxes in accordance with U.S.

Deferred taxes, if

any, are recognized for the future tax consequences of temporary differences between the tax basis of assets and liabilities and

their reported amounts in the consolidated financial statements.

A valuation allowance is provided against deferred tax assets

if it is more likely than not that the asset will not be utilized in the future.

Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will

be sustained on examination by the taxing authorities, based on the technical merits of the position.

The Company recognizes interest

and penalties, if any, related to unrecognized tax benefits as income tax expense.

The Company had no uncertain tax positions

as of June 30, 2020 and 2019.

Deferred taxes, if any,

are recognized for the future tax consequences of temporary differences between the tax basis of assets and liabilities and their reported

amounts in the consolidated financial statements.

A valuation allowance is provided against deferred tax assets if it is more likely

than not that the asset will not be utilized in the future.

Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained

on examination by the taxing authorities, based on the technical merits of the position.

The Company recognizes interest and penalties,

if any, related to unrecognized tax benefits as income tax expense.

The Company had no uncertain tax positions as of June 30, 2021 and

tax returns for the years prior to 2017 are no longer subject to examination by U.S.

tax authorities.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

Enterprise Income Tax

enterprise income tax is calculated based on taxable income determined under the PRC Generally Accepted Accounting Principles

(“PRC GAAP”) at 25%.

Sino-China and Trans Pacific are registered in PRC and governed by the Enterprise Income Tax

Laws of the PRC.

enterprise income tax is calculated based on taxable income determined under the PRC Generally Accepted Accounting Principles (“PRC

GAAP”) at 25 %.

Sino-China and Trans Pacific are registered in PRC and governed by the Enterprise Income Tax Laws of the PRC.

Value Added Taxes and Surcharges

Company is subject to value added tax (“VAT”).

Revenue from services provided by the Company’s PRC subsidiaries

and affiliates, including Sino-China and Trans Pacific are subject to VAT at rates ranging from 9% to 13%.

Entities that are VAT

general taxpayers are allowed to offset qualified VAT paid to suppliers against their VAT liability.

Net VAT liability is recorded

in taxes payable on the consolidated balance sheets.

addition, under the PRC regulations, the Company’s PRC subsidiaries and affiliates are required to pay the city construction

tax (7%) and education surcharges (3%) based on the net VAT payments.

Company is subject to value added tax (“VAT”).

Revenue from services provided by the Company’s PRC subsidiaries and

affiliates, including Sino-China and Trans Pacific are subject to VAT at rates ranging from 9% to 13%.

Entities that are VAT general

taxpayers are allowed to offset qualified VAT paid to suppliers against their VAT liability.

Net VAT liability is recorded in taxes payable

on the consolidated balance sheets.

addition, under the PRC regulations, the Company’s PRC subsidiaries and affiliates are required to pay the city construction tax

( 7 %) and education surcharges ( 3 %) based on the net VAT payments.

Earnings (loss) per Share

earnings (loss) per share is computed by dividing net income (loss) attributable to holders of common stock of the Company by

the weighted average number of shares of common stock of the Company outstanding during the applicable period.

Diluted earnings

(loss) per share reflect the potential dilution that could occur if securities or other contracts to issue common stock of the

Company were exercised or converted into common stock of the Company.

Common stock equivalents are excluded from the computation

of diluted earnings per share if their effects would be anti-dilutive.

the years ended June 30, 2020 and 2019, there was no dilutive effect of potential shares of common stock of the Company because

the Company generated a net loss.

earnings (loss) per share is computed by dividing net income (loss) attributable to holders of common stock of the Company by the weighted

average number of shares of common stock of the Company outstanding during the applicable period.

Diluted earnings (loss) per share reflect

the potential dilution that could occur if securities or other contracts to issue common stock of the Company were exercised or converted

into common stock of the Company.

Common stock equivalents are excluded from the computation of diluted earnings per share if their effects

would be anti-dilutive.

the years ended June 30, 2021 and 2020, there was no dilutive effect of potential shares of common stock of the Company because the Company

generated net loss.

Comprehensive Income (Loss)

Company reports comprehensive income (loss) in accordance with the authoritative guidance issued by Financial Accounting Standards

Board (the “FASB”) which establishes standards for reporting comprehensive income (loss) and its component in financial

Other comprehensive income (loss) refers to revenue, expenses, gains and losses that under US GAAP are recorded as

an element of Stockholders’

Company reports comprehensive income (loss) in accordance with the authoritative guidance issued by Financial Accounting Standards Board

(the “FASB”) which establishes standards for reporting comprehensive income (loss) and its component in financial statements.

Other comprehensive income (loss) refers to revenue, expenses, gains and losses that under US GAAP are recorded as an element of stockholders’

equity but are excluded from net income.

Other comprehensive income (loss) consists of a foreign

currency translation adjustment resulting from the Company not using the U.S.

Other comprehensive income (loss) consists of a foreign currency translation adjustment resulting

from the Company not using the U.S.

dollar as its functional currencies.

Stock-based Compensation

Company accounts for stock-based compensation awards to employees in accordance with FASB ASC Topic 718, “Compensation –

Stock Compensation”, which requires that stock-based payment transactions with employees be measured based on the grant-date

fair value of the equity instrument issued and recognized as compensation expense over the requisite service period.

records stock-based compensation expense at fair value on the grant date and recognizes the expense over the employee’s

requisite service period.

Company accounts for stock-based compensation awards to employees in accordance with FASB ASC Topic 718, “Compensation –

Stock Compensation”, which requires that stock-based payment transactions with employees be measured based on the grant-date fair

value of the equity instrument issued and recognized as compensation expense over the requisite service period.

The Company records stock-based

compensation expense at fair value on the grant date and recognizes the expense over the employee’s requisite service period.

Company accounts for stock-based compensation awards to non-employees in accordance with FASB ASC Topic 718 amended by ASU 2018-07.

Under FASB ASC Topic 718, stock compensation granted to non-employees has been determined as the fair value of the consideration

received or the fair value of equity instrument issued, whichever is more reliably measured and is recognized as an expense as

the goods or services are received.

of stock based compensation are based upon highly subjective assumptions about the future, including stock price volatility and

exercise patterns.

FASB ASC Topic 718, stock compensation granted to non-employees has been determined as the fair value of the consideration received or

the fair value of equity instrument issued, whichever is more reliably measured and is recognized as an expense as the goods or services

are received.

of stock based compensation are based upon highly subjective assumptions about the future, including stock price volatility and exercise

The fair value of share-based payment awards was estimated using the Black-Scholes option pricing model.

volatilities are based on the historical volatility of the Company’s stock.

The Company uses historical data to estimate

option exercise and employee terminations.

The expected term of options granted represents the period of time that options granted

are expected to be outstanding.

Expected volatilities

are based on the historical volatility of the Company’s stock.

The Company uses historical data to estimate option exercise and

employee terminations.

The expected term of options granted represents the period of time that options granted are expected to be outstanding.

The risk-free rate for periods within the expected life of the option is based on the U.S.

yield curve in effect at the time of the grant.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

Treasury yield curve in effect at the time

of the grant.

Risks and Uncertainties

Company’s business, financial position and results of operations may be influenced by the political, economic, health and

legal environments in the PRC, as well as by the general state of the PRC economy.

The Company’s operations in the PRC are

subject to special considerations and significant risks not typically associated with companies in North America and Western Europe.

These include risks associated with, among others, the political, economic, health and legal environments and foreign currency

The Company’s results may be adversely affected by changes in the political, regulatory and social conditions

in the PRC, and by changes in governmental policies or interpretations with respect to laws and regulations, anti-inflationary

measures, currency conversion, remittances abroad, and rates and methods of taxation, among other things.

Company’s business, financial position and results of operations may be influenced by the political, economic, health and legal

environments in the PRC, as well as by the general state of the PRC economy.

The Company’s operations in the PRC are subject to

special considerations and significant risks not typically associated with companies in North America and Western Europe.

These include

risks associated with, among others, the political, economic, health and legal environments and foreign currency exchange.

The Company’s

results may be adversely affected by changes in the political, regulatory and social conditions in the PRC, and by changes in governmental

policies or interpretations with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad,

and rates and methods of taxation, among other things.

March 2020, the World Health Organization declared the COVID-19 as a pandemic.

Given the rapidly expanding nature of the COVID-19

pandemic, and because substantially all of the Company’s business operations and our workforce are concentrated in China

and United States, the Company’s business, results of operations, and financial condition have been adversely affected for

the rest of fiscal year 2020 and beyond.

assessing the Company’s liquidity, the Company monitors and analyzes its cash on-hand and its operating and capital

expenditure commitments.

The Company’s liquidity needs are to meet its working capital requirements, operating expenses

and capital expenditure obligations.

As of June 30, 2020, the Company’s working capital deficit was approximately $3.9

million and the Company had cash of approximately $0.1 million.

The Company plans to fund continuing operations through

identifying new prospective joint venture partners and strategic alliance opportunities for new revenue sources, and by

reducing costs to improve profitability and replenish working capital.

The Company’s ability to fulfill its current

obligations will depend on the future realization of its current assets and the future revenues generated from its

Company expects to realize the balance of its current assets within the normal operating cycle of a twelve month period.

Company is unable to realize its current assets within the normal operating cycle of a twelve month period, the Company had considered supplementing its available sources of funds through the following sources:

the Company will continuously seek equity

financing to support its working capital;

On November 13, 2019, the Company entered into a cooperation agreement with Shanming

Liang, a director of Guangxi Jinqiao Industrial Group Co., Ltd., to cooperate and expand the bulk cargo container services business.

Shanming Liang agreed to purchase 200,000 shares of the Company’s common stock at a purchase price of $5.00 per share for

aggregate proceeds of $1.0 million pursuant to a stock purchase agreement dated November 14, 2019.

The company received gross proceeds

of $940,131 for fiscal year 2020.

From July to September 2020, the Company received remaining proceeds of $59,869.

The full amount

of subscription receivable have been paid off.

On September 17, 2020, the Company entered

into certain securities purchase agreement with certain non-U.S.

Persons to purchase 720,000 Shares at a per share purchase price

of $1.46 for aggregate proceeds of approximately $1.05 million.

On September 21 and September 22, 2020, the Company received total

gross proceeds of approximately $1.05 million.

other available sources of financing from PRC banks and other financial institutions;

financial support and credit guarantee commitments from the Company’s shareholders and directors.

on the above considerations, the Company’s management is of the opinion that it will not have sufficient funds to meet

the Company’s working capital requirements and current liabilities as they become due one year from issuance of these

consolidated financial statements.

There is no assurance that management will be successful in their plans.

number of factors that could potentially arise that could undermine the Company’s plans, such as changes in the PRC

government policy, economic conditions, and competitive pricing in the industries that the Company operates in.

the recent outbreak of new coronavirus pandemic posed disruption and restrictions on its operations and those of the

Company’s customers which not only negatively impact the Company’s financial conditions but also slowed down the

macro-economic development worldwide.

If management is unable to execute this plan, there would likely be a material adverse

effect on the Company’s business.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

The management has considered whether there is substantial doubt

about its ability to continue as a going concern due to 1) the Company’s recurring losses from operations, including approximately

$16.5 million net loss attributable to the Company’s stockholders for the year ended June 30, 2020, 2) accumulated deficit

of approximately $23.4 million as of June 30, 2020, and 3) has negative operating cash flows of approximately $3.9 million for

the year ended June 30, 2020.

All of these factors raise substantial doubt about the ability of the Company to continue as a going

Given the rapidly expanding nature of the COVID-19 pandemic,

and because substantially all of the Company’s business operations and the workforce are concentrated in China and United States,

the Company’s business, results of operations, and financial condition have been adversely affected for the year ended June 30,

The situation remains highly uncertain for any further outbreak or resurgence of the COVID-19.

It is therefore difficult for the

Company to estimate the impact on the business or operating results that might be adversely affected by any further outbreak or resurgence

Recent Accounting Pronouncements

Pronouncements

February 2016, the FASB issued Accounting Standards Update (“ASU”) No.

2016-02, Leases (Topic 842), to increase the

transparency and comparability about leases among entities.

The new guidance requires lessees to recognize a lease liability and

a corresponding lease asset for virtually all lease contracts.

It also requires additional disclosures about leasing arrangements.

ASU 2016-02 is effective for interim and annual periods beginning after December 15, 2018, and requires a modified retrospective

approach to adoption assuming the Company will remain an emerging growth company at that date.

September 2017, the FASB issued ASU No.

2017-13, which to clarify effective dates that public business entities and other entities

were required to adopt ASC Topic 842 for annual reporting.

A public business entity that otherwise would not meet the definition

of a public business entity except for a requirement to include or the inclusion of its financial statements or financial information

in another entity’s filing with the SEC adopting ASC Topic 842 for annual reporting periods beginning after December 15,

2019, and interim reporting periods within annual reporting periods beginning after December 15, 2020.

2017-13 also amended

that all components of a leveraged lease be recalculated from inception of the lease based on the revised after tax cash flows

arising from the change in the tax law, including revised tax rates.

The difference between the amounts originally recorded and

the recalculated amounts must be included in income of the year in which the tax law is enacted.

The Company adopted this ASU

in the first quarter of fiscal year 2020 using modified retrospective transition approach at the beginning of the period of adoption.

The Company recognized lease liabilities of approximately $0.3 million, with corresponding right-of use (“ROU”) assets

of approximately the same amount based on the present value of the future minimum rental payments of leases, using a weighted

average discount rate of approximately 8.98%.

July 1, 2019, the Company adopted ASU 2018-07 where awards to nonemployees are measured by estimating the fair value of the equity

instruments to be issued.

The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor

acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards which

superseded ASU 505-50.

The ASU is required to be applied on a prospective basis to all new awards granted after the date of adoption.

The Company adopted this ASU on July 1, 2019 and the adoption has no significant impact to the Company’s consolidated financial

statements as a whole.

August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820):

Disclosure Framework—Changes to the Disclosure

Requirements for Fair Value Measurement” (“ASU 2018-13”).

ASU 2018-13 removes, modifies and adds certain disclosure

requirements in Topic 820 “Fair Value Measurement”.

ASU 2018-13 eliminates certain disclosures related to transfers and the

valuations process, modifies disclosures for investments that are valued based on net asset value, clarifies the measurement uncertainty

disclosure, and requires additional disclosures for Level 3 fair value measurements.

The Company adopted this ASU on July 1, 2020 and

the adoption has no significant impact to the Company’s consolidated financial statements as a whole.

Pronouncements

not yet adopted

August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820):

Disclosure Framework—Changes to the

Disclosure Requirements for Fair Value Measurement”

(“ASU 2018-13”).

ASU 2018-13 removes, modifies and adds

certain disclosure requirements in Topic 820 “Fair Value Measurement”.

ASU 2018-13 eliminates certain disclosures

related to transfers and the valuations process, modifies disclosures for investments that are valued based on net asset value,

clarifies the measurement uncertainty disclosure, and requires additional disclosures for Level 3 fair value measurements.

2018-13 is effective for the Company for annual and interim reporting periods beginning July 1, 2020.

The Company does not believe

the adoption of this ASU will have a material effect on the Company’s consolidated financial statements.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

May 2019, the FASB issued ASU 2019-05, which is an update to ASU Update No.

2016-13, Financial Instruments—Credit Losses

Measurement of Credit Losses on Financial Instruments, which introduced the expected credit losses methodology for

the measurement of credit losses on financial assets measured at amortized cost basis, replacing the previous incurred loss methodology.

The amendments in Update 2016-13 added Topic 326, Financial Instruments—Credit Losses, and made several consequential amendments

to the Codification.

Update 2016-13 also modified the accounting for available-for-sale debt securities, which must be individually

assessed for credit losses when fair value is less than the amortized cost basis, in accordance with Subtopic 326-30, Financial

Instruments—

Credit Losses—Available-for-Sale Debt Securities.

The amendments in this ASU address those stakeholders’

concerns by providing an option to irrevocably elect the fair value option for certain financial assets previously measured at

amortized cost basis.

For those entities, the targeted transition relief will increase comparability of financial statement information

by providing an option to align measurement methodologies for similar financial assets.

Furthermore, the targeted transition relief

also may reduce the costs for some entities to comply with the amendments in Update 2016-13 while still providing financial statement

users with decision-useful information.

In May 2019, the FASB issued ASU 2019-05, which

is an update to ASU Update No.

2016-13, Financial Instruments—Credit Losses (Topic 326):

Measurement of Credit Losses on Financial

Instruments, which introduced the expected credit losses methodology for the measurement of credit losses on financial assets measured

at amortized cost basis, replacing the previous incurred loss methodology.

The amendments in Update 2016-13 added Topic 326, Financial

Instruments—Credit Losses, and made several consequential amendments to the Codification.

Update 2016-13 also modified the accounting

for available-for-sale debt securities, which must be individually assessed for credit losses when fair value is less than the amortized

cost basis, in accordance with Subtopic 326-30, Financial Instruments— Credit Losses—Available-for-Sale Debt Securities.

amendments in this ASU address those stakeholders’ concerns by providing an option to irrevocably elect the fair value option for

certain financial assets previously measured at amortized cost basis.

For those entities, the targeted transition relief will increase

comparability of financial statement information by providing an option to align measurement methodologies for similar financial assets.

Furthermore, the targeted transition relief also may reduce the costs for some entities to comply with the amendments in Update 2016-13

while still providing financial statement users with decision-useful information.

In November 2019, the FASB issued ASU No.

2019-10, which to update the effective date

2016-13 for private companies, not-for-profit organizations and certain smaller reporting companies applying for credit

losses standard.

The new effective date for these preparers is for fiscal years beginning after July 1, 2023, including interim

periods within those fiscal years.

2019-10, which

to update the effective date of ASU No.

2016-13 for private companies, not-for-profit organizations and certain smaller reporting companies

applying for credit losses standard.

The new effective date for these preparers is for fiscal years beginning after July 1, 2023, including

interim periods within those fiscal years.

The Company has not early adopted this update and it will become effective on July 1, 2023

assuming the Company will remain eligible to be smaller reporting company.

The Company is currently evaluating the impact of this

new standard on Company's consolidated financial statements and related disclosures.

The Company is currently evaluating the impact

of this new standard on its consolidated financial statements and related disclosures.

December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes”.

The amendments in this Update simplify the accounting for income taxes by removing certain exceptions to the general principles

in Topic 740.

The amendments also improve consistent application of and simplify GAAP for other areas of Topic 740 by clarifying

and amending existing guidance.

ASU 2019-12 is effective for the Company for annual and interim reporting periods beginning July

Early adoption of the amendments is permitted, including adoption in any interim period for public business entities

for periods for which financial statements have not yet been issued.

An entity that elects to early adopt the amendments in an

interim period should reflect any adjustments as of the beginning of the annual period that includes that interim period.

Additionally,

an entity that elects early adoption must adopt all the amendments in the same period.

The Company is currently evaluating the

impact of this new standard on Company’s consolidated financial statements and related disclosures.

Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a

material effect on the Company’s consolidated financial statements.

Reclassification

prior year amounts have been reclassified to conform to the current year presentation mainly reclassifying advances to suppliers

to other receivables (see Note 4 and 5).

These reclassifications have no effect on the reported revenues, net loss or total assets.

The Company evaluating the impact of this new standard will

have on Company’s consolidated financial statements and related disclosures.

In December 2019, the FASB issued ASU 2019-12,

“Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes”.

The amendments in this Update simplify the accounting

for income taxes by removing certain exceptions to the general principles in Topic 740.

The amendments also improve consistent application

of and simplify GAAP for other areas of Topic 740 by clarifying and amending existing guidance.

ASU 2019-12 is effective for the Company

for annual and interim reporting periods beginning July 1, 2021.

Early adoption of the amendments is permitted, including adoption in

any interim period for public business entities for periods for which financial statements have not yet been issued.

An entity that elects

to early adopt the amendments in an interim period should reflect any adjustments as of the beginning of the annual period that includes

that interim period.

Additionally, an entity that elects early adoption must adopt all the amendments in the same period.

believes the adoption of this new standard will not have a material impact on Company’s consolidated financial statements and related

In August 2020, the FASB issued ASU 2020-06, “Debt—Debt

with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”.

The amendments in this Update to

address issues identified as a result of the complexity associated with applying generally accepted accounting principles for certain

financial instruments with characteristics of liabilities and equity.

ASU 2020-06 is effective for the Company for annual and interim

reporting periods beginning July 1, 2022.

Early adoption is permitted, but no earlier than fiscal years beginning after July 1, 2021,

including interim periods within those fiscal years.

An entity that elects to early adopt the amendments in an interim period should reflect

any adjustments as of the beginning of the annual period that includes that interim period.

The Company believes the adoption of this

new standard will not have a material impact on Company’s consolidated financial statements and related disclosures.

In October 2020, the FASB issued ASU 2020-08,

“Codification Improvements to Subtopic 310-20, Receivables—Nonrefundable Fees and Other Costs”.

The amendments in this

Update represent changes to clarify the Codification.

The amendments make the Codification easier to understand and easier to apply by

eliminating inconsistencies and providing clarifications.

ASU 2020-08 is effective for the Company for annual and interim reporting periods

beginning July 1, 2021.

Early application is not permitted.

All entities should apply the amendments in this Update on a prospective basis

as of the beginning of the period of adoption for existing or newly purchased callable debt securities.

These amendments do not change

the effective dates for Update 2017-08.

The Company believes the adoption of this new standard will not have a material impact on Company’s

consolidated financial statements and related disclosures.

In October 2020, the FASB issued ASU 2020-10,

“Codification Improvements”.

The amendments in this Update represent changes to clarify the Codification or correct unintended

application of guidance that are not expected to have a significant effect on current accounting practice or create a significant administrative

cost to most entities.

The amendments in this Update affect a wide variety of Topics in the Codification and apply to all reporting entities

within the scope of the affected accounting guidance.

ASU 2020-10 is effective for annual periods beginning after July 1, 2021 for public

business entities.

Early application is permitted.

The amendments in this Update should be applied retrospectively.

The Company believes

the adoption of this new standard will not have a material impact on Company’s consolidated financial statements and related disclosures.

Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material

effect on the Company’s consolidated financial statements.

CRYPTOCURRENCIES

following table presents additional information about cryptocurrencies:

at June 30, 2020

of cryptocurrencies from mining services

at June 30, 2021

ACCOUNTS RECEIVABLE, NET

Company’s net accounts receivable are as follows:

Trade accounts receivable

Company’s net accounts receivable are as follows:

accounts receivable

allowances for doubtful accounts

Accounts receivable, net

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

( 3,475,769 )

( 2,297,491 )

receivable, net

of allowance for doubtful accounts are as follows:

1 unchanged sentence

Provision for doubtful accounts, net of recovery

( 8,220,754 )

Exchange rate effect

Ending balance

the years ended June 30, 2020 and 2019, the provision for doubtful accounts was $4,996,006 and $4,091,056, respectively.

recovered $99,366 and nil of accounts receivable for the years ended June 30, 2020 and 2019, respectively.

The Company wrote off

$8,220,754 and nil of accounts receivable for the years ended June 30, 2020 and 2019, respectively.

For the years ended June 30, 2021 and 2020, the

provision for doubtful accounts was $ 1,033,407 and $ 4,996,606 , respectively.

The Company recovered $ 2,512 and $ 99,366 of accounts receivable

for the years ended June 30, 2021 and 2020, respectively.

The Company wrote off nil and $ 8,220,754 of accounts receivable for the years

ended June 30, 2021 and 2020, respectively.

OTHER RECEIVABLES, NET

Company’s other receivables are as follows:

Advances to customers*

Employee business advances

Security deposit

allowances for doubtful accounts

( 6,024,266 )

Other receivables, net

As of June 30, 2020, the Company entered into certain contracts with customers (state-owned entities) where the Company’s services included freight costs and cost of commodities to be shipped to customers’

designated locations.

The Company prepaid the costs of commodities and recognized as advance payments on behalf of its customers.

These advance payments on behalf of the customers will be repaid to the Company when either the contract terms are expired or the contracts are terminated by the Company.

As our customers were negatively impacted by the pandemic and required additional time to execute existing contracts, they required additional time to pay.

Due to significant uncertainty on whether the delayed contracts will be executed timely.

As such, the Company provided an allowance due to contract delay and recorded allowances of approximately $10.0 million.

Movement of allowance

for doubtful accounts are as follows:

( 10,005,193 )

Other receivables, net – continuing operations

* As of June 30, 2021 and 2020, the Company entered into certain contracts

with customers (state-owned entities) where the Company’s services included freight costs and cost of commodities to be shipped

to customers’ designated locations.

The Company prepaid the costs of commodities and recognized as advance payments on behalf of

its customers.

These advance payments on behalf of the customers will be repaid to the Company when either the contract terms are expired

or the contracts are terminated by the Company.

As aforementioned customers were negatively impacted by the pandemic and required additional

time to execute existing contracts, they required additional time to pay.

Due to significant uncertainty on whether the delayed contracts

will be executed timely.

As such, the Company had provided an allowance due to contract delay and recorded allowances of approximately

$ 10.0 million for the year ended June 30, 2020.

For the year ended June 30, 2021, the Company recovered $4,786,814 of the reserved amount.

of allowance for doubtful accounts are as follows:

Beginning balance

Provision for doubtful accounts

Provision (recovery) for doubtful accounts

( 4,786,814 )

Exchange rate effect

Ending balance

For the years ended June 30, 2020 and 2019, the provision for

doubtful accounts was $10,055,203 and nil, respectively.

The Company wrote off $1,763 and nil of other receivables for the years

ended June 30, 2020 and 2019, respectively.

the year ended June 30, 2021 and 2020, the provision for doubtful accounts of other receivables was nil and $ 10,055,203 , respectively.

The Company recovered $ 4,786,814 and nil of other receivables for the years ended June 30, 2021 and 2020.

For the years ended June 30,

2021 and 2020, the Company wrote off $ 11,665 and $ 1,763 of other receivables respectively.

ADVANCES TO SUPPLIERS

Company’s advances to suppliers –

third parties are as follows:

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

Freight fees (1)

Total advances to suppliers-third parties

The advanced freight

fee is the Company’s prepayment made for various shipping costs for shipments from July to September 2020.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

(1) The advanced freight fee is the Company’s prepayment made for various shipping costs for shipments from July to September 2021.

On December 1, 2020, the Company entered into a freight logistics services and import contract with a third party for equipment import.

Per contract term, the Company will act as their freight carriers and in charge the import matter of such equipment.

The Company agreed to pay a deposit of $ 580,000 which is based on 20 % of the total carrying value of equipment on behalf of customer to secure the equipment.

The advance will be repaid to the Company when the contract is fulfilled in around December 2021

PREPAID EXPENSES AND OTHER CURRENT ASSETS

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

Prepaid income taxes

Other (including prepaid insurance, rent, listing fees)

Deposit for ERP (1)

Prepaid leasing and service fees (2)

current portion

Total noncurrent portion

On December 27,

2017, with the approval of the Board, the Company signed a contract with Tianjin Anboweiye Technology Ltd Co.

(“Tianjin

Anboweiye”), to develop a more complete ERP system based on the Company’s existing operations and projected future

In March 2018, the Company paid a deposit to start phase one of the development which includes upgraded accounting

and human resources modules, new order processing and customer relationship management system.

The Company paid a $437,357

deposit to Tianjin Anboweiye.

The total contract price for phase one amounted to RMB 4,000,000, approximately $583,000.

the year ended June 30, 2019, the Company utilized $218,679 of software development costs incurred during the preliminary

project stage, which included planning and determining the functionality of the software.

The Company integrated the shipping

agencies business with the current ERP platform and the first phase of the ERP system was placed in use in July 2019 and to

be amortized over three years (See Note 9).

As of June 30, 2020, all executed portion of the contract has been fully paid.

On March 31, 2020, the Company and the vendor agreed to terminate the unexecuted portions of the contract, as such, no payable

nor contractual obligation existed as of June 30, 2020.

On June 22, 2018,

the Company entered into a contract to improve its IT infrastructure.

The total contract consideration for the services is

$1.2 million and the Company paid a deposit of approximately $1.0 million.

The consideration is allocated as follows:

for operating hardware leasing of twelve months;

$480,000 for onsite services and IT consulting for a two-year period;

for operating system set up and $240,000 for continuing integration with the ERP system and data management for two years.

For the year ended June 30, 2020, the Company incurred $200,550 in IT for consulting costs, and $100,275 for continuing integration

of the ERP system and data management costs.

As of June 30, 2020, all executed portion of the contract has been fully paid.

On March 31, 2020, the Company and the vendor agreed to terminate the unexecuted portions of the contract, as such, no payable

nor contractual obligation existed as of June 30, 2020.

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

(including prepaid professional fees, rent, listing fees)

OTHER LONG-TERM ASSETS – DEPOSITS,

Company’s other long-term assets –

deposits are as follows:

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

Rental and utilities deposits

1 unchanged sentence

Total other long-term assets - deposits

customers require the Company to pay certain deposits for the security of shipments and merchandise.

These deposits are

refundable at the end of their respective contract term.

Approximately $2.8 million (RMB 20 million) of the balance was paid

to BaoSteel Resources Co., Ltd.

allowances for deposits

( 3,177,127 )

Other long-term assets- deposits, net

(1) Certain customers require the Company to pay certain deposits for the

security of shipments and merchandise.

These deposits are refundable at the end of their respective contract term.

Approximately $ 3.1

million (RMB 20 million) of the balance was paid to BaoSteel Resources Co., Ltd.

according to the agreement entered in March 2018.

This refundable deposit is to cover any

possible loss of merchandise, as well as any non-performance on the part of the Company and its vendors.

The restricted

deposit is expected be repaid to the Company when either the contract terms are expired by March 2023 or the contract is

refundable deposit is to cover any possible loss of merchandise, as well as any non-performance on the part of the Company and its vendors.

The restricted deposit is expected be repaid to the Company when either the contract terms are expired by March 2023 or the contract is

terminated by the Company.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

Due to impact of COVID-19 and recent rising freight costs, the Company has not been able to fulfill the contracts

and expect it may not be able to collect the full deposit, as such the Company provided full allowance for the $ 3.1 million deposit with

of allowance for deposits are as follows:

Beginning balance

Allowance for deposits

Exchange rate effect

Ending balance

PROPERTY AND EQUIPMENT, NET

Company’s net property and equipment as follows:

Motor vehicles*

7 unchanged sentences

and amortization expenses for the years ended June 30, 2021 and 2020 were $ 406,553 and $ 320,737 , respectively.

For the year ended

June 30, 2020, an impairment of $127,177 was recorded due to continued decrease in revenues from the

inland transportation management segment, no impairment was recorded for same period 2019.

* For the year ended June 30, 2021 and 2020, impairment of $ 855,230 and $ 127,177 was recorded due to continued decrease in revenues from the inland transportation management and container trucking segments and mining equipment which were not in use since June 2021 due to recent regulation change.

In addition, the Company disposed of one vehicle resulting in a loss from disposal of $ 6,312 .

INTANGIBLE ASSETS, NET

intangible assets consisted of the following:

Full service logistics platforms

service logistics platforms

Accumulated amortization

Intangible assets, net

full service logistics platform was placed in services in December 2017.

1 unchanged sentence

expenses amounted to $ 26,389 and $ 81,557 for the years ended June 30, 2021 and 2020, respectively.

addition, first phase of the ERP system (see more details in Note 6) was placed in use in July 2019 and is being amortized over

However, due to the continued decrease in revenues from the inland transportation management segment, the Company

recorded an impairment of $200,455 for the year ended June 30, 2020.

ACCRUED EXPENSES AND OTHER

CURRENT LIABILITIES

addition, first phase of the ERP system was placed in use in July 2019 and is being amortized over three years.

However, due to the continued

decrease in revenues from the inland transportation management segment, the Company recorded an impairment of $ 200,455 for the year ended

June 30, 2020.

No impairment was recorded for same period of 2021.

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Salary and reimbursement payable

1 unchanged sentence

Credit card payable

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

LOANS PAYABLE

1 unchanged sentence

Small Business Administration

(“SBA”) Paycheck Protection Program (“PPP”).

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 after eight weeks

(or an extended 24-week covered period) as long as the borrower uses the loan proceeds for eligible purposes, including payroll,

benefits, rent and utilities, and maintains its payroll levels.

The loan forgiveness amount will be reduced for any Economic Injury

Disaster Loan (“EIDL”) advance that the Company receives.

The amount of loan forgiveness will be further reduced if

the borrower terminates employees or reduces salaries during the eight-week period.

The Company intends to use the proceeds for

purposes consistent with the PPP.

While the Company currently believes that its use of the loan proceeds will meet the conditions

for forgiveness of the loan and intends to file for loan forgiveness before December 2020, there can be no assurance that the

full amount of the loan will be forgiven.

As of June 30, 2020, $124,570 of loan payable remains outstanding.

May 26, 2020, the Company received an advance in the amount of $155,900 from under the SBA EIDL program administered by the

SBA pursuant to the CARES Act.

Such advance amount will reduce the Company’s PPP loan forgiveness amount described

In accordance with the requirements of the CARES Act, the Company will use proceeds from the SBA loans primarily for

working capital to alleviate economic injury caused by disaster occurring in the month of January 31, 2020 and continuing

The SBA loans are scheduled to mature on May 22, 2050 and have a 3.75% interest rate and are subject to the terms

and conditions applicable to loans administered by the SBA under the CARES Act.

The monthly payable including principal and

interest, of $731 commencing on May 22, 2021.

The balance of principal and interest will be payable 30 years from the date of

May 22, 2020.

(“SBA”) Paycheck Protection Program (“PPP”).

The PPP, established as part of the Coronavirus Aid, Relief and

Economic Security Act (the “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 after eight weeks (or an extended

24-week covered period) as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities,

and maintains its payroll levels.

The loan forgiveness amount will be reduced for any Economic Injury Disaster Loan (“EIDL”)

advance that the Company receives.

The amount of loan forgiveness will be further reduced if the borrower terminates employees or reduces

salaries during the eight-week period.

On February 24, 2021, the full amount of PPP loan was forgiven and no principle or interest need

to be repaid, so the Company record such as a gain for the year ended June 30, 2021.

As of June 30, 2021, none of PPP loan payable remains

May 26, 2020, the Company received an advance in the amount of $ 155,900 from under the SBA EIDL program administered by the SBA pursuant

to the CARES Act.

Such advance amount will reduce the Company’s PPP loan forgiveness amount described above.

In accordance with

the requirements of the CARES Act, the Company will use proceeds from the SBA loans primarily for working capital to alleviate economic

injury caused by disaster occurring in the month of January 31, 2020 and continuing thereafter.

The SBA loans are scheduled to mature

on May 22, 2050 and have a 3.75% interest rate and are subject to the terms and conditions applicable to loans administered by the SBA

under the CARES Act.

The monthly payable of $731, including principal and interest, commenced on May 22, 2021.

The balance of principal

and interest will be payable 30 years from the date of May 22, 2020.

$5,900 of the loan will be forgiven.

As of June 30, 2020, $155,900 of loan payable remains outstanding.

Interest expense for the year ended June 30, 2020 for this loan was immaterial.

As of June 30, 2021, $155,405

of loan payable remains outstanding.

Interest expense for the year ended June 30, 2021 for this loan was $ 5,839 .

repayment schedule for the EIDL loans is as follows:

Twelve Months Ending June 30,

Total loan payments

Months Ending June 30,

loan payments

Company determines if a contract contains a lease at inception.

US GAAP requires that the Company’s leases be evaluated

and classified as operating or finance leases for financial reporting purposes.

The classification evaluation begins at the commencement

date and the lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use

the underlying asset, together with renewal option periods when the exercise of the renewal option is reasonably certain and failure

to exercise such option which result in an economic penalty.

All of the Company’s leases are classified as operating leases.

Company has several vehicle lease agreements and office lease agreements with lease terms ranging from two to three years.

adoption of ASU 2016-02, the Company recognized lease liabilities of approximately $0.3 million, with corresponding ROU assets

of approximately the same amount based on the present value of the future minimum rental payments of leases, using a weighted

average discount rate of approximately 8.98%.

As of June 30, 2020, ROU assets and lease liabilities amounted to $300,114 and $337,090

(including $204,391 from lease liabilities current portion and $132,699 from lease liabilities noncurrent portion), respectively.

Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

leases generally do not contain options to extend at the time of expiration and the weighted average remaining lease terms are

US GAAP requires that the Company’s leases be evaluated and classified

as operating or finance leases for financial reporting purposes.

The classification evaluation begins at the commencement date and the

lease term used in the evaluation includes the non-cancellable period for which the Company has the right to use the underlying asset,

together with renewal option periods when the exercise of the renewal option is reasonably certain and failure to exercise such option

which result in an economic penalty.

All of the Company’s leases are classified as operating leases.

The Company has several vehicle lease agreements and office lease agreements

with lease terms ranging from two to three years .

Upon adoption of ASU 2016-02, the Company recognized lease liabilities of approximately

$ 0.3 million, with corresponding ROU assets of approximately the same amount based on the present value of the future minimum rental payments

of leases, using a weighted average discount rate of approximately 10.35 %.

As of June 30, 2021, ROU assets and lease liabilities amounted

to $ 417,570 and $ 430,000 (including $ 192,044 from lease liabilities current portion and $ 237,956 from lease liabilities noncurrent portion),

respectively and weighted average discount rate was approximately 10.35 %.

The Company’s lease

agreements do not contain any material residual value guarantees or material restrictive covenants.

The leases generally do not contain

options to extend at the time of expiration and the weighted average remaining lease terms are 3.31 years.

the years ended June 30, 2021 and 2020, rent expense amounted to approximately $ 310,000 and $ 284,000 , respectively.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

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

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

Twelve Months Ending June 30,

Operating Lease Amount

Total lease payments

Present value of lease liabilities

Company’s outstanding warrants are classified as equity since they qualify for exception from derivative accounting as they

are considered to be indexed to the Company’s own stock and require net share settlement.

The fair value of the warrants

of $881,750 is valued based on the Black-Scholes-Merton model and is recorded as additional paid-in capital from common stock

based on the relative fair value of proceeds received using the following assumptions:

Annual dividend yield

Expected life (years)

Risk-free interest rate

Expected volatility

is a summary of the status of warrants outstanding and exercisable as of June 30, 2020:

Weighted Average

Warrants outstanding, as of June 30, 2019

Warrants outstanding, as of June 30, 2020

Warrants exercisable, as of June 30, 2020

Warrants Outstanding

2018 Series A, 400,000

On November 13, 2019,

the Company entered into a cooperation agreement with Shanming Liang, a director of Guangxi Jinqiao Industrial Group Co., Ltd.,

to cooperate and expand the bulk cargo container services business.

Shanming Liang agreed to purchase 200,000 shares of the Company’s

common stock at a purchase price of $5.00 per share for aggregate proceeds of $1.0 million.

November 13, 2019, the Company entered into a cooperation agreement with Shanming Liang, a director of Guangxi Jinqiao Industrial Group

Co., Ltd., to cooperate and expand the bulk cargo container services business.

Shanming Liang agreed to purchase 200,000 shares of the

Company’s common stock at a purchase price of $ 5.00 per share for aggregate proceeds of $ 1.0 million.

The Company and Mr.

Liang further entered

into a Share Purchase Agreement on November 14, 2019 to memorialize the transaction aforementioned.

further entered into a Share Purchase Agreement on November 14, 2019 to memorialize the transaction aforementioned.

Pursuant to the aforementioned

3 unchanged sentences

The full amount of subscription receivable has been paid off.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 9, 2019, the Company authorized the cancellation of the 35,099 of the Company’s treasury shares.

The shares were

cancelled as of June 30, 2020.

On December 9, 2019, the

Company authorized the cancellation of the 35,099 of the Company’s treasury shares.

The shares were cancelled as of June 30, 2020.

The cancellation has no effect on the Company's total shareholders' equity and earnings per share.

the close of the stock market on July 7, 2020, the Company effected a l-for-5 reverse stock split of its common stock in

order to satisfy continued listing requirements of its common stock on the NASDAQ Capital Market.

The reverse stock split was

approved by the Company’s board of directors and stockholders and was intended to allow the company to meet the minimum

share price requirement of $1.00 per share for continued listing on the NASDAQ Capital Market.

As a result all common stock

share amounts included in this filing have been retroactively reduced by a factor of five, and all common stock per share

amounts have been increased by a factor of five.

Amounts affected include common stock outstanding, including those that have

resulted from the stock options, and warrants that convert to common stock.

After the close of the stock market on July 7,

2020, the Company effected a l-for-5 reverse stock split of its common stock in order to satisfy continued listing requirements of its

common stock on the NASDAQ Capital Market.

The reverse stock split was approved by the Company’s board of directors and stockholders

and was intended to allow the company to meet the minimum share price requirement of $1.00 per share for continued listing on the NASDAQ

Capital Market.

As a result all common stock share amounts included in this filing have been retroactively reduced by a factor of five,

and all common stock per share amounts have been increased by a factor of five.

Amounts affected include common stock outstanding, including

those that have resulted from the stock options, and warrants that convert to common stock.

September 17, 2020, the Company entered into certain securities purchase agreement with certain “non-U.S.

Persons” as defined

in Regulation S of the Securities Act of 1933, as amended, pursuant to which the Company sold an aggregate of 720,000 shares of the Company’s

common stock, no par value, and warrants to purchase 720,000 Shares at a per share purchase price of $ 1.46 .

The net proceeds to the Company

from such offering were approximately $ 1.05 million.

The warrants will be exercisable on March 16, 2021 at an exercise price of $ 1.825

The warrants may also be exercised cashlessly if at any time after March 16, 2021, there is no effective registration statement

registering, or no current prospectus available for, the resale of the warrant shares.

The warrants will expire on March 16, 2026.

warrants are subject to anti-dilution provisions to reflect stock dividends and splits or other similar transactions.

The warrants contain

a mandatory exercise right for the Company to force exercise the warrants if the Company’s common stock trades at or above $4.38

for 20 consecutive trading days, provided, among other things, that the shares issuable upon exercise of the are registered or may be

sold pursuant to Rule 144 and the daily trading volume exceeds 60,000 shares of common stock per trading day on each trading day in a

period of 20 consecutive trading days prior to the applicable date.

November 2 and November 3, 2020, the Company issued an aggregate of 860,000 shares of Series A Convertible Preferred Stock (the “Series

A Preferred Stock”), each convertible into one share of common stock, no par value, of Company, upon the terms and subject to the

limitations and considerations set forth in the Certificate of Designation of the Series A Preferred Stock, and warrants to purchase

up to 1,032,000 shares of common stock.

The purchase price for each share of Series A Preferred Stock and accompanying warrants is $ 1.66 .

The net proceeds to the Company from this offering was approximately $ 1.43 million, not including any proceeds that may be received upon

cash exercise of the warrants.

The warrants will be exercisable six (6) months following the date of issuance at an exercise price of

$ 1.99 for cash.

The warrants may also be exercised cashlessly if at any time after the six-month anniversary of the issuance date, there

is no effective registration statement registering, or no current prospectus available for, the resale of the warrant Shares.

will expire five and a half ( 5.5 ) years from the date of issuance.

The warrants are subject to anti-dilution provisions to reflect stock

dividends and splits or other similar transactions.

The warrants contain a mandatory exercise right for the Company to force exercise

of the warrants if the closing price of the common stock equals or exceeds $ 5.97 for twenty (20) consecutive trading days, provided,

among other things, that the shares issuable upon exercise of the warrants are registered or may be sold pursuant to Rule 144 and the

daily trading volume exceeds 60,000 shares of common stock per trading day on each trading day in a period of 20 consecutive trading

days prior to the applicable date.

In February 2021, the shareholders approved the preferred shareholders’ right to convert 860,000

shares of Series A Preferred Stock into 860,000 shares of common stock in the Company’s annual meeting of shareholders.

30, 2021, the Series A Preferred Stock have been fully converted to common stock on a one-for-one basis.

December 8, 2020, the Company entered into a securities purchase agreement with the investors thereto pursuant to which the Company sold

to the investors, and the investors purchased from the Company, in a registered direct offering, an aggregate of 1,560,000 shares of

the common stock of the Company, no par value per share, at a purchase price of $ 3.10 per share, for aggregate gross proceeds to the

Company of $ 4,836,000 .

The Company also sold to the investors warrants to purchase up to an aggregate of 1,170,000 shares of common stock

at an exercise price of $ 3.10 per share.

The warrants are initially exercisable beginning on December 11, 2020 and will expire three

and a half ( 3.5 ) years from the date of issuance.

The exercise price and the number of shares of common stock issuable upon exercise

of the warrants are subject to adjustment in the event of stock splits or dividends, or other similar transactions, but not as a result

of future securities offerings at lower prices.

January 27, 2021, the Company entered into a securities purchase agreement with the non-U.S.

investors thereto pursuant to which the

Company sold to the investors, and the investors purchased from the Company, an aggregate of 1,086,956 shares of common stock, no par

value, and warrants to purchase 5,434,780 shares.

The net proceeds to the Company from such Offering were approximately $ 4.0 million.

The purchase price for each share of common stock and five warrants is $ 3.68 , and the exercise price per warrant is $ 5.00 .

will be exercisable at any time during the period beginning on or after July 27, 2021 and ending on or prior on January 27, 2026 but

not thereafter;

provided, however, that the total number of the Company’s issued and outstanding shares of Common Stock, multiplied

by the NASDAQ official closing bid price of the Common Stock shall equal or exceed $ 0.3 billion for a three consecutive month period

prior to an exercise.

February 6, 2021, the Company entered into a securities purchase agreement with the investors pursuant to which the Company sold to the

investors, and the investors purchased from the Company, in a registered direct offering, an aggregate of 1,998,500 shares of the common

stock of the Company, no par value per share, at a purchase price of $ 6.805 per share.

Net proceeds to the Company from the sale of the

shares and the warrants, after deducting estimated offering expenses and placement agent fees, were approximately $ 12.4 million.

Company also sold to the investors warrants to purchase up to an aggregate of 1,998,500 shares of common stock at an exercise price of

$ 6.805 per share.

The warrants shall be initially exercisable upon issuance and expire five and a half (5.5) years from the date of issuance.

The exercise price and the number of shares of common stock issuable upon exercise of the warrants are subject to adjustment in the event

of stock splits or dividends, or other similar transactions, but not as a result of future securities offerings at lower prices.

February 9, 2021, the Company entered into a securities purchase agreement with the investors pursuant to which the Company sold to the

investors, and the investors purchased from the Company, in a registered direct offering, an aggregate of 3,655,000 shares of the common

stock of the Company, no par value per share, at a purchase price of $ 7.80 per share.

Net proceeds to the Company from the sale of the

shares and the warrants, after deducting estimated offering expenses and placement agent fees, were approximately $ 26.1 million.

Company also sold to the investors warrants to purchase up to an aggregate of 3,655,000 shares of common stock at an exercise price of

$ 7.80 per share.

The warrants shall be initially exercisable upon issuance and expire five and a half (5.5) years from the date of issuance.

The exercise price and the number of shares of common stock issuable upon exercise of the warrants are subject to adjustment in the event

of stock splits or dividends, or other similar transactions, but not as a result of future securities offerings at lower prices.

the year ended June 30, 2021, the shareholders exercised warrants to purchase 1,791,666 shares of common stock, 1,532,869 shares are

issued of which 317,869 shares are exercised cashlessly, for aggregate net proceeds to the Company of approximately $ 4.8 million.

Company’s outstanding warrants are classified as equity since they qualify for exception from derivative accounting as they are

considered to be indexed to the Company’s own stock and require net share settlement.

The fair value of the warrants were recorded

as additional paid-in capital from common stock

is a summary of the status of warrants outstanding and exercisable as of June 30, 2021:

outstanding, as of June 30, 2020

( 1,791,666 )

outstanding, as of June 30, 2021

exercisable, as of June 30, 2021

Series A, 400,000

warrants, 2,922,000

warrants, 11,088,280

based compensation :

1 unchanged sentence

consulting services that include marketing program design and implementation and cooperative partner selection and management.

The service period began in March 2017 and will end in February 2020.

The Company issued 50,000 shares of common stock as remuneration

for the services, which were issued as restricted shares at $12.65 per share on March 22, 2017 to the consultant.

shares were valued at $632,500 and the consulting expense were $140,556 and $210,833 for the years ended June 30, 2020 and 2019,

respectively.

October 23, 2017, the Company issued to its employees 26,000 shares of its restricted common stock valued at $14.00 per share.

One quarter of the total number of common stock became vested on each of November 16, 2017, February 16, 2018, May 16, 2018 and

August 16, 2018.

$91,000 was recorded as compensation expense for the year ended June 30, 2019.

October 27, 2017, the Company issued 40,000 shares of restricted common stock on the grant date with an aggregated fair value

of $548,000 to a consulting company pursuant to a consulting agreement.

The scope of services primarily covered advising on business

development, strategic planning and compliance during the one-year service period from October 17, 2017 to October 16, 2018.

was recorded as compensation expense for the year ended June 30, 2019.

June 7, 2018, the Company issued 80,000 shares of common stock with a fair value of $508,000 to a consulting entity pursuant to

a service agreement.

The scope of services primarily covers legal consultation in PRC during the two-year service period from

July 2018 to June 2020.

period began in March 2017 and will end in February 2020.

The Company issued 50,000 shares of common stock as remuneration for the services,

which were issued as restricted shares at $ 12.65 per share on March 22, 2017 to the consultant.

These shares were valued at $ 632,500

and the consulting expense was $ 140,556 for the year ended June 30, 2020.

June 7, 2018, the Company issued 80,000 shares of common stock with a fair value of $ 508,000 to a consulting entity pursuant to a service

The scope of services primarily covers legal consultation in PRC during the two-year service period from July 2018 to June

The consulting entity is entitled to be granted the common stock on a quarterly basis in eight equal installments.

The Company recorded compensation expense of $254,000 for both years ended June 30, 2020 and 2019.

September 21, 2018, the Company issued 86,000 shares of common stock valued at $5.50 per share on the grant date with an aggregated

fair value of $473,000 under the 2014 Stock Incentive Plan (the “Plan”) to three employees, vesting immediately.

Company recorded compensation expense of $473,000 for the year ended June 30, 2019, respectively.

December 11, 2018, the Company issued 40,000 shares of common stock valued at $4.45 per share on the grant date with a fair value

of $178,000 under the 2014 Stock Incentive Plan to three employees, vesting immediately.

The Company recorded compensation expense

of $178,000 for the year ended June 30, 2019.

November 7, 2018, the Board of the Company approved the issuance of 10,000 shares of restricted common stock to a consultant pursuant

to an existing consulting agreement.

The scope of services primarily covers advising on business development, strategic planning

and corporate finance.

The grant’s fair value of approximately $65,000 was amortized during the remaining service period

from November 3, 2018 to May 2, 2019.

The Company recorded compensation expense of $65,000 for the year ended June 30, 2019.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2018, the Board of the Company and the Compensation Committee of the Board (the “Committee”) approved

(i) an increase in the annual salaries of Lei Cao, Chief Executive Officer, Tuo Pan, acting Chief Financial Officer, and Zhikang

Huang, Chief Operating Officer (the “C-Level Executives”), effective January 1, 2019, and (ii) a one-time award of

a total of 190,000 of the common stock from the shares reserved under the Company’s 2014 Stock Incentive Plan (the “Plan”)

to the C-Level Executives, Chief Technology Officer, Yafei Li and the following members of the Board, effective December 31, 2018,

for their valuable contributions to the Company in fiscal 2018:

Jing Wang, Tieliang Liu and Bradley A.

The Committee

recommended and the Board determined to make the following stock grants under the Plan:

(i) Chief Executive Officer, Lei Cao,

is entitled to a one-time stock award grant of 80,000 shares, (ii) acting Chief Financial Officer, Tuo Pan, is entitled to a one-time

stock award grant of 28,000 shares, (iii) Chief Operating Officer, Zhikang Huang, is entitled to a one-time stock award grant

of 36,000 shares, (iv) Chief Technology Officer, Yafei Li is entitled to a one-time stock award grant of 16,000 shares, (v) Board

member Jing Wang is entitled to a one-time stock award grant of 10,000 shares, (vi) Board member Tieliang Liu is entitled to a

one-time stock award grant of 10,000 shares and (vii) Board member Bradley A.

Haneberg is entitled to a one-time stock award grant

of 10,000 shares.

The Company recorded compensation expense of $731,500 for the year ended June 30, 2019.

recorded compensation expense of $ 254,000 for the year ended June 30, 2020.

April 8, 2019, the Company entered into a consulting services agreement with a consulting entity, which provides management consulting

and advisory services.

The scope of services primarily covered advising on business development, strategic planning and compliance

during the six months service period from April 8, 2019 to October 7, 2019.

The Company issued 60,000 shares of common stock as

remuneration for the services, which were issued as restricted shares at $4.25 per share on April 16, 2019 to the consulting entity.

These shares were valued at $255,000.

The Company recorded compensation expense of $127,500 for both years ended June 30, 2020

July 1, 2019, the Company issued 120,000 restricted shares of common stock with a fair value of $432,000 to a China-based company

that specializes in the port agency business and/or its designees pursuant to a consulting service agreement.

The scope of services

primarily covers business consultation for one year from July 1, 2019 to June 30, 2020.

The Company can terminate the agreement

if they are not satisfy with the performance of the consulting firm and the consulting firm should return all the issued shares.

The scope of services primarily covered advising on business development, strategic planning and compliance during

the six months service period from April 8, 2019 to October 7, 2019.

The Company issued 60,000 shares of common stock as remuneration

for the services, which were issued as restricted shares at $4.25 per share on April 16, 2019 to the consulting entity.

were valued at $255,000.

The Company recorded compensation expense of $ 127,500 for the year ended June 30, 2020.

in a Board resolution dated January 30, 2016, the Company’s CEO is authorized to grant to the employees up to one million

shares under the Plan.

On July 22, 2019, the Company granted 18,000 shares of restricted common stock valued at $3.50 per share

on the grant date with an aggregated fair value of $63,000 under the Plan to one employee, vesting immediately.

July 1, 2019, the Company issued 120,000 restricted shares of common stock with a fair value of $ 432,000 to a China-based company that

specializes in the port agency business and/or its designees pursuant to a consulting service agreement.

The scope of services primarily

covers business consultation for one year from July 1, 2019 to June 30, 2020.

The Company can terminate the agreement if they are not

satisfy with the performance of the consulting firm and the consulting firm should return all the issued shares.

The Company recorded

compensation expense of $ 432,000 for the year ended June 30, 2020.

August 26, 2019, the Company issued 8,000 shares of common stock valued at $3.60 per share on the grant date with an aggregated

fair value of $28,800 to Chineseinvestors.com as settlement of a breach of service contract lawsuit.

The Company recorded compensation

expense of $28,800 for the year ended June 30, 2020.

October 3, 2019, the Company issued 46,000 shares of common stock valued at $3.40 per share on the grant date with an aggregated

fair value of $156,400 under the Plan to one employee, vesting immediately.

The Company recorded compensation expense of $156,400

for the year ended June 30, 2020.

October 14, 2019, the Company entered into a consulting services agreement with a consulting entity, which provides management

consulting and advisory services.

The scope of services primarily covered advising on business development, strategic planning

and compliance during the six months service period from October 14, 2019 to April 13, 2020.

The Company issued 60,000 shares

of common stock valued at $222,000 as remuneration for the services.

The shares bear a standard restrictive legend under

the Securities Act of 1933, as amended.

in a Board resolution dated January 30, 2016, the Company’s CEO is authorized to grant to the employees up to one million shares

under the Company’s 2014 Stock Incentive Plan (the “Plan”).

On July 22, 2019, the Company granted 18,000 shares of

restricted common stock valued at $ 3.50 per share on the grant date with an aggregated fair value of $ 63,000 under the Plan to one employee,

vesting immediately.

The Company recorded compensation expense of $ 63,000 for the year ended June 30, 2020.

June 30, 2020, the Company issued 50,000 shares of common stock valued at $3.05 per share on the grant date with a fair value

of $152,500 under the 2014 Stock Incentive Plan to two employees, vesting immediately.

August 26, 2019, the Company issued 8,000 shares of common stock valued at $ 3.60 per share on the grant date with an aggregated fair

value of $ 28,800 to Chineseinvestors.com as settlement of a breach of service contract lawsuit.

The Company recorded compensation expense

of $ 28,800 for the year ended June 30, 2020.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

the years ended June 30, 2020 and 2019, $1,576,756 and $2,267,833 were recorded as stock-based compensation expense, respectively.

October 3, 2019, the Company issued 230,000 shares of common stock valued at $ 0.68 per share on the grant date with an aggregated fair

value of $ 156,400 under the Plan to one employee, vesting immediately.

The Company recorded compensation expense of $ 156,400 for the

year ended June 30, 2020.

October 14, 2019, the Company entered into a consulting services agreement with a consulting entity, which provides management consulting

and advisory services.

The scope of services primarily covered advising on business development, strategic planning and compliance during

the six months service period from October 14, 2019 to April 13, 2020.

The Company issued 300,000 shares of common stock valued at $ 222,000

as remuneration for the services.

The shares bear a standard restrictive legend under the Securities Act of 1933, as amended.

recorded compensation expense of $ 222,000 for the year ended June 30, 2020.

June 30, 2020, the Company issued 50,000 shares of common stock valued at $ 3.05 per share on the grant date with a fair value of $ 152,500

under the 2014 Stock Incentive Plan to two employees, vesting immediately.

The Company recorded compensation expense of $ 152,500 for

the year ended June 30, 2020.

the years ended June 30, 2021 and 2020, nil and $ 1,576,756 were recorded as stock-based compensation expense, respectively.

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

Weighted Average

Options outstanding, as of June 30, 2019

Cancelled, forfeited or expired

Options outstanding, as of June 30, 2020

Options exercisable, as of June 30, 2020

outstanding, as of June 30, 2020

forfeited or expired

outstanding, as of June 30, 2021

exercisable, as of June 30, 2021

is a summary of the status of options outstanding and exercisable at June 30, 2021:

1 unchanged sentence

NON-CONTROLLING INTEREST

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

Original paid-in capital

2 unchanged sentences

Accumulated deficit

( 6,266,337 )

( 6,199,188 )

( 5,894,103 )

( 5,465,346 )

Trans Pacific Logistics Shanghai Ltd.

1 unchanged sentence

( 1,077,015 )

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

Brilliant Warehouse Service, Inc.

$ ( 6,951,134 )

$ ( 6,542,361 )

COMMITMENTS AND CONTINGENCIES

Contingencies

Labor Contract Law of the PRC requires employers to insure the liability of the severance payments for terminated employees that

have worked for the employers for at least two years prior to January 1, 2008.

The employers will be liable for one month for

severance pay for each year of the service provided by the employees.

As of June 30, 2020 and 2019, the Company has estimated

its severance payments of approximately $84,000 and $94,000, respectively, which have not been reflected in its consolidated financial

statements, because management cannot predict what the actual payment, if any, will be in the future.

Labor Contract Law of the PRC requires employers to insure the liability of the severance payments for terminated employees that have

worked for the employers for at least two years prior to January 1, 2008.

The employers will be liable for one month for severance pay

for each year of the service provided by the employees.

As of June 30, 2021 and 2020, the Company has estimated its severance payments

of approximately $ 107,000 and $ 84,000 , respectively, which have not been reflected in its consolidated financial statements, because

management cannot predict what the actual payment, if any, will be in the future.

has employment agreements with each of Mr.

1 unchanged sentence

Zhikang Huang.

These employment agreements provide for

five-year terms that extend automatically in the absence of termination notice provided at least 60 days prior to the anniversary

date of the agreement.

If the Company fails to provide this notice or if the Company wishes to terminate an employment agreement

in the absence of cause, then the Company is obligated to provide at least 30 days’

prior notice.

In such case during the

initial term of the agreement, the Company would need to pay such executive (i) the remaining salary through the date of December

31, 2023, (ii) two times of the then applicable annual salary if there has been no Change in Control, as defined in the employment

agreements or three-and-half times of the then applicable annual salary if there is a Change in Control.

time to time, the Company is involved in routine litigation that arises in the ordinary course of business.

The Company was named

as a defendant in a breach of service contract lawsuit in the amount of $225,000 filed with the California Superior Court on January

The Company filed a motion with the court to force the plaintiff into arbitration rather than to litigate the dispute

in court based on the arbitration provision in the contract.

The California Superior Court approved its motion to stay the case

pending the resolution of the arbitration.

In Indianapolis, this matter was settled in exchange for 8,000 restrictive shares of

common stock of the Company to the plaintiff, by the execution of a settlement agreement by both parties on August 23, 2019 and

the issuance of 8,000 restricted shares on August 26, 2019.

As a result, the arbitration in Indianapolis and the litigation in

California has been dismissed respectively.

January 22, 2019, Nasdaq notified the Company that it did not comply with the minimum bid price of $1.00 per share (the “Minimum

Bid Price”) requirement in Listing Rule 5550(a)(2), and in accordance with Listing Rule 5810(c)(3)(A), was granted 180 calendar

days, until July 22, 2019, to regain compliance.

Subsequently, on July 23, 2019, the Company was provided an additional 180 calendar

day compliance period, or until January 20, 2020, to demonstrate compliance.

On January 21, 2020, the Company was notified of

Nasdaq’s delist determination as it had not regained compliance.

On January 28, 2020, the Company requested a hearing, which

was held on February 27, 2020.

On March 10, 2020, the Company received a letter from Nasdaq stating that the Nasdaq Hearings Panel

Panel ”) granted an exception to permit the Company to demonstrate compliance on or before May 8, 2020.

response to current volatile stock market conditions and decreases in the stock price of many companies, Nasdaq announced on April

17, 2020 that it has temporarily provided relief from certain of its continued listing requirements for common stock and other

Among other things, Nasdaq is tolling until June 30, 2020, the period for any non-compliant company to regain compliance

with the requirement to maintain a minimum closing bid price of $1 for at least 30 consecutive business days.

As a result, the

Company automatically received an extension to demonstrate its compliance with the Nasdaq Minimum Bid Price requirement on or

before July 23, 2020.

The shares of the Company continue to be listed on the Nasdaq Capital Market, subject to the condition listed

The temporary relief the Company received was based on Nasdaq Issuer Notification 2020-2, which provides additional time

to issuers to return to compliance with pricing related listing rules, including the Minimum Bid Price requirement.

July 7, 2020, the Company effected a reverse stock split of the Company’s common stock at the ratio of one-for-five.

has determined that for 11 consecutive trading days from July 7 through July 21, 2020, the closing bid price of the Company’s

common stock has been closed above $1.00 per share.

On July 22, 2020, the Panel notified the Company that it has regained compliance

with the requirement to maintain a minimum closing bid price of $1 and this matter is now closed.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”) was enacted and signed into law

and includes, among other things, refundable payroll tax credits, deferment of employer side social security payments, net operating

loss carryback periods and alternative minimum tax credit refunds.

The Company does not at present expect the provisions of the

CARES Act to have a material impact on its tax provision given the amount of net operating losses currently available.

Company’s income tax expenses for the year ended June 30, 2020 and 2019 are as follows:

For the Years Ended

Total income tax expense

tax expense for the years ended June 30, 2020 and 2019 varied from the amount computed by applying the statutory income tax rate

to income before taxes.

Reconciliations between the expected federal income tax rates using 21% for the year ended June 30, 2020

and 2019 to the Company’s effective tax rate are as follows:

US Statutory tax rate

Permanent difference*

Change in valuation allowance

Rate differential in foreign jurisdiction

difference includes non-deductible stock compensation expenses.

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

Allowance for doubtful accounts

Net operating loss

Total deferred tax assets

Valuation allowance

Deferred tax assets, net - long-term

The Company’s operations

These employment agreements provide for five-year

terms that extend automatically in the absence of termination notice provided at least 60 days prior to the anniversary date of the agreement.

If the Company fails to provide this notice or if the Company wishes to terminate an employment agreement in the absence of cause, then

the Company is obligated to provide at least 30 days’ prior notice.

In such case during the initial term of the agreement, the

Company would need to pay such executive (i) the remaining salary through the date of December 31, 2023, (ii) two times of the then applicable

annual salary if there has been no change in control, as defined in the employment agreements or three-and-half times of the then applicable

annual salary if there is a change in control.

March 27, 2020, the CARES Act was enacted and signed into law and includes, among other things, refundable payroll tax credits, deferment

of employer side social security payments, net operating loss carryback periods and alternative minimum tax credit refunds.

does not at present expect the provisions of the CARES Act to have a material impact on its tax provision given the amount of net operating

losses currently available.

Company’s income tax expenses for the years ended June 30, 2021 and 2020 are as follows:

the Years Ended

income tax expense

$ ( 186,021 )

tax expense for the years ended June 30, 2021 and 2020 varied from the amount computed by applying the statutory income tax rate to income

before taxes.

Reconciliations between the expected federal income tax rates using 21 % for the year ended June 30, 2021 and 2020 to the

Company’s effective tax rate are as follows:

Statutory tax rate

in valuation allowance

differential in foreign jurisdiction

* Permanent difference includes non-deductible expenses.

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

for doubtful accounts

operating loss

deferred tax assets

( 9,353,000 )

( 7,463,000 )

tax assets, net - long-term

Company’s operations in the U.S.

incurred a cumulative U.S.

federal NOL of approximately $3,781,000 as of June 30, 2019 which may reduce future federal

federal net operating loss (“NOL”) of approximately $ 6,456,000

as of June 30, 2020 which may reduce future federal taxable income.

During the year ended June 30, 2021, approximately $ 6,087,000 of

additional NOL was generated and the tax benefit derived from such NOL was approximately $ 1,278,000 , respectively.

As of June 30, 2021,

the Company’s cumulative NOL amounted to approximately $ 12,543,000 which may reduce future federal taxable income, of which approximately

$ 1,400,000 will expire in 2037 and the remaining balance carried forward indefinitely.

Company’s operations in China incurred a cumulative NOL of approximately $ 5,961,000 as of June 30, 2020 which may reduce future

taxable income.

During the year ended June 30, 2020, approximately $2,675,000 of additional NOL was generated and the tax benefit

derived from such NOL was approximately $562,000, respectively.

As of June 30, 2020, the Company’s cumulative NOL amounted

to approximately $6,456,000 which may reduce future federal taxable income, of which approximately $1,400,000 will expire in

2037 and the remaining balance carried forward indefinitely.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

The Company’s

operations in China incurred a cumulative NOL of approximately $5,828,000 as of June 30, 2019 which may reduce future taxable income.

During the year ended June 30, 2020, approximately $133,000 of additional NOL was generated and the tax benefit derived from such

NOL was approximately $33,000.

As of June 30, 2020, the Company’s cumulative NOL amounted to approximately $5,961,000 which

may reduce future taxable income, of which approximately $281,000 start expiring from 2021 and the remaining balance of NOL will

be expired by 2025.

The Company periodically evaluates the likelihood of the realization

of deferred tax assets, and reduces the carrying amount of the deferred tax assets by a valuation allowance to the extent it believes

a portion will not be realized.

Management considers new evidence, both positive and negative, that could affect the Company’s

future realization of deferred tax assets including its recent cumulative earnings experience, expectation of future income, the

carry forward periods available for tax reporting purposes and other relevant factors.

The Company determined that it is more likely

than not its deferred tax assets could not be realized due to uncertainty on future earnings as a result of the deterioration of

trade negotiation between US and China in 2019.

The Company provided a 100% allowance for its DTA as of June 30, 2020.

increase in valuation for the year ended June 30, 2020 amounted to approximately $3,861,000, respectively based on management’s

reassessment of the amount of the Company’s deferred tax assets that are more likely than not to be realized.

Company’s taxes payable consists of the following:

VAT tax payable

Corporate income tax payable

During the year ended June 30, 2021, approximately $ 65,000 of additional NOL was generated and the tax benefit derived

from such NOL was approximately $ 16,000 , respectively.

As of June 30, 2021, the Company’s cumulative NOL amounted to approximately

$ 6,026,000 which may reduce future taxable income, of which approximately $ 700,000 start expiring from 2023 and the remaining balance

of NOL will be expired by 2026.

Company periodically evaluates the likelihood of the realization of deferred tax assets, and reduces the carrying amount of the deferred

tax assets by a valuation allowance to the extent it believes a portion will not be realized.

Management considers new evidence, both

positive and negative, that could affect the Company’s future realization of deferred tax assets including its recent cumulative

earnings experience, expectation of future income, the carry forward periods available for tax reporting purposes and other relevant

The Company determined that it is more likely than not its deferred tax assets could not be realized due to uncertainty on future

earnings as a result of the deterioration of trade negotiation between US and China and the outbreak of COVID-19 in 2021.

provided a 100 % allowance for its DTA as of June 30, 2021.

The net increase in valuation for the year ended June 30, 2021 amounted to

approximately $ 1,890,000 based on management’s reassessment of the amount of the Company’s deferred tax assets that are more

likely than not to be realized.

Company’s taxes payable consists of the following:

income tax payable

CONCENTRATIONS

For the year ended

June 30, 2020, three customers accounted for approximately 42%, 23% and 22% of the Company’s revenues, respectively.

of June 30, 2020, one customer accounted for approximately 87% of the Company’s accounts receivable, net.

For the year ended

June 30, 2019, three customers accounted for approximately 35%, 16% and 13% of the Company’s revenues, respectively.

of June 30, 2019, all of these customers accounted for approximately 26% of the Company’s accounts receivable, net.

For the year ended June

30, 2020, three suppliers accounted for approximately 26%, 18% and 16% of the total costs of revenue, respectively.

For the year ended June

30, 2019, three suppliers accounted for approximately 23%, 12% and 10% of the total costs of revenue, respectively.

For the year ended June 30, 2021, one customer accounted

for approximately 89.7 % of the Company’s revenues.

As of June 30, 2021, one customer accounted for approximately 87.6 % of the

Company’s accounts receivable, net.

the year ended June 30, 2020, three customers accounted for approximately 42 %, 23 % and 22 % of the Company’s revenues, respectively.

As of June 30, 2020, one customer accounted for approximately 87 % of the Company’s accounts receivable, net.

the year ended June 30, 2021, two suppliers accounted for approximately 55.4 % and 28.6 % of the total costs of revenue, respectively.

the year ended June 30, 2020, three suppliers accounted for approximately 26 %, 18 % and 16 % of the total costs of revenue, respectively.

SEGMENT REPORTING

280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent

with the Company’s internal organizational structure as well as information about geographical areas, business segments

and major customers in consolidated financial statements for detailing the Company’s business segments.

Company’s chief operating decision maker is the Chief Executive Officer, who reviews the financial information of the separate

280, “Segment Reporting”, establishes standards for reporting information about operating segments on a basis consistent

with the Company’s internal organizational structure as well as information about geographical areas, business segments and major

customers in consolidated financial statements for detailing the Company’s business segments.

Company’s chief operating decision maker is the Chief Executive Officer, who reviews the financial information of the separate

operating segments when making decisions about allocating resources and assessing the performance of the group.

The Company has

determined that it has four operating segments:

The Company has determined

that it has three operating segments:

(1) shipping agency and management services;

(2) inland transportation management

(3) freight logistics services and (4) container trucking services.

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

(2) freight logistics services and (3) container trucking

following tables present summary information by segment for the years ended June 30, 2021 and 2020, respectively:

For the Year Ended June 30, 2020

Agency and Management

Transportation Management Services

Container Trucking Services

- Related party

- Third parties

$ 4,368,596 *

Total revenues

the Year Ended June 30, 2021

Cost of revenues

$ 2,795,859 *

Depreciation and amortization

1 unchanged sentence

Gross margin%

For certain freight

logistics contracts that the Company entered into with customers starting from first quarter of fiscal year 2020, the Company

(i) acts as an agent in arranging the relationship between the customer and the third-party service provider and (ii) does

not control the services rendered to the customers, revenues related to these contracts are presented net of related costs.

For the year ended June 30, 2020, gross revenues and gross cost of revenues related to these contracts amounted to approximately

$25.8 million and $24.3 million, respectively.

the Year Ended June 30, 2020

Agency Services

Transportation

Management Services

Trucking Services

- Third parties

Total revenues

Cost of revenues

Depreciation and

Total capital expenditures

Gross margin%

$ 4,368,596 *

$ 2,795,859 *

and amortization

capital expenditures

* For certain freight logistics contracts that the Company entered into with customers starting from first quarter of fiscal year 2020, the Company (i) acts as an agent in arranging the relationship between the customer and the third-party service provider and (ii) does not control the services rendered to the customers, revenues related to these contracts are presented net of related costs.

For the year ended June 30, 2020, gross revenues and gross cost of revenues related to these contracts amounted to approximately $ 25.8 million and $ 24.3 million, respectively.

There was no such transaction for the year ended June 30, 2021.

assets as of:

2 unchanged sentences

Container Trucking Services

The Company’s operations are primarily

based in the PRC, U.S, and Hong Kong, where the Company derives all of their revenues.

Management also review consolidated financial

results by business locations.

Disaggregated information of revenues by

geographic locations are as follows:

Total revenues

SHIPPING AMERICA, LTD.

AND AFFILIATES

TO THE CONSOLIDATED FINANCIAL STATEMENTS

RELATED PARTY TRANSACTIONS

of June 30, 2020 and 2019, the outstanding amounts due from a related party consist of the following:

Company’s operations are primarily based in the PRC and U.S, where the Company derives all of their revenues.

Management also review

consolidated financial results by business locations.

Disaggregated

information of revenues by geographic locations are as follows:

the Years Ended

RELATED PARTY BALANCE AND TRANSACTIONS

from related party, net

of June 30, 2021 and 2020, the outstanding amounts due from related parties consist of the following:

Tianjin Zhiyuan Investment Group Co., Ltd.

Zhejiang Jinbang Fuel Energy Co., Ltd (2)

allowance for doubtful accounts

June 2013, the Company signed a five-year global logistic service agreement with Tianjin Zhiyuan Investment Group Co., Ltd.

“Zhiyuan Investment Group”) and TEWOO Chemical & Light Industry Zhiyuan Trade Co., Ltd.

(together with Zhiyuan

Investment Group, “Zhiyuan”).

Zhiyuan Investment Group is owned by Mr.

Zhang, the largest shareholder of the Company.

In September 2013, the Company executed an inland transportation management service contract with the Zhiyuan Investment Group

whereby it would provide certain advisory services and help control potential commodities loss during the transportation process.

The amount due from Zhiyuan Investment Group as of June 30, 2020 was $484,331 and the Company provided a 10% allowance for doubtful

accounts of the amount due from Zhiyuan.

For the year ended June 30, 2020, the Company recovered $41,341 of allowance for doubtful

accounts of the amount due from Zhiyuan.

As of June 30, 2020,

the Company had payable to the CEO of $6,279 and to the Acting CFO of $26,570 which were included in other payable.

These payments

were made on behalf of the Company for the daily business operational activities.

(1) In June 2013, the Company signed a five-year

global logistic service agreement with Tianjin Zhiyuan Investment Group Co., Ltd.

(“Zhiyuan Investment Group”) and TEWOO Chemical&

Light Industry Zhiyuan Trade Co., Ltd.

(together with Zhiyuan Investment Group, “Zhiyuan”).

Zhiyuan Investment Group is owned

In September 2013, the Company executed an inland transportation management service contract with the Zhiyuan Investment

Group whereby it would provide certain advisory services and help control potential commodities loss during the transportation process.

in late 2020, Mr, Zhang started selling off his shares of the Company and does not own shares of the Company as of June 30, 2021 and

no longer a related party.

Management’s reassessed the collectability and decided to make additional $ 345,898 allowance for doubtful

accounts as of June 30, 2021.

For the years ended June 30, 2021 and 2020, the Company recovered $ 10,000 and $ 41,341 , respectively, of

allowance for doubtful accounts of the amount due from Zhiyuan.

(2) The Company advanced Zhejiang Jinbang Fuel

Energy Co., Ltd (“Zhejiang Jinbang”) $ 477,278 and Zhejiang Jinbang return $ 46,376 for the year ended June 30, 2021.

of the advance is non interest bearing and due on demand.

receivable- related parties

June 10, 2021, the Company entered a loan agreement with Wang Qinggang, CEO and legal representative of Trans Pacific Logistic Shanghai

The loan amounted to $ 619,329 (RMB 4 million) and will be repaid in June 2023.

On April 10, 2021, the Company entered into a

loan agreement with Shanghai Baoyin Industrial Co., Ltd.

which is 30 % owned by Wang Qinggang.

The loan amounted to $ 4,644,969 (RMB 30,000,000

$ 619,329 (RMB 4,000,000 ) has been repaid as of June 30, 2021 and the rest of the loan $ 4,025,640 (RMB 26,000,000 ) is to be repaid

in April 2023.

The loan is unsecured and non-interest bearing.

As of June 30, 2021, the Company had payable to

the CEO of $ 11,303 and to the acting CFO of $ 2,516 which were included in other payable.

As of June 30, 2020, the Company had payable

to the CEO of $ 6,279 and to the Acting CFO of $ 26,570 which were included in other payable.

These payments were made on behalf of the

Company for the daily business operational activities.

SUBSEQUENT EVENTS

On July 31, 2020,

the Company deregistered Longhe Ship Management (Hong Kong) Co., Limited (“LSM”) which is 100% own by Sino-Global

Shipping (HK) Ltd.

LSM has not been in operation or carried on business after June 30, 2018.

The result of operations

of LSM was immaterial for the years ended June 30, 2020 and 2019.

From July to September

2020, the Company received a total proceeds of $59,869 related to the 1,000,000 shares of the Company’s common stock issuance

Shanming Liang (see Note 12).

The full amount of subscription receivable has been paid off.

April 6, 2020, the Company entered into a share purchase agreement (the “Agreement”) with Mr.

Kelin Wu (the “Seller”)

and Mandarine Ocean Ltd, a shipping company registered in the Marshall Islands (“Hanyang Shipping”), to acquire 75%

of the capital stock of Hanyang Shipping held by the Seller for an aggregate consideration of up to $3.75 million to be paid in

cash and the Company’s restricted shares of common stock.

On June 17, 2020, the Company and Mr.

Wu entered into the First

Amended and Restated Share Purchase Agreement (the “Amendment”) to amend the purchase price to an aggregate consideration

of up to $1.5 million and the Company’s restricted shares.

September 3, 2020, the Company and Mr.

Wu signed a Termination Agreement to terminate the Amendment mutually.

Neither party will

owe the other party any termination penalty in connection with the Termination Agreement.

September 17, 2020, the Company entered into certain securities purchase agreement (the “SPA”) with certain “non-U.S.

Persons”

(the “Purchasers”) as defined in Regulation S of the Securities Act of 1933, as amended, pursuant to

which the Company agreed to sell an aggregate of 720,000 shares (the “Shares”) of the Company’s common stock,

no par value (“Common Stock”), and warrants (the “Warrants”) to purchase 720,000 Shares at a per share

purchase price of $1.46 (the “Offering”).

The net proceeds to the Company from such Offering will be approximately

$1.05 million.

The Warrants will be exercisable six (6) months following the date of issuance at an exercise price of $1.825 for

cash (the “Warrant Shares”).

The Warrants may also be exercised cashlessly if at any time after the six-month anniversary

of the issuance date, there is no effective registration statement registering, or no current prospectus available for, the resale

of the Warrant Shares.

The Warrants will expire five and a half (5.5) years from its date of issuance.

The Warrants are subject

to anti-dilution provisions to reflect stock dividends and splits or other similar transactions.

The Warrants contain a mandatory

exercise right for the Company to force exercise the Warrants if the Company’s common stock trades at or above $4.38 for

20 consecutive trading days, provided, among other things, that the shares issuable upon exercise of the are registered or may

be sold pursuant to Rule 144 and the daily trading volume exceeds 60,000 shares of Common Stock per trading day on each trading

day in a period of 20 consecutive trading days prior to the applicable date.

On September 21 and September 22, 2020, the Company

received total gross proceeds of $1.05 million.

July 2021, the company registered a new company Gorgeous Trading Ltd.

Which is 100 % owned by Sino-Global Shipping New York Inc.

company will be mainly responsible for the Company’s smart warehouse and related business in Texas.

action taken as of August 13, 2021, the Board of Directors (the “Board”) of Sino-Global Shipping America, Ltd.

(the “Company”)

and the Compensation Committee of the Board (the “Committee”) approved a one-time award of a total of 1,020,000 of the common

stock from the shares reserved under the Company’s 2014 Stock Incentive Plan (the “Plan”) to (i) Chief Executive Officer,

Lei Cao, is entitled to a one-time stock award grant of 600,000 shares, (ii) acting Chief Financial Officer, Tuo Pan, is entitled to

a one-time stock award grant of 200,000 shares, (iii) Board member, Zhikang Huang, is entitled to a one-time stock award grant of 160,000

shares, (iv) Board member, Jing Wang, is entitled to a one-time stock award grant of 20,000 shares, (v) Board member, Xiaohuan Huang,

is entitled to a one-time stock award grant of 20,000 shares, and (vi) Board member, Tieliang Liu, is entitled to a one-time stock award

grant of 20,000 shares.

Fair value of these grants at grant date was approximately $3.0 million .

On August 31, 2021, the company formed a joint venture,

Phi Electric Motor, Inc.

in New York, which is 51% owned by Sino-Global Shipping New York 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