Shengda Network Technology on September 29, 2022, during the audit for the fiscal year ended June 30, 2022, discovered that certain prior related party transactions were not properly disclosed in financial statements previously filed by the Company with the Securities and Exchange Commission. As a result, the Company's management determined that the financial statements for the following periods should no longer be relied upon and should be revised and restated: The fiscal year ended June 30, 2020, contained in the Annual Report on Form 10-K filed with the Commission on November 13, 2020; the fiscal quarter ended September 30, 2020, contained in the Form 10-Q filed with the Commission on January 11, 2021; the fiscal quarter ended December 31, 2020, contained in the Form 10-Q filed with the Commission on April 20, 2021; the fiscal quarter ended March 31, 2021, contained in the Form 10-Q filed with the Commission on August 10, 2021; the fiscal year ended June 30, 2021, contained in the Annual Report on Form 10-K filed with the Commission on September 28, 2021; the fiscal quarter ended September 30, 2021, contained in the Form 10-Q filed with the Commission on November 16, 2021; the fiscal quarter ended December 31, 2021, contained in the Form 10-Q filed with the Commission on March 9, 2021; the fiscal quarter ended March 31, 2022, contained in the Form 10-Q filed with the Commission on May 20, 2022 (collectively, the Financial Statements"). In the Financial Statements, loans made by the Company to Zhejiang Malai E-commerce Co.

Ltd. (Zhejiang Malai") over a period of time between October 28, 2020, through December 30, 2020, were previously not disclosed as related party transactions, and were recorded collectively as a loan receivable. Given the fact that Zhejiang Malai is a related party, the Financial Statements will be revised to properly record the loans as a loan receivable to a related party. Notwithstanding the prior error in recording this transaction, the amount of the loans will not change.

In addition, income generated from the Company's sales to Zhejiang Malai was previously recorded in the Financial Statements as revenue. Given the fact that Zhejiang Malai is a related party, the Financial Statements will be revised to properly record revenue generated from sales to Zhejiang Malai as revenue from a related party. Notwithstanding the prior error in recording these transactions, the total amount of the Company's revenues will not change.

The Company will file amended reports with the Commission for each of the periods indicated above as soon as practicable. The Company does not expect that the above-described revisions will affect the Company's previously reported pre-tax income (loss), net income (loss), earning per share, or total revenue as reflected in the Financial Statements.