Shineco : Amendment to Annual Report (Form 10-K/A)

February 10, 2022 at 05:03 pm EST

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-K/A

(Amendment No.1)

☒annual report pursuant to Section 13 or 15(d) of the Securities Exchange

Act of 1934

For the fiscal year ended June 30, 2021

☐Transition report pursuant to Section 13 or 15(d) of the Securities Exchange

Act of 1934

For the transition period from _________ to _________

Commission File Number: 001-37776

SHINECO, INC.

(Exact name of issuer as specified in its charter)

Delaware		52-2175898
(State or other jurisdiction of		(I.R.S. employer
incorporation or organization)		identification number)

Room 1001, Building T5, DaZu Square,
Daxing District, Beijing
People's Republic of China		100176
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code (+86)10-87227366

Securities registered pursuant to Section 12(b) of the Act:

Title of each Class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001 per share		SISI		The Nasdaq Stock Market LLC

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No☒

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Sec. 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No☒

The aggregate market value of the voting and non-voting common equity stock held by non-affiliates of the registrant was approximately $4,191,885as of December 31, 2020, the last business day of the registrant's most recently completed second fiscal quarter, based on the closing price of the registrant's common stock on such date of $3.06 per share, as reported on the Nasdaq Capital Market.

As of September 27, 2021, the registrant had 8,768,109shares of common stock outstanding.

Explanatory Note

Shineco, Inc. (the "Company") is filing this Amendment No.1 to its Annual Report on form 10-K for the fiscal year ended June 30, 2021, originally filed with the U.S. Securities and Exchange Commission (the "SEC") on September 30, 2021 (the "Original Filing") to clarify and correct certain statements and typographical errors about the Company's sale of its securities in April 2021. Only those Items that contain a revision are being included in this 10-K/A (other than with respect to the Exhibit Index).

As required by Rule 12b-15 under the Securities Exchange Act of 1934, as amended, new certificates of our principal executive officer and principal financial officer are being filed as exhibits to this Amendment No. 1 on Form 10-K/A as Exhibits 31.1, and 31.2.

Except as described in this Explanatory Note, no other changes have been made to the Original Filing. The Original Filing continues to speak as of the date of the Original Filing and we have not updated the disclosures contained therein to reflect any events which may have taken place at a date subsequent to the filing of the Original Filing. Accordingly, this Amendment No. 1 on Form 10-K/A should be read in conjunction with our filings with the SEC subsequent to the date of the Original Filing.

The following sections of this Form 10-K/A contain information that has been amended where necessary to reflect the above-referenced changes to the Original Filing:

	●	Cover page to clarify the number shares that were outstanding as of September 27, 2021.

	●	Part II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchaser of Equity Securities, Recent sale of Unregistered Securities

	●	Part II Item 7. Management's Discussion and Analysis of Financial Conditions and Results of Operation

	●	Part II Item 8. Financial Statements and Supplementary Date, Note 14 Stockholders' Equity of the Notes to the Financial Statements

TABLE OF CONTENTS

TO ANNUAL REPORT ON FORM 10-K/A

FOR YEAR ENDED JUNE 30, 2021

Part II
Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchase of Equity Securities	4
Item 7.	Management's Discussion and Analysis of Financial Conditions and Results of Operations	5
Item 8.	Financial Statements and Supplementary Data	17

Part IV
Item 15.	Exhibits and Financial Statement Schedules	18

All references to "we," "us," "our," "TYHT," "Company," "registrant" or similar terms used in this report refer to Shineco, Inc., a Delaware corporation ("TYHT"), including its consolidated subsidiaries and variable interest entities ("VIEs"), unless the context otherwise indicates. In the context of describing our business, "we," "us," "our," "TYHT," "Company," or "registrant" refers to our VIEs and their subsidiaries, unless the context otherwise indicates.

Our reporting currency is the US$. The functional currency of our entities located in China is the RMB. For the entities whose functional currency is the RMB, results of operations and cash flows are translated at average exchange rates during the period, assets and liabilities are translated at the unified exchange rate at the end of the period, and equity is translated at historical exchange rates. As a result, amounts relating to assets and liabilities reported on the statements of cash flows may not necessarily agree with the changes in the corresponding balances on the balance sheets. Translation adjustments resulting from the process of translating the local currency financial statements into US$ are included in determining comprehensive income/loss. Transactions denominated in foreign currencies are translated into the functional currency at the exchange rates prevailing on the transaction dates. Assets and liabilities denominated in foreign currencies are translated into the functional currencies at the exchange rates prevailing at the balance sheet date with any transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in a currency other than the functional currency are included in the results of operations as incurred.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This annual report on Form 10-K (the "Report") and other reports (collectively the "Filings") filed by the registrant from time to time with the Securities and Exchange Commission (the "SEC") contain or may contain forward looking statements and information that are based upon beliefs of, and information currently available to, the registrant's management as well as estimates and assumptions made by the registrant's management. When used in the filings the words "anticipate," "believe," "estimate," "expect," "future," "intend," "plan" or the negative of these terms and similar expressions as they relate to the registrant or the registrant's management identify forward looking statements. Such statements reflect the current view of the registrant with respect to future events and are subject to risks, uncertainties, assumptions and other factors (including the risks contained in the section of this Report entitled "Risk Factors") relating to the registrant's industry, the registrant's operations and results of operations and any businesses that may be acquired by the registrant. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended or planned.

Although the registrant believes that the expectations reflected in the forward-looking statements are reasonable, the registrant cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, the registrant does not intend to update any of the forward-looking statements to conform these statements to actual results. The following discussion should be read in conjunction with the registrant's financial statements and the related notes thereto included in this Report.

Part II

Item 5.

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchase of Equity Securities

Market Information

On September 27, 2016, we completed an initial public offering of 1,713,190 shares of common stock at a $4.50 offering price. Our common stock started trading on the NASDAQ Capital Market under the symbol of TYHT on September 28, 2016. Based on the records of our transfer agent, we had 8,768,109 shares of common stock issued and outstanding as of September 27, 2021

Holders

As of September 27, 2021 there were 180 registered holders of record of our common stock.

Dividends

We anticipate that we will retain any earnings to support operations and to finance the growth and development of our business. Therefore, we do not expect to pay cash dividends in the foreseeable future. Any future determination relating to our dividend policy will be made at the discretion of our Board of Directors and will depend on a number of factors, including future earnings, capital requirements, financial conditions and future prospects and other factors the Board of Directors may deem relevant. Furthermore, our ability to pay dividends is limited by the Delaware General Corporation Law, which provides that a corporation may only pay dividends out of existing "surplus," which is defined as the amount by which a corporation's net assets exceeds its stated capital.

During the current fiscal year and the two most recent completed fiscal years, we did not declare or pay any cash dividends on our shares of common stock, and we do not expect to pay cash dividends in the foreseeable future. If we determine to pay dividends on any of our common stock in the future, as a holding company, we will be dependent principally on receipt of funds from our operating subsidiaries. Current PRC regulations permit our PRC subsidiaries to pay dividends to Shineco only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. In addition, each of our subsidiaries in China is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital. Each of such entity in China is also required to further set aside a portion of its after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion of its board of directors. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation.

In addition, pursuant to the EIT Law and its implementation rules, dividends generated after January 1, 2008 and distributed to us by our PRC subsidiaries are subject to withholding tax at a rate of 10% unless otherwise exempted or reduced according to treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC-resident enterprises are incorporated.

Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of SAFE, by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated from the operations in China may be used to pay dividends to our company.

Registrar and Stock Transfer Agent

Our transfer agent is TranShare Cooperation, with an office address at Bayside Center 1, 17755 North US Highway 19, Suite # 140, Clearwater FL 33764. Its telephone number is (303) 662-1112.

Penny Stock Regulations

Our shares of common stock are subject to the "penny stock" rules of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and various rules thereunder. In general terms, "penny stock" is defined as any equity security that has a market price less than $5.00 per share, subject to certain exceptions. The rules provide that any equity security is considered to be a penny stock unless that security is registered and traded on a national securities exchange meeting specified criteria set by the SEC, issued by a registered investment company, and excluded from the definition on the basis of price (at least $5.00 per share), or based on the issuer's net tangible assets or revenues. In the last case, the issuer's net tangible assets must exceed $3,000,000 if in continuous operation for at least three years or $5,000,000 if in operation for less than three years or the issuer's average revenues for each of the past three years must exceed $6,000,000.

Trading in shares of penny stock is subject to additional sales practice requirements for broker-dealers who sell penny stocks to persons other than established customers and accredited investors. Accredited investors, in general, include individuals with assets in excess of $1,000,000 or annual income exceeding $200,000 (or $300,000 together with their spouse), and certain institutional investors. For transactions covered by these rules, broker-dealers must make a special suitability determination for the purchase of the security and must have received the purchaser's written consent to the transaction prior to the purchase. Additionally, for any transaction involving a penny stock, the rules require the delivery, prior to the first transaction, of a risk disclosure document relating to the penny stock. A broker-dealer also must disclose the commissions payable to both the broker-dealer and the registered representative, and current quotations for the security. Finally, monthly statements must be sent disclosing recent price information for the penny stocks. These rules may restrict the ability of broker-dealers to trade or maintain a market in our common stock, to the extent it is penny stock, and may affect the ability of shareholders to sell their shares.

Securities Authorized for Issuance under Equity Compensation Plans

During the fiscal year ended June 30, 2021, the Company has not adopted any incentive plan.

Recent Sales of Unregistered Securities

On January 27, 2021, the Company issued 364,445 shares of common stock to three investors at a price of US$3.0 per share. The Company received net proceeds of US$1,093,355.

On April 14, 2021, the Company entered into certain stock purchase agreements (the "SPAs") with certain investors (the "Purchasers"), pursuant to which the Company agreed to sell, and the Purchasers agreed to purchase, severally and not jointly, an aggregate of 3,872,194 shares of common stock of the Company (the "Shares") in an aggregate amount of $11,005,204 (the "Offering"). The closing for the sale of the Shares in the Offering was subject to certain closing conditions. As of June 30, 2021, the Company had received gross proceeds of $2,470,001 from the sale of the Shares in the Offering and had not yet received the remaining balance of $8,535,203 in connection with the Offering.

On June 16, 2021, the Company entered into a securities purchase agreement pursuant to which the Company issued an unsecured convertible promissory note with a one-year maturity to an institutional accredited investor, Streeterville Capital, LLC ("Investor"). The note has the original principal amount of US$3,170,000 and Investor gave consideration of US$3.0 million, reflecting original issue discount of US$150,000 and Investor's legal fee of US$20,000. Interest accrues on the outstanding balance of the note at 6% per annum. The Company anticipates using the proceeds for general working capital purposes. The Company received principal in full from the Investor.

On August 19, 2021, the Company entered into another securities purchase agreement pursuant to which the Company issued an unsecured convertible promissory note with a one-year maturity to the same Investor. The note has the original principal amount of US$10,520,000.00 and Investor gave consideration of US$10 million, reflecting original issue discount of US$500,000 and Investor's legal fee of US$20,000. Interest accrues on the outstanding balance of the note at 6% per annum. The Company anticipates using the proceeds for general working capital purposes.

The above-mentioned issuances of securities of the Company deemed to be exempt under the Securities Act by virtue of Section 4(2) thereof as transactions not involving any public offering. In addition, certain issuances were deemed not to fall within Section 5 under the Securities Act and to be further exempt under Rule 901 and 903 of Regulation S promulgated thereunder by virtue of being issuances of securities by non-U.S. companies to non-U.S. citizens or residents, conducted outside the United States and not using any element of interstate commerce.

Repurchase of Equity Securities

Not Applicable.

ITEM 7.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS

Forward-Looking Statements

This Annual Report on Form 10-K contains "forward-looking statements." All statements other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws. Forward-looking statements involve risks and uncertainties, such as statements about our plans, objectives, expectations, assumptions or future events. In some cases, you can identify forward-looking statements by terminology such as "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "believe," "intend," "may," "should," "will," "could," and similar expressions denoting uncertainty or an action that may, will or is expected to occur in the future. These statements involve estimates, assumptions, known and unknown risks, uncertainties, and other factors that could cause actual results to differ materially from any future results, performances or achievements expressed or implied by the forward-looking statements.

Examples of forward-looking statements include:

	●	the timing of the development of future products;

	●	projections of revenue, earnings, capital structure, and other financial items;

	●	local, regional, national, and global Luobuma and herbal medicines price fluctuations;

	●	statements of our plans and objectives, including those that relate to our proposed expansions and the effect such expansions may have on our revenue;

	●	statements regarding the capabilities of our business operations;

	●	statements of expected future economic performance;

	●	the impact of the COVID-19 outbreak;

	●	statements regarding competition in our market; and

	●	assumptions underlying statements regarding us or our business.

The ultimate correctness of these forward-looking statements depends upon a number of known and unknown risks and events. Many factors could cause our actual results to differ materially from those expressed or implied in our forward-looking statements. Consequently, you should not place undue reliance on these forward-looking statements.

The forward-looking statements speak only as of the date on which they are made, and, except as required by law, we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Nonetheless, we reserve the right to make such updates from time to time by press release, periodic report, or other method of public disclosure without the need for specific reference to this Annual Report. No such update shall be deemed to indicate that other statements not addressed by such update is incorrect or create an obligation to provide any other updates.

The information included in this Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our consolidated financial statements and the notes included in this Annual Report. All monetary figures are presented in U.S. dollars, unless otherwise indicated.

General Overview

We are a holding company incorporated in Delaware. As a holding company with no material operations of our own, we conduct a substantial majority of our operations through our operating entities established in the People's Republic of China, or the PRC, primarily our variable interest entities (the "VIEs"). We do not have any equity ownership of our VIEs, instead we control and receive the economic benefits of our VIEs' business operations through certain contractual arrangements. Our common stock that currently listed on the Nasdaq Capital Markets are shares of our Delaware holding company that maintains service agreements with the associated operating companies. The Chinese regulatory authorities could disallow our structure, which could result in a material change in our operations and the value of our securities could decline or become worthless.

We use our subsidiaries' and VIEs' vertically and horizontally integrated production, distribution, and sales channels to provide health and well-being focused plant-based products. Our products are only sold domestically in China. We utilize modern engineering technologies and biotechnologies to produce, among other products, Chinese herbal medicines, organic agricultural produce, and specialized textiles. Our health and well-being focused plant-based products business is divided into three major segments:

Processing and distributing traditional Chinese herbal medicine products as well as other pharmaceutical products - This segment is conducted through our VIE, Ankang Longevity Pharmaceutical (Group) Co., Ltd. ("Ankang Longevity Group"), which operates 66 cooperative retail pharmacies throughout Ankang, a city in southern Shaanxi province, China, through which we sell directly to individual customers traditional Chinese medicinal products produced by us as well as by third parties. Ankang Longevity Group also owns a factory specializing in decoction, which is the process by which solid materials are heated or boiled in order to extract liquids, and distributes decoction products to wholesalers and pharmaceutical companies around China.

On August 16, 2021, Tenet-Jove, completed the previously announced acquisition pursuant to the Restructuring Agreement dated June 8, 2021. Pursuant to the terms of the Restructuring Agreement, (i) the Company transferred all of its rights and interests in Ankang Longevity to Yushe County Guangyuan Forest Development Co., Ltd. ("Guangyuan")'s Shareholders in exchange for the control of 100% of equity interests in Guangyuan, which composes of one group of similar identifiable assets; (ii) Tenet-Jove entered a Termination Agreement with Ankang Longevity and the Ankang Shareholders; (iii) as a consideration to the Restructuring Agreement and based on a valuation report on the equity interests of Guangyuan issued by an independent third party, Tenet-Jove relinquished all of its rights and interests in Ankang Longevity and transferred those rights and interests to the Guangyuan Shareholders; and (iv) Guangyuan and the Guangyuan Shareholders entered into a series of variable interest entity agreements with Tenet-Jove. The assets and liabilities of the entities of Ankang Longevity Group have been reclassified as "assets of discontinued operations" and "liabilities of discontinued operations" within current and non-current assets and liabilities, respectively, on the consolidated balance sheets as of June 30, 2021 and 2020. The results of operations of Ankang Longevity have been reclassified to "net income (loss) from discontinued operations" in the consolidated statements of loss and comprehensive loss for the years ended June 30, 2021 and 2020.

Processing and distributing green and organic agricultural produce as well as growing and cultivating yew trees (taxus media) - We currently cultivate and sell yew mainly to group and corporate customers, but do not currently process yew into Chinese or Western medicines. This segment is conducted through our VIEs: Shineco Zhisheng (Beijing) Bio-Technology Co. ("Zhisheng Bio-Tech"), Yantai Zhisheng International Freight Forwarding Co., Ltd ("Zhisheng Freight"), Yantai Zhisheng International Trade Co., Ltd ("Zhisheng Trade"), and Qingdao Zhihesheng Agricultural Produce Services, Ltd ("Qingdao Zhihesheng") (collectively, the "Zhisheng VIEs").

Developing and distributing specialized fabrics, textiles, and other byproducts derived from an indigenous Chinese plant Apocynum Venetum, grown in the Xinjiang region of China, and known in Chinese as "Luobuma" or "bluish dogbane" - Our Luobuma products are specialized textile and health supplement products designed to incorporate traditional Eastern medicines with modern scientific methods. These products are predicated on centuries-old traditions of Eastern herbal remedies derived from the Luobuma raw material. This segment is channeled through our directly-owned subsidiary, Beijing Tenet-Jove Technological Development Co., Ltd. ("Tenet-Jove"), and its 90% subsidiary Tianjin Tenet Huatai Technological Development Co., Ltd. ("Tenet Huatai").

Financing Activities

On September 5, 2019, the Company entered into a securities purchase agreement with select investors whereby the Company agreed to sell, and the investors agreed to purchase, up to 310,977 shares of common stock (the "Shares") at a purchase price of US$ 4.68 per Share. The Company received net proceeds of US$ 1,500,203. The offering was being made pursuant to the Company's effective registration statement on Form S-3 (Registration Statement No. 333-221711) previously filed with the Securities and Exchange Commission and a prospectus supplement thereunder.

On December 10, 2020, the Company entered into a securities purchase agreement with select investors whereby the Company agreed to sell, and the investors agreed to purchase, up to 604,900 shares of common stock (the "Shares") at a purchase price of US$ 2.73 per Share. The Company received net proceeds of US$ 1,643,087. The offering was made pursuant to the Company's effective registration statement on Form S-3 (Registration Statement No. 333-221711) previously filed with the Securities and Exchange Commission and a prospectus supplement thereunder.

On January 27, 2021, the Company issued 364,445 shares of common stock to three investors at a price of US$3.0 per share. The Company received net proceeds of US$1,093,355.

On July 16, 2021, the Company entered into another securities purchase agreement pursuant to which the Company issued two unsecured convertible promissory notes with a one-year maturity to the same Investor. The first convertible promissory note has the original principal amount of US$3,170,000 and the Investor gave consideration of US$3.0 million, reflecting original issue discount of US$150,000 and Investor's legal fee of US$20,000. The second convertible promissory note has the original principal amount of US$4,200,000 and Investor gave consideration of US$4.0 million, reflecting original issue discount of US$200,000. Interest accrues on the outstanding balance of the Notes at 6% per annum. The Company received principal in full from the Investor.

On August 19, 2021, the Company entered into another securities purchase agreement pursuant to which the Company issued an unsecured convertible promissory note with a one-year maturity to the same Investor. The note has the original principal amount of US$10,520,000 and Investor gave consideration of US$10.0 million, reflecting original issue discount of US$500,000 and Investor's legal fee of US$20,000. Interest accrues on the outstanding balance of the note at 6% per annum. The Company received principal in full from the Investor. The Company anticipates using the proceeds for general working capital purposes.

Factors Affecting Financial Performance

We believe that the following factors will affect our financial performance:

Increasing demand for our products - The increasing demand for our agricultural products will have a positive impact on our financial position. We plan to develop new products and expand our distribution network as well as to grow our business through possible mergers and acquisitions of similar or synergetic businesses, all aimed at increasing awareness of our brand, developing customer loyalty, meeting customer demands in various markets and providing solid foundations for our continuous growth. As of the date of this Annual Report, however, we do not have any agreements, undertakings or understandings to acquire any such entities and there can be no guarantee that we ever will.

Maintaining effective control of our costs and expenses - Successful cost control depends upon our ability to obtain and maintain adequate material supplies as required by our operations at competitive prices. We will focus on improving our long-term cost control strategies including establishing long-term alliances with certain suppliers to ensure adequate supply is maintained. We will carry forward the economies of scale and advantages from our nationwide distribution network and diversified offerings. Moreover, we will step up our efforts in higher value-added products of Luobuma by using an exclusive and patented technology, to optimize quality management, procurement processes and cost control, and give full play to the strong production capacity and trustworthy sales teams to maximize our profit and bring better long-term return for our stockholders.

Economic and Political Risks

Our operations are conducted primarily in the PRC and subject to special considerations and significant risks not typically associated with companies in North America and Western Europe. These include risks with, among others, the political, economic and legal environment and foreign currency exchange. Our results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversions, remittances abroad, and rates and methods of taxation, among other things.

COVID-19 Impact

The COVID-19 outbreak has resulted in the implementation of significant governmental measures, including lockdowns, closures, quarantines, and travel bans, intended to control the spread of the virus. In accordance with the epidemic control measures imposed by the local governments related to COVID-19, our offices and retail stores remained closed or had limited business operations after the Chinese New Year holiday until early April 2020. In addition, COVID-19 had caused severe disruptions in transportation, limited access to our facilities and limited support from workforce employed in our operations, and as a result, we experienced delays or the inability to delivery our products to customers on a timely basis. Further, some of our customers or suppliers experienced financial distress, delayed or defaults on payment, sharp diminishing of business, or suffer disruptions in their business due to the outbreak. Any decreased collectability of accounts receivable, delayed raw materials supply, bankruptcy of small and medium businesses, or early termination of agreements due to deterioration in economic conditions could negatively impact our results of operations. Wider-spread COVID-19 in China and globally could prolong the deterioration in economic conditions and could cause decreases in or delays in spending and reduce and/or negatively impact our short-term ability to grow our revenue.

Although we have taken all possible measures to overcome the adverse impact by the COVID-19 outbreak and have resumed our normal business activities in early May 2020. Our management believes the outbreak had a negative impact on our operation result during the year ended June 30, 2021. Our revenue from continuing operations for the year ended June 30, 2021 was approximately US$ 3.0 million, a decrease of approximately US$ 7.4 million, or 71.0%, from approximately US$ 10.4 million for the same period in 2020. As of the date of this Annual Report, the COVID-19 outbreak in China appears to have been under relative control. While we expect this matter to negatively impact our business, results of operations, and financial position, the related financial impact and the duration of the impact cannot be reasonably estimated at this time.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with U.S. generally accepted accounting principles ("U.S. GAAP") requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements as well as the reported amounts of revenue and expenses during the reporting period. Critical accounting policies are those accounting policies that may be material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change, and that have a material impact on financial condition or operating performance. While we base our estimates and judgments on our experience and on various other factors that we believe to be reasonable under the circumstances, actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies used in the preparation of our consolidated financial statements require significant judgments and estimates. For additional information relating to these and other accounting policies, see Note 2 to our consolidated financial statements included elsewhere in this Report.

Consolidation of Variable Interest Entities

VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders lack adequate decision-making ability. All VIEs and their subsidiaries with which the Company is involved must be evaluated to determine the primary beneficiary of the risks and rewards of the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes.

Use of Estimates

Significant estimates required to be made by management include, but are not limited to, useful lives of property, plant, and equipment, and intangible assets, the recoverability of long-lived assets and the valuation of accounts receivable, deferred taxes and inventory reserves. Actual results could differ from those estimates.

Accounts Receivable, Net

Accounts receivable are recorded at net realizable value consisting of the carrying amount less an allowance for uncollectible accounts, as necessary. We review the accounts receivable on a periodic basis and makes general and specific allowances when there is doubt as to the collectability of individual balances. In evaluating the collectability of individual receivable balances, we consider many factors, including the age of the balance, the customers' historical payment history, their current credit-worthiness and current economic trends. The fair value of long-term receivables is determined using a present value technique by discounting the future expected contractual cash flows using current rates at which similar instruments would be issued at the measurement date. As of June 30, 2021 and 2020, the allowance for doubtful accounts from the continuing operations was US$9,805,402 and US$3,698,036, respectively. As of June 30, 2021 and 2020, the allowance for doubtful accounts from the discontinued operations was US$3,675,619 and US$1,537,400, respectively. Accounts are written off against the allowance after efforts at collection prove unsuccessful.

Inventories, Net

Inventories, which are stated at the lower of cost or net realizable value, consist of raw materials, work-in-progress, and finished goods related to our products. Cost is determined using the first in first out method. Agricultural products that we farm are recorded at cost, which includes direct costs such as seed selection, fertilizer, labor cost, and contract fees that are spent in growing agricultural products on the leased farmland, and indirect costs such as amortization of prepayments of farmland leases and farmland development costs. All the costs are accumulated until the time of harvest and then allocated to the harvested crops costs when they are sold. We periodically evaluate our inventory and records an inventory reserve for certain inventories that may not be saleable or whose cost exceeds net realizable value. As of June 30, 2021 and 2020, the inventory reserve from the continuing operations was US$1,349,288 and US$1,121,408, respectively. As of June 30, 2021 and 2020, the inventory reserve from the discontinued operations were both US$ nil.

Revenue Recognition

We previously recognized revenue from sales of Luobuma products, Chinese medicinal herbal products, and agricultural products, as well as providing logistic services and other processing services to external customers. We recognized revenue when all of the following have occurred: (i) there was persuasive evidence of an arrangement with a customer; (ii) delivery had occurred or services had been rendered; (iii) the sales price was fixed or determinable; and (iv) our collection of such fees was reasonably assured. These criteria, as related to our revenue, were considered to have been met as follows:

Sales of products: We recognized revenue from the sale of products when the goods were delivered and title to the goods passed to the customer provided that there were no uncertainties regarding customer acceptance; persuasive evidence of an arrangement existed; the sales price was fixed or determinable; and collectability was deemed probable.

Revenue from provision of services: Revenue from international freight forwarding, domestic air, and overland freight forwarding services was recognized upon the performance of services as stipulated in the underlying contract or when commodities were being released from the customer's warehouse; the service price was fixed or determinable; and collectability was deemed probable.

With the adoption of ASC 606, "Revenue from Contracts with Customers," revenue is recognized when all of the following five steps are met: (i) identify the contract(s) with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations; (v) recognize revenue when (or as) each performance obligation is satisfied. We adopted the new revenue standard beginning July 1, 2018, and adopted a modified retrospective approach upon adoption. We believe that our previous revenue recognition policies are generally consistent with the new revenue recognition standards set forth in ASC 606. Potential adjustments to input measures are not expected to be pervasive to the majority of our contracts. There is no significant impact upon adoption of the new guidance.

Fair Value of Financial Instruments

We follow the provisions of ASC 820, "Fair Value Measurements and Disclosures." ASC 820 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:

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2 applies to assets or liabilities for which there are inputs, other than quoted prices in level, that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the asset or liability.

The carrying value of financial instruments included in current assets and liabilities approximate their fair values because of the short-term nature of these instruments.

Results of Operations for the Years Ended June 30, 2021 and 2020

Overview

The following table summarizes our results of operations for the years ended June 30, 2021 and 2020:

	Years Ended June 30,			Variance
	2021			2020			Amount		%
Revenue	$	3,021,704			$	10,418,576		$	(7,396,872	)	(71.00	)%
Cost of revenue		7,257,855				7,523,019			(265,164	)	(3.52	)%
Gross profit (loss)		(4,236,151	)			2,895,557			(7,131,708	)	(246.30	)%
General and administrative expenses		17,131,400				7,686,715			9,444,685		122.87	%
Selling expenses		45,384				297,199			(251,815	)	(84.73	)%
Loss from operations		(21,412,935	)			(5,088,357	)		(16,324,578	)	320.82	%
Impairment loss on an unconsolidated entity		-				(2,062,035	)		2,062,035		(100.00	)%
Other income (expense), net		(55,746	)			38,868			(94,614	)	(243.42	)%
Interest income, net		29,236				77,523			(48,287	)	(62.29	)%
Loss before income tax provision from continuing operations		(21,439,445	)			(7,034,001	)		(14,405,444	)	204.80	%
Provision for income taxes		-				244,476			(244,476	)	(100.00	)%
Net loss from continuing operations		(21,439,445	)			(7,278,477	)		(14,160,968	)	194.56	%
Net income (loss) from discontinued operations		(10,616,988	)			767,936			(11,384,924	)	(1,482.54	)%
Net loss	$	(32,056,433	)		$	(6,510,541	)	$	(25,545,892	)	392.38	%
Comprehensive loss attributable to Shineco Inc.	$	(25,893,417	)		$	(8,728,483	)	$	(17,164,934	)	196.65	%

Revenue

Currently, we have two revenue streams derived from our two major business segments from continuing operations. First, developing, manufacturing, and distributing specialized fabrics, textiles, and other by-products derived from an indigenous Chinese plant Apocynum Venetum, known in Chinese as "Luobuma" or "Bluish Dogbane," as well as Luoboma raw materials processing; this segment is channeled through our wholly owned subsidiary, Tenet-Jove. Second, planting, processing and distributing green and organic agricultural produce as well as growing and cultivation of yew trees; this segment is conducted through the Zhisheng VIEs. For the business segment, that processing and distributing traditional Chinese medicinal herbal products as well as other pharmaceutical products; this segment is conducted via our VIE, Ankang Longevity Group and its subsidiaries, which we have reclassified it as discontinued operations.

The following table sets forth the breakdown of our revenue for each of our two segments from the continuing operations, for the years ended June 30, 2021 and 2020, respectively:

	Years Ended June 30,		Variance
	2021		%		2020		%	Amount			%
Luobuma products	$	115,590		3.83	%	$	168,241		1.61	%		$	(52,651	)	(31.29	)%
Other agricultural products		2,906,114		96.17	%		10,250,335		98.39	%			(7,344,221	)	(71.65	)%
Total Amount	$	3,021,704		100.00	%	$	10,418,576		100.00	%		$	(7,396,872	)	(71.00	)%

For the years ended June 30, 2021 and 2020, revenue from sales of Luobuma products was US$ 115,590 and US$ 168,241, respectively, which represented a decrease of US$ 52,651, or 31.29%. The decrease of revenue from this segment was mainly due to the decrease in revenue from Tenet-Jove and Tenet Huatai. We did not launch any new products since last year and mainly focused on clearing off our remaining old stocks. Meanwhile, we reduced our resources and investments in our E-commerce distribution channel, which also resulted in a decrease in our online sales volume. As a result, our overall sales decreased during the year ended June 30, 2021 as compared to the same period in 2020.

For the years ended June 30, 2021 and 2020, revenue from sales of other agricultural products was US$ 2,906,114 and US$ 10,250,335, respectively, representing a decrease of US$ 7,344,221, or 71.65%. The decrease was mainly due to the decline of sales volume of yew trees during the year ended June 30, 2021 as compared to the same period in 2020. Our sales of yew trees were affected by the COVID-19 outbreak, which resulted in less orders from our customers during the year ended June 30, 2021 as compared to the same period in 2020. The decrease was also due to a shift in our business strategy as our yew trees business is adversely affected by the COVID-19. Instead of selling more unmatured yew trees, we are now cultivating more matured yew trees, which can be used to extract Taxol, a more valuable chemical substance which is used experimentally as a drug in the treatment of cancer.

Cost of Revenue and Related Tax

The following table sets forth the breakdown of the cost of revenue for each of our two segments from the continuing operations, for the years ended June 30, 2021 and 2020:

	Years Ended June 30,		Variance
	2021		%		2020		%	Amount			%
Luobuma products	$	200,247		2.76	%	$	245,291		3.26	%		$	(45,044	)	(18.36	)%
Other agricultural products		7,051,935		97.16	%		7,269,315		96.63	%			(217,380	)	(2.99	)%
Business and sales related tax		5,673		0.08	%		8,413		0.11	%			(2,740	)	(32.57	)%
Total Amount	$	7,257,855		100.00	%	$	7,523,019		100.00	%		$	(265,164	)	(3.52	)%

For the years ended June 30, 2021 and 2020, cost of revenue from sales of our Luobuma products was US$ 200,247 and US$ 245,291, respectively, representing a decrease of US$ 45,044, or 18.36%. The decrease was mainly due to the decrease in cost of revenue as we sold less Luobuma products, which was in line with the decrease in sales. However, the percentage of decrease in cost of revenue was less than the percentage of the decrease in sales, it was mainly due to reduced selling prices of our Luobuma products, as we gave more promotion and price discounts in order to attract more customers and clear our remaining old stocks during the year ended June 30, 2021.

For the years ended June 30, 2021 and 2020, cost of revenue from sales of other agricultural products was US$ 7,051,935 and US$ 7,269,315, respectively, representing a decrease of US$ 217,380, or 2.99%. The decrease was mainly due to less yew trees we sold during the year ended June 30, 2021 as compared to the same period in 2020 as mentioned above. The decrease was partially offset by a stock written off during the year ended June 30, 2021. Due to the continuous impact of Covid-19 in China and severe cold weather during the winter period this year, which resulted in the damage and death of a large number of yew trees, we wrote off our inventory amounted to US$ 3,942,784 during the year ended June 30, 2021.

Gross Profit (Loss)

The following table sets forth the breakdown of the gross profit (loss) for each of our two segments from the continuing operations, for the years ended June 30, 2021 and 2020:

	Years Ended June 30,			Variance
	2021			%		2020		%		Amount			%
Luobuma products	$	(84,673	)		2.00	%	$	(77,409	)		(2.67	)%		$	(7,264	)	9.38	%
Other agricultural products		(4,151,478	)		98.00	%		2,972,966			102.67	%			(7,124,444	)	(239.64	)%
Total Amount	$	(4,236,151	)		100.00	%	$	2,895,557			100.00	%		$	(7,131,708	)	(246.30	)%

Gross loss from Luobuma product sales increased slightly by US$ 7,264, or 9.38%, for the year ended June 30, 2021 as compared to the same period in 2020. During the year ended June 30, 2021, our gross loss was US$ 84,673, mainly due to the allowance we accrued for our slow-moving inventories amounting to US$ 118,598. However, our gross loss increased, which was mainly due to reduced selling prices of our Luobuma products, as we gave more promotion and price discounts in order to attract more customers and clear our remaining old stocks during the year ended June 30, 2021.

Gross profit from sales of other agricultural products decreased by US$ 7,124,444, or 239.64%, for the year ended June 30, 2021 as compared to the same period in 2020. During the year ended June 30, 2021, our gross loss was US$ 4,151,478, mainly due to less yew trees sold as well as a stock written off during the year ended June 30, 2021 as mentioned above. The decrease was also due to reduced selling prices of our products, as we gave more price discounts in order to get more customer orders when the demand for our products was impacted during the year ended June 30, 2021.

Expenses

The following table sets forth the breakdown of our operating expenses for the years ended June 30, 2021 and 2020, respectively:

	Years Ended June 30,		Variance
	2021		%		2020		%	Amount			%
General and administrative expenses	$	17,131,400		99.74	%	$	7,686,715		96.28	%		$	9,444,685		122.87	%
Selling expenses		45,384		0.26	%		297,199		3.72	%			(251,815	)	(84.73	)%
Total Amount	$	17,176,784		100.00	%	$	7,983,914		100.00	%		$	9,192,870		115.14	%

General and Administrative Expenses

For the year ended June 30, 2021, our general and administrative expenses were US$ 17,131,400, representing an increase of US$ 9,444,685, or 122.87%, as compared to the same period in 2020. The increase was mainly due to an increase in bad debt expenses of US$ 9,600,715 during the year ended June 30, 2021. Due to the COVID-19 outbreak in China, many of our customers' businesses were adversely affected during this period, which resulted in slow collection of our receivables, and we recorded allowance according to our accounting policy based on our best estimates. Management will continue putting effort in collection of overdue accounts receivable from our customers. Meanwhile, the increase was also due to the increase in professional services fees in relation to the issuance of common stocks, convertible notes as well as the process of discontinuing the operations of Ankang Longevity Group. The increase was partially offset by a decrease in staff salary expenses as we issued restricted shares to the management as compensation of US$ 1,022,661 during the same period in 2020.

Selling Expenses

For the year ended June 30, 2021, our selling and distribution expenses were US$ 45,384, representing a decrease of US$ 251,815, or 84.73%, as compared to the same period in 2020. The decrease was mainly due to the decrease in promotion expenses and commission expenses for our online shops of Tenet-Jove, which was in line with the decrease in our sales during the year ended June 30, 2021. The decrease was also due to the decrease in salary related expenses as a result of reduced number of staff members during the year ended June 30, 2021.

Impairment loss on an unconsolidated entity

For the years ended June 30, 2021 and 2020, our impairment loss on an unconsolidated entity was US$ nil and US$ 2,062,035. During the year ended June 30, 2020, the management performed evaluation on the impairment of the investment make to Tiancang Systematic Warehousing project operated by Zhen'Ai Network, and considered it's unlikely to obtain any investment income in the future, hence, the management fully recorded impairment loss on this investment.

Other Income (Expenses), Net

For the year ended June 30, 2021, our net other expenses were US$ 55,746, representing an increase of US$ 94,614, or 243.42%, as compared to net other income of US$ 38,868 in the same period in 2020. The increase in net other expenses was primarily due to increased loss from disposal of property and equipment during the year ended June 30, 2021 as compared to the same period in 2020.

Interest income, net

For the year ended June 30, 2021, our net interest income was US$ 29,236, representing a decrease of US$ 48,287, or 62.29%, as compared to net interest income of US$ 77,523 in the same period in 2020. The decrease in interest income was primarily attributable to the decreased average amount of cash deposits we maintained during the year ended June 30, 2021.

Provision for Income Taxes

For the years ended June 30, 2021 and 2020, our provision for income taxes decreased by US$ 244,476, or 100.00%, to US$ nil for the year ended June 30, 2021 from US$ 244,476 for the year ended June 30, 2020. The decrease in provision for income taxes was mainly due to the decreased deferred income tax provision for the year ended June 30, 2021.

Net loss from continuing operations

Our net loss from continuing operations was US$ 21,439,445 for year ended June 30, 2021, an increase of US$ 14,160,968, or 194.56%, from net loss from continuing operations of US$ 7,278,477 for year ended June 30, 2020. The increase in net loss was primarily a result of the decrease in gross profit, the increase in general and administrative expenses, partially offset by the decrease in impairment loss on an unconsolidated entity.

Net loss from discontinued operations

We discontinued the Chinese medicinal herbal products segment during the year ended June 30, 2021 due to strategy shifting. We had a net loss from discontinued operations of US$ 10,616,988 for the year ended June 30, 2021 as compared to a net income from discontinued operations of US$ 767,936 for the same period in 2020.

The summarized operating results of our discontinued operations included in our consolidated statement of loss and comprehensive loss is as follows:

	For the Years Ended June 30,
	2021			2020
Revenues	$	8,085,527			$	13,266,050
Cost of revenues		7,099,353				10,041,795
Gross profit		986,174				3,224,255
Operating expenses		5,530,993				1,625,510
Other income (expenses), net		(6,028,468	)			15,111
Income before income tax		(10,573,287	)			1,613,856
Provision for income tax expense		43,701				845,920
Net income from discontinued operations		(10,616,988	)			767,936

Net Loss

Our net loss was US$ 32,056,433 for the year ended June 30, 2021, an increase of US$ 25,545,892 or 392.38%, from a net loss of US$ 6,510,541 for the year ended June 30, 2020. The increase in net loss was primarily a result of the decrease in gross profit, the increase in general and administrative expenses, partially offset by the decrease in impairment loss on an unconsolidated entity.

Comprehensive Loss

The comprehensive loss was US$ 26,407,588 for the year ended June 30, 2021, an increase of US$ 17,765,012 from a comprehensive loss of US$ 8,642,576 for the year ended June 30, 2020. After deduction of non-controlling interest, the comprehensive loss attributable to us was US$ 25,893,417 for the year ended June 30, 2021, compared to a comprehensive loss attributable to us in the amount of US$ 8,728,483 for the year ended June 30, 2020. The significant increase of comprehensive loss was due to the increase in net loss as mentioned above, which was partially offset by an increase in the recorded income of foreign currency translation where the financial statements denominated in RMB were translated to the USD denomination.

Treasury Policies

We have established treasury policies with the objectives of achieving effective control of treasury operations and of lowering cost of funds. Therefore, funding for all operations and foreign exchange exposure have been centrally reviewed and monitored from the top level. To manage our exposure to fluctuations in exchange rates and interest rates on specific transactions and foreign currency borrowings, currency structured instruments and other appropriate financial instruments will be used to hedge material exposure, if any.

Our policy precludes us from entering into any derivative contracts purely for speculative activities. Through our treasury policies, we aim to:

(a) Minimize interest risk

This is accomplished by loan re-financing and negotiation. We will continue to closely monitor the total loan portfolio and compare the loan margin spread under our existing agreements against the current borrowing interest rates under different currencies and new offers from banks.

(b) Minimize currency risk

In view of the current volatile currency market, we will closely monitor the foreign currency borrowings at the company level. As of June 30, 2021 and 2020, except the above-mentioned convertible note, we did not engage in any foreign currency borrowings or loan contracts.

Liquidity and Capital Resources

We currently finance our business operations primarily through proceeds from our initial public offering, as well as from short-term loans, convertible notes and the sale of our common stock. Our current cash primarily consists of cash on hand and cash in bank, which is unrestricted as to withdrawal and use and is deposited with banks in China.

On September 5, 2019, we entered into a securities purchase agreement with select investors whereby we sold 310,977 shares of common stock at a purchase price of US$ 4.68 per share, for the net proceeds of approximately US$ 1.5 million.

On December 10, 2020, we entered into a securities purchase agreement with select investors whereby we sold purchase, up to 604,900 shares of common stock at a purchase price of US$ 2.73 per share. The net proceeds that we received was US$ 1.6 million.

On January 27, 2021, we issued 364,445 shares of common stock to two investors at a price of US$ 3.0 per share. The net proceeds that we received was US$ 1.1 million.

On June 16, 2021, we entered into a securities purchase agreement pursuant to which we issued an unsecured convertible promissory note with a one-year maturity to an institutional accredited investor Streeterville Capital, LLC ("Investor"). The convertible promissory note has the original principal amount of US$ 3,170,000 and Investor gave consideration of US$ 3.0 million, reflecting original issue discount of US$ 150,000 and Investor's legal fee of US$ 20,000. We received principal in full from the Investor.

Management believes that our current cash, cash flows from future operations, and access to loans will be sufficient to meet our working capital needs for at least the next 12 months. We intend to continue to carefully execute our growth plans and manage market risk.

Working Capital

The following table provides the information about our working capital at June 30, 2021 and 2020:

	March 31, 2021		June 30, 2020

Current Assets	$	49,278,577		$	59,519,998
Current Liabilities		14,795,390			11,347,325
Working Capital	$	34,483,187		$	48,172,673

The working capital decreased by US$ 13,689,486, or 28.4%, as of June 30, 2021 from June 30, 2020, primarily as a result of a decrease in cash, accounts receivable and advances to suppliers, and an increase in other payables and accrued expenses, and convertible note payable as of March 31, 2021.

Capital Commitments and Contingencies

Capital commitments refer to the allocation of funds for the possible purchase in the near future for fixed assets or investment. Contingency refers to a condition that arises from past transactions or events, the outcome of which will be confirmed only by the occurrence or non-occurrence of uncertain futures events.

As of March 31, 2021 and 2020, we had no material capital commitments or contingent liabilities.

Off-Balance Sheet Commitments and Arrangements

We have not entered into any other financial guarantees or other commitments to guarantee the payment obligations of any third parties. In addition, we have not entered into any derivative contracts that are indexed to our own common stock and classified as stockholders' equity, or that are not reflected in our consolidated financial statements.

Cash Flows

The following table provides detailed information about our net cash flows for the years ended June 30, 2021 and 2020.

	Years Ended June 30,
	2021			2020

Net cash used in operating activities	$	(14,649,557	)		$	(4,656,007	)
Net cash provided by investing activities		1,262,305				104,776
Net cash provided by financing activities		7,235,931				2,625,407
Effect of exchange rate changes on cash		2,804,343				(1,033,480	)
Net decrease in cash		(3,346,978	)			(2,959,304	)
Cash, beginning of the year		32,371,372				35,330,676
Cash, end of the year	$	29,024,394			$	32,371,372
Less: cash of discontinued operations - ended of the Year		12,681,483				10,371,673
Cash of continuing operations - ended of the Year		16,342,911				21,999,699

Operating Activities

Net cash used in operating activities during the year ended June 30, 2021 was approximately US$ 14.6 million, consisting of net loss from continuing operations of US$ 21.4 million, bad debt expenses of US$ 13.5 million, stock written off due to natural disaster of US$ 3.9 million, and net changes in our operating assets and liabilities, which mainly included an increase in inventories of US$ 4.6 million, advances to suppliers of US$ 3.3 million and accounts receivables of US$ 2.8 million, partially offset by the net cash provided by operating activities from discontinued operations of US$ 0.7 million. Net cash used in operating activities during the year ended June 30, 2020 was approximately US$ 4.7 million, consisting of net loss from continuing operations of US$ 7.3 million, bad debt expenses of US$ 3.8 million, impairment loss on an unconsolidated entity of US$ 2.1 million, restricted shares issued for management of US$ 1.0 million, and net changes in our operating assets and liabilities, which mainly included an increase in advances to suppliers of US$ 3.8 million and accounts receivables of US$ 2.1 million, and net cash provided by operating activities from discontinued operations of US$ 0.6 million.

Investing Activities

For the year ended June 30, 2021, net cash provided by investing activities was US$ 1.3 million, primarily due to the net cash provided by investing activities from discontinued operations. For the year ended June 30, 2020, net cash provided by investing activities was US$ 104,776, primarily due to the proceeds from disposal of property and equipment of US$ 79,225, as well as repayment of loans to third parties of US$ 38,279 during the year ended June 30, 2020.

Financing Activities

For the year ended June 30, 2021, net cash provided financing activities amounted to approximately US$ 7.2 million, primarily due to the proceeds from issuance of common stock of US$ 5.2 million, proceeds from issuance of convertible note of US$ 3.0 million partially offset by the net cash used in financing activities from discontinued operations of US$ 0.7 million. For the year ended June 30, 2020, net cash provided by financing activities amounted to approximately US$ 2.6 million, primarily due to the proceeds from issuance of common stock of US$ 1.5 million and proceeds from advances from related parties of US$ 1.1 million.

Item 8.

Financial Statements and Supplementary Data

The financial statements required by this item are set forth beginning on page F-1.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Table of Contents

Report of Independent Registered Public Accounting Firm	F-2

Consolidated Balance Sheets as of June 30, 2021 and 2020	F-4

Consolidated Statements of Operations and Comprehensive Income (Loss) For the Years Ended June 30, 2021 and 2020	F-5

Consolidated Statements of Equity For the Years Ended June 30, 2021 and 2020	F-6

Consolidated Statements of Cash Flows For the Years Ended June 30, 2021 and 2020	F-7

Notes to Consolidated Financial Statements	F-8

F-1

Unit 1304, 13/F., Two Harbourfront, 22 Tak Fung Street, Hunghom, Hong Kong

香港紅磡德豐街22號海濱廣場二期13樓1304室

Tel : (852) 2126 2388 Fax: (852) 2122 9078

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To:	The Board of Directors and Shareholders of Shineco, Inc..

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Shineco, Inc. and subsidiaries (the "Company") as of June 30, 2021 and 2020, and the related consolidated statements of income (loss) and comprehensive loss, changes in equity and cash flows for each of the years in the two-year period ended June 30, 2021, 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 consolidated financial position of the Company as of June 30, 2021 and 2020, and the consolidated results of its operations and its cash flows for each of the years in the two-year period ended June 30, 2021, 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 Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the 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. 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.

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. 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.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

F-2

Impairment assessment of trade receivables

As at 30 June 2021, the Company recorded trade receivables of approximately US$ 19.6 million before impairment of US$ 13.5 million. Accounts receivable are recorded at net realizable value consisting of the carrying amount less an allowance for uncollectible accounts as needed. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in the Company's existing accounts receivable balance. The Company's determination of allowance for doubtful accounts is combining with collection history and various subjective factors and considerations. Specifically, there was a high degree of subjective auditor judgment in evaluating how the Company's estimation on the amount of probable credit losses and related impairment of accounts receivable affected the net realizable value of accounts receivable.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included the following, among others: (i) obtaining an understanding of and evaluating the Company's process over the collection and the assessment of the recoverability of trade receivables. (ii) We tested the completeness and accuracy of the historical data used in management's calculation. (iii) tested the ageing of trade receivables at the year ended date on a sampling basis. (iv) tested the subsequent settlements by customers on a sampling basis. (v) We evaluated the reasonableness of the factors included in considering of probable credit losses such as Customer-specific risks, changes in economic conditions that may not be captured in the quantitatively derived results, and other relevant factors.

Inventory write-down

As described in Note 2 and 3 of the consolidated financial statements, inventories are stated at the lower of cost and net realizable value, with cost determined on a first in first out method. Write-down of potential obsolete or slow moving inventories is recorded based on management's assumptions about future demands and market conditions. For the year ended June 30, 2021, the Company recorded an accumulated inventory impairment of $1.35 million. Inventories include items that have been written down to the Company's best estimate of their realizable value, which includes consideration of various factors.

We identified the inventory write-down as a critical audit matter. The Company's determination of future markdowns is subjective. Specifically, there was a high degree of subjective auditor judgment in evaluating how the Company's merchandising strategy and related inventory markdown assumptions affected the realizable value of inventory.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included the following, among others: (i) observing the physical condition of inventories during inventory counts; (ii) evaluating the appropriateness of management's process for developing the estimates of net realizable value (iii) testing the reliability of reports used by management by agreeing to underlying records; (iv) testing the reasonableness of the assumptions about quality, damages, future demand, selling prices and market conditions by considering with historical trends and consistency with evidence obtained in other areas of the audit; and corroborating the assumptions with individuals within the product team; and (v) assessing the Company's adjustments of inventory costs to net realizable value for slow-moving and obsolete inventories by (1) comparing the historical estimate for net realizable value adjustments to actual adjustments of inventory costs, and (2) analyzing sales subsequent to the measurement date.

/s/ Centurion ZD CPA& Co.
Centurion ZD CPA & Co.

We have served as the Company's auditor since 2019.
Hong Kong, China
September 30, 2021

F-3

SHINECO, INC.

CONSOLIDATED BALANCE SHEETS

	June 30,			June 30,
	2021			2020
ASSETS

CURRENT ASSETS:
Cash	$	16,342,911			$	21,999,699
Accounts receivable, net		2,686,671				5,058,350
Due from related parties		132,398				120,939
Inventories, net		1,323,391				699,485
Advances to suppliers, net		7,790,126				11,186,287
Other current assets		1,343,338				905,380
Current assets held for discontinued operations		19,659,742				19,549,858
TOTAL CURRENT ASSETS		49,278,577				59,519,998

Property and equipment, net		2,253,944				2,431,930
Distribution rights		1,142,794				1,043,887
Long-term deposit and other noncurrent assets		14,550				20,333
Right of use assets		3,585,703				3,227,895
Non-current assets held for discontinued operations		5,043,031				12,844,568
TOTAL ASSETS	$	61,318,599			$	79,088,611

LIABILITIES AND EQUITY

CURRENT LIABILITIES:
Accounts payable	$	76,584			$	105,242
Advances from customers		7,468				6,324
Due to related parties		1,159,407				1,355,919
Other payables and accrued expenses		4,109,208				1,555,253
Operating lease liabilities - current		434,411				97,633
Convertible note payable		2,933,030				-
Taxes payable		1,208,348				1,467,833
Current liabilities held for discontinued operations		4,866,934				6,759,121
TOTAL CURRENT LIABILITIES		14,795,390				11,347,325

Income tax payable - noncurrent portion		506,441				566,022
Operating lease liabilities - non-current		352,863				401,891
Deferred tax liability		285,699				260,972
TOTAL LIABILITIES		15,940,393				12,576,210

Commitments and contingencies		-				-

EQUITY:
Common stock; par value $0.001, 100,000,000shares authorized; 7,881,482and 3,039,943shares issued and outstanding at June 30, 2021 and June 30, 2020*	7,881				3,040
Additional paid-in capital		41,105,806				27,302,051
Subscription receivable		(8,535,203	)			-
Statutory reserve		4,198,107				4,198,107
Retained earnings		8,661,071				40,106,518
Accumulated other comprehensive loss		(731,805	)			(6,283,835	)
Total Stockholders' equity of Shineco, Inc.		44,705,857				65,325,881
Non-controlling interest		672,349				1,186,520
TOTAL EQUITY		45,378,206				66,512,401

TOTAL LIABILITIES AND EQUITY	$	61,318,599			$	79,088,611

*	Retrospectively restated for effect of stock split on August 14, 2020

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

F-4

SHINECO, INC.

CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS

	For the Years Ended June 30,
	2021			2020

REVENUE	$	3,021,704			$	10,418,576

COST OF REVENUE
Cost of product and services		3,309,398				7,514,606
Stock written off due to natural disaster		3,942,784				-
Business and sales related tax		5,673				8,413
Total cost of revenue		7,257,855				7,523,019

GROSS PROFIT (LOSS)		(4,236,151	)			2,895,557

OPERATING EXPENSES
General and administrative expenses		17,131,400				7,686,715
Selling expenses		45,384				297,199
Total operating expenses		17,176,784				7,983,914

LOSS FROM OPERATIONS		(21,412,935	)			(5,088,357	)

OTHER INCOME (EXPENSE)
Impairment loss on an unconsolidated entity		-				(2,062,035	)
Other income (loss), net		(55,746	)			38,868
Interest income, net		29,236				77,523
Total other loss		(26,510	)			(1,945,644	)

LOSS BEFORE PROVISION FOR INCOME TAXES FROM CONTINUING OPERATIONS		(21,439,445	)			(7,034,001	)

PROVISION FOR INCOME TAXES		-				244,476

NET LOSS FROM CONTINUING OPERATIONS		(21,439,445	)			(7,278,477	)

DISCONTINUED OPERATIONS:
Income (loss) from discontinued operations, net of taxes		(10,616,988	)			767,936
Net income (loss) from discontinued operations		(10,616,988	)			767,936

NET LOSS		(32,056,433	)			(6,510,541	)

Net income (loss) attributable to non-controlling interest		(610,986	)			118,131

NET LOSS ATTRIBUTABLE TO SHINECO, INC.	$	(31,445,447	)		$	(6,628,672	)

COMPREHENSIVE LOSS
Net loss	$	(32,056,433	)		$	(6,510,541	)
Other comprehensive income (loss): foreign currency translation income (loss)		5,648,845				(2,132,035	)
Total comprehensive loss		(26,407,588	)			(8,642,576	)
Less: comprehensive income (loss) attributable to non-controlling interest		(514,171	)			85,907

COMPREHENSIVE LOSS ATTRIBUTABLE TO SHINECO, INC.	$	(25,893,417	)		$	(8,728,483	)

Weighted average number of shares basic and diluted*	4,401,048				2,949,166

Basic and diluted loss per common share	$	(7.14	)		$	(2.25	)

Earnings (loss) per common share
Continuing operations - Basic and Diluted		(4.86	)			(2.45	)
Discontinued operations - Basic and Diluted		(2.28	)			0.20
Net loss per common share - basic and diluted		(7.14	)			(2.25	)

*	Retrospectively restated for effect of stock split on August 14, 2020

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

F-5

SHINECO, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

FOR THE YEARS ENDED JUNE 30, 2021 AND 2020

															ACCUMULATED
	COMMON STOCK		SUBSCRIPTION			ADDITIONAL PAID-IN		STATUTORY		RETAINED		OTHER COMPREHENSIVE			NON- CONTROLLING		TOTAL
	SHARES*		AMOUNT			RECEIVABLE		CAPITAL		RESERVE		EARNINGS			LOSS		INTEREST		EQUITY
Balance at June 30, 2019		2,544,203		$	2,544		$	-		$	24,779,684		$	4,198,107		$	46,735,190		$	(4,184,024	)	$	1,100,613			72,632,114

Stock issuance		495,740			496			-			2,522,367			-			-			-			-			2,522,863
Net income (loss) for the year		-			-			-			-			-			(6,628,672	)		-			118,131			(6,510,541	)
Foreign currency translation loss		-			-			-			-			-			-			(2,099,811	)		(32,224	)		(2,132,035	)
Balance at June 30, 2020		3,039,943		$	3,040		$	-		$	27,302,051		$	4,198,107		$	40,106,518		$	(6,283,835	)	$	1,186,520		$	66,512,401

Stock issuance		4,841,539			4,841			(8,535,203	)		13,736,785			-			-			-			-			5,206,423
Beneficial conversion feature associated with convertible notes		-			-			-			66,970			-			-			-			-			66,970
Net loss for the year		-			-			-			-			-			(31,445,447	)		-			(610,986	)		(32,056,433	)
Foreign currency translation gain		-			-			-			-			-			-			5,552,030			96,815			5,648,845
Balance at June 30, 2021		7,881,482		$	7,881		$	(8,535,203	)	$	41,105,806		$	4,198,107		$	8,661,071		$	(731,805	)	$	672,349		$	45,378,206

*	Retrospectively restated for effect of stock split on August 14, 2020.

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

F-6

SHINECO, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS


	For the Years Ended June 30,
	2021			2020

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(32,056,433	)		$	(6,510,541	)
Net income (loss) from discontinued operations, net of tax		(10,616,988	)			767,935
Net loss from continuing operations		(21,439,445	)			(7,278,476	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		697,093				845,792
Loss from disposal of property and equipment		142,982				60,211
Provision for doubtful accounts		13,462,790				3,862,075
Provision for inventory reserve		118,598				205,442
Stock written off due to natural disaster		3,942,784				-
Deferred tax benefit		-				244,476
Amortization of right of use assets		181,257				-
Impairment loss on an unconsolidated entity		-				2,062,035
Restricted shares issued for management		-				1,022,660

Changes in operating assets and liabilities:
Accounts receivable		(2,833,647	)			(2,094,744	)
Advances to suppliers		(3,345,800	)			(3,769,413	)
Inventories		(4,605,123	)			154,758
Other receivables		(169,289	)			(457,993	)
Prepaid expense and other assets		(336,839	)			442,796
Due from related parties		-				62,438
Right of use assets		-				(340,610	)
Accounts payable		(37,668	)			(76,889	)
Advances from customers		530				(366,762	)
Other payables		(274,912	)			54,803
Operating lease liabilities		(433,869	)			-
Taxes payable		(430,216	)			70,677
Net cash used in operating activities from continuing operations		(15,360,774	)			(5,296,724	)
Net cash provided by operating activities from discontinued operations		711,217				640,717
Net cash used in operating activities		(14,649,557	)			(4,656,007	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions of property and equipment		-				(11,050	)
Proceeds from disposal of property and equipment		-				79,225
Repayments of loans to third parties		-				38,279
Net cash provided by investing activities from continuing operations		-				106,454
Net cash provided by (used in) investing activities from discontinued operations		1,262,305				(1,678	)
Net cash provided by investing activities		1,262,305				104,776

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of other short-term loans		-				(7,110	)
Proceeds from issuance of common stock		5,206,423				1,500,203
Proceeds from advances from related parties		(291,022	)			1,132,314
Proceeds from issuance of convertible note		3,000,000				-
Net cash provided by financing activities from continuing operations		7,915,401				2,625,407
Net cash used in financing activities from discontinued operations		(679,470	)			-
Net cash provided by financing activities		7,235,931				2,625,407

EFFECT OF EXCHANGE RATE CHANGE ON CASH		2,804,343				(1,033,480	)

NET DECREASE IN CASH		(3,346,978	)			(2,959,304	)

CASH - Beginning of the Year		32,371,372				35,330,676

CASH - End of the Year		29,024,394				32,371,372

Less: cash of discontinued operations - Ended of the Year		12,681,483				10,371,673

Cash of continuing operations - Ended of the Year	$	16,342,911			$	21,999,699

SUPPLEMENTAL CASH FLOW DISCLOSURES:
Cash paid for income taxes	$	668,477			$	670,769
Cash paid for interest	$	115,806			$	116,438

SUPPLEMENTAL NON-CASH OPERATING ACTIVITY:
Right-of-use assets obtained in exchange for operating lease obligations	$	668,302			$	900,356

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

F-7

NOTE 1 - ORGANIZATION AND NATURE OF OPERATIONS

Shineco, Inc. ("Shineco" or the "Company") was incorporated in the State of Delaware on August 20, 1997. The Company is a holding company whose primary purpose is to develop business opportunities in the People's Republic of China (the "PRC" or "China").

On December 30, 2004, the Company acquired all of the issued and outstanding shares of Beijing Tenet-Jove Technological Development Co., Ltd. ("Tenet-Jove"), a PRC company, in exchange for restricted shares of the Company's common stock, and the sole operating business of the Company became that of its subsidiary, Tenet-Jove. Tenet-Jove was incorporated on December 15, 2003 under the laws of China. Consequently, Tenet-Jove became a 100% owned subsidiary of Shineco and was officially granted the status of a wholly foreign-owned entity by Chinese authorities on July 14, 2006. This transaction was accounted for as a recapitalization. Tenet-Jove owns 90% interest of Tianjin Tenet Huatai Technological Development Co., Ltd. ("Tenet Huatai").

On December 31, 2008, June 11, 2011, and May 24, 2012, Tenet-Jove entered into a series of contractual agreements including an Executive Business Cooperation Agreement, a Timely Reporting Agreement, an Equity Interest Pledge Agreement, and an Executive Option Agreement (collectively, the "VIE Agreements"), with each one of the following entities, Ankang Longevity Pharmaceutical (Group) Co., Ltd. ("Ankang Longevity Group"), Yantai Zhisheng International Freight Forwarding Co., Ltd. ("Zhisheng Freight"), Yantai Zhisheng International Trade Co., Ltd. ("Zhisheng Trade"), Yantai Mouping District Zhisheng Agricultural Produce Cooperative ("Zhisheng Agricultural"), and Qingdao Zhihesheng Agricultural Produce Services., Ltd. ("Qingdao Zhihesheng"). On February 24, 2014, Tenet-Jove entered into the same series of contractual agreements with Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. ("Zhisheng Bio-Tech"), which was incorporated in 2014. Zhisheng Bio-Tech, Zhisheng Freight, Zhisheng Trade, Zhisheng Agricultural, and Qingdao Zhihesheng are collectively referred to herein as the "Zhisheng VIEs."

Pursuant to the VIE Agreements, Tenet-Jove has the exclusive right to provide to the Zhisheng VIEs and Ankang Longevity Group consulting services related to their business operations and management. All the above contractual agreements obligate Tenet-Jove to absorb a majority of the risk of loss from the Zhisheng VIEs and Ankang Longevity Group's activities and entitle Tenet-Jove to receive a majority of their residual returns. In essence, Tenet-Jove has gained effective control over the Zhisheng VIEs and Ankang Longevity Group. Therefore, the Zhisheng VIEs and Ankang Longevity Group are treated as variable interest entities ("VIEs") under the Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 810 "Consolidation." Accordingly, the accounts of these entities are consolidated with those of Tenet-Jove.

Since Shineco is effectively controlled by the majority shareholders of the Zhisheng VIEs and Ankang Longevity Group, Shineco owns 100% of Tenet-Jove. Accordingly, Shineco, Tenet-Jove, and its VIEs, the Zhisheng VIEs and Ankang Longevity Group are effectively controlled by the same majority shareholders. Therefore, Shineco, Tenet-Jove, and the VIEs of Tenet-Jove are considered under common control. The consolidation of Tenet-Jove and its VIEs into Shineco was accounted for at historical cost and prepared on the basis as if the aforementioned exclusive contractual agreements between Tenet-Jove and its VIEs had become effective as of the beginning of the first period presented in the accompanying consolidated financial statements.

F-8

On May 2, 2017, the Company entered into a Strategic Cooperation Agreement with Beijing Zhongke Biorefinery Engineering Technology Co., Ltd. ("Biorefinery"), a leading high-tech biomass refining company financially backed by the Chinese Academy of Sciences Institute of Process Engineering, to establish the Institute of Chinese Apocynum Industrial Technology Research ("ICAITR"). Pursuant to the Strategic Cooperation Agreement, the two parties agreed to establish the ICAITR, with the Company and Biorefinery owning 80% and 20% of the equity interests of ICAITR, respectively. Shineco invested RMB5.0million (US$737,745) as the registered capital, and Biorefinery would invest a technology patent named "Steam Explosion Degumming."

On September 30, 2017, Tenet-Jove established Xinjiang Shineco Taihe Agriculture Technology Ltd. ("Xinjiang Taihe") with registered capital of RMB10.0million (US$1,502,650). On September 30, 2017, Tenet-Jove established Xinjiang Tianyi Runze Bioengineering Co., Ltd. ("Runze") with registered capital of RMB10.0million (US$1,502,650). Xinjiang Taihe and Runze became wholly-owned subsidiaries of Tenet-Jove.

On December 10, 2016, Tenet-Jove entered into a purchase agreement with Tianjin Tajite E-Commerce Co., Ltd. ("Tianjin Tajite"), an online e-commerce company based in Tianjin, China, specializing in distributing Luobuma related products and branded products of Daiso 100-yen shops, pursuant to which Tenet-Jove would acquire a 51% equity interest in Tianjin Tajite for cash consideration of RMB14,000,000(approximately US$2.1million). On December 25, 2016, the Company paid the full amount as the deposit to secure the deal. In May, 2017, the Company amended the agreement and required Tianjin Tajite to satisfy certain preconditions related to product introductions into China. On October 26, 2017, the Company completed the acquisition for 51% of the shares in Tianjin Tajite.

On October 27, 2017, the Company, through its subsidiary Tianjin Tajite, obtained contractual rights to distribute branded products of Daiso Industries Co., Ltd. ("Daiso"), a large franchise of 100-yen shops founded in Japan, via JD.com, one of the largest e-commerce companies and one of the largest retailers in China. On November 3, 2017, the Company further developed the cooperation with Daiso by entering into a supply and purchase agreement (the "Daiso Agreement") for the purpose of establishing a continuous supply and sale of Daiso's products in China. Pursuant to the Daiso Agreement, the Company planned to purchase Daiso Products in the amount of approximately RMB20million by August 2018 and add orders as circumstance requires. The term of the Daiso Agreement is for one year, and it renews for an additional one-year at the end of each term unless terminated by written notice by either Tianjin Tajite or Daiso. Due to the policy of China Customs, many of the bestselling products of Daiso are not allowed to be imported through the general form of trade model, but only through cross-border e-commence business model. As a result, the Company and Daiso agreed to suspend the cooperation temporarily and wait for the opening of the China-Japan-South Korea Free Trade Zone.

On November 1, 2017, the Company established an Apocynum Industrial Park in Xinjiang, China. The industrial park is focusing on planting and purchasing Bluish Dogbane and processing and distributing Bluish Dogbane preliminary products.

On March 13, 2019, Tenet-Jove established Beijing Tenjove Newhemp Biotechnology Co., Ltd. ("TNB") with registered capital of RMB10.0million (US$1,502,650). TNB became a wholly-owned subsidiary of Tenet-Jove.

On August 22, 2019, Tenet-Jove established Shineco Zhong Hemp Group Co., Ltd. ("Zhong Hemp") with registered capital of RMB200.0million (US$28,237,022) and owns 60% interest of Zhong Hemp.

The Company ceased the business operation of Xinjiang Taihe and Runze in September 2020 and October 2020, respectively.

F-9

The Company, its subsidiaries, its VIEs, and its VIEs' subsidiaries (collectively the "Group") operate three main business segments: 1) Tenet-Jove is engaged in manufacturing and selling Bluish Dogbane and related products, also known in Chinese as "Luobuma," including therapeutic clothing and textile products made from Luobuma; 2) the Zhisheng VIEs are engaged in planting, processing, and distributing green agricultural produce as well as providing domestic and international logistic services for agricultural products ("Agricultural Products"); and, 3) Ankang Longevity Group, which is reclassified as discontinued operations, manufactures traditional Chinese medicinal herbal products as well as other retail pharmaceutical products. These different business activities and products can potentially be integrated and benefit from one another.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("US GAAP").

The consolidated financial statements of the Company reflect the principal activities of the Company, its subsidiaries, its VIEs and its VIEs' subsidiaries. The non-controlling interest represents the minority shareholders' interest in the Company's majority owned subsidiaries and VIEs. All intercompany accounts and transactions have been eliminated in consolidation.

Consolidation of Variable Interest Entities

The total carrying amount of the VIEs and their subsidiaries' consolidated assets and liabilities and income information were as follows:

	June 30, 2021			June 30, 2020

Current assets	$	44,631,744			$	58,350,565
Plant and equipment, net		4,698,184				8,168,594
Other non-current assets		4,894,445				11,054,954
Total assets		54,224,373				77,574,113
Total liabilities		(7,377,886	)			(6,189,172	)
Net assets	$	46,846,487			$	71,384,941

	For the years ended June 30,
	2021			2020
Net sales	$	10,991,641			$	23,516,385
Gross profit (loss)	$	(3,165,304	)		$	6,197,221
Loss from operations	$	(22,319,655	)		$	(2,661,451	)
Net loss	$	(27,754,161	)		$	(197,776	)

F-10

The carrying amount of the VIEs and their subsidiaries' consolidated assets and liabilities and income information held for discontinued operations were as follows:

	June 30, 2021			June 30, 2020

Current assets	$	19,659,742			$	19,549,858
Plant and equipment, net		3,683,525				7,057,554
Other non-current assets		1,359,506				5,787,014
Total assets		24,702,773				32,394,426
Total liabilities		(4,866,934	)			(4,331,447	)
Net assets	$	19,835,839			$	28,062,979

	For the years ended June 30,
	2021			2020
Net sales	$	8,085,527			$	13,266,050
Gross profit	$	986,174			$	3,224,255
Income (loss) from operations	$	(4,544,819	)		$	1,598,745
Net income (loss)	$	(10,038,088	)		$	767,936

The carrying amount of the VIEs and their subsidiaries' consolidated assets and liabilities and income information held for continued operations were as follows:

	June 30, 2021			June 30, 2020

Current assets	$	24,972,002			$	38,800,707
Plant and equipment, net		1,014,659				1,111,040
Other non-current assets		3,534,939				5,267,940
Total assets		29,521,600				45,179,687
Total liabilities		(2,510,952	)			(1,857,725	)
Net assets	$	27,010,648			$	43,321,962

	For the years ended June 30,
	2021			2020
Net sales	$	2,906,114			$	10,250,335
Gross profit (loss)	$	(4,151,478	)		$	2,972,966
Income (loss) from operations	$	(17,774,836	)		$	1,062,706
Net loss	$	(17,716,073	)		$	(965,712	)

Non-controlling Interests

U.S. GAAP requires that non-controlling interests in subsidiaries and affiliates be reported in the equity section of a company's balance sheet. In addition, the amounts attributable to the non-controlling interests in the net income of these entities are reported separately in the consolidated statements of loss and comprehensive loss.

Risks and Uncertainties

The operations of the Company are located in the PRC and 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, and legal environment 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. Although the Company has not experienced losses from these factors and believes that it is in compliance with existing laws and regulations, there is no guarantee that the Company will continue to do so in the future.

Members of the current management team own controlling interests in the Company and are also the owners of the VIEs in the PRC. The Company only controls the VIEs through contractual arrangements, which obligate it to absorb the risk of loss and to receive the residual expected returns. As such, the controlling shareholders of the Company and the VIEs could cancel these agreements or permit them to expire at the end of the agreement terms, as a result of which the Company would not retain control of the VIEs. In addition, should these agreements be challenged or litigated, they would also be subject to the laws and courts of the PRC legal system, which could make enforcing the Company's rights difficult.

F-11

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. 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 date of the consolidated financial statements as well as the reported amounts of revenue and expenses during the reporting periods. Significant estimates required to be made by management include, but are not limited to, useful lives of property, plant, and equipment, and intangible assets, the recoverability of long-lived assets, and the valuation of accounts receivable, deferred taxes, and inventory reserves. Actual results could differ from those estimates.

Revenue Recognition

Sales of products: The Company recognized revenue from the sale of products when the goods were delivered and title to the goods passed to the customer, provided that there were no uncertainties regarding customer acceptance; persuasive evidence of an arrangement existed; the sales price was fixed or determinable; and collectability was deemed probable.

Revenue from the provision of services: Revenue from international freight forwarding, domestic air, and overland freight forwarding services was recognized upon the performance of services as stipulated in the underlying contract or when commodities were being released from the customer's warehouse; the service price was fixed or determinable; and collectability was deemed probable.

With the adoption of ASC 606, "Revenue from Contracts with Customers," revenue is recognized when all of the following five steps are met: (i) identify the contract(s) with the customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations; (v) recognize revenue when (or as) each performance obligation is satisfied. The Company adopted the new revenue standard beginning July 1, 2018, and adopted a modified retrospective approach upon adoption. The Company believes that its previous revenue recognition policies are generally consistent with the new revenue recognition standards set forth in ASC 606. Potential adjustments to input measures are not expected to be pervasive to the majority of the Company's contracts. There is no significant impact upon adoption of the new guidance.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash on hand, cash on deposit, and other highly liquid investments which are unrestricted as to withdrawal or use, and which have original maturities of three months or less when purchased. The Company maintains cash with various financial institutions mainly in the PRC. As of June 30, 2021 and 2020, the Company had nocash equivalents.

Under PRC law, it is generally required that a commercial bank in the PRC that holds third-party cash deposits protect the depositors' rights over and interests in their deposited money. PRC banks are subject to a series of risk control regulatory standards, and PRC bank regulatory authorities are empowered to take over the operation and management of any PRC bank that faces a material credit crisis. The Company monitors the banks utilized and has not experienced any problems.

F-12

Accounts Receivable, Net

Accounts receivable are recorded at net realizable value, consisting of the carrying amount less an allowance for uncollectible accounts, as necessary. 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 balances. In evaluating the collectability of individual receivable balances, the Company considers many factors, including the age of the balance, the customers' historical payment history, their current credit-worthiness, and current economic trends. The fair value of long-term receivables is determined using a present value technique by discounting the future expected contractual cash flows using current rates at which similar instruments would be issued at the measurement date. As of June 30, 2021 and 2020, the allowance for doubtful accounts from the continuing operations was US$9,805,402and US$3,698,036, respectively. As of June 30, 2021 and 2020, the allowance for doubtful accounts from the discontinued operations was US$3,675,619and US$1,537,400, respectively. Accounts are written off against the allowance after efforts at collection prove unsuccessful.

Inventories, Net

Inventories, which are stated at the lower of cost or net realizable value, consist of raw materials, work-in-progress, and finished goods related to the Company's products. Cost is determined using the first in first out ("FIFO") method. Agricultural products that the Company farms are recorded at cost, which includes direct costs such as seed selection, fertilizer, labor cost and contract fees that are spent in growing agricultural products on the leased farmland, and indirect costs which include amortization of prepayments of farmland leases and farmland development costs. All the costs are accumulated until the time of harvest and then allocated to the harvested crops costs when they are sold. The Company periodically evaluates its inventory and records an inventory reserve for certain inventories that may not be saleable or whose cost exceeds net realizable value. As of June 30, 2021 and 2020, the inventory reserve from the continuing operations was US$1,349,288and US$1,121,408, respectively. As of June 30, 2021 and 2020, the inventory reserve from the discontinued operations were both US$ nil.

Advances to Suppliers, Net

Advances to suppliers consist of payments to suppliers for materials that have not been received. Advances to suppliers are reviewed periodically to determine whether their carrying value has become impaired. As of June 30, 2021 and 2020, the Company had an allowance for uncollectible advances to suppliers from the continuing operations of US$11,546,609and US$3,342,590, respectively. As of June 30, 2021 and 2020, the Company had an allowance for uncollectible advances to suppliers from the discontinued operations of US$1,773,698and US$ nil, respectively.

Business Acquisitions

Business acquisitions are accounted for under the acquisition method. The acquisition method requires the reporting entity to identify the acquirer, determine the acquisition date, recognize and measure the identifiable assets acquired, the liabilities assumed and any non-controlling interest in the acquired entity, and recognize and measure goodwill or a bargain gain from the purchase. The acquiree's results are included in the Company's consolidated financial statements from the date of acquisition. Assets acquired and liabilities assumed are recorded at their fair values on the date acquired and the excess of the purchase price over the amounts assigned is recorded as goodwill, or if the fair value of the net assets acquired exceeds the purchase price consideration, a bargain purchase gain is recorded. Adjustments to fair value assessments are generally recorded to goodwill over the measurement period (not longer than 12 months). The acquisition method also requires that acquisition-related transaction and post-acquisition restructuring costs be charged to expense as committed, and requires the Company to recognize and measure certain assets and liabilities, including those arising from contingencies and contingent consideration in a business combination.

F-13

Goodwill

Goodwill represents the excess of the purchase price over the fair value of assets acquired. The goodwill impairment test compares the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of a reporting unit exceeds its fair value, goodwill of the reporting unit would be considered impaired. To measure the amount of the impairment loss, the implied fair value of a reporting unit's goodwill is compared to the carrying amount of that goodwill. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. If the carrying amount of a reporting unit's goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess. For each of these tests, the fair value of each of the Company's reporting units is determined using a combination of valuation techniques, including a discounted cash flow methodology. To corroborate the discounted cash flow analysis performed at each reporting unit, a market approach is utilized using observable market data such as comparable companies in similar lines of business that are publicly traded or which are part of a public or private transaction (to the extent available).

Leases

The Company adopted ASU 2016-02, "Leases" on July 1, 2019 and used the alternative transition approach, which permits the effects of adoption to be applied at the effective date. The new standard provides a number of optional practical expedients in transition. The Company elected the "package of practical expedients," which permits it not to reassess under the new standard its prior conclusions about lease identification, lease classification, and initial direct costs. The Company also elected the short-term lease exemption and combining the lease and non-lease components practical expedients. The most significant impact upon adoption relates to the recognition of new Right-of-use ("ROU") assets and lease liabilities on the Company's balance sheet for office space operating leases. Upon adoption, the Company recognized additional operating liabilities of approximately US$0.5million, with corresponding ROU assets of US$3.6million based on the present value of the remaining rental payments under current leasing standards for existing operating leases. There was no cumulative effect of adopting the standard.

Property and Equipment, Net

Property and equipment are stated at cost, less accumulated depreciation and amortization. Expenditures for additions, major renewals, and betterments are capitalized, and expenditures for maintenance and repairs are charged to expense as incurred. Depreciation is provided on a straight-line basis, less estimated residual value, if any, over an asset's estimated useful life. Farmland leasehold improvements are amortized over the shorter of lease term or estimated useful lives of the underlying assets. The estimated useful lives of the Company's property and equipment are as follows:

		Estimated useful lives

Buildings		20-50years
Machinery equipment		5-10years
Motor vehicles		5-10years
Office equipment		5-10years
Farmland leasehold improvements		12-18years

Land Use Rights, Net

According to Chinese laws and regulations regarding land use rights, land in urban districts is owned by the state, while land in the rural areas and suburban areas, except otherwise provided for by the state, is collectively owned by individuals designated as resident farmers by the state. In accordance with the legal principle that land ownership is separate from the right to the use of the land, the government grants individuals and companies the rights to use parcels of land for a specified period of time. Land use rights, which are usually prepaid, are stated at cost less accumulated amortization. Amortization is provided over the life of the land use rights, using the straight-line method. The useful life is 50years, based on the term of the land use rights.

Long-lived Assets

Finite-lived assets and intangibles are reviewed for impairment testing when circumstances require. For purposes of evaluating the recoverability of long-lived assets, when undiscounted future cash flows will not be sufficient to recover an asset's carrying amount, the asset is written down to its fair value. The long-lived assets of the Company that are subject to evaluation consist primarily of property, plant and equipment, land use rights, investments, and long-term prepaid leases. For the years ended June 30, 2021 and 2020, the Company did notrecognize any impairment of its long-lived assets from the continuing operations and the discontinued operations.

F-14

Fair Value of Financial Instruments

The Company follows the provisions of ASC 820, "Fair Value Measurements and Disclosures." ASC 820 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:

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the asset or liability.

The carrying value of financial instruments included in current assets and liabilities approximate their fair values because of the short-term nature of these instruments.

Income Taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the consolidated financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

The provisions of ASC 740-10-25, "Accounting for Uncertainty in Income Taxes," prescribe a more-likely-than-not threshold for consolidated financial statement recognition and measurement of a tax position taken (or expected to be taken) in a tax return. This ASC also provides guidance on the recognition of income tax assets and liabilities, classification of current and deferred income tax assets and liabilities, accounting for interest and penalties associated with tax positions, and related disclosures. The Company did not have any uncertain tax positions from the continuing operations and the discontinued operations at June 30, 2021 and 2020. The Company had not provided deferred taxes for undistributed earnings of non-U.S. subsidiaries from the continuing operations and the discontinued operations at June 30, 2021, as it is the Company's policy to indefinitely reinvest these earnings in non-U.S. operations. Quantification of the deferred tax liability, if any, associated with indefinitely reinvested earnings is not practicable.

The statute of limitations for the Company's U.S. federal income tax returns and certain state income tax returns remains open for tax year 2017 and thereafter. As of June 30, 2021, the tax years ended December 31, 2016 through December 31, 2020 for the Company's PRC subsidiaries remained open for statutory examination by PRC tax authorities.

F-15

On December 22, 2017, the "Tax Cuts and Jobs Act" ("The Act") was enacted. Under the provisions of The Act, the U.S. corporate tax rate decreased from 35% to 21%. As the Company has a June 30 fiscal year end, the lower corporate income tax rate was phased in, resulting in a U.S. statutory federal rate of approximately 28% for our fiscal year ended June 30, 2018, and 21% for subsequent fiscal years. Additionally, The Act imposes a one-time transition tax on deemed repatriation of historical earnings of foreign subsidiaries, and future foreign earnings are subject to U.S. taxation. The change in rate caused the Company to re-measure its income tax liability and record an estimated income tax expense of US$744,766for the year ended June 30, 2018. On December 22, 2017, Staff Accounting Bulletin No. 118 ("SAB 118") was issued to address the application of U.S. GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of The Act. In accordance with SAB 118, additional work is necessary to do a more detailed analysis of The Act as well as potential correlative adjustments. Any subsequent adjustment to these amounts will be recorded to current tax expense in fiscal 2019 when the analysis is complete. The Company elects to pay the transition tax over an eight-year period using specified percentages (eight percent per year for the first five years, 15 percent in year six, 20 percent in year seven, and 25 percent in year eight).

Value-Added Tax

Sales revenue represents the invoiced value of goods, net of a value-added tax ("VAT"). Before May 1, 2018, all of the Company's products that were sold in the PRC were subject to a Chinese value-added tax at a rate of 17% of the gross sales price. After May 1, 2018, the Company was subject a tax rate of 16%, and after April 1, 2019, the tax rate was further reduced to 13% based on the new Chinese tax law. This VAT may be offset by VAT paid by the Company on raw materials and other materials included in the cost of producing finished products or acquiring finished products. The Company records a VAT payable or VAT receivable in the accompanying consolidated financial statements.

Foreign Currency Translation

The Company uses the United States dollar ("U.S. dollars," "USD," or "US$") for financial reporting purposes. The Company's subsidiaries and VIEs maintain their books and records in their functional currency of Renminbi ("RMB"), the currency of the PRC.

In general, for consolidation purposes, the Company translates the assets and liabilities of its subsidiaries and VIEs into U.S. dollars using the applicable exchange rates prevailing at the balance sheet date, and the statements of income and cash flows are translated at average exchange rates during the reporting periods. As a result, amounts related to assets and liabilities reported on the statement of cash flows will not necessarily agree with changes in the corresponding balances on the balance sheet. Equity accounts are translated at historical rates. Adjustments resulting from the translation of the financial statements of the subsidiaries and VIEs are recorded as accumulated other comprehensive loss.

The balance sheet amounts, with the exception of equity, at June 30, 2021 and 2020 were translated at 1RMB to 0.1549USD and at 1RMB to 0.1414USD, respectively. The average translation rates applied to the income and cash flow statement amounts for the years ended June 30, 2021 and 2020 were 1RMB to 0.1510USD and 1RMB to 0.1422USD, respectively.

Convertible Notes Payable

In accordance with ASC 470 Debt with conversion and other option, an embedded beneficial conversion feature present in a convertible instrument shall be recognized separately at issuance by allocating a portion of the proceeds equal to the intrinsic value of that feature to additional paid-in capital. Issuance costs should be allocated proportionally to the debt host and conversion feature. Deferred financing costs will be discounted and amortized subsequently, and the fair value of the convertible notes will be assessed by an independent appraiser.

Comprehensive Loss

Comprehensive loss consists of two components, net loss and other comprehensive income (loss). The foreign currency translation gain or loss resulting from translation of the financial statements expressed in RMB to USD is reported in other comprehensive income (loss) in the consolidated statements of loss and comprehensive loss.

F-16

Equity Investment

An investment in which the Company has the ability to exercise significant influence, but does not have a controlling interest, is accounted for using the equity method. Significant influence is generally considered to exist when the Company has an ownership interest in the voting stock between 20% and 50%, and other factors, such as representation on the board of directors, voting rights, and the impact of commercial arrangements, are considered in determining whether the equity method of accounting is appropriate.

Earnings (Loss) per Share

The Company computes earnings (loss) per share ("EPS") in accordance with ASC 260, "Earnings per Share" ("ASC 260"). ASC 260 requires companies with complex capital structures to present basic and diluted EPS. Basic EPS is measured as net loss divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., outstanding convertible securities, options, and warrants) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. There is noanti-dilutive effect for the years ended June 30, 2021 and 2020.

The following table presents a reconciliation of basic and diluted earnings (loss) per share for the years ended June 30, 2021 and 2020:

	For the years ended June 30,
	2021			2020
Net loss from continuing operations attributable to Shineco	$	(21,407,359	)		$	(7,230,243	)
Net income (loss) from discontinued operations attributable to Shineco		(10,038,088	)			601,571
Net loss attributable to Shineco		(31,445,447	)			(6,628,672	)

Weighted average shares outstanding - basic and diluted*		4,401,048				2,949,166

Net loss from continuing operations per share of common share
Basic and diluted	$	(4.86	)		$	(2.45	)

Net income (loss) from discontinued operations per share of common share
Basic and diluted	$	(2.28	)		$	0.20

Net loss per share of common share
Basic and diluted	$	(7.14	)			(2.25	)

Reclassifications

Certain prior year balances were reclassified to conform to the current year's presentation with consideration of reflecting the Company's Ankang Longevity Group as discontinued operations. None of these reclassifications had an impact on reported financial position or cash flows for any of the periods presented.

New Accounting Pronouncements

In November 2019, the FASB issued ASU No. 2019-08, Compensation - Stock Compensation (Topic 718) and Revenue from Contracts with Customers (Topic 606). The guidance identifies, evaluates, and improves areas of GAAP for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided. The amendments in that ASU expanded the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. For entities that have adopted the amendments in Update 2018-07, the updated guidance is effective for annual periods beginning after December 15, 2019, and is applicable to the Company in fiscal 2021. Early adoption is permitted. The Company adopted this ASU on July 1, 2020 and the adoption of this ASU did not have a material impact on its financial statements.

F-17

In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes. The FASB is issuing this Update as part of its initiative to reduce complexity in accounting standards (the "Simplification Initiative"). The objective of the Simplification Initiative is to identify, evaluate, and improve areas of GAAP for which cost and complexity can be reduced while maintaining or improving the usefulness of the information provided to users of financial statements. The specific areas of potential simplification in this ASU were submitted by stakeholders as part of the Simplification Initiative. For public business entities, the amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. The Company expects that the adoption of this ASU will not have a material impact on its financial statements.

In March 2020, the FASB issued ASU 2020-03, Codification Improvements to Financial Instruments, ("ASU 2020-03"). ASU 2020-03 improves various financial instruments topics, including the CECL Standard. ASU 2020-03 includes seven different issues that describe the areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating inconsistencies and providing clarifications. The amendments related to Issue 1, Issue 2, Issue 4, and Issue 5 were effective upon issuance of ASU 2020-03. The amendments related to Issue 3, Issue 6, and Issue 7 were effective for the Company beginning on January 1, 2020. The Company adopted this ASU on July 1, 2020 and the adoption of this ASU did not have a material impact on its financial statements.

In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform. The amendments in this standard can be applied anytime between the first quarter of 2020 and the fourth quarter of 2022. The Company is currently in the process of evaluating the impact of adoption of the new rules on the Company's financial condition, results of operations, cash flows, and disclosures.

The Company believes that other recent accounting pronouncement updates will not have a material effect on the Company's consolidated financial statements.

NOTE 3 - INVENTORIES, NET

The inventories, net consisted of the following:

	June 30, 2021			June 30, 2020

Raw materials	$	208,253			$	958,206
Work-in-process		1,232,787				529,655
Finished goods		1,512,884				1,433,423
Less: inventory reserve		(1,349,288	)			(1,121,408	)
Total inventories, net		1,604,636				1,799,876
Less: inventories, net, held for discontinued operations		281,245				1,100,391
Inventories, net, held for continuing operations	$	1,323,391			$	699,485

Work-in-process includes direct costs such as seed selection, fertilizer, labor cost, and subcontractor fees that are spent in growing agricultural products on the leased farmland, and indirect costs which include amortization of the prepayment of the farmland lease fees and farmland development costs. All the costs are accumulated until the time of harvest and then allocated to harvested crop costs when they are sold.

F-18

NOTE 4 - PROPERTY AND EQUIPMENT, NET

Property and equipment, net consisted of the following:

	June 30, 2021			June 30, 2020

Buildings	$	8,242,357			$	11,525,458
Machinery and equipment		688,979				860,610
Motor vehicles		63,090				57,630
Office equipment		243,543				231,174
Farmland leasehold improvements		3,256,339				2,974,508
		12,494,308				15,649,380
Less: accumulated depreciation and amortization		(6,556,839	)			(6,159,896	)
Total property and equipment, net		5,937,469				9,489,484
Less: property and equipment, net, held for discontinued operations		3,683,525				7,057,554
Property and equipment, net held for continuing operations	$	2,253,944			$	2,431,930

Depreciation and amortization expense charged to the continuing operations was US$255,255and US$453,344for the years ended June 30, 2021 and 2020, respectively. Depreciation and amortization expense charged to the discontinued operations was US$260,317and US$295,739for the years ended June 30, 2021 and 2020, respectively.

Farmland leasehold improvements consisted of following:

	June 30, 2021		June 30, 2020

Blueberry farmland leasehold improvements	$	2,501,664		$	2,285,149
Yew tree planting base reconstruction		280,279			256,021
Greenhouse renovation		474,396			433,338
Total farmland leasehold improvements		3,256,339			2,974,508
Less: farmland leasehold improvement, held for discontinued operations		-			-
Total farmland leasehold improvement, held for continuing operations	$	3,256,339		$	2,974,508

NOTE 5 - LAND USE RIGHTS, NET

Land use rights are recognized at cost less accumulated amortization. According to the Chinese laws and regulations regarding land use rights, land in urban districts is owned by the state, while land in the rural areas and suburban areas, except otherwise provided for by the state, is collectively owned by individuals designated as resident farmers by the state. However, in accordance with the legal principle that land ownership is separate from the right to the use of the land, the government grants the user a "land use right" to use the land. The Company has the land use right to use the land for 50years and amortizes the rights on a straight-line basis over the period of 50years.

	June 30, 2021			June 30, 2020

Land use rights	$	1,722,396			$	1,573,325
Less: accumulated amortization		(448,134	)			(377,382	)
Total land use rights, net		1,274,262				1,195,943
Less: land use rights, net, held for discontinued operations		1,274,262				1,195,943
Land use rights, net, held for continuing operations	$	-			$	-

For the years ended June 30, 2021 and 2020, amortization expenses from the continuing operations were both US$ nil. For the years ended June 30, 2021 and 2020, the Company recognized amortization expenses from the discontinued operations of US$39,592and US$36,876, respectively.

The estimated future amortization expenses are as follows:

12 months ending June 30:
2022	$	34,448
2023		34,448
2024		34,448
2025		34,448
2026		34,448
Thereafter		1,102,022
Total	$	1,274,262

F-19

NOTE 6 - DISTRIBUTION RIGHTS

The Company acquired distribution rights to distribute branded products of Daiso 100-yen shops through the acquisition of Tianjin Tajite. As this distribution right is difficult to acquire and will contribute significant revenue to Tianjin Tajite, such distribution rights were identified and valued as an intangible asset in the acquisition of Tianjin Tajite. The distribution rights, which have no expiration date, have been determined to have an indefinite life. Since the distribution rights have an indefinite life, the Company will evaluate them for impairment at least annually or earlier if determined necessary. As of June 30, 2021, the distribution rights from continuing operations were evaluated at RMB7,380,000(US$1,142,794).

NOTE 7 - INVESTMENTS

In 2013, Ankang Longevity Group entered into two equity investment agreements with Shaanxi Pharmaceutical Group Pai'ang Medicine Co. Ltd. ("Shaanxi Pharmaceutical Group"), a Chinese state-owned pharmaceutical enterprise, to invest a total of RMB6.8million (approximately US$1.0million) for a 49% equity interest in a pharmacy retail company called Shaanxi Pharmaceutical Sunsimiao Drugstores Ankang Retail Chain Co., Ltd. ("Sunsimiao Drugstores"), and a 49% equity interest in a pharmaceutical wholesale distribution company named Shaanxi Pharmaceutical Holding Group Longevity Pharmacy Co., Ltd. ("Shaanxi Longevity Pharmacy"). These two entities were incorporated to collaborate with Shaanxi Pharmaceutical Group to expand sales to regional hospitals and clinics and to establish the presence of retail pharmacies under the brand name "Sunsimiao." The investments were accounted for using the equity method because Ankang Longevity Group has significant influence, but no control of these two entities. The Company's discontinued operations, Ankang Longevity Group recorded a loss of US$3,784,000and an income of US$106,657for the years ended June 30, 2021 and 2020, respectively, from the investments, which was included in "Income (loss) from discontinued operations, net of taxes" in the consolidated statements of loss and comprehensive loss. (See Note 11.) On March 5, 2021, Ankang Longevity Group entered into two equity investment transfer agreements with a third-party company to sell all of its 49% equity interest in Sunsimiao Drugstores and its 49% equity interest in Shaanxi Longevity Pharmacy for a total consideration of RMB6.86million (approximately US$1.0million), and the full amount had been received by March 31, 2021. Upon the transfer of these two equity investments, Ankang Longevity Group recorded a loss of US$1,762,770, which was included in the Income (loss) from discontinued operations, net of taxes for the year ended June 30, 2021 as mentioned above.

In 2013, Ankang Longevity Group entered into a supplemental agreement with Shaanxi Pharmaceutical Group. According to the supplemental agreement, new 49% equity investment companies established by Shaanxi Pharmaceutical Group and Ankang Longevity Group are required to exclusively purchase certain raw materials and drug products from Shaanxi Pharmaceutical Group. In return, Shaanxi Pharmaceutical Group has agreed to compensate Ankang Longevity Group with a purchase rebate of 7% of the total purchases made from Shaanxi Pharmaceutical Group. For the years ended June 30, 2021 and 2020, noincome was recognized by Ankang Longevity Group from this supplemental agreement in addition to its 49% share of the income from the equity investment companies.

On October 21, 2013, the Company, through its controlled subsidiaries, Zhisheng Freight and Zhisheng Agricultural, entered into an agreement with an unrelated third party, Zhejiang Zhen'Ai Network Warehousing Services Co., Ltd. ("Zhen'Ai Network"), and invested RMB14.5million (approximately US$ 2.2million) into Tiancang Systematic Warehousing project ("Tiancang Project") operated by Zhen'Ai Network. The Tiancang Project is an online platform established to provide comprehensive warehousing and logistic solutions to companies involved in E-commerce. The Company is entitled to 29% of Tiancang Project's after-tax net income annually, less 30% statutory reserve and a 10% employee welfare fund contribution. When the amount of the accumulated statutory reserve reaches 30% of the total investment for the Tiancang Project, no additional appropriation to the statutory reserve is required. The Company considered it unlikely to obtain any investment income in the future, and decided the make a full impairment on this investment during the year ended June 30, 2020.

F-20

The Company's investments in unconsolidated entities consist of the following:

	June 30, 2021		June 30, 2020

Shaanxi Pharmaceutical Holding Group Longevity Pharmacy Co., Ltd.	$	-		$	3,690,419
Shaanxi Pharmaceutical Sunsimiao Drugstores Ankang Chain Co., Ltd.		-			824,705
Total investment		-			4,515,124
Less: investment, held for discontinued operations		-			4,515,124
Investment, held for continuing operations	$	-		$	-

Summarized financial information of unconsolidated entities from discontinued operations is as follows:

	June 30, 2021		June 30, 2020

Current assets	$	-		$	38,546,879
Noncurrent assets		-			324,725
Current liabilities		-			29,671,104

	For the years ended June 30,
	2021			2020

Net sales	$	21,373,037			$	30,552,645
Gross profit		1,763,172				2,838,942
Income (loss) from operations		(4,099,079	)			207,934
Net income (loss)		(4,124,960	)			217,668

NOTE 8 - LEASES

Effective July 1, 2019, the Company adopted the new lease accounting standard using the optional transition method, which allowed it to continue to apply the guidance under the lease standard in effect at the time in the comparative periods presented. In addition, the Company elected the package of practical expedients, which allowed it to not reassess whether any existing contracts contain a lease, to not reassess historical lease classification as operating or finance leases, and to not reassess initial direct costs. The Company has not elected the practical expedient to use hindsight to determine the lease term for its leases at transition. The Company has also elected the practical expedient, allowing it to not separate the lease and non-lease components for all classes of underlying assets. Adoption of this standard resulted in the recording of operating lease ROU assets and corresponding operating lease liabilities of $3,587,788and $450,123, respectively, as of July 1, 2019 with no impact on accumulated deficit. Financial position for reporting periods beginning on or after July 1, 2019, are presented under the new guidance, while prior-period amounts are not adjusted and continue to be reported in accordance with previous guidance.

The Company leases offices space under non-cancelable operating leases, with terms ranging from one to six years. In addition, the Zhisheng VIEs entered into several farmland lease contracts with farmer cooperatives to lease farmland in order to plant and grow organic vegetables, fruit, and Chinese yew trees. The lease terms vary from five yearsto 24years. The Company considers those renewal or termination options that are reasonably certain to be exercised in the determination of the lease term and initial measurement of ROU assets and lease liabilities. Lease expenses for lease payment are recognized on a straight-line basis over the lease term. Leases with initial terms of 12 months or less are not recorded on the balance sheet.

When available, the Company uses the rate implicit in the lease to discount lease payments to present value; however, most of the Company's leases do not provide a readily determinable implicit rate. Therefore, the Company discounts lease payments based on an estimate of its incremental borrowing rate.

F-21

The Company's lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The table below presents the operating lease related assets and liabilities from the continuing operations recorded on the balance sheets. No operating lease related assets and liabilities from the discontinued operations.

	June 30, 2021		June 30, 2020

ROU lease assets	$	3,585,703		$	3,227,895

Operating lease liabilities - current		434,411			97,633
Operating lease liabilities - non-current		352,863			401,891
Total operating lease liabilities	$	787,274		$	499,524

The weighted average remaining lease terms and discount rates for all of operating leases were as follows as of June 30, 2021 and 2020:

	June 30, 2021			June 30, 2020

Remaining lease term and discount rate:
Weighted average remaining lease term (years)		7.25			9.26
Weighted average discount rate		5.00	%		5.0

Rent expenses totaled US$641,486and US$801,191from the continuing operations for the years ended June 30, 2021 and 2020, respectively. Rent expenses were both US$ nilfrom the discontinued operations for the years ended June 30, 2021 and 2020, respectively.

The following is a schedule, by years, of maturities of lease liabilities as of June 30, 2021:

2022	$	709,542
2023		633,041
2024		353,938
2025		353,938
2026		333,493
Thereafter		1,273,773
Total lease payments		3,657,725
Less: imputed interest		(72,022	)
Less: prepayments		(2,798,429	)
Present value of lease liabilities	$	787,274

F-22

NOTE 9 - SHORT-TERM LOANS

Short-term loans consisted of the following:

Lender	June 30, 2021		Maturity Date		Int. Rate/Year
Agricultural Bank of China-a⁽¹⁾		1,548,502		2022/2/27		5.66	%
Agricultural Bank of China-b#		309,700		2022/9/1		5.66	%
Total short-term loans		1,858,202
Less: short-term loans, held for discontinued operations		1,858,202
Short-term loans, held for continuing operations	$	-

Lender	June 30, 2020		Maturity Date		Int. Rate/Year
Agricultural Bank of China-b*	$	282,896		2020-8-22		5.60	%
Agricultural Bank of China-a*		636,517		2020-12-23		4.65	%
Agricultural Bank of China-a		1,414,481		2021-2-24		5.66	%
Total short-term loans		2,333,894
Less: short-term loans, held for discontinued operations		2,333,894
Short-term loans, held for continuing operations	$	-

The loans outstanding were guaranteed by the following properties, entities or individuals:

a.	Guaranteed by a commercial credit guaranty company unrelated to the Company and also by Jiping Chen, a stockholder of the Company.

b.	Collateralized by the building owned by Xiaoyan Chen and Jing Chen, who are both related parties of the Company. Xiaoyan Chen is one of the shareholders of Ankang Longevity Group. Jing Chen is the sister of Xiaoyan Chen but not a shareholder of Ankang Longevity Group.

*	The Company repaid the loan in full on maturity date.

⁽¹⁾	Upon the original maturity date of February 27, 2021, the Company signed a loan extension agreement with Agricultural Bank of Chin to extend the loan repayment date to February 27, 2022 with the same interest rate of 5.66% per annum.

#	Upon the original maturity date of September 1, 2021, the Company signed a loan extension agreement with Agricultural Bank of Chin to extend the loan repayment date to September 1, 2022 with the same interest rate of 5.66% per annum.

Interest expenses from continuing operations were both US$ nil for the years ended June 30, 2021 and 2020, respectively. The Company recorded interest expenses from discontinued operations of US$115,806and US$116,438for the years ended June 30, 2021 and 2020, respectively. The annual weighted average interest rates from discontinued operations were 5.44% and 5.14% for the years ended June 30 2021 and 2020, respectively.

NOTE 10 - ACQUISITION

On December 12, 2016, the Company entered into a merger and acquisition agreement with Tianjin Tajite, a professional e-commerce company distributing Luobuma fabric commodities and branded products of Daiso 100-yen shops, based in Tianjin, China, to acquire 51% equity interests in Tianjin Tajite.

Pursuant to the agreement, the Company made a payment of RMB14,000,000(approximately US$2.1million) at the end of December 2016 as the total consideration for the acquisition of Tianjin Tajite.

On October 26, 2017, the Company completed the acquisition of Tianjin Tajite. The acquisition provides a unique opportunity for the Company to enter the market of Luobuma fabric commodities and branded products of Daiso 100-yen shops.

The transaction was accounted for in accordance with the provisions of ASC 805-10, Business Combinations. The Company retained independent appraisers to advise management in the determination of the fair value of the various assets acquired and liabilities assumed. The values assigned in these financial statements represents management's best estimate of fair values as of the acquisition date.

As required by ASC 805-20, Business Combinations-Identifiable Assets and Liabilities, and Any Noncontrolling Interest, management conducted a review to reassess whether they identified all the assets acquired and all the liabilities assumed, and followed ASC 805-20's measurement procedures for recognition of the fair value of net assets acquired.

F-23

The excess of the purchase price over the aggregate fair value of assets acquired was allocated to goodwill which amounted to RMB14,010,195(approximately US$2.1million). The results of operations of Tianjin Tajite have been included in the consolidated statements of operations from the date of acquisition.

In June 2018, the management performed evaluation on the impairment of goodwill. Due to the lower than expected revenue and profit, and unfavorable business environment, the management fully recorded an impairment loss on goodwill of Tianjin Tajite.

The fair value of distribution rights and its estimated useful lives from continuing operations are as follows:

Preliminary

Fair Value

Weighted Average

Useful Life

(in Years)

Distribution rights

1,142,794

(a)

(a)	The distribution rights with no expiration date has been determined to have an indefinite life.

Under ASC 805-10, acquisition-related costs (i.e., advisory, legal, valuation, and other professional fees) are not included as a component of consideration transferred, but are expensed in the periods in which the costs are incurred. Acquisition-related costs were US$ nilin the year ended June 30, 2021.

NOTE 11 - RELATED PARTY TRANSACTIONS

Due from Related Parties

The Company has made temporary advances to certain stockholders of the Company and to other entities that are either owned by family members of those stockholders or to other entities that the Company has investments in. Those advances are due on demand and non-interest bearing.

As of June 30, 2021 and 2020, the outstanding amounts due from related parties consisted of the following:

	June 30, 2021		June 30, 2020

Yang Bin	$	46,454		$	42,434
Beijing Huiyinansheng Asset Management Co., Ltd (a.)		23,228			21,217
Wang Qiwei		62,716			57,288
Total due from related parties		132,398			120,939
Less: due from related parties, held for discontinued operations		-			-
Due from related parties, held for continuing operations	$	132,398		$	120,939

a.	This company is wholly owned by one of the Company's senior managements.

Due to Related Parties

As of June 30, 2021 and 2020, the Company had related party payables of US$1,159,407and US$1,355,919, respectively, mainly due to the principal stockholders or certain relatives of the stockholders of the Company who lend funds for the Company's operations. The payables are unsecured, non-interest bearing, and due on demand.

	June 30, 2021		June 30, 2020

Wu Yang	$	99,183		$	90,598
Wang Sai		91,433			90,629
Chen Jiping		-			3,024
Zhou Guocong		551,314			648,308
Li Baolin		232,275			353,619
Zhao Min		185,202			169,741
Total due to related parties		1,159,407			1,355,919
Less: due to related parties, held for discontinued operations		-			-
Due to related parties, held for continuing operations	$	1,159,407		$	1,355,919

F-24

Sales to Related Parties

For the years ended June 30, 2021 and 2020, no sales to related parties or balance of accounts receivables were from continuing operations. The Company recorded sales to Shaanxi Pharmaceutical Group from the discontinued operations, a related party (see Note 7), of US$1,892,410and US$2,990,910, respectively. As of June 30, 2021 and 2020, the balance of accounts receivable due from Shaanxi Pharmaceutical Group from discontinued operations was US$551,237and US$1,567,160, respectively.

NOTE 12 - CONVERTIBLE NOTES PAYABLE

On June 16, 2021, the Company entered into a Securities Purchase Agreement pursuant to which the Company issued an unsecured convertible promissory note with a one-year maturity("the Note") to an institutional accredited investor Streeterville Capital, LLC ("Investor"). The Note has the original principal amount of US$3,170,000and Investor gave consideration of US$3.0million, reflecting original issue discount of US$150,000and Investor's legal fee of US$20,000. Interest accrues on the outstanding balance of the Note at 6% per annum. The Investor may redeem all or any part of the outstanding balance of the Note, at any time after six months from the issue date upon three trading days' notice, in cash or converting into shares of the Company's common stock at a price equal to 80% multiplied by the lowest daily volume weighted average price ("VWAP") during the fifteen trading days immediately preceding the applicable redemption conversion, subject to certain adjustments and ownership limitations specified in the Note. Following the receipt of a redemption notice, the Company may either ratify Investor's proposed allocation in the applicable redemption notice or elect to change the allocation by written notice to Investor within twenty-four (24) hours of its receipt of such redemption notice, so long as the sum of the cash payments and the amount of redemption conversions equal the applicable redemption amount. The Company anticipates using the proceeds for general working capital purposes.

As of June 30, 2021, the Company received principal in full from the Investor. The net convertible notes payable amounted to US$2,933,030(carrying value of US$3,170,000, net of deferred financing costs of US$236,970), and the conversion feature of US$66,970was recorded as additional paid-in capital as reflected in the accompanying consolidated balance sheets.

NOTE 13 - TAXES

(a) Corporate Income Taxes

The Company is subject to income taxes on an entity basis on income arising in or derived from the location in which each entity is domiciled.

Shineco is incorporated in the United States and has no operating activities. Tenet-Jove and its VIEs are governed by the Income Tax Laws of the PRC, and are currently subject to tax at a statutory rate of 25% on taxable income. Two VIEs and Xinjiang Taihe receive a full income tax exemption from the local tax authority of the PRC as agricultural enterprises as long as the favorable tax policy remains unchanged.

On December 22, 2017, The Act was enacted. The Act imposes a one-time transition tax on deemed repatriation of historical earnings of foreign subsidiaries, and future foreign earnings are subject to U.S. taxation. The change in rate has caused the Company to re-measure its income tax liability and record an estimated income tax expense of US$744,766for the year ended June 30, 2018. In accordance with SAB 118, additional work is necessary to do a more detailed analysis of The Act as well as potential correlative adjustments. Any subsequent adjustment to these amounts will be recorded to current tax expense in fiscal 2019 when the analysis is complete. The Company elects to pay the transition tax over an eight-year period using specified percentages (eight percent per year for the first five years, 15 percent in year six, 20 percent in year seven, and 25 percent in year eight).

F-25

i) The components of the income tax expenses were as follows:

	For the years ended June 30,
	2021		2020
Current income tax provision	$	43,701		$	673,562
Deferred income tax provision		-			416,834
Total income tax expenses		43,701			1,090,396
Less: income tax expenses, held for discontinued operations		43,701			845,920
Income tax expenses, held for continuing operations	$	-		$	244,476

	June 30, 2021			June 30, 2020
Deferred tax assets:
Allowance for doubtful accounts	$	951,136			$	428,879
Inventory reserve		306,308				252,022
Net operating loss carry-forwards		552,579				504,754
Total		1,810,023				1,185,655
Valuation allowance		(1,810,023	)			(1,185,655	)
Total deferred tax assets		-				-
Deferred tax liability:
Distribution rights		(285,699	)			(260,972	)
Total deferred tax liability		(285,699	)			(260,972	)
Deferred tax liability, net		(285,699	)			(260,972	)
Less: deferred tax liability, net, held for discontinued operations		-				-
Deferred tax liability, net, held for continuing operations	$	(285,699	)		$	(260,972	)

Movement of the valuation allowance:

	June 30, 2021			June 30, 2020

Beginning balance	$	1,185,655			$	519,671
Current year addition		512,028				680,901
Exchange difference		112,340				(14,917	)
Ending balance		1,810,023				1,185,655
Less: valuation allowance, held for discontinued operations		(1,362,329	)			(384,350	)
Valuation allowance, held for continuing operations	$	447,693			$	801,305

(b) Value-Added Tax

The Company is subject to a VAT for selling merchandise. The applicable VAT rate was 17% before May 1, 2018 for products sold in the PRC and decreased to 16% thereafter, and after April 1, 2019, the tax rate was further reduced to 13% based on the new Chinese tax law. The amount of VAT liability is determined by applying the applicable tax rate to the invoiced amount of goods sold (output VAT) less VAT paid on purchases made with the relevant supporting invoices (input VAT). Under commercial practice in the PRC, the Company pays VAT based on tax invoices issued. The tax invoices may be issued subsequent to the date on which revenue is recognized, and there may be a considerable delay between the date on which the revenue is recognized and the date on which the tax invoice is issued.

In the event that the PRC tax authorities dispute the date on which revenue is recognized for tax purposes, the PRC tax office has the right to assess a penalty based on the amount of the taxes which are determined to be late or deficient, and the penalty will be expensed in the period if and when a determination is made by the tax authorities. There were no assessed penalties during the years ended June 30, 2021 and 2020.

F-26

(c) Taxes Payable

Taxes payable consisted of the following:

	March 31, 2021			June 30, 2020

Income tax payable	$	3,376,499			$	3,424,043
Value added tax payable		73,390				522,615
Business tax and other taxes payable		8,573				6,026
Total tax payable		3,458,462				3,952,684
Less: tax payable, held for discontinued operations		(1,743,673	)			(1,918,829	)
Tax payable, held for continuing operations	$	1,714,789			$	2,033,855

Income tax payable - current portion	$	2,952,021			$	3,386,662
Less: income tax payable - current portion, held for discontinued operations		(1,743,673	)			(1,918,829	)
Income tax payable - current portion, held for continuing operations	$	1,208,348			$	1,467,833

Income tax payable - noncurrent portion	$	506,441			$	566,022
Less: income tax payable - noncurrent portion, held for discontinued operations		-				-
Income tax payable - noncurrent portion, held for continuing operations	$	506,441			$	566,022

NOTE 14 - STOCKHOLDERS' EQUITY

Initial Public Offering

On September 28, 2016, the Company completed its initial public offering of 190,354shares of common stock at a price of US$ 40.50per share for gross proceeds of US$ 7.7million and net proceeds of approximately US$5.4million. The Company's common shares began trading on September 28, 2016 on the NASDAQ Capital Market under the symbol "TYHT."

Statutory Reserve

The Company is required to make appropriations to reserve funds, comprising the statutory surplus reserve and discretionary surplus reserve, based on after-tax net income determined in accordance with generally accepted accounting principles of the PRC ("PRC GAAP").

Appropriations to the statutory surplus reserve are required to be at least 10% of the after-tax net income determined in accordance with PRC GAAP until the reserve is equal to 50% of the entities' registered capital. Appropriations to the discretionary surplus reserve are made at the discretion of the board of directors. As of June 30, 2021 and 2020, the balance of the required statutory reserves was US$4,198,107and US$4,198,107, respectively.

On September 3, 2019, the Company granted 184,763restricted shares of common stock to its employees as compensation cost for awards. The fair value of the restricted shares was US$1,022,660based on the closing stock price US$5.54at September 3, 2019. These restricted shares vested immediately on the grant date.

On September 5, 2019, the Company entered into a securities purchase agreement with select investors whereby the Company agreed to sell, and the investors agreed to purchase, up to310,977shares of common stock at a purchase price of US$4.68per Share. The Company received net proceeds of US$1,500,203. The offering was made pursuant to the Company's effective registration statement on Form S-3 (Registration Statement No. 333-221711) previously filed with the Securities and Exchange Commission and a prospectus supplement thereunder.

F-27

On July 10, 2020, the Company's stockholders approved a 1-for-9 reverse stock splitof the Company's common stock, par value $0.001per share, with a market effective date of August 14, 2020 (the "Reverse Stock Split"). As a result of the Reverse Stock Split, each nine pre-split shares of common stock outstanding automatically combined and converted to one issued and outstanding share of common stock without any action on the part of stockholders. No fractional shares of common stock were issued to any stockholders in connection with the Reverse Stock Split. Each stockholder was entitled to receive one share of common stock in lieu of the fractional share that would have resulted from the Reverse Stock Split. The number of the Company's authorized common stock remained at 100,000,000shares, and the par value of the common stock following the Reverse Stock Split remained at $0.001per share. As of August 14, 2020 (immediately prior to the effective date), there were 27,333,428shares of common stock outstanding, and the number of common stock outstanding after the Reverse Stock Split was 3,037,048, taking into account of the effect of rounding fractional shares into whole shares. As a result of the Reverse Stock Split, the Company's shares and per share data as reflected in the unaudited condensed consolidated financial statements were retroactively restated as if the transaction occurred at the beginning of the periods presented.

On December 10, 2020, the Company entered into a securities purchase agreement with select investors whereby the Company agreed to sell, and the investors agreed to purchase, up to604,900shares of common stock at a purchase price of US$2.73per share. The Company received net proceeds of US$1,643,087. The offering was made pursuant to the Company's effective registration statement on Form S-3 (Registration Statement No. 333-221711) previously filed with the Securities and Exchange Commission and a prospectus supplement thereunder.

On January 27, 2021, the Company issued 364,445shares of common stock to three investors at a price of US$3.0per share. The Company received net proceeds of US$1,093,355.

On April 14, 2021, the Company entered into certain stock purchase agreements (the "SPAs") with certain investors (the "Purchasers"), pursuant to which the Company agreed to sell, and the Purchasers agreed to purchase, severally and not jointly, an aggregate of 3,872,194shares of common stock of the Company (the "Shares") in an aggregate amount of $11,005,204(the "Offering"). The closing for the sale of the Shares in the Offering was subject to certain closing conditions. As of June 30, 2021, the Company had received gross proceeds of $2,470,001from the sale of the Shares in the Offering and had not yet received the remaining balance of $8,535,203in connection with the Offering.

NOTE 15 - CONCENTRATIONS AND RISKS

The Company maintains principally all bank accounts in the PRC. The cash balance held in the PRC bank accounts from the continuing operations was US$16,333,102and US$21,991,266as of June 30, 2021 and 2020, respectively. The cash balance held in the PRC bank accounts from the discontinued operations was US$12,676,416and US$10,366,986as of June 30, 2021 and 2020, respectively.

During the years ended June 30, 2021 and 2020, almost 100% of the Company's assets were located in the PRC and 100% of the Company's revenues were derived from its subsidiaries and VIEs located in the PRC.

For the year ended June 30, 2021, four customers accounted for approximately 23%, 20%, 19% and 10% of the Company's total sales from the continuing operations, respectively. For the year ended June 30, 2021, six customers accounted for approximately 23%, 20%, 19%, 14%, 12% and 12% of the Company's total sales from the discontinued operations, respectively. At June 30, 2021, four customers accounted for approximately 72% of the Company's accounts receivable from the continuing operations, and five customers accounted for approximately 95% of the Company's accounts receivable from the discontinued operations.

F-28

For the year ended June 30, 2020, five customers accounted for approximately 21%, 20%, 19%, 14% and 13% of the Company's total sales from the continuing operations, respectively. For the year ended June 30, 2020, five customers accounted for approximately 27%,22%, 19%,12% and 11% of the Company's total sales from the discontinued operations, respectively. At June 30, 2020, four customers accounted for approximately 84% of the Company's accounts receivable from the continuing operations, and four customers accounted for approximately 88% of the Company's accounts receivable from the discontinued operations.

For the year ended June 30, 2021, one vendor accounted for approximately 95% of the Company's total purchases from the continuing operations, respectively. For the year ended June 30, 2021, six vendors accounted for approximately 24%, 19%, 17%, 15%, 13% and12% of the Company's total purchases from the discontinued operations, respectively.

For the year ended June 30, 2020, two vendors accounted for approximately 84% and 16% of the Company's total purchases from the continuing operations, respectively. For the year ended June 30, 2020, six vendors accounted for approximately 26%, 18%, 17%, 13%, 13% and13% of the Company's total purchases from the discontinued operations, respectively.

NOTE 16 - COMMITMENTS AND CONTINGENCIES

Legal Contingencies

On May 16, 2017, Bonwick Capital Partners, LLC (the "Plaintiff") commenced a lawsuit (Case No. 1:17-cv-03681-PGG) against the Company in the United States District Court for the Southern District of New York. Plaintiff alleged that the Company entered into an agreement with the Plaintiff, pursuant to which the Plaintiff was to provide the Company with financial advisory services in connection with the Company's initial public offering in the United States. The Plaintiff alleged that the Company breached the Agreement and seek money damages up to US$6million. In March 2021, the Company entered into a Settlement Agreement and Release with the Plaintiff, pursuant to which the Company paid the Plaintiff a total sum of US$ 47,500as settlement payment, and upon acceptance of the settlement payment from the Company, the Plaintiff waived, released, and forever discharged the Company from all past and future claims.

NOTE 17 - SEGMENT REPORTING

ASC 280, "Segment Reporting," establishes standards for reporting information about operating segments on a basis consistent with the Group's internal organizational management structure as well as information about geographical areas, business segments, and major customers in for details on the Group's business segments.

The Company's chief operating decision maker has been identified as the Chief Executive Officer who reviews the financial information of separate operating segments when making decisions about allocating resources and assessing performance of the Group. Based on management's assessment, the Company has determined that it has threeoperating segments according to its major products and locations as follows:

●	Developing, manufacturing, and distributing of specialized fabrics, textile products, and other by-products derived from an indigenous Chinese plant called Apocynum Venetum, commonly known as "Bluish Dogbane" or known in Chinese as "Luobuma" (referred to herein as Luobuma):

The operating companies of this segment, namely Tenet-Jove and Tenet Huatai, specialize in Luobuma growing, development and manufacturing of relevant products, as well as purchasing Luobuma raw materials processing.

This segment's operations are focused in the north region of Mainland China, mostly carried out in Beijing, Tianjin, and Xinjiang.

F-29

●	Processing and distributing of traditional Chinese medicinal herbal products as well as other pharmaceutical products ("Herbal products"):

The operating companies of this segment, namely AnKang Longevity Group and its subsidiaries, which are reclassified as discontinued operations, process more than 600 kinds of Chinese medicinal herbal products with an established domestic sales and distribution network.

Ankang Longevity Group is also engaged in the retail pharmacy business and the operating revenue, which is not material, is also included in this segment.

●	Planting, processing, and distributing of green and organic agricultural produce as well as growing and cultivating of Chinese Yew trees ("Other agricultural products"):

The operating companies of this segment, the Zhisheng VIEs, are engaged in the business of growing and distributing green and organic vegetables and fruits as well as providing logistics services for distributing agricultural products. This segment has been focusing its efforts on the growing and cultivating of Chinese yew trees (formally known as "taxus media"), a small evergreen tree whose branches can be used for the production of medications believed to be anti-cancer and the tree itself can be used as an ornamental indoor bonsai tree, which are known to have the effect of purifying air quality.

The operations of this segment are located in the East and North regions of Mainland China, mostly carried out in Shandong Province and in Beijing, where the Zhisheng VIEs have newly developed over 100 acres of modern greenhouses for cultivating yew trees and other plants.

The following table presents summarized information by segment for the year ended June 30, 2021:

	For the year ended June 30, 2021
	Continuing Operations			Discontinued Operations
	Luobuma			Other agricultural					Herbal
	products			products			Total		products		Total
Segment revenue	$	115,590			$	2,906,114		$	3,021,704		$	8,085,527		$	11,107,231
Cost of revenue and related business and sales tax		200,263				7,057,592			7,257,855			7,099,353			14,357,208
Gross profit (loss)		(84,673	)			(4,151,478	)		(4,236,151	)		986,174			(3,249,977	)
Gross profit (loss) %		(73.3	)%			(142.9	)%		(140.2	)%		12.2	%		(29.3	)%

The following table presents summarized information by segment for the year ended June 30, 2020:

	For the year ended June 30, 2020
	Continuing Operations			Discontinued Operations
	Luobuma			Other agricultural					Herbal
	products			products			Total		products		Total
Segment revenue	$	168,241			$	10,250,335		$	10,418,576		$	13,266,050		$	23,684,626
Cost of revenue and related business and sales tax		245,650				7,277,369			7,523,019			10,041,795			17,564,814
Gross profit (loss)		(77,409	)			2,972,966			2,895,557			3,224,255			6,119,812
Gross profit (loss) %		(46.0	)%			29.0	%		27.8	%		24.3	%		25.8	%

Total assets as of June 30, 2021 and 2020 were as follows:

	June 30, 2021			June 30, 2020

Luobuma products	$	3,849,675			$	2,836,450
Herbal products		32,766,151				43,855,815
Other agricultural products		24,702,773				32,396,346
Total assets		61,318,599				79,088,611
Less: total assets held for discontinued operations		(24,702,773	)			(32,394,426	)
Total assets, held for continuing operations	$	36,615,826			$	46,694,185

F-30

NOTE 18 - DISCONTINUED OPERATIONS

On August 16, 2021, Tenet-Jove completed the previously announced acquisition pursuant to the Restructuring Agreement dated June 8, 2021 (the "Restructuring Agreement") with the following parties:

	●	Ankang Longevity, a company incorporated under the laws of the People's Republic of China (the "PRC");

	●	Mr. Jiping Chen, who is a minority shareholder of the Company and holds 68.7% of the equity interests in Ankang Longevity, and Ms. Xiaoyan Chen, who holds 31.3% of the equity interests in Ankang Longevity (collectively, the "Ankang Shareholders");

	●	Yushe County Guangyuan Forest Development Co., Ltd., a company incorporated under the laws of the PRC ("Guangyuan"); and

	●	Mr. Baolin Li, who is a minority shareholder of the Company and holds 90% of the equity interests in Guangyuan, and Ms. Yufeng Zhang, who holds 10% of the equity interests in Guangyuan (collectively, the "Guangyuan Shareholders").

Pursuant to the terms of the Restructuring Agreement, (i) the Company transferred all of its rights and interests in Ankang Longevity to the Guangyuan Shareholders in exchange for the control of 100% of equity interests in Guangyuan, which composes of one group of similar identifiable assets; (ii) Tenet-Jove entered a Termination Agreement with Ankang Longevity and the Ankang Shareholders; (iii) as a consideration to the Restructuring Agreement and based on a valuation report on the equity interests of Guangyuan issued by an independent third party, Tenet-Jove relinquished all of its rights and interests in Ankang Longevity and transferred those rights and interests to the Guangyuan Shareholders; and (iv) Guangyuan and the Guangyuan Shareholders entered into a series of variable interest entity agreements with Tenet-Jove.

In accordance with ASU No. 2014-08, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, a disposal of a component of an entity or a group of components of an entity is required to be reported as discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on an entity's operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-1E to be classified as held for sale. When all of the criteria to be classified as held for sale are met, including management, having the authority to approve the action, commits to a plan to sell the entity, the major current assets, other assets, current liabilities, and noncurrent liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations, less applicable income taxes (benefit), shall be reported as a component of net income (loss) separate from the net income (loss) of continuing operations in accordance with ASC 205-20-45. The assets and liabilities of the entities of Ankang Longevity have been reclassified as "assets of discontinued operations" and "liabilities of discontinued operations" within current and non-current assets and liabilities, respectively, on the consolidated balance sheets as of June 30, 2021 and 2020. The results of operations of Ankang Longevity have been reclassified to "net income (loss) from discontinued operations" in the consolidated statements of loss and comprehensive loss for the years ended June 30, 2021 and 2020.

F-31

The carrying amount of the major classes of assets and liabilities of discontinued operations as of June 30, 2021 and 2020 consist of the following:

	June 30, 2021		June 30, 2020
Assets of discontinued operation:
Current assets:
Cash	$	12,681,483		$	10,371,673
Accounts receivables		3,473,057			5,950,135
Inventories, net		281,245			1,100,391
Advances to suppliers, net		700,348			2,127,659
Other current assets		2,523,609			-
Total current assets of discontinued operation		19,659,742			19,549,858

Property and equipment, net		3,683,525			7,057,554
Land use right, net of accumulated amortization		1,274,262			1,195,943
Investments		-			4,515,124
Long-term deposit and other noncurrent assets		85,244			75,947
Total assets of discontinued operation	$	24,702,773		$	32,394,426

Liabilities of discontinued operation:
Current liabilities:
Short-term loans	$	1,858,202		$	2,333,894
Accounts payable		46,948			42,967
Other payables and accrued expenses		1,218,111			2,463,431
Taxes payable		1,743,673			1,918,829
Total liabilities of discontinued operation	$	4,866,934		$	6,759,121

The summarized operating result of discontinued operations included in the Company's consolidated statements of operations consist of the following:

	For the Years Ended June 30,
	2021			2020

REVENUE	$	8,085,527			$	13,266,050

COST OF REVENUE
Cost of product and services		7,069,026				9,993,068
Business and sales related tax		30,327				48,727
Total cost of revenue		7,099,353				10,041,795

GROSS PROFIT		986,174				3,224,255

OPERATING EXPENSES
General and administrative expenses		5,456,786				1,536,861
Selling expenses		74,207				88,649
Total operating expenses		5,530,993				1,625,510

INCOME (LOSS) FROM OPERATIONS		(4,544,819	)			1,598,745

OTHER INCOME (EXPENSE)
Income (loss) from equity method investments		(3,784,000	)			106,657
Other expenses		(2,171,150	)			(71	)
Interest expense, net		(73,318	)			(91,475	)
Total other income (loss)		(6,028,468	)			15,111

INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES FROM DISCONTINUED OPERATIONS		(10,573,287	)			1,613,856

PROVISION FOR INCOME TAXES FROM DISCONTINUED OPERATIONS		43,701				845,920

NET INCOME (LOSS) FROM DISCONTINUED OPERATIONS		(10,616,988	)			767,936

Net income (loss) attributable to non-controlling interest		(578,900	)			166,365

NET INCOME (LOSS) FROM DISCONTINUED OPERATIONS ATTRIBUTABLE TO SHINECO, INC.		(10,038,088	)			601,571

F-32

NOTE 19 - SUBSEQUENT EVENTS

On July 16, 2021, the Company entered into a Securities Purchase Agreement (the "July Agreement") pursuant to which the Company issued two unsecured convertible promissory notes with a one-year maturity(the "Notes") to an institutional accredited investor Streeterville Capital, LLC ("Investor"). The first convertible promissory note ("Note #1") has the original principal amount of US$3,170,000.00and the Investor will give consideration of US$3.0million, reflecting original issue discount of US$150,000and Investor's legal fee of US$20,000. The second convertible promissory note ("Note #2") has the original principal amount of US$4,200,000.00and Investor will give consideration of US$4.0million, reflecting original issue discount of US$200,000. Interest accrues on the outstanding balance of the Notes at6% per annum. As the date of this report, the Company received principal in full from the Investor.

On August 19, 2021, the Company entered into a Securities Purchase Agreement (the "Agreement") pursuant to which the Company issued an unsecured convertible promissory note with a one-year maturity(the "Note") to an institutional accredited investor Streeterville Capital, LLC ("Investor"). The Note has the original principal amount of US$10,520,000.00and Investor gave consideration of US$10.0million, reflecting original issue discount of US$500,000and Investor's legal fee of US$20,000. Interest accrues on the outstanding balance of the Note at 6% per annum. As the date of this report, the Company received principal in full from the Investor.

For the above-mentioned convertible promissory notes issued in July and August, the Investor may redeem all or any part of the outstanding balance of the Notes, at any time after six months from the issue date upon three trading days' notice, in cash or converting into shares of the Company's common stock at a price equal to 80% multiplied by the lowest daily volume weighted average price ("VWAP") during the fifteen trading days immediately preceding the applicable redemption conversion, subject to certain adjustments and ownership limitations specified in the Notes. The Company anticipates using the proceeds for general working capital purposes.

These consolidated financial statements were approved by management and available for issuance on September XX, 2021, and the Company has evaluated subsequent events through this date. No subsequent events required adjustments to or disclosure in these consolidated financial statements.

F-33

Part IV

Item 15.

Exhibits and Financial Statement Schedules

EXHIBIT INDEX

The following documents are filed herewith:

Number		Exhibit
3.1†		Certificate of Incorporation of Shineco, Inc. (1)

3.2†		Amended and Restated Bylaws of Shineco, Inc.(1)

4.1†		Specimen Common Stock Share Certificate (3)

4.2†		2016 Share Incentive Plan (2)

10.1†		Exclusive Business Cooperation Agreement between Beijing Tenet-Jove Technological Development Co., Ltd. and Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.2†		Timely Reporting Agreement between Shineco Inc. and Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated July 3, 2014. (1)

10.3†		Equity Interest Pledge Agreement among Beijing Tenet Jove Technological Development Co., Ltd., Wang Qiwei, Wang Sai, Yin Weixing, Liu Yu, Zhou Qi, Yang Chunhong, and Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.4†		Exclusive Option Agreement among Beijing Tenet Jove Technological Development Co., Ltd., Wang Qiwei, Wang Sai, Yin Weixing, Liu Yu, Zhou Qi, Yang Chunhong (Shareholders from Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd.), and Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.5†		Power of Attorney by and between Yang Chunhong and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.6†		Power of Attorney by and between Yin Weixing and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.7†		Power of Attorney by and between Liu Yu and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.8†		Power of Attorney by and between Wang Qiwei and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.9†		Power of Attorney by and between Wang Sai and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.10†		Power of Attorney by and between Zhou Qi and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Shineco Zhisheng (Beijing) Bio-Technology Co., Ltd. dated February 24, 2014. (1)

10.11†		Exclusive Business Cooperation Agreement between Beijing Tenet-Jove Technological Development Co., Ltd. and Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.12†		Timely Reporting Agreement between Shineco Inc. and Yantai Zhisheng International Freight Forwarding Co., Ltd. dated July 3, 2014. (1)

10.13†		Equity Interest Pledge Agreement among Beijing Tenet-Jove Technological Development Co., Ltd., Wang Qiwei, Wang Sai, Yin Weixing, Zhang Weisheng, Zhou Qi, Yang Chunhong, and Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.14†		Exclusive Option Agreement among Beijing Tenet-Jove Technological Development Co., Ltd., Wang Qiwei, Wang Sai, Yin Weixing, Zhang Weisheng, Zhou Qi, Yang Chunhong, and Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.15†		Power of Attorney by and between Zhou Qi and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.16†		Power of Attorney by and between Zhang Weisheng and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.17†		Power of Attorney by and between Yang Chunhong and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.18†		Power of Attorney by and between Wang Qiwei and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.19†		Power of Attorney by and between Wang Sai and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.20†		Power of Attorney by and between Yin Weixing and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Freight Forwarding Co., Ltd. dated June 16, 2011. (1)

10.21†		Exclusive Business Cooperation Agreement between Beijing Tenet Jove Technological Development Co., Ltd. and Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.22†		Timely Reporting Agreement between Shineco Inc. and Yantai Zhisheng International Trade Co., Ltd. dated July 3, 2014. (1)

10.23†		Equity Interest Pledge Agreement among Beijing Tenet Jove Technological Development Co., Ltd., Wang Qiwei, Wang Sai, Yin Weixing, Zhang Weisheng, Zhou Qi, Yang Chunhong, and Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.24†		Exclusive Option Agreement among Beijing Tenet Jove Technological Development Co., Ltd., Wang Qiwei, Wang Sai, Yin Weixing, Zhang Weisheng, Zhou Qi, Yang Chunhong, and Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.25†		Power of Attorney by and between Zhang Weisheng and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.26†		Power of Attorney by and between Zhou Qi and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.27†		Power of Attorney by and between Wang Qiwei and Beijing Tenet Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.28†		Power of Attorney by and between Yin Weixing and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.29†		Power of Attorney by and between Wang Sai and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.30†		Power of Attorney by and between Yang Chunhong and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Zhisheng International Trade Co., Ltd. dated June 16, 2011. (1)

10.31†		Exclusive Business Cooperation Agreement between Beijing Tenet-Jove Technological Development Co., Ltd. and Qingdao Zhihesheng Agricultural Produce Services, Co., Ltd. dated May 24, 2012. (1)

10.32†		Timely Reporting Agreement between Shineco Inc. and Qingdao Zhihesheng Agricultural Produce Services, Co., Ltd. dated July 3, 2014. (1)

10.33†		Equity Interest Pledge Agreement among Beijing Tenet-Jove Technological Development Co., Ltd., Wang Qiwei, Wang Sai, Yin Weixing, Zhang Weisheng, Zhou Qi, Yang Chunhong, and Qingdao Zhihesheng Agricultural Produce Services, Co., Ltd. dated May 24, 2012. (1)

10.34†		Exclusive Option Agreement among Beijing Tenet-Jove Technological Development Co., Ltd., Wang Qiwei, Wang Sai, Yin Weixing, Zhang Weisheng, Zhou Qi, Yang Chunhong, and Qingdao Zhihesheng Agricultural Produce Services, Co., Ltd. dated May 24, 2012. (1)

10.35†		Power of Attorney by and between Wang Sai and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Qingdao Zhihesheng Agricultural Produce Services Co., Ltd. dated May 24, 2012. (1)

10.36†		Power of Attorney by and between Wang Qiwei and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Qingdao Zhihesheng Agricultural Produce Services Co., Ltd. dated May 24, 2012. (1)

10.37†		Power of Attorney by and between Yin Weixing and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Qingdao Zhihesheng Agricultural Produce Services, Co., Ltd. dated May 24, 2012. (1)

10.38†		Power of Attorney by and between Zhang Weisheng and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Qingdao Zhihesheng Agricultural Produce Services, Co., Ltd. dated May 24, 2012. (1)

10.39†		Power of Attorney by and between Zhou Qi and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Qingdao Zhihesheng Agricultural Produce Services, Co., Ltd. dated May 24, 2012. (1)

10.40†		Power of Attorney by and between Yang Chunhong and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Qingdao Zhihesheng Agricultural Produce Services, Co., Ltd. dated May 24, 2012. (1)

10.41†		Exclusive Business Cooperation Agreement between Beijing Tenet-Jove Technological Development Co., Ltd. and Yantai Mouping District Zhisheng Agricultural Produce Cooperative dated June 16, 2011. (1)

10.42†		Timely Reporting Agreement between Shineco Inc. and Yantai Mouping District Zhisheng Agricultural Produce Cooperative dated July 3, 2014. (1)

10.43†		Guarantee Agreement among Beijing Tenet-Jove Technological Development Co., Ltd., Wang Qiwei, and Yantai Mouping District Zhisheng Agricultural Produce Cooperative dated June 16, 2011. (1)

10.44†		Power of Attorney by and between Zhang Weisheng and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Mouping District Zhisheng Agricultural Produce Cooperative dated June 16, 2011. (1)

10.45†		Power of Attorney by and between Yin Weixing and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Mouping District Zhisheng Agricultural Produce Cooperative dated June 16, 2011. (1)

10.46†		Power of Attorney by and between Wang Sai and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Mouping District Zhisheng Agricultural Produce Cooperative dated June 16, 2011. (1)

10.47†		Power of Attorney by and between Wang Qiwei and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Yantai Mouping District Zhisheng Agricultural Produce Cooperative dated June 16, 2011. (1)

10.48†		Exclusive Business Cooperation Agreement between Beijing Tenet-Jove Technological Development Co., Ltd. and Ankang Longevity Pharmaceutical (Group) Co., Ltd. dated December 31, 2008. (1)

10.49†		Timely Reporting Agreement between Shineco Inc. and Ankang Longevity Pharmaceutical (Group) Co., Ltd. dated July 3, 2014. (1)

10.50†		Equity Interest Pledge Agreement among Beijing Tenet-Jove Technological Development Co., Ltd., Chen Jiping, Chen Xiaoyan, and Ankang Longevity Pharmaceutical (Group) Co., Ltd. dated December 31, 2008. (1)

10.51†		Exclusive Option Agreement among Beijing Tenet-Jove Technological Development Co., Ltd., Chen Jiping, Chen Xiaoyan, and Ankang Longevity Pharmaceutical (Group) Co., Ltd. dated December 31, 2008. (1)

10.52†		Power of Attorney by and between Chen Xiaoyan and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Ankang Longevity Pharmaceutical (Group) Co., Ltd. dated December 31, 2008. (1)

10.53†		Power of Attorney by and between Chen Jiping and Beijing Tenet-Jove Technological Development Co., Ltd. regarding shareholding of Ankang Longevity Pharmaceutical (Group) Co., Ltd. dated December 31, 2008. (1)

10.54†		Summary translation of Cooperation Agreement between Shaanxi Pharmacy Sunsimiao Drugstore Chain Co., Ltd. and Ankang Longevity Pharmaceutical (Group) Co., Ltd. dated September 27, 2012. (1)

10.55†		Summary translation of Cooperation Agreement between Shaanxi Pharmacy Holding Group Xi'an Pharmaceutical Co., Ltd. and Ankang Longevity Pharmaceutical (Group) Co., Ltd. dated September 27, 2012. (1)

10.56†		Summary translation of Loan Contract between Beijing Tenet-Jove Technological Development Co., Ltd. and Beijing Rural Commercial Bank Co., Ltd. Tiantongyuan Branch dated December 31, 2009. (1)

10.57†		Summary translation of Project Shares Purchase Contract among Yantai Zhisheng International Freight Forwarding Co., Ltd., Yantai Mouping District Zhisheng Agricultural Produce Cooperative and Zhejiang Zhen'Ai Network Warehousing Services Co., Ltd. dated October 21, 2013. (1)

10.58†		Summary translation of Contractual Management/Operation Agreement between Ankang Longevity Pharmaceutical Group Chain Co., Ltd. and Qiu Haiyin dated March 1, 2013. (1)

10.59†		Summary translation of Supplementary Agreement between Ankang Longevity Pharmaceutical Group Chain Co., Ltd. and Qiu Haiyin dated February 28, 2014. (1)

10.60†		Form of Independent Director Engagement Letter (2)

10.61†		2016 Share Incentive Plan (included in Exhibit 4.2) (2)

10.62†		Translated Definitive Share Exchange and Acquisition Agreement between Xinjiang Taihe and Western Xinjiang Tiansheng Agricultural Development Co., Ltd., dated December 6, 2017 (Incorporated by reference to the Company's Form 8-K filed with the SEC on December 11, 2017)

10.63†		Common Stock Purchase Agreement between the Company and IFG Opportunity Fund LLC, dated January 23, 2018 (Incorporated by reference to the Company's Form 8-K filed with the SEC on January 26, 2018)

10.64†		Registration Rights Agreement between the Company and IFG Opportunity Fund LLC, dated January 23, 2018 (Incorporated by reference to the Company's Form 8-K filed with the SEC on January 26, 2018)

10.65†		Termination Agreement between the Company and IFG Opportunity Fund LLC, dated July 3, 2018 (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 5, 2018)

10.66†		Form of Securities Purchase Agreement among the Company and selected investors, dated September 27, 2018 (Incorporated by reference to the Company's Form 8-K filed with the SEC on September 28, 2018)

10.67†		Form of Securities Purchase Agreement dated December 10, 2020 (Incorporated by reference to the Company's Form 8-K filed with the SEC on December 15, 2020)

10.68†		Form of Stock Purchase Agreement by and between the Company and the Purchasers dated April 14, 2021 (Incorporated by reference to the Company's Form 8-K filed with the SEC on April 1, 2021)

10.69†		Employment Agreement dated May 6, 2021 by and between Shineco, Inc. and Ou Yang (Incorporated by reference to the Company's Form 8-K filed with the SEC on May 7, 2021)

10.70†		English translation of the Restructuring Agreement, dated June 8, 2021, by and among the Company, Tenet-Jove, Ankang Longevity, the Ankang Shareholders, Guangyuan, and the Guangyuan Shareholders

10.71†		Exclusive Business Cooperation Agreement, dated June 8, 2021, by and between Tenet-Jove and Guangyuan (Incorporated by reference to the Company's Form 8-K filed with the SEC on June 11, 2021)

10.72†		Equity Interest Pledge Agreement, dated June 8, 2021, by and among Tenet-Jove, Guangyuan, and the Guangyuan Shareholder (Baolin Li) (Incorporated by reference to the Company's Form 8-K filed with the SEC on June 11, 2021)

10.73†		Equity Interest Pledge Agreement, dated June 8, 2021, by and among Tenet-Jove, Guangyuan, and the Guangyuan Shareholder (Yufeng Zhang) (Incorporated by reference to the Company's Form 8-K filed with the SEC on June 11, 2021)

10.74†		Exclusive Option Agreement, dated June 8, 2021, by and among Tenet-Jove, Guangyuan, and the Guangyuan Shareholder (Baolin Li) (Incorporated by reference to the Company's Form 8-K filed with the SEC on June 11, 2021)

10.75†		Exclusive Option Agreement, dated June 8, 2021, by and among Tenet-Jove, Guangyuan, and the Guangyuan Shareholder (Yufeng Zhang) (Incorporated by reference to the Company's Form 8-K filed with the SEC on June 11, 2021)

10.76†		Power of Attorney, dated June 8, 2021, by and between the Guangyuan Shareholder (Baolin Li) and Tenet-Jove (Incorporated by reference to the Company's Form 8-K filed with the SEC on June 11, 2021)

10.77†		Power of Attorney, dated June 8, 2021, by and between the Guangyuan Shareholder (Yufeng Zhang) and Tenet-Jove (Incorporated by reference to the Company's Form 8-K filed with the SEC on June 11, 2021)

10.78†		English translation of the Termination Agreement, dated June 8, 2021, by and among Tenet-Jove, Ankang Longevity, and the Ankang Shareholders (Incorporated by reference to the Company's Form 8-K filed with the SEC on June 11, 2021)

10.79†		Director Offer Letter dated July 14, 2021 by and between Shineco, Inc. and Jennifer Zhan (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 15, 2021)

10.80†		Director Offer Letter dated July 14, 2021 by and between Shineco, Inc. and Mike Zhao (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 15, 2021)

10.81†		Employment Agreement dated July 15, 2021 by and between Shineco, Inc. and Jennifer Zhan (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 16, 2021)

10.82†		Convertible Promissory Note dated June 16, 2021 (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 21, 2021)

10.83†		Convertible Promissory Note #1 dated July 16, 2021 (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 21, 2021)

10.84†		Convertible Promissory Note #2 dated July 16, 2021 (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 21, 2021)

10.85†		Securities Purchase Agreement between Shineco, Inc. and Streeterville Capital, LLC dated June 16, 2021 (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 21, 2021)

10.86†		Securities Purchase Agreement between Shineco, Inc. and Streeterville Capital, LLC dated July 16, 2021 (Incorporated by reference to the Company's Form 8-K filed with the SEC on July 21, 2021)

10.87†		Convertible Promissory Note dated August 19, 2021 (Incorporated by reference to the Company's Form 8-K filed with the SEC on August 23, 2021)

10.88†		Securities Purchase Agreement between Shineco, Inc. and Streeterville Capital, LLC dated August 19, 2021 (Incorporated by reference to the Company's Form 8-K filed with the SEC on August 23, 2021)

10.89†		Offer Letter dated September 2, 2021, by and between the Company and Mr. Hu Li (Incorporated by reference to the Company's Form 8-K filed with the SEC on September 9, 2021)

14.1†		Code of Ethics of the Company. (2)

21.1		List of subsidiaries of the Company.(Incorporated by reference to the Annual report on Form 10-K for the fiscal year ended June 30, 2021 filed with the SEC on September 30, 2021)

23.1*		Consent of Independent Registered Public Accounting Firm

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

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

32.1*		Certifications of CEO and CFO pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS*		Inline XBRL Instance Document.

101.SCH*		Inline XBRL Taxonomy Extension Schema Document.

101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB*		Inline XBRL Taxonomy Extension Label Linkbase Document.

101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document.

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

*	Filed herewith.

†	Previously filed.

(1)	Incorporated by reference to the Company's Registration Statement on Form S-1 filed with the SEC on July 1, 2015 (Registration No. 333-202803).

(2)	Incorporated by reference to the Company's Annual Report on Form 10-K filed with the SEC September 28, 2016.

(3)	Incorporated by reference to the Company's Registration Statement on Form S-1 filed with the SEC on January 27, 2016 (Registration No. 333-202803).

SIGNATURES

Pursuant to the requirements of section 13 or 15 (d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Amendment to be signed on its behalf by the undersigned, thereunto duly authorized.

	SHINECO, INC. (Registrant)

Date: February 10, 2022	By:	/s/ Jennifer Zhan
		Jennifer Zhan
		Chief Executive Officer

Date: February 10, 2022	By:	/s/ Sai (Sam) Wang
		Sai (Sam) Wang
		Chief Financial Officer

Pursuant to the requirements of the Securities Act of 1933, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated:

Signature	Title	Date

/s/ Jennifer Zhan	Chief Executive Officer	February 10, 2022
Jennifer Zhan	(Principal Executive Officer)

/s/ Sai (Sam) Wang	Chief Financial Officer and Director	February 10, 2022
Sai (Sam) Wang	(Principal Accounting and Financial Officer)

/s/ Yuying Zhang	Director	February 10, 2022
Yuying Zhang

/s/ Jin Liu	Director	February 10, 2022
Jin Liu

/s/ Yanzeng An	Director	February 10, 2022
Yanzeng An

/s/ Hu Li	Director	February 10, 2022
Hu Li

/s/ Mike Zhao	Director	February 10, 2022
Mike Zhao

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Shineco Inc. published this content on 10 February 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 February 2022 22:00:27 UTC.

Market Closed - Nasdaq Other stock markets 04:30:01 2024-04-26 pm EDT			5-day change	1st Jan Change
0.81 ^USD	+1.25%		+17.05%	-28.06%

Mar. 13	Shineco Regains Compliance With Nasdaq Listing Rule	MT
Feb. 20	Top Premarket Gainers	MT

Shineco, Inc.

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US8245674085

Food Processing

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Company Profile

Income Statement Evolution

Sector Special Foods & Wellbeing Products

	1st Jan change	Capi.
SHINECO, INC.	-28.06%	5.19M
ZHEJIANG NHU COMPANY LTD.	+8.20%	7.78B
BELLRING BRANDS, INC.	+1.64%	7.38B
CSPC INNOVATION PHARMACEUTICAL CO., LTD.	+10.20%	6.52B
BYHEALTH CO., LTD	-8.10%	3.67B
XIAMEN KINGDOMWAY GROUP COMPANY	-14.57%	1.17B
SIRIO PHARMA CO., LTD.	+8.34%	934M
HERBALIFE LTD.	-42.27%	879M
USANA HEALTH SCIENCES, INC.	-18.90%	836M
JAMIESON WELLNESS INC.	-16.45%	802M