UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM ~~10-Q/A~~

(~~Amendment No. 1~~)10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, ~~2022~~2023

☐ 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 333-205835

~~TINGO,~~AGRI-FINTECH HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Nevada		83-0549737
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

~~43 West 23~~11650 South State^rd Street, Suite 240 Draper, 2^nd ~~Floor~~ ~~New York~~, NYUT		10010 (Zip Code)
(Address of principal executive offices)

TINGO, INC.

43 West 23^rd Street, 2^nd Floor, New York, NY 10010

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Registrant’s telephone number, including area code: (~~(646)~~385) ~~847- 0144~~463-8168

Securities registered pursuant to Section 12(b) of the Act: None.

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

Class A Common Stock, $0.001 par value per share

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 (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” 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 is a shell company. Yes ☐ No ☒

There were 1,227,516,211 shares of the registrant’s Class A common stock, $0.001 par value, outstanding, as of August ~~15, 2022.~~1, 2023.

Table of Contents

~~EXPLANATORY NOTE~~

~~In examining the revenue recognition policies for~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc. ~~(the “Company”~~), the Company has revised its accounting treatment of asset classifications and costs associated with the operating leases for its mobile phone devices. While this revision did not affect the Company’s gross revenue or net income for the periods presented, it did reallocate prepayments for the devices to property, plant, and equipment, and reallocated costs associated with the devices from cost of sales to depreciation expense.

In view of the changes noted above, this Amendment No. 1 to the Company’s Quarterly Report on Form 10-Q for the quarter and six months ended June 30, 2022 (“Amended 10-Q”) supersedes and replaces in its entirety the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 22, 2022 (“Original Filing”).

This Amended 10-Q does not reflect events occurring after the Original Filing except as noted above. Except for the information concerning the change in accounting treatment for the items described above, this Amended 10-Q continues to speak as of the date of the Original Filing and the Company has not otherwise updated disclosures contained therein or herein to reflect events that occurred at a later date.

~~Table of Contents~~

~~TINGO, INC.~~

(A Nevada Corporation)

INDEX


		Page
PART I. FINANCIAL INFORMATION
Item 1. Unaudited ~~Condensed~~ Financial Statements		3
Balance Sheets		3
Statements of Operations and Comprehensive Income (Sucessor Period and Consolidated for the Predecessor Period)		4
~~Condensed Consolidated Balance Sheets~~		4
~~Condensed Consolidated~~ Statements of ~~Comprehensive Income~~Shareholders’ Equity (Successor Period and Consolidated for the Predecessor Period)		5
~~Condensed Consolidated~~ Statements of ~~Shareholders’ Equity~~Cash Flows (Consolidated for the Predecessor Period)		6
~~Condensed Consolidated Statements of Cash Flows~~		97
Notes to ~~Condensed Consolidated~~ Financial Statements		108
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		2220
Item 3. Quantitative and Qualitative Disclosure about Market Risk		3125
Item 4. Controls and Procedures		3125
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		3226
Item 1A. Risk Factors		3226
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		3226
Item 3. Defaults Upon Senior Securities		3226
Item 4. Mine Safety Disclosures		3226
Item 5. Other Information		3226
Item 6. Exhibits		3327
SIGNATURE		3428

Table of Contents

Part I.Financial Information

Item 1. Unaudited ~~Condensed~~ Consolidated Financial Statements

~~TINGO,~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc.)

~~CONDENSED CONSOLIDATED~~ BALANCE SHEETS

(Unaudited)


	June 30,		December 31,		June 30,		December 31,
	2022		2021		2023		2022
Assets
Current Assets
Cash	$	104,137,120	$	128,367,605
Accounts receivable, net		318,743,740		364,308,399
Inventory		33,913		129,823
Cash and cash equivalents					$	13,568	$	985
Loans and other receivables – related parties						20,058,693		19,637,668
Total Current Assets		422,914,773		492,805,827		20,072,261		19,638,653

Non-Current Assets
Property, plant and equipment, net		984,922,420		1,198,883,019
Intangible assets, net		1,096,571		1,670,924
Total non-current assets		986,018,991		1,200,553,943
Investment in securities						1,215,241,000		1,215,241,000
Total Non-Current assets						1,215,241,000		1,215,241,000
Total Assets	$	1,408,933,764	$	1,693,359,770	$	1,235,313,261	$	1,234,879,653

Liabilities and Stockholders’ Equity
Current Liabilities
Accounts payable and accruals	$	101,328,836	$	755,885,193	$	6,460,967	$	4,286,181
Deferred income - current portion		298,262,348		221,215,018
Value added tax - current portion		23,340,039		17,162,192
Income tax payable		87,962,365		100,606,352
Advances from related party		89,216,821		—		465,000		505,000
Note payable - short term		3,049,945		—
Total current liabilities		603,160,354		1,094,868,755

Non-current liabilities
Deferred Tax		4,337,147		2,171,039
Total non- current liabilities		4,337,147		2,171,039
Notes payable – related parties						23,772,445		23,749,945
Settlement liability						7,700,000		—
Total Current Liabilities						38,938,412		28,541,126

Total Liabilities		607,497,501		1,097,039,794		38,398,412		28,541,126

Commitments and Contingencies

Stockholders’ Equity
Common stock - Class A, par value $.001 per share, 2,250,000,000 shares authorized, 1,227,516,211 and 1,205,016,211 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively		1,227,516		1,205,016
Common stock - Class B, par value $.001 per share, 200,000,000 shares authorized, 65,000,000 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively		65,000		65,000
Common stock - Class A, par value $.001 per share, 2,250,000,000 shares authorized, 1,227,516,211 shares issued and outstanding at June 30, 2023 and December 31, 2022						1,227,516		1,227,516
Common Stock - Class B, par value $.001 per share, 200,000,000 shares authorized, 65,000,000 shares issued and outstanding at June 30, 2023 and December 31, 2022						65,000		65,000
Additional paid-in-capital		419,181,135		330,703,635		419,181,135		419,181,135
Retained earnings		521,298,398		416,095,565		788,670,116		818,796,244
Deferred stock compensation		(53,633,818)		(66,357,804)		(12,228,918)		(32,931,368)
Translation reserve		(86,701,968)		(85,391,436)
Total Stockholders’ Equity		801,436,263		596,319,976		1,196,914,849		1,206,338,527
Total Liabilities and Stockholders’ Equity	$	1,408,933,764	$	1,693,359,770	$	1,235,223,261	$	1,234,879,653

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

Table of Contents

~~TINGO,~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc.)

~~CONDENSED CONSOLIDATED~~ STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(Successor Period and Consolidated for the Predecessor Period)

(Unaudited)


	For the three months ended		For the three months ended		For the six months ended		For the six months ended		Successor Period		Predecessor Period		Successor Period		Predecessor Period
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021		For the three months ended		For the three months ended		For the six months ended		For the six months ended
Revenues	$	268,684,899	$	100,731,394	$	525,742,418	$	145,969,519
Cost of Sales		(3,114,854)		(47,481,689)		(5,614,694)		(49,993,630)
									June 30, 2023		June 30, 2022		June 30, 2023		June 30, 2022
Revenue									$	—	$	268,684,899	$	—	$	525,742,418
Cost of revenue										—		(3,114,854)		—		(5,614,694)
Gross Profit		265,570,045		53,249,705		520,127,724		95,975,889		—		265,570,045		—		520,127,724

Operating expenses
Operating Expenses
Payroll and related expenses		20,329,684		773,918		39,570,896		1,464,614		10,927,330		20,329,684		21,950,792		39,570,896
Distribution expenses		288,774		6,245		509,961		110,818		—		288,774		—		509,961
Professional fees		12,821,414		307,681		68,490,826		623,115		279,085		12,821,414		579,084		68,490,826
Bank fees and charges		360,373		173,201		996,420		236,025		237		360,373		1,774		996,420
Depreciation and amortization		106,876,493		721,339		213,617,432		1,461,955		—		106,876,493		—		213,617,432
General and administrative expenses - other		2,869,859		260,346		3,708,772		449,513		14,826		2,869,859		7,752,555		3,708,772
Bad debt expenses		57		—		47,455		—		—		57		—		47,455
Total Operating Expenses		143,546,654		2,242,730		326,941,762		4,346,040		11,221,478		143,546,654		30,284,205		326,941,762

Income from Operations		122,023,391		51,006,975		193,185,962		91,629,849
Income (Loss) from Operations										(11,221,478)		122,023,391		(30,126,128)		193,185,962

Other Income (Expenses)
Other Income (Expense)
Other income		137,938		79,767		323,736		139,488		297,782		137,938		750,744		323,736
Interest expense		(23,726)		—		(23,726)		—		(298,831)		(23,726)		(592,667)		(23,726)
Total Other Income		114,212		79,767		300,010		139,488
Total Other Income (Expense)										(1,049)		114,212		158,077		300,010

Income before tax		122,137,603		51,086,742		193,485,972		91,769,337
Income (Loss) Before Tax										(11,222,527)		122,137,603		(30,126,128)		193,485,972

Taxation		(49,584,310)		(16,347,757)		(88,283,139)		(29,366,188)		—		(49,584,310)		—		(88,283,139)

Net Income	$	72,553,293	$	34,738,985	$	105,202,833	$	62,403,149
Net Income (Loss)									$	(11,222,527)	$	72,553,293	$	(30,126,128)	$	105,202,833

Other Comprehensive Income (loss)
Other Comprehensive Income (Loss)
Translation Adjustment		(970,419)		(22,507,442)		(1,310,532)		(33,316,682)		—		(970,419)		—		(1,310,532)

Total Comprehensive Income	$	71,582,874	$	12,231,543	$	103,892,301	$	29,086,467
Total Comprehensive Income (Loss)									$	(11,222,527)	$	71,582,874	$	(30,126,128)	$	103,892,301

Earnings per share - Basic and Diluted	$	0.06	$	0.01	$	0.09	$	0.03
Earnings Per Share - Basic and Diluted									$	(0.01)	$	0.06	$	(0.02)	$	0.09

Weighted Average number of common shares outstanding
Basic and diluted		1,221,262,021		1,028,000,000		1,221,082,509		1,028,000,000		1,227,516,221		1,227,516,211		1,221,262,021		1,221,082,509

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

Table of Contents

~~TINGO,~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc.)

~~CONDENSED CONSOLIDATED~~ STATEMENTS OF SHAREHOLDERS’ EQUITY (SUCCESSOR)

(Successor and Consolidated for the Predecessor Period)

(Unaudited)

(Continued on Next Page)

Six Months ~~ended~~Ended June 30, ~~2022~~2023

Common Stock - Class A

Common Stock - Class B

Additional Paid

Deferred Stock

Retained

Translation

Total Stockholders’


Number of Shares

Amount

Number of Shares

Amount

In Capital

Compensation

Earnings

Reserve

Equity
Balance as of January 1, 2022

1,205,016,211

$
1,205,016

65,000,000

$
65,000

$
330,703,635

$
(66,357,804)

$
416,095,565

$
(85,391,436)

$
596,319,976

Issuance of shares for incentive compensation plan – consultants

14,500,000

14,500

—

—

66,485,500

(66,500,000)

—

—

—

Issuance of shares for incentive compensation plan - employees

8,000,000

8,000

—

—

21,992,000

(22,000,000)

—

—

—

Vesting of deferred stock compensation

—

—

—

—

—

101,223,986

—

—

101,223,986

Net income for the six months ended June 30, 2022

—

—

—

—

—

—

105,202,833

—

105,202,833

Foreign Currency Translation Adjustment

—

—

—

—

—

—

(1,310,532)

(1,310,532)

Balances as of June 30, 2022

1,227,516,211

$
1,227,516

65,000,000

$
65,000

$
419,181,135

$
(53,633,818)

$
521,298,398

$
(86,701,968)

$
801,436,263


	Common Stock - Class A			Common Stock - Class B			Additional Paid		Deferred Stock		Retained		Translation		Total Stockholders’
	Number of Shares	Amount		Number of Shares	Amount		In Capital		Compensation		Earnings		Reserve		Equity
Balance as of December 31, 2022 (Successor)	1,227,516,211	$	1,227,516	65,000,000	$	65,000	$	419,181,135	$	(32,931,368)	$	818,796,244	$	—	$	1,206,338,527

Vesting of deferred stock compensation (Successor)	—		—	—		—		—		20,702,450		—		—		20,702,450

Net loss for the six months ended June 30, 2023 (Successor)	—		—	—		—		—		—		(30,126,128)		—		(301,256,128)

Balance as of June 30, 2023 (Successor)	1,227,516,211	$	1,227,516	65,000,000	$	65,000	$	419,181,135	$	(12,228,918)	$	788,670,116	$	—	$	1,196,914,849

~~Table of Contents~~

~~TINGO, INC.~~

~~CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY~~

~~(Unaudited)~~

~~(Continued from Previous Page)~~

Three Months ~~ended~~Ended June 30, ~~2022~~

Common Stock - Class A

Common Stock - Class B

Additional Paid

Deferred Stock

Retained

Translation

Total Stockholders’


Number of Shares

Amount

Number of Shares

Amount

In Capital

Compensation

Earnings

Reserve

Equity
Balance as of March 31, 2022

1,205,016,211

$
1,205,016

65,000,000

$
65,000

$
385,693,635

$
(49,318,303)

$
448,745,105

$
(85,731,549)

$
700,668,904

Issuance of shares for incentive compensation plan – consultants

4,500,000

4,500

—

—

11,495,500

11,500,000

—

—

—

Issuance of shares for incentive compensation plan - employees

8,000,000

8,000

—

—

21,992,000

(22,000,000)

—

—

—

Vesting of deferred stock compensation

—

—

—

—

—

29,184,485

—

—

29,184,485

Net income for the three months ended June 30, 2022

—

—

—

—

—

—

72,535,293

—

72,535,293

Foreign Currency Translation Adjustment

—

—

—

—

—

—

—

(970,419)

(970,419)

Balances as of June 30, 2022

1,227,516,211

$
1,227,516

65,000,000

$
65,000

$
419,181,135

$
(53,633,818)

$
521,280,398

$
(86,701,968)

$
801,436,263

~~Table of Contents~~

~~TINGO, INC.~~

~~CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY~~

~~(Unaudited)~~

~~(Continued from Previous Page)~~

~~Six Months ended June 30, 2021~~2023

Common Stock - Class A

Common Stock - Class B

Additional Paid

Retained

Translation

Total Stockholders’


Number of Shares

Amount

Number of Shares

Amount

In Capital

Earnings

Reserve

Equity
Balance as of January 1, 2021

1,028,000,000

$
1,028,000

65,000,000

$
65,000

$
508,549

$
458,438,770

$
(32,283,238)

$
427,757,081

Net income for the six months ended June 30, 2021

—

—

—

—

—

62,403,149

—

62,403,149

Foreign Currency Translation Adjustment

—

—

—

—

—

—

(33,316,682)

(33,316,682)

Balances as of June 30, 2021

1,028,000,000

$
1,028,000

65,000,000

$
65,000

$
508,549

$
520,841,919

$
(65,599,920)

$
456,843,548


	Common Stock - Class A			Common Stock - Class B			Additional Paid		Deferred Stock		Retained		Translation		Total Stockholders’
	Number of Shares	Amount		Number of Shares	Amount		In Capital		Compensation		Earnings		Reserve		Equity
Balance as of March 31, 2023 (Successor)	1,227,516,211	$	1,227,516	65,000,000	$	65,000	$	419,181,135	$	(22,580,143)	$	799,892,643	$	—	$	1,197,786,151

Vesting of deferred stock compensation (Successor)	—		—	—		—		—		10,351,225		—		—		10,351,225

Net loss for the three months ended June 30, 2023 (Successor)	—		—	—		—		—		—		(11,222,527)		—		(11,222,527)

Balance as of June 30, 2023 (Successor)	1,227,516,211	$	1,227,516	65,000,000	$	65,000	$	419,181,135	$	(12,228,918)	$	788,670,116	$	—	$	1,196,914,849

Table of Contents

~~Three~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc.)

STATEMENTS OF SHAREHOLDERS’ EQUITY (PREDECESSOR)

(Successor and Consolidated for the Predecessor Period)

(Unaudited)

(Continued from Previous Page)

Six Months ~~ended~~Ended June 30, ~~2021~~2022

Common Stock - Class A

Common Stock - Class B

Additional Paid

Retained

Translation

Total Stockholders’


Number of Shares

Amount

Number of Shares

Amount

In Capital

Earnings

Reserve

Equity
Balance as of March 31, 2021

1,028,000,000

$
1,028,000

65,000,000

$
65,000

$
508,549

$
486,102,934

$
(43,092,478)

$
444,612,005
Net income for the three months ended June 30, 2021

—

—

—

—

—

34,738,985

—

34,738,985
Foreign Currency Translation Adjustment

—

—

—

—

—

—

(22,507,442)

(22,507,442)
Balances as of June 30, 2021

1,028,000,000

$
1,028,000

65,000,000

$
65,000

$
508,549

$
520,841,919

$
(65,599,920)

$
456,843,548


	Common Stock - Class A			Common Stock - Class B			Additional Paid		Deferred Stock		Retained		Translation		Total Stockholders’
	Number of Shares	Amount		Number of Shares	Amount		In Capital		Compensation		Earnings		Reserve		Equity
Balance as of December 31, 2021 (Predecessor)	1,205,016,211	$	1,205,016	65,000,000	$	65,000	$	330,703,635	$	(66,357,804)	$	416,095,565	$	(85,391,436)	$	596,319,976

Issuance of shares for incentive compensation plan - consultants (Predecessor)	14,500,000		14,500	—		—		66,485,500		(66,500,000)		—		—		—

Issuance of shares for incentive compensation plan - employees (Predecessor)	8,000,000		8,000	—		—		21,992,000		(22,000,000)		—		—		—

Vesting of deferred stock compensation (Predecessor)	—		—	—		—		—		101,223,986		—		—		101,223,986

Net income for the six months ended June 30, 2022 (Predecessor)	—		—	—		—		—		—		105,202,833		—		105,202,833

Foreign Currency Translation Adjustment (Predecessor)	—		—	—		—		—		—		—		(1,310,532)		(1,310,532)

Balance as of June 30, 2022 (Predecessor)	1,227,516,211	$	1,227,516	65,000,000	$	65,000	$	419,181,135	$	(53,633,818)	$	521,298,398	$	(86,701,968)	$	801,436,263

Three Months Ended June 30, 2022


	Common Stock - Class A			Common Stock - Class B			Additional Paid		Deferred Stock		Retained		Translation		Total Stockholders’
	Number of Shares	Amount		Number of Shares	Amount		In Capital		Compensation		Earnings		Reserve		Equity
Balance as of March 31, 2022 (Predecessor)	1,215,016,211	$	1,215,016	65,000,000	$	65,000	$	385,693,635	$	(49,318,303)	$	448,745,105	$	(85,731,549)	$	700,668,904

Issuance of shares for incentive compensation plan - consultants (Predecessor)	4,500,000		4,500	—		—		11,495,500		(11,500,000)		—		—		—

Issuance of shares for incentive compensation plan - employees (Predecessor)	8,000,000		8,000	—		—		21,992,000		(22,000,000)		—		—		—

Vesting of deferred stock compensation (Predecessor)	—		—	—		—		—		29,184,485		—		—		29,184,485

Net income for the three months ended June 30, 2022 (Predecessor)	—		—	—		—		—		—		72,553,293		—		72,553,293

Foreign Currency Translation Adjustment (Predecessor)	—		—	—		—		—		—		—		(970,419)		(970,419)

Balance as of June 30, 2022 (Predecessor)	1,227,516,211	$	1,227,516	65,000,000	$	65,000	$	419,181,135	$	(53,633,818)	$	521,298,398	$	(86,701,968)	$	801,436,263

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

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~~TINGO,~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc.)

~~CONDENSED CONSOLIDATED~~ STATEMENTS OF CASH FLOWS

(Successor and Consolidated for the Predecessor Period)

(Unaudited)

For the Six months ended


June 30, 2022

June 30, 2021
Cash Flows from operating activities




Net Income

$
105,202,833

$
62,403,149
Adjustments to reconcile net income to cash (used in) provided by operating activities

Depreciation and amortization

213,617,432

1,461,954
Shares issued to outside parties

66,500,000

—
Shares issued under employee incentive plan

22,000,000

—
Deferred compensation

12,723,986

—
Increase/Decrease related to

Inventories

95,910

(194,696)
Trade and other receivables

45,564,659

(732,493,104)
Prepayments

—

(744,367,280)
Accounts payable and accruals

(654,556,357)

1,442,127,470
Deferred income

77,047,330

—
Value added tax

6,177,847

(20,493,802)
Income tax payable

(10,477,879)

23,221,668
Net Cash (used in) provided by operating activities

(116,104,239)

31,665,359

Cash Flows from financing activities

Proceeds from related party

89,216,821

—
Proceeds from notes payable

3,049,945

—
Net Cash provided by financing activities

92,266,766

—

Translation Adjustment

(393,012)

(15,362,143)

Net change in cash and cash equivalents

(24,230,485)

16,303,216

Cash and cash equivalents, beginning of the year

128,367,605

28,202,869

Cash and cash equivalents, end of the period

$
104,137,120

$
44,506,085

Supplemental Cash flow information

Cash paid for period for:

Income taxes

$
100,262,236

$
—
Interest

$
4,000

$
—

Non-cash disclosures

Shares issued under incentive plan - employees

$
22,000,000

$
—
Shares issued to outside parties for services

$
66,500,000

$
—


	Successor Period		Predecessor Period
	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022
Cash flows from operating activities:
Net income (loss)	$	(30,126,128)	$	105,202,833
Adjustments to reconcile net income (loss) to cash provided by (used in) operating activities:
Depreciation and amortization		—		213,617,432
Stock issued for services		—		66,500,000
Deferred compensation		20,702,450		12,723,986
Settlement expense		7,700,000		—
Increase/decrease related to:
Inventories		—		95,910
Trade and other receivables		—		45,564,659
Other current assets		(421,025)		—
Accounts payable and accruals		2,174,786		(654,556,357)
Deferred income		—		77,047,330
Value added tax		—		6,177,847
Taxes payable		—		(10,477,879)
Net cash provided by (used in) operating activities		30,083		(116,104,239)

Cash flows from financing activities:
Proceeds from related party		—		89,216,821
Proceeds from notes payable		22,500		3,049,945
Payments on advances from related party		(40,000)		—
Net cash provided by (used in) financing activities		(17,500)		92,266,766

Translation adjustment		—		(393,012)

Net change in cash and cash equivalents		12,583		(24,230,485)

Cash and cash equivalents, beginning of the period		985		128,367,605

Cash and cash equivalents, end of the period	$	13,568	$	104,137,120

Supplemental Cash flow information
Cash paid for period for:
Income taxes	$	—	$	100,262,236
Interest	$	—	$	4,000

Non-cash disclosures
Shares issued under incentive plan – employees	$	—	$	22,000,000
Shares issued to outside parties for services	$	—	$	66,500,000

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

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~~TINGO,~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc.)

NOTES TO ~~CONDENSED CONSOLIDATED~~ FINANCIAL STATEMENTS

JUNE 30, ~~2022~~2023

(Unaudited)

~~(1)~~~~Description of Business and Basis of Presentation~~

(1)

Description of Business and Basis of Presentation

Description of Business—~~Tingo,~~Agri-Fintech Holdings, Inc. ~~(collectively, with our subsidiary, “we,~~, formerly known as ‘Tingo, Inc.’ (“we,” “us,” “our,” ~~“Tingo”~~ and the “Company”), a Nevada corporation, was formed on February 17, 2015. Our shares trade on the OTC Markets trading platform under the symbol ‘TMNA’. ~~We acquired our wholly-owned subsidiary,~~

As described more fully under Note 2 - Sale of Tingo Mobile ~~PLC, a Nigerian public limited company~~ below, on December 1, 2022, we sold Tingo Mobile Limited (“Tingo Mobile”), our sole operating subsidiary, to Tingo Group, Inc. (“TIO”), a Nasdaq-traded financial services company (formerly known as MICT, Inc.), in exchange for 25,783,675 shares of TIO common stock and two series of preferred stock that are convertible into TIO common stock upon the occurrence of certain conditions (“Preferred Stock”). On July 27, 2023, we converted one of these series of Preferred Stock into 26,043,808 additional shares of TIO common stock. If we convert the remainder of the Preferred Stock, our shareholding in TIO will be equal to 75.0% of TIO’s outstanding common stock, calculated as of the date of the sale of Tingo Mobile. Importantly, because we expect to hold 75.0% of the outstanding TIO common stock at some point during 2023, this report will discuss the historical operations of Tingo Mobile as a ~~share exchange~~former subsidiary of the Company, and will discuss the future operations of Tingo Mobile, including the discussion of Risk Factors below, as a pending subsidiary of the Company.

Prior to our sale of Tingo Mobile, the Company, together with its ~~sole shareholder effective August 15, 2021. The Company, including its~~operating subsidiary, ~~Tingo Mobile, is~~was an Agri-Fintech company offering a comprehensive platform service through use of smartphones – ‘device as a service’ (using GSM technology) to empower a marketplace to enable subscribers/farmers within and outside of the agricultural sector to manage their commercial activities of growing and selling their production to market participants both domestically and internationally. The ecosystem provides a ‘one stop shop’ solution to enable such subscribers to manage everything from airtime top ups, bill pay services for utilities and other service providers, access to insurance services and micro finance to support their value chain from ‘seed to sale’.

AsOur principal office is located at 11650 South State Street, Suite 240, Draper, UT 84020, and the telephone number is +1-385-463-8168. Our corporate website is located at www.tingoinc.com. We make available free of June 30, 2022, Tingo had approximately 9.3 million subscribers using its mobile phones and Nwassa payment platform (www.nwassa.com). Nwassa is Africa’s leading digital agriculture ecosystem that empowers rural farmers and agri-businesses by using proprietary technology to enable access to market. Nwassa’s payment gateway also has an escrow structure that creates trust between buyers and sellers. Our system provides real-time pricing, straight from the farms, eliminating middlemen. Our users’ customers pay for produce bought using available pricingcharge on our ~~platform. Our platform~~website our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such material is ~~paperless, verified~~electronically filed or furnished to the Securities and ~~matched against a smart contract. Data is efficiently stored on the blockchain.~~

Our platform has created an escrow solution that secures the buyer, funds are not released to our members until fulfilment. The platform also facilitates trade financing, ensuring that banks and other lenders compete to provide credit to our members.

Tingo aims to be Africa’s leading Agri-Fintech player that transforms rural farming communities by enabling growers to connect through our proprietary platform to meet their complete needs from inputs, agronomy, off take and marketplace which delivers sustainable income in an impactful way. Additional information about the Company can be obtained from our website at ~~www.tingoinc.com~~Exchange Commission (“SEC”). ~~Our website, however, does not constitute a part of this Quarterly Report.~~

Basis of Presentation— The accompanying unaudited ~~condensed consolidated~~ financial statements have been prepared in accordance with the instructions to Form 10-Q and Articles 3 and 3A of Regulation S-X. The interim unaudited financial statements and notes thereto should be read in conjunction with the financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, including any amendments thereto, as filed with the Securities and Exchange Commission (“SEC”). All normal recurring adjustments considered necessary for a fair presentation have been included. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”).

As a result of the sale of our operating business on December 1, 2022 as described in Note 2, Sale of Tingo Mobile below, the following terms refer to our operations before and after the sale:

●

“Predecessor” and “Predecessor Period” refers to the consolidated operations of the Company from January 1, 2022 through June 30, 2022; and

●

“Successor” and “Successor Period” refers to the operations of the Company from December 1, 2022, the date of our sale of Tingo Mobile, through December 31, 2022, and from January 1, 2023 through June 30, 2023.

Our financial statements include our accounts and those of our wholly-owned subsidiaries, as applicable. All intercompany transactions and balances have been eliminated in the accompanying consolidated financial statements.

Our results of operations for the ~~quarter and~~Predecessor Period ended June 30, 2022, the year ended December 31, 2022, or the six months ended June 30, ~~2022~~2023 are not necessarily indicative of results that ultimately may be achieved for the remainder of ~~2022.~~2023.

~~The Impact of COVID-19~~~~—In response~~Due to the ~~COVID-19 pandemic, there have been a broad number~~lack of ~~governmental and commercial actions taken to limit the spread~~comparability of the virus, including social distancing measures, stay-at-home orders, travel restrictions, business shutdowns and slowdowns. The COVID-19 pandemic continues to be dynamic, and near-term challenges across the economy remain. Although vaccines are now being distributed and administered across many partsfinancial statements of the ~~world, new variants~~Predecessor Period with the Successor Period, our financial statements and related footnotes are presented with a “black line” division to emphasize the lack of ~~the virus have emerged~~comparability between amounts presented as of, and ~~may continue to emerge that have shown to be more contagious. We continue to adhere to applicable governmental~~after, December 1, 2022 and ~~commercial restrictions and to work to mitigate the impact of COVID-19 on our employees, customers, communities, liquidity and financial position.~~

amounts presented for all prior periods.

108

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~~(2)~~~~Entry Into Merger Agreement with MICT, Inc.~~

On October 6, 2022, the Company, MICT, Inc. (“MICT”), and representatives of each company’s shareholders entered into a Second Amended and Restated Agreement and Plan of Merger (“Restated Merger Agreement”). The common stock of MICT is traded on the Nasdaq Capital Market under the symbol ‘MICT’. The Restated Merger Agreement is the second restatement of the agreement and the result of efforts of Tingo and MICT to restructure the transaction as a multi-phase forward triangular merger (“Merger”) instead of as a reverse triangular merger as previously agreed. Under the terms of the Restated Merger Agreement, Tingo will create a newly-formed subsidiary incorporated in the British Virgin Islands (“Tingo BVI Sub”) to facilitate the Merger and hold the Company’s beneficial ownership interest in Tingo Mobile. MICT will also create a subsidiary incorporated in the British Virgin Islands (“MICT BVI Sub”), which will be merged with and into Tingo BVI Sub, with MICT BVI Sub as the surviving corporation and a subsidiary of MICT. The Merger will, therefore, result in Tingo Mobile becoming an indirect wholly-owned subsidiary of MICT, and the operations of Tingo Mobile, as an agri-fintech company, becoming the predominant operations of MICT. The aggregate consideration tendered by MICT to Tingo, the sole shareholder of Tingo Mobile, will consist of: (i) newly-issued common stock of MICT equal to 19.9% of its outstanding shares, calculated immediately prior to the closing date of the Merger; and (ii) two series of convertible preferred shares – Series A Convertible Preferred Stock and Series B Convertible Preferred Stock (collectively, the “MICT Preferred Shares”). The conversion of the MICT Preferred Shares is subject to various conditions, including approval of MICT’s shareholders and, in the case of the MICT Series B Convertible Preferred Stock, is also subject to Nasdaq approving a change of control of MICT. If all of the MICT Preferred Shares are converted into MICT common stock, Tingo will hold 75.0% of the outstanding shares of MICT. A summary of the Restated Merger Agreement and the actions taken by the Company and MICT in connection therewith are included in our Current Report on Form 8-K/A filed with the U.S. Securities and Exchange Commission on October 14, 2022. On November 9, 2022, we filed a definitive Information Statement to provide information to our shareholders about the Merger, the Merger Agreement, and the transactions contemplated thereby.

~~(3)~~~~Change in Accounting Treatment~~

As disclosed in the Company’s Current Report on Form 8-K filed on June 15, 2022, in preparation for the planned merger described in Note 2 above, the Company reviewed and considered its accounting treatment of its Acquisition of Tingo Mobile on August 15, 2021. Based on this review, the Company elected to modify its accounting treatment of the Acquisition as a reverse acquisition of the Company by Tingo Mobile instead of as a forward acquisition of Tingo Mobile by the Company as had been previously presented.

Accordingly, the financial statements included herein have been prepared in accordance with reverse acquisition accounting rules, which therefore include the consolidated operating results of Tingo Mobile for the full periods presented, rather than using forward acquisition accounting.

~~(4)~~~~Significant Accounting Policies~~

Reverse Acquisition Accounting—We have adopted reverse acquisition accounting methods in connection with the Company’s Acquisition of Tingo ~~Mobile.~~Mobile in 2021. Accordingly, the consolidated financial statements ~~include~~reflect the results of Tingo Mobile for the ~~periods~~Predecessor Periods indicated in this Report.

(2)

Sale of Tingo Mobile

Overview. On December 1, 2022, we sold Tingo Mobile, our sole operating subsidiary, to Tingo Group, Inc. (formerly known as MICT, Inc.), a Delaware corporation whose common shares are traded on the Nasdaq Capital Market under the symbol ‘TIO’. The sale was accomplished via a multi-phase forward triangular merger. Under the terms of the Merger Agreement we entered into with TIO and representatives of each of the shareholders of the Company and TIO, we contributed our ownership of Tingo Mobile to a newly organized holding company incorporated in the British Virgin Islands (“Tingo BVI Sub”). We then merged Tingo BVI Sub with and into MICT Fintech Ltd, a wholly-owned subsidiary of TIO also incorporated in the British Virgin Islands (“MICT Fintech”), resulting in Tingo Mobile being wholly-owned by TIO as a third-tier subsidiary (hereinafter, the “Merger”).

Consideration Received. As consideration for the Merger, we received the following:

●

Common and Preferred Stock. At the closing of the Merger, we received 25,783,675 shares of newly-issued common stock of TIO equal to 19.9% of its outstanding shares, calculated as of the closing date of the Merger, and two series of convertible preferred shares – Series A Convertible Preferred Stock (“Series A Preferred Stock”) and Series B Convertible Preferred Stock (“Series B Preferred Stock”). On July 27, 2023, we converted our Series A Preferred Stock into 26,042,808 shares of TIO common stock.

●

Undertaking to Pay Certain Liabilities of the Company. Pursuant to the terms of the Merger Agreement, we also received an undertaking from TIO to pay certain liabilities and accounts payable of the Company as of November 30, 2022, as well as certain other expenses relating to the maintenance of our reporting status under the Securities Exchange Act for the one-year period following the Merger. As of December 31, 2022 and June 30, 2023, the amount due to us pursuant to this undertaking was approximately $3.7 million and $3.6 million, respectively. This amount is set forth below as ‘Due from Related Party’ under Note 7 – Loans and Other Receivables – Related Parties.

Key Terms of Series B Preferred Stock. Upon approval by Nasdaq of the change of control of TIO and upon the approval of TIO’s stockholders, the Series B Preferred Stock will convert into 35.0% of the outstanding shares of TIO common stock, calculated as of the closing date of the Merger, giving the Company an aggregate ownership of 75.0% of TIO’s outstanding common stock. If such shareholder or Nasdaq approval is not obtained by September 30, 2023, we will have the right to cause TIO to redeem all of the Series B Preferred Stock for either of the following, at our option: (x) $667 million in cash or, (y) a 33.0% ownership interest in Tingo Group Holdings, LLC, a Delaware-incorporated subsidiary of TIO ("TGH"). TGH is the immediate parent of MICT Fintech, which is the sole shareholder of Tingo Mobile.

Temporary Investment Company Status. Effective upon the closing of the Merger, the Company became subject to the Investment Company Act of 1940, as amended (the “1940 Act”). Under the 1940 Act, any issuer of securities that has more than 100 beneficial owners and holds investment securities that exceed more than 40% of the value of the issuer’s unconsolidated assets is considered an ‘investment company’ and is therefore subject to various requirements of the 1940 Act, unless an exemption therefrom is applicable. Rule 3a-2 permits issuers such as the Company, to be “deemed not to be engaged in the business of investing, reinvesting, owning, holding or trading in securities” for up to one year from the date that the 1940 Act would have technically applied if (i) the issuer’s business activities are inconsistent with those of an investment company, and (ii) the issuer’s governing board passes a resolution stating the issuer’s “bona fide intent to be engaged primarily, as soon as is reasonably possible” to be “in a business other than that of investing, reinvesting, owning, holding or trading in securities” within such one year period. Because the Company is actively involved in acquiring operating assets or otherwise developing other operating businesses, its present activities are inconsistent with those of an investment company. Moreover, inasmuch as the Company expects to effect a conversion of the Series B Preferred Stock no later than September 30, 2023 and, therefore, consolidate the operations of TIO and its subsidiaries with the Company’s own operations, the Company has expressed its bona fide intent to be in a business other than that of an investment company.

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(3)

Significant Accounting Policies

The following is a summary of significant accounting policies followed by the Company in the preparation of our financial statements:

Consolidation—In accordance with Article 6 of Regulation S-X under the Securities Act of 1933, we do not consolidate equity interests we hold in other entities. Under the investment company rules and regulations pursuant to the American Institute of Certified Public Accountants (“AICPA”) Audit and Accounting Guide for Investment Companies, codified in ASC 946, we are precluded from consolidating any entity other than another investment company, except that ASC 946 provides for the consolidation of a controlled operating company that provides substantially all of its services to the investment company or its consolidated subsidiaries.

Valuation of Our Holdings in TIO—In connection with the sale of Tingo Mobile to TIO, we received shares of TIO common stock and two series of convertible preferred stock of TIO, one of which series which has since been converted into TIO common stock. The shares of TIO common stock are traded on the Nasdaq Capital Market under the symbol ‘TIO’. Because, at December 31, 2022 and June 30, 2023, more than 40% of the value of our unconsolidated assets consists of ‘investment securities’ (as such term is defined pursuant to the Investment Company Act of 1940, as amended (the “1940 Act”), we are considered an ‘investment company’ under the 1940 Act and, as a result, we are required to assess the fair value of our holding in TIO.

Fair Value Measurement. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date and sets out a fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). Inputs are broadly defined as assumptions market participants would use in pricing an asset or liability. The three levels of the fair value hierarchy are described below:

●

Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

●

Level 2—Inputs other than quoted prices within Level 1 that are observable for the asset or liability, either directly or indirectly; and fair value is determined through the use of models or other valuation methodologies.

●

Level 3—Inputs are unobservable for the asset or liability and include situations where there is little, if any, market activity for the asset or liability. The inputs into the determination of fair value are based upon the best information under the circumstances and may require significant management judgment or estimation.

Management Considerations. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specific to the asset. In the case of Tingo, we assessed the nature of our holding of common and convertible Preferred Stock in TIO and considered certain factors which, in management’s view, made this holding a Level 2 asset, including the following:

●

the lack of institutional trading in TIO common stock; and

●

the conditions associated with conversion of the TIO Preferred Stock into TIO common stock.

With respect to the last point above, we consider it significant that, should conversion of our Series B Preferred Stock not occur by September 30, 2023, we can require TIO to redeem these shares in exchange for (1) a cash payment obligation of $667 million or, in the alternative, (2) 35% ownership in TGH valued at $667 million, which imputes an underlying equity value of Tingo Mobile that is substantially higher than the TIO common and TIO Preferred stock on an as-converted basis.

Determination of Fair Value. In view of the foregoing analysis and in accordance with ASC 820 and ASC 805, we calculated a fair value of the consideration we received in connection with the Merger at $1,215,241,000. ASC 820 requires that fair value to maximize objective evidence and be determined using assumptions that a market participant would use, and when level 1 inputs exist, it should be used unless determined to be not representative. That would have meant using the unadjusted TIO quoted price at the time of completion of the Merger. We are of the opinion however, that the TIO market value per share price as quoted on Nasdaq as of the closing date of the Merger was not representative of the fair value and should not be used to determine the merger consideration. Using

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market value per share of TIO would have led to a significant realized loss as well as other valuation anomalies that it created. Hence, and in accordance with ASC 805-30-30-5, we reassessed the determination of the consideration transferred and determined that the use of the quoted price of our Class A common stock on the OTC at market close is more appropriate in determining the consideration fair value..

Use of Estimates—The preparation of financial statements in accordance with U.S. GAAP requires us to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Although we believe the estimates and assumptions used in preparing these financial statements and related notes are reasonable in light of known facts and circumstances, actual results could differ from those estimates.

Earnings Per Share— Basic and diluted per share calculations are computed utilizing the weighted-average number of shares of common stock outstanding for the period. Pursuant to our 2021 Equity Incentive Plan, ~~adopted in 2021, in accordance with ASC 260,~~ ~~Earnings Per Share~~, the unvested shares of restricted stock awarded ~~in the quarter and six months ended June 30, 2022~~ pursuant to our equity compensation plans are participating securities and, therefore, are included in the basic earnings per share calculation.

Share-Based Compensation—We account for share-based compensation using the fair value method, as prescribed by ASC 718, Compensation-Stock Compensation. Accordingly, for restricted stock awards, we measure the grant date fair value based upon the market price of our common stock on the date of the grant and amortize the fair value of the awards as share-based compensation expense over the requisite service period, which is generally the vesting term. For all share-based awards that are not subject to vesting, we recognize expense associated with the award during the period in which the award is granted, in an amount equal to the number of shares granted, multiplied by the closing trading price of the shares on the relevant grant date. Determining the appropriate fair value of share-based awards requires the use of subjective assumptions, particularly given that the Company’s common stock is not actively traded. The assumptions used in calculating the fair value of share-based awards ~~represents~~represent management’s best estimates and involve inherent uncertainties and the application of management’s judgment. As a result, if factors change and management uses different assumptions, share-based compensation expense could be materially different for future awards.

Classes of Common Stock—The Company has two classes of common stock. Each share of Class A common stock is entitled to one (1) vote, and is entitled to receive dividends when and if declared by the board of directors out of assets legally available therefore. Each share of Class B common stock is entitled to ten (10) votes, but carries no dividend, distribution, liquidation, conversion, or economic rights of any kind.

Retained Earnings— The components that make up distributable earnings for the Successor Period and the Predecessor Period on the Company’s Balance Sheet as of June 30, 2023 and 2022 are as follows:


	Successor Period		Predecessor Period
	Six Months Ended		Six Months Ended
	June 30, 2023		June 30, 2022

Net income (loss) for period	$	(30,126,128)	$	105,202,833
Retained Earnings - beginning of period		818,796,244		416,095,565
Retained Earnings	$	788,670,116	$	521,298,398

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~~Classes of Common Stock~~Accounts Receivable—The Company ~~has two classes~~had no accounts receivable during the six months ended June 30, 2023. During the Predecessor Period, the total value of ~~common stock. Each share of Class A common stock~~the twelve-month mobile leasing contract was recognized under accounts receivable at the outset. The balance is ~~entitled to one (1) vote,~~due and payable and is ~~entitled~~credited as receipts are received from the customers. Management reviews accounts receivable periodically to ~~receive dividends when~~determine if any receivables will potentially be uncollectible. Management’s evaluation includes several factors including the aging of the accounts receivable balances, a review of significant past due accounts, economic conditions, and ~~if declared by~~our historical write-off experience, net of recoveries. Tingo Mobile includes any accounts receivable balances that are determined to be uncollectible, along with a general reserve, in its allowance for doubtful accounts. After all attempts to collect a receivable have failed, the ~~board~~receivable is written off against the allowance. Given the manner in which Tingo Mobile bundles its services with its branded phones, it does not typically incur a substantial amount of directors out of assets legally available therefor. Each share of Class B common stock is entitled to ten (10) votes, but carries no dividend, distribution, liquidation, conversion, or economic rights of any kind.

~~Distributable Earnings— The components that make up distributable earnings (accumulated retained earnings) on~~bad debt. Accordingly, during the ~~Consolidated Balance Sheet as of~~six months ended June 30, 2022, we made a general allowance of 3% of all accounts receivable and ~~December 31, 2021 are as follows:~~

June 30, 2022

December 31, 2021

Net Income (Loss) for period

$
105,202,833

$
(39,026,340)
Acquisition of Company’s Former Business (IWeb)

—

(3,316,865)
Retained earnings

416,095,565

458,538,770

Retained Earnings

$
521,298,398

$
416,095,565

recognized bad debt expense of approximately $47,000 for such period.

Impairment of Long-Lived Assets—~~In accordance with authoritative guidance on accounting for the impairment or disposal of long-lived assets, as set forth in Topic 360 of the ASC, the~~The Company assesses the recoverability of the carrying value of its long-lived assets when events occur that indicate an impairment in value may exist. An impairment loss is indicated if the sum of the expected undiscounted future net cash flows is less than the carrying amount of the assets. If this occurs, an impairment loss is recognized for the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. There was no impairment of long-lived assets ~~during~~for the six months ended June 30, ~~2022~~2023 and ~~June 30, 2021.~~2022.

Income Taxes—The Company uses the liability method of accounting for income taxes under which deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the accounting bases and the tax bases of the Company’s assets and liabilities. The deferred tax assets are computed using enacted tax rates in effect for the year in which the temporary differences are expected to reverse.

The Company has adopted ASC guidance regarding accounting for uncertainty in income taxes. This guidance clarifies the accounting for income taxes by prescribing the minimum recognition threshold an income tax position is required to meet before being recognized in the consolidated financial statements and applies to all income tax positions. Each income tax position is assessed using a two-step process. A determination is first made as to whether it is more likely than not that the income tax position will be sustained, based upon technical merits, upon examination by the taxing authorities. If the income tax position is expected to meet the more likely than not criteria, the benefit recorded in the consolidated financial statements equals the largest amount that is greater than 50% likely to be realized upon its ultimate settlement. AtAs of June 30, ~~2022~~2023 and ~~December 31, 2021,~~2022, there were no uncertain tax positions that required accrual.

The reconciliation of income tax benefit ~~of our parent company~~ at the U.S. statutory rate of ~~25.0% for six months and year ended June 30, 2022 and December 31, 2021, respectively,~~25% to the Company’s effective tax rate for the six months ended June 30, 2023 and 2022 is as follows:


	June 30, 2022		Percent		December 31, 2021		Percent		Six Months Ended June 30,
									2023		Percent		2022		Percent
Federal statutory rates	$	25,305,997	25.0	%	$	65,199,716	25.0	%
Income tax benefit									$	(5,175,613)	25.0	%	$	(25,305,997)	25.0	%
Valuation allowance against net deferred tax assets		(25,305,997)	(25.0)	%		(65,199,716)	(25.0)	%		5,175,613	25.0	%		25,305,997	25.0	%
Effective rate	$	—	0.00	%	$	—	0.00	%
Effective Rate									$	—	0.00	%	$	—	0.00	%

The tax effects of temporary differences that give rise to the Company’s net deferred tax assets ~~on an unconsolidated basis~~ for the ~~quarter and year~~six months ended June 30, ~~2022~~2023 and ~~December 31, 2021, respectively,~~2022 are as follows:


	June 30, 2022		December 31, 2021
Deferred Tax Assets					June 30, 2023		June 30, 2022

Beginning of period	$	—	$	—	$	—	$	—
Net Operating Loss Carryforward		90,505,713		65,199,716
Valuation Allowance		(90,505,713)		(65,199,716)
Net operating losses						100,856,938		90,505,713
Valuation allowance						(100,856,938)		(90,505,713)
Net Deferred Tax Assets	$	—	$	—	$	—	$	—

The income of a foreign subsidiary is not necessarily subject to U.S. tax, provided the income is from the active conduct of a trade or business within the non-U.S. jurisdiction. However, earnings of the foreign subsidiary, to the extent reinvested in the U.S. or distributed to the U.S. parent as a dividend, may be subject to U.S. tax. In addition, the Internal Revenue Code requires that transfer pricing between a U.S. parent and a foreign subsidiary be made on an arms’ length basis. Tingo Mobile, our sole operating subsidiary during the Predecessor Period, did not issue any dividends during such period.

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In our ~~Consolidated~~ Statements of ~~Comprehensive Income,~~Operations, as consolidated for the Predecessor Period, we have deducted taxes payable in connection with our former operations in Nigeria. However, inasmuch as the U.S. and Nigeria do not have a tax treaty, we do not receive a corresponding credit in the U.S. for tax paid in Nigeria by Tingo Mobile, then our wholly-owned subsidiary. In addition, our parent company ~~Tingo, Inc.~~ has incurred operating losses on an unconsolidated basis, largely due to non-cash expenses associated with stock awards made pursuant to our 2021 Equity Incentive Plan. Our ability to utilize tax losses associated with the operations of our parent company is restricted, however, due to limitations on the deductibility of certain share compensation to our executive officers and directors that may be deemed ‘excess compensation’ pursuant to Section 162(m) of the Internal Revenue Code.

Subject to any such disallowances pursuant to Code Section 162(m), ~~as of June 30, 2022,~~ the Company has approximately ~~$90.5~~$98.2 million of net operating losses carried forward to offset taxable income, if any, in future years which expire commencing in fiscal year 2037. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment. Based on this assessment, management has established a full valuation allowance against all of the deferred tax asset relating to ~~NOLs~~NOL’s because it is more likely than not that all of the deferred tax asset will not be realized as the parent company is not presently income producing.

~~Inventory~~—The Company holds certain stocks of spare parts to support the maintenance of new phones. These are recorded at cost. The company does not hold significant stock of new phones in the event of damage or replacement. Inventory is measured on the first-in, first-out method.

Operating Segments—We have examined our operating business for the six months ended June 30, 2022 in the Predecessor Period and the six months ended June 30, 2023 in the Successor Period pursuant to the guidance of ASC 280, Segment Reporting, which establishes standards for reporting information about operating segments. It also establishes standards for related disclosures about customers, products and geographic areas. Operating segments are defined as components of an enterprise that engage in business activities that earn revenues, incur expenses and prepare separate financial information that is evaluated regularly by our Chief Operating Decision Maker (“CODM”) in order to allocate resources and assess performance. Resources are allocated and performance is assessed by the CODM.

Based on the provisions of ASC 280, we ~~have~~ evaluated our former operating business and considered various factors associated therewith, including the concentration of our business in one country and the integration of our leasing business with the use of our agri-fintech platform that utilizes software embedded within the leased device. Accordingly, this evaluation resulted in one reportable segment.

~~Deferred Income~~— We reflect the full value of the 12-month revenues due in accordance with our mobile leasing contracts. We recognize leasing revenue from these contracts over the 12-month term. We do not allocate the costs of our mobile phones against these revenues as a cost of sales, but instead recognize depreciation expense ratably on a straight-line basis over the estimated 3-year useful life of the devices.

Leased Assets— ~~We make use of~~The Company has entered into leasing arrangements principally for the provision of ~~our~~the offices and related facilities. The rental contracts for offices are typically negotiated for terms of between 1 and 10 years and some of these have extension terms. Lease terms for office fixtures and equipment have lease terms of between 1 year and 10 years without any extension terms. The Company does not enter into sale and leaseback arrangements. All the leases are negotiated on ~~an individual basis and contain~~ a ~~wide variety of different terms and conditions such as purchase options and escalation clauses. The Company assesses whether a contract is or contains a lease at inception of the contract.~~month-to-month basis. A lease conveys the right to direct the use and obtain substantially all of the economic benefits of an identified asset for a period of time in exchange for consideration.

Measurement and Recognition of Leases as a Lessee—At During the Predecessor Period, at lease commencement date, ~~we recognize~~Tingo Mobile recognized a right-of-use asset and a lease liability on the balance sheet. The right-of-use asset is measured at cost, which is made up of the initial measurement of the lease liability, any initial direct ~~costs~~expenses incurred by the company, an estimate of any ~~costs~~expenses to dismantle and remove the asset at the end of the lease, and any lease payments made in advance of the lease commencement date (net of any incentives received). ~~We depreciate~~Tingo Mobile depreciates the right-of-use assets on a straight-line basis from the lease commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. WeTingo Mobile also ~~assess~~assesses the right-of-use asset for impairment when such indicators exist.

AtAlso during the Predecessor Period, at the commencement date, ~~we measure~~Tingo Mobile measures the lease liability at the present value of the lease payments unpaid at that date, discounted using the interest rate implicit in the lease if that rate is readily available or the incremental borrowing rate. The incremental borrowing rate is the estimated rate that ~~the Company~~Tingo Mobile would have to pay to borrow the same amount over a similar term, and with

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similar security to obtain an asset of equivalent value. This rate is adjusted should the lessee entity have a different risk profile to that of ~~the Company.~~Tingo Mobile.

Lease payments included in the measurement of the lease liability are made up of fixed payments (including in substance fixed), variable payments based on an index or rate, amounts expected to be payable under a residual value guarantee and payments arising from options reasonably certain to be exercised.

Subsequent to initial measurement, the liability will be reduced by lease payments that are allocated between repayments of principal and finance ~~costs.~~expenses. The finance cost is the amount that produces a constant periodic rate of interest on the remaining balance of the lease liability.

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The lease liability is reassessed when there is a change in the lease payments. Changes in lease payments arising from a change in the lease term or a change in the assessment of an option to purchase a leased asset. The revised lease payments are discounted using the incremental borrowing rate at the date of reassessment when the rate implicit in the lease cannot be readily determined. The amount of the remeasurement of the lease liability is reflected as an adjustment to the carrying amount of the right-of-use asset. The exception being when the carrying amount of the right-of-use asset has been reduced to zero then any excess is recognized in profit or loss.

Payments under leases can also change when there is either a change in the amounts expected to be paid under residual value guarantees or when future payments change through an index or a rate used to determine those payments, including changes in market rental rates following a market rent review. The lease liability is remeasured only when the adjustment to lease payments takes effect and the revised contractual payments for the remainder of the lease term are discounted using an unchanged discount rate. Except for where the change in lease payments results from a change in floating interest rates, in which case the discount rate is amended to reflect the change in interest rates.

The remeasurement of the lease liability is dealt with by a reduction in the carrying amount of the right-of use asset to reflect the full or partial termination of the lease for lease modifications that reduce the scope of the lease. Any gain or loss relating to the partial or full termination of the lease is recognized in profit or loss. The right-of-use asset is adjusted for all other lease modifications.

~~The Company~~Tingo Mobile has elected to account for short-term leases and leases of low-value assets using the practical expedients. These leases relate to the use of residential houses for a ~~year.~~one-year period by traveling Tingo Mobile executives. Instead of recognizing a right-of-use asset and lease liability, the payments in relation to these are recognized as an expense on a straight-line basis over the lease term.

~~Accounting Pronouncements~~~~—In August 2020, the FASB issued ASU No. 2020-06, “~~Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40) - Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity,” which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments. The new guidance removes the separation models for convertible debt with a cash conversion feature or a beneficial conversion feature. In addition, the new standard provides guidance on calculating the dilutive impact of convertible debt on earnings per share. The ASU clarifies that the average market price should be used to calculate the diluted earnings per share denominator when the exercise price or the number of shares that may be issued is variable. The ASU is effective for the Company on January 1, 2022, including interim periods, with early adoption permitted. The ASU permits the use of either a full or modified retrospective method of adoption. The Company is still evaluating the impact of the adoption of this ASU on its future financial statements and disclosures.

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~~(5)~~~~Share-Based Compensation~~

(4)

Share-Based Compensation

On October 6, 2021, the Company’s Board of Directors adopted our 2021 Equity Incentive Plan (“Incentive Plan”), the purpose of which was to promote the interests of the Company by encouraging directors, officers, employees, and consultants of Tingo to develop a long-term interest in the Company, align their interests with that of our stockholders, and provide a means whereby they may develop a proprietary interest in the development and financial success of the Company and its stockholders. The Incentive Plan is also intended to enhance the ability of the Company and its subsidiaries to attract and retain the services of individuals who are essential for the growth and profitability of the Company. The Incentive Plan permits the award of restricted stock, common stock purchase options, restricted stock units, and stock appreciation awards. The maximum number of shares of our Class A common stock that are subject to awards granted under the Incentive Plan is 131,537,545 shares. The term of the Incentive Plan will expire on October 6, 2031. On October 12, 2021, our stockholders approved our Incentive Plan and, during ~~the fourth quarter of~~ 2021 and ~~the first six months of~~ 2022, the Tingo Compensation Committee granted awards under the Incentive Plan to certain directors, executive officers, employees, and consultants in the aggregate amount of 131,370,000 shares. The majority of the awards so issued are each subject to a vesting requirement over a 2-year period unless the recipient thereof is terminated or removed from their position without “cause”, or as a result of constructive termination, as such terms are defined in the respective award agreements entered into by each of the recipients and the Company. We account for share-based compensation using the fair value method, as prescribed by ASC 718, Compensation—Stock Compensation. Accordingly, for restricted stock awards, we measure the grant date fair value based upon the market price of our common stock on the date of the grant and amortize the fair value of the awards as share-based compensation expense over the requisite service period, which is generally the vesting term. For all stock awards under the Incentive Plan that are not subject to vesting, we recognize expense associated with the award during the period in which the award is granted, in an amount equal to the number of shares granted, multiplied by the closing trading price of the shares on the relevant grant date. In connection with these awards, we recorded stock-based compensation expense ~~and professional fees~~ of ~~$29.2~~$20.7 million and $101.2 million for the ~~three and~~ six months ended June 30, 2023 and 2022, respectively. As of June 30, ~~2022,~~2023, total compensation expense to be recognized in future periods is ~~$53.6~~$12.2 million. The weighted average period over which this expense is expected to be recognized is ~~1.5~~0.29 years.

The following table summarizes the activity related to granted, vested, and unvested restricted stock awards under the Incentive Plan for the six months ended June 30, ~~2022:~~2023:

Weighted

Number of

Average Grant

Shares

Date Fair Value
Unvested shares outstanding, January 1, 2022

36,950,833

$
1.80
Shares Granted

22,500,000

$
3.93
Shares Vested

32,176,510

$
3.15
Shares Forfeited

—

—
Unvested shares outstanding, June 30, 2022

27,274,322

$
1.97


		Weighted
	Number of	Average Grant
	Shares	Date Fair Value
Unvested shares outstanding, January 1, 2023	16,732,916	$	1.97
Shares granted	—		—
Shares vested	10,541,406	$	1.96
Shares forfeited	—		—
Unvested shares outstanding, June 30, 2023	6,191,510	$	1.98

(5)

~~(6)~~Revenue Recognition

Policy

Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that ~~we expect~~the Company expects to receive in exchange for those goods. ~~We apply~~The Company applies the following five-step model in order to determine this amount:

1.~~Identification of the promised goods in the contract;~~

2.~~Determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract;~~

3.~~Measurement of the transaction price, including the constraint on variable consideration;~~

4.~~Allocation of the transaction price to the performance obligations; and~~

5.~~Recognition of revenue when (or as) the Company satisfies each performance obligation.~~

Identification of the promised goods in the contract;

Determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract;

Measurement of the transaction price, including the constraint on variable consideration;

Allocation of the transaction price to the performance obligations; and

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Recognition of revenue when (or as) the Company satisfies each performance obligation.

WeThe Company only ~~apply~~applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. ~~We recognize~~The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. ~~Generally, our~~During the Predecessor Period, the Company’s performance obligations ~~for phone~~with regard to its leasing contracts are ~~recognized~~satisfied over time ~~while~~in the case of our ~~obligations for agri-fintech services, which are usage based, are transferred to customers~~mobile phone leases, and at a point in time in the case of our agri-fintech services, typically upon delivery.

During the Predecessor Period, our revenue was comprised of lease payments for our smartphone devices, and fees for services and financial technology solutions. We offered service-only contracts and contracts that bundle equipment used to access the services and/or with other service offerings. Some contracts had fixed terms and others are cancellable on a short-term basis (i.e., month-to-month arrangements). We have elected to record revenue net of taxes collected from our customers that are remitted to governmental authorities, with the collected taxes recorded within other current liabilities until remitted to the relevant government authority.

~~Our~~Sources

During the Predecessor Period (prior to our sale of Tingo Mobile), the Company had the following principal revenue ~~is principally comprised~~sources:

●

Mobile Leasing – customers entered an annual contract for a fixed monthly rental. The customers are committed for the full term. Our accounting policy was to recognize lease revenue ratably during the term. We did not assess a cost of sales associated with such lease revenue, but instead depreciated our mobile devices ratably on a straight-line basis over their estimated useful life of 36 months.

●

Call and Data Services – our customers used call and data services at normalized rates which, given the increasing proliferation of wifi connections, even in rural locations, have steadily declined over time.

●

Nwassa services – this is Tingo Mobile’s Agri-Fintech platform powered by the smartphones leased on an annual term as described above, known as ‘device as a service’. Revenue was recognized based on the following basis as out performance obligations are satisfied:

●

Agri- Marketplace –percentage of the value of produce trade on Nwassa

●

Mobile Airtime Top-up – fixed percentage of value of top-up

●

Utilities – fixed percentage of value of transaction

●

Mobile Insurance – fixed fee recognized monthly based on contract

●

Financial Services (Loans and Related Services) – fixed referral fee depending upon service provided

While Tingo Mobile’s Nwassa applications are integrated with its branded phones, each of ~~lease payments for smartphone devices, and fees for services and financial technology solutions.We offer service-only contracts and contracts that bundle equipment used to access~~ the services ~~and/or with other service offerings. All mobile leasing contracts have fixed terms.~~

~~Sources~~

are distinct and contain independent performance obligations. The ~~Company has~~range and quantity of services used are determined solely by the ~~following revenue sources:~~end-user.

●~~Mobile Leasing~~ ~~– customers enter a~~ ~~12-month~~ contract for a fixed monthly rental. The customers are committed for the full term. Our accounting policy is to recognize lease revenue ratably during the term. We do not asses a cost of sales associated with such lease revenue, but instead depreciate our mobile devices ratably on a straight-line basis over their estimated useful life of 36 months.

●~~Call and Data Services~~ ~~– our customers use call and data services at normalized rates which, given the increasing proliferation of wifi connections, even in rural locations, have steadily declined over time.~~

●~~Nwassa services~~ ~~– this is our Agri-Fintech platform. Revenue is recognized based on fixed percentage of the value of the transaction on the following basis when transactions are executed as follows:~~

●~~Agri- Marketplace – fixed percentage of the value of produce trade on Nwassa~~

●~~Mobile airtime top up – fixed percentage of value of top-up~~

●~~Utilities – fixed percentage of value of transaction~~

●~~Mobile Insurance – fixed fee recognized monthly based on contract~~

●~~Financial Services (Loans and related services) – fixed referral fee as completed~~

(6)

Foreign Currency Translation

~~(7)~~~~Foreign Currency Translation~~

~~Functional and presentation currency~~—The consolidated financial statements are presented in U.S. dollars, which is the presentation currency and the functional currency during the Successor Period, and the functional currency for the Predecessor Period is Nigeria Naira.

~~The exchange rate used for conversion is:~~

June 30,

December 31,

2022

2021
Balance Sheet:





Nigerian Naira

414.72

412.99

Profit and Loss :





Nigerian Naira

413.855

396.46

Due to the sale of Tingo

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~~Foreign currency transactions~~—Mobile, our sole operating subsidiary, on December 1, 2022, the exchange rate is not applicable as of and for the six months ended June 30, 2023.

The exchange rates used for conversion are:


	June 30,	December 31,
	2023	2022
Balance Sheet:

Nigerian Naira	n/a	412.99

Statement of Operations:

Nigerian Naira	n/a	396.46

Foreign currency transactions are translated into the functional currencies of the Company’s subsidiaries using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized in the consolidated statements of operations and comprehensive income. Non-monetary items carried at cost are translated using the exchange rate at the date of the transaction. Non-monetary items carried at fair value are translated at the date the fair value is determined. For Nigeria, due to the volatile nature of the exchange rate, during the Predecessor Period, we ~~have~~ applied the prudent approach to convert both the ~~Profit and Loss~~Statement of Operations and Balance Sheet at the same rate to indicate a fairer reflection of the state of affairs.

(7)

Loans and Other Receivables – Related Parties

~~(8)~~~~Inventory~~

~~Inventory on hand~~Loans and other receivables due from related parties consisted of the ~~following:~~following as of June 30, 2023 and December 31, 2022:


	June 30, 2022		December 31, 2021		June 30, 2023		December 31, 2022
Spare parts	$	33,913	$	129,823

Total Inventory	$	33,913	$	129,823
Due from related party					$	3,631,949	$	3,713,179
Advances to related party						—		58,489
Note receivable due from Tingo Mobile, dated October 15, 2022, interest at 5%, due on May 10, 2024						16,426,744		15,866,000
Total loans and other receivables – related parties					$	20,058,693	$	19,637,668

Due from related party consists of obligations due under the terms of the Merger Agreement with TIO. Pursuant to the terms of the agreement, TIO agreed to pay certain liabilities and accounts payable of the Company as of November 30, 2022, as well as certain other expenses relating to the maintenance of our reporting status under the Securities Exchange Act for the one-year period following the Merger.

The note receivable due from Tingo Mobile relates to sums provided to Tingo Mobile by the Company during the Predecessor Period to acquire mobile devices in the fourth quarter of 2022 and was advanced to Tingo Mobile prior to its sale to TIO as described Under Note 2 – Sale of Tingo Mobile above. The balance consists of principal in the amount of $15,866,000 and interest of $560,744.

(8)

Investments in Securities

Investment in Securities—In connection with the sale of Tingo Mobile as described under Note 2 above, we concluded a value of $1.2 billion for the consideration received from TIO, determined in accordance with ASC 820 and ASC 805. ASC 820 requires that a fair value determination be based on objective evidence, using assumptions that a market participant would use, and when level 1 inputs exist, it should be used unless determined to be not representative. As described in Note 4 above, we are of the opinion that the TIO trading price, as quoted on Nasdaq, is not representative of the fair value of the consideration received and should not be used to determine the merger consideration. Accordingly, pursuant to ASC 805-30-30-5, we determined that a reference to the Company’s share price, as traded at the OTC at the closing of the Merger, is a more appropriate determinant of fair value.

~~(9)~~~~Accounts and Other Receivables~~

June 30, 2022

December 31, 2021

Trade and other receivable gross

$
318,749,400

$
364,350,175
Allowance for expected credit loss

(5,660)

(42,065)

318,743,740

364,308,110
Directors current account

—

289

$
318,743,740

$
364,308,399

~~Accounts Receivable—~~~~This amount consists almost exclusively of trade receivables relating to our~~ 3-year smartphone leasing contract which our customers entered during 2021. The release and delivery of new phones in accordance with our two new lease contracts with our cooperative customers that took place in May and August of 2021, each of which were renewed in May and August of 2022. The balances reflect the remaining balance outstanding as of June 30, 2022 and December 31, 2021. The December 31,2021 balances also include balance due from one off sales completed in November 2021. This outstanding balance was fully repaid in January 2022. The previous lease contracts expired in May 2020. The delay in renewal of new contracts in 2021 was due to the impact of Covid 19 and resultant delays in recommencement of our supply chains as a consequence. The new phone leasing contracts will expire in April 2023 and July 2023 respectively. The Company had approximately 9.3 million subscribers for this service as of June 30, 2022 and December 31, 2021. The Company has successfully renewed its previous contract that expired in May 2020 without any attrition in the number of subscribers. We view this as significant, given the gap of a year due to the Covid-19 pandemic that affected our supply chain in 2020 and the early part of 2021. We believe it is a clear demonstration of our ability to maintain subscriber loyalty and reflection of affordability at the price point we offer our subscribers over the three-year leasing period. Management reviews accounts receivable periodically to determine if any receivables will potentially be uncollectible. Management’s evaluation includes several factors including the aging of the accounts receivable balances, a review of significant past due accounts, economic conditions, and our historical write-off experience, net of recoveries. The Company includes any accounts receivable balances that are determined to be uncollectible, along with a general reserve, in its allowance for doubtful accounts. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. We recognized bad debt expense of $57 during the quarter ended June 30, 2022 and $47,455 for the six months ended June 30,2022. The allowance for credit loss for the six months ended June 30, 2022 was $5,660 and was $42,065 for the year ended December 31, 2021.

We offer our customers the option to purchase certain wireless devices in installments over a specified period of time and, in many cases, once certain conditions are met, they may be eligible to trade in the original equipment for a new device and have the remaining unpaid balance paid or settled. As of December 31, 2021, all receivables on this arrangement have been collected and the balance has been written off, and no new receivables have been incurred during the quarter ended June 30, 2022.

We have a strong history of mobile leasing to our subscriber base in partnership with our farmers’ cooperatives. Unlike a typical mobile leasing business, we analyze credit risk on these cooperatives and not directly with our 9.3 million subscribers. We have history of leasing to the same number of subscribers since 2017 and have a strong collection record where the cooperatives settle the monthly leasing receivables in bulk. The cooperatives manage the interaction and collection from their members and, therefore, we do not

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undertake direct credit risk with our subscribers. This ‘business to business’ credit model has assured minimal bad debts and late payments, as well as reduced administrative effort needed to collect monthly receivables due over the 12~~-month contract.~~

~~(10) Property, Plant & Equipment~~

MOTOR

FURNITURE &

OFFICE

PLANT &

SITE

MOBILE



LAND

BUILDING

VEHICLES

FITTINGS

EQUIPMENT

MACHINERY

INSTALLATIONS

DEVICES

Total


$

$

$

$

$

$

$

$

$
COST

December 31, 2021

8,794,695

31,774,624

207,709

60,009

66,142

10,112,085

191,316,838

1,219,411,221

1,461,743,324
ADDITIONS

—

—

—

—

—

—

—

—

—
Forex translation difference

(36,687)

(132,549)

(866)

(250)

(276)

(42,182)

(798,076)

—

(1,010,886)
June 30, 2022

8,758,008

31,642,075

206,844

59,759

65,866

10,069,903

190,518,762

1,219,411,221

1,460,732,438

DEPRECIATION

December 31, 2021

—

8,246,459

126,507

41,444

62,662

10,092,916

—

244,290,317

262,860,305
CHARGED FOR THE YEAR

—

810,705

13,412

3,222

1,135

4,486

9,545,848

202,688,055

213,048,863
Forex translation difference

—

(36,128)

(556)

(180)

(264)

(42,112)

(19,910)

—

(99,150)
June 30, 2022

—

9,021,036

139,363

44,486

63,533

10,055,290

9,525,938

446,978,372

475,810,018

NET BOOK VALUE

December 31, 2021

8,794,695

23,510,165

81,202

18,565

3,480

19,169

191,316,838

975,120,904

1,198,883,019
June 30, 2022

8,758,008

22,621,040

67,480

15,273

2,333

14,613

180,992,824

772,432,849

984,922,420

~~The fixed assets table above refers to the Tingo Mobile business as consolidated into Tingo, Inc. for the six months and year ended June 30, 2022 and December 31, 2021, respectively.~~

Property, plant and equipment are carried at historical value and depreciated over their useful life. All property and equipment with a cost of $5,000 or greater are capitalized. Major betterments that extend the useful lives of assets are also capitalized. Normal maintenance and repairs are charged to expense as incurred. When assets are sold or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in operations.

~~Plant and equipment consist of prototypes, mobile devices leased to our customers, software, furniture and equipment, which are depreciated on a straight-line basis over their expected useful lives.~~

	(9)
	Liquidity and Financing Arrangements	~~Estimated useful lives~~
		~~(years)~~
~~Buildings~~		20
~~Motor Vehicles~~		5
~~Furniture & Fittings~~		5
~~Office Equipment~~		5
~~Plant & Machinery~~		4
~~Mobile Devices~~		3
~~Site Installations~~		20

~~Site Installations relates to the capitalization of the Company’s investment in rural fibre network and equipment. Depreciation on these assets commenced from January 1, 2022.~~

~~The total depreciation charge for the six months ended June 30, 2022 and June 30, 2021 was $202,688,055 and $865,930~~

~~(11) Intangible Assets~~

~~Intangible Assets~~—The details below relate to Intangible Assets for Tingo Mobile as consolidated into the Company for the six months ended June 30, 2022. This represents cost incurred on software development of our mobile operating system and secure browser. This is Tingo’s proprietary operating system and mobile/web browser. The system and its technology platform is designed to help our customers securely execute financial transactions. This cost is amortized over 5 (Five) years, because on or before then we are expected to have significantly upgraded the software. For the six months ended June 30, 2022, the Company incurred capitalized costs of $ 0 and charged $568,569 in amortization costs for this period.

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Cost

As of January 1, 2022

$
6,193,507
Additions

—
Forex translation difference

(519,680)
As of June 30, 2022

5,673,827

Amortization

As of January 1, 2022

4,026,671
Charge for the period

568,569
Forex translation difference

(17,984)
As of June 30, 2022

4,577,256

Carrying Amount as of June 30, 2022

$
1,096,571

~~(12) Liquidity and Financing Arrangements~~

Liquidity—There are several factors that may materially affect our liquidity during the reasonably foreseeable future including, for example, currency volatility, foreign exchange controls and other items that affect our cash ~~flows to our parent company.~~flows. In view of the foregoing, we believe that our operating cash flow and cash on hand will be sufficient to meet operating requirements from the date of this filing through the next twelve months.

Cash and Cash Equivalents—As of June 30, 2023, we had cash and cash equivalents of approximately $14,000. As of December 31, 2022, we had cash and cash equivalents of $104.1 million on a consolidated basis. As of December 31, 2021, we had cash and cash equivalents of $128.4 million on a consolidated basis. The cash and cash equivalent mainly consists of funds held with the company’s bank in Nigeria.approximately $1,000. We seek to optimize value by managing and placing excess liquidity on fixed deposits to earn income from such excess cashflows. ~~Reduction is cash and cash equivalent is mainly due to a significant repayment of accounts payables to our core suppliers of mobile phones.~~

~~(13)~~(10) Current and Non-Current Liabilities

Accounts ~~Payable~~payable and ~~Accruals~~accruals

June 30, 2022

December 31, 2021
Trade payables

$
99,260,527

$
754,709,170
Accrued compensation

2,135,389

1,049,029
Accrued interest

19,726

—
Other payables

(86,806)

126,994
Total Accounts Payable and Accruals

$
101,328,836

$
755,885,193

Accounts payable and accruals consisted of the following:


	June 30, 2023		December 31, 2022
Accounts payable	$	955,364	$	1,003,787
Accrued compensation		4,485,355		2,948,013
Other payables		1,020,248		334,381
Total accounts payable and accruals	$	6,460,967	$	4,286,181

~~Trade Payables~~Advances from Related Party— Advances from related party was $465,000 as of June 30, 2023 compared to $505,000 as of December 31, 2022. These advances consist of expenses paid on behalf of the Company by a related party. These advances are non-interest bearing.

Notes Payable – Related Parties— This amount represents a promissory note in the ~~balance~~amount of $23,700,000 due to ~~our smartphone suppliers~~TIO. The Note is dated October 6, 2022, bears interest at ~~June 30, 2022 and December 31, 2021.~~

~~Deferred Income~~~~—The balance represents to gross income due over~~ the ~~term of the~~ ~~3-year~~ phone leasing cycle. Monthly releases to revenue will be conducted in line with our revenue recognition policy and will reduce to $0 by April 2024 and July 2024 accordingly. The table below provides the aging of the balances between current and non-current liabilities as follows:

June 30, 2022

December 31, 2021
Due within one year

$
298,262,348

$
221,215,018
Over one year

—

—
Total Deferred income

298,262,348

221,215,018

Deferred income - current portion

298,262,348

221,215,018
Deferred income - non-current portion

—

—
Total Deferred income

$
298,262,348

$
221,215,018

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~~VAT~~~~—This represents the current and future VAT liability at~~ rate of ~~7.5% relating to the mobile phone leasing contracts included under Accounts Receivable and Deferred Income. The table below shows the aging of when such liabilities will become due and payable:~~

June 30, 2022

December 31, 2021
Due within one year

$
23,340,039

$
17,162,192
Over one year

—

—
Total Value added tax

23,340,039

17,162,192

Value added tax - current portion

23,340,039

17,162,192
Value added tax - non-current portion

—

—
Total Value added tax

$
23,340,039

$
91,793,817

~~(14) Notes and Loans Payable~~

On May 13, 2022, in connection with the Merger Agreement described in Note (2) above, we issued a Senior Promissory Note (“Note”) to MICT in the original principal amount of $3,000,000, bearing interest at 5% per annum and ~~maturing~~is due on ~~the first to occur of (i)~~ May 10, ~~2024, or (ii) thirty days from~~2024.

(11) Commitments and Contingencies

Operating Leases—During the ~~date of termination of the Merger Agreement. On July 28, 2022,~~Predecessor Period, we issued a First Replacement Senior Promissory Note to MICT, which superseded the Note and increased the principal amount to $3,500,000, with all other material terms and conditions of the original Note unchanged. Interest expense and interest accrued on the Notewere responsible for ~~the quarter ended June 30, 2022 was $19,726.~~

~~We also borrowed $49,945 from a third party during the second quarter of 2022, which amount is payable on demand. From time to time to facilitate the operation of~~an operating lease covering office space in Nigeria for Tingo Mobile, our ~~Company, we will~~former operating subsidiary. We continue to ~~procure short-~~be subject to an operating lease in the United States on a month-to-month basis. We consider this arrangement to be a ‘low value lease’ and, ~~long-term loans~~accordingly, have not recognized a right of ~~various amounts and maturities.~~use asset or liability in our financial statements.

Litigation Settlement(~~15) Taxation and Deferred Tax~~

~~The provision for income tax consists of the following components for~~—During the six months ended June 30, ~~2022 and 2021:~~

June 30, 2022

June 30, 2021
Income tax⁽¹⁾

$
82,765,443

$
27,530,801
Education tax

5,517,696

1,835,387
Current Tax

$
88,283,139

$
29,366,188

~~(1) Tax provision is based on pre-tax income of Tingo Mobile on~~2023, we settled a ~~stand-alone basis for~~lawsuit with ClearThink Capital, LLC (“ClearThink”). Pursuant to the ~~period indicated.~~

~~The significant components~~terms of the ~~tax liabilities~~settlement, on the one-year anniversary date of the settlement, we are obligated to pay ClearThink Capital, LLC a combination of Company common stock and common stock of TIO held by the Company equal in value to $7.7 million. Accordingly, we have recognized this contingency payment on our balance sheet as of June 30, ~~2022~~2023.

Legal Proceedings―While we are not currently subject to any legal proceedings, from time to time, the Company or one or more of its subsidiaries may become a party to certain proceedings incidental to the normal course of our business. While the outcome of any potential legal proceedings cannot at this time be predicted with certainty, we do not expect that any such proceedings will have a material effect upon our financial condition or results of operations.

Estimated losses from contingencies are accrued by a charge to earnings when information available prior to the issuance of the financial statements indicates that it is likely that a future event will confirm that an asset has been impaired or a liability incurred at the date of the financial statements and ~~December 2021 are summarized below:~~

Current Tax Liabilities

June 30, 2022

December 31, 2021
Beginning of period

$
100,606,352

$
67,601,594
Charge for the period⁽¹⁾

88,283,139

104,802,090

188,889,491

172,403,684
Paid during the period

(100,262,236)

(62,946,048)
Forex translation difference

(664,890)

(8,851,284)

Total Current Tax Liabilites

$
87,962,365

$
100,606,352

~~(1) Tax liability is based on pre-tax income~~the amount of ~~Tingo Mobile on a stand-alone basis for~~ the ~~period indicated.~~loss can be reasonably estimated.

~~The significant components of~~(12) Related-Party Transactions and Agreements

See Note 7 –Loans and Other Receivables and the ~~deferred tax liabilities as of June 30, 2022~~disclosures in Note 10 - Current and ~~December 31, 2021 are summarized below:~~Non-current Liabilities.

Deferred Tax

June 30, 2022

December 31, 2021
Beginning of period

$
2,171,039

$
2,360,004
Change for the period

2,184,276

—
Forex translation difference

(18,168)

(188,965)
Total Deferred Tax Liabilities

$
4,337,147

$
2,171,039

2018

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~~(16) Related-Party Transactions and Agreements~~

From ~~time to time,~~time-to-time, we may enter into transactions or incur indebtedness to persons affiliated with members of our board of directors, or executive officers. We will seek to ensure that, to the greatest extent possible, any such agreements or transactions are undertaken on an arms-length basis and representative of standard commercial terms and conditions that would be available to us from third parties. During the quarter ended June 30, 2022, we received an advance of $89.2 million affiliates of our founder and CEO, Dozy Mmobuosi, to satisfy short-term capital needs of Tingo Mobile, our wholly-owned operating subsidiary. We expect to repay this advance later in 2022.

~~(17) Legal Proceedings~~

On May 23, 2022, ClearThink Capital LLC, a Florida limited liability company claiming to be an investment banking firm (“ClearThink”), filed a complaint against the Company alleging a breach by TingoNote payable – related party consists of a ~~purported non-circumvention agreement and an alleged obligation~~promissory note due to ~~pay ClearThink an investment banking fee~~TIO in connection with the ~~planned merger~~Merger Agreement. The note has a principal amount of ~~the Company with a wholly-owned subsidiary of MICT, Inc. The lawsuit seeks relief for breach of contract, a breach of the covenant of good faith~~$23,700,000, accrues interest at 5% per annum, and fair dealing, and unjust enrichment, and also seeks declaratory relief, injunctive relief, and an award of costs, attorneys’ fees, and expenses. We believe that this lawsuit, and the allegations included therein, are without merit, particularly in view of the fact that ClearThink and its Managing Director, Craig Marshak, failed to disclose to Tingo their lackis due on May 10, 2024.

Note receivable – related party consists of a ~~required broker-dealer license, or~~promissory note due from Tingo Mobile that ~~Robert S. Brown,~~was used to acquire mobile devices during the ~~Chief Executive Officer~~Predecessor Period in the fourth quarter of ~~ClearThink, was subject to an Order from the SEC suspending him from practicing before the Commission. While the outcome~~2022. The note has a principal amount of ~~the lawsuit cannot~~$15,866,000, accrues interest at ~~this time be predicted with certainty, we do not expect that the proceeding will have a material effect upon Tingo’s financial condition or results of operations.~~

~~From time to time, the Company~~5% per annum, and is a party to certain other proceedings incidental to the normal course of our business including the enforcement of our rights under contracts with our customers and subscribers. While the outcome of these legal proceedings cannot at this time be predicted with certainty, we do not expect that these proceedings will have a material effect upon the Company’s financial condition or results of operations.due on May 10, 2024.

~~(18)~~(13) Subsequent Events

Management performed an evaluation of the Company’s activity through the date the financial statements were issued, noting the following subsequent event:

~~Entry~~On July 27, 2023, we converted our holding of TIO Series A Preferred Stock into ~~Second Amended and Restated Merger Agreement~~~~. As described above~~26,042,808 shares of TIO common stock. This did not result in ~~Note 2 –~~ ~~Entry Into Restated Merger Agreement with MICT~~~~, on October 6, 2022, the Company, MICT, and representatives~~a change in control of ~~each company’s shareholders entered into the Restated Merger Agreement.~~TIO.

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Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

~~Tingo,~~Agri-Fintech Holdings, Inc. ~~(collectively with our subsidiary, “we,~~, formerly known as ‘Tingo, Inc.’ (“we,” “us,” “our,” ~~“Tingo” or~~and the “Company”), a Nevada corporation, was formed on February 17, 2015. Our shares trade on the OTC Markets trading platform under the symbol ‘TMNA’. ~~We acquired our wholly-owned subsidiary,~~

As described more fully under Sale of Tingo Mobile ~~PLC, a Nigerian public limited company~~ below, on December 1, 2022, we sold Tingo Mobile Limited (“Tingo Mobile”), our sole operating subsidiary, to Tingo Group, Inc. (“TIO”), a Nasdaq-traded financial services company (formerly known as MICT, Inc.), in exchange for 25,783,675 shares of TIO common stock and two series of preferred stock that are convertible into TIO common stock upon the occurrence of certain conditions (“Preferred Stock”). On July 27, 2023, we converted one of these series of Preferred Stock into 26,042,808 additional shares of TIO common stock. If we convert the remainder of the Preferred Stock, our shareholding in TIO will be equal to 75.0% of TIO’s outstanding common stock, calculated as of the date of the sale of Tingo Mobile. Importantly, because we expect to hold 75.0% of the outstanding TIO common stock at some point during 2023, this report will discuss the historical operations of Tingo Mobile as a ~~share exchange~~former subsidiary of the Company, and will discuss the future operations of Tingo Mobile as a pending subsidiary of the Company.

As of June 30, 2022, Tingo had approximately 9.3 million leasing customers using its mobile phones and who also use the Company’s agri-fintech platform (www.nwassa.com). Nwassa is considered to be Africa’s leading digital agriculture ecosystem that empowers rural farmers and agri-businesses by using proprietary technology to enable access to markets in which they operate. Farmers in Nigeria use the Nwassa agri-trading platform to support the supply and purchase of a variety of agricultural inputs and produce. The system provides real-time pricing, straight from the farms, eliminating middlemen. Our users’ customers pay for produce bought using available pricing on our platform.

The Nwassa platform has also created an escrow solution that secures the buyer, inasmuch as funds are not released until fulfilment. The platform also facilitates trade financing, ensuring that banks and other lenders compete to provide credit to our members.

Although we have a large retail subscriber base, ours is essentially a business-to-business-to-consumer (“B2B2C”) business model. Each of our subscribers is a member of one of two large farmers’ cooperatives with whom we have a contractual relationship and which relationship facilitates the distribution of our branded smartphones into various rural communities of member farmers. And it is through our phones and our proprietary applications imbedded therein where we are able to distribute our wider array of agri-fintech services and generate the diverse revenue streams as described in more detail in this report.

Our principal office is located at ~~43 West 23~~^rd11650 South State Street, 2^nd ~~Floor, New York, NY 10010,~~Suite 240, Draper, UT 84020, and the telephone number is ~~+1-646-847-0144.~~+1-385-463-8168. Our corporate website is located at www.tingoinc.com~~although it does not constitute a part of this Quarterly Report.~~. We make available free of charge on our website our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports as soon as reasonably practicable after such material is electronically filed or furnished to the Securities and Exchange Commission (“SEC”). ~~Our~~

Sale of Tingo Mobile

Overview. On December 1, 2022, we sold Tingo Mobile, our sole operating subsidiary, to TIO. The sale was accomplished via a multi-phase forward triangular merger. Under the terms of the Merger Agreement we entered into with TIO and representatives of each of the shareholders of the Company and TIO, we contributed our ownership of Tingo Mobile to a newly organized holding company incorporated in the British Virgin Islands (“Tingo BVI Sub”). We then merged Tingo BVI Sub with and into MICT Fintech Ltd, a wholly-owned subsidiary of TIO also incorporated in the British Virgin Islands (“MICT Fintech”), resulting in Tingo Mobile being wholly-owned by TIO as a third-tier subsidiary (hereinafter, the “Merger”).

Consideration Received. As consideration for the Merger, we received the following:

●

Common and Preferred Stock. At the closing of the Merger, we received 25,783,675 shares of newly-issued common stock of TIO equal to 19.9% of its outstanding shares, calculated as of the closing date of the Merger, and two series of convertible preferred shares – Series A Convertible Preferred Stock (“Series A Preferred Stock”) and Series B Convertible Preferred Stock (“Series B Preferred Stock”). On July 27, 2023, we converted the Series A Preferred Stock into 26,042,808 additional shares of TIO common stock.

●

Undertaking to Pay Certain Liabilities of the Company. Pursuant to the terms of the Merger Agreement, we also received an undertaking from TIO to pay certain liabilities and accounts payable of the Company as of November 30, 2022, as well as certain other expenses relating to the maintenance of our reporting status under the Securities Exchange Act for the one-year period following the Merger. As of December 31, 2022 and June 30, 2023, the amount due to us pursuant to this undertaking was approximately $3.7 million and $3.6 million, respectively. This amount is set forth below in our audited financial statements as ‘Due from Related Party’ under Note 7 – Loans and Other Receivables – Related Parties.

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Structure. Immediately following the Merger, our ownership interest in TIO and TIO’s ownership of Tingo Mobile was as shown in the following diagram (other subsidiaries of TIO not shown):

Key Terms of SeriesB Preferred Stock. Upon approval by Nasdaq of the change of control of TIO and upon the approval of TIO’s stockholders, the Series B Preferred Stock will convert into 35.0% of the outstanding shares ~~are traded on OTC Markets~~of TIO common stock, calculated as of the closing date of the Merger, giving the Company an aggregate ownership of 75.0% of TIO’s outstanding common stock. If such shareholder or Nasdaq approval is not obtained by June 30, 2023, we will have the right to cause TIO to redeem all of the Series B Preferred Stock for either of the following, at our option: (x) $666,666,667 in cash or, (y) a 33.0% ownership interest in Tingo Group Holdings, LLC, a Delaware-incorporated subsidiary of TIO as shown in the diagram above ("TGH"). TGH is the immediate parent of MICT Fintech, which is the sole shareholder of Tingo Mobile.

Temporary Investment Company Status. Effective upon the closing of the Merger, the Company became subject to the Investment Company Act of 1940, as amended (the “1940 Act”). Under the 1940 Act, any issuer of securities that has more than 100 beneficial owners and holds ‘investment securities’ (as defined under the ~~ticker symbol ‘TMNA’.~~1940 Act) that exceed more than 40% of the value of the issuer’s unconsolidated assets is considered an ‘investment company’ and is therefore subject to various requirements of the 1940 Act, unless an exemption therefrom is applicable. One such requirement of the 1940 Act includes determining the fair value of equity securities held by the issuer instead of consolidating the underlying operations of such equity holdings. Rule 3a-2 permits issuers such as the Company, to be “deemed not to be engaged in the business of investing, reinvesting, owning, holding or trading in securities” for up to one year from the date that the 1940 Act would have technically applied if (i) the issuer’s business activities are inconsistent with those of an investment company, and (ii) the issuer’s governing board passes a resolution stating the issuer’s “bona fide intent to be engaged primarily, as soon as is reasonably possible” to be “in a business other than that of investing, reinvesting, owning, holding or trading in securities” within such one year period. Because the Company is actively involved in acquiring operating assets or otherwise developing other operating businesses, its present activities are inconsistent with those of an investment company. Moreover, inasmuch as the Company expects to effect a conversion of the Series B Preferred Stock no later than September 30, 2023 and, therefore, consolidate the operations of TIO and its subsidiaries with the Company’s own operations, the Company has expressed its bona fide intent to be in a business other than that of an investment company.

The information contained in this section should be read in conjunction with our financial statements and notes thereto appearing elsewhere in this ~~Quarterly Report~~10-Q and in conjunction with the financial statements and notes thereto in the Company’s Annual Report on Form 10-K and any subsequent amendments thereto (“10-K”). In addition, some of the statements in this report constitute forward-looking statements. The matters discussed in this ~~Quarterly Report,~~10-Q, as well as in future oral and written statements by management of Tingo, that are forward-looking statements are based on current management expectations that involve substantial risks and uncertainties which could cause actual results to differ materially from the results expressed in, or implied by, these forward-looking statements. Forward-looking statements relate to future events or our future financial performance. We generally identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these terms or other similar words. Important assumptions include our ability to generate revenues, achieve certain margins and levels of profitability, and the availability of additional capital. In light of

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these and other uncertainties, the inclusion of a forward-looking statement in this ~~Quarterly Report~~10-Q should not be regarded as a representation by us that our plans or objectives will be achieved. The forward-looking statements contained in this ~~Quarterly Report~~10-Q include statements as to:

●

our future operating results;

●

our business prospects;

●

currency volatility, foreign exchange, and inflation risk;

●

our contractual arrangements with our customers and other relationships with third parties;

●

the dependence of our future success on the general economy and its impact on the industries in which we invest;

~~Table of Contents~~

●

political instability in the countries in which we operate;

●

uncertainty regarding certain legal systems in Africa;

●

our dependence upon external sources of capital;

●

our expected financings and capital raising;

●

our regulatory structure and tax treatment;

●

the adequacy of our cash resources and working capital;

●

the timing of cash flows from our operations;

●

the impact of fluctuations in interest rates on our business;

●

market conditions and our ability to access additional capital, if deemed necessary;

●

uncertainty regarding the timing, pace and extent of an economic recovery in the United States and elsewhere; and

●

natural or man-made disasters and other external events that may disrupt our operations.

There are a number of important risks and uncertainties that could cause our actual results to differ materially from those indicated by such forward-looking statements. For a discussion of factors that could cause our actual results to differ from forward-looking statements contained in this ~~Quarterly Report,~~10-Q, please see the discussion in “Item 1A. Risk Factors” in our 10-K. In particular, you should carefully consider the risks we have described in the 10-K and elsewhere in this ~~Quarterly Report~~10-Q concerning the coronavirus pandemic and the economic impact of the coronavirus on the Company and our operations. You should not place undue reliance on these forward-looking statements. The forward-looking statements made in this ~~Quarterly Report~~10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date this ~~Quarterly Report~~10-Q is filed with the SEC.

~~Entry Into Merger Agreement with MICT, Inc.~~

~~Acquisition of Tingo Mobile plc~~

On August 15, 2021, the Company acquired all of the share capital of Tingo Mobile plc, a Nigerian corporation (“Tingo Mobile”) from Tingo International Holdings, Inc., a Delaware corporation (“TIH”), the sole shareholder of Tingo Mobile. Pursuant to

2322

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the Acquisition Agreement executed in connection with the transaction, as subsequently amended, we issued TIH 1,028,000,000 shares of our Class A common stock and 65,000,000 shares of our Class B common stock. We also paid various fees and expenses in connection with the transaction, including 27,840,000 shares of our Class A common stock as a finder’s fee.

Results of Operations

~~Three Months Ended June 30, 2022 Compared with the Three Months Ended June 30, 2021~~

~~The Company’s consolidated results from operations for the three months ended June 30, 2022 and June 30, 2021 are summarized as follows:~~

Three Months Ended

% of

% of

(in Thousands)

June 30, 2022

Revenue

June 30, 2021

Revenue

Revenue

$
268,685

—

$
100,731

—

Operating Expense

(146,662)

54.58
%

(49,724)

49.36
%
Operating Income

122,023

45.42
%

51,007

50.64
%

Other Income, net

114

—

80

—

Income before taxes

122,138

45.46
%

51,087

50.72
%
Income tax⁽¹⁾

(49,584)

(16,348)

Income from continuing operations

72,553

27.00
%

34,739

34.49
%
Net Income

$
72,553

27.00
%
$
34,739

34.49
%
~~(1) Tax liability is based on pre-tax income of~~Because we sold Tingo Mobile, our sole operating subsidiary, on December 1, 2022, a ~~stand-alone basis for the period indicated.~~

~~Tingo’s operating income for the three months ended June 30, 2022 was $122.0 million as compared to $51.0 million during the three months ended June 30, 2021, an increase~~comparison of ~~$71.0 million, or 139.2%. The substantial increase as compared to the second quarter~~results of ~~2021 is largely due to renewal~~operations, cost of ~~the mobile leasing activity that commenced in May 2021~~revenues, and August 2021 with our two partner cooperatives, as well as the revenue contribution made by our Nwassa agri-fintech platform. We believe the increased adoption rates and growth in our Nwassa user base are a clear demonstration of how rapidly the Nwassa agri-fintech platform, powered through a smartphone, is providing value and convenience to farming and rural communities. We earn up to a 4.0% commission on Nwassa services, which have net margins of over 90.0%. As Nwassa becomes a progressively larger component of our aggregate revenue, we expect overall gross profit margins, as well as aggregate profit, to increase accordingly. This is reflective in the growth of Tingo’s Net Income of $72.5 million for the three months ended June 30, 2022 compared to $34.7 million for the three months ended June 30, 2021, an increase of $37.8 million, or 108.9%.
~~Six Months Ended June 30, 2022 Compared with the Six Months Ended June 30, 2021~~
~~The Company’s consolidated results from operations~~related items for the six months ended June 30, ~~2022 and June 30, 2021 are summarized as follows:~~

Six Months Ended

% of

% of

(in Thousands)

June 30, 2022

Revenue

June 30, 2021

Revenue

Revenue

$
525,742

—

$
145,970

—

Operating Expense

(332,556)

63.25
%

(54,340)

37.23
%
Operating Income

193,186

36.74
%

91,630

62.77
%

Other Income, net

300

—

139

—

Income before taxes

193,468

36.80
%

91,769

62.87
%
Income tax (current period)⁽¹⁾

(88,283)

(29,366)

Income from continuing operations

105,203

20.01
%

62,403

42.75
%
Net Income

$
105,203

20.01
%
$
62,403

42.75
%
~~(1) Tax liability is based on pre-tax income of Tingo Mobile on a stand-alone basis for the period indicated.~~

~~Table of Contents~~

~~Tingo’s operating income for~~2023 with the six months ended June 30, 2022 was $193.2 million as compared to $91.6 million during the six months ended June 30, 2021, an increase of $101.6 million, or 110.0%. As with the comparative three-month results discussed above, the substantial increase is largely due to renewal of the mobile leasing activity that commencedwould not be meaningful and, consequently, has not been included in May and August 2021, as well as the significantly positive growth of revenue mix in the higher margin business in Nwassa, where we earn up to a 4.0% commission on various agri-fintech transactions and have relatively insignificant marginal costs as compared to our sales and leasing business.

~~Revenue~~this section.

~~Three Months Ended June 30, 2022 and 2021~~

Three Months Ended

June 30, 2022

June 30, 2021
Mobile Phone leasing

$
122,068,101

$
55,301,413
Services- Mobile calls & data

15,750,628

10,413,632

NWASSA revenue

130,866,170

35,016,349
Airtime

3,626,243

2,103,211
Brokerage on loans

6,025,477

485,053
Insurance

6,626,878

2,058,221
Trading on agricultural produce

65,437,480

16,599,033
Utility

49,150,092

13,770,831
Total Revenue

$
268,684,899

$
100,731,394

~~Six Months Ended June 30, 2022 and 2021~~


Six Months Ended

June 30, 2022

June 30, 2021
Mobile Phone leasing

$
243,841,958

$
55,301,413
Services- Mobile calls & data

29,477,240

23,990,510

NWASSA revenue

252,423,220

66,677,596
Airtime

7,051,761

4,138,750
Brokerage on loans

10,146,128

1,050,328
Insurance

13,222,078

2,058,221
Trading on agricultural produce

127,635,985

31,699,485
Utility

94,367,268

27,730,812
Total Revenue

$
525,742,418

$
145,969,519

~~Generally~~. We generated total revenue of $268.7 million during the quarter ended June 30, 2022 compared to $100.7 million during the quarter ended June 30, 2021, an increase of $168.0 million, or 167.8%. During the six months ended June 30, 2022, we generated revenue of $525.7 million as compared to $146.0 million during the six months ended June 30, 2021, an increase of $379.7 million, or 260.0%. In addition to recognizing leasing and service revenue from our mobile phones during the first half of 2022, we also experienced sharp growth in the utilization of our Nwassa agri-fintech platform as compared to the first half of 2021. This platform delivered strong growth in revenue, increasing from $35.0 million and $66.7 million during the three and six months ended June 30, 2021, respectively, to $130.9 million and $252.4 million during the three and six months ended June 30, 2022, respectively. This represents growth of 274.0% and 278.4% for the respective comparative periods. Our Nwassa agri-fintech business now represents approximately 48.0% of total revenue for the six months ended June 30, 2022 as compared to approximately 45.7% of total revenue for the six months ended June 30, 2021. The principal reasons for the increases during the second quarter and first half of 2022 as compared to the second quarter and first half of 2021 were as follows:
● Our strategy of enabling rural communities with an affordable smartphone ‘device as a service’ has proved successful in increasing the volume of agri-produce trading being conducted on the platform. Given the fees we earn through these services, we estimate that the Company processed just under $6.0 billion in transaction volume for our subscribers during the first half of 2022.

~~Table of Contents~~

●

Agri-trading revenues for the second quarter and first half of 2022 were $65.5 million and $127.6 million, respectively, as compared to $16.6 million and $31.7 million during the second quarter and first half, respectively, of 2021. The number of farmers trading produce on our system has also increased by a significant level as compared to prior periods. We believe that this is a clear demonstration of the value that Nwassa offers farmers as the platform of choice to trade their produce into the domestic market.

●

Utility top-ups on Nwassa saw revenues increase to $49.2 million and $94.4 million for the quarter and six months, respectively, ended June 30, 2022, as compared to $13.8 million and $27.7 million for the quarter and six months, respectively, ended June 30, 2021. This represents a growth rate of 356.5% on a quarter-over-quarter basis, and a 340.8% growth rate as compared to the first half of 2021. The level of activity is a strong indicator of the level of trust and reliability that consumers place on our service, with virtually no resistance to the transaction fees we charge.

●

The significant growth in Nwassa revenues is in line with our strategy to expand our Agri-Fintech business as our core focus with the access to mobile devices as an enabler to assure access and connectivity to our Nwassa platform.

●

~~The decline in the Naira -USD exchange rate from June 30, 2021 to June 30, 2022 has been mitigated by the significant organic growth of both volume and margins on our agri-fintech trading business.~~

~~Mobile leasing revenues continue to be in line with expectations of the one-year leasing contract and has been slightly impacted by the declining exchange rate.~~

Leasing revenue is recognized over 12 months in equal instalments from the date of sign up of the contract. Inasmuch as our lease agreements did not commence until later in the first half of 2021, wherein we had $55.3 million in leasing revenue during the quarter and six months ended June 30, 2021 as compared to $122.1 million and $243.8 million for the quarter and six months ended June 30, 2022, respectively.

Nwassa, our Agri-Fintech platform generated 48.7% and 48.0% of total Company revenue during the three and six months ended June 30, 2022, respectively, compared to 34.8% and 45.7% of total revenue for the three and six months ended June 30, 2021, respectively.

Utility top-up activity levels more than tripled during the three and six months ended June 30, 2022 as compared to the three and six months ended June 30, 2021. We believe that the strong performance of the Agri-fintech side of our business is a clear demonstration of the maturity and adoption of the Nwassa platform by a higher percentage of our ‘Device as a Service’ customer base powered through farmers’ cooperatives. The level of loan brokerage, which was relatively negligible in the first six months of 2021 increased to $10.1 million for the six months ended June 30, 2022. Of note was the residual revenue stream in the first half of 2022 resulting from the one-time sale of mobile phones in the fourth quarter of 2021, where we estimate that at least 30% of the non-leasing customer base who purchased these phones registered for access to the Nwassa platform to manage airtime and utility payments during the first six months of 2022. This is significant, inasmuch as it is a demonstration of our successful campaigns we ran to register customers who bought a phone via a third non-agricultural cooperative with which we contracted in November 2021.

However, we believe that it is important to understand that the provision of smartphones is the means to drive a higher level of access to our Agri-Fintech platform Nwassa, to enable our customers to participate in our Agri-marketplace, top up their airtime, pay for utilities, insure their mobile devices and access credit services through partner institutions. Typical fees and commissions on these services can be up to 4.0%. Insurance revenue is fixed at $0.24 per device per month. Our focus on providing an affordable mobile device is core to the delivery of our fintech services and we call that ‘Device as a Service’ model. The richness of our Agri-Fintech service and related payment services deliver a very unique model of social upliftment and financial inclusion to rural communities. The agri-marketplace we have created provides our customers with an opportunity to market their fresh produce to reduce the ‘time to market’ and contribute towards our objectives to support the rural farming community with products and services that enable reduction in ‘post-harvest losses’ - a key area of focus for us as part of our investment to deliver services through use of smartphones to drive tangible social upliftment through increased sales for such farmers using the Nwassa platform.

~~Table of Contents~~

~~Cost of Sales~~

~~Three Months Ended June 30, 2022 and 2021~~

~~The following table sets forth the cost of sales for the three months ended June 30, 2022 and June 30, 2021:~~

Three Months Ended


June 30, 2022

June 30, 2021

Commission to Cooperatives and Agents

$
2,992,488

$
2,046,256
Cost of Mobile Phones

122,366

45,435,433

Total cost of sales

$
3,114,854

$
47,481,689

~~Six Months Ended June 30, 2022 and 2021~~
~~The following table sets forth the cost of sales for the six months ended June 30, 2022 and June 30, 2021:~~


Six Months Ended

June 30, 2022

June 30, 2021
Commission to Cooperatives and Agents

$
5,492,328

$
4,558,197
Cost of Resold Mobile Phones

122,366

45,435,433

Total cost of sales

$
5,614,694

$
49,993,630

The Company’s cost of sales for the three and six months ended June 30, 2022 was $3.1 million and $5.6 million, respectively, as compared to $47.5 million and $50.0 million for the three and six months ended June 30, 2021, respectively. The lower cost of sales in the first half of 2022 was due to no bulk sales of mobile phones during those periods.
~~Cost of sales consists of two key elements:~~
● ~~Commissions to Cooperatives and Agents~~ ~~- the Company has over 17,000 agents that support the rollout of our services through Cooperatives and an independent agency network of rural farmers and women.~~
● ~~Cost of Resold Mobile Phones~~ ~~– from time to time, we will sell our branded phones in one-off bulk sale transactions. In such cases, we allocate the costs of manufacture and delivery against the sales price of the phones.~~

~~Table of Contents~~

Selling, General & Administrative Expenses

~~Three Months Ended June 30, 2022 and 2021~~

~~The following table sets forth selling, general and administrative expenses for the three months ended June 30, 2022 and June 30, 2021:~~

Three Months Ended


June 30, 2022

June 30, 2021

Payroll and related expenses

$
20,329,684

$
773,918
Distribution expenses

288,774

6,245
Professional fees

12,821,414

307,681
Bank fees and charges

360,373

173,201
Depreciation and amortization

106,876,493

721,339
General and administrative – other

2,887,859

260,346
Bad debt expenses

57

—

Selling, General and Administrative Expenses

$
143,546,654

$
2,242,730

~~Six Months Ended June 30, 2022 and 2021~~
The following table sets forth selling, general and administrative expenses for the six months ended June 30, ~~2022~~2023 and ~~June 30, 2021:~~2022:


Six Months Ended

Six Months Ended

June 30, 2022

June 30, 2021

June 30, 2023

June 30, 2022

Depreciation and amortization

$
—

$
213,617,432
Professional fees

579,084

68,490,826
Payroll and related expenses

$
39,570,896

$
1,464,614

21,950,792

39,570,896
Bank fees and charges

1,774

996,420
Distribution expenses

509,961

110,818

—

509,961
Professional fees

68,490,826

623,115
Bank fees and charges

996,420

236,025
Depreciation and amortization

213,617,432

1,461,955
Bad debt expenses

—

47,455
General and administrative – other

3,726,772

449,513

7,752,555

3,708,772
Bad debt expenses

47,455

—

Selling, General and Administrative Expenses

$
326,941,762

$
4,346,040

$
30,284,205

$
326,941,762

~~Prior year expenses mainly relate~~The significant payroll expense and professional fees for the first six months of 2022 as compared to ~~general and administrative expenses relating~~the first six months of ~~Tingo Mobile only. Our acquisition~~2023 relates to the vesting of ~~Tingo Mobile and the attendant expenses to maintain our status as~~ a ~~public reporting company has substantially increased these costs. In addition, in the fourth quarter~~significant number of ~~2021, we adopted~~stock awards granted under our 2021 Equity Incentive Plan ~~which provided for, among other awards, shares of restricted stock to Plan participants.~~during the period. This resulted in stock-based compensation expense for staff and directors of $34.4 million and stock-based payments of professional fees of ~~$101.2~~$66.8 million ~~in the aggregate~~ for the six months ~~ended June 30, 2022. A detailed breakdown~~ of ~~other costs included in Selling General~~2022, as compared to stock-based compensation expense for staff and ~~Administrative Expenses are contained in~~directors of $20.4 million and stock-based payments of professional fees of $289,000 for the ~~Consolidated Profit and Loss Statement. A substantial part~~first six months of ~~these costs relate to Tingo Mobile’s operations in Nigeria and operational costs related to our parent company, Tingo, Inc.~~2023.

~~Table of Contents~~

2021 Equity Incentive Plan

Table of Contents

million for the ~~three and~~ six months ended June 30, 2023 and 2022, respectively. As of June 30, ~~2022,~~2023, total compensation expense to be recognized in future periods is ~~$53.6~~$12.2 million. The weighted average period over which this expense is expected to be recognized is ~~1.5~~0.29 years.

The following table summarizes the activity related to granted, vested, and unvested restricted stock awards under the Incentive Plan for the six months ended June 30, ~~2022:~~2023:


		Weighted			Weighted
	Number of	Average Grant		Number of	Average Grant
	Shares	Date Fair Value		Shares	Date Fair Value
Unvested shares outstanding, January 1, 2022	36,950,833	$	1.80
Unvested shares outstanding, January 1, 2023				16,732,916	$	1.97
Shares Granted	22,500,000	$	3.93	—		—
Shares Vested	32,176,510	$	3.15	10,541,406	$	1.96
Shares Forfeited	—		—	—		—
Unvested shares outstanding, June 30, 2022	27,274,322	$	1.97
Unvested shares outstanding, June 30, 2023				6,191,516	$	1.98

Liquidity and Capital Resources

~~Sources and Uses of Cash~~: Our principal sources of liquidity are our cash and cash equivalents, and cash generated from operations. On September 24, 2021, we filed a Form D with the Securities and Exchange Commission indicating the sale of our securities in one or more private transactions (the “Private Offering”). We expect that, as a result of the Private Offering, we will also be able to secure sufficient operating and working capital for our parent company activities for the next twelve months.

Cash on Hand. As of June 30, ~~2022,~~2023, our cash and cash equivalents totaled ~~$104.1 million on a consolidated basis.~~

~~Indebtedness~~~~: The Company had $3.0 million and $0 in investment debt as of June 30, 2022 and December 31, 2021, respectively.~~approximately $14,000.

We expect our cash on hand, ~~and~~ proceeds received from our assets and operations, cash flow from operations will be sufficient to meet our anticipated liquidity needs for business operations for the next twelve months. There can be no assurance that we will continue to generate cash flows at or above current levels or that we will be able to raise additional financing to support our parent company’s operating and compliance expenditures.

~~Table of Contents~~

Our cash flows could be adversely affected by events outside our control, including, without limitation, changes in overall economic conditions, regulatory requirements, changes in technologies, demand for our products and services, availability of labor resources and capital, natural disasters, pandemics and outbreaks of contagious diseases and other adverse public health developments, such as COVID-19, and other conditions. Our ability to attract and maintain a sufficient customer base, particularly in our principal markets, is critical to our ability to maintain a positive cash flow from operations. The foregoing events individually or collectively could affect our results.

~~We are evaluating the impact of current market conditions on our Company and its ability to generate dollar-denominated income.~~ We believe that our operating cash flow and cash on hand will be sufficient to meet operating requirements and to finance routine capital expenditures through the next twelve months.

Off Balance Sheet Arrangements

None.

Dividends

On November 10, 2021, our Board adopted a Dividend Policy for the Company. The Policy provides a process that the Board will undertake when approving quarterly, annual, and special dividends for the Company including, but not limited to, various financial criteria and macroeconomic factors, as well as certain financial and economic factors specific to the Company. In the case of quarterly dividends, within ninety (90) calendar days following the end of each fiscal year, the Board will determine the dividend payment, if any, that will be made to holders of the Company’s capital stock. Such dividend will generally be expressed as a cash amount equal to a percentage of the Company’s consolidated after-tax net income for such prior fiscal year, and will be divided into fourths, with one-fourth of the amount payable each quarter. As of June 30, 2023, the Company has not paid any dividends in its history.

Subsequent Events

Our Management performed an evaluation of the Company’s activity through the date the financial statements were issued, noting the following subsequent event:

~~Entry~~On July 27, 2023, we converted our holding of TIO Series A Preferred Stock into ~~Second Amended and Restated Merger Agreement~~~~. As described above in Note 2 –~~ ~~Entry Into Restated Merger Agreement with MICT~~~~, on October 6, 2022, the Company, MICT, and representatives~~26,042,808 shares of ~~each company’s shareholders entered into the Restated Merger Agreement.~~

TIO common stock.

3024

Table of Contents

Item 3.
~~Item 3.~~Quantitative and Qualitative Disclosure about Market Risk
We are subject to financial market risks, including changes in interest rates, lease rates, credit rates, and general debt terms.
We are subject to risks regarding currency volatility and foreign exchange rates. In particular, we are subject to fluctuations in foreign exchange rates between the U.S. dollar, our reporting currency, and currencies of countries where we market or source our products and ~~services, which presently consists principally of the Nigerian Naira.~~services. Such fluctuations may result in significant increases or decreases in our reported revenue and other results as expressed in dollars, and in the reported value of our assets, liabilities and cash flows. In addition, currency fluctuation may adversely affect receivables, payables, debt, firm commitments and forecast transactions denominated in non-U.S. currencies. In particular, transition risks arise where parts of the cost of sales are not denominated in the same currency of such sales. We currently do not hedge this exposure. Fluctuation in exchange rates, depreciation of local currencies, changes in monetary and/or fiscal policy or inflation in the countries in which we operate could have a material adverse effect on our business, financial condition, results of operations and prospects.
In addition to foreign currency risk, our ability to generate operating cash flows at our parent company level depends on the ability of our subsidiaries to upstream funds. ~~Nigeria and other countries~~Countries in which we may operate have exchange controls that can, from time to time, place restrictions on the exchange of local currency for foreign currency and the transfer of funds abroad. These controls and other controls that may be implemented in the future could limit the ability of our subsidiaries to transfer cash to us and make us dependent upon external sources of cash and credit.
We can offer no assurance that additional restrictions on currency exchange will not be implemented in the future or that these restrictions will not limit the ability of our subsidiaries to transfer cash to us, which could have a material adverse effect on our business, financial condition, results of operations and prospects.

Item 4.
~~Item 4.~~Controls and Procedures
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are made only in accordance with authorizations of our management and directors; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.
~~Management assessed~~Our management, with the participation of our Company’s Chief Executive Officer and Chief Financial Officer, have evaluated the effectiveness of the design and operations of the Company’s “disclosure controls and procedures” (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934) as of June 30, 2023. Based on their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective at a reasonable assurance level. There has been no change in our internal control over financial reporting ~~as of~~during the quarter ended June 30, 2022. In making this assessment, management used the criteria set forth in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in 2013.
~~Based upon our evaluation of internal controls, our CEO and CFO determined~~2023, that ~~(i) we have a material weakness over our entity level control environment as of June 30, 2022 and (ii)~~has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting was not effective as of June 30, 2022, inasmuch as, subsequent to quarter-end, we recharacterized the acquisition of Tingo Mobile as a reverse acquisition under applicable accounting rules and amended and restated our financial statements in previous quarterly and annual reports accordingly.reporting.

3125

Table of Contents

Part II.Other Information
Item 1.~~Legal Proceedings~~
On May 23, 2022, ClearThink Capital LLC, a Florida limited liability company claiming to be an investment banking firm (“ClearThink”), filed a complaint against the Company alleging a breach by Tingo of a purported non-circumvention agreement and an alleged obligation to pay ClearThink an investment banking fee in connection with the planned merger of the Company with a wholly-owned subsidiary of MICT, Inc. The lawsuit seeks relief for breach of contract, a breach of the covenant of good faith and fair dealing, and unjust enrichment, and also seeks declaratory relief, injunctive relief, and an award of costs, attorneys’ fees, and expenses. We believe that this lawsuit, and the allegations included therein, are without merit, particularly in view of the fact that ClearThink and its Managing Director, Craig Marshak, failed to disclose to Tingo their lack of a required broker-dealer license, or that Robert S. Brown, the Chief Executive Officer of ClearThink, was subject to an Order from the SEC suspending him from practicing before the Commission. While the outcome of the lawsuit cannot at this time be predicted with certainty, we do not expect that the proceeding will have a material effect upon Tingo’s financial condition or results of operations.
Legal Proceedings
From time to time, the Company is a party to certain ~~other~~ proceedings incidental to the normal course of our business including the enforcement of our rights under contracts with our customers and subscribers. While the outcome of these legal proceedings cannot at this time be predicted with certainty, we do not expect that these proceedings will have a material effect upon the Company’s financial condition or results of operations.

Item 1A.Risk Factors
In connection with our ~~acquisition~~sale of Tingo Mobile and as a ~~public~~temporary investment company ~~focused on the agri-fintech sector,~~following such sale, we are subject to a number of risks, many of which are identified in our Annual Report on Form 10-K ~~including~~and any subsequent amendments thereto (“10-K”). As the business of the Company and its subsidiaries continues to develop, ~~and as we progress toward completion of the merger,~~ we intend to identify, as will be reasonably possible, any such additional risks and include the same in our subsequent filings and reports with the SEC.
Moreover, the economic dislocation precipitated by the coronavirus pandemic is still rapidly evolving. As of the date of filing of this 10-Q, we are unable to predict either the potential near-term or longer-term impact that the coronavirus may have on our financial and operating results due to numerous uncertainties regarding the duration and severity of the crisis. To the greatest extent possible, we intend to operate our business in the ordinary course. Nevertheless, the ultimate impact of the coronavirus pandemic is highly uncertain and subject to change, and our business, results of operations, and financial condition have been and will likely continue to be impacted by future developments concerning the pandemic and the resulting economic disruption.
Readers should carefully consider these risks and all other information contained in our 10-K, including the Company’s financial statements and the related notes thereto. The risks and uncertainties described in our 10-K and throughout this 10-Q are not the only ones facing the Company.
Additional risks and uncertainties not presently known to us, or not presently deemed material by us, may also impair our operations and ~~performance~~.performance.
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds
None.

Item 3.Defaults Upon Senior Securities
None.

Item 4.Mine Safety Disclosures
Not Applicable.

Item 5.Other Information
Not Applicable.

3226

Table of Contents

Item 6.Exhibits
3.

Articles of Incorporation or Bylaws

(a)
Amended and Restated Articles of Incorporation of the Company. [Incorporated by reference to Exhibit 3(i) to Registrant’s Current Report on Form 8-K filed on ~~October 20, 2021]~~April 27, 2023]
(b)
Amended and Restated Bylaws of the Company [Incorporated by reference to Exhibit 3(ii) to Registrant’s Current Report on Form 8-K filed on September 16, 2021]
~~(c)~~
Acquisition Agreement, dated July 29, 2021, among the Company, Tingo International Holdings, Inc., and Tingo Mobile PLC. [Incorporated by reference to Exhibit 2.1 to Registrant’s Current Report on Form 8-K filed on August 4, 2021.]
10.

Material Contracts

(a)
Form of Indemnification Agreement between the Company and its directors and certain officers. [Incorporated by reference to Exhibit 10(a) to Registrant’s ~~Amendment No. 1 to~~ Quarterly Report on Form 10-Q/A filed on July 21, 2022]
(b)
Code of Business Conduct and Ethics. [Incorporated by reference to Exhibit 14.1 to Registrant’s Current Report on Form 8-K filed on October 20, 2021]
(c)
2021 Equity Incentive Plan. [Incorporated by reference to Exhibit 10.1 to Registrant’s Registration Statement on Form S-8, filed on October 12, 2021.]

(d)
Second Amended and Restated Agreement and Plan of Merger among the Company, MICT, Inc., and representatives of the shareholders of the Company and MICT, ~~Merger Sub,~~ Inc. [Incorporated by reference to Exhibit 2.1 to Registrant’s Current Report on Form ~~8-K,~~8-K/A, filed on ~~June~~October 15, 2022.]
31.

Rule 13a-14(a)/15d-14(a) Certifications

1.
Certification by Chief Executive Officer*
2.
Certification by Chief Financial Officer*

32.

Rule 1350 Certifications

1.
Certification by Chief Executive Officer*

2.
Certification by Chief Financial Officer*

101.INS

Formatted in Inline XBRL (Extensible Business Reporting Language) (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL 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
** The certifications furnished in Exhibits 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q are deemed furnished and not filed with the Securities and Exchange Commission and are not to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Quarterly Report on Form 10-Q, irrespective of any general incorporation language contained in such filing.

3327

Table of Contents

SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has caused this report to be signed by the undersigned, thereunto duly authorized.
Dated: ~~November 16, 2022~~August 14, 2023

~~TINGO,~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc.)

/s/Dozy Mmobuosi

Dozy Mmobuosi

Chief Executive Officer

3428


	June 30, 2022		December 31, 2021

Trade and other receivable gross	$	318,749,400	$	364,350,175
Allowance for expected credit loss		(5,660)		(42,065)
		318,743,740		364,308,110
Directors current account		—		289
	$	318,743,740	$	364,308,399


			MOTOR	FURNITURE &	OFFICE	PLANT &	SITE	MOBILE
	LAND	BUILDING	VEHICLES	FITTINGS	EQUIPMENT	MACHINERY	INSTALLATIONS	DEVICES	Total
	$	$	$	$	$	$	$	$	$
COST
December 31, 2021	8,794,695	31,774,624	207,709	60,009	66,142	10,112,085	191,316,838	1,219,411,221	1,461,743,324
ADDITIONS	—	—	—	—	—	—	—	—	—
Forex translation difference	(36,687)	(132,549)	(866)	(250)	(276)	(42,182)	(798,076)	—	(1,010,886)
June 30, 2022	8,758,008	31,642,075	206,844	59,759	65,866	10,069,903	190,518,762	1,219,411,221	1,460,732,438

DEPRECIATION
December 31, 2021	—	8,246,459	126,507	41,444	62,662	10,092,916	—	244,290,317	262,860,305
CHARGED FOR THE YEAR	—	810,705	13,412	3,222	1,135	4,486	9,545,848	202,688,055	213,048,863
Forex translation difference	—	(36,128)	(556)	(180)	(264)	(42,112)	(19,910)	—	(99,150)
June 30, 2022	—	9,021,036	139,363	44,486	63,533	10,055,290	9,525,938	446,978,372	475,810,018

NET BOOK VALUE
December 31, 2021	8,794,695	23,510,165	81,202	18,565	3,480	19,169	191,316,838	975,120,904	1,198,883,019
June 30, 2022	8,758,008	22,621,040	67,480	15,273	2,333	14,613	180,992,824	772,432,849	984,922,420


Cost
As of January 1, 2022	$	6,193,507
Additions		—
Forex translation difference		(519,680)
As of June 30, 2022		5,673,827

Amortization
As of January 1, 2022		4,026,671
Charge for the period		568,569
Forex translation difference		(17,984)
As of June 30, 2022		4,577,256

Carrying Amount as of June 30, 2022	$	1,096,571


	June 30, 2022		December 31, 2021
Trade payables	$	99,260,527	$	754,709,170
Accrued compensation		2,135,389		1,049,029
Accrued interest		19,726		—
Other payables		(86,806)		126,994
Total Accounts Payable and Accruals	$	101,328,836	$	755,885,193


	June 30, 2022		December 31, 2021
Due within one year	$	298,262,348	$	221,215,018
Over one year		—		—
Total Deferred income		298,262,348		221,215,018

Deferred income - current portion		298,262,348		221,215,018
Deferred income - non-current portion		—		—
Total Deferred income	$	298,262,348	$	221,215,018


	June 30, 2022		June 30, 2021
Income tax⁽¹⁾	$	82,765,443	$	27,530,801
Education tax		5,517,696		1,835,387
Current Tax	$	88,283,139	$	29,366,188


Current Tax Liabilities	June 30, 2022		December 31, 2021
Beginning of period	$	100,606,352	$	67,601,594
Charge for the period⁽¹⁾		88,283,139		104,802,090
		188,889,491		172,403,684
Paid during the period		(100,262,236)		(62,946,048)
Forex translation difference		(664,890)		(8,851,284)

Total Current Tax Liabilites	$	87,962,365	$	100,606,352


Deferred Tax	June 30, 2022		December 31, 2021
Beginning of period	$	2,171,039	$	2,360,004
Change for the period		2,184,276		—
Forex translation difference		(18,168)		(188,965)
Total Deferred Tax Liabilities	$	4,337,147	$	2,171,039


	Three Months Ended
			% of				% of
(in Thousands)	June 30, 2022		Revenue		June 30, 2021		Revenue
Revenue	$	268,685	—		$	100,731	—
Operating Expense		(146,662)	54.58	%		(49,724)	49.36	%
Operating Income		122,023	45.42	%		51,007	50.64	%

Other Income, net		114	—			80	—
Income before taxes		122,138	45.46	%		51,087	50.72	%
Income tax⁽¹⁾		(49,584)				(16,348)
Income from continuing operations		72,553	27.00	%		34,739	34.49	%
Net Income	$	72,553	27.00	%	$	34,739	34.49	%

3.	Articles of Incorporation or Bylaws
	(a)	Amended and Restated Articles of Incorporation of the Company. [Incorporated by reference to Exhibit 3(i) to Registrant’s Current Report on Form 8-K filed on ~~October 20, 2021]~~April 27, 2023]
			(b)	Amended and Restated Bylaws of the Company [Incorporated by reference to Exhibit 3(ii) to Registrant’s Current Report on Form 8-K filed on September 16, 2021]
	~~(c)~~	Acquisition Agreement, dated July 29, 2021, among the Company, Tingo International Holdings, Inc., and Tingo Mobile PLC. [Incorporated by reference to Exhibit 2.1 to Registrant’s Current Report on Form 8-K filed on August 4, 2021.]
10.	Material Contracts
	(a)	Form of Indemnification Agreement between the Company and its directors and certain officers. [Incorporated by reference to Exhibit 10(a) to Registrant’s ~~Amendment No. 1 to~~ Quarterly Report on Form 10-Q/A filed on July 21, 2022]
			(b)	Code of Business Conduct and Ethics. [Incorporated by reference to Exhibit 14.1 to Registrant’s Current Report on Form 8-K filed on October 20, 2021]
			(c)	2021 Equity Incentive Plan. [Incorporated by reference to Exhibit 10.1 to Registrant’s Registration Statement on Form S-8, filed on October 12, 2021.]
	(d)	Second Amended and Restated Agreement and Plan of Merger among the Company, MICT, Inc., and representatives of the shareholders of the Company and MICT, ~~Merger Sub,~~ Inc. [Incorporated by reference to Exhibit 2.1 to Registrant’s Current Report on Form ~~8-K,~~8-K/A, filed on ~~June~~October 15, 2022.]
31.	Rule 13a-14(a)/15d-14(a) Certifications
	1.	Certification by Chief Executive Officer*
			2.	Certification by Chief Financial Officer*

32.	Rule 1350 Certifications
	1.	Certification by Chief Executive Officer*
	2.	Certification by Chief Financial Officer*

101.INS	Formatted in Inline XBRL (Extensible Business Reporting Language) (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL 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).

	~~TINGO,~~AGRI-FINTECH HOLDINGS, INC. (f/k/a Tingo, Inc.)

	/s/Dozy Mmobuosi
	Dozy Mmobuosi
	Chief Executive Officer