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What changed in Cheer Holding, Inc.'s 20-F — 2024 vs 2025

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Paragraph-level year-over-year comparison of Cheer Holding, Inc.'s 2024 and 2025 20-F annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+471 added−459 removedSource: 20-F (2026-03-20) vs 20-F (2025-03-10)

Top changes in Cheer Holding, Inc.'s 2025 20-F

471 paragraphs added · 459 removed · 335 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

153 edited+44 added−43 removed509 unchanged
Biggest changeIn addition, in the future, if any of our acquisitions were subject to the M&A Rules and were found not to be in compliance with the requirements of the M&A Rules, relevant PRC regulatory agencies may impose fines and penalties on our operations in the PRC, limit our operating privileges in the PRC, or take other actions that could have a material adverse effect on our business, financial condition, results of operations, reputation and prospects. 29 PRC regulations relating to offshore investment activities by PRC residents and PRC citizens may increase the administrative burden we face and may subject our PRC resident beneficial owners or employees who are share option holders to personal liabilities, limit our subsidiary’s abilities to increase our registered capital or distribute profits to us, limit our ability to inject capital into our PRC subsidiary, or may otherwise expose us to liability under PRC law.
Biggest changePRC regulations relating to offshore investment activities by PRC residents and PRC citizens may increase the administrative burden we face and may subject our PRC resident beneficial owners or employees who are share option holders to personal liabilities, limit our subsidiary’s abilities to increase our registered capital or distribute profits to us, limit our ability to inject capital into our PRC subsidiary, or may otherwise expose us to liability under PRC law.
If we are not able to compete effectively for highly qualified personnel or attract and retain top talent at reasonable costs, our original content production capabilities would be materially and adversely impacted.
If we are not able to compete effectively for highly qualified personnel or attract and retain top talent at reasonable costs, our original content production capabilities would be materially and adversely impacted.
While we take various measures to comply with all applicable data privacy and protection laws and regulations, there is no guarantee that our current security measures and those of our third-party service providers may always be adequate for the protection of our customer, employee or company data; and like all companies, we may experience data incidents from time to time.
While we take various measures to comply with applicable data privacy and protection laws and regulations, there is no guarantee that our current security measures and those of our third-party service providers may always be adequate for the protection of our customer, employee or company data; and like all companies, we may experience data incidents from time to time.
In particular, we face a number of challenges relating to data from transactions and other activities on our platform, including: ● protecting the data in and hosted on our system, including against attacks on our system by outside parties or fraudulent behavior by our employees; ● addressing concerns related to privacy and sharing, safety, security and other factors; and ● complying with applicable laws, rules and regulations relating to the collection, use, disclosure or security of personal information, including any requests from regulatory and government authorities relating to such data.
In particular, we face a number of challenges relating to data from transactions and other activities on our platform, including: ● protecting the data in and hosted on our system, including against attacks on our system by outside parties or fraudulent behavior by our employees; 8 ● addressing concerns related to privacy and sharing, safety, security and other factors; and ● complying with applicable laws, rules and regulations relating to the collection, use, disclosure or security of personal information, including any requests from regulatory and government authorities relating to such data.
The rule establishes “a framework for the PCAOB’s determinations under the HFCAA (as amended by the Consolidated Appropriation Act, 2023) that the PCAOB is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by an authority in that jurisdiction.” On December 2, 2021, SEC has announced the adoption of amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA.
The rule establishes “a framework for the PCAOB’s determinations under the HFCAA (as amended by the Consolidated Appropriation Act, 2023) that the PCAOB is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by an authority in that jurisdiction.” 42 On December 2, 2021, SEC has announced the adoption of amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA.
If we are unable to offer popular original content that addresses our user’s tastes and preferences in a cost effective manner, we may suffer a reduction in user traffic and our business, financial condition and results of operations may be materially and adversely affected. 9 Our future success also depends upon our ability to attract and retain highly qualified management personnel.
If we are unable to offer popular original content that addresses our user’s tastes and preferences in a cost effective manner, we may suffer a reduction in user traffic and our business, financial condition and results of operations may be materially and adversely affected. Our future success also depends upon our ability to attract and retain highly qualified management personnel.
Compliance with existing and potential government regulation of AI, may require significant resources, including to develop, test and maintain platforms, offerings, services, and features to help us implement AI in accordance with applicable law, and to minimize other adverse effect on our results of operations. Developing, testing, and deploying resource-intensive AI systems may require additional investment and increase our costs.
Compliance with existing and potential government regulation of AI, may require significant resources, including to develop, test and maintain platforms, offerings, services, and features to help us implement AI in accordance with applicable law, and to minimize other adverse effect on our results of operations. 7 Developing, testing, and deploying resource-intensive AI systems may require additional investment and increase our costs.
If development or launches are delayed and we are unable to continue our investment into our metaverse platform and Metaverse Experience Centers, our ability to grow revenue and our financial performance will be negatively impacted. Implementation of AI and machine learning technologies may result in legal and regulatory risks, reputational harm or have other adverse consequences to our business.
If development or launches are delayed and we are unable to continue our investment into our metaverse platform and Metaverse Experience Centers, our ability to grow revenue and our financial performance will be negatively impacted. 14 Implementation of AI and machine learning technologies may result in legal and regulatory risks, reputational harm or have other adverse consequences to our business.
In the event that we elect to rely on one or more of these exemptions, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements. The trading prices of our Class A Ordinary Shares are likely to be volatile, which could result in substantial losses to our shareholders and investors.
In the event that we elect to rely on one or more of these exemptions, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements. 40 The trading prices of our Class A Ordinary Shares are likely to be volatile, which could result in substantial losses to our shareholders and investors.
If we are unable to provide enhancements and new features and integrations for our existing platform, develop new products that achieve market acceptance, or innovate quickly enough to keep pace with these rapid technological developments may adversely impact our business and operations. Our business depends on the continuing efforts of our management.
If we are unable to provide enhancements and new features and integrations for our existing platform, develop new products that achieve market acceptance, or innovate quickly enough to keep pace with these rapid technological developments may adversely impact our business and operations. 24 Our business depends on the continuing efforts of our management.
Also, such a delisting would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material adverse impact on our business, financial condition and prospects. Future sales or other dilution of our equity could depress the market price of our Class A Ordinary Shares.
Also, such a delisting would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material adverse impact on our business, financial condition and prospects. 43 Future sales or other dilution of our equity could depress the market price of our Class A Ordinary Shares.
If we do not realize the expected benefits of our investments, our business, financial condition, results of operations and prospects may be harmed. 6 Our business generates and processes a large amount of data, and the improper use or disclosure of such data could harm our reputation as well as have a material adverse effect on our business and prospects.
If we do not realize the expected benefits of our investments, our business, financial condition, results of operations and prospects may be harmed. Our business generates and processes a large amount of data, and the improper use or disclosure of such data could harm our reputation as well as have a material adverse effect on our business and prospects.
In addition, our business, financial condition or results of operations could be materially and adversely affected to the extent that any of these epidemics harms the Chinese economy in general. Our semi-annual operating results may fluctuate, which makes our results of operations difficult to predict and may cause our quarterly results of operations to fall short of expectations.
In addition, our business, financial condition or results of operations could be materially and adversely affected to the extent that any of these epidemics harms the Chinese economy in general. 11 Our semi-annual operating results may fluctuate, which makes our results of operations difficult to predict and may cause our quarterly results of operations to fall short of expectations.
Should any bank or trust company holding our cash deposits become insolvent, or if we are otherwise unable to withdraw funds, we could lose the cash on deposit with that particular bank or trust company or have our account frozen. Our failure to protect our intellectual property rights could have a negative impact on our business.
Should any bank or trust company holding our cash deposits become insolvent, or if we are otherwise unable to withdraw funds, we could lose the cash on deposit with that particular bank or trust company or have our account frozen. 12 Our failure to protect our intellectual property rights could have a negative impact on our business.
As a result, we may be unable to consolidate Horgos and Xing Cui Can in our consolidated financial statements, which could materially and adversely affect our financial condition and results of operations. Our VIE Contracts may be subject to scrutiny by the PRC tax authorities and additional taxes may be imposed.
As a result, we may be unable to consolidate Horgos and Xing Cui Can in our consolidated financial statements, which could materially and adversely affect our financial condition and results of operations. 18 Our VIE Contracts may be subject to scrutiny by the PRC tax authorities and additional taxes may be imposed.
As a result, these uncertainties could materially and adversely affect our business and operations. Substantial uncertainties in relation to the regulatory administration and governmental policies of NFTs and metaverse could have a significant impact upon the cost, performance and prospect of the operation of the NFTs and metaverse related businesses in which we will engage in the future.
As a result, these uncertainties could materially and adversely affect our business and operations. Substantial uncertainties in relation to the regulatory administration and governmental policies of the metaverse could have a significant impact upon the cost, performance and prospect of the operation of the metaverse related businesses in which we will engage in the future.
If we are unable to attract significant numbers of new mobile buyers and increase levels of mobile engagement, our ability to maintain or grow our business would be materially and adversely affected. Our business prospects and financial results may be impacted by our relationship with third-party platforms.
If we are unable to attract significant numbers of new mobile buyers and increase levels of mobile engagement, our ability to maintain or grow our business would be materially and adversely affected. 5 Our business prospects and financial results may be impacted by our relationship with third-party platforms.
We currently rely on third-party service providers for certain aspects of our operations, and any interruptions in services provided by these third parties may impair our ability to support our users and develop platforms. Our success depends in part on our relationships with other third-party service providers.
We rely on third-party service providers for certain aspects of our operations, and any interruptions in services provided by these third parties may impair our ability to support our users and develop platforms. Our success depends in part on our relationships with other third-party service providers.
Moreover, new laws or regulations with respects to the NFTs or metaverse could subject us to substantial costs to comply those rules, or penalties, suspension or even termination of those businesses in the event of we fail to comply with those rules, which could substantially affect our cost, performance and prospect of those businesses.
Moreover, new laws or regulations with respects to the metaverse could subject us to substantial costs to comply those rules, or penalties, suspension or even termination of those businesses in the event of we fail to comply with those rules, which could substantially affect our cost, performance and prospect of those businesses.
This may restrict our ability to implement our acquisition strategy and could adversely affect our business and prospects. 24 As an offshore holding company with PRC subsidiaries, we may transfer funds to our operating entity or finance our operating entity by means of loans or capital contributions.
This may restrict our ability to implement our acquisition strategy and could adversely affect our business and prospects. As an offshore holding company with PRC subsidiaries, we may transfer funds to our operating entity or finance our operating entity by means of loans or capital contributions.
Prior court decisions are encouraged to be used for reference but it remains unclear to what extent the prior court decisions may impact the current court ruling as the encouragement policy is new and there is limited judicial practice in this regard.
Prior court decisions are encouraged to be used for reference but it remains unclear to what extent the prior court decisions may impact the current court ruling as the encouragement policy is relatively new and there is limited judicial practice in this regard.
We cannot be certain that the equity interest will be disposed of in accordance with the VIE Contracts. In addition, new PRC laws, rules and regulations may be introduced to impose additional requirements that may impose additional challenges to our corporate structure and VIE Contracts.
We cannot be certain that the equity interest will be disposed of in accordance with the VIE Contracts. In addition, new PRC laws, rules and regulations may be introduced to impose additional requirements that may bring additional challenges to our corporate structure and VIE Contracts.
We cannot be certain that our licensors are not infringing the intellectual property rights of others or that the suppliers and licensors have sufficient rights to the artwork and related technology in all jurisdictions in which we may operate.
In addition, we cannot be certain that our licensors are not infringing the intellectual property rights of others or that the suppliers and licensors have sufficient rights to the artwork and related technology in all jurisdictions in which we may operate.
These risks may be exacerbated in the event of a prolonged economic downturn or financial crisis. 21 A severe and prolonged global economic recession and the slowdown in the Chinese economy may adversely affect our business, results of operations and financial condition.
These risks may be exacerbated in the event of a prolonged economic downturn or financial crisis. A severe and prolonged global economic recession and the slowdown in the Chinese economy may adversely affect our business, results of operations and financial condition.
If we are unable to maintain effective internal control over financial reporting, our ability to record, process and report financial information timely and accurately could be adversely affected, which could subject us to litigation or investigations, require management resources, increase our expenses, negatively affect investor confidence in our financial statements and adversely impact our stock price. 39 Certain judgments obtained against the Company by our shareholders may not be enforceable.
If we are unable to maintain effective internal control over financial reporting, our ability to record, process and report financial information timely and accurately could be adversely affected, which could subject us to litigation or investigations, require management resources, increase our expenses, negatively affect investor confidence in our financial statements and adversely impact our stock price. 45 Certain judgments obtained against the Company by our shareholders may not be enforceable.
Such uncertainties, including uncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights, could materially and adversely affect our business and impede our ability to continue our operations. 31 Furthermore, if China adopts more stringent standards with respect to environmental protection or corporate social responsibilities, we may incur increased compliance costs or become subject to additional restrictions in our operations.
Such uncertainties, including uncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights, could materially and adversely affect our business and impede our ability to continue our operations. 36 Furthermore, if China adopts more stringent standards with respect to environmental protection or corporate social responsibilities, we may incur increased compliance costs or become subject to additional restrictions in our operations.
In the event that the NFTs and metaverse assets owned by our customers or us are subject to infringement, theft or other adverse effects without proper legal remedies, our business operation of those businesses and/or our reputation could be adversely affected. Delays in issuing invoices due to China taxing authorities may materially and adversely affect our cash flow.
In the event that the metaverse assets owned by our customers or us are subject to infringement, theft or other adverse effects without proper legal remedies, our business operation of those businesses and/or our reputation could be adversely affected. 23 Delays in issuing invoices due to China taxing authorities may materially and adversely affect our cash flow.
While the NFTs and metaverse have been rapidly developing businesses in China with more and more market participants, few laws or regulations has been promulgated in this regard.
While the metaverse have been rapidly developing businesses in China with more and more market participants, few laws or regulations has been promulgated in this regard.
Our VIEs and their subsidiaries may be subject to network data security review by the CAC if our VIEs or their subsidiaries are recognized as network data processors which conduct data processing activities that affect or may affect national security. 26 In recent years, certain internet platforms in China have been reportedly subject to heightened regulatory scrutiny in relation to cybersecurity matters.
Our VIEs and their subsidiaries may be subject to network data security review by the CAC if our VIEs or their subsidiaries are recognized as network data processors which conduct data processing activities that affect or may affect national security. 30 In recent years, certain internet platforms in China have been reportedly subject to heightened regulatory scrutiny in relation to cybersecurity matters.
We act as agent for our clients in dealing with television channels, or other media on whose platform our clients want to display their advertisements. Under our agreements with television channels or other media, we are typically responsible for the compliance with applicable laws, rules and regulations with respect to advertising content that it provide to the media.
We act as agent for our clients in dealing with television channels, or other media on whose platform our clients want to display their advertisements. Under our agreements with television channels or other media, we are typically responsible for the compliance with applicable laws, rules and regulations with respect to advertising content that it provides to the media.
Violations or alleged violations of the content requirements could also harm our reputation and impair our ability to conduct and expand our business. 19 Uncertainties in the interpretation and enforcement of PRC laws and regulations could limit the legal protections available to us. The PRC legal system is a civil law system based on written statutes.
Violations or alleged violations of the content requirements could also harm our reputation and impair our ability to conduct and expand our business. 22 Uncertainties in the interpretation and enforcement of PRC laws and regulations could limit the legal protections available to us. The PRC legal system is a civil law system based on written statutes.
In 1979, the PRC government began to promulgate a comprehensive system of laws and regulations governing economic matters in general, such as foreign investment, corporate organization and governance, commerce, taxation and trade. As a significant part of our business is conducted in China, our operations are principally governed by PRC laws and regulations.
In 1979, the PRC government began to develop a comprehensive system of laws and regulations governing economic matters in general, such as foreign investment, corporate organization and governance, commerce, taxation and trade. As a significant part of our business is conducted in China, our operations are principally governed by PRC laws and regulations.
You should consider our prospects in light of the risks and uncertainties fast-growing companies with limited operating histories in a fast evolving industry. 3 We may not be able to manage our growth effectively. We continue to experience periods of rapid growth since we launched our services in 2016.
You should consider our prospects in light of the risks and uncertainties fast-growing companies with limited operating histories in a fast evolving industry. 4 We may not be able to manage our growth effectively. We continue to experience periods of rapid growth since we launched our services in 2016.
Since 1979, the Chinese government began to promulgate a comprehensive system of laws that regulate economic affairs in general, deal with economic matters such as foreign investment, corporate organization and governance, commerce, taxation and trade, as well as encourage foreign investment in China.
Since 1979, the Chinese government began to develop a comprehensive system of laws that regulate economic affairs in general, deal with economic matters such as foreign investment, corporate organization and governance, commerce, taxation and trade, as well as encourage foreign investment in China.
As a result, the market price of our securities may be depressed, and you may find it more difficult to sell our securities. 40 We were a “shell company” and are subject to additional restrictions under Rule 144 on resales of our restricted securities.
As a result, the market price of our securities may be depressed, and you may find it more difficult to sell our securities. 46 We were a “shell company” and are subject to additional restrictions under Rule 144 on resales of our restricted securities.
In light of China’s recent announcements, there are risks and uncertainties which we cannot foresee for the time being, and rules and regulations in China can change quickly with little or no advance notice.
In light of the foregoing China’s announcements, there are risks and uncertainties which we cannot foresee for the time being, and rules and regulations in China can change quickly with little or no advance notice.
Organizational Structure.” The VIE accounts for majority of the Company’s consolidated results of operations and cash flows for the years ended December 31, 2024, 2023 and 2022, respectively. As of December 31, 2024 and 2023, the VIE accounted for majority of the consolidated total assets and total liabilities of the Company.
Organizational Structure.” The VIE accounts for majority of the Company’s consolidated results of operations and cash flows for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025 and 2024, the VIE accounted for majority of the consolidated total assets and total liabilities of the Company.
We use artificial intelligence (including generative artificial intelligence), machine learning, data science and similar technologies (collectively, “AI”) in our technology and infrastructure, which may become more important in our operations over time. We are increasingly utilizing AI technology and our AI content creation platform, CHEERS Telepathy, in our products and ecosystem.
We use and expect to continue to use artificial intelligence (including generative artificial intelligence), machine learning, data science and similar technologies (collectively, “AI”) in our technology and infrastructure, which may become more important in our operations over time. We are increasingly utilizing AI technology and our AI content creation platform, CHEERS Telepathy, in our products and ecosystem.
Bing Zhang, our chairman of board of directors and chief executive officer, beneficially owns all of our Class B Ordinary Shares. As of December 31, 2024, these Class B Ordinary Shares constitutes approximately 81.1% of the aggregate voting power of our total issued and outstanding Ordinary Shares due to the disparate voting powers associated with our dual-class share structure.
Bing Zhang, our chairman of board of directors and chief executive officer, beneficially owns all of our Class B Ordinary Shares. As of December 31, 2024, these Class B Ordinary Shares constitutes approximately 91.5% of the aggregate voting power of our total issued and outstanding Ordinary Shares due to the disparate voting powers associated with our dual-class share structure.
This competition may make it more difficult and expensive to attract, hire and retain qualified managers and employees. Our controlling shareholder will have substantial influence over us. As of the date of this report, Happy Starlight Limited, which is controlled by Mr. Bing Zhang, our chairman, beneficially owns 1,895,287 of our Class A Ordinary Shares. In addition, Mr.
This competition may make it more difficult and expensive to attract, hire and retain qualified managers and employees. Our controlling shareholder will have substantial influence over us. As of the date of this report, Happy Starlight Limited, which is controlled by Mr. Bing Zhang, our chairman, beneficially owns 37,906 of our Class A Ordinary Shares. In addition, Mr.
Horgos, Horgos Glary Wisdom Marketing Planning Co., Ltd., Horgos Glary Prosperity Culture Co., Ltd., were eligible to be exempted from income tax from 2017 to 2020, and enjoy a preferential income tax rate of 15% that are expected to last from 2021 to 2025.
Horgos and Horgos Glary Prosperity Culture Co., Ltd., were eligible to be exempted from income tax from 2017 to 2020, and enjoy a preferential income tax rate of 15% that are expected to last from 2021 to 2025.
Fluctuations in the foreign currency exchange rate between U.S. Dollars and Renminbi could adversely affect our financial condition. The value of the RMB against the U.S. dollar and other currencies may fluctuate. Exchange rates are affected by, among other things, changes in political and economic conditions and the foreign exchange policy adopted by the PRC government.
Dollars and Renminbi could adversely affect our financial condition. The value of the RMB against the U.S. dollar and other currencies may fluctuate. Exchange rates are affected by, among other things, changes in political and economic conditions and the foreign exchange policy adopted by the PRC government.
In the late 1970s, the PRC government began to promulgate a comprehensive system of laws and regulations governing economic matters in general. The overall effect of legislation over the past four decades has significantly increased the protections afforded to various forms of foreign or private-sector investment in the PRC.
In the late 1970s, the PRC government began to develop a comprehensive system of laws and regulations governing economic matters in general. The overall effect of legislation over the past several decades has significantly increased the protections afforded to various forms of foreign or private-sector investment in the PRC.
In addition, as there is no clear regulatory laws or regulations in relation to the NFTs and metaverse in China, the legal protection of NFTs and metaverse assets may not be as effective as those of other properties.
In addition, as there is no clear regulatory laws or regulations in relation to the d metaverse in China, the legal protection of metaverse assets may not be as effective as those of other properties.
Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on our business and operating results. The M&A Rules set forth complex procedures for acquisitions conducted by foreign investors, which could make it more difficult to pursue growth through acquisitions.
Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on our business and operating results. 33 The M&A Rules and certain other PRC regulations set forth complex procedures for acquisitions conducted by foreign investors, which could make it more difficult to pursue growth through acquisitions.
Currently, there is no generally recognized anti-viral treatment for COVID-19. While such restrictive measures have been gradually lifted, relaxation of restrictions on economic and social life may lead to new cases which may lead to the re-imposition of restrictions.
Currently, there is no generally recognized anti-viral treatment for COVID-19. While such restrictive measures have been gradually lifted, relaxation of restrictions on economic and social life may lead to new cases which may lead to the re-imposition of restrictions. Re-imposition of restrictive measures could adversely affect our operations.
Comparing with the Draft Foreign Investment Law of the People’s Republic of China published in 2015, the Foreign Investment Law does not include the following expression of ‘control or acquire equities of an enterprise within the territory of China through contractual arrangements, including but not limited to contracts and trust agreements.’ Whether the offshore companies controlled by the PRC investors through variable interest entities structure will be deemed a foreign investment remains to be seen.
Comparing with the Draft Foreign Investment Law of the People’s Republic of China published in 2015, the Foreign Investment Law does not include the following expression of ‘control or acquire equities of an enterprise within the territory of China through contractual arrangements, including but not limited to contracts and trust agreements.’ Whether the offshore companies controlled by the PRC investors through variable interest entities structure will be deemed a foreign investment remains to be seen. 26 Fluctuations in the foreign currency exchange rate between U.S.
Our proposed Metaverse platform is currently under development. It is our intent that our Metaverse platform will feature a virtual world containing immersive experiences in intelligent retail, video on demand, social networking, gaming and NFT, boasting a wide range of “online + offline” and “virtual + reality” scenarios.
It is our intent that our Metaverse platform will feature a virtual world containing immersive experiences in intelligent retail, video on demand, social networking, and gaming, boasting a wide range of “online + offline” and “virtual + reality” scenarios.
However, we may not be able to accurately assess the creditworthiness of each advertising customer or advertising agency, and any inability of advertising customers or advertising agencies to pay us for our services in a timely manner would negatively affect our liquidity and cash flows and may materially and adversely affect our business, financial condition and results of operations. 2 We operate in a highly competitive market and we may not be able to compete effectively.
However, we may not be able to accurately assess the creditworthiness of each advertising customer or advertising agency, and any inability of advertising customers or advertising agencies to pay us for our services in a timely manner would negatively affect our liquidity and cash flows and may materially and adversely affect our business, financial condition and results of operations.
In addition, there have been constant changes and amendments of laws and regulations over the past 40 years in order to keep up with the rapidly changing society and economy in China.
In addition, there have been constant changes and amendments of laws and regulations over the past several decades in order to keep up with the rapidly changing society and economy in China.
Our growth largely depends on our ability to innovate and add value to our existing creative platform and to provide our customers and contributors with a scalable, high-performing technology infrastructure that can efficiently and reliably handle increased customer and contributor usage globally, as well as the deployment of new features. For example, NFTs require additional capital and resources.
Our growth largely depends on our ability to innovate and add value to our existing creative platform and to provide our customers and contributors with a scalable, high-performing technology infrastructure that can efficiently and reliably handle increased customer and contributor usage globally, as well as the deployment of new features.
If we are found in violation of any PRC laws or regulations or if the VIE Contracts are determined as illegal or invalid by any PRC court, arbitral tribunal or regulatory authorities, the relevant governmental authorities would have broad discretion in dealing with such violation, including, without limitation: ● revoke the agreements constituting the VIE Contracts; ● revoke our business and operating licenses related to Horgos and Xing Cui Can’s value-added telecommunications services business and certain other businesses; ● require us to discontinue or restrict operations related to value-added telecommunications services business and certain other businesses; ● restrict our right to collect revenue generated from value-added telecommunications services business and certain other businesses; ● restrict or prohibit our use of the proceeds from overseas offering to finance Horgos and Xing Cui Can’s business and operations; ● levy fines on us and/or confiscate the proceeds that they deem to have been obtained through noncompliant operations; ● require us to restructure the operations in such a way as to compel us to establish a new enterprise, re-apply for the necessary licenses or relocate our businesses, staff and assets related to value-added telecommunications services business and certain other businesses; ● impose additional conditions or requirements with which we may not be able to comply; or ● take other regulatory or enforcement actions that could be harmful to our business. 15 Furthermore, any of the assets under the name of any record holder of equity interest in Horgos and Xing Cui Can, including such equity interest, may be put under court custody in connection with litigation, arbitration or other judicial or dispute resolution proceedings against that record holder.
If we are found in violation of any PRC laws or regulations or if the VIE Contracts are determined as illegal or invalid by any PRC court, arbitral tribunal or regulatory authorities, the relevant governmental authorities would have broad discretion in dealing with such violation, including, without limitation: ● revoke the agreements constituting the VIE Contracts; ● revoke our business and operating licenses related to Horgos and Xing Cui Can’s value-added telecommunications services business and certain other businesses; ● require us to discontinue or restrict operations related to value-added telecommunications services business and certain other businesses; 17 ● restrict our right to collect revenue generated from value-added telecommunications services business and certain other businesses; ● restrict or prohibit our use of the proceeds from overseas offering to finance Horgos and Xing Cui Can’s business and operations; ● levy fines on us and/or confiscate the proceeds that they deem to have been obtained through noncompliant operations; ● require us to restructure the operations in such a way as to compel us to establish a new enterprise, re-apply for the necessary licenses or relocate our businesses, staff and assets related to value-added telecommunications services business and certain other businesses; ● impose additional conditions or requirements with which we may not be able to comply; or ● take other regulatory or enforcement actions that could be harmful to our business.
In addition, securities markets may from time to time experience significant price and volume fluctuations that are not related to our operating performance, such as the large decline in share prices in the United States and other jurisdictions. 34 In addition to market and industry factors, the price and trading volume for our Class A Ordinary Shares may be highly volatile for factors specific to our own operations including the following: ● variations in our revenues, earnings and cash flow; ● announcements of new product and service offerings, investments, acquisitions, strategic partnerships, joint ventures, or capital commitments by us or our competitors; ● changes in the performance or market valuation of our company or our competitors; ● changes in financial estimates by securities analysts; ● changes in the number of our users and customers; ● fluctuations in our operating metrics; ● failures on our part to realize monetization opportunities as expected; ● additions or departures of our key management and personnel; ● release of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; ● detrimental negative publicity about us, our competitors or our industry; ● market conditions or regulatory developments affecting us or our industry; and ● potential litigation or regulatory investigations.
In addition to market and industry factors, the price and trading volume for our Class A Ordinary Shares may be highly volatile for factors specific to our own operations including the following: ● variations in our revenues, earnings and cash flow; ● announcements of new product and service offerings, investments, acquisitions, strategic partnerships, joint ventures, or capital commitments by us or our competitors; ● changes in the performance or market valuation of our company or our competitors; ● changes in financial estimates by securities analysts; ● changes in the number of our users and customers; ● fluctuations in our operating metrics; ● failures on our part to realize monetization opportunities as expected; ● additions or departures of our key management and personnel; ● release of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; ● detrimental negative publicity about us, our competitors or our industry; ● market conditions or regulatory developments affecting us or our industry; and ● potential litigation or regulatory investigations.
The approval, record filing and/or other requirements of China Securities Regulatory Commission (“the CSRC”) or other PRC governmental authorities may be required in connection with our contractual arrangement and overseas offering under PRC rules, regulations or policies, especially with the promulgation of the new filing-based administrative rules for overseas offering and listing by domestic companies in China, and, if required, we cannot predict whether or how soon we will be able to obtain such approval, complete the record filing or fulfil other governmental requirements.
As a result, our liquidity and our ability to fund and expand our business may be negatively affected. 28 The approval, record filing and/or other requirements of China Securities Regulatory Commission (“the CSRC”) or other PRC governmental authorities may be required in connection with our contractual arrangement and overseas offering under PRC rules, regulations or policies, especially with the promulgation of the new filing-based administrative rules for overseas offering and listing by domestic companies in China, and, if required, we cannot predict whether or how soon we will be able to obtain such approval, complete the record filing or fulfil other governmental requirements.
We cannot predict the effect our dual-class structure may have on the market of the Class A Ordinary Shares. We cannot predict whether our dual-class structure will result in a lower or more volatile market price of our Class A Ordinary Shares, in adverse publicity, or in other adverse consequences.
We cannot predict whether our dual-class structure will result in a lower or more volatile market price of our Class A Ordinary Shares, in adverse publicity, or in other adverse consequences.
Bing Zhang, our chairman of board of directors and chief executive officer, holds approximately 84.3% of our aggregate voting power, which is more than 50% of our total aggregate voting power of our Ordinary Shares for the election of directors through Happy Starlight Limited and his ownership of 100% of our issued and outstanding Class B Ordinary Shares.
Bing Zhang, our chairman of board of directors and chief executive officer, holds approximately 9.15% of our aggregate voting power, which is more than 50% of our total aggregate voting power of our Ordinary Shares for the election of directors through his ownership of 100% of our issued and outstanding Class B Ordinary Shares.
Zhang will have will have sufficient voting power to determine the outcome with respect to elections of directors, amendments to our Memorandum and Articles of Association that are subject to a stockholder vote, increases to the number of shares available for issuance under our equity incentive plans or adoption of new equity incentive plans, and approval of any merger, consolidation, sale of all or substantially all of our assets or other major corporate transaction requiring stockholder approval for the foreseeable future.
Zhang will have will have sufficient voting power to determine the outcome with respect to elections of directors, amendments to our Memorandum and Articles of Association that are subject to a stockholder vote, increases to the number of shares available for issuance under our equity incentive plans or adoption of new equity incentive plans, and approval of any merger, consolidation, sale of all or substantially all of our assets or other major corporate transaction requiring stockholder approval for the foreseeable future. 39 We cannot predict the effect our dual-class structure may have on the market of the Class A Ordinary Shares.
As a public company, we are subject to the Sarbanes-Oxley Act of 2002. Section 404 of the Sarbanes-Oxley Act, or Section 404, requires that we include a report from management on the effectiveness of our internal control over financial reporting in our annual report on Form 20-F.
Section 404 of the Sarbanes-Oxley Act, or Section 404, requires that we include a report from management on the effectiveness of our internal control over financial reporting in our annual report on Form 20-F.
We have been advised that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed by those provisions are penal in nature.
In addition, Cayman Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States. 44 We have been advised that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed by those provisions are penal in nature.
In the future, we may grow our business in part by acquiring complementary businesses. Complying with the requirements of this regulation to complete such transactions could be time-consuming, and any required approval processes, including obtaining approval from the MOFCOM, may delay or inhibit our ability to complete such transactions.
In the future, we may grow our business in part by acquiring complementary businesses. Complying with the requirements of those laws and regulations to complete such transactions could be time-consuming, and any required approval processes may delay or inhibit our ability to complete such transactions.
Senate passed the Accelerating Holding Foreign Companies Accountable Act (“AHFCAA”), which was enacted under the Consolidated Appropriations Act, 2023, as further described below. 36 On December 29, 2022, the Consolidated Appropriations Act, 2023, was signed into law, which amended the HFCAA (i) to reduce the number of consecutive years that would trigger delisting from three years to two years, and (ii) so that any foreign jurisdiction could be the reason why the PCAOB does not to have complete access to inspect or investigate a company’s auditors.
On December 29, 2022, the Consolidated Appropriations Act, 2023, was signed into law, which amended the HFCAA (i) to reduce the number of consecutive years that would trigger delisting from three years to two years, and (ii) so that any foreign jurisdiction could be the reason why the PCAOB does not to have complete access to inspect or investigate a company’s auditors.
In the event that we are unable to enforce the VIE Contracts, or if we suffer significant time delays or other obstacles in the process of enforcing them, it would be very difficult to effectively direct the activities of Horgos and Xing Cui Can, and our ability to conduct our business and our financial condition and results of operations may be materially and adversely affected.
In the event that we are unable to enforce the VIE Contracts, or if we suffer significant time delays or other obstacles in the process of enforcing them, it would be very difficult to effectively direct the activities of Horgos and Xing Cui Can, and our ability to conduct our business and our financial condition and results of operations may be materially and adversely affected. 19 If we exercise the option to acquire equity ownership of Horgos and Xing Cui Can, the ownership transfer may subject us to certain limitations and substantial costs.
We face significant competition in China in various sub-markets we operate, primarily from Alibaba (Nasdaq: BABA), Pin Duoduo (Nasdaq:PDD), Douyu (Nasdaq: DOYU), Mango Media (SZ.300413), and TVZone Media (SH.603721). We compete for users, usage time, advertising customers, and shoppers.
We operate in a highly competitive market and we may not be able to compete effectively. We face significant competition in China in various sub-markets we operate, primarily from Alibaba (Nasdaq: BABA), Pin Duoduo (Nasdaq:PDD), Douyu (Nasdaq: DOYU), Mango Media (SZ.300413), and TVZone Media (SH.603721). We compete for users, usage time, advertising customers, and shoppers.
These interim provisions also specify that, when an enterprise that is both Chinese-controlled and incorporated outside of mainland China, receives PRC-sourced incomes such as dividends and interests, no PRC withholding tax is applicable if such enterprise has obtained a certificate evidencing its status as a PRC resident enterprise that is registered overseas and controlled by Chinese.
These interim provisions also specify that, when an enterprise that is both Chinese-controlled and incorporated outside of mainland China, receives PRC-sourced incomes such as dividends and interests, no PRC withholding tax is applicable if such enterprise has obtained a certificate evidencing its status as a PRC resident enterprise that is registered overseas and controlled by Chinese. 35 Most members of our management team are based in China and are expected to remain in China.
Most members of our management team are based in China and are expected to remain in China. Although our offshore holding companies are not controlled by any PRC company or company group, we cannot assure you that it will not be deemed to be a PRC resident enterprise under the EIT Law and our implementation rules.
Although our offshore holding companies are not controlled by any PRC company or company group, we cannot assure you that it will not be deemed to be a PRC resident enterprise under the EIT Law and our implementation rules.
If any of these risks were to actually occur, our business, financial condition or results of operations could be materially adversely affected. Additional risks and uncertainties not currently known to us or that we currently consider to be immaterial may also materially adversely affect our business, financial condition or results of operations.
Additional risks and uncertainties not currently known to us or that we currently consider to be immaterial may also materially adversely affect our business, financial condition or results of operations.
As there are uncertainties regarding the enactment timetable, interpretation and implementation of the existing and future internet-related laws and regulations, we cannot assure you that our business operations will comply with such regulations in all respects and we may be ordered to terminate certain of our business operations that are deemed illegal by the regulatory authorities and become subject to fines and/or other sanctions.
As there are uncertainties regarding the enactment timetable, interpretation and implementation of the existing and future internet-related laws and regulations, we cannot assure you that our business operations will comply with such regulations in all respects and we may be ordered to terminate certain of our business operations that are deemed illegal by the regulatory authorities and become subject to fines and/or other sanctions. 32 The approval of the China Securities Regulatory Commission or other PRC regulatory agencies may be required in connection with overseas listings like our company under PRC law.
In any case, our reputation may be negatively affected by these allegations. We rely on computer software and hardware systems in our operations, the failure of which could adversely affect our business, financial condition, and results of operations. We are dependent upon our computer software and hardware systems in designing our advertisements and keeping important operational and market information.
We rely on computer software and hardware systems in our operations, the failure of which could adversely affect our business, financial condition, and results of operations. We are dependent upon our computer software and hardware systems in designing our advertisements and keeping important operational and market information.
In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law. In addition, Cayman Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States.
In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law.
We rely on a combination of patent, trademark, copyright and trade secret protection laws in China and other jurisdictions, as well as confidentiality procedures and contractual provisions to protect our intellectual property and our brand.
We believe that our patents, trademarks, trade secrets, copyrights, and other intellectual property we use are critical to our business. We rely on a combination of patent, trademark, copyright and trade secret protection laws in China and other jurisdictions, as well as confidentiality procedures and contractual provisions to protect our intellectual property and our brand.
Substantial uncertainties and restrictions with respect to the political and economic policies of the PRC government and PRC laws and regulations could have a significant impact upon the business we may be able to conduct in the PRC and accordingly on the results of our operations and financial condition.
Any actions and policies adopted by the PRC government could negatively impact the Chinese economy, which could materially adversely affect our business. 25 Substantial uncertainties and restrictions with respect to the political and economic policies of the PRC government and PRC laws and regulations could have a significant impact upon the business we may be able to conduct in the PRC and accordingly on the results of our operations and financial condition.
Any failure of us to fully comply with new regulatory requirements may significantly limit or completely hinder our ability to offer or continue to offer our Class A Ordinary Shares, cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely affect our financial condition and results of operations and cause our Class A Ordinary Shares to significantly decline in value or become worthless.
Any failure of us to fully comply with new regulatory requirements may significantly limit or completely hinder our ability to offer or continue to offer our Class A Ordinary Shares, cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely affect our financial condition and results of operations and cause our Class A Ordinary Shares to significantly decline in value or become worthless. 29 Our VIEs and their subsidiaries may be liable for improper collection, use or appropriation of personal information provided by our customers.
Further expansion of our operations and development of our CHEERS platforms to be incorporated into our metaverse platform involves numerous risks and challenges, including potential new competition, increased capital requirements and increased marketing spent to achieve customer awareness of these new products and services.
Historically, we have been a digital media platform and content-driven e-commerce company. Further expansion of our operations and development of our CHEERS platforms to be incorporated into our metaverse platform involves numerous risks and challenges, including potential new competition, increased capital requirements and increased marketing spent to achieve customer awareness of these new products and services.
We rely on information technology and other systems and services, and any failures, errors, defects or disruptions in our systems or services could diminish our brand and reputation, subject us to liability, disrupt our business, affect our ability to scale our technical infrastructure and adversely affect our operating results business growth.
In addition, the Internet infrastructure in China may not support the demands associated with continued growth in Internet usage. 9 We rely on information technology and other systems and services, and any failures, errors, defects or disruptions in our systems or services could diminish our brand and reputation, subject us to liability, disrupt our business, affect our ability to scale our technical infrastructure and adversely affect our operating results business growth.
Such litigation and an adverse determination in any such litigation could result in substantial costs and diversion of resources and management attention. 5 We face risks related to the incorporation of artificial intelligence into our products and business operations, and challenges with properly managing such technologies could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations.
We face risks related to the incorporation of artificial intelligence into our products and business operations, and challenges with properly managing such technologies could result in reputational harm, competitive harm, and legal liability, and adversely affect our results of operations.
If we are unable to obtain or maintain such rights because of intellectual property infringement claims brought by third parties against our suppliers and licensors or against us, or if we are unable to continue to utilize third-party technology, third-party artwork, enter into new agreements on commercially reasonable terms, or develop our own technology required, our ability to continue developing our platforms could be severely limited and our business could be harmed. 11 Our metaverse universe is currently under development and no assurance can be given that our metaverse platform will be accepted by others or generate sufficient interest.
If we are unable to obtain or maintain such rights because of intellectual property infringement claims brought by third parties against our suppliers and licensors or against us, or if we are unable to continue to utilize third-party technology, third-party artwork, enter into new agreements on commercially reasonable terms, or develop our own technology required, our ability to continue developing our platforms could be severely limited and our business could be harmed.
If we fail to retain existing or attract new advertising customers to advertise within our mobile and online video content or on our e-commerce platform, maintain and increase our wallet share of advertising budget, or if we are unable to collect accounts receivable in a timely manner, our business, financial condition and results of operations may be materially and adversely affected.
If we introduce new features or service offerings, or change the mix of existing features and services offerings, in a manner that is not favorably received by our users, we may not be able to attract and retain users and our business, financial condition and results of operations would be materially and adversely affected. 2 If we fail to retain existing or attract new advertising customers to advertise within our mobile and online video content or on our e-commerce platform, maintain and increase our wallet share of advertising budget, or if we are unable to collect accounts receivable in a timely manner, our business, financial condition and results of operations may be materially and adversely affected.
Our business depends in part on developing and implementing our metaverse platform and Metaverse Experience Centers. We have devoted and we expect to continue to devote substantial resources to development, analytics and marketing of our metaverse platform, however we cannot guarantee that our metaverse platform will be successful.
We have devoted and we expect to continue to devote substantial resources to development, analytics and marketing of our metaverse platform, however we cannot guarantee that our metaverse platform will be successful.
In the past, Chinese government promulgated a series of regulations and policies to prohibit or restrict the offering and trading of virtual currency, and some local regulatory authorities issued guiding opinions on promoting the construction of the city’s metacosmic standard system.
In the past, Chinese government promulgated a series of regulations and policies to prohibit or restrict the offering and trading of virtual currency, and some local regulatory authorities issued guiding opinions on promoting the construction of the city’s metacosmic standard system. However, no specific law or regulation has been published in the PRC to regulate the metaverse related businesses.
If our control over Horgos and Xing Cui Can through VIE Contracts are deemed as foreign investment in the future, and any business of Horgos and Xing Cui Can is “restricted” or “prohibited” from foreign investment under the Negative List effective at the time, we may be deemed to be in violation of the PRC Foreign Investment Law, the VIE Contracts that allow us to have control over Horgos and Xing Cui Can may be deemed as invalid and illegal, and we may be required to unwind such VIE Contracts and/or restructure our business operations, any of which may have a material adverse effect on our business operation. 17 Furthermore, if future laws, administrative regulations or provisions mandate further actions to be taken by companies with respect to existing VIE Contracts, we may face substantial uncertainties as to whether we can complete such actions in a timely manner, or at all.
If our control over Horgos and Xing Cui Can through VIE Contracts are deemed as foreign investment in the future, and any business of Horgos and Xing Cui Can is “restricted” or “prohibited” from foreign investment under the Negative List effective at the time, we may be deemed to be in violation of the PRC Foreign Investment Law, the VIE Contracts that allow us to have control over Horgos and Xing Cui Can may be deemed as invalid and illegal, and we may be required to unwind such VIE Contracts and/or restructure our business operations, any of which may have a material adverse effect on our business operation.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

98 edited+61 added−48 removed275 unchanged
Biggest changeCharter Amendment — Adoption of Dual-Class Share Structure On September 4, 2024, our board of directors authorized and approved the amendment and restatement of the Second Amended and Restated Memorandum and Articles of Association of the Company by the deletion in their entirety and the substitution in their place of the Third Amended and Restated Memorandum and Articles of Association (the “MAA”) to effect the increase of the Company’s authorized share capital as from US$200,200 divided into 200,000,000 ordinary shares of a par value of US$0.001 each and 2,000,000 preferred shares of a par value of US$0.0001 each; to US$200,700 divided into 200,000,000 Class A ordinary shares of a par value of US$0.001 each (the “Class A Ordinary Shares”), 500,000 Class B ordinary shares of a par value of US$0.001 each (the “Class B Ordinary Shares”) and 2,000,000 preferred shares of a par value of US$0.0001 each; by the creation of 500,000 Class B ordinary shares of a par value of US$0.001 each with the rights attaching to such shares as set out in the MAA (the “Charter Amendment”).
Biggest changeThis filing of the Amendment Resolution to the MAA effected an increase of the Company’s authorized share capital from US$200,700, divided into 200,000,000 Class A ordinary shares of a par value of US$0.001 each (the “Class A Shares”), 500,000 Class B ordinary shares of a par value of US$0.001 each (the “Class B Shares”), and 2,000,000 preferred shares of a par value of US$0.0001 each, to US$500,700, divided into 500,000,000 Class A Shares, 500,000 Class B Shares, and 2,000,000 preferred shares of a par value of US$0.0001 each.
Class A Ordinary Shares and Class B Ordinary Shares shall at all times vote together as one class, and each Class A Share shall be entitled to one (1) vote and each Class B Share shall be entitled to one hundred (100) votes.
Class A Ordinary Shares and Class B Ordinary Shares shall at all times vote together as one class, and each Class A Ordinary Share shall be entitled to one (1) vote and each Class B Ordinary Share shall be entitled to one hundred (100) votes.
Our quarterly operating results have fluctuated in the past and may continue to fluctuate depending upon a number of factors, many of which are out of our control. Our operating results tend to be seasonal. As a result, detailed attention shall be paid when comparing our operating results on a period-to-period basis.
Our quarterly operating results have fluctuated in the past and may continue to fluctuate depending upon a number of factors, many of which are out of our control. Our operating results tend to be seasonal. As a result, detailed attention shall be paid when comparing our operating results on a period-to-period basis.
We are committed to delivering premium products and scenario-based solutions for enterprise users, CHEERS API open platform enables businesses to accelerate digital innovation through application programming interfaces (API) ecosystem integration. The company’s self-developed CHEERS API open platform offers a full-stack API data service covering data aggregation, intelligent routing, and usage analytics.
We are committed to delivering premium products and scenario-based solutions for enterprise users, CHEERS API open platform enables businesses to accelerate digital innovation through application programming interfaces (API) ecosystem integration. 57 The company’s self-developed CHEERS API open platform offers a full-stack API data service covering data aggregation, intelligent routing, and usage analytics.
The Charter Amendment was approved by our shareholders on August 28, 2024. 43 Entry into Subscription Agreement for Class B Ordinary Shares On September 9, 2024, the Company entered into a Subscription Agreement (the “Subscription Agreement”) with Mr. Bing Zhang, the Company’s Chairman, Director, Chief Executive Officer and Chief Financial Officer.
The Charter Amendment was approved by our shareholders on August 28, 2024. Entry into Subscription Agreement for Class B Ordinary Shares On September 9, 2024, the Company entered into a Subscription Agreement (the “Subscription Agreement”) with Mr. Bing Zhang, the Company’s Chairman, Director, Chief Executive Officer and Chief Financial Officer.
An employer that fails to make social insurance contributions may be ordered to rectify the non-compliance and pay the required contributions within a stipulated deadline and be subject to a late fee. Intellectual Property Our success depends largely on our ability to protect our core technology and intellectual property.
An employer that fails to make social insurance contributions may be ordered to rectify the non-compliance and pay the required contributions within a stipulated deadline and be subject to a late fee. 62 Intellectual Property Our success depends largely on our ability to protect our core technology and intellectual property.
As a pioneer, our strategy has always been committed to advanced technology, innovation and digital disruption in the media and entertainment industry. In July 2023, we launched CHEERS Telepathy, a groundbreaking AI content creation platform that incorporates multimodal functions.
As a pioneer, our strategy has always been committed to advanced technology, innovation and digital disruption in the media and entertainment industry. 52 In July 2023, we launched CHEERS Telepathy, a groundbreaking AI content creation platform that incorporates multimodal functions.
The equity pledge agreements will remain in full force and remain effective until the VIE and the VIE shareholders have satisfied their obligations under the Principal Agreements. Proxy Agreements and Powers of Attorney . WFOE entered into separate Proxy Agreements and Powers of Attorney with Xing Cui Can and Horgos, and their respective shareholders in September 2019.
The equity pledge agreements will remain in full force and remain effective until the VIE and the VIE shareholders have satisfied their obligations under the Principal Agreements. 81 Proxy Agreements and Powers of Attorney . WFOE entered into separate Proxy Agreements and Powers of Attorney with Xing Cui Can and Horgos, and their respective shareholders in September 2019.
For other false advertisements of goods or services, where the advertising operator, advertising publisher and advertising spokesperson knew or should have known the falsity yet still provided design, production, agency or publishing services, or provide recommendation or endorsement, they will bear joint and several liability with the advertiser. 58 PRC advertising laws and regulations provide specific content requirements for advertisements in China, which include prohibitions on, among other things, misleading content, superlative wording, socially destabilizing content or content involving obscenities, superstition, violence, discrimination or infringement of the public interest.
For other false advertisements of goods or services, where the advertising operator, advertising publisher and advertising spokesperson knew or should have known the falsity yet still provided design, production, agency or publishing services, or provide recommendation or endorsement, they will bear joint and several liability with the advertiser. 67 PRC advertising laws and regulations provide specific content requirements for advertisements in China, which include prohibitions on, among other things, misleading content, superlative wording, socially destabilizing content or content involving obscenities, superstition, violence, discrimination or infringement of the public interest.
This notice has amended SAFE Circular 37 requiring PRC residents or entities to register with qualified banks rather than SAFE or our local branch in connection with their establishment or control of an offshore entity established for the purpose of overseas investment or financing. 63 Regulations on Foreign Currency Exchange The principal regulation governing foreign currency exchange in China is the Foreign Exchange Administration Rules of the PRC , or the Foreign Exchange Administration Rules, promulgated on January 29, 1996, as subsequently amended on January 14, 1997, and August 1, 2008.
This notice has amended SAFE Circular 37 requiring PRC residents or entities to register with qualified banks rather than SAFE or our local branch in connection with their establishment or control of an offshore entity established for the purpose of overseas investment or financing. 73 Regulations on Foreign Currency Exchange The principal regulation governing foreign currency exchange in China is the Foreign Exchange Administration Rules of the PRC , or the Foreign Exchange Administration Rules, promulgated on January 29, 1996, as subsequently amended on January 14, 1997, and August 1, 2008.
Regulations on the Media Industry Program Content According to the Provisions on the Administration of Radio and Television Program Production promulgated by the State Administration of Radio, Film and Television, or SARFT, on July 19, 2004 and took effect in August 20, 2004, and was amended on August 28, 2015 and October 29, 2020, entities engaging in (i) the production of television programs, such as feature programs, general programs, drama series and animations, and (ii) the trading activities and agency services on the copyrights of such programs, must first obtain preliminary approval from the SARFT or our provincial branches for license.
Regulations on the Media Industry Program Content According to the Provisions on the Administration of Radio and Television Program Production promulgated by the State Administration of Radio, Film and Television, or SARFT, on July 19, 2004 and took effect in August 20, 2004, and was amended on August 28, 2015, October 29, 2020 and June 3, 2025, entities engaging in (i) the production of television programs, such as feature programs, general programs, drama series and animations, and (ii) the trading activities and agency services on the copyrights of such programs, must first obtain preliminary approval from the SARFT or our provincial branches for license.
CHEERS Telepathy is now a comprehensive AI tool for creative content marketing and is able to caters to diverse AI needs across private and commercial applications, delivering efficient and stable services. 48 Leveraging the advanced computational power of “Polaris”, CHEERS Telepathy delivers exceptional performance efficiency and real-time responsiveness.
CHEERS Telepathy is now a comprehensive AI tool for creative content marketing and is able to caters to diverse AI needs across private and commercial applications, delivering efficient and stable services. 56 Leveraging the advanced computational power of “Polaris”, CHEERS Telepathy delivers exceptional performance efficiency and real-time responsiveness.
The Administrative Measures for Online Advertising further provides that an online ad shall be identifiable so that it can be clearly identified by consumers as an advertisement. Any paid search ad for a product or service shall be prominently indicated as an ‘‘advertisement’’ by the advertising publisher to distinguish it from natural search results.
The Administrative Measures for Online Advertising further provides that an online ad shall be identifiable so that it can be clearly identified by consumers as an advertisement. Any paid search ad for a product or service shall be prominently indicated as an “advertisement’’ by the advertising publisher to distinguish it from natural search results.
The 2024 Plan allows for the award of stock and options, up to 2,000,000 Class A Ordinary Shares. Share Repurchase Program On December 2, 2024, our board of directors approved a share repurchase program authorizing a repurchase of up to $50 million of its Class A Ordinary Shares over the next 36 months (the “Share Repurchase Program”).
The 2024 Plan allows for the award of stock and options, up to 40,000 Class A Ordinary Shares. Share Repurchase Program On December 2, 2024, our board of directors approved a share repurchase program authorizing a repurchase of up to $50 million of our Class A Ordinary Shares over the next 36 months (the “Share Repurchase Program”).
The proxy agreements and powers of attorney shall remain in effect during the term of the Exclusive Service Agreements. 70 Confirmation and Guarantee Letter .
The proxy agreements and powers of attorney shall remain in effect during the term of the Exclusive Service Agreements. Confirmation and Guarantee Letter .
Cheers Space This regular weekly program focuses on home décor and interior design. 51 Drama & Variety Shows We have partnered with third parties to produce and license original online drama and variety show series for distribution on online video platforms.
Cheers Space This regular weekly program focuses on home décor and interior design. 59 Drama & Variety Shows We have partnered with third parties to produce and license original online drama and variety show series for distribution on online video platforms.
As of December 31, 2024, we had five (5) invention patents in the PRC. 61 Regulations on Copyright Under the Copyright Law , issued in 1990 and most recently amended in 2020, or the Copyright Law, and our related Implementing Regulations issued in 2002 and amended in 2013, creators of protected works enjoy personal and property rights with respect to publication, authorship, alteration, integrity, reproduction, distribution, lease, exhibition, performance, projection, broadcasting, dissemination via information network, production, adaptation, translation, compilation and related activities.
As of December 31, 2025, we had five (5) invention patents in the PRC. 71 Regulations on Copyright Under the Copyright Law , issued in 1990 and most recently amended in 2020, or the Copyright Law, and our related Implementing Regulations issued in 2002 and amended in 2013, creators of protected works enjoy personal and property rights with respect to publication, authorship, alteration, integrity, reproduction, distribution, lease, exhibition, performance, projection, broadcasting, dissemination via information network, production, adaptation, translation, compilation and related activities.
In December 2023, Glory Star Media (Beijing) Co., Ltd (耀世星辉（北京）传媒有限公司) was recognized as a “high and new technology enterprise” by the Beijing Municipal Science & Technology Commission, Beijing Municipal Finance Bureau and Beijing Municipal Tax Service of State Taxation Administration and will be entitled to a preferential tax rate of 15%, subject to certain qualification criteria, from 2023 to 2025.
(悦享星光（北京）科技有限公司) was recognized as a “high and new technology enterprise” by the Beijing Municipal Science & Technology Commission, Beijing Municipal Finance Bureau and Beijing Municipal Tax Service of State Taxation Administration and will be entitled to a preferential tax rate of 15%, subject to certain qualification criteria, from 2019 to 2022. 75 In December 2023, Glory Star Media (Beijing) Co., Ltd (耀世星辉（北京）传媒有限公司) was recognized as a “high and new technology enterprise” by the Beijing Municipal Science & Technology Commission, Beijing Municipal Finance Bureau and Beijing Municipal Tax Service of State Taxation Administration and will be entitled to a preferential tax rate of 15%, subject to certain qualification criteria, from 2023 to 2025.
Filing by Third-Party Platform Providers for Online Food Trading In July 2016, the State Food and Drug Administration, or SFDA, promulgated the Measures for Investigation and Handling of Illegal Acts Involving Online Food Safety , last amended in April 2021, pursuant to which a third-party platform provider for online food trading in the PRC is required to file a record with the food and drug administration at the provincial level and obtain a filing number.
Filing by Third-Party Platform Providers for Online Food Trading In July 2016, the State Food and Drug Administration, or SFDA, promulgated the Measures for Investigation and Handling of Illegal Acts Involving Online Food Safety , last amended in March 2025, pursuant to which a third-party platform provider for online food trading in the PRC is required to file a record with the food and drug administration at the provincial level and obtain a filing number.
The Personal Information Protection Law of the PRC ( 《中华人民共和国个人信息保护法》 ) (the ‘‘Personal Information Protection Law’’) was passed by the SCNPC on 20 August 2021 and has come into effect on 1 November 2021.
The Personal Information Protection Law of the PRC (《中华人民共和国个人信息保护法》) (the “Personal Information Protection Law’’) was passed by the SCNPC on 20 August 2021 and has come into effect on 1 November 2021.
The Data Security Law of the PRC ( 《中华人民共和国数据安全法》 ) (the ‘‘Data Security Law’’) was passed by the SCNPC on 10 June 2021 and came into effect on 1 September 2021.
The Data Security Law of the PRC (《中华人民共和国数据安全法》) (the “Data Security Law’’) was passed by the SCNPC on 10 June 2021 and came into effect on 1 September 2021.
As of December 31, 2024, we had 12 domain names in PRC. 62 LABOR REGULATIONS Labor Contract Law The PRC Labor Contract Law was promulgated on June 29, 2007, as amended on December 28, 2012, and became effective on July 1, 2013.
As of December 31, 2025, we had 12 domain names in PRC. LABOR REGULATIONS Labor Contract Law The PRC Labor Contract Law was promulgated on June 29, 2007, as amended on December 28, 2012, and became effective on July 1, 2013.
As of March 18, 2019, Xing Hui Beijing has completed the required filing formalities with the competent food and drug administration. 57 Regulations Relating to Product Quality and Consumer Rights Protection Based on the PRC Consumer Rights and Interests Protection Law , as amended and effective in March 2014, and the Supervision and Administrative Measures on Online Trading, or Online Trading Measures, by State Administration for Market Regulation, or SAMR, on March 15, 2021, have provided stringent requirements and obligations on business operators, including internet business operators and platform service providers.
As of March 18, 2019, Xing Hui Beijing has completed the required filing formalities with the competent food and drug administration. 66 Regulations Relating to Product Quality and Consumer Rights Protection Based on the PRC Consumer Rights and Interests Protection Law , as amended and effective in March 2014, and the Supervision and Administrative Measures on Online Trading, or Online Trading Measures, by State Administration for Market Regulation, or SAMR, as amended and effective in May, 2025, have provided stringent requirements and obligations on business operators, including internet business operators and platform service providers.
In addition, as part of our long term retail strategy, we plan to continue leveraging our CHEERS ecosystem, blockchain technologies and strategic collaborations with various partners on AR and VR technologies, to develop a metaverse platform that features a virtual world containing immersive experiences in intelligent retail, video on demand, social networking, gaming and NFT.
In addition, as part of our long term retail strategy, we plan to continue leveraging our CHEERS ecosystem, blockchain technologies and strategic collaborations with various partners on AR and VR technologies, to develop a metaverse platform that features a virtual world containing immersive experiences in intelligent retail, video on demand, social networking, gaming and AI-driven content creation.
In May 2022 and December 2022, Leshare Star (Beijing) Technology Co., Ltd. （悦享星光（北京）科技有限公司） was recognized as qualified high and new technology enterprise (“ 国家专精特新企业 ”) by National Ministry of Industry and Information Technology, National Ministry of Science and Technology, and will entitle it certain preferential treatments, subject to certain qualification criteria, from 2022 to 2025.
In May 2022 and December 2022, Leshare Star (Beijing) Technology Co., Ltd.（悦享星光（北京）科技有限公司）was recognized as qualified high and new technology enterprise (“国家专精特新企业”) by National Ministry of Industry and Information Technology, National Ministry of Science and Technology, which entitles it certain preferential treatments, subject to certain qualification criteria, from 2022 to 2025.
The following is a summary of the VIE Contracts that provide us provide us the power to direct the activities of the VIEs that most significantly affect the VIEs’ economic performance, and to receive substantially all the economic benefit of the VIEs from our operations. .
The following is a summary of the VIE Contracts that provide us provide us the power to direct the activities of the VIEs that most significantly affect the VIEs’ economic performance, and to receive substantially all the economic benefit of the VIEs from our operations. Contracts that allow us to direct the activities of the VIEs Business Cooperation Agreement .
We have upgraded the platform to include UGC rights management system. With these upgrades, content creators now have access and opportunity to co-build the platform and contribute to the improvement of the content production ecosystem. We have made a new strategic plan of cultivating outstanding content creators and producing high quality UGC in the long run in partnership with us.
With these upgrades, content creators now have access and opportunity to co-build the platform and contribute to the improvement of the content production ecosystem. We have made a new strategic plan of cultivating outstanding content creators and producing high quality UGC in the long run in partnership with us.
We lease a total of 1248.27 square meters of office space, including our principal executive office. We pay monthly rent of approximately $11,615.87 per month. We believe that our current offices are suitable and adequate to operate our business at this time. We do not own any real property. Item 4A. UNRESOLVED STAFF COMMENTS Not applicable. 72
We lease a total of 1233.27 square meters of office space, including our principal executive office. We pay monthly rent of approximately $11,768.14per month. We believe that our current offices are suitable and adequate to operate our business at this time. We do not own any real property. Item 4A. UNRESOLVED STAFF COMMENTS Not applicable.
The Circular on Reforming the Management Approach regarding the Settlement of Foreign Capital of Foreign-invested Enterprise , or the SAFE Circular No. 19, which was promulgated by the SAFE on March 30, 2015 and became effective on June 1, 2015 and partially abolished on December 30, 2019, provides that a foreign-invested enterprise may, according to our actual business needs, settle with a bank the portion of the foreign exchange capital in our capital account for which the relevant foreign exchange administration has confirmed monetary capital contribution rights and interests (or for which the bank has registered the injection of the monetary capital contribution into the account).
The qualified banks, under the supervision of SAFE, will directly examine the applications and conduct the registration. 74 The Circular on Reforming the Management Approach regarding the Settlement of Foreign Capital of Foreign-invested Enterprise , or the SAFE Circular No. 19, which was promulgated by the SAFE on March 30, 2015 and became effective on June 1, 2015 and partially abolished on December 30, 2019, provides that a foreign-invested enterprise may, according to our actual business needs, settle with a bank the portion of the foreign exchange capital in our capital account for which the relevant foreign exchange administration has confirmed monetary capital contribution rights and interests (or for which the bank has registered the injection of the monetary capital contribution into the account).
As of December 31, 2024, we own five (5) patents in the PRC, 84 registered trademarks in the PRC, and 10 registered trademarks in Hong Kong. In addition, as of December 31, 2024, we had 75 registered copyrights in the PRC (including 61 software copyrights relating to various aspects of our operations and 14 artwork copyrights).
As of December 31, 2025, we own five (5) patents in the PRC, 82 registered trademarks in the PRC, and 10 registered trademarks in Hong Kong. In addition, as of December 31, 2025, we had 84 registered copyrights in the PRC (including 70 software copyrights relating to various aspects of our operations and 14 artwork copyrights).
Proprietary PGC video content-driven e-commerce platform A proprietary PGC video content-driven e-commerce platform is a segment of content-driven e-commerce platform, with in-house professional video production and proprietary e-commerce platform. When compared with other video content-driven e-commerce platforms, a proprietary PGC video content-driven e-commerce platform usually has a larger advantage in maintaining high-quality content production with dedicated professional production teams.
When compared with other video content-driven e-commerce platforms, a proprietary PGC video content-driven e-commerce platform usually has a larger advantage in maintaining high-quality content production with dedicated professional production teams.
Monetization A video content-driven e-commerce platform can usually monetize video content through following means: ● Advertising revenue for in-video product placement, start screen ads, in-app banner ads, and other forms of advertisements; ● Commission revenue from video producers and live streamers on the platform when transactions are completed and settled; and ● Direct e-commerce sales of commodities on the platform.
Monetization A video content-driven e-commerce platform can usually monetize video content through following means: ● Advertising revenue for in-video product placement, start screen ads, in-app banner ads, and other forms of advertisements; ● Commission revenue from video producers and live streamers on the platform when transactions are completed and settled; and ● Direct e-commerce sales of commodities on the platform. 61 Proprietary PGC video content-driven e-commerce platform A proprietary PGC video content-driven e-commerce platform is a segment of content-driven e-commerce platform, with in-house professional video production and proprietary e-commerce platform.
On July 10, 2023, the CAC and other six PRC regulatory agencies promulgated the Interim Measures for the Management of Generative Artificial Intelligence Services ( 《生成式人工智能服务管理暂行办法》 ), which became effective on August 15, 2023 and is applicable to the utilization of generative AI technology to provide services that generate any text, images, audios, videos or other content (the “generative AI services”) to the public within the territory of the PRC.
Enterprises shall take the lead in the full course of scenario innovation of AI technology. 70 On July 10, 2023, the CAC and other six PRC regulatory agencies promulgated the Interim Measures for the Management of Generative Artificial Intelligence Services (《生成式人工智能服务管理暂行办法》), which became effective on August 15, 2023 and is applicable to the utilization of generative AI technology to provide services that generate any text, images, audios, videos or other content (the “generative AI services”) to the public within the territory of the PRC.
Property, Plants and Equipment Our principal executive office is located at 19F, Xinhua Technology Building, No. 8 Tuofangying Road, Jiangtai, Chaoyang District, Beijing, People ’ s Republic of China, which has approximately 985 square meters of office space. As of December 31, 2024, we also rent an additional four (4) facilities primarily used for office space.
Property, Plants and Equipment Our principal executive office is located at 19F, Xinhua Technology Building, No. 8 Tuofangying Road, Jiangtai, Chaoyang District, Beijing, People’s Republic of China, which has approximately 985 square meters of office space. As of December 31, 2025, we also rent an additional three (3) facilities primarily used for office space.
The Company’s consecutive recognition as both National High-Tech Enterprise and Specialized and Innovative Enterprise specializing in advanced technologies underscores its leadership in technological innovation, robust market competitiveness, and dominant position within the media technology sector.
In April 2024, our Beijing subsidiary was recognized as Specialized and Innovative Enterprise. The Company’s consecutive recognition as both National High-Tech Enterprise and Specialized and Innovative Enterprise specializing in advanced technologies underscores its leadership in technological innovation, robust market competitiveness, and dominant position within the media technology sector.
For example: ● we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company; ● for interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that apply to domestic public companies; ● we are not required to provide the same level of disclosure on certain issues, such as executive compensation; ● we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information; ● we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; and ● we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and establishing insider liability for profits realized from any “short-swing” trading transaction. 44 The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.
For example: ● we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company; ● for interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that apply to domestic public companies; ● we are not required to provide the same level of disclosure on certain issues, such as executive compensation; ● we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information; ● we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; and ● we are not required to comply with certain parts of Section 16 of the Exchange Act establishing insider liability for profits realized from any “short-swing” trading transaction.
Any failure by the VIEs or their respective shareholders to perform their obligations under these contractual arrangements, and any failure by us to maintain control over the VIEs and direct their business activities would result in our inability to continue to consolidate our VIEs’ financial results of operations in our financial results of operations and would have a material adverse effect on our business.
Any failure by the VIEs or their respective shareholders to perform their obligations under these contractual arrangements, and any failure by us to maintain control over the VIEs and direct their business activities would result in our inability to continue to consolidate our VIEs’ financial results of operations in our financial results of operations and would have a material adverse effect on our business. 79 The following diagram illustrates our corporate structure as of December 31, 2025.
The central government of the PRC and the government of Hong Kong signed the Arrangement between the Mainland of the PRC and Hong Kong for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income on August 21, 2006, or the Arrangement.
The Implementation Rules reduced the rate from 20% to 10%. The central government of the PRC and the government of Hong Kong signed the Arrangement between the Mainland of the PRC and Hong Kong for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income on August 21, 2006, or the Arrangement.
Therein, where an applicant is a “beneficial owner” pursuant to the provisions of Article 3 of this Announcement, the applicant shall also provide, in addition to the tax resident identity of the applicant, the tax resident identity documents of the person who satisfies the criteria for “beneficial owner” and the person who satisfies the criteria, issued by the tax authorities in charge at the country (region) where he/she resides; where the applicant is a “beneficial owner” pursuant to the provisions of item (4) of Article 4 of this Announcement, the applicant shall also provide, in addition to the tax resident identity document of the applicant, the tax resident identity documents of the person who holds 100% of the applicant’s shares directly or indirectly and the multi-tier holders, issued by the tax authorities in charge at the country (region) for which the said person and the multi-tier holders are residents; the tax resident identity document shall prove that the person is a tax resident in the year in which the income is obtained or the preceding year. 66 Regulations on Tax regarding Indirect Transfer On February 3, 2015, the SAT issued the Circular on Issues of Enterprise Income Tax on Indirect Transfers of Assets by Non-PRC Resident Enterprises , or Circular 7.
Therein, where an applicant is a “beneficial owner” pursuant to the provisions of Article 3 of this Announcement, the applicant shall also provide, in addition to the tax resident identity of the applicant, the tax resident identity documents of the person who satisfies the criteria for “beneficial owner” and the person who satisfies the criteria, issued by the tax authorities in charge at the country (region) where he/she resides; where the applicant is a “beneficial owner” pursuant to the provisions of item (4) of Article 4 of this Announcement, the applicant shall also provide, in addition to the tax resident identity document of the applicant, the tax resident identity documents of the person who holds 100% of the applicant’s shares directly or indirectly and the multi-tier holders, issued by the tax authorities in charge at the country (region) for which the said person and the multi-tier holders are residents; the tax resident identity document shall prove that the person is a tax resident in the year in which the income is obtained or the preceding year.
Recent Business Developments We leverage AI technology to enhance content creation, digital ecosystems, and human-AI interaction, driving long-term growth through innovative products and services. In February 2024, we launched the Year of the Dragon Edition of CHEERS Telepathy.
We are committed to utilizing innovative product applications and technologies to drive its long-term sustainable and scalable growth. Recent Business Developments We leverage AI technology to enhance content creation, digital ecosystems, and human-AI interaction, driving long-term growth through innovative products and services. In February 2024, we launched the Year of the Dragon Edition of CHEERS Telepathy.
Pursuant to the Charter Amendment: ● Class A Ordinary Shares and Class B Ordinary Shares shall at all times vote together as one class on all resolutions submitted to a vote by the shareholders; ● Each Class A Ordinary Shares shall be entitled to one (1) vote on all matters subject to vote at general meetings of the Issuer, and each Class B Ordinary Share shall be entitled to one hundred (100) votes on all matters subject to vote at general meetings of the Issuer; ● Upon winding up of the Issuer, holders of Class A Ordinary Shares shall be entitled to participate in the surplus assets of the Issuer, and holders of Class B Ordinary Shares shall only be entitled to repayment of capital; ● In terms of dividends, holders of Class A Ordinary Shares shall be entitled the right to receive dividend, and holders of Class B Ordinary Shares shall not be entitled to any dividends; ● As to redemption, a Class B Share may be redeemed at par value at the option of the holder; and ● Class A Ordinary Shares and Class B Ordinary Shares are not convertible.
Dual-Class Share Structure Our Third Amended and Restated Memorandum and Articles of Association (the “MAA”) includes a dual Class Share Structure of Class A Ordinary Shares and Class B Ordinary Shares with the following rights: ● Class A Ordinary Shares and Class B Ordinary Shares shall at all times vote together as one class on all resolutions submitted to a vote by the shareholders; ● Each Class A Ordinary Shares shall be entitled to one (1) vote on all matters subject to vote at general meetings of the Issuer, and each Class B Ordinary Share shall be entitled to one hundred (100) votes on all matters subject to vote at general meetings of the Issuer; 49 ● Upon winding up of the Issuer, holders of Class A Ordinary Shares shall be entitled to participate in the surplus assets of the Issuer, and holders of Class B Ordinary Shares shall only be entitled to repayment of capital; ● In terms of dividends, holders of Class A Ordinary Shares shall be entitled the right to receive dividend, and holders of Class B Ordinary Shares shall not be entitled to any dividends; ● As to redemption, a Class B Share may be redeemed at par value at the option of the holder; and ● Class A Ordinary Shares and Class B Ordinary Shares are not convertible.
We have entered into written employment contracts with all of our employees in accordance with PRC Labor Law and Contract Law. None of our employees is covered by collective bargaining contracts.
Employees As of December 31, 2025, we had 116 full time employees. We have entered into written employment contracts with all of our employees in accordance with PRC Labor Law and Contract Law. None of our employees is covered by collective bargaining contracts.
In May 2015, the State Council promulgated the Opinions on Striving to Develop E-commerce to Speed Up the Cultivation of New Economic Driving Force in order to lower the requirements for market access, further simplify the registration of registered capital, deeply promote the reform from “certificate before license” to “license before certificate” in the field of e-commerce and simplify the approval process for the overseas listing of e-commerce enterprises in the territory and encourage the cross-border RMB direct investment in the field of e-commerce.
In May 2015, the State Council promulgated the Opinions on Striving to Develop E-commerce to Speed Up the Cultivation of New Economic Driving Force in order to lower the requirements for market access, further simplify the registration of registered capital, deeply promote the reform from “certificate before license” to “license before certificate” in the field of e-commerce and simplify the approval process for the overseas listing of e-commerce enterprises in the territory and encourage the cross-border RMB direct investment in the field of e-commerce. 65 In addition, in December 2016, Guiding Opinions on Fully Enhancing the Credit Construction in the E-commerce Sector was issued by the State Administration for Industry and Commerce and other governmental authorities.
Glory Star has transferred cash of approximately $10.0 million from the net proceeds from our underwritten public offering that we completed in February 2021, where an aggregate of 3,810,976 of our Class A Ordinary Shares, together with warrants to purchase 3,810,976 of our Class A Ordinary Shares, were offered and sold at a public offering price of $3.28 per share and associated warrant (the “Public Offering”) to the WFOE in the form of capital contributions.
Glory Star HK is also permitted under the laws of Hong Kong to provide funding to Glory Star through dividend distribution without restrictions on the amount of the funds. 82 Glory Star has transferred cash of approximately $10.0 million from the net proceeds from our underwritten public offering that we completed in February 2021, where an aggregate of 3,810,976 of our Class A Ordinary Shares, together with warrants to purchase 3,810,976 of our Class A Ordinary Shares, were offered and sold at a public offering price of $3.28 per share and associated warrant (the “Public Offering”) to the WFOE in the form of capital contributions.
Pursuant to the Arrangement between Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income, or the Double Tax Avoidance Arrangement, the 10% withholding tax rate may be lowered to 5% if a Hong Kong resident enterprise owns no less than 25% of a PRC project.
As of the date of this annual report, our PRC subsidiary has not made any transfers or distributions. 83 Pursuant to the Arrangement between Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income, or the Double Tax Avoidance Arrangement, the 10% withholding tax rate may be lowered to 5% if a Hong Kong resident enterprise owns no less than 25% of a PRC project.
Under Cayman Islands law, a Cayman Islands company may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts as they fall due in the ordinary course of business. 71 Under the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect of dividends paid by us.
Under Cayman Islands law, a Cayman Islands company may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts as they fall due in the ordinary course of business.
Market scale Key successful factors for video content-driven e-commerce platforms ● Selection of commodities: A platform must be careful and thoughtful in selecting commodities with high popularity and reasonable profit margin to keep customers attracted. ● Sustainable high-quality video content: A platform must be able to sustain consistent video content quality and avoid publishing any video that may result in negative publicity, or even regulatory punishment. ● Stable customer inflow: A platform must secure a solid channel for customer acquisition and to keep all customer activities within a proprietary ecosystem in order to minimize customer loss. 53 Competition Our competitors include Alibaba (Nasdaq: BABA), Pin Duoduo (Nasdaq: PDD), Douyu (Nasdaq: DOYU), Mango Media (SZ.300413), and Zhong Guang Tianze (SH.603721) for users, shoppers, and advertising customers.
Market scale Key successful factors for video content-driven e-commerce platforms ● Selection of commodities: A platform must be careful and thoughtful in selecting commodities with high popularity and reasonable profit margin to keep customers attracted. ● Sustainable high-quality video content: A platform must be able to sustain consistent video content quality and avoid publishing any video that may result in negative publicity, or even regulatory punishment. ● Stable customer inflow: A platform must secure a solid channel for customer acquisition and to keep all customer activities within a proprietary ecosystem in order to minimize customer loss.
According to the Circular on Policies in Relation to the Deepening of Value-added Tax Reforms, which was jointly promulgated by the MOF, the SAT and the General Administration of Customs on March 20, 2019, the tax rate of 16% and 10% originally applicable to general VAT taxpayers’ VAT taxable sales or goods import shall be adjusted to 13% and 9%, respectively.
According to the Circular on Policies in Relation to the Deepening of Value-added Tax Reforms, which was jointly promulgated by the MOF, the SAT and the General Administration of Customs on March 20, 2019, the tax rate of 16% and 10% originally applicable to general VAT taxpayers’ VAT taxable sales or goods import shall be adjusted to 13% and 9%, respectively. 76 Dividend Distribution The EIT Law prescribes a standard withholding tax rate of 20% on dividends and other PRC sourced passive income of non-resident enterprises.
The SAFE Circular No. 16 also provides an integrated standard for conversion of foreign exchange under capital account items (including but not limited to foreign currency capital and foreign debts) on self-discretionary basis, which applies to all enterprises registered in the PRC. 64 On October 23, 2019, the SAFE promulgated the Circular of the State Administration of Foreign Exchange on Further Promoting Cross-border Trade and Investment Facilitation or the SAFE Circular No. 28, which expressly allows foreign-invested enterprises that do not have equity investments in their approved business scope to use their capital obtained from foreign exchange settlement to make domestic equity investments as long as there is a truthful investment and such investment is in compliance with the foreign investment-related laws and regulations.
On October 23, 2019, the SAFE promulgated the Circular of the State Administration of Foreign Exchange on Further Promoting Cross-border Trade and Investment Facilitation or the SAFE Circular No. 28, which expressly allows foreign-invested enterprises that do not have equity investments in their approved business scope to use their capital obtained from foreign exchange settlement to make domestic equity investments as long as there is a truthful investment and such investment is in compliance with the foreign investment-related laws and regulations.
The following table sets forth a breakdown of employees categorized by function as at December 31, 2024: Department Headcount Percentage of Total Human Resource and General Management Department 6 4.9 % Financial Management Department 8 6.6 % Business Development and Securities Department 1 0.8 % Public and Investor Relations Department 2 1.6 % Information Technology and Research Department 30 24.6 % Integrated Content Marketing Department 25 20.5 % CHEERS Platform and e-Mall Department 50 41.0 % Total 122 100.00 % As required by PRC regulations, we participate in various government statutory social security plans, including a pension contribution plan, a medical insurance plan, an unemployment insurance plan, a work-related injury insurance plan, a maternity insurance plan and a housing provident fund.
The following table sets forth a breakdown of employees categorized by function as at December 31, 2025: Department Headcount Percentage of Total Human Resource and General Management Department 5 4.3 % Financial Management Department 6 5.2 % Investor Relations and Legal Department 2 1.7 % Research and Development Department 39 33.6 % Content Marketing and Live Streaming Department 22 19.0 % CHEERS Platform and e-Mall Department 42 36.2 % Total 116 100.00 % As required by PRC regulations, we participate in various government statutory social security plans, including a pension contribution plan, a medical insurance plan, an unemployment insurance plan, a work-related injury insurance plan, a maternity insurance plan and a housing provident fund.
Regulations on Domain Names Internet domain name registration and related matters are primarily regulated by the Measures on Administration of Internet Domain Names , which were promulgated by the MIIT on August 24, 2017 and took effect on November 1, 2017, and the Detailed Rules for the Implementation of National Top-level Domain Name Registration , which were promulgated by China Internet Network Information Center and took into effect on June 18, 2019.
As of December 31, 2025, we had eighty-two (82) registered trademarks in the PRC and ten (10) registered trademarks in Hong Kong. 72 Regulations on Domain Names Internet domain name registration and related matters are primarily regulated by the Measures on Administration of Internet Domain Names , which were promulgated by the MIIT on August 24, 2017 and took effect on November 1, 2017, and the Detailed Rules for the Implementation of National Top-level Domain Name Registration , which were promulgated by China Internet Network Information Center and took into effect on June 18, 2019.
Any organisation or individual that need to obtain personal information of others shall obtain such information legally and ensure the security of such information, and shall not illegally collect, use, process or transmit personal information of others, or illegally purchase, sell, provide or make public personal information of others. 59 The Cyber Security Law of the PRC ( 《中华人民共和国网络安全法》 ) (the ‘‘Cyber Security Law’’), which was promulgated on 7 November 2016 and came into effect on 1 June 2017, requires that when constructing and operating a network, or providing services through a network, technical measures and other necessary measures shall be taken in accordance with laws, administrative regulations and the compulsory requirements set forth in national standards to ensure the secure and stable operation of the network, to effectively cope with cyber security events, to prevent criminal activities committed on the network, and to protect the integrity, confidentiality and availability of network data.
The Cyber Security Law of the PRC (《中华人民共和国网络安全法》) (the “Cyber Security Law’’), which was promulgated on 7 November 2016, came into effect on 1 June 2017 and amended on October 28, 2025, requires that when constructing and operating a network, or providing services through a network, technical measures and other necessary measures shall be taken in accordance with laws, administrative regulations and the compulsory requirements set forth in national standards to ensure the secure and stable operation of the network, to effectively cope with cyber security events, to prevent criminal activities committed on the network, and to protect the integrity, confidentiality and availability of network data.
In addition, the state will promote the application of blockchain technology and industrial development through application pilots, policy support and strengthening training of industrial talent. 60 Regulations Related to Artificial Intelligence On July 29, 2022, the Ministry of Science and Technology and other five PRC regulatory agencies issued the Circular on Issuing the Guiding Opinions on Accelerating Scenario Innovation and Driving High-quality Economic Growth with High-Level Applications of Artificial Intelligence ( 《关于印发 的通知》 ), which became effective on the same day.
Regulations Related to Artificial Intelligence On July 29, 2022, the Ministry of Science and Technology and other five PRC regulatory agencies issued the Circular on Issuing the Guiding Opinions on Accelerating Scenario Innovation and Driving High-quality Economic Growth with High-Level Applications of Artificial Intelligence (《关于印发 的通知》), which became effective on the same day.
The plan includes multiple initiatives such as traffic support and cash subsidies for content creators and guidance of trending topics to support the creation of high-quality videos. We will also adopt NFT technology to help guard the copyrights of original content.
The plan includes multiple initiatives such as traffic support and cash subsidies for content creators and guidance of trending topics to support the creation of high-quality videos.
In April 2024, Glory Star Media (Beijing) Co., Ltd (耀世星辉（北京）传媒有限公司) was recognized as qualified high and new technology enterprise (“ 国家专精特新企业 ”) by National Ministry of Industry and Information Technology, National Ministry of Science and Technology, and will entitle it certain preferential treatments, subject to certain qualification criteria, from 2024 to 2027. 65 Regulation on PRC Value-added Tax According to the Interim Regulations of PRC on Value-added Tax, which was promulgated by the State Council on December 13, 1993 and subsequently revised on November 10, 2008, February 6, 2016 and November 19, 2017 and the Detailed Rules for the Implementation of the Interim Regulations of the People’s Republic of China on Value-added Tax which was promulgated by the Ministry of Finance (the “MOF”) on December 25, 1993, and subsequently revised on December 15, 2008 and October 28, 2011, entities and individuals that sell goods or labor services of processing, repair or replacement, sell services, intangible assets, or immovables, or import goods within the territory of China are taxpayers of value-added tax (“VAT”), and pay VAT in accordance with law.
Regulation on PRC Value-added Tax According to the Interim Regulations of PRC on Value-added Tax, which was promulgated by the State Council on December 13, 1993 and subsequently revised on November 10, 2008, February 6, 2016 and November 19, 2017 and the Detailed Rules for the Implementation of the Interim Regulations of the People’s Republic of China on Value-added Tax which was promulgated by the Ministry of Finance (the “MOF”) on December 25, 1993, and subsequently revised on December 15, 2008 and October 28, 2011, entities and individuals that sell goods or labor services of processing, repair or replacement, sell services, intangible assets, or immovables, or import goods within the territory of China are taxpayers of value-added tax (“VAT”), and pay VAT in accordance with law.
Upon the close of the Business Combination, we acquired all of the issued and outstanding securities of Glory Star in exchange for approximately 4,620,403 of our Class A Ordinary Shares, which includes 1,000,000 Class A Ordinary Shares that were issued to the former shareholders of Glory Star because certain financial performance targets were attained for both 2019 and 2020 fiscal years. 41 As a result of the Business Combination, Sellers became the controlling shareholders of the Company.
(“CHEER Holdings”) acquired 100% of the equity interests of Glory Star from the Sellers. 47 Upon the close of the Business Combination, we acquired all of the issued and outstanding securities of Glory Star in exchange for approximately 92,408 of our Class A Ordinary Shares, which includes 20,000 Class A Ordinary Shares that were issued to the former shareholders of Glory Star because certain financial performance targets were attained for both 2019 and 2020 fiscal years.
Regulations on Foreign Investment Guidance Catalogue of Industries for Foreign Investment On June 28, 2017, the National Development and Reform Commission (the “NDRC”), and Ministry of Commerce (“MOFCOM”), promulgated the Foreign Investment Catalog which was implemented on July 28, 2017.
This section summarizes the principal PRC regulations that are relevant to our lines of business. 63 Regulations on Foreign Investment Guidance Catalogue of Industries for Foreign Investment On June 28, 2017, the National Development and Reform Commission (the “NDRC”), and Ministry of Commerce (“MOFCOM”), promulgated the Foreign Investment Catalog which was implemented on July 28, 2017.
Provisions Regarding Mergers and Acquisitions of Domestic Enterprises by Foreign Investors On August 8, 2006, six PRC regulatory agencies, including MOFCOM, the State-owned Assets Supervision and Administration Commission of the State Council, the State Administration for Taxation, the State Administration for Industry and Commerce, the CSRC and SAFE, jointly adopted the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors , or the M&A Rules, which became effective on September 8, 2006, and were amended on June 26, 2009.
The SAT Circular 7 may be determined by the tax authorities to be applicable to our offshore transactions or sale of our shares or those of our offshore subsidiaries where non-resident enterprises, being the transferors, were involved. 77 Provisions Regarding Mergers and Acquisitions of Domestic Enterprises by Foreign Investors On August 8, 2006, six PRC regulatory agencies, including MOFCOM, the State-owned Assets Supervision and Administration Commission of the State Council, the State Administration for Taxation, the State Administration for Industry and Commerce, the CSRC and SAFE, jointly adopted the Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors , or the M&A Rules, which became effective on September 8, 2006, and were amended on June 26, 2009.
This version featured more advanced and complicated algorithms and models, more powerful application capacity, and more comprehensive AI interaction functionalities to improve user experience, as well as a richer, more diverse and authentic generation effect. As of September 2024, CHEERS Telepathy supports users in 12 countries and regions. In December 2024, we released CHEERS Telepathy 2.5.
This version featured more advanced and complicated algorithms and models, more powerful application capacity, and more comprehensive AI interaction functionalities to improve user experience, as well as a richer, more diverse and authentic generation effect. In December 2024, we released CHEERS Telepathy 2.5. This upgrade provided further technical and application advancements, integrating innovative AI tools for content creators.
Furthermore, the independent operations of the CHEERS e-Mall and CHEERS video platforms continue to be key growth drivers for us, through the complemental nature of the unique technology, premium content, and strong consumer data insight made possible by our content-driven ecosystem.
We believe that the independent operation of the CHEERS e-Mall platform will allow it to be better integrated with other applications, leading to improved business performances and growth. 55 Furthermore, the independent operations of the CHEERS e-Mall and CHEERS video platforms continue to be key growth drivers for us, through the complemental nature of the unique technology, premium content, and strong consumer data insight made possible by our content-driven ecosystem.
For example, online user numbers tend to be higher during holidays and end of the year, and advertising revenues tend to be higher at the end of the year. 54 Aside from fluctuations in the level of advertising spending resulting from changes in the overall economic and market conditions in China, our revenues are affected by seasonal fluctuations in business and consumer spending that also affect the level of advertising spending over time in China.
Aside from fluctuations in the level of advertising spending resulting from changes in the overall economic and market conditions in China, our revenues are affected by seasonal fluctuations in business and consumer spending that also affect the level of advertising spending over time in China.
GOVERNMENT REGULATIONS Regulations of Our Industry The PRC government imposes extensive controls and regulations over the e-commerce industry and media industry, including television, advertising, media content production. This section summarizes the principal PRC regulations that are relevant to our lines of business.
GOVERNMENT REGULATIONS Regulations of Our Industry The PRC government imposes extensive controls and regulations over the e-commerce industry and media industry, including television, advertising, media content production.
According to the Opinions of the Ministry of Commerce on Promoting the Regularized Development of the E-Commerce promulgated by MOFCOM in 2007, which required to, among others, regularize the information release and transmission behaviors of all parties concerned to online trading, applaud legal, regularized, fair and equitable online marketing, electronic contracting, after-sale services and other e-commerce trading acts, prevent and settle various kinds of trading disputes, regularize electronic payment acts and ensuring the safe flow of funds. 56 Implementing Opinions on Promoting E-Commerce Application was promulgated by MOFCOM in October 2013, which aims to further promote the development of e-commerce, guide the healthy and speedy development of network retailing, strengthen the development of e-commerce for rural villages and agricultural products, support the development of urban community e-commerce application system and promote innovative application of cross-border e-commerce.
According to the Opinions of the Ministry of Commerce on Promoting the Regularized Development of the E-Commerce promulgated by MOFCOM in 2007, which required to, among others, regularize the information release and transmission behaviors of all parties concerned to online trading, applaud legal, regularized, fair and equitable online marketing, electronic contracting, after-sale services and other e-commerce trading acts, prevent and settle various kinds of trading disputes, regularize electronic payment acts and ensuring the safe flow of funds.
We charge third-party merchants on our CHEERS e-Mall platform a service fee and a commission for the sales of their products. While the CHEERS video platform has maintained high business growth for us, the e-Mall has also expanded our presence in video content-driven e-commerce industry and has become another growth driver for us.
While the CHEERS video platform has maintained high business growth for us, the e-Mall has also expanded our presence in video content-driven e-commerce industry and has become another growth driver for us.
The Trial Administrative Measures also provides that if the issuer both meets the following criteria, the overseas securities offering and listing conducted by such issuer will be deemed as indirect overseas offering by PRC domestic companies: (i) 50% or more of any of the issuer’s operating revenue, total profit, total assets or net assets as documented in its audited consolidated financial statements for the most recent fiscal year is accounted for by domestic companies; and (ii) the main parts of the issuer’s business activities are conducted in mainland China, or its main place(s) of business are located in mainland China, or the majority of senior management staff in charge of its business operations and management are PRC citizens or have their usual place(s) of residence located in mainland China.
Upon occurrence of any material event, such as change of control, investigations or sanctions imposed by overseas securities regulatory agencies or other relevant competent authorities, change of listing status or transfer of listing segment, or voluntary or mandatory delisting, after an issuer has offered and listed securities in an overseas market, the issuer shall submit a report thereof to CSRC within 3 working days after the occurrence and public disclosure of such event. 78 The Trial Administrative Measures also provides that if the issuer both meets the following criteria, the overseas securities offering and listing conducted by such issuer will be deemed as indirect overseas offering by PRC domestic companies: (i) 50% or more of any of the issuer’s operating revenue, total profit, total assets or net assets as documented in its audited consolidated financial statements for the most recent fiscal year is accounted for by domestic companies; and (ii) the main parts of the issuer’s business activities are conducted in mainland China, or its main place(s) of business are located in mainland China, or the majority of senior management staff in charge of its business operations and management are PRC citizens or have their usual place(s) of residence located in mainland China.
Leveraging the popularity of our professionally-produced content and distribution networks, we drive viewing audiences to our CHEERS ecosystem to convert them as users of our online video streaming services and as customers to our e-Mall and online games.
Leveraging the popularity of our professionally-produced content and distribution networks, we drive viewing audiences to our CHEERS ecosystem to convert them as users of our online video streaming services and as customers to our e-Mall and online games. 54 Since our establishment, we have focused on developing an ecosystem for our users that incorporates quality content, e-commerce, social networking and gaming.
As of December 31, 2024, we had fifty-six (56) registered software copyrights and fourteen (14) artwork copyrights.
As of December 31, 2025, we had seventy (70) registered software copyrights and fourteen (14) artwork copyrights.
Certain payments from Xing Cui Can and/or Horgos to WFOE are subject to PRC taxes, including enterprise income taxes, VAT and certain other taxes, as the case maybe. As of the date of this annual report, our PRC subsidiary has not made any transfers or distributions.
Certain payments from Xing Cui Can and/or Horgos to WFOE are subject to PRC taxes, including enterprise income taxes, VAT and certain other taxes, as the case maybe.
Series TV Shows In February 2017, we started production of our series TV shows, which contain six (6) lifestyle shows, including Cheers Foodie, Cheers Health, Cheers Fashion, Cheers Baby, Cheers Space and Cheers World, each episode is 30 minutes in length.
Each user can enter personalized scenarios, protected by robust privacy measures, and engage in transactions with the utmost confidentiality. 58 Series TV Shows In February 2017, we started production of our series TV shows, which contain six (6) lifestyle shows, including Cheers Foodie, Cheers Health, Cheers Fashion, Cheers Baby, Cheers Space and Cheers World, each episode is 30 minutes in length.
With the independent operation of the e-Mall, we will look to deploy more resources to our e-commerce business, expand into the cross-border e-commerce market, and achieve greater business autonomy. We believe that the independent operation of the CHEERS e-Mall platform will allow it to be better integrated with other applications, leading to improved business performances and growth.
With the independent operation of the e-Mall, we will look to deploy more resources to our e-commerce business, expand into the cross-border e-commerce market, and achieve greater business autonomy.
The New Administrative Rules Regarding Overseas Listings refine the regulatory system for domestic company’s overseas offering and listing by subjecting both direct and indirect overseas offering and listing activities to the filing-based administration, and clearly defines the circumstances where provisions for direct and indirect overseas offering and listing apply and relevant regulatory requirements. 67 According to the New Administrative Rules Regarding Overseas Listings, among other things, a domestic company in the PRC that seeks to offer and list securities in overseas markets shall fulfill the filing procedure with the CSRC as per requirement of the Trial Administrative Measures.
According to the New Administrative Rules Regarding Overseas Listings, among other things, a domestic company in the PRC that seeks to offer and list securities in overseas markets shall fulfill the filing procedure with the CSRC as per requirement of the Trial Administrative Measures.
The address of the SEC’s Internet site is http://www.sec.gov. We maintain an Internet site at http://gsmg.co. However, information contained in, or that can be accessed through our website or any other website cited in this annual report is not part of this annual report.
However, information contained in, or that can be accessed through our website or any other website cited in this annual report is not part of this annual report.
Since our establishment, we have focused on developing an ecosystem for our users that incorporates quality content, e-commerce, social networking, gaming and NFT. These core elements have formed the basis of our future metaverse platform and continues to provide us a strong competitive advantage in realizing our new strategic objectives.
These core elements have formed the basis of our future metaverse platform and continues to provide us a strong competitive advantage in realizing our new strategic objectives.
Prior to the incorporation of Glory Star, on August 31, 2017 (the “Acquisition Date”), Horgos completed the acquisition of 100% of the equity interest of Leshare Star (Beijing) Technology Co., Ltd.
Through a series of contractual agreements, WFOE is deemed to control Horgos and have rights to consolidate all of Horgos’s audited financial results. 48 Prior to the incorporation of Glory Star, on August 31, 2017 (the “Acquisition Date”), Horgos completed the acquisition of 100% of the equity interest of Leshare Star (Beijing) Technology Co., Ltd.
We plan to continue to develop and implement our new business initiatives by investing in ongoing research on the latest innovative technologies. CHEERS Video CHEERS Video app is a professionally-produced and curated media platform that engages users with high-quality content, and continues to develop lifestyle short videos and interactive live-broadcasting.
CHEERS Video CHEERS Video app is a professionally-produced and curated media platform that engages users with high-quality content, and continues to develop lifestyle short videos and interactive live-broadcasting. We have upgraded the platform to include UGC rights management system.
Through the transformative power of this integrated ecosystem, the next generation of e-commerce emerges, connecting diverse facets of online and offline shopping contexts. Each user can enter personalized scenarios, protected by robust privacy measures, and engage in transactions with the utmost confidentiality.
Through the transformative power of this integrated ecosystem, the next generation of e-commerce emerges, connecting diverse facets of online and offline shopping contexts.
The launch of CheerChat demonstrates our emphasis on continuing to apply innovative technologies to our business model and create further value through strategic investment in research and development. This long-term vision enables us to maintain our leading position in the new media industry. 50 CHEERS Metaverse In December 2023, we announced a groundbreaking advancement in our metaverse retail strategy.
This long-term vision enables us to maintain our leading position in the new media industry. CHEERS Metaverse In December 2023, we announced a groundbreaking advancement in our metaverse retail strategy.
The laws and regulations of the PRC do not currently have any material impact on transfer of cash from Glory Star to Glory Star HK or from Glory Star HK to Glory Star.
Under the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect of dividends paid by us. The laws and regulations of the PRC do not currently have any material impact on transfer of cash from Glory Star to Glory Star HK or from Glory Star HK to Glory Star.
Moreover, the domain names and registered trademarks used by an operating company providing value-added telecommunications service must be legally owned by such company and/or our shareholders.
Moreover, the domain names and registered trademarks used by an operating company providing value-added telecommunications service must be legally owned by such company and/or our shareholders. In addition, such company’s operation premises and equipment must comply with our approved ICP License, and such company should improve our internal internet and information security standards and emergency management procedures.
The Business Combination was accounted for as a reverse merger, wherein Glory Star is considered the acquirer for accounting and financial reporting purposes. We were incorporated as an exempted company under the laws of the Cayman Islands on February 5, 2018 under the name TKK Symphony Acquisition Corporation.
We were incorporated as an exempted company under the laws of the Cayman Islands on February 5, 2018 under the name TKK Symphony Acquisition Corporation.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeNet Income As a result of the foregoing, we had a net income of approximately $26.0 million in the year ended December 31, 2024, as compared to a net income of approximately $30.5 million in the year ended December 31, 2023. 77 For the years ended December 31, 2023 and 2022 (In U.S. dollars in thousands) For the Years Ended December 31, 2023 2022 Change $ % $ % $ % Revenues 152,327 100.00 157,079 100.00 (4,752 ) (3.03 ) Operating expenses: Cost of revenues (39,549 ) (25.96 ) (40,580 ) (25.83 ) 1,031 (2.54 ) Selling and marketing (76,200 ) (50.02 ) (82,534 ) (52.54 ) 6,334 (7.67 ) General and administrative (5,658 ) (3.71 ) (5,908 ) (3.76 ) 250 (4.23 ) Research and development (1,635 ) (1.07 ) (1,331 ) (0.85 ) (304 ) 22.84 Total operating expenses (123,042 ) (80.77 ) (130,353 ) (82.99 ) 7,311 (5.61 ) Income from operations 29,285 19.23 26,726 17.01 2,559 9.57 Other income (expenses): Interest income (expense), net 3 0.00 (93 ) (0.06 ) 96 (103.23 ) Change in fair value of warrant liability 86 0.06 (62 ) (0.04 ) 148 (238.71 ) Other income (expense), net 1,215 0.80 282 0.18 933 330.85 Total other income 1,304 0.86 127 0.08 1,177 926.77 Income before income taxes 30,589 20.08 26,853 17.10 3,736 13.91 Income tax expense (61 ) (0.04 ) (413 ) (0.26 ) 352 (85.23 ) Net income 30,528 20.04 26,440 16.83 4,088 15.46 Revenues For the years ended December 31, 2023 and 2022, we primarily generated revenues from three revenue streams: advertising, copyright licensing, and CHEERS e-Mall market service.
Biggest changeFor the years ended December 31, 2025 and 2024 (In U.S. dollars in thousands) For the Years Ended December 31, 2025 2024 Change $ % $ % $ % Revenues 148,835 100.00 147,196 100.00 1,639 1.1 Operating expenses: Cost of revenues (43,209 ) (29.03 ) (39,388 ) (26.76 ) (3,821 ) 9.7 Selling and marketing (69,441 ) (46.66 ) (75,289 ) (51.15 ) 5,848 (7.8 ) General and administrative (4,724 ) (3.17 ) (3,499 ) (2.38 ) (1,225 ) 35.0 Research and development (5,173 ) (3.48 ) (3,428 ) (2.33 ) (1,745 ) 50.9 Total operating expenses (122,547 ) (82.34 ) (121,604 ) (82.62 ) (943 ) 0.8 Income from operations 26,288 17.66 25,592 17.38 696 2.7 Other (expenses) income: Interest income, net 69 0.05 262 0.18 (193 ) (73.7 ) Other (expenses) income, net (663 ) (0.45 ) 80 0.05 (743 ) (928.8 ) Total other (expenses) income (594 ) (0.40 ) 342 0.23 (936 ) (273.7 ) Income before income taxes 25,694 17.26 25,934 17.61 (240 ) (0.9 ) Income tax (expense) benefit (73 ) (0.05 ) 34 0.02 (107 ) (314.7 ) Net income 26,621 17.21 25,968 17.63 (347 ) (1.3 ) Revenues For the years ended December 31, 2025 and 2024, we primarily generated revenues from three revenue streams: advertising, copyright licensing, and CHEERS e-Mall market service.
Cost of revenues consists primarily of production cost of TV series, short stream video, live stream and network drama, labor cost and related benefits, payments to various channel owners for broadcast, purchase cost of goods and copyrights and costs associated with the operation of our online game and shopping platform CHEERS App such as bandwidth cost and amortization of intangible assets.
Cost of revenues consists primarily of production cost of TV series, short stream video, live stream and network drama, labor cost and related benefits, payments to various channel owners for broadcast, purchase cost of goods and copyrights and costs associated with the operation of our online game and shopping platform CHEERS App such as bandwidth cost and amortization of intangible assets.
Investing Activities Net cash used in investing activities was approximately $24.9 million for the year ended December 31, 2024, which was primarily incurred for purchase of intangible assets of approximately $24.9 million. Net cash used in investing activities was approximately $3,000 for the year ended December 31, 2023, which was primarily incurred for purchase of property and equipment.
Net cash used in investing activities was approximately $24.9 million for the year ended December 31, 2024, which was primarily incurred for purchase of intangible assets of approximately $24.9 million. Net cash used in investing activities was approximately $3,000 for the year ended December 31, 2023, which was primarily incurred for purchase of property and equipment.
Such financing may include the use of additional debt or the sale or additional securities. Any financing, which involves the sale of equity securities or instruments that are convertible into equity securities, could result in immediate and possibly significant dilutions to our existing shareholders. Cash Flows The following table summarizes our cash flows for the years indicated.
Such financing may include the use of additional debt or the sale or additional securities. Any financing, which involves the sale of equity securities or instruments that are convertible into equity securities, could result in immediate and possibly significant dilutions to our existing shareholders. 90 Cash Flows The following table summarizes our cash flows for the years indicated.
You should read the following description of critical accounting policies, judgments and estimates in conjunction with our consolidated financial statements and other disclosures included in this report. 82 A list of critical accounting policies, judgements and estimates that are relevant to us is included in note 2 of our consolidated financial statements included elsewhere in this report.
You should read the following description of critical accounting policies, judgments and estimates in conjunction with our consolidated financial statements and other disclosures included in this report. A list of critical accounting policies, judgements and estimates that are relevant to us is included in note 2 of our consolidated financial statements included elsewhere in this report.
We expect to further expand our customers base with our efforts to enhance brand recognition and user traffic generation, leading to more exposure and high popularity of our Apps. 76 Operating expenses Operating expenses consists of cost of revenues, selling and marketing, general and administrative and research and development expense.
We expect to further expand our customers base with our efforts to enhance brand recognition and user traffic generation, leading to more exposure and high popularity of our Apps. Operating expenses Operating expenses consists of cost of revenues, selling and marketing, general and administrative and research and development expense.
Recently issued accounting pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in note 2 of our consolidated financial statements included elsewhere in this report.
Recently issued accounting pronouncements A list of recently issued accounting pronouncements that are relevant to us is included in note 2 of our consolidated financial statements included elsewhere in this report. 93
Class A Ordinary Shares and Class B Ordinary Shares shall at all times vote together as one class, and each Class A Ordinary Share shall be entitled to one (1) vote and each Class B Ordinary Share shall be entitled to one hundred (100) votes.
Class A Shares and Class B Shares shall at all times vote together as one class, and each Class A Share shall be entitled to one (1) vote and each Class B Share shall be entitled to one hundred (100) votes.
In February 2024, we launched the Year of the Dragon Edition of CHEERS Telepathy. This major upgrade included substantial advancements in model architecture, computing power, and content creation capabilities, including painting, text-to-image, image-to-image, commercial scenarios, dialogue, and long-form text generation. In June 2024, we released CHEERS Telepathy 2.0.
Operating activities In February 2024, we launched the Year of the Dragon Edition of CHEERS Telepathy. This major upgrade included substantial advancements in model architecture, computing power, and content creation capabilities, including painting, text-to-image, image-to-image, commercial scenarios, dialogue, and long-form text generation. In June 2024, we released CHEERS Telepathy 2.0.
We expect to further expand our customers base with our efforts to enhance brand recognition and user traffic generation, leading to more exposure and high popularity of our Apps. 78 Operating expenses Operating expenses consists of cost of revenues, selling and marketing, general and administrative and research and development expense.
We expect to further expand our customers base with our efforts to enhance brand recognition and user traffic generation, leading to more exposure and high popularity of our Apps. 87 Operating expenses Operating expenses consists of cost of revenues, selling and marketing, general and administrative and research and development expense.
Substantially all of our cash and cash equivalents as of December 31, 2024 were held in China, of which all are denominated in Renminbi (RMB). In addition, we are a holding company with no material operations of our own. We conduct our operations primarily through our subsidiaries and VIEs in China.
Substantially all of our cash and cash equivalents as of December 31, 2025 were held in China, of which all are denominated in Renminbi (RMB). In addition, we are a holding company with no material operations of our own. We conduct our operations primarily through our subsidiaries and VIEs in China.
We do not have any variable interests in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us. Capital Expenditures Our capital expenditures were approximately $24.9 million, $3,000 and $8.0 million for the years ended December 31, 2024, 2023 and 2022, respectively.
We do not have any variable interests in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us. 92 Capital Expenditures Our capital expenditures were approximately $10.8 million, $24.9 million and $3,000 for the years ended December 31, 2025, 2024 and 2023, respectively.
In the years ended December 31, 2024, 2023 and 2022, our research and development expenditures were approximately $3.4 million, $1.6 million and $1.3 million, respectively. In addition, intangible asset was approximately $40.5 million and $20.3 million as of December 31, 2024 and 2023, respectively. The increase in intangible assets was a result of the capitalization of research and development expenditures.
In the years ended December 31, 2025, 2024 and 2023, our research and development expenditures were approximately $5.2 million, $3.4 million and $1.6 million, respectively. In addition, intangible asset was approximately $56.8 million and $40.5 million as of December 31, 2025 and 2024, respectively. The increase in intangible assets was a result of the capitalization of research and development expenditures.
This consisted primarily of (i) net income of approximately $26.0 million adjusted for non-cash depreciation and amortization expense of approximately $3.8 million and share-based compensation expenses of approximately $1.7 million, and (ii) net changes in our operating assets and liabilities, principally consisting of a decrease of accounts receivable approximately $1.9 million because we improved collection from customers, a decrease of other tax payable of approximately $2.3 million with an increase of payment of value-added tax expenses, and an decrease of accounts payable of approximately $7.4 million because we improved payment process.
This consisted primarily of (i) net income of approximately $26.0 million adjusted for non-cash depreciation and amortization expense of approximately $3.8 million and share-based compensation expenses of approximately $1.7 million, and (ii) net changes in our operating assets and liabilities, principally consisting of a decrease of accounts receivable approximately $1.9 million because we improved collection from customers, a decrease of other tax payable of approximately $2.3 million with an increase of payment of value-added tax expenses, and an decrease of accounts payable of approximately $7.4 million because we improved payment process. 91 Net cash provided by operating activities was approximately $42.2 million for the year ended December 31, 2023.
Financing Activities Net cash provided by financing activities was approximately $10.6 million for the year ended December 31, 2024, which was primarily attributable to capital contribution of approximately $5.5 million from shareholders and proceeds of approximately $12.5 million from short-term bank loans, partially offset by repayments of short-term bank loans of approximately $6.9 million and repayment of borrowings of approximately $0.5 million to a related party. 81 Net cash provided by financing activities was approximately $82.0 million for the year ended December 31, 2023, which was primarily attributable to proceeds of $80.0 million from issuance of ordinary shares in connection with a private placement, proceeds of approximately $4.7 million and $1.4 million, respectively, from short-term bank loans and long-term bank loans, borrowings of approximately $1.6 million from related parties, partially offset by repayments of short-term bank loans of $4.8 million.
Net cash provided by financing activities was approximately $82.0 million for the year ended December 31, 2023, which was primarily attributable to proceeds of $80.0 million from issuance of ordinary shares in connection with a private placement, proceeds of approximately $4.7 million and $1.4 million, respectively, from short-term bank loans and long-term bank loans, borrowings of approximately $1.6 million from related parties, partially offset by repayments of short-term bank loans of $4.8 million.
Net Income As a result of the foregoing, we had a net income of approximately $30.5 million in the year ended December 31, 2023, as compared to a net income of approximately $26.4 million in the year ended December 31, 2022. 79 B.
Net Income As a result of the foregoing, we had a net income of approximately $26.0 million in the year ended December 31, 2024, as compared to a net income of approximately $30.5 million in the year ended December 31, 2023. B.
However our gross margin decreased which was primarily due to decrease in the service fees charged to our advertising customers in the year of 2024. We expect to achieve a further increase in advertising revenues with our continuous investment in advertising business. However, it may take time to make further investments before we generate revenues.
However our gross margin decreased which was primarily due to decrease in the service fees to attract increasing orders placed by our advertising customers in the year of 2025. We expect to achieve a further increase in advertising revenues with our continuous investment in advertising business. However, it may take time to make further investments before we generate revenues.
Our sales and marketing expenses primarily consist of salaries and benefits of sales department, user acquisition expense, advertising fee, travelling expense and CHEERS e-Mall marketing expense. Our sales and marketing expenses decreased by approximately $0.9 million, to approximately $75.3 million for the year ended December 31, 2024 from approximately $76.2 million for the year ended December 31, 2023.
Our sales and marketing expenses primarily consist of salaries and benefits of sales department, user acquisition expense, advertising fee, travelling expense and CHEERS e-Mall marketing expense. Our sales and marketing expenses decreased by approximately $5.9 million, from approximately $75.3 million for the year ended December 31, 2024 to approximately $69.4 million for the year ended December 31, 2025.
Net cash provided by operating activities was approximately $7.7 million for the year ended December 31, 2022.
Net cash provided by operating activities was approximately $22.9 million for the year ended December 31, 2024.
For the Years Ended December 31, (In U.S. dollars in thousands) 2024 2023 2022 Net cash provided by operating activities $ 22,875 $ 42,174 $ 7,739 Net cash used in investing activities (24,862 ) (3 ) (7,989 ) Net cash provided by financing activities 10,551 82,021 508 Effect of exchange rate changes (5,429 ) (149 ) (7,078 ) Net increase (decrease) in cash and cash equivalents 3,135 124,043 (6,820 ) Cash, cash equivalents and restricted cash, at beginning of year 194,525 70,482 77,302 Cash, cash equivalents and restricted cash, at end of year $ 197,660 $ 194,525 $ 70,482 80 We primarily fund our operations from our net revenues, bank loans and equity financing through private placements.
For the Years Ended December 31, (In U.S. dollars in thousands) 2025 2024 2023 Net cash provided by operating activities $ 25,025 $ 22,875 $ 42,174 Net cash used in investing activities (7,797 ) (24,862 ) (3 ) Net cash provided by financing activities 17,824 10,551 82,021 Effect of exchange rate changes 9,370 (5,429 ) (149 ) Net increase in cash and cash equivalents 44,422 3,135 124,043 Cash and cash equivalents, at beginning of year 197,660 194,525 70,482 Cash and cash equivalents, at end of year $ 242,082 $ 197,660 $ 194,525 We primarily fund our operations from our net revenues, bank loans and equity financing through private placements.
Immediately following the Share Consolidation, the authorized share capital of the Company to be $20,200 divided into 20,000,000 ordinary shares of a par value of $0.001 each and 2,000,000 preferred shares of a par value of $0.0001 each.
Immediately following the Share Consolidation, the authorized share capital of the Company to be US$500,700 divided into 10,000,000 Class A ordinary shares of a par value of US$0.05 each; 500,000 Class B ordinary shares of a par value of US$0.001 each; and 2,000,000 preferred shares of a par value of US$0.0001 each.
Income tax expense, net Income tax expenses for the year ended December 31, 2023 were approximately $61,000 because we reversed certain deferred tax assets arising from allowance for doubtful receivables as a result of collection of these receivables from our customers.
Income tax (expense) benefits Income tax expenses for the year ended December 31, 2025 were approximately $73,000 because we reversed deferred tax assets arising from allowance for expected credit losses of accounts receivables doubtful receivables as a result of collection of these receivables from our customers.
The Company’s consecutive recognition as both National High-Tech Enterprise and Specialized and Innovative Enterprise specializing in advanced technologies underscores its leadership in technological innovation, robust market competitiveness, and dominant position within the media technology sector. These accolades highlight the Company’s ability to deliver cutting-edge, unique products through specialized expertise.
The Company’s consecutive recognition as both National High-Tech Enterprise and Specialized and Innovative Enterprise specializing in advanced technologies underscores its leadership in technological innovation, robust market competitiveness, and dominant position within the media technology sector.
Liquidity and Capital Resources As of December 31, 2024 and 2023, our principal sources of liquidity were cash and cash equivalents of approximately $197.7 million and $194.2 million, respectively. Working capital at December 31, 2024 was approximately $265.7 million.
Liquidity and Capital Resources As of December 31, 2025 and 2024, our principal sources of liquidity were cash and cash equivalents of approximately $242.1 million and $197.7 million, respectively. Working capital at December 31, 2025 was approximately $334.8 million.
Our research and development expenses consist primarily of salaries and benefits for our research and development department. Research and development expenses for the years ended December 31, 2023 and 2022 were approximately $1.6 million and approximately $1.3 million, respectively.
Our research and development expenses consist primarily of salaries and benefits for our research and development department. Research and development expenses for the years ended December 31, 2025 and 2024 were approximately $5.2 million and approximately $3.4 million, respectively.
For the Years Ended December 31, 2024 2023 2022 Net revenues: CHEERS App Internet Business $ 135,796 $ 141,005 $ 144,045 Traditional Media Business 11,400 11,322 13,034 Total consolidated net revenues $ 147,196 $ 152,327 $ 157,079 Operating income: CHEERS App Internet Business $ 25,218 $ 27,108 $ 24,510 Traditional Media Business 2,118 2,177 2,218 Total segment operating income 27,336 29,285 26,728 Unallocated item (1) (1,744 ) - (2 ) Total consolidated operating income $ 25,592 $ 29,285 $ 26,726 * The unallocated item for the years ended December 31, 2024, 2023 and 2022 presents the share-based compensation for employees, which is not allocated to segments. 75 A.
For the Years Ended December 31, 2025 2024 2023 Net revenues: Cheers App Internet Business $ 137,482 $ 135,796 $ 141,005 Traditional Media Business 11,353 11,400 11,322 Total consolidated net revenues $ 148,835 $ 147,196 $ 152,327 Operating income: Cheers APP Internet Business $ 27,450 $ 25,218 $ 27,108 Traditional Media Business 2,267 2,118 2,177 Total segment operating income 29,717 27,336 29,285 Unallocated item (1) (3,429 ) (1,744 ) - Total consolidated operating income $ 26,288 $ 25,592 $ 29,285 * The unallocated item for the years ended December 31, 2025, 2024 and 2023 presents the share-based compensation for employees, which is not allocated to segments. 86 A.
During the years ended December 31, 2022, our account receivables increased and we have had to supplement our cash flow. For the years ended December 31, 2024 and 2023, our accounts receivable decreased by approximately $4.1 million and $16.9 million, respectively. We intend to continue focusing on timelier collections of account receivable which should enhance our cash flows.
For the years ended December 31, 2025, 2024 and 2023, our accounts receivable decreased by approximately $1.5 million, $1.9 million and $15.2 million, respectively. We intend to continue focusing on timelier collections of account receivable which should enhance our cash flows.
Share Consolidation On November 24, 2023, the Company effected a share consolidation at a ratio of one-for-tenth (10) ordinary shares with a par value of $0.0001 each in the Company’s issued and unissued share capital into one ordinary share with a par value of approximately $0.001 (“the Share Consolidation”).
Share Consolidation On December 22, 2025, the Company effected a share consolidation at a ratio of one-for-fiftieth (50) ordinary shares with a par value of US$0.0001 each in the Company’s issued and unissued share capital into one ordinary share with a par value of US$0.05 (“the Share Consolidation”).
Charter Amendment — Adoption of Dual-Class Share Structure On September 4, 2024, the Company effected the increase of the Company’s authorized share capital as from US$200,200 divided into 200,000,000 ordinary shares of a par value of US$0.001 each and 2,000,000 preferred shares of a par value of US$0.0001 each; to US$200,700 divided into 200,000,000 Class A ordinary shares of a par value of US$0.001 each (the “Class A Ordinary Shares”), 500,000 Class B ordinary shares of a par value of US$0.001 each (the “Class B Ordinary Shares”) and 2,000,000 preferred shares of a par value of US$0.0001 each; by the creation of 500,000 Class B ordinary shares of a par value of US$0.001 each.
These accolades highlight the Company’s ability to deliver cutting-edge, unique products through specialized expertise. 84 Financing and investing activities On September 4, 2024, the Company effected the increase of the Company’s authorized share capital as from US$200,200 divided into 200,000,000 ordinary shares of a par value of US$0.001 each and 2,000,000 preferred shares of a par value of US$0.0001 each; to US$200,700 divided into 200,000,000 Class A ordinary shares of a par value of US$0.001 each (the “Class A Shares”), 500,000 Class B ordinary shares of a par value of US$0.001 each (the “Class B Shares”) and 2,000,000 preferred shares of a par value of US$0.0001 each; by the creation of 500,000 Class B ordinary shares of a par value of US$0.001 each.
Class B Ordinary Shares are not convertible into Class A Ordinary Shares, and may be redeemed by the Company at par value at the option of the holder.
Class B Shares are not convertible into Class A Shares, and may be redeemed by the Company at par value at the option of the holder. The Company has retroactively adjusted all share and per share data from ordinary share to Class A Ordinary Shares for all periods presented.
Key Factors that Affect Operating Results We believe that our results of operations are significantly affected by the following key factors: Ability to maintain and grow users and user time spent on the CHEERS App Our success depends on our ability to maintain and grow users and user time spent on the CHEERS App.
The Company has retroactively adjusted all share and per share data from ordinary share to Class A Ordinary Shares for all periods presented. 85 Key Factors that Affect Operating Results We believe that our results of operations are significantly affected by the following key factors: Ability to maintain and grow users and user time spent on the CHEERS App Our success depends on our ability to maintain and grow users and user time spent on the CHEERS App.
We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all. Operating Activities Net cash provided by operating activities was approximately $22.9 million for the year ended December 31, 2024.
The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that might restrict our operations. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all. Operating Activities Net cash provided by operating activities was approximately $25.0 million for the year ended December 31, 2025.
Producing high-quality original content is costly and time-consuming and typically requires a long period of time in order to realize a return on investment, if at all. 74 Ability to provide our users with compelling content choices In addition to our content production for television shows, we have experienced significant user growth for our mobile and on-line video and e-commerce products over the past several years.
Ability to provide our users with compelling content choices In addition to our content production for television shows, we have experienced significant user growth for our mobile and on-line video and e-commerce products over the past several years.
We believe that our current cash and cash equivalents and our anticipated cash flows from operations will be sufficient to meet our anticipated working capital requirements and capital expenditures for the next 12 months.
As of December 31, 2025, the Company has issued 2,900,000 Class A Ordinary Shares in the offering. We believe that our current cash and cash equivalents and our anticipated cash flows from operations will be sufficient to meet our anticipated working capital requirements and capital expenditures for the next 12 months.
Net cash provided by financing activities was approximately $0.5 million for the year ended December 31, 2022, which was primarily attributable to the repayments of bank loans and loan origination fees of approximately $6.3 million due to the maturity of bank loans; offset by the capital contribution of approximately $0.7 million from Glory Star Group shareholders and the amount of approximately $6.1 million from short term borrowings.
Net cash provided by financing activities was approximately $10.6 million for the year ended December 31, 2024, which was primarily attributable to capital contribution of approximately $5.5 million from shareholders and proceeds of approximately $12.5 million from short-term bank loans, partially offset by repayments of short-term bank loans of approximately $6.9 million and repayment of borrowings of approximately $0.5 million to a related party.
Bing Zhang, the Company’s Chairman, Director, Chief Executive Officer and Chief Financial Officer. Pursuant to the Subscription Agreement, the Company agreed to issue and sell to Mr. Zhang an aggregate of 500,000 Class B Ordinary Shares of the Company, at par, for an aggregate purchase price of US$500, or US$0.001 per share (the “Share Purchase”).
Zhang an aggregate of 500,000 Class B Ordinary Shares of the Company, at par, for an aggregate purchase price of US$500, or US$0.001 per share (the “Share Purchase”).
To enhance its proposed growth, we anticipate raising capital through the issuance of equity or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that might restrict our operations.
The changes were primarily caused by changes in prepayments to our vendors for customer acquisition. To enhance its proposed growth, we anticipate raising capital through the issuance of equity or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to our shareholders.
For the years ended December 31, 2023 and 2022, 97.9% and 96.8% of our revenues derived from advertising services. Our revenues for the year ended December 31, 2023 were approximately $152.3 million, representing a decrease of approximately $4.8 million, or 3.03% from approximately $157.1 million for the year ended December 31, 2022.
For the years ended December 31, 2025 and 2024, 98.9% and 98.0% of our revenues derived from advertising services. Our revenues for the year ended December 31, 2025 were approximately $148.7 million, representing an increase of approximately $1.6 million, or 1.1% from approximately $147.2 million for the year ended December 31, 2024.
Our sales and marketing expenses primarily consist of salaries and benefits of sales department, user acquisition expense, advertising fee, travelling expense and CHEERS e-Mall marketing expense. Our sales and marketing expenses decreased by approximately $6.3 million, to approximately $76.2 million for the year ended December 31, 2023 from approximately $82.5 million for the year ended December 31, 2022.
Our sales and marketing expenses decreased by approximately $0.9 million, to approximately $75.3 million for the year ended December 31, 2024 from approximately $76.2 million for the year ended December 31, 2023.
Net cash used in investing activities was approximately $8.0 million for the year ended December 31, 2022, which was primarily due to the payments to the acquisition of intangible assets and the purchases of equipment, which was acquired to enhance the shopping, game, media functions of CHEERS App for the future growth of business and operation.
Investing Activities Net cash used in investing activities was approximately $7.8 million for the year ended December 31, 2025, which was primarily incurred for purchase of intangible assets of approximately $7.8 million.
We anticipate that the major capital expenditure in the near future is for the further enhancement of our CHEERS App.
We anticipate that the major capital expenditure in the near future is for the further enhancement of our CHEERS App. For the years ended December 31, 2025, 2024 and 2023, our prepayments and other current assets increased by approximately $14.0 million, $0.5 million and $22.3 million, respectively.
The change in cost of revenues was in line with the changes in revenues. we expect to achieve a further increase in advertising revenues with our continuous investment in advertising business. However, it may take time to make further investments before we generate revenues.
However our gross margin decreased which was primarily due to decrease in the service fees charged to our advertising customers in the year of 2024. We expect to achieve a further increase in advertising revenues with our continuous investment in advertising business.
Our cost of revenues decreased by approximately $1.0 million, or 2.54%, from approximately $40.6 million for the year ended December 31, 2022 to approximately $39.5 million for the year ended December 31, 2023.
Our cost of revenues increased by approximately $3.8 million, or 9.7%, from approximately $39.4 million for the year ended December 31, 2024 to approximately $43.2 million for the year ended December 31, 2025. The change in cost of revenues was primarily because (i) the increase was in line with the increase in revenues.
Income tax benefits for the year ended December 31, 2022 were approximately $0.4 million arising from recognition of deferred tax assets for recognition of allowance against doubtful accounts receivable.
Income tax benefits for the year ended December 31, 2024 were approximately $34,000 because we recognized deferred tax benefits arising from allowance of prepayments. 88 Net Income As a result of the foregoing, we had a net income of approximately $25.6 million in the year ended December 31, 2024, as compared to a net income of approximately $26.0 million in the year ended December 31, 2024.
Our general and administrative expenses consist primarily of salaries and benefits for members of our management and bad debt provision expense for accounts receivable and professional service fees. Our general and administrative expenses was stable at approximately $5.7 million and $5.9 million, respectively, for the year ended December 31, 2023 and 2022.
Our general and administrative expenses consist primarily of salaries and benefits for members of our management, provision of expected credit losses, impairment of intangible assets and professional service fees.
This consisted primarily of (i) net income of approximately $26.4 million, and (ii) net changes in our operating assets and liabilities, principally consisting of (a) a decrease of prepayment of approximately $16.9 million due to the decrease of the purchase of production content from third party and the increase of own produce content, and (b) an increase of accounts receivable in the amount of approximately $42.1 million as a result of the increased revenue.
This consisted primarily of (i) net income of approximately $25.6 million adjusted for non-cash depreciation and amortization expense of approximately $6.9 million, reversal of expected credit losses of approximately $2.9 million, impairment of intangible assets of approximately $1.2 million and share-based compensation expenses of approximately $3.4 million, and (ii) net changes in our operating assets and liabilities, principally consisting of a decrease of accounts receivable of approximately $1.5 million because we improved collection from customers, an increase of prepayments and other current assets of approximately $3.1 million due to increased prepayments to our vendors as a result of orders placed by our customers, and a decrease of other tax payable of approximately $6.7 million with an increase of payment of value-added tax expenses.
Other income, net Other income, net for the year ended December 31, 2023 was approximately $1.3 million, which was primarily generated from other income of approximately $1.2 million due to reversal of accounts payables due to suppliers which were liquidated.
Our general and administrative expenses increased by approximately $1.2 million, to approximately $4.7 million for the year ended December 31, 2025 from approximately $3.5 million for the year ended December 31, 2024. The change was primarily caused by impairment of software of approximately $1.2 million.
Removed
Operating activities In April 2023, we completed a major upgrade to our self-developed digital collection non-fungible tokens (“NFT”) application, CheerReal. The update is now available on both Android and iOS and comes with improved security, advanced technology, enhanced functionality, and a more user-friendly interface.
Added
On September 9, 2024, the Company closed a Subscription Agreement (the “Subscription Agreement”) with Mr. Bing Zhang, the Company’s Chairman, Director, Chief Executive Officer and Chief Financial Officer. Pursuant to the Subscription Agreement, the Company agreed to issue and sell to Mr.
Removed
In July 2023, we launched CHEERS Telepathy, a groundbreaking artificial intelligence (AI) content creation platform that incorporates multimodal functions. Powered by the Company’s intelligent cloud-based service “Polaris”, CHEERS Telepathy offers a glimpse into the future of art, by providing a stable and reliable AI content creation experience that allows for unprecedented possibilities of art and creativity.
Added
On May 12, 2025, the shareholders of the Company, at the Annual General Meeting, approved to increase the number of authorized Class A share capital of the Company from US$200,000 to US$500,000, with the authorized share capital of the Company to be US$500,000 divided into 10,000,000 Class A ordinary shares of a par value of US$0.05 each.
Removed
Financing and investing activities On April 6, 2023, the Company sent a notice of termination to the Parent (the “Notice of Termination”), notifying the Parent that the Company proposes to terminate the Merger Agreement pursuant to Section 9.1(b)(ii) of the Merger Agreement due to the Parent and the Merger Sub’s breaches of the Merger Agreement, including, but not limited to, Section 7.2(a).
Added
On October 2, 2025, the Company closed on a best efforts public offering for the sale of 253,731 units, each consisting of one Class A ordinary share of the Company, par value $0.05 per share, or in lieu thereof, a pre-funded warrant to purchase one Class A Ordinary Share (each a “Pre-Funded Warrant”), one series A warrant to purchase one Class A Ordinary Share (each a “Series A Warrant”) and one series B warrant to purchase one Class A Ordinary Share (each a “Series B Warrant”) for gross proceeds of approximately $8.5 million, before deducting placement agent fees and other estimated expenses payable by the Company, excluding the exercise of any warrants offered.
Removed
The breaches have resulted in the failure of the conditions set forth in Section 8.3(b) and cannot be cured before the termination date of the Merger Agreement. Pursuant to the Notice of Termination, as a result of such termination, the Parent is obligated to pay $1,055,897 (the “Parent Termination Fee”) to the Company.
Added
As of December 31, 2025, the Company has issued 1,533,487 Class A Ordinary Shares in the offering.
Removed
On April 7, 2023, the Parent sent a response letter to the Company (the “Response Letter”) that while it disagrees with the allegations made in the Notice of Termination, the Parent acknowledges that the Company has the right to terminate the Merger Agreement pursuant to Section 9.1(h) of the Merger Agreement and thus agrees to pay the Parent Termination Fee pursuant to Section 9.2(b)(iv) of the Merger Agreement on that basis.
Added
On November 6, 2025, the Company closed on a registered direct offering for the sale of 3,750,000 Class A Ordinary Shares, or in lieu thereof, a pre-funded warrant to purchase one Class A Ordinary Share for gross proceeds of approximately $15 million, before deducting placement agent fees and other estimated expenses payable by us, including the pre-paid exercise price of the pre-funded warrants offered.
Removed
As a result of the termination of the Merger Agreement, the proposed Going Private Transaction was terminated.. On May 9, 2023, the Company closed private placements with two (2) accredited investors (the “Investors”).
Added
As of December 31, 2025, the Company has issued 2,900,000 Class A Ordinary Shares in the offering.
Removed
The Company issued an aggregate of 2,419,355 ordinary shares of the Company, par value $0.001, at a price per share of $24.80 for gross proceeds of $60,000,000. 73 On September 5, 2023, the Company closed private placements with two (2) accredited investors (the “Investors”).
Added
Producing high-quality original content is costly and time-consuming and typically requires a long period of time in order to realize a return on investment, if at all.
Removed
The Company issued an aggregate of 806,451 ordinary shares of the Company, par value approximately $0.001, at a price per share of $24.80 for gross proceeds of $20,000,000. On November 1, 2023, the Company changed its legal name from Glory Star New Media Group Holdings Limited. to Cheer Holding, Inc.
Added
The increase in revenues was mainly caused by an increase of approximately $1.8 million in advertising revenues as a result of acquisition one major customer in the second half of 2024, leading to more revenues generated during the year of 2025. Our customers adopted cost saving strategies due to downward trend of macroeconomic environment.
Removed
In connection with the name change, the Company also changed its trading symbol for its ordinary shares from “GSMG” to “CHR” while the Company’s public warrants continued to trade under the ticker symbol “GSMGW”. Effective on November 9, 2023, the Company began on the open market under the new name and trading symbol.
Added
The decrease was mainly caused by a decrease of promotion campaigns expenses of approximately $5.6 million because we believe higher promotion campaigns expenses may not achieve expected effects given the customers adopted cost saving strategies and a decrease of approximately $0.2 million in other expenses incurred by sales persons as a result of cost saving strategies within the Company.
Removed
Our public warrants expired on 5:00 pm New York Time on February 14, 2025 and a Form 25 was filed by Nasdaq in connection with the removal of our public warrants from listing on the Nasdaq Stock Market LLC. On September 9, 2024, the Company closed a Subscription Agreement (the “Subscription Agreement”) with Mr.
Added
However, it may take time to make further investments before we generate revenues. 89 Our sales and marketing expenses primarily consist of salaries and benefits of sales department, user acquisition expense, advertising fee, travelling expense and CHEERS e-Mall marketing expense.
Removed
On December 3, 2024, the Company announced that its board of directors (the “Board”) has authorized a $50 million repurchase program of its Class A Ordinary Shares over the next 36 months. As of the date of this annual report, no Class A ordinary shares have been repurchased by the Company.
Added
For the year ended December 31, 2025, we also raised net proceeds of approximately $21.0 million from a best efforts public offering and a registered direct offering.
Removed
The change in revenues was mainly affected by depreciation of RMB during the year ended December 31, 2023, leading to a lower USD amount in translation of revenues from RMB into USD.
Added
We intend to use these proceeds for general working capital and other general corporate purposes, including, but not limited to, sales and marketing expenses for user acquisition and to develop our overseas expansion plans.
Removed
The weighted average rate for the year ended December 31, 2023 was RMB 7.0809 to approximately $1.00, depreciated from RMB 6.7261 to approximately $1.00 for the year ended December 31, 2022.
Added
On October 2, 2025, the Company closed on a best efforts public offering for the sale of 253,731 units, each consisting of one Class A ordinary share of the Company, par value $0.05 per share, or in lieu thereof, a pre-funded warrant to purchase one Class A Ordinary Share (each a “Pre-Funded Warrant”), one series A warrant to purchase one Class A Ordinary Share (each a “Series A Warrant”) and one series B warrant to purchase one Class A Ordinary Share (each a “Series B Warrant”) for gross proceeds of approximately $8.5 million, before deducting placement agent fees and other estimated expenses payable by the Company, excluding the exercise of any warrants offered.
Removed
Without the impact of fluctuation of foreign exchange rates, our revenues for the year ended December 31, 2023 increased by approximately RMB 22.1 million (approximately $3.1 million), or 2.09% as compared with the revenues for the same period of 2022.
Added
As of December 31, 2025, the Company has issued 1,533,487 Class A Ordinary Shares in the offering.
Removed
The increase in the revenues was primarily attributable an increase of advertising revenues of approximately RMB 32.4 million as a result of continuous efforts to expand our customer base through improving our content production quality, partially offset by a decrease of revenues generated from copyright licensing of approximately RMB 6.9 million because of decrease of orders for such services from our customers.
Added
On November 6, 2025, the Company closed on a registered direct offering for the sale of 3,750,000 Class A Ordinary Shares, or in lieu thereof, a pre-funded warrant to purchase one Class A Ordinary Share for gross proceeds of approximately $15 million, before deducting placement agent fees and other estimated expenses payable by us, including the pre-paid exercise price of the pre-funded warrants offered.
Removed
Similar to the changes in revenues, the decrease in cost of revenues was primarily caused by depreciation of RMB during the year ended December 31, 2023, leading to a lower USD amount in translation of revenues from RMB into USD.
Added
Financing Activities Net cash provided by financing activities was approximately $17.8 million for the year ended December 31, 2025, which was primarily attributable to proceeds of $21.0 million from issuance of ordinary shares in connection with a private placements, proceeds of approximately $7.7 million from short-term bank loans and proceeds of approximately $1.7 million from related parties, partially offset by repayments of short-term bank loans of approximately $12.5 million.
Removed
Without the impact of fluctuation of foreign exchange rates, our revenues for the year ended December 31, 2023 increased by approximately RMB 7.1 million (approximately $1.0 million), or 2.60% as compared with the revenues for the same period of 2022.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

33 edited+14 added−11 removed32 unchanged
Biggest changeIn computing the number of Ordinary Shares beneficially owned by a person listed below and the percentage ownership of such person, Ordinary Shares underlying options, warrants, or convertible securities held by each such person that are exercisable or convertible within 60 days of the date of this annual report are deemed outstanding, but are not deemed outstanding for computing the percentage ownership of any other person.
Biggest changeIn computing the number of Ordinary Shares beneficially owned by a person listed below and the percentage ownership of such person, Ordinary Shares underlying options, warrants, or convertible securities held by each such person that are exercisable or convertible within 60 days of the date of this annual report are deemed outstanding, but are not deemed outstanding for computing the percentage ownership of any other person. 100 Class A Ordinary Shares Percentage of Beneficial Ownership of Class A Ordinary Shares Class B Ordinary Shares Percentage of Beneficial Ownership of Class B Ordinary Shares Percentage of Aggregate Voting Power** Name and Address (1) of Beneficial Owner Number % Number % % Directors and Officers Bing Zhang (2) 39,426 * % 500,000 100.0 % 91.5 % Jia Lu (3) 13,109 * - - * Ke Chen 4 * - - * Zhihong Tan 4 * - - * Yong Li 4 * - - * All directors and executive officers as a group (five individuals): 52,547 1.1 % 500,000 100.0 % 91.5 % 5% or more holder(s) - - Brueckner Frank Ulrich (4) 560,024 12.0 % - - 1.0 % Michael Bigger (5) 275,340 5.9 % - - * * Less than 1% ** For each person and group included in this column, percentage of voting power is calculated by dividing the voting power beneficially owned by such person or group by the voting power of all of our outstanding Class A Ordinary Shares and Class B Ordinary Shares voting together as a single class.
The audit committee’s duties, which are specified in our Audit Committee Charter, include, but are not limited to: ● reviewing and discussing with management and the independent auditor the annual audited financial statements, and recommending to the board whether the audited financial statements should be included in our annual report; ● discussing with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of our financial statements; 85 ● discussing with management major risk assessment and risk management policies; ● monitoring the independence of the independent auditor; ● verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law; ● reviewing and approving all related-party transactions; ● inquiring and discussing with management our compliance with applicable laws and regulations; ● pre-approving all audit services and permitted non-audit services to be performed by our independent auditor, including the fees and terms of the services to be performed; ● appointing or replacing the independent auditor; ● determining the compensation and oversight of the work of the independent auditor (including resolution of disagreements between management and the independent auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work; ● establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding our financial statements or accounting policies; and ● approving reimbursement of expenses incurred by our management team in identifying potential target businesses.
The audit committee’s duties, which are specified in our Audit Committee Charter, include, but are not limited to: ● reviewing and discussing with management and the independent auditor the annual audited financial statements, and recommending to the board whether the audited financial statements should be included in our annual report; ● discussing with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of our financial statements; ● discussing with management major risk assessment and risk management policies; ● monitoring the independence of the independent auditor; ● verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law; ● reviewing and approving all related-party transactions; ● inquiring and discussing with management our compliance with applicable laws and regulations; ● pre-approving all audit services and permitted non-audit services to be performed by our independent auditor, including the fees and terms of the services to be performed; ● appointing or replacing the independent auditor; ● determining the compensation and oversight of the work of the independent auditor (including resolution of disagreements between management and the independent auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work; ● establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding our financial statements or accounting policies; and ● approving reimbursement of expenses incurred by our management team in identifying potential target businesses.
The nominating committee does not distinguish among nominees recommended by shareholders and other persons. 86 Compensation Committee We have established a compensation committee of the board of directors, which consists of Messrs. Zhihong Tan, Yong Li and Ke Chen, each of whom is an independent director under NASDAQ’s listing standards. Mr. Li is the Chairperson of the compensation committee.
The nominating committee does not distinguish among nominees recommended by shareholders and other persons. Compensation Committee We have established a compensation committee of the board of directors, which consists of Messrs. Zhihong Tan, Yong Li and Ke Chen, each of whom is an independent director under NASDAQ’s listing standards. Mr. Li is the Chairperson of the compensation committee.
Li holds a master degree in business from China Europe International Business School in 2006 and a Bachelor of Art in Journalism from Communication University of China in 1991. 83 Family Relationships None of the directors or executive officers have a family relationship as defined in Item 401 of Regulation S-K. B.
Li holds a master degree in business from China Europe International Business School in 2006 and a Bachelor of Art in Journalism from Communication University of China in 1991. Family Relationships None of the directors or executive officers have a family relationship as defined in Item 401 of Regulation S-K. 94 B.
Jia Lu and Zhihong Tan, will expire at the 2026 annual meeting. The term of office of the Class II directors, consisting of Messrs. Yong Li and Bing Zhang, unless re-elected will expire at the 2027 annual meeting, and the term of office of the Class III directors, consisting of Mr. Ke Chen will expire at the 2025 annual meeting.
Jia Lu and Zhihong Tan, will expire at the 2026 annual meeting. The term of office of the Class II directors, consisting of Messrs. Yong Li and Bing Zhang, unless re-elected will expire at the 2027 annual meeting, and the term of office of the Class III directors, consisting of Mr. Ke Chen will expire at the 2028 annual meeting.
Our Class A and Class B Ordinary Shares are not convertible. (1) Unless otherwise indicated, the business address of each of the individuals is 19th Floor, Block B, Xinhua Technology Building, No. 8 Tuofangying Road, Chaoyang District, Beijing, China. (2) Mr. Bing Zhang is our chairman, chief executive officer and interim chief financial officer. Mr.
Our Class A and Class B Ordinary Shares are not convertible. (1) Unless otherwise indicated, the business address of each of the individuals is 19th Floor, Block B, Xinhua Technology Building, No. 8 Tuofangying South Road, Jiuxianqiao, Chaoyang District, Beijing, China 100016. (2) Mr. Bing Zhang is our chairman, chief executive officer and interim chief financial officer.
Zhang is an “at-will” employee. Glory Star Media (Beijing) Co., Ltd entered into an Employment Agreement with our Director and its Senior Vice President, Jia Lu, effective December 20, 2019. Mr. Lu is an “at-will” employee. There were no performance based cash bonuses paid for years ended December 31, 2024 and 2023.
Glory Star Media (Beijing) Co., Ltd entered into an Employment Agreement with our Director and its Senior Vice President, Jia Lu, effective December 20, 2019. Mr. Lu is an “at-will” employee. There were no performance based cash bonuses paid for years ended December 31, 2025 and 2024.
For the year ended December 31, 2024, no awards were granted to our executive officers under the 2019 Plan or 2024 Plan. C.
For the year ended December 31, 2025, no equity awards were granted to our executive officers under the 2019 Plan or 2024 Plan. C.
Equity Compensation Plan Information On February 14, 2020, our board of directors approved our 2019 Equity Incentive Plan (“2019 Plan”), which was approved by our shareholders on December 23, 2019. The 2019 Plan allows for the award of stock and options, up to 373,259 Class A Ordinary Shares.
Equity Compensation Plan Information On February 14, 2020, our board of directors approved our 2019 Equity Incentive Plan (“2019 Plan”), which was approved by our shareholders on December 23, 2019. The 2019 Plan allows for the award of stock and options, up to 7,466 Class A Ordinary Shares.
Ke Chen 46 Independent Director Zhihong Tan 57 Independent Director Yong Li 55 Independent Director The address and telephone number of each director and executive officer of the Company is: 19F, Block B, Xinhua Technology Building, No. 8 Tuofangying South Road, Jiuxianqiao, Chaoyang District, Beijing, China 100016 (Tel: + 86-10-87700500 ).
Ke Chen 47 Independent Director Zhihong Tan 58 Independent Director Yong Li 56 Independent Director The address and telephone number of each director and executive officer of the Company is: 19F, Block B, Xinhua Technology Building, No. 8 Tuofangying South Road, Jiuxianqiao, Chaoyang District, Beijing, China 100016 (Tel: + 86-10-87700500 ).
Share Ownership The following table sets forth information with respect to the beneficial ownership, within the meaning of Rule 13d-3 under the Exchange Act, of our Ordinary Shares as of the date of this annual report. ● each of our directors and executive officers who beneficially own our Ordinary Shares; and ● each person known to us to own beneficially more than 5.0% of our Ordinary Shares. 88 Beneficial ownership includes voting or investment power with respect to the securities.
Share Ownership The following table sets forth information with respect to the beneficial ownership, within the meaning of Rule 13d-3 under the Exchange Act, of our Ordinary Shares as of the date of this annual report. ● each of our directors and executive officers who beneficially own our Ordinary Shares; and ● each person known to us to own beneficially more than 5.0% of our Ordinary Shares.
Name Age Position Bing Zhang 57 Director (Chairman) ,Chief Executive Officer and interim Chief Finance Officer Jia Lu 44 Director and Senior Vice President of Glory Star Media (Beijing) Co., Ltd.
Name Age Position Bing Zhang 58 Director (Chairman), Chief Executive Officer and interim Chief Finance Officer Jia Lu 45 Director and Senior Vice President of Glory Star Media (Beijing) Co., Ltd.
Except as indicated below, and subject to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all Ordinary Shares shown as beneficially owned by them.
Beneficial ownership includes voting or investment power with respect to the securities. Except as indicated below, and subject to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all Ordinary Shares shown as beneficially owned by them.
Involvement in Certain Legal Proceedings To the best of our knowledge, during the past ten years, none of our directors or executive officers were involved in any of the following: (1) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated. 87 Compensation committee Interlocks and Insider Participation None of our officers currently serves, or in the past year has served, as a member of the compensation committee of any entity that has one or more officers serving on our Board of Directors.
Involvement in Certain Legal Proceedings To the best of our knowledge, during the past ten years, none of our directors or executive officers were involved in any of the following: (1) any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; and (4) being found by a court of competent jurisdiction (in a civil action), the Securities and Exchange Commission or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.
The calculations in the table below are based on 11,635,568 Class A Ordinary Shares and 500,000 Class B Ordinary Shares outstanding as of March 5, 2025. Information with respect to beneficial ownership has been furnished by each director, officer, or beneficial owner of 5% or more of our Ordinary Shares.
The calculations in the table below are based on 4,686,248 Class A Ordinary Shares and 500,000 Class B Ordinary Shares outstanding as of March 16, 2026. Information with respect to beneficial ownership has been furnished by each director, officer, or beneficial owner of 5% or more of our Ordinary Shares.
Zhihong Tan, Yong Li and Ke Chen in connection with their appointments as independent directors of the Company. Pursuant to the independent director agreements, each independent director shall be entitled to a fee of $2,000 per month ($24,000 per year).
Compensation of Non-Executive Directors We entered into respective independent director agreements with our independent directors, Messrs. Zhihong Tan, Yong Li and Ke Chen in connection with their appointments as independent directors of the Company. Pursuant to the independent director agreements, each independent director shall be entitled to a fee of $2,000 per month ($24,000 per year).
In addition, we also granted each independent director 2,000 of our ordinary shares pursuant to the terms and conditions of a restricted stock award agreement pursuant to our 2019 Equity Incentive Plan. Each independent director is also entitled to reimbursement for-out of-pocket expenses incurred.
In addition, we also granted each independent director 4 of our Class A Ordinary Shares pursuant to the terms and conditions of a restricted stock award agreement pursuant to our 2019 Equity Incentive Plan. Each independent director is also entitled to reimbursement for-out of-pocket expenses incurred. In 2025, we paid an aggregate of $72,000 in cash to our independent directors.
Subject to phase-in rules and certain limited exceptions, the rules of NASDAQ and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors, and the rules of NASDAQ require that the compensation committee and nominating committee of a listed company be comprised solely of independent directors.
Subject to phase-in rules and certain limited exceptions, the rules of NASDAQ and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors, and the rules of NASDAQ require that the compensation committee and nominating committee of a listed company be comprised solely of independent directors. 96 Audit Committee We have established an audit committee of the board of directors, which consists of Messrs.
Zhihong Tan, Yong Li and Ke Chen each qualify as an “audit committee financial expert,” as defined under rules and regulations of the SEC. Nominating Committee We have established a nominating committee of the board of directors, which consists of Messrs. Zhihong Tan, Yong Li and Ke Chen, each of whom is an independent director under NASDAQ’s listing standards. Mr.
The board of directors has determined that Messrs. Zhihong Tan, Yong Li and Ke Chen each qualify as an “audit committee financial expert,” as defined under rules and regulations of the SEC. Nominating Committee We have established a nominating committee of the board of directors, which consists of Messrs.
Audit Committee We have established an audit committee of the board of directors, which consists of Messrs. Zhihong Tan, Yong Li and Ke Chen, each of whom is an independent director under NASDAQ’s listing standards. Mr. Tan is the Chairperson of the audit committee.
Zhihong Tan, Yong Li and Ke Chen, each of whom is an independent director under NASDAQ’s listing standards. Mr. Tan is the Chairperson of the audit committee.
In 2024, we paid an aggregate of $72,000 in cash to our independent directors and did not grant any restrictive stock units under our 2019 Plan or 2024 Plan to our independent directors. Employment Agreements with Executive Officers We entered into an Employment Agreement with our chief executive officer, Bing Zhang, effective December 20, 2019. Mr.
We did not grant any restrictive stock units or other equity awards under our 2024 Plan to our independent directors in 2025. 95 Employment Agreements with Executive Officers We entered into an Employment Agreement with our chief executive officer, Bing Zhang, effective December 20, 2019. Mr. Zhang is an “at-will” employee.
The table below sets forth a breakdown of the numbers of employees by functions as of December 31, 2024: Department Headcount Percentage of Total Human Resource and General Management Department 6 4.9 % Financial Management Department 8 6.6 % Business Development and Securities Department 1 0.8 % Public and Investor Relations Department 2 1.6 % Information Technology and Research Department 30 24.6 % Integrated Content Marketing Department 25 20.5 % CHEERS Platform and e-Mall Department 50 41.0 % Total 122 100.00 % We have entered into written employment contracts with all of our employees in accordance with PRC Labor Law and Contract Law.
The table below sets forth a breakdown of the numbers of employees by functions as of December 31, 2025: Department Headcount Percentage of Total Human Resource and General Management Department 5 4.3 % Financial Management Department 6 5.2 % Investor Relations and Legal Department 2 1.7 % Research and Development Department 39 33.6 % Content Marketing and Live Streaming Department 22 19.0 % CHEERS Platform and e-Mall Department 42 36.2 % Total 116 100.00 % We have entered into written employment contracts with all of our employees in accordance with PRC Labor Law and Contract Law.
Compensation In 2024, we paid an aggregate of $1,286,076.20 in cash to our executive officers. We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our executive officers and directors.
Compensation In 2025, we paid an aggregate of $90,271.36 in cash to our executive officers. We did not grant any awards under our equity incentive plans to our executive officers in 2025. We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our executive officers and directors.
In addition, a copy of the Code of Ethics will be provided without charge upon request from us. Requests for a copy of the Code of Ethics may be made by writing to the Company at Cheer Holding, Inc., 19F, Block B, Xinhua Technology Building, No. 8 Tuofangying South Road, Jiuxianqiao, Chaoyang District, Beijing, China. D.
Requests for a copy of the Code of Ethics may be made by writing to the Company at Cheer Holding, Inc., 19F, Block B, Xinhua Technology Building, No. 8 Tuofangying South Road, Jiuxianqiao, Chaoyang District, Beijing, China. 99 D. Employees As of December 31, 2025, we had 116 full-time employees.
The compensation committee’s duties, which are specified in our Compensation Committee Charter, include, but are not limited to: ● reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer’s based on such evaluation; ● reviewing and approving the compensation of all of our other executive officers; ● reviewing our executive compensation policies and plans; ● implementing and administering our incentive compensation equity-based remuneration plans; ● assisting management in complying with our proxy statement and annual report disclosure requirements; ● approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our executive officers and employees; ● if required, producing a report on executive compensation to be included in our annual proxy statement; and ● reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.
The compensation committee’s duties, which are specified in our Compensation Committee Charter, include, but are not limited to: ● reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer’s based on such evaluation; ● reviewing and approving the compensation of all of our other executive officers; ● reviewing our executive compensation policies and plans; ● implementing and administering our incentive compensation equity-based remuneration plans; ● assisting management in complying with our proxy statement and annual report disclosure requirements; ● approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our executive officers and employees; ● if required, producing a report on executive compensation to be included in our annual proxy statement; and ● reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors. 98 Special Committee Our Board of Directors received the following non-binding proposals (the “Non-Binding Proposals”): (i) a preliminary non-binding proposal letter, dated November 1, 2025, from Zhongsheng Dingxin Investment Fund Management (Beijing) Co., Ltd., an existing shareholder of the Company, proposing to acquire all of the outstanding Class A Ordinary Shares for US$0.56 in cash per Class A Ordinary Share, and (ii) a preliminary non-binding proposal letter, dated November 4, 2025, from Excel Ally Ventures Limited proposing to acquire all of the outstanding Class A Ordinary Shares for US$0.52 in cash per Class A Ordinary Share.
Code of Ethics We have adopted a Code of Ethics applicable to our directors, officers and employees. We have filed a copy of our Code of Ethics and our Audit Committee Charter, Nominating Committee Charter and Compensation Committee Charter with the SEC and have made it available on our website at http://ir.gsmg.co.
We have filed a copy of our Code of Ethics and our Audit Committee Charter, Nominating Committee Charter and Compensation Committee Charter with the SEC and have made it available on our website at http://ir.gsmg.co. In addition, a copy of the Code of Ethics will be provided without charge upon request from us.
On July 15, 2024, our board of directors approved our 2024 Equity Incentive Plan (“2024 Plan”), which was approved by our shareholders on August 28, 2024. The 2024 Plan allows for the award of stock and options, up to 2,000,000 Class A Ordinary Shares. As of December 31, 2024, no awards have been issued under the 2024 Plan.
As of December 31, 2025, there are no Class A Ordinary Shares available for issuance under the 2019 Plan. On July 15, 2024, our board of directors approved our 2024 Equity Incentive Plan (“2024 Plan”), which was approved by our shareholders on August 28, 2024.
Financial Experts on Audit Committee The audit committee will at all times be composed exclusively of “independent directors” who are “financially literate” as defined under NASDAQ listing standards. NASDAQ listing standards define “financially literate” as being able to read and understand fundamental financial statements, including a company’s balance sheet, income statement and cash flow statement.
Financial Experts on Audit Committee The audit committee will at all times be composed exclusively of “independent directors” who are “financially literate” as defined under NASDAQ listing standards.
In addition, we must certify to NASDAQ that the committee has, and will continue to have, at least one member who has past employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience or background that results in the individual’s financial sophistication. The board of directors has determined that Messrs.
NASDAQ listing standards define “financially literate” as being able to read and understand fundamental financial statements, including a company’s balance sheet, income statement and cash flow statement. 97 In addition, we must certify to NASDAQ that the committee has, and will continue to have, at least one member who has past employment experience in finance or accounting, requisite professional certification in accounting, or other comparable experience or background that results in the individual’s financial sophistication.
Long-term incentive plans No long term incentive awards were granted by us in the last fiscal year. Pension Benefits None of our named executive officers participate in or have account balances in qualified or nonqualified defined benefit plans sponsored by it.
Pension Benefits None of our named executive officers participate in or have account balances in qualified or nonqualified defined benefit plans sponsored by it. Nonqualified Deferred Compensation None of our named executive officers participate in or have account balances in nonqualified defined contribution plans or other deferred compensation plans maintained by it.
Special Committee We have established a special committee of the board of directors, which consists of Messrs. Zhihong Tan and Ke Chen, each of whom is an independent director under NASDAQ’s listing standards. Mr. Chen is the Chairperson of the special committee.
We have established a special committee of the board of directors, which consists of Messrs. Bing Zhang, Zhihong Tan and Yong Li. Mr. Zhang is our chairman and chief executive officer, and Messrs. Tan and Li are each an independent director under NASDAQ’s listing standards, all of whom are disinterested directors with respect to the Non-Binding Proposals. Mr.
Zhang is also the sole shareholder and director of Happy Starlight Limited. (3) Mr. Jia Lu is our director and senior vice president of Glory Star Media (Beijing) Co., Ltd. Mr. Lu is also the sole shareholder and director of Enjoy Starlight Limited. (4) Mr. Himanshu H.
Represents (i) 1,520 Class A Ordinary Shares held by Mr. Zhang in street name, and (ii) 37,906 Class A Ordinary Shares held by Happy Starlight Limited (“HSL”), of which Mr. Zhang is the sole shareholder and director. (3) Mr. Jia Lu is our director and senior vice president of Glory Star Media (Beijing) Co., Ltd.
Chen is the Chairperson of the nominating committee. The nominating committee is responsible for overseeing the selection of persons to be nominated to serve on our board of directors. The nominating committee considers persons identified by its members, management, shareholders, investment bankers and others.
The nominating committee considers persons identified by its members, management, shareholders, investment bankers and others.
Removed
No awards were granted to our executive officers and employees during the fiscal year ended December 31, 2023. Please see “Item 6. Directors, Senior Management And Employees—B. Compensation” for grant of shares to our executive officers. As of December 31, 2024, there are no Class A Ordinary Shares available for issuance under the 2019 Plan.
Added
The 2024 Plan allows for the award of stock and options, up to 40,000 Class A Ordinary Shares. As of December 31, 2025, awards representing 27,000 Class A Ordinary Shares have been issued under the 2024 Plan. Long-term incentive plans No long term incentive awards were granted by us in the last fiscal year.
Removed
Nonqualified Deferred Compensation None of our named executive officers participate in or have account balances in nonqualified defined contribution plans or other deferred compensation plans maintained by it. 84 Compensation of Non-Executive Directors We entered into respective independent director agreements with our independent directors, Messrs.
Added
Zhihong Tan, Yong Li and Ke Chen, each of whom is an independent director under NASDAQ’s listing standards. Mr. Chen is the Chairperson of the nominating committee. The nominating committee is responsible for overseeing the selection of persons to be nominated to serve on our board of directors.
Removed
The purpose of the special committee is to review and consider the terms and conditions of the Merger Agreement, the Plan of Merger, and the transactions contemplated by the Merger Agreement, including the Going Private Transaction. The Going Private Transaction was terminated on April 7, 2023.
Added
Zhang is the Chairperson of the special committee. The purpose of the special committee is to evaluate and consider the Non-Binding Proposals as well as other potential strategic alternatives that the Company may pursue which may be more beneficial for the Company.
Removed
Employees As of December 31, 2024, we had 122 full-time employees.
Added
The Special Committee will have the right to retain advisors, including an independent financial advisor and independent legal counsel, to assist it in its evaluation.
Removed
Class A Ordinary Shares Percentage of Beneficial Ownership of Class A Ordinary Shares Class B Ordinary Shares Percentage of Beneficial Ownership of Class B Ordinary Shares Percentage of Aggregate Voting Power** Name and Address of Beneficial Owner Number % Number % % Directors and Officers Bing Zhang (2) 1,971,287 16.9 % 500,000 100.0 % 84.3 % Jia Lu (3) 655,429 5.6 % - - 1.1 % Ke Chen 200 * - - * Zhihong Tan 200 * - - * Yong Li 200 * - - * All directors and executive officers as a group (five individuals): 2,627,316 22.6 % 500,000 100.0 % 85.4 % Happy Starlight Limited (2) 1,895,287 16.3 % - - 3.1 % Enjoy Starlight Limited (3) 655,412 5.6 % - - 1.1 % Shah Capital Management (4) 1,614,921 13.9 % - - 2.6 % Shah Capital Opportunity Fund LP (4) 1,614,921 13.9 % - - 2.6 % Himanshu H.
Added
In December 2025, both offerors indicated that, due to material adverse changes in our share price and dilution of our share capital, the current circumstances are fundamentally different from those existing at the time of the original proposals. Consequently, the offerors are unable to proceed with the transaction under the previously offered terms.
Removed
Shah (4) 1,614,921 13.9 % - - 2.6 % Zhong Sheng Ding Xin Investment Fund Management (Beijing) Co., Ltd.
Added
The offeror stated that they would re-evaluate the feasibility of any potential transaction based on the Company's subsequent developments, subject to further review and decision by their respective internal investment committees. In March 2026, the Special Committee determined to formally cease all discussions and considerations regarding the Non-Binding Proposals, and Mr. Zhang has notified the offerors accordingly.
Removed
(5) 2,016,129 17.3 % - - 3.3 % * Less than 1% ** For each person and group included in this column, percentage of voting power is calculated by dividing the voting power beneficially owned by such person or group by the voting power of all of our outstanding Class A Ordinary Shares and Class B Ordinary Shares voting together as a single class.
Added
Compensation committee Interlocks and Insider Participation None of our officers currently serves, or in the past year has served, as a member of the compensation committee of any entity that has one or more officers serving on our Board of Directors. Code of Ethics We have adopted a Code of Ethics applicable to our directors, officers and employees.
Removed
Shah is the president and chief investment officer of Shah Capital Management, Inc., which serves as the investment adviser to Shah Capital Opportunity Fund LP, of which Mr. Shah is also its managing member. According to the Form 13G/A jointly filed by Mr.
Added
Represents (i) 1 Class A Ordinary Shares held by Mr. Lu in street name, and (ii) 13,108 Class A Ordinary Shares held by Enjoy Starlight Limited, of which Mr. Lu is the sole shareholder and director. (4) Based on information available on Schedule 13G filed by Mr. Ulrich on January 30, 2026.
Removed
Shah, Shah Capital Opportunity Fund LP and Shah Capital Management (Collectively, “Reporting Persons”) with the SEC on April 21, 2023, the amount of shares the Reporting Person beneficially owned was 1,614,921.00. As such, Mr. Shah has shared voting and dispositive control over such securities and may be deemed the beneficial owner of 1,614,921 shares.
Added
Represents 560,024 Class A Ordinary Shares beneficially held by Mr. Ulrich. The address of the Reporting Persons is Im Hebetal 12 D 07778 Tautenburg, Germany. (5) Mr.
Removed
(5) Zhong Sheng Ding Xin Investment Fund Management (Beijing) Co., Ltd. (“ZSDX”) is a corporation with limited liability organized under the laws of the People’s Republic of China. The principal office for ZSDX is located at 6F Building 4, Wangjing Street, Chaoyang District, Beijing, China 100020.
Added
Bigger is the managing member of Bigger Capital Fund GP, LLC (“Bigger GP”), which is the general partner of Bigger Capital Fund, LP (“Bigger Capital”), and the managing member of District 2 Holdings LLC (“District 2 Holdings”), which is the managing member of District 2 GP LLC (“District 2 GP”), the general partner of District 2 Capital Fund LP (“District 2 CF”).
Removed
According to the Form 13D filed by ZSDX with the SEC on May 19, 2023, the amount of shares ZSDX beneficially owned was 2,016,129. 89 F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable.
Added
Based on information available on Amendment No. 1 to Schedule 13G jointly filed by Mr. Bigger, Bigger Capital, Bigger GP, District 2 CP, District 2 Capital LP, the investment manager of District 2 CF, District 2 GP, and District 2 Holdings (collectively, the “Reporting Persons”) with the SEC on February 11, 2026.
Added
Represents 275,340 Class A Ordinary Shares, consisting of (i) 137,670 Class A Ordinary Shares beneficially owned by Bigger Capital, and (ii) 137,670 Class A Ordinary Shares beneficially owned by District 2 CF.
Added
Does not include 525,000 Class A Ordinary Shares issuable upon exercise of Pre-Funded Warrants, which are subject to a 9.99% beneficial ownership limitation and are beneficially owned by District 2 CF. The address of the Reporting Persons is 11700 West Charleston Blvd., #170-659, Las Vegas, NV, 89135. 101 F.
Added
Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

4 edited+1 added−0 removed8 unchanged
Biggest changeBing Zhang, the Chairman of the Company’s board of directors and Chief Executive Officer. The balance represented interest free borrowings from Mr. Zhang. The borrowings were repayable on demand and did not require of guarantees or pledges from the Company. Loan Guarantee In January 2025, the Company borrowed approximately $0.7 million (equivalent to RMB 5 million) from Huaxia Bank.
Biggest changeThe borrowing was interest free and were repayable on demand and did not require of guarantees or pledges from the Company. 102 Loan Guarantee As of December 31, 2025, the guarantee information for bank borrowings were as below: The loans from Huaxia Bank Co., Ltd.
Organizational Structure.” For a description of certain relationships with related parties, see “Item 4. Information on the Company—A. History and Development of the Company.” Except as otherwise disclosed below or referenced in this annual report, there were no related party transaction in 2023 and 2024.
Organizational Structure.” For a description of certain relationships with related parties, see “Item 4. Information on the Company—A. History and Development of the Company.” Except as otherwise disclosed below or referenced in this annual report, there were no related party transaction in 2024 and 2025.
The bank borrowing was guaranteed by Beijing Zhongguancun Technology Financing Guarantee Co., LTD, and Mr. Bing Zhang, the Company’s Chief Executive Officer and Chairman. 90 Employment Agreements See “Item 6. Directors, Senior Management and Employees—B. Compensation—Employment Agreements.” C. Interests of Experts and Counsel Not applicable.
West Railway Station Branch were guaranteed by Beijing Zhongguancun Technology Financing Guarantee Co., Ltd, and Mr. Bing Zhang, the Chairman of the Company’s board of directors. The loans from China Citic Bank were guaranteed by Horgos and Mr. Bing Zhang. Employment Agreements See “Item 6. Directors, Senior Management and Employees—B. Compensation—Employment Agreements.” C. Interests of Experts and Counsel Not applicable.
The Class B Ordinary Shares issued in connection with the Subscription Agreement are exempt from the registration requirements of the Securities Act, pursuant to Regulation S of the Securities Act. Amounts Due to Chairman As of December 31, 2024, the Company had amount of $1.1 million due to Mr.
The Class B Ordinary Shares issued in connection with the Subscription Agreement are exempt from the registration requirements of the Securities Act, pursuant to Regulation S of the Securities Act. Amounts Due to Chairman For the years ended December 31, 2025 and 2023, the Company borrowed loans of $700 and $1,600 from Mr. Bing Zhang, respectively.
Added
The borrowings were interest free and were repayable on demand and did not require of guarantees or pledges from the Company. For the year ended December 31, 2024, the Company repaid loans of $500 to Mr. Bing Zhang. For the years ended December 31, 2025, the Company also borrowed loans of $950 from Happy Starlight Limited.