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Akso Health Group

Akso Health GroupAHG财报

Nasdaq · 工业 · 其他商业服务

Akso Health Group is a global healthcare enterprise specializing in the R&D, production, and distribution of generic pharmaceuticals, over-the-counter wellness products, and medical devices. It primarily serves markets in China, Southeast Asia, and North America, with core business segments covering drug manufacturing, medical supply chains, and community healthcare services.

What changed in Akso Health Group's 20-F — 2024 vs 2025

Top changes in Akso Health Group's 2025 20-F

604 paragraphs added · 279 removed · 238 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

127 edited+245 added−10 removed520 unchanged
Furthermore, trading in our securities may be prohibited under the Holding Foreign Companies Accountable Act (the “HFCA Act”) if the SEC subsequently determines our audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely, and as a result, U.S. national securities exchanges, such as Nasdaq, may determine to delist our securities.
Furthermore, trading in our securities may be prohibited under the Holding Foreign Companies Accountable Act (the “HFCA Act”) if the SEC subsequently determines our audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely, and as a result, U.S. national securities exchanges, such as Nasdaq, may determine to delist our securities.
Furthermore, trading in our securities may be prohibited under the Holding Foreign Companies Accountable Act (the “HFCA Act”) if the SEC subsequently determines our audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely, and as a result, U.S. national securities exchanges, such as Nasdaq, may determine to delist our securities.
Furthermore, trading in our securities may be prohibited under the Holding Foreign Companies Accountable Act (the “HFCA Act”) if the SEC subsequently determines our audit work is performed by auditors that the PCAOB is unable to inspect or investigate completely, and as a result, U.S. national securities exchanges, such as Nasdaq, may determine to delist our securities.
Furthermore, on December 29, 2022, the Consolidated Appropriations Act, was signed into law by President Biden. The Consolidated Appropriations Act contained, among other things, an identical provision to AHFCAA, which reduce the number of consecutive non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two.
Furthermore, on December 29, 2022, the Consolidated Appropriations Act, was signed into law by President Biden. The Consolidated Appropriations Act contained, among other things, an identical provision to AHFCAA, which reduce the number of consecutive non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two.
On December 15, 2022, the PCAOB Board determined that the PCAOB was able to secure complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong and voted to vacate its previous determinations to the contrary.
On December 15, 2022, the PCAOB Board determined that the PCAOB was able to secure complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong and voted to vacate its previous determinations to the contrary.
As a result, both you and us fact uncertainty about future actions by the PRC government that could significantly affect our business, our listing on Nasdaq, financial condition and results of operations.
As a result, both you and us fact uncertainty about future actions by the PRC government that could significantly affect our business, our listing on Nasdaq, financial condition and results of operations.
The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies.
The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies.
The laws and regulations are sometimes vague and may be subject to future changes, and their official interpretation and enforcement may involve substantial uncertainty.
The laws and regulations are sometimes vague and may be subject to future changes, and their official interpretation and enforcement may involve substantial uncertainty.
The effectiveness and interpretation of newly enacted laws or regulations, including amendments to existing laws and regulations, may be delayed, and our business may be affected if we rely on laws and regulations which are subsequently adopted or interpreted in a manner different from our understanding of these laws and regulations.
The effectiveness and interpretation of newly enacted laws or regulations, including amendments to existing laws and regulations, may be delayed, and our business may be affected if we rely on laws and regulations which are subsequently adopted or interpreted in a manner different from our understanding of these laws and regulations.
Under this policy, annual dividends will be set at an amount equivalent to approximately 15-25% of our anticipated net income after tax in each year commencing from the fiscal year ended March 31, 2019.
Under this policy, annual dividends will be set at an amount equivalent to approximately 15-25% of our anticipated net income after tax in each year commencing from the fiscal year ended March 31, 2019.
On July 19, 2018, our board of directors also approved a special cash dividend of US$0.13 per ordinary share of our company (or US$0.13 per ADS), in addition to an annual dividend pursuant to the newly adopted annual dividend policy of US$0.27 per ordinary share (or US$0.27 per ADS), for a total dividend of US$0.40 per ordinary share (or US$0.40 per ADS).
On July 19, 2018, our board of directors also approved a special cash dividend of US$0.13 per ordinary share of our company (or US$0.13 per ADS), in addition to an annual dividend pursuant to the newly adopted annual dividend policy of US$0.27 per ordinary share (or US$0.27 per ADS), for a total dividend of US$0.40 per ordinary share (or US$0.40 per ADS).
The Trial Measures clarified and emphasized several aspects, which include but are not limited to: (1) comprehensive determination of the “indirect overseas offering and listing by PRC domestic companies” in compliance with the principle of “substance over form” and particularly, an issuer will be required to go through the filing procedures under the Trial Measures if the following criteria are met at the same time: a) 50% or more 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 accounting year is accounted for by PRC domestic companies, and b) the main parts of the issuer’s business activities are conducted in mainland China, or its main places of business are located in mainland China, or the senior managers in charge of its business operation and management are mostly Chinese citizens or domiciled in mainland China; (2) exemptions from immediate filing requirements for issuers that a) have already been listed or registered but not yet listed in foreign securities markets, including U.S. markets, prior to the effective date of the Trial Measures, and b) are not required to re-perform the regulatory procedures with the relevant overseas regulatory authority or the overseas stock exchange, c) whose such overseas securities offering or listing shall be completed before September 30, 2023, provided however that such issuers shall carry out filing procedures as required if they conduct refinancing or are involved in other circumstances that require filing with the CSRC; (3) a negative list of types of issuers banned from listing or offering overseas, such as (a) issuers whose listing or offering overseas have been recognized by the State Council of the PRC as possible threats to national security, (b) issuers whose affiliates have been recently convicted of bribery and corruption, (c) issuers under ongoing criminal investigations, and (d) issuers under major disputes regarding equity ownership; (4) issuers’ compliance with web security, data security, and other national security laws and regulations; (5) issuers’ filing and reporting obligations, such as obligation to file with the CSRC after it submits an application for initial public offering to overseas regulators, and obligation after offering or listing overseas to report to the CSRC material events including change of control or voluntary or forced delisting of the issuer; and (6) the CSRC’s authority to fine both issuers and their shareholders between 1 and 10 million RMB for failure to comply with the Trial Measures, including failure to comply with filing obligations or committing fraud and misrepresentation. 29 Changes in the policies of the PRC government could have a significant impact upon our ability to operate profitably in the PRC.
The Trial Measures clarified and emphasized several aspects, which include but are not limited to: (1) comprehensive determination of the “indirect overseas offering and listing by PRC domestic companies” in compliance with the principle of “substance over form” and particularly, an issuer will be required to go through the filing procedures under the Trial Measures if the following criteria are met at the same time: a) 50% or more 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 accounting year is accounted for by PRC domestic companies, and b) the main parts of the issuer’s business activities are conducted in mainland China, or its main places of business are located in mainland China, or the senior managers in charge of its business operation and management are mostly Chinese citizens or domiciled in mainland China; (2) exemptions from immediate filing requirements for issuers that a) have already been listed or registered but not yet listed in foreign securities markets, including U.S. markets, prior to the effective date of the Trial Measures, and b) are not required to re-perform the regulatory procedures with the relevant overseas regulatory authority or the overseas stock exchange, c) whose such overseas securities offering or listing shall be completed before September 30, 2023, provided however that such issuers shall carry out filing procedures as required if they conduct refinancing or are involved in other circumstances that require filing with the CSRC; (3) a negative list of types of issuers banned from listing or offering overseas, such as (a) issuers whose listing or offering overseas have been recognized by the State Council of the PRC as possible threats to national security, (b) issuers whose affiliates have been recently convicted of bribery and corruption, (c) issuers under ongoing criminal investigations, and (d) issuers under major disputes regarding equity ownership; (4) issuers’ compliance with web security, data security, and other national security laws and regulations; (5) issuers’ filing and reporting obligations, such as obligation to file with the CSRC after it submits an application for initial public offering to overseas regulators, and obligation after offering or listing overseas to report to the CSRC material events including change of control or voluntary or forced delisting of the issuer; and (6) the CSRC’s authority to fine both issuers and their shareholders between 1 and 10 million RMB for failure to comply with the Trial Measures, including failure to comply with filing obligations or committing fraud and misrepresentation. 38 Changes in the policies of the PRC government could have a significant impact upon our ability to operate profitably in the PRC.
(see “To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in PRC or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets” on page 37 of this annual report); ● There are uncertainties regarding the enforcement of laws and rules and regulations in China, which can change quickly with little advance notice, and there is a risk that the Chinese government may intervene or influence our operations at any time, exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers, which could materially and adversely affect our business and hinder our ability to offer or continue our operations, and cause the value of our securities to significantly decline or become worthless.
(see “To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in PRC or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets” on page 46 of this annual report); ● There are uncertainties regarding the enforcement of laws and rules and regulations in China, which can change quickly with little advance notice, and there is a risk that the Chinese government may intervene or influence our operations at any time, exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers, which could materially and adversely affect our business and hinder our ability to offer or continue our operations, and cause the value of our securities to significantly decline or become worthless.
(see “PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our initial public offering and the concurrent private placement to make loans to or make additional capital contributions to our PRC subsidiary, which could materially and adversely affect our liquidity and our ability to fund and expand our business” on page 21 of this annual report); RISKS RELATED TO DOING BUSINESS IN THE PEOPLE’S REPUBLIC OF CHINA ● Although the audit report included in this annual report is prepared by an auditor who are currently inspected by the Public Company Accounting Oversight Board (the “PCAOB”), there is no guarantee that future audit reports will be prepared by auditors inspected by the PCAOB and, as such, in the future investors may be deprived of the benefits of such inspection.
(see “PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our initial public offering and the concurrent private placement to make loans to or make additional capital contributions to our PRC subsidiary, which could materially and adversely affect our liquidity and our ability to fund and expand our business” on page 31 of this annual report); RISKS RELATED TO DOING BUSINESS IN THE PEOPLE’S REPUBLIC OF CHINA ● Although the audit report included in this annual report is prepared by an auditor who are currently inspected by the Public Company Accounting Oversight Board (the “PCAOB”), there is no guarantee that future audit reports will be prepared by auditors inspected by the PCAOB and, as such, in the future investors may be deprived of the benefits of such inspection.
(see “In light of recent events indicating greater oversight by the Cyberspace Administration of China, or CAC, over data security, particularly for companies seeking to list on a foreign exchange, we are subject to a variety of laws and other obligations regarding cybersecurity and data protection, and any failure to comply with applicable laws and obligations could have a material and adverse effect on our business, our listing on NASDAQ, financial condition, and results of operations” on page 27 of this annual report); ● The approval of the China Securities Regulatory Commission, or the CSRC, may be required in connection with an offering under PRC rules, regulations, or policies, and, if required, we cannot predict whether or how soon we will be able to obtain such approval .
(see “In light of recent events indicating greater oversight by the Cyberspace Administration of China, or CAC, over data security, particularly for companies seeking to list on a foreign exchange, we are subject to a variety of laws and other obligations regarding cybersecurity and data protection, and any failure to comply with applicable laws and obligations could have a material and adverse effect on our business, our listing on NASDAQ, financial condition, and results of operations” on page 36 of this annual report); ● The approval of the China Securities Regulatory Commission, or the CSRC, may be required in connection with an offering under PRC rules, regulations, or policies, and, if required, we cannot predict whether or how soon we will be able to obtain such approval.
Moreover, we are exposed to the risk of misconduct, errors and failure to functions by our management, employees and parties that we collaborate with, who may from time to time be subject to litigation and regulatory investigations and proceedings or otherwise face potential liability and penalties in relation to noncompliance with applicable laws and regulations, which could harm our reputation and business. 26 In light of recent events indicating greater oversight by the Cyberspace Administration of China, or CAC, over data security, particularly for companies seeking to list on a foreign exchange, we are subject to a variety of laws and other obligations regarding cybersecurity and data protection, and any failure to comply with applicable laws and obligations could have a material and adverse effect on our business, our listing on NASDAQ, financial condition, and results of operations.
Moreover, we are exposed to the risk of misconduct, errors and failure to functions by our management, employees and parties that we collaborate with, who may from time to time be subject to litigation and regulatory investigations and proceedings or otherwise face potential liability and penalties in relation to noncompliance with applicable laws and regulations, which could harm our reputation and business. 35 In light of recent events indicating greater oversight by the Cyberspace Administration of China, or CAC, over data security, particularly for companies seeking to list on a foreign exchange, we are subject to a variety of laws and other obligations regarding cybersecurity and data protection, and any failure to comply with applicable laws and obligations could have a material and adverse effect on our business, our listing on NASDAQ, financial condition, and results of operations.
(see “There are uncertainties regarding the enforcement of laws and rules and regulations in China, which can change quickly with little advance notice, and there is a risk that the Chinese government may intervene or influence our operations at any time, exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers, which could materially and adversely affect our business and hinder our ability to offer or continue our operations, and cause the value of our securities to significantly decline or become worthless.” on page 37 of this annual report); RISKS RELATED TO OUR ADSs ● The trading price of our ADSs may be volatile, which could result in substantial losses to investors.
(see “There are uncertainties regarding the enforcement of laws and rules and regulations in China, which can change quickly with little advance notice, and there is a risk that the Chinese government may intervene or influence our operations at any time, exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers, which could materially and adversely affect our business and hinder our ability to offer or continue our operations, and cause the value of our securities to significantly decline or become worthless.” on page 46 of this annual report); RISKS RELATED TO OUR ADSs ● The trading price of our ADSs may be volatile, which could result in substantial losses to investors.
If we fail to complete such registrations or obtain such approvals, our ability to use the proceeds we expect to receive from our initial public offering and the concurrent private placement and to capitalize or otherwise fund our PRC operations may be negatively affected, which could materially and adversely affect our liquidity and our ability to fund and expand our business. 22 RISKS RELATED TO DOING BUSINESS IN THE PEOPLE’S REPUBLIC OF CHINA Although the audit report included in this annual report is prepared by an auditor who are currently inspected by the Public Company Accounting Oversight Board (the “PCAOB”), there is no guarantee that future audit reports will be prepared by auditors inspected by the PCAOB and, as such, in the future investors may be deprived of the benefits of such inspection.
If we fail to complete such registrations or obtain such approvals, our ability to use the proceeds we expect to receive from our initial public offering and the concurrent private placement and to capitalize or otherwise fund our PRC operations may be negatively affected, which could materially and adversely affect our liquidity and our ability to fund and expand our business. 31 RISKS RELATED TO DOING BUSINESS IN THE PEOPLE’S REPUBLIC OF CHINA Although the audit report included in this annual report is prepared by an auditor who are currently inspected by the Public Company Accounting Oversight Board (the “PCAOB”), there is no guarantee that future audit reports will be prepared by auditors inspected by the PCAOB and, as such, in the future investors may be deprived of the benefits of such inspection.
However, substantial uncertainty remains regarding the scope and applicability of the M&A Rules to offshore special purpose vehicles. 28 While the application of the M&A Rules remains unclear, we believe, based on the advice of our PRC legal counsel, Hebei Changjun Law Firm that the CSRC approval is not required for the listing and trading our ADSs on the Nasdaq Capital Market because Qingdao Akso Health Management Co., Ltd., or our WFOE was incorporated as a foreign-invested enterprise by means of foreign direct investments rather than by merger with or acquisition of any PRC domestic companies as defined under the M&A Rules.
However, substantial uncertainty remains regarding the scope and applicability of the M&A Rules to offshore special purpose vehicles. 37 While the application of the M&A Rules remains unclear, we believe, based on the advice of our PRC legal counsel, Hebei Changjun Law Firm that the CSRC approval is not required for the listing and trading our ADSs on the Nasdaq Capital Market because Qingdao Akso Health Management Co., Ltd., or our WFOE was incorporated as a foreign-invested enterprise by means of foreign direct investments rather than by merger with or acquisition of any PRC domestic companies as defined under the M&A Rules.
(see “Failure to comply with laws and regulations applicable to our business could subject us to fines and penalties and could also cause us to lose customers or otherwise harm our business” on page 26 of this annual report); ● In light of recent events indicating greater oversight by the Cyberspace Administration of China, or CAC, over data security, particularly for companies seeking to list on a foreign exchange, we are subject to a variety of laws and other obligations regarding cybersecurity and data protection, and any failure to comply with applicable laws and obligations could have a material and adverse effect on our business, our listing on NASDAQ, financial condition, and results of operations.
(see “Failure to comply with laws and regulations applicable to our business could subject us to fines and penalties and could also cause us to lose customers or otherwise harm our business” on page 35 of this annual report); ● In light of recent events indicating greater oversight by the Cyberspace Administration of China, or CAC, over data security, particularly for companies seeking to list on a foreign exchange, we are subject to a variety of laws and other obligations regarding cybersecurity and data protection, and any failure to comply with applicable laws and obligations could have a material and adverse effect on our business, our listing on NASDAQ, financial condition, and results of operations.
(see “Our business, financial performance and results of operations could be adversely affected by deterioration of the relation between China and the United States” on page 21 of this annual report); 9 RISKS RELATED TO OUR CORPORATE STRUCTURE ● PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our initial public offering and the concurrent private placement to make loans to or make additional capital contributions to our PRC subsidiary, which could materially and adversely affect our liquidity and our ability to fund and expand our business.
(see “Our business, financial performance and results of operations could be adversely affected by deterioration of the relation between China and the United States” on page 30 of this annual report); 9 RISKS RELATED TO OUR CORPORATE STRUCTURE ● PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of our initial public offering and the concurrent private placement to make loans to or make additional capital contributions to our PRC subsidiary, which could materially and adversely affect our liquidity and our ability to fund and expand our business.
(see “Enhanced scrutiny over acquisition transactions by the PRC tax authorities may have a negative impact on potential acquisitions we may pursue in the future” on page 36 of this annual report); 12 ● Any actions by the Chinese government, including any decision to intervene or influence the operations of the operating entities or to exert control over any offering of securities conducted overseas and/or foreign investment in China-based issuers, may cause us to make material changes to the operations of the PRC operating entities, may limit or completely hinder our ability to offer or continue to offer securities to investors, and may cause the value of such securities to significantly decline or be worthless.
(see “Enhanced scrutiny over acquisition transactions by the PRC tax authorities may have a negative impact on potential acquisitions we may pursue in the future” on page 45 of this annual report); 12 ● Any actions by the Chinese government, including any decision to intervene or influence the operations of the operating entities or to exert control over any offering of securities conducted overseas and/or foreign investment in China-based issuers, may cause us to make material changes to the operations of the PRC operating entities, may limit or completely hinder our ability to offer or continue to offer securities to investors, and may cause the value of such securities to significantly decline or be worthless.
These developments could add uncertainties to our business operations, share price and reputation.” 5 Cash and Other Assets Transfers within our Organization The Company can transfer cash to its subsidiaries through capital contributions and/or intercompany loans, and the Company’s subsidiaries can transfer cash to the Company through dividends or other distributions and/or intercompany loans.
These developments could add uncertainties to our business operations, share price and reputation.” Cash and Other Assets Transfers within our Organization The Company can transfer cash to its subsidiaries through capital contributions and/or intercompany loans, and the Company’s subsidiaries can transfer cash to the Company through dividends or other distributions and/or intercompany loans.
(see “Any actions by the Chinese government, including any decision to intervene or influence the operations of the operating entities or to exert control over any offering of securities conducted overseas and/or foreign investment in China-based issuers, may cause us to make material changes to the operations of the PRC operating entities, may limit or completely hinder our ability to offer or continue to offer securities to investors, and may cause the value of such securities to significantly decline or be worthless” on page 36 of this annual report); ● The PRC government exerts substantial influence over the manner in which we and our PRC subsidiaries must conduct our business activities.
(see “Any actions by the Chinese government, including any decision to intervene or influence the operations of the operating entities or to exert control over any offering of securities conducted overseas and/or foreign investment in China-based issuers, may cause us to make material changes to the operations of the PRC operating entities, may limit or completely hinder our ability to offer or continue to offer securities to investors, and may cause the value of such securities to significantly decline or be worthless” on page 45 of this annual report); ● The PRC government exerts substantial influence over the manner in which we and our PRC subsidiaries must conduct our business activities.
We are currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if we or our PRC subsidiaries are required to obtain approval in the future and are denied permission from Chinese authorities to list on U.S. exchanges, we will not be able to continue listing on U.S. exchanges, which would materially affect the interest of the investors” on page 37 of this annual report); ● To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in PRC or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets.
We are currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if we or our PRC subsidiaries are required to obtain approval in the future and are denied permission from Chinese authorities to list on U.S. exchanges, we will not be able to continue listing on U.S. exchanges, which would materially affect the interest of the investors” on page 45 of this annual report); ● To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in PRC or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets.
Complying with the requirements of the above-mentioned regulations and other relevant rules to complete such transactions could be time-consuming, and any required approval processes, including obtaining approval from the MOC or its local counterparts may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or maintain our market share. 33 PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiary’s ability to increase its registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC law.
Complying with the requirements of the above-mentioned regulations and other relevant rules to complete such transactions could be time-consuming, and any required approval processes, including obtaining approval from the MOC or its local counterparts may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or maintain our market share. 42 PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiary’s ability to increase its registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC law.
(see “The M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China” on page 33 of this annual report); ● PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiary’s ability to increase its registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC law.
(see “The M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China” on page 42 of this annual report); ● PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiary’s ability to increase its registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC law.
(see “Substantial uncertainties exist with respect to the interpretation and implementation of the newly enacted PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations” on page 31 of this annual report); 11 ● We may be adversely affected by the complexity, uncertainties and changes in PRC regulation of Internet-related businesses and companies, and any lack of requisite approvals, licenses or permits applicable to our business may have a material adverse effect on our business and results of operations.
(see “Substantial uncertainties exist with respect to the interpretation and implementation of the newly enacted PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations” on page 40 of this annual report); 11 ● We may be adversely affected by the complexity, uncertainties and changes in PRC regulation of Internet-related businesses and companies, and any lack of requisite approvals, licenses or permits applicable to our business may have a material adverse effect on our business and results of operations.
(see “PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiary’s ability to increase its registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC law” on page 34 of this annual report); ● Any failure to comply with PRC regulations regarding the registration requirements for employee stock incentive plans may subject the PRC plan participants or us to fines and other legal or administrative sanctions.
(see “PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiary’s ability to increase its registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC law” on page 43 of this annual report); ● Any failure to comply with PRC regulations regarding the registration requirements for employee stock incentive plans may subject the PRC plan participants or us to fines and other legal or administrative sanctions.
Therefore, cybersecurity review could materially and adversely affect our business, financial condition, and results of operations. 27 In addition, the PRC Data Security Law, which was promulgated by the Standing Committee of the National People’s Congress on June 10, 2021 and took effect on September 1, 2021, requires data collection to be conducted in a legitimate and proper manner, and stipulates that, for the purpose of data protection, data processing activities must be conducted based on data classification and hierarchical protection system for data security.
Therefore, cybersecurity review could materially and adversely affect our business, financial condition, and results of operations. 36 In addition, the PRC Data Security Law, which was promulgated by the Standing Committee of the National People’s Congress on June 10, 2021 and took effect on September 1, 2021, requires data collection to be conducted in a legitimate and proper manner, and stipulates that, for the purpose of data protection, data processing activities must be conducted based on data classification and hierarchical protection system for data security.
(see “The amended and restated memorandum and articles of association that we expect to adopt contain anti-takeover provisions that could have a material adverse effect on the rights of holders of our ordinary shares and ADSs” on page 41 of this annual report); ● You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law.
(see “The amended and restated memorandum and articles of association that we expect to adopt contain anti-takeover provisions that could have a material adverse effect on the rights of holders of our ordinary shares and ADSs” on page 50 of this annual report); ● You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law.
(see “The depositary for our ADSs will give us a discretionary proxy to vote the ordinary shares represented by your ADSs if you do not give proper or timely voting instructions to the depositary, except in limited circumstances, which could adversely affect your interests” on page 43 of this annual report); ● You may not receive dividends or other distributions on our ordinary shares and you may not receive any value for them if it is illegal or impracticable to make them available to you.
(see “The depositary for our ADSs will give us a discretionary proxy to vote the ordinary shares represented by your ADSs if you do not give proper or timely voting instructions to the depositary, except in limited circumstances, which could adversely affect your interests” on page 52 of this annual report); ● You may not receive dividends or other distributions on our ordinary shares and you may not receive any value for them if it is illegal or impracticable to make them available to you.
The market price of our ADSs could be adversely affected as a result of anticipated negative impacts of these executive or legislative actions upon, as well as negative investor sentiment towards, companies with significant operations in China that are listed in the United States, regardless of whether these executive or legislative actions are implemented and regardless of our actual operating performance. 24 The recent joint statement by the SEC, proposed rule changes submitted by Nasdaq, and an act passed by the U.S.
The market price of our ADSs could be adversely affected as a result of anticipated negative impacts of these executive or legislative actions upon, as well as negative investor sentiment towards, companies with significant operations in China that are listed in the United States, regardless of whether these executive or legislative actions are implemented and regardless of our actual operating performance. 33 The recent joint statement by the SEC, proposed rule changes submitted by Nasdaq, and an act passed by the U.S.
(see “Any failure to comply with PRC regulations regarding the registration requirements for employee stock incentive plans may subject the PRC plan participants or us to fines and other legal or administrative sanctions” on page 34 of this annual report); ● If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.
(see “Any failure to comply with PRC regulations regarding the registration requirements for employee stock incentive plans may subject the PRC plan participants or us to fines and other legal or administrative sanctions” on page 43 of this annual report); ● If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.
(see “We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to United States domestic public companies” on page 42 of this annual report); ● The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise any right to vote the ordinary shares which are represented by your ADSs.
(see “We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to United States domestic public companies” on page 51 of this annual report); ● The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise any right to vote the ordinary shares which are represented by your ADSs.
(see “The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise any right to vote the ordinary shares which are represented by your ADSs” on page 43 of this annual report); ● The depositary for our ADSs will give us a discretionary proxy to vote the ordinary shares represented by your ADSs if you do not give proper or timely voting instructions to the depositary, except in limited circumstances, which could adversely affect your interests.
(see “The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise any right to vote the ordinary shares which are represented by your ADSs” on page 52 of this annual report); ● The depositary for our ADSs will give us a discretionary proxy to vote the ordinary shares represented by your ADSs if you do not give proper or timely voting instructions to the depositary, except in limited circumstances, which could adversely affect your interests.
Failure to take timely and appropriate measures to cope with any of these or similar regulatory compliance challenges could materially and adversely affect our current corporate structure, corporate governance and business operations. 31 We may be adversely affected by the complexity, uncertainties and changes in PRC regulation of Internet-related businesses and companies, and any lack of requisite approvals, licenses or permits applicable to our business may have a material adverse effect on our business and results of operations.
Failure to take timely and appropriate measures to cope with any of these or similar regulatory compliance challenges could materially and adversely affect our current corporate structure, corporate governance and business operations. 40 We may be adversely affected by the complexity, uncertainties and changes in PRC regulation of Internet-related businesses and companies, and any lack of requisite approvals, licenses or permits applicable to our business may have a material adverse effect on our business and results of operations.
(see “If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the market price for our ADSs and trading volume could decline” on page 39 of this annual report); 13 ● We cannot assure you that our existing dividend policy will not change in the future or the amount the dividends that you may receive, and as such, you must rely on price appreciation of our ADSs for return on your investment.
(see “If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the market price for our ADSs and trading volume could decline” on page 48 of this annual report); 13 ● We cannot assure you that our existing dividend policy will not change in the future or the amount the dividends that you may receive, and as such, you must rely on price appreciation of our ADSs for return on your investment.
Risk Factors — Risks Relating to Doing Business in the People’s Republic of China — To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in PRC or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets.” 7 On July 19, 2018, our board of directors approved an annual dividend policy.
Risk Factors - Risks Relating to Doing Business in the People’s Republic of China - To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in PRC or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets.” 6 On July 19, 2018, our board of directors approved an annual dividend policy.
As a result of the above, to the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in mainland China or Hong Kong, such funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the competent government to the transfer of cash or assets. 37 RISKS RELATED TO OUR ADSs The trading price of our ADSs may be volatile, which could result in substantial losses to investors.
As a result of the above, to the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in mainland China or Hong Kong, such funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the competent government to the transfer of cash or assets. 46 RISKS RELATED TO OUR ADSs The trading price of our ADSs may be volatile, which could result in substantial losses to investors.
(see “Changes in China’s macroeconomic, socio-political conditions or government policies could have a material adverse effect on our business and results of operations” on page 31 of this annual report); ● Substantial uncertainties exist with respect to the interpretation and implementation of the newly enacted PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations.
(see “Changes in China’s macroeconomic, socio-political conditions or government policies could have a material adverse effect on our business and results of operations” on page 40 of this annual report); ● Substantial uncertainties exist with respect to the interpretation and implementation of the newly enacted PRC Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and business operations.
(see “If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders” on page 35 of this annual report); ● We may not be able to obtain certain benefits under relevant tax treaty on dividends paid by our PRC subsidiary to us through our Hong Kong subsidiary.
(see “If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders” on page 44 of this annual report); ● We may not be able to obtain certain benefits under relevant tax treaty on dividends paid by our PRC subsidiary to us through our Hong Kong subsidiary.
If we fail to improve our existing services or introduce new ones in a timely or cost-effective manner, our ability to attract and retain clients may be impaired, and our results of operations and prospects may be adversely affected. 17 Our development of new cancer therapy and radiation oncology centers could result in fluctuations in our short-term financial performance, and newly opened cancer therapy and radiation oncology centers and clinics may not achieve timely profitability, or at all.
If we fail to improve our existing services or introduce new ones in a timely or cost-effective manner, our ability to attract and retain clients may be impaired, and our results of operations and prospects may be adversely affected. 27 Our development of new cancer therapy and radiation oncology centers could result in fluctuations in our short-term financial performance, and newly opened cancer therapy and radiation oncology centers and clinics may not achieve timely profitability, or at all.
If we or our future partners fail to comply with such applicable laws and regulations, we could be required to make significant changes to our business or suffer fines or penalties, including the potential loss of our business licenses, the suspension from use of our medical equipment, and the suspension or cessation of operations at cancer therapy and radiation oncology centers in our network. 18 We are reliant on our core senior management team.
If we or our future partners fail to comply with such applicable laws and regulations, we could be required to make significant changes to our business or suffer fines or penalties, including the potential loss of our business licenses, the suspension from use of our medical equipment, and the suspension or cessation of operations at cancer therapy and radiation oncology centers in our network. 28 We are reliant on our core senior management team.
(see “We may incur liability or become subject to administrative penalties for counterfeit or unauthorized merchandise displayed on our platform, or for merchandise displayed on our platform that infringe on third-party intellectual property rights, or for other misconduct” on page 17 of this annual report); ● We plan to establish and operate cancer therapy and radiation oncology centers that will be majority-owned by us and are subject to significant risks.
(see “We may incur liability or become subject to administrative penalties for counterfeit or unauthorized merchandise displayed on our platform, or for merchandise displayed on our platform that infringe on third-party intellectual property rights, or for other misconduct” on page 26 of this annual report); ● We plan to establish and operate cancer therapy and radiation oncology centers that will be majority-owned by us and are subject to significant risks.
(see “Because our business is dependent upon government policies that encourage a market-based economy, change in the political or economic climate in the PRC may impair our ability to operate profitably, if at all” on page 30 of this annual report); ● PRC laws and regulations governing our current business operations are sometimes vague and uncertain and any changes in such laws and regulations may impair our ability to operate profitable.
(see “Because our business is dependent upon government policies that encourage a market-based economy, change in the political or economic climate in the PRC may impair our ability to operate profitably, if at all” on page 39 of this annual report); ● PRC laws and regulations governing our current business operations are sometimes vague and uncertain and any changes in such laws and regulations may impair our ability to operate profitable.
(see “Failure to make adequate contributions to various employee benefit plans as required by PRC regulations may subject us to penalties” on page 33 of this annual report); ● The M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China.
(see “Failure to make adequate contributions to various employee benefit plans as required by PRC regulations may subject us to penalties” on page 42 of this annual report); ● The M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China.
With the development of the foreign exchange market and progress towards interest rate liberalization and RMB internationalization, the PRC government may in the future announce further changes to the exchange rate system and there is no guarantee that the RMB will not appreciate or depreciate significantly in value against the U.S. dollar in the future. 32 Very limited hedging options are available in China to reduce our exposure to exchange rate fluctuations.
With the development of the foreign exchange market and progress towards interest rate liberalization and RMB internationalization, the PRC government may in the future announce further changes to the exchange rate system and there is no guarantee that the RMB will not appreciate or depreciate significantly in value against the U.S. dollar in the future. 41 Very limited hedging options are available in China to reduce our exposure to exchange rate fluctuations.
(see “We plan to establish and operate cancer therapy and radiation oncology centers that will be majority-owned by us and are subject to significant risks” on page 17 of this annual report); ● We may encounter difficulties in successfully introducing new services in a timely and cost-effective manner, which could materially and adversely affect our business and operations.
(see “We plan to establish and operate cancer therapy and radiation oncology centers that will be majority-owned by us and are subject to significant risks” on page 27 of this annual report); ● We may encounter difficulties in successfully introducing new services in a timely and cost-effective manner, which could materially and adversely affect our business and operations.
(see “We may be adversely affected by the complexity, uncertainties and changes in PRC regulation of Internet-related businesses and companies, and any lack of requisite approvals, licenses or permits applicable to our business may have a material adverse effect on our business and results of operations” on page 32 of this annual report); ● Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment.
(see “We may be adversely affected by the complexity, uncertainties and changes in PRC regulation of Internet-related businesses and companies, and any lack of requisite approvals, licenses or permits applicable to our business may have a material adverse effect on our business and results of operations” on page 41 of this annual report); ● Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment.
(see “If our social e-commerce platform is unable to provide good customer experience, our business and reputation may be materially and adversely affected” on page 16 of this annual report); ● We may incur liability or become subject to administrative penalties for counterfeit or unauthorized merchandise displayed on our platform, or for merchandise displayed on our platform that infringe on third-party intellectual property rights, or for other misconduct.
(see “If our social e-commerce platform is unable to provide good customer experience, our business and reputation may be materially and adversely affected” on page 25 of this annual report); ● We may incur liability or become subject to administrative penalties for counterfeit or unauthorized merchandise displayed on our platform, or for merchandise displayed on our platform that infringe on third-party intellectual property rights, or for other misconduct.
Any declaration and payment, as well as the amount, of dividends will be subject to our constitutional documents and applicable Chinese and U.S. state and federal laws and regulations, including the approval from the shareholders of each subsidiary which intends to declare such dividends, if applicable. 39 Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs to decline.
Any declaration and payment, as well as the amount, of dividends will be subject to our constitutional documents and applicable Chinese and U.S. state and federal laws and regulations, including the approval from the shareholders of each subsidiary which intends to declare such dividends, if applicable. 48 Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs to decline.
The Consolidated Appropriations Act contained, among other things, an identical provision to AHFCAA, which reduce the number of consecutive non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two” on page 23 of this annual report); ● The recent joint statement by the SEC, proposed rule changes submitted by Nasdaq, and an act passed by the U.S.
The Consolidated Appropriations Act contained, among other things, an identical provision to AHFCAA, which reduce the number of consecutive non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two” on page 32 of this annual report); ● The recent joint statement by the SEC, proposed rule changes submitted by Nasdaq, and an act passed by the U.S.
(see “We cannot assure you that our existing dividend policy will not change in the future or the amount the dividends that you may receive, and as such, you must rely on price appreciation of our ADSs for return on your investment” on page 39 of this annual report); ● Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs to decline.
(see “We cannot assure you that our existing dividend policy will not change in the future or the amount the dividends that you may receive, and as such, you must rely on price appreciation of our ADSs for return on your investment” on page 48 of this annual report); ● Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs to decline.
Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations. 44
Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations. 53
If one or more key executives were unable or unwilling to continue in their present positions, our business and results of operations may be adversely affected” on page 19 of this annual report); ● We compete for skilled and quality employees, and failure to attract and retain them may adversely affect our business and prevent us from achieving our intended level of growth.
If one or more key executives were unable or unwilling to continue in their present positions, our business and results of operations may be adversely affected” on page 29 of this annual report); ● We compete for skilled and quality employees, and failure to attract and retain them may adversely affect our business and prevent us from achieving our intended level of growth.
House of Representatives, all call for additional and more stringent criteria to be applied to emerging market companies. These developments could add uncertainties to our business operations, share price and reputation” on page 25 of this annual report); ● There may be changes in the regulations of PRC government bodies and agencies relating to VAT collection procedure and ACTCS business.
House of Representatives, all call for additional and more stringent criteria to be applied to emerging market companies. These developments could add uncertainties to our business operations, share price and reputation” on page 34 of this annual report); ● There may be changes in the regulations of PRC government bodies and agencies relating to VAT collection procedure and ACTCS business.
(see “We may not be able to obtain certain benefits under relevant tax treaty on dividends paid by our PRC subsidiary to us through our Hong Kong subsidiary” on page 35 of this annual report); ● Enhanced scrutiny over acquisition transactions by the PRC tax authorities may have a negative impact on potential acquisitions we may pursue in the future.
(see “We may not be able to obtain certain benefits under relevant tax treaty on dividends paid by our PRC subsidiary to us through our Hong Kong subsidiary” on page 44 of this annual report); ● Enhanced scrutiny over acquisition transactions by the PRC tax authorities may have a negative impact on potential acquisitions we may pursue in the future.
For more information, see “Item 10. Additional Information—E. Taxation—U.S. Federal Income Tax Considerations—PFIC Rules.” 40 The amended and restated memorandum and articles of association that we expect to adopt contain anti-takeover provisions that could have a material adverse effect on the rights of holders of our ordinary shares and ADSs.
For more information, see “Item 10. Additional Information-E. Taxation-U.S. Federal Income Tax Considerations-PFIC Rules.” 49 The amended and restated memorandum and articles of association that we expect to adopt contain anti-takeover provisions that could have a material adverse effect on the rights of holders of our ordinary shares and ADSs.
(see “There may be changes in the regulations of PRC government bodies and agencies relating to VAT collection procedure and ACTCS business” on page 25 of this annual report); 10 ● Failure to comply with laws and regulations applicable to our business could subject us to fines and penalties and could also cause us to lose customers or otherwise harm our business.
(see “There may be changes in the regulations of PRC government bodies and agencies relating to VAT collection procedure and ACTCS business” on page 34 of this annual report); 10 ● Failure to comply with laws and regulations applicable to our business could subject us to fines and penalties and could also cause us to lose customers or otherwise harm our business.
(see “Certain judgments obtained against us by our shareholders may not be enforceable” on page 42 of this annual report); ● We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to United States domestic public companies.
(see “Certain judgments obtained against us by our shareholders may not be enforceable” on page 51 of this annual report); ● We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to United States domestic public companies.
As a result, you may not be afforded the same protections or information, which would be made available to you, were you investing in a U.S. domestic issuer. 42 The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise any right to vote the ordinary shares which are represented by your ADSs.
As a result, you may not be afforded the same protections or information, which would be made available to you, were you investing in a U.S. domestic issuer. 51 The voting rights of holders of ADSs are limited by the terms of the deposit agreement, and you may not be able to exercise any right to vote the ordinary shares which are represented by your ADSs.
As a result, both you and us fact uncertainty about future actions by the PRC government that could significantly affect our business, our listing on Nasdaq, financial condition and results of operations” on page 28 of this annual report); ● Changes in the policies of the PRC government could have a significant impact upon our ability to operate profitably in the PRC.
As a result, both you and us fact uncertainty about future actions by the PRC government that could significantly affect our business, our listing on Nasdaq, financial condition and results of operations” on page 37 of this annual report); ● Changes in the policies of the PRC government could have a significant impact upon our ability to operate profitably in the PRC.
(see “PRC laws and regulations governing our current business operations are sometimes vague and uncertain and any changes in such laws and regulations may impair our ability to operate profitable” on page 30 of this annual report); ● Changes in China’s macroeconomic, socio-political conditions or government policies could have a material adverse effect on our business and results of operations.
(see “PRC laws and regulations governing our current business operations are sometimes vague and uncertain and any changes in such laws and regulations may impair our ability to operate profitable” on page 39 of this annual report); ● Changes in China’s macroeconomic, socio-political conditions or government policies could have a material adverse effect on our business and results of operations.
(see “Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs to decline” on page 40 of this annual report); ● We may be classified as a passive foreign investment company for U.S. federal income tax purposes, which could result in adverse U.S. federal income tax consequences to U.S.
(see “Substantial future sales or perceived potential sales of our ADSs in the public market could cause the price of our ADSs to decline” on page 49 of this annual report); ● We may be classified as a passive foreign investment company for U.S. federal income tax purposes, which could result in adverse U.S. federal income tax consequences to U.S.
(see “We conduct our business in a heavily regulated industry” on page 18 of this annual report); ● We are reliant on our core senior management team. If one or more key executives were unable or unwilling to continue in their present positions, our business and results of operations may be adversely affected.
(see “We conduct our business in a heavily regulated industry” on page 28 of this annual report); ● We are reliant on our core senior management team. If one or more key executives were unable or unwilling to continue in their present positions, our business and results of operations may be adversely affected.
(see “Changes in the policies of the PRC government could have a significant impact upon our ability to operate profitably in the PRC” on page 30 of this annual report); ● Because our business is dependent upon government policies that encourage a market-based economy, change in the political or economic climate in the PRC may impair our ability to operate profitably, if at all.
(see “Changes in the policies of the PRC government could have a significant impact upon our ability to operate profitably in the PRC” on page 39 of this annual report); ● Because our business is dependent upon government policies that encourage a market-based economy, change in the political or economic climate in the PRC may impair our ability to operate profitably, if at all.
(see “You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law” on page 41 of this annual report); ● Certain judgments obtained against us by our shareholders may not be enforceable.
(see “You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law” on page 50 of this annual report); ● Certain judgments obtained against us by our shareholders may not be enforceable.
Under the HFCA Act, our securities may be prohibited from trading on Nasdaq or other U.S. stock exchanges if our auditor is not inspected by the PCAOB for three consecutive years, and this ultimately could result in our Ordinary Shares being delisted. 23 Furthermore, on June 22, 2021, the U.S.
Under the HFCA Act, our securities may be prohibited from trading on Nasdaq or other U.S. stock exchanges if our auditor is not inspected by the PCAOB for three consecutive years, and this ultimately could result in our Ordinary Shares being delisted. 32 Furthermore, on June 22, 2021, the U.S.
(see “You may not receive dividends or other distributions on our ordinary shares and you may not receive any value for them if it is illegal or impracticable to make them available to you” on page 43 of this annual report); ● You may experience dilution of your holdings due to inability to participate in rights offerings.
(see “You may not receive dividends or other distributions on our ordinary shares and you may not receive any value for them if it is illegal or impracticable to make them available to you” on page 52 of this annual report); ● You may experience dilution of your holdings due to inability to participate in rights offerings.
Any uninsured business disruptions may result in our incurring substantial costs and the diversion of resources, which could have an adverse effect on our results of operations and financial condition. 19 If we do not find available sources of liquidity for capital and financing needs, our business and operations may be materially and adversely affected.
Any uninsured business disruptions may result in our incurring substantial costs and the diversion of resources, which could have an adverse effect on our results of operations and financial condition. 29 If we do not find available sources of liquidity for capital and financing needs, our business and operations may be materially and adversely affected.
We cannot assure you that our practices would not be deemed to violate any PRC laws, regulations or policies either now or in the future. 25 Moreover, developments in the ACTCS service industry may lead to changes in PRC laws, regulations and policies or in the interpretation and application of existing laws, regulations and policies, which may limit or restrict the ACTCS hardware and services we offer.
We cannot assure you that our practices would not be deemed to violate any PRC laws, regulations or policies either now or in the future. 34 Moreover, developments in the ACTCS service industry may lead to changes in PRC laws, regulations and policies or in the interpretation and application of existing laws, regulations and policies, which may limit or restrict the ACTCS hardware and services we offer.
As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by our management, members of the board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States. 41 Certain judgments obtained against us by our shareholders may not be enforceable.
As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by our management, members of the board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States. 50 Certain judgments obtained against us by our shareholders may not be enforceable.
(see “We compete for skilled and quality employees, and failure to attract and retain them may adversely affect our business and prevent us from achieving our intended level of growth” on page 19 of this annual report); ● If labor costs in the PRC increase substantially, our business and costs of operations may be adversely affected.
(see “We compete for skilled and quality employees, and failure to attract and retain them may adversely affect our business and prevent us from achieving our intended level of growth” on page 29 of this annual report); ● If labor costs in the PRC increase substantially, our business and costs of operations may be adversely affected.
(see “Governmental control of currency conversion may limit our ability to utilize our net revenues effectively and affect the value of your investment” on page 33 of this annual report); ● Failure to make adequate contributions to various employee benefit plans as required by PRC regulations may subject us to penalties.
(see “Governmental control of currency conversion may limit our ability to utilize our net revenues effectively and affect the value of your investment” on page 42 of this annual report); ● Failure to make adequate contributions to various employee benefit plans as required by PRC regulations may subject us to penalties.
(see “Our development of new cancer therapy and radiation oncology centers could result in fluctuations in our short-term financial performance, and newly opened cancer therapy and radiation oncology centers and clinics may not achieve timely profitability, or at all” on page 18 of this annual report); ● Our growth plan includes the construction of cancer therapy and radiation oncology centers.
(see “Our development of new cancer therapy and radiation oncology centers could result in fluctuations in our short-term financial performance, and newly opened cancer therapy and radiation oncology centers and clinics may not achieve timely profitability, or at all” on page 28 of this annual report); ● Our growth plan includes the construction of cancer therapy and radiation oncology centers.
(see “If we do not find available sources of liquidity for capital and financing needs, our business and operations may be materially and adversely affected” on page 20 of this annual report); ● Our business, financial performance and results of operations could be adversely affected by deterioration of the relation between China and the United States.
(see “If we do not find available sources of liquidity for capital and financing needs, our business and operations may be materially and adversely affected” on page 30 of this annual report); ● Our business, financial performance and results of operations could be adversely affected by deterioration of the relation between China and the United States.
Business Overview-Regulation-Regulations Relating to Foreign Exchange - Regulations on Stock Incentive Plans.” 34 If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.
Business Overview-Regulation-Regulations Relating to Foreign Exchange - Regulations on Stock Incentive Plans.” 43 If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ADS holders.
(see “Techniques employed by short sellers may drive down the market price of our ADSs” on page 39 of this annual report); ● If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the market price for our ADSs and trading volume could decline.
(see “Techniques employed by short sellers may drive down the market price of our ADSs” on page 48 of this annual report); ● If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the market price for our ADSs and trading volume could decline.
Pursuant to the Overseas Listing Trial Measures, domestic companies that seek to offer or list securities overseas, whether directly or indirectly, should fulfil the filing procedures and submit relevant information to the CSRC. 36 Although the detailed implementations are still unclear, the supervision of overseas listing of Chinese stocks may continue to tighten.
Pursuant to the Overseas Listing Trial Measures, domestic companies that seek to offer or list securities overseas, whether directly or indirectly, should fulfil the filing procedures and submit relevant information to the CSRC. 45 Although the detailed implementations are still unclear, the supervision of overseas listing of Chinese stocks may continue to tighten.
(see “Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment” on page 32 of this annual report); ● Governmental control of currency conversion may limit our ability to utilize our net revenues effectively and affect the value of your investment.
(see “Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment” on page 41 of this annual report); ● Governmental control of currency conversion may limit our ability to utilize our net revenues effectively and affect the value of your investment.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

46 edited+66 added−4 removed315 unchanged
On March 5, 2024, Tianjin Akso Enterprise Management Co., Ltd., our PRC subsidiary, entered into certain securities purchase agreements with four shareholders of Tianjin Wangyi Cloud Co., Ltd. and acquired 50% of the equity interests of Tianjin Wangyi Cloud Co., Ltd. The transaction closed on April 15, 2024.
On March 5, 2024, Tianjin Akso Enterprise Management Co., Ltd., our PRC subsidiary, entered into certain securities purchase agreements with four shareholders of Tianjin Wangyi Cloud Co., Ltd. and acquired 50% of the equity interests of Tianjin Wangyi Cloud Co., Ltd. The transaction closed on April 15, 2024.
Tianjin Wangyi Cloud Co., Ltd. engages in the business of providing online hospital services including health consultancy services and online sales of medicines and health products through its two wholly owned PRC subsidiaries, Tian Jin Deyihui Online Hospital Co., Ltd. and Tian Jin Deyihui Clinic Co., Ltd.
Tianjin Wangyi Cloud Co., Ltd. engages in the business of providing online hospital services including health consultancy services and online sales of medicines and health products through its two wholly owned PRC subsidiaries, Tian Jin Deyihui Online Hospital Co., Ltd. and Tian Jin Deyihui Clinic Co., Ltd.
On March 5, 2024, Tianjin Akso Enterprise Management Co., Ltd., our PRC subsidiary, entered into certain securities purchase agreements with four shareholders of Tianjin Wangyi Cloud Co., Ltd. and acquired 50% of the equity interests of Tianjin Wangyi Cloud Co., Ltd. The transaction closed on April 15, 2024.
On March 5, 2024, Tianjin Akso Enterprise Management Co., Ltd., our PRC subsidiary, entered into certain securities purchase agreements with four shareholders of Tianjin Wangyi Cloud Co., Ltd. and acquired 50% of the equity interests of Tianjin Wangyi Cloud Co., Ltd. The transaction closed on April 15, 2024.
Tianjin Wangyi Cloud Co., Ltd. engages in the business of providing online hospital services including health consultancy services and online sales of medicines and health products through its two wholly owned PRC subsidiaries, Tian Jin Deyihui Online Hospital Co., Ltd. and Tian Jin Deyihui Clinic Co., Ltd.
Tianjin Wangyi Cloud Co., Ltd. engages in the business of providing online hospital services including health consultancy services and online sales of medicines and health products through its two wholly owned PRC subsidiaries, Tian Jin Deyihui Online Hospital Co., Ltd. and Tian Jin Deyihui Clinic Co., Ltd.
These include: ● establishment registration and device listing with the FDA; ● QSR requirements, which require manufacturers and contract manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process; ● labeling regulations and FDA prohibitions against the promotion of investigational products, or “off-label” uses of cleared or approved products; ● requirements related to promotional activities; ● clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared devices; 67 ● medical device reporting regulations, which require that a manufacturer report to the FDA if a device it markets may have caused or contributed to a death or serious injury, or has malfunctioned and the device or ● a similar device that it markets would be likely to cause or contribute to a death or serious injury, if the malfunction were to recur; ● correction, removal and recall reporting regulations, which require that manufacturers report to the FDA field corrections, product removals or recalls if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health; ● the FDA’s recall authority, whereby the agency can order device manufacturers to recall from the market a product that is in violation of governing laws and regulations; and ● post-market surveillance activities and regulations, which apply when deemed by the FDA to be necessary to protect the public health or to provide additional safety and effectiveness data for the device.
These include: ● establishment registration and device listing with the FDA; ● QSR requirements, which require manufacturers and contract manufacturers, including third-party manufacturers, to follow stringent design, testing, control, documentation and other quality assurance procedures during all aspects of the design and manufacturing process; ● labeling regulations and FDA prohibitions against the promotion of investigational products, or “off-label” uses of cleared or approved products; ● requirements related to promotional activities; ● clearance or approval of product modifications to 510(k)-cleared devices that could significantly affect safety or effectiveness or that would constitute a major change in intended use of one of our cleared devices; 81 ● medical device reporting regulations, which require that a manufacturer report to the FDA if a device it markets may have caused or contributed to a death or serious injury, or has malfunctioned and the device or ● a similar device that it markets would be likely to cause or contribute to a death or serious injury, if the malfunction were to recur; ● correction, removal and recall reporting regulations, which require that manufacturers report to the FDA field corrections, product removals or recalls if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FDCA that may present a risk to health; ● the FDA’s recall authority, whereby the agency can order device manufacturers to recall from the market a product that is in violation of governing laws and regulations; and ● post-market surveillance activities and regulations, which apply when deemed by the FDA to be necessary to protect the public health or to provide additional safety and effectiveness data for the device.
If the FDA determines that we failed to comply with applicable regulatory requirements, it can take a variety of compliance or enforcement actions, which may result in any of the following sanctions: ● untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties; ● unanticipated expenditures to address or defend such actions; ● customer notifications for repair, replacement, refunds; ● recall, withdrawal, administrative detention or seizure of our test kits; ● operating restrictions or partial suspension or total shutdown of production; ● refusal of or delay in granting our requests for 510(k) clearance or PMA approval of new test kits or modified test kits; ● operating restrictions, partial suspension or total shutdown of production; ● withdrawing 510(k) clearance or PMA approvals that are already granted; ● refusal to grant export approval for our test kits; or ● criminal prosecution. 68 Health Insurance Portability and Accountability Act and Other Privacy Laws The federal Health Insurance Portability and Accountability Act of 1996, as amended by the Healthcare Information Technology for Economic and Clinical Health Act of 2009, or collectively HIPAA, among other things, established federal protection for the privacy and security of protected health information, or PHI.
If the FDA determines that we failed to comply with applicable regulatory requirements, it can take a variety of compliance or enforcement actions, which may result in any of the following sanctions: ● untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties; ● unanticipated expenditures to address or defend such actions; ● customer notifications for repair, replacement, refunds; ● recall, withdrawal, administrative detention or seizure of our test kits; ● operating restrictions or partial suspension or total shutdown of production; ● refusal of or delay in granting our requests for 510(k) clearance or PMA approval of new test kits or modified test kits; ● operating restrictions, partial suspension or total shutdown of production; ● withdrawing 510(k) clearance or PMA approvals that are already granted; ● refusal to grant export approval for our test kits; or ● criminal prosecution. 82 Health Insurance Portability and Accountability Act and Other Privacy Laws The federal Health Insurance Portability and Accountability Act of 1996, as amended by the Healthcare Information Technology for Economic and Clinical Health Act of 2009, or collectively HIPAA, among other things, established federal protection for the privacy and security of protected health information, or PHI.
On October 10, 2018, the PBOC, the CBIRC and CSRC together promulgated the Measures for the Anti-money Laundering and Anti-terrorist Finance of Internet Finance, which further specified that, any Internet finance institutions incorporated upon approval or upon record-filing by applicable regulatory authority, shall report any forms of cash receipts and payments whose transaction value reaches or exceeds RMB 50,000 or foreign currency equivalent of US$10,000 on a per-transaction or cumulative basis on a given day, within five working days from the date when such transaction takes place. 55 Regulations on Value-Added Telecommunication Services The Telecommunications Regulations promulgated by the State Council and its related implementation rules, including the Catalog of Classification of Telecommunications Business issued by the MIIT, amended in 2019 categorize various types of telecommunications and telecommunications-related activities into basic or value-added telecommunications services, and Internet information services, or ICP services, and on-line data processing and transaction processing services, are classified as value-added telecommunications businesses.
On October 10, 2018, the PBOC, the CBIRC and CSRC together promulgated the Measures for the Anti-money Laundering and Anti-terrorist Finance of Internet Finance, which further specified that, any Internet finance institutions incorporated upon approval or upon record-filing by applicable regulatory authority, shall report any forms of cash receipts and payments whose transaction value reaches or exceeds RMB 50,000 or foreign currency equivalent of US$10,000 on a per-transaction or cumulative basis on a given day, within five working days from the date when such transaction takes place. 69 Regulations on Value-Added Telecommunication Services The Telecommunications Regulations promulgated by the State Council and its related implementation rules, including the Catalog of Classification of Telecommunications Business issued by the MIIT, amended in 2019 categorize various types of telecommunications and telecommunications-related activities into basic or value-added telecommunications services, and Internet information services, or ICP services, and on-line data processing and transaction processing services, are classified as value-added telecommunications businesses.
Any failure or perceived failure by our Company, our subsidiaries, or the VIEs to comply with the above confidentiality and archives administration requirements under the revised Provisions and other PRC laws and regulations may result in the relevant entities being held legally liable by competent authorities, and referred to the judicial organ to be investigated for criminal liability if suspected of committing a crime.
Any failure or perceived failure by our Company or our subsidiaries to comply with the above confidentiality and archives administration requirements under the revised Provisions and other PRC laws and regulations may result in the relevant entities being held legally liable by competent authorities, and referred to the judicial organ to be investigated for criminal liability if suspected of committing a crime.
The staff of the NDRC addressed in an interview on 27 December, 2021 that certain existing overseas listed enterprises whose foreign investors’ shareholding percentage exceed the aforementioned threshold are not required to make adjustment or deduction. 54 Foreign Investment in Value-Added Telecommunication Services The Provisions on Administration of Foreign Invested Telecommunications Enterprises promulgated by the State Council in December 2001 and subsequently amended in September 2008 and 2016 prohibit a foreign investor from owning more than 50% of the total equity interest in any value-added telecommunications service business in China and require the major foreign investor in any value-added telecommunications service business in China to have a good and profitable record and operating experience in this industry.
The staff of the NDRC addressed in an interview on 27 December, 2021 that certain existing overseas listed enterprises whose foreign investors’ shareholding percentage exceed the aforementioned threshold are not required to make adjustment or deduction. 68 Foreign Investment in Value-Added Telecommunication Services The Provisions on Administration of Foreign Invested Telecommunications Enterprises promulgated by the State Council in December 2001 and subsequently amended in September 2008 and 2016 prohibit a foreign investor from owning more than 50% of the total equity interest in any value-added telecommunications service business in China and require the major foreign investor in any value-added telecommunications service business in China to have a good and profitable record and operating experience in this industry.
In addition, online marketplace platform providers may be jointly and severally liable with sellers and manufacturers if they are aware or should be aware that any seller or manufacturer is using the online platform to infringe upon the lawful rights and interests of consumers and fail to take measures necessary to prevent or stop such activity. 56 The Civil Code of the PRC, effective on January 1, 2021, also provides that if an online service provider is aware that an online user is committing infringing activities, such as selling counterfeit products, through its Internet services and fails to take necessary measures, it shall be jointly liable with the said online user for such infringement.
In addition, online marketplace platform providers may be jointly and severally liable with sellers and manufacturers if they are aware or should be aware that any seller or manufacturer is using the online platform to infringe upon the lawful rights and interests of consumers and fail to take measures necessary to prevent or stop such activity. 70 The Civil Code of the PRC, effective on January 1, 2021, also provides that if an online service provider is aware that an online user is committing infringing activities, such as selling counterfeit products, through its Internet services and fails to take necessary measures, it shall be jointly liable with the said online user for such infringement.
A PMA application, which is intended to demonstrate that the device is reasonably safe and effective for its intended use and must be supported by extensive data, typically including data from pre-clinical studies and clinical trials. 64 Emergency Use Authorization In emergency situations, such as a pandemic, the FDA has the authority to allow unapproved medical products or unapproved uses of cleared or approved medical products to be used in an emergency to diagnose, treat or prevent serious or life-threatening diseases or conditions caused by chemical, biological, radiological or nuclear warfare threat agents when there are no adequate, approved, and available alternatives.
A PMA application, which is intended to demonstrate that the device is reasonably safe and effective for its intended use and must be supported by extensive data, typically including data from pre-clinical studies and clinical trials. 78 Emergency Use Authorization In emergency situations, such as a pandemic, the FDA has the authority to allow unapproved medical products or unapproved uses of cleared or approved medical products to be used in an emergency to diagnose, treat or prevent serious or life-threatening diseases or conditions caused by chemical, biological, radiological or nuclear warfare threat agents when there are no adequate, approved, and available alternatives.
Foreign-invested enterprises established before the implementation of this Law may retain the original business organization and so on within five years after the implementation of this Law. 53 The Foreign Investment Law is formulated to further expand opening-up, vigorously promote foreign investment and protect the legitimate rights and interests of foreign investors.
Foreign-invested enterprises established before the implementation of this Law may retain the original business organization and so on within five years after the implementation of this Law. The Foreign Investment Law is formulated to further expand opening-up, vigorously promote foreign investment and protect the legitimate rights and interests of foreign investors.
Violations of the PRC Labor Law and the Labor Contract Law may result in the imposition of fines and other administrative sanctions, and serious violations may result in criminal liabilities. 61 Enterprises in China are required by PRC laws and regulations to participate in certain employee benefit plans, including social insurance funds, namely a pension plan, a medical insurance plan, an unemployment insurance plan, a work-related injury insurance plan and a maternity insurance plan, and a housing provident fund, and contribute to the plans or funds in amounts equal to certain percentages of salaries, including bonuses and allowances, of the employees as specified by the local government from time to time at locations where they operate their businesses or where they are located.
Violations of the PRC Labor Law and the Labor Contract Law may result in the imposition of fines and other administrative sanctions, and serious violations may result in criminal liabilities. 75 Enterprises in China are required by PRC laws and regulations to participate in certain employee benefit plans, including social insurance funds, namely a pension plan, a medical insurance plan, an unemployment insurance plan, a work-related injury insurance plan and a maternity insurance plan, and a housing provident fund, and contribute to the plans or funds in amounts equal to certain percentages of salaries, including bonuses and allowances, of the employees as specified by the local government from time to time at locations where they operate their businesses or where they are located.
By contrast, approval from or registration with appropriate government authorities is required where RMB is to be converted into foreign currency and remitted out of China to pay capital account items, such as direct investments, repayment of foreign currency-denominated loans, repatriation of investments and investments in securities outside of China. 59 In November 2012, SAFE promulgated the Circular of Further Improving and Adjusting Foreign Exchange Administration Policies on Foreign Direct Investment, mostly recently amended in December 2019, which substantially amends and simplifies the current foreign exchange procedure.
By contrast, approval from or registration with appropriate government authorities is required where RMB is to be converted into foreign currency and remitted out of China to pay capital account items, such as direct investments, repayment of foreign currency-denominated loans, repatriation of investments and investments in securities outside of China. 73 In November 2012, SAFE promulgated the Circular of Further Improving and Adjusting Foreign Exchange Administration Policies on Foreign Direct Investment, mostly recently amended in December 2019, which substantially amends and simplifies the current foreign exchange procedure.
An enterprise to be engaged in business operations of Class I or Class II medical devices is encouraged to set up such a system. 57 Advertisements of Medical Devices Pursuant to the Regulations on Tentative Measures for the Censorship of Advertisement for Drugs, Medical Devices, Dietary Supplements, Food Formula for Special Medical Purpose promulgated by SAMR on December 24, 2019 and came into effect on March 1, 2020, the State Administration for Market Regulation is responsible for organizing and guiding the review of advertisements for drugs, medical devices, health foods and formula foods for special medical purposes.
An enterprise to be engaged in business operations of Class I or Class II medical devices is encouraged to set up such a system. 71 Advertisements of Medical Devices Pursuant to the Regulations on Tentative Measures for the Censorship of Advertisement for Drugs, Medical Devices, Dietary Supplements, Food Formula for Special Medical Purpose promulgated by SAMR on December 24, 2019 and came into effect on March 1, 2020, the State Administration for Market Regulation is responsible for organizing and guiding the review of advertisements for drugs, medical devices, health foods and formula foods for special medical purposes.
In connection with the Re-Designation of the Authorized Capital, 7,980,800 ordinary shares owned by Webao Limited then and 492,019,200 authorized but unissued ordinary shares were converted into Class B ordinary shares on a one-for-one basis. 4,500,000,000 authorized ordinary shares (including 320,770,660 issued and outstanding ordinary shares held by all shareholders other than Webao Limited) were converted into Class A ordinary shares on a one-for-one basis. 46 Business Restructuring and Disposition Prior to our disposition of Hexin E-Commerce, on November 20, 2020, Mr.
In connection with the Re-Designation of the Authorized Capital, 7,980,800 ordinary shares owned by Webao Limited then and 492,019,200 authorized but unissued ordinary shares were converted into Class B ordinary shares on a one-for-one basis. 4,500,000,000 authorized ordinary shares (including 320,770,660 issued and outstanding ordinary shares held by all shareholders other than Webao Limited) were converted into Class A ordinary shares on a one-for-one basis. 55 Business Restructuring and Disposition Prior to our disposition of Hexin E-Commerce, on November 20, 2020, Mr.
Our application for listing in Nasdaq does not fall under the circumstance that such overseas listing is prohibited by the Trial Measures, nor do we need to go through the review such as security review or clearance approval from relevant authorities. 62 According to the CSRC Notice, the domestic companies that have already been listed overseas before the effective date of the Trial Measures (namely, March 31, 2023) shall be deemed as Existing Issuers.
Our application for listing in Nasdaq does not fall under the circumstance that such overseas listing is prohibited by the Trial Measures, nor do we need to go through the review such as security review or clearance approval from relevant authorities. 76 According to the CSRC Notice, the domestic companies that have already been listed overseas before the effective date of the Trial Measures (namely, March 31, 2023) shall be deemed as Existing Issuers.
This notice has amended SAFE Circular 37 requiring PRC residents or entities to register with qualified banks rather than SAFE or its local branch in connection with their establishment or control of an offshore entity established for the purpose of overseas investment or financing. 60 PRC residents or entities who had contributed legitimate onshore or offshore interests or assets to SPVs but had not obtained registration as required before the implementation of the SAFE Circular 37 must register their ownership interests or control in the SPVs with qualified banks.
This notice has amended SAFE Circular 37 requiring PRC residents or entities to register with qualified banks rather than SAFE or its local branch in connection with their establishment or control of an offshore entity established for the purpose of overseas investment or financing. 74 PRC residents or entities who had contributed legitimate onshore or offshore interests or assets to SPVs but had not obtained registration as required before the implementation of the SAFE Circular 37 must register their ownership interests or control in the SPVs with qualified banks.
If existing or future vaccines are widely distributed and compliantly administered or if therapeutic treatments are identified and become widely used, our COVID-19 testing opportunities and the market as a whole may shrink or disappear. 50 We believe the following factors affect our ability to compete successfully: ● test accuracy; ● timeliness in delivery of test results; ● user experience; ● cost control; ● pricing; ● manufacturing capability; and ● access to market.
If existing or future vaccines are widely distributed and compliantly administered or if therapeutic treatments are identified and become widely used, our COVID-19 testing opportunities and the market as a whole may shrink or disappear. 63 We believe the following factors affect our ability to compete successfully: ● test accuracy; ● timeliness in delivery of test results; ● user experience; ● cost control; ● pricing; ● manufacturing capability; and ● access to market.
Risk Factors—Risks Related to Our Business and Industry—We may be unable to protect our proprietary intellectual property rights from unauthorized use, such that our brand, reputation and business may be negatively impacted.” 51 Regulation PRC Regulations This section sets forth a summary of the most significant rules and regulations that affect our business activities in China.
Risk Factors-Risks Related to Our Business and Industry-We may be unable to protect our proprietary intellectual property rights from unauthorized use, such that our brand, reputation and business may be negatively impacted.” 65 Regulation PRC Regulations This section sets forth a summary of the most significant rules and regulations that affect our business activities in China.
Federal, state, local, and foreign data privacy and security obligations also may include penalties for noncompliance, as well as a private right of action. 69 C. Organizational Structure The following diagram illustrates our corporate structure, including our subsidiaries and consolidated affiliated entities as of the date of this annual report on Form 20-F: D.
Federal, state, local, and foreign data privacy and security obligations also may include penalties for noncompliance, as well as a private right of action. 83 C. Organizational Structure The following diagram illustrates our corporate structure, including our subsidiaries and consolidated affiliated entities as of the date of this annual report on Form 20-F: D.
Bulletin 37 further details and clarifies the tax withholding methods in respect of income of non-resident enterprises. 58 Pursuant to the Double Taxation Avoidance Arrangement, the withholding tax rate in respect to the payment of dividends by a PRC enterprise to a Hong Kong enterprise is reduced to 5% from a standard rate of 10% if the Hong Kong enterprise directly holds at least 25% of the PRC enterprise.
Bulletin 37 further details and clarifies the tax withholding methods in respect of income of non-resident enterprises. 72 Pursuant to the Double Taxation Avoidance Arrangement, the withholding tax rate in respect to the payment of dividends by a PRC enterprise to a Hong Kong enterprise is reduced to 5% from a standard rate of 10% if the Hong Kong enterprise directly holds at least 25% of the PRC enterprise.
Our registered office in the Cayman Islands is located at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104. Our agent for service of process in the United States is Law Debenture Corporate Services Inc., located at 801, 2nd Avenue, Suite 403, New York, NY 10017. 47 B.
Our registered office in the Cayman Islands is located at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104. Our agent for service of process in the United States is Law Debenture Corporate Services Inc., located at 801, 2nd Avenue, Suite 403, New York, NY 10017. 56 B.
Failure to comply with the conditions of approval can result in material adverse enforcement action, including withdrawal of the approval. 66 Certain changes to an approved device, such as changes in manufacturing facilities, methods, or quality control procedures, or changes in the design performance specifications, that affect the safety or effectiveness of the device, require submission of a PMA supplement.
Failure to comply with the conditions of approval can result in material adverse enforcement action, including withdrawal of the approval. 80 Certain changes to an approved device, such as changes in manufacturing facilities, methods, or quality control procedures, or changes in the design performance specifications, that affect the safety or effectiveness of the device, require submission of a PMA supplement.
Medicare has authorized reimbursement for certain forms of cancer treatment. Over the last several years, such third-party payors are increasingly challenging the cost effectiveness of medical products and services and taking other cost containment measures. 63 In the future, the Company may establish additional radiation oncology and cancer therapy services.
Medicare has authorized reimbursement for certain forms of cancer treatment. Over the last several years, such third-party payors are increasingly challenging the cost effectiveness of medical products and services and taking other cost containment measures. 77 In the future, the Company may establish additional radiation oncology and cancer therapy services.
In addition, the FDA collects user fees for certain medical device submissions and annual fees and for medical device establishments. 65 Before the FDA will accept a 510(k) submission for substantive review, the FDA will first assess whether the submission satisfies a minimum threshold of acceptability.
In addition, the FDA collects user fees for certain medical device submissions and annual fees and for medical device establishments. 79 Before the FDA will accept a 510(k) submission for substantive review, the FDA will first assess whether the submission satisfies a minimum threshold of acceptability.
Revenue attributable to the sales of medical equipment for the fiscal year ended March 31, 2024 was $2.4 million, representing 100% of the Company’s total revenue. Akso Health’s radiation oncology services business On September 24, 2021, the Board of Directors approved our new business plan to enter the radiation oncology services market in the U.S.
Revenue attributable to the sales of medical equipment for the fiscal year ended March 31, 2025 was $0.4 million, representing 2.8% of the Company’s total revenue. Akso Health’s radiation oncology services business On September 24, 2021, the Board of Directors approved our new business plan to enter the radiation oncology services market in the U.S.
Ming Jia and Mr. Shiwei Wu entered into a VIE termination agreement, which terminated all rights and obligations with respect to each party thereto under the 2018 Wusu VIE Agreements.
Shiwei Wu entered into a VIE termination agreement, which terminated all rights and obligations with respect to each party thereto under the 2018 Wusu VIE Agreements.
Consistent with the Guidance on the Pilot Establishment of Microlending Companies and Circular 141, the Rectification Implementation Plans of Online Microlending Companies emphasize several aspects where inspection and rectification measures must be carried out for the online microlending loans industry, which include, among others, (i) the online microlending companies shall be approved by the competent authorities in accordance with the applicable regulations promulgated by the State Council, and the approved online microlending companies subsequently in violation of any regulatory requirements shall be re-examined; (ii) qualification requirements to conduct online micro-loan business (including the qualification of sponsor shareholders, the sources of borrowers, the Internet scenario and the digital risk-management technology); (iii) whether the qualification and funding source of the shareholders of online microlending companies are in compliance with the applicable laws and regulations; (iv) whether the “integrated actual interest” (namely the aggregated borrowing costs charged to borrowers in the form of interest and various fees) are annualized and subject to the limit on the interest rate of private lending set forth in the Private Lending Judicial Interpretations issued by the Supreme People’s Court and, whether any interest, handling fee, management fee or deposit are deducted from the principal of loans provided to the borrowers in advance, prior to the repayment of the loan; (v) whether campus loans or online microlending loans with no specific scenario or designated use of loan proceeds are granted; (vi) with respect to the loan business conducted in cooperation with third-party institutions, whether the online microlending companies outsource the core business (including the credit assessment and risk control), or accept any credit enhancement service (whether or not in a disguised form) provided by any third-party institutions with no approval to provide financing guarantee and whether any applicable third-party institution collects any interest or fees from the borrowers; and (vii) entities that conduct online microlending loans business without relevant approval or license for lending business shall be shut down and banned. 52 The Rectification Implementation Plans of Online Microlending Companies also sets forth that all related institutions shall be subject to inspection and investigation.
The features of online microlending loans include online borrower acquisition, credit assessment based on the online information collected from the Internet enterprise’s business operations and the borrower’s Internet usage, as well as online loan application, approval and funding. 66 Consistent with the Guidance on the Pilot Establishment of Microlending Companies and Circular 141, the Rectification Implementation Plans of Online Microlending Companies emphasize several aspects where inspection and rectification measures must be carried out for the online microlending loans industry, which include, among others, (i) the online microlending companies shall be approved by the competent authorities in accordance with the applicable regulations promulgated by the State Council, and the approved online microlending companies subsequently in violation of any regulatory requirements shall be re-examined; (ii) qualification requirements to conduct online micro-loan business (including the qualification of sponsor shareholders, the sources of borrowers, the Internet scenario and the digital risk-management technology); (iii) whether the qualification and funding source of the shareholders of online microlending companies are in compliance with the applicable laws and regulations; (iv) whether the “integrated actual interest” (namely the aggregated borrowing costs charged to borrowers in the form of interest and various fees) are annualized and subject to the limit on the interest rate of private lending set forth in the Private Lending Judicial Interpretations issued by the Supreme People’s Court and, whether any interest, handling fee, management fee or deposit are deducted from the principal of loans provided to the borrowers in advance, prior to the repayment of the loan; (v) whether campus loans or online microlending loans with no specific scenario or designated use of loan proceeds are granted; (vi) with respect to the loan business conducted in cooperation with third-party institutions, whether the online microlending companies outsource the core business (including the credit assessment and risk control), or accept any credit enhancement service (whether or not in a disguised form) provided by any third-party institutions with no approval to provide financing guarantee and whether any applicable third-party institution collects any interest or fees from the borrowers; and (vii) entities that conduct online microlending loans business without relevant approval or license for lending business shall be shut down and banned.
The Company has since then focused on exploring other area of healthcare sector other than the medical devices and supplies. Recently, we begun exploring online hospital and chain pharmacies segments in China.
The Company has since then focused on exploring other area of healthcare sector other than the medical devices and supplies. Recently, we advanced our presence in online hospital and chain pharmacies segments in China.
We plan to acquire online hospital(s) in certain cities of China which provides online medical consultations for initial diagnosis, follow-up consultations, and management of chronic diseases, providing patients with an efficient and convenient solution to manage their health online through their smartphones or computers.
We continue to evaluate potential acquisitions of online hospital(s) in certain cities of China which provides online medical consultations for initial diagnosis, follow-up consultations, and management of chronic diseases, providing patients with an efficient and convenient solution to manage their health online through their smartphones or computers.
Our Customers Our medical devices business which includes the sale of COVID-19 Rapid Antigen test kits, defibrillators and anesthesia laryngoscopes primarily target medical product dealers and end-users such as hospitals. We do not currently have any long-term sale contracts with our customers.
Our Customers Sales of medical devices Our medical devices business which includes the sale of defibrillators and anesthesia laryngoscopes primarily target medical product dealers and end-users such as hospitals. We do not currently have any long-term sale contracts with our customers.
As part of our corporate restructurings prior to our disposal of Hexin E-Commerce in December 2020, Mr. Ming Jia and Mr. Shiwei Wu transferred their equity interests of Wusu Company to Hexin E-Commerce, and therefore, Hexin E-Commerce became the sole shareholder of Wusu Company on November 20, 2020. On November 20, 2020, Hexin Yongheng, Wusu Company, Hexin E-Commerce, Mr.
Shiwei Wu transferred their equity interests of Wusu Company to Hexin E-Commerce, and therefore, Hexin E-Commerce became the sole shareholder of Wusu Company on November 20, 2020. On November 20, 2020, Hexin Yongheng, Wusu Company, Hexin E-Commerce, Mr. Ming Jia and Mr.
We operate our newly launched social e-commerce platform Xiaobai Maimai through Hexin Digital. On September 30, 2019, we changed Wusu Company’s principal businesses from microlending to trading, provision of technological promotion services, and import and export. On July 15, 2020, we incorporated Hexin Investment Private Limited in Singapore with a view to engage in future investment activities.
We operate our newly launched social e-commerce platform Xiaobai Maimai through Hexin Digital. On September 30, 2019, we changed Wusu Company’s principal businesses from microlending to trading, provision of technological promotion services, and import and export.
Our planned radiation oncology service and cancer therapy centers would compete primarily on a regional or local basis with government-owned and private hospitals that offer radiotherapy, diagnostic imaging and other oncology healthcare services either directly or in conjunction with third parties, We would primarily compete with our competitors based on the range of services provided, the reputation of our cancer therapy and radiation oncology centers among doctors and patients in the U.S. and level of patient service and satisfaction.
Our planned radiation oncology service and cancer therapy centers would compete primarily on a regional or local basis with government-owned and private hospitals that offer radiotherapy, diagnostic imaging and other oncology healthcare services either directly or in conjunction with third parties.
Akso Online Meditech has entered into a supply agreement to purchase “iHealth” branded COVID-19 Rapid Antigen test kits from its supplier in Hong Kong and sells these test kits to distributors in the United States. 48 Since April 2022, the Company has engaged in the sale of medical devices such as defibrillators and anesthesia laryngoscope through its subsidiary, Qingdao Akso, in China.
Akso Online Meditech has entered into a supply agreement to purchase “iHealth” branded COVID-19 Rapid Antigen test kits from its supplier in Hong Kong and sells these test kits to distributors in the United States. Currently, the Company no longer to sell COVID-19 Rapid Antigen test kits since the cease of Covid-19 in the end of 2022.
Healthcare equipment and products trading and radiation oncology service business Sales of medical devices Through our operating subsidiaries, Akso Online Meditech and Qingdao Akso, we are mainly specialized in the sales of medical devices both in China and in the United States.
Healthcare equipment and products trading and radiation oncology service business Sales of medical devices Through our operating subsidiaries, Akso Online Meditech and Qingdao Akso, we are mainly specialized in the sales of medical devices both in China and in the United States. 57 On January 4, 2022, we incorporated Akso Online MediTech in the State of Wyoming and have begun the sale of COVID-19 Rapid Antigen test kits through Akso Online Meditech since March, 2022.
At the time of our acquisition, Phoenix Intelligent Credit Group Ltd was an operator of one of China’s leading P2P lending platforms and a wholly-owned subsidiary of Phoenix Financial Group Ltd., which was unrelated to us. 45 On August 1, 2019, Hexin Digital, which was established on September 9, 2017 with the provision of technology consultancy and technological services as its principal business, was acquired by Hexin Jinke from an independent third party, and Hexin Digital had minimal activities before being acquired by us.
On August 1, 2019, Hexin Digital, which was established on September 9, 2017 with the provision of technology consultancy and technological services as its principal business, was acquired by Hexin Jinke from an independent third party, and Hexin Digital had minimal activities before being acquired by us.
Regulations Relating to Foreign Investment PRC Foreign Investment Law The Foreign Investment Law was formally adopted by the second session of the 13th National People’s Congress on March 15, 2019, which has become effective on January 1, 2020 and, together with their implementation rules and ancillary regulations, has replaced the trio of existing laws regulating foreign investment in China, namely, the Sino-foreign Equity Joint Venture Enterprise Law, the Sino-foreign Cooperative Joint Venture Enterprise Law and the Wholly Foreign-invested Enterprise Law.
However, we have ceased new microlending business as the principal business scope of Wusu Company has been changed to trading, provision of technological promotion services and import and export since September 30, 2019, yet still entitled to the credit right over the loans issued prior to the change of the business scope. 67 Regulations Relating to Foreign Investment PRC Foreign Investment Law The Foreign Investment Law was formally adopted by the second session of the 13th National People’s Congress on March 15, 2019, which has become effective on January 1, 2020 and, together with their implementation rules and ancillary regulations, has replaced the trio of existing laws regulating foreign investment in China, namely, the Sino-foreign Equity Joint Venture Enterprise Law, the Sino-foreign Cooperative Joint Venture Enterprise Law and the Wholly Foreign-invested Enterprise Law.
Intellectual Property We have registered a website at http://www.ahgtop.com/en/index.html. To date, we have not experienced a material misappropriation of our intellectual property. Despite our efforts to protect our proprietary rights, third parties may attempt to use, copy or otherwise obtain and market or distribute our proprietary technology or develop a platform that is similar to our marketplace.
Despite our efforts to protect our proprietary rights, third parties may attempt to use, copy or otherwise obtain and market or distribute our proprietary technology or develop a platform that is similar to our marketplace.
Competition Radiation Oncology and Cancer Therapy Center Business The oncology healthcare service market in the United States is fragmented and competition is intense.
Our strategy focuses on building long-term partnerships by offering tailored health solutions. 62 Competition Radiation Oncology and Cancer Therapy Center Business The oncology healthcare service market in the United States is fragmented and competition is intense.
We believe our subsidiaries can be successful in mitigating negative effects resulting from unfavorable changes in the relationships with suppliers through, among other things, the development of new or expanded supplier relationships. We currently have one significant supplier, Qingdao Yongbaoyun Technology Co., Ltd.,s which represents 100.0% of our total purchases for the fiscal year ended March 31, 2024.
We believe our subsidiaries can be successful in mitigating negative effects resulting from unfavorable changes in the relationships with suppliers through, among other things, the development of new or expanded supplier relationships.
Qingdao Akso purchases these medical devices in bulk from its suppliers and distributes the products to downstream distributors and end-users.
Since April 2022, the Company has engaged in the sale of medical devices such as defibrillators and anesthesia laryngoscope through its subsidiary, Qingdao Akso, in China. Qingdao Akso purchases these medical devices in bulk from its suppliers and distributes the products to downstream distributors and end-users.
Akso Health’s radiation oncology services and Covid-19 research business model Currently, the Company is engaged in the sale of COVID-19 Rapid Antigen test kits. In the future, the Company will develop its the cancer therapy and radiation oncology market in the U.S.
For the Covid-19 research business which the Company engaged in the fiscal year ended March 31, 2022, initially focusing on the sale of COVID-19 Rapid Antigen test kits. Operations in this business ceased following the end of the pandemic. In the future, the Company will develop its the cancer therapy and radiation oncology market in the U.S.
Liu’s insights and guidance will support our mission in assembling the necessary team and infrastructure to build a best-in-class practice that’s scalable and delivers safe and high-quality cancer treatments for our patients.” 49 Our Suppliers Our subsidiaries source the medical devices, such as COVID-19 Rapid Antigen test kits, defibrillators and anesthesia laryngoscope, from its supplier in mainland China and Hong Kong.
Our Suppliers Sales of medical devices Our subsidiaries source the medical devices, such as COVID-19 Rapid Antigen test kits, defibrillators and anesthesia laryngoscope, from its supplier in mainland China and Hong Kong, and source the service related to its provision of marketing promotion service from mainland China.
Property, Plant and Equipment Our headquarters are located in Qingdao. We lease our premises from unrelated third parties free of charge. We believe that we will be able to obtain adequate facilities, principally through leasing, to accommodate our future expansion plans. ITEM 4A. UNRESOLVED STAFF COMMENTS None.
Property, Plant and Equipment Our headquarters are located in Qingdao. As of the date of the annual report, the Company had two paid leases of offices from unrelated third parties located in Tianjin and one premises we lease from unrelated third party free of charge.
Removed
On January 4, 2022, we incorporated Akso Online MediTech in the State of Wyoming and have begun the sale of COVID-19 Rapid Antigen test kits through Akso Online Meditech since March, 2022.
Added
At the time of our acquisition, Phoenix Intelligent Credit Group Ltd was an operator of one of China’s leading P2P lending platforms and a wholly-owned subsidiary of Phoenix Financial Group Ltd., which was unrelated to us.
Removed
Our three main customers are Xi’an Nazhi Hengsheng Medical Equipment Co., Ltd, Xuzhou Bowei Medical Equipment Co., Ltd. and Sichuan Nazhi Tongchuang Medical Equipment Co., Ltd, which represented approximately 34.8%, 36.3% and 28.0% of our total revenues for the fiscal year ended March 31, 2024.
Added
On July 15, 2020, we incorporated Hexin Investment Private Limited in Singapore with a view to engage in future investment activities. 54 As part of our corporate restructurings prior to our disposal of Hexin E-Commerce in December 2020, Mr. Ming Jia and Mr.
Removed
The features of online microlending loans include online borrower acquisition, credit assessment based on the online information collected from the Internet enterprise’s business operations and the borrower’s Internet usage, as well as online loan application, approval and funding.
Added
Tianjin Wangyi Cloud Co., Ltd. also engages in the year ended March 31, 2025, the provision of marketing promotion services business through its subsidiaries. Bing optimistic about the development prospect of the medical industry and the synergy between Internet medicine and offline hospitals .
Removed
However, we have ceased new microlending business as the principal business scope of Wusu Company has been changed to trading, provision of technological promotion services and import and export since September 30, 2019, yet still entitled to the credit right over the loans issued prior to the change of the business scope.
Added
The Company further acquired the remaining 50% equity interest of Tianjin Wangyi Cloud Co., Ltd. from its minority shareholders through transactions completed in June 2024 and December 2024. On December 10, 2024, the transaction was closed with the settlement of all consideration, and the Company currently holds 100% equity interest in Tianjin Wangyi Cloud Co., Ltd.
Added
Tianjin Wangyi Cloud Co., Ltd. also engages in the year ended March 31, 2025, the provision of marketing promotion services business through its subsidiaries. Bing optimistic about the development prospect of the medical industry and the synergy between Internet medicine and offline hospitals.
Added
The Company further acquired the remaining 50% equity interest of Tianjin Wangyi Cloud Co., Ltd. from its minority shareholders through transactions completed in June 2024 and December 2024. On December 10, 2024, the acquisition was closed upon the settlement of all consideration and , the Company currently holds 100% equity interest in Tianjin Wangyi Cloud Co., Ltd.
Added
In November 2024, we completed the acquisition of Tianjin Wangyi Cloud Co., Ltd. and its wholly owned subsidiaries, Tianjin Deyihui Online Hospital Co., Limited and Tianjin Deyihui Clinic Co., Limited (collectively “Deyihui Group”)，strengthening our foothold in internet healthcare.
Added
Future acquisitions of internet hospitals/clinics will be pursued at judicious timing based on real-time policy and market dynamics, reflecting our disciplined approach to capital allocation and investor accountability.
Added
Bing optimistic about the development prospect of the medical industry and the synergy between Internet medicine and offline hospitals. The Company further acquired the remaining 50% equity interest of Tianjin Wangyi Cloud Co., Ltd. from its minority shareholders through transactions completed in June 2024 and December 2024.
Added
On December 10, 2024, the acquisition was closed upon the settlement of all consideration and the Company currently holds 100% equity interest in Tianjin Wangyi Cloud Co., Ltd.
Added
Tianjin Wangyi Cloud Co., Ltd. also engages in the provision of marketing promotion service to car insurance broker industry.services business through its subsidiaries. The new business initiative involves Tianjin Deyihui Online Hospital Co., Ltd.
Added
Our focus is on creating a cutting-edge pharmacy system, enhancing service delivery through AI-driven health solutions, and expanding reach through an interconnected network of online and offline platforms.
Added
Liu’s insights and guidance will support our mission in assembling the necessary team and infrastructure to build a best-in-class practice that’s scalable and delivers safe and high-quality cancer treatments for our patients.” 58 Online Healthcare Services Business The Company begun engaging in the business of providing online hospital services, including health consultancy services and online sales of medicines and health products in China, through its two wholly owned PRC subsidiaries, Tian Jin Deyihui Online Hospital Co., Ltd. and Tian Jin Deyihui Clinic Co., Ltd, since it acquired the subsidiaries in April 2024.
Added
We are in the process of integrating medical products, telemedicine, and offline treatment platforms into a comprehensive healthcare information service system. Products and Services Our comprehensive product and service offerings will include: ● Pharmaceutical retail modernization: Enhancing traditional pharmacy operations. Traditional pharmacies face challenges that require new models to enhance competitiveness.
Added
The growing healthcare demands create market opportunities, and we can provide a more competitive development model for the traditional market with internet integration. ● Digital operations and sales solutions: Optimizing sales through digital channels.
Added
Customized smart speakers, smart photo frames, smart screens, and smart wearables, integrated with online consultation systems, will expand user engagement scenarios. ● Integrated online consultations: Offering AI-powered health assistants.
Added
By leveraging AI models like ChatGPT and training on health-related data, we can develop an AI health assistant capable of answering health inquiries for our consultation system. ● Community health stations: Facilitating physical health assessments and data integration.
Added
By establishing health stations in communities and deploying self-service health check kiosks, we can connect to internet hospital systems, allowing users to undergo offline health tests and integrate their health information into an online database. ● Insurance collaborations: Streamlining user services and expanding health coverage. We will partner with insurance companies and brokers to share revenue from these services.
Added
Growth Strategies/Marketing and Sales Strategy ● Digital presence enhancement: We are optimizing our online platforms for superior user engagement and employing targeted social media strategies to amplify brand reach. ● Community engagement: Through partnerships with local health service centers, we plan to deepen our offline presence and increase user acquisition. ● Talent development: Our strategy includes attracting and retaining top talent to strengthen our team’s capabilities, ensuring sustained business growth and innovation.
Added
Revenue Model ● Direct sales through our online health product marketplace. We will sell pharmaceutical products to hospital inpatients and outpatients in accordance with medical prescriptions. AHG recognizes the revenue on the consolidated basis when the pharmaceutical products are physically transferred to patients and fees can be collected.
Added
AHG is considered as a principal in the sale of pharmaceutical products because it takes inventory risk for the goods that are to be sold; accordingly, revenue is recognized on a gross basis. The performance obligation is the transfer of possession and control of the pharmaceutical product to the patient. We will also sell medical supplies to hospitals or clinics.
Added
AHG recognizes the revenue on the consolidated basis when the medical supplies are handed over to clinics and proceeds can be collected. The performance obligation is the transfer control and possession of the products to the hospitals or clinics.
Added
AHG is considered as a principal when its sells the medical supplies because it takes inventory risk for the goods to be sold; accordingly, revenue is recognized on a gross basis. Payments is typically received after delivery of products. 59 ● Medical service fees from Tianjin Deyihui Online Hospital’s diagnostic and treatment offerings.
Added
We plan to provide various medical and clinical services to patients. AHG recognizes revenue on a consolidated basis when individual deliverable services such as diagnosis, lab work, scans, consultation, and treatments, have been provided to the patients.
Added
Medical and clinical service revenue is recognized on a gross basis, as AHG is responsible to supervise, evaluate, manage, and compensate medical staff who deliver the services, and AHG has discretion in establishing the pricing for services charged to patients. The performance obligation is the provision of services detailed above to patients.
Added
Each deliverable service is typically completed in a single visit. Payment is received from patients after completion of each visit as well as through reimbursement by the government. For example, their system will identify whether each medical treatment requires a reimbursement and the specific proportion of that reimbursement according to the details of the patient’s treatment.
Added
The system will then record the reimbursement and such will be allocated by the Medical Insurance Bureau on a monthly aggregated amount. The Medical Insurance Bureau’s cycle to provide reimbursements is generally about 60-90 days. Specific price concessions and charitable assistance provided is carried out according to the overall arrangement of the hospital.
Added
For poor patients and those with special diseases, such patients will be given a discount. ● Collaborative profit-sharing with insurance partners. Commission will be generated from sales of medical insurance. AHG, through AHG Online Search Engine, will market and sell insurance policies originated by multiple insurance carriers via offline and online platforms.
Added
AHG recognizes the commission revenue on a net basis as it acts as an agency in these transactions and is not responsible for fulfilling the promise to provide the specified insurance products. AHG recognizes revenue at the point of time when the insurance policy has been issued to the policyholder.
Added
Payments are typically either made in advance or upon completion of the writing of the policy. ● Technical and brand collaborations to generate additional revenue from program development and marketing services We plan to provide medical software services to hospitals and/or clinics.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Discontinued Operations According to ASC 205, the effect of discontinued operations of commission service from social from social E-commerce business and interest income from microlending business and other related services for the fiscal years ended March 31, 2022 and 2023 and 2024 has been accounted for retroactively in the consolidated statement of operations for all the periods presented.
Discontinued Operations According to ASC 205, the effect of discontinued operations of commission service from social E-commerce business and interest income from microlending business and other related services for the fiscal years ended March 31, 2023 and 2024 has been accounted for retroactively in the consolidated statement of operations for all the periods presented.
For a detailed discussion of our significant accounting policies and related judgments, please see “Note 2—Summary of Significant Accounting Policies” of our consolidated financial statements included elsewhere in this annual report. You should read the following description of critical accounting estimates in conjunction with our consolidated financial statements and other disclosures included in this annual report.
For a detailed discussion of our significant accounting policies and related judgments, please see “Note 2-Summary of Significant Accounting Policies” of our consolidated financial statements included elsewhere in this annual report. You should read the following description of critical accounting estimates in conjunction with our consolidated financial statements and other disclosures included in this annual report. 94
Trend Information Other than as disclosed elsewhere in this annual report on Form 20-F, we are not aware of any trends, uncertainties, demands, commitments or events for the fiscal year ended March 31, 2024 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
Trend Information Other than as disclosed elsewhere in this annual report on Form 20-F, we are not aware of any trends, uncertainties, demands, commitments or events for the fiscal year ended March 31, 2025 that are reasonably likely to have a material adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future operating results or financial conditions.
This discussion and analysis may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Item 3. Key Information—D. Risk Factors” or in other parts of this annual report on Form 20-F. 70 A.
This discussion and analysis may contain forward-looking statements based upon current expectations that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under “Item 3. Key Information-D. Risk Factors” or in other parts of this annual report on Form 20-F. 84 A.
We believe that our current cash, cash flows provided by operating activities and net proceeds from our initial public offering will be sufficient to meet our working capital needs in the next 12 months from the date of this annual report on Form 20-F. 76 Substantially all of our operations are conducted in China, and all of our revenue, expenses, cash and cash equivalents are denominated in RMB.
We believe that our current cash, cash flows provided by operating activities and net proceeds from our initial public offering will be sufficient to meet our working capital needs in the next 12 months from the date of this annual report on Form 20-F. 93 Substantially all of our operations are conducted in China, and all of our revenue, expenses, cash and cash equivalents are denominated in RMB.
Total other income (expense) Our total other expenses, net was US$0.5 million for the fiscal year ended March 31, 2024, compared with total other income, net of US$1.2 million in the fiscal year ended March 31, 2023, the changes was primarily attributable to exchange gain (loss). 74 Provision for income tax Our income tax expense was US$ 24,988 for the fiscal year ended March 31, 2024, as compared to US$17,549 for the fiscal year ended March 31, 2023.
Total other income (expense) Our total other expenses, net was US$0.5 million for the fiscal year ended March 31, 2024, compared with total other income, net of US$1.2 million in the fiscal year ended March 31, 2023, the changes was primarily attributable to exchange gain (loss). 91 Provision for income tax Our income tax expense was US$ 24,988 for the fiscal year ended March 31, 2024, as compared to US$17,549 for the fiscal year ended March 31, 2023.
On July 2, 2023, the June Offering was consummated when all the closing conditions of the June SPA were satisfied. The net proceeds of approximately US$62.6 million from the June Offering will be used by the Company for working capital and general corporate purposes.
On July 2, 2024, the June Offering was consummated when all the closing conditions of the June SPA were satisfied. The net proceeds of approximately US$62.6 million from the June Offering will be used by the Company for working capital and general corporate purposes.
Based on the Company’s evaluation, it has been concluded that there are no significant uncertain tax positions requiring recognition in the Company’s financial statements. The Company does not believe that there was any uncertain tax position at March 31, 2024 and 2023.
Based on the Company’s evaluation, it has been concluded that there are no significant uncertain tax positions requiring recognition in the Company’s financial statements. The Company does not believe that there was any uncertain tax position at March 31, 2025 and 2024.
In addition to our plan to acquire online hospital(s), we believe that traditional independent pharmacies in China currently face serious competition and bottlenecks in sales growth, which is why we also plan to acquire multiple independent pharmacies nationwide throughout China, integrating and operating the pharmacies as a chain using our extensive offline resources and IT solutions.
In addition to our plan to acquire online hospital(s), we believe that traditional independent pharmacies in China currently face serious competition and bottlenecks in sales growth, which is why we also plan to acquire multiple independent pharmacies nationwide throughout China subject to favorable market and regulatory conditions, integrating and operating the pharmacies as a chain using our extensive offline resources and IT solutions.
We plan to acquire online hospital(s) in certain cities of China which provides online medical consultations for initial diagnosis, follow-up consultations, and management of chronic diseases, providing patients with an efficient and convenient solution to manage their health online through their smartphones or computers.
We continue to evaluate potential acquisitions of online hospital(s) in certain cities of China which provides online medical consultations for initial diagnosis, follow-up consultations, and management of chronic diseases, providing patients with an efficient and convenient solution to manage their health online through their smartphones or computers.
Results from these discontinued operations, net of income tax, were losses of USD 12.7 million, income of USD 11.8 million, and losses of USD 0.4 million for the fiscal years ended March 31, 2022, 2023 and 2024, respectively. 71 Key Components of Results of Operations Revenues Revenues are from the sale of medical devices business.
Results from these discontinued operations, net of income tax, were income of USD 11.8 million, losses of USD 0.4 million and nil for the fiscal years ended March 31, 2023, 2024 and 2025, respectively. Key Components of Results of Operations Revenues Revenues are from the sale of medical devices business.
As of March 31, 2022, 2023 and 2024, we had US$18.4 million, US$7.9 million, and US$85.2 million, respectively, in cash on hand and cash deposited with banks. As of March 31, 2022, 2023 and 2024, our working capital (excluding the amount due from related parties) amounted to US$12.2 million, US$8.8 million, and US$138.4 million, respectively.
As of March 31, 2023, 2024 and 2025, we had US$7.9 million, US$85.2 million, and US$176.2 million, respectively, in cash on hand and cash deposited with banks. As of March 31, 2023, 2024 and 2025, our working capital (excluding the amount due from related parties) amounted to US$8.8 million, US$138.4 million, and US$182.3 million, respectively.
Consequently, income taxes are not reflected in the Company’s financial statements. 73 Results of Operations The following table sets forth a summary of our consolidated results of operations for the periods indicated, both in absolute amount and as a percentage of our net revenue This information should be read together with our consolidated financial statements and related notes included elsewhere in this annual report on Form 20-F.
Results of Operations The following table sets forth a summary of our consolidated results of operations for the periods indicated, both in absolute amount and as a percentage of our net revenue This information should be read together with our consolidated financial statements and related notes included elsewhere in this annual report on Form 20-F.
Qingdao Akso purchases medical devices in quantity and distribute products primarily to medical products dealers or end-users such as hospitals. The deliveries may take one day or longer depending on the customers’ location. Revenue from sales of merchandise to non-retail customers is recognized when the merchandise is transferred to customers. There was no sales return since the start the business.
Qingdao Akso purchases those medical devices in quantity and distributes products to medical products dealers and ender-users. The deliveries may take one day or longer depending on the customers’ location. Revenue from sales of merchandise to non-retail customers is recognized when the merchandise is transferred to customers. There was no sales return since the start of the business.
Liquidity and Capital Resources We have financed our operations primarily through cash provided by operating activities, the loans from third parties and shareholder, and proceeds from private placement and short term loan from SOS Information Technology New York, Inc. We plan to finance our future operations primarily from cash generated from our operations and cash on hand.
Liquidity and Capital Resources We have financed our operations primarily through cash provided by operating activities, the loans from third parties and shareholder, and proceeds from private placement and short term loan from related party. We plan to finance our future operations primarily from cash generated from our operations and cash on hand.
The Company is considered an exempted Cayman Islands Company and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States.
The Company is considered an exempted Cayman Islands Company and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. Consequently, income taxes are not reflected in the Company’s financial statements.
Net (loss) from continuing operations Loss from continuing operations, net of income taxes, for fiscal year ended March 31, 2023, was US$13.1 million, compared to US$4.1 million in the same prior period of fiscal year 2022. Net loss from continuing operations was mainly resulted from general and administrative expenses.
Net loss from continuing operations Loss from continuing operations, net of income taxes, for fiscal year ended March 31, 2025, was approximately US$135.5 million, compared to US$9.1 million in the same prior period of fiscal year 2024. Net loss from continuing operations was mainly resulted from general and administrative expenses.
The following table sets forth the components of our revenues by amounts and percentages of our total revenues for the periods presented: 2022 2023 2024 % of % of % of (US$) revenues (US$) revenues (US$) revenues Revenues Sale of medical devices 6,000,000 100.0 % 13,186,525 100.0 % 2,416,797 100.0 % Total revenues 6,000,000 100.0 % 13,186,525 100.0 % 2,416,797 100.0 % Business and sales related taxes — — % 4,964 0.1 % 2,459 0.1 % Net Revenues 6,000,000 100.0 % 13,181,561 99.9 % 2,414,338 99.9 % Sale of medical devices Starting in February 2022, through its subsidiary Akso Online MediTech, the Company engaged in the sale of Covid-19 Antigen Rapid Tests in US market.
The following table sets forth the components of our revenues by amounts and percentages of our total revenues for the periods presented: 2023 2024 2025 % of % of % of (US$) revenues (US$) revenues (US$) revenues Revenues Sale of medical devices revenue 13,186,525 100 % 2,416,797 100 % 415,020 3 % Marketing promotion service revenue - - % - - % 14,366,602 97 % Total revenues 13,186,525 100 % 2,416,797 100 % 14,781,622 100 % Business and sales related taxes 4,964 0.1 % 2,459 0.1 % 3,824 0.1 % Net Revenues 13,181,561 99.9 % 2,414,338 99.9 % 14,777,798 99.9 % Sale of medical devices Since February 2022, through its subsidiary Akso Online MediTech, the Company engaged in the sale of Covid-19 Antigen Rapid Tests in U.S. market.
Recent Developments Amendment to Authorized Share Capital On April 30, 2024, the shareholders of the Company approved and adopted an amended and restated memorandum and articles of association (the “Amended M&A”), which changed the authorized issued share capital of the Company from US$500,000 divided into 5,000,000,000 ordinary shares, par value US$0.0001 each, to US$500,000 divided into 4,500,000,000 Class A ordinary shares, par value US$0.0001 each and 500,000,000 Class B ordinary shares, par value US$0.0001 each (the “Re-Designation of the Authorized Capital”).
The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the consolidated balance sheets, consolidated statements of operations and comprehensive loss (income) and consolidated statements of cash flows. 92 Recent Developments Amendment to Authorized Share Capital On April 30, 2024, the shareholders of the Company approved and adopted an amended and restated memorandum and articles of association (the “Amended M&A”), which changed the authorized issued share capital of the Company from US$500,000 divided into 5,000,000,000 ordinary shares, par value US$0.0001 each, to US$500,000 divided into 4,500,000,000 Class A ordinary shares, par value US$0.0001 each and 500,000,000 Class B ordinary shares, par value US$0.0001 each (the “Re-Designation of the Authorized Capital”).
For the Fiscal Years Ended March 31, 2022 2023 2024 US$ US$ US$ NET REVENUES 6,000,000 13,181,561 2,414,338 Cost of goods sold 5,394,866 11,912,571 2,292,206 Gross Profit 605,134 1,268,990 122,132 OPERATING EXPENSES Sales and marketing — 6,661 168,421 General and administrative 2,669,834 15,529,182 8,591,751 Finance cost 804,138 — — Share-based compensation 391,625 — — Total operating expenses 3,865,597 15,535,843 8,760,172 LOSS FROM CONTINUING OPERATIONS (3,260,463 ) (14,266,853 ) (8,638,040 ) Total other income (loss), net (747,818 ) 1,200,364 (453,751 ) LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (4,008,281 ) (13,066,489 ) (9,091,791 ) Provision for income tax 92,816 17,549 24,988 NET LOSS FROM CONTINUING OPERATIONS (4,101,097 ) (13,084,038 ) (9,116,779 ) Net (loss) income from discontinued operations, net of income taxes (12,748,636 ) 11,836,612 (3,884 ) Loss from disposal of discontinued operations, net of income taxes — — (395,914 ) Total (loss) income from discontinued operations (12,748,636 ) 11,836,612 (399,798 ) NET LOSS (16,849,733 ) (1,247,426 ) (9,516,577 ) The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense.
For the Fiscal Years Ended March 31, 2023 2024 2025 US$ US$ US$ NET REVENUES 13,181,561 2,414,338 14,777,798 Cost of goods sold 11,912,571 2,292,206 15,059,324 Gross Profit 1,268,990 122,132 (281,526 ) OPERATING EXPENSES Sales and marketing 6,661 168,421 - General and administrative 15,529,182 8,591,751 3,641,446 Impairment of goodwill and intangible assets - - 162,381,380 Total operating expenses 15,535,843 8,760,172 166,022,826 LOSS FROM CONTINUING OPERATIONS (14,266,853 ) (8,638,040 ) (166,304,352 ) Total other income (loss), net 1,200,364 (453,751 ) 34,073 LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES (13,066,489 ) (9,091,791 ) (166,270,279 ) Provision (benefit) for income tax 17,549 24,988 (30,801,146 ) NET LOSS FROM CONTINUING OPERATIONS (13,084,038 ) (9,116,779 ) (135,469,133 ) Net (loss) income from discontinued operations, net of income taxes 11,836,612 (3,884 ) - Loss from disposal of discontinued operations, net of income taxes - (395,914 ) - Total (loss) income from discontinued operations 11,836,612 (399,798 ) - NET LOSS (1,247,426 ) (9,516,577 ) (135,469,133 ) The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense.
ASC 740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.
ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized. 87 ASC 740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return.
The June Warrants shall expire five years from its date of issuance and are subject to customary anti-dilution provisions reflecting stock dividends and splits or other similar transactions. B.
The June Warrants shall expire five years from its date of issuance and are subject to customary anti-dilution provisions reflecting stock dividends and splits or other similar transactions. October 2024 Private Placement On October 24, 2024, the Company entered into certain securities purchase agreement (the “SPA”) with certain “non-U.S.
The following table sets forth our revenues breakdown for the periods indicated: For the Fiscal Years Ended March 31, 2022 2023 2024 (US$) (US$) (US$) Revenues(1) Sale of medical devices 6,000,000 13,186,525 2,416,797 Total revenues 6,000,000 13,186,525 2,416,797 Business and sales related taxes — 4,964 2,459 Net Revenues 6,000,000 13,181,561 2,414,338 (1) Represents amounts net of VAT.
The following table sets forth our revenues breakdown for the periods indicated: For the Fiscal Years Ended March 31, 2023 2024 2025 (US$) (US$) (US$) Revenues(1) Sale of medical devices 13,186,525 2,416,797 415,020 Marketing promotion services - - 14,366,602 Total revenues 13,186,525 2,416,797 14,781,622 Business and sales related taxes 4,964 2,459 3,824 Net Revenues 13,181,561 2,414,338 14,777,798 (1) Represents amounts net of VAT. 88 Fiscal Year Ended March 31, 2025 Compared to Fiscal Year Ended March 31, 2024 Net revenues Net revenues generated for the fiscal year ended March 31, 2025 was approximately US$14.8 million, representing an increase of 512.1% from approximately US$2.4 million for the fiscal year ended March 31, 2024.
We had net losses of US$16.8 million, net losses of US$1.2 million and net losses of 9.5 million for the years ended March 31, 2022, 2023, and 2024, respectively. Recently, we begun exploring online hospital and chain pharmacies segments in China.
We had net losses of US$1.2 million, net losses of US$9.5 million and net losses of 94.1 million for the years ended March 31, 2023, 2024, and 2025, respectively.
Net loss As a result of the above factors, we had net loss of US$1.2 million for the fiscal year ended March 31, 2023, compared to net loss of US$16.8 million for the fiscal year ended March 31, 2022. 75 Changes in Financial Position As of March 31, 2024, our cash and cash equivalents were US$85.2 million, representing an increase of US$77.3 million from US$7.9 million as of March 31, 2023, mainly due to an increase in cash provided by financing activities.
The fund from financing activities for the years ended March 31, 2025 and 2024 primarily attributable to the funds from private placements. As of March 31, 2024, our cash and cash equivalents were US$85.2 million, representing an increase of US$77.3 million from US$7.9 million as of March 31, 2023, mainly due to an increase in cash provided by financing activities.
Net income (loss) from discontinued operations, net of income taxes Net income from discontinued operations, net of income taxes, for fiscal year ended March 31, 2023, was US$11.8 million, compared to a loss of US$12.7 million in the prior period.
Net income from discontinued operations, net of income taxes Net income from discontinued operations, net of income taxes, for fiscal year ended March 31, 2025, was nil, compared to approximately US$0.4 million in the prior period. The Company completed the disposal of social E-commerce business in the fiscal year 2024.
The following table sets forth a breakdown of our operating costs and expenses for the periods indicated: For the Fiscal Years Ended March 31, 2022 2023 2024 US$ US$ US$ Operating expenses Sales and marketing expenses — 6,661 168,421 General and administrative expenses 2,669,834 15,529,182 8,591,751 Finance cost 804,138 — — Share-based compensation 391,625 — — Total operating expenses 3,865,597 15,535,843 8,760,172 Sales and marketing expenses Sales and marketing expenses consist primarily of expenses for building our brand recognition and opening up new market related to our sales of medical devices business.
The following table sets forth a breakdown of our operating costs and expenses for the periods indicated: For the Fiscal Years Ended March 31, 2023 2024 2025 US$ US$ US$ Operating expenses Sales and marketing expenses 6,661 168,421 - General and administrative expenses 15,529,182 8,591,751 3,641,444 Impairment of goodwill and intangible assets - - 162,381,380 Total operating expenses 15,535,843 8,760,172 166,022,826 Sales and marketing expenses Sales and marketing expenses consist primarily of promotion and advertising expenses and other daily expenses which are related to the selling and marketing departments.
Qingdao Akso has entered into supply agreements to purchase medical devices such as defibrillators, anesthesia laryngoscope from its supplier and sells these devices to distributers or end-users in China. Our net revenues were US$6.0 million, US$13.2 million, and US$2.4 million for the fiscal years ended March 31, 2022, 2023, and 2024 respectively.
Qingdao Akso has entered into supply agreements to purchase medical devices such as defibrillators, anesthesia laryngoscope from its supplier and sells these devices to distributers or end-users in China. We also advance our presence in online hospital and chain pharmacies segments in China.
As of March 31, 2023, our cash and cash equivalents were US$7.9 million, representing a decrease of US$10.5 million from US$18.4 million as of March 31, 2022, mainly due to an increase in cash used in financing activities.
Changes in Financial Position As of March 31, 2025, our cash and cash equivalents were US$176.2 million, representing an increase of US$91.1 million from US$85.2 million as of March 31, 2024, mainly due to an increase in cash used in investing activities and cash provided by financing activities.
For the fiscal year ended March 31, 2023, our net cash used in financing activities was US$27.5 million, compared to net cash generated from financing activities of US$34.8 million for the fiscal year ended March 31, 2022, primarily attributable to the repayment of loan from related party.
For the fiscal year ended March 31, 2025, our net cash used in investing activities was US$105.9 million, compared to net cash of US$54.7 used in investing activities for the year ended March 31, 2024; and net cash provided by financing activities was US$195.9 million for the year ended March 31, 2025, compared to net cash of US$131.7 million provided by financing activities for the year ended March 31, 2024.
Total other expenses Our other expense was US$1.2 million for the fiscal year ended March 31, 2023, as compared to other loss of US$0.7 million for the fiscal year ended March 31, 2022, the increase was primarily due to exchange gain.
And as a result, the Company recorded a goodwill impairment charge of approximately US$41.4 million for the year ended March 31, 2025. 90 Total other income (expense) Our total other income, net was US$34,073 for the fiscal year ended March 31, 2025, compared with total other expense, net of US$0.5 million in the fiscal year ended March 31, 2024, the changes was primarily attributable to a decrease of approximately US$0.2 million from interest income and a decrease of approximately US$0.6 million from exchange loss.
Fiscal Year Ended March 31, 2023 Compared to Fiscal Year Ended March 31, 2022 Net revenues Net revenues generated for the fiscal year ended March 31, 2023 was US$13.2 million, increased from US$6.0 million in the fiscal year ended March 31, 2022.
Sale of medical devices Revenue from medical devices was approximately US$0.4 million, decrease from approximately US$2.4 million for the year ended March 31, 2024, the decrease was primarily due to decrease of market demand in fiscal year 2025.
General and administrative expenses General and administrative expenses consist primarily of salaries and benefits related to our management, professional service fees and provisions made for uncollected receivables. 72 Finance cost Finance cost consists primarily of interest expenses for loans from related parties and senior notes.
Advertising expenses are expensed as incurred and were US$6,661, US$168,421 and nil for the year ended March 31, 2023, 2024 and 2025, respectively. General and administrative expenses General and administrative expenses consist primarily of salaries and benefits related to our management, professional service fees, depreciation and amortization expenses, provisions made for uncollected receivables.
The increase was primarily due to an increase in general and administrative expenses. ● Sales and marketing expenses Sales and marketing expenses for the fiscal year ended March 31, 2023 were US$ 6,661, compared to nil for the fiscal year ended March 31, 2022.
The increase was primarily due to a decrease of 100% or approximately US$0.2 million in sales and marketing expenses and an increase of 1,823.4% or approximately US$157.4 million in general and administrative expenses.
Provision for income tax Our income tax expense was US$17,549 for the fiscal year ended March 31, 2023, as compared to US$82,816 for the fiscal year ended March 31, 2022.
(Benefit) provision for income tax The income tax benefit was approximately US$30.8 million in the fiscal year ended March 31, 2025, compared to income tax expense of approximately US$ 24,988 for the fiscal year ended March 31, 2024. The income tax benefit generated from intangible assets recognized in the business acquisition.
The increase was primarily due to expenses related to the Company’s brand building and market development for its new business. ● General and administrative expenses General and administrative expenses for the fiscal year ended March 31, 2023 were US$15.5 million, a increase of 481.7% from US$2.7 million for the fiscal year ended March 31, 2022.
General and administrative expenses General and administrative expenses for the year ended March 31, 2025 was approximately US$3.6 million, a decrease of 57.6%, or US$5.0 million, from approximately US$8.6 million for the year ended March 31, 2024.
Removed
Akso Online MediTech purchases medical devices in quantity and distributes products primarily to medical products dealers. Since April 2022, through its subsidiary Qingdao Akso Health Management Co., Ltd, the Company started its sales of medical devices business in China domestic market.
Added
In November 2024, we completed the acquisition of Tianjin Wangyi Cloud Co., Ltd. and its wholly owned subsidiaries, Tianjin Deyihui Online Hospital Co., Limited and Tianjin Deyihui Clinic Co., Limited (collectively “Deyihui Group”)，strengthening our foothold in internet healthcare.
Removed
Cost of goods sold Cost of goods sold consist primarily of purchase price of COVID-19 Antigen Test kit, defibrillators and anesthesia laryngoscope related to the sale of medical devices. Operating expenses Our operating expenses primarily consist of sales and marketing expenses, general and administrative expenses, finance cost and share-based compensation.
Added
Future acquisitions of internet hospitals/clinics will be pursued at judicious timing based on real-time policy and market dynamics, reflecting our disciplined approach to capital allocation and investor accountability.
Removed
Share-based compensation Share-based compensation are expenses related to awards granted under the Amended and Restated 2016 Equity Incentive Plan which began vesting on November 3, 2017. Income Taxes The Company accounts for income taxes under ASC Topic 740, Income Taxes (“ASC 740”).
Added
Being optimistic about the development prospects and synergies of combination for online and offline medical resources , the Company acquiring the remaining 50% equity interest of Tianjin Wangyi Cloud and its two wholly owned subsidiaries from the minority shareholders and started to conduct marketing promotion services in car insurance industry.
Removed
ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.
Added
The acquisition was closed on December 10, 2024 upon the settlement of consideration. Tianjin Wangyi Cloud Co., Ltd. also engages in the provision of marketing promotion services business through its subsidiaries. 85 Our net revenues were US$13.2 million, US$2.4 million, and US$14.8 million for the fiscal years ended March 31, 2023, 2024, and 2025, respectively.
Removed
The Company’s revenue generated from its new business for the sales of medical devices, which was initially started in US market in January 2022, and since April 2022, the Company started its business in PRC domestic market.
Added
Akso Online MediTech purchases medical devices in quantity and distributes products primarily to medical products dealers. The deliveries may take one day or longer depending on the customers’ location. Revenue from sales of merchandise to non-retail customers is recognized when the merchandise is transferred to customers. There was no sales return since the start of the business.
Removed
Cost of goods sold Cost of goods sold consist primarily of purchase price of COVID-19 Antigen Test kit related to the sale of medical devices. Operating costs and expenses Total operating expenses for the fiscal year ended March 31, 2023 were US$15.5 million, an increase of 301.9% from US$3.9 million for the fiscal year ended March 31, 2022.
Added
Since the end of COVID-19 in the beginning of 2023, the Company ceased the sale of COVID-19 Rapid Antigen test kits in US market. Since April 2022, through its subsidiary Qingdao Akso, the Company engaged in the sale of medical devices such as defibrillators and anesthesia laryngoscope in market of China.
Removed
The increase was primarily attributable to the increase of provisions made for the uncollected receivables. ● Finance cost Finance cost for the fiscal year ended March 31, 2023 was nil compared to US$0.8 million for the fiscal year ended March 31, 2022. ● Share-based compensation Share-based compensation for the fiscal year ended March 31, 2023 was nil, compared to US$0.4 million in the fiscal year ended March 31, 2022 The decrease was attributable to increase in the recognition of the share-based compensation in connection with the options and restricted share units granted under the Amended and Restated 2016 Equity Incentive Plan.
Added
Marketing promotion service Since April 2024, through its subsidiary Tianjin Wangyi Cloud Technology Co., Ltd, the Company engaged in providing marketing promotion service to insurance broker agencies. By recommendation of potential car insurance purchaser to the insurance broker agencies, the Company earns commissions from those agencies upon the completion of recommendation services.
Removed
Recent Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740). ASU No. 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as additional information on income taxes paid. The guidance is effective for annual periods beginning after December 15, 2024 on a prospective basis. Early adoption is permitted.
Added
The commission fees are calculated on a fixed amount per car user based on the agreements with different insurance brokers.
Removed
The Company does not expect to adopt ASU No. 2023-09 early and is currently evaluating the impact of adopting this standard on its consolidated financial statements.
Added
The marketing promotion services are considered as a single performance obligation, as the Company’s responsibility was only limited to provide the potential car users’ information to insurance broker agencies, regardless of whether those car users finally purchasing car insurance or not. 86 Cost of goods sold Cost of revenue mainly consisted of purchase price for medical devices the Company sold such as defibrillators and anesthesia laryngoscope and including service fee incurred for the Company’s marketing promotion service business.
Removed
The Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the consolidated balance sheets, consolidated statements of operations and comprehensive loss (income) and consolidated statements of cash flows.
Added
Operating expenses Operating expenses primarily consist of sales and marketing expenses, general and administrative expenses.
Added
Impairment of goodwill and intangible assets Impairment of goodwill and intangible assets mainly consist of goodwill impairment and intangible assets impairment from acquired Tianjin Wangyi reporting unit. The Company recognized impairment loss for intangible assets of nil, nil and US$121.1 million for the years ended March 31, 2023, 2024 and 2025, respectively.
Added
For the years ended March 31, 2023, 2024 and 2025, the amount of goodwill impairment the Company recognized were nil, nil and US$41.4 million. Income Taxes The Company accounts for income taxes under ASC Topic 740, Income Taxes (“ASC 740”).
Added
Marketing promotion service Revenue from marketing promotion service was approximately US$14.4 million, increase from nil for the year ended March 31, 2024, the Company started its marketing promotion service business since April 2024, and the increase was primarily due to the growth of the scale of China’s automobile industry and the increase in demand for automobile insurance Cost of revenue Cost of revenue for the year ended March 31, 2025 were approximately US$15.1 million, representing a increase of 557.0% from approximately US$2.3 million for the year ended March 31, 2024.
Added
The increase of cost was primarily due to the increase of revenue from marketing promotion service business. Costs of medical devices Costs of revenue for sales of medical devices business was approximately US$0.4 million, which was primarily the purchase price of goods sold.
Added
The decrease of costs related to medical devices business was in line with the decrease of revenue from sale of medical devices. Costs of Marketing promotion service Cost of revenue for marketing promotion service was approximately US$14.7 million, increase from nil for the year ended March 31, 2024.
Added
The Company started its marketing promotion service business since April 2024 and the increase of costs was in line with the increase of revenue from marketing promotion service business. Gross profit Gross profit for the year ended March 31, 2025 was negative US$281,526 compared with positive US$122,132 for the year ended March 31, 2024.
Added
The changes was mainly due to negative gross profit of US$289,822 from marketing promotion business. Gross profit for Sales of medical devices The gross profit from sales of medical devices business was 12,120 for the year ended March 31, 2025, compared with that of US$122,132 in the year ended March 31, 2024.
Added
The decrease was mainly due to decrease of revenue from sales of medical devices affecting by decrease of market demand. Gross profit for Marketing promotion service business The gross profit from marketing promotion service business was negative US$289,822 for the year ended March 31, 2025, compared with that of nil in the year ended March 31, 2024.
Added
The Company started the marketing promotion service business in fiscal year 2025, and the negative gross profit was mainly due to low conversion rate as the business still in its early stage. Gross margin The gross margin was negative 1.9% in the year ended March 31, 2025, compared with positive 5.1% in the year ended March 31, 2024.
Added
The changes was mainly due to a negative 2.0% gross margin from marketing promotion business. Gross margin for Sales of medical devices The gross margin from sales of medical devices business was 2.9% for the year ended March 31, 2025, compared with that of 5.1% in the year ended March 31, 2024.
Added
The decrease was mainly due to decrease of revenue with high margin in the year ended March 31, 2025 compared with year ended March 31, 2024.
Added
Gross margin for Marketing promotion service business The gross margin from marketing promotion service business was negative 2.0% for the year ended March 31, 2025, compared with nil in the year ended March 31, 2024.
Added
The Company started the marketing promotion service business in fiscal year 2025, and the negative gross margin was mainly due to low conversion rate in its early stage resulting to a negative gross profit.
Added
Operating expenses Total operating costs and expenses for the year ended March 31, 2025 were approximately US$166.0 million, representing an increase of 1,795.2% from approximately US$8.8 million for the year ended March 31, 2024.
Added
Sales and marketing expenses Sales and marketing expenses for the year ended March 31, 2025 was nil, representing a decrease of 100.0%, or approximately US$0.2 million from approximately US$0.2 million for the year ended March 31, 2024. The Company did not incur sales and marketing expense in fiscal year 2025.
Added
The decrease was primarily attributable to i) an increase of approximately US$2.1 million amortization, and ii) offsetting by a decrease of approximately US$7.5 million in provision for doubtful account.
Added
Impairment of goodwill and intangible assets Impairment of goodwill and intangible assets increased by US$162.4 million in the year ended March 31, 2025, compared with nil for the year ended March 31, 2024. The increase was mainly due to i) an increase of US$41.4 million from goodwill impairment and ii) an increase of US$121.1 million from intangible assets impairment.
Added
All the impairment loss was related to the acquisition of Tianjin Wangyi during the year ended March 31, 2025. 89 ● Impairment on acquired patents To expand its healthcare service business, the Company acquired Tianjin Wangyi Cloud Technology Co., Ltd and its wholly owned subsidiaries (“Tianjin Wangyi” or the “acquiree”) in the fiscal year ended March 31, 2025.
Added
Tianjin Wangyi was engaged in online hospital and clinic pharmacies in China. On April 15, 2024, the Company obtained 50% equity interest of the acquiree at the consideration of US$75,000,000.
Added
Being optimistic about the development prospects and synergies of combination for online and offline medical resources, the Company acquired the remaining 50% equity of Tianjin Wangyi at the consideration of US$75,000,000. The acquisition was closed on December 10, 2024 upon the settlement of the consideration.
Added
With the completion of the acquisition, the Company acquired intangible assets amounting to US$130,654,031 in connection with the business combination, of which the value of patents and Internet Hospital License (the “License”) amounting to US$120,748,253 and US$9,905,778, respectively. The value of intangible assets was measured at fair value by the using of discounted cashflow method upon acquisition.
Added
Subsequent to the acquisition, the Company started its preparation for transforming patents into medical products and the achievement of its commercialization. In the process of reassessing the acquisition due diligence and acquiree’s information, the Company determined that sufficient indicators of potential impairment existed to require an impairment analysis for the patents acquired.
Added
The indicators included i) Post-acquisition emerging policy tightening signals introduced material uncertainty into the patent commercialization landscape, impacting the initial valuation assumptions based on prevailing market conditions and industry projections at acquisition time; ii) lower than expected revenue and profitability levels over a sustained period of time; and iii) downward revisions to management’s short-term and long-term forecast for the patent related business to be indicators of impairment for the Tianjin Wangyi’s long-lived assets.
Added
Based on the results of the recoverability test, the Company determined that the carrying value of the Tianjin Wangyi’s asset group exceeded its undiscounted cash flows and was therefore not recoverable. The Company then compared the fair value of the asset group to its carrying value and determined the impairment loss.

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Item 6. [Reserved]

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

17 edited+3 added−4 removed64 unchanged
A general notice given to the directors by any director to the effect that he is a member, shareholder, director, partner, officer or employee of any specified company or firm and is to be regarded as interested in any contract or transaction with that company or firm shall be deemed a sufficient declaration of interest for the purposes of voting on a resolution in respect to a contract or transaction in which he has an interest, and after such general notice, it shall not be necessary to give special notice relating to any particular transaction. 81 Committees of the Board of Directors We have established an audit committee, a compensation committee and a nominating and corporate governance committee under the board of directors.
A general notice given to the directors by any director to the effect that he is a member, shareholder, director, partner, officer or employee of any specified company or firm and is to be regarded as interested in any contract or transaction with that company or firm shall be deemed a sufficient declaration of interest for the purposes of voting on a resolution in respect to a contract or transaction in which he has an interest, and after such general notice, it shall not be necessary to give special notice relating to any particular transaction. 98 Committees of the Board of Directors We have established an audit committee, a compensation committee and a nominating and corporate governance committee under the board of directors.
The nominating and corporate governance committee is responsible for, among other things: ● recommending nominees to the board of directors for election or re-election to the board of directors, or for appointment to fill any vacancy on the board of directors; ● reviewing annually with the board of directors the current composition of the board of directors with regards to characteristics such as independence, age, skills, experience and availability of service to us; 82 ● selecting and recommending to the board of directors the names of directors to serve as members of the audit committee and the compensation committee, as well as of the nominating and corporate governance committee itself; and ● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.
The nominating and corporate governance committee is responsible for, among other things: ● recommending nominees to the board of directors for election or re-election to the board of directors, or for appointment to fill any vacancy on the board of directors; ● reviewing annually with the board of directors the current composition of the board of directors with regards to characteristics such as independence, age, skills, experience and availability of service to us; 99 ● selecting and recommending to the board of directors the names of directors to serve as members of the audit committee and the compensation committee, as well as of the nominating and corporate governance committee itself; and ● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.
Neal earned a Bachelor’s degree from University of Georgia in 1973. 78 Our insider trading policy allows directors, officers and other employees covered under the policy to establish, under limited circumstances contemplated by Rule 10b5-1 under the Securities Exchange Act of 1934, written programs that permit automatic trading of our stock or trading of our shares or ADSs by an independent person who is not aware of material non-public information at the time of the trade.
Neal earned a Bachelor’s degree from University of Georgia in 1973. 95 Our insider trading policy allows directors, officers and other employees covered under the policy to establish, under limited circumstances contemplated by Rule 10b5-1 under the Securities Exchange Act of 1934, written programs that permit automatic trading of our stock or trading of our shares or ADSs by an independent person who is not aware of material non-public information at the time of the trade.
In the event that any dividend or other distribution, recapitalization, share division, share consolidation, reorganization or any change in the corporate structure of the Company affecting the shares occurs, the administrators will make an adjustment with respect to the number and class of shares that may be delivered under the 2023 Equity Incentive Plan and/or the number, class and price of shares covered by outstanding awards, in order to prevent diminution of the benefits intended to be made available under the 2023 Equity Incentive Plan. 79 Awards under the Equity Incentive Plan Share Options Share options may be granted under the 2023 Equity Incentive Plan.
In the event that any dividend or other distribution, recapitalization, share division, share consolidation, reorganization or any change in the corporate structure of the Company affecting the shares occurs, the administrators will make an adjustment with respect to the number and class of shares that may be delivered under the 2023 Equity Incentive Plan and/or the number, class and price of shares covered by outstanding awards, in order to prevent diminution of the benefits intended to be made available under the 2023 Equity Incentive Plan. 96 Awards under the Equity Incentive Plan Share Options Share options may be granted under the 2023 Equity Incentive Plan.
Liu has extensive experience in financial investments, capital market operations and enterprise management. Ms. Liu obtained her bachelor’s degree in marketing from the Department of Economics and Management at Nankai University of China. Non-executive Directors Mr. Stephen P. Brown , aged 65 Mr. Stephen P. Brown has served as our independent director since April 11, 2022. Mr.
Liu has extensive experience in financial investments, capital market operations and enterprise management. Ms. Liu obtained her bachelor’s degree in marketing from the Department of Economics and Management at Nankai University of China. Non-executive Directors Mr. Stephen P. Brown , aged 66 Mr. Stephen P. Brown has served as our independent director since April 11, 2022. Mr.
From August 2009 to June 2011, he served as sales director at Henan Region of Shijiazhuang Shengdian Pharmaceutical Co., Ltd. Mr. Liu earned his bachelor’s degree in marking and business English from University of Portsmouth in 2007. Mr. Gerald (Jerry) T. Neal, aged 73, Mr. Gerald (Jerry) T. Neal has served as our independent director since June 7, 2022. Mr.
From August 2009 to June 2011, he served as sales director at Henan Region of Shijiazhuang Shengdian Pharmaceutical Co., Ltd. Mr. Liu earned his bachelor’s degree in marking and business English from University of Portsmouth in 2007. Mr. Gerald (Jerry) T. Neal, aged 74, Mr. Gerald (Jerry) T. Neal has served as our independent director since June 7, 2022. Mr.
Yilin (Linda) Wang, aged 38, has served as our chief executive officer since October 2021. From September 2021 to October 2021, Ms Wang served as the Co-CEO of the Company. Ms Wang has extensive years of experience in corporate management. She is an information technology expert and has rich professional experience in medical health, health management and medical technology-related businesses.
Yilin (Linda) Wang, aged 39, has served as our chief executive officer since October 2021. From September 2021 to October 2021, Ms Wang served as the Co-CEO of the Company. Ms Wang has extensive years of experience in corporate management. She is an information technology expert and has rich professional experience in medical health, health management and medical technology-related businesses.
Zhe Liu , aged 40, has served as our independent director since October 12, 2022. In 2012, Mr. Liu founded Shijiazhuang Zizhe Import and Export Trading Co., Ltd and served as CEO since January 2012. From June 2011 to January 2012, he served as deputy manager at Shijiazhuang Branch of Beijing Aohongxuan Wine Co., Ltd.
Zhe Liu , aged 41, has served as our independent director since October 12, 2022. In 2012, Mr. Liu founded Shijiazhuang Zizhe Import and Export Trading Co., Ltd and served as CEO since January 2012. From June 2011 to January 2012, he served as deputy manager at Shijiazhuang Branch of Beijing Aohongxuan Wine Co., Ltd.
Ms. Wenjuan (Vivian) Liu, aged 38, was appointed as our director on July 14, 2021. Ms. Liu has served as the Chief Executive Officer of Hebei Chuangjie Technology Co., Ltd. since August 2018. From May 2015 to July 2018, Ms. Liu served as the Key Client Manager of Hebei Branch of Guosen Co., Ltd. Ms.
Wenjuan (Vivian) Liu, aged 39, was appointed as our director on July 14, 2021. Ms. Liu has served as the Chief Executive Officer of Hebei Chuangjie Technology Co., Ltd. since August 2018. From May 2015 to July 2018, Ms. Liu served as the Key Client Manager of Hebei Branch of Guosen Co., Ltd. Ms.
Each executive officer has agreed to indemnify us against any actual loss incurred by us as a result of his or her breach of the confidentiality and non-competition obligations. 83 We have entered into indemnification agreements with each of our directors and executive officers.
Each executive officer has agreed to indemnify us against any actual loss incurred by us as a result of his or her breach of the confidentiality and non-competition obligations. 100 We have entered into indemnification agreements with each of our directors and executive officers.
Granted Options and Restricted Share Units As of March 31, 2024, the aggregate numbers of our ordinary shares underlying our outstanding options and restricted share units were nil and nil, respectively. For the fiscal year ended March 31, 2024, nil of the options granted had been vested, and nil of the restricted share units granted had been vested.
Granted Options and Restricted Share Units As of March 31, 2025, the aggregate numbers of our ordinary shares underlying our outstanding options and restricted share units were nil and nil, respectively. For the fiscal year ended March 31, 2025, nil of the options granted had been vested, and nil of the restricted share units granted had been vested.
Neal — — — — The following table summarizes, as of March 31, 2024 the outstanding restricted share units granted to the individual executive officers and directors named below and to other individuals as a group.
Neal - - - - The following table summarizes, as of March 31, 2025 the outstanding restricted share units granted to the individual executive officers and directors named below and to other individuals as a group.
Under these agreements, we agree to indemnify our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being a director or officer of our company. D. Employees We had 42, 12 and 9 full-time employees as of March 31, 2022, 2023 and 2024, respectively.
Under these agreements, we agree to indemnify our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being a director or officer of our company. D. Employees We had 12, 9 and 27 full-time employees as of March 31, 2023, 2024 and 2025, respectively.
As of March 31, 2024, none of the options granted had been exercised, and none of the restricted share units granted had vested. 80 The following table summarizes, as of March 31, 2024, the outstanding options granted to the individual executive officers and directors named below and to other individuals as a group.
As of March 31, 2025, none of the options granted had been exercised, and none of the restricted share units granted had vested. 97 The following table summarizes, as of March 31, 2025, the outstanding options granted to the individual executive officers and directors named below and to other individuals as a group.
Compensation For the fiscal year ended March 31, 2024, we paid an aggregate of approximately US$ 207,600 in cash to our executive officers and directors. We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our executive officers and directors.
Compensation For the fiscal year ended March 31, 2025, we paid an aggregate of approximately US$ 216,000 in cash to our executive officers and directors. We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our executive officers and directors.
Name Age Position with the Company Executive Directors and Officers: Yilin (Linda) Wang 38 Chairwoman and Chief Executive Officer Rui (Kerrie) Zhang 40 Chief Financial Officer Wenjuan (Vivian) Liu 38 Director Non-Executive Directors: Stephen P. Brown 65 Independent director Zhe Liu 40 Independent director Gerald (Jerry) T. Neal 73 Independent director 77 Executive Officers Ms.
Name Age Position with the Company Executive Directors and Officers: Yilin (Linda) Wang 39 Chairwoman and Chief Executive Officer Zhongliang Xie 54 Chief Financial Officer Wenjuan (Vivian) Liu 39 Director Non-Executive Directors: Stephen P. Brown 66 Independent director Zhe Liu 41 Independent director Gerald (Jerry) T. Neal 74 Independent director Executive Officers Ms.
Wang obtained her bachelor’s degree in management from the Hebei University of Science & Technology, China, and a master’s degree in science and engineering management from the Hebei Dizhi University, China. Ms. Rui (Kerrie) Zhang , aged 40, has served as our chief financial officer since August 2019. Ms.
Ms. Wang has been the founder and CEO of Shijiazhuang Weigou Information Technology Co., Ltd., since November 2010. Ms. Wang obtained her bachelor’s degree in management from the Hebei University of Science & Technology, China, and a master’s degree in science and engineering management from the Hebei Dizhi University, China. Mr.
Removed
Ms. Wang has served as the Director and CEO of SOS Information Technology Co., Ltd., a wholly-owned subsidiary of SOS Limited (NYSE: SOS) since March 2016, and has been the founder and CEO of Shijiazhuang Weigou Information Technology Co., Ltd., since November 2010. Ms.
Added
Zhongliang Xie , aged 54, has served as our chief financial·officer·since Aprill 2025. He has served as the General Manager of Zhongxingcai Guanghua Certified Public Accountants Shaanxi Branch since 2019.
Removed
Zhang joined the Company in 2017 where she served as our financial reporting director. From May 2016 to April 2017, Ms.
Added
He previously served as the General Manager of Beijing Xinghua Certified Public Accountants Xi’an Branch from 2008 to 2018, and as the Finance Manager of Zhongyi Far East Import & Export Co., Ltd. from 2005 to 2008. Mr. Xie has also been the signing CPA and lead audit partner for several bond issuance and annual report projects in China.
Removed
Zhang served as the strategy development director and board secretary for Shanghai AkPurna Investment Management Co., Ltd., Akcome’s fintech platform, where she was responsible for formulating and developing the company’s long-term strategy, operational planning, and providing ongoing support to the Board of Directors. From April 2011 to May 2016, Ms.
Added
In addition, he has served as the lead audit partner for the listing and annual reports of numerous companies listed on the National Equities Exchange and Quotations (NEEQ) of China. Mr. Xie is a Chinese Certified Public Accountant (CPA), Certified Asset Appraiser, Chinese Certified Cost Engineer, and a fellow of the International Association of Accountants (FAIA). Ms.
Removed
Zhang served in various departmental roles including board secretary, project investment manager, investor relations manager, and group finance manager at ReneSola Ltd. (NYSE: SOL) where she helped create and improve their corporate governance framework. Ms. Zhang received a bachelor’s degree in business administration from Northwest University for Nationalities and a master’s degree in professional accounting from the University of Sydney.

Item 7. Management's Discussion & Analysis

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

12 edited+1 added−13 removed15 unchanged
None of our existing shareholders will have different voting rights from other shareholders, except with respect to the differences in voting rights afforded to holders of Class A ordinary shares and Class B ordinary shares. We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. 85 B.
None of our existing shareholders will have different voting rights from other shareholders, except with respect to the differences in voting rights afforded to holders of Class A ordinary shares and Class B ordinary shares. We are not aware of any arrangement that may, at a subsequent date, result in a change of control of our company. B.
Memorandum and Articles of Association—Ordinary Shares.” (4) Ms. Yilin (Linda) Wang does not hold any ordinary share in our company. (5) The business address of Mr. Stephen P. Brown is 9 Bent Oak Coto de Caza, CA 92679. (6) The business address of Mr.
Memorandum and Articles of Association-Ordinary Shares.” 102 (4) Ms. Yilin (Linda) Wang does not hold any ordinary share in our company. (5) The business address of Mr. Stephen P. Brown is 9 Bent Oak Coto de Caza, CA 92679. (6) The business address of Mr.
Neal (7) — — — — — Rui (Kerrie) Zhang * — — — — Wenjuan (Vivian) Liu — — — — — All directors and executive officers as a group * — — — — Principal Shareholders: Webao Limited (8) — 7,980,800 7,980,800 1.1 18.3 Notes: * Less than 1% of our total outstanding ordinary shares.
Neal (7) - - - - - Rui (Kerrie) Zhang * - - - - Wenjuan (Vivian) Liu - - - - - All directors and executive officers as a group * - - - - Principal Shareholders: Webao Limited (8) - 7,980,800 7,980,800 0.5 8.8 Notes: * Less than 1% of our total outstanding ordinary shares.
Related Party Transactions Contractual Arrangements and Corporate Structure Akso Health Group, formerly known as Xiaobai Maimai Inc., is a limited company incorporated under the laws of the Cayman Islands and currently conducts substantially all of our business operations in the PRC through our wholly foreign owned entities (“WFOEs”) incorporated in the PRC and certain business operations through the PRC consolidated variable interest entity (“VIE”).
Related Party Transactions Contractual Arrangements and Corporate Structure Akso Health Group, formerly known as Xiaobai Maimai Inc., is a limited company incorporated under the laws of the Cayman Islands and currently conducts substantially all of our business operations in the PRC through our wholly foreign owned entities (“WFOEs”) incorporated in the PRC.
(2) For each person and group included in this column, percentage ownership is calculated by dividing the number of Class A and Class B ordinary shares beneficially owned by such person or group by the sum of the total number of Class A and Class B ordinary shares outstanding, which is 722,595,220 ordinary shares (including 714,614,420 Class A ordinary shares and 7,980,800 Class B ordinary shares) as of the date of this annual report, plus the number of Class A and Class B ordinary shares such person or group has the right to acquire upon the exercise of options, warrants or other rights within 60 days after as of the date of this annual report.
(2) For each person and group included in this column, percentage ownership is calculated by dividing the number of Class A and Class B ordinary shares beneficially owned by such person or group by the sum of the total number of Class A and Class B ordinary shares outstanding, which is 1,655,583,530 ordinary shares (including 1,647,602,730 Class A ordinary shares and 7,980,800 Class B ordinary shares) as of the date of this annual report, plus the number of Class A and Class B ordinary shares such person or group has the right to acquire upon the exercise of options, warrants or other rights within 60 days after as of the date of this annual report.
As used in this annual report, unless otherwise indicated, “we,” “us,” “our,” the “Company” and “Akso Health” refer to Akso Health Group, a company organized in the Cayman Islands; “we,” “us,” “our,” “our company,” the “Company” or similar terms refer to Cayman Islands and/or its consolidated subsidiaries, other than the variable interest entity, Beijing Hexin Yongheng Technology Development Co., Ltd., a PRC company, and its subsidiaries, unless the context otherwise indicates; and the “VIE” refers respectively to the variable interest entity and its subsidiaries, Wusu Hexin Yongheng Trading Co., Ltd , Hexin Digital Technology Co., Ltd. and Beijing Hexin Jiuding Technology Co., Ltd.
As used in this annual report, unless otherwise indicated, “we,” “us,” “our,” the “Company” and “Akso Health” refer to Akso Health Group, a company organized in the Cayman Islands; and the “VIE” refers respectively to our former variable interest entity and its subsidiaries, Wusu Hexin Yongheng Trading Co., Ltd , Hexin Digital Technology Co., Ltd. and Beijing Hexin Jiuding Technology Co., Ltd.
The calculations in the table below assume there are 722,595,220 ordinary shares (including 714,614,420 Class A ordinary shares and 7,980,800 Class B ordinary shares) outstanding as of the date of this annual report. Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
The calculations in the table below assume there are 1,655,583,530 ordinary shares (including 1,647,602,730 Class A ordinary shares and 7,980,800 Class B ordinary shares) outstanding as of the date of this annual report. 101 Beneficial ownership is determined in accordance with the rules and regulations of the SEC.
These ordinary shares, however, are not included in the computation of the percentage ownership of any other person. 84 Ordinary shares beneficially owned Class A ordinary shares Class B ordinary shares Total ordinary shares on as-converted basis % of total ordinary shares on as-converted basis (2) % of aggregate voting power(3) Directors and Executive Officers (1): Yilin (Linda) Wang (4) — — — — — Stephen P.
Ordinary shares beneficially owned Class A ordinary shares Class B ordinary shares Total ordinary shares on as-converted basis % of total ordinary shares on as-converted basis (2) % of aggregate voting power(3) Directors and Executive Officers (1): Yilin (Linda) Wang (4) - - - - - Stephen P.
The VIE structure is used to provide investors with contractual exposure to foreign investment in China-based companies where Chinese law prohibits or restricts direct foreign investment in the operating companies.
The VIE structure was used to provide investors with contractual exposure to foreign investment in China-based companies where Chinese law prohibits or restricts direct foreign investment in the operating companies. 103 As of May 2023, the Company disposed its social E-commerce business.
Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees—C. Board Practices—Employment Agreements and Confidentiality Agreements.” Share Incentive Plans See “Item 6. Directors, Senior Management and Employees—B. Compensation—Share Incentive Plan.” C. Interests of Experts and Counsel Not applicable. 87
As of March 31, 2025, the balance of amount due to related parties was US$2.0 million. Employment Agreements and Indemnification Agreements See “Item 6. Directors, Senior Management and Employees-C. Board Practices-Employment Agreements and Confidentiality Agreements.” Share Incentive Plans See “Item 6. Directors, Senior Management and Employees-B. Compensation-Share Incentive Plan.” C. Interests of Experts and Counsel Not applicable. 104
The loan term is 1 year. In August 2022, the loan was extended one year to August 27, 2023. In August 2023, the loan was extended one more year to August 27,2024. As of March 31, 2024, the balance of amount due to related parties was US$2.0 million.
The loan term is 1 year. In August 2022, the loan was extended one year to August 27, 2023. In August 2023, the loan was extended one more year to August 27,2024. In August 2024, the loan was extended one more year to August 26, 2025.
As a result, investors in the Company’s ADSs are not purchasing an equity interest in the VIE or its subsidiaries but instead are purchasing an equity interest in the Company, the Cayman Islands holding company. The Diagram below shows our corporate structure as of the date of March 31, 2023, including the WFOEs, the VIE and its subsidiaries.
The Diagram below shows our corporate structure as of the date of March 31, 2023, including the WFOEs, our former VIE and its subsidiaries. At the time, the Company conducted operations in China primarily through WFOEs and its subsidiaries in China, including the former VIE. As a result, the Company did not conduct any business on its own.
Removed
Due to PRC legal restrictions on foreign ownership and investment in the value-added telecommunications market, we rely on a series of contractual arrangements among the VIE and its shareholders to operate our online and mobile platforms in China.
Added
These ordinary shares, however, are not included in the computation of the percentage ownership of any other person.
Removed
These contractual arrangements entered into with the VIE allow us to (i) exercise effective control over the VIE, (ii) receive substantially all of the economic benefits of the VIE, and (iii) have an exclusive option to purchase all or part of the equity interests in the VIE when and to the extent permitted by PRC law.
Removed
These contractual arrangements include an exclusive business cooperation agreement, exclusive option agreement, equity interest pledge agreement, and a power of attorney. As a result of these contractual arrangements, we exert effective control over, and are considered the primary beneficiary of, the VIE and consolidate its operating results in our financial statements under U.S. GAAP.
Removed
As a result of such series of contractual arrangements, the Company and its subsidiaries become the primary beneficiary of the VIE for accounting purposes and the VIE is deemed as a PRC consolidated entity under U.S. GAAP. We consolidate the financial results of the VIE and its subsidiaries in our consolidated financial statements in accordance with U.S. GAAP.
Removed
Neither we nor the Company’s investors own any equity ownership in, direct foreign investment in, or control through such ownership/investment of the VIE. These contractual arrangements have not been tested in a court of law in the PRC.
Removed
However, investors are cautioned that the enforceability of such VIE Agreements has not been tested in a court of law. The Company conducts operations in China primarily through WFOEs and its subsidiaries in China, including the VIE. As a result, the Company does not conduct any business on its own.
Removed
Due to PRC legal restrictions on foreign ownership in internet-based businesses, we do not have any equity ownership of the VIE, instead we receive the economic benefits of the VIE’s business operations through certain contractual arrangements.
Removed
As a result of such series of contractual arrangements, the Company and its subsidiaries become the primary beneficiary of the VIE for accounting purposes and the VIE as a PRC consolidated entity under U.S. GAAP. We consolidate the financial results of the VIE and its subsidiaries in our consolidated financial statements in accordance with U.S. GAAP.
Removed
Neither we nor the Company’s investors own any equity ownership in, direct foreign investment in, or control through such ownership/investment of the VIE. Investors are purchasing an interest in the Company, the Cayman holding company. 86 As of May 2023, the Company disposed its social E-commerce business.
Removed
On January 24, 2022, the Company entered into a loan agreement with SOS Information Technology New York, Inc. (“SOS NY”), one of our senior managements has served as the Director and CEO of SOS Information Technology Co., Ltd., a wholly-owned subsidiary of SOS Limited (NYSE: SOS) since March 2016, for a loan of US$35,200,000 with a 2% annual interest rate.
Removed
The loan term was 1 year. For the fiscal year ended March 31, 2022, interest expense pertaining to the loan amounted to US$127,244.
Removed
On July 27, 2022, the Company and SOS NY entered into an amendment and supplemental agreement to the loan agreement, pursuant to which the Company shall make a repayment in advance to SOS NY of US$27,513,849 of the principal amount together with all accrued but unpaid interest of US$358,751.
Removed
The Company made a payment of US$27,872,600 for the above principal and interest on July 28, 2022. In November 2023, the Company made a payment of US$7,686,151 of principal amount together with all accrued but unpaid interest of US$196,681 to SOS NY. As of March 31, 2024, the outstanding balance of unpaid principal and interest was nil and nil, respectively.

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