Company: XHG
Filing Date: 2025-09-09
Form Type: F-3
Source: 0001213900-25-086186
Chunk: 47

Company: XChange TEC.INC
Filing Date: 2025-09-09
Form: F-3
Chunk 47
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. However, since PRC administrative and court authorities have significant discretion
in interpreting and implementing statutory and contractual terms, it may be more difficult to evaluate the outcome of administrative and
court proceedings and the level of legal protection we enjoy than in more developed legal systems. Furthermore, the PRC legal system is
based in part on government policies and internal rules (some of which are not published in a timely manner or at all) that may have retroactive
effect. As a result, we may not be aware of our violation of these policies and rules in a timely manner until sometime after the violation.

Such uncertainties, including uncertainty over
the scope and effect of our contractual, property (including intellectual property) and procedural rights, could materially and adversely
affect our business and impede our ability to continue our operations.

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If the U.S. Public Company Accounting Oversight Board, or the PCAOB, is unable to inspect our auditors as required under the Holding Foreign Companies Accountable Act, the SEC will prohibit the trading of our ADSs. A trading prohibition for our ADSs, or the threat of a trading prohibition, may materially and adversely affect the value of your investment. Additionally, the inability of the PCAOB to conduct inspections of our auditors would deprive our investors of the benefits of such inspections.

The U.S. Holding Foreign Companies Accountable
Act, or the HFCA Act, was enacted into law on December 18, 2020. Under the HFCA Act, if the SEC determines that we have filed audit reports
issued by a registered public accounting firm that has not been subject to inspection by the PCAOB for three consecutive years, the SEC
will prohibit our securities, including our ADSs, from being traded on a U.S. national securities exchange, including NASDAQ, or in the
over-the-counter trading market in the U.S. The process for implementing trading prohibitions pursuant to the HFCA Acts will be based
on a list of registered public accounting firms that the PCAOB has been unable to inspect and investigate completely as a result of a
position taken by a non-U.S. government, or the Relevant Jurisdiction, and such identified auditors, the PCAOB Identified Firms. The first
list of PCAOB Identified Firms was included in a release by the PCAOB on December 16, 2021, or the PCAOB December 2021 Release. The SEC
will review annual reports filed with it for fiscal years beginning after