Company: XHG
Filing Date: 2025-01-22
Form Type: 20-F
Source: 0001213900-25-005499
Chunk: 120

Company: XChange TEC.INC
Filing Date: 2025-01-22
Form: 20-F
Item: Item 5
Chunk 120
---
 of Alpha Mind may exercise their collateral rights. We will lose control of and no longer be able to consolidate
Alpha Mind and our business, financial condition, results of operations and prospects will be adversely affected. For details of the risks
related to the Notes, see “ Item 3. Key Information - D. Risk Factors - Risks Related to our Business and Industry - 
If we are unable to repay or refinance the Notes, we will lose control and will no longer be able to consolidate the results of operation
of Alpha Mind. In addition, our level of indebtedness could adversely affect our business, financial condition, results of operations
and prospects.”

In addition to repaying the Notes, our material
cash requirements as of September 30, 2024 and any subsequent interim period primarily include expenditure of daily operation, including
marketing activities. We intend to meet the cash requirements for the next 12 months through a combination of short-term loan from certain
third parties or related parties, issuance of ordinary shares or other equity-linked securities. In addition, with the acquisition of
Alpha Mind on December 28, 2023, we will also utilize the cash generated from Alpha Mind’s business operations.

These plans and initiatives cannot alleviate
the substantial doubt of our ability to continue as a going concern. There can be no assurance that we will be successful in achieving
our strategic plans, that our future capital raises will be sufficient to support our ongoing operations, or that any additional financing
will be available in a timely manner or with acceptable terms, if at all. If we are unable to raise sufficient financing or events or
circumstances occur such that we do not meet our strategic plans, we will be required to reduce certain discretionary spending, or be
unable to fund capital expenditures, which would have a material adverse effect on our financial position, results of operations, cash
flows, and ability to achieve our intended business objectives.

However, future financing requirements will depend
on many factors, including the scale and pace of the expansion of our insurance agency network, efficiency in our services and SaaS platform,
the expansion of our sales and marketing activities, and potential investments in, or acquisitions of, businesses or technologies. Inability
to access financing on favorable terms in a timely manner or at all would materially and adversely affect our business, results of operations,
financial condition, and growth prospects.

The consolidated financial statements included
in this annual report do not include any adjustments that might result from the outcome of this uncertainty. Accordingly, the consolidated