# EDGAR Filing Document

**Accession Number:** 0001829667
**File Stem:** 0001213900-25-104686
**Filing Date:** 2025-10
**Character Count:** 715954
**Document Hash:** 6d3579a732f0e5ae950df2b0858ba902
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-25-104686.hdr.sgml**: 20251031

**ACCESSION NUMBER**: 0001213900-25-104686

**CONFORMED SUBMISSION TYPE**: 20-F

**PUBLIC DOCUMENT COUNT**: 74

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20251031

**DATE AS OF CHANGE**: 20251031

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Regencell Bioscience Holdings Ltd
- **CENTRAL INDEX KEY:** 0001829667
- **STANDARD INDUSTRIAL CLASSIFICATION:** MEDICINAL CHEMICALS & BOTANICAL PRODUCTS [2833]
- **ORGANIZATION NAME:** 03 Life Sciences
- **EIN:** 000000000
- **STATE OF INCORPORATION:** E9

**FILING VALUES:**
- **FORM TYPE:** 20-F
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-40617
- **FILM NUMBER:** 251440744

**BUSINESS ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 11/F FIRST COMMERCIAL BUILDING
- **STREET 2:** 33-35 LEIGHTON ROAD, CAUSEWAY BAY
- **CITY:** HONG KONG
- **PROVINCE COUNTRY:** F4
- **BUSINESS PHONE:** 852 2155 0823

**MAIL ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 11/F FIRST COMMERCIAL BUILDING
- **STREET 2:** 33-35 LEIGHTON ROAD, CAUSEWAY BAY
- **CITY:** HONG KONG
- **PROVINCE COUNTRY:** F4

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM 20-F**

☐ **REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934**

**OR**

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

**For the fiscal year ended June 30, 2025**

**OR**

☐ **TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

**For the transition period from ____________to ____________**

**OR**

☐ **SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

Date of event requiring this shell company report

**Commission file number: 001-40617**

**REGENCELL BIOSCIENCE HOLDINGS LIMITED**

**(Exact Name of Registrant as Specified in its Charter)**

**N/A** 

(Translation of Registrant's Name into English)

**Cayman Islands**

(Jurisdiction of Incorporation or Organization)

**9/F Chinachem Leighton Plaza**

**29 Leighton Road**

**Causeway Bay, Hong Kong**

**Tel: 852 2155 0823**

(Address of principal executive offices)

**Yat-Gai Au**

**Chief Executive Officer**

**9/F Chinachem Leighton Plaza**

**29 Leighton Road**

**Causeway Bay, Hong Kong**

**Tel: 852 2155 0823**

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

**Securities registered or to be registered pursuant to Section 12(b) of the Act:**

---

| | | |
|:---|:---|:---|
| **Title of Each Class** | **Trading Symbol** | **Name of Each Exchange on Which Registered** |
| **Ordinary shares, par value $0.00001** | **RGC** | **The Nasdaq Stock Market LLC** |

---

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

**None**

**(Title of Class)**

**Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:**

**None**

**(Title of Class)**

Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report:

As of June 30, 2025, the issuer had 494,488,908 ordinary shares issued and outstanding.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes ☐ No ☒

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of "large accelerated filer," accelerated filer," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated filer ☒ Emerging growth company ☒

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

† The term "new or
 revised financial accounting standard" refers to any update issued by the Financial Accounting Standards Board to its Accounting
 Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☐ No ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP ☒ International Financial Reporting Standards as issued by the International Accounting Standards Board ☐ Other ☐

\* If "Other" has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. Item 17 ☐ Item 18 ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ☐ No ☐

**TABLE OF CONTENTS**

 

---

| | | |
|:---|:---|:---|
| [INTRODUCTION](#a_001) | [INTRODUCTION](#a_001) | ii |
| [PART I](#a_002) | [PART I](#a_002) |  |
| ITEM 1. | [IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS](#a_003) | 1 |
| ITEM 2. | [OFFER STATISTICS AND EXPECTED TIMETABLE](#a_004) | 1 |
| ITEM 3. | [KEY INFORMATION](#a_005) | 1 |
| ITEM 4. | [INFORMATION ON THE COMPANY](#a_006) | 31 |
| ITEM 4A. | [UNRESOLVED STAFF COMMENTS](#a_007) | 54 |
| ITEM 5. | [OPERATING AND FINANCIAL REVIEW AND PROSPECTS](#a_008) | 55 |
| ITEM 6. | [DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES](#a_009) | 65 |
| ITEM 7. | [MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS](#a_010) | 74 |
| ITEM 8. | [FINANCIAL INFORMATION](#a_011) | 77 |
| ITEM 9. | [THE OFFER AND LISTING](#a_012) | 78 |
| ITEM 10. | [ADDITIONAL INFORMATION](#a_013) | 78 |
| ITEM 11. | [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](#a_014) | 104 |
| ITEM 12. | [DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES](#a_015) | 104 |
| [PART II](#a_016) | [PART II](#a_016) |  |
| ITEM 13. | [DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES](#a_017) | 105 |
| ITEM 14. | [MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS](#a_018) | 105 |
| ITEM 15. | [CONTROLS AND PROCEDURES](#a_019) | 105 |
| ITEM 16A. | [AUDIT COMMITTEE FINANCIAL EXPERT](#a_020) | 107 |
| ITEM 16B. | [CODE OF ETHICS](#a_021) | 107 |
| ITEM 16C. | [PRINCIPAL ACCOUNTANT FEES AND SERVICES](#a_022) | 107 |
| ITEM 16D. | [EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES](#a_023) | 108 |
| ITEM 16E. | [PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS](#a_024) | 108 |
| ITEM 16F. | [CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT](#a_025) | 108 |
| ITEM 16G. | [CORPORATE GOVERNANCE](#a_026) | 108 |
| ITEM 16H. | [MINE SAFETY DISCLOSURE](#a_027) | 108 |
| ITEM 16I. | [DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS](#a_028) | 108 |
| ITEM 16J. | [INSIDER TRADING POLICIES](#a_029) | 108 |
| ITEM 16K. | [CYBERSECURITY](#a_030) | 109 |
| [PART III](#a_031) | [PART III](#a_031) |  |
| ITEM 17. | [FINANCIAL STATEMENTS](#a_032) | 110 |
| ITEM 18. | [FINANCIAL STATEMENTS](#a_033) | 110 |
| ITEM 19. | [EXHIBITS](#a_034) | 110 |
| [SIGNATURES](#a_035) |  | 112 |

---

i

**INTRODUCTION**

Unless otherwise indicated, numerical figures included in this Annual Report on Form 20-F (the "Annual Report") have been subject to rounding adjustments. Accordingly, numerical figures shown as totals in various tables may not be arithmetic aggregations of the figures that precede them.

For the sake of clarity, this Annual Report follows the English naming convention of first name followed by last name, regardless of whether an individual's name is Chinese or English. Certain market data and other statistical information contained in this Annual Report are based on information from independent industry organizations, publications, surveys and forecasts. Some market data and statistical information contained in this Annual Report are also based on management's estimates and calculations, which are derived from our review and interpretation of the independent sources listed above. While we believe such information is reliable, we have not independently verified any third-party information and our internal data has not been verified by any independent source.

Unless otherwise indicated or the context requires otherwise, references in this Annual Report to:

● "China" or the "PRC" are to the People's Republic of China, excluding Taiwan and the special administrative regions of Hong Kong and Macau for the purposes of this Annual Report only;

● "Hong Kong" is to the Hong Kong Special Administrative Region of the People's Republic of China for the purposes of this Annual Report only;

● "HK$" or "Hong Kong dollar" refers to the legal currency of Hong Kong;

● "Regencell Bioscience Holdings Limited" or "Regencell" is to Regencell Bioscience Holdings Limited, a Cayman Islands exempted company incorporated under the laws of the Cayman Islands;

● "Regencell Bioscience Limited" is to Regencell Bioscience Limited, a Hong Kong limited liability company organized under the laws of Hong Kong and a wholly-owned subsidiary of Regencell Bioscience Holdings Limited;

● "Regencell Bioscience North America Limited" is to Regencell Bioscience North America Limited, a company incorporated in the British Virgin Islands and a wholly-owned subsidiary of Regencell Bioscience Holdings Limited;

● "Regencell (BVI) Limited" is to Regencell (BVI) Limited, a British Virgin Islands business company organized under the laws of British Virgin Islands;

● "Regencell Limited" is to Regencell Limited, a Hong Kong limited liability company organized under the laws of Hong Kong and a wholly-owned subsidiary of Regencell Bioscience Holdings Limited;

● "Shares," "shares" or "Ordinary Shares" are to the ordinary shares of Regencell Bioscience Holdings, Limited par value $0.00001 per share;

● "TCM" refers to Traditional Chinese Medicine;

● "The TCM Practitioner" or "our TCM Practitioner" refers to our strategic TCM research partner, Mr. Sik-Kee Au, father of our Chief Executive Officer ("CEO") and director;

● "US$," "$" or "US dollar" refers to the legal currency of the United States; and

● "We", "us", "RGC", the "Company", "our company" or the "Group" are to one or more of Regencell Bioscience Holdings Limited and its affiliated entities.

We listed our Ordinary Shares on the Nasdaq Capital Market under the symbol "RGC" on July 16, 2021.

On June 13, 2025, we, as an exempted company with limited liability incorporated under the laws of the Cayman Islands, capitalized an amount standing to the credit of the share premium account of the Company, and appropriated such sum and applied it on behalf of the shareholders towards paying in full (as to the full par value of $0.00001 per Ordinary Share) an aggregate of 481,476,042 Ordinary Shares (representing the receipt by each shareholder of the Company of 37 additional Ordinary Shares for every Ordinary Share held on the record date). This did not result in any changes in authorized share capital or par value of our Ordinary Shares, nor involve any cash outflow. This is treated as an equity reclassification of a 38-for-1 forward stock split (the "38-for-1 forward stock split") under accounting principles generally accepted in the United States of America ("U.S. GAAP")*.* The authorized share capital remained as $1,000,000 divided into 100,000,000,000 Ordinary Shares of $0.00001 par value each.

All the share numbers, option numbers and option exercise prices appearing in this Annual Report have been adjusted to give retroactive effect to the 38-for-1 forward stock split, unless otherwise indicated or unless the context suggests otherwise.

ii

**Part I**

**Item 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS**

Not Applicable.

**Item 2. OFFER STATISTICS AND EXPECTED TIMETABLE**

Not Applicable.

**Item 3. KEY INFORMATION**

A. <u>Reserved</u>

B. <u>Capitalization and Indebtedness</u>

Not applicable.

C. <u>Reasons for the Offer and Use of Proceeds</u>

Not applicable.

D. <u>Risk Factors</u>

*You should carefully consider the following risk factors, together with all of the other information included in this Annual Report. Investment in our securities involves a high degree of risk. You should carefully consider the risks described below together with all of the other information included in this Annual Report before making an investment decision. The risks and uncertainties described below represent our known material risks to our business. If any of the following risks actually occurs, our business, financial condition or results of operations could suffer. In that case, you may lose all or part of your investment.*

**Risks Related to Our Financial Position and Need for Capital**

***We are an early***-***stage TCM bioscience company with a limited operating history. We expect to incur additional losses in the future.***

We are an early-stage TCM bioscience company with a limited operating history that focuses on the research, development and commercialization of TCM for the treatment of neurocognitive disorders and degenerations, specifically Attention Deficit Hyperactivity Disorder ("ADHD") and Autism Spectrum Disorder ("ASD") with no currently approved products. To date, we have focused almost exclusively on developing our product candidates. We have funded our operations to date primarily through proceeds from our initial public offering of our Ordinary Shares. We have no saleable products and have not generated any revenue from product sales. We have incurred operating losses since our formation. We incurred total net losses of $3.58 million and $4.36 million, respectively, for the fiscal years ended June 30, 2025 and 2024. Substantially all of our operating losses resulted from costs incurred in connection with our development programs and from general and administrative costs. We expect to continue to incur research and development expenses in the future as we continue the advancement of our efficacy trials and as we potentially pursue additional indications. We may also incur expenses in connection with third-party trials involving our TCM formula or other intellectual property. In addition, if we obtain marketing approval for any of our TCM formula, we may initially incur significant outsourced sales, marketing and manufacturing expenses, as well as continued research and development expenses. As a result, we expect to continue to incur increasing operating losses for the foreseeable future.

The likelihood of success of our business plan and growth strategy must be considered in light of the problems, substantial expenses, difficulties, complications and delays frequently encountered in connection with developing and expanding early-stage businesses and the regulatory and competitive environment in which we operate.

Accordingly, you should consider our annual report in light of the costs, uncertainties, delays and difficulties frequently encountered by companies in the early stages of development, especially early-stage bioscience research companies such as ours. Potential investors should carefully consider the risks and uncertainties that a company with a limited operating history, like us, will face. In particular, potential investors should consider that we cannot assure you that we will be able to, among other things:

● successfully implement or execute our current business plan, and we cannot assure you that our business plan is sound;

● successfully manufacture and commercialize our standardized liquid-based TCM formula treatment for ADHD and ASD patients;

● successfully complete the research studies to obtain regulatory approval for the marketing of our TCM formula;

● obtain, secure, maintain and, as necessary, defend our intellectual property rights;

● attract and retain an experienced management and research team;

● launch commercial sales of our standardized liquid-based TCM formula, whether alone or in collaboration with others;

● raise sufficient funds in the capital markets or otherwise to effectuate our business plan; and

● utilize the funds that we do have and/or raise in the future to efficiently execute our business strategy.

If we cannot successfully execute any one of the foregoing, our business may fail and your investment will be adversely affected.

***We have not generated revenue from any TCM formula or applied for any regulatory approvals, nor have distribution capabilities or experience or any granted patents or pending patent applications and may never be profitable.***

Our ability to become profitable depends upon our ability to generate revenue. As of the date of this Annual Report, we have not applied for any regulatory approvals, we have no granted or pending patent applications and we have no distribution capabilities or experience, and we have not generated any revenue from our development stage TCM formula and we do not know when, or if, we will generate any such revenue. We do not expect to generate significant revenue unless and until we obtain regulatory approval of our standardized TCM formula, produce and commercialize products based on such TCM formula. Our ability to generate future revenue from sales of products based on our TCM formula depends heavily on our success in many areas, including but not limited to:

● obtaining favorable results from and progressing the research studies of our TCM formula;

● developing and obtaining regulatory approval for registration for our TCM formula;

● accurately identifying demand for our product candidates;

● continued consumer interest in treatments to the symptoms of ADHD and ASD;

● obtaining market acceptance of our liquid-based TCM formula treatment, if approved for marketing, as viable treatment options for ADHD and ASD;

● negotiating favorable terms in any collaboration, licensing or other arrangements into which we may enter; and

● recruiting and retaining qualified personnel.

 ****

***We have limited sources of working capital and may need substantial additional financing. If we are unable to obtain the required additional capital, we may have to curtail our growth plans or cut back on existing business, which may affect our results of operations and financial condition or cause the cease of our operations.***

The working capital required to implement our business plan will most likely be provided by funds obtained through offerings of our equity, debt, debt-linked securities, and/or equity-linked securities, and, in the future, revenues generated by us after our TCM formula is approved for marketing and production. Any additional capital raised through the sale of equity or equity-linked securities may dilute our current shareholders' ownership in us and could also result in a decrease in the market price of our Ordinary Shares. The terms of the securities issued by us in future capital transactions may be more favorable to new investors and may include the issuance of warrants or other derivative securities, which may have a further dilutive effect. We may incur substantial offering expenses in pursuing future external financing. We may also be required to recognize non-cash expenses in connection with certain securities we issue, such as convertible notes and warrants, which may adversely impact our financial condition and results of operations. In addition, any debt or equity financing that we may need may not be available on terms favorable to us, or at all. If we obtain funding through a strategic collaboration or licensing arrangement, we may be required to relinquish our rights to certain of our technologies, products or marketing territories. No assurance can be given that we will have sufficient revenue to sustain our operations or that we would be able to obtain external financings.

Our ability to complete additional financing is dependent on, among other things, the state of the capital markets at the time of any proposed offering, market reception of our company and the likelihood of the success of our business model and offering terms. There is no assurance that we will be able to obtain any such additional capital through asset sales, equity or debt financing, or any combination thereof, on satisfactory terms or at all. Additionally, no assurance can be given that any such financing, if obtained, will be adequate to meet our capital needs and to support our operations. If we do not obtain adequate capital on a timely basis and on satisfactory terms, we may need to delay the completion of or significantly reduce the scope of our current business plan; delay some of our research and development; or postpone the hiring of new personnel, which may affect our results of operations and financial condition. The value of our Ordinary Shares and any Ordinary Share equivalents would be materially negatively impacted, and under certain financial circumstances, we may need to curtail or cease our operations.

**Risks Related to Our Product Development, Regulatory Approval, Manufacturing and Commercialization**

***Our standardized TCM formula for ADHD and ASD patients is still in development. If we are unable to obtain regulatory approval or ultimately commercialize our standardized TCM formula and/or products based on our TCM formula, or if we experience significant delays in doing so, our business, financial condition, results of operations and prospects will be materially and adversely affected.***

Currently, our standardized TCM formula for ADHD and ASD patients are under research and development. None of the formula is currently in the process of regulatory approval and commercialization. Our ability to generate revenues from our standardized TCM formula is dependent on the completion of our research and development, receipt of regulatory approval and successfully commercializing products based on such formula, which may never occur. Our TCM formula will require additional research and development, regulatory approval in Hong Kong and other jurisdictions where we plan to sell, development of manufacturing supply and capacity, substantial investment, and significant marketing efforts before we generate any revenue from product sales. The success of our standardized TCM formula will depend on several factors, including the following:

● successful enrollment in, and completion of, research studies;

● receipt of regulatory approvals from applicable regulatory authorities for planned research studies, future research studies, or drug registrations, manufacturing and commercialization;

● successful completion of all safety studies required to obtain regulatory approval in Hong Kong and other jurisdictions in which our standardized TCM formula intend to sell;

● developing commercial manufacturing capabilities to the specifications for our candidates for clinical supply and commercial manufacturing;

● making and maintaining arrangements with third-party TCM raw material suppliers or manufacturers;

● obtaining and maintaining patent, trade secret and other intellectual property protection and/or regulatory exclusivity for our standardized TCM formula;

● launching commercial sales of our standardized liquid-based TCM formula treatment, if and when approved, whether alone or in collaboration with others;

● acceptance of the standardized liquid-based TCM formula treatment, if and when approved, by patients and the medical community;

● effectively competing with other therapies and alternative drugs, particularly those for ADHD and ASD;

● successfully enforcing and defending intellectual property rights and claims; and

● maintaining a continued acceptable safety profile of the standardized TCM formula following regulatory approval.

The success of our business is highly dependent upon our ability to develop and commercialize our standardized TCM formula for ADHD and ASD, of which research studies are currently on-going. As a result, our business is substantially dependent on our ability to complete the research and development of, obtain regulatory approval for, and successfully commercialize our standardized liquid-based TCM formula treatment and other TCM formula candidate for ADHD and ASD patients in a timely manner.

We cannot commercialize standardized TCM formula in Hong Kong, where we intend to launch our first standardized TCM formula and products, without first obtaining regulatory approval from authorities concerned in Hong Kong. The process to develop, obtain regulatory approval for and commercialize standardized TCM formula is long, complex and costly and approval may not be granted. Obtaining regulatory approval in one jurisdiction does not mean that regulatory approval will be obtained in any other jurisdiction. Approval processes vary among countries and can involve additional product testing and validation and additional administrative review periods. No assurance can be given that we can obtain regulatory approval in Hong Kong, even if our TCM formula candidate obtain approval from the Hong Kong Chinese Medicines Board. We would still need to seek approval in other jurisdictions where we plan to market the product. Any safety issues, product recalls, or other incidents related to products approved and marketed in one jurisdiction may impact the approval of those products by another jurisdiction. If we are unable to obtain regulatory approval for our standardized TCM formula candidates in one or more jurisdictions, or any approval contains significant limitations imposed on certain standardized TCM formula candidates, we may not be able to obtain sufficient funding or generate sufficient revenue to continue the development of our TCM formula candidates or any other TCM formula candidates that we may acquire or develop in the future.

***Our research and development of TCM formula candidates is at an early stage of development and all of our TCM formula candidates may require significant interactions with regulatory authorities and investments before their respective commercial launches. If we are unable to advance our TCM formula candidates to final development, meet regulatory requirements, including obtaining regulatory approval, where applicable, or ultimately commercialize our products or experience significant delays in doing so, our business will be materially harmed.***

Our research and development of TCM formula is at an early stage and will require significant investment and regulatory approvals prior to commercialization. Each of our TCM formula candidates will require additional research and development, obtaining regulatory approval, such as obtaining manufacturing supply, substantial investment and significant marketing efforts before it generates any revenue from product sales. We are not permitted to market or promote any of our standardized TCM formula candidates before our receipt of regulatory approval from the Hong Kong Chinese Medicines Board, or comparable regulatory authorities, and we may never receive such regulatory approval for any such standardized TCM formula candidates.

The success of our product candidates will depend on several factors, including but not limited to the following:

● receipt of regulatory approvals from applicable regulatory authorities for drug product candidates or, alternatively, compliance with regulatory requirements applicable to non-drug products;

● establishing current Good Manufacturing Practices ("GMP") compliant supply and commercial manufacturing operations or deciding with GMP-compliant third-party manufacturers for supply and commercial manufacturing;

● obtaining and maintaining patent and trade secret protection or regulatory exclusivity for our product candidates;

● launching commercial sales of our product, if and when approved or allowed for marketing, whether alone or in collaboration with others; and

● maintaining a continued acceptable safety profile of the product candidates following approval or commercialization.

We cannot be certain that research and development of any of our TCM formula candidate will be successful or that we will obtain regulatory approval or be able to successfully commercialize any product based on our TCM formula and generate revenue. Success in our research studies does not ensure that application of regulatory approval will be successful. Our research studies may fail to demonstrate that our TCM formula candidates are safe and effective for their proposed uses. Any such failure could cause us to abandon further development of any one or more of our TCM formula candidate and may delay development of other TCM formula candidate. Any delay in, or termination of, our development will delay and possibly preclude the filing with regulatory authorities and, ultimately, our ability to commercialize the TCM formula candidate and generate revenue.

***Although the assessment tools for the assessment of ADHD and ASD are globally recognized, the outcome of our efficacy trial may be subject to some biases of parents and caregivers of patients because we relied on the data provided by them.***

 ****

The assessment tools we used in our efficacy trial include (i) Sik-Kee Au TCM Brain Theory® for ADHD/ASD Assessment ("SKATBT-A<sup>3</sup>"), which is a 48-item questionnaire developed by our research and development team, designed to assess patients' conditions that are commonly observed by the TCM Practitioner. Items assessed are indicative of patients' overall body and neurological conditions based on the TCM Practitioner's brain theory and his over 30 years of experience in treating ADHD and ASD patients; (ii) Autism Treatment Evaluation Checklist ("ATEC"); (iii) Gilliam Autism Rating Scale ("GARS"); (iv) Vanderbilt ADHD Diagnostic Parent Rating Scale ("VADRS"); and (v) Swanson, Nolan, and Pelham (SNAP)-IV 26-item Parent Rating Scale ("SNAP-IV-26"). Most of these assessment tools are globally recognized and accepted methods of scoring severity levels of ADHD and ASD patients.

We believe that these assessment tools serve a useful purpose in helping us evaluate the effectiveness of our TCM formula candidate. Based on the results of these assessments, we are then able to identify additional TCM formula candidates, direct our resources efficiently, and provide data support for our future applications of proprietary Chinese medicine ("pCm") registrations with the Hong Kong Chinese Medicine Council.

Notwithstanding the foregoing, we rely on parents or caregivers of patients to provide us with initial data for which we cannot guarantee accuracy. If the parents and caregivers of enrolled ADHD and ASD patients fail to observe and record accurately, we will not only fail to realize any benefits from using these assessment tools, but may also be led to invest time and financial resources inefficiently in attempting to develop inappropriate TCM formula candidate. In addition, the results of the assessment may not be as anticipated, which may cause us to abandon and/or re-evaluate our TCM formula. The timing for regulatory approval and commercialization may be delayed. These may significantly impair our ability to generate revenues and will materially adversely affect our results of operations.

***If we encounter difficulties enrolling patients in our research studies, our TCM formula development could be delayed or otherwise adversely affected.***

We conduct research studies involving TCM formula candidates whose activity and specificity have been optimized by our TCM Practitioner in his prior ADHD and ASD treatments. Timely completion of research studies in accordance with the protocols depends, among other things, on our ability to enroll a sufficient number of patients who meet the efficacy trial criteria and remain in the study until the conclusion. We may experience difficulties enrolling and retaining appropriate patients in our efficacy trial for a variety of reasons, including but not limited to:

● the size and nature of the patient population;

● eligibility of patients based on our criteria;

● the specific design of each study and subsequent changes in the design;

● our ability to recruit personnel with the appropriate competencies and experience;

● competing research studies for similar therapies or other new therapeutics, which will reduce the number and types of patients available;

● patients' perceptions of the potential advantages and side effects of the TCM formula being studied in relation to other available therapies, including any new drug candidates or treatments that may be approved for the indications we are investigating;

● our ability to obtain and maintain patient consents;

● patients' attrition; and

● the availability of approved therapies that are similar to our TCM formula candidates.

Even if we are able to enroll a sufficient number of patients in our efficacy trial, delays in patient enrollment may result in increased costs or may affect the timing or outcome of the planned research studies, which could prevent completion of these studies and adversely affect our ability to advance the development of our TCM formula candidate.

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***We may engage third parties to conduct our efficacy trials.***

We may engage third parties, such as clinical investigators and contract laboratories to oversee some or all of the operations of our efficacy trials and to perform data collection and analysis. As a result, we may face delays outside of our control if these parties do not fulfill their obligations in a timely fashion or in accordance with regulatory requirements. If these third parties do not successfully carry out their contractual duties or obligations and meet expected deadlines, if they need to be replaced, or if the quality or accuracy of the clinical data they obtain is compromised due to the failure to adhere to our clinical protocols or for other reasons, our financial results and the commercial prospects for our TCM formula could be harmed, our costs could increase and our ability to obtain regulatory approval and commence product sales could be delayed.

***Changes in regulatory requirements and guidance or unanticipated events during our efficacy trials may occur, which may result in necessary changes to efficacy trial protocols, which could result in increased costs to us, delay our development timeline or reduce the likelihood of successful completion of our efficacy trials.***

Changes in regulatory requirements and guidance or unanticipated events during our efficacy trials may occur, and as a result, we may need to amend our efficacy trial protocols. Amendments may require us to resubmit our efficacy trial protocols to the applicable regulatory authorities for review and approval, which may adversely affect the cost, timing and successful completion of an efficacy trial. If we experience delays in the completion of, or if we terminate, any of our efficacy trials, the commercial prospects for our TCM formula would be harmed and our ability to generate product revenue would be delayed, possibly materially.

***Results of our earlier studies on personalized TCM formula may not be predictive of future efficacy trial results. Failure can occur at any stage of research and development.***

The results of research studies of our personalized TCM formula may not be predictive of the results of standardized TCM formula candidate. Standardized TCM formula candidate may fail to show the desired safety and efficacy despite positive results of personalized TCM formula. Based upon negative or inconclusive results, we, along with our TCM Practitioner or any potential future collaborator may decide, or regulators may require us, to conduct additional research studies. In addition, data obtained from research studies are susceptible to varying interpretations, and regulators may not interpret our data as favorably as we do, which may delay, limit, or prevent regulatory approval.

As of the date of this Annual Report, our second efficacy trial in ADHD and ASD in Hong Kong is ongoing. However, there is no assurance whether our second efficacy trial needs to be redesigned. Research studies can be delayed or aborted for a variety of reasons, including delay or failure to:

● recruit suitable patients to participate in research studies and have such patients complete the research studies or return for post-treatment follow-up;

● address any patient safety concerns that arise during the course of an efficacy trial;

● ensure that patients comply with and complete efficacy trial protocol;

● initiate or add a sufficient number of efficacy trial sites;

● manufacture sufficient quantities of TCM formula candidate for use in research studies and ensure efficacy trial material is provided to efficacy trial sites in a timely manner; and

● obtain the statistical analysis plan to be used to evaluate the efficacy trial data.

Qualified patient enrollment is a significant factor in our research studies and is affected by many factors, including the size and nature of the patient population, the eligibility criteria for the studies, the design of the efficacy trial, competing research studies and patients' perceptions as to the potential advantages of the TCM formula being studied in relation to other available therapies.

If we experience delays in the start or completion of, or termination of, any research studies of our TCM formula candidate, the commercial prospects of our TCM formula candidate may be affected, and our ability to generate product revenues will be delayed. In addition, any delays in completing our research studies will increase our costs, slow down our TCM formula candidate's development and approval process and jeopardize our ability to commence product sales and generate revenues. Any of these occurrences may negatively harm our business, financial condition and prospects. In addition, many of the factors that cause, or lead to, a delay in the commencement or completion of research studies may also ultimately lead to the denial of regulatory approval of our TCM formula candidate.

***Our TCM formula candidate may cause undesirable side effects that could delay or prevent their regulatory approval, limit the commercial profile of an approved label, or result in significant negative consequences following regulatory approval, if any.***

Potential undesirable side effects caused by our TCM formula candidate may cause it to interrupt, delay, or halt research studies or could cause regulatory authorities to interrupt, delay, or halt our research studies or could result in a more restrictive label or the delay or denial of regulatory approval by the Hong Kong Chinese Medicines Board, or other regulatory authorities. We may observe some potential side effects in future research studies that could affect patient recruitment or the ability of enrolled patients to complete the study or result in potential product liability claims. Any of these occurrences may harm our business, financial condition, and prospects significantly.

Our research studies assessed a sample of the potential patient population. With a limited number of patients and duration of exposure, rare and severe side effects of our TCM formula candidate may only be uncovered with a large number of patients exposed to the TCM formula treatment. If our TCM formula candidate receive regulatory approval and we, our partners, or others identify undesirable side effects caused by such standardized liquid-based TCM formula treatment after such approval, a number of potentially significant negative consequences could result, including:

● the Hong Kong Chinese Medicines Board or other comparable regulatory authorities may withdraw or limit their approval of such standardized TCM formula candidate;

● we may be required to create a medication guide outlining the risks of such side effects for distribution to patients;

● we may be required to change the way such standardized TCM formula candidate is distributed or administered, conduct additional research studies, or change the labeling of our TCM formula treatment;

● the Hong Kong Chinese Medicines Board or other comparable regulatory authorities may require a risk evaluation and mitigation strategy, plan to mitigate risks, which could include medication guides, physician communication plans, or elements to assure safe use, such as restricted distribution methods, patient registries and other risk minimization tools;

● we may be subject to regulatory investigations and government enforcement actions;

● we may decide to remove such TCM formula treatment from the marketplace;

● we could be sued and held liable for injury caused to individuals exposed to or taking our TCM formula treatment; and

● our reputation may suffer.

Any of these events could prevent us from achieving or maintaining market acceptance of the affected TCM formula treatment and could substantially increase the costs of commercializing our TCM formula treatment, if approved, and significantly impact our ability to successfully commercialize our TCM formula and generate revenue.

***If any of our TCM formula are approved for marketing and commercialization and we are unable to develop, manufacture, sales, marketing and distribution capabilities on our own or enter into agreements with third parties to produce and sell our products on acceptable terms, we will be unable to successfully commercialize any such future therapeutics.***

We currently have no sales and marketing, or distribution capabilities or experience. In order to commercialize our standardized TCM formula, if approved, we must build marketing and sales capabilities or decide to make arrangements with third parties to produce and sell products, and we may not be successful in doing so. Building the requisite sales, marketing or distribution capabilities will be expensive and time-consuming and will require significant attention of our leadership team to manage. Any failure or delay in the development of our sales, marketing or distribution capabilities would adversely impact on the commercialization of our products. The competition for talented individuals experienced in selling and marketing TCM products is intense, and we cannot assure you that we can assemble an effective team. Additionally, we may choose to collaborate with third parties on the commercialization of our standardized TCM formula candidate. If we are unable to enter into such arrangements on acceptable terms or at all, we may not be able to successfully commercialize our standardized TCM formula if and when we receive regulatory approval, or any such commercialization may experience delays or limitations.

We may be subject to additional risks related to operating in foreign countries either ourselves or through a third-party, including:

● differing regulatory requirements in foreign countries;

● unexpected changes in tariffs, trade barriers, price and exchange controls and other regulatory requirements;

● economic weakness, including inflation or political instability in particular foreign economies and markets;

● compliance with tax, employment, immigration and labor laws for employees living or traveling abroad;

● foreign taxes, including withholding of payroll taxes;

● foreign currency fluctuations, which could result in increased operating expenses and reduced revenues, and other obligations incident to doing business in another country;

● difficulties staffing and managing foreign operations;

● workforce uncertainty in countries where labor unrest is more common than in the United States;

● potential liability under the Foreign Corrupt Practices Act of 1977 or comparable foreign regulations;

● challenges enforcing our contractual and intellectual property rights, especially in those foreign countries that do not respect and protect intellectual property rights to the same extent as the United States;

● production shortages resulting from any events affecting raw material supply or manufacturing capabilities abroad; and

● business interruptions resulting from geopolitical actions, including war and terrorism.

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***Even if our TCM formula that we may develop receives marketing approval, we will continue to face extensive regulatory requirements, and any such product may still face future development and regulatory difficulties. In addition, we are subject to government regulations, and we may experience delays in obtaining the required regulatory approvals to market our TCM formula.***

Even if we receive regulatory approval to market our TCM formula, we remain subject to extensive regulatory requirements, including requirements relating to manufacturing, labeling, packaging, adverse event reporting, storage, advertising, promotion, distribution and recordkeeping. Even if regulatory approval of a product is granted, the approval may be subject to limitations on the uses for which our TCM formula may be marketed or the conditions of approval, or may contain requirements for costly post-marketing testing and surveillance to monitor the safety or efficacy of the product, which could adversely affect us by reducing revenues or increasing expenses, and cause the approved TCM formula not to be commercially viable. In addition, as clinical experience with a drug expands after approval, typically because it is used by a greater number and more diverse group of patients after approval than during efficacy trials, side effects and other problems may be observed over time after approval that were not seen or anticipated during pre-approval efficacy trials or other studies. Any adverse effects observed after the approval and marketing of a product candidate could result in limitations on the use of or withdrawal of any approved products from the marketplace. The absence of long-term safety data may also limit the approved uses of our TCM formula, if any. If we fail to comply with the applicable regulatory requirements, we could be subject to administrative or judicially imposed sanctions or other setbacks, including, without limitation, the following: suspend or impose restrictions on operations; refuse to approve pending applications or supplements to applications; suspend any ongoing efficacy trials; suspend or withdraw marketing approval; seek an injunction or impose civil or criminal penalties or monetary fines; seize or detain products; ban or restrict imports and exports; issue warning letters or untitled letters; or refuse to approve pending applications or supplements to applications. Delays in regulatory approval, limitations in regulatory approval and withdrawals of regulatory approval may have a material adverse effect on the Company.

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***Acceptance of our TCM formula is uncertain, and failure to achieve market acceptance, after we obtain approval for marketing, will negatively impact our future business and operations.***

Our TCM formula may not achieve market acceptance even if they are approved by regulatory authorities. The degree of market acceptance of such products will depend on a number of factors, including the receipt and timing of regulatory approvals for the uses that we are studying, and the establishment and demonstration to the medical community of the safety of our future TCM products and their potential advantages and effectiveness to the patients. Our targeted patients may be unwilling to accept and use any of our products or recommend our products to the other patients. This may impair our future sales volume, our results of operations and our business.

***We may rely on third party manufacturers to manufacture our product candidates for purposes of efficacy trials and commercial quantities of our product candidates, if and when approved for marketing by the applicable regulatory authorities.***

With respect to the production of the starting material required for future efficacy trials, we may rely on the third parties' manufacturing capabilities. Although we have not yet engaged any contract manufacturers or other service providers, if and when we do, our contract manufacturers and service providers must complete technology transfer, process validation for the manufacturing process and demonstrate successful manufacturing of comparable product. Our and any of our contract manufacturers' and other service providers may fail to achieve and maintain high manufacturing standards, in accordance with applicable regulatory requirements, or the incidence of manufacturing errors, could result in patient injury or death, product shortages, product recalls or withdrawals, delays or failures in product testing or delivery, cost overruns or other problems that could seriously harm our business. Contract manufacturers and service providers may encounter difficulties involving production yields, quality control and quality assurance, as well as shortages of qualified personnel. Our future contract manufacturers and service providers may not perform as agreed or may not remain in the contract manufacturing business. If our contract manufacturers and service providers, and their respective facilities, as applicable, are not approved by the applicable regulatory authorities or if they fail to comply with the applicable regulations on their manufacturing facilities, processes and quality systems, among other things, the commercial supply of TCM formula will be significantly delayed and may result in significant additional costs, and we may even be subject to fines, unanticipated compliance expenses, product recall or enforcement actions. If we need to identify additional finished product manufacturers, we would not be able to do so without significant delay and likely significant additional cost. In addition, In the event of a natural disaster, business failure, strike or other difficulty, we may be unable to replace our manufacturing capacity or a third-party manufacturer or provider in a timely manner and the production of our product candidates would be interrupted, resulting in delays and additional costs.

***We may engage third parties to market and sell our products, if and when approved for marketing by the applicable regulatory authorities.***

We have no sales or distribution capabilities. To the extent we engage or rely on third parties to commercialize our products, if marketing approval is obtained, we may receive less revenue than if we commercialize such products ourselves. In addition, we would have less control over the sales efforts of any third parties involved in our commercialization efforts. In the event we are unable to collaborate with a third-party marketing and sales organization to commercialize our products, our ability to generate revenue will be limited.

Although we may ultimately develop a marketing and sales force with technical expertise and supporting distribution capabilities in the longer term after the marketing approval is obtained, we do not currently intend to do so. We, therefore, may not be able to directly market our products, if any, in a short period of time after marketing approval is obtained. To promote any of our potential products through third parties, we will have to locate acceptable third parties for these functions. We may not be able to enter into agreements with them on acceptable terms. In addition, to the extent that we depend on third parties for marketing and distribution, any revenues we receive will depend upon the efforts of such third parties, as well as the terms of our agreements with such third parties. If our products, after marketing approval is obtained, could not be marketed and sold effectively, our business and results of operations may materially and adversely affected.

***Any collaboration arrangements that we may enter into in the future may not be successful, which could adversely affect our ability to develop and commercialize our current and any future product candidates.***

We may determine to seek collaboration arrangements in the future with third parties for the development and commercialization of our TCM formula and any future product candidates. To the extent that we decide to enter into any collaboration agreements, we may face significant competition in seeking appropriate collaborators. Moreover, collaboration arrangements are complex and time consuming to negotiate, document and implement. We may not be successful in our efforts to establish and implement collaborations or other alternative arrangements. Additionally, the terms of any collaborations or other arrangements that we may establish may not be favorable to us.

Any future collaborations that we enter into may not be successful. The success of our collaboration arrangements, if any, would depend heavily on the efforts and activities of our collaborators. Collaborators generally have significant discretion in determining the efforts and resources that they will apply to these collaborations. For example, we may not be able to control the amount and timing of resources that the collaboration partner devotes to the product development or marketing programs, the collaboration partner may experience financial difficulties, or we may be required to relinquish important rights such as marketing, distribution, and intellectual property rights. Disagreements between parties to a collaboration arrangement regarding clinical development and commercialization matters can lead to delays in the development process or commercializing the applicable product candidate and, in some cases, termination of the collaboration arrangement. These disagreements can be difficult to resolve and result in early termination. Any such early termination or expiration could adversely affect us financially and could harm our business reputation. We cannot be certain that, following any collaboration, strategic transaction or license, we will achieve the results, revenue, or specific net income that justifies such transaction.

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***If we fail to increase our brand recognition, we may face difficulty in obtaining new customers or patients.***

We believe that developing, maintaining and enhancing our brand recognition in a cost-effective manner outside of that market is critical to achieving widespread acceptance of our future products and is an important element in our effort to build our customer or patient base. Successful promotion of our brand and products in the TCM and medical industry will depend largely on our ability to maintain a sizeable and active customer or patient base, our marketing efforts and ability to provide reliable and useful products and treatments at competitive prices. Brand promotional activities may not yield increased revenue in the near future, and even if they do, any increased revenue may not offset the expenses we will incur in building our brand. If we fail to successfully promote and maintain our brand during our commercialization period, or if we incur substantial expenses in an unsuccessful attempt to promote and maintain our brand, we may fail to attract enough customers or patients to the extent necessary to realize a sufficient return on our brand-building efforts, in which case our business, operating results and financial condition, would be materially adversely affected.

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***Our success depends on our ability to obtain and protect our intellectual property.***

The TCM formula is the core of our business operation and TCM research and development. We seek to protect the TCM formula candidate and technology that we consider commercially important by filing patent applications in Hong Kong and abroad or rely on our trade secrets. Although we intend to file for patent applications with the authorities concerned in Hong Kong, there is no assurance that they will be granted, or that, if granted, any of our future patents will be held valid and enforceable against third-party infringement, or that our formula will not infringe any third-party patent or intellectual property.

Any patents relating to our formula, if granted, may not be sufficiently broad to protect them. In addition, our patents, if granted, may be challenged, potentially invalidated or potentially circumvented. Our patents, if granted, may not afford us protection against competitors with similar formula or permit the commercialization of our products without infringing third-party patents or other intellectual property rights.

Further, we also rely on or intend to rely on our trademarks, trade names and brand names to distinguish our products from the products of our competitors, and have registered or will apply to register a number of these trademarks. We have received trademark certificates for "腦還原<sup>®</sup>" (directly translates as "brain restoration"), "RGC Regencell<sup>®</sup>", "RGC<sup>®</sup>" and "Sik-Kee Au TCM Brain Theory<sup>®</sup>" from the Hong Kong Registrar of Trade Marks. However, third parties may oppose our trademark applications or otherwise challenge our use of the trademarks. Further, our competitors may infringe our trademarks, or we may not have adequate resources to enforce our trademarks. Effective trademark protection may not be available or may not be sought in every country in which our products are made available in the future. In the event that our trademarks or applications are successfully challenged, we could be forced to rebrand our products, which could result in loss of brand recognition and could require us to devote resources to advertising and marketing these new brands.

Third parties may make claims challenging the inventorship or ownership of our TCM formula. In addition, we may face claims by third parties that our agreements with employees, contractors or consultants obligating them to assign intellectual property to us are ineffective or in conflict with prior or competing contractual obligations of assignment, which could result in ownership disputes regarding intellectual property we have developed or will develop and interfere with our ability to capture the commercial value of such intellectual property. Litigation may be necessary to resolve an ownership dispute, and if we are not successful, we may be precluded from using certain intellectual property or may lose our exclusive rights in that intellectual property. Either outcome could harm our business and competitive position.

We also rely on trade secrets, including unpatented know-how, technology and TCM related regulatory protection, to maintain our competitive position in our TCM research. While our current employment agreements with our employees contain provisions protecting our confidential information, including the knowledge of pCm, prescriptions, techniques, and skills, we may seek to protect, in part, by entering into separate confidentiality agreements with licensees, suppliers, employees and consultants in the future. These agreements may be breached and there may not be adequate remedies in the event of a breach. Disputes may arise concerning the ownership of intellectual property or the applicability of confidentiality agreements. Moreover, our trade secrets and proprietary technology may otherwise become known or be independently developed by our competitors. If patents are not issued with respect to products arising from research, we may not be able to maintain the confidentiality of information relating to these products.

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***Adverse publicity associated with our TCM formula candidate, ingredients or network marketing program, or those of similar companies, could harm our financial condition and operating results.***

The results of our operations may be significantly affected by the public's perception of our TCM formula candidate and the overall TCM treatment industry. This perception is dependent upon opinions concerning:

● the safety and quality of our TCM formula and ingredients;

● the safety and quality of similar products and ingredients distributed by other TCM companies; and

● our sales force.

Adverse publicity concerning any actual or purported failure to comply with applicable laws and regulations regarding product claims and advertising, good manufacturing practices, or other aspects of our business, whether or not resulting in enforcement actions or the imposition of penalties, could have an adverse effect on our goodwill and could negatively affect our sales and ability to generate revenue. In addition, our consumers' perception of the safety and quality of products and ingredients as well as similar products and ingredients distributed by other companies can be significantly influenced by media attention, publicized scientific research or findings, widespread product liability claims and other publicity concerning our TCM formula candidate or ingredients or similar products and ingredients distributed by other companies. Adverse publicity, whether or not accurate or resulting from consumers' use or misuse of our TCM formula treatment, that associates consumption of our TCM formula treatment or ingredients or any similar products or ingredients with illness or other adverse effects, questions the benefits of our or similar products or claims that any such products are ineffective, inappropriately labeled or have inaccurate instructions as to their use, could negatively impact our reputation or the market demand for our TCM formula treatment.

***Any disruption in the supply chain of raw materials and our products could adversely impact our ability to produce and deliver products.***

As to the products we intend to manufacture, we must manage our supply chain for raw materials and delivery of our products. Our raw material used in efficacy trial is currently sourced by the TCM Practitioner from Hong Kong vendors under the Hong Kong Chinese Medicine Regulatory Office guideline. Local administrative bodies and physical infrastructure built to protect local interests pose transportation challenges for raw material transportation as well as product delivery in Hong Kong. In addition, profitability and volume could be negatively impacted by limitations inherent within the supply chain, including competitive, governmental, legal, natural disasters, and other events that could impact both supply and price. Any of these occurrences could cause significant disruptions to our supply chain, manufacturing capability and distribution system that could adversely impact our ability to produce and deliver some of our products.

Our raw materials are not sourced from endangered species of animals or plants. All of our raw materials are readily available in over 6,000 TCM stores, wholesalers, and other distribution channels in Hong Kong.

***Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.***

We employ individuals who previously worked with other companies, including our competitors or potential competitors. Although we try to ensure that our employees, contractors, or consultants do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or our employees, consultants or independent contractors have inadvertently or otherwise used or disclosed intellectual property, including trade secrets or other proprietary information, of a former employer or other third party. Litigation may be necessary to defend against these claims. If we fail in defending any such claims or settling those claims, in addition to paying monetary damages or a settlement payment, we may lose valuable intellectual property rights or personnel. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a distraction to management and other employees.

***We may plan to use new and evolving technologies, such as artificial intelligence ("AI") in our operations. The use may require us to expend material resources and may present risks and challenges that can impact our business, including by posing security and other risks to our confidential information, proprietary information and personal information, any of which may result in reputational harm and liability, or otherwise adversely affect our business.***

We may choose to integrate AI into our operations, and this innovation presents risks and challenges that could affect its adoption, and therefore our business. There are significant risks involved in utilizing AI and no assurance can be provided that the usage of AI will enhance our business or assist our business in becoming more efficient or profitable. The use of certain AI technology can give rise to intellectual property risks, including compromises to intellectual property and proprietary information as well as intellectual property infringement and misappropriation. Other known risks of AI currently include inaccuracy, bias, toxicity, data privacy and cybersecurity issues, and data provenance disputes. In addition, AI may have errors or inadequacies that are not easily detectable. AI may also be subject to data herding and interconnectedness (i.e., multiple market participants utilizing the same data), which may adversely impact our business. If the data used to train AI or the content, analyses, or recommendations that AI applications assist in producing are or are alleged to be deficient, inaccurate, incomplete, overbroad or biased, our business, financial condition, and results of operations may be adversely affected.

Additionally, we expect to see increasing government and supranational regulation and ethical concerns related to AI use, which may also significantly increase the burden and cost of research, development and compliance in this area. The rapid evolution of AI will require the application of significant resources to design, develop, test and maintain our technology and products to help ensure that AI is implemented in accordance with applicable laws and regulations and in a socially responsible manner and to minimize any real or perceived unintended harmful impacts. The legal landscape and subsequent legal protection for the use of AI remains uncertain, and development of the law in this area could impact our ability to enforce our proprietary rights or protect against infringing uses. If we do not have sufficient rights to use the data on which AI relies or to the outputs produced by AI applications, we may incur liability through the violation of certain laws, third-party privacy or other rights or contracts to which we are a party. Our use of AI applications may also, in the future, result in cybersecurity incidents that implicate the personal data of patients. Any such cybersecurity incidents related to our use of AI applications could adversely affect our reputation and results of operations.

Our vendors, collaborators or third-party service providers may also incorporate AI tools into their own offerings, and the providers of these AI tools may not meet existing or rapidly evolving regulatory or industry standards, including with respect to intellectual property, data privacy and cybersecurity. Further, bad actors around the world use increasingly sophisticated methods, including the use of AI, to engage in illegal activities involving the theft and misuse of personal information, confidential information and intellectual property. Any of these effects could damage our reputation, result in the loss of valuable property and information, cause us to breach applicable laws and regulations, or otherwise adversely impact our business.

***Breaches of network or information technology and data security could have an adverse effect on our business.***

Our business partially relies upon information technology systems operated by us and by our third-party service providers. These systems may fail or experience operational disruption, experience cybersecurity attacks, computer viruses and other means of unauthorized access, or be damaged by computer viruses and unauthorized access. If we fail to maintain adequate policies and procedures for the protection of our information technology systems and confidential and proprietary information, we may be vulnerable to security breaches or disruptions and system breakdowns or other damage or interruptions which may result in a loss or corruption of critical data assets including trade secrets or other proprietary information.

***Environmental, social and corporate governance issues, including those related to climate change and sustainability, may have an adverse effect on our business, financial condition and results of operations and damage our reputation.***

In recent years, there has been an increasing focus concerning environmental, social and corporate governance ("ESG") matters, including climate change, energy and water use, plastic waste and other sustainability concerns. If our ESG practices fail to meet regulatory requirements or investor, patient, employee or other stakeholders' evolving expectations and standards for responsible corporate citizenship in areas including environmental stewardship, support for local communities, board of directors and employee diversity, human capital management, employee health and safety practices, product quality, supply chain management, corporate governance and transparency, our reputation, brand and employee retention may be negatively impacted. Further, if we do not adapt to or comply with new regulations, or fail to meet investor, industry or stakeholders' expectations and concerns regarding ESG issues, investors may reconsider their capital investment in our company, we may become subject to penalties, and customers and consumers may choose to stop purchasing our products, if approved for commercialization, which could have a material adverse effect on our reputation, business or financial condition.

***We face risks related to health epidemics and outbreaks, which could significantly disrupt our ongoing research studies, and therefore our receipt of necessary regulatory approvals could be delayed or prevented.***

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We face risks related to health epidemics or outbreaks of communicable diseases. The outbreak of such communicable diseases could result in a widespread health crisis that could adversely affect general commercial activity and the economies and financial markets of many countries. Disruptions or restrictions on our ability to travel to monitor data from our enrolled patients, or to conduct research studies, or the ability of patients enrolled in our studies to travel, as well as temporary closures of our facilities would negatively impact our efficacy trial activities. As a result, the expected timeline for data readouts of our research studies on enrolled patients and certain regulatory filings may be negatively impacted, which would adversely affect our ability to obtain regulatory approval for and to commercialize our products, increase our operating expenses and have a material adverse effect on our financial results.

***The global economic and political conditions have been and continue to be challenging and have had, and may continue to have, an adverse effect on the financial markets and the economy in general, which has had, and may continue to have, a material adverse effect on our business, financial performance and results of operations and the prices of our Ordinary Shares.***

Adverse global economic and political conditions, crises and terrorist attacks could lead to significant market and other disruptions, including significant volatility in commodity prices, supply of energy resources, supply chain interruptions, political and social instability and changes in consumer or purchaser preferences. These could adversely affect the raw material prices of our TCM products when we commence the production and the patients' financial abilities to consume our products.

Volatility in the domestic politics of major markets may lead to changes in the institutional framework of the international economy. In many countries globally, there are concerns over rising inflation and potential economic recessions. In particular, any worsening of the ongoing labor shortage and ongoing rise in inflation could significantly weaken global economies. Globally, countries have required and may continue to require additional financial support, sovereign credit ratings have declined and may continue to decline, and there may be default on sovereign debt obligations of certain countries. In addition, the U.S. Federal Reserve System and other regulatory bodies around the world may raise, or may announce intentions to raise, interest rates. Any of these global economic conditions may increase the cost of borrowing and cause credit to become more limited, which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

In addition, economic and political conditions have affected, and may continue to affect, our business in a number of ways. The cost and availability of credit has been and may continue to be adversely affected by illiquid credit markets and wider credit spreads. If these market conditions continue or worsen, they may further limit our ability to access financing or increase our cost of financing to meet liquidity needs, resulting in adverse effects on our financial condition and results of operations. Any global economic slowdown and uncertainty about the future global economic conditions could also continue to increase the volatility of the prices of our Ordinary Shares. We cannot predict the timing or duration of any economic slowdown or strength of a subsequent economic recovery generally or in our industry. If macroeconomic conditions worsen or the current global economic conditions continue for a prolonged period of time, we are not able to predict the impact that such conditions will have on our industry in general, and our results of operations specifically.

**General Company Related Risks**

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***The market price for our Ordinary Shares may be volatile.***

The market price for our Ordinary Shares has recently been very volatile and the price may not reflect our value. We believe this volatility may be caused in substantial part by a "short squeeze" or other anomalous trading activity causing demand for, and price of, our Ordinary Shares to increase. There can be no assurance that there will be an active market for our Ordinary Shares in the future. The market liquidity will be dependent on the perception of our operating business and any steps that our management might take to bring us to the awareness of investors. There can be no assurance given that there will be any awareness generated. Consequently, investors may not be able to liquidate their investment or liquidate it at a price that reflects the value of the business. If a more active market should develop, the price may be highly volatile. The market price for our Ordinary Shares may continue to be volatile and subject to wide fluctuations due to factors such as:

● the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;

● actual or anticipated fluctuations in our quarterly operating results;

● changes in financial estimates by securities research analysts;

● negative publicity, studies or reports;

● comments by other third parties, including blogs, articles, message boards and social and other media;

● an increase or decrease in the short interest in our Ordinary Shares

● our capability to catch up with the technological innovations in the industry;

● announcements by us or our competitors of acquisitions, strategic partnerships, joint ventures or capital commitments;

● addition or departure of key personnel;

● the sale or availability for sale, or perceived sale or availability for sale, of substantial amounts of our Ordinary Shares in the market;

● any future financing in the capital market to raise fund for our operations;

● fluctuations of exchange rates between Hong Kong dollar and the U.S. dollar; and

● general economic or political conditions in Hong Kong.

Many of these factors and conditions are beyond the control of us and our shareholders. In addition, the securities market has from time-to-time experienced significant price and volume fluctuations that are not related to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of our Ordinary Shares.

Over the last several months, our share price has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of our company. For example, on June 16, 2025, our Ordinary Shares experienced an intra-day trading high of $83.600 per share and a low of $26.200 per share. In addition, from April 26, 2025 to June 20, 2025, the closing price of our Ordinary Shares on the Nasdaq Stock Market LLC ranged from as low as $0.832 per share to $83.600 per share. During this time, we have not experienced any material changes in our financial condition or results of operations that would explain such price volatility or trading volume. These broad market fluctuations may adversely affect the trading price of our Ordinary Shares. We believe a large proportion of our Ordinary Shares has been and may continue to be traded by short sellers which has put and may continue to put pressure on the supply and demand for our Ordinary Shares, further influencing volatility in its market price. Additionally, these and other external factors have caused and may continue to cause the market price and demand for our Ordinary Shares to fluctuate, which may limit or prevent investors from readily selling their Ordinary Shares, selling their Ordinary Shares at a favorable price, and may otherwise negatively affect the liquidity or price of our Ordinary Shares.

The market for our Ordinary Shares may continue to have, when compared to seasoned issuers, significant price volatility. In the past, plaintiffs have often initiated securities class action litigation against public companies following periods of volatility in the market price of its securities. We may, in the future, be the target of similar litigation, which could result in substantial costs and liabilities and could divert management's attention and resources.

***A possible "short squeeze" due to a sudden increase in demand of our Ordinary Shares that largely exceeds supply may lead to price volatility in our Ordinary Shares.***

We believe that investors have purchased our Ordinary Shares to hedge existing exposure in our Ordinary Shares or to speculate on the price of our Ordinary Shares. Speculation on the price of our Ordinary Shares may involve long and short exposures. To the extent aggregate short exposure exceeds the number of shares of our Ordinary Shares available for purchase in the open market, investors with short exposure may have to pay a premium to repurchase our Ordinary Shares for delivery to lenders of our Ordinary Shares. Those repurchases may in turn, dramatically increase the price of our Ordinary Shares until additional shares of our Ordinary Shares are available for trading or borrowing. This is often referred to as a "short squeeze." We believe that a large proportion of our Ordinary Shares (other than shares held by the Company's directors and officers) has been and may continue to be traded by short sellers which may increase the likelihood that our Ordinary Shares will be the target of a short squeeze. We believe that this activity has led and could continue to lead to volatile price movements in shares of our Ordinary Shares that are unrelated or disproportionate to our operating performance or prospectus and, once investors purchase the shares of our Ordinary Shares necessary to cover their short positions, the price of our Ordinary Shares may rapidly decline. Investors that purchase shares of our Ordinary Shares during a short squeeze may lose a significant portion of their investment.

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***Legal and regulatory proceedings involve risks.***

We may, from time to time, be subject to claims, lawsuits and, government investigations, including but not limited to those relating to our share volatility, our business, operations, intellectual property, consumer protection, privacy, labor and employment, securities, tax, marketing and communications practices, commercial disputes, and other matters. Becoming a public company and the performance of our share price have raised our public profile, which may result in increased inquiries, investigations and risk of litigation as well as increased public awareness of any such litigation. In addition, as discussed further in "Item 8. Financial Information—A. Consolidated Statements and Other Financial Information—Legal Proceedings," we have been subject to a regulatory investigation regarding the recent volatility in our share price. There is substantial uncertainty regarding the scope and application of many of the laws and regulations to which we may be subject, which increases the risk that we will be subject to claims alleging violations of those laws and regulations. In the future, we may also be accused of having, or be found to have, infringed, misappropriated or otherwise violated third-party intellectual property rights.

Regardless of the outcome, legal proceedings can have a material and adverse impact on us due to their costs, diversion of our resources, impact to our financial condition, reputational impact and other factors. Any inquiry or investigation or responding to inquiry or investigation can sometimes attract unwanted attention and consume significant resources. We may decide to settle legal disputes on terms that are unfavorable to us. Furthermore, if any litigation to which we are a party is resolved adversely, we may be subject to an unfavorable judgment that we may not choose to appeal or that may not be reversed upon appeal. In addition, the terms of any settlement or judgment in connection with any legal claims, lawsuits, or proceedings may require us to cease some or all of our operations, or pay substantial amounts to the other party and could materially and adversely affect our business, financial condition and results of operations.

***Investment in digital assets could adversely affect our financial condition and results of operations.***

Our management may consider a Digital Asset Treasury (DAT) policy that permits the investment of digital assets, such as Bitcoin, Ethereum and other cryptocurrencies, either directly or through exchange-traded products ("ETPs") that hold such assets. We have not made any purchases as of the date hereof and have no experience in such type of investment. Investments in digital assets are subject to significant risks and volatility:

● *Price Volatility*: The market prices of bitcoin, and other cryptocurrencies have historically been highly volatile and may be influenced by factors beyond our control, including market sentiment, macroeconomic conditions, changes in supply and demand, geopolitical events, regulatory developments, technological changes, and market disruptions. Large fluctuations in fair value could materially affect our reported earnings, financial position, and share price.

● *Regulatory Risk*: Digital assets are a relatively new asset class and are subject to evolving U.S. federal, state, and foreign laws and regulations. Regulatory changes, or the interpretation or enforcement of existing laws, could restrict our ability to buy, sell, hold, or transact in digital assets and could adversely impact their value.

● *Custody and Operational Risk*: If we invest directly in digital assets, we will be exposed to operational and custody risks, including loss or theft of private keys, cybersecurity breaches, fraud, and insolvency of custodians. If we invest via ETPs, we will be subject to risks specific to those funds, including tracking errors relative to the underlying asset, reliance on the sponsor and custodian, and management fees.

● *Liquidity Risk*: The trading venues for digital assets and related products may experience outages, disruptions, or other operational issues that can impair our ability to transact, especially during times of market stress.

● *Tax and Accounting Impact*: Changes in tax law could cause us to incur tax liabilities on unrealized gains in digital assets. Accounting standards require us to record changes in fair value through earnings in each reporting period, which may increase our earnings volatility.

There is no assurance that any investment in digital assets will result in a positive return, and we may incur losses that could adversely affect our business, financial condition, and results of operations.

***We have a very limited operating history, which may make it difficult for you to evaluate the success of our business to date and to assess our future viability.***

We commenced our operations in Hong Kong through our wholly-owned subsidiary, Regencell Bioscience Limited in 2015. Our operations to date have been limited to organizing and staffing our company, partnering with the TCM Practitioner to conduct research studies, identifying potential partnerships and TCM formula candidate, acquiring TCM raw materials, and conducting research and development activities for our TCM formula candidate. We have not yet demonstrated the ability to successfully complete large-scale, pivotal research studies. We have also not yet applied for or obtained regulatory approval for, or demonstrated an ability to manufacture or commercialize, any of our TCM formula candidate. Consequently, any predictions about our future success, performance, or viability may not be as accurate as they could be if it had a longer operating history or approved products on the market.

Our limited operating history, particularly in light of the evolving TCM formula research and development industry in which we operate, may make it difficult to evaluate our current business and prospects for future performance. Our short history makes any assessment of our future performance or viability subject to significant uncertainty. We will encounter risks and difficulties frequently experienced by early-stage companies in evolving fields as we seek to transition to a company capable of supporting commercial activities. In addition, as a new business, we may be more likely to encounter unforeseen expenses, difficulties, complications, and delays due to limited experience. If we do not address these risks and difficulties successfully, our business will suffer.

***There is substantial doubt regarding our ability to continue as a going concern, indicating the possibility that we may be required to curtail or discontinue our operations in the future. If we discontinue our operations, you may lose all of your investment.***

In the audit report issued in connection with our financial statements as of and for the year ended June 30, 2025, our independent registered public accounting firm included a going concern explanatory paragraph which stated there was substantial doubt about our ability to continue as a going concern. See "Report of Independent Registered Public Accounting Firm" and Note 2 to the consolidated financial statements included elsewhere in this Annual Report. We incurred total net losses of $3.58 million and $4.36 million, respectively, for the fiscal years ended June 30, 2025 and 2024, and have completed only the preliminary stages of our business plan. We anticipate incurring additional losses before realizing any revenues. We may need additional financing in order to meet our continuing obligations and ultimately, to attain profitability in the future. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue our business. If we are unable to obtain enough financing from outside sources before we produce enough revenues, we may be forced to sell our assets, or curtail or discontinue our operations and may not be able to continue as a going concern. If this happens, you could lose all or part of your investment.

***Our future operating results are difficult to predict and may vary significantly from quarter to quarter, which may adversely affect the price of our Ordinary Shares.***

 

Our limited research progress of our standardized TCM formula candidate, together with our history of losses, makes prediction of future operating results difficult. You should not rely on our past performance as any indication of future growth rates or operating results. Our valuation and the price of our securities likely will fall in the event our operating results do not meet the expectations of analysts and investors. Comparisons of our quarterly operating results are an unreliable indication of our future performance because they are likely to vary significantly based on many factors, including:

● our inability to enroll enough ADHD and ASD patients into our second research studies;

● the success of our standardized TCM formula candidate to treat individuals with ADHD and/or ASD, and the possible future introduction of new products and treatments for ADHD and/or ASD;

● the successful completion of future research studies, and the possibility that the results of any future study may be adverse to our product and services, or reveal some heretofore unknown risk to patients from treatment in the personalized TCM formula; the failure by us to make professional presentation and publication of positive outcomes data from these research studies;

● our ability to commercialize the standardized TCM formula in Hong Kong once we obtain permission from the Hong Kong Chinese Medicines Board;

● the expansion and rate of success of our marketing and advertising efforts to ADHD and ASD patients, and the rate of success of our direct sales force in Hong Kong;

● failure of third-party contract manufacturers to deliver products or provide services in a cost effective and timely manner;

● our failure to compete with other treatment for ADHD and ASD;

● actions relating to ongoing compliance of the Hong Kong Chinese Medicine Ordinance (the "HKCMO");

● unanticipated delays in the development and introduction of our future products and/or our inability to control costs;

● the effects of global or local pandemics or epidemics and governmental responses; and

● general economic conditions as well as those specific to our customers and markets.

Therefore, you should expect that our results of operations will be difficult to predict, which will make an investment in our company uncertain.

***Future debt agreements may contain restrictions that may limit our flexibility in operating our business.***

Documents governing our future indebtedness, or in connection with additional capital raises, if any, may contain numerous financial and operating covenants that limit the discretion of management with respect to certain business matters. Restrictive covenants included in the above-mentioned credit facility include restrictions on, among others, our ability to incur or permit additional indebtedness and change the nature of our business.

Our ability to comply with these and other provisions of the existing loan agreement is dependent on our future performance, which will be subject to many factors, some of which are beyond our control. The breach of any negative covenants in our current or future agreements could result in an event of default, as may be defined in such agreements, thereby leading to a potential default interest rate or immediate repayment of any borrowed amounts. These restrictive covenants which may be in place from time to time and a lack of compliance by us could limit our flexibility in operating our business.

***We are wholly dependent on certain key personnel and our strategic partner, Mr. Sik-Kee Au, the father of our founder, director and CEO, and loss of these individuals could have a material adverse effect on our business, financial condition and results of operations.***

Our success is, to a certain extent, attributable to the management, and research and development expertise and potential sales and marketing of key personnel. We are dependent on the services of Mr. Yat-Gai Au, our founder, director and CEO, for the continued growth and operation of our company, and critical to our overall management, as well as the continued development of our strategic direction, due to their experience, personal and business contacts in Hong Kong and the US.

Our success of developing standardized TCM formula candidate is wholly dependent upon our strategic partnership with Mr. Sik-Kee Au, the TCM Practitioner, the father of Mr. Yat-Gai Au, our founder, director and CEO, for the continued research and development of the formula candidate for our company. The whole basis of our TCM research is the TCM formula transferred by the TCM Practitioner, which was developed based on Sik-Kee Au TCM Brain Theory<sup>®</sup>. We may not be able to retain our partnership with the TCM Practitioner for any given period of time. We are reliant upon the TCM Practitioner to provide these research services and have little control over his availability or expertise, except our Partnership Agreements (as defined below) with the TCM Practitioner. Although we have no reason to believe that he will terminate the partnership relationship with us, the interruption or loss of his services would adversely affect our ability to effectively run our business and pursue our research on standardized TCM formula candidate as well as our results of operations. The loss of any of these individuals could have a material adverse effect upon our business, financial condition, and results of operations. We do not carry key man life insurance for any of our key personnel, nor do we foresee purchasing such insurance to protect against the loss of key personnel.

***We may not be able to hire and retain qualified personnel to support our growth and if we are unable to retain or hire these personnel in the future, our ability to improve our products and implement our business objectives could be adversely affected.***

We must attract, recruit and retain a sizeable workforce of technically competent employees. Competition for senior management and personnel in Hong Kong is intense and the pool of qualified candidates in Hong Kong is very limited. We may not be able to retain the services of our senior executives or personnel, or attract and retain high-quality senior executives or personnel in the future. This failure could materially and adversely affect our future growth and financial condition.

***We have identified material weaknesses in our internal control over financial reporting. If we fail to develop and maintain an effective system of internal control over financial reporting, we may be unable to accurately report our financial results or prevent fraud.***

In the course of auditing our consolidated financial statements as of and for the years ended June 30, 2025, 2024 and 2023, we and our independent registered public accounting firms identified three material weaknesses in our internal control over financial reporting as well as other control deficiencies. As defined in standards established by the Public Company Accounting Oversight Board ("PCAOB"), a "material weakness" is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The material weaknesses identified relate to (1) our lack of sufficient skilled staff with U.S. GAAP knowledge and the U.S. Securities and Exchange Commission (the "SEC") reporting knowledge for the purpose of financial reporting as well as the lack in formal accounting policies and procedures manual to ensure proper financial reporting in accordance with U.S. GAAP and SEC reporting requirements; (2) our lack of internal audit function to establish a formal risk assessment process and internal control framework; and (3) our lack of segregation of duties for certain key functions due to limited staff and resources.

As defined under standards established by PCAOB, a material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

As a result, we have already taken some steps and have continued to implement measures to remediate the material weaknesses identified, including but not limited to (i) continuing to recruit experienced personnel with relevant past experience working on U.S. GAAP and SEC reporting, (ii) improving our monitoring of and oversight controls for non-recurring transactions to ensure the accuracy and completeness of financial reporting and (iii) engaging external experts to assist with should there be non-recurring and complex transactions and continuing to implement measures to remediate our internal control deficiencies.

All internal control systems, no matter how well designed, have inherent limitations including the possibility of human error and the circumvention or overriding of controls. Further, because of changes in conditions, the effectiveness of internal controls may vary over time. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Accordingly, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation.

We cannot be certain that these measures will successfully remediate the material weaknesses or that other material weaknesses will not be discovered in the future. If our efforts are not successful or other material weaknesses or control deficiencies occur in the future, we may be unable to report our financial results accurately on a timely basis or help prevent fraud, which could cause our reported financial results to be materially misstated and result in the loss of investor confidence or delisting and cause the market price of our Ordinary Shares to decline. In addition, it could in turn limit our access to capital markets, harm our results of operations, and lead to a decline in the trading price of our securities. Additionally, ineffective internal control over financial reporting could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential delisting from the stock exchange on which we list, regulatory investigations and civil or criminal sanctions. We may also be required to restate our financial statements from prior periods. Because of our status as an emerging growth company, you will not be able to depend on any attestation from our independent registered public accountants as to our internal control over financial reporting for the foreseeable future.

We are a public company in the United States subject to the Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley Act"). Section 404 of the Sarbanes-Oxley Act requires that we include a management report on our internal control over financial reporting in this Annual Report. In addition, once we cease to be an "emerging growth company" as such term is defined under Jumpstart Our Business Startups Act of 2012, as amended (the "JOBS Act"), our independent registered public accounting firm must attest to and report on the effectiveness of our internal control over financial reporting. Our management may conclude that our internal control over financial reporting is not effective. Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated or reviewed, or if it interprets the relevant requirements differently from us. In addition, after we become a public company, our reporting obligations may place a significant strain on our management, operational and financial resources and systems for the foreseeable future. We may be unable to timely complete our evaluation testing and any required remediation.

During the course of documenting and testing our internal control procedures, in order to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, we may identify other weaknesses and deficiencies in our internal control over financial reporting. In addition, if we fail to maintain the adequacy of our internal control over financial reporting, as these standards are modified, supplemented or amended from time to time, we may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act. Generally, if we fail to achieve and maintain an effective internal control environment, we could suffer material misstatements in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our reported financial information. This could in turn limit our access to capital markets, and harm our results of operations. Additionally, ineffective internal control over financial reporting could expose us to increased risk of fraud or misuse of corporate assets and subject us to potential delisting from the stock exchange on which we list, regulatory investigations and civil or criminal sanctions.

***The requirements of being a public company may strain our resources and divert management's attention.***

As a public company, we are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the Sarbanes-Oxley Act, the Dodd-Frank Act, the listing requirements of the Nasdaq Capital Market, and other applicable securities rules and regulations. Compliance with these rules and regulations will nonetheless divert management's attention, increase our legal, accounting, financial compliance costs and investor relations and public relations costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources, particularly after we are no longer an "emerging growth company." As a foreign private issuer, the Exchange Act requires, among other things, that we file annual and current reports with respect to our business and operating results.

As a result of disclosure of information in this Annual Report and in filings required of a public company, our business and financial condition will become more visible, which we believe may result in threatened or actual litigation, including by competitors and other third parties. If such claims are successful, our business and operating results could be harmed, and even if the claims do not result in litigation or are resolved in our favor, these claims, and the time and resources necessary to resolve them, could divert the resources of our management and adversely affect our business, brand and reputation and results of operations.

We also expect that being a public company and these new rules and regulations will make it more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These factors could also make it more difficult for us to attract and retain qualified members of our board of directors, particularly to serve on our audit committee and compensation committee, and qualified executive officers.

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***We may not be able to compete effectively against our competitors.***

We are at the early stage of the development of our liquid-based TCM formula treatment and have not sold any products successfully. We expect to face competition in the future that may result in revenue reductions for the liquid-based TCM formula treatment that we plan to deliver. We will be at a competitive disadvantage in obtaining the facilities, employees, financing and other resources required to provide services demanded by prospective customers. Our opportunity to obtain customers may be limited by our financial resources and other assets.

***Our business model may not be sufficient to ensure our success in our intended market.***

Our survival is currently dependent upon the success of our efforts to gain ADHD and ASD patients' acceptance of liquid-based TCM formula treatment that will ultimately represent a very small segment in our targeted industry when it is completed. Should our target market not be as responsive to our products as we anticipate, we may not have in place alternate products or services that we can offer to ensure our survival.

Our TCM formula treatment may not be desired for purchase by patients, or potential competitors may develop services that imitate or compete with ours or prospective offers and take our targeted revenue stream away from us or reduce our ability to command profitable revenue streams for our products. If international pharmaceutical companies, develop more successful products to cure ADHD and/or ASD or offer competitive products at a lower price, our revenue, margins, and profitability will suffer.

***Our TCM business is subject to inherent risks relating to product liability and personal injury claims.***

TCM companies, similar to pharmaceutical companies, are exposed to risks inherent in the manufacturing and distribution of TCM products, such as with respect to improper filling of prescriptions, labeling of prescriptions, inadequacy of warnings, and unintentional distribution of counterfeit products. In addition, product liability claims may be asserted against us with respect to any of the products we sell and as a distributor, we are required to pay for damages for any successful product liability claim against us, although we may have the right under applicable Hong Kong laws, rules and regulations to recover from the relevant manufacturer for compensation we paid to our customers in connection with a product liability claim. We may also be obligated to recall affected products. If we are found liable for product liability claims, we could be required to pay substantial monetary damages. Furthermore, even if we successfully defend ourselves against this type of claim, we could be required to spend significant management, financial and other resources, which could disrupt our business, and our reputation as well as our brand name may also suffer.

***We believe we were a passive foreign investment company for United States federal income tax purposes for our taxable year ended June 30, 2025; as a result, United States holders of our Ordinary Shares could be subject to adverse United States federal income tax consequences.***

A non-U.S. corporation will be classified as a passive foreign investment company (a "PFIC") for U.S. federal income tax purposes for any taxable year in which, after applying certain look-through rules, either:

● at least 75% of its gross income is passive income; or

● at least 50% of its assets (generally based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income.

For purposes of the above calculations, a non-U.S. corporation will be treated as owning its proportionate share of the assets and earning its proportionate share of the income of any other corporation in which it owns, directly or indirectly, 25% or more (by value) of the equity. Passive income generally includes dividends, interest, certain rents or royalties, foreign currency or other investment gains and certain other categories of income. Assets that produce or are held for the production of passive income generally include cash, even if held as working capital and other assets that may produce passive income. A separate determination must be made after the close of each taxable year as to whether we were a PFIC for that year.

Based on the composition of our income and assets for our taxable year ended June 30, 2025, we believe we were a PFIC for such taxable year due to the amount of interest income we received relative to other income we received during such taxable year. The application of the PFIC rules is subject to uncertainty, and the U.S. Internal Revenue Service (or "IRS") or a court may disagree with our determinations, including the manner in which we determine the value of our assets, the percentage of our assets that are passive assets and the classification of certain of our income as active or passive under the PFIC rules. Furthermore, the characterization of our assets as active or passive may depend in part on our current and intended future business plans, which are subject to change. In addition, the total value of our assets for PFIC testing purposes may be determined in part by reference to the market price of Ordinary Shares from time to time, which may fluctuate considerably. Therefore, there can be no assurance regarding our PFIC status for our prior taxable year, our current taxable year or for any future taxable year.

If we are a PFIC for any taxable year during which a United States person holds Ordinary Shares, certain adverse United States federal income tax consequences could apply to such United States person. See "Item 10. Additional Information—E. Taxation—Material U.S. Federal Income Tax Considerations—Passive Foreign Investment Company."

U.S. HOLDERS SHOULD CONSULT THEIR TAX ADVISERS ABOUT THE PFIC RULES, THE POTENTIAL APPLICABILITY OF THESE RULES TO THE COMPANY CURRENTLY AND IN THE FUTURE, AND THEIR FILING OBLIGATIONS IF THE COMPANY IS A PFIC.

***For as long as we are an emerging growth company, we will not be required to comply with certain reporting requirements, including those relating to accounting standards and disclosure about our executive compensation, that apply to other public companies.***

In April 2012, President Obama signed into law the JOBS Act. We are classified as an "emerging growth company" under the JOBS Act. For as long as we are an emerging growth company, which may be up to five full fiscal years, unlike other public companies, we will not be required to, among other things, (i) provide an auditor's attestation report on management's assessment of the effectiveness of our system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act, (ii) comply with any new requirements adopted by the PCAOB requiring mandatory audit firm rotation or a supplement to the auditor's report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer, (iii) provide certain disclosure regarding executive compensation required of larger public companies or (iv) hold nonbinding advisory votes on executive compensation. We will remain an emerging growth company for up to five years, although we will lose that status sooner if we have more than $1.235 billion of revenues in a fiscal year, become a "large accelerated filer" (having a market value of our Ordinary Shares held by non-affiliates of more than $700 million as of the last business day of our most recently completed second fiscal quarter), or issue more than $1.0 billion of non-convertible debt over a three-year period.

To the extent that we rely on any of the exemptions available to emerging growth companies, you will receive less information about our executive compensation and internal control over financial reporting than issuers that are not emerging growth companies. If some investors find our Ordinary Shares to be less attractive as a result, there may be a less active trading market for our Ordinary Shares and our share price may be more volatile.

***As a foreign private issuer, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from the Nasdaq Stock Market corporate governance listing standards. These practices may afford less protection to shareholders than they would enjoy if we complied fully with corporate governance listing standards.***

As a foreign private issuer, we are permitted to take advantage of certain provisions in the Nasdaq Stock listing rules that allow us to follow Cayman Islands law for certain governance matters. Certain corporate governance practices in the Cayman Islands may differ significantly from corporate governance listing standards as, except for general fiduciary duties and duties of care, Cayman Islands law has no corporate governance regime which prescribes specific corporate governance standards. Cayman Islands law does not impose a requirement that our board of directors consist of a majority of independent directors. Nor does Cayman Islands law impose specific requirements on the establishment of a compensation committee or nominating committee or nominating process. To the extent we choose to follow home country practice in the future, our shareholders may be afforded less protection than they otherwise would have under corporate governance listing standards applicable to U.S. domestic issuers.

***As a foreign private issuer, we are not subject to certain U.S. securities law disclosure requirements that apply to a domestic U.S. issuer, which may limit the information publicly available to our shareholders.***

As a foreign private issuer, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act and therefore there may be less publicly available information about us than if we were a U.S. domestic issuer. For example, we are not subject to the proxy rules in the United States and disclosure with respect to our annual general meetings will be governed by the Cayman Islands law requirements. In addition, our officers, directors and principal shareholders are exempt from the reporting and "short-swing" profit recovery provisions of Section 16 of the Exchange Act and the rules thereunder. Therefore, our shareholders may not know on a timely basis when our officers, directors and principal shareholders purchase or sell our Ordinary Shares.

***We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses.***

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As discussed above, we are a foreign private issuer, and therefore, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last business day of an issuer's most recently completed second fiscal quarter. We would lose our foreign private issuer status if, for example, more than 50% of our Ordinary Shares are directly or indirectly held by residents of the U.S. and we fail to meet additional requirements necessary to maintain our foreign private issuer status. If we lose our foreign private issuer status on this date, we will be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms, which are more detailed and extensive than the forms available to a foreign private issuer. We will also have to mandatorily comply with U.S. federal proxy requirements, and our officers, directors and principal shareholders will become subject to the short-swing profit disclosure and recovery provisions of Section 16 of the Exchange Act. In addition, we will lose our ability to rely upon exemptions from certain corporate governance requirements under the Nasdaq Stock Market listing rules. As a U.S. listed public company that is not a foreign private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private issuer, and accounting, reporting and other expenses in order to maintain a listing on a U.S. securities exchange.

***We do not intend to pay dividends for the foreseeable future.***

We currently intend to retain any future earnings to finance the operation and expansion of our business, and we do not expect to declare or pay any dividends in the foreseeable future. As a result, you may only receive a return on your investment in our Ordinary Shares if the market price of our Ordinary Shares increases.

***If we become directly subject to the scrutiny, criticism and negative publicity involving U.S.-listed Chinese companies, we may have to expend significant resources to investigate and resolve the matter which could harm our business operations, share price and reputation and could result in a loss of your investment in our Ordinary Shares, especially if such matter cannot be addressed and resolved favorably.***

U.S. public companies that have substantially all of their operations in China, including Hong Kong, have been the subject of intense scrutiny, criticism and negative publicity by investors, financial commentators and regulatory agencies, such as the SEC. Much of the scrutiny, criticism and negative publicity has centered around financial and accounting irregularities and mistakes, a lack of effective internal controls over financial accounting, inadequate corporate governance policies or a lack of adherence thereto and, in many cases, allegations of fraud. As a result of the scrutiny, criticism and negative publicity, the publicly traded stocks of many U.S. listed Chinese companies have sharply decreased in value and, in some cases, have become virtually worthless. Many of these companies are now subject to shareholder lawsuits and SEC enforcement actions and are conducting internal and external investigations into the allegations. It is not clear what effect this sector-wide scrutiny, criticism and negative publicity will have on our company, our business and our share price. If we become the subject of any unfavorable allegations, whether such allegations are proven to be true or untrue, we will have to expend significant resources to investigate such allegations and/or defend our company. This situation will be costly and time consuming and distract our management from growing our company.

***Our founder and CEO will continue to own a significant percentage of our Ordinary Shares and will be able to exert significant control over matters subject to shareholder approval.***

Mr. Yat-Gai Au, our founder, director and CEO, currently beneficially owns 88.6% of our company through Regencell (BVI) Limited and his spouse, and our company will continue to be controlled by him. Therefore, he has the ability to substantially influence us through this ownership position. For example, he may be able to control elections of directors, amendments of our organizational documents, or approval of any merger, sale of assets, or other major corporate transactions. His interests may not always coincide with our corporate interests or the interests of other shareholders, and he may act in a manner with which you may not agree or that may not be in the best interests of our other shareholders. So long as he continues to own a significant amount of our equity, he will continue to be able to strongly influence or effectively control our decisions.

***As a "controlled company" under the rules of the Nasdaq Capital Market, we may choose to exempt our company from certain corporate governance requirements that could have an adverse effect on our public shareholders.***

We are a "controlled company" as defined under the Nasdaq Stock Market listing rules because Mr. Yat-Gai Au, our founder, director and CEO, currently beneficially owns 88.6% of our Ordinary Shares through Regencell (BVI) Limited and his spouse. As long as our officers and directors, either individually or in the aggregate, own at least 50% of the voting power of our company, we are a "controlled company" as defined under Nasdaq Stock Market listing rules.

For so long as we are a controlled company under that definition, we are permitted to elect to rely, and may rely, on certain exemptions from corporate governance rules, including:

● an exemption from the rule that a majority of our board of directors must be independent directors;

● an exemption from the rule that the compensation of our CEO must be determined or recommended solely by independent directors; and

● an exemption from the rule that our director nominees must be selected or recommended solely by independent directors.

As a result, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements.

Although we do not intend to rely on the "controlled company" exemption under the Nasdaq Stock Market listing rules, we could elect to rely on this exemption in the future. If we elect to rely on the "controlled company" exemption, a majority of the members of our board of directors might not be independent directors and our nominating and corporate governance and compensation committees might not consist entirely of independent directors.

 **

***If securities or industry analysts do not publish research or reports about our business, or if they issue an adverse or misleading opinion regarding our shares, the price and trading volume of our Ordinary Shares could decline.***

 **

The trading market for our Ordinary Shares will be influenced by the research and reports that industry or securities analysts publish about us or our business. If no or few securities or industry analysts commence coverage of us, the trading price for our securities would be negatively impacted. In the event we obtain securities or industry analyst coverage, if any of the analysts who cover us issue an adverse or misleading opinion regarding us, our business model, our intellectual property or our share performance, or if our operating results fail to meet the expectations of analysts, the price of our securities would likely decline. If one or more of these analysts cease coverage of us or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause the price or trading volume of our Ordinary Shares to decline**.**

***Information available in public media that is published by third parties, including blogs, articles, message boards and social and other media may include statements not attributable to our company and may not be reliable or accurate.***

We have received, and may continue to receive, a high degree of media coverage that is published or otherwise disseminated by third parties, including blogs, articles, message boards and social and other media. This includes coverage that is not attributable to statements made by our directors, officers or employees. Investors should read carefully, evaluate and rely only on the information contained in this Annual Report, or any applicable filings with the SEC in determining whether to invest in our Ordinary Shares. Information provided by third parties may not be reliable or accurate and could materially impact the trading price of our Ordinary Shares which could cause losses to your investments.

**Risks Related to Doing Business in Hong Kong**

*Our company currently does not have any operations in mainland China. Accordingly, the laws and regulations of the PRC do not currently have any material impact on our business, financial condition and results of operations. However, if certain PRC laws and regulations were to become applicable to a company such as us in the future, the application of such laws and regulations may have a material adverse impact on our business, financial condition and results of operations and our ability to offer or continue to offer securities to investors, any of which may cause the value of our Ordinary Shares, to significantly decline or become worthless. See the following risk factors of "Our business, financial condition and results of operations, and/or the value of our Ordinary Shares or our ability to offer or continue to offer securities to investors may be materially and adversely affected to the extent the laws and regulations of the PRC become applicable to a company such as ours" and "The PRC government exerts substantial influence and discretion over the manner in which companies incorporated under the laws of PRC must conduct their business activities. We are a Hong Kong-based company with no operations in mainland China. However, if we were to become subject to such direct influence or discretion, it may result in a material change in our operations and/or the value of your Ordinary Shares, which would materially affect the interests of investors."*

***Political risks associated with conducting business in Hong Kong.***

Our operations are based in Hong Kong. Accordingly, our business operation and financial conditions will be affected by the political and legal developments in Hong Kong. During the period covered by the financial information incorporated by reference into and included in this Annual Report, we maintain substantially most of our operations in Hong Kong and, specifically, from Regencell Bioscience Limited. Any adverse economic, social and/or political conditions, material social unrest, strike, riot, civil disturbance or disobedience, as well as significant natural disasters, may affect the market which in turn may adversely affect the business operations of Regencell Bioscience Limited. Hong Kong is a special administrative region of the PRC and the basic policies of the PRC regarding Hong Kong are reflected in the Basic Law of the Hong Kong Special Administrative Region of the People's Republic of China (the "Hong Kong Basic Law" or the "Basic Law"), namely, Hong Kong's constitutional document, which provides Hong Kong with a high degree of autonomy and executive, legislative and independent judicial powers, including that of final adjudication under the principle of "one country, two systems." However, there is no assurance that there will not be any changes in the economic, political and legal environment in Hong Kong in the future. Since our operation is based in Hong Kong, any change of such political arrangements may pose immediate threat to the stability of the economy in Hong Kong, thereby directly and adversely affecting our results of operations and financial positions.

Under the Basic Law, Hong Kong is exclusively in charge of its internal affairs and external relations, while the government of the PRC is responsible for its foreign affairs and defense. As a separate customs territory, Hong Kong maintains and develops relations with foreign states and regions. Based on certain recent development including the Law of the People's Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region issued by the Standing Committee of the PRC National People's Congress in June 2020, the U.S. State Department has indicated that the United States no longer considers Hong Kong to have significant autonomy from China and President Trump signed an executive order and Hong Kong Autonomy Act ("HKAA") to remove Hong Kong's preferential trade status and to authorize the U.S. administration to impose blocking sanctions against individuals and entities who are determined to have materially contributed to the erosion of Hong Kong's autonomy. The United States may impose the same tariffs and other trade restrictions on exports from Hong Kong that it places on goods from mainland China. These and other recent actions may represent an escalation in political and trade tensions involving the U.S., China and Hong Kong, which could potentially harm our business.

Given the relatively small geographical size of Hong Kong, any of such incidents may have a widespread effect on our business operations, which could in turn adversely and materially affect our business, results of operations and financial condition. It is difficult to predict the full impact of the HKAA on Hong Kong and companies with operations in Hong Kong like us. Furthermore, legislative or administrative actions in respect of China-U.S. relations could cause investor uncertainty for affected issuers, including us, and the market price of our Ordinary Shares could be adversely affected.

***Because our business is conducted in Hong Kong dollars and the price of our Ordinary Shares is quoted in United States dollars, changes in currency conversion rates may affect the value of your investments.***

Our business is conducted in Hong Kong, our books and records are maintained in Hong Kong dollars, which is the currency of Hong Kong, and the financial statements that we file with the SEC and provide to our shareholders are presented in United States dollars. Changes in the exchange rate between Hong Kong dollar and U.S. dollar affect the value of our assets and the results of our operations in United States dollars. The value of Hong Kong dollar against United States dollar and other currencies may fluctuate and is affected by, among other things, changes in the Hong Kong's political and economic conditions and perceived changes in the economy of Hong Kong and the United States. Any significant revaluation of Hong Kong dollar may materially and adversely affect our cash flows, revenue and financial condition. Changes in the conversion rate between United States dollar and Hong Kong dollar will affect the amount of proceeds we will have available for our business.

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***Significant changes or developments in U.S. laws or policies, including changes in U.S. trade policies and tariffs and the reaction of other countries thereto, may have a material adverse effect on our business, results of operations, and financial condition.***

Significant changes or developments in U.S. laws and policies, such as laws and policies surrounding international trade, foreign affairs, manufacturing and development and investment in the territories and countries where we or our customers operate, can materially adversely affect our business, results of operations, and financial condition. The U.S. government has imposed (in certain cases, subject to deferral) significant tariffs on imports from certain jurisdictions and indicated the likely imposition of or significant increases in tariffs on goods imported into the United States from many other jurisdictions in the future, which could lead to corresponding punitive actions by the countries with which the U.S. trades. Any changes or potential changes in trade policies in the United States and the potential corresponding actions by other countries in which we do business could adversely and materially affect our business, results of operations, and financial condition.

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***Our business, financial condition and results of operations, and/or the value of our Ordinary Shares or our ability to offer or continue to offer securities to investors may be materially and adversely affected to the extent the laws and regulations of the PRC become applicable to a company such as ours.***

We currently do not have or intend to have any subsidiary or any contractual arrangement to establish a variable interest entity structure with any entity in mainland China, and we have direct ownership of our operating entities, Regencell Bioscience Limited and Regencell Limited in Hong Kong. However, as our principal executive offices are located, and we operate, in Hong Kong, a special administrative region of China, there is no guarantee that if certain existing or future laws of the PRC become applicable to a company such as us, it will not have a material adverse impact on our business, financial condition and results of operations and/or our ability to offer or continue to offer securities to investors, any of which may cause the value of such securities to significantly decline or be worthless.

Except for the Basic Law, the national laws of the PRC do not apply in Hong Kong unless they are listed in Annex III of the Basic Law and applied locally by promulgation or local legislation. National laws that may be listed in Annex III are currently limited under the Basic Law to those which fall within the scope of defense and foreign affairs as well as other matters outside the limits of the autonomy of Hong Kong. National laws and regulations relating to data protection, cybersecurity and anti-monopoly have not been listed in Annex III and so do not apply directly to Hong Kong.

The laws and regulations in the PRC are evolving, and their enactment timetable, interpretation and implementation involve significant uncertainties. To the extent any PRC laws and regulations become applicable to us, we may be subject to the risks and uncertainties associated with the legal system in the PRC, including with respect to the enforcement of laws and the possibility of changes of rules and regulations with little or no advance notice. We currently do not have plan to expand our operation or acquire any operation in the mainland China. However, we may also become subject to the laws and regulations of the PRC to the extent we commence business and customer facing operations in mainland China as a result of any future acquisition, expansion or organic growth.

***The PRC government exerts substantial influence and discretion over the manner in which companies incorporated under the laws of PRC must conduct their business activities. We are a Hong Kong-based company with no operations in mainland China. However, if we were to become subject to such direct influence or discretion, it may result in a material change in our operations and/or the value of our Ordinary Shares, which would materially affect the interest of the investors.***

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The PRC legal system is evolving rapidly and the PRC laws, regulations, and rules may change quickly with little advance notice. In particular, because these laws, rules and regulations are relatively new, and because of the limited number of published decisions and the non-precedential nature of these decisions, the interpretation of these laws, rules and regulations may contain inconsistences, the enforcement of which involves uncertainties. The PRC government has exercised and continues to exercise substantial control over many sectors of the PRC economy through regulation and/or state ownership. Government actions have had, and may continue to have, a significant effect on economic conditions in the PRC and businesses which are subject to such government actions.

We are a Hong Kong-based company with no operations in mainland China, and we have direct ownership of our operating entities, Regencell Bioscience Limited and Regencell Limited in Hong Kong. Our principal executive offices are located, and we operate, in Hong Kong, a special administrative region of China. The PRC government currently does not exert direct influence and discretion over the manner in which we conduct our business activities outside of mainland China, however, there is no guarantee that we will not be subject to such direct influence or discretion in the future due to changes in laws or other unforeseeable reasons or as a result of our future expansion or acquisition of operations in mainland China. See "— Our business, financial condition and results of operations, and/or the value of our Ordinary Shares or our ability to offer or continue to offer securities to investors may be materially and adversely affected to the extent the laws and regulations of the PRC become applicable to a company such as ours."

We currently do not have plan to expand our operation or acquire any operation in the mainland China. However, if we were to become subject to the direct intervention or influence of the PRC government at any time due to changes in laws or other unforeseeable reasons or as a result of our future development, expansion or acquisition of operations in the PRC, it may require a material change in our operations and/or result in increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply. In addition, the market prices of our Ordinary Shares could be adversely affected as a result of anticipated negative impacts of any such government actions, as well as negative investor sentiment towards Hong Kong-based companies subject to direct PRC government oversight and regulation, regardless of our actual operating performance. There can be no assurance that the PRC government would not intervene in or influence our operations at any time.

We were not required to obtain permission from the PRC government to list on a U.S. securities exchange, however there is no guarantee that this will continue to be the case in the future in relation to the continued listing of our securities on a securities exchange outside of the PRC, or even when such permission is obtained, it will not be subsequently denied or rescinded. Any actions by the PRC government to exert more oversight and control over offerings (including of businesses whose primary operations are in Hong Kong) that are conducted overseas and/or foreign investments in Hong Kong-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities, including our Ordinary Shares, to significantly decline or be worthless.

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***The enactment of Law of the PRC on Safeguarding National Security in the Hong Kong Special Administrative Region (the "Hong Kong National Security Law") could impact our Hong Kong holding subsidiary.***

On June 30, 2020, the Standing Committee of the PRC National People's Congress adopted the Hong Kong National Security Law. This law defines the duties and government bodies of the Hong Kong National Security Law for safeguarding national security and four categories of offences — secession, subversion, terrorist activities, and collusion with a foreign country or external elements to endanger national security — and their corresponding penalties. On July 14, 2020, the former U.S. President Donald Trump signed the HKAA into law, authorizing the U.S. administration to impose blocking sanctions against individuals and entities who are determined to have materially contributed to the erosion of Hong Kong's autonomy. On August 7, 2020 the U.S. government imposed HKAA-authorized sanctions on eleven individuals, including former HKSAR chief executive Carrie Lam. On October 14, 2020, the U.S. State Department submitted to relevant committees of Congress the report required under HKAA, identifying persons materially contributing to "the failure of the Government of China to meet its obligations under the Joint Declaration or the Basic Law." The HKAA further authorizes secondary sanctions, including the imposition of blocking sanctions, against foreign financial institutions that knowingly conduct a significant transaction with foreign persons sanctioned under this authority. The imposition of sanctions may directly affect the foreign financial institutions as well as any third parties or customers dealing with any foreign financial institution that is targeted. It is difficult to predict the full impact of the Hong Kong National Security Law and HKAA on Hong Kong and companies located in Hong Kong. If our Hong Kong subsidiary is determined to be in violation of the Hong Kong National Security Law or the HKAA by competent authorities, our business operations, financial position and results of operations could be materially and adversely affected.

***The Hong Kong legal system embodies uncertainties which could limit the availability of legal protections.***

As one of the conditions for the handover of the sovereignty of Hong Kong to China, China accepted conditions such as Hong Kong's Basic Law. The Basic Law ensured Hong Kong will retain its own currency (Hong Kong Dollar), legal system, parliamentary system and people's rights and freedom for fifty years from 1997. This agreement has given Hong Kong the freedom to function with a high degree of autonomy. The Special Administrative Region of Hong Kong is responsible for its own domestic affairs including, but not limited to, the judiciary and courts of last resort, immigration and customs, public finance, currencies and extradition. Hong Kong continues using the English common law system.

However, if the PRC attempts to alter its agreement to allow Hong Kong to function autonomously, this could potentially impact Hong Kong's common law legal system and may in turn bring about uncertainty in, for example, the enforcement of our contractual rights. This could, in turn, materially and adversely affect our business and operations. Additionally, intellectual property rights and confidentiality protections in Hong Kong may not be as effective as in the United States or other countries. Accordingly, we cannot predict the effect of future developments in the Hong Kong legal system, including the promulgation of new laws, changes to existing laws or the interpretation or enforcement thereof, or the preemption of local regulations by national laws. These uncertainties could limit the legal protections available to us, including our ability to enforce our agreements with our customers.

***Our Ordinary Shares may be prohibited from being trading on a national exchange under the Holding Foreign Companies Accountable Act if the PCAOB is unable to inspect our auditors located in Hong Kong. The delisting of our Ordinary Shares, or the threat of their being delisted, may materially and adversely affect the value of your investment.***

The Holding Foreign Companies Accountable Act (the "HFCAA") was enacted on December 18, 2020. The HFCAA states if the SEC determines that a company has filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit securities of any such company from being traded on a national securities exchange or in the over the counter trading market in the U.S.

On December 2, 2021, the SEC adopted final amendments to its rules implementing the HFCAA and established procedures to identify registrants and prohibit the trading of the securities of certain registrants as required by the HFCAA. On August 26, 2022, the PCAOB announced that it had signed a Statement of Protocol with the China Securities Regulatory Commission and the Ministry of Finance of the People's Republic of China, which the PCAOB believes represents the first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong completely, consistent with U.S. law. On December 15, 2022, the PCAOB removed mainland China and Hong Kong from the list of jurisdictions where it was unable to inspect or investigate completely registered public accounting firms. Each year, the PCAOB will determine whether it can inspect and investigate completely audit firms in mainland China and Hong Kong, among other jurisdictions. Whether the PCAOB will continue to be able to conduct inspections of PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong is subject to uncertainty and depends on a number of factors out of our and our auditor's control. If the PCAOB determines in the future that it no longer has full access to inspect and investigate completely accounting firms in mainland China and Hong Kong and we use an accounting firm headquartered in one of these jurisdictions to issue an audit report on our financial statements filed with the SEC, we would be identified as a Commission-Identified Issuer following the filing of the annual report on Form 20-F for the relevant fiscal year.

Our auditor, Marcum Asia CPAs LLP, the independent registered public accounting firm that issues the audit report included elsewhere in this Annual Report, as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, are subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess its compliance with the applicable professional standards. Marcum Asia CPAs LLP are currently subject to PCAOB inspections and PCAOB is able to inspect our auditor. However, we cannot assure you whether Nasdaq Stock Market LLC or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness of our auditor's audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach or experience as it relates to the audit of our financial statements. The SEC may propose additional rules or guidance that could impact us if our auditor is not subject to PCAOB inspection.

**Item 4. INFORMATION ON THE COMPANY**

A. <u>History and Development of the Company</u>

**Our Corporate History and Structure**

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We, Regencell Bioscience Holdings Limited, are a holding company incorporated as an exempted company on October 30, 2014, under the laws of the Cayman Islands, which has no substantive operations other than holding all of the issued and outstanding shares of Regencell Bioscience Limited, Regencell Limited and Regencell Bioscience North America Limited. Our principal executive offices are located at 9/F Chinachem Leighton Plaza, 29 Leighton Road, Causeway Bay, Hong Kong. Our telephone number at this address is +852 2155-0823. Our registered office in the Cayman Islands is at the offices of Ogier Global (Cayman) Limited, 89 Nexus Way, Camana Bay, Grand Cayman, KY1-9009, Cayman Islands. Our corporate website is https://www.regencellbioscience.com. The SEC maintains a website at www.sec.gov that contains reports, proxy statements and other information regarding us that file electronically with the SEC. Our annual reports and some of the other information submitted by us to the SEC may be accessed through this website.

On October 30, 2014, Mr. Yat-Gai Au, our founder, director and CEO, acquired 10,000 Ordinary Shares of Regencell Bioscience Holdings Limited in a private transaction. On September 28, 2020, Regencell (BVI) Limited, which was incorporated pursuant to the BVI Business Companies Act, 2004 on May 25, 2017, acquired all equity interests of Regencell Bioscience Holdings Limited from Mr. Yat-Gai Au. Mr. Yat-Gai Au has been the sole shareholder of Regencell (BVI) Limited since its inception. As a result, prior to the initial public offering of Regencell Bioscience Holdings Limited completed on July 20, 2021, Mr. Yat-Gai Au beneficially owned 100% of Regencell Bioscience Holdings Limited through Regencell (BVI) Limited.

We conduct our business through our wholly-owned subsidiaries, Regencell Bioscience Limited, a company incorporated in Hong Kong on May 12, 2015; Regencell Limited, a company incorporated in Hong Kong on November 20, 2014 and Regencell Bioscience North America Limited, a company incorporated in the British Virgin Islands on April 25, 2022. We are an early-stage bioscience company that focuses on research, development, and commercialization of TCM for the treatment of neurocognitive disorders and degeneration, specifically ADHD and ASD. Our goal is to save and improve the lives of patients, their families and caregivers and become a market leader for the best natural and holistic treatment globally.

Currently, we conduct research and development activities in the TCM industry through Regencell Bioscience Limited, which has entered into Strategic Partnership Agreements (defined below) and a Supplemental Agreement (defined below, and collectively with the Strategic Partnership Agreement, the "Partnership Agreements") with the TCM Practitioner.

Regencell Bioscience Holdings Limited owns 100% equity interest of Regencell Limited, which was incorporated in Hong Kong on November 20, 2014. Currently, Regencell Limited has no operation and is reserved for future expansion needs.

On May 31, 2021, we effectuated a share subdivision at a ratio of 1,000-for-1 to increase our authorized share capital from 100,000,000 ordinary shares with a par value of $0.01 per share to 100,000,000,000 ordinary shares with a par value of $0.00001 per share.

On September 2, 2021, our wholly-owned subsidiary, Regencell Bioscience Limited entered into a joint venture agreement with Honor Epic Enterprises Limited to form a joint venture, Regencell Bioscience Asia Limited, under the laws of Hong Kong. We have 60% equity interest in Regencell Bioscience Asia Limited. The joint venture ceased business on December 31, 2023 and deregistered on November 1, 2024. The disposition of the joint venture did not have a material impact on our ongoing results of operations of financial results.

On April 25, 2022, Regencell Bioscience North America Limited was incorporated in the British Virgin Islands. Regencell Bioscience North America Limited was wholly owned by us. Currently, Regencell Bioscience North America Limited has no operation and is reserved for future expansion needs.

On June 13, 2025, we, as an exempted company with limited liability incorporated under the laws of the Cayman Islands, capitalized an amount standing to the credit of the share premium account of the Company, and appropriated such sum and applied it on behalf of the shareholders towards paying in full (as to the full par value of $0.00001 per Ordinary Share) an aggregate of 481,476,042 Ordinary Shares (representing the receipt by each shareholder of the Company of 37 additional Ordinary Shares for every Ordinary Share held on the record date). This did not result in any changes in authorized share capital or par value of our Ordinary Shares, nor involve any cash outflow. This is treated as an equity reclassification of a 38-for-1 forward stock split under U.S. GAAP. The authorized share capital remained as $1,000,000 divided into 100,000,000,000 Ordinary Shares of $0.00001 par value each.

**Emerging Growth Company Status**

As a company with less than $1.235 billion in revenue during our last fiscal year, we qualify as an "emerging growth company" as defined in the JOBS Act enacted in April 2012, and may take advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not limited to:

● being permitted to present only two years of audited financial statements and only two years of related Management's Discussion and Analysis of Financial Condition and Results of Operations in our SEC filings;

● not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

● reduced disclosure obligations regarding executive compensation in periodic reports, proxy statements and registration statements; and

● exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

We may take advantage of these provisions until the last day of our fiscal year following the fifth anniversary of the date of the first sale of our common equity securities pursuant to an effective registration statement under the Securities Act of 1933, as amended (the "Securities Act"). However, if certain events occur before the end of such five-year period, including if we become a "large accelerated filer," our annual gross revenues exceed $1.235 billion or we issue more than $1.00 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company before the end of such five-year period.

In addition, Section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. We have elected to take advantage of the extended transition period for complying with new or revised accounting standards and acknowledge such election is irrevocable pursuant to Section 107 of the JOBS Act.

**Foreign Private Issuer Status** 

We are incorporated in the Cayman Islands, and more than 50 percent of our outstanding voting securities are not directly or indirectly held by residents of the United States. Therefore, we are a "foreign private issuer," as defined in Rule 405 under the Securities Act and Rule 3b-4(c) under the Exchange Act. As a result, we are not subject to the same requirements as U.S. domestic issuers. Under the Exchange Act, we will be subject to reporting obligations that, to some extent, are more lenient and less frequent than those of U.S. domestic reporting companies. For example, we will not be required to issue quarterly reports or proxy statements. We will not be required to disclose detailed individual executive compensation information. Furthermore, our directors and executive officers will not be required to report equity holdings under Section 16 of the Exchange Act and will not be subject to the insider short-swing profit disclosure and recovery regime.

**The Initial Public Offering**

On July 20, 2021, we completed the initial public offering of 87,400,000 (after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares, $0.00001 par value per share (the "IPO") at an offering price of $0.25 (after giving retroactive effect to the 38-for-1 forward stock split) per share, generating gross proceeds of approximately $21.85 million. On August 17, 2021, the underwriter of the IPO exercised its option to purchase 12,350,000 (after giving retroactive effect to the 38-for-1 forward stock split) additional Ordinary Shares of our company, par value $0.00001 per share, at a price of $0.25 (after giving retroactive effect to the 38-for-1 forward stock split) per share (the "Over-allotment Shares"). The closing of the sale of the Over-allotment Shares took place on August 19, 2021. The net proceeds of the IPO, including proceeds from the sale of Over-allotment Shares, totaled approximately $22.67 million, after deducting underwriting discounts and other related expenses.

**Public Offering Warrants**

In connection with and upon closing of the IPO and over-allotment on July 20, 2021 and August 19, 2021 respectively, we issued warrants equal to 2.5% of the shares issued in the IPO, totaling 57,500 units and 8,125 units, respectively, to the placement agents for the offering (the "warrants"). The warrants carry a term of five years, and shall not be exercisable for a period of 180 days from the closing of the IPO and shall be exercisable at a price equal to $0.28 (after giving retroactive effect to the 38-for-1 forward stock split) per share. All warrants were issued and exercised.

B. <u>Business Overview</u>

**Our Business Plan**

Our goal is to save and improve the lives of ADHD patients, ASD patients, their families and caregivers and become a market leader for the best natural and holistic treatment globally. The TCM Practitioner has been treating ADHD and ASD patients for over 30 years and we intend to commercialize the TCM formula utilized in his treatment first in Hong Kong and subsequently globalize the use of such TCM formula in order to address the unmet medical needs of the growing ADHD, ASD patient population in other countries such as the U.S. We aim to:

● show in a quantifiable and systematic way that the personalized TCM formula is effective for the treatment of ADHD and ASD in our first research study;

● file patent applications in Hong Kong and abroad;

● verify the effectiveness of the standardized TCM formula in our second efficacy trial;

● set up or establish partnerships and joint ventures for centralized production facilities to streamline our production and support our application for the approval and registration of our pCm;

● brand and commercialize our standardized TCM formula;

● expand to other locations globally; and

● conduct further research and development on the TCM formula for other applications.

We have completed our first research study with the TCM Practitioner and have standardized TCM formula candidate under development targeting ADHD and ASD patients. We also started our second efficacy trial using standardized TCM formula candidate in August 2021. We intend to conduct further investigation and research on the application of the TCM base formula for other neurological illnesses, disorders and degeneration. We will also commercialize our standardized TCM formula by building our own specialized sales and marketing organization initially in Hong Kong after obtaining necessary approvals from Hong Kong regulatory agencies.

**Our Market Overview and Opportunity**

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***ADHD Prevalence***

According to the Centers for Disease Control and Prevention ("CDC"), ADHD is one of the most common neurodevelopmental disorders of childhood. It is usually first diagnosed in childhood and often lasts into adulthood. Children with ADHD may have trouble paying attention, controlling impulsive behaviors, or being overly active. Normal symptoms of ADHD include: having short attention span, easily distracted, constantly fidgeting, excessive physical movement and little or no sense of danger. Some children may also have signs of anxiety, oppositional defiant and conduct disorder, depression and sleep problems.

According to a 2023 meta-analysis published in the *Italian Journal of Pediatrics* titled *"The global prevalence of ADHD in children and adolescents: a systematic review and meta-analysis*,*"* the global prevalence of ADHD is estimated at 7.6% among children aged 3–12 and 5.6% among adolescents aged 12-18. Based on current population estimates–1.4 billion children and 0.9 billion adolescents–this translates to approximately 157 million children and adolescents worldwide affected by ADHD within these age groups. According to 2025 projections extrapolated from the latest CDC Morbidity and Mortality Weekly Report (MMWR), approximately 404 million adults globally currently live with ADHD.

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***ASD Prevalence***

According to the CDC, ASD is a developmental disability characterized by repetitive and characteristic patterns of behavior and difficulties with social communications and interaction. The learning, thinking, and problem-solving abilities of people with ASD can range from gifted to severely challenged. These symptoms are present from early childhood and typically last a lifetime, affecting daily functions. The Diagnostic and Statistical Manual of Mental Disorders 5th Edition (DSM-5), published in 2013 includes Asperger syndrome, childhood disintegrative disorder, and pervasive developmental disorders not otherwise specified (PDD-NOS) as part of ASD rather than as separate disorders.

The World Health Organization (WHO) estimates that 1 in 100 children has ASD worldwide, or approximately 20 million to 23 million children affected by ASD. Based on findings from the Global Burden of Disease Study 2021, an estimated 61.8 million individuals, children and adults, were on the autism spectrum globally.

**Our Research and Competitive Strengths**

***Our TCM Practitioner***

We strategically partner with the TCM Practitioner, the father of Mr. Yat-Gai Au, our founder, director and CEO. Pursuant to the Strategic Partnership Agreement and the Supplemental Agreement (collectively, the Partnership Agreements) we have with the TCM Practitioner, we have exclusive rights and ownership of (1) all his TCM formula and (2) the intellectual property rights of the TCM formula, including research and development, trademark, copyright, patent and any other intellectual property rights in relation to the TCM formula that the TCM Practitioner develops. Pursuant to the Partnership Agreements, the TCM Practitioner is responsible for research and development of TCM formula for ADHD and ASD patients, however, any inventions, TCM formula, utilities, improvements, research, discoveries, designs, processes, methods of manufacture and products conceived or made by the TCM Practitioner in relation to his TCM research shall be the sole and exclusive property of us. To support the TCM Practitioner's continued research, we undertake to pay for all reasonable costs and expenses incurred by the TCM Practitioner in conducting research, testing, attending meetings/seminars, compiling records, or performing any similar acts in relation to the development of the TCM formula. In furtherance of our research, development and commercialization of TCM formula, we have direct supervision and control over the TCM Practitioner's TCM formula research pursuant to the Partnership Agreements. We have full discretion to assign, refine, update, or redesign the TCM Practitioner's research tasks from time-to-time pursuant to the Partnership Agreements.

The TCM Practitioner has been practicing TCM under the guidance of the HKCMO in his clinic in Hong Kong since 1999 and has accumulated in-depth experience of TCM research and clinical practice. For over 30 years the TCM Practitioner has focused his TCM study on TCM thesis of his father, who was a renowned TCM doctor in Hong Kong in the 1950s, and other traditional treatises of TCM. He is experienced in treating patients suffering from a wide range of neurocognitive disorders and degeneration. In particular, the TCM Practitioner has treated many children afflicted with ADHD and ASD during his practice. He has always been passionate about treating patients and giving back to society. He decided to dedicate all his efforts to treat people afflicted with incurable diseases, illnesses and disorders. Prior to starting his TCM clinical practice, the TCM Practitioner founded a successful technology and property business in California. The TCM Practitioner graduated from the University of California, Berkeley with Bachelor's and Master's Degrees in Electrical Engineering in Circuit Design and Network Theory. He was the pioneer who invented the prototype high-density recording drive on flexible media while working at IBM, which later became known as Iomega Corporation.

*Our Strategic Partnership with TCM Practitioner*

In January 2018, Regencell Bioscience Limited entered into a Deed of Rights Transfer, Strategic Partnership and Undertaking (the "Strategic Partnership Agreement") with the TCM Practitioner, the father of our CEO and director. Pursuant to the Strategic Partnership Agreement we have with TCM Practitioner, we have exclusive rights and ownership of (1) all his TCM formula and (2) the intellectual property rights of the TCM formula, including research and development, trademark, copyright, patent and any other intellectual property rights in relation to the TCM formula that the TCM Practitioner develops. Pursuant to Strategic Partnership Agreement, the TCM Practitioner is responsible for research and development of TCM formula, while, any inventions, TCM formula, utilities, improvements, research, discoveries, designs, processes, methods of manufacture and products conceived or made by the TCM Practitioner in relation to TCM shall be the sole and exclusive property of us.

Pursuant to the Strategic Partnership Agreement, in exchange for the rights, we are required to donate three percent (3.0%) of net revenue that Regencell Bioscience Limited generates in association with the use and/or commercialization of the TCM formula treatment to any charitable institutions and/or trusts of a public character anywhere in the world at the sole and absolute choice of the TCM Practitioner, or his assignee, and in such proportion at the sole and absolute discretion of the TCM Practitioner on a yearly basis. We also undertake to pay for all reasonable costs and expenses incurred by the TCM Practitioner in conducting research, testing, attending meetings/seminars, compiling records, or performing any similar acts in relation to the development of the TCM formula and TCM inventions.

On November 10, 2020, Regencell Bioscience Limited entered into a Supplemental Agreement of the Strategic Partnership Agreement (the "Supplemental Agreement") with the TCM Practitioner. Under the Supplemental Agreement, the TCM Practitioner shall provide his research by using his best endeavors on his TCM formula and TCM inventions under our direction and supervision. We have authorized the TCM Practitioner, his agents, subcontractors, development team, and affiliates to use TCM formula and TCM Inventions to conduct research. However, they shall not directly or indirectly publish, disseminate or otherwise disclose, deliver or make available to any third party any confidential information, without our prior written notice. The TCM Practitioner also shall not be directly or indirectly concerned with or engaged in or interested in any other business which is in any respect in competition with or similar to the TCM business conducted by our company for two years after the expiration or termination of the Supplemental Agreement.

We shall pay the TCM Practitioner for his expenses on his TCM research within 30 days upon the receipt of invoice. The Supplemental Agreement shall remain effective until the Strategic Partnership Agreement is terminated. We can terminate the Supplemental Agreement without cause without any indemnity or damages being due to TCM Practitioner with 30 days prior written notice.

***TCM Efficacy Trial and Standardized TCM Formula Candidate***

*TCM Efficacy Trial*

Seven (7) of the TCM Practitioner's patients in Hong Kong, who were clinically diagnosed with ADHD and/or ASD by their healthcare professionals at different levels of severity, voluntarily consented through their parents or guardians to participate in our first research study in November 2018 and March 2019. In the first research study, the TCM Practitioner treated the enrolled patients with the use of the personalized TCM formula. The personalized TCM formula was comprised of two formula components, a base formula and an adjustable formula targeting different severity of symptoms. The base TCM formula is the product of Sik-Kee Au TCM Brain Theory<sup>®</sup>, which is used to treat ADHD and ASD by the TCM Practitioner over his 30 years of practice. The adjustable formula is "personalized" to each patient for different severity of symptoms. The enrolled patients' ages ranged from five to twelve years old. Six of the enrolled patients completed a three-month treatment and one completed a two-month treatment. Under the treatment by the TCM Practitioner, the enrolled patients consumed liquid-based TCM twice a day, which was prepared based on personalized TCM formula by our TCM Practitioner, and temporarily stopped consuming any other medicines. All the enrolled patients and their parents were required to meet with the TCM Practitioner in his clinic weekly and provide regular reports to update the patients' symptoms and conditions by phone.

We used globally accepted assessment tools such as ATEC, GARS, VADRS and SNAP-IV-26, together with additional assessments, written observations, photos, videos and parent testimonials to track the enrolled patients' progress. Within three months of using our TCM formula, our research showed that the enrolled patients had attained better speech, communication, sociability, cognition and behavioral abilities. The enrolled patients using the personalized TCM formula prescribed by the TCM Practitioner also experienced better bowel movement, sweating and temporary fatigue as part of the improvement process.

*Standardized TCM Formula and Second Efficacy Trial*

The TCM Practitioner has standardized the adjustable formula into a fixed formula. As a result, we have a standardized TCM formula under development targeting ADHD and ASD patients, consisting of a standard base formula and a fixed adjusted formula. We started our second efficacy trial using the standardized TCM formula in August 2021.

The standardized TCM formula was developed on the premise of Sik-Kee Au TCM Brain Theory<sup>®</sup>, which explains why a healthy brain is essential in restoring the body's systems to normal from disorders and illnesses such as ADHD and ASD. The TCM brain theory is not recognized in general literature of TCM or elsewhere. However, the TCM Practitioner has prescribed the TCM base formula based on his TCM brain theory for over 30 years to treat ADHD, ASD and many neurological illnesses, disorders and degeneration, and obtained satisfactory clinical treatment results. Such clinical treatment results are not supported by controlled clinical data or trials. According to the TCM brain theory, the blockage of or reduced blood flow, and damage of the interconnecting central nervous system, endocrine system and blood circulatory system disrupt the production of hormones and transmission of neurotransmitters, such as melatonin, dopamine and norepinephrine, leading to a defective encoding and decoding of functions and resulting in deficient or abnormal social behaviors that are the hallmarks of ADHD and ASD. Our standardized TCM formula aims to address the fundamental cause of the disorders to achieve an optimal outcome compared to available stimulant and non-stimulant medications currently available in the market. The fundamental properties and treatment process of TCM are different from the mainstream stimulant and non-stimulant medications. TCM takes a holistic approach, using natural ingredients to treat different elements within the body. Every bodily function is taken into consideration when preparing the TCM formula for the patients so that the optimal results of the treatment could be reached. This explains the improvements in both their symptoms and overall health. As provided in the Partnership Agreements, we continue to work closely with the TCM Practitioner to include those treatments in our future development.

We seek to protect our standardized TCM formula, including the TCM base formula and the fixed adjusted TCM formula, and technology that we consider commercially important by filing patent applications in Hong Kong and abroad. In addition, we also rely on trade secrets or TCM related regulatory protection to protect our intellectual property. Our trade secrets and confidential information include unpatented know-how, technology and other proprietary information, to maintain our competitive position and to protect our TCM formula. We seek to protect these trade secrets and confidential information, in part, by entering into non-disclosure and confidentiality agreements with parties that have access to them. Further, we also rely on or intend to rely on our trademarks, trade names and brand names to distinguish our products from the products of our competitors, and have registered or will apply to register a number of these trademarks. We have received trademark certificates for "腦還原<sup>®</sup>" (directly translates as "brain restoration"), "RGC<sup>®</sup>", "RGC Regencell<sup>®</sup>" and "Sik-Kee Au TCM Brain Theory<sup>®</sup>" from the Hong Kong Registrar of Trade Marks.

*Second Efficacy Trial*

 

To further verify the standardized medicine efficacy, we worked with the TCM Practitioner on the second efficacy trial. A total of twenty-eight (28) patients in Hong Kong, who were clinically diagnosed with ADHD and/or ASD by their healthcare professionals at different levels of severity, voluntarily consented through their parents or guardians to participate in our second efficacy trial. Seven (7) of them started in August 2021 as the first group, fourteen (14) started in July 2022 as the second group and seven (7) started in October 2022 as the third group. In this second efficacy trial, the TCM Practitioner treated the enrolled patients with the use of the standardized TCM formula. The enrolled patients' ages ranged from five to thirteen years old. All enrolled patients completed a three-month treatment. Under the treatment by the TCM Practitioner, the enrolled patients consumed liquid-based TCM twice a day, which was prepared based on standardized TCM formula by our TCM Practitioner, and temporarily stopped consuming any other medicines. All the enrolled patients and their parents were required to meet with the TCM Practitioner in his clinic weekly and provide regular reports to update the patients' symptoms and conditions by phone. A summary of the interim report can be found on our website at https://www.regencellbioscience.com under patient case studies tab.

We used globally accepted assessment tools such as the ATEC and VADRS, together with in-house developed SKATBT-A<sup>3</sup>, and also written observations, photos, videos and parent testimonials to track the patients' progress. Within three months of using our TCM formula, our research showed that the patients had attained better speech, communication, sociability, cognition and behavioral abilities. Patients also experienced better sleep quality, improved appetite and improved bowel movement. Sweating and temporary fatigue are experienced as part of the improvement process.

**Industry and Market Background**

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***TCM Industry***

TCM has a long history in Hong Kong. The TCM industry in Hong Kong is regulated by the HKCMO, which was passed by the Legislative Council of Hong Kong in July 1999. The Chinese Medicine Council of Hong Kong, or the Council, is a statutory body established in September 1999 under the HKCMO. The Council is responsible for implementing regulatory measures for Chinese medicine. The Council implemented the licensing system of TCM traders and the registration system of pCm by phases. The role of TCM is now well established and the dispensation, storage and labeling of Chinese herbal medicines have been regulated since 2003. The safety, efficacy and quality of pCm will be assessed by the Hong Kong Chinese Medicines Board, which was established in 1999 under the HKCMO, before the products being allowed to be registered.

As of December 2023, there were 10,592 TCM practitioners in Hong Kong, compared with 16,180 doctors of western medicine. These TCM practitioners have an important role in contributing to Hong Kong's health care system. Since the supportive initiatives were launched by the Hong Kong Government in 1997, the TCM industry has grown into one of the main industries in the healthcare sector. According to the list of licensed Chinese medicines traders on the website of Chinese Medicine Council of Hong Kong, as of October 2024, there are over 8,000 TCM traders in Hong Kong.

The Hong Kong Government is committed to promoting TCM, and has implemented measures including creation of a network of institutions of high standing for research and development work, development of new drugs for enhancement of the competitiveness of the Chinese medicine industry, and setting up of research funds for the support of research in Chinese medicine. Under the Hong Kong Government's policy direction to promote the development of "evidence-based" TCM and out-patient TCM services in the public sector, as well as to provide training placements for local TCM degree graduates, the Hong Kong Hospital Authority was tasked to establish a total of 18 Chinese Medicine Centers for Training and Research ("CMCTRs") in each of the 18 districts of Hong Kong since 2003. In 2018, the total number of attendances at the 18 CMCTRs was about 1.2 million. In the 2018-19 Hong Kong Government Budget, a Chinese Medicine Development Fund of HK$500 million was set up to facilitate applied research and Chinese medicine specialization. In the 2023-24 Budget Speech, the Hong Kong Government announced plans to further inject HK$500 million into the Chinese Medicine Development Fund to strengthen the role of Chinese medicine in the primary healthcare system.

***Key Differences between Regulated Pharmaceutical Industry and TCM Industry in Hong Kong***

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Currently in Hong Kong, there are several U.S. Food and Drug Administration ("FDA") and Hong Kong Pharmacy and Poisons Board approved drugs available to treat ADHD and ASD symptoms that are manufactured by global pharmaceutical companies. However, we are a TCM bioscience company focusing on natural and holistic treatments and do not compete directly with those pharmaceutical companies. Although both pharmaceutical drugs and TCM are regulated by the Import and Export Ordinance (as defined below) and the Undesirable Medical Advertisements Ordinance, there are several key differences between the regulated pharmaceutical drug industry and the TCM industry in Hong Kong. For example, pharmaceutical drugs are principally regulated under the Pharmacy and Poisons Ordinance ("PPO") and the Antibiotics Ordinance and Dangerous Drugs Ordinance, while TCM is principally regulated by the HKCMO. Furthermore, all pharmaceutical manufacturers with manufacturing capability in Hong Kong must comply with the GMP in Hong Kong, whereas TCM manufacturers are not required to have GMP certifications. In terms of registration, pharmaceutical drugs sold in the Hong Kong market must be registered with the Hong Kong Pharmacy and Poisons Board, while pCm formula products are registered with the Hong Kong Chinese Medicines Board.

Based on research provided by Persistence Market Research, no large TCM companies are providing similar ADHD and ASD products in the Hong Kong market. As such, the TCM ADHD and ASD markets are highly fragmented and there is no large TCM competitor in our target market.

**Regulatory Approvals Prior to Commercialization in Hong Kong**

Subject to the outcome of further research and development, if we commercialize our TCM formula in Hong Kong, we will need to receive a manufacturer license issued by the Hong Kong Chinese Medicines Board. Once we receive the license and complete pCm registrations for our standardized TCM formula candidate, our standardized pCm formula products can be manufactured and sold over the counter without the supervision and prescription of a TCM practitioner in Hong Kong.

When applying for registration of pCm in Hong Kong, we will be required to provide sufficient documents to show the safety, stability, quality and efficacy of our pCm formula products to the Hong Kong Chinese Medicines Board. To show the efficacy of our pCm formula products, documents required include reference materials in which the claimed therapeutic functions are supported by research studies, interpretation and principle of formulating a prescription and a summary report on all the product efficacy documents. To prove the safety, stability and quality of our pCm formula products, we will work with accredited laboratories, a list of which is provided by the Hong Kong Chinese Medicines Board, to conduct all the necessary tests, such as heavy metals and toxic element test and pesticide residues test. As for the application of manufacturer license, the major documents required are a brief floor plan of the premise and a list of manufacturing equipment. GMP certification is not required for the manufacturing of pCm in Hong Kong.

**Competition and Competitive Advantages**

We are an early-stage bioscience company that focuses on research, development and commercialization of our standardized TCM formula for patients afflicted with neurocognitive disorders and degeneration, such as ADHD and ASD. There are two main types of medication for ADHD: stimulants such as Ritalin and Adderall and non-stimulants. For ASD, there are only two antipsychotic drugs approved by the FDA for treating irritability and aggression symptoms: risperidone and aripiprazole, according to Autism Speaks, an organization in the U.S. dedicated to promoting solutions, across the spectrum and throughout the life span.

***Competition***

Currently in Hong Kong, there are several drugs approved by the FDA and Hong Kong Pharmacy and Poisons Board available to treat ADHD and ASD that are manufactured by global pharmaceutical companies. However, we are a TCM bioscience company focusing on TCM treatments and do not compete directly with those pharmaceutical companies. Although both pharmaceutical drugs and TCM are regulated by the Import and Export Ordinance and the Undesirable Medical Advertisements Ordinance, there are several key differences between the regulated pharmaceutical drug industry and the TCM industry in Hong Kong. For example, pharmaceutical drugs are regulated under the PPO and the Antibiotics and Dangerous Drugs Ordinance, while TCM is regulated by the HKCMO. Furthermore, all pharmaceutical manufacturers in Hong Kong must comply with the GMP in Hong Kong, whereas TCM manufacturers are not required to have GMP certifications. In terms of registration, pharmaceutical drug must be registered with the Hong Kong Pharmacy and Poisons Board, while pCm formula products registered with the Hong Kong Chinese Medicines Board.

Most medicines prescribed to ease ADHD and ASD symptoms are used "off-label," meaning the medication is being used in a manner not specified in the FDA's approved packaging label, or insert. Such off-label use is common in virtually all areas of medicine and is usually done to relieve significant suffering in the absence of sufficiently large and targeted studies. Further, due to the complexity of ADHD and ASD, the existing medications approved by the FDA for ADHD and ASD are used to treat a specific symptom while the comorbid conditions remain present and will persist if no direct medications are available for treatment.

 

*ADHD Market Leaders*

According to Market Research Future (MRFR), the global ADHD therapeutics market comprises a host of key players. This list includes Eli Lilly and Company, Concordia International Corp., NEOS Therapeutics Inc., Highland Therapeutics Inc., Pfizer Inc., Novartis AG, Noven Pharmaceuticals Inc., Janssen Global Services LLC, Shire, Teva Pharmaceutical and others. However, we are a TCM bioscience company focusing on TCM holistic treatments and do not compete directly with those pharmaceutical companies.

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According to the ADHD Parents Medication Guide of the American Psychiatric Association, medication does not cure ADHD, but can alleviate the symptoms of ADHD when it is taken as prescribed. Ongoing care and treatment monitoring are important since those symptoms may come back once medication is halted.

Two main types of medication for ADHD approved by the FDA are stimulants and non-stimulants. Stimulants include methylphenidate and amphetamines. Non-stimulants which include atomoxetine and guanfacine, are alternatives for those who do not respond well to stimulants.

However, these two types of medication for ADHD have multiple side effects. Common side effects of stimulants include feeling restless and jittery, difficulty sleeping, loss of appetite, headaches, upset stomach, irritability, mood swings, depression, dizziness, racing heartbeat and tics. According to HelpGuide, an independently funded nonprofit organization in the U.S., these stimulant medications may also cause personality changes, such as becoming withdrawn, listless, rigid, or less spontaneous and talkative, others may develop obsessive-compulsive symptoms. Beyond the potential side effects, a number of safety concerns associated with the use of stimulant medications exist such as the effect on developing brain, heart-related problem, psychiatric problem and potential abuse, indicated by experts. Non-stimulants also have side effects including decreased appetite, nausea, vomiting, fatigue, indigestion, dizziness and mood swings.

*ASD Market Leaders*

According to Fortune Business Insights, players engaged in ASD drug therapy in the global market include AstraZeneca, Eli Lilly and Company, Fusion Autism Center, Pfizer Inc., Otsuka Holdings Co. Limited, and other prominent players. However, we do not compete with these players since they mainly focus on prescription or over the counter drugs while we focus on TCM. In addition, we will only consider expanding our market to other countries once we have successfully developed the Hong Kong market.

There are no medications that can cure ASD or treat the core symptoms, according to the CDC. However, there are medications that can help ASD patients with related symptoms like depression, anxiety, aggression, irritability, seizures, insomnia and trouble focusing and help them function better. Medicines for treating the three core symptoms of ASD, communication difficulties, social challenges and repetitive behavior, have long represented a huge area of unmet need. However, few drugs on the market today effectively relieve these symptoms and individual reaction to most commonly prescribed medicines can vary materially. Although the FDA has approved two antipsychotic drugs for treating irritability and aggression associated with autism (risperidone and aripiprazole), the prevalent behavioral problems associated with ASD have not been able to be improved by these medications.

Antidepressants are among the world's most widely prescribed medications for ASD patients, such as selective serotonin reuptake inhibitors (SSRIs), according to an article in Harvard Health Publishing. The range of their uses has expanded from depression to anxiety, obsessive-compulsive disorder, eating disorders and many other psychiatric conditions. Side effects include insomnia, skin rashes, headaches, joint and muscle pain, stomach upset, nausea, or diarrhea. Anticonvulsants are most commonly prescribed when the patient also suffers from epilepsy, as about one-third of autism patients do, however, common side effects include confusion, fever, hair loss, paranoia, impaired judgment and memory, anxiety and depression.

***Specialty of Our TCM Formula***

Our core competencies include the specialty of our TCM formula which is a natural and holistic treatment that may provide progressive improvement over time and is used specifically for ADHD and ASD. Our standardized TCM formula was created specifically to address this unmet need in the market. We will explore various ways to gain entry into markets and countries around the world and will research the regulatory and operational requirements as needed. Depending on the regulatory environment of each country, our product can be sold as either a drug or a dietary supplement, either directly by us or through partnerships and distributions. We will review and analyze all options to ensure feasibility to meet the demands of the respective markets.

Our TCM formula was created based on the Sik-Kee Au TCM Brain Theory<sup>®</sup>. The TCM brain theory is not recognized in general literature of TCM or elsewhere. However, the TCM Practitioner has prescribed the personalized TCM formula based on his TCM brain theory for over 30 years to treat ADHD, ASD and many neurological illnesses, disorders, degeneration and obtained satisfactory clinical treatment results. Such clinical treatment results are not supported by controlled clinical data or trials. Treatment using our personalized TCM formula has shown reduced severity in ADHD and ASD core symptoms in the first research study. The interim results of our second efficacy trial using the standardized TCM formula have shown to reduce ADHD and ASD symptoms, which further supports the efficacy of the TCM formula.

Existing ADHD and ASD medications on the market provide symptomatic relief, with various adverse side effects, such as, feeling restless and jittery, difficulty sleeping, loss of appetite, headaches, upset stomach, irritability, mood swings, depression, dizziness, racing heartbeat, tics, diarrhea and other stomach irritation, rashes, hives and itching, dry mouth, fatigue and weight loss. Some other side effects could be serious and some potentially fatal. Our standardized TCM formula targets to treat ADHD and ASD patients with fewer side effects. However, our standardized TCM formula has not been proven to be safe. We will conduct safety, quality and stability tests over our standardized TCM formula.

We believe treatment using our TCM formula can provide progressive improvements over time because it aims to correct the fundamental cause of diseases and disorders such as ADHD and ASD, whereas the effect of existing ADHD and ASD drugs wear off after a few hours. Short-acting stimulants peak after several hours and must be taken 2-3 times a day. Long-acting or extended-release stimulants last 8-12 hours and are usually taken just once a day, some patients may require an increase in dosage over time because the body builds up tolerance and resistance, according to HelpGuide, an independently funded nonprofit organization in the U.S.

All parents of the ADHD and ASD children in our efficacy trial have witnessed pronounced changes in their child's symptoms in three months and have testified the benefits and effectiveness of our TCM Practitioner's treatment and was preferred over their typical mainstream medication. During our study, all of the children stopped their existing medication and exclusively took our TMC treatment.

All our patients for both the first and second trial had sought other treatments and/or therapies prior to participating in our program. After the completion of our trial period, the parents were interviewed and asked to provide their evaluation of our TCM treatment versus other treatments, therapies or drugs. All of the parents advised us that they felt that their child's temper was more stable, that their child was more attentive and that their awareness of the environment was higher after treatment with our TCM formula.

Currently, according to the CDC, there is no cure for ADHD and ASD. Given the lack of effective conventional medicine, coupled with adverse side effects associated with current drugs and rapidly growing patient diagnosis, we are well-positioned to become the leader in providing the treatment for ADHD and ASD.

***TCM Practitioner with Practicing Experiences Over 30 Years***

Our TCM Practitioner has treated many children afflicted with ADHD and ASD and other patients suffering from a wide range of neurocognitive disorders and degeneration with the personalized TCM formula. However, the treatment results of our TCM Practitioner are not supported by any controlled clinical data or trials.

The TCM Practitioner has standardized the adjustable formula into a fixed formula. As a result, we have a standardized TCM formula under development targeting ADHD and ASD patients, consisting of a standard base formula and a fixed adjusted formula. Based on our TCM Practitioner's practicing experiences, we do not anticipate high bio-pharmaceutical research and development costs relating to chemical drugs. Average research and development to marketplace cost for a new medicine is nearly $4 billion, and can sometimes exceed $10 billion. In comparison, our research and development costs were only $0.95 million and $1.07 million for the years ended June 30, 2025 and 2024, respectively.

**Intellectual Property**

The TCM formula are core of our business operation and TCM research and development. We seek to protect our standardized TCM formula, including the TCM base formula and the fixed adjusted TCM formula, and technology that we consider commercially important by filing patent applications in Hong Kong and abroad. In addition, we also rely on trade secrets or TCM related regulatory protection to protect our intellectual property. Our trade secrets and confidential information include unpatented know-how, technology and other proprietary information, to maintain our competitive position and to protect our TCM formula. We seek to protect these trade secrets and confidential information, in part, by entering into non-disclosure and confidentiality agreements with parties that have access to them. Further, we also rely on or intend to rely on our trademarks, trade names and brand names to distinguish our products from the products of our competitors, and have registered or will apply to register a number of these trademarks. We received trademark certificates for "腦還原®" (directly translates as "brain restoration") and "RGC Regencell<sup>®</sup>" in July 2020, "RGC<sup>®</sup>" in March 2021; and "Sik-Kee Au TCM Brain Theory<sup>®</sup>" in September 2021 from the Hong Kong Registrar of Trade Marks.

**Regulatory Approvals Prior to Commercialization in Hong Kong**

Subject to the outcome of further research and development, if we commercialize our liquid-based standardized TCM formula in Hong Kong, we will need to receive a manufacturer license issued by the Hong Kong Chinese Medicines Board, which was established in 1999 under the HKCMO. Once we receive the licenses and complete pCm registrations for our standardized TCM formula candidate, our pCm formula products can be manufactured and sold over the counter without the supervision and prescription of a TCM practitioner in Hong Kong.

When applying for registration of pCm in Hong Kong, we will be required to provide sufficient documents to show safety, stability, quality and efficacy of our pCm formula products to the Hong Kong Chinese Medicines Board. To show the efficacy of our pCm formula products, documents required include reference materials in which the claimed therapeutic functions are supported by research studies, interpretation and principle of formulating a prescription and a summary report on all the product efficacy documents. To prove safety, stability and quality of our pCm formula products, we will work with accredited laboratories, a list of which is provided by the Hong Kong Chinese Medicines Board, to conduct all the necessary tests, such as heavy metals and toxic element test and pesticide residues test. As for the application of manufacturer licenses, the major documents required are a brief floor plan of the premise and a list of manufacturing equipment. GMP certification is not required for the manufacturing of pCm in Hong Kong.

Our current primary roles include recruiting and arranging patients to be treated by the TCM Practitioner, collecting research data from patients, conducting analysis over research data and planning for commercialization of our standardized TCM formula.

**Our Growth Strategy**

We are still a start-up company at an early stage and are committed to developing standardized TCM formula for ADHD and ASD patients. The growth of our business highly depends on our research and commercialization of our liquid-based standardized TCM formula. Currently, we aim to conduct research in the effectiveness and safety of our standardized TCM formula for ADHD and ASD patients and commercialize our liquid-based standardized TCM formula for ADHD and ASD patients in Hong Kong. After obtaining success of commercialization in the Hong Kong market, we may start to offer our pCm formula products to other markets.

***Show in a Quantifiable and Systematic Way that the Personalized TCM Formula is Effective for the Treatment of ADHD and ASD in Our First Research Study and Second Efficacy Trial***

We completed our first research study in 2019 and started our second efficacy study in August 2021. The findings indicate show that the TCM formula can reduce ADHD and ASD symptoms. Assessment scores for all participants in our studies showed a significant decrease, suggesting that their ADHD and ASD symptoms were less severe after three months of treatment. We are developing a standardized TCM formula aimed at ADHD and ASD patients, which includes a standard base formula and a fixed adjusted formula. Our second efficacy trial using this standardized TCM formula began in August 2021. A total of twenty-eight (28) patients in Hong Kong, clinically diagnosed with ADHD and/or ASD by their healthcare professionals at varying levels of severity, voluntarily consented through their parents or guardians to participate in this trial. Seven (7) participants started in August 2021 as the first group, fourteen (14) began in July 2022 as the second group, and seven (7) commenced in October 2022 as the third group. Interim results reveal that the VADRS total score decreased in twenty-two (22) participants, indicating less severe ADHD symptoms after three months of treatment with our standardized TCM formula. The VADRS total score remained unchanged in three (3) participants and increased in another three (3). The ATEC total score decreased for all participants except two (2), suggesting less severe ASD symptoms after three months of treatment. The SKATBT-A<sup>3</sup> total score of all participants in the interim results have reduced, except for one (1) whose score remained unchanged. Supplementary assessments also showed a reduction in symptom severity for all patients. We believe these results, which support the effectiveness of our standardized TCM formula, are significant.

***Engage Reputable and Leading Pharmaceutical or Healthcare Companies and Individuals in Next Trial***

 

Building on the success of our previous efficacy trials and to promote transparency, we aim to form partnerships with reputable and leading pharmaceutical or healthcare companies and entrepreneurs to accelerate our research and development efforts for our upcoming trial. These collaborations are anticipated to significantly enhance our clinical development in several ways:

● Technical expertise and infrastructure: We intend to partner with pharmaceutical companies to gain access to advanced clinical trial infrastructure, regulatory expertise, and specialized talent, which can greatly improve trial design, execution, and data integrity.

● Accelerated patient recruitment: Collaborating with healthcare partners who have extensive clinical networks can facilitate quicker and more diverse patient enrollment, enabling us to achieve statistically significant endpoints more efficiently.

● Data management and analytics: By leveraging our partners' capabilities in data capture, real-time monitoring, and bioinformatics, we can enhance the quality and speed of our trial insights, supporting more informed decision-making.

● Commercial foresight: Entrepreneurs and strategic partners with market-facing experience can assist in aligning our R&D with clinical needs, increasing market awareness, and strengthening mass-market adoption.

● Risk-sharing and capital efficiency: Co-developing or co-funding certain aspects of the trial with partners can help reduce financial risk and extend our resources while maintaining strategic control over our innovation.

 

***Integrate AI, Blockchain and Cryptocurrency to Create Synergies that Complement and Support Our Core Business***

 

● AI algorithms: These algorithms can analyze patterns in behavior, speech, and cognitive development, facilitating earlier detection and more accurate diagnoses of ADHD and ASD. This allows for timely interventions that can enhance quality of life.

● Blockchain technology: such technology can be utilized to store anonymized and decentralized patient treatment records, ensuring secure, tamper-proof, auditable, and privacy-respecting data, thereby safeguarding patient autonomy and trust.

● Cryptocurrency/token model: This model may incentivize patient engagement and foster a community that aligns with stakeholder values.

We believe that the synergy of these pillars will propel us toward achieving our primary goal of saving and improving lives. These pillars are currently at the concept planning stage, and there can be no assurance as to the timing or successful implementation of these initiatives, which remain subject to regulatory approvals, technical validation, availability of funding and other risks described in Item 3.D "Risk Factors." ****

***File Patent Applications in Hong Kong and Abroad***

In order to protect our intellectual properties, we intend to file patent applications for our TCM formula.

***Set Up Centralized Production Facilities***

To further reduce the manufacturing costs of our standardized TCM formula candidate, in anticipation of increased demand, and to support our application for approval and registration of our TCM formula products, we plan to establish or explore partnerships and joint ventures for a centralized production facility dedicated to the mass production of our standardized TCM formula.

***Brand and Commercialize Our Standardized TCM Formula***

We plan to develop and automate the process to enhance efficiency and scale the production of our pCm formula products. Additionally, we will design new packaging and labeling to comply with regulatory requirements and for branding purposes. We will ensure that these improvements in production and packaging do not compromise the effectiveness of our pCm formula products. Subsequently, we will apply for the necessary permits from Hong Kong regulatory agencies. Our intention is to expand our marketing efforts both locally and globally to achieve brand recognition and a favorable perception among consumers in our target markets. Specifically, we will build a marketing team to establish a strong image as a TCM company specializing in the treatment of ADHD and ASD. Our marketing strategy will target individuals affected by these disorders through advertisements on television, live radio stations, newspapers/magazines, online social media, banner advertising, and in-person marketing at various healthcare events and seminars.

***Expand to Other Locations Globally***

We will also consider expanding our market to other countries. Our plan is to market our pCm formula products in the U.S. and abroad after obtaining success of commercialization of our products in the Hong Kong market.

***Conduct Further R&D on TCM Base Formula for Other Application***

As the TCM base formula is developed based on Sik-Kee Au TCM Brain Theory<sup>®</sup>, we believe that his TCM base formula potentially has a wider application. We intend to conduct further investigation and research on the application of the TCM base formula for other applications for other neurological illnesses, disorders and degeneration.

**Our Products**

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***Product Overview***

Currently available drugs and treatments in the markets for ADHD and ASD aim to suppress or alleviate symptoms, whereas our TCM formula aim to treat the fundamental cause of neurocognitive disorders. Our TCM formula contains solely natural ingredients without any synthetic components. The liquid-based and orally administered TCM formula are currently personalized for each patient at different severities and symptoms of ADHD and ASD. According to Sik-Kee Au TCM Brain Theory<sup>®</sup>, when our TCM formula with their nutrients and medicinal properties are absorbed and circulated throughout the body, the TCM formula can perform the mechanism of removing deposits, clots and toxins that have been built up in the body over time and provide better blood circulation to bring sufficient blood supply to the brain. According to the TCM brain theory, with sufficient blood supply and circulation, the brain and organs will regenerate and as a result brain activities and organ functions are normalized, metabolism boosted and endocrine system regulated, thereby correcting the neurocognitive disorders and related symptoms such as attention deficit, hyperactivity, cognitive and social impairment. The TCM brain theory is not recognized in general literature of TCM or elsewhere. However, the TCM Practitioner has prescribed the formula based on his TCM brain theory for over 30 years to treat ADHD, ASD and many neurological illnesses, disorders and degeneration and obtained satisfactory clinical treatment results. Such clinical treatment results are not supported by controlled clinical data or trials.

Our TCM Practitioner prescribes the TCM formula under the guidance of TCM fundamental principles in conjunction with his TCM brain theory. Although each herb can be identified by its function in TCM terms, such as blood circulation, tonifying and qi-regulating herbs, the combination of herbs in each formula also demands our TCM Practitioner to skillfully apply TCM fundamental principles of compatibility to ensure the roles of each individual herb do not counteract with each other or become collectively harmful. The resulting combination creates synergetic pharmacological properties to treat neurological illnesses, disorders and degeneration that disrupted the normal neurological functions in ADHD and ASD patients. According to the assessment of our first efficacy trial, patients have better eye contact, daily excretion, appetite, longer sleep duration, communication, sociability, cognition, awareness and attentiveness, complexion, mood and temper.

The ingredients which our TCM Practitioner uses are all listed in the Pharmacopoeia of the People's Republic of China, tracing back to Compendium of Materia Medical, or Ben Cao Gang Mu (本草綱目), more than 400 years ago. All raw materials are sourced under the Hong Kong Chinese Medicine Regulatory Office guideline and are readily available in over 6,000 TCM stores, wholesalers, and other distribution channels in Hong Kong. Our TCM Practitioner carefully selects credible TCM herb vendors that have passed high standard TCM herb inspection. Some of the herbs include:

○ Blood circulation herbs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 桃仁 Taoren (Persicae Semen)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 紅花 Honghua (Carthami Flos)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 乳香 Ruxiang (Olibanum)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 沒藥 Moyao (Myrrha)

○ Tonifying herbs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 黃芪 Huangqi (Astragali Radix)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 地黃 Dihuang (Rehmanniae Radix)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 山茱萸 Shanzhuyu (Corni Fructus)

○ Qi regulating, heat and wind removing herbs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 荊芥 Jingjie (Schizonepetae Herba)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 防風 Fangfeng (Saposhnikoviae Radix)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 香附 Xiangfu (Cyperi Rhizoma)

○ Detoxication herbs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 海藻 Haizao, Algae (Sargassum)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 蒲公英 Pugongying (Taraxaci Herba)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 黃芩 Huangqin (Scutellariae Radix)

○ Blood clot removing herbs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 三七 Sanqi (Notoginseng Radix et Rhizoma)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 當歸 Danggui (Angelicae Sinensis Radix)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 川芎 Chuanxiong (Chuanxiong Rhizoma)

○ Digestion herbs:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 白朮 Baizhu (Atractylodis Macrocephalae
 Rhizoma)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 山楂 Shanzha (Crataegi Fructus)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;■ 雞內金 Jineijin (Galli Gigerii Endothelium
 Coreneum)

We intend to register our pCm formula products with the Hong Kong Chinese Medicines Board, upon successful completion of our second efficacy trial, under group II of the non-established medicines category, a category of pCm that does not contain any newly discovered Chinese herb, new medicinal part(s) of Chinese herb, active group extracted from Chinese herb or set of active groups extracted from compound prescription.

**Research and Development**

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***Our First Research Study in ADHD and ASD***

We have conducted an uncontrolled first research study, commenced in November 2018 and March 2019, to evaluate the effects of our personalized TCM formula on seven patients, who were from five to twelve years old and were clinically diagnosed with ADHD and/or ASD by their healthcare professionals at different levels of severity, by arranging them to be treated by the TCM Practitioner with the use of our personalized TCM formula for up to three months. We started our second efficacy trial using a standardized TCM formula in August 2021.

To minimize the impacts of patients' existing treatments to our assessment, four of the seven patients in our first research study had stopped their other medications for more than a year before they started receiving treatment using our personalized TCM formula and the other three stopped about a week before they started receiving treatment using our personalized TCM formula treatment in our study. Moreover, parents of the three patients in our first research study who stopped their medication only a week before our study had indicated that they had given those medications to their child only intermittently as needed, such as when attending class, because of the adverse side effects the child was experiencing. Parents also noted that the effect of the medication wore off after a few hours they have taken the medication and their condition would be the same as before they took the medication until they took another dose again.

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***Patient Voluntary Participation in the First Research Study***

Seven of the TCM Practitioner's patients in our first research study who were already diagnosed by a doctor or hospital with ADHD and/or ASD and age from five to twelve years old, voluntarily consented to provide their treatment data to us through their parents or guardians to participate in the first research study of the TCM Practitioner. Moreover, to isolate the treatment's effectiveness, the parents or primary caretakers must agree that the children patients would stop all other medical treatments, including both mainstream and Chinese medicine for the duration of the treatment process, which was expected to last for three months. Children who failed to meet all of the above conditions were not included in our research study.

The seven enrolled patients in our first research study consumed liquid-based TCM twice a day, which were prepared based on the personalized TCM formula by our TCM Practitioner and temporarily stopped consuming any other medicine. Six of the enrolled patients in our first research study completed a three-month treatment and one completed a two-month treatment. All the patients and their parents in our first research study were required to meet with the TCM Practitioner in his clinic weekly and provide regular reports to update the patients' symptoms and conditions by phone. Quantitative assessments were also conducted using globally accepted assessment tools, described in the following, together with additional qualitative assessments, written observations, photos, videos and parent testimonials to document their progress. Within three months of receiving treatment using our personalized TCM formula, our research showed that patients had attained better speech, communication, sociability, cognition and behavioral abilities. Their overall health had also improved. As part of the improvement process, patients also experienced better bowel movement, sweating and temporary fatigue, which were expected by our TCM Practitioner.

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***Assessment Methodology***

Each enrolled patient in our first research study stopped all his or her existing medical treatment for ADHD and/or ASD and was treated with a personalized TCM formula for a period up to three months. Patient's symptoms were assessed through parent interviews and using the globally accepted assessment tools, which were provided below. The parent's qualitative and quantitative assessment scores on the patient's behavior were compared before, during and after three months of treatment. The assessment tools used were the questionnaires filled in by the parents, which included (i) SKATBT-A<sup>3</sup>; (ii) ATEC; (iii) GARS; (iv) VADRS; and (v) SNAP-IV-26, which covered the first 26 items of the VADRS, for further analysis. The individual assessment method is explained in detail below. The assessment tools used in our research are globally recognized and accepted methods of scoring severity levels of ADHD and ASD patients.

The first research study was only the first phase of our research studies. Our uncontrolled first research study was designed with a small sample size to allow us to collect preliminary data, monitor the treatment progress, observe the effect of the treatment and note any adverse side effects in a cost-effective and systematic way. It has helped us better prepare for our second efficacy trial which started in August 2021. We intend to conduct further efficacy trials with a larger sample size using standardized TCM formula.

Although most of these are globally recognized assessment tools for the assessment of ADHD and ASD, the outcome of our efficacy trial may be subject to some biases of parents and caregivers of patients because we relied on the data provided by them, such biases may come from parental expectations, social desirability and recall bias. If our understanding and use of these assessment tools is flawed, or if the parents and caregivers of enrolled ADHD and ASD patients fail to observe and record accurately, then we will not only fail to realize any benefits from using these assessment tools, but may also be led to invest time and financial resources inefficiently in attempting to develop inappropriate TCM formula.

*Sik-Kee Au TCM Brain Theory<sup>®</sup> for ADHD/ASD Assessment* 

SKATBT-A<sup>3</sup> is a 48-item questionnaire developed by the research and development team of Regencell, designed to assess patients' conditions that are commonly observed by the TCM Practitioner. Items assessed are indications of patients' overall body and neurological conditions based on the TCM Practitioner's brain theory and his over 30 years of experience in treating ADHD and ASD patients. SKATBT-A<sup>3</sup> has a total score ranging from 0 to 122, the higher the score, the more problematic the symptoms. The severity of the patient's condition is categorized into three groups of equal total score range: mild (total score 0-40), moderate (total score 41-80) and severe (total score ≥ 81).

 

*Autism Treatment Evaluation Checklist* 

ATEC is specially designed to measure changes in autistic severity, making it useful in monitoring behaviors over time as well as tracking the efficacy of a treatment. ATEC comprises of four subscales: (1) Speech/Language/ Communication, (2) Sociability, (3) Sensory/Cognitive Awareness and (4) Health/Physical/Behavior. ATEC is a caregiver-administered questionnaire designed to measure changes in the severity of autism in response to treatment. The scores from each subscale are combined in order to calculate a Total Score. A lower score indicates a lower severity of autism symptoms and a higher score correlates with more severe symptoms of autism.

 

*Gilliam Autism Rating Scale* 

GARS is one of the most widely used instruments for the assessment of ASD in the world. It is a 42-item norm-referenced screening instrument used for the assessment of individuals ages 3-22 who have severe behavioral problems that may be indicative of autism. It gathers information about specific characteristics typically noted in children with ASD in three areas: stereotyped behaviors, communication and social interaction. It also contains a Developmental Disturbances section. As the questions included in the developmental disturbances section of GARS refer to the condition of the patient during the patient's first 36 months of age, the total score is calculated by adding the sum of the raw scores of the three subscales of stereotyped behaviors, communications and social interaction, but excluding the scores of developmental disturbances. A lower score indicates a lower severity of autism symptoms and a higher score correlates with more severe symptoms of autism.

*Vanderbilt ADHD Diagnostic Parent Rating Scale* 

VADRS is a psychological assessment tool for parents of children aged 6 to 12 designed to measure the severity of ADHD symptoms. Developed by Mark Wolraich at the Oklahoma Health Sciences Center, this rating scale also includes items related to other disorders which are frequently comorbid with ADHD. Similar to ATEC and GARS, a lower score indicates a lower severity of ADHD symptoms and a higher score correlates with more severe symptoms of ADHD.

 

 

*Swanson, Nolan, and Pelham (SNAP)-IV 26-item Parent Rating Scale*

SNAP-IV-26, which is an abbreviated version of the SNAP Questionnaire (Swanson, 1992; Swanson et al., 1983) and the same as the first 26 items of the VADRS, was also used. Items from the *DSM-IV* criteria for ADHD are included in the two subsets of symptoms: Inattentive (items 1 – 9) (score range from 0 – 27) and Hyperactivity/Impulsivity (items 10 – 18) (score range from 0 – 27). Also, items from the *DSM-IV* criteria for oppositional defiant disorder ("ODD") are included (items 19 – 26) (score range from 0 – 24) because ODD is often present in children with ADHD. The lower the SNAP-IV-26 score, the fewer the problems. The scores provide an interpretation for severe, moderate, mild and no clinically significant symptoms.

***Our Second Efficacy Trial in ADHD and ASD***

We commenced an uncontrolled second efficacy trial in August 2021, to evaluate the effects of our standardized TCM formula on ADHD and/or ASD patients by arranging them to be treated by the TCM Practitioner with the use of our standardized TCM formula for up to three months. Requirements for participants were the same as those in our first research study. A total of twenty-eight (28) patients in Hong Kong, who were clinically diagnosed with ADHD and/or ASD by their healthcare professionals at different levels of severity, voluntarily consented through their parents or guardians to participate in our second efficacy trial. Seven (7) of them started in August 2021 as the first group, fourteen (14) started in July 2022 as the second group and seven (7) started in October 2022 as the third group. The enrolled patients' ages ranged from five to thirteen years old. We intend to conduct further efficacy trials going forward.

Our second efficacy trial on the three groups of patients showed similar improvements in patients' symptoms. Within three months of receiving treatment using our standardized TCM formula, our research showed that patients had attained better speech, communication, sociability, cognition and behavioral abilities. Their overall health, sleep quality and appetite had also improved. As part of the improvement process, patients also experienced better bowel movement, sweating and temporary fatigue, which were expected by our TCM Practitioner. A summary of the interim report can be found on our website at https://www.regencellbioscience.com under patient case studies tab.

Since the last interim report from our second efficacy trial, we have carefully assessed alternative designs and methods for subsequent efficacy studies, explored tracking advancements in ADHD/ASD research with development of AI tools, investigated processes to expand recruitment strategies, reviewed advanced data and analytics systems and evaluated emerging technologies and collaborations that can enhance our development platform. In parallel, we continue to prioritize expanding core capabilities by strengthening our operational and scientific foundations to support the next phases of development. We believe these efforts position us to achieve meaningful progress as we advance our pipeline of TCM formulae candidates.

***Assessment Methodology***

Each enrolled patient in our second efficacy trial stopped all his or her existing medical treatment for ADHD and/or ASD and was treated with a standardized TCM formula for a period of three months. Patient's symptoms were assessed through parent interviews and using the globally accepted assessment tools, the ATEC and the VADRS questionnaire. We also adopted the SKATBT-A<sup>3</sup>, which is a 48-item questionnaire developed by the R&D team of Regencell Bioscience, designed to assess patients' conditions that are commonly observed by the TCM Practitioner. Items assessed are indications of patients' overall body and neurological conditions based on the TCM Practitioner's brain theory and his over 30 years of experience in treating ADHD and ASD patients. The ATEC and the VADRS questionnaire again as our assessment tools in our second efficacy trial. In addition, we had used additional assessment tools, which were also parents filled questionnaires, to obtain different measurements of patients' condition for evaluation. The parent's qualitative and quantitative assessment scores on the patient's behavior were compared before, during and after three months of treatment.

**Our Leases**

We currently maintain an office at 9<sup>th</sup> floor, Chinachem Leighton Plaza, 29 Leighton Road, Causeway Bay, Hong Kong. We entered a three-year fixed term lease agreement for the office space on August 9, 2021. The tenancy agreement was renewed during the year ended June 30, 2025 and commenced on August 2, 2024. The renewed lease was for 3 years term.

We also had an office at 11<sup>th</sup> Floor, First Commercial Building, 33-35 Leighton Road, Causeway Bay, Hong Kong. We entered a five-year fixed term lease agreement for the office space on July 15, 2019. The lease expired on July 14, 2024 and we did not renew the lease.

During the years ended June 30, 2025 and 2024, we entered into agreements to lease usage of office space and staff quarters with third parties. The leases were for a three-year term and two-year term respectively.

**Regulation Related to our Business Operation in Hong Kong**

The Legislative Council of Hong Kong, Chinese Medicines Council, Chinese Medicines Board and Chinese Medicines Regulatory Office of Department of Health of Hong Kong are independent and separate entities from China. Whilst Hong Kong is part of the PRC, Hong Kong and the PRC are regarded as two separate jurisdictions in law and markets. Under the "One Country, Two Systems," Hong Kong retains its own systems and way of life after the handover of sovereignty to the PRC in 1997. The Hong Kong Basic Law, being Hong Kong's constitutional document, gives legal effect to the "One Country, Two Systems" policy.

Pursuant to the Basic Law, the laws previously in force in Hong Kong, that is, the common law, rules of equity, ordinances, subordinate legislation and customary law shall be maintained, except for any that contravene the Basic Law, and subject to any amendment by the Legislative Council of Hong Kong. The socialist system and policies shall not be practiced in Hong Kong, and the previous capitalist system and way of life shall remain unchanged for 50 years. Further, Hong Kong residents and other persons in Hong Kong shall have the obligation to abide by the laws in force in Hong Kong.

As we operate in Hong Kong, we have no assets or operation in PRC, nor have plan to commence operation in PRC, we do not believe that PRC laws or regulations regarding the TCM industry apply to us. Hence, within Hong Kong's legal system, the laws and regulations of the PRC do not apply.

***Hong Kong Chinese Medicine Ordinance***

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The HKCMO provides licensing requirements for the sale and distribution of our TCM formula candidate, registration and licensing requirements of our Chinese healthcare products, and future operations of our Chinese medicine clinics in Hong Kong. The HKCMO was passed by the Legislative Council of Hong Kong on July 14, 1999. The HKCMO is not a PRC legislation but is a Hong Kong ordinance. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the HKCMO in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Food and Health Bureau, the Department of Health, etc., as well as the Chinese Medicine Council of Hong Kong, have the implementation rights of the HKCMO. The Chinese Medicine Council of Hong Kong is the main regulator of the HKCMO.

***Registration of TCM products and Chinese Healthcare Products***

Some of our TCM products and Chinese healthcare products are classified as proprietary Chinese medicine, defined below, and others are classified as non-pCm. The key differences between pCm and non-pCm lie on their ingredients, dosage forms and intended use. Under section 2 of the HKCMO, pCm is defined as any proprietary product, which is formulated in a finished dose form and is known or claimed to be used for the diagnosis, treatment, prevention or alleviation of any disease or any symptom of a disease in human beings, or for the regulation of the functional states of the human body, composed solely of (i) any Chinese herbal medicines; (ii) any materials of herbal, animal or mineral origin customarily used by the Chinese, which should be documented in Chinese medicine classics or bibliographies, including but not limited to Pharmacopeia; or (iii) any medicine and materials referred to above, which is formulated in a finished dose form and is generally known or claimed to be used for the diagnosis, treatment, prevention or alleviation of any disease or for the regulation of the functional states of human body.

Section 119 of the HKCMO provides that no person shall sell, import or possess any pCm unless the pCm is registered with the Chinese Medicines Board. Application for registration of a pCm shall be submitted to the Department of Health Chinese Medicines Board in the manner prescribed in section 121 of the HKCMO. Pursuant to section 120 of the HKCMO, the application for registration of any pCm shall be made by the manufacturer of the pCm manufactured in Hong Kong, or by the importer or local representative or agent of the manufacturer of pCm manufactured outside Hong Kong.

Any person who contravenes section 119 of the HKCMO commits an offense and is liable to a maximum fine of HK$100,000 and imprisonment for two years.

***Manufacture, Sale and Distribution of TCM Products and Chinese Healthcare Products***

The HKCMO provides that manufacturers and traders in pCm shall obtain a license issued by the Chinese Medicines Board. Section 131 of the HKCMO provides that no person shall manufacture any pCm, whether registered or not, without a manufacturer license, or at any place other than the premises specified in such license.

Any person who contravenes section 131 or 134 of the HKCMO commits an offense and is liable to a maximum fine of HK$100,000 and imprisonment for two years.

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***Labeling Requirements and Package Inserts for Chinese Healthcare Products***

The Chinese Medicines Regulation (as defined below) is not a PRC legislation but is a Hong Kong legislation. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the Chinese Medicines Regulation in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Food and Health Bureau, the Department of Health, etc., as well as the Chinese Medicine Council of Hong Kong, have the implementation rights of Chinese Medicines Regulation. The Chinese Medicine Council of Hong Kong is the main regulator of Chinese Medicines Regulation.

Sections 143 and 144 of the HKCMO provide that a pCm shall not be sold or possessed for the purpose of selling in Hong Kong unless the package of the product is labeled in the prescribed manner and contains a package insert which complies with the prescribed requirements. Pursuant to Regulations 26 and 28 of the Chinese Medicines Regulation (Chapter 549F of the Laws of Hong Kong) (the "Chinese Medicines Regulation"), all pCm shall be properly labeled and attached with package inserts. The label on a package of pCm shall include the following particulars: the name of the medicine; the name of each active ingredient used (if the pCm is composed of three or more kinds of active ingredients, the names of more than half of the active ingredients are required); the registration number on the certificate of registration; the holder of the registration certificate or the manufacturer (if the package is the outermost one, the name of the holder of the certificate of registration is necessary); the name of the country or territory in which the medicine is produced; the packing specification; dosage and method of usage; expiry date; and batch number. The package insert of the pCm shall include the following particulars: the name of the medicine; the name and quantity of each active ingredient used (if the pCm is composed of three or more kinds of active ingredients, the names and quantities of more than half of the active ingredients are required); the name of the holder of certificate of registration or the manufacturer; the dosage and method of usage; functions or pharmacological action; storage instructions; and packing specification. As for the indications, contra-indications, side effects, toxic effects and precautions, they should be included on the package insert as far as practicable.

Any person who contravenes section 143 or 144 of the HKCMO commits an offense and is liable to a maximum fine of HK$100,000 and imprisonment for two years.

***Food Safety Ordinance***

Food Safety Ordinance (Chapter 612 of the Laws of Hong Kong) (the "Food Safety Ordinance") establishes a registration scheme for food importers and food distributors, to require the keeping of records by persons who acquire, capture, import or supply food and to enable food import controls to be imposed. Food Safety Ordinance is not a PRC legislation but is a Hong Kong ordinance. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the Food Safety Ordinance in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Food and Health Bureau, the Food and Environmental Hygiene Department, etc., has the implementation rights of the Food Safety Ordinance. The Food and Environmental Hygiene Department is the main regulator of the Food Safety Ordinance. As some of our Chinese healthcare products which are non-pCm fall within the definition of food, our company is subject to the regulations under the Food Safety Ordinance.

Food Safety Ordinance may be applicable since we cannot determine whether the ultimate product(s) to be commercialized would be classified by the regulatory body as Chinese herbal medicines, healthcare products, food for ordinary consumption, or otherwise. The precise content of the standardized TCM formula candidate are subject to further changes and development along with our second efficacy trial. Accordingly, the precise ingredients of TCM products or product candidates will be determined at a later stage of our research and development.

***Registration as Food Importer or Distributor***

Sections 4 and 5 of the Food Safety Ordinance require any person who carries on a food importation business or food distribution business to register with the Food and Environmental Hygiene Department of Hong Kong as a food importer or food distributor. Any person who does not register but carries on a food importation or distribution business, without reasonable excuse, commits an offense and is liable to a maximum fine of HK$50,000 and imprisonment for six months.

***Record-keeping Requirement relating to Supply of Food***

Section 24 of the Food Safety Ordinance provides that a person who, in the course of business, supplies food in Hong Kong by wholesale must record the following information about the supply: (i) the date the food was supplied; (ii) the name and contact details of the person to whom the food was supplied; (iii) the total quantity of the food; and (iv) a description of the food. Such record shall be made under this section within 72 hours after the time the supply took place.

Any person, who fails to comply with the record-keeping requirement without reasonable excuse or knowingly or recklessly includes in the record information that is false in a material particular, commits an offense and is liable to a maximum fine of HK$10,000 and imprisonment for three months.

***Import and Export Ordinance***

The Import and Export Ordinance (Chapter 60 of the Laws of Hong Kong) (the "Import and Export Ordinance") is not a PRC legislation but is a Hong Kong ordinance. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the Import and Export Ordinance in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Customs and Excise Department, the Trade and Industry Department, etc., has the implementation rights of the Import and Export Ordinance. The Customs and Excise Department and the Trade and Industry Department are the main regulators of the Import and Export Ordinance.

Pursuant to sections 6C and 6D of the Import and Export Ordinance and Schedules 1 and 2 to the Import and Export (General) Regulations (Chapter 60A of the Laws of Hong Kong), any person who imports or exports any of the Chinese herbal medicines set out in Schedule 1 to the HKCMO and five specific types in Schedule 2 to the HKCMO (namely Flos Campsis (淩霄花), Processed Radix Aconiti (製川烏), Processed Radix Aconiti Kusnezoffii (製草烏), Radix Clematidis (威靈仙) and Radix Gentianae (龍膽)) as well as any pCm under the HKCMO shall apply for an import or export license.

Any person importing or exporting of the aforesaid Chinese herbal medicines and pCm without an import or export license commits an offense and is liable to a fine of HK$500,000 and imprisonment for two years, or on conviction on indictment to a fine of HK$2,000,000 and imprisonment for seven years.

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***Public Health and Municipal Services Ordinance***

The Public Health and Municipal Services Ordinance (Chapter 132 of the Laws of Hong Kong) (the "Public Health Ordinance") is not a PRC legislation but is a Hong Kong ordinance. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the Public Health Ordinance in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Food and Health Bureau, the Home Affairs Bureau, the Drainage Services Department, the Food and Environmental Hygiene Department, the Leisure and Cultural Services Department, the Department of Health, the Lands Department, the Buildings Department, etc., has the implementation rights of the Public Health Ordinance. The Food and Environmental Hygiene Department is the main regulator of the Public Health Ordinance.

The legal framework for food safety control in Hong Kong is set out in Part V of the Public Health Ordinance and the relevant sub-legislations thereunder. The Public Health Ordinance requires the manufacturers and sellers of food to ensure that their products are fit for human consumption and comply with the requirements in respect of food safety, food standards and labeling. As some of our Chinese healthcare products which are non-pCm fall within the definition of food, our company is subject to the regulations under the Public Health Ordinance.

Section 50 of the Public Health Ordinance prohibits the manufacture, advertising and sale in Hong Kong of food or drugs that are injurious to health. Any person who fails to comply with this section commits an offence and is liable to a maximum fine of HK$10,000 and imprisonment for three months.

Pursuant to section 52 of the Public Health Ordinance, subject to the statutory defenses set out under section 53 of the Public Health Ordinance, where a seller sells to the prejudice of a purchaser any food or drug which is not of the nature, substance or quality of the food or drug demanded by the purchaser, the seller commits an offense and is liable to a maximum fine of HK$10,000 and imprisonment for three months.

Pursuant to section 54 of the Public Health Ordinance, any person who sells or offers for sale any food intended for, but unfit for, human consumption, or any drug intended for use by human but unfit for the purpose, commits an offense and is liable to a maximum fine of HK$50,000 and imprisonment for six months.

Section 61(1) of the Public Health Ordinance provides that it shall be an offense for any person who gives with any food or drug sold by him/her or displays with any food or drug exhibited for sale by him/her any label which falsely describes the food or drug or is calculated to mislead as to its nature, substance or quality. Furthermore, pursuant to section 61(2) of the Public Health Ordinance, it shall be an offense if any person publishes or is a party to the publication of an advertisement falsely describing any food or drug or is likely to mislead as to the nature, substance or quality of any food or drug. Any person who commits an offense under this section is liable to a maximum fine of HK$50,000 and imprisonment for six months.

***Food and Drugs (Composition and Labelling) Regulations***

Food and Drugs (Composition and Labelling) Regulations (Chapter 132W of the Laws of Hong Kong) (the "Food and Drugs Regulations"), a subsidiary legislation under the Public Health Ordinance, regulates the advertising and labeling of food. Food and Drugs Regulations is not a PRC legislation but is a Hong Kong legislation. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the Food and Drugs Regulations in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Food and Environmental Hygiene Department, etc., has the implementation rights of the Food and Drugs Regulations. The Food and Environmental Hygiene Department is the main regulator of the Food and Drugs Regulations.

Regulation 3 of the Food and Drugs Regulations provides that the manufacturing of foods and drugs shall be up to the standards as specified under Schedule 1 to the Food and Drugs Regulations. Any person who advertises for sale, sells or manufactures for sale any food or drug which does not conform to the relevant requirements as to composition prescribed in Schedule 1 to the Food and Drugs Regulations commits an offense and is liable to a fine of HK$50,000 and imprisonment for six months.

Regulation 4A of the Food and Drugs Regulations demands all pre-packaged food and products sold by the Group (except for those listed in Schedule 4 to the Food and Drugs Regulations) to be marked and labeled in the manner prescribed in Schedule 3 to the Food and Drugs Regulations. Schedule 3 to the Food and Drugs Regulations contains labeling requirements in respect of stating the product's name or designation, ingredients, "best before" or "use by" date, special conditions for storage or instruction for use, manufacturer's or packer's name and address, and quantity, weight or volume, and also includes requirements on the appropriate language or languages for marking or labeling of prepackaged food. Any person who contravenes such requirements commits an offense and is liable for a fine of HK$50,000 and imprisonment for six months.

Pursuant to regulation 4B of the Food and Drugs Regulations, prepackaged food sold by the Group should be marked or labeled with its energy value and nutrient content in the manner prescribed in Part 1 of Schedule 5 to the Food and Drugs Regulations, and nutrition claims, if any, made on the label of the product or in any advertisement for the product should comply with Part 2 of Schedule 5 to the Food and Drugs Regulations. Contravention of those requirements may result in a conviction liable to a maximum fine of HK$50,000 and imprisonment for six months.

***Trade Marks Ordinance***

Trade Marks Ordinance (Chapter 559 of the Laws of Hong Kong) (the "Trade Marks Ordinance") provides for the registration of trademarks, the use of registered trademarks and related matters. As Hong Kong provides territorial protection for trademarks, trademarks registered in other countries or regions are not automatically entitled to protection in Hong Kong. In order to enjoy protection by the laws of Hong Kong, trademarks shall be registered with the Trade Marks Registry of the Intellectual Property Department under the Trade Marks Ordinance and the Trade Marks Rules (Chapter 599A of the Laws of Hong Kong) (the "Trade Marks Rules").

Trade Marks Ordinance is not a PRC legislation but is a Hong Kong ordinance. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the Trade Marks Ordinance in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Intellectual Property Department, etc., has the implementation rights of the Trade Marks Ordinance. The Intellectual Property Department is the main regulator of the Trade Marks Ordinance.

Section 10 of the Trade Marks Ordinance provides that a registered trademark is a property right acquired through due registration under the Trade Marks Ordinance, through which the owner of a registered trademark is entitled to the statutory rights provided thereunder.

By virtue of section 14 of the Trade Marks Ordinance, the owner of a registered trademark is conferred exclusive rights in the trademark. The rights of the owner in respect of the registered trademark come into existence from the date of the registration of the trademark. Pursuant to section 48 of the Trade Marks Ordinance, the registration date is the filing date of the application for registration.

Subject to the exceptions under sections 19 to 21 of the Trade Marks Ordinance, any use of the trademark by third parties without the consent of the owner is an infringement of the trademark. Section 18 of the Trade Marks Ordinance further specifies the conducts which amount to infringement of the registered trademark. In event that infringement by any third party occurs, the owner of the registered trademark is entitled to remedies under the Trade Marks Ordinance, such as infringement proceedings under sections 23 and 25 of the Trade Marks Ordinance.

Trademarks which are not registered under the Trade Marks Ordinance and the Trade Marks Rules may still be protected by the common law action of passing off, which requires proof of the owner's reputation in the unregistered trademark and that use of the trademark by third parties will cause damage to the owner.

***Sale of Goods Ordinance***

Sale of Goods Ordinance (Chapter 26 of the Laws of Hong Kong) (the "Sale of Goods Ordinance") provides, inter alia, that where a seller sells goods in the course of a business, there is an implied condition that (i) where the goods are purchased by description, the goods shall correspond with the description; (ii) the goods supplied are of merchantable quality; and (iii) the goods shall be fit for the purpose for which they are purchased. Otherwise, a buyer has the right to reject the defective goods unless he or she has a reasonable opportunity to examine the goods. A breach of the implied term may give rise to a civil action for breach of contract by the customers. However, no criminal liability arises from such breach of implied term.

Sale of Goods Ordinance is not a PRC legislation but is a Hong Kong ordinance. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the Sale of Goods Ordinance in accordance with the provisions of the Hong Kong Basic Law and legal procedures. As the Sale of Goods Ordinance only provides for civil courses of action, there is no regulator or implementer for this ordinance.

***Employment Ordinance (Chapter 57 of the Laws of Hong Kong)***

 

The Employment Ordinance (Chapter 57 of the Laws of Hong Kong) (the "Employment Ordinance") is an ordinance enacted for, amongst other things, the protection of the wages of employees and the regulation of the general conditions of employment and employment agencies. Employment Ordinance is not a PRC legislation but is Hong Kong ordinance. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the Employment Ordinance in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Labor Department, the Department of Health, the Labor Tribunal, etc., has the implementation rights of the Employment Ordinance. The Labor Department is the main regulator of the Employment Ordinance.

Under the Employment Ordinance, an employee is generally entitled to, amongst other things, notice of termination of his or her employment contract; payment in lieu of notice; maternity protection in the case of a pregnant employee; not less than one rest day in every period of seven days; severance payments or long service payments; sickness allowance; statutory holidays or alternative holidays; and paid annual leave of up to 15 days depending on the period of employment.

***Employees' Compensation Ordinance (Chapter 282 of the Laws of Hong Kong)***

The Employees' Compensation Ordinance (Chapter 282 of the Laws of Hong Kong) (the "ECO"), is an ordinance enacted for the purpose of providing for the payment of compensation to employees injured in the course of employment. The ECO is not a PRC legislation but is a Hong Kong ordinance. As with all other Hong Kong legislations, according to the laws of Hong Kong, the Legislative Council of Hong Kong has the power and function to amend the ECO in accordance with the provisions of the Hong Kong Basic Law and legal procedures. The Hong Kong Government, including but not limited to the Department of Justice, the Hong Kong Police Force, the Labor Department, the Department of Health, etc., has the implementation rights of the ECO. The Labor Department is the main regulator of the ECO.

As stipulated by the ECO, no employer shall employ any employee in any employment unless there is in force in relation to such employee a policy of insurance issued by an insurer for an amount not less than the applicable amount specified in the Fourth Schedule of the ECO in respect of the liability of the employer. According to the Fourth Schedule of the ECO, the insured amount shall be not less than HK$100,000,000 per event if a company has no more than 200 employees. Any employer who contravenes this requirement commits a criminal offense and is liable on conviction to a fine and imprisonment. An employer who has taken out an insurance policy under the ECO is required to display a prescribed notice of insurance in a conspicuous place on each of its premises where any employee is employed.

C. <u>Organizational Structure</u>

See "Item 4. Information on the Company – A. History and Development of the Company."

D. <u>Property, Plants and Equipment</u>

See "Item 4. Information on the Company – B. Business Overview – Our Leases."

**Item 4A. UNRESOLVED STAFF COMMENTS**

Not applicable.

**Item 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS**

*You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements and the related notes included elsewhere in this Annual Report on Form 20-F. This discussion 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.*

 

A. Operating Results

**Overview**

We are a holding company incorporated on October 30, 2014, under the laws of the Cayman Islands, and conduct our business in Hong Kong through our wholly-owned subsidiaries, Regencell Bioscience Limited, a company incorporated in Hong Kong on May 12, 2015, Regencell Limited, a company incorporated in Hong Kong on November 20, 2014, and Regencell Bioscience North America Limited, a company incorporated in the British Virgin Islands on April 25, 2022, and a 60% joint venture, Regencell Bioscience Asia Limited, a company incorporated in Hong Kong on September 17, 2021. Regencell Bioscience Asia Limited ceased business on December 31, 2023 and deregistered on November 1, 2024. The disposition of the joint venture did not have a material impact on our ongoing results of operations of financial results. We are an early-stage bioscience company that focuses on research, development, and commercialization of TCM for the treatment of neurocognitive disorders and degeneration, specifically ADHD and ASD. Our goal is to save and improve the lives of ADHD and ASD patients, their families and caregivers and become a market leader for the best natural and holistic treatment globally.

Our TCM formula is derived from a TCM formula developed by our TCM Practitioner based on his TCM brain theory, known as "Sik-Kee Au TCM Brain Theory<sup>®</sup>," and has demonstrated reduced severity in patients' ADHD and ASD conditions, as reflected in lower SKATBT-A<sup>3</sup>, ATEC, GARS, VADRS and SNAP-IV-26 assessment scores, using the personalized TCM formula in our first research study. The activity and specificity of the TCM base formula have been optimized by the TCM Practitioner in his prior ADHD and ASD treatments. The TCM Practitioner has standardized the adjustable formula into three Fixed Adjusted Formula for mild, moderate and severe ADHD and ASD conditions. Reduced severity in patients' ADHD and ASD conditions has also been demonstrated as reflected in lower SKATBT-A<sup>3</sup>, ATEC and VADRS assessment scores, using the standardized TCM formula in our second research study. The TCM brain theory is not recognized in general literature of TCM or elsewhere. However, the TCM Practitioner has prescribed the TCM formula based on his TCM brain theory for over 30 years to treat ADHD, ASD and many neurological illnesses, disorders and degeneration and obtained satisfactory clinical treatment results. Such clinical treatment results are not supported by controlled clinical data or trials.

We aim to launch a standardized liquid-based TCM formula for ADHD and ASD patients in Hong Kong first and subsequently to other markets as we deem appropriate. We have been headquartered in Hong Kong since inception.

***The Initial Public Offering***

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On July 20, 2021, we completed our IPO of 87,400,000 (after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares, $0.00001 par value per share at an offering price of $0.25 (after giving retroactive effect to the 38-for-1 forward stock split) per share, generating gross proceeds of approximately $21.85 million. On August 17, 2021, the underwriter of the IPO exercised its option to purchase 12,350,000 (after giving retroactive effect to the 38-for-1 forward stock split) additional Over-allotment Shares at a price of $0.25 (after giving retroactive effect to the 38-for-1 forward stock split) per share. The closing of the sale of the Over-allotment Shares took place on August 19, 2021. The net proceeds of the IPO, including proceeds from the sale of Over-allotment Shares, totaled approximately $22.67 million, after deducting underwriting discounts and other related expenses, of approximately of $2.26 million.

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***Public Offering Warrants***

In connection with and upon closing of the IPO and over-allotment on July 20, 2021 and August 19, 2021, respectively, we issued warrants equal to 2.5% of the shares issued in the IPO, totaling 57,500 units and 8,125 units to the placement agents for the offering. The warrants carry a term of five years, and shall not be exercisable for a period of 180 days from the closing of the IPO and shall be exercisable at a price equal to $0.28 per share (after giving retroactive effect to the 38-for-1 forward stock split). All warrants were issued and exercised.

**Financial Operations Overview**

***Revenue***

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We have not generated any revenue from the sale of any products, and we do not expect to generate any revenue until we commercialize our standardized TCM formula products for ADHD and ASD patients in Hong Kong.

***Selling and Marketing Expenses***

Expenses in marketing were mainly for marketing initiatives and sponsorship with Non-Governmental Organizations ("NGOs") and institutions that serves families with ADHD and ASD children, who voluntary sign up as qualified patients to be enrolled in our efficacy trial in the future. As we commercialize our TCM formula products, we expect that we would be hiring a sales and marketing team, engaging external sales and marketing professional services, and media coverage.

***General and Administrative Expenses***

General and administrative expenses consist primarily of salaries, compensation, legal and accounting fees, compliance fees as well as office rental, computer equipment and software, utilities, etc.

We anticipate that our general and administrative expenses will support our continued research and development activities and costs of operating as a public company. These increases will likely include increased costs related to the hiring of additional personnel and fees to outside consultants, lawyers and accountants, among other expenses. Additionally, we anticipate increased costs associated with being a public company including expenses related to investor relations costs.

***Research and Development Expenses***

Since our inception, our operations have primarily been limited to the research studies of the proprietary TCM formula. Our research and development expenses to date consist mainly of supplies and medication, employee salaries, compensation and related benefits, office rental and depreciation.

Research and development activities will continue to be central to our business model. Future research and development expenses will include supplies and medication and travel expenses for the research and development personnel that we plan to hire and treatment costs in connection with conducting research studies.

**Results of Operations**

***Results of Operations for the Years Ended June 30, 2025 and 2024***

The following table sets forth our results of operations for the year ended June 30, 2025 compared to the year ended June 30, 2024:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the<br> Year Ended**<br>**June 30,**<br>**2025** | **For the<br> Year Ended**<br>**June 30,**<br>**2024** |<br>**Change**<br>**Amount** |<br>**Change %** |
| **OPERATING EXPENSES:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Selling and marketing | $8014 | $125427 | $(117413) | (94)% |
| &nbsp;&nbsp;&nbsp;General and administrative | 2813682 | 3545066 | (731384) | (21)% |
| &nbsp;&nbsp;&nbsp;Research and development | 948289 | 1066233 | (117944) | (11)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 3769985 | 4736726 | (966741) | (20)% |
| **LOSS FROM OPERATIONS** | (3769985) | (4736726) | 966741 | (20)% |
| **OTHER INCOME, NET** | 185772 | 373505 | (187733) | (50)% |
| **LOSS BEFORE INCOME TAXES** | (3584213) | (4363221) | 779008 | (18)% |
| **PROVISION FOR INCOME TAXES** | - | - | - |  |
| **NET LOSSES** | (3584213) | (4363221) | 779008 | (18)% |
| **OTHER COMPREHENSIVE LOSS** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Foreign currency translation adjustment | (19020) | 40892 | (59912) | (147)% |
| **COMPREHENSIVE LOSS** | (3603233) | (4322329) | 719096 | (17)% |

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*Revenue*

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We have not generated any revenue from the sale of any products for the years ended June 30, 2025 and 2024, respectively.

*Selling and Marketing Expenses*

Selling and marketing expenses were $8.01 thousand and $0.13 million for the years ended June 30, 2025 and 2024, respectively. The expenses were primarily attributable to marketing initiatives and sponsorship with NGOs and institutions that serve families with ADHD and ASD children, who voluntarily sign up as qualified patients to be enrolled in our efficacy trial in the future during those periods.

The decreased expenses in selling and marketing expenses in the year ended June 30, 2025 compared with the year ended June 30, 2024 were mainly due to a decrease in the expenses through marketing initiatives.

 

*General and Administrative Expenses*

General and administrative expenses were $2.81 million and $3.55 million for the years ended June 30, 2025 and 2024, respectively, and were primarily attributable to employee salaries and related benefits, office rental, depreciation, legal, professional fees and consulting services associated with corporate matters and certain direct and indirect costs associated with services obtained by our company.

The decreased general and administrative expenses in the year ended June 30, 2025 compared with the year ended June 30, 2024 were mainly attributable to (i) approximately $0.28 million of decrease in amortization of share-based compensation for our general and administrative personnel, (ii) approximately $0.23 million of decrease in depreciation charges on our fixed assets as most of the items were fully depreciated during the year ended June 30, 2025, (iii) approximately $0.30 million of decrease in payroll mainly due to a decrease in bonus and the termination of a special advisor, (iv) approximately $0.21 million of net decrease in entertainment and donation and other expenses and offset by (v) increase in professional fees of $0.28 million as more professional fees were incurred.

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*Research and Development Expenses*

Research and development expenses were $0.95 million and $1.07 million for the years ended June 30, 2025 and 2024, respectively, and were primarily attributable to employee salaries and related benefits, office rental, depreciation, and other third-party services associated with efficacy trials.

The decreased research and development expenses in the year ended June 30, 2025 compared with the year ended June 30, 2024 were mainly attributable to approximately $0.12 million of decrease in rental expenses and building management fee for rental of office and staff quarters.

*Other Income, Net*

Other income, net was $0.19 million and $0.37 million for the years ended June 30, 2025 and 2024. The other income was primarily attributable to the interest income generated from short-term investment. The decrease in other income was mainly because approximately $0.18 million decrease in interest income received from short-term investment and bank deposits during the year ended June 30, 2025 when compared to the year ended June 30, 2024.

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*Provision for Income Taxes*

We did not have any provision for income taxes for the years ended June 30, 2025 and 2024.

*Net Losses*

As a result of the foregoing, we had net losses of $3.58 million and $4.36 million for the years ended June 30, 2025 and 2024, respectively.

***Results of Operations for the Years Ended June 30, 2024 and 2023***

The following table sets forth our results of operations for the year ended June 30, 2024 compared to that of the year ended June 30, 2023:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the<br> Year Ended**<br>**June 30,**<br>**2024** | **For the<br> Year Ended**<br>**June 30,**<br>**2023** |<br>**Change**<br>**Amount** |<br>**Change %** |
| **OPERATING EXPENSES:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Selling and marketing | $125427 | $262664 | $(137237) | (52)% |
| &nbsp;&nbsp;&nbsp;General and administrative | 3545066 | 4429379 | (884313) | (20)% |
| &nbsp;&nbsp;&nbsp;Research and development | 1066233 | 1581628 | (515395) | (33)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 4736726 | 6273671 | (1536945) | (24)% |
| **LOSS FROM OPERATIONS** | (4736726) | (6273671) | 1536945 | (24)% |
| **OTHER INCOME, NET** | 373505 | 211342 | 162163 | 77% |
| **LOSS BEFORE INCOME TAXES** | (4363221) | (6062329) | 1699108 | (28)% |
| **PROVISION FOR INCOME TAXES** | - | - | - |  |
| **NET LOSS** | (4363221) | (6062329) | 1699108 | (28)% |
| **OTHER COMPREHENSIVE LOSS** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Foreign currency translation adjustment | 40892 | (86658) | 127550 | (147)% |
| **COMPREHENSIVE LOSS** | (4322329) | (6148987) | 1826658 | (30)% |

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*Revenue*

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We have not generated any revenue from the sale of any products for the years ended June 30, 2024 and 2023, respectively.

*Selling and Marketing Expenses*

Selling and marketing expenses were $0.13 million and $0.26 million for the years ended June 30, 2024 and 2023, respectively. The expenses were primarily attributable to marketing initiatives and sponsorship with NGOs and institutions that serve families with ADHD and ASD children, who voluntarily sign up as qualified patients to be enrolled in our efficacy trial in the future during those periods.

The decreased expenses in selling and marketing expenses in the year ended June 30, 2024 compared with the year ended June 30, 2023 were mainly due to a decrease in the expenses through marketing initiatives.

 

*General and Administrative Expenses*

General and administrative expenses were $3.55 million and $4.43 million for the years ended June 30, 2024 and 2023, respectively, and were primarily attributable to employee salaries and related benefits, office rental, depreciation, legal, professional fees and consulting services associated with the formation of our company, corporate matters and certain direct and indirect costs associated with services obtained by our company.

The decreased general and administrative expenses in the year ended June 30, 2024 compared with the year ended June 30, 2023 were mainly attributable to (i) approximately $0.41 million of decrease in amortization of share-based compensation for our general and administrative personnel, (ii) approximately $0.22 million of decrease in professional fees, such as legal services and public relations services as we became a public company listed on the Nasdaq Capital Market, (iii) approximately $0.15 million of decrease in payroll mainly due to a decrease in bonus and the termination of a special advisor, and (iv) approximately $0.10 million of decrease in traveling, meetings and others mainly due to less traveling was incurred.

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*Research and Development Expenses*

Research and development expenses were $1.07 million and $1.58 million for the years ended June 30, 2024 and 2023, respectively, and were primarily attributable to employee salaries and related benefits, office rental, depreciation, and other third-party services associated with efficacy trials.

The decreased research and development expenses in the year ended June 30, 2024 compared with the year ended June 30, 2023 were mainly attributable to (i) approximately $0.06 million of decrease in amortization of share-based compensation for our research and development personnel; (ii) approximately $0.11 million of decrease in salaries due to the decrease in the bonus, (iii) approximately $0.25 million of decrease in expenses relating to TCM formula and materials for product development, (iv) approximately $0.06 million of decrease in rental expenses and building management fee for rental of office and staff quarters and (v) approximately $0.03 million of decrease in services fee for research support, testing equipment and others mainly due to more research and development activities incurred during the year.

*Other Income, Net*

Other income, net was $0.37 million and $0.21 million for the years ended June 30, 2024 and 2023. The other income was primarily attributable to the receipt of government grants in respect of COVID-19-related subsidies (for the year ended June 30, 2023 only), the Employment Support Scheme provided by the Hong Kong Government under the Anti-Epidemic Fund and the interest income generated from short-term investment. The increase in other income was mainly because approximately $0.16 million increase in interest income received from short-term investment and bank deposits during the year ended June 30, 2024 when compared to the year ended June 30, 2023.

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*Provision for Income Taxes*

We did not have any provision for income taxes for the years ended June 30, 2024 and 2023.

*Net Loss*

As a result of the foregoing, we had net loss of $4.36 million and $6.06 million for the years ended June 30, 2024 and 2023, respectively.

**Taxation**

***Cayman Islands***

We are incorporated in the Cayman Islands. Under the current laws of the Cayman Islands, we are not subject to income or capital gains taxes. Additionally, upon payments of dividends by us to our shareholders, no Cayman withhold tax will be imposed.

***British Virgin Islands***

Under the current laws of the British Virgin Islands, we are not subject to tax on income or capital gains

***Hong Kong Profits Taxation***

Our subsidiaries incorporated in Hong Kong were subject to 16.5% Hong Kong profits tax on their taxable income assessable profits generated from operations arising in or derived from Hong Kong for the year of assessment of 2023/2024 and 2024/2025. As from year of assessment of 2020/2021 onwards, Hong Kong profits tax rates are 8.25% on assessable profits up to HK$2,000,000, and 16.5% on any part of assessable profits over HK$2,000,000.

In December 2022, a refined Foreign-sourced Income Exemption ("FSIE") regime was published in Hong Kong and took effect from January 1, 2023. Under the new FSIE regime, certain foreign sourced income would be deemed as being sourced from Hong Kong and chargeable to Hong Kong Profits Tax, if the recipient entity fails to meet the prescribed exception requirements. Certain dividends, interests, disposal gains and intellectual property income, if any, received by us and our Hong Kong subsidiaries will be subject to the new tax regime. Based on our preliminary analysis, we do not believe this legislation will have a material impact on our financial statements. We will monitor the regulatory developments and continue to evaluate the impact, if any. In addition, payments of dividends from our Hong Kong subsidiary to us are not subject to any withholding tax in Hong Kong.

B. Liquidity and Capital Resources

In accordance with Accounting Standards Update ("ASU") 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern (Subtopic 205-40), we have evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about our ability to continue as a going concern within one year after the date that the consolidated financial statements are issued.

For the year ended June 30, 2025, we had net loss amounted to $3.58 million, as compared to $4.36 million in 2024 and net cash used in operating activities amounted to $3.11 million, as compared to $4.00 million in 2024. As of June 30, 2025, our accumulated deficit amounted to $25.20 million. Our ability to continue as a going concern is highly contingent on the ability to raise additional capital for ongoing research and development as we expect to continue to incur losses for the foreseeable future.

Based on our recurring losses and negative cash flows from operations since inception, expectation of continuing operating losses and negative cash flows from operations for the foreseeable future, the contractual costs expected to be incurred in future periods and the need to raise additional capital to finance our future operations, our management concluded that there is substantial doubt about our ability to continue as a going concern within one year after the issuance date of the consolidated financial statements.

We are evaluating several strategies and actively pursuing actions aimed at enhancing our liquidity position. These actions include pursuing additional cost savings initiatives and seeking additional financing in both public and private markets. There can be no assurances, however, that our operating plan will be achieved or that additional funding will be available on terms acceptable to us, or at all. If we are unable to obtain sufficient funding, we could be required to delay our development efforts, limit activities and reduce research and development costs, which could adversely affect our business prospects. Therefore, uncertainty remains over our ability to meet our liabilities as they fall due. If we cannot secure the financing needed to continue as a viable business, our shareholders may lose some of all of their investment in us.

The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Accordingly, the consolidated financial statements have been prepared on a basis that assumes we will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

**Cash Flows**

The following summarizes the key components of our cash flows for the years ended June 30, 2025, 2024 and 2023.

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| | | | |
|:---|:---|:---|:---|
|  | **For the Years Ended June 30,** | **For the Years Ended June 30,** | **For the Years Ended June 30,** |
|  | **2025** | **2024** | **2023** |
| Net cash used in operating activities | $(3113576) | $(4001687) | $(4962949) |
| Net cash provided by investing activities | 2686216 | 5242624 | 58978 |
| Net cash provided by financing activity |  | 102282 | 134913 |
| Effect of exchange rate on cash | (114760) | 53221 | (83145) |
| Net change in cash | $(542120) | $1396440 | $(4852203) |
| Cash, beginning of year | 2961235 | 1564795 | 6416998 |
| Cash, end of year | $2419115 | $2961235 | $1564795 |

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***Operating Activities***

*Fiscal Years Ended June 30, 2025 and 2024*

 

For the years ended June 30, 2025 and 2024, net cash used in operating activities were $3.11 million and $4.00 million, respectively. Net cash used in operating activities was primarily attributable to rental of offices and staff quarters, the hiring of our executive staff, research and development and general and administrative activities.

*Fiscal Years Ended June 30, 2024 and 2023*

For the years ended June 30, 2024 and 2023, net cash used in operating activities was $4.00 million and $4.96 million, respectively. Net cash used in operating activities was primarily attributable to rental of offices and staff quarters, the hiring of our executive staff, research and development, ramped up marketing efforts and general and administrative activities.

***Investing Activities***

*Fiscal Years Ended June 30, 2025 and 2024*

 

For the years ended June 30, 2025 and 2024, net cash provided by investing activities were $2.69 million and $5.24 million, respectively. Net cash provided by investing activities during the year ended June 30, 2025 was primarily attributable to the maturity of short-term investment and partially offset by reinvestment. The cash flows for proceeds from maturity of short-term investments and placements of short-term investments are shown in gross amounts as required by accounting standards. The increase in 2025 is mainly because short-term investments were made more frequently than in 2024, with similar amounts but shorter durations.

*Fiscal Years Ended June 30, 2024 and 2023*

For the years ended June 30, 2024 and 2023, net cash provided by investing activities were $5.24 million and $0.06 million, respectively. Net cash provided by investing activities during the year ended June 30, 2024 was primarily attributable to the maturity of short-term investment and partially offset by reinvestment.

***Financing Activity***

*Fiscal Years Ended June 30, 2025 and 2024*

 

For the year ended June 30, 2025, there was no financing activity occurred.

For the year ended June 30, 2024, net cash from financing activity was $0.10 million, which was primarily attributable to capital contribution from non-controlling interest of a subsidiary.

*Fiscal Years Ended June 30, 2024 and 2023*

For the years ended June 30, 2024 and 2023, net cash from financing activity were $0.10 million and $0.13 million, respectively. Net cash from financing activity was primarily attributable to capital contribution from non-controlling interest of subsidiary.

**Contractual Obligations**

The following table summarizes our minimum lease payments under operating lease in future periods as of June 30, 2025:

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| | |
|:---|:---|
|  | **As of<br> June 30,<br> 2025** |
| For the year ending June 30, |  |
| 2026 | $336364 |
| 2027 | 220313 |
| 2028 | 17669 |
| &nbsp;&nbsp;&nbsp;Total minimum lease payments | $574346 |

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**Capital Expenditures**

For the years ended June 30, 2025, 2024 and 2023, we had capital expenditures of $0.15 million, $5.38 thousand and $0.03 million, respectively, in relation to our property and equipment. Subsequent to June 30, 2025 and as of the date of this Annual Report, we did not purchase any material equipment for operational use. We do not have any other material commitments to capital expenditures as of June 30, 2025.

**Holding Company Structure**

Regencell Bioscience Holdings Limited is a holding company incorporated on October 30, 2014 as an exempted company under the laws of the Cayman Islands and has no substantive operations other than holding all of the issued and outstanding shares of our subsidiaries, namely Regencell Bioscience Limited incorporated in Hong Kong, Regencell Limited incorporated in Hong Kong and Regencell Bioscience North America Limited incorporated in the British Virgin Islands. We conduct our operations primarily through our subsidiaries. As a result, our ability to pay dividends depends upon, among others, dividends paid by our subsidiaries. If our subsidiaries or any newly formed subsidiaries incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us.

**Off-Balance Sheet Arrangements**

As of June 30, 2025, we did not have any off-balance sheet arrangements with unconsolidated entities or persons that had or were reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, cash requirements or capital resources; and we did not enter into any guarantees; retained or contingent interests in assets transferred; contractual arrangements that support the credit, liquidity or market risk for transferred assets; obligations that arise or could arise from variable interests held in an unconsolidated entity; or obligations related to derivative instruments that are both indexed to and classified in our own equity, or not reflected in the statement of financial position.

C. Research and Development, Patents and License, Etc.

Research and development expenses consist of costs incurred by our company for the discovery and development of our product candidates. Research and development costs include, but are not limited to, payroll and personnel expenses including share-based compensation, research studies supplies, fees for efficacy trial services, consulting costs, and allocated overhead, including rent, equipment, and utilities.

D. Trend Information

Other than as disclosed elsewhere in this Annual Report on Form 20-F, for the year ended June 30, 2025, we are not aware of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material effect on our net revenues, income from continuing operations, profitability, liquidity or capital resources, or that would cause reported financial information not necessarily to be indicative of future operating results or financial condition.

E. Critical Accounting Estimates

Critical accounting estimates are those estimates made in accordance with generally accepted accounting principles that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the financial condition or results of operations of the registrant.

***Share-based Compensation***

We measure all share option grants to our directors, executive officers and other employees based on their fair value on the date of the grant and recognize the corresponding compensation expense of those awards using graded vesting method over the requisite service period, which is the vesting period. Forfeitures are accounted for as they occur.

We classify share-based compensation expense in our statements of operations in the same way the award recipient's payroll costs are classified or in which the award recipient's service payments are classified.

We estimate the fair value of each share option grant using the Black Scholes Model and/or the Binomial Model, which involves key assumptions of expected volatility, risk-free interest rate, exercise multiples, expected dividend yield, life of options, and fair value of underlying ordinary shares.

For the years ended June 30, 2025, 2024 and 2023, the Company had share-based compensation expenses of approximately $0.24 million, $0.45 million, and $0.92 million, respectively. See Note 8 to our audited financial statements included elsewhere in this Annual Report for further information concerning the assumptions we used in determining share-based compensation.

**Recent Accounting Pronouncements**

See "Note 3 – Summary of significant accounting policies – Recently issued accounting pronouncements" in the accompanying notes to consolidated financial statements included elsewhere in this Annual Report.

We are an "emerging growth company" as defined under the federal securities laws and, as such, will be subject to reduced public company reporting requirements. Section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. We have elected to take advantage of the extended transition period for complying with new or revised accounting standards and acknowledge such election is irrevocable pursuant to Section 107 of the JOBS Act. As a result of our election, our financial statements may not be comparable to those of companies that comply with public company effective dates.

**Safe Harbor**

This Annual Report on Form 20-F contains forward-looking statements. These statements are made under the "safe harbor" provisions of Section 21E of the Exchange Act. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "may," "intend," "is currently reviewing," "it is possible," "subject to" and similar statements. Among other things, the sections titled "Item 3. Key Information—D. Risk Factors," "Item 4. Information on the Company," and "Item 5. Operating and Financial Review and Prospects" in this Annual Report on Form 20-F, as well as our strategic and operational plans, contain forward-looking statements. We may also make written or oral forward-looking statements in our filings with the SEC, in our Annual Report to shareholders, in press releases and other written materials and in oral statements made by our officers, directors or employees to third parties. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements and are subject to change, and such change may be material and may have a material and adverse effect on our financial condition and results of operations for one or more prior periods. Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained, either expressly or impliedly, in any of the forward-looking statements in this Annual Report on Form 20-F. All information provided in this Annual Report on Form 20-F and in the exhibits is as of the date of this Annual Report on Form 20-F, and we do not undertake any obligation to update any such information, except as required under applicable law.

**Item 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES**

A. <u>Directors and Senior Management</u>

**Directors and Executive Officers**

The following table sets forth our executive officers and directors as of the date hereof, as well as their ages and the positions held by them:

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position** |
| Yat-Gai Au | 53 | Chairman, Director and Chief Executive Officer |
| James Wai Hong Chung | 48 | Director, Chief Operating Officer and Chief Strategy Officer |
| Yat-Pui Au | 51 | Chief Business Officer |
| Evana Yee Wah Hui <sup>(1)</sup> | 53 | Independent Director |
| Margaret Hoor Han Lo <sup>(2)</sup> | 65 | Independent Director |
| Dr. Wing Yan (William) Lo <sup>(3)</sup> | 64 | Independent Director |

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(1) Chair of the Compensation Committee.

(2) Chair of the Nominating and Corporate Governance Committee.

(3) Chair of the Audit Committee.

The following is a brief biography of each of our executive officers and directors:

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***Yat-Gai Au***

Mr. Yat-Gai Au ("Mr. Au") is our Chief Executive Officer and has been our director since 2014. He began his career in investment banking at Deutsche Bank and ING Barings and was one of the core team members that won Merger and Acquisitions deal of the year awards in Asia from 1998 to 1999 comprising over $4 billion worth of deals. He is an active property, technology and biotech investor. He funds and participates in several charity events for thousands of underprivileged families and elderlies in Hong Kong and the U.S. During the COVID-19 outbreak, he donated over 200,000 masks to hospitals, elderlies and needy families. In September 2018, Mr. Au set up Regencell Foundation Limited to further his charitable endeavors. Mr. Au is the son of our TCM Practitioner, Mr. Sik-Kee Au. Mr. Au graduated from University of California, Berkeley with a Bachelor of Science degree from the Haas School of Business.

***James Wai Hong Chung***

Mr. James Wai Hong Chung ("Mr. Chung") has been our director since December 28, 2023, our Chief Operating Officer ("COO") since August 2021 and Chief Strategy Officer since October 2020. He has joined Regencell Bioscience Limited as senior vice president since July 2015. He brings 15 years of experience in various leading roles. Prior to joining Regencell, Mr. Chung managed the Asia equities and derivatives electronic trading platform at Investment Technology Group, where he gained extensive banking and finance experience. Prior to that, he worked at Sungard Financial Systems, providing front to back trading and risk management software solutions for banks. He also gained experiences in different roles from sales and accounting management, project management, technology and business analyst when he worked at a startup hedge fund IT consulting business. Mr. Chung started his career as a telecommunication engineer at Hutchison Global Crossing and eventually led a small team of engineers. Mr. Chung is a graduate of Quantitative Finance from the Management Science and Engineering Department at Stanford University and Telecommunications Technology from British Columbia Institute of Technology.

***Yat-Pui Au***

Mr. Yat-Pui Au has been our Chief Business Officer ("CBO") since February 2023. He has joined Regencell Bioscience Limited as senior vice president since October 2021. He has more than 24 years of experience in strategic management and business operations. Prior to joining Regencell, he worked at various leading roles in the physical security and property management sectors, where he implemented digital and cloud-based Customer Relationship Management solutions, completed major technology projects for governmental/institutional/private sectors, and streamlined business operations across marketing, finance, IT, HR and operations departments. Mr. Yat-Pui Au started his career as a consultant analyst for Computer Sciences Corporation for IT/MIS integrations and deployment. Mr. Yat-Pui Au is Mr. Au's brother. He obtained his Bachelor's degree in Legal Studies from UC Berkeley.

 ****

 ****

***Evana Yee Wah Hui***

Ms. Evana Yee Wah Hui ("Ms. Hui") has been our independent director and member of audit committee, compensation committee and nominating and corporate governance committee since July 2021. She has over 20 years of retail and brand management experience. Throughout her 18-year career at the Dairy Farm Company Limited, a leading pan-Asian retailer, she managed various segments of the business both at the regional and local level. She headed the regional category development team of the Health& Baby categories across the Greater China and Asian regions covering nine markets, implementing store layout/display, category development and management strategies. Furthermore, she was responsible for the sales and profitability of a diverse range of categories with experience in product creation and development, brand building, and customer loyalty. She also spearheaded the launch of both the GNC and Boots brands in Hong Kong. Prior to that, she spent three years developing and implementing market research at Nielsen, where her major clients included Unilever, Coca-Cola, HSBC, MSD, and L'Oreal. Ms. Hui participated in charitable endeavors, such as promoting mental health awareness in the community and holding workshops to promote self-awareness and reduce stigma in local high schools, co-organized by the Hong Kong Hospital Authority. She holds an MBA from University of Southern California and graduated with a Bachelor of Arts, Mathematics (Honors) from Mills College.

 ****

***Margaret Hoor Han Lo***

Ms. Margaret Hoor Han Lo has been our independent director and member of audit committee, compensation committee and nominating and corporate governance committee since June 2025. Ms. Lo is a seasoned investor with over 30 years of extensive experience in the real estate investments. She is also deeply committed to philanthropy, actively participating in various charitable initiatives and volunteer work.

***Dr. Wing Yan (William) Lo***

Dr. Wing Yan (William) Lo ("Dr. Lo") has been our independent director and member of audit committee, compensation committee and nominating and corporate governance committee since December 2021. He has over three decades of biopharma, academic medicine, corporate governance, and strategic advisory experience. Dr. Lo graduated from Cambridge University with a Master of Philosophy Degree in Pharmacology and a Ph.D. Degree in Molecular Neuroscience. Dr. Lo started his career in McKinsey & Company Inc. as a management consultant and held senior positions in China Unicom, Hongkong Telecom, Citibank HK, I.T Limited, South China Media Group and Kidsland International Holdings Limited in the past. Dr. Lo currently serves as an independent non-executive director of a number of public companies listed on the Main Board of The Stock Exchange of Hong Kong Limited ("HKSE"); Dr. Lo is an independent non-executive director of Television Broadcasts Ltd (HKSE stock code: 511), OCI International Holdings Limited (HKSE stock code: 329), CSI Properties Limited (HKSE stock code: 497), CWT International Limited (HKSE stock code: 521) and NetDragon WebSoft Holdings Limited (HKSE stock code: 777). Dr. Lo was appointed a Justice of Peace of the Government of the Hong Kong Special Administrative Region. He holds the position of chairman and founding governor of the Charles K. Kao Foundation for Alzheimer's Disease, serves as the founding governor of ISF Academy, and is the chairman of Junior Achievement HK.

**Principal Financial Officer**

Michelle Chan ("Ms. Chan") is our financial controller who joined us since November 2021. Ms. Chan has assumed the responsibilities of the chief financial officer since April 2022 and is currently our principal financial officer.

**Involvement in Certain Legal Proceedings**

To the best of our knowledge, none of our directors or executive officers has, during the past ten years, been involved in any legal proceedings described in subparagraph (f) of Item 401 of Regulation S-K.

B. <u>Compensation</u>

**Executive Compensation**

For the year ended June 30, 2025, we paid an aggregate of $0.76 million in cash to our directors and executive officers. We are not required under Cayman Islands law to disclose, and we have not otherwise disclosed, the compensation of our directors and executive officers on an individual basis. We have not set aside or accrued any amounts to provide pension, retirement or other similar benefits to our directors and executive officers. Our subsidiaries in Hong Kong are required by law to make contributions equal to certain percentages of each qualifying employee's salary to the Mandatory Provident Fund Scheme.

During the years ended June 30, 2025 and 2024, we did not pay any salary and bonus to Mr. Yat-Gai Au, our CEO, for services rendered to us. Pursuant to the employment agreement, as amended and restated, we entered into with Mr. Yat-Gai Au, Mr. Au shall receive an annual base salary of $1, and such compensation is subject to annual review and adjustment by our board of directors. The CEO cannot draw his compensation more than $1 until we reach a market capitalization of $1 billion.

On June 9, 2021, each of Evana Yee Wah Hui and our two former independent directors accepted a letter agreement to act as our independent director and was awarded share options under the 2021 Share Option Plan (as defined below) to purchase 15,585 (or 592,230 after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares. The share options become effective upon the effectiveness of the registration statement for our IPO when the nominee's directorship becomes effective. These options are exercisable at $9.50 (or $0.25 after giving retroactive effect to the 38-for-1 forward stock split) per share, of which 25% vest on each anniversary over four years following the closing of our IPO and is valid for 10 years once vested.

On January 1, 2022, Dr. Lo accepted a letter agreement to act as our independent director and was awarded share options under the 2021 Share Option Plan to purchase 15,585 (or 592,230 after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares. These options are exercisable at $31.85 (or $0.84 after giving retroactive effect to the 38-for-1 forward stock split) per share, of which 25% vest on each anniversary over four years following the closing of our IPO and is valid for 10 years once vested.

On June 30, 2025, Ms. Margaret Hoor Han Lo accepted a letter agreement to act as our independent director and was awarded share options under the 2021 Share Option Plan to purchase 592,230 Ordinary Shares. These options are exercisable at $17.40 per share, of which 25% vest on each anniversary over four years following the issuance date and are valid for 10 years once vested.

**2021 Share Option Plan**

We adopted a 2021 Share Option Plan (the "2021 Share Option Plan" or the "Plan") on May 31, 2021. The Plan is a share-based compensation plan that provides for discretionary grants of share options to our key employees, directors and consultants. The purpose of the Plan is to recognize contributions made to our company and its subsidiaries by such individuals and to provide them with additional incentive to achieve our objectives. The following is a summary of the Plan and is qualified by the full text of the Plan.

*Administration*. The Plan will be administered by our CEO and Chairman of our board of directors.

*Number of Ordinary Shares.* The number of Ordinary Shares that may be issued under the Plan is the maximum aggregate number of Ordinary Shares reserved and available pursuant to this Plan shall be the aggregate of (i) 46,932,888 Ordinary Shares, and (ii) on each January 1, starting with January 1, 2022, an additional number of shares equal to the lesser of (A) 2% of the outstanding number of Ordinary Shares (on a fully-diluted basis) on the immediately preceding December 31, and (B) such lower number of Ordinary Shares as may be determined by our board of directors. If there is a forfeiture or termination without the delivery of Ordinary Shares or of other consideration of any option made under the Plan, the Ordinary Shares underlying such option, or the number of Ordinary Shares otherwise counted against the aggregate number of Ordinary Shares available under the Plan with respect to the option, to the extent of any such forfeiture or termination, shall again be, or shall become, available for granting options under the Plan. The number of Ordinary Shares issuable under the Plan is subject to adjustment, in the event of any reorganization, recapitalization, share split, share distribution, merger, consolidation, split-up, spin-off, combination, subdivision, consolidation or exchange of shares, any change in the capital structure of the company or any similar corporate transaction. As of the date of this Annual Report, a total of 48,117,348 Ordinary Shares were authorized for issuance under the Plan, options to purchase 48,117,348 Ordinary Shares have been granted, excluding, if any, awards that were forfeited or canceled after the relevant grant dates and awards that have been vested, and options to purchase 24,490,506 Ordinary Shares are outstanding. All aforementioned figures relating to these options reflect the 38-for-1 forward stock split effective on June 13, 2025.

*Eligibility*. All persons as the CEO and Chairman of our board of directors may select from among the employees, directors, and consultants of our company. The grant of options shall be approved by our board of directors.

*Share Options*. Our board of directors shall determine the provisions, terms, and conditions of each option including, but not limited to, the option vesting schedule, repurchase provisions, rights of first refusal, forfeiture provisions, form of payment (cash, shares, cashless settlement, or other consideration) upon settlement of the option, payment contingencies and the exercise price; each option will last for the term stated in the option agreement, provided, however that in the case of an option that is to qualify as an Incentive Share Option as such term is defined in Section 422 of the Code (as defined in the Plan), the term shall not exceed ten (10) years. It is intended that share options qualify as "performance-based compensation" under Section 162(m) of the Code and thus be fully deductible by us for federal income tax purposes, to the extent permitted by law.

Payment for *Share Options and Withholding Taxes*. Our board of directors may make one or more of the following methods available for payment of an option, including the exercise price of a share option, and for payment of the minimum required tax obligation associated with an award: (i) cash; (ii) cheque; (iii) with respect to options, payment through a broker-dealer sale and remittance procedure pursuant to which the optionee (A) shall provide written instructions to a Company designated brokerage firm to effect the immediate sale of some or all of the purchased Ordinary Shares and remit to us sufficient funds to cover the aggregate exercise price payable for the purchased Ordinary Shares and (B) shall provide written directives to us to deliver the certificates for the purchased Ordinary Shares directly to such brokerage firm in order to complete the sale transaction; (iv) cashless election; or (v) any combination of the foregoing methods of payment.

Upon exercise of an option, we shall have the right, but not the obligation (except as required by applicable law), to withhold or collect from optionee an amount sufficient to satisfy such tax obligations. The optionee will be solely responsible for his/her own tax obligations.

*Amendment of Award Agreements; Amendment and Termination of the Plan; Term of the Plan*. Our board of directors may at any time amend, suspend or terminate the Plan; provided, however, that no such amendment shall be made without the approval of our shareholders to the extent such approval is required by applicable laws, or if such amendment would adversely affect the right of any participant under any agreement in any material way without the written consent of the participant. No option may be granted during any suspension of the Plan or after termination of the Plan. No suspension or termination of the Plan shall adversely affect any rights under options already granted to an optionee. The Plan became effective upon the completion of our IPO on July 20, 2021. It shall continue in effect for a term of ten (10) years unless sooner terminated or unless renewed for another period not to exceed ten (10) years pursuant to shareholder approval.

On June 9, 2021, our board of directors granted 1,235,076 (or 46,932,888 after giving retroactive effect to the 38-for-1 forward stock split) options to certain officers, directors and employees of our company under the 2021 Share Option Plan; provided that the grants of 46,755 (or 1,776,690 after giving retroactive effect to the 38-for-1 forward stock split) options to the independent director nominees at that time will only become effective upon the effectiveness of the registration statement for our IPO when the nominee's directorship becomes effective. These options will be exercisable at $9.50 (or $0.25 after giving retroactive effect to the 38-for-1 forward stock split) per share, of which 25% vest on each anniversary over four years following the closing of our IPO and is valid for 10 years once vested.

On January 1, 2022, our board of directors granted 15,585 (or 592,230 after giving retroactive effect to the 38-for-1 forward stock split) options to a director of our company, under the 2021 Share Option Plan. These options will be exercisable at $31.85 (or $0.84 after giving retroactive effect to the 38-for-1 forward stock split) per share, of which 25% vest on each anniversary over four years following the issuance date and are valid for 10 years once vested.

On June 30, 2025, our board of directors granted 592,230 options to a director of our company, under the 2021 Share Option Plan. These options will be exercisable at $17.40 per share, of which 25% vest on each anniversary over four years following the issuance date and are valid for 10 years once vested.

The following table summarizes, as of the date of this Annual Report, the number of Ordinary Shares underlying outstanding options granted to our directors and executive officers and to other individuals as a group under the 2021 Share Option Plan, excluding awards that were forfeited or cancelled after the relevant grant dates.

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| | | | | |
|:---|:---|:---|:---|:---|
| **Name** | **Ordinary Shares<br> Underlying<br> Outstanding <br> Options Granted** | **Exercise Price**<br> **($ per Ordinary Share)** | **Date of Grant** | **Date of Expiration** |
| Executive officers as a group | 11844258 | $0.25 | June 2021 | Various dates from July 2032 to July 2035 |
| Directors as a group | 2220834 | From $0.25 to $17.40 | Various dates from June <br> 2021 to June 2025 | Various dates from July 2032 to June 2039 |
| Other employees as a group | 10425414 | $0.25 | June 2021 | Various dates from July 2032 to July 2035 |

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Note: The above table reflects the 38-for-1 forward stock split.

In May 2022, all directors and employees who were previously granted share options upon our IPO agreed to a further lock-up undertaking for a period of six months after their share options become vested. Whilst their share options vested on July 16, 2022, their shares remained lock-up until January 16, 2023. This undertaking was subsequently extended to January 20, 2024, and again to January 20, 2025. Most recently, all directors and employees have agreed to a further extension of the lock-up period through April 20, 2026.

**Employment Agreements** 

We have entered into written employment agreements with each of our executive officers. Each of our executive officers is employed for a fixed term subject to automatic renewal or a continuous term unless either we or the executive officer gives prior notice to terminate such employment. These agreements provide for notice periods of varying duration for termination of the agreement by us or by the relevant executive officer, during which time the executive officer will continue to receive salary and benefits. We may terminate the employment for cause, at any time, without notice or remuneration, for certain acts of the executive officer, such as conviction or plea of guilty to a felony or grossly negligent or dishonest acts to our detriment, or misconduct or a failure to perform agreed duties. Each executive officer has agreed to hold, both during and after the employment agreement expires, in strict confidence and not to use or disclose to any person, corporation or other entity without written consent, any confidential information, and has agreed to be bound by non-competition and non-solicitation restrictions set forth in their agreements. In addition, each executive officer has agreed to assign to us all his or her all inventions, improvements, designs, original works of authorship, formulas, processes, compositions of matter, computer software programs, databases, mask works and trade secrets.

C. <u>Board Practices</u>

 

**Terms of Directors and Executive Officers**

Our board of directors currently consists of five directors. Our directors may be elected by a resolution of our board of directors or by an ordinary resolution of our shareholders. Our directors are not subject to a term of office and hold office until the expiration of his or her term, as may be provided in a written agreement with our company, and his or her successor has been elected and qualified, until his or her resignation, until his or her office is otherwise vacated in accordance with our articles of association, or until such time as they are removed from office by ordinary resolution of the shareholders. If the director is appointed by our board of directors, such director holds office until the next following annual meeting of shareholders at which time such director is eligible for re-election. A director will cease to be a director if, among other things, the director (i) becomes bankrupt or makes any arrangement or composition with his creditors; (ii) dies or is found by our company to be or becomes of unsound mind; (iii) resigns his or her office by notice in writing to our company; or (iv) without special leave of absence from our board of directors, is absent from meetings of directors for a continuous period of six months. There is no mandatory retirement age for directors. None of our directors has a service contract with us that provides for benefits upon termination of service, or an appropriate negative statement.

Our officers are elected by and serve at the discretion of our board of directors.

**Duties of Directors**

As a matter of Cayman Islands law, a director owes three types of duties to us: (i) statutory duties, (ii) fiduciary duties, and (iii) common law duties. The Companies Act (Revised) of the Cayman Islands (henceforth, the "Cayman Companies Act") imposes a number of statutory duties on a director. A Cayman Islands director's fiduciary duties are not codified. However, the courts of the Cayman Islands have held that a director owes the following fiduciary duties: (a) a duty to act in what the director bona fide considers to be in the best interests of the company, (b) a duty to exercise their powers for the purposes they were conferred, (c) a duty to avoid fettering his or her discretion in the future and (d) a duty to avoid conflicts of interest and of duty. The common law duties owed by a director are those to act with skill, care and diligence that may reasonably be expected of a person carrying out the same functions as are carried out by that director in relation to the company and, also, to act with the skill, care and diligence in keeping with a standard of care commensurate with any particular skill they have which enables them to meet a higher standard than a director without those skills. In fulfilling their duty of care to us, our directors must ensure compliance with our articles of association, as amended and restated from time to time. We have the right to seek damages if a duty owed by any of our directors is breached.

The functions and powers of our board of directors include, among others:

● convening shareholders' annual general meetings and reporting its work to shareholders at such meetings;

● declaring dividends and distributions;

● appointing officers and determining the term of office of officers;

● exercising the borrowing powers of our company and mortgaging the property of our company; and

● approving the transfer of shares of our company, including the registering of such shares in our share register.

**Interested Transactions**

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Our amended and restated memorandum and articles of association adopted by special resolution passed on May 31, 2021 (as further amended or restated from time to time, "Amended Articles") provide that a director shall not, as a director, vote in respect of any contract, transaction, arrangement or proposal in which they have an interest which (together with any interest of any person connected with them) is a material interest (otherwise than by virtue of their interests, direct or indirect, in shares in the capital of the Company or debentures or other securities of, or otherwise in or through the Company, and if they shall do so, their vote shall not be counted, nor in relation thereto shall they be counted in the quorum present at the meeting.

 ****

Notwithstanding the general prohibitions in the Amended Articles (as set out above), the general prohibitions in the Amended Articles shall not apply to: (a) the giving of any security, guarantee or indemnity in respect of (i) money lent or obligations incurred by a director or any other person for the benefit of the Company or any of its subsidiaries, or (ii) a debt or obligation of the Company or any of its subsidiaries for which the director has assumed responsibility in whole or in part and whether alone or jointly with others under a guarantee or indemnity or by the giving of security; (b) where the Company or any of its subsidiaries is offering securities in which offer the director is or may be entitled to participate as a holder of securities or in the underwriting or sub-underwriting of which the director is to or may participate; (c) any contract, transaction, arrangement or proposal affecting any other body corporate in which the director is interested, directly or indirectly and whether as an officer, shareholder, creditor or otherwise howsoever, provided that they (together with persons connected to them) does not to their knowledge hold an interest representing one per cent or more of any class of the equity share capital of such body corporate (or of any third body corporate through which their interest is derived) or of the voting rights available to members of the relevant body corporate (any such interest being deemed a material interest in all circumstances); (d) any act or thing done or to be done in respect of any arrangement for the benefit of the employees of the Company or any of its subsidiaries under which the director is not accorded as a director any privilege or advantage not generally accorded to the employees to whom such arrangement relates; or (e) any matter connected with the purchase or maintenance for any director of insurance against any liability or (to the extent permitted by the Cayman Companies Act) indemnities in favor of directors, the funding of expenditure by one or more directors in defending proceedings against them or the doing of any thing to enable such director or directors to avoid incurring such expenditure. Furthermore, a director may, as a director, vote (and be counted in the quorum) in respect of any contract, transaction, arrangement or proposal in which they have an interest which is not a material interest or which falls within the aforementioned exceptions. Any such transaction that would reasonably be likely to affect a director's status as an "Independent Director" , or that would constitute a "related party transaction" as defined by Item 7.B of Form 20-F promulgated by the SEC, shall require the approval of the Audit Committee.

**Remuneration and Borrowing**

The directors may receive such remuneration as our board of directors may determine from time to time and in accordance with the recommendations of the compensation committee of our board of directors and our corporate governance documents. Each director is entitled to be repaid or prepaid all traveling, hotel and incidental expenses reasonably incurred or expected to be incurred in attending meetings of our board of directors or committees of our board of directors or shareholder meetings or otherwise in connection with the discharge of his or her duties as a director. The compensation committee will assist the directors in reviewing and approving the compensation structure for the directors. Our board of directors may exercise all the powers of our company to borrow money and to mortgage or charge our undertakings, property and assets both present and future an uncalled capital or any part thereof, and to issue debentures and other securities, whether outright or as collateral security for any of our debts, liabilities or obligations or any of our subsidiary undertaking or of any third party.

**Qualification**

There are no membership qualifications for directors. Further, there are no share ownership qualifications for directors unless so fixed by us in a general meeting by ordinary resolution of our shareholders. There are no other arrangements or understandings pursuant to which our directors are selected or nominated.

**Committees of the Board of Directors**

We have established an audit committee, a compensation committee and a nominating and corporate governance committee under our board of directors. We have adopted a charter for each of the three committees. Each of the committees of our board of directors shall have the composition and responsibilities described below.

***Audit Committee***

Evana Yee Wah Hui, Margaret Hoor Han Lo and Dr. Wing Yan (William) Lo are the members of our Audit Committee, with Dr. Wing Yan (William) Lo serving as the chairperson. All members of our Audit Committee satisfy the independence requirements of Rule 5605(c)(2) of the Nasdaq Stock Market listing rules and meet the independence standards under Rule 10A-3 under the Exchange Act.

We have adopted Audit Committee Charter on December 3, 2020 and the Audit Committee Charter became effective on July 15, 2021. In accordance with our Audit Committee Charter, our Audit Committee shall perform several functions, including:

● evaluates the independence and performance of, and assesses the qualifications of, our independent auditor, and engages such independent auditor;

● approves the plan and fees for the annual audit, interim reviews, tax and other audit-related services, and approves in advance any non-audit service to be provided by the independent auditor;

● monitors the independence of the independent auditor and the rotation of partners of the independent auditor on our engagement team as required by law;

● reviews the financial statements to be included in our annual reports on Form 20-F and interim reports on Form 6-K and reviews with management and the independent auditors the results of the annual audit and reviews of our interim financial statements;

● oversees all aspects our systems of internal accounting control and corporate governance functions on behalf of our board of directors;

● reviews and approves in advance any proposed related-party transactions and report to the full board of directors on any approved transactions; and

● provides oversight assistance in connection with legal, ethical and risk management compliance programs established by our management and our board of directors, including Sarbanes-Oxley Act implementation, and makes recommendations to our board of directors regarding corporate governance issues and policy decisions.

Our board of directors has determined that Dr. Wing Yan (William) Lo possesses accounting or related financial management experience that qualifies him as an "audit committee financial expert" as defined by the rules and regulations of the SEC.

***Compensation Committee***

Evana Yee Wah Hui, Margaret Hoor Han Lo and Dr. Wing Yan (William) Lo are the members of our Compensation Committee with Evana Yee Wah Hui serving as the chairperson. All members of our Compensation Committee satisfy the independence requirements of Rule 5605(a)(2) of the Nasdaq Stock Market listing rules. We have adopted Compensation Committee Charter on December 3, 2020 and the Compensation Committee Charter became effective on July 15, 2021. In accordance with the Compensation Committee's Charter, the Compensation Committee shall be responsible for overseeing and making recommendations to our board of directors regarding the salaries and other compensation of our executive officers and general employees and providing assistance and recommendations with respect to our compensation policies and practices, among other things.

***Nominating and Corporate Governance Committee***

Evana Yee Wah Hui, Margaret Hoor Han Lo and Dr. Wing Yan (William) Lo are the members of our Nominating and Corporate Governance Committee with Margaret Hoor Han Lo serving as the chairperson. All members of our Nominating and Corporate Governance Committee satisfy the independence requirements of Rule 5605(a)(2) of the Nasdaq Stock Market listing rules. We have adopted Nominating and Corporate Governance on December 3, 2020 and the Nominating and Corporate Governance Committee Charter became effective on July 15, 2021. In accordance with the Nominating and Corporate Governance Committee's Charter, the Nominating and Corporate Governance Committee shall be responsible for identifying and proposing new potential director nominees to our board of directors for consideration and reviewing our corporate governance policies, among other things.

**Corporate Governance**

As a Cayman Islands exempted company listed on the Nasdaq Stock Market, we are subject to the Nasdaq Stock Market's corporate governance listing standards. However, Nasdaq rules permit a foreign private issuer like us to follow the corporate governance practices of its home country. Certain corporate governance practices in the Cayman Islands, which is our home country, may differ significantly from the Nasdaq corporate governance listing standards. We have followed on home country's practice exemption with respect to the requirement of holding an annual general meeting of shareholders no later than one year after the end of its fiscal year-end. We may choose to follow additional home country practices in the future.

Our board of directors has adopted a code of business conduct and ethics that applies to our directors, principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, and employees. A copy of our code of business conduct and ethics is available on our website at https://www.regencellbioscience.com.

***Director Independence***

Our board of directors has reviewed the independence of our directors, applying the independence standards under the Nasdaq Stock Market listing rules. Based on this review, our board of directors determined that each of Evana Yee Wah Hui, Margaret Hoor Han Lo, Paul J. Niewiadomski (resigned on June 30, 2025) and Dr. Wing Yan (William) Lo is "independent" within the meaning of the Nasdaq Stock Market listing rules. In making this determination, our board of directors considered the relationships that each of these non-employee directors has with us and all other facts and circumstances our board of directors deemed relevant in determining their independence. As required under applicable Nasdaq Stock Market listing rules, we anticipate that our independent directors will meet on a regular basis as often as necessary to fulfill their responsibilities, including at least annually in executive session without the presence of non-independent directors and management.

**Board Diversity**

The following board diversity matrix sets forth the information concerning the gender and demographic background of our board of directors, as self-identified by its members, in accordance with Nasdaq Stock Market listing rules.

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| | |
|:---|:---|
| Country of Principal Executive Offices | Hong Kong |
| Foreign Private Issuer | Yes |
| Disclosure Prohibited Under Home Country Law | No |
| Total Number of Directors | 5 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Female** | **Male** | **Non-Binary** | **Did Not<br> Disclose<br> Gender** |
| **Part I: Gender Identity** |  |  |  |  |
| Directors | 2 | 3 | 0 | 0 |
| **Part II: Demographic Background** | **Part II: Demographic Background** | **Part II: Demographic Background** | **Part II: Demographic Background** | **Part II: Demographic Background** |
| Underrepresented Individual in Home Country Jurisdiction | 0 | 0 | 0 | 0 |
| LGBTQ+ | 0 | 0 | 0 | 0 |
| Did Not Disclose Demographic Background | 0 | 0 | 0 | 0 |

---

D. <u>Employees</u>

As of June 30, 2025, 2024 and 2023, we had a total of 10, 12 and 12 full-time employees in Hong Kong. As of June 30, 2025, 4 of our full-time employees in Hong Kong were in research and development, 2 were in sales and marketing and 4 were in general administration.

We generally enter into standard confidentiality and employment agreements with our management and other employees. These contracts include a standard non-compete covenant that prohibits the employee from competing with us, directly or indirectly, during his or her employment and for certain years after the termination of his or her employment.

As required by law, our subsidiaries in Hong Kong make contributions equal to certain percentages of each qualifying employee's salary to the Mandatory Provident Fund Scheme.

We believe that we maintain a good working relationship with our employees. We have not experienced any material labor disputes or work stoppages as of the date of this annual report. None of our employees are represented by labor unions or labor organizations or covered by a collective bargaining agreement.

E. <u>Share Ownership</u>

See Item 7 below.

F. <u>Disclosure of a Registrant's Action to Recover Erroneously Awarded Compensation</u>

Not applicable.

**Item 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS**

A. <u>Major Shareholders</u>

The following table sets forth information with respect to beneficial ownership of our Ordinary Shares as of the date of this Annual Report by:

● Each person who is known by us to beneficially own more than 5% of our outstanding Ordinary Shares; and

● Each of our director and executive officers.

We have determined beneficial ownership in accordance with the rules of the SEC. Under such rules, beneficial ownership includes any shares over which the individual has sole or shared voting power or investment power as well as any shares that the individual has the right to acquire within 60 days of the date of this Annual Report, including through the exercise of any options, warrants or other rights or the conversion of any other security. These shares, however, are not included in the computation of the percentage ownership of any other person. Except as indicated by the footnotes below, we believe, based on the information furnished to us, that the persons and entities named in the table below have sole voting and investment power or the power to receive the economic benefit with respect to all Ordinary Shares that they beneficially own, subject to applicable community property laws. None of the shareholders listed in the table are a broker-dealer or an affiliate of a broker dealer. Percentages of beneficial ownership are calculated based on 494,488,908 Ordinary Shares outstanding as of the date of this Annual Report. Unless otherwise indicated in the footnotes, the address for each beneficial owner is in the care of our company at 9/F Chinachem Leighton Plaza, 29 Leighton Road, Causeway Bay, Hong Kong.

---

| | | | |
|:---|:---|:---|:---|
|  | **Ordinary Shares <br> Beneficially Owned** | **Ordinary Shares <br> Beneficially Owned** | **Percentage of <br> Votes Held** |
|  | **Number** | **Percent** | **Percent** |
| **Directors and Executive Officers:** | | | |
| Yat-Gai Au <sup>(1)</sup> | 437896116 | 88.6%<sup>(1)</sup> | 88.6% |
| James Wai Hong Chung |  |  |  |
| Yat-Pui Au | \* | \* | \* |
| Evana Yee Wah Hui |  |  |  |
| Margaret Hoor Han Lo | \* | \* | \* |
| Dr. Wing Yan (William) Lo |  |  |  |
| All directors and executive officers as a group | 439081680 | 88.8% | 88.8% |
| **Principal Shareholders:** |  |  |  |
| Yat-Gai Au <sup>(1)</sup> | 437896116 | 88.6%<sup>(1)</sup> | 88.6% |

---

Note: The above table has given retroactive effect to the 38-for-1 forward stock split.

\* Represents beneficial ownership of less than 1%.

(1) Represents Ordinary Shares held by Regencell (BVI) Limited, a British Virgin Islands company wholly-owned by Mr. Yat-Gai Au, our founder, director and CEO and Mr. Yat-Gai Au's spouse. Mr. Yat-Gai Au is deemed to be the beneficial owners of these securities.

As of the date of this Annual Report, 101,488,918 of our Ordinary Shares were held by a record holder in the United States, which is Cede & Co, representing 20.5% of our total outstanding Ordinary Shares. The number of individual holders of record is based exclusively upon our share register and does not address whether a share or shares may be held by the holder of record on behalf of more than one person or institution who may be deemed to be the beneficial owner of a share or shares in our company. As a result, we may not be aware of each person or group of affiliated persons who beneficially own more than 5% of our Ordinary Shares.

To our knowledge, our company is not owned or controlled directly or indirectly by any government or by any corporation or by any other natural or legal person severally or jointly. We are not aware of any arrangements, known to us, the operation of which may at a subsequent date result in a change in control of our company. Our major shareholders do not have any special voting rights.

For certain information concerning the outstanding awards we have granted to our directors and executive officers individually pursuant to our 2021 Share Option Plan, see "Item 6. Directors, Senior Management and Employees – B. Compensation – 2021 Share Option Plan." Other than under the 2021 Share Incentive Plan, there are no arrangements for involving the employees in the capital of our company, including any arrangement that involves the issue or grant of options or shares or securities of our company.

B. <u>Related Party Transactions</u>

The following is a description of transactions since beginning of our preceding three financial years up to the date hereof, in which the amount involved in the transaction exceeded or will exceed the lesser of $120,000 or one percent of the average of our total assets as at the year-end for the last three completed fiscal years, and to which any of our directors, executive officers or beneficial holders of more than 5% of our share capital, or any immediate family member of, or person sharing the household with, any of these individuals, had or will have a direct or indirect material interest.

**Other Payables with Our Executive Management**

As of June 30, 2025 and 2024, other payables – related parties represented reimbursement from related parties and the Company's executive management, Mr. Chung and Mr. Au for out-of-pocket expenses incurred for business purposes. The balances due to Mr. Chung and Mr. Au were approximately nil and $2,539, respectively, as of June 30, 2025 and $681 and $7,606, respectively, as of June 30, 2024.

During the years ended June 30, 2025 and 2024, the expenses paid for TCM formula and materials for product development to Regeneration Company Limited, a related company, were approximately $0.07 million and $0.09 million, respectively. The reimbursement to Regeneration Company Limited for out-of-pocket expenses incurred for research and development purposes were approximately $0.21 million and $0.21 million, respectively. The balance due to Regeneration Company Limited was approximately nil and $156 respectively as of June 30, 2025 and 2024.

During the years ended June 30, 2025 and 2024, the expenses paid for services fee for research support to Regencell Bioscience Asia Sdn. Bhd., a related company, were approximately nil and $0.03 million, respectively. No balance was due to Regencell Bioscience Asia Sdn. Bhd., as of June 30, 2025 and 2024.

**2021 Share Option Plan**

See "Item 6. Directors, Senior Management and Employees – B. Compensation – 2021 Share Option Plan."

**Employment Agreements** 

See "Item 6. Directors, Senior Management and Employees – B. Compensation - Employment Agreements"

**Partnership Agreements with TCM Practitioner**

In January 2018, we entered into a Strategic Partnership Agreement with our TCM Practitioner, the father of our CEO and director. Pursuant to the Strategic Partnership Agreement we have with the TCM Practitioner, we have exclusive rights and ownership of all his TCM formula for patients suffering from ADHD and ASD, and all other TCM formula targeting different kinds of human illnesses, disorders and degeneration as well as the intellectual property rights of the TCM formula, including research and development, trademark, copyright, patent, and any other intellectual property rights in relation to the TCM formula that he owns. The TCM Practitioner is authorized to conduct research studies on these TCM formula. Any inventions, TCM formula, utilities, models' improvements, research, discoveries, designs, processes, methods of manufacture, and products conceived or made by the TCM Practitioner in relation to TCM shall be the sole and exclusive property of us.

The Strategic Partnership Agreement does not have a termination date and will remain effective indefinitely under Hong Kong law. The Strategic Partnership Agreement can be amended or terminated by the mutual written agreement of the parties without breach. Pursuant to the Strategic Partnership Agreement, in exchange for the rights, we are required to donate three percent (3.0%) of net revenue as shown in the audited financial accounts that we generate in association with the use and/or commercialization of the TCM formula to any of charitable institutions and/or trusts of a public character anywhere in the world at the sole and absolute choice of the TCM Practitioner and in such proportion at the sole and absolute discretion of the TCM practitioner on a yearly basis. We also undertake to pay for all reasonable costs and expenses incurred by the TCM Practitioner in conducting research, testing, attending meetings/seminars, compiling records, or performing any similar acts in relation to the development of the TCM formula.

**Supplemental Agreement with TCM Practitioner**

In November 2020, we entered into a Supplemental Agreement with the TCM Practitioner. Under the Supplemental Agreement, the TCM Practitioner shall provide his research by using his best endeavors on his TCM formula and TCM inventions under our direction and supervision. We shall pay the TCM Practitioner for his expenses on his TCM research within 30 days upon the receipt of invoice. We have authorized the TCM Practitioner, his agents, subcontractors, development team, and affiliates to use TCM formula and TCM inventions to conduct research. However, the authorized parties, including TCM Practitioner, shall not directly or indirectly publish, disseminate or otherwise disclose, deliver or make available to any third party any confidential information, without our prior written consent and notice. The confidential information includes all information, know-how, and records in any way connected with our company and our research, including all TCM inventions, TCM formula, and intellectual property rights, data, operations and testing procedures, and all patients and supplier information, etc. The confidentiality obligations shall survive notwithstanding the termination of the Supplemental Agreement for ten (10) years thereafter. The TCM Practitioner also shall not to be directly or indirectly concerned with or engaged or interested in any other business which is in any respect in competition with or similar to the TCM business conducted by our company for two (2) years after the expiration or termination of the Supplemental Agreement.

The Supplemental Agreement shall remain effective until the Strategic Partnership Agreement is terminated. We may terminate this Supplemental Agreement for any reason in our sole discretion and without any indemnity or damages being due to TCM Practitioner with thirty (30) days prior written notice. The TCM Practitioner may terminate this Supplemental Agreement in the event that we fail to meet our payment obligations under Supplemental Agreement which is not cured within thirty (30) days of the notification of such by us.

**Policies and Procedures for Related Party Transactions**

Our board of directors has established an audit committee which is responsible for reviewing and approving all related party transactions.

C. <u>Interests of Experts and Counsel</u>

Not applicable.

**Item 8. FINANCIAL INFORMATION**

A. <u>Consolidated Statements and Other Financial Information</u>

We have appended consolidated financial statements filed as part of this Annual Report.

**Legal Proceedings**

From time to time, we may be subject to legal or administrative proceedings, investigations and claims arising in the ordinary course of our business. In addition, following recent volatility in the market for our Ordinary Shares, the Company received correspondence and a subpoena from the U.S. Department of Justice ("DOJ"), indicating that the DOJ is conducting an investigation into the trading in our Ordinary Shares. The DOJ has requested the production of documents and communications concerning these and other corporate operational, financial and accounting matters. We are cooperating with this investigation, but we cannot predict its ultimate resolution. We expect to continue to incur significant legal costs and other expenses in connection with responding to the investigation. We may be required to pay fines, penalties, damages or settlement costs in excess of our insurance coverage, if any, related to the investigation. While we are not currently subject to any legal or administrative proceedings, it is possible that government investigations, including the pending investigation in which we are involved, and related legal and administrative proceedings in the future, if any, could result in the institution of administrative, injunctive, or other proceedings against us and/or our directors, officers, or employees or the imposition of fines, suspension, or other remedies and sanctions. Any such material costs and expenses or injunctive relief could have a material adverse effect on our financial condition and results of operations.

**Dividend Policy**

We intend to keep any future earnings to finance the expansion of our business, and we do not anticipate that any cash dividends will be declared or paid in the foreseeable future.

Our board of directors has discretion as to whether to distribute dividends, subject to certain requirements of Cayman Islands law. Subject to the Cayman Companies Act, we in a general meeting may declare a dividend, but no dividend may exceed the amount recommended by our directors. Under Cayman Islands law, a Cayman Islands exempted company may pay a dividend on its shares out of either distributable profits or amounts standing to the credit of the share premium account, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts due in the ordinary course of business.

If we determine to pay dividends on any of our Ordinary Shares in the future, as a holding company, we will be dependent on additional debt or equity financing by the holding company and/or receipt of funds from our subsidiaries, Regencell Bioscience Limited and Regencell Limited, which are incorporated in Hong Kong. Even if our board of directors decides to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors that our board of directors may deem relevant. There is no restriction under Hong Kong laws that may restrict the abilities of our Hong Kong subsidiaries to pay dividends to us.

B. <u>Significant Changes</u>

Except as disclosed elsewhere in this Annual Report, we have not experienced any significant changes since the date of our audited consolidated financial statements included in this Annual Report.

**Item 9. THE OFFER AND LISTING**

A. <u>Offering and Listing Details.</u>

Our Ordinary Shares are currently listed on Nasdaq Capital Market under the symbol "RGC".

B. <u>Plan of Distribution</u>

Not applicable.

C. <u>Markets</u>

Our Ordinary Shares are currently listed on Nasdaq Capital Market under the symbol "RGC".

D. <u>Selling Shareholders</u>

Not applicable.

E. <u>Dilution</u>

Not applicable.

F. <u>Expenses of the Issue</u>

Not applicable.

**Item 10. ADDITIONAL INFORMATION**

A. <u>Share Capital</u>

Not applicable.

B. <u>Memorandum and Articles of Association</u>

The following description of our share capital and certain provisions of Amended Articles, are summaries and do not purport to be complete. Reference is made to our Amended Articles, a copy of which is filed as an exhibit to this Annual Report (and which is referred to in this section as, respectively, the "memorandum" and the "articles").

We were incorporated as an exempted company with limited liability under the Cayman Companies Act. A Cayman Islands exempted company:

● is a company that conducts its business mainly outside the Cayman Islands;

● is prohibited from trading in the Cayman Islands with any person, firm or corporation except in furtherance of the business of the exempted company carried on outside the Cayman Islands (and for this purpose can affect and conclude contracts in the Cayman Islands and exercise in the Cayman Islands all of its powers necessary for the carrying on of its business outside the Cayman Islands);

● does not have to hold an annual general meeting;

● does not have to make its register of members open to inspection by shareholders of that company;

● may obtain an undertaking against the imposition of any future taxation;

● may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;

● may register or deregister as a limited duration company; and

● may register or deregister as a segregated portfolio company.

**Objects**

Under the Amended Articles, the objects of our company are unrestricted. As provided by the Cayman Companies Act, we have the full power and authority to carry out any object not prohibited by any law of the Cayman Islands and the Amended Articles.

**Ordinary Shares**

All of our issued and outstanding Ordinary Shares are fully paid and non-assessable. Our Ordinary Shares are issued in registered form, and are issued when registered in our register of members. Unless and until the directors resolve to issue share certificates, no share certificate shall be issued, and the records of the shareholdings of each shareholder shall be in uncertified book entry form. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their Ordinary Shares. We may not issue shares or warrants to bearer.

As of the date of this Annual Report, the authorized share capital of the Company is US$1,000,000 divided into 100,000,000,000 Ordinary Shares of US$0.00001 par value each. Subject to the provisions of the Cayman Companies Act and the provisions, if any, of the Amended Articles, and any directions given by any ordinary resolution and the rights attaching to any class of existing shares, the directors may issue, allot, grant options over or otherwise dispose of shares (including any fractions of Shares) and other securities of our company at such times, to such persons, for such consideration and on such terms as the directors may determine. Such authority could be exercised by the directors to allot shares which carry rights and privileges that are preferential to the rights attaching to Ordinary Shares. No share may be issued at a discount except in accordance with the provisions of the Cayman Companies Act. The directors may refuse to accept any application for shares, and may accept any application in whole or in part, for any reason or for no reason.

**Listing**

Our Ordinary Shares have been approved for listing on the Nasdaq Capital Market under the symbol "RGC".

**Transfer Agent and Registrar**

The transfer agent and registrar for the Ordinary Shares is Vstock Transfer, LLC.

**Dividends**

Subject to the provisions of the Cayman Companies Act and any rights for the time being attaching to any class or classes of shares under and in accordance with the Amended Articles, the directors may declare dividends or distributions out of our funds which are lawfully available for that purpose.

Subject to the provisions of the Cayman Companies Act and any rights for the time being attaching to any class or classes of shares under and in accordance with the Amended Articles, our shareholders may, by ordinary resolution, declare dividends but no such dividend shall exceed the amount recommended by the directors.

Subject to the requirements of the Cayman Companies Act regarding the application of a company's share premium account and with the sanction of an ordinary resolution, dividends may also be declared and paid out of any share premium account. The directors when paying dividends to shareholders may make such payment either in cash or in specie.

Unless provided by the rights attached to a share under and in accordance with the Amended Articles, no dividend shall bear interest against us.

**Voting Rights**

Unless their shares carry no right to vote, or unless a call or other amount presently payable has not been paid, all shareholders are entitled to vote at a general meeting, whether on a show of hands or on a poll, and all shareholders holding shares of a particular class of shares are entitled to vote at a meeting of the holders of that class of shares.

Subject to any rights or restrictions as to voting attached to any shares, unless any share carries special voting rights: (i) on a show of hands, every shareholder who is present in person and every person representing a shareholder by proxy shall have one vote; and (ii) on a poll, every shareholder who is present in person and every person representing a shareholder by proxy shall have one vote for each share of which he or the person represented by proxy is the holder.

**Variation of Rights of Shares**

Subject to the Cayman Companies Act and without prejudice to article 8 of the Amended Articles, if the share capital is divided into different classes of shares then, all or any of the special rights for the time being attached to the shares or any class of shares may, unless otherwise provided by the terms of issue of the shares of that class, only be varied if one of the following applies: (i) the shareholders holding not less than two-thirds of the issued shares of that class consent in writing to the variation; or (ii) the variation is made with the sanction of a special resolution (being a resolution of a meeting of the holders of the relevant class of shares in a class meeting duly constituted in accordance with the Amended Articles passed by a majority of not less than two-thirds of the shareholders who (being entitled to do so) vote in person or by proxy at that meeting) passed at a separate general meeting of the holders of the shares of that class.

Unless the terms on which a class of shares was issued state otherwise, the rights conferred on the shareholder holding shares of any class shall not be deemed to be varied by the creation or issue of further shares ranking pari passu therewith.

**Alteration of Share Capital**

Subject to the Cayman Companies Act, the Company may, by ordinary resolution (being a resolution of a general meeting passed by a simple majority of the shareholders who (being entitled to do so) vote in person or by proxy at that meeting):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) increase our share capital by such sum to be divided into shares of such amount and with the attached rights, priorities and privileges and restrictions attached to them as that ordinary resolution shall prescribe;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) consolidate and divide all or any of our share capital into shares of larger amount than our existing shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) convert all or any of our paid up shares into stock, and reconvert that stock into paid up shares of any denomination;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) sub-divide our shares or any of them into shares of an amount smaller than that fixed, so, however, that in the sub-division, the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as it was in case of the share from which the reduced share is derived; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) cancel shares which, at the date of the passing of that ordinary resolution, have not been taken or agreed to be taken by any person and diminish the amount of our share capital by the amount of the shares so cancelled or, in the case of shares without nominal par value, diminish the number of shares into which our capital is divided.

Subject to the Cayman Companies Act and to any rights for the time being conferred on the shareholders holding a particular class of shares, the Company may, by special resolution (being a resolution of a general meeting or a resolution of a meeting of the holders of any class of shares in a class meeting duly constituted in accordance with the Amended Articles in each case passed by a majority of not less than two-thirds of the shareholders who (being entitled to do so) vote in person or by proxy at that meeting), reduce its share capital in any lawful way.

**Calls on Shares and Forfeiture**

Subject to the terms of allotment, the board of directors of the Company may make calls on the shareholders in respect of any monies unpaid on their shares including any premium. The call may provide for payment to be by instalments. Each shareholder shall (subject to receiving at least 14 clear days' notice specifying when and where payment is to be made), pay to us the amount called on his shares as required by the notice. Shareholders registered as the joint holders of a share shall be jointly and severally liable to pay all calls in respect of the share. If a call remains unpaid after it has become due and payable the person from whom it is due and payable shall pay interest on the amount unpaid from the day it became due and payable until it is paid: (i) at the rate fixed by the terms of allotment of the share or in the notice of the call, or (ii) if no rate is fixed, at the rate of ten percent per annum. The directors may waive payment of the interest wholly or in part.

We have a first and paramount lien on all shares (whether fully paid up or not) registered in the name of a shareholder (whether solely or jointly with others). The lien is for all monies payable to us by the shareholder or the shareholder's estate:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) either alone or jointly with any other person, whether or not that other person is a shareholder; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) whether or not those monies are presently payable.

At any time the directors may declare any share to be wholly or partly exempt from the lien on shares provisions of the Amended Articles.

We may sell any shares over which we have a lien if all of the following conditions are met: (a) the sum in respect of which the lien exists is presently payable; (ii) the Company gives notice to shareholder holding the share (or to the person entitled to it in consequence of the death or bankruptcy of that shareholder) demanding payment and stating that if the notice is not complied with the shares may be sole and; (iii) within 14 clear days of the date on which the notice is deemed to be given under the Amended Articles, such notice has not been complied with.

**Unclaimed Dividend**

A dividend that remains unclaimed for a period of six years after it became due for payment shall be forfeited to, and shall cease to remain owing by, the company.

**Forfeiture or Surrender of Shares**

If a shareholder fails to pay any call, the directors may give to such shareholder not less than 14 clear days' notice requiring payment and specifying the amount unpaid including any interest which may have accrued, any expenses which have been incurred by us due to that person's default and the place where payment is to be made. The notice shall also contain a warning that if the notice is not complied with, the shares in respect of which the call is made will be liable to be forfeited.

If such notice is not complied with, the directors may, before the payment required by the notice has been received, resolve that any share the subject of that notice be forfeited (which forfeiture shall include all dividends or other monies payable in respect of the forfeited share and not paid before such forfeiture). Despite the foregoing, the board of directors may determine that any share the subject of that notice be accepted by the Company as surrendered by the shareholder holding the share in lieu of forfeiture.

A forfeited or surrendered share may be sold, re-allotted or otherwise disposed of on such terms and in such manner as the board of directors determine either to the former shareholder who held that share or to any other person, and at any time before a sale, re-allotment or disposition the forfeiture may be cancelled on such terms as the directors think fit.

A person whose shares have been forfeited shall cease to be a shareholder in respect of the forfeited shares, but shall, notwithstanding such forfeiture, remain liable to pay to us all monies which at the date of forfeiture were payable by him to us in respect of the shares, together with all expenses and interest from the date of forfeiture or surrender until payment, but his liability shall cease if and when we receive payment in full of the unpaid amount.

A declaration, whether statutory or under oath, made by a director or the secretary shall be conclusive evidence that the person making the declaration is a director or secretary and that the particular shares have been forfeited or surrendered on a particular date.

Subject to the execution of an instrument of transfer, if necessary, the declaration shall constitute good title to the shares.

**Share Premium Account**

The directors shall establish a share premium account in accordance with the Cayman Companies Act and shall carry to the credit of such account from time to time an amount equal to the amount or value of the premium paid on the issue of any share or capital contributed or such other amounts required by the Cayman Companies Act.

**Redemption and Purchase of Own Shares**

Subject to the Cayman Companies Act and any rights for the time being conferred on the shareholders holding a particular class of shares, we may by action of our directors:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) issue shares that are to be redeemed or liable to be redeemed, at our option or the shareholder holding those redeemable shares, on the terms and in the manner our directors determine before the issue of those shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) with the consent by special resolution of the shareholders holding shares of a particular class (being a resolution of a meeting of the holders of any class of shares in a class meeting duly constituted in accordance with the Amended Articles passed by a majority of not less than two-thirds of the shareholders who (being entitled to do so) vote in person or by proxy at that meeting), vary the rights attaching to that class of shares so as to provide that those shares are to be redeemed or are liable to be redeemed at our option on the terms and in the manner which the directors determine at the time of such variation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) purchase all or any of our own shares of any class including any redeemable shares on the terms and in the manner which the directors determine at the time of such purchase.

We may make a payment in respect of the redemption or purchase of our own shares in any manner authorized by the Cayman Companies Act, including out of any combination of capital, our profits and the proceeds of a fresh issue of shares.

When making a payment in respect of the redemption or purchase of shares, the directors may make the payment in cash or in specie (or partly in one and partly in the other) if so authorized by the terms of the allotment of those shares or by the terms applying to those shares, or otherwise by agreement with the shareholder holding those shares.

**Transfer of Shares**

Without limiting the transfer provisions in the Amended Articles, our board of directors would generally decline to register any transfer of any Ordinary Share that has not been fully paid up or is subject to a company lien.

Our board of directors may also decline to register any transfer of any Ordinary Share unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the instrument of transfer is lodged with us, accompanied by the certificate for the Ordinary Shares to which it relates and such other evidence as our board of directors may reasonably require to show the right of the transferor to make the transfer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the instrument of transfer is in respect of only one class of Ordinary Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the instrument of transfer is properly stamped, if required;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the Ordinary Share transferred is fully paid and free of any lien in favor of us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any fee related to the transfer has been paid to us; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) the transfer is not to more than four joint holders.

If our directors refuse to register a transfer, they are required, within three months after the date on which the instrument of transfer was lodged, to send to each of the transferor and the transferee notice of such refusal.

This, however, is unlikely to affect market transactions of the Ordinary Shares purchased by investors in the public offering. Once the Ordinary Shares have been listed, the legal title to such Ordinary Shares and the registration details of those Ordinary Shares in the Company's register of members will remain with DTC/Cede & Co. All market transactions with respect to those Ordinary Shares will then be carried out without the need for any kind of registration by the directors, as the market transactions will all be conducted through the DTC systems.

Notwithstanding the foregoing, shares may be evidenced and transferred in accordance with the rules and regulations of the Designated Stock Exchange.

The registration of transfers may, on 14 calendar days' notice being given by advertisement in such one or more newspapers or by electronic means, be suspended and our register of members closed at such times and for such periods as our board of directors may from time to time determine. The registration of transfers, however, may not be suspended, and the register may not be closed, for more than 30 days in any year.

**Inspection of Books and Records**

Holders of our Ordinary Shares will have no general right under the Cayman Companies Act to inspect any account or book or document or obtain copies of our register of members or our corporate records.

**General Meetings**

As a Cayman Islands exempted company, we are not obligated by the Cayman Companies Act or our Amended Articles to call an annual general meeting of the shareholders. Accordingly, we may, but shall not be obligated to (unless required by the designated stock exchange rules), in each year hold a general meeting as an annual general meeting. Any annual general meeting held shall be held at such time and place as may be determined by our board of directors. All general meetings other than annual general meetings shall be called extraordinary general meetings.

The directors may convene general meetings whenever they think fit. General meetings shall also be convened on the written requisition (delivered in accordance with the notice provisions of the Amended Articles) of one or more of the shareholders entitled to attend and vote at our general meetings who (together) hold not less than ten percent of the rights to vote at such general meeting in accordance with the notice provisions in the Amended Articles, specifying the purpose of the meeting and signed by each of the shareholders making the requisition. If the directors do not convene such meeting for a date not later than 21 clear days' after the date of receipt of the written requisition, those shareholders who requested the meeting may convene the general meeting themselves within three months after the end of such period of 21 clear days in which case reasonable expenses incurred by them as a result of the directors failing to convene a meeting shall be reimbursed by us.

At least 14 clear days' notice of an extraordinary general meeting and 21 clear days' notice of an annual general meeting shall be given to shareholders entitled to attend and vote at such meeting (including, for the avoidance of doubt, persons entitled to a share in consequence of the death or bankruptcy of a shareholder). The notice shall specify: (i) the place, the date and the hour of the meeting; (ii) if the meeting is to be held in two or more places, the technology that will be used to facilitate the meeting; (iii) subject to limb (iv) and the requirements of, to the extent applicable, the designated stock exchange rules, the general nature of the business to be transaction; and (iv) if a resolution is proposed as a special resolution, the text of that resolution. Notice of every general meeting shall also be given to the directors and our auditors.

Subject to the Cayman Companies Act and with the consent of the shareholders who, individually or collectively, hold at least 90 percent of the voting rights of all those who have a right to vote at a general meeting, a general meeting may be convened on shorter notice.

A quorum shall consist of the presence (whether in person or represented by proxy) of one or more shareholders holding shares that represent not less than one-third of the outstanding shares carrying the right to vote at such general meeting.

If, within 15 minutes from the time appointed for the general meeting, or at any time during the meeting, a quorum is not present, the meeting, if convened upon the requisition of shareholders, shall be cancelled. In any other case it shall stand adjourned to the same time and place seven days hence, or to such other time or place as is determined by the directors. If a quorum is not present within 15 minutes of the time appointed for the adjourned meeting, then the shareholders present in person or by proxy shall constitute a quorum.

The chairman may, with the consent of a meeting at which a quorum is present, adjourn the meeting. When a meeting is adjourned for seven days or more, notice of the adjourned meeting shall be given in accordance with the articles.

At any general meeting a resolution put to the vote of the meeting shall be decided on a show of hands, unless a poll is (before, or on, the declaration of the result of the show of hands) demanded by the chairman of the meeting or by at least two shareholders having the right to vote on the resolutions or by one or more shareholders present who. Individually or together, hold at least ten percent of the voting rights of all those who are entitled to vote on the resolution. Unless a poll is so demanded, a declaration by the chairman as to the result of a resolution and an entry to that effect in the minutes of the meeting, shall be conclusive evidence of the outcome of a show of hands, without proof of the number or proportion of the votes recorded in favor of, or against, that resolution.

If a poll is duly demanded it shall be taken in such manner as the chairman directs and the result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded.

In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of the meeting at which the show of hands takes place or at which the poll is demanded, shall not be entitled to a second or casting vote.

**Directors**

Under the Amended Articles, we are required to have a minimum of one director and the maximum number of directors shall be unlimited.

A director may be appointed by ordinary resolution (being a resolution of a general meeting passed by a simple majority of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution) or by the directors. Any appointment may be to fill a vacancy or as an additional director.

Unless the remuneration of the directors is determined by the shareholders by ordinary resolution (being a resolution of a general meeting passed by a simple majority of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution), the directors (other than alternate directors) shall be entitled to such remuneration as the directors may determine.

The shareholding qualification for directors may be fixed by our shareholders by ordinary resolution (being a resolution of a general meeting passed by a simple majority of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution) and unless and until so fixed no share qualification shall be required.

Unless removed or re-appointed, each director shall be appointed for a term expiring at the next-following annual general meeting, if one is held. At any annual general meeting held, our directors will be elected by an ordinary resolution of our shareholders (being a resolution of a general meeting passed by a simple majority of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution). At each annual general meeting, each director so elected shall hold office for a one-year term and until the election of their respective successors in office or removed.

A director may be removed by ordinary resolution (being a resolution of a general meeting passed by a simple majority of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution).

A director may at any time resign or retire from office by giving us notice in writing. Unless the notice specifies a different date, the director shall be deemed to have resigned on the date that the notice is delivered to us.

Subject to the provisions of the Amended Articles, the office of a director may be terminated forthwith if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) he is prohibited by the law of the Cayman Islands from acting as a director;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) he is made bankrupt or makes an arrangement or composition with his creditors generally;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) he resigns his office by notice to us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) he only held office as a director for a fixed term and such term expires;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) in the opinion of a registered medical practitioner by whom he is being treated he becomes physically or mentally incapable of acting as a director;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) he is given notice by the majority of the other directors (not being less than two in number) to vacate office (without prejudice to any claim for damages for breach of any agreement relating to the provision of the services of such director);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) he is made subject to any law relating to mental health or incompetence, whether by court order or otherwise; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) without the consent of the other directors, he is absent from meetings of directors for continuous period of six months.

Each of the compensation committee and the nominating and corporate governance committee shall consist of at least three directors and the majority of the committee members shall be independent within the meaning of Section 5605(a)(2) of the Nasdaq Listing Rules. The audit committee shall consist of at least three directors, all of whom shall be independent within the meaning of Section 5605(a)(2) of the Nasdaq Listing Rules and will meet the criteria for independence set forth in Rule 10A-3 of the Securities Exchange Act of 1934, as amended, or the Exchange Act.

**Powers and Duties of Directors**

Subject to the provisions of the Cayman Companies Act and our Amended Articles, our business shall be managed by the directors, who may for that purpose exercise all our powers. No prior act of the directors shall be invalidated by any subsequent alteration of our Amended Articles. However, to the extent allowed by the Cayman Companies Act, shareholders may by special resolution (being a resolution of a general meeting passed by a majority of not less than two-third of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution) validate any prior or future act of the directors which would otherwise be in breach of their duties.

The directors may delegate any of their powers to any committee consisting of one or more persons who need not be shareholders and may include non-directors so long as the majority of those persons are directors; any committee so formed shall in the exercise of the powers so delegated conform to any regulations that may be imposed on it by the directors. Our board of directors have established an audit committee, compensation committee, and nomination and corporate governance committee.

The board of directors may establish any local or divisional board of directors or agency and delegate to it its powers and authorities (with power to sub-delegate) for managing any of our affairs whether in the Cayman Islands or elsewhere and may appoint any persons to be members of a local or divisional board of directors, or to be managers or agents, and may fix their remuneration.

The directors may from time to time and at any time by power of attorney or in any other manner they determine to appoint any person, either generally or in respect of any specific matter, to be our agent with or without authority for that person to delegate all or any of that person's powers.

The directors may from time to time and at any time by power of attorney or in any other manner they determine to appoint any person, whether nominated directly or indirectly by the directors, to be our attorney or our authorized signatory and for such period and subject to such conditions as they may think fit. The powers, authorities and discretions, however, must not exceed those vested in, or exercisable, by the directors under the articles.

The board of directors may remove any person so appointed and may revoke or vary the delegation.

The directors may exercise all of our powers to borrow money and to mortgage or charge the Company's undertaking, property and assets both present and future and uncalled capital or any part thereof, to issue debentures and other securities whether outright or as collateral security for any debt, liability or obligation of ours or our parent undertaking (if any) or any subsidiary undertaking of us or of any third party.

A director shall not, as a director, vote in respect of any contract, transaction, arrangement or proposal in which he has an interest which (together with any interest of any person connected with him) is a material interest (otherwise than by virtue of his interests, direct or indirect, in shares or debentures or other securities of, or otherwise in or through, us) and if he shall do so his vote shall not be counted, nor in relation thereto shall he be counted in the quorum present at the meeting, but (in the absence of some other material interest than is mentioned below) none of these prohibitions shall apply to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the giving of any security, guarantee or indemnity in respect of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) money lent or obligations incurred by him or by any other person for our benefit or any of our subsidiaries; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a debt or obligation of ours or any of our subsidiaries for which the director himself has assumed responsibility in whole or in part and whether alone or jointly with others under a guarantee or indemnity or by the giving of security;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) where we or any of our subsidiaries is offering securities in which offer the director is or may be entitled to participate as a holder of securities or in the underwriting or sub-underwriting of which the director is to or may participate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any contract, transaction, arrangement or proposal affecting any other body corporate in which he is interested, directly or indirectly and whether as an officer, shareholder, creditor or otherwise howsoever, provided that he (together with persons connected with him) does not to his knowledge hold an interest representing one percent or more of any class of the equity share capital of such body corporate (or of any third body corporate through which his interest is derived) or of the voting rights available to shareholders of the relevant body corporate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any act or thing done or to be done in respect of any arrangement for the benefit of the employees of us or any of our subsidiaries under which he is not accorded as a director any privilege or advantage not generally accorded to the employees to whom such arrangement relates; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any matter connected with the purchase or maintenance for any director of insurance against any liability or (to the extent permitted by the Cayman Companies Act) indemnities in favor of directors, the funding of expenditure by one or more directors in defending proceedings against him or them or the doing of anything to enable such director or directors to avoid incurring such expenditure.

A director may, as a director, vote (and be counted in the quorum) in respect of any contract, transaction, arrangement or proposal in which he has an interest which is not a material interest or as described above.

**Capitalization of Profits**

The directors may resolve to capitalize:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any part of our profits not required for paying any preferential dividend (whether or not those profits are available for distribution); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any sum standing to the credit of our share premium account or capital redemption reserve, if any.

The amount resolved to be capitalized must be appropriated to the shareholders who would have been entitled to it had it been distributed by way of dividend and in the same proportions.

**Liquidation Rights**

Pursuant to the Cayman Companies Act, the Company may be wound up voluntarily if the shareholders resolved by special resolution (being a resolution of a general meeting passed by a majority of not less than two-third of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution) or if the shareholders in a general meeting resolve by ordinary resolution (being a resolution of a general meeting passed by a simple majority of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution) that it be wound up voluntarily because it is unable to pay its debts.

If we are wound up, the shareholders may, subject to the Amended Articles and any other sanction required by the Cayman Companies Act, pass a special resolution (being a resolution of a general meeting passed by a majority of not less than two-third of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution) allowing a liquidator to do either or both of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to divide in specie among the shareholders the whole or any part of our assets and, for that purpose, to value any assets and to determine how the division shall be carried out as between the shareholders or different classes of shareholders; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to vest the whole or any part of the assets in trustees for the benefit of shareholders and those liable to contribute to the winding up.

The directors have the authority to present a petition for our winding up to the Grand Court of the Cayman Islands on our behalf without the sanction of a resolution passed at a general meeting.

**Rights of Non-resident or Foreign Shareholders**

There are no limitations imposed by our Amended Articles on the rights of non-resident or foreign shareholders to hold or exercise voting rights on our Ordinary Shares.

In addition, there are no provisions in our Amended Articles governing the ownership threshold above which shareholder ownership must be disclosed.

**Register of Members**

Under the Cayman Companies Act, we must keep a register of members and there should be entered therein:

● the names and addresses of the members of the company, a statement of the shares held by each member, which:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o distinguishes each share by its number (so long as the share has a number);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o confirms the amount paid, or agreed to be considered as paid, on the shares of each member;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o confirms the number and category of shares held by each member; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o confirms whether each relevant category of shares held by a member carries voting rights under the Articles,
and if so, whether such voting rights are conditional;

● the date on which the name of any person was entered on the register as a member; and

● the date on which any person ceased to be a member.

For these purposes, "voting rights" means rights conferred on shareholders, including the right to appoint or remove directors, in respect of their shares to vote at general meetings of the company on all or substantially all matters. A voting right is conditional where the voting right arises only in certain circumstances.

Under the Cayman Companies Act, the register of members of our company is prima facie evidence of the matters set out therein (that is, the register of members will raise a presumption of fact on the matters referred to above unless rebutted) and a shareholder registered in the register of members is deemed as a matter of the Cayman Companies Act to have legal title to the shares as set against its name in the register of members. Upon the completion of this offering, the register of members will be immediately updated to record and give effect to the issuance of shares by us to the custodian or its nominee. Once our register of members has been updated, the shareholders recorded in the register of members will be deemed to have legal title to the shares set against their name.

If the name of any person is incorrectly entered in or omitted from our register of members, or if there is any default or unnecessary delay in entering on the register the fact of any person having ceased to be a shareholder of our company, the person or shareholder aggrieved (or any shareholder of our company or our company itself) may apply to the Grand Court of the Cayman Islands for an order that the register be rectified, and the Court may either refuse such application or it may, if satisfied of the justice of the case, make an order for the rectification of the register.

**Differences in Corporate Law**

The Cayman Companies Act is derived, to a large extent, from the older Companies Acts of England and Wales but does not follow recent United Kingdom statutory enactments, and accordingly there are significant differences between the Cayman Companies Act and the current Companies Act of England. In addition, the Cayman Companies Act differs from laws applicable to United States corporations and their shareholders. Set forth below is a summary of certain significant differences between the provisions of the Cayman Companies Act applicable to us and the comparable laws applicable to companies incorporated in the State of Delaware in the U.S.

 ****

***Mergers and Similar Arrangements***

The Cayman Companies Act permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies. For these purposes, (a) "merger" means the merging of two or more constituent companies and the vesting of their undertaking, property and liabilities in one of such companies as the surviving company, and (b) a "consolidation" means the combination of two or more constituent companies into a consolidated company and the vesting of the undertaking, property and liabilities of such companies to the consolidated company. In order to effect such a merger or consolidation, the directors of each constituent company must approve a written plan of merger or consolidation, which must then be authorized by (a) a special resolution of the shareholders of each constituent company, and (b) such other authorization, if any, as may be specified in such constituent company's articles of association. The plan must be filed with the Registrar of Companies together with a declaration as to the solvency of the consolidated or surviving company, a list of the assets and liabilities of each constituent company and an undertaking that a copy of the certificate of merger or consolidation will be given to the shareholders and creditors of each constituent company and that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Court approval is not required for a merger or consolidation which is effected in compliance with these statutory procedures.

A merger between a Cayman Islands parent company and its Cayman Islands subsidiary or subsidiaries does not require authorization by a resolution of shareholders. For this purpose, a subsidiary is a company of which at least 90% of the issued shares entitled to vote are owned by the parent company.

The consent of each holder of a fixed or floating security interest of a constituent company is required unless this requirement is waived by a court in the Cayman Islands.

Except in certain limited circumstances, a dissenting shareholder of a Cayman Islands constituent company is entitled to payment of the fair value of his or her shares upon dissenting from a merger or consolidation. The exercise of such dissenter rights will preclude the exercise by the dissenting shareholder of any other rights to which he or she might otherwise be entitled by virtue of holding shares, except for the right to seek relief on the grounds that the merger or consolidation is void or unlawful.

In addition, there are statutory provisions that facilitate the reconstruction and amalgamation of companies, provided that the arrangement is approved by (a) seventy-five percent (75%) in value of the shareholders or class of shareholders, as the case may be, or (b) a majority in number representing seventy-five percent (75%) in value of the creditors or each class of creditors, as the case may be, with whom the arrangement is to be made, that are, in each case, present and voting either in person or by proxy at a meeting, or meetings, convened for that purpose. The convening of the meetings and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder has the right to express to the court the view that the transaction ought not to be approved, the Grand Court of the Cayman Islands can be expected to approve the arrangement if it determines that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the statutory provisions as to the required majority vote have been met;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the shareholders have been fairly represented at the meeting in question and the statutory majority are acting bona fide without coercion of the minority to promote interests adverse to those of the class;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the arrangement is such that may be reasonably approved by an intelligent and honest man of that class acting in respect of his interest; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the arrangement is not one that would more properly be sanctioned under some other provision of the Cayman Companies Act.

When a takeover offer is made and accepted by holders of 90% of the shares affected within four months the offeror may, within a two-month period commencing on the expiration of such four-month period, require the holders of the remaining shares to transfer such shares on the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands but this is unlikely to succeed in the case of an offer which has been so approved unless there is evidence of fraud, bad faith or collusion.

If an arrangement and reconstruction is thus approved, or if a takeover offer is made and accepted, a dissenting shareholder would have no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of Delaware corporations, providing rights to receive payment in cash for the judicially determined value of the shares.

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***Shareholders' Suits***

In principle, we will normally be the proper plaintiff to sue for a wrong done to us as a company and as a general rule, a derivative action may not be brought by a minority shareholder. However, based on English law authorities, which would in all likelihood be of persuasive authority in the Cayman Islands, the Cayman Islands courts can be expected to follow and apply the common law principles (namely the rule in Foss v. Harbottle and the exceptions thereto) so that a non-controlling shareholder may be permitted to commence a class action against or derivative actions in the name of the company to challenge:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) an act which is illegal or ultra vires with respect to the company and is therefore incapable of ratification by the shareholders;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) an act which, although not ultra vires, requires authorization by a qualified (or special) majority (that is, more than a simple majority) which has not been obtained; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) an act which constitutes a "fraud on the minority" where the wrongdoers are themselves in control of the company.

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***Indemnification of Directors and Executive Officers and Limitation of Liability***

Cayman Islands law does not limit the extent to which a company's articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Our Amended Articles provide to the extent permitted by law, we shall indemnify each existing or former secretary, director (including alternate director), and any of our other officers (including an investment adviser or an administrator or liquidator) and their personal representatives against:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by the existing or former director (including alternate director), secretary or officer in or about the conduct of our business or affairs or in the execution or discharge of the existing or former director (including alternate director), secretary's or officer's duties, powers, authorities or discretions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) without limitation to paragraph (a) above, all costs, expenses, losses or liabilities incurred by the existing or former director (including alternate director), secretary or officer in defending (whether successfully or otherwise) any civil, criminal, administrative or investigative proceedings (whether threatened, pending or completed) concerning us or our affairs in any court or tribunal, whether in the Cayman Islands or elsewhere.

No such existing or former director (including alternate director), secretary or officer, however, shall be indemnified in respect of any matter arising out of his own dishonesty.

To the extent permitted by law, we may make a payment, or agree to make a payment, whether by way of advance, loan or otherwise, for any legal costs incurred by an existing or former director (including alternate director), secretary or any of our officers in respect of any matter identified in above on condition that the director (including alternate director), secretary or officer must repay the amount paid by us to the extent that it is ultimately found not liable to indemnify the director (including alternate director), the secretary or that officer for those legal costs.

This standard of conduct is generally the same as permitted under the Delaware General Corporation Law for a Delaware corporation. In addition, we intend to enter into indemnification agreements with our directors and executive officers that will provide such persons with additional indemnification beyond that provided in our Amended Articles.

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***Anti-Takeover Provisions in Our Articles***

Some provisions of our Amended Articles may discourage, delay or prevent a change of control of our company or management that shareholders may consider favorable, including provisions that authorize our board of directors to issue shares at such times and on such terms and conditions as the board of directors may decide without any further vote or action by our shareholders, and provisions that restrict the ability of our shareholders to call meetings and to propose special matters for consideration at shareholder meetings.

However, under Cayman Islands law, our directors may only exercise the rights and powers granted to them under our Amended Articles for what they believe in good faith to be in the best interests of our company and for a proper purpose.

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***Directors' Fiduciary Duties***

Under Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders. This duty has two components: the duty of care and the duty of loyalty. The duty of care requires that a director act in good faith, with the care that an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director must inform himself of, and disclose to shareholders, all material information reasonably available regarding a significant transaction. The duty of loyalty requires that a director act in a manner he or she reasonably believes to be in the best interests of the corporation. He or she must not use his or her corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best interests of the corporation and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder and not shared by the shareholders generally. In general, actions of a director are presumed to have been made on an informed basis, in good faith and in the honest belief that the action taken was in the best interests of the corporation. However, this presumption may be rebutted by evidence of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by a director, a director must prove the procedural fairness of the transaction, and that the transaction was of fair value to the corporation.

As a matter of Cayman Islands law, a director owes three types of duties to the company: (i) statutory duties, (ii) fiduciary duties, and (iii) common law duties. The Cayman Companies Act imposes a number of statutory duties on a director. A Cayman Islands director's fiduciary duties are not codified, however the courts of the Cayman Islands have held that a director owes the following fiduciary duties (a) a duty to act in what the director bona fide considers to be in the best interests of the company, (b) a duty to exercise their powers for the purposes they were conferred, (c) a duty to avoid fettering his or her discretion in the future and (d) a duty to avoid conflicts of interest and of duty. The common law duties owed by a director are those to act with skill, care and diligence that may reasonably be expected of a person carrying out the same functions as are carried out by that director in relation to the company and, also, to act with the skill, care and diligence in keeping with a standard of care commensurate with any particular skill they have which enables them to meet a higher standard than a director without those skills. In fulfilling their duty of care to us, our directors must ensure compliance with our articles of association, as amended and restated from time to time. We have the right to seek damages if a duty owed by any of our directors is breached.'

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***Shareholder Proposals***

Under the Delaware General Corporation Law, a shareholder has the right to put any proposal before the annual meeting of shareholders, provided it complies with the notice provisions in the governing documents. The Delaware General Corporation Law does not provide shareholders an express right to put any proposal before the annual meeting of shareholders, but in keeping with common law, Delaware corporations generally afford shareholders an opportunity to make proposals and nominations provided that they comply with the notice provisions in the certificate of incorporation or bylaws. A special meeting may be called by the board of directors or any other person authorized to do so in the governing documents, but shareholders may be precluded from calling special meetings.

The Cayman Companies Act provides shareholders with only limited rights to requisition a general meeting, and does not provide shareholders with any right to put any proposal before a general meeting. However, these rights may be provided in a company's articles of association. Our Amended Articles provide that general meetings shall be convened on the written requisition of one or more of the shareholders who together hold at least ten per cent of the rights to vote at such general meeting, such requisition must be delivered in accordance with the notice provisions in the Amended Articles, specify the purpose of the meeting and be signed by or on behalf of each of the shareholders making the requisition (and for this purpose each joint holder shall be obliged to sign). If the directors do not convene such meeting for a date not later than twenty-one clear days' after the date of receipt of the written requisition, those shareholders who requested the meeting may convene the general meeting themselves within three months after the end of such period of twenty-one clear days in which case reasonable expenses incurred by them as a result of the directors failing to convene a meeting shall be reimbursed by us. Our Amended Articles provide no other right to put any proposals before annual general meetings or extraordinary general meetings. As a Cayman Islands exempted company, we are not obligated by law to call shareholders' annual general meetings.

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***Cumulative Voting***

Under the Delaware General Corporation Law, cumulative voting for elections of directors is not permitted unless the corporation's certificate of incorporation specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders on a board of directors since it permits the minority shareholder to cast all the votes to which the shareholder is entitled on a single director, which increases the shareholder's voting power with respect to electing such director. As permitted under the Cayman Companies Act, our Amended Articles do not provide for cumulative voting. As a result, our shareholders are not afforded any less protections or rights on this issue than shareholders of a Delaware corporation.

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***Removal of Directors***

Under the Delaware General Corporation Law, a director of a corporation with a classified board may be removed only for cause with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Subject to the provisions of our Amended Articles (which include the removal of a director by ordinary resolution (being a resolution of a general meeting passed by a simple majority of shareholders who, being entitled to do so, vote in person or by proxy at that meeting, or by a unanimous written resolution), the office of a director may be terminated forthwith if (a) he is prohibited by the laws of the Cayman Islands from acting as a director, (b) he is made bankrupt or makes an arrangement or composition with his creditors generally, (c) he resigns his office by notice to us, (d) he only held office as a director for a fixed term and such term expires, (e) in the opinion of a registered medical practitioner by whom he is being treated he becomes physically or mentally incapable of acting as a director, (f) he is given notice by the majority of the other directors (not being less than two in number) to vacate office (without prejudice to any claim for damages for breach of any agreement relating to the provision of the services of such director), (g) he is made subject to any law relating to mental health or incompetence, whether by court order or otherwise, or (h) without the consent of the other directors, he is absent from meetings of directors for continuous period of six months.

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***Transactions with Interested Shareholders***

The Delaware General Corporation Law contains a business combination statute applicable to Delaware public corporations whereby, unless the corporation has specifically elected not to be governed by such statute by amendment to its certificate of incorporation or bylaws that is approved by its shareholders, it is prohibited from engaging in certain business combinations with an "interested shareholder" for three years following the date that such person becomes an interested shareholder. An interested shareholder generally is a person or a group who or which owns or owned 15% or more of the target's outstanding voting stock or who or which is an affiliate or associate of the corporation and owned 15% or more of the corporation's outstanding voting stock within the past three years. This has the effect of limiting the ability of a potential acquirer to make a two-tiered bid for the target in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination or the transaction which resulted in the person becoming an interested shareholder. This encourages any potential acquirer of a Delaware corporation to negotiate the terms of any acquisition transaction with the target's board of directors.

The Cayman Islands has no comparable statute. As a result, we cannot avail ourselves of the types of protections afforded by the Delaware business combination statute. However, although the Cayman Companies Act does not regulate transactions between a company and its significant shareholders, under Cayman Islands law such transactions must be entered into bona fide in the best interests of the company and for a proper corporate purpose and not with the effect of constituting a fraud on the minority shareholders.

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***Dissolution; Winding Up***

Under the Delaware General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution must be approved by shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors may it be approved by a simple majority of the corporation's outstanding shares. Delaware law allows a Delaware corporation to include in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board of directors.

Under the Cayman Companies Act, the Company may be wound up by a special resolution of our shareholders, or, if our company is unable to pay its debts as they fall due, by an ordinary resolution of our members. In addition, a company may be wound up by an order of the courts of the Cayman Islands. The court has authority to order winding up in a number of specified circumstances including where it is, in the opinion of the court, just and equitable to do so.

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***Variation of Rights of Shares***

Under the Delaware General Corporation Law, a corporation may vary the rights of a class of shares with the approval of a majority of the outstanding shares of such class, unless the certificate of incorporation provides otherwise. Under the Cayman Companies Act and our Amended Articles, if our share capital is divided into more than one class of shares, the rights attaching to any class of share (unless otherwise provided by the terms of issue of the shares of that class) may be varied if one of the following applies: (i) the shareholders holding not less than two-thirds of the issued shares of that class consent in writing to the variation; or (ii) the variation is made with the sanction of a resolution passed by a majority of not less than two-thirds of the holders of shares of the class present in person or by proxy at a separate general meeting of the holders of shares of that class.

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***Amendment of Governing Documents***

Under the Delaware General Corporation Law, a corporation's certificate of incorporation may be amended only if adopted and declared advisable by the board of directors and approved by a majority of the outstanding shares entitled to vote, and the bylaws may be amended with the approval of a majority of the outstanding shares entitled to vote and may, if so provided in the certificate of incorporation, also be amended by the board of directors. Under the Cayman Companies Act, our articles may only be amended by special resolution of our shareholders.

**Anti-money Laundering—Cayman Islands**

In order to comply with legislation or regulations aimed at the prevention of money laundering and count terrorist financing, we may be required to adopt and maintain anti-money laundering and counter terrorist financing policies and procedures, and may require subscribers to provide evidence to satisfactorily identify and verify their identity and source of funds. Such customer due diligence can be simplified or enhanced depending on the risk rating given to the subscriber Where permitted, and subject to certain conditions, we may also delegate the maintenance of our anti-money laundering and counter terrorist financing policies and procedures (including the acquisition of due diligence information) to suitable third persons in Cayman Islands approved equivalent jurisdictions.

We reserve the right to request such information as is necessary to identify and verify the identity of a subscriber. In the event of delay or failure on the part of the subscriber in producing any information required for identification or verification purposes, we may refuse to accept the application, in which case any funds received will be returned without interest to the account from which they were originally debited.

We also reserve the right to refuse to make any redemption payment to a shareholder if our directors or officers suspect or are advised that the payment of redemption proceeds to such shareholder might result in a breach of applicable anti-money laundering, counter terrorist financing or other applicable laws, regulations or guidance by any person in any equivalent jurisdiction, or if such refusal is considered necessary or appropriate to ensure our compliance with any such laws or regulations in any applicable jurisdiction.

If any person resident in the Cayman Islands knows or suspects or has reason for knowing or suspecting that another person is engaged in criminal conduct or is involved with terrorism or terrorist property and the information for that knowledge or suspicion came to their attention in the course of their business in the regulated sector, or other trade, profession, business or employment, the person will be required to report such knowledge or suspicion to (i) a nominated officer (appointed in accordance with the Proceeds of Crime Act (Revised) of the Cayman Islands) or the Financial Reporting Authority of the Cayman Islands, pursuant to the Proceeds of Crime Act (Revised), if the disclosure relates to criminal conduct or money laundering or (ii) to the Financial Reporting Authority or a police constable or a nominated officer (pursuant to the Terrorism Act (Revised) of the Cayman Islands) or the Financial Reporting Authority, pursuant to the Terrorism Act (Revised), if the disclosure relates to involvement with terrorism or terrorist financing and terrorist property. Such a report shall not be treated as a breach of confidence or of any restriction upon the disclosure of information imposed by any enactment or otherwise. By subscribing for shares, the subscriber consents to the disclosure of any information about them to regulators and others upon request in connection with money laundering and similar matters in the Cayman Islands and in other jurisdictions.

**Data Protection in the Cayman Islands – Privacy Notice**

This privacy notice explains the manner in which the Company collects, processes and maintains personal data about investors of the Company pursuant to the Data Protection Act (Revised) of the Cayman Islands, as amended from time to time and any regulations, codes of practice or orders promulgated pursuant thereto ("DPA").

The Company is committed to processing personal data in accordance with the DPA. In its use of personal data, the Company will be characterized under the DPA as a 'data controller', whilst certain of the Company's service providers, affiliates and delegates may act as 'data processors' under the DPA. These service providers may process personal information for their own lawful purposes in connection with services provided to the Company.

By virtue of making an investment in the Company, the Company and certain of the Company's service providers may collect, record, store, transfer and otherwise process personal data by which individuals may be directly or indirectly identified.

Your personal data will be processed fairly and for lawful purposes, including (a) where the processing is necessary for the Company to perform a contract to which you are a party or for taking pre-contractual steps at your request (b) where the processing is necessary for compliance with any legal, tax or regulatory obligation to which the Company is subject or (c) where the processing is for the purposes of legitimate interests pursued by the Company or by a service provider to whom the data are disclosed. As a data controller, we will only use your personal data for the purposes for which we collected it. If we need to use your personal data for an unrelated purpose, we will contact you.

We anticipate that we will share your personal data with the Company's service providers for the purposes set out in this privacy notice. We may also share relevant personal data where it is lawful to do so and necessary to comply with our contractual obligations or your instructions or where it is necessary or desirable to do so in connection with any regulatory reporting obligations. In exceptional circumstances, we will share your personal data with regulatory, prosecuting and other governmental agencies or departments, and parties to litigation (whether pending or threatened), in any country or territory including to any other person where we have a public or legal duty to do so (e.g. to assist with detecting and preventing fraud, tax evasion and financial crime or compliance with a court order).

Your personal data shall not be held by the Company for longer than necessary with regard to the purposes of the data processing.

We will not sell your personal data. Any transfer of personal data outside of the Cayman Islands shall be in accordance with the requirements of the DPA. Where necessary, we will ensure that separate and appropriate legal agreements are put in place with the recipient of that data.

The Company will only transfer personal data in accordance with the requirements of the DPA, and will apply appropriate technical and organizational information security measures designed to protect against unauthorized or unlawful processing of the personal data and against the accidental loss, destruction or damage to the personal data.

If you are a natural person, this will affect you directly. If you are a corporate investor (including, for these purposes, legal arrangements such as trusts or exempted limited partnerships) that provides us with personal data on individuals connected to you for any reason in relation to your investment into the Company, this will be relevant for those individuals and you should inform such individuals of the content.

You have certain rights under the DPA, including (a) the right to be informed as to how we collect and use your personal data (and this privacy notice fulfils the Company's obligation in this respect) (b) the right to obtain a copy of your personal data (c) the right to require us to stop direct marketing (d) the right to have inaccurate or incomplete personal data correct (e) the right to withdraw your consent and require us to stop processing or restrict the processing, or not begin the processing of your personal data (f) the right to be notified of a data breach (unless the breach is unlikely to be prejudicial) (g) the right to obtain information as to any countries or territories outside the Cayman Islands to which we, whether directly or indirectly, transfer, intend to transfer or wish to transfer your personal data, general measures we take to ensure the security of personal data and any information available to us as to the source of your personal data (h) the right to complain to the Office of the Ombudsman of the Cayman Islands and (i) the right to require us to delete your personal data in some limited circumstances.

If you consider that your personal data has not been handled correctly, or you are not satisfied with the Company's responses to any requests you have made regarding the use of your personal data, you have the right to complain to the Cayman Islands' Ombudsman. The Ombudsman can be contacted by calling +1 (345) 946-6283 or by email at info@ombudsman.ky.

C. <u>Material Contracts</u>

We have not entered into any material contracts other than in the ordinary course of business and other than those described in this Annual Report.

D. <u>Exchange Controls</u>

Under Cayman Islands law, there are currently no restrictions on the export or import of capital, including foreign exchange controls or restrictions that affect the remittance of dividends, interest or other payments to nonresident holders of our shares.

E. <u>Taxation</u>

*The following summary of the material Cayman Islands, Hong Kong and U.S. federal income tax consequences of an investment in our Ordinary Shares is based upon laws and relevant interpretations thereof in effect as of the date of this Annual Report, all of which are subject to change. This summary does not deal with all possible tax consequences relating to an investment in our Ordinary Shares, such as the tax consequences under state, local and other tax laws.*

**Cayman Islands Taxation**

The Cayman Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to our company levied by the government of the Cayman Islands, except for stamp duties which may be applicable on instruments executed in, or, after execution, brought within the jurisdiction of the Cayman Islands. The Cayman Islands is not party to any double tax treaties that are applicable to any payments made to or by our company. There are no exchange control regulations or currency restrictions in the Cayman Islands.

Payments of dividends and capital in respect of our Ordinary Shares will not be subject to taxation in the Cayman Islands and no withholding will be required on the payment of a dividend or capital to any holder of our Ordinary Shares, nor will gains derived from the disposal of our Ordinary Shares be subject to Cayman Islands income or corporation tax.

**Hong Kong Taxation** 

The following summary of certain relevant taxation provisions under the laws of Hong Kong is based on current law and practice and is subject to changes therein. This summary does not purport to address all possible tax consequences relating to purchasing, holding or selling our Ordinary Shares, and does not take into account the specific circumstances of any particular investors, some of whom may be subject to special rules. Accordingly, holders or prospective purchasers (particularly those subject to special tax rules, such as banks, dealers, insurance companies and tax-exempt entities) should consult their own tax advisors regarding the tax consequences of purchasing, holding or selling our Ordinary Shares. Under the current laws of Hong Kong:

● No profit tax is imposed in Hong Kong in respect of capital gains from the sale of our Ordinary Shares.

● Revenue gains from the sale of our Ordinary Shares by persons carrying on a trade, profession or business in Hong Kong where the gains are derived from or arise in Hong Kong from the trade, profession or business will be chargeable to Hong Kong profits tax, which is currently imposed at the rate of 16.5% and 15% on corporations and unincorporated businesses, respectively, and at a maximum rate of 15% on individuals. A two-tiered profits tax rates regime applies: 8.25% for corporation and 7.5% for unincorporated businesses and individuals on the first HK$2 million of assessable profit, and 16.5% for corporation and 15% for unincorporated businesses and individuals on the remainder of assessable profits.

● Gains arising from the sale of our Ordinary Shares, where the purchases and sales of our Ordinary Shares are effected outside of Hong Kong such as, for example, on the Cayman Islands, should not be subject to Hong Kong profits tax.

According to the current tax practice of the Hong Kong Inland Revenue Department, dividends paid on our Ordinary Shares would not be subject to any Hong Kong tax.

No Hong Kong stamp duty is payable on the purchase and sale of our Ordinary Shares.

**Material U.S. Federal Income Tax Considerations**

The following is a summary of certain material U.S. federal income tax consequences to U.S. Holders (defined below) of the ownership and disposition of our Ordinary Shares. For purposes of this summary, a "U.S. Holder" means a beneficial owner of our Ordinary Shares that is for U.S. federal income tax purposes:

● an individual citizen or resident of the United States;

● a corporation (or other entity classified as a corporation for U.S. federal income tax purposes) that is created or organized in or under the laws of the United States, any state thereof or the District of Columbia;

● an estate the income of which is subject to U.S. federal income taxation regardless of its source; or

● a trust if (i) a U.S. court can exercise primary supervision over the trust's administration and one or more United States persons (as defined in Section 7701(a)(30) of the Code (defined below)) are authorized to control all substantial decisions of the trust, or (ii) it has a valid election in effect under applicable U.S. Treasury regulations to be treated as a United States person.

This summary is based on the Internal Revenue Code of 1986, as amended (the "Code"), as in effect on the date of this Annual Report and on U.S. Treasury regulations in effect or, in some cases, proposed, as of the date of this annual report, as well as judicial and administrative interpretations thereof available on or before such date. These authorities are subject to change or differing interpretations, possibly on a retroactive basis.

This discussion does not address all aspects of U.S. federal income taxation that may be relevant to a U.S. Holder based on such U.S. Holder's individual circumstances. In particular, this discussion considers only U.S. Holders that own our Ordinary Shares as capital assets within the meaning of Section 1221 of the Code (generally, property held for investment). This discussion also does not address the potential application of any alternative minimum tax, the Medicare contribution tax on certain net investment income, or the U.S. federal income tax consequences to U.S. Holders that are subject to special rules, including:

● banks, financial institutions or financial services entities;

● brokers, dealers or traders in securities, commodities or currencies;

● persons who have elected mark-to-market accounting;

● tax-exempt entities or organizations;

● "individual retirement accounts" or "Roth IRAs";

● governments or agencies or instrumentalities thereof;

● insurance companies;

● regulated investment companies;

● real estate investment trusts;

● certain expatriates or former long-term residents of the United States;

● persons that actually or constructively own 5% or more, by voting power or value, of our outstanding Ordinary Shares;

● persons that acquired our Ordinary Shares pursuant to the exercise of employee share options, in connection with employee share incentive plans or otherwise as compensation;

● persons that hold our Ordinary Shares in connection with a trade or business outside the United States;

● persons that hold our Ordinary Shares as part of a straddle, constructive sale, hedging, conversion or other integrated transaction; or

● persons whose functional currency is not the U.S. dollar.

This discussion does not address any aspect of U.S. federal non-income tax laws, such as gift or estate tax laws, or state, local or non-U.S. tax laws. Additionally, this discussion does not consider the tax treatment of entities or arrangements classified as partnerships for U.S. federal income tax purposes or other pass-through entities or persons who hold our Ordinary Shares through such entities or arrangements. If a partnership (or other entity or arrangement classified as a partnership for U.S. federal income tax purposes) is the beneficial owner of our Ordinary Shares, the U.S. federal income tax treatment of a partner in the partnership will generally depend on the status of the partner and the activities of the partnership. Such a partner or partnership should consult its tax advisor as to the particular U.S. federal income tax consequences of acquiring, owning and disposing of our ordinary shares in its particular circumstance. This discussion also assumes that any distribution made (or deemed made) in respect of our Ordinary Shares and any consideration received (or deemed received) by a U.S. Holder in connection with the sale or other disposition of such shares will be in U.S. dollars.

We have not sought, and will not seek, a ruling from the U.S. Internal Revenue Service (or "IRS"), or an opinion of counsel as to any U.S. federal income tax consequence described herein. The IRS may disagree with one or more aspects of the discussion herein, and its determination may be upheld by a court. Moreover, there can be no assurance that future legislation, regulations, administrative rulings or court decisions will not adversely affect the accuracy of the statements in this discussion.

BECAUSE OF THE COMPLEXITY OF THE TAX LAWS AND BECAUSE THE TAX CONSEQUENCES TO ANY PARTICULAR HOLDER OF OUR ORDINARY SHARES MAY BE AFFECTED BY MATTERS NOT DISCUSSED HEREIN, EACH HOLDER OF OUR ORDINARY SHARES IS URGED TO CONSULT WITH ITS TAX ADVISOR WITH RESPECT TO THE SPECIFIC TAX CONSEQUENCES OF THE OWNERSHIP AND DISPOSITION OF OUR ORDINARY SHARES, INCLUDING THE APPLICABILITY AND EFFECT OF STATE, LOCAL AND NON-U.S. TAX LAWS, AS WELL AS U.S. FEDERAL TAX LAWS AND ANY APPLICABLE TAX TREATIES.

THERE IS A SIGNIFICANT RISK THAT WE WERE A PFIC FOR OUR TAXABLE YEAR ENDING JUNE 30, 2025.

***Passive Foreign Investment Company***

A non-U.S. corporation will be classified as a passive foreign investment company (a "PFIC") for U.S. federal income tax purposes for any taxable year in which, after applying certain look-through rules, either:

● at least 75% of its gross income is passive income; or

● at least 50% of its assets (generally based on an average of the quarterly values of the assets during a taxable year) is attributable to assets that produce or are held for the production of passive income.

For purposes of the above calculations, a non-U.S. corporation will be treated as owning its proportionate share of the assets and earning its proportionate share of the income of any other corporation in which it owns, directly or indirectly, 25% or more (by value) of the equity. Passive income generally includes dividends, interest, certain rents or royalties, foreign currency or other investment gains and certain other categories of income. Assets that produce or are held for the production of passive income generally include cash, even if held as working capital, and other assets that may produce passive income. A separate determination must be made after the close of each taxable year as to whether we were a PFIC for that year.

Based on the composition of our income and assets for our taxable year ended June 30, 2025, we believe we were a PFIC for such taxable year due to the amount of interest income we received relative to other income we received during such taxable year. The application of the PFIC rules is subject to uncertainty, and the IRS or a court may disagree with our determinations, including the manner in which we determine the value of our assets, the percentage of our assets that are passive assets and the classification of certain of our income as active or passive under the PFIC rules. Furthermore, the characterization of our assets as active or passive may depend in part on our current and intended future business plans, which are subject to change. In addition, the total value of our assets for PFIC testing purposes may be determined in part by reference to the market price of Ordinary Shares from time to time, which may fluctuate considerably. Therefore, there can be no assurance regarding our PFIC status for our prior taxable year, our current taxable year or for any future taxable year. We are under no obligation to take steps to reduce the risk of our being classified as a PFIC, and as stated above, the determination of the value of our assets will depend upon material facts (including the market price of our Ordinary Shares from time to time) that may not be within our control.

If we are a PFIC for any taxable year during which you hold Ordinary Shares, we will generally continue to be treated as a PFIC with respect to you for all succeeding taxable years during which you hold Ordinary Shares. If we cease to be a PFIC and you did not previously make a timely "mark-to-market" election as described below, however, you may avoid some of the adverse effects of the PFIC regime by making a "purging election" (as described below) with respect to the Ordinary Shares.

If we are a PFIC for any taxable year during which you hold Ordinary Shares, you will generally be subject to special tax rules with respect to any "excess distribution" that you receive and any gain you realize from a sale or other disposition (including a pledge) of the Ordinary Shares, unless you make a "mark-to-market" election as discussed below. Distributions you receive in a taxable year that are greater than 125% of the average annual distributions you received during the shorter of the three preceding taxable years or your holding period for the Ordinary Shares will be treated as an excess distribution. Under these special tax rules:

● the excess distribution or gain will be allocated ratably over your holding period for the Ordinary Shares;

● the amount allocated to the current taxable year, and any taxable year prior to the first taxable year in which we were a PFIC, will be treated as ordinary income, and

● the amount allocated to each other taxable year will be subject to the highest tax rate in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year.

The tax liability for amounts allocated to taxable years prior to the year of disposition or "excess distribution" cannot be offset by any net operating losses for such years, and gains (but not losses) realized on the sale of the Ordinary Shares cannot be treated as capital, even if you hold the Ordinary Shares as capital assets.

A U.S. Holder of "marketable stock" (as defined below) in a PFIC may make a mark-to-market election for such stock to elect out of the tax treatment discussed above. If you make a mark-to-market election for the Ordinary Shares, you will include in income each taxable year an amount equal to the excess, if any, of the fair market value of the Ordinary Shares as of the close of your taxable year over your adjusted basis in such Ordinary Shares. You are allowed a deduction for the excess, if any, of the adjusted basis of the Ordinary Shares over their fair market value as of the close of the taxable year. However, deductions are allowable only to the extent of any net mark-to-market gains on the Ordinary Shares included in your income for prior taxable years. Amounts included in your income under a mark-to-market election, as well as gain on the actual sale or other disposition of the Ordinary Shares, are treated as ordinary income. Ordinary loss treatment also applies to the deductible portion of any mark-to-market loss on the Ordinary Shares, as well as to any loss realized on the actual sale or disposition of the Ordinary Shares, to the extent that the amount of such loss does not exceed the net mark-to-market gains previously included for such Ordinary Shares. Your basis in the Ordinary Shares will be adjusted to reflect any such income or loss amounts. If you make a valid mark-to-market election, the tax rules that apply to distributions as discussed below under "—Taxation of Distributions Paid on Ordinary Shares" would generally apply, except that the lower applicable capital gains rate for qualified dividend income discussed therein generally would not apply.

The mark-to-market election is available only for "marketable stock," which is stock that is traded in other than de minimis quantities on at least 15 days during each calendar quarter ("regularly traded") on a qualified exchange or other market (as defined in applicable U.S. Treasury regulations), including the Nasdaq Capital Market. If the Ordinary Shares are regularly traded on the Nasdaq Capital Market and if you are a holder of Ordinary Shares, the mark-to-market election would generally be available to you if we are or become a PFIC.

Alternatively, a U.S. Holder of stock in a PFIC may, at taxpayer's discretion, make a "qualified electing fund" election with respect to such PFIC to elect out of the tax treatment discussed above. A U.S. Holder who makes a valid qualified electing fund election with respect to a PFIC will generally include in gross income for a taxable year such U.S. Holder's pro rata share of the corporation's earnings and profits for the taxable year. However, the qualified electing fund election is available only if such PFIC provides such U.S. Holder with certain information regarding its earnings and profits as required under applicable U.S. Treasury regulations. We do not currently intend to prepare or provide the information that would enable you to make a qualified electing fund election. If you hold Ordinary Shares in any year in which we are a PFIC, you will generally be required to file IRS Form 8621 regarding distributions received on the Ordinary Shares and any gain realized on the disposition of the Ordinary Shares.

If you do not make a timely "mark-to-market" election (as described above), and if we are a PFIC at any time during the period you hold our Ordinary Shares, then such Ordinary Shares will continue to be treated as stock of a PFIC with respect to you even if we cease to be a PFIC in a future taxable year, unless you make a "purging election" for the year we cease to be a PFIC. A "purging election" creates a deemed sale of such Ordinary Shares at their fair market value on the last day of the last taxable year in which we are treated as a PFIC. The gain recognized by the purging election will be subject to the special tax and interest charge rules treating the gain as an excess distribution, as described above. As a result of the purging election, you will have a new basis (equal to the fair market value of the Ordinary Shares on the last day of the last taxable year in which we are treated as a PFIC) and holding period (which new holding period will begin the day after such last day) in your Ordinary Shares for U.S. federal income tax purposes.

If we are treated as a PFIC with respect to you for any taxable year, to the extent any of our subsidiaries are also PFICs ("lower-tier PFICs"), you generally will be deemed to own shares in such lower-tier PFICs that are directly or indirectly owned by us in that proportion which the value of the Ordinary Shares you own bears to the value of all of our Ordinary Shares, and you generally will be subject to the adverse tax consequences described above with respect to the shares of such lower-tier PFICs that you would be deemed to own. However, an election for mark-to-market treatment would likely not be available with respect to any such lower-tier PFICs. You should consult your tax advisors regarding the availability and desirability of a mark-to-market election as well as the impact of such election on interests in any lower-tier PFICs.

If we are considered a PFIC, a U.S. Holder will also be subject to information reporting requirements on an annual basis. If we are or become a PFIC, you should consult your tax advisor regarding any reporting requirements that may apply to you.

U.S. HOLDERS ARE STRONGLY URGED TO CONSULT THEIR TAX ADVISORS REGARDING THE IMPACT OF OUR BEING A PFIC FOR OUR TAXABLE YEAR ENDED JUNE 30, 2025 OR THE CURRENT TAXABLE YEAR OR ANY FUTURE TAXABLE YEAR AND WITH RESPECT TO THE OPERATION OF THE PFIC RULES AND RELATED REPORTING REQUIREMENTS IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, INCLUDING THE ADVISABILITY AND EFFECTS OF MAKING ANY ELECTION THAT MAY BE AVAILABLE.

***Taxation of Distributions Paid on Ordinary Shares***

Subject to the PFIC rules discussed above, the gross amount of distributions made by us to you with respect to the Ordinary Shares (including the amount of any taxes withheld therefrom) will generally be includable in your gross income as dividend income on the date of receipt by you, but only to the extent that the distribution is paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). To the extent that the amount of the distribution exceeds our current and accumulated earnings and profits (as determined under U.S. federal income tax principles), it will be treated first as a tax-free return of your tax basis in your Ordinary Shares, and to the extent the amount of the distribution exceeds your tax basis, the excess will be taxed as capital gain. However, we do not intend to calculate our earnings and profits under U.S. federal income tax principles. Therefore, a U.S. Holder should expect that a distribution will be treated as a dividend even if that distribution would otherwise be treated as a non-taxable return of capital or as capital gain under the rules described above. With respect to corporate U.S. Holders, the dividends will not be eligible for the dividends-received deduction allowed to corporations in respect of dividends received from other U.S. corporations.

With respect to non-corporate U.S. Holders, including individual U.S. Holders, dividends will generally be taxed at the lower capital gains rate applicable to qualified dividend income, provided that (1) the Ordinary Shares are readily tradable on an established securities market in the United States (including the NASDAQ Capital Market), or we are eligible for the benefits of an approved qualifying income tax treaty with the United States that includes an exchange of information program, (2) we are not a PFIC with respect to such U.S. Holder for either our taxable year in which the dividend is paid or the preceding taxable year, and (3) certain holding period requirements are met. Because there is no income tax treaty between the United States and the Cayman Islands, it is expected that clause (1) above can be satisfied only if the Ordinary Shares are readily tradable on an established securities market in the United States. You are urged to consult your tax advisors regarding the availability of the lower rate for dividends paid with respect to our Ordinary Shares, including the effects of any change in law after the date of this Annual Report.

Dividends will constitute foreign source income for foreign tax credit limitation purposes. If the dividends are taxed as qualified dividend income (as discussed above), the amount of the dividend considered for purposes of calculating the foreign tax credit limitation will be limited to the gross amount of the dividend, multiplied by the reduced rate divided by the highest rate of tax normally applicable to dividends. The limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. For this purpose, dividends distributed by us with respect to our Ordinary Shares will generally constitute "passive category income" but could, in the case of certain U.S. Holders, constitute "general category income." A U.S. Holder that does not elect to claim a foreign tax credit with respect to any foreign taxes for a given taxable year may instead claim an itemized deduction for all foreign taxes paid or accrued in that taxable year. The rules governing the U.S. foreign tax credit are complex, and you should consult your tax advisors to determine whether and to what extent a credit would be available in your particular circumstances, including the effects of any applicable income tax treaty.

***Taxation of Dispositions of Ordinary Shares***

Subject to the PFIC rules discussed above, you will generally recognize taxable gain or loss on any sale, exchange or other taxable disposition of an Ordinary Share equal to the difference between the amount realized (in U.S. dollars) for the Ordinary Share and your adjusted tax basis (in U.S. dollars) in the Ordinary Share. The gain or loss will be capital gain or loss. If you are a non-corporate U.S. Holder, including an individual U.S. Holder, who has held the Ordinary Shares for more than one year, you will generally be eligible for reduced tax rates. The deductibility of capital losses may be subject to limitations. Any such gain or loss that you recognize will generally be treated as United States source income or loss for foreign tax credit limitation purposes.

 

*Backup Withholding Tax and Information Reporting Requirements* 

Dividends on and the proceeds of a sale or other taxable disposition of Ordinary Shares may be subject to information reporting to the IRS and possible U.S. backup withholding. Backup withholding will not apply to a U.S. Holder who furnishes a correct taxpayer identification number and makes any other required certification or who is otherwise exempt from backup withholding. U.S. Holders who are required to establish their exempt status can provide such certification on IRS Form W-9. U.S. Holders should consult their tax advisors regarding the application of the U.S. information reporting and backup withholding rules.

Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a U.S. Holder's U.S. federal income tax liability, and a U.S. Holder may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for refund with the IRS and furnishing any required information.

*Additional Reporting Requirements* 

Individuals (and certain entities) that own "specified foreign financial assets" with an aggregate value in excess of certain thresholds on the last day of the taxable year (or with an aggregate value in excess of certain thresholds at any time during the taxable year) are generally required to file an information report on IRS Form 8938 with respect to such assets with their U.S. federal income tax returns. "Specified foreign financial assets" include any financial accounts maintained by foreign financial institutions, as well as any of the following, but only if they are not held in accounts maintained by certain financial institutions: (1) stocks and securities issued by non-U.S. persons, (2) financial instruments and contracts held for investment that have non-U.S. issuers or counterparties, and (3) interests in foreign entities. The Ordinary Shares may be subject to these rules. U.S. Holders are urged to consult their tax advisors regarding the application of these rules to their ownership of the Ordinary Shares.

F. <u>Dividends and Paying Agents</u>

Not applicable.

G. <u>Statement by Experts</u>

Not applicable.

H. <u>Documents on Display</u>

We are subject to the periodic reporting and other informational requirements of the Exchange Act. Under the Exchange Act, we are required to file reports and other information with the SEC. Specifically, we are required to file annually a Form 20-F within four months after the end of each fiscal year. We have filed this Annual Report on Form 20-F, including exhibits, and furnished other current reports, with the SEC. As allowed by the SEC, in Item 19 of this Annual Report, we incorporate by reference certain information we filed with the SEC. This means that we can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is considered to be part of this Annual Report.

You may read and copy this Annual Report, including the exhibits incorporated by reference in this Annual Report, and our reports and other information, when so filed, at the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549 and at the SEC's regional offices in New York, New York and Chicago, Illinois. You also can request copies of this Annual Report, including the exhibits incorporated by reference in this Annual Report, and our reports and other information, upon payment of a duplicating fee, by writing information on the operation of the SEC's Public Reference Room.

The SEC also maintains a website at www.sec.gov that contains reports, proxy statements and other information regarding registrants that are filed electronically with the SEC. Our annual reports and some of the other information filed by us with the SEC may be accessed through this website.

As a foreign private issuer, we are exempt from the rules under the Exchange Act prescribing the furnishing and content of quarterly reports and proxy statements, and officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act. In addition, we are not required under the Exchange Act to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act.

Our financial statements have been prepared in accordance with U.S. GAAP.

We will furnish our shareholders with annual reports, which will include a review of operations and annual audited consolidated financial statements prepared in conformity with U.S. GAAP.

I. <u>Subsidiary Information</u>

Not applicable.

J. <u>Annual Report to Security Holders</u>

Not applicable.

**Item 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

*For purposes of this Item 11, reference to the "Group" means Regencell Bioscience Holdings Limited and all of its subsidiaries.*

**Foreign Exchange Risk**

Currency risk is the risk that the value of financial assets or liabilities will fluctuate due to changes in foreign exchange rates.

As of June 30, 2025, 2024 and 2023, the Group has no significant foreign currency risk because most of the transactions are denominated in Hong Kong dollar or the United States dollar. Since Hong Kong dollar is pegged to the United States dollar, the Group's exposure to foreign currency risk in respect of the balances denominated in Hong Kong dollars is considered to be minimal.

**Credit Risk**

Financial assets which potentially subject the Group to concentrations of credit risk consist principally of bank deposits and balances.

The Group limits its exposure to credit risk by transacting all of its securities and contractual commitment activities with broker-dealers, banks and regulated exchanges with high credit ratings and that the Group considers to be well established.

**Liquidity Risk**

Liquidity risk is the risk that the Group will encounter difficulty in raising funds to meet commitments associated with financial assets and liabilities. Liquidity risk may result from an inability to sell a financial asset quickly at an amount close to its fair value. The Company's strategy is to minimize its exposure to liquidity risk by monitoring its liquid capital from time to time. In managing its liquidity risk, the Company monitors and maintains a level of cash and bank balances deemed adequate by management to finance the Company's operations.

**Interest Rate Risk**

Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments.

The Group's cash held with the banks are exposed to interest rate risk. However, our management considers the risk to be minimal as they are short-term with terms less than one month.

**Inflation Risk**

In recent years, inflation has not had a material impact on our results of operations.

**Item 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES**

Not applicable.

**Part II**

**Item 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES**

None.

**Item 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS**

See "Item 10. Additional Information" for a description of the rights of securities holders, which remain unchanged.

**Use of Proceeds**

The following "Use of Proceeds" information relates to the Registration Statement on Form F-1, as amended (File Number: 333-254571) which was declared effective by the SEC on July 15, 2021 and was in relation to our IPO of 87,400,000 (after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares, and 12,350,000 (after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares sold in the over-allotment in the IPO, at the offering price of $0.25 (after giving retroactive effect to the 38-for-1 forward stock split) per Ordinary Share. Our IPO closed in July 2021. Maxim Group LLC is the representative of the underwriter and sole book-running manager for our IPO. Gross proceeds from our IPO, including proceeds from the exercise of the over-allotment option, totaled approximately $24.93 million, before deducting underwriting discounts and other related expenses. We have also agreed to issue to the representative of the underwriter for our IPO warrants to purchase 2,493,750 (after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares of our company.

From the effective date of the registration statement on Form F-1 to June 30, 2025, the ending date of the reporting period of this Annual Report, our expenses incurred and paid to others in connection with the issuance and distribution of our Ordinary Shares in our IPO totaled $2.26 million, which included $1.83 million for underwriting discounts and commissions and $0.43 million for other expenses. None of the transaction expenses included any direct or indirect payments to directors or officers of our company or their associates, persons owning more than 10% or more of our equity securities or our affiliates.

We received net proceeds of approximately $22.67 million from our IPO, including the exercise of over-allotment option, after deducting these total expenses.

From the effective date of the registration statement on Form F-1 to June 30, 2025, the ending date of the reporting period of this Annual Report, we used approximately $6.95 million for staff salaries; approximately $2.82 million for general and administrative expenses, marketing, research and development and potential expansion of new businesses, approximately $3.96 million for facilities rental, renovations and equipment; approximately $1.59 million for research study; approximately $0.02 million for product and intellectual properties registration; approximately $2.61 million for working capital and other general corporate purposes; and approximate $0.44 million to repay our shareholder loan with Mr. Yat-Gai Au. Other than as disclosed above, none of the net proceeds from our IPO were paid, directly or indirectly, to any of our directors, officers or their associates, persons owning 10% or more of our equity securities or our affiliates.

As of June 30, 2025, $4.28 million of the net proceeds from our IPO remained unused. We have placed the remaining net proceeds from our IPO in our savings account and short-term investment. We still intend to continue to use the net proceeds from our IPO as disclosed in our registration statements on Form F-1.

**Item 15. CONTROLS AND PROCEDURES**

**Disclosure Controls and Procedures**

Our management, with the participation of our chief executive officer and our financial controller, has performed an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of the end of the period covered by this Annual Report, as required by Rule 13a-15(b) under the Exchange Act. Based on that evaluation, our management has concluded that our disclosure controls and procedures were not effective as of June 30, 2025 because of the material weaknesses in our internal control over financial reporting identified, as described in "Management's Annual Report on Internal Control over Financial Reporting" below.

**Management's Annual Report on Internal Control over Financial Reporting**

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15 (f) under the Exchange Act, for our company. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements in accordance with generally accepted accounting principles and includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of a company's assets, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting principles, and that a company's receipts and expenditures are being made only in accordance with authorizations of a company's management and directors, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of a company's assets that could have a material effect on the consolidated financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

As required by Section 404 of the Sarbanes-Oxley Act and related rules as promulgated by the SEC, our management assessed the effectiveness of our internal control over financial reporting as of June 30, 2025 using criteria established in "Internal Control—Integrated Framework (2013)" issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on this assessment, our management has concluded that our internal control over financial reporting was ineffective as of June 30, 2025, due to the material weaknesses in our internal control over financial reporting identified.

In connection with the preparation and audit of our consolidated financial statements as of and for the year ended June 30, 2025, our management identified the following three material weaknesses in our internal control over financial reporting: (1) a lack of accounting staff and resources with appropriate knowledge of U.S. GAAP and SEC reporting and compliance requirements; (2) our lack of internal audit function to establish a formal risk assessment process and internal control framework; and (3) our lack of segregation of duties for certain key functions due to limited staff and resources.

As defined under standards established by PCAOB, a material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

As a result, we have already taken some steps and have continued to implement measures to remediate the material weaknesses identified, including but not limited to (i) continuing to recruit experienced personnel with relevant past experience working on U.S. GAAP and SEC reporting, (ii) improving the monitoring of and oversight controls for non-recurring transactions to ensure the accuracy and completeness of financial reporting and (iii) engaging external experts to assist with should there be non-recurring and complex transactions and continuing to implement measures to remediate our internal control deficiencies.

We are fully committed to continue to implement measures to remediate our material weaknesses, significant deficiencies and other control deficiencies in our internal control over financial reporting. However, the implementation of these measures may not fully address the material weaknesses in our internal control over financial reporting. We are not able to estimate with reasonable certainty the costs that we will need to incur to implement these and other measures designed to improve our internal control over financial reporting.

The process of designing and implementing an effective financial reporting system is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a financial reporting system that is adequate to satisfy our reporting obligations. See "Item 3. Key Information—D. Risk Factors—General Company Related Risks —We have identified material weaknesses in our internal control over financial reporting. If we fail to develop and maintain an effective system of internal control over financial reporting, we may be unable to accurately report our financial results or prevent fraud."

**Attestation Report of the Registered Public Accounting Firm**

Since we qualified as an "emerging growth company" as defined under the JOBS Act as of June 30, 2025, we are exempt from the requirement to comply with the auditor attestation requirements that our independent registered public accounting firm attest to and report on the effectiveness of our internal control structure and procedures for financial reporting. This Annual Report on Form 20-F does not include an attestation report of our independent registered public accounting firm due to a transition period established by rules of the SEC for emerging growth companies.

**Changes in Internal Control over Financial Reporting**

Other than those disclosed above, there were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the period covered by this Annual Report on Form 20-F that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**Item 16A. AUDIT COMMITTEE FINANCIAL EXPERT**

Our board of directors has determined that Dr. Wing Yan (William) Lo, an independent director and the chairman of our Audit Committee, qualifies as an "audit committee financial expert" within the meaning of the SEC rules and possesses financial sophistication within the meaning of the Nasdaq Stock Market listing rules. Dr. Wing Yan (William) Lo satisfies the independence requirements of Rule 5605(c)(2) of the Nasdaq Stock Market listing rules and meets the independence standards under Rule 10A-3 under the Exchange Act.

**Item 16B. CODE OF ETHICS**

Our board of directors has adopted a code of business conduct and ethics that applies to our directors, principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, and employees. A copy of our code of business conduct and ethics is available on our website at https://www.regencellbioscience.com.

**Item 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES**

The following table represents the approximate aggregate fees for services rendered by Marcum Asia, our independent registered public accounting firm, for the periods indicated:

---

| | | |
|:---|:---|:---|
|  | **For the Years Ended**<br> **June 30,** | **For the Years Ended**<br> **June 30,** |
|  | **2025** | **2024** |
| Audit Fees | $150000 | $150000 |
| Audit Related Fees | - | - |
| &nbsp;&nbsp;&nbsp;**Total Fees** | $150000 | $150000 |

---

"Audit fees" are the aggregate fees billed for assurance and related services that are reasonably related to the performance of the audit of our consolidated financial statements. These fees primarily include audit fee and interim review fee.

The policy of our audit committee is to pre-approve all audit and non-audit services provided by our independent auditor including audit services, audit-related services, tax services and other services.

Our Audit Committee evaluated and approved in advance the scope and cost of the engagement of an auditor before the auditor rendered its audit and non-audit services.

**Item 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES**

Not applicable.

**Item 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS**

Not applicable.

**Item 16F. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT**

Not applicable.

**Item 16G. CORPORATE GOVERNANCE**

As a Cayman Islands company listed on Nasdaq Capital Market, we are subject to the Nasdaq Stock Market corporate governance listing standards. However, the Nasdaq Stock Market listing rules permit a foreign private issuer like us to follow the corporate governance practices of its home country. Other than as described in this section, our corporate governance practices do not differ from those followed by domestic companies listed on the Nasdaq Capital Market. Nasdaq Stock Market listing rule 5635 generally provides that shareholder approval is required for U.S. domestic companies listed on the Nasdaq Capital Market prior to issuance (or potential issuance) of securities (i) equaling 20% or more of the company's common stock or voting power for less than the greater of market or book value (ii) resulting in a change of control of the company; and (iii) which is being issued pursuant to a share option or purchase plan to be established or materially amended or other equity compensation arrangement made or materially amended. Notwithstanding this general requirement, Nasdaq Stock Market listing rule 5615(a)(3)(A) permits foreign private issuers to follow their home country practice rather than these shareholder approval requirements. The Cayman Islands do not require shareholder approval prior to any of the foregoing types of issuances. Our company, therefore, is not required to obtain such shareholder approval prior to entering into a transaction with the potential to issue securities as described above. Our board of directors has elected to follow the Company's home country rules as to such issuances and will not be required to seek shareholder approval prior to entering into such a transaction.

**Item 16H. MINE SAFETY DISCLOSURE**

Not applicable.

**Item 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS**

Not applicable.

**ITEM 16J. INSIDER TRADING POLICIES**

Regencell Bioscience Holdings Limited's board of directors has adopted insider trading policies and procedures governing the purchase, sale, and other dispositions of Regencell Bioscience Holdings Limited's securities by directors, senior management, and employees that are reasonably designed to promote compliance with applicable insider trading laws, rules and regulations, and any listing standards applicable to us. The policy is filed as Exhibit 11 hereto.

**ITEM 16K. CYBERSECURITY**

**Risk Management and Strategy**

 ****

We recognize the importance of safeguarding the security of our computer systems, software, networks, and other technology assets. We have implemented cybersecurity measures and protocols for assessing, identifying, and managing material risks from cybersecurity threats, which are integrated into our overall risk management framework. We aim to ensure a comprehensive and proactive approach to safeguarding our assets and operations.

As of the date of this annual report, we have not experienced any material cybersecurity incidents or identified any material cybersecurity threats that have affected or are reasonably likely to materially affect us, our business strategy, results of operations or financial condition.

**Governance**

Our board of directors is responsible for overseeing risks related to cybersecurity. Our board of directors shall (i) maintain oversight of the disclosure related to cybersecurity matters in current reports or periodic reports of our company, (ii) review updates to the status of any material cybersecurity incidents or material risks from cybersecurity threats to our company, and the disclosure issues, if any, presented by our management on a quarterly basis, and (iii) review disclosure concerning cybersecurity matters in our annual report on Form 20-F presented by our management.

At the management level, our CBO and COO and information technology personnel are responsible for assessing, identifying and managing cybersecurity risks and monitoring the prevention, detection, mitigation, and remediation of cybersecurity incidents. Our CBO and COO report to our board of directors (i) timely updates to the status of any material cybersecurity incidents or material risks from cybersecurity threats to our company, and the disclosure issues, if any, and (ii) in connection with disclosure concerning cybersecurity matters in our annual report on Form 20-F.

If a cybersecurity incident occurs, our information technology personnel will promptly organize an internal assessment. If it is further determined that the incident could potentially be a material cybersecurity event, the cybersecurity-related departments will promptly report the incident and assessment results to our CBO and COO, and, to the extent appropriate, seek advice from external experts and legal counsels. If it is determined that the incident could potentially be a material cybersecurity event, our CBO and COO will decide on relevant response measures and management shall promptly prepare disclosure material on the cybersecurity incident for review and approval by our board of directors before it is disseminated to the public.

**Part III**

**Item 17. FINANCIAL STATEMENTS**

We have elected to provide financial statements pursuant to Item 18.

**Item 18. FINANCIAL STATEMENTS**

The consolidated financial statements of Regencell Bioscience Holdings Limited, and its subsidiaries are included at the end of this Annual Report.

**Item 19. EXHIBITS**

**EXHIBIT INDEX**

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 1.1\* | [Amended and Restated Memorandum and Articles of Association, adopted by special resolution passed on May 31, 2021, as currently in effect](ea026082001ex1-1_regencell.htm) |
| 2.1 | [Specimen Certificate for Ordinary Shares (incorporated by reference to Exhibit 4.1 from Amendment No. 2 to our registration statement on Form F-1 (File No. 333-254571) filed with the SEC on June 11, 2021)](http://www.sec.gov/Archives/edgar/data/1829667/000121390021032158/ea142369ex4-1_regencell.htm) |
| 2.2\* | [Description of Securities](ea026082001ex2-2_regencell.htm) |
| 4.1 | [Deed of Rights Transfer, Strategic Partnership and Undertaking between Sik-Kee Au and Regencell Bioscience Limited dated January 1, 2018 (incorporated by reference to Exhibit 10.1 from our registration statement on Form F-1 (File No. 333-254571) filed with the SEC on March 22, 2021)](http://www.sec.gov/Archives/edgar/data/1829667/000121390021016917/ea136947ex10-1_regencell.htm) |
| 4.2 | [Amended and Restated Employment Agreement by and between CEO Yat-Gai Au and Regencell Bioscience Holdings Limited dated February 2, 2021 (incorporated by reference to Exhibit 10.2 from our registration statement on Form F-1 (File No. 333-254571) filed with the SEC on March 22, 2021)](http://www.sec.gov/Archives/edgar/data/1829667/000121390021016917/ea136947ex10-2_regencell.htm) |
| 4.3 | [Supplemental Agreement of Deed of Rights Transfer, Strategic Partnership and Undertaking between Sik-Kee Au and Regencell Bioscience Limited dated November 10, 2020 (incorporated by reference to Exhibit 10.3 from our registration statement on Form F-1 (File No. 333-254571) filed with the SEC on March 22, 2021)](http://www.sec.gov/Archives/edgar/data/1829667/000121390021016917/ea136947ex10-3_regencell.htm) |
| 4.4 | [Employment Agreement between Mr. James Wai Hong Chung and Regencell Bioscience Limited dated July 6, 2019 (incorporated by reference to Exhibit 10.6 from our registration statement on Form F-1 (File No. 333-254571) filed with the SEC on March 22, 2021)](http://www.sec.gov/Archives/edgar/data/1829667/000121390021016917/ea136947ex10-6_regencell.htm) |
| 4.5 | [Employment Agreement between Yat-Pui Au and Regencell Bioscience Limited dated September 7, 2021 (incorporated by reference to Exhibit 4.6 from our annual report on Form 20-F for the fiscal year ended June 30, 2023 (File No. 001-40617) filed with the SEC on October 27, 2023)](http://www.sec.gov/Archives/edgar/data/1829667/000101376223007289/f20f2023ex4-6_regencellbio.htm) |
| 4.6 | [Form of Director Offer Letter (incorporated by reference to Exhibit 10.11 from Amendment No. 2 to our registration statement on Form F-1 (File No. 333-254571) filed with the SEC on June 11, 2021)](http://www.sec.gov/Archives/edgar/data/1829667/000121390021032158/ea142369ex10-11_regencell.htm) |
| 4.7 | [Form of Option Agreement (incorporated by reference to Exhibit 10.12 from Amendment No. 2 to our registration statement on Form F-1 (File No. 333-254571) filed with the SEC on June 11, 2021)](http://www.sec.gov/Archives/edgar/data/1829667/000121390021032158/ea142369ex10-12_regencell.htm) |

---

---

| | |
|:---|:---|
| 4.8 | [2021 Share Option Plan (incorporated by reference to Exhibit 10.13 from Amendment No. 3 to our registration statement on Form F-1 (File No. 333-254571) filed with the SEC on June 23, 2021)](http://www.sec.gov/Archives/edgar/data/1829667/000121390021033616/ea143071ex10-13_regencell.htm) |
| 8.1\* | [List of Subsidiaries and Affiliated Entities](ea026082001ex8-1_regencell.htm) |
| 11.1 | [Insider Trading Policy (incorporated by reference to Exhibit 11.1 from our annual report on Form 20-F for the fiscal year ended June 30, 2024 (File No. 001-40617) filed with the SEC on October 25, 2024)](https://www.sec.gov/Archives/edgar/data/1829667/000121390024090791/ea021841001ex11-1_regencell.htm) |
| 12.1\* | [Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ea026082001ex12-1_regencell.htm) |
| 12.2\* | [Certification by Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ea026082001ex12-2_regencell.htm) |
| 13.1\*\* | [Certification by the Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ea026082001ex13-1_regencell.htm) |
| 13.2\*\* | [Certification by the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ea026082001ex13-2_regencell.htm) |
| 97 | [Clawback Policy (incorporated by reference to Exhibit 97 from our annual report on Form 20-F for the fiscal year ended June 30, 2024 (File No. 001-40617) filed with the SEC on October 25, 2024)](https://www.sec.gov/Archives/edgar/data/1829667/000121390024090791/ea021841001ex97_regencell.htm) |
| 101.INS\* | Inline XBRL Instance Document- the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
| 101.SCH\* | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104\* | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |

---

\* Filed herewith.

\*\* Furnished herewith.

**SIGNATURES**

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Annual Report on its behalf.

---

| | |
|:---|:---|
| **Regencell Bioscience Holdings Limited** | **Regencell Bioscience Holdings Limited** |
| By: | /s/ Yat-Gai Au |
| Name: | Yat-Gai Au |
| Title: | Chief Executive Officer<br> (Principal Executive Officer) |
| Dated: | October 31, 2025 |

---

**REGENCELL BIOSCIENCE HOLDINGS LIMITED**

**Index to Consolidated Financial Statements**

---

| | |
|:---|:---|
|  | **Page** |
| [Report of Independent Registered Public Accounting Firm (PCAOB ID: 5395)](#b_001) | F-2 |
| Financial Statements: |  |
| &nbsp;&nbsp;&nbsp;[Consolidated Balance Sheets at June 30, 2025 and 2024](#b_002) | F-3 |
| &nbsp;&nbsp;&nbsp;[Consolidated Statements of Operations and Comprehensive Loss for the Years Ended June 30, 2025, 2024 and 2023](#b_003) | F-4 |
| &nbsp;&nbsp;&nbsp;[Consolidated Statements of Changes in Shareholders' Equity for the Years Ended June 30, 2025, 2024 and 2023](#b_004) | F-5 |
| &nbsp;&nbsp;&nbsp;[Consolidated Statements of Cash Flows for the Years Ended June 30, 2025, 2024 and 2023](#b_005) | F-6 |
| &nbsp;&nbsp;&nbsp;[Notes to Consolidated Financial Statements](#b_006) | F-7 to F-21 |

---

**Report of Independent Registered Public Accounting Firm**

To the Shareholders and Board of Directors of

**Regencell Bioscience Holdings Limited**

**Opinion on the Financial Statements**

We have audited the accompanying consolidated balance sheets of Regencell Bioscience Holdings Limited (the "Company") as of June 30, 2025 and 2024, the related consolidated statements of operations and comprehensive loss, changes in shareholders' equity and cash flows for each of the years in the three-year period ended June 30, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2025 and 2024, and the results of its operations and its cash flows for each of the years in the three-year period ended June 30, 2025, in conformity with accounting principles generally accepted in the United States of America.

**Explanatory Paragraph - Going Concern**

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As more fully described in Note 2, the Company has significant accumulated deficit, has incurred significant recurring losses and operating cash outflows and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in regard to these matters were also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

**Basis for Opinion**

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

/s/ Marcum Asia CPAs llp

Marcum Asia CPAs llp

We have served as the Company's auditor since 2020. (such date takes into account the acquisition of certain assets of Freidman LLP by Marcum Asia CPAs LLP effective September 1, 2022)

New York, New York

**October 31, 2025**

NEW YORK OFFICE • 7 Penn Plaza • Suite 830 • New York, New York • 10001

Phone 646.442.4845 • Fax 646.349.5200 • www.marcumasia.com

**REGENCELL BIOSCIENCE HOLDINGS LIMITED AND SUBSIDIARIES**

**CONSOLIDATED Balance sheets**

---

| | | |
|:---|:---|:---|
|  | **As of June 30,** | **As of June 30,** |
|  | **2025** | **2024** |
| **ASSETS** |  |  |
| **CURRENT ASSETS** |  |  |
| &nbsp;&nbsp;&nbsp;Cash | $2419115 | $2961235 |
| &nbsp;&nbsp;&nbsp;Short-term investment | 2477900 | 5000000 |
| &nbsp;&nbsp;&nbsp;Prepayments and other receivables | 5798 | 152778 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current assets** | **4902813** | **8114013** |
| **OTHER ASSETS** |  |  |
| &nbsp;&nbsp;&nbsp;Property and equipment, net | 215434 | 141734 |
| &nbsp;&nbsp;&nbsp;Long-term deposits | 92950 | 97684 |
| &nbsp;&nbsp;&nbsp;Right-of-use assets, net | 544385 | 84780 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total other assets** | **852769** | **324198** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total assets** | $**5755582** | $**8438211** |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| **CURRENT LIABILITIES** |  |  |
| &nbsp;&nbsp;&nbsp;Accrued expenses | 348354 | 125328 |
| &nbsp;&nbsp;&nbsp;Other payables – related parties | 2539 | 8443 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities – current | 312780 | 59807 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total current liabilities** | **663673** | **193578** |
| **NON-CURRENT LIABILITIES** |  |  |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities – non – current | 231635 | 25934 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total liabilities** | **895308** | **219512** |
| **COMMITMENTS AND CONTINGENCIES** |  |  |
| **SHAREHOLDERS' EQUITY** |  |  |
| &nbsp;&nbsp;&nbsp;Ordinary shares, $0.00001 par value, 100,000,000,000 shares authorized, and 494,488,908 shares issued and outstanding as of June 30, 2025 and 2024, respectively\* | 4945 | 130 |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital | 30121231 | 29881238 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (25201116) | (21616903) |
| &nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (64786) | (45766) |
| &nbsp;&nbsp;&nbsp;Total equity attributed to shareholders of the Company | 4860274 | 8218699 |
| &nbsp;&nbsp;&nbsp;**Non-controlling interest** | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 4860274 | 8218699 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $5755582 | $8438211 |

---

\* Giving retroactive effect to the 38-for-1 share split (as defined below) effected on June 13, 2025.

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

**REGENCELL BIOSCIENCE HOLDINGS LIMITED AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS**

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Year Ended June 30,** | **For the Year Ended June 30,** | **For the Year Ended June 30,** |
|  | **2025** | **2024** | **2023** |
| **OPERATING EXPENSES:** |  |  |  |
| &nbsp;&nbsp;&nbsp;Selling and marketing | $8014 | $125427 | $262664 |
| &nbsp;&nbsp;&nbsp;General and administrative (including share-based compensation of $0.20 million, $0.48 million and $0.89 million for the years ended June 30, 2025, 2024 and 2023 respectively) | 2813682 | 3545066 | 4429379 |
| &nbsp;&nbsp;&nbsp;Research and development (including share-based compensation of $0.04 million, reversal of share-based compensation of $0.03 million and share-based compensation of $0.03 million for the years ended June 30, 2025, 2024 and 2023 respectively) | 948289 | 1066233 | 1581628 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 3769985 | 4736726 | 6273671 |
| **LOSS FROM OPERATIONS** | (3769985) | (4736726) | (6273671) |
| **OTHER INCOME, NET** | 185772 | 373505 | 211342 |
| **LOSS BEFORE INCOME TAXES** | (3584213) | (4363221) | (6062329) |
| **PROVISION FOR INCOME TAXES** | - | - | - |
| **NET LOSS** | $(3584213) | $(4363221) | $(6062329) |
| **NET LOSS ATTRIBUTABLE TO:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Shareholders of the Company | $(3584213) | $(4301837) | $(5871130) |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interest | - | (61384) | (191199) |
|  | $(3584213) | $(4363221) | $(6062329) |
| **OTHER COMPREHENSIVE LOSS** |  |  |  |
| &nbsp;&nbsp;&nbsp;Foreign currency translation adjustment | (19020) | 40892 | (86658) |
| **COMPREHENSIVE LOSS** | $(3603233) | $(4322329) | $(6148987) |
| **NET COMPREHENSIVE LOSS ATTRIBUTABLE TO:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Shareholders of the Company | $(3603233) | $(4260945) | $(5957788) |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interest | - | (61384) | (191199) |
|  | $(3603233) | $(4322329) | $(6148987) |
| **WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES** |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted\* | 494488908 | 494488908 | 494488908 |
| **LOSS PER SHARE** |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted (cents)\* | (0.72) | (0.87) | (1.19) |

---

\* Giving retroactive effect to the 38-for-1 share split effected on June 13, 2025.

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

**REGENCELL BIOSCIENCE HOLDINGS LIMITED AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY** 

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Ordinary Shares\*** | **Ordinary Shares\*** | | | | | |
|  | **Shares** | **Par value** | **Additional<br> paid-in**<br>**Capital** | **Accumulated<br> Other<br> comprehensive**<br>**loss** | **Accumulated**<br>**deficit** | **Non-<br> controlling**<br>**interest** |<br>**Total** |
| **BALANCE, June 30, 2022** | 494488908 | $4945 | $28504489 | $- | $(11443936) | $15388 | $17080886 |
| &nbsp;&nbsp;&nbsp;Share-based compensations |  | - | 922623 | - | - | - | 922623 |
| &nbsp;&nbsp;&nbsp;Capital contribution from non-controlling interest of a subsidiary |  | - | - | - | - | 134913 | 134913 |
| &nbsp;&nbsp;&nbsp;Net loss |  | - | - | - | (5871130) | (191199) | (6062329) |
| &nbsp;&nbsp;&nbsp;Foreign currency translation adjustment | - | - | - | (86658) | - | - | (86658) |
| **BALANCE, June 30, 2023** | 494488908 | $4945 | $29427112 | $(86658) | $(17315066) | $(40898) | $11989435 |
| &nbsp;&nbsp;&nbsp;Share-based compensations |  | - | 449311 | - | - | - | 449311 |
| &nbsp;&nbsp;&nbsp;Capital contribution from non-controlling interest of a subsidiary |  | - | - | - |  | 102282 | 102282 |
| &nbsp;&nbsp;&nbsp;Net loss |  | - | - | - | (4301837) | (61384) | (4363221) |
| &nbsp;&nbsp;&nbsp;Foreign currency translation adjustment | - | - | - | 40892 | - | - | 40892 |
| **BALANCE, June 30, 2024** | 494488908 | $4945 | $29876423 | $(45766) | $(21616903) | $- | $8218699 |
| &nbsp;&nbsp;&nbsp;Share-based compensations |  | - | 244808 | - | - | - | 244808 |
| &nbsp;&nbsp;&nbsp;Net loss |  | - | - | - | (3584213) | - | (3584213) |
| &nbsp;&nbsp;&nbsp;Foreign currency translation adjustment | - | - | - | (19020) | - | - | (19020) |
| **BALANCE, June 30, 2025** | 494488908 | $4945 | $30121231 | $(64786) | $(25201116) | $- | $4860274 |

---

\* Giving retroactive effect to the 38-for-1 share split effected on June 13, 2025.

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

**REGENCELL BIOSCIENCE HOLDINGS LIMITED AND SUBSIDIARIES**

**CONSOLIDATED STATEMENTS OF CASH FLOW**

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Year Ended June 30,** | **For the Year Ended June 30,** | **For the Year Ended June 30,** |
|  | **2025** | **2024** | **2023** |
| **CASH FLOWS FROM OPERATING ACTIVITIES:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | $(3584213) | $(4363221) | $(6062329) |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash used in operating activities: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 77692 | 305780 | 293135 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of right-of-use asset | 315051 | 439808 | 476552 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation | 244808 | 449311 | 922623 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest income | (185772) | (248000) | (85400) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on disposal of property and equipment | - | - | 1415 |
| &nbsp;&nbsp;&nbsp;Change in operating assets and liabilities |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepayments and other receivables | 146980 | (96230) | (28950) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term deposits | 4734 | 10815 | 5803 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses | 223026 | (32753) | 6954 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities | (349978) | (465070) | (487672) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other payables – related parties | (5904) | (2127) | (5080) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in operating activities | (3113576) | (4001687) | (4962949) |
| **CASH FLOWS FROM INVESTING ACTIVITIES:** |  |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of property and equipment | (152689) | (5376) | (27392) |
| &nbsp;&nbsp;&nbsp;Proceed from disposal of property and equipment | - | - | 970 |
| &nbsp;&nbsp;&nbsp;Proceeds from maturity of short-term investments | 35316805 | 10248000 | 10085400 |
| &nbsp;&nbsp;&nbsp;Placements of short-term investments | (32477900) | (5000000) | (10000000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by investing activities | 2686216 | 5242624 | 58978 |
| **CASH FLOWS FROM FINANCING ACTIVITY:** |  |  |  |
| &nbsp;&nbsp;&nbsp;Capital contribution from non-controlling interest of a subsidiary, net | - | 102282 | 134913 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by financing activity | - | 102282 | 134913 |
| **EFFECT OF EXCHANGE RATE ON CASH** | (114760) | 53221 | (83145) |
| **NET CHANGE IN CASH** | (542120) | 1396440 | (4852203) |
| **CASH, beginning of year** | 2961235 | 1564795 | 6416998 |
| **CASH, end of year** | $2419115 | $2961235 | $1564795 |
| **SUPPLEMENTAL CASH FLOW INFORMATION:** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash paid for income tax | $- | $- | $- |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash paid for interest | $- | $- | $- |
| **Supplemental disclosure of non-cash financing activities:** |  |  |  |
| Right-of-use assets obtained in exchange of lease liabilities | 778625 | 71122 | 189767 |
| Early termination of right-of-use assets in exchange of lease liabilities | - | - | (40353) |

---

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

**Note 1 – Nature of business and organization**

Regencell Bioscience Holdings Limited ("Regencell" or the "Company" or "we") is a holding company incorporated as an exempted company on October 30, 2014, under the laws of the Cayman Islands and holding all of the outstanding share capital of Regencell Limited, established under the laws of Hong Kong on November 20, 2014, and Regencell Bioscience Limited, established under the laws of Hong Kong on May 12, 2015.

The Company, through its controlling interests in the wholly owned subsidiaries, operates an early-stage bioscience company that focuses on research, development and commercialization of Traditional Chinese Medicine ("TCM") for the global treatment of neurocognitive disorder and degeneration, specifically for Attention Deficit Hyperactivity Disorder ("ADHD") and Autism Spectrum Disorder ("ASD"). The Company is in the research and development stage and has not yet generated any revenue since inception.

In January 2018, the Company entered into Strategic Partnership Agreement with Mr. Sik-Kee Au (the "TCM Practitioner"), the father of Mr. Yat-Gai Au, CEO and director of the Company. Pursuant to the Strategic Partnership Agreement, the Company has exclusive rights including the intellectual property rights and ownership of all his TCM formula. Any inventions, TCM formula, utilities, models' improvements, research, discoveries, designs, processes, methods of manufacture, and products conceived or made by the TCM Practitioner in relation to TCM shall be the sole and exclusive property of the Company.

The Strategic Partnership Agreement does not have a termination date and will remain effective indefinitely under the Hong Kong law. The Strategic Partnership Agreement can be amended or terminated by the mutual written agreement of the parties without breach. Pursuant to the Strategic Partnership Agreement, in exchange for the rights, the Company is required to donate three percent (3.0%) of net revenue that the Company generates in association with the use and/or commercialization of the TCM formula to any of charitable institutions and/or trusts of a public character anywhere in the world at the sole and absolute choice of the TCM Practitioner and in such proportion at the sole and absolute discretion of the TCM practitioner on a yearly basis. The Company also undertakes to pay for all reasonable costs and expenses incurred by the TCM Practitioner in relation to the research and development of the TCM formula for ADHD and ASD. All research and development costs and expenses incurred by the TCM Practitioner are charged to operations as incurred.

On July 20, 2021, the Company consummated its Initial Public Offering ("IPO") of 87,400,000 (after giving retroactive effect to the 38-for-1 forward stock split) ordinary shares, $0.00001 par value ("Ordinary Shares") at a price of $0.25 (after giving retroactive effect to the 38-for-1 forward stock split) per share. The gross proceeds from IPO were approximately $21.85 million with net proceeds of approximately $19.82 million. As a result of the IPO, the Ordinary Shares now trade on the Nasdaq Capital Market under the symbol "RGC". Additional net proceeds of approximately $2.85 million were received on August 20, 2021 from the issuance of the overallotment of 12,350,000 (after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares. 12,999,990 (after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares were issued to Mr. Yat-Gai Au upon the automatic conversion of $3,250,000 principal amount of the shareholder loan under the conversion note that was issued to Mr. Yat-Gai Au at a price of $0.25 (after giving retroactive effect to the 38-for-1 forward stock split) per share.

On September 2, 2021, the Company's wholly-owned subsidiary, Regencell Bioscience Limited entered into a joint venture agreement with Honor Epic Enterprises Limited to form a joint venture, Regencell Bioscience Asia Limited, under the laws of Hong Kong. The Company held 60% equity interest in Regencell Bioscience Asia Limited. The joint venture ceased business on December 31, 2023 and deregistered on November 1, 2024. The disposition of the joint venture did not have a material impact on the ongoing results of operations of financial results.

The Company has funded its operations primarily from the net proceeds from the completion of its IPO. The accompanying consolidated financial statements reflect the activities of the Company and each of the following entities:

---

| | | | |
|:---|:---|:---|:---|
| **Name of Entity** | **Principal Activities** | **Place and Date of<br> Incorporation** | **Ownership** |
| Regencell Bioscience Limited | Research and Development Day-to-day operations | Hong Kong, incorporated on May 12, 2015 | 100% owned by Regencell Bioscience Holdings Limited |
| Regencell Limited | Production and testing laboratory<br> Research and Development | Hong Kong, incorporated on November 20, 2014 | 100% owned by Regencell Bioscience Holdings Limited |
| Regencell Bioscience Asia Limited | Research and Development | Hong Kong, incorporated on September 17, 2021 (Ceased business on December 31, 2023 and deregistered on November 1, 2024) | 60% owned by Regencell Bioscience Limited |
| Regencell Bioscience North America Limited | Research and Development | BVI, incorporated on April 25, 2022 | 100% owned by Regencell Bioscience Holdings Limited |

---

**Note 2 – Liquidity and Going Concern**

In accordance with Accounting Standards Update ("ASU") 2014-15, Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern (Subtopic 205-40), the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern within one year after the date that the consolidated financial statements are issued.

For the year ended June 30, 2025, the Company had net loss amounted to $3.58 million (2024: $4.36 million) and net cash used in operating activities amounted to $3.11 million (2024: $4.00 million). As of June 30, 2025, the Company's accumulated deficit amounted to $25.20 million. The Company's ability to continue as a going concern is highly contingent on the ability to raise additional capital for ongoing research and development as the Company expects to continue to incur losses for the foreseeable future.

Based on the Company's recurring losses and negative cash flows from operations since inception, expectation of continuing operating losses and negative cash flows from operations for the foreseeable future, the contractual costs expected to be incurred in future periods and the need to raise additional capital to finance its future operations, the Company's management concluded that there is substantial doubt about the Company's ability to continue as a going concern within one year after the issuance date of the consolidated financial statements.

The Company is evaluating several strategies and actively pursuing actions aimed at enhancing its liquidity position. These actions include pursuing additional cost savings initiatives and seeking additional financing in both public and private markets. There can be no assurances, however, that the Company's operating plan will be achieved or that additional funding will be available on terms acceptable to the Company, or at all.

The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Accordingly, the consolidated financial statements have been prepared on a basis that assumes the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

**Note 3 – Summary of significant accounting policies**

Basis of presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") pursuant to the rules and regulations of the U.S. Securities and Exchange Commission ("SEC").

Principles of consolidation

The consolidated financial statements include the financial statements of the Company and its subsidiaries. All intercompany transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.

Subsidiaries are those entities in which the Company, directly or indirectly, controls more than one half of the voting power; or has the power to govern the financial and operating policies, to appoint or remove the majority of the members of the board of directors, or to cast a majority of votes at the meeting of directors.

Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated balance sheets, consolidated statements of operations and comprehensive loss and consolidated statement of changes in shareholders' equity, respectively.

Use of estimates and assumptions

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant accounting estimates reflected in the Company's consolidated financial statements required to be made by management include, but not limited to, the useful lives of property and equipment, impairment of long-lived assets, valuation of share options, share-based compensation, allowance for deferred tax assets. Actual results could differ from these estimates.

Risks and Uncertainties

The Company operates in an industry that is subject to intense competition, government regulations and rapid technological changes. Operations are subject to significant risk and uncertainties including financial, operational, technological, regulatory, and other risks, including the potential risk of business failure.

Segment

The ASU 2023-07: Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures provides improvements to reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. In addition, the amendments enhance interim disclosure requirements, clarify circumstances in which an entity can disclose multiple measures of segment profit or loss, provide new segment disclosure requirements for entities with a single reportable segment and contain other disclosure requirements. The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods in fiscal years beginning after December 15, 2024. The ASU should be adopted retrospectively to all periods presented in the financial statements unless it is impracticable to do so. The Company adopted ASU 2023-09 for the year beginning on July 1, 2024. The adoption of ASU 2023-07 does not have a material impact on the Company's consolidated balance sheets, statements of operations and comprehensive loss, cash flows or disclosures. Refer to Note 10, Segment Reporting for the inclusion of the new required disclosures.

Foreign currency translation and transaction

The reporting currency of the Company is the United States dollar ("$"). The Company conducts its businesses in Hong Kong in the local currency, Hong Kong Dollar ("HK$"), as its functional currency. The consolidated balance sheet accounts, statement of operations accounts and equity accounts are all translated at the exchange rate as quoted by the Hong Kong Monetary Authority ("HKMA"). The Company considers the foreign exchange risk in relation to transactions denominated in HK$ with respect to $ is not significant as HK$ is pegged to $.

Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency at the rates of exchange existing at the balance sheet date. Transactions in currencies other than the functional currency during the year are converted into the functional currency at the applicable rates of exchange prevailing at the transaction date. Transaction gains and losses are recognized in "other income, net." Assets and liabilities denominated in foreign currencies are translated at the exchange rates at the balance sheet date. Equity accounts are translated at historical exchange rates and revenues, expenses, gains and losses are translated using the average rate for the year. Translation adjustments are reported as cumulative translation adjustments and are shown as a separate component of other comprehensive loss in the consolidated statements of changes in shareholders' equity and comprehensive loss.

Cash

Cash represents demand deposits placed with banks or other financial institutions, which are unrestricted as to withdrawal or use, and which have original maturities of three months or less and are readily convertible to known amounts of cash. All of the cash balances as at June 30, 2025 and 2024, were maintained at financial institutions in Hong Kong, and were insured by the Hong Kong Deposit Protection Board up to a limit of HK$800,000 (approximately $102,000) since October 1, 2024 (2024: HK$500,000) per depositor per scheme member in an event of bank failure.

Short term investment

Short term investment represents certificates of bank deposits or time deposits that have a maturity, at the date of purchase, of less than one year.

Property and equipment, net

Property and equipment are stated at cost less accumulated depreciation and impairment loss, if any. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The estimated useful lives are as follows:

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| | |
|:---|:---|
|  | **Useful Life** |
| Leasehold improvement | Shorter of the remaining lease terms or <br> estimated useful lives |
| Office furniture, equipment and others | 3 – 5 years |
| Motor vehicles | 5 years |

---

The cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts and any gain or loss is included in the consolidated statements of operations and comprehensive loss. Expenditures for maintenance and repairs are charged to earnings as incurred, while additions, renewals and betterments, which are expected to extend the useful life of assets, are capitalized. The Company also re-evaluates the periods of depreciation to determine whether subsequent events and circumstances warrant revised estimates of useful lives.

Prepayment

Prepayments primarily consist of prepayments for corporate apartments' rental. Prepayments are classified as current based on the terms of the respective agreements. This prepayment is unsecured and is reviewed periodically to determine whether their carrying value has become impaired.

Long-term deposits

Long-term deposits present the deposits paid to the landlords as required on the signing of the various lease agreements and thereafter, to be held by the landlords as security for the performance of the Company's obligations under the lease agreements. The deposits are classified as either current or non-current based on the terms of the respective agreements. The deposit is unsecured and is reviewed periodically to determine whether its carrying value has become impaired.

Impairment for long-lived assets

Long-lived assets, including property and equipment with finite lives are reviewed for impairment whenever events or changes in circumstances (such as a significant adverse change to market conditions that will impact the future use of the assets) indicate that the carrying value of an asset may not be recoverable. The Company assesses the recoverability of the assets based on the undiscounted future cash flows the assets are expected to generate and recognize an impairment loss when estimated undiscounted future cash flows expected to result from the use of the asset plus net proceeds expected from disposition of the asset, if any, are less than the carrying value of the asset. If an impairment is identified, the Company would reduce the carrying amount of the asset to its estimated fair value based on a discounted cash flows approach or, when available and appropriate, to comparable market values. For the years ended June 30, 2025, 2024 and 2023, no impairment loss on long-lived assets was recognized.

Fair value measurement

ASC 825-10 requires certain disclosures regarding the fair value of financial instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:

● Level 1 — inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

● Level 2 — inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted market prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data.

● Level 3 — inputs to the valuation methodology are unobservable.

Unless otherwise disclosed, the fair value of the Company's financial instruments including cash, short-term investment, accrued expenses and other payables – related parties approximate their recorded values due to their short-term maturities. The fair value of the long-term deposits approximates their carrying amounts because the deposit was paid in cash.

Selling and Marketing Expenses

Sales and marketing expenses were mainly for marketing initiatives and sponsorship with Non-Governmental Organizations ("NGOs") and institutions that serves families with ADHD and ASD children, who voluntary sign up as qualified patients to be enrolled in our efficacy trial in the future. The Group expenses all advertising costs as incurred and classifies these costs under sales and marketing expenses. For the years ended June 30, 2025, 2024 and 2023, the advertising expenses were approximately nil, $1 thousand and $0.03 million, respectively.

Research and development Expenses

Research and development costs are charged to operations as incurred. The Company accounts for non-refundable advance payments for goods and services that will be used in future research and development activities as expenses when the goods have been received or when the service has been performed rather than when the payment is made. Research and development expenses consist of costs incurred by the Company for the discovery and development of the Company's product candidates. Research and development costs include, but not limited to, payroll and personnel expenses including share-based compensation, research studies supplies, fees for research studies services, consulting costs, and allocated overhead, including rent, equipment, and utilities.

Employee benefit plan

Employees of the Company located in Hong Kong participate in a compulsory saving scheme (pension fund) for the retirement of residents in Hong Kong. Employees are required to contribute monthly to mandatory provident fund schemes provided by approved private organizations, according to their salaries and the period of employment. The Company is required to contribute to the plan based on certain percentages of the employees' salaries, up to a maximum amount specified by the local government. For the years ended June 30, 2025, 2024 and 2023, the contribution made was approximately $24 thousand, $26 thousand and $25 thousand, respectively.

Leases

The Company adopted the new lease accounting standard – ASC 842 on July 1, 2021. The Company determines if an arrangement is or contains a lease at inception. Operating leases with lease terms of more than 12 months are included in operating lease assets, accrued and other current liabilities, and long-term operating lease liabilities on its consolidated balance sheet. Operating lease assets represent its right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments over the lease term. Operating lease assets and liabilities are recognized based on the present value of the remaining lease payments discounted using their incremental borrowing rate. Lease expense is recognized on a straight-line basis over the lease term.

Related Parties

Parties, which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence, such as a family member or relative, shareholder, or a related corporation.

Government grants

Government grants include financial incentives in the form of cash subsidies that involve no conditions or continuing performance obligations of the Company. Government grants are recognized as other non-operating income upon receipt.

Share-based compensation

The Company accounts for share-based compensation in accordance with ASC 718, Compensation — Stock Compensation ("ASC 718"). The Company determines whether an award should be classified and accounted for as a liability award or an equity award. All of the Company's share-based awards were classified as equity awards and are recognized in the consolidated financial statements based on their grant date fair values.

The Company has elected to recognize share-based compensation using graded vesting method over the requisite service period, which is the vesting period. The Company accounts for forfeitures as they occur in accordance with ASU No. 2016-09, Compensation — Stock Compensation (Topic 718): Improvement to Employee Share-based Payment Accounting. The Company, with the assistance of an independent third-party valuation firm, determined the fair value of the share options granted to employees. The Black Scholes Model and/or the Binomial Model was applied in determining the estimated fair value of the options granted to employees and non-employees. During the years ended June 30, 2025, 2024 and 2023, 826,652 share options, 1,727,290 share options and 6,662,388 share options were forfeited respectively while 3,948,086 share options, nil and nil were expired during the year ended June 30, 2025, 2024 and 2023 respectively. These share options reflect the 38-for-1 forward stock split.

Income taxes

The Company accounts for current income taxes in accordance with the laws of the relevant tax authorities. Deferred income taxes are recognized when temporary differences exist between the tax bases of assets and liabilities and their reported amounts in the consolidated financial statements. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period including the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized.

An uncertain tax position is recognized as a benefit only if it is "more likely than not" that the tax position would be sustained in a tax examination. The amount recognized is the largest amount of tax benefit that is greater than 50% likely of being realized on examination. For tax positions not meeting the "more likely than not" test, no tax benefit is recorded. Penalties and interest incurred related to underpayment of income tax are classified as income tax expense in the period incurred. No significant penalties or interest relating to income taxes have been incurred during the years ended June 30, 2025, 2024 and 2023.

(Loss) earnings per share

The Company computes (loss) earnings per share ("EPS") in accordance with ASC 260, "Earnings per Share." ASC 260 requires companies to present basic and diluted EPS. Basic EPS is measured as net income (loss) divided by the weighted average ordinary share outstanding for the period. Diluted income per share is calculated by dividing net income attributable to the holders of ordinary shares as adjusted for the effect of dilutive ordinary share equivalents, if any, by the weighted average number of ordinary shares and dilutive ordinary share equivalents outstanding during the period. Potential Ordinary Shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. For the years ended June 30, 2025, 2024 and 2023, there were no dilutive shares.

Commitments and Contingencies

In the normal course of business, the Company is subject to contingencies, including legal proceedings and claims arising out of the business that relate to a wide range of matters, such as government investigations and tax matters. The Company recognizes a liability for such contingency if it determines it is probable that a loss has occurred and a reasonable estimate of the loss can be made. The Company may consider many factors in making these assessments including historical and the specific facts and circumstances of each matter.

Concentration of credit risk

Financial instruments that potentially subject the Company to concentration of credit risks consist primarily of cash, the balances of which are stated on the consolidated balance sheets which represent the Company's maximum exposure.

The Company places its cash in good credit quality financial institutions in Hong Kong. The Company deposits its cash in financial institutions that it believes have high credit quality and have not experienced any losses on such accounts and does not believe it is exposed to any unusual credit risk beyond the normal credit risk associated with commercial banking relationships.

Recently issued accounting pronouncements

In December 2023, the FASB issued ASU 2023-09 "Improvements to Income Tax Disclosures" ("ASU 2023-09"). ASU 2023-09 intends to improve the transparency of income tax disclosures. ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 and is to be adopted on a prospective basis with the option to apply retrospectively. The Company is currently evaluating the impact from the adoption of this ASU on its consolidated financial statements.

In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses ("ASU 2024-03"), and in January 2025, the FASB issued ASU No. 2025-01, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date ("ASU 2025-01"). ASU 2024-03 requires additional disclosure of the nature of expenses included in the income statement as well as disclosures about specific types of expenses included in the expense captions presented in the income statement. ASU 2024-03, as clarified by ASU 2025-01, is effective for annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Both early adoption and retrospective application are permitted. The Company is currently evaluating the impact that the adoption of these standards will have on its consolidated financial statements.

Except as mentioned above, the Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the Company's consolidated balance sheets, statements of operations and comprehensive loss and statements of cash flows.

**Note 4 – Property and equipment, net**

Property and equipment, net consist of the following:

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| | | |
|:---|:---|:---|
|  | **June 30,<br> 2025** | **June 30,<br> 2024** |
| Leasehold improvement | $620625 | $623804 |
| Office furniture, equipment and others | 88736 | 79772 |
| Motor vehicles | 363340 | 222323 |
| Total | 1072701 | 925899 |
| Less: accumulated depreciation | (857267) | (784165) |
| Total | $215434 | $141734 |

---

Depreciation expense for the years ended June 30, 2025, 2024 and 2023, amounted to approximately $77,692, $305,780 and $293,135, respectively.

During the years ended June 30, 2025, 2024 and 2023, there was a loss on disposal of property and equipment amounted to approximately nil, nil and $1,415 respectively.

**Note 5 – Accrued expenses**

Accrued expenses represent salary and welfare payables, professional fees, utilities, and payables for other operating expenses.

**Note 6 – Related Party Transaction**

Other payables – related parties

During the years ended June 30, 2025 and 2024, other payables – related parties represent reimbursement from related parties and the Company's executive management, Mr. Chung and Mr. Au for out-of-pocket expenses incurred for business purposes. The balances due to Mr. Chung and Mr. Au were nil and approximately $2,539 respectively as of June 30, 2025 and $681 and $7,606 respectively as of June 30, 2024.

During the years ended June 30, 2025 and 2024, the expenses paid for TCM formula and materials for product development to Regeneration Company Limited, a related company, were approximately $0.07 million and $0.09 million, respectively. The reimbursement to Regeneration Company Limited for out-of-pocket expenses incurred for research and development purposes were approximately $0.21 million and $0.21 million, respectively. The balance due to Regeneration Company Limited was nil and approximately $156 respectively as of June 30, 2025 and 2024.

During the years ended June 30, 2025 and 2024, the expenses paid for services fee for research support to Regencell Bioscience Asia Sdn. Bhd., a related company, were nil and approximately $0.03 million respectively. The balance due to Regencell Bioscience Asia Sdn. Bhd., was nil as of June 30, 2025 and 2024.

**Note 7 – Taxes**

Income tax

The income tax provision consisted of the following components:

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| | | | |
|:---|:---|:---|:---|
|  | **For the year ended June 30,** | **For the year ended June 30,** | **For the year ended June 30,** |
|  | **2025** | **2024** | **2023** |
| Current: |  |  |  |
| &nbsp;&nbsp;&nbsp;Hong Kong | $- | $&nbsp;&nbsp;&nbsp;&nbsp;- | $&nbsp;&nbsp;&nbsp;&nbsp;- |
| Deferred: |  |  |  |
| &nbsp;&nbsp;&nbsp;Hong Kong | - | - | - |
| Total provision for income taxes | - | - | - |

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*Cayman Islands and British Virgin Islands ("BVI")*

Under the current laws of the Cayman Islands and BVI, the Company and its subsidiaries are not subject to tax on income or capital gains. Additionally, upon payments of dividends to the shareholders, no Cayman Islands or BVI withholding tax will be imposed.

 

*Hong Kong*

Entities incorporated in Hong Kong are subject to Hong Kong profits tax at a rate of 16.5% on the estimated assessable profit for the years ended June 30, 2025, 2024 and 2023.

The following table reconciles statutory tax rates to the Company's effective tax rate for the periods indicated below:

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| | | | |
|:---|:---|:---|:---|
|  | **For the year ended June 30,** | **For the year ended June 30,** | **For the year ended June 30,** |
|  | **2025** | **2024** | **2023** |
| Tax benefit calculated at statutory tax rate | 16.5% | 16.5% | 16.5% |
| Valuation allowance | (16.5)% | (16.5)% | (16.5)% |
| Effective tax rate | 0.0% | 0.0% | 0.0% |

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The following table sets forth the significant components of the aggregate deferred tax assets:

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| | | | |
|:---|:---|:---|:---|
|  | **As of June 30,** | **As of June 30,** | **As of June 30,** |
|  | **2025** | **2024** | **2023** |
| Deferred tax assets: |  |  |  |
| Net operating loss carry forwards | $3338878 | $2787876 | $2305767 |
| Share-based compensation expenses | 721817 | 681424 | 607288 |
| Less: valuation allowance | (4060695) | (3469300) | (2913055) |
| Deferred tax asset, net | $- | $- | $- |

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The following table sets forth the changes in valuation allowance:

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| | | |
|:---|:---|:---|
|  | **For the year ended<br> June 30,** | **For the year ended<br> June 30,** |
|  | **2025** | **2024** |
| Balance at beginning of the year | $3469300 | $2913055 |
| Addition | 591395 | 720097 |
| Less: Reversal | - | (163852) |
| Balance at end of the year | $4060695 | $3469300 |

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The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the cumulative earnings and projected future taxable income in making this assessment. Recovery of substantially all of the Company's deferred tax assets is dependent upon the generation of future income, exclusive of reversing taxable temporary differences. Based upon historical operating results and projections for future taxable income, management provided full valuation allowance for the deferred tax assets for the years ended June 30, 2025 and 2024. As of June 30, 2025 and 2024, tax loss carry-forward amounted to approximately $20 million and $17 million, respectively can be carried forward indefinitely.

The Company evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measures the unrecognized benefits associated with the tax positions. As of June 30, 2025, and 2024, the Company did not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid income taxes for the years ended June 30, 2025 and 2024. The Company's major tax jurisdiction is Hong Kong. The tax years 2019 through 2025 remain subject to examination by the Hong Kong Inland Revenue Department (the "HKIRD"). The Company also does not anticipate any significant increases or decreases in unrecognized tax benefits in the next 12 months from June 30, 2025.

**Note 8 – Shareholder's equity** 

Ordinary Shares

Regencell Bioscience Holdings Limited (Cayman) was established under the laws of Cayman Islands on October 30, 2014. The authorized number of Ordinary Shares is 100,000,000,000 shares with a par value of $0.00001 per ordinary share, and 494,488,908 Ordinary Shares were issued and outstanding as of June 30, 2025 and 2024, respectively.

On May 31, 2021, the board of directors approved a share subdivision of the Company's authorized number of ordinary shares at a ratio of 1,000-for-1. After the share subdivision, the Company's authorized number of ordinary shares was 100,000,000,000 shares with par value of $0.00001 per share and 10,000,000,000 shares were issued and outstanding accordingly. After the share split, the Company's authorized number of ordinary shares was 100,000,000,000 shares with par value of $0.00001 per share and 10,000,000 shares were issued and outstanding accordingly.

Further on May 29, 2025, the board of directors approved to capitalize an amount standing to the credit of the share premium account of the Company, and appropriate such sum and apply it on behalf of the shareholders towards paying in full (as to the full par value of $0.00001 per Ordinary Share) an aggregate of 481,476,042 Ordinary Shares (representing the receipt by each shareholder of the Company of 37 additional Ordinary Shares for every Ordinary Share held on the record date). This did not result in any changes in authorized share capital or par value of the Ordinary Shares of the Company, nor involve any cash outflow. This is treated as an equity reclassification of a 38-for-1 forward stock split ("38-for-1 forward stock split") under U.S. GAAP. After the 38-for-1 forward share split, the Company's authorized number of Ordinary Shares remain at 100,000,000,000 shares with par value of $0.00001 per share and additional 481,476,042 shares were issued and outstanding accordingly.

The Company believes it is appropriate to reflect these share issuances as nominal share issuance on a retroactive basis similar to share split pursuant to ASC 260. The Company has retroactively adjusted all shares and per share data for all the periods presented.

Initial Public Offering

On July 20, 2021, the Company consummated its IPO of 87,400,000 (after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares at a price of $0.25 (after giving retroactive effect to the 38-for-1 forward stock split) per share. The gross proceeds from IPO were approximately $21.85 million with net proceeds of approximately $19.82 million. As a result of the IPO, the Ordinary Shares now trade on Nasdaq Capital Market under the symbol "RGC". Additional net proceeds of approximately $2.85 million were received on August 20, 2021 from the issue of the overallotment shares and exercise of 12,350,000 (after giving retroactive effect to the 38-for-1 forward stock split) ordinary shares.

2021 Share Option Plan

On May 31, 2021, the Company adopted a 2021 Share Option Plan (the "Plan"). The Plan is a share-based compensation plan that provides for discretionary grants of share options to key employees, directors and consultants of the Company. The purpose of the Plan is to recognize contributions made to the Company and its subsidiaries by such individuals and to provide them with additional incentive to achieve the objectives of the Company.

The Board authorized that the maximum aggregate number of ordinary shares reserved and available pursuant to this Plan shall be the aggregate of (i) 1,235,076 (or 46,932,888 after giving retroactive effect to the 38-for-1 forward stock split) Ordinary Shares, and (ii) on each January 1, starting with January 1, 2022, an additional number of shares equal to the lesser of (A) 2% of the outstanding number of Ordinary Shares (on a fully-diluted basis) on the immediately preceding December 31, and (B) such lower number of Ordinary Shares as may be determined by the board of directors.

On June 9, 2021, the board of the Company granted issuance of 1,235,076 (or 46,932,888 after giving retroactive effect to the 38-for-1 forward stock split) options to certain officers, directors and employees under the Plan; provided that 46,755 (or 1,776,690 after giving retroactive effect to the 38-for-1 forward stock split) options granted to the independent director nominees will become effective upon the effectiveness of the Registration Statement when the nominee's directorship becomes effective. These options will be exercisable at $9.50 (or $0.25 after giving retroactive effect to the 38-for-1 forward stock split) per share, of which 25% vest on each anniversary over four years following the closing of our IPO and is valid for 10 years once vested.

On January 1, 2022, the board of the Company granted issuance of 15,585 (or 592,230 after giving retroactive effect to the 38-for-1 forward stock split) options to a certain director under the Plan. These options will be exercisable at $31.85 (or $0.84 after giving retroactive effect to the 38-for-1 forward stock split) per share, of which 25% vest on each anniversary over four years following the closing of our IPO and is valid for 10 years once vested.

On June 30, 2025, the board of the Company granted issuance of 592,230 options to a certain director under the Plan. These options will be exercisable at $17.40 per share, of which 25% vest on each anniversary over four years following the issuance date and are valid for 10 years once vested.

The Plan became effective upon the completion of the Company's initial public offering on July 20, 2021. It shall continue in effect for a term of ten (10) years unless sooner terminated or unless renewed for another period not to exceed ten (10) years pursuant to shareholder approval. It is intended that share options qualify as "performance-based compensation".

Share-based Compensation

The Company has elected to recognize share-based compensation expense using graded vesting method over the requisite service period, which is the vesting period provided that the amount of compensation cost recognized at any date is at least equal to the portion of the grant-date value of the equity awards that are vested at that date.

The fair value of share options was determined at the date of grant using the Black-Scholes option pricing model or the Binomial option pricing model.

The Black-Scholes option pricing model requires management to make various estimates and assumptions, including expected term, expected volatility, risk-free rate, and dividend yield. The Binomial Option Pricing model requires management to make various estimates and assumptions, including the grant date share price, expected volatility, expected early exercise multiple, option life, risk-free interest rate and dividend yield. For expected volatility, the Company has made reference to historical volatility of several comparable companies in the same industry. The risk-free rate for periods within the contractual life of the options is based on the market yield of U.S. Government Notes with a maturity life equal to the remaining maturity life of the options as of the valuation date. The expected dividend yield is based on our expected dividend policy over the contractual life of the options.

For the years ended June 30, 2025, 2024 and 2023, key inputs used to estimate the fair value of share options on the grant dates are as follows:

 

*Black-Scholes option pricing model*

 

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| | |
|:---|:---|
|  | **Options<br> granted in<br> June<br> 2021** |
| Risk-free interest rate | 0.87% |
| Expected life of the options | 6.25 years |
| Expected volatility | 64.75% |
| Expected dividend yield | 0.00% |
| Fair value | $0.14 \* |

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*Binomial option pricing model*

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| | |
|:---|:---|
|  | **Options<br> granted in<br> January<br> 2022** |
| Fair value of the ordinary shares on the date of option grant | $0.84 \* |
| Risk-free interest rate | 1.53% to 1.589 |
| Option life | 10 years |
| Expected volatility | 88.68% to 94.17 |
| Expected dividend yield | 0.00% |
| Exercise price | $0.84 \* |
| Expected early exercise multiple | 2.80 |

---

---

| | |
|:---|:---|
|  | **Options<br> granted in<br> June 2025** |
| Fair value of the ordinary shares on the date of option grant | $17.40 |
| Risk-free interest rate | 4.23% |
| Option life | 10 years |
| Expected volatility | 65.34% |
| Expected dividend yield | 0.00% |
| Exercise price | $17.40 |
| Expected early exercise multiple | 2.80 |

---

\* These have been restated for the 38-for-1 forward stock split.

A summary of activities of the share options for the years ended June 30, 2025 and 2024 are presented as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Number <br> of Share<br> Options** | **Weighted<br> Average<br> Exercise<br> Price** | **Weighted<br> Average<br> Grant-date Fair value** | **Weighted<br> Average<br> Remaining<br> Contractual<br> Term** | **Weighted<br> Average<br> Remaining<br> Contractual<br> Term** | **Aggregate<br> Intrinsic<br> Value** |
|  | | $ | $ | $Year | Year | $ |
| Outstanding as of July 1, 2023 | 30400304 | 0.26 |  |  | 8.06 |  |
| Granted | - | - |  |  | - |  |
| Expired, forfeited or cancelled | (1727290) | 0.25 |  |  | - |  |
| Outstanding as of June 30, 2024 | 28673014 | 0.26 |  |  | 7.06) |  |
| Granted | 592230 | 17.40 |  |  | 10.00) |  |
| Expired, forfeited or cancelled | (4774738) | 0.25 |  |  | 6.55) |  |
| Outstanding as of June 30, 2025 | 24490506 | 0.68 |  |  | 6.16 |  |
| Exercisable as of June 30, 2025 | 18543582 | 0.25 |  |  | 6.21 |  |
| Vested and Expected to Vest as of June 30, 2025 | 24490506 | 0.68 |  |  | 6.16 |  |

---

Note: The above table reflects the 38-for-1 forward stock split.

During the year ended June 30, 2025, the Company recognized share-based compensation expense of approximately $245,000 (2024: $449,000 and 2023: $923,000) for share options granted.

As of June 30, 2025, total unrecognized employee share-based compensation, may be adjusted for actual forfeitures occurring in the future were approximately $7,789,000 which are expected to be recognized over a weighted-average period of 3.99 years.

Public Offering Warrants

In connection with and upon closing of the Public Offering and overallotment on July 20, 2021 and August 19, 2021 respectively, the Company issued warrants equal to 2.5% of the shares issued in the Public Offering, totaling 57,500 units and 8,125 units to the placement agents for the offering (the "Public Offering Warrants"). The warrants carry a term of five years, and shall not be exercisable for a period of 180 days from the closing of the Public Offering and shall be exercisable at a price equal to $0.28 (after giving retroactive effect to the 38-for-1 forward stock split) per share. Management determined that these warrants meet the definition of a derivative under ASC 815-40, however, they fall under the scope exception which states that contracts issued that are both a) indexed to its own share; and b) classified in shareholders' equity are not considered derivatives. The warrants were recorded at their fair value on the date of grant as a component of shareholders' deficiency.

The aggregated fair value of the Public Offering Warrants on July 20, 2021 was $0.27 million. The fair value has been estimated using the Black-Scholes pricing model with the following weighted-average assumptions: market value of underlying share of $9.27 (or $0.24 after giving retroactive effect to the 38-for-1 forward stock split); risk free rate of 0.68%; expected term of 5 years; exercise price of the warrants of $10.45 (or $0.28 after giving retroactive effect to the 38-for-1 forward stock split); volatility of 65.24%; and expected future dividends of nil. As of June 30, 2025 and the date of this report, all warrants were issued and exercised.

The aggregated fair value of the overallotment Warrants on August 19, 2021 was $0.03 million. The fair value has been estimated using the Binomial model with the following weighted-average assumptions: market value of underlying share of $6.30 (or $0.17 after giving retroactive effect to the 38-for-1 forward stock split); risk free rate of 0.77%; expected term of 5 years; exercise price of the warrants of $10.45 (or $0.28 after giving retroactive effect to the 38-for-1 forward stock split); volatility of 82.66%; and expected future dividends of nil. As of June 30, 2025 and the date of this report, all warrants were issued and exercised.

**Note 9 – Leases**

We determine if an arrangement is or contains a lease at inception. Our assessment is based on (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period and (3) whether we have the right to direct the use of the asset. Leases are classified as either finance leases or operating leases. A lease is classified as a finance lease if any one of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is reasonably certain to be exercised, the lease term is for a major part of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any one of these criteria. The lease classification affects the expense recognition in the statement of income. Operating lease costs are recorded entirely in operating expenses. Finance lease costs are split, where amortization of the ROU asset is recorded in operating expenses and an implied interest component is recorded in interest expense.

Under the new lease standard, operating leases (as lessee) are included in Operating lease right-of-use assets. Operating lease amortization of right of use assets, Operating lease right of use assets, net, Current operating lease liabilities and Noncurrent operating lease liabilities in our accompanying balance sheets. ROU assets and lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. The ROU asset includes any lease payments made but excludes lease incentives and initial direct costs incurred, if any. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

*<u>Lease extensions</u>*

Many of our leases have options to either extend or terminate the lease. In determining the lease term, we considered all available contract extensions that are reasonably certain of occurring.

*<u>Significant assumptions and judgments</u>*

*Incremental borrowing rate.* As most of the leases do not provide an implicit interest rate, we use our incremental borrowing rate ("IBR") at the commencement of the lease and estimate the IBR for each lease agreement taking into consideration lease contract term, collateral and entity credit ratings, and use sensitivity analyses to evaluate the reasonableness of the rates determined.

***Lease balances and costs***

All of the lease agreements that we have entered into are classified as operating leases.

Effective July 15, 2019, we entered into an agreement to lease usage of our Hong Kong office with a third-party entity. The lease was for 5 years term. The lease expired during the year ended June 30, 2025 and we did not renew the lease.

Effective August 2, 2021, we entered into an agreement to lease usage of our Hong Kong office with a third-party entity. The lease was for 3 years term. We renewed the lease during the year ended June 30, 2025. The lease was for 3 years term.

During the years ended June 30, 2024 and 2025, we entered into agreements to lease usage of office space and staff quarters with third parties. The leases were for a three-year term and two-year term respectively.

All the above leases were classified as operating at the inception of the lease. Operating leases result in the recognition of ROU assets and lease liabilities on the balance sheet. ROU assets and operating lease liabilities are recognized based on the present value of lease payments over the lease terms of the commencement date. Because the leases do not provide an explicit or implicit rate of return, the Company determines incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments on an individual lease basis. The incremental borrowing rate for a lease is the rate of interest the Company would have to pay on a collateralized basis to borrow an amount equal to the lease payments for the asset under similar term, which ranged from 5% to 5.88%. The lease does not contain any residual value guarantees or material restrictive covenants. The Company has no finance lease. The components of lease expense consist of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **Classification** | **Year Ended<br> June 30,<br> 2025** | **Year Ended <br> June 30,<br> 2024** |
| Operating lease costs | General and administrative expenses | $315051 | $328073 |
| Operating lease costs | Research and development expenses | - | 111735 |

---

Balance sheet information related to leases consists of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **Classification** | **June 30,<br> 2025** | **June 30,<br> 2024** |
| **Assets** |  |  |  |
| &nbsp;&nbsp;&nbsp;Operating lease – ROU assets | Right-of-use assets | $544385 | $84780 |
| **Liabilities** |  |  |  |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | Current portion | $312780 | $59807 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | Non-current portion | 231635 | 25934 |
| **Total lease liabilities** |  | $544415 | $85741 |
| Weighted average remaining term (years) |  |  |  |
| Operating leases |  | 1.28 | 0.46 |
| Weighted average discount rate |  |  |  |
| Operating leases |  | 5.88% | 5.18% |

---

The following table sets forth the Company's minimum lease payments in future periods:

---

| | |
|:---|:---|
|  | **June 30,<br> 2025** |
| For the years ending June 30, |  |
| 2026 | $336364 |
| 2027 | 220313 |
| 2028 | 17669 |
| &nbsp;&nbsp;&nbsp;Total minimum lease payments | $574346 |
| &nbsp;&nbsp;&nbsp;Less: imputed interest | (29931) |
| &nbsp;&nbsp;&nbsp;Total: | $544415 |

---

**Note 10 – Segment**

In accordance with ASC 280, Segment Reporting, an operating segment is identified as a component of an enterprise that engages in business activities about which separate discrete financial information and operating results is the Company's chief operating decision maker ("CODM") has been identified as the Chief Executive Officer. The Company operates and manages its business as a single segment – in the research and development of the Company's product candidates. The Company's CODM assesses performance for the segment and decides how to allocate resources by regularly reviewing the segment net loss that also is reported as consolidated net loss on the statement of operations and comprehensive loss, after taking into account the Company's strategic priorities, its cash balance, and its expected use of cash. Further, the CODM reviews and utilizes functional expenses (i.e., research and development, and general and administrative) at the consolidated level to manage the Company's operations. Other segment items included are share-based compensation, interest income and other income, net, which are reflected in the segment and consolidated net loss. The measure of segment assets is reported on the consolidated balance sheet as total consolidated assets.

The following table presents financial information, including significant segment expenses, which are regularly provided to the CODM and included within segment and consolidated net loss:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the year ended June 30,** | **For the year ended June 30,** | **For the year ended June 30,** |
|  | **2025** | **2024** | **2023** |
| **Expenses** |  |  |  |
| Operating expenses, excluding share-based compensation, depreciation and amortization expense: |  |  |  |
| Selling and marketing | $8014 | $125427 | $262664 |
| General and administrative |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Salaries and related benefit | 912948 | 1214852 | 1369575 |
| &nbsp;&nbsp;&nbsp;&nbsp;Professional fees | 583293 | 303577 | 526568 |
| &nbsp;&nbsp;&nbsp;&nbsp;Rental expenses | 542749 | 521814 | 575097 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other expenses\* | 499638 | 720949 | 776066 |
|  | 2538628 | 2761192 | 3247306 |
| Research and development |  |  |  |
| &nbsp;&nbsp;&nbsp;Salaries and related benefit | 593804 | 606761 | 712062 |
| &nbsp;&nbsp;&nbsp;Supplies and materials | 73325 | 85910 | 335047 |
| &nbsp;&nbsp;&nbsp;Other expenses\* | 233714 | 402345 | 500834 |
|  | 900843 | 1095016 | 1547943 |
| Share-based compensation |  |  |  |
| &nbsp;&nbsp;&nbsp;General and administrative | 197361 | 478094 | 888938 |
| &nbsp;&nbsp;&nbsp;Research and development | 47447 | (28783) | 33685 |
|  | 244808 | 449311 | 922623 |
| Depreciation | 77692 | 305780 | 293135 |
| Total operating expenses | 3769985 | 4736726 | 6273671 |
| Operating loss | (3769985) | (4736726) | (6273671) |
| Other income, net | 185772 | 373505 | 211342 |
| Income tax expense | - | - | - |
| Segment and consolidated net loss | (3584213) | (4363221) | (6062329) |

---

\* Other expenses include travelling, transportation, entertainment and other sundries expenses.

**Note 11 – Commitments and contingencies**

Contingencies

From time to time, we may be subject to legal or administrative proceedings, investigations and claims arising in the ordinary course of our business. In addition, following recent volatility in the market for our Ordinary Shares, the Company received correspondence and a subpoena from the U.S. Department of Justice ("DOJ"), indicating that the DOJ is conducting an investigation into the trading in our Ordinary Shares. The DOJ has requested the production of documents and communications concerning these and other corporate operational, financial and accounting matters. We are cooperating with this investigation, but we cannot predict its ultimate resolution. We expect to continue to incur significant legal costs and other expenses in connection with responding to the investigation. We may be required to pay fines, penalties, damages or settlement costs in excess of our insurance coverage, if any, related to the investigation. While we are not currently subject to any legal or administrative proceedings, it is possible that government investigations, including the pending investigation in which we are involved, and related legal and administrative proceedings in the future, if any, could result in the institution of administrative, injunctive, or other proceedings against us and/or our directors, officers, or employees or the imposition of fines, suspension, or other remedies and sanctions. Any such material costs and expenses or injunctive relief could have a material adverse effect on our financial condition and results of operations. Since the Company cannot predict the ultimate resolution might have on the Company's financial position, results of operations or liquidity, the Company has not established any provision for losses relating to this matter.

**Note 12 – Subsequent events**

The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the Company issued these consolidated financial statements on October 31, 2025. Based on the review, the Company did not identify any subsequent event that would have required adjustment or disclosure in the consolidated financial statements.

## Exhibit 1.1

**Exhibit 1.1**

**Companies Act (2021 Revision)**

**Company Limited by Shares**

**AMENDED AND RESTATED**

**MEMORANDUM OF ASSOCIATION**

**OF**

**REGENCELL BIOSCIENCE HOLDINGS LIMITED**

(Adopted by Special Resolution passed on May 31, 2021)

---

| | |
|:---|:---|
|  | ![](ex1-1_001.jpg) |
| *www.verify.gov.ky File#: 293256* | *Filed: 04-Jun-2021 09:51 EST* |
|  | *Auth Code: B00676975210* |

---

**Companies Act (2021 Revision)**

**Company Limited by Shares**

**Amended and Restated**

**Memorandum of Association**

**of**

**REGENCELL BIOSCIENCE HOLDINGS LIMITED**

(Adopted by Special Resolution passed on May 31, 2021)

1 The name of the Company is REGENCELL BIOSCIENCE HOLDINGS LIMITED.

2 The Company's registered office will be situated at the offices of Sanne Trustees (Cayman) Limited, 3<sup>rd</sup> Floor, Citrus Grove, 106 Goring Avenue, PO Box 492, Grand Cayman KY1-1106, Cayman Islands or at such other place in the Cayman Islands as the directors may at any time decide.

3 The Company's objects are unrestricted. As provided by section 7(4) of the Companies Act (2021 Revision), the Company has full power and authority to carry out any object not prohibited by any law of the Cayman Islands.

---

| | |
|:---|:---|
| 4 | The Company has unrestricted corporate capacity. Without limitation to the foregoing, as provided by section 27 (2) of the Companies Act (2021 Revision), the Company has and is capable of exercising all the functions of a natural person of full capacity irrespective of any question of corporate benefit. |

---

5 Nothing in any of the preceding paragraphs permits the Company to carry on any of the following businesses without being duly licensed, namely:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the business of a bank or trust company without being licensed in that behalf under the Banks and Trust Companies Act (as Revised);
or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) insurance business from within the Cayman Islands or the business of an insurance manager, agent, sub-agent
or broker without being licensed in that behalf under the Insurance Act (as Revised); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the business of company management without being licensed in that behalf under the Companies Management Act (as Revised).

---

| | |
|:---|:---|
| 6 | The Company will not trade in the Cayman Islands with any person, firm or corporation except in furtherance of its business carried on outside the Cayman Islands. Despite this, the Company may effect and conclude contracts in the Cayman Islands and exercise in the Cayman Islands any of its powers necessary for the carrying on of its business outside the Cayman Islands. |

---

---

| | |
|:---|:---|
|  | ![](ex1-1_001.jpg) |
| *www.verify.gov.ky File#: 293256* | *Filed: 04-Jun-2021 09:51 EST* |
|  | *Auth Code: B00676975210* |

---

 

---

| | |
|:---|:---|
| 7 | The Company is a company limited by shares and accordingly the liability of each member is limited to the amount (if any) unpaid on that member's shares. |

---

---

| | |
|:---|:---|
| 8 | The share capital of the Company is US$1,000,000 divided into 100,000,000,000 Ordinary Shares of US$0.00001 par value each. Subject to the Companies Act (2021 Revision) and the Company's articles of association, the Company has power to do any one or more of the following: |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to redeem or repurchase any of its shares; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to increase or reduce its capital; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) to issue any part of its capital (whether original, redeemed, increased or reduced):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) with or without any preferential, deferred, qualified or special rights, privileges or conditions; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) subject to any limitations or restrictions

and unless the condition of issue expressly declares otherwise, every issue of shares (whether declared to be ordinary, preference or otherwise) is subject to this power; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) to alter any of those rights, privileges, conditions, limitations or restrictions.

9 The Company has power to register by way of continuation as a body corporate limited by shares under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands.

---

| | |
|:---|:---|
|  | ![](ex1-1_001.jpg) |
| *www.verify.gov.ky File#: 293256* | *Filed: 04-Jun-2021 09:51 EST* |
|  | *Auth Code: B00676975210* |

---

**Companies Act (2021 Revision)**

**Company Limited By Shares**

**AMENDED AND RESTATED** 

**ARTICLES OF ASSOCIATION** 

**OF** 

**REGENCELL BIOSCIENCE HOLDINGS LIMITED**

(Adopted by Special Resolution passed on May 31, 2021)

---

| | |
|:---|:---|
|  | ![](ex1-1_001.jpg) |
| *www.verify.gov.ky File#: 293256* | *Filed: 04-Jun-2021 09:51 EST* |
|  | *Auth Code: B00676975210* |

---

**CONTENTS**

---

| | | |
|:---|:---|:---|
| **1** | **Definitions, interpretation and exclusion of Table A** | 1 |
| Definitions | Definitions | 1 |
| Interpretation | Interpretation | 4 |
| Exclusion of Table A Articles | Exclusion of Table A Articles | 4 |
| **2** | **Shares** | 5 |
| Power to issue Shares and options, with or without special rights | Power to issue Shares and options, with or without special rights | 5 |
| Power to pay commissions and brokerage fees | Power to pay commissions and brokerage fees | 5 |
| Trusts not recognised | Trusts not recognised | 5 |
| Security interests | Security interests | 6 |
| Power to vary class rights | Power to vary class rights | 6 |
| Effect of new Share issue on existing class rights | Effect of new Share issue on existing class rights | 6 |
| No bearer Shares or warrants | No bearer Shares or warrants | 6 |
| Treasury Shares | Treasury Shares | 6 |
| Rights attaching to Treasury Shares and related matters | Rights attaching to Treasury Shares and related matters | 7 |
| Register of Members | Register of Members | 7 |
| Annual Return | Annual Return | 7 |
| **3** | **Share certificates** | 8 |
| Issue of share certificates | Issue of share certificates | 8 |
| Renewal of lost or damaged share certificates | Renewal of lost or damaged share certificates | 8 |
| **4** | **Lien on Shares** | 9 |
| Nature and scope of lien | Nature and scope of lien | 9 |
| Company may sell Shares to satisfy lien | Company may sell Shares to satisfy lien | 9 |
| Authority to execute instrument of transfer | Authority to execute instrument of transfer | 9 |
| Consequences of sale of Shares to satisfy lien | Consequences of sale of Shares to satisfy lien | 10 |
| Application of proceeds of sale | Application of proceeds of sale | 10 |
| **5** | **Calls on Shares and forfeiture** | 10 |
| Power to make calls and effect of calls | Power to make calls and effect of calls | 10 |
| Time when call made | Time when call made | 11 |
| Liability of joint holders | Liability of joint holders | 11 |
| Interest on unpaid calls | Interest on unpaid calls | 11 |
| Deemed calls | Deemed calls | 11 |
| Power to accept early payment | Power to accept early payment | 11 |
| Power to make different arrangements at time of issue of Shares | Power to make different arrangements at time of issue of Shares | 11 |
| Notice of default | Notice of default | 12 |
| Forfeiture or surrender of Shares | Forfeiture or surrender of Shares | 12 |
| Disposal of forfeited or surrendered Share and power to cancel forfeiture or surrender | Disposal of forfeited or surrendered Share and power to cancel forfeiture or surrender | 12 |
| Effect of forfeiture or surrender on former Member | Effect of forfeiture or surrender on former Member | 12 |
| Evidence of forfeiture or surrender | Evidence of forfeiture or surrender | 13 |
| Sale of forfeited or surrendered Shares | Sale of forfeited or surrendered Shares | 13 |
| **6** | **Transfer of Shares** | 13 |
| Right to transfer | Right to transfer | 13 |
| Suspension of transfers | Suspension of transfers | 13 |
| Company may retain instrument of transfer | Company may retain instrument of transfer | 14 |
| Notice of refusal to register | Notice of refusal to register | 14 |
| **7** | **Transmission of Shares** | 15 |
| Persons entitled on death of a Member | Persons entitled on death of a Member | 15 |
| Registration of transfer of a Share following death or bankruptcy | Registration of transfer of a Share following death or bankruptcy | 15 |

---

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| | |
|:---|:---|
| i | ![](ex1-1_001.jpg) |
| *www.verify.gov.ky File#: 293256* | *Filed: 04-Jun-2021 09:51 EST* |
|  | *Auth Code: B00676975210* |

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| | | |
|:---|:---|:---|
| Indemnity | Indemnity | 15.0 |
| Rights of person entitled to a Share following death or bankruptcy | Rights of person entitled to a Share following death or bankruptcy | 16.0 |
| **8** | **Alteration of capital** | 16.0 |
| Increasing, consolidating, converting, dividing and cancelling share capital | Increasing, consolidating, converting, dividing and cancelling share capital | 16.0 |
| Dealing with fractions resulting from consolidation of Shares | Dealing with fractions resulting from consolidation of Shares | 16.0 |
| Reducing share capital | Reducing share capital | 17.0 |
| **9** | **Redemption and purchase of own Shares** | 17.0 |
| Power to issue redeemable Shares and to purchase own Shares | Power to issue redeemable Shares and to purchase own Shares | 17.0 |
| Power to pay for redemption or purchase in cash or in specie | Power to pay for redemption or purchase in cash or in specie | 17.0 |
| Effect of redemption or purchase of a Share | Effect of redemption or purchase of a Share | 18.0 |
| **10** | **Meetings of Members** | 18.0 |
| Annual and extraordinary general meetings | Annual and extraordinary general meetings | 18.0 |
| Power to call meetings | Power to call meetings | 18.0 |
| Content of notice | Content of notice | 19.0 |
| Period of notice | Period of notice | 20.0 |
| Persons entitled to receive notice | Persons entitled to receive notice | 20.0 |
| Accidental omission to give notice or non-receipt of notice | Accidental omission to give notice or non-receipt of notice | 20.0 |
| **11** | **Proceedings at meetings of Members** | 21.0 |
| Quorum | Quorum | 21.0 |
| Lack of quorum | Lack of quorum | 21.0 |
| Chairman | Chairman | 21.0 |
| Right of a Director to attend and speak | Right of a Director to attend and speak | 21.0 |
| Accommodation of Members at meeting | Accommodation of Members at meeting | 21.0 |
| Security | Security | 22.0 |
| Adjournment | Adjournment | 22.0 |
| Method of voting | Method of voting | 22.0 |
| Outcome of vote by show of hands | Outcome of vote by show of hands | 23.0 |
| Withdrawal of demand for a poll | Withdrawal of demand for a poll | 23.0 |
| Taking of a poll | Taking of a poll | 23.0 |
| Chairman's casting vote | Chairman's casting vote | 23.0 |
| Written resolutions | Written resolutions | 23.0 |
| Sole-Member Company | Sole-Member Company | 24.0 |
| **12** | **Voting rights of Members** | 24.0 |
| Right to vote | Right to vote | 24.0 |
| Rights of joint holders | Rights of joint holders | 25.0 |
| Representation of corporate Members | Representation of corporate Members | 25.0 |
| Member with mental disorder | Member with mental disorder | 25.0 |
| Objections to admissibility of votes | Objections to admissibility of votes | 26.0 |
| Form of proxy | Form of proxy | 26.0 |
| How and when proxy is to be delivered | How and when proxy is to be delivered | 26.0 |
| Voting by proxy | Voting by proxy | 28.0 |
| **13** | **Number of Directors** | 28.0 |
| **14** | **Appointment, disqualification and removal of Directors** | 28.0 |
| First Directors | First Directors | 28.0 |
| No age limit | No age limit | 28.0 |
| Corporate Directors | Corporate Directors | 29.0 |
| No shareholding qualification | No shareholding qualification | 29.0 |
| Appointment of Directors | Appointment of Directors | 29.0 |
| Board's power to appoint Directors | Board's power to appoint Directors | 29.0 |

---

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| | |
|:---|:---|
| ii | ![](ex1-1_001.jpg) |
| *www.verify.gov.ky File#: 293256* | *Filed: 04-Jun-2021 09:51 EST* |
|  | *Auth Code: B00676975210* |

---

---

| | | |
|:---|:---|:---|
| Eligibility | Eligibility | 29 |
| Appointment at annual general meeting | Appointment at annual general meeting | 30 |
| Removal of Directors | Removal of Directors | 30 |
| Resignation of Directors | Resignation of Directors | 30 |
| Termination of the office of Director | Termination of the office of Director | 30 |
| **15** | **Alternate Directors** | 31 |
| Appointment and removal | Appointment and removal | 31 |
| Notices | Notices | 31 |
| Rights of alternate Director | Rights of alternate Director | 31 |
| Appointment ceases when the appointor ceases to be a Director | Appointment ceases when the appointor ceases to be a Director | 31 |
| Status of alternate Director | Status of alternate Director | 32 |
| Status of the Director making the appointment | Status of the Director making the appointment | 32 |
| **16** | **Powers of Directors** | 32 |
| Powers of Directors | Powers of Directors | 32 |
| Directors below the minimum number | Directors below the minimum number | 32 |
| Appointments to office | Appointments to office | 32 |
| Provisions for employees | Provisions for employees | 33 |
| Exercise of voting rights | Exercise of voting rights | 33 |
| Remuneration | Remuneration | 33 |
| Disclosure of information | Disclosure of information | 34 |
| **17** | **Delegation of powers** | 34 |
| Power to delegate any of the Directors' powers to a committee | Power to delegate any of the Directors' powers to a committee | 34 |
| Local boards | Local boards | 35 |
| Power to appoint an agent of the Company | Power to appoint an agent of the Company | 35 |
| Power to appoint an attorney or authorised signatory of the Company | Power to appoint an attorney or authorised signatory of the Company | 35 |
| Borrowing Powers | Borrowing Powers | 36 |
| Corporate Governance | Corporate Governance | 36 |
| **18** | **Meetings of Directors** | 36 |
| Regulation of Directors' meetings | Regulation of Directors' meetings | 36 |
| Calling meetings | Calling meetings | 36 |
| Notice of meetings | Notice of meetings | 36 |
| Use of technology | Use of technology | 36 |
| Quorum | Quorum | 37 |
| Chairman or deputy to preside | Chairman or deputy to preside | 37 |
| Voting | Voting | 37 |
| Recording of dissent | Recording of dissent | 37 |
| Written resolutions | Written resolutions | 37 |
| Validity of acts of Directors in spite of formal defect | Validity of acts of Directors in spite of formal defect | 38 |
| **19** | **Permissible Directors' interests and disclosure** | 38 |
| **20** | **Minutes** | 39 |
| **21** | **Accounts and audit** | 39 |
| Auditors | Auditors | 40 |
| **22** | **Record dates** | 40 |
| **23** | **Dividends** | 40 |
| Source of dividends | Source of dividends | 40 |
| Declaration of dividends by Members | Declaration of dividends by Members | 41 |
| Payment of interim dividends and declaration of final dividends by Directors | Payment of interim dividends and declaration of final dividends by Directors | 41 |
| Apportionment of dividends | Apportionment of dividends | 42 |

---

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|  | *Auth Code: B00676975210* |

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| | | |
|:---|:---|:---|
| Right of set off | Right of set off | 42.0 |
| Power to pay other than in cash | Power to pay other than in cash | 42.0 |
| How payments may be made | How payments may be made | 42.0 |
| Dividends or other monies not to bear interest in absence of special rights | Dividends or other monies not to bear interest in absence of special rights | 43.0 |
| Dividends unable to be paid or unclaimed | Dividends unable to be paid or unclaimed | 43.0 |
| **24** | **Capitalisation of profits** | 43.0 |
| Capitalisation of profits or of any share premium account or capital redemption reserve; | Capitalisation of profits or of any share premium account or capital redemption reserve; | 43.0 |
| Applying an amount for the benefit of Members | Applying an amount for the benefit of Members | 44.0 |
| **25** | **Share Premium Account** | 44.0 |
| Directors to maintain share premium account | Directors to maintain share premium account | 44.0 |
| Debits to share premium account | Debits to share premium account | 44.0 |
| **26** | **Seal** | 44.0 |
| Company seal | Company seal | 44.0 |
| Duplicate seal | Duplicate seal | 45.0 |
| When and how seal is to be used | When and how seal is to be used | 45.0 |
| If no seal is adopted or used | If no seal is adopted or used | 45.0 |
| Power to allow non-manual signatures and facsimile printing of seal | Power to allow non-manual signatures and facsimile printing of seal | 45.0 |
| Validity of execution | Validity of execution | 45.0 |
| **27** | **Indemnity** | 46.0 |
| Release | Release | 46.0 |
| Insurance | Insurance | 47.0 |
| **28** | **Notices** | 47.0 |
| Form of notices | Form of notices | 47.0 |
| Electronic communications | Electronic communications | 47.0 |
| Persons entitled to notices | Persons entitled to notices | 48.0 |
| Persons authorised to give notices | Persons authorised to give notices | 48.0 |
| Delivery of written notices | Delivery of written notices | 49.0 |
| Joint holders | Joint holders | 49.0 |
| Signatures | Signatures | 49.0 |
| Giving notice to a deceased or bankrupt Member | Giving notice to a deceased or bankrupt Member | 49.0 |
| Date of giving notices | Date of giving notices | 50.0 |
| Saving provision | Saving provision | 50.0 |
| **29** | **Authentication of Electronic Records** | 50.0 |
| Application of Articles | Application of Articles | 50.0 |
| Authentication of documents sent by Members by Electronic means | Authentication of documents sent by Members by Electronic means | 50.0 |
| Authentication of document sent by the Secretary or Officers of the Company by Electronic means | Authentication of document sent by the Secretary or Officers of the Company by Electronic means | 51.0 |
| Manner of signing | Manner of signing | 51.0 |
| Saving provision | Saving provision | 51.0 |
| **30** | **Transfer by way of continuation** | 52.0 |
| **31** | **Winding up** | 52.0 |
| Distribution of assets in specie | Distribution of assets in specie | 52.0 |
| No obligation to accept liability | No obligation to accept liability | 53.0 |
| **32** | **Amendment of Memorandum and Articles** | 53.0 |
| Power to change name or amend Memorandum | Power to change name or amend Memorandum | 53.0 |
| Power to amend these Articles | Power to amend these Articles | 53.0 |

---

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| iv | ![](ex1-1_001.jpg) |
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|  | *Auth Code: B00676975210* |

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**Companies Act (2021 Revision)**

**Company Limited by Shares**

**Amended and Restated**

**Articles of Association**

**of**

**Regencell Bioscience Holdings Limited**

(Adopted by Special Resolution passed on May 31, 2021

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| | |
|:---|:---|
| **1** | **Definitions, interpretation and exclusion of Table A** |

---

**Definitions**

1.1 In these Articles, the following definitions apply:

**Articles** means, as appropriate:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) these articles of association as amended from time to time: or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) two or more particular articles of these Articles;

and **Article** refers to a particular article of these Articles;

**Auditors** means the auditor or auditors for the time being of the Company;

**Board** means the board of Directors from time to time;

**Business Day** means a day when banks in Grand Cayman, the Cayman Islands are open for the transaction of normal banking business and for the avoidance of doubt, shall not include a Saturday, Sunday or public holiday in the Cayman Islands;

**Cayman Islands** means the British Overseas Territory of the Cayman Islands;

**Clear Days**, in relation to a period of notice, means that period excluding:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the day when the notice is given or deemed to be given; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the day for which it is given or on which it is to take effect;

**Commission** means Securities and Exchange Commission of the United States of America or other federal agency for the time being administering the U.S. Securities Act;

**Company** means the above-named company;

 

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**Default Rate** means ten per cent per annum;

**Designated Stock Exchanges** means the Nasdaq Stock Market in the United States of America for so long as the Company's Shares are there listed and any other stock exchange on which the Company's Shares are listed for trading;

**Designated Stock Exchange Rules** means the relevant code, rules and regulations, as amended, from time to time, applicable as a result of the original and continued listing of any Shares on the Designated Stock Exchanges;

**Directors** means the directors for the time being of the Company and the expression Director shall be construed accordingly;

**Electronic** has the meaning given to that term in the Electronic Transactions Act (as Revised) of the Cayman Islands;

**Electronic Record** has the meaning given to that term in the Electronic Transactions Act (as Revised) of the Cayman Islands;

**Electronic Signature** has the meaning given to that term in the Electronic Transactions Act (as Revised) of the Cayman Islands;

**Fully Paid Up** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in relation to a Share with par value, means that the par value for that Share and any premium payable
in respect of the issue of that Share, has been fully paid or credited as paid in money or money's worth; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in relation to a Share without par value, means that the agreed issue price for that Share has been fully paid or credited as paid
in money or money's worth;

**General Meeting** means a general meeting of the Company duly constituted in accordance with the Articles;

**Independent Director** means a Director who is an independent director as defined in the Designated Stock Exchange Rules as determined by the Board;

**Law** means the Companies Act (2021 Revision) of the Cayman Islands, including any statutory modification or re-enactment thereof for the time being in force;

**Member** means any person or persons entered on the register of Members from time to time as the holder of a Share;

**Memorandum** means the memorandum of association of the Company as amended from time to time;

 

**month** means a calendar month;

 

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**Officer** means a person appointed to hold an office in the Company including a Director, alternate Director or liquidator and excluding the Secretary;

**Ordinary Resolution** means a resolution of a General Meeting passed by a simple majority of Members who (being entitled to do so) vote in person or by proxy at that meeting. The expression includes a unanimous written resolution;

**Ordinary Share** means an ordinary share in the capital of the Company;

**Partly Paid Up** means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in relation to a Share with par value, that the par value for that Share and any premium payable in respect
of the issue of that Share, has not been fully paid or credited as paid in money or money's worth; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in relation to a Share without par value, means that the agreed issue price for that Share has not been fully paid or credited as
paid in money or money's worth;

**Secretary** means a person appointed to perform the duties of the secretary of the Company, including a joint, assistant or deputy secretary;

**Share** means a share in the capital of the Company and the expression:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) includes stock (except where a distinction between shares and stock is expressed or implied); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) where the context permits, also includes a fraction of a Share;

**Special Resolution** means a resolution of a General Meeting or a resolution of a meeting of the holders of any class of Shares in a class meeting duly constituted in accordance with the Articles in each case passed by a majority of not less than two-thirds of Members who (being entitled to do so) vote in person or by proxy at that meeting. The expression includes a unanimous written resolution;

**Treasury Shares** means Shares held in treasury pursuant to the Law and Article 2.12; and

**U.S. Securities Act** means the Securities Act of 1933 of the United States of America, as amended, or any similar federal statute and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.

 

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**Interpretation**

1.2 In the interpretation of these Articles, the following provisions apply unless the context otherwise
requires:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) A reference in these Articles to a statute is a reference to a statute of the Cayman Islands as known by its short title, and includes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any statutory modification, amendment or re-enactment; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any subordinate legislation or regulations issued under that statute.

Without limitation to the preceding sentence, a reference to a revised Law of the Cayman Islands is taken to be a reference to the revision of that Law in force from time to time as amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Headings are inserted for convenience only and do not affect the interpretation of these Articles, unless there is ambiguity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If a day on which any act, matter or thing is to be done under these Articles is not a Business Day, the act, matter or thing must
be done on the next Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) A word which denotes the singular also denotes the plural, a word which denotes the plural also denotes
the singular, and a reference to any gender also denotes the other genders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) A reference to a **person** includes, as appropriate, a company, trust, partnership, joint venture, association, body corporate
or government agency.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Where a word or phrase is given a defined meaning another part of speech or grammatical form in respect to that word or phrase has
a corresponding meaning.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) All references to time are to be calculated by reference to time in the place where the Company's registered office is located.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) The words **written** and **in writing** include all modes of representing or reproducing words
in a visible form, but do not include an Electronic Record where the distinction between a document in writing and an Electronic Record
is expressed or implied.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The words **including**, **include** and **in particular** or any similar expression are to be construed without limitation.

1.3 The headings in these Articles are intended for convenience only and shall
not affect the interpretation of these Articles.

**Exclusion of Table A Articles**

1.4 The regulations contained in Table A in the First Schedule of the Law and
any other regulations contained in any statute or subordinate legislation are expressly excluded and do not apply to the Company.

 

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|:---|:---|
| **2** | **Shares** |

---

**Power to issue Shares and options, with or without special rights**

2.1 Subject to the provisions of the Law and these Articles about the redemption
and purchase of the Shares, the Directors have general and unconditional authority to allot (with or without confirming rights of renunciation),
grant options over or otherwise deal with any unissued Shares to such persons, at such times and on such terms and conditions as they
may decide. No Share may be issued at a discount except in accordance with the provisions of the Law.

2.2 Without limitation to the preceding
Article, the Directors may so deal with the unissued Shares:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) either at a premium or at par; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) with or without preferred, deferred or other special rights or restrictions, whether in regard to dividend, voting, return of capital
or otherwise.

2.3 Without limitation to the two preceding Articles, the Directors may refuse
to accept any application for Shares, and may accept any application in whole or in part, for any reason or for no reason.

**Power to pay commissions and brokerage fees**

2.4 The Company may pay a commission
to any person in consideration of that person:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) subscribing or agreeing to subscribe, whether absolutely or conditionally; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) procuring or agreeing to procure subscriptions, whether absolute or conditional,

for any Shares. That commission may be satisfied by the payment of cash or the allotment of Fully Paid Up or Partly Paid Up Shares or partly in one way and partly in another.

2.5 The Company may employ a broker in the issue of its capital and pay him any proper commission or brokerage.

**Trusts not recognised**

2.6 Except as required by Law:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) no person shall be recognised by the Company as holding any Share on any trust; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) no person other than the Member shall be recognised by the Company as having any right in a Share.

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**Security interests**

2.7 Notwithstanding the preceding Article, the Company may (but shall not be
obliged to) recognise a security interest of which it has actual notice over shares. The Company shall not be treated as having recognised
any such security interest unless it has so agreed in writing with the secured party.

**Power to vary class rights**

2.8 If the share capital is divided into different classes of Shares then, unless
the terms on which a class of Shares was issued state otherwise, the rights attaching to a class of Shares may only be varied if one of
the following applies:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Members holding not less than two-thirds of the issued Shares of that class consent in writing to the variation; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the variation is made with the sanction of a Special Resolution passed at a separate general meeting of the Members holding the issued
Shares of that class.

2.9 For the purpose of Article 2.8(b), all the provisions of these Articles relating to general meetings
apply, mutatis mutandis, to every such separate meeting except that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the necessary quorum shall be one or more persons holding, or representing by proxy, not less than one third of the issued Shares
of the class; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any Member holding issued Shares of the class, present in person or by proxy or, in the case of a corporate
Member, by its duly authorised representative, may demand a poll.

**Effect of new Share issue on existing class rights**

2.10 Unless the terms on which a class of Shares was issued state otherwise,
the rights conferred on the Member holding Shares of any class shall not be deemed to be varied by the creation or issue of further Shares
ranking *pari passu* with the existing Shares of that class.

**No bearer Shares or warrants**

2.11 The Company shall not issue Shares or warrants to bearers.

**Treasury Shares**

2.12 Shares that the Company purchases, redeems or acquires by way of surrender
in accordance with the Law shall be held as Treasury Shares and not treated as cancelled if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Directors so determine prior to the purchase, redemption or surrender of those shares; and

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the relevant provisions of the Memorandum and Articles and the Law are otherwise complied with.

**Rights attaching to Treasury Shares and related matters**

2.13 No dividend may be declared or paid, and no other distribution (whether
in cash or otherwise) of the Company's assets (including any distribution of assets to Members on a winding up) may be made to the
Company in respect of a Treasury Share.

2.14 The Company shall be entered in the register of Members as the holder of
the Treasury Shares. However:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Company shall not be treated as a Member for any purpose and shall not exercise any right in respect
of the Treasury Shares, and any purported exercise of such a right shall be void; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a Treasury Share shall not be voted, directly or indirectly, at any meeting of the Company and shall not
be counted in determining the total number of issued shares at any given time, whether for the purposes of these Articles or the Law.

2.15 Nothing in Article 2.14 prevents an allotment of Shares as Fully Paid Up
bonus shares in respect of a Treasury Share and Shares allotted as Fully Paid Up bonus shares in respect of a Treasury Share shall be
treated as Treasury Shares.

2.16 Treasury Shares may be disposed of by the Company in accordance with the
Law and otherwise on such terms and conditions as the Directors determine.

**Register of Members**

2.17 The Directors shall keep or cause to be kept a register of Members as required
by the Law and may cause the Company to maintain one or more branch registers as contemplated by the Law, provided that where the Company
is maintaining one or more branch registers, the Directors shall ensure that a duplicate of each branch register is kept with the Company's
principal register of Members and updated within such number of days of any amendment having been made to such branch register as may
be required by the Law.

**Annual Return**

2.18 The Directors in each calendar year shall prepare or cause to be prepared
an annual return and declaration setting forth the particulars required by the Law and shall deliver a copy thereof to the Registrar of
Companies for the Cayman Islands.

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|:---|:---|
| **3** | **Share certificates** |

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**Issue of share certificates**

3.1 A Member shall only be entitled to a share certificate if the Directors
resolve that share certificates shall be issued. Share certificates representing Shares, if any, shall be in such form as the Directors
may determine. If the Directors resolve that share certificates shall be issued, upon being entered in the register of Members as the
holder of a Share, the Directors may issue to any Member:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) without payment, one certificate for all the Shares of each
class held by that Member (and, upon transferring a part of the Member's holding of Shares of any class, to a certificate for the
balance of that holding); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) upon payment of such reasonable sum as the Directors may determine
for every certificate after the first, several certificates each for one or more of that Member's Shares.

3.2 Every certificate shall specify the number, class and distinguishing numbers
(if any) of the Shares to which it relates and whether they are Fully Paid Up or Partly Paid Up. A certificate may be executed under seal
or executed in such other manner as the Directors determine.

3.3 Every certificate shall bear legends
required under the applicable laws, including the U.S. Securities Act.

3.4 The Company shall not be bound to issue more than one certificate for Shares
held jointly by several persons and delivery of a certificate for a Share to one joint holder shall be a sufficient delivery to all of
them.

**Renewal of lost or damaged share certificates**

3.5 If a share certificate is defaced, worn-out, lost or destroyed, it may be
renewed on such terms (if any) as to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) evidence;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) indemnity;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) payment of the expenses reasonably incurred by the Company in investigating the evidence; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) payment of a reasonable fee, if any for issuing a replacement share certificate,

as the Directors may determine, and (in the case of defacement or wearing-out) on delivery to the Company of the old certificate.

---

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|:---|:---|
| **4** | **Lien on Shares** |

---

**Nature and scope of lien**

4.1 The Company has a first and paramount lien on all Shares (whether Fully
Paid Up or not) registered in the name of a Member (whether solely or jointly with others). The lien is for all monies payable to the
Company by the Member or the Member's estate:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) either alone or jointly with any other person, whether or not that other person is a Member; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) whether or not those monies are presently payable.

4.2 At any time the Board may declare any Share to be wholly or partly exempt from the provisions of this
Article.

**Company may sell Shares to satisfy lien**

4.3 The Company may sell any Shares over which it has a lien if all of the following conditions are met:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the sum in respect of which the lien exists is presently payable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Company gives notice to the Member holding the Share (or to the person entitled to it in consequence
of the death or bankruptcy of that Member) demanding payment and stating that if the notice is not complied with the Shares may be sold;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) that sum is not paid within fourteen Clear Days after that notice is deemed to be given under these Articles,

and Shares to which this Article 4.3 applies shall be referred to as Lien Default Shares.

4.4 The Lien Default Shares may be
sold in such manner as the Board determines.

4.5 To the maximum extent permitted by law, the Directors shall incur no personal
liability to the Member concerned in respect of the sale.

**Authority to execute instrument of transfer**

4.6 To give effect to a sale, the Directors may authorise any person to execute
an instrument of transfer of the Lien Default Shares sold to, or in accordance with the directions of, the purchaser.

4.7 The title of the transferee of the Lien Default Shares shall not be affected
by any irregularity or invalidity in the proceedings in respect of the sale.

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**Consequences of sale of Shares to satisfy lien**

4.8 On a sale pursuant to the preceding
Articles:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the name of the Member concerned shall be removed from the register of Members as the holder of those Lien Default Shares; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) that person shall deliver to the Company for cancellation the certificate (if any) for those Lien Default Shares.

4.9 Notwithstanding the provisions of Article 4.8, such person shall remain
liable to the Company for all monies which, at the date of sale, were presently payable by him to the Company in respect of those Lien
Default Shares. That person shall also be liable to pay interest on those monies from the date of sale until payment at the rate at which
interest was payable before that sale or, failing that, at the Default Rate. The Board may waive payment wholly or in part or enforce
payment without any allowance for the value of the Lien Default Shares at the time of sale or for any consideration received on their
disposal.

**Application of proceeds of sale**

4.10 The net proceeds of the sale, after payment of the costs, shall be applied
in payment of so much of the sum for which the lien exists as is presently payable. Any residue shall be paid to the person whose Lien
Default Shares have been sold:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) if no certificate for the Lien Default Shares was issued, at the date of the sale; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if a certificate for the Lien Default Shares was issued, upon surrender to the Company of that certificate for cancellation

but, in either case, subject to the Company retaining a like lien for all sums not presently payable as existed on the Lien Default Shares before the sale.

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| | |
|:---|:---|
| **5** | **Calls on Shares and forfeiture** |

---

**Power to make calls and effect of calls**

5.1 Subject to the terms of allotment, the Board may make calls on the Members
in respect of any monies unpaid on their Shares including any premium. The call may provide for payment to be by instalments. Subject
to receiving at least 14 Clear Days' notice specifying when and where payment is to be made, each Member shall pay to the Company the
amount called on his Shares as required by the notice.

5.2 Before receipt by the Company of any sum due under a call, that call may
be revoked in whole or in part and payment of a call may be postponed in whole or in part. Where a call is to be paid in instalments,
the Company may revoke the call in respect of all or any remaining instalments in whole or in part and may postpone payment of all or
any of the remaining instalments in whole or in part.

---

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5.3 A Member on whom a call is made shall remain liable for that call notwithstanding
the subsequent transfer of the Shares in respect of which the call was made. He shall not be liable for calls made after he is no longer
registered as Member in respect of those Shares.

**Time when call made**

5.4 A call shall be deemed to have been made at the time when the resolution
of the Directors authorising the call was passed.

**Liability of joint holders**

5.5 Members registered as the joint holders of a Share shall be jointly and
severally liable to pay all calls in respect of the Share.

**Interest on unpaid calls**

5.6 If a call remains unpaid after it has become due and payable the person
from whom it is due and payable shall pay interest on the amount unpaid from the day it became due and payable until it is paid:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) at the rate fixed by the terms of allotment of the Share or in the notice of the call; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if no rate is fixed, at the Default Rate.

The Directors may waive payment of the interest wholly or in part.

**Deemed calls**

5.7 Any amount payable in respect of a Share, whether on allotment or on a fixed
date or otherwise, shall be deemed to be payable as a call. If the amount is not paid when due the provisions of these Articles shall
apply as if the amount had become due and payable by virtue of a call.

**Power to accept early payment**

5.8 The Company may accept from a Member the whole or a part of the amount remaining
unpaid on Shares held by him although no part of that amount has been called up.

**Power to make different arrangements at time of issue of Shares**

5.9 Subject to the terms of allotment, the Directors may make arrangements on
the issue of Shares to distinguish between Members in the amounts and times of payment of calls on their Shares.

---

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**Notice of default**

5.10 If a call remains unpaid after it has become due and payable the Directors may give to the person from
whom it is due not less than 14 Clear Days' notice requiring payment of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the amount unpaid;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any interest which may have accrued;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any expenses which have been incurred by the Company due to that person's default.

5.11 The notice shall state the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the place where payment is to be made; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a warning that if the notice is not complied with the Shares in respect of which the call is made will be liable to be forfeited.

**Forfeiture or surrender of Shares**

5.12 If the notice given pursuant to Article 5.10 is not complied with, the Directors
may, before the payment required by the notice has been received, resolve that any Share the subject of that notice be forfeited. The
forfeiture shall include all dividends or other monies payable in respect of the forfeited Share and not paid before the forfeiture. Despite
the foregoing, the Board may determine that any Share the subject of that notice be accepted by the Company as surrendered by the Member
holding that Share in lieu of forfeiture.

**Disposal of forfeited or surrendered Share and power to cancel forfeiture or surrender**

5.13 A forfeited or surrendered Share may be sold, re-allotted or otherwise disposed
of on such terms and in such manner as the Board determine either to the former Member who held that Share or to any other person. The
forfeiture or surrender may be cancelled on such terms as the Directors think fit at any time before a sale, re-allotment or other disposition.
Where, for the purposes of its disposal, a forfeited or surrendered Share is to be transferred to any person, the Directors may authorise
some person to execute an instrument of transfer of the Share to the transferee.

**Effect of forfeiture or surrender on former Member**

5.14 On forfeiture or surrender:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the name of the Member concerned shall be removed from the register of Members as the holder of those
Shares and that person shall cease to be a Member in respect of those Shares; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) that person shall surrender to the Company for cancellation the certificate (if any) for the forfeited or surrendered Shares.

---

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5.15 Despite the forfeiture or surrender of his Shares, that person shall remain
liable to the Company for all monies which at the date of forfeiture or surrender were presently payable by him to the Company in respect
of those Shares together with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all expenses; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) interest from the date of forfeiture or surrender until payment:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) at the rate of which interest was payable on those monies before forfeiture; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) if no interest was so payable, at the Default Rate.

The Directors, however, may waive payment wholly or in part.

**Evidence of forfeiture or surrender**

5.16 A declaration, whether statutory or under oath, made by a Director or the
Secretary shall be conclusive evidence of the following matters stated in it as against all persons claiming to be entitled to forfeited
Shares:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) that the person making the declaration is a Director or Secretary of the Company, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) that the particular Shares have been forfeited or surrendered on a particular date.

Subject to the execution of an instrument of transfer, if necessary, the declaration shall constitute good title to the Shares.

**Sale of forfeited or surrendered Shares**

5.17 Any person to whom the forfeited or surrendered Shares are disposed of shall
not be bound to see to the application of the consideration, if any, of those Shares nor shall his title to the Shares be affected by
any irregularity in, or invalidity of the proceedings in respect of, the forfeiture, surrender or disposal of those Shares.

---

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| **6** | **Transfer of Shares** |

---

**Right to transfer**

6.1 The instrument of transfer of any Share shall be in writing and in any usual
or common form or such other form as the Directors may, in their absolute discretion, approve and be executed by or on behalf of the transferor
and if in respect of a nil or Partly Paid Up Share, or if so required by the Directors, shall also be executed on behalf of the transferee
and shall be accompanied by the certificate (if any) of the Shares to which it relates and such other evidence as the Directors may reasonably
require to show the right of the transferor to make the transfer. The transferor shall be deemed to remain a Member until the name of
the transferee is entered in the register of Members in respect of the relevant Shares.

---

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6.2 The Directors may in their absolute discretion decline to register any transfer of Shares which is not
Fully Paid Up or on which the Company has a lien.

6.3 The Directors may also, but are not required to, decline to register any transfer of any Share unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the instrument of transfer is lodged with the Company, accompanied by the certificate (if any) for the
Shares to which it relates and such other evidence as the Board may reasonably require to show the right of the transferor to make the
transfer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the instrument of transfer is in respect of only one class of Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the instrument of transfer is properly stamped, if required;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) in the case of a transfer to joint holders, the number of joint holders to whom the Share is to be transferred does not exceed four;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the Shares transferred are Fully Paid Up and free of any lien in favour of the Company; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any applicable fee of such maximum sum as the Designated Stock Exchanges may determine to be payable,
or such lesser sum as the Board may from time to time require, related to the transfer is paid to the Company.

**Suspension of transfers**

6.4 The registration of transfers may, on 14 days' notice being given
by advertisement in such one or more newspapers or by electronic means, be suspended and the register of Members closed at such times
and for such periods as the Directors may, in their absolute discretion, from time to time determine, provided always that such registration
of transfer shall not be suspended nor the register of Members closed for more than 30 days in any year.

**Company may retain instrument of transfer**

6.5 All instruments of transfer that
are registered shall be retained by the Company.

**Notice of refusal to register**

6.6 If the Directors refuse to register a transfer of any Shares, they shall
within three months after the date on which the instrument of transfer was lodged with the Company send to each of the transferor and
the transferee notice of the refusal.

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| **7** | **Transmission of Shares** |

---

**Persons entitled on death of a Member**

7.1 If a Member dies, the only persons recognised by the Company as having any title to the deceased Members'
interest are the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) where the deceased Member was a joint holder, the survivor or survivors; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) where the deceased Member was a sole holder, that Member's personal representative or representatives.

7.2 Nothing in these Articles shall release the deceased Member's estate from any liability in respect
of any Share, whether the deceased was a sole holder or a joint holder.

**Registration of transfer of a Share following death or bankruptcy**

7.3 A person becoming entitled to
a Share in consequence of the death or bankruptcy of a

Member may elect to do either of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to become the holder of the Share; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to transfer the Share to another person.

7.4 That person must produce such evidence of his entitlement as the Directors
may properly require.

7.5 If the person elects to become the holder of the Share, he must give notice
to the Company to that effect. For the purposes of these Articles, that notice shall be treated as though it were an executed instrument
of transfer.

7.6 If the person elects to transfer
the Share to another person then:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) if the Share is Fully Paid Up, the transferor must execute an instrument of transfer; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if the Share is nil or Partly Paid Up, the transferor and the transferee must execute an instrument of transfer.

7.7 All the Articles relating to the transfer of Shares shall apply to the notice
or, as appropriate, the instrument of transfer.

**Indemnity**

7.8 A person registered as a Member by reason of the death or bankruptcy of
another Member shall indemnify the Company and the Directors against any loss or damage suffered by the Company or the Directors as a
result of that registration.

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**Rights of person entitled to a Share following death or bankruptcy**

7.9 A person becoming entitled to a Share by reason of the death or bankruptcy
of a Member shall have the rights to which he would be entitled if he were registered as the holder of the Share. But, until he is registered
as Member in respect of the Share, he shall not be entitled to attend or vote at any meeting of the Company or at any separate meeting
of the holders of that class of Shares.

---

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|:---|:---|
| **8** | **Alteration of capital** |

---

**Increasing, consolidating, converting, dividing and cancelling share capital**

8.1 To the fullest extent permitted by the Law, the Company may by Ordinary
Resolution do any of the following and amend its Memorandum for that purpose:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) increase its share capital by new Shares of the amount fixed
by that Ordinary Resolution and with the attached rights, priorities and privileges set out in that Ordinary Resolution;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) consolidate and divide all or any of its share capital into Shares of larger amount than its existing Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) convert all or any of its Paid Up Shares into stock, and reconvert that stock into Paid Up Shares of any denomination;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) sub-divide its Shares or any of them into Shares of an amount smaller than that fixed by the Memorandum,
so, however, that in the sub-division, the proportion between the amount paid and the amount, if any, unpaid on each reduced Share shall
be the same as it was in case of the Share from which the reduced Share is derived; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) cancel Shares which, at the date of the passing of that Ordinary Resolution, have not been taken or agreed
to be taken by any person, and diminish the amount of its share capital by the amount of the Shares so cancelled or, in the case of Shares
without nominal par value, diminish the number of Shares into which its capital is divided.

**Dealing with fractions resulting from consolidation of Shares**

8.2 Whenever, as a result of a consolidation of Shares, any Members would become
entitled to fractions of a Share the Directors may on behalf of those Members deal with the fractions as it thinks fit, including (without
limitation):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) either round up or down the fraction to the nearest whole number, such rounding to be determined by the Directors acting in their
sole discretion; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) sell the Shares representing the fractions for the best price reasonably obtainable to any person (including, subject to the provisions
of the Law, the Company); and

---

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) distribute the net proceeds in due proportion among those Members.

8.3 For the purposes of Article 8.2, the Directors may authorise some person
to execute an instrument of transfer of the Shares to, in accordance with the directions of, the purchaser. The transferee shall not be
bound to see to the application of the purchase money nor shall the transferee's title to the Shares be affected by any irregularity
in, or invalidity of, the proceedings in respect of the sale.

**Reducing share capital**

8.4 Subject to the Law and to any rights for the time being conferred on the
Members holding a particular class of Shares, the Company may, by Special Resolution, reduce its share capital in any way.

---

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| **9** | **Redemption and purchase of own Shares** |

---

**Power to issue redeemable Shares and to purchase own Shares**

9.1 Subject to the Law and to any rights for the time being conferred on the
Members holding a particular class of Shares, the Company may by its Directors:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) issue Shares that are to be redeemed or liable to be redeemed, at the option of the Company or the Member
holding those redeemable Shares, on the terms and in the manner its Directors determine before the issue of those Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) with the consent by Special Resolution of the Members holding Shares of a particular class, vary the rights
attaching to that class of Shares so as to provide that those Shares are to be redeemed or are liable to be redeemed at the option of
the Company on the terms and in the manner which the Directors determine at the time of such variation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) purchase all or any of its own Shares of any class including any redeemable Shares on the terms and in
the manner which the Directors determine at the time of such purchase.

The Company may make a payment in respect of the redemption or purchase of its own Shares in any manner authorised by the Law, including out of any combination of the following: capital, its profits and the proceeds of a fresh issue of Shares.

**Power to pay for redemption or purchase in cash or in specie**

9.2 When making a payment in respect of the redemption or purchase of Shares,
the Directors may make the payment in cash or *in specie* (or partly in one and partly in the other) if so authorised by the terms
of the allotment of those Shares or by the terms applying to those Shares in accordance with Article 9.1, or otherwise by agreement with
the Member holding those Shares.

---

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**Effect of redemption or purchase of a Share**

9.3 Upon the date of redemption or
purchase of a Share:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Member holding that Share shall cease to be entitled to any rights in respect of the Share other than the right to receive:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the price for the Share; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any dividend declared in respect of the Share prior to the date of redemption or purchase;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Member's name shall be removed from the register of Members with respect to the Share; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Share shall be cancelled or held as a Treasury Share, as the Directors may determine.

9.4 For the purpose of Article 9.3, the date of redemption or purchase is the
date when the Member's name is removed from the register of Members with respect to the Shares the subject of the redemption or purchase.

---

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| **10** | **Meetings of Members** |

---

**Annual and extraordinary general meetings**

10.1 The Company may, but shall not (unless required by the Designated Stock
Exchange Rules) be obligated to, in each year hold a general meeting as an annual general meeting, which, if held, shall be convened by
the Board, in accordance with these Articles.

10.2 All general meetings other than annual general meetings shall be called
extraordinary general meetings.

**Power to call meetings**

10.3 The Directors may call a general
meeting at any time.

10.4 If there are insufficient Directors to constitute a quorum and the remaining
Directors are unable to agree on the appointment of additional Directors, the Directors must call a general meeting for the purpose of
appointing additional Directors.

10.5 The Directors must also call a general meeting if requisitioned in the manner
set out in the next two Articles.

10.6 The requisition must be in writing and given by one or more Members who
together hold at least ten per cent of the rights to vote at such general meeting.

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10.7 The requisition must also:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) specify the purpose of the meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) be signed by or on behalf of each requisitioner (and for this purpose each joint holder shall be obliged
to sign). The requisition may consist of several documents in like form signed by one or more of the requisitioners; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) be delivered in accordance with the notice provisions.

10.8 Should the Directors fail to call a general meeting within 21 Clear Days'
from the date of receipt of a requisition, the requisitioners or any of them may call a general meeting within three months after the
end of that period.

10.9 Without limitation to the foregoing, if there are insufficient Directors
to constitute a quorum and the remaining Directors are unable to agree on the appointment of additional Directors, any one or more Members
who together hold at least five per cent of the rights to vote at a general meeting may call a general meeting for the purpose of considering
the business specified in the notice of meeting which shall include as an item of business the appointment of additional Directors.

10.10 If the Members call a meeting under the above provisions, the Company shall reimburse their reasonable
expenses.

**Content of notice**

10.11 Notice of a general meeting shall specify each of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the place, the date and the hour of the meeting;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if the meeting is to be held in two or more places, the technology that will be used to facilitate the meeting;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) subject to paragraph (d) and the requirements of (to the extent applicable) the Designated Stock Exchange
Rules, the general nature of the business to be transacted; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) if a resolution is proposed as a Special Resolution, the text of that resolution.

10.12 In each notice there shall appear with reasonable prominence
the following statements:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) that a Member who is entitled to attend and vote is entitled to appoint one or more proxies to attend and vote instead of that Member;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) that a proxyholder need not be a Member.

---

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**Period of notice**

10.13 At least twenty-one Clear Days' notice of an annual general meeting must be given to Members. For any
other general meeting, at least fourteen Clear Days' notice must be given to Members.

10.14 Subject to the Law, a meeting may be convened on shorter notice, subject to the Law with the consent of
the Member or Members who, individually or collectively, hold at least ninety per cent of the voting rights of all those who have a right
to vote at that meeting.

**Persons entitled to receive notice**

10.15 Subject to the provisions of these Articles and to any restrictions imposed on any Shares, the notice
shall be given to the following people:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Members

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) persons entitled to a Share in consequence of the death or bankruptcy of a Member;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Directors; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the Auditors.

10.16 The Board may determine that the Members entitled to receive notice of a meeting are those persons entered
on the register of Members at the close of business on a day determined by the Board.

**Accidental omission to give notice or non-receipt of notice**

10.17 Proceedings at a meeting shall not be invalidated by the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) an accidental failure to give notice of the meeting to any person entitled to notice; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) non-receipt of notice of the meeting by any person entitled to notice.

10.18 In addition, where a notice of meeting is published on a website proceedings at the meeting shall not be invalidated merely because
it is accidentally published:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in a different place on the website; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) for part only of the period from the date of the notification until the conclusion of the meeting to which the notice relates.

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|:---|:---|
| **11** | **Proceedings at meetings of Members** |

---

**Quorum**

11.1 Save as provided in the following Article, no business shall be transacted at any meeting unless a quorum
is present in person or by proxy. A quorum is as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) if the Company has only one Member: that Member;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if the Company has more than one Member: one or more Members holding Shares that represent not less than
one-third of the outstanding Shares carrying the right to vote at such general meeting.

**Lack of quorum**

11.2 If a quorum is not present within fifteen minutes of the time
appointed for the meeting, or if at any time during the meeting it becomes inquorate, then the following provisions apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If the meeting was requisitioned by Members, it shall be cancelled.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In any other case, the meeting shall stand adjourned to the same time and place seven days hence, or to
such other time or place as is determined by the Directors. If a quorum is not present within fifteen minutes of the time appointed for
the adjourned meeting, then the Members present in person or by proxy shall constitute a quorum.

**Chairman**

11.3 The chairman of a general meeting shall be the chairman of the Board or
such other Director as the Directors have nominated to chair Board meetings in the absence of the chairman of the Board. Absent any such
person being present within fifteen minutes of the time appointed for the meeting, the Directors present shall elect one of their number
to chair the meeting.

11.4 If no Director is present within fifteen minutes of the time appointed for
the meeting, or if no Director is willing to act as chairman, the Members present in person or by proxy and entitled to vote shall choose
one of their number to chair the meeting.

**Right of a Director to attend and speak**

11.5 Even if a Director is not a Member, he shall be entitled to attend and speak
at any general meeting and at any separate meeting of Members holding a particular class of Shares.

**Accommodation of Members at meeting**

11.6 lf it appears to the chairman of the meeting that the meeting place specified
in the notice convening the meeting is inadequate to accommodate all Members entitled and wishing to attend, the meeting will be duly
constituted and its proceedings valid if the chairman is satisfied that adequate facilities are available to ensure
that a Member who is unable to be accommodated is able (whether at the meeting place or elsewhere):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to participate in the business for which the meeting has been convened;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to hear and see all persons present who speak (whether by the use of microphones, loud-speakers, audio-visual communications equipment
or otherwise); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) to be heard and seen by all other persons present in the same way.

**Security**

11.7 In addition to any measures which the Board may be required to take due
to the location or venue of the meeting, the Board may make any arrangement and impose any restriction it considers appropriate and reasonable
in the circumstances to ensure the security of a meeting including, without limitation, the searching of any person attending the meeting
and the imposing of restrictions on the items of personal property that may be taken into the meeting place. The Board may refuse entry
to, or eject from, a meeting a person who refuses to comply with any such arrangements or restrictions.

**Adjournment**

11.8 The chairman may at any time adjourn a meeting with the consent of the Members
constituting a quorum. The chairman must adjourn the meeting if so directed by the meeting. No business, however, can be transacted at
an adjourned meeting other than business which might properly have been transacted at the original meeting.

11.9 Should a meeting be adjourned for more than 7 Clear Days, whether because
of a lack of quorum or otherwise, Members shall be given at least seven Clear Days' notice of the date, time and place of the adjourned
meeting and the general nature of the business to be transacted. Otherwise it shall not be necessary to give any notice of the adjournment.

**Method of voting**

11.10 A resolution put to the vote of the meeting shall be decided on a show of hands unless before, or on,
the declaration of the result of the show of hands, a poll is duly demanded. Subject to the Law, a poll may be demanded:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) by the chairman of the meeting;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) by at least two Members having the right to vote on the resolutions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) by any Member or Members present who, individually or collectively, hold at least ten per cent of the voting rights of all those who
have a right to vote on the resolution.

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**Outcome of vote by show of hands**

11.11 Unless a poll is duly demanded, a declaration by the chairman as to the result of a resolution and an
entry to that effect in the minutes of the meeting shall be conclusive evidence of the outcome of a show of hands without proof of the
number or proportion of the votes recorded in favour of or against the resolution.

**Withdrawal of demand for a poll**

11.12 The demand for a poll may be withdrawn before the poll is taken, but only with the consent of the chairman.
The chairman shall announce any such withdrawal to the meeting and, unless another person forthwith demands a poll, any earlier show of
hands on that resolution shall be treated as the vote on that resolution; if there has been no earlier show of hands, then the resolution
shall be put to the vote of the meeting.

**Taking of a poll**

11.13 A poll demanded on the question of adjournment shall be taken
immediately.

11.14 A poll demanded on any other question shall be taken either immediately or at an adjourned meeting at
such time and place as the chairman directs, not being more than thirty Clear Days after the poll was demanded.

11.15 The demand for a poll shall not prevent the meeting continuing to transact any business other than the
question on which the poll was demanded.

11.16 A poll shall be taken in such manner as the chairman directs. He may appoint scrutineers (who need not
be Members) and fix a place and time for declaring the result of the poll. If, through the aid of technology, the meeting is held in more
than place, the chairman may appoint scrutineers in more than place; but if he considers that the poll cannot be effectively monitored
at that meeting, the chairman shall adjourn the holding of the poll to a date, place and time when that can occur.

**Chairman's casting vote**

11.17 In the case of an equality of votes, whether on a show of hands or on a poll, the Chairman of the meeting
at which the show of hands takes place or at which the poll is demanded shall not be entitled to a second or casting vote.

**Written resolutions**

11.18 Members may pass a resolution in writing without holding a meeting if the following conditions are met:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all Members entitled to vote are given notice of the resolution as if the same were being proposed at a meeting of Members;

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) all Members entitled so to vote;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) sign a document; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) sign several documents in the like form each signed by one or more of those Members; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the signed document or documents is or are delivered to the Company, including, if the Company so nominates,
by delivery of an Electronic Record by Electronic means to the address specified for that purpose.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Such written resolution shall be as effective as if it had been passed at a meeting of the Members entitled to vote duly convened
and held.

11.19 If a written resolution is described as a Special Resolution or as an Ordinary Resolution, it has effect
accordingly.

11.20 The Directors may determine the manner in which written resolutions shall be put to Members. In particular,
they may provide, in the form of any written resolution, for each Member to indicate, out of the number of votes the Member would have
been entitled to cast at a meeting to consider the resolution, how many votes he wishes to cast in favour of the resolution and how many
against the resolution or to be treated as abstentions. The result of any such written resolution shall be determined on the same basis
as on a poll.

**Sole-Member Company**

11.21 If the Company has only one Member, and the Member records in writing his decision on a question, that
record shall constitute both the passing of a resolution and the minute of it.

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| **12** | **Voting rights of Members** |

---

**Right to vote**

12.1 Unless their Shares carry no right to vote, or unless a call or other amount
presently payable has not been paid, all Members are entitled to vote at a general meeting, whether on a show of hands or on a poll, and
all Members holding Shares of a particular class of Shares are entitled to vote at a meeting of the holders of that class of Shares.

12.2 Members may vote in person or by proxy.

12.3 On a show of hands, every Member shall have one vote. For the avoidance
of doubt, an individual who represents two or more Members, including a Member in that individual's own right, that individual shall
be entitled to a separate vote for each Member.

12.4 On a poll a Member shall have one vote for each Share he holds, unless any
Share carries special voting rights.

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12.5 No Member is bound to vote on his Shares or any of them; nor is he bound
to vote each of his Shares in the same way.

**Rights of joint holders**

12.6 If Shares are held jointly, only one of the joint holders may vote. If more
than one of the joint holders tenders a vote, the vote of the holder whose name in respect of those Shares appears first in the register
of Members shall be accepted to the exclusion of the votes of the other joint holder.

**Representation of corporate Members**

12.7 Save where otherwise provided, a corporate Member must act by a duly authorised
representative.

12.8 A corporate Member wishing to act by a duly authorised representative must
identify that person to the Company by notice in writing.

12.9 The authorisation may be for any period of time, and must be delivered to
the Company before the commencement of the meeting at which it is first used.

12.10 The Directors of the Company may require the production of any evidence which they consider necessary
to determine the validity of the notice.

12.11 Where a duly authorised representative is present at a meeting that Member is deemed to be present in
person; and the acts of the duly authorised representative are personal acts of that Member.

12.12 A corporate Member may revoke the appointment of a duly authorised representative at any time by notice
to the Company; but such revocation will not affect the validity of any acts carried out by the duly authorised representative before
the Directors of the Company had actual notice of the revocation.

**Member with mental disorder**

12.13 A Member in respect of whom an order has been made by any court having jurisdiction (whether in the Cayman
Islands or elsewhere) in matters concerning mental disorder may vote, whether on a show of hands or on a poll, by that Member's
receiver, *curator bonis* or other person authorised in that behalf appointed by that court.

12.14 For the purpose of the preceding Article, evidence to the satisfaction of the Directors of the authority
of the person claiming to exercise the right to vote must be received not less than 24 hours before holding the relevant meeting or the
adjourned meeting in any manner specified for the delivery of forms of appointment of a proxy, whether in writing or by Electronic means.
In default, the right to vote shall not be exercisable.

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**Objections to admissibility of votes**

12.15 An objection to the validity of a person's vote may only be raised at the meeting or at the adjourned
meeting at which the vote is sought to be tendered. Any objection duly made shall be referred to the chairman whose decision shall be
final and conclusive.

**Form of proxy**

12.16 An instrument appointing a proxy shall be in any common form or in any other form approved by the Directors.

12.17 The instrument must be in writing and signed in one of the following
ways:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) by the Member; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) by the Member's authorised attorney; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) if the Member is a corporation or other body corporate, under seal or signed by an authorised officer, secretary or attorney.

If the Directors so resolve, the Company may accept an Electronic Record of that instrument delivered in the manner specified below and otherwise satisfying the Articles about authentication of Electronic Records.

12.18 The Directors may require the production of any evidence which they consider necessary to determine the
validity of any appointment of a proxy.

12.19 A Member may revoke the appointment of a proxy at any time by notice to the Company duly signed in accordance
with Article 12.17.

12.20 No revocation by a Member of the appointment of a proxy made in accordance with Article 12.19
will affect the validity of any acts carried out by the relevant proxy before the Directors of the Company had actual notice of the
revocation.

**How and when proxy is to be delivered**

12.21 Subject to the following Articles, the Directors may, in the notice convening any meeting or
 adjourned meeting, or in an instrument of proxy sent out by the Company, specify the manner by which the instrument appointing a
 proxy shall be deposited and the place and the time (being not later than the time appointed for the commencement of the meeting or
 adjourned meeting to which the proxy relates) at which the instrument appointing a proxy shall be deposited. In the absence of any
 such direction from the Directors in the notice convening any meeting or adjourned meeting or in an instrument of proxy sent out by
 the Company, the form of appointment of a proxy and any authority under which it is signed (or a copy of the authority certified
 notarially or in any other way approved by the Directors) must be delivered so that it is received by the Company before the time
 for holding the meeting or adjourned meeting at which the person named in the form of appointment
of proxy proposes to vote.

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They must be delivered in either of the following ways:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) In the case of an instrument in writing, it must be left at or sent by post:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) to the registered office of the Company; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) to such other place within the Cayman Islands specified in the notice convening the meeting or in any
form of appointment of proxy sent out by the Company in relation to the meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If, pursuant to the notice provisions, a notice may be given to the Company in an Electronic Record, an
Electronic Record of an appointment of a proxy must be sent to the address specified pursuant to those provisions unless another address
for that purpose is specified:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) in the notice convening the meeting; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) in any form of appointment of a proxy sent out by the Company in relation to the meeting; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) in any invitation to appoint a proxy issued by the Company in relation to the meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding Article 12.21(a) and Article 12.21(b), the
chairman of the Company may, in any event at his discretion, direct that an instrument of proxy shall be deemed to have been duly deposited.

12.22 Where a poll is taken:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) if it is taken more than seven Clear Days after it is demanded, the form of appointment of a proxy and
any accompanying authority (or an Electronic Record of the same) must be delivered in accordance with Article 12.21
before the time appointed for the taking of the poll;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if it to be taken within seven Clear Days after it was demanded, the form of appointment of a proxy and
any accompanying authority (or an Electronic Record of the same) must be delivered in accordance with Article 12.21
before the time appointed for the taking of the poll.

12.23 If the form of appointment of proxy is not delivered on time,
it is invalid.

12.24 When two or more valid but differing appointments of proxy are delivered or received in respect of
 the same Share for use at the same meeting and in respect of the same matter, the one which is last validly delivered or received
 (regardless of its date or of the date of its execution) shall be treated as replacing and revoking the other or others as regards
 that Share. lf the Company is unable to determine which appointment
was last validly delivered or received, none of them shall be treated as valid in respect of that Share.

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12.25 The Board may at the expense of the Company send forms of appointment of proxy to the Members by post
(that is to say, pre-paying and posting a letter), or by Electronic communication or otherwise (with or without provision for their return
by pre-paid post) for use at any general meeting or at any separate meeting of the holders of any class of Shares, either blank or nominating
as proxy in the alternative any one or more of the Directors or any other person. lf for the purpose of any meeting invitations to appoint
as proxy a person or one of a number of persons specified in the invitations are issued at the Company's expense, they shall be
issued to all (and not to some only) of the Members entitled to be sent notice of the meeting and to vote at it. The accidental omission
to send such a form of appointment or to give such an invitation to, or the non-receipt of such form of appointment by, any Member entitled
to attend and vote at a meeting shall not invalidate the proceedings at that meeting

**Voting by proxy**

12.26 A proxy shall have the same voting rights at a meeting or adjourned meeting as the Member would have had
except to the extent that the instrument appointing him limits those rights. Notwithstanding the appointment of a proxy, a Member may
attend and vote at a meeting or adjourned meeting. If a Member votes on any resolution a vote by his proxy on the same resolution, unless
in respect of different Shares, shall be invalid.

12.27 The instrument appointing a proxy to vote at a meeting shall be deemed also to confer authority to demand
or join in demanding a poll and, for the purposes of Article 11.11, a demand by a person as proxy for a Member shall
be the same as a demand by a Member. Such appointment shall not confer any further right to speak at the meeting, except with the permission
of the chairman of the meeting.

**13** **Number of Directors**

13.1 There shall be a Board consisting of not less than one person provided however
that the Company may by Ordinary Resolution increase or reduce the limits in the number of Directors. Unless fixed by Ordinary Resolution,
the maximum number of Directors shall be unlimited.

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| **14** | **Appointment, disqualification and removal of Directors** |

---

**First Directors**

14.1 The first Directors shall be appointed in writing by the subscriber or subscribers to the Memorandum,
or a majority of them.

**No age limit**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2 There is no age limit for Directors
save that they must be at least eighteen years of age.

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**Corporate Directors**

14.3 Unless prohibited by law, a body corporate may be a Director. If a body
corporate is a Director, the Articles about representation of corporate Members at general meetings apply, mutatis mutandis, to the Articles
about Directors' meetings.

**No shareholding qualification**

14.4 Unless a shareholding qualification for Directors is fixed by Ordinary Resolution,
no Director shall be required to own Shares as a condition of his appointment.

**Appointment of Directors**

14.5 A Director may be appointed by Ordinary Resolution or by the Directors.
Any appointment may be to fill a vacancy or as an additional Director.

14.6 A remaining Director may appoint
a Director even though there is not a quorum of Directors.

14.7 No appointment can cause the number of Directors to exceed the maximum (if
one is set); and any such appointment shall be invalid.

14.8 For so long as Shares are listed on a Designated Stock Exchange, the Directors
shall include at least such number of Independent Directors as applicable law, rules or regulations or the Designated Stock Exchange Rules
require as determined by the Board.

**Board's power to appoint Directors**

14.9 Without prejudice to the Company's power to appoint a person to be
a Director pursuant to these Articles, the Board shall have power at any time to appoint any person who is willing to act as a Director,
either to fill a vacancy or as an addition to the existing Board, subject to the total number of Directors not exceeding any maximum number
fixed by or in accordance with these Articles.

14.10 Any Director so appointed shall, if still a Director, retire at the next annual general meeting after
his appointment and be eligible to stand for election as a Director at such meeting.

**Eligibility**

14.11 No person (other than a Director retiring in accordance with these Articles) shall be appointed or re-appointed
a Director at any general meeting unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) he is recommended by the Board; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) not less than seven nor more than forty-two Clear Days before the date appointed for the meeting, a Member
(other than the person to be proposed) entitled to vote at the meeting has given to the Company notice of his intention to propose a resolution
for the appointment of that person, stating the particulars which would, if he were so appointed, be required to be included in the Company's
register of Directors and a notice executed by that person of his willingness to be appointed.

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**Appointment at annual general meeting**

14.12 Unless re-appointed pursuant to the provisions of Article 14.5 or removed from office
pursuant to the provisions of Article 14.13, each Director shall be appointed for a term expiring at the next-following
annual general meeting of the Company. At any such annual general meeting, Directors will be elected by Ordinary Resolution. At each annual
general meeting of the Company, each Director elected at such meeting shall be elected to hold office for a one-year term and until the
election of their respective successors in office or removal pursuant to Articles 14.5 and 14.13.

**Removal of Directors**

14.13 A Director may be removed by Ordinary Resolution.

**Resignation of Directors**

14.14 A Director may at any time resign office by giving to the Company notice in writing or, if permitted pursuant
to the notice provisions, in an Electronic Record delivered in either case in accordance with those provisions.

14.15 Unless the notice specifies a different date, the Director shall be deemed to have resigned on the date
that the notice is delivered to the Company.

**Termination of the office of Director**

14.16 A Director may retire from office as a Director by giving notice in writing to that effect to the Company
at the registered office, which notice shall be effective upon such date as may be specified in the notice, failing which upon delivery
to the registered office.

14.17 Without prejudice to the provisions in these Articles for retirement
(by rotation or otherwise), a Director's office shall be terminated forthwith if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) he is prohibited by the law of the Cayman Islands from acting as a Director; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) he is made bankrupt or makes an arrangement or composition with his creditors generally; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) he resigns his office by notice to the Company; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) he only held office as a Director for a fixed term and such term expires; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) in the opinion of a registered medical practitioner by whom he is being treated he becomes physically or mentally incapable of acting
as a Director; or

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) he is given notice by the majority of the other Directors (not being less than two in number) to vacate
office (without prejudice to any claim for damages for breach of any agreement relating to the provision of the services of such Director);
or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) he is made subject to any law relating to mental health or incompetence, whether by court order or otherwise; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) without the consent of the other Directors, he is absent from meetings of Directors for a continuous period of six months.

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| **15** | **Alternate Directors** |

---

**Appointment and removal**

15.1 Any Director may appoint any other person, including another Director, to
act in his place as an alternate Director. No appointment shall take effect until the Director has given notice of the appointment to
the Board.

15.2 A Director may revoke his appointment of an alternate at any time. No revocation
shall take effect until the Director has given notice of the revocation to the Board.

15.3 A notice of appointment or removal of an alternate Director shall be effective
only if given to the Company by one or more of the following methods:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) by notice in writing in accordance with the notice provisions contained in these Articles;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if the Company has a facsimile address for the time being, by sending by facsimile transmission to that
facsimile address a facsimile copy or, otherwise, by sending by facsimile transmission to the facsimile address of the Company's registered
office a facsimile copy (in either case, the facsimile copy being deemed to be the notice unless Article 29.7 applies),
in which event notice shall be taken to be given on the date of an error-free transmission report from the sender's fax machine;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) if the Company has an email address for the time being, by emailing to that email address a scanned copy
of the notice as a PDF attachment or, otherwise, by emailing to the email address provided by the Company's registered office a scanned
copy of the notice as a PDF attachment (in either case, the PDF version being deemed to be the notice unless Article 29.7
applies), in which event notice shall be taken to be given on the date of receipt by the Company or the Company's registered office
(as appropriate) in readable form; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) if permitted pursuant to the notice provisions, in some other form of approved Electronic Record delivered in accordance with those
provisions in writing.

**Notices**

15.4 All notices of meetings of Directors shall continue to be given to the appointing
Director and not to the alternate.

**Rights of alternate Director**

15.5 An alternate Director shall be entitled to attend and vote at any Board
meeting or meeting of a committee of the Directors at which the appointing Director is not personally present, and generally to perform
all the functions of the appointing Director in his absence. An alternate Director, however, is not entitled to receive any remuneration
from the Company for services rendered as an alternate Director.

**Appointment ceases when the appointor ceases to be a Director**

15.6 An alternate Director shall cease
to be an alternate Director if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Director who appointed him ceases to be a Director; or

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Director who appointed him revokes his appointment by notice delivered to the Board or to the registered
office of the Company or in any other manner approved by the Board; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) in any event happens in relation to him which, if he were a Director of the Company, would cause his office as Director to be vacated.

**Status of alternate Director**

15.7 An alternate Director shall carry
out all functions of the Director who made the appointment.

15.8 Save where otherwise expressed, an alternate Director shall be treated as a Director under these Articles.

15.9 An alternate Director is not the agent of the Director appointing
him.

15.10 An alternate Director is not entitled to any remuneration for
acting as alternate Director.

**Status of the Director making the appointment**

15.11 A Director who has appointed an alternate is not thereby relieved from the duties which he owes the Company.

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| **16** | **Powers of Directors** |

---

**Powers of Directors**

16.1 Subject to the provisions of the Law, the Memorandum and these Articles
the business of the Company shall be managed by the Directors who may for that purpose exercise all the powers of the Company.

16.2 No prior act of the Directors shall be invalidated by any subsequent alteration
of the Memorandum or these Articles. However, to the extent allowed by the Law, Members may, by Special Resolution, validate any prior
or future act of the Directors which would otherwise be in breach of their duties.

**Directors below the minimum number**

16.3 lf the number of Directors is less than the minimum prescribed in accordance
with these Articles, the remaining Director or Directors shall act only for the purposes of appointing an additional Director or Directors
to make up such minimum or of convening a general meeting of the Company for the purpose of making such appointment. lf there are no Director
or Directors able or willing to act, any two Members may summon a general meeting for the purpose of appointing Directors. Any additional
Director so appointed shall hold office (subject to these Articles) only until the dissolution of the annual general meeting next following
such appointment unless he is re-elected during such meeting.

**Appointments to office**

16.4 The Directors may appoint a Director:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) as chairman of the Board;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) as managing Director;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) to any other executive office,

for such period, and on such terms, including as to remuneration as they think fit.

16.5 The appointee must consent in
writing to holding that office.

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16.6 Where a chairman is appointed he shall, unless unable to do so, preside
at every meeting of Directors.

16.7 If there is no chairman, or if the chairman is unable to preside at a meeting,
that meeting may select its own chairman; or the Directors may nominate one of their number to act in place of the chairman should he
ever not be available.

16.8 Subject to the provisions of the Law, the Directors may also appoint and
remove any person, who need not be a Director:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) as Secretary; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to any office that may be required

for such period and on such terms, including as to remuneration, as they think fit. In the case of an Officer, that Officer may be given any title the Directors decide.

16.9 The Secretary or Officer must
consent in writing to holding that office.

16.10 A Director, Secretary or other Officer of the Company may not the hold the office, or perform the services,
of auditor.

**Provisions for employees**

16.11 The Board may make provision for the benefit of any persons employed or formerly employed by the Company
or any of its subsidiary undertakings (or any member of his family or any person who is dependent on him) in connection with the cessation
or the transfer to any person of the whole or part of the undertaking of the Company or any of its subsidiary undertakings.

**Exercise of voting rights**

16.12 The Board may exercise the voting power conferred by the Shares in any body corporate held or owned by
the Company in such manner in all respects as it thinks fit (including, without limitation, the exercise of that power in favour of any
resolution appointing any Director as a Director of such body corporate, or voting or providing for the payment of remuneration to the
Directors of such body corporate).

**Remuneration**

16.13 Every Director may be remunerated by the Company for the services he provides for the benefit of the Company,
whether as Director, employee or otherwise, and shall be entitled to be paid for the expenses incurred in the Company's business
including attendance at Directors' meetings.

16.14 Until otherwise determined by the Company by Ordinary Resolution, the Directors (other than alternate
Directors) shall be entitled to such remuneration by way of fees for their services in the office of Director as the Directors may determine.

16.15 Remuneration may take any form and may include arrangements to pay pensions, health insurance, death or
sickness benefits, whether to the Director or to any other person connected to or related to him.

16.16 Unless his fellow Directors determine otherwise, a Director is not accountable to the Company for remuneration
or other benefits received from any other company which is in the same group as the Company or which has common shareholdings.

---

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**Disclosure of information**

16.17 The Directors may release or disclose to a third party any information regarding the affairs of the Company,
including any information contained in the register of Members relating to a Member, (and they may authorise any Director, Officer or
other authorised agent of the Company to release or disclose to a third party any such information in his possession) if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Company or that person, as the case may be, is lawfully required to do so under the laws of any jurisdiction to which the Company
is subject; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) such disclosure is in compliance with the Designated Stock Exchange Rules; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) such disclosure is in accordance with any contract entered into by the Company; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the Directors are of the opinion such disclosure would assist or facilitate the Company's operations.

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| **17** | **Delegation of powers** |

---

**Power to delegate any of the Directors' powers to a committee**

17.1 The Directors may delegate any of their powers to any committee consisting
of one or more persons who need not be Members. Persons on the committee may include non-Directors so long as the majority of those persons
are Directors. Any such committee shall be made up of such number of Independent Directors as required from time to time by the Designated
Stock Exchange Rules or otherwise required by applicable law.

17.2 The delegation may be collateral
with, or to the exclusion of, the Directors' own powers.

17.3 The delegation may be on such terms as the Directors think fit, including
provision for the committee itself to delegate to a sub-committee; save that any delegation must be capable of being revoked or altered
by the Directors at will.

17.4 Unless otherwise permitted by the Directors, a committee must follow the
procedures prescribed for the taking of decisions by Directors.

17.5 The Board shall establish an audit committee, a compensation committee and
a nominating and corporate governance committee. Each of these committees shall be empowered to do all things necessary to exercise the
rights of such committee set forth in these Articles. Each of the audit committee, compensation committee and nominating and corporate
governance committee shall consist of at least three Directors (or such larger minimum number as may be required from time to time by
the Designated Stock Exchange Rules). The majority of the committee members on each of the compensation committee and nominating and corporate
governance committee shall be Independent Directors. The audit committee shall be made up of such number of Independent Directors as required
from time to time by the Designated Stock Exchange Rules or otherwise required by applicable law.

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**Local boards**

17.6 The Board may establish any local or divisional board or agency for managing
any of the affairs of the Company whether in the Cayman Islands or elsewhere and may appoint any persons to be members of a local or divisional
Board, or to be managers or agents, and may fix their remuneration.

17.7 The Board may delegate to any local or divisional board, manager or agent
any of its powers and authorities (with power to sub-delegate) and may authorise the members of any local or divisional board or any of
them to fill any vacancies and to act notwithstanding vacancies.

17.8 Any appointment or delegation under this Article 17.8 may be made on such terms and subject to such conditions as the Board thinks fit and the Board
may remove any person so appointed, and may revoke or vary any delegation.

**Power to appoint an agent of the Company**

17.9 The Directors may appoint any person, either generally or in respect of
any specific matter, to be the agent of the Company with or without authority for that person to delegate all or any of that person's
powers. The Directors may make that appointment:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) by causing the Company to enter into a power of attorney or agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) in any other manner they determine.

**Power to appoint an attorney or authorised signatory of the Company**

17.10 The Directors may appoint any person, whether nominated directly or indirectly by the Directors, to be
the attorney or the authorised signatory of the Company. The appointment may be:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) for any purpose;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) with the powers, authorities and discretions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) for the period; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) subject to such conditions

as they think fit. The powers, authorities and discretions, however, must not exceed those vested in, or exercisable, by the Directors under these Articles. The Directors may do so by power of attorney or any other manner they think fit.

17.11 Any power of attorney or other appointment may contain such provision for the protection and convenience
for persons dealing with the attorney or authorised signatory as the Directors think fit. Any power of attorney or other appointment may
also authorise the attorney or authorised signatory to delegate all or any of the powers,
authorities and discretions vested in that person.

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17.12 The Board may remove any person appointed under Article 17.10 and may revoke or
vary the delegation.

**Borrowing Powers**

17.13 The Directors may exercise all the powers of the Company to borrow money and to mortgage or charge its
undertaking, property and assets both present and future and uncalled capital, or any part thereof, and to issue debentures and other
securities, whether outright or as collateral security for any debt, liability or obligation of the Company or its parent undertaking
(if any) or any subsidiary undertaking of the Company or of any third party.

**Corporate Governance**

17.14 The Board may, from time to time, and except as required by applicable law or the Designated Stock Exchange
Rules, adopt, institute, amend, modify or revoke the corporate governance policies or initiatives of the Company, which shall be intended
to set forth the guiding principles and policies of the Company and the Board on various corporate governance related matters as the Board
shall determine by resolution from time to time.

---

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| **18** | **Meetings of Directors** |

---

**Regulation of Directors' meetings**

18.1 Subject to the provisions of these Articles, the Directors may regulate
their proceedings as they think fit.

**Calling meetings**

18.2 Any Director may call a meeting of Directors at any time. The Secretary
must call a meeting of the Directors if requested to do so by a Director.

**Notice of meetings**

18.3 Notice of a Board meeting may be given to a Director personally or by word
of mouth or given in writing or by Electronic communications at such address as he may from time to time specify for this purpose (or,
if he does not specify an address, at his last known address). A Director may waive his right to receive notice of any meeting either
prospectively or retrospectively.

**Use of technology**

18.4 A Director may participate in a meeting of Directors through the medium
of conference telephone, video or any other form of communications equipment providing all persons participating in the meeting are able
to hear and speak to each other throughout the meeting.

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18.5 A Director participating in this
way is deemed to be present in person at the meeting.

**Quorum**

18.6 The quorum for the transaction of business at a meeting of Directors shall
be two unless the Directors fix some other number.

**Chairman or deputy to preside**

18.7 The Board may appoint a chairman and one or more deputy chairman or chairmen
and may at any time revoke any such appointment.

18.8 The chairman, or failing him any deputy chairman (the longest in office
taking precedence if more than one is present), shall preside at all Board meetings. If no chairman or deputy chairman has been appointed,
or if he is not present within five minutes after the time fixed for holding the meeting, or is unwilling to act as chairman of the meeting,
the Directors present shall choose one of their number to act as chairman of the meeting.

**Voting**

18.9 A question which arises at a Board meeting shall be decided by a majority
of votes. If votes are equal the chairman may, if he wishes, exercise a casting vote.

**Recording of dissent**

18.10 A Director present at a meeting of Directors shall be presumed to have assented to any action taken at
that meeting unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) his dissent is entered in the minutes of the meeting; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) he has filed with the meeting before it is concluded signed dissent from that action; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) he has forwarded to the Company as soon as practical following the conclusion of that meeting signed dissent.

A Director who votes in favour of an action is not entitled to record his dissent to it.

**Written resolutions**

18.11 The Directors may pass a resolution in writing without holding a meeting if all Directors sign a document
or sign several documents in the like form each signed by one or more of those Directors.

18.12 A written resolution signed by a validly appointed alternate Director need not also be signed by the appointing
Director.

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18.13 A written resolution signed personally by the appointing Director need not also be signed by his alternate.

18.14 A resolution in writing passed pursuant to Article 18.11, Article 18.12
and/or Article 18.13 shall be as effective as if it had been passed at a meeting of the Directors duly convened
and held; and it shall be treated as having been passed on the day and at the time that the last Director signs (and for the avoidance
of doubt, such day may or may not be a Business Day).

**Validity of acts of Directors in spite of formal defect**

18.15 All acts done by a meeting of the Board, or of a committee of the Board, or by any person acting as a
Director or an alternate Director, shall, notwithstanding that it is afterwards discovered that there was some defect in the appointment
of any Director or alternate Director or member of the committee, or that any of them were disqualified or had vacated office or were
not entitled to vote, be as valid as if every such person had been duly appointed and qualified and had continued to be a Director or
alternate Director and had been entitled to vote.

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| **19** | **Permissible Directors' interests and disclosure** |

---

19.1 A Director shall not, as a Director, vote in respect of any contract, transaction,
arrangement or proposal in which he has an interest which (together with any interest of any person connected with him) is a material
interest (otherwise then by virtue of his interests, direct or indirect, in Shares or debentures or other securities of, or otherwise
in or through, the Company) and if he shall do so his vote shall not be counted, nor in relation thereto shall he be counted in the quorum
present at the meeting, but (in the absence of some other material interest than is mentioned below) none of these prohibitions shall
apply to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the giving of any security, guarantee or indemnity in respect of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) money lent or obligations incurred by him or by any other person for the benefit of the Company or any of its subsidiaries; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a debt or obligation of the Company or any of its subsidiaries for which the Director himself has assumed
responsibility in whole or in part and whether alone or jointly with others under a guarantee or indemnity or by the giving of security;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) where the Company or any of its subsidiaries is offering securities in which offer the Director is or
may be entitled to participate as a holder of securities or in the underwriting or sub-underwriting of which the Director is to or may
participate;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) any contract, transaction, arrangement or proposal affecting any other body corporate in which he is interested,
directly or indirectly and whether as an officer, shareholder, creditor or otherwise howsoever, provided that he (together with persons
connected with him) does not to his knowledge hold an interest representing one per cent or more of any class of the equity share
capital of such body corporate (or of any third body corporate through which his interest is derived) or of the voting rights available
to members of the relevant body corporate (any such interest being deemed for the purposes of this Article 19.1 to
be a material interest in all circumstances);

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any act or thing done or to be done in respect of any arrangement for the benefit of the employees of
the Company or any of its subsidiaries under which he is not accorded as a Director any privilege or advantage not generally accorded
to the employees to whom such arrangement relates; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any matter connected with the purchase or maintenance for any Director of insurance against any liability
or (to the extent permitted by the Law) indemnities in favour of Directors, the funding of expenditure by one or more Directors in defending
proceedings against him or them or the doing of any thing to enable such Director or Directors to avoid incurring such expenditure.

19.2 A Director may, as a Director, vote (and be counted in the quorum) in respect
of any contract, transaction, arrangement or proposal in which he has an interest which is not a material interest or which falls within
Article 19.1.

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| **20** | **Minutes** |

---

20.1 The Company shall cause minutes to be made in books of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all appointments of Officers and committees made by the Board and of any such Officer's remuneration; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the names of Directors present at every meeting of the Directors, a committee of the Board, the Company
or the holders of any class of shares or debentures, and all orders, resolutions and proceedings of such meetings.

20.2 Any such minutes, if purporting to be signed by the chairman of the meeting
at which the proceedings were held or by the chairman of the next succeeding meeting or the Secretary, shall be prima facie evidence of
the matters stated in them.

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| **21** | **Accounts and audit** |

---

21.1 The Directors must ensure that proper accounting and other records are kept,
and that accounts and associated reports are distributed in accordance with the requirements of the Law.

21.2 The books of account shall be kept at the registered office of the Company
and shall always be open to inspection by the Directors. No Member (other than a Director) shall have any right of inspecting any account
or book or document of the Company except as conferred by the Law or as authorised by the Directors or by Ordinary Resolution.

---

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21.3 Unless the Directors otherwise prescribe, the financial year of the Company
shall end on 30 June in each year and begin on 1 July in each year.

**Auditors**

21.4 The Directors may appoint an Auditor of the Company who shall hold office
on such terms as the Directors determine.

21.5 At any general meeting convened and held at any time in accordance with
these Articles, the Members may, by Ordinary Resolution, remove the Auditor before the expiration of his term of office. If they do so,
the Members shall, by Ordinary Resolution, at that meeting appoint another Auditor in his stead for the remainder of his term.

21.6 The Auditors shall examine such books, accounts and vouchers; as may be
necessary for the performance of their duties.

21.7 The Auditors shall, if so requested by the Directors, make a report on the
accounts of the Company during their tenure of office at the next annual general meeting following their appointment, and at any time
during their term of office, upon request of the Directors or any general meeting of the Company.

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| **22** | **Record dates** |

---

22.1 Except to the extent of any conflicting rights attached to Shares, the resolution
declaring a dividend on Shares of any class, whether it be an Ordinary Resolution of the Members or a Director's resolution, may
specify that the dividend is payable or distributable to the persons registered as the holders of those Shares at the close of business
on a particular date, notwithstanding that the date may be a date prior to that on which the resolution is passed.

22.2 If the resolution does so specify, the dividend shall be payable or distributable
to the persons registered as the holders of those Shares at the close of business on the specified date in accordance with their respective
holdings so registered, but without prejudice to the rights *inter se* in respect of the dividend of transferors and transferees
of any of those Shares.

22.3 The provisions of this Article apply, *mutatis mutandis*, to bonuses,
capitalisation issues, distributions of realised capital profits or offers or grants made by the Company to the Members.

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| **23** | **Dividends** |

---

**Source of dividends**

23.1 Dividends may be declared and paid out of any funds of the Company lawfully available for distribution.

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23.2 Subject to the requirements of the Law regarding the application of a company's
Share premium account and with the sanction of an Ordinary Resolution, dividends may also be declared and paid out of any share premium
account.

**Declaration of dividends by Members**

23.3 Subject to the provisions of the Law, the Company may by Ordinary Resolution
declare dividends in accordance with the respective rights of the Members but no dividend shall exceed the amount recommended by the Directors.

**Payment of interim dividends and declaration of final dividends by Directors**

23.4 The Directors may declare and pay interim dividends or recommend final dividends
in accordance with the respective rights of the Members if it appears to them that they are justified by the financial position of the
Company and that such dividends may lawfully be paid.

23.5 Subject to the provisions of the Law, in relation to the distinction between
interim dividends and final dividends, the following applies:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Upon determination to pay a dividend or dividends described as interim by the Directors in the dividend

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Upon declaration of a dividend or dividends described as final by the Directors in the dividend resolution,
a debt shall be created immediately following the declaration, the due date to be the date the dividend is stated to be payable in the
resolution.

If the resolution fails to specify whether a dividend is final or interim, it shall be assumed to be interim.

23.6 In relation to Shares carrying differing rights to dividends or rights to dividends at a fixed rate,
the following applies:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If the share capital is divided into different classes, the Directors may pay dividends on Shares which
confer deferred or non-preferred rights with regard to dividends as well as on Shares which confer preferential rights with regard to
dividends but no dividend shall be paid on Shares carrying deferred or non-preferred rights if, at the time of payment, any preferential
dividend is in arrears.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Directors may also pay, at intervals settled by them, any dividend payable at a fixed rate if it appears
to them that there are sufficient funds of the Company lawfully available for distribution to justify the payment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If the Directors act in good faith, they shall not incur any liability to the Members holding Shares conferring
preferred rights for any loss those Members may suffer by the lawful payment of the dividend on any Shares having deferred
or non-preferred rights.

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**Apportionment of dividends**

23.7 Except as otherwise provided by the rights attached to Shares all dividends
shall be declared and paid according to the amounts Paid Up on the Shares on which the dividend is paid. All dividends shall be apportioned
and paid proportionately to the amount Paid Up on the Shares during the time or part of the time in respect of which the dividend is paid.
But if a Share is issued on terms providing that it shall rank for dividend as from a particular date, that Share shall rank for dividend
accordingly.

**Right of set off**

23.8 The Directors may deduct from a dividend or any other amount payable to
a person in respect of a Share any amount due by that person to the Company on a call or otherwise in relation to a Share.

**Power to pay other than in cash**

23.9 If the Directors so determine, any resolution declaring a dividend may direct
that it shall be satisfied wholly or partly by the distribution of assets. If a difficulty arises in relation to the distribution, the
Directors may settle that difficulty in any way they consider appropriate. For example, they may do any one or more of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) issue fractional Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) fix the value of assets for distribution and make cash payments to some Members on the footing of the value so fixed in order to adjust
the rights of Members; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) vest some assets in trustees.

**How payments may be made**

23.10 A dividend or other monies payable on or in respect of a Share may be paid in any of the following ways:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) if the Member holding that Share or other person entitled to that Share nominates a bank account for that purpose - by wire transfer
to that bank account; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) by cheque or warrant sent by post to the registered address of the Member holding that Share or other person entitled to that Share.

23.11 For the purposes of Article 23.10(a), the nomination may be in writing or in an
Electronic Record and the bank account nominated may be the bank account of another person. For the purposes of Article 23.10(b),
subject to any applicable law or regulation, the cheque or warrant shall be made to the order of the Member holding that Share or
other person entitled to the Share or to his nominee, whether nominated in writing
or in an Electronic Record, and payment of the cheque or warrant shall be a good discharge to the Company.

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23.12 If two or more persons are registered as the holders of the Share or are jointly entitled to it by reason
of the death or bankruptcy of the registered holder (**Joint Holders**), a dividend (or other amount) payable on or in respect of that
Share may be paid as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to the registered address of the Joint Holder of the Share who is named first on the register of Members
or to the registered address of the deceased or bankrupt holder, as the case may be; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to the address or bank account of another person nominated by the Joint Holders, whether that nomination is in writing or in an Electronic
Record.

23.13 Any Joint Holder of a Share may give a valid receipt for a dividend (or other amount) payable in respect
of that Share.

**Dividends or other monies not to bear interest in absence of special rights**

23.14 Unless provided for by the rights attached to a Share, no dividend or other monies payable by the Company
in respect of a Share shall bear interest.

**Dividends unable to be paid or unclaimed**

23.15 If a dividend cannot be paid to a Member or remains unclaimed within six weeks after it was declared or
both, the Directors may pay it into a separate account in the Company's name. If a dividend is paid into a separate account, the
Company shall not be constituted trustee in respect of that account and the dividend shall remain a debt due to the Member.

23.16 A dividend that remains unclaimed for a period of six years after it became due for payment shall be forfeited
to, and shall cease to remain owing by, the Company.

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| **24** | **Capitalisation of profits** |

---

**Capitalisation of profits or of any share premium account or capital redemption reserve;**

24.1 The Directors may resolve to
capitalise:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any part of the Company's profits not required for
paying any preferential dividend (whether or not those profits are available for distribution); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any sum standing to the credit of the Company's share premium account or capital redemption reserve, if any.

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24.2 The amount resolved to be capitalised must be appropriated to the Members
who would have been entitled to it had it been distributed by way of dividend and in the same proportions. The benefit to each Member
so entitled must be given in either or both of the following ways:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) by paying up the amounts unpaid on that Member's Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) by issuing Fully Paid Up Shares, debentures or other securities of the Company to that Member or as that
Member directs. The Directors may resolve that any Shares issued to the Member in respect of Partly Paid Up Shares (**Original Shares**)
rank for dividend only to the extent that the Original Shares rank for dividend while those Original Shares remain Partly Paid Up.

**Applying an amount for the benefit of Members**

24.3 The amount capitalised must be applied to the benefit of Members in the
proportions to which the Members would have been entitled to dividends if the amount capitalised had been distributed as a dividend.

24.4 Subject to the Law, if a fraction of a Share, a debenture or other security
is allocated to a Member, the Directors may issue a fractional certificate to that Member or pay him the cash equivalent of the fraction.

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| **25** | **Share Premium Account** |

---

**Directors to maintain share premium account**

25.1 The Directors shall establish a share premium account in accordance with
the Law. They shall carry to the credit of that account from time to time an amount equal to the amount or value of the premium paid on
the issue of any Share or capital contributed or such other amounts required by the Law.

**Debits to share premium account**

25.2 The following amounts shall
be debited to any share premium account:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) on the redemption or purchase of a Share, the difference between the nominal value of that Share and the redemption or purchase price;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any other amount paid out of a share premium account as permitted by the Law.

25.3 Notwithstanding the preceding Article, on the redemption or purchase of
a Share, the Directors may pay the difference between the nominal value of that Share and the redemption purchase price out of the profits
of the Company or, as permitted by the Law, out of capital.

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| | |
|:---|:---|
| **26** | **Seal** |

---

**Company seal**

26.1 The Company may have a seal
if the Directors so determine.

---

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---

**Duplicate seal**

26.2 Subject to the provisions of the Law, the Company may also have a duplicate
seal or seals for use in any place or places outside the Cayman Islands. Each duplicate seal shall be a facsimile of the original seal
of the Company. However, if the Directors so determine, a duplicate seal shall have added on its face the name of the place where it is
to be used.

**When and how seal is to be used**

26.3 A seal may only be used by the authority of the Directors. Unless the Directors
otherwise determine, a document to which a seal is affixed must be signed in one of the following ways:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) by a Director (or his alternate) and the Secretary; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) by a single Director (or his alternate).

**If no seal is adopted or used**

26.4 If the Directors do not adopt a seal, or a seal is not used, a document may be executed in the following
manner:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) by a Director (or his alternate) and the Secretary; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) by a single Director (or his alternate); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) in any other manner permitted by the Law.

**Power to allow non-manual signatures and facsimile printing of seal**

26.5 The Directors may determine
that either or both of the following applies:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) that the seal or a duplicate seal need not be affixed manually but may be affixed by some other method or system of reproduction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) that a signature required by these Articles need not be manual but may be a mechanical or Electronic Signature.

**Validity of execution**

26.6 If a document is duly executed and delivered by or on behalf of the Company,
it shall not be regarded as invalid merely because, at the date of the delivery, the Secretary, or the Director, or other Officer or person
who signed the document or affixed the seal for and on behalf of the Company ceased to be the Secretary or hold that office and authority
on behalf of the Company.

---

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---

---

| | |
|:---|:---|
| **27** | **Indemnity** |

---

27.1 To the extent permitted by law, the Company shall indemnify each existing
or former Director (including alternate Director), Secretary and other Officer of the Company (including an investment adviser or an administrator
or liquidator) and their personal representatives against:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained
by the existing or former Director (including alternate Director), Secretary or Officer in or about the conduct of the Company's business
or affairs or in the execution or discharge of the existing or former Director's (including alternate Director's), Secretary's or
Officer's duties, powers, authorities or discretions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) without limitation to paragraph (a), all costs, expenses, losses or liabilities
incurred by the existing or former Director (including alternate Director), Secretary or Officer in defending (whether successfully or
otherwise) any civil, criminal, administrative or investigative proceedings (whether threatened, pending or completed) concerning the
Company or its affairs in any court or tribunal, whether in the Cayman Islands or elsewhere.

No such existing or former Director (including alternate Director), Secretary or Officer, however, shall be indemnified in respect of any matter arising out of his own dishonesty.

27.2 To the extent permitted by Law, the Company may make a payment, or agree
to make a payment, whether by way of advance, loan or otherwise, for any legal costs incurred by an existing or former Director (including
alternate Director), Secretary or Officer of the Company in respect of any matter identified in Article 27.1 on condition that the Director (including alternate Director), Secretary or Officer must repay
the amount paid by the Company to the extent that it is ultimately found not liable to indemnify the Director (including alternate Director),
Secretary or that Officer for those legal costs.

**Release**

27.3 To the extent permitted by Law, the Company may by Special Resolution release
any existing or former Director (including alternate Director), Secretary or other Officer of the Company from liability for any loss
or damage or right to compensation which may arise out of or in connection with the execution or discharge of the duties, powers, authorities
or discretions of his office; but there may be no release from liability arising out of or in connection with that person's own
dishonesty.

---

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---

**Insurance**

27.4 To the extent permitted by Law, the Company may pay, or agree to pay, a
premium in respect of a contract insuring each of the following persons against risks determined by the Directors, other than liability
arising out of that person's own dishonesty:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) an existing or former Director (including alternate Director), Secretary or Officer or auditor of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) a company which is or was a subsidiary of the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) a company in which the Company has or had an interest (whether direct or indirect); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) a trustee of an employee or retirement benefits scheme or other trust in which any of the persons referred to in paragraph (a)
is or was interested.

---

| | |
|:---|:---|
| **28** | **Notices** |

---

**Form of notices**

28.1 Save where these Articles provide otherwise, and subject to the Designated Stock Exchange Rules, any
notice to be given to or by any person pursuant to these Articles shall be:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) in writing signed by or on behalf of the giver in the manner set out below for written notices; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) subject to the next Article, in an Electronic Record signed by or on behalf of the giver by Electronic
Signature and authenticated in accordance with Articles about authentication of Electronic Records; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) where these Articles expressly permit, by the Company by means of a website.

**Electronic communications**

28.2 A notice may only be given to
the Company in an Electronic Record if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Directors so resolve;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the resolution states how an Electronic Record may be given and, if applicable, specifies an email address for the Company; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the terms of that resolution are notified to the Members for the time being and, if applicable, to those
Directors who were absent from the meeting at which the resolution was passed.

If the resolution is revoked or varied, the revocation or variation shall only become effective when its terms have been similarly notified.

28.3 A notice may not be given by Electronic Record to a person other than the Company unless the recipient
has notified the giver of an Electronic address to which notice may be sent.

 

---

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---

 

28.4 Subject to the Law, the Designated Stock Exchange Rules and to any other
rules which the Company is bound to follow, the Company may also send any notice or other document pursuant to these Articles to a Member
by publishing that notice or other document on a website where:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Company and the Member have agreed to his having access to the notice or document on a website (instead of it being sent to him);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the notice or document is one to which that agreement applies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Member is notified (in accordance with any requirements laid down by the Law and, in a manner for
the time being agreed between him and the Company for the purpose) of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the publication of the notice or document on a website;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the address of that website; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the place on that website where the notice or document may be accessed, and how it may be accessed; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the notice or document is published on that website throughout the publication period, provided that,
if the notice or document is published on that website for a part, but not all of, the publication period, the notice or document shall
be treated as being published throughout that period if the failure to publish that notice of document throughout that period is wholly
attributable to circumstances which it would not be reasonable to have expected the Company to prevent or avoid. For the purposes of this
Article 28.4 "publication period" means a period of not less than twenty-one days, beginning on the day
on which the notification referred to in Article 28.4(c) is deemed sent.

**Persons entitled to notices**

28.5 Any notice or other document to be given to a Member may be given by reference
to the register of Members as it stands at any time within the period of twenty-one days before the day that the notice is given or (where
and as applicable) within any other period permitted by, or in accordance with the requirements of, (to the extent applicable) the Designated
Stock Exchange Rules and/or the Designated Stock Exchanges. No change in the register of Members after that time shall invalidate the
giving of such notice or document or require the Company to give such item to any other person.

**Persons authorised to give notices**

28.6 A notice by either the Company or a Member pursuant to these Articles may
be given on behalf of the Company or a Member by a Director or company secretary of the Company or a Member.

---

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---

**Delivery of written notices**

28.7 Save where these Articles provide otherwise, a notice in writing may be
given personally to the recipient, or left at (as appropriate) the Member's or Director's registered address or the Company's
registered office, or posted to that registered address or registered office.

**Joint holders**

28.8 Where Members are joint holders of a Share, all notices shall be given to
the Member whose name first appears in the register of Members.

**Signatures**

28.9 A written notice shall be signed when it is autographed by or on behalf
of the giver, or is marked in such a way as to indicate its execution or adoption by the giver.

28.10 An Electronic Record may be signed by an Electronic Signature.

**Evidence of transmission**

28.11 A notice given by Electronic Record shall be deemed sent if an Electronic Record is kept demonstrating
the time, date and content of the transmission, and if no notification of failure to transmit is received by the giver.

28.12 A notice given in writing shall be deemed sent if the giver can provide proof that the envelope containing
the notice was properly addressed, pre-paid and posted, or that the written notice was otherwise properly transmitted to the recipient.

28.13 A Member present, either in person or by proxy, at any meeting of the Company or of the holders of any
class of Shares shall be deemed to have received due notice of the meeting and, where requisite, of the purposes for which it was called.

**Giving notice to a deceased or bankrupt Member**

28.14 A notice may be given by the Company to the persons entitled to a Share in consequence of the death or
bankruptcy of a Member by sending or delivering it, in any manner authorised by these Articles for the giving of notice to a Member, addressed
to them by name, or by the title of representatives of the deceased, or trustee of the bankrupt or by any like description, at the address,
if any, supplied for that purpose by the persons claiming to be so entitled.

28.15 Until such an address has been supplied, a notice may be given in any manner in which it might have been
given if the death or bankruptcy had not occurred.

---

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---

**Date of giving notices**

28.16 A notice is given on the date identified in the following
table

---

| | |
|:---|:---|
| &nbsp;&nbsp;**Method for giving notices** | &nbsp;&nbsp;**When taken to be given** |
| &nbsp;&nbsp;(A) Personally | &nbsp;&nbsp;At the time and date of delivery |
| &nbsp;&nbsp;(B) By leaving it at the Member's registered address | &nbsp;&nbsp;At the time and date it was left |
| &nbsp;&nbsp;(C) By posting it by prepaid post to the street or postal address of that recipient | &nbsp;&nbsp;48 hours after the date it was posted |
| &nbsp;&nbsp;(D) By Electronic Record (other than publication on a website), to recipient's Electronic address | &nbsp;&nbsp;48 hours after the date it was sent |
| &nbsp;&nbsp;(E) By publication on a website | &nbsp;&nbsp;24 hours after the date on which the Member is deemed to have been notified of the publication of the notice or document on the website |

---

**Saving provision**

28.17 None of the preceding notice provisions shall derogate from the Articles about the delivery of written resolutions of Directors and
written resolutions of Members.

---

| | |
|:---|:---|
| **29** | **Authentication of Electronic Records** |

---

**Application of Articles**

29.1 Without limitation to any other provision of these Articles, any notice,
written resolution or other document under these Articles that is sent by Electronic means by a Member, or by the Secretary, or by a Director
or other Officer of the Company, shall be deemed to be authentic if either Article 29.2 or Article 29.4 applies.

**Authentication of documents sent by Members by Electronic means**

29.2 An Electronic Record of a notice, written resolution or other document sent
by Electronic means by or on behalf of one or more Members shall be deemed to be authentic if the following conditions are satisfied:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Member or each Member, as the case may be, signed the original document, and for this purpose **Original Document** includes several documents in like form signed by one or more of those Members; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Electronic Record of the Original Document was sent by Electronic means by, or at the direction of,
that Member to an address specified in accordance with these Articles for the purpose for which it was sent; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Article 29.7 does not apply.

---

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29.3 For example, where a sole Member signs a resolution and sends the Electronic
Record of the original resolution, or causes it to be sent, by facsimile transmission to the address in these Articles specified for that
purpose, the facsimile copy shall be deemed to be the written resolution of that Member unless Article 28.7 applies.

**Authentication of document sent by the Secretary or Officers of the Company by Electronic means**

29.4 An Electronic Record of a notice, written resolution or other document sent
by or on behalf of the Secretary or an Officer or Officers of the Company shall be deemed to be authentic if the following conditions
are satisfied:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Secretary or the Officer or each Officer, as the case may be, signed the original document, and for
this purpose **Original Document** includes several documents in like form signed by the Secretary or one or more of those Officers;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Electronic Record of the Original Document was sent by Electronic means by, or at the direction of,
the Secretary or that Officer to an address specified in accordance with these Articles for the purpose for which it was sent; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Article 29.7 does not apply.

This Article 29.4 applies whether the document is sent by or on behalf of the Secretary or Officer in his own right or as a representative of the Company.

29.5 For example, where a sole Director signs a resolution and scans the resolution,
or causes it to be scanned, as a PDF version which is attached to an email sent to the address in these Articles specified for that purpose,
the PDF version shall be deemed to be the written resolution of that Director unless Article 29.7 applies.

**Manner of signing**

29.6 For the purposes of these Articles about the authentication of Electronic
Records, a document will be taken to be signed if it is signed manually or in any other manner permitted by these Articles.

**Saving provision**

29.7 A notice, written resolution or other document under these Articles will
not be deemed to be authentic if the recipient, acting reasonably:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) believes that the signature of the signatory has been altered after the signatory had signed the original document; or

---

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---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) believes that the original document, or the Electronic Record of it, was altered, without the approval of the signatory, after the
signatory signed the original document; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) otherwise doubts the authenticity of the Electronic Record of the document

and the recipient promptly gives notice to the sender setting the grounds of its objection. If the recipient invokes this Article, the sender may seek to establish the authenticity of the Electronic Record in any way the sender thinks fit.

---

| | |
|:---|:---|
| **30** | **Transfer by way of continuation** |

---

30.1 The Company may, by Special Resolution, resolve to be registered by way of continuation in a jurisdiction
outside:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Cayman Islands; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) such other jurisdiction in which it is, for the time being, incorporated, registered or existing.

30.2 To give effect to any resolution made pursuant to the preceding Article, the Directors may cause the
following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) an application be made to the Registrar of Companies of the Cayman Islands to deregister the Company in
the Cayman Islands or in the other jurisdiction in which it is for the time being incorporated, registered or existing; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) all such further steps as they consider appropriate to be taken to effect the transfer by way of continuation of the Company.

---

| | |
|:---|:---|
| **31** | **Winding up** |

---

**Distribution of assets in specie**

31.1 If the Company is wound up the Members may, subject to these Articles and
any other sanction required by the Law, pass a Special Resolution allowing the liquidator to do either or both of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) to divide in specie among the Members the whole or any part of the assets of the Company and, for that
purpose, to value any assets and to determine how the division shall be carried out as between the Members or different classes of Members;
and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) to vest the whole or any part of the assets in trustees for the benefit of Members and those liable to contribute to the winding up.

---

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**No obligation to accept liability**

31.2 No Member shall be compelled
to accept any assets if an obligation attaches to them.

31.3 The Directors are authorised
to present a winding up petition

31.4 The Directors have the authority
to present a petition for the winding up of the Company to the Grand Court of the Cayman Islands on behalf of the Company without the
sanction of a resolution passed at a general meeting.

---

| | |
|:---|:---|
| **32** | **Amendment of Memorandum and Articles** |

---

**Power to change name or amend Memorandum**

32.1 Subject to the Law, the Company may, by Special Resolution:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) change its name; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) change the provisions of its Memorandum with respect to its objects, powers or any other matter specified in the Memorandum.

**Power to amend these Articles**

32.2 Subject to the Law and as provided
in these Articles, the Company may, by Special Resolution, amend these Articles in whole or in part.

---

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---

## Exhibit 2.2

**Exhibit 2.2**

**DESCRIPTION OF SECURITIES**

As of the end of the fiscal year covered by the annual report on Form 20-F (the "Annual Report") of Regencell Bioscience Holdings Limited ("we," "us" or "our") to which this description is attached or incorporated by reference as an exhibit, we registered the ordinary shares, par value $0.00001 (the "Ordinary Shares"), as set forth below, pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"):

---

| | | |
|:---|:---|:---|
| **Title of Each Class** | **Trading Symbol** | **Name of Each Exchange on Which<br> Registered** |
| Ordinary shares, par value $0.00001 | RGC | The Nasdaq Stock Market LLC |

---

The following summary of the material terms of our Ordinary Shares is not intended to be a complete summary of the rights and preferences of our Ordinary Shares. This summary is subject to and qualified in its entirety by reference to our memorandum and articles of association, as amended and restated from time to time ("our memorandum and articles of association"). We urge you to refer to our memorandum and articles of association in its entirety for a complete description of the rights and preferences of our Ordinary Shares. A copy of our amended and restated memorandum and articles of association adopted on May 31, 2021 was filed as Exhibit 3.2 to Amendment No. 2 to our Form F-1 Registration Statement (File No. 333-254571), which was filed with the U.S. Securities and Exchange Commission (the "SEC") on June 11, 2021.

**Information called for by Items 9.A.3 (Shareholder's Pre-emptive Purchase Right) and 9.A.6 (Limitation or Qualifications) of the Form 20-F**

None.

**Information called for by Items 9.A.5, 10.B.3, 10.B.4, 10.B.6, 10.B.7, 10.B.8, 10.B.9 and 10.B.10 of the Form 20-F**

The number of Ordinary Shares issued and outstanding as of the end of the fiscal year covered by the Annual Report, as required by Item 9.A.5(a) of the Form 20-F, is given on the cover page of the Annual Report to which this description is attached or incorporated by reference as an exhibit.

See "Item 10. Additional Information—B. Memorandum and Articles of Association" in the Annual Report, the section of which is incorporated herein by reference, for the following required information:

● our Ordinary Shares, including the registered form of the Ordinary Shares, our authorized share capital, the par value of the Ordinary Shares, required by Item 9.A.5 of the Form 20-F; limitations on the rights to own securities, including the rights of non-resident of the Cayman Islands, required by Item 10.B.6 of the Form 20-F; and threshold for any disclosure of the ownership of the Ordinary Shares, required by Item 10.B.8 of the Form 20-F;

● transfer of shares, required by Item 9.A.5 of the Form 20-F;

● rights of the Ordinary Shares, required by Item 10.B.3 of the Form 20-F;

● variation of rights of shares, required by Item 10.B.4 of the Form 20-F;

● provisions in relation to or affecting any change of control, required by Item 10.B.7 of the Form 20-F, including mergers and similar arrangements, and anti-takeover provisions;

● ownership threshold above which shareholder ownership must be disclosed, required by Item 10.B.8 of the Form 20-F.

● differences in corporate law from that in the U.S., required by Item 10.B.9 of the Form 20-F; and

● alteration of share capital, required by Item 10.B.10 of the Form 20-F.

**Information called for by Items 9.A.7 (Rights of Securities other than the Listed Ordinary Shares), 12.A (Registered Debt Securities), 12.B (Registered Warrants and Rights), 12.C (Registered Securities Other Than Equity, Debt, Warrants or Rights), and 12.D.1 and 12.D.2 (Registered American Depositary Shares) of the Form 20-F**

Not applicable.

## Exhibit 8.1

**Exhibit 8.1**

**LIST OF SUBSIDIARIES AND AFFILIATED ENTITIES OF<br> REGENCELL BIOSCIENCE HOLDINGS LIMITED**

---

| | |
|:---|:---|
| **Name of Wholly-owned Subsidiaries** | **Place of Incorporation** |
| Regencell Bioscience Limited | Hong Kong |
| Regencell Limited | Hong Kong |
| Regencell Bioscience North America Limited | British Virgin Islands |

---

---

| | |
|:---|:---|
| **List of Affiliated Entities** | **Place of Incorporation** |
| Regencell Bioscience Asia Limited (a 60% owned joint venture) – Ceased business on December 31, 2023 and deregistered on November 1, 2024 | Hong Kong |

---

## Exhibit 12.1

**Exhibit 12.1**

**Certification by the Principal Executive Officer<br> Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**

I, Yat-Gai Au, certify that:

1. I
 have reviewed this annual report on Form 20-F of Regencell Bioscience Holdings Limited (the
 "**Company** ");

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or
 omit to state a material fact necessary to make the statements made, in light of the circumstances
 under which such statements were made, not misleading with respect to the period covered
 by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this
 report, fairly present in all material respects the financial condition, results of operations
 and cash flows of the Company as of, and for, the periods presented in this report;

4. The
 Company's other certifying officer and I are responsible for establishing and maintaining
 disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
 and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)
 and 15d-15(f)) for the Company and have:

&nbsp;&nbsp;&nbsp;&nbsp;a. Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures
 to be designed under our supervision, to ensure that material information relating to the
 Company, including its consolidated subsidiaries, is made known to us by others within those
 entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;b. Designed
 such internal control over financial reporting, or caused such internal control over financial
 reporting to be designed under our supervision, to provide reasonable assurance regarding
 the reliability of financial reporting and the preparation of financial statements for external
 purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;c. Evaluated
 the effectiveness of the Company's disclosure controls and procedures and presented
 in this report our conclusions about the effectiveness of the disclosure controls and procedures,
 as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;d. Disclosed
 in this report any change in the Company's internal control over financial reporting
 that occurred during the period covered by the annual report that has materially affected,
 or is reasonably likely to materially affect, the Company's internal control over financial
 reporting; and

5. The
 Company's other certifying officer and I have disclosed, based on our most recent evaluation
 of internal control over financial reporting, to the Company's auditors and the audit
 committee of the Company's board of directors (or persons performing the equivalent
 functions):

&nbsp;&nbsp;&nbsp;&nbsp;a. All
 significant deficiencies and material weaknesses in the design or operation of internal control
 over financial reporting which are reasonably likely to adversely affect the Company's
 ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;b. Any
 fraud, whether or not material, that involves management or other employees who have a significant
 role in the Company's internal control over financial reporting.

---

| | |
|:---|:---|
| Date: | October 31, 2025 |
| By: | /s/ Yat-Gai Au |
| Name: | Yat-Gai Au |
| Title: | Chief Executive Officer <br> (*Principal Executive Officer*) |

---

## Exhibit 12.2

**Exhibit 12.2**

**Certification by the Principal Financial Officer<br> Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002**

I, Michelle Chan, certify that:

1. I
 have reviewed this annual report on Form 20-F of Regencell Bioscience Holdings Limited (the
 "**Company** ");

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or
 omit to state a material fact necessary to make the statements made, in light of the circumstances
 under which such statements were made, not misleading with respect to the period covered
 by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this
 report, fairly present in all material respects the financial condition, results of operations
 and cash flows of the Company as of, and for, the periods presented in this report;

4. The
 Company's other certifying officer and I are responsible for establishing and maintaining
 disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
 and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f)
 and 15d-15(f)) for the Company and have:

&nbsp;&nbsp;&nbsp;&nbsp;a. Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures
 to be designed under our supervision, to ensure that material information relating to the
 Company, including its consolidated subsidiaries, is made known to us by others within those
 entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;b. Designed
 such internal control over financial reporting, or caused such internal control over financial
 reporting to be designed under our supervision, to provide reasonable assurance regarding
 the reliability of financial reporting and the preparation of financial statements for external
 purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;c. Evaluated
 the effectiveness of the Company's disclosure controls and procedures and presented
 in this report our conclusions about the effectiveness of the disclosure controls and procedures,
 as of the end of the period covered by this report based on such evaluation; and

&nbsp;&nbsp;&nbsp;&nbsp;d. Disclosed
 in this report any change in the Company's internal control over financial reporting
 that occurred during the period covered by the annual report that has materially affected,
 or is reasonably likely to materially affect, the Company's internal control over financial
 reporting; and

5. The
 Company's other certifying officer and I have disclosed, based on our most recent evaluation
 of internal control over financial reporting, to the Company's auditors and the audit
 committee of the Company's board of directors (or persons performing the equivalent
 functions):

&nbsp;&nbsp;&nbsp;&nbsp;a. All
 significant deficiencies and material weaknesses in the design or operation of internal control
 over financial reporting which are reasonably likely to adversely affect the Company's
 ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;b. Any
 fraud, whether or not material, that involves management or other employees who have a significant
 role in the Company's internal control over financial reporting.

---

| | |
|:---|:---|
| Date: | October 31, 2025 |
| By: | /s/ Michelle Chan |
| Name: | Michelle Chan |
| Title: | Financial Controller<br> (*Principal Financial Officer*) |

---

## Exhibit 13.1

**Exhibit 13.1**

**Certification of the Principal Executive Officer<br> Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**

In connection with the Annual Report of Regencell Bioscience Holdings Limited (the "**Company**") on Form 20-F for the fiscal year ended June 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the "**Report**"), I, Yat-Gai Au, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The
Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Company.

Dated: October 31, 2025

---

| | |
|:---|:---|
| By: | /s/ Yat-Gai Au |
| Name: | Yat-Gai Au |
| Title: | Chief Executive Officer<br> (*Principal Executive Officer*) |

---

## Exhibit 13.2

**Exhibit 13.2**

**Certification of the Principal Financial Officer<br> Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**

In connection with the Annual Report of Regencell Bioscience Holdings Limited (the "**Company**") on Form 20-F for the fiscal year ended June 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the "**Report**"), I, Michelle Chan, financial controller of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The
Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Company.

Dated: October 31, 2025

---

| | |
|:---|:---|
| By: | /s/ Michelle Chan |
| Name: | Michelle Chan |
| Title: | Financial Controller<br> (*Principal Financial Officer*) |

---