# EDGAR Filing Document

**Accession Number:** 0001986247
**File Stem:** 0001213900-26-021984
**Filing Date:** 2026-3
**Character Count:** 672391
**Document Hash:** 277d0f525c808a5b4565dcf3d850c709
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-26-021984.hdr.sgml**: 20260302

**ACCESSION NUMBER**: 0001213900-26-021984

**CONFORMED SUBMISSION TYPE**: 20-F

**PUBLIC DOCUMENT COUNT**: 171

**CONFORMED PERIOD OF REPORT**: 20251031

**FILED AS OF DATE**: 20260302

**DATE AS OF CHANGE**: 20260302

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Park Ha Biological Technology Co., Ltd.
- **CENTRAL INDEX KEY:** 0001986247
- **STANDARD INDUSTRIAL CLASSIFICATION:** SOAP, DETERGENT, CLEANING PREPARATIONS, PERFUMES, COSMETICS [2840]
- **ORGANIZATION NAME:** 08 Industrial Applications and Services
- **EIN:** 000000000
- **STATE OF INCORPORATION:** F4
- **FISCAL YEAR END:** 1031

**FILING VALUES:**
- **FORM TYPE:** 20-F
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-42453
- **FILM NUMBER:** 26703392

**BUSINESS ADDRESS:**
- **STREET 1:** NO. 50 XIUXI ROAD
- **STREET 2:** 14F, BUILDING 3
- **CITY:** WUXI CITY
- **STATE:** F4
- **ZIP:** 214135
- **BUSINESS PHONE:** 864000127562

**MAIL ADDRESS:**
- **STREET 1:** NO. 50 XIUXI ROAD
- **STREET 2:** 14F, BUILDING 3
- **CITY:** WUXI CITY
- **STATE:** F4
- **ZIP:** 214135

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

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 20-F**

**(Mark One)**

☐ **REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OR 12(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 October 31, 2025

**OR**

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

**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

For the transition period from ____________ to ____________

Commission file number: 001-42453

**Park Ha Biological Technology Co., Ltd.**

(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)

**901, Building C**

**Phase 2, Wuxi International Life Science Innovation Campus**

**196 Jinghui East Road**

**Xinwu District, Wuxi, Jiangsu Province**

**People's Republic of China 214000**

(Address of principal executive offices)

**Xiaoqiu Zhang, Chief Executive Officer**

**Tel.: +86 400 012 7562**

**Email: ir@parkha.cn** 

**901, Building C**

**Phase 2, Wuxi International Life Science Innovation Campus**

**196 Jinghui East Road**

**Xinwu District, Wuxi, Jiangsu Province**

**People's Republic of China 214000**

(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(s)** | **Name of each exchange on which registered** |
| Ordinary Shares, par value <br> $0.001 per share | BYAH | The Nasdaq Stock Market LLC<br> (Nasdaq Capital Market) |

---

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 October 31, 2025, there were 296,488 Class A ordinary shares issued and 381,000 Class B 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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post 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 the definitions of "large accelerated filer," "accelerated filer," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ <br> 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. ☐

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 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). ☐

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 Securities Exchange Act of 1934).

☐ 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 |
| [FORWARD-LOOKING INFORMATION](#a_002) | [FORWARD-LOOKING INFORMATION](#a_002) | iv |
| [PART I](#a_003) |  | 1 |
| ITEM 1. | [IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS](#a_004) | 1 |
| ITEM 2. | [OFFER STATISTICS AND EXPECTED TIMETABLE](#a_005) | 1 |
| ITEM 3. | [KEY INFORMATION](#a_006) | 1 |
| ITEM 4. | [INFORMATION ON THE COMPANY](#a_007) | 49 |
| ITEM 4A. | [UNRESOLVED STAFF COMMENTS](#a_008) | 85 |
| ITEM 5. | [OPERATING AND FINANCIAL REVIEW AND PROSPECTS](#a_009) | 86 |
| ITEM 6. | [DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES](#a_010) | 102 |
| ITEM 7. | [MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS](#a_011) | 110 |
| ITEM 8. | [FINANCIAL INFORMATION](#a_012) | 110 |
| ITEM 9. | [THE OFFER AND LISTING](#a_013) | 111 |
| ITEM 10. | [ADDITIONAL INFORMATION](#a_014) | 111 |
| ITEM 11. | [QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](#a_015) | 132 |
| ITEM 12. | [DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES](#a_016) | 132 |
| [PART II](#a_017) |  | 133 |
| ITEM 13. | [DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES](#a_018) | 133 |
| ITEM 14. | [MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS](#a_019) | 133 |
| ITEM 15. | [CONTROLS AND PROCEDURES](#a_020) | 133 |
| ITEM 16. | [\[RESERVED\]](#a_021) | 134 |
| ITEM 16A. | [AUDIT COMMITTEE FINANCIAL EXPERT](#a_022) | 134 |
| ITEM 16B. | [CODE OF ETHICS](#a_023) | 134 |
| ITEM 16C. | [PRINCIPAL ACCOUNTANT FEES AND SERVICES](#a_024) | 134 |
| ITEM 16D. | [EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES](#a_025) | 135 |
| ITEM 16E. | [PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS](#a_026) | 135 |
| ITEM 16F. | [CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT](#a_027) | 135 |
| ITEM 16G. | [CORPORATE GOVERNANC](#a_028) | 135 |
| ITEM 16H. | [MINE SAFETY DISCLOSURE](#a_029) | 135 |
| ITEM 16I. | [DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS](#a_030) | 135 |
| ITEM 16J. | [INSIDER TRADING POLICIES](#a_031) | 135 |
| ITEM 16K. | [CYBERSECURITY](#a_032) | 135 |
| [PART III](#a_033) |  | 136 |
| ITEM 17. | [FINANCIAL STATEMENTS](#a_034) | 136 |
| ITEM 18. | [FINANCIAL STATEMENTS](#a_035) | 136 |
| ITEM 19. | [EXHIBITS](#a_036) | 136 |

---

i

**INTRODUCTION**

Except where the context otherwise requires and for purposes of this annual report only:

● "CAC" refers to the Cyberspace Administration of China;

● "China" or the "PRC" refers to the People's Republic of China; and only when in this annual report refers to specific laws and regulations adopted by the PRC, excludes Hong Kong, Macau and Taiwan;

● "Class A Ordinary Shares" refers to the Company's class A ordinary shares, par value US$0.001 per share;

● "Class B Ordinary Shares" refers to the Company's class B ordinary shares, par value US$0.001 per share;

● "CSRC" refers to the Chinese Securities Regulatory Commission;

● "Exchange Act" refers to the Securities Exchange Act of 1934, as amended;

● "HFCAA" refers to the Holding Foreign Companies Accountable Act;

● "Hong Kong" refers to the Hong Kong Special Administrative Region of the People's Republic of China;

● "MOFCOM" refers to the Ministry of Commerce of China;

● "NDRC" refers to the National Development and Reform Commission of China;

● "O2O Model" are to the Online-to-Offline Model, which is a business strategy involving the use of digital marketing channels to draw potential customers to make purchases in brick-and-mortar stores;

● "Ordinary Shares" refers to the ordinary shares of the Company, par value $0.001 per share;

● "Park Ha HK" refers to Park Ha Biological Technology (HK) Co., Limited, a Hong Kong company, which is a wholly-owned subsidiary of Park Ha Cayman;

● "Park Ha Jiangsu" refers to Jiangsu Park Ha Biological Technology Co., Ltd., a PRC limited liability company, which is a wholly owned subsidiary of WFOE;

● "Park Ha Shanghai" refers to Shanghai Park Ha Industrial Development Co., Ltd., a PRC limited liability company, which is a wholly-owned subsidiary of Xinzhan;

● "PCAOB" refers to the Public Company Accounting Oversight Board;

● "PRC subsidiaries" refers to WFOE, Park Ha Jiangsu, Park Ha Shanghai, Xinzhan , Muchen and Mufeng;

● "RMB" or "Renminbi" refers to the legal currency of China;

● "SAFE" refers to the State Administration of Foreign Exchange of the PRC;

● "SAT" refers to the State Administration of Taxation of the PRC;

ii

● "SCNPC" refers to the Standing Committee of the National People's Congress;

● "SEC" refers to the United States Securities and Exchange Commission;

● "Securities Act" refers to the Securities Act of 1933, as amended;

● "US$," "U.S. dollars," or "dollars" refers to the legal currency of the United States;

● "we," "us," "our," the "Company," "Park Ha Cayman" refers to Park Ha Biological Technology Co., Ltd., a Cayman Islands exempted company limited by shares;

● "WFOE" refers to Park Ha Investment (Wuxi) Co., Ltd., a wholly foreign-owned enterprise in the PRC and a wholly owned subsidiary of Park Ha HK;

● "Xinzhan" refers to Wuxi Xinzhan Enterprise Management Consulting Co., Ltd., a PRC limited liability company, which is a wholly-owned subsidiary of WFOE;

● "Muchen" refers to Wuxi Muchen Biotechnology Co., Ltd., a PRC limited liability company, which is a wholly-owned subsidiary of Park Ha Jiangsu;

● "Mufeng" refers to Wuxi Mufeng Biotechnology Co., Ltd., a PRC limited liability company, which is a wholly-owned subsidiary of Park Ha Jiangsu;

● "Xinyuexuan" refers to Xinyuexuan Beauty Salon,Wuxi Economic Development Zone, which is controlled by Park Ha Jiangsu through contractual arrangement as its variable interst entity("VIE");

● "Aimeihui" refers to Aimeihui Beauty Center,Wuxi Economic Development Zone, which is controlled by Park Ha Jiangsu through contractual arrangement as its variable interst entity("VIE"); and

● "Xuanyayue" refers to Huishan District Xuanyayue Beauty Salon, which is controlled by Park Ha Jiangsu through contractual arrangement as its variable interst entity("VIE").

iii

**FORWARD-LOOKING INFORMATION**

This annual report contains statements that constitute forward-looking statements. Many of the forward-looking statements contained in this annual report can be identified by the use of forward-looking words such as "anticipate," "believe," "could," "expect," "should," "plan," "intend," "estimate" and "potential," among others.

Forward-looking statements appear in a number of places in this annual report and include, but are not limited to, statements regarding our intent, belief or current expectations. Forward-looking statements are based on our management's beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, those identified under the section entitled "Item 3. Key Information — D. Risk Factors" in this annual report. These risks and uncertainties include factors relating to:

● changes in general economic, government policies and regulation;

● the expected growth and competition in the industry;

● our ability to compete and conduct our business in the future;

● our ability to implement our growth strategy;

● our ability to attract and retain qualified executives and personnel;

● our ability to maintain the listing of our securities on a U.S. securities exchange; and

● other risks factors discussed under "Item 3. Key Information — D. Risk Factors."

Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them in light of new information or future developments or to release publicly any revisions to these statements in order to reflect later events or circumstances or to reflect the occurrence of unanticipated events.

iv

**PART I**

**ITEM 1. IDENTIFY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS**

Not applicable.

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

Not applicable.

**ITEM 3. KEY INFORMATION**

**Risks Associated with being based in the PRC**

We are subject to certain legal and operational risks associated with being based in the PRC, which could result in a material change in our operations and/or the value of our securities, or could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or become worthless. The PRC government adopted a series of regulatory actions and issued statements to regulate business operations in the PRC with little advance notice, including cracking down on illegal activities in the securities market, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. For example, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the Opinions on Severely Cracking Down on Illegal Securities Activities According to Law, which were made available to the public on July 6, 2021. The opinions emphasized the need to strengthen the administration over illegal securities activities and the need to strengthen the supervision over overseas listings by Chinese companies.

***Cybersecurity Review***

On December 28, 2021, the Cyberspace Administration of China (the "CAC"), together with 12 other regulatory authorities jointly promulgated the amended Cybersecurity Review Measures, which became effective on February 15, 2022. The amended Cybersecurity Review Measures provide that a "internet platform operator" that possesses personal information of more than one million users and seeks a listing in a foreign country must apply for a cybersecurity review. Further, if a critical information infrastructure operator ("CIIO") purchases Internet products and services that affect or may affect national security, it should be subject to cybersecurity review by the CAC. In addition, on March 22, 2024, the CAC issued the Provisions on Promoting and Standardizing Cross-Border Data Flows, which set forth the circumstances exempted from performing the security assessment or filing procedures for cross-border data transfer and further clarify the thresholds and scenarios for data processors to go through these procedures as stipulated under the aforementioned measures.

As of the date of this annual report, we and our PRC subsidiaries have not been involved in any investigations on cybersecurity review initiated by any PRC regulatory authority, nor has any of them received any inquiry, notice, or sanction.

As of the date of this annual report, we are not subject to cybersecurity review with the CAC or national security review, or any other security assessment or filing procedures for cross-border data transfer, given that our PRC subsidiaries are not CIIOs or internet platform operators that possess personal information of more than one million users or engage in data processing activities that affect or may affect national security.

There remains uncertainty, however, as to how the amended Cybersecurity Review Measures will be interpreted or implemented and whether the PRC regulatory authorities may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the amended Cybersecurity Review Measures. See "— D. Risk Factors — Risks Related to Doing Business in the PRC — Recent greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business and our offering."

***CSRC Filing Requirements***

On February 17, 2023, the CSRC promulgated the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies (the "Trial Measures") and five supporting guidelines, which came into effect on March 31, 2023. Under the Trial Measures, a filing-based regulatory system shall be applied to "indirect overseas offerings and listings" of PRC domestic companies, which refers to securities offerings and listings in an overseas market made under the name of an offshore entity but based on the underlying equity, assets, earnings or other similar rights of a domestic company that operates its main business domestically. The Trial Measures state that, any post-listing follow-on offering by an issuer in the same overseas market, including issuance of shares, convertible notes and other similar securities, shall be subject to filing requirement within three business days after the completion of the offering. Therefore, any of our future offering in an overseas market shall be subject to the filing requirements under the Trial Measures.

If we fail to obtain required approval or complete other review or filing procedures, under the Trial Measures or otherwise, for any future overseas securities offering, we may face sanctions by the CSRC or other PRC regulatory authorities, which may include fines and penalties on our operations in China, limitations on our operating privileges in China, restrictions on or prohibition of the payments or remittance of dividends by our subsidiaries in China, restrictions on or delays to our future financing transactions offshore, or other actions that could have a material and adverse effect on our business, financial condition, results of operations, reputation and prospects, as well as the trading price of the Ordinary Shares. See "— D. Risk Factors — Risks Related to Doing Business in the PRC — The approval or filing of the CSRC or other PRC regulatory agencies may be required to maintain our listing status or conduct future offshore securities offerings."

**Permission Required from the PRC Authorities**

As of the date of this annual report, our PRC subsidiaries have obtained all permissions and approvals to operate their respective business, including business license, social insurance registration and health licenses. In addition, Xinzhan has completed record filing and annual reporting with the Ministry of Commerce of China, or the MOFCOM, to conduct franchise business. Xinzhan has also obtained a medical device operation permit, expiring on August 20, 2028, despite the fact that the devices in the stores are not medical devices and that the operation does not require such permit.

In addition, as described above, the PRC government has recently tightened the regulation of cybersecurity, and indicated an intent to exert more oversight and control over securities offerings and other capital markets activities that are conducted overseas and foreign investment in China-based companies like us. We are required to complete the filing with the CSRC for our future overseas securities offerings under the Trial Measures.

We manage our business operations in a prudent manner where we determine whether a particular regulatory permission or approval is required based on opinions and guidance from our in-house and external legal counsel and relevant governmental authorities, as the case may be. As of the date of this annual report, we have not received any regulatory notice requesting us to obtain a permission or approval that we have concluded is not required. If our PRC subsidiaries (i) do not receive or maintain required permissions or approvals, (ii) inadvertently conclude that such permissions or approvals are not required, or (iii) applicable laws, regulations, or interpretations change and our PRC subsidiaries are required to obtain such permissions or approvals in the future, they could be subject to fines, legal sanctions, or an order to suspend their relevant services, which may materially and adversely affect our financial condition and results of operations and cause our securities to significantly decline in value or become worthless.

On February 24, 2023, the CSRC jointly with other relevant governmental authorities, promulgated the Provisions on Strengthening the Confidentiality and Archives Administration of Overseas Securities Issuance and Listing by Domestic Enterprises, or the Confidentiality and Archives Management Provisions, which took effect on March 31, 2023. According to the Confidentiality and Archives Management Provisions, domestic companies, whether offering and listing securities overseas directly or indirectly, must strictly abide by the applicable laws and regulations when providing or publicly disclosing, either directly or through their overseas listed entities, documents and materials to securities services providers such as securities companies and accounting firms or overseas regulators in the process of their overseas offering and listing. If such documents or materials contain any state secrets or government authorities work secrets, domestic companies must obtain the approval from competent governmental authorities according to the applicable laws, and file with the secrecy administrative department at the same level with the approving governmental authority. Furthermore, the Confidentiality and Archives Management Provisions provide that securities companies and securities service providers shall fulfill the applicable legal procedures when providing overseas regulatory institutions and other relevant institutions and individuals with documents or materials containing any state secrets or government authorities work secrets or other documents or materials that, if divulged, will jeopardize national security or public interest. Since the Confidentiality and Archives Management Provisions were promulgated recently, substantial uncertainties still exist with respect to the interpretation and implementation of such provisions and how they will affect us.

As there are still uncertainties regarding the interpretation and implementation of such regulatory guidance, we cannot assure you that we will be able to comply with new regulatory requirements relating to our future overseas capital-raising activities and we may become subject to more stringent requirements with respect to matters such as cross-border investigation, data privacy, and enforcement of legal claims.

**Implication of the Holding Foreign Companies Accountable Act**

Trading in our securities on U.S. markets, including Nasdaq, may be prohibited under the Holding Foreign Companies Accountable Act ("HFCAA"), as amended by the Consolidated Appropriations Act, 2023, if the Public Company Accounting Oversight Board ("PCAOB") determines that it is unable to inspect or investigate completely our auditor for two consecutive years. On December 16, 2021, the PCAOB issued the HFCAA Determination Report to notify the SEC of its determinations that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong, including our auditor. The inability of the PCAOB to conduct inspections in the past also deprived our investors of the benefits of such inspections. On December 15, 2022, the PCAOB announced that it was able to conduct inspections and investigations completely of PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong in 2022. The PCAOB vacated its previous 2021 determinations accordingly.

On December 29, 2022, the Consolidated Appropriations Act, 2023, was signed into law, amending the HFCAA in two significant ways: (i) reducing the consecutive non-inspection years required to trigger HFCAA prohibitions from three to two, and (ii) allowing any foreign jurisdiction to be the basis for the PCAOB's incomplete access to inspect or investigate a company's auditor. Initially, the HFCAA applied only if the PCAOB's inability to inspect or investigate resulted from a stance taken by an authority in the foreign jurisdiction where the relevant public accounting firm operated. Following the Consolidated Appropriations Act, 2023, the HFCAA now also applies if the PCAOB's inability to inspect or investigate the relevant accounting firm arises from a stance taken by an authority in any foreign jurisdiction, irrespective of the location of the accounting firm. However, whether the PCAOB will continue to conduct inspections and investigations completely to its satisfaction 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, including positions taken by authorities of the PRC. The PCAOB is expected to continue to demand complete access to inspections and investigations against accounting firms headquartered in mainland China and Hong Kong in the future and states that it has already made plans to resume regular inspections in early 2023 and beyond. The PCAOB is required under the HFCAA to make its determination on an annual basis with regards to its ability to inspect and investigate completely accounting firms based in the mainland China and Hong Kong, among other jurisdictions. The possibility of being a "Commission-Identified Issuer" and risk of delisting could continue to adversely affect the trading price of our securities. If the PCAOB determines in the future that it no longer has full access to inspect and investigate accounting firms headquartered in mainland China and Hong Kong and we continue to use such accounting firm to conduct audit work, we would be identified as a "Commission-Identified Issuer" under the HFCAA following the filing of the annual report for the relevant fiscal year, and if we were so identified for two consecutive years, trading in our securities on U.S. markets would be prohibited, and Nasdaq may determine to delist our securities. For the details of the risks associated with the enactment of the HFCAA, see "— D. Risk Factors — Risks Related to Doing Business in the PRC — The continued U.S. regulatory and legislative focus, including the enactment of the HFCAA, may adversely affect the market price of our Ordinary Shares and may eventually require us to delist our securities from the U.S. markets."

**Transfers of cash to and from our subsidiaries**

We are a holding company with no business operations of our own and conduct all of our operations through our PRC subsidiaries. As a result, our ability to pay dividends and to service any debt we may incur overseas largely depends upon dividends paid by our subsidiaries. If our PRC subsidiaries incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us.

Our PRC subsidiaries are permitted to pay dividends to us only out of their retained earnings, if any, as determined in accordance with the Accounting Standards for Business Enterprise as promulgated by the Ministry of Finance of the PRC, or the PRC GAAP. Pursuant to the laws and regulations applicable to China's foreign-invested enterprises ("FIEs"), our subsidiaries that are FIEs in the PRC have to make appropriation from their after-tax profit, as determined under PRC GAAP, to reserve funds including (i) general reserve fund, (ii) enterprise expansion fund and (iii) staff bonus and welfare fund. The appropriation to the general reserve fund must be at least 10% of the after-tax profits calculated in accordance with the PRC GAAP. Appropriation is not required if the reserve fund has reached 50% of the registered capital of our subsidiaries. Appropriation to the other two reserve funds is at our subsidiaries' discretion. See "Item 4. Information on the Company — B. Business Overview — Regulations — Regulations on Dividend Distribution" for a detailed discussion of the PRC legal restrictions on dividends and our ability to transfer cash within our group.

As of the date of this annual report, no dividends, distributions, or transfers have been made between Park Ha Cayman and any of its subsidiaries or among any of its subsidiaries. In addition, there have not been any dividends or distributions made by any subsidiaries to Park Ha Cayman subsidiaries. In addition, there have not been any dividends or distributions made by any subsidiaries to Park Ha Cayman for the fiscal year ended October 31, 2025. Park Ha Cayman has not distributed dividends to its shareholders enterprise for PRC tax purposes for the fiscal year ended October 31, 2025.

**A. [Reserved]**

**B. Capitalization and Indebtedness**

Not applicable.

**C. Reasons for the Offer and Use of Proceeds**

Not applicable.

**D. Risk Factors**

Below please find a summary of the principal risks we face, organized under relevant headings.

**Risks Related to Doing Business in the PRC**

● To the extent cash or assets in the business are in the PRC or Hong Kong or a PRC or Hong Kong entity, the funds or assets may not be available to fund operations or for other uses outside of the PRC or Hong Kong due to interventions in or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets;

● Uncertainties with respect to the PRC legal system, including risks and uncertainties regarding the enforcement of laws and that rules and regulations in China can change quickly with little advance notice, which could materially adversely affect our business;

● The PRC government may intervene or influence our operations at any time and with no advance notice, or may exert more oversight and control over our operations, and offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in our operations and/or significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or become worthless;

● The approval or filing of the CSRC or other PRC regulatory agencies may be required to maintain our listing status or conduct future offshore securities offerings;

● The continued U.S. regulatory and legislative focus, including the enactment of the HFCAA, may adversely affect the market price of our Ordinary Shares and may eventually require us to delist our securities from the U.S. markets;

● Recent greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business and our offering;

● We may rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business;

● You may experience difficulties in effecting service of legal process, enforcing foreign judgments or bringing actions in China against us or our management named in this annual report based on foreign laws;

● It may be difficult for overseas regulators to conduct investigations or collect evidence within China;

● Changes in international trade policies, trade disputes, barriers to trade, or the emergence of a trade war may influence growth in China;

● Fluctuations in currency exchange rates could have a material and adverse effect on the value of your investment;

● Governmental regulations on currency conversion may limit our ability to utilize our revenues effectively and affect the value of your investment;

● Changes in PRC political, economic and governmental policies may have an adverse impact on our business;

● Failure to comply with PRC laws and regulations related to labor and employee benefits may subject us to penalties or additional cost;

● The PRC Labor Contract Law, increased labor costs or other factors affecting our labor force in the PRC may adversely affect our business and results of operations;

● PRC regulation of loans to, and direct investment in, PRC entities by offshore holding companies may delay or prevent us from using the proceeds from any future financings to make loans or additional capital contributions to our PRC subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business;

● Certain PRC regulations may make it more difficult for us to pursue growth through acquisitions;

● We may be classified as a PRC resident enterprise for PRC enterprise income tax purposes, which could result in unfavorable tax consequences to us and our shareholders; and

● PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiaries' ability to change their registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC laws.

**Risks Related to Our Business and Industry**

Risks and uncertainties related to our business and industry, include but are not limited to the following:

● The PRC subsidiaries operate in a dynamic industry and have a limited operating history. Our historical results of operations and financial performance may not be indicative of future performance;

● The beauty industry is highly competitive. If we are unable to compete effectively, we may lose our market share and our business, results of operations and financial condition may be materially and adversely affected;

● Our success is dependent on the continued popularity of our products and our ability to anticipate and respond to changes in industry trends and consumer preferences and behavior in a timely manner;

● Our business depends, in part, on the quality, effectiveness and safety of our products;

● If we are unable to provide superior customer experiences, our business and reputation may be materially and adversely affected;

● We rely on a limited number of suppliers to provide us with the raw materials and ingredients we use for the products. We may not be able to obtain such supplies at competitive prices during times of high demand, which could have a material adverse effect on our business, financial condition and results of operations;

● We derive a significant portion of our revenue from a few major customers. Any significant decrease in the demand from our largest customers for our products may materially and adversely affect our financial conditions and results of operations; and

● Our success depends on the implementation of the franchise business model. Our growth through franchising may not occur as rapidly as we anticipate.

**Risks Related to the Our Ordinary Shares**

Risks and uncertainties related to our business and industry, include but are not limited to the following:

● Our Chairperson of the Board of Directors and Chief Executive Officer, Ms. Xiaoqiu Zhang, has a significant influence over our Company and future corporate decisions. Her interests may not always be aligned with those of other shareholders;

● We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements;

● As a company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from the Nasdaq Listing Rules;

● We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to U.S. domestic public companies;

● The trading price of the Ordinary Shares is likely to be volatile, which could result in substantial losses to investors; and

● If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud.

**Risks Related to the Variable interest entity**

● Contract execution risk: VIEs agreement may not be fully enforced by Chinese courts; The Company may not have actual control over these stores.

● Policy and regulatory risks: Chinese regulatory agencies (such as the China Securities Regulatory Commission and the State Administration of Foreign Exchange) may determine that the structure violates foreign investment access restrictions, resulting in penalties or structural failure.

● Controller risk: VIE holders (nominally Chinese individual business owners) may violate the agreement and harm the company's interests.

● Consolidated reporting risk: If accounting standards change or auditors determine that the company is not the primary beneficiary, it may result in these stores no longer being consolidated, impacting reported revenue.

**Risks Related to Doing Business in the PRC**

***To the extent cash or assets in the business are in the PRC or Hong Kong or a PRC or Hong Kong entity, the funds or assets may not be available to fund operations or for other uses outside of the PRC or Hong Kong due to the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets.***

The transfer of funds and assets between the Company and its subsidiaries is subject to restrictions. The PRC government regulates the conversion of the RMB into foreign currencies and the remittance of currencies out of the PRC. In addition, the PRC Enterprise Income Tax Law, or the EIT Law, and its implementation rules provide that a withholding tax at a rate of 10% will be applicable to dividends payable by PRC enterprises to non-PRC-resident enterprises unless reduced under treaties or arrangements between the PRC central government and the governments of other countries or regions where the non-PRC resident enterprises are tax resident. As of the date of this annual report, there are no restrictions or limitations imposed by the Hong Kong government on the transfer of capital within, into and out of Hong Kong (including funds from Hong Kong to the PRC), unless the transfer of funds involves money laundering and criminal activities. However, there is no guarantee that the Hong Kong government will not promulgate new laws or regulations that may impose such restrictions in the future.

As a result of the above, to the extent cash or assets in the business are in the PRC or Hong Kong or a PRC or Hong Kong entity, the PRC government may, in the future, impose restrictions or limitations on our ability to transfer money into and out of Hong Kong, to distribute earnings and pay dividends to and from and among our subsidiaries. Such restrictions and limitations, if imposed in the future, may delay or hinder the expansion of our business and may affect our ability to receive funds from our subsidiary in Hong Kong.

***Uncertainties with respect to the PRC legal system, including risks and uncertainties regarding the enforcement of laws and that rules and regulations in China can change quickly with little advance notice, which could materially adversely affect our business.***

Our PRC subsidiaries are incorporated under and governed by the laws of the PRC. The overall effect of legislation over the past three decades has significantly enhanced the protections afforded to various forms of foreign investments in China. In particular, the PRC legal system is a civil law system based on written statutes. Prior court decisions may be cited for reference but have limited precedential value. In 1979, the PRC government began to promulgate a comprehensive system of laws and regulations governing economic matters in general, such as foreign investment, corporate organization and governance, commerce, taxation and trade. The PRC legal system continues to evolve rapidly, the interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules still evolving, which may limit legal protections available to us. Uncertainties due to evolving laws and regulations could also impede the ability of a China-based company, such as our Company, to obtain or maintain permits or licenses required to conduct business in China. In the absence of required permits or licenses, governmental authorities could impose material sanctions or penalties on us. In addition, some regulatory requirements issued by certain PRC government authorities may not be consistently applied by other PRC government authorities (including local government authorities), thus making strict compliance with all regulatory requirements impractical, or in some circumstances impossible. For example, we may have to resort to administrative and court proceedings to enforce the legal protection that we enjoy either by law or contract.

Moreover, the PRC administrative and court authorities have discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to predict the outcome of administrative and court proceedings and the level of legal protection we enjoy than in more developed legal systems. We cannot predict the effects of future developments in the PRC legal system on our business operations, including the promulgation of new laws, or changes to existing laws or the interpretation or enforcement thereof. These uncertainties could limit the legal protections available to us and our investors, including you.

***The PRC government may intervene or influence our operations at any time and with no advance notice, or may exert more oversight and control over our operations, and offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in our operations and/or significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or become worthless.***

We conduct all of our business in China through our PRC subsidiaries. Accordingly, our business, results of operations and financial condition may be influenced to a significant degree by the PRC political, economic and social conditions. The PRC government may intervene or influence our operations at any time and with no advance notice, which could result in a material change in our operations and/or the value of our securities.

The Chinese government has exercised and continues to exercise substantial control over the Chinese economy through regulation and state ownership. Our ability to operate in China may be harmed by changes in its laws and regulations, including those relating to taxation, environmental regulations, land use rights, property and other matters. The central or local governments of these jurisdictions may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our compliance with such regulations or interpretations. Accordingly, government actions in the future, including any decision not to continue to support recent economic reforms and to return to a more centrally planned economy or regional or local variations in the implementation of economic policies, could have a significant effect on economic conditions in China or particular regions thereof and could require us to divest ourselves of any interest we then hold in Chinese properties.

As such, our business may be subject to various government and regulatory interference in the provinces in which we operate. We could be subject to regulation by various political and regulatory entities, including various local and municipal agencies and government sub-divisions. We may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply. The Chinese government may intervene or influence our operations at any time with little advance notice, which could result in a material change in our operations and the value of our Ordinary Shares. Any actions by the Chinese government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or become worthless.

***The approval or filing of the CSRC or other PRC regulatory agencies may be required to maintain our listing status or conduct future offshore securities offerings.***

On February 17, 2023, the CSRC promulgated the Trial Measures, which came into effect on March 31, 2023. Under the Trial Measures, a filing-based regulatory system shall be applied to "indirect overseas offerings and listings" of PRC domestic companies. Pursuant to the Trial Measures, if the issuer meets either of the following conditions, its securities offerings and listing will be deemed as an "indirect overseas offering and listing by a PRC domestic company" and is therefore subject to the filing requirements: (i) any of the revenues, profits, total assets or net assets of the issuer's Chinese operating entities in the most recent financial year accounts for more than 50% of the corresponding data in the issuer's audited consolidated financial statements for the same period; and (ii) the key link of its business operations are conducted in mainland China or its principal place of business is located in the mainland China, or the majority of senior management in charge of business operations are Chinese citizens or have domicile in the PRC. The Trial Measures state that, any post-listing follow-on offering by an issuer in the same overseas market, including issuance of shares, convertible notes and other similar securities, shall be subject to filing requirement within three business days after the completion of the offering. Therefore, any of our future offerings in an overseas market will be subject to the filing requirements under the Trial Measures. If we fail to complete the filing procedures with the CSRC for any future overseas securities offering, we may face sanctions by the CSRC, which may include fines and penalties, limitations on our operating privileges in China, restrictions on or prohibition of the payments or remittance of dividends by our subsidiaries in China, restrictions on or delays to our future overseas securities offerings, or other actions that could have a material and adverse effect on our business, financial condition, results of operations, reputation and prospects, as well as the trading price of the Ordinary Shares.

We cannot guarantee that new rules or regulations promulgated in the future will not impose any additional requirement on us. If there are any other approvals, filings and/or other administration procedures to be obtained from or completed with any other PRC regulatory authorities as required by any new laws and regulations for any of our future proposed offering of securities overseas, we cannot assure you that we can obtain the required approval or complete the required filings or other regulatory procedures in a timely manner, or at all. Any failure to obtain the relevant approvals or complete the filings and other relevant regulatory procedures may subject us to regulatory actions or other sanctions from such PRC regulatory authorities, which may have a material adverse effect on our business, financial condition or results of operations.

***The continued U.S. regulatory and legislative focus, including the enactment of the HFCAA, may adversely affect the market price of our Ordinary Shares and may eventually require us to delist our securities from the U.S. markets.***

Trading in our securities on U.S. markets, including the Nasdaq, may be prohibited under the HFCAA if the PCAOB determines that it is unable to inspect or investigate completely our auditor for two consecutive years.

On December 16, 2021, the PCAOB issued a report to notify the SEC of its determination that it was unable to inspect or investigate completely the registered public accounting firms headquartered in mainland China and Hong Kong.

On August 26, 2022, the PCAOB signed a Statement of Protocol with the CSRC and MOF, which established a specific, accountable framework to make possible complete inspections and investigations by the PCAOB of audit firms based in mainland China and Hong Kong, as required under U.S. law. On December 15, 2022, the PCAOB issued a report that vacated its December 16, 2021 determination and removed mainland China and Hong Kong from the list of jurisdictions where it is 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.

Our auditor, WWC, P.C., has been inspected by the PCAOB on a regular basis, with the last inspection completed in 2023, and it is not subject to the determinations announced by the PCAOB on December 16, 2021. However, whether the PCAOB will continue to conduct inspections and investigations completely to its satisfaction 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, including positions taken by authorities of the PRC and the PCAOB. The PCAOB is expected to continue to demand complete access to inspections and investigations against accounting firms headquartered in mainland China and Hong Kong in the future. The PCAOB is required under the HFCAA to make its determination on an annual basis with regard to its ability to inspect and investigate completely accounting firms based in mainland China and Hong Kong. The possibility of being a "Commission-Identified Issuer" and the risk of delisting could continue to adversely affect the trading price of our securities. If the PCAOB determines in the future that it no longer has full access to inspect and investigate accounting firms headquartered in mainland China and Hong Kong and we continue to use such accounting firms to conduct audit work, we would be identified as a "Commission-Identified Issuer" under the HFCAA following the filing of the annual report for the relevant fiscal year, and if we were so identified for two consecutive years, trading in our securities on U.S. markets would be prohibited.

***Recent greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business and our offering.***

On June 10, 2021, the Standing Committee of the National People's Congress of China, or the SCNPC, promulgated the PRC Data Security Law, which came into effect in September 2021. The PRC Data Security Law imposes data security and privacy obligations on entities and individuals carrying out data activities, and introduces a data classification and hierarchical protection system based on the importance of data in economic and social development, as well as the degree of harm it will cause to national security, public interests, or legitimate rights and interests of individuals or organizations when such data is tampered with, destroyed, leaked, or illegally acquired or used. The PRC Data Security Law also provides for a national security review procedure for data activities that may affect national security and imposes export restrictions on certain data and information.

On August 20, 2021, the SCNPC promulgated the PRC Personal Information Protection Law, or the PIPL, which came into effect in November 2021. In addition to other rules and principles of personal information processing, the PIPL specifically provides rules for processing sensitive personal information. Sensitive personal information refers to personal information that, once leaked or illegally used, could easily lead to the infringement of human dignity or harm to the personal or property safety of an individual, including biometric recognition, religious belief, specific identity, medical and health, financial account, personal whereabouts and other information of an individual, as well as any personal information of a minor under the age of 14. Only where there is a specific purpose and sufficient necessity, and under circumstances where strict protection measures are taken, may personal information processors process sensitive personal information. A personal information processor shall inform the individual of the necessity of processing such sensitive personal information and the impact thereof on the individual's rights and interests. As uncertainties remain regarding the interpretation and implementation of the PIPL, we cannot assure you that we will comply with the PIPL in all respects and regulatory authorities may order us to rectify.

On November 14, 2021, the CAC released the Draft Network Data Security Regulations for public commenting until December 13, 2021, which provides that data processing operators engaging in data processing activities that affect or may affect national security must be subject to network data security review by the CAC. According to the Draft Network Data Security Regulations, data processing operators who possess personal data of at least one million users or collect data that affects or may affect national security must be subject to network data security review by the CAC.

On December 28, 2021, together with 12 other regulatory authorities jointly promulgated the amended Cybersecurity Review Measures, which came into effect on February 15, 2022. The amended Cybersecurity Review Measures provide that, in addition to CIIOs that intend to purchase internet products and services, internet platform operators engaging in data processing activities that affect or may affect national security must be subject to cybersecurity review by the CAC. According to the amended Cybersecurity Review Measures, a cybersecurity review assesses potential national security risks that may be brought about by any procurement, data processing, or overseas listing. The amended Cybersecurity Review Measures require that an internet platform operator who possesses the personal information of at least one million users must apply for a cybersecurity review by the CAC if it intends to be listed in foreign countries.

On September 28, 2023, the CAC enacted the Draft Data Export Regulations that proposed significant changes to the cross-border data transfer regime. This update to China's cybersecurity and data protection regulatory landscape try to relax some of the obligations, such as exempting personal information handlers from certain safeguarding measures if they handle data for less than 10,000 individuals per year. Basically, this would reduce the regulatory burden on smaller enterprises who deal with less sensitive data.

In December 2023, the CAC released the Cybersecurity Incident Reporting Draft Measures. These are measures that are aimed at standardizing how cybersecurity incidents are reported, showing China's broader effects to enhance data security and ensure timely responses to cyber threats.

Furthermore, on September 24, 2024, the State Council promulgated the Regulations on the Network Data Security Management (the "Network Data Regulation"), which became effective on January 1, 2025. The Network Data Regulation restates and further specifies the legal requirements for personal information, important data, cross-border data transfer, network platform services, and data security. Among others, if the network data processing activities have or may have impacts on national security, such activities shall be subject to national security review in accordance with relevant laws and regulations.

As of the date of this annual report, we have not been subject to any material claims, investigations or legal proceedings settled, pending or threatened for any material noncompliance with or violations of applicable PRC laws and regulations with respect to privacy and personal data protection and have not received any cybersecurity-related warning or sanction from the PRC regulatory authorities, or any notice from relevant authorities requiring us to file for a cybersecurity review. We believe we and our PRC subsidiaries are not subject to the cybersecurity review by the CAC since our PRC subsidiaries are not CIIOs or internet platform operators that possess personal information of more than one million users or engage in data processing activities that affect or may affect national security. However, the relevant PRC regulatory authorities may take a view that is contrary to or otherwise different from the opinion stated above.

As uncertainties remain regarding the interpretation and implementation of these laws and regulations, we cannot assure you that we will comply with such regulations in all respects, and we may be ordered to rectify or terminate any actions that are deemed illegal by regulatory authorities. We may also become subject to fines and/or other sanctions which may have material adverse effect on our business, operations and financial condition.

***We may rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business.***

We are a Cayman Islands holding company and we rely principally on dividends and other distributions on equity from our PRC subsidiaries for our cash and financing requirements, including the funds necessary to pay dividends and other cash distributions to our shareholders and services of any debt we may incur. Our PRC subsidiaries' ability to distribute dividends is based upon its distributable earnings. Current PRC regulations permit our PRC subsidiaries to pay dividends to their respective shareholders only out of their accumulated profits, if any, determined in accordance with PRC accounting standards and regulations. In addition, each of our PRC subsidiaries is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital. These reserves are not distributable as cash dividends. If our PRC subsidiaries incur debt on their own behalf in the future, the instruments governing the debt may restrict their ability to pay dividends or make other payments to us.

To address the persistent capital outflow and the RMB's depreciation against the U.S. dollar, the People's Bank of China and the State Administration of Foreign Exchange, or the SAFE, have implemented a series of capital regulation measures since 2016. For instance, the Circular on Further Promoting the Reform of Foreign Exchange Management and Improving Authenticity and Compliance Review issued on January 18, 2017, provides that the banks shall, when dealing with dividend remittance transactions from domestic enterprise to its offshore shareholders of more than US$50,000, review the relevant board resolutions (or resolutions of partners), original tax filing form and audited financial statements of such domestic enterprise based on the principle of genuine transaction. The PRC government may strengthen its capital controls from time to time and our PRC subsidiaries' dividends and other distributions may be subject to tightened scrutiny in the future. Any limitation on the ability of our PRC subsidiaries to pay dividends or make other distributions to us could materially and adversely limit our ability to grow, make investments or acquisitions that could be beneficial to our business, pay dividends, or otherwise fund and conduct our business.

In addition, the EIT Law and its implementation rules provide that a withholding tax at a rate of 10% will be applicable to dividends payable by PRC enterprises to non-PRC resident enterprises unless reduced under treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC resident enterprises are tax resident.

***You may experience difficulties in effecting service of legal process, enforcing foreign judgments or bringing actions in China against us or our management named in this annual report based on foreign laws.***

All of our business and operations are located in the PRC. In addition, all of our directors and executive officers reside within China and are PRC nationals. All of their assets are located outside of the United States. As a result, it may be difficult for investors to effect service of process upon us or those persons inside China.

The recognition and enforcement of foreign judgments are basically provided for under the PRC Civil Procedures Law. PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedures Law and other applicable laws and regulations based either on treaties between China and the country where the judgment is made or on principles of reciprocity between jurisdictions. China does not have treaties providing for the reciprocal recognition and enforcement of judgments of courts with the United States, the Cayman Islands or many other countries and regions. Therefore, recognition and enforcement in China of judgments of a court in any of these non-PRC jurisdictions in relation to any matter not subject to a binding arbitration provision may be difficult or impossible. In addition, according to the PRC Civil Procedures Law, the PRC courts will not enforce a foreign judgment if it is decided as having violated the basic principles of PRC laws or national sovereignty, security or public interest. As a result, it is uncertain whether and on what basis a PRC court would enforce a judgment rendered by a court in the United States or the Cayman Islands.

The SEC, U.S. Department of Justice and other U.S. authorities often have substantial difficulties in bringing and enforcing actions against non-U.S. companies and non-U.S. persons, including company directors and officers, in certain emerging markets, including China. Legal and other obstacles to obtaining information needed for investigations or litigation or to obtaining access to funds outside the United States, lack of support from local authorities, and other various factors make it difficult for the U.S. authorities to pursue actions against non-U.S. companies and individuals, who may have engaged in fraud or other wrongdoings. Additionally, public shareholders investing in the Ordinary Shares have limited rights and few practical remedies in emerging markets where we operate, as shareholder claims that are common in the United States, including class actions under securities law and fraud claims, generally are difficult or impossible to pursue as a matter of law or practicality in many emerging markets, including China. As a result of all of the above, you may have more difficulties in protecting your interests in your emerging market investments.

***It may be difficult for overseas regulators to conduct investigations or collect evidence within China.***

Shareholder claims that are common in the United States, including securities law class actions and fraud claims, generally are difficult to pursue as a matter of law or practicality in China. For example, in China, there are significant legal and other obstacles to obtaining information needed for shareholder investigations or litigation outside China or otherwise with respect to foreign entities. Although the local authorities in China may establish a regulatory cooperation mechanism with the securities regulatory authorities of another country or region to implement cross-border supervision and administration, such regulatory cooperation with the securities regulatory authorities in the Unities States have not been efficient in the absence of a mutual and practical cooperation mechanism. According to Article 177 of the PRC Securities Law which became effective in March 2020, no overseas securities regulator is allowed to directly conduct investigation or evidence collection activities within the territory of the PRC. While detailed interpretation of or implementation of rules under Article 177 have yet to be promulgated, the inability for an overseas securities regulator to directly conduct investigation or evidence collection activities within China may further increase difficulties faced by you in protecting your interests.

***Fluctuations in currency exchange rates could have a material and adverse effect on the value of your investment.***

Our revenue and expenses have been and are expected to continue to be primarily denominated in RMB, and we are exposed to the risks associated with the fluctuation in the currency exchange rate of RMB. Should RMB appreciate against other currencies, the value of the proceeds from any future financings, which are to be converted from US dollar or other currencies into RMB, would be reduced and might accordingly hinder our business development due to the lessened amount of funds raised. On the other hand, in the event of the devaluation of RMB, the dividend payments of our Company, which are to be paid in US dollars after the conversion of the distributable profit denominated in RMB, would be reduced. Hence, substantial fluctuation in the currency exchange rate of RMB may have a material adverse effect on our business, operations and financial position and the value of your investment in the ordinary shares.

***Governmental regulations on currency conversion may limit our ability to utilize our revenues effectively and affect the value of your investment.***

The PRC government imposes regulations on the convertibility of the renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. We receive all of our revenues in RMB. Under our current corporate structure, our Cayman Islands holding company primarily relies on dividend payments from our PRC subsidiaries to fund any cash and financing requirements we may have. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of the SAFE by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, without prior approval of the SAFE, cash generated from the operations of our PRC subsidiaries in China may be used to pay dividends to our Company. However, approval from or registration with appropriate government authorities is required where RMB is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. As a result, we need to obtain the SAFE approval to use cash generated from the operations of our PRC subsidiaries to pay off their respective debt in a currency other than renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency other than RMB. Access to foreign currencies for current account transactions may be further restricted in the future as the applicable laws, regulations and policies evolve. If the foreign exchange regulation system prevents us from obtaining sufficient foreign currencies to satisfy our foreign currency demands, we may not be able to pay dividends in foreign currencies to our shareholders.

***Changes in PRC political, economic and governmental policies may have an adverse impact on our business.***

We conduct all of our operations in China and all of our revenue is derived from our operations in China. Accordingly, our results of operations and prospects are, to a significant degree, subject to economic, political and legal developments in China. The economy of China differs from the economies of most developed countries in many respects, including its level of development, its growth rate and its control over foreign exchange. In addition, the PRC government continues to play a significant role in regulating industrial development. It also has significant influence over China's economic growth through the allocation of resources, controlling payment of foreign currency-denominated obligations, setting monetary policies, restricting the inflow and outflow of foreign capital and providing preferential treatment to particular industries or companies. The PRC government also has significant authority to exert influence on the ability of a China-based company, such as our company, to conduct its business.

The global macroeconomic environment faces significant challenges in the near-term future. For example, there is considerable uncertainty about the short and long-term economic impact of the monetary and fiscal policies adopted by the central banks and government authorities of some of the world's leading economies, including but not limited to the United States and China. There are also material concerns about the current and future relationship between the United States and China. Deterioration in political conditions and abrupt changes in Sino-U.S. relations are difficult to predict and could adversely affect China's overall economic and market conditions and consequently our business, operating results and financial condition. Moreover, any ongoing controversies between the United States and China, whether or not related to our business, could cause investors to be unwilling to hold or buy the Ordinary Shares and consequently cause the trading price of the Ordinary Shares to decline. The various economic and policy measures enacted by the PRC government to forestall economic downturns or bolster China's economic growth could materially affect our business. Any adverse change in the economic conditions in China, policies of the PRC government or laws and regulations in China could have a material adverse effect on the overall economic growth of China and, in turn, our business.

***Failure to comply with PRC laws and regulations related to labor and employee benefits may subject us to penalties or additional cost.***

Companies operating in China are required to comply with various laws and regulations related to labor and employment benefits. For example, companies are required to participate in various government-sponsored employee benefit plans, including certain social insurance, housing provident funds and other welfare-oriented payment obligations, and contribute to the plans in amounts equal to certain percentages of salaries, including bonuses and allowances, of employees up to a maximum amount specified by the local government from time to time at locations where our employees are based. The requirement of employee benefit plans has not been implemented consistently by the local governments in China given the different levels of economic development in different locations. Apart from that, if a company intends to adopt flexible working hour arrangement and comprehensive working hour scheme, it shall fulfill the requirements in relevant regulations, and make filings with labor authorities, or the company will be subject to penalties and may be required to pay extra fees to its employees.

We cannot assure you that we will be able to comply with all labor-related law and regulations, including those relating to obligations to make social insurance payments, contribute to the housing provident funds, as well as make all filing for comprehensive working hour scheme. Our failure to make contributions to various employee benefit plans and in complying with applicable PRC labor-related laws may subject us to fines, penalties, government investigations or labor disputes and we could be required to make up the contributions for these plans as well as to pay late fees and fines, which may adversely affect our financial condition and results of operations.

***The PRC Labor Contract Law, increased labor costs or other factors affecting our labor force in the PRC may adversely affect our business and results of operations.***

The currently effective PRC Labor Law was published on July 5, 1994 and latest amended on December 29, 2018. The PRC Labor Law has sets forth restrictions and increases the costs involved with dismissing employees and established the minimum wage guarantee system. All of our workforce is employed in China where the average labor cost has been steadily increasing over the past years as a result of inflation, government-mandated wage increases and other changes in labor laws and local economics. Further changes in the labor laws, rules and regulations may be promulgated by the PRC government in the future and our operations may be materially and adversely affected if such laws, rules or regulations impose additional burden on the employers. The labor cost will continue to increase in the future which is in line with the economic growth in China. Competition for employees would require us to pay higher wages, which would result in higher labor costs.

***PRC regulation of loans to, and direct investment in, PRC entities by offshore holding companies may delay or prevent us from using the proceeds from any future financings to make loans or additional capital contributions to our PRC subsidiaries, which could materially and adversely affect our liquidity and our ability to fund and expand our business.***

According to the Guidelines on Foreign Exchange Business under Capital Account (2024 Edition) issued by the SAFE, which came into effect on May 6, 2024, as well as other regulatory principles, the funds raised by domestic companies through overseas offerings should be repatriated to China in a timely manner, either in RMB or in foreign currency. Therefore, we have to comply with these requirements in connection with any future offering and PRC residents who are or become our shareholders or beneficial owners would also have to comply with these requirements.

We may make loans to our PRC subsidiaries subject to the approval from governmental authorities and limitation of amount, or we may make additional capital contributions to our PRC subsidiaries in China. Any loans to our PRC subsidiaries in China, which are treated as FIEs under PRC laws, are subject to PRC regulations and foreign exchange loan registrations. For example, any loans to our PRC subsidiaries, which are FIEs, cannot exceed a statutory limit, and shall be filed with the SAFE or its local counterparts through the online filing system of SAFE after the loan agreement is signed and at least three business days before the borrower withdraws any amount from the foreign loan. Furthermore, if we provide our PRC subsidiaries with capital contributions, such PRC subsidiaries are required to apply for registrations with the State Administration for Market Regulation, or the SAMR or its local branches, submit a change report to the MOFCOM or its local counterpart through the online enterprise registration system, and complete the exchange registration with qualified banks.

In light of the various requirements imposed by PRC regulations on loans to and direct investment in PRC entities by offshore holding companies, we cannot assure you that we will be able to complete the necessary government registrations or obtain the necessary government approvals on a timely basis, if at all, with respect to future loans to our PRC subsidiaries or future capital contributions by us to our wholly foreign-owned subsidiaries in China. As a result, uncertainties exist as to our ability to provide prompt financial support to our PRC subsidiaries when needed. If we fail to complete such registrations or obtain such approvals, our ability to use the proceeds we expect to receive from any future offering and to capitalize or otherwise fund our PRC operations may be negatively affected, which could materially and adversely affect our liquidity and our ability to fund and expand our business.

***Certain PRC regulations may make it more difficult for us to pursue growth through acquisitions.***

The Regulations on Mergers of Domestic Enterprises by Foreign Investors, or the M&A Rules, established specific procedures and requirements for merger and acquisition activities by foreign investors. Such regulation requires, among other things, that the MOFCOM be notified in advance of any change of control transaction in which a foreign investor takes control of a PRC domestic enterprise, if (i) any important industry is concerned, (ii) such transaction involves factors that have or may have impact on the national economic security, or (iii) such transaction will lead to a change in control of a domestic enterprise which holds a famous trademark or PRC time-honored brand. Moreover, the Anti-Monopoly Law promulgated by the SCNPC, which became effective in 2008 and last amended in 2022 requires that transactions which are deemed concentrations and involve parties with specified turnover thresholds must be cleared by the relevant anti-monopoly authority before they can be completed. We may pursue potential strategic acquisitions that are complementary to our business and operations. Complying with the requirements of these regulations to complete such transactions could be costly, and any required approval processes, including obtaining approval or clearance from the competent governmental authority, may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or maintain our market share.

***We may be classified as a PRC resident enterprise for PRC enterprise income tax purposes, which could result in unfavorable tax consequences to us and our shareholders.***

Under the EIT Law and its implementation rules, an enterprise established outside of the PRC with its "de facto management body" within the PRC is considered a "resident enterprise" and will be subject to enterprise income tax on its global income at the rate of 25%. The implementation rules define the term "de facto management body" as the body that exercises full and substantial control and overall management over the business, productions, personnel, accounting and properties of an enterprise. The State Administration of Taxation ("SAT") issued the Notice Regarding the Determination of Chinese-Controlled Offshore-Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies, or SAT Circular 82, on April 22, 2009 and last amended on December 29, 2017. SAT Circular 82 provides certain specific criteria for determining whether the "de facto management body" of a PRC-controlled enterprise that is incorporated offshore is located in China. Although this circular only applies to offshore enterprises controlled by PRC enterprises or PRC enterprise groups, not those controlled by PRC individuals or foreigners, the criteria set forth in the circular may reflect the SAT's general position on how the "de facto management body" text should be applied in determining the tax resident status of all offshore enterprises. According to SAT Circular 82, an offshore incorporated enterprise controlled by a PRC enterprise or a PRC enterprise group will be regarded as a PRC tax resident by virtue of having its "de facto management body" in China, and will be subject to PRC enterprise income tax on its global income only if all of the following conditions are met (i) the primary location of the day-to-day operational management is in the PRC; (ii) decisions relating to the enterprise's financial and human resource matters are made or are subject to approval by organizations or personnel in the PRC; (iii) the enterprise's primary assets, accounting books and records, company seals, and board and shareholder resolutions are located or maintained in the PRC; and (iv) at least 50% of voting board members or senior executives habitually reside in the PRC.

Further to SAT Circular 82, on July 27, 2011, the SAT issued the Administrative Measures for Enterprise Income Tax of Chinese-Controlled Offshore Incorporated Resident Enterprises (Trial), or SAT Circular 45, to provide more guidance on the implementation of SAT Circular 82; the circular became effective on September 1, 2011 and revised on June 15, 2018. SAT Circular 45 clarified certain issues in the areas of resident status determination, post-determination administration and competent tax authorities' procedures.

We believe our Company is not a PRC resident enterprise for PRC tax purposes. However, the tax resident status of an enterprise is subject to determination by the PRC tax authorities and uncertainties remain with respect to the interpretation of the term "de facto management body." If the PRC tax authorities determine that our Company or any of our offshore subsidiaries is a PRC resident enterprise for enterprise income tax purposes, our Company or the relevant offshore subsidiaries will be subject to PRC enterprise income on its worldwide income at the rate of 25%. Furthermore, if we are treated as a PRC tax resident enterprise, we will be required to withhold a 10% tax from dividends we pay to our shareholders that are non-resident enterprises. In addition, non-resident enterprise shareholders may be subject to PRC tax at a rate of 10% on gains realized on the sale or other disposition of the Ordinary Shares, if such gain is treated as derived from a PRC source. Furthermore, if we are deemed a PRC resident enterprise, dividends paid to our non-PRC individual shareholders and any gain realized on the transfer of Ordinary Shares by such shareholders may be subject to PRC tax at a rate of 20% (which, in the case of dividends, may be withheld at source by us). These rates may be reduced by an applicable tax treaty, but it is unclear whether our non-PRC shareholders would, in practice, be able to obtain the benefits of any tax treaties between their country of tax residence and the PRC in the event that we are treated as a PRC resident enterprise. Any such tax may reduce the returns on your investment in the Ordinary Shares.

***PRC regulations relating to offshore investment activities by PRC residents may limit our PRC subsidiaries' ability to change their registered capital or distribute profits to us or otherwise expose us or our PRC resident beneficial owners to liability and penalties under PRC laws.***

In July 2014, the SAFE promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents' Offshore Investment and Financing and Roundtrip Investment Through Special Purpose Vehicles, or SAFE Circular 37. SAFE Circular 37 is applicable to our shareholders who are PRC residents and may be applicable to any offshore acquisitions that we make in the future.

SAFE Circular 37 requires registration with the SAFE or its local branches in connection with direct or indirect control of an offshore entity by PRC residents (including PRC individuals and PRC corporate entities). The term "control" under SAFE Circular 37 is broadly defined as the operation rights, beneficiary rights or decision-making rights acquired by PRC residents in the offshore special purpose vehicles by means of acquisition, trust, proxy, voting rights, repurchase, convertible bonds or other arrangements. In addition, any PRC resident who is a direct or indirect shareholder of an offshore special purpose vehicle is required to update its filed registration with the local branch of the SAFE with respect to that offshore special purpose vehicles to reflect any material change. On February 13, 2015, the SAFE promulgated a Notice on Further Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or SAFE Notice 13, which became effective on June 1, 2015. Under SAFE Notice 13, applications for foreign exchange registration of inbound foreign direct investments and outbound overseas direct investments, including those required under SAFE Circular 37, will be filed with qualified banks instead of the SAFE. The qualified banks will directly examine the applications and accept registrations under the supervision of the SAFE.

As of the date of this annual report, all of our shareholders who we are aware of being subject to the SAFE regulations have completed the initial registrations as required by SAFE Circular 37. We may not be informed of the identities of all the PRC residents holding direct or indirect interest in our Company, however, and we have no control over any of our future beneficial owners. Thus, we cannot provide any assurance that our current or future PRC resident beneficial owners will comply with our request to make or obtain any applicable registrations or continuously comply with all registration procedures set forth in these SAFE regulations. Such failure or inability of our PRC residents beneficial owners to comply with these SAFE regulations may subject us or our PRC resident beneficial owners to fines and legal sanctions, restrict our cross-border investment activities, or limit our PRC subsidiaries' ability to distribute dividends to or obtain foreign-exchange-dominated loans from us, or prevent us from being able to make distributions or pay dividends, as a result of which our business operations and our ability to distribute profits to you could be materially and adversely affected.

**Risks Related to Our Business and Industry**

***The PRC subsidiaries operate in a dynamic industry and have a limited operating history. Our historical results of operations and financial performance may not be indicative of future performance.***

As a company with a relatively limited operating history, our historical results may not be indicative of our future performance. We may not be successful in executing our growth strategy, and even if we achieve our strategic plan, we may not be able to sustain profitability. In future periods, our revenue could decline or grow more slowly than we expect. We may also incur significant losses in the future for a number of reasons, including as a result of the materialization of the following risks and the other risks described in this annual report, and we may encounter unforeseen difficulties, complications, delays and other unknown factors:

● we may be unsuccessful in predicting and capturing industry trends and consumer preferences;

● we may be unable to introduce new products that appeal to consumers;

● we may be unsuccessful in protecting or enhancing the recognition and reputation of our brand;

● we may be unsuccessful in competing for market share with our existing or new competitors;

● the ability of our third-party suppliers, manufacturers and logistics providers to produce and deliver our products in a timely way and subject to ever changing customer expectations could be disrupted;

● we may fail to adjust our sales and marketing strategies fast enough to stay current with consumers' behavioral changes in using internet and mobile devices;

● we may not be able to maintain and improve our customer experience;

● we may experience service interruptions, data corruption, cyber-based attacks or network security breaches which may result in the disruption of our operating systems;

● we may be unable to retain key members of our senior management team or attract and retain other qualified personnel;

● we may fail to successfully implement new business initiatives, especially expansion into new offerings or new business lines in which we have limited or no prior experience, including sustaining continued expansion of our business;

● we may fail to successfully expand our physical stores providing light beauty experience; and

● we may be affected by international trade tension and any adverse economic conditions in China or internationally.

We cannot be sure that we will be successful in addressing these and other risks and challenges we may face in the future. Any of these occurrences could have a material and adverse impact on our business, results of operations and financial condition. Our customer base may not continue to grow or may decline as a result of such risks. Any of these risks could cause our net sales growth to decline and may adversely affect our margins and profitability. Failure to continue our net sales growth or improve margins could have a material adverse effect on our business, financial condition, and results of operations. You should not rely on our historical rate of net sales growth as an indication of our future performance.

***We rely on the formulas provided by our third-party manufacturers.***

We engage and commission third-party manufacturers to produce our products and we rely on the third-party manufacturers to provide the formulas for our products. The standard form of Agreements of Commissioned Processing with our third-party manufacturers ("Agreement of Commissioned Processing") provides that, the third-party manufacturers engaged by us shall provide the formulas to be used in our products and a packaging material inspection report, produce a manufacture plan in written form, and manufacture and process our products that meet the relevant national standards, industry standards, and our requirements, as well as provide temporary storage of our products. The standard form of Agreements of Commissioned Processing also requires us to provide the third-party manufacturers with packaging materials that meet the requirements under applicable laws and regulations such as the Advertising Law and intellectual property regulations. Given our reliance on our third-party manufacturers to provide us with the formulas for our products and that we do not own the formulas, if we fail to enforce such agreements and if our competitors engage the same manufacturers and introduce the same or similar products at a significantly lower price in the same markets that we operate in, our results of operations may be adversely affected.

***The beauty industry is highly competitive. If we are unable to compete effectively, we may lose our market share and our business, results of operations and financial condition may be materially and adversely affected.***

We face vigorous competition from both domestic and international players in China in the beauty industry, including large multinational consumer products companies that own or operate multiple beauty brands. Competition in the beauty industry is intense and based on multiple factors, including the ability to launch new products, pricing of products, quality of products and packaging, brand awareness, perceived value and quality, innovation, offline sales capabilities, customers' functional and emotional satisfaction, promotional activities, advertising, editorials, e-commerce and mobile-commerce initiatives and other activities. We must compete with a high volume of new product introductions and a large number of existing products sold by diverse companies across several different distribution channels.

Many domestic and multinational consumer goods companies have greater financial, technical or marketing resources, longer operating histories, greater brand recognition or larger customer bases than we do and may be able to respond more effectively to changing business and economic conditions than we can. Despite our differentiated business model, existing and new players in the industry may also transform their business models and directly compete with us. Competitors may also roll out products targeting younger generations at a competitive price or adopt a price-cutting strategy for their current products to directly compete with us. Given the established sales network these large consumer goods companies maintain and the greater brand power they have, we cannot ensure that our existing customers will not allocate more market share to our competitor's products or cease to purchase products from us completely. Further, our competitors may attempt to gain market share by offering products at prices at or below the prices at which our products are typically offered. Competitive pricing may require us to reduce our prices, which would decrease our profitability or result in lost sales. Because many of our competitors have greater resources than we do, they may be able to better withstand these price reductions and loss of sales under a competitive pricing strategy.

It is difficult for us to predict the timing and scale of our competitors' activities in these areas or whether new competitors will emerge in the beauty industry. In addition, further technological breakthroughs, including new and enhanced technologies which increase competition in the online retail market, new product offerings by competitors and the strength and success of our competitors' marketing programs may impede our growth and the implementation of our business strategy.

Our ability to compete also depends on the continued strength of our brand and products, our ability to predict and capture industry trends and consumer preferences, the success of our marketing, innovation and execution strategies, the continued diversification of our product offerings, the successful management of new product introductions and innovations, strong operational execution, including in order fulfillment and supply chain management, and our success in entering new markets and expanding our business in existing geographies. If we are unable to continue to compete effectively, we may lose our market share and our business, results of operations and financial condition may be materially and adversely affected.

***Our success is dependent on the continued popularity of our products and our ability to anticipate and respond to changes in industry trends and consumer preferences and behavior in a timely manner.***

The success of our business and operations depends on our ability to continuously offer quality products that are attractive to consumers. The beauty industry is driven in part by fashion and beauty trends and consumer preferences and behavior, which may shift quickly and have been heavily affected by the rapidly increasing use and proliferation of social and digital media by consumers, and the speed with which information and opinions are shared. As industry trends and consumers' preferences and behavior continue to change, we must also continually work to develop, produce and market new products, maintain and enhance the recognition of our brand, achieve a favorable mix of products and refine our approach as to how and where we market and sell our products.

Our success depends on our products appeal to a broad range of consumers whose preferences and behavior cannot be predicted with certainty and may change rapidly, and on our ability to anticipate and respond in a timely and cost-effective manner to industry trends and consumer preferences and behavior through product innovations, product line extensions and marketing and promotional activities, among other things. We collect, store, process and use a variety of customer data and information for analysis of the changing consumer preferences and fashion trends to guide our product development and to improve our products and customer experience, and to predict and react to industry trends and consumers' preferences and behavior effectively and efficiently. However, we cannot assure you that we will be able to successfully anticipate and respond to consumers' preferences and behavior at all times, especially as we continue to broaden our customer base and diversify our product offerings aimed at customers with differing characteristics. If we are unable to anticipate and respond to the changes in industry trends and consumer preferences and behavior, we may fail to continuously develop products with wide market acceptance, capture emerging growth opportunities, adopt competitive sales strategies for our existing products, or properly predict and manage our inventory. Such failure could also negatively impact our brand image and result in diminished customer experience and brand loyalty. Any of these occurrences could materially and adversely affect our business, prospects and results of operations.

***Our new product introductions may not be as successful as we anticipate, which could have a material adverse effect on our business, prospects, financial condition and results of operations.***

Fast-evolving beauty trends, and consumer preferences have shortened the life cycles of beauty products and required us to continually work to develop, produce and market new products, maintain and enhance the recognition of our brand and shorten our product development and supply chain cycles. Our continued success depends on our ability to develop and launch products in a timely and cost-effective manner in response to beauty industry trends, consumer preferences for beauty products and consumer attitudes toward our industry and brand. If we do not successfully and consistently develop new products that appeal to our customers our total revenue and margins could suffer.

We have an established process for the development, evaluation and validation of our new product concepts. Nonetheless, each new product launch involves risks, as well as the possibility of unexpected consequences. For example, the acceptance of new product launches and sales to our customers may not be as high as we anticipate, due to a lack of acceptance of the products themselves or their price, or the limited effectiveness of our marketing strategies. The introduction of new products targeted at expanding our product reach beyond our current customer base may not be as successful as we anticipate due to insufficient data insights on and understanding about the preferences, trends and behaviors of such new customer group. Our ability to launch new products may be limited by delays or difficulties affecting the ability of our suppliers or manufacturers to timely manufacture new products. In addition, we may experience a decrease in sales of certain existing products as a result of newly launched products. Also, product innovation may place a strain on our employees and our financial resources, including incurring expenses in connection with product innovation and development, marketing and advertising that are not subsequently supported by a sufficient level of sales. Further, sales of new products may be affected by the efficacy of our inventory management and quality of delivery and order fulfillment services provided by our logistics providers, and we may experience product shortages and delayed or defective or improper product delivery. Any of these occurrences could delay or impede our ability to achieve our sales objectives, which could have a material adverse effect on our business, financial condition and results of operations.

As part of our ongoing business strategy, we expect to continue introducing new skincare products while expanding our product launches into adjacent categories that target eye and lip care, in which we may have little or no prior operating experience. The success of product launches in adjacent product categories could be hampered by our relative inexperience operating in such categories, the strength of our competitors or any of the other risks referred to above. Furthermore, any expansion into new product categories may subject us to additional operational and financial constraints which could inhibit our ability to accomplish such expansion. If we fail to continue to roll out commercially successful products in our traditional categories or in adjacent categories, our business, financial condition and results of operations may be materially and adversely affected.

***Our business depends, in part, on the quality, effectiveness and safety of our products.***

Any loss of confidence on the part of consumers in the ingredients used in our products, whether related to product contamination or product safety or quality failures, actual or perceived, or inclusion of prohibited or restricted ingredients or an improper mixture of ingredients, could tarnish the image of our brand and could cause consumers to choose other products. Allegations of contamination or other adverse effects on product safety or suitability for use by a particular consumer, even if untrue, may require us to expend significant time and resources responding to such allegations and could, from time to time, result in the suspension of sales or a recall of a product from any or all of the markets in which the affected product was distributed. Any such issues or recalls could negatively affect our profitability and brand image.

If our products are found to be, or perceived to be, defective or unsafe, or if they otherwise fail to meet our consumers' expectations, our relationships with consumers could suffer, the appeal of our brand could be diminished, we may need to recall some of our products and/or become subject to regulatory action, and we could lose sales or market share or become subject to boycotts or liability claims. In addition, safety or other defects in our competitors' products could reduce consumer demand for our products if consumers view them to be similar. Any of these outcomes could result in a material adverse effect on our business, financial condition and results of operations.

***We may not be able to successfully implement our growth strategy.***

Our future growth, profitability and cash flows depend upon our ability to successfully implement our business strategy, which, in turn, is dependent upon a number of factors, including our ability to:

● build a strong and well-recognized brand;

● further penetrate our targeted markets by attracting new consumers and retaining and further engaging our existing customers;

● capture the industry trends and develop and launch new products and expand into relevant adjacencies in answer to such trends;

● continue to use innovation to drive sales, improve technological and operational efficiencies-and improve profit margin;

● enhance Removed our market study and ability to predict and follow customers' preferences, trends and behaviors;

● effectively manage the quality and efficiency of the third-party manufacturing partners and packaging supply partners and logistics and other third-party service providers' performance;

● continue to broaden and diversify our distribution channels;

● pursue strategic investments and collaborations to complement our existing capabilities and geographic reach; and

● leverage our high-performance team culture to drive margins.

There can be no assurance that we can successfully achieve any or all of the above initiatives in the manner or time period that we expect. Further, achieving these objectives will require investments which may result in short-term costs without generating any current net sales and therefore may be dilutive to our earnings. We cannot provide any assurance that we will realize, in full or in part, the anticipated benefits we expect our strategy will achieve. The failure to realize those benefits could have a material adverse effect on our business, financial condition and results of operations.

***We may be unable to manage our growth effectively or efficiently.***

Growing our business rapidly may place a strain on our management team, financial and information systems, supply chain and distribution capacity and other resources. To manage growth effectively, we must continue to enhance our operational, financial and management systems, including our warehouse management and inventory control; maintain and improve our internal controls and disclosure controls and procedures; maintain and improve our information technology systems and procedures; and expand, train and manage our employee base.

We may not be able to effectively manage our expansion in any one or more of these areas, and any failure to do so could significantly harm our business, financial condition and results of operations. Growing our business rapidly may make it difficult for us to adequately predict the expenditures we may need to make in the future. If we do not make the necessary overhead expenditures to accommodate our future growth, we may not be successful in executing our growth strategy, and our results of operations would suffer.

***If we are unable to provide superior customer experiences, our business and reputation may be materially and adversely affected.***

The success of our business hinges on our ability to provide superior customer experience, which in turn depends on a variety of factors. These factors include our ability to bring innovative products to the market at competitive prices that respond to consumer demands and preferences, our ability to fit in the lifestyle of our customers and deeply engage with our customers. These factors also include our ability to maintain the quality of our products and services, provide timely and reliable delivery and responsive and superior before- and after-sales service. In addition, we have made efforts to maintain a superior customer experience that is driven by our relentless efforts to maintain product quality and curate our products offerings so they are responsive to industry trends and customers' preferences. Similarly, we substantially focus on to providing quality and responsive customer service.

Although we provide standardized employee conduct training and beauty product training for all our beauty advisors and maintain a detailed employee handbook regulating employee conduct, there is no assurance that our beauty advisors will provide consistently satisfactory customer service to our customers. In addition, as our network of beauty advisors continues to rapidly expand along with our growth, it may be harder for us to manage our advisors and ensure the quality of services they provide to our customers. Any negative customer service experience with our beauty advisors either offline in our physical stores or online through our customer communities or one-on-one chats may discourage customers from purchasing our products and adversely affect our reputation and brand image.

If our customer service representatives fail to provide satisfactory service, or if waiting times are too long due to the high volume of calls from customers at peak times, our brand and customer loyalty may be adversely affected. There is no assurance that we will be able to maintain a low turnover rate of existing employees and provide sufficient training to new employees to meet our standards of customer service or that an influx of less experienced personnel will not dilute the quality of our customer service. In addition, any negative publicity or poor feedback regarding our customer service may harm our brand and reputation and in turn cause us to lose customers and market share.

***Our PRC subsidiaries have incurred significant costs for a variety of sales and marketing efforts, including social media-based advertising and heavy promotions to attract customers through multiple sales channels. If we are unable to conduct sales and marketing efforts in a cost-effective and efficient manner, our results of operations and financial conditions may be materially and adversely affected.***

As a relatively young company, we have invested, and will continue to invest, a large amount of financial and other resources in promoting our brand awareness and acquiring customers, including expanding our marketing and sales teams or campaigns, and purchasing advertisements.

Our marketing and branding activities may not be well received, successful or cost-effective, which may lead to significantly higher marketing expenses in the future. We may not be able to continue our existing marketing and branding activities, or successfully identify and utilize new marketing strategy trends, sales channels and approaches that appeal to or fit in the lifestyle of our targeted customers. We may also fail to adjust our sales and marketing strategies fast enough to stay current with consumers' behavioral changes in using the internet and mobile devices. Failure to refine our existing marketing strategies or introduce new effective marketing strategies in a cost-effective manner could negatively impact our business, results of operations and financial condition. In addition, failure to comply with relevant provisions of the Advertising Law of the PRC, the Supervision Regulations and other relevant laws and regulations will result in the restriction, inhibition or delay of our ability to sell products.

***Our business is subject to complex and evolving product safety laws, regulations and standards. If we fail to comply with these laws, regulations and safety standards or if our products otherwise have defects, we may be required to recall products and may face penalties and product liability claims, either of which could result in unexpected costs and damage our reputation.***

The manufacturing, distribution and packaging of beauty products and their components, ingredients and raw materials are subject to complex product safety-related laws, regulations and national and industrial standards. To maintain compliance and promote product safety, we have established a team dedicated to product quality inspection, product sampling and quality issues resolution and cooperate with qualified testing centers to continually oversee the quality and safety of our products. In addition, we closely work with our counsel to monitor the development of laws, regulations and standards applicable to our business. However, certain of these laws, regulations and standards are relatively new and because their interpretation and implementation are evolving, we cannot assure you that the competent authorities will always hold the same view as our counsel does in terms of the compliance of our business operations.

Any failure or perceived failure to comply with laws, regulations or standards with respect to product safety, or any sale suspension or product recall may lead to government investigations of us, penalties and lawsuits against us which may result in adverse publicity. Furthermore, we may experience significant costs in connection with the suspension of sales or recall, litigation, investigations or penalties which could have a material and adverse effect on our business, financial condition and results of operations.

***Our operating results could be materially harmed if we are unable to accurately forecast consumer demand for our products or adequately manage our inventory.***

Our business requires us to manage a large volume of inventory effectively. Due to the particularity of the cosmetics industry, the storage and distribution of cosmetics production enterprises must meet timeliness requirements and monitor the uncertainty of terminal demand. Because we must maintain a certain inventory of the products, we depend on our forecasts of product demand for, and popularity of various products to make purchasing decisions to manage our inventory. If we subsequently fail to effectively manage our inventory, there may be a risk of inventory loss.

The demand for our inventory of products can change significantly between the time that components, ingredients or raw materials are ordered and the date of sale. Demand may be affected by seasonality, new product launches, rapid changes in product cycles and pricing, product defects, promotions, changes in consumer spending patterns, changes in consumer tastes with respect to our products and other factors, and our consumers may not purchase products in the quantities that we expect. It may be difficult to accurately forecast demand and determine appropriate levels of product or componentry.

We must maintain a certain inventory of their products to ensure products do not expire or reach the end of the period of validity. The period of validity of cosmetics is more strictly controlled than that of general merchandise and cosmetics close to the period of validity will be destroyed after relevant procedures are performed. Generally, we do not have the right to return unsold products to the third-party manufacturing partners and third-party packaging supply partners. If we fail to manage our inventory effectively or negotiate favorable credit terms with third-party manufacturers and suppliers, we may be subject to a heightened risk of inventory obsolescence, a decline in inventory values, and significant inventory write-downs or write-offs in the case of overestimation of consumer demand, or increased costs to secure necessary production and delivery delays in the case of underestimation of consumer demand. An inability to meet consumer demand and delays in the delivery of our products to our customers could result in reputational harm and damaged customer relationships. In addition, if we are required to lower sale prices in order to incentivize sales to reduce our inventory levels, our profit margins might be negatively affected. Any of the above may materially and adversely affect our business, financial condition and results of operations.

***We rely on third-party service providers for logistics services. If these service providers fail to provide reliable services, our business and reputation may be adversely affected.***

We rely on third-party couriers and logistics providers for order fulfillment and delivery services, including, among others, collection of products, warehousing services, shipping products to customers, stores and designated warehouse and handling product returns. While these arrangements allow us to focus on our central business, they reduce our direct control over the logistics services provided to our customers. Logistics in our primary locations or transit to final destinations may be disrupted for a variety of reasons, including events that are beyond our control or the control of these service providers, such as inclement weather, natural and man-made disasters, health epidemics, information technology system failures, transportation disruptions, labor unrest, commercial disputes, military actions or economic, business, labor, environmental, public health, or political issues. In addition, if our third-party logistics service providers fail to comply with applicable rules and regulations in China, our delivery services may be materially and adversely affected. If any of our service providers' operations or services are disrupted or terminated, we may not be able to find alternative service providers with quality and on commercial terms to our satisfaction in a timely and reliable manner, or at all. Furthermore, delivery personnel of contracted third-party logistics service providers act on our behalf and interact with our customers personally. We need to effectively manage these third-party logistics service providers to ensure the quality of customer services.

If our products are not delivered in the proper condition or in a timely manner or there is any other failure to provide high-quality delivery services to our customers, our products may be compromised, customer experience may be impaired and, as a result, our business and reputation could suffer. Further, if our logistics providers raise their fee rate, we may incur additional costs and may not be able to pass such costs to our customers.

***Our delivery, return and exchange policies may adversely affect our results of operations.***

We have adopted shipping policies that do not necessarily pass the full cost of shipping onto our customers. We also have adopted customer-friendly return and exchange policies that make it convenient and easy for customers to change their minds within seven days after completing direct online purchases from us. We may also be legally required to adopt new or amend existing return and exchange policies from time to time. These policies improve customers' shopping experience and promote customer loyalty, which in turn helps us acquire and retain customers. However, these policies also subject us to additional costs and expenses which we may not recoup through increased revenues. If our delivery, return and exchange policies are misused by a significant number of customers or if the return or exchange rates increase beyond historical records or otherwise substantially then our costs may increase significantly, and our results of operations may be materially and adversely affected.

If we revise our shipping policies to reduce our costs and expenses, our customers may be dissatisfied. Our customers dissatisfaction may result in the loss of their business or our failure to acquire new customers at a desirable pace, which may materially and adversely affect our results of operations.

***Failure to successfully lease suitable warehouse facilities or any interruption in the operation of the warehouse for an extended period may negatively affect the business and results of operations.***

We believe that our warehouse, located in Wuxi, Jiangsu Province, PRC is essential to our supply chain management. We cannot assure you that we will be able to add suitable warehouse facilities on commercially acceptable terms or at all. In addition, our ability to process and fulfill orders accurately depends on the smooth operation of the warehouse facilities. The warehouse may be vulnerable to damage caused by fire, flood, power outage, telecommunications failure, break-ins, earthquake, health epidemics, human error and other events. If the warehouse were rendered incapable of operations, then we may be unable to fulfill our orders on a timely basis, which could result in canceled sales and a loss of customer loyalty and have a material adverse impact on our business, financial condition and results of operations. We do not carry business interruption insurance, and the occurrence of any of the foregoing risks could have a material adverse effect on our business, prospects, financial condition and results of operations.

***Our business expansion has required and will continue to require a substantial investment and commitment of resources, that is subject to risks and uncertainties.***

We are diversifying and expanding our distribution channels, which includes expansion of store network in a measured manner to better connect with our customers and deliver a more immersive beauty experience. Our brick-and-mortar experience stores required substantial investment in equipment and leasehold improvements, information systems, inventory and personnel. Often times our investments are made prior to generating any sales in these stores. We also have entered into substantial operating lease commitments. A decline in sales, the closure, or poor performance of individual or multiple storefronts could result in significant lease termination costs, write-offs of equipment and leasehold improvements and severance costs.

The success of our brick-and-mortar experience store network expansion depends in part on our ability to manage the financial and operational aspects of our brick-and-mortar experience stores expansion strategy. This includes our ability to properly assess the potential profitability and payback period of potential new experience store locations, our ability to hire and train skilled store operating personnel, especially management personnel, our ability to immerse such personnel in our culture, and our ability to guarantee timely supply of inventory for our experience stores In addition, there are many factors unique to brick-and-mortar retail operations, some of which are beyond our control which pose risks and uncertainties to our brick-and-mortar experience store network expansion. These risks and uncertainties include, but are not limited to, macro-economic factors that could have an adverse effect on general retail activity. They include but are not limited to health epidemics, the overall customer traffic or our ability to attract high consumer traffic in and around the location of our brick-and-mortar experience stores, competing stores in the same geographic area, our opening of new stores in the same geographic area as our existing stores, our failure in identifying appropriate locations for opening new stores and accurately predicting customer traffic at such new stores, our inability to manage costs associated with store construction and operation, more challenging environments in managing in-store retail operations, costs associated with unanticipated fluctuations in the value of retail inventory, and our inability to obtain and renew leases in quality retail locations at a reasonable cost. If we are unable to open brick-and-mortar experience stores at convenient locations in cities that have large numbers of customers attributable to our online product sales and offer similar competitive prices at our brick-and-mortar experience stores as our online stores, our ability to retain these customers, foster strong brand loyalty and further enlarge our customer base may be negatively impacted. Meanwhile, if we are unable to generate sufficient sales from these stores, we may fail to recover the advanced costs and investments in connection with such brick-and-mortar experience store expansion and our business and profitably may suffer. The substantial time and resources that any future store expansion strategy may require could also result in disruption to our existing business operations, which may decrease our total revenue and profitability.

***An economic downturn may adversely affect consumer discretionary spending and demand for our products and services.***

Our beauty products may be considered discretionary purchases for consumers. Factors affecting the level of consumer spending for such discretionary items include general economic conditions and other factors, such as consumer confidence in future economic conditions, consumer sentiment, the availability and cost of consumer credit, levels of unemployment, and tax rates. Unfavorable economic conditions may lead consumers to delay or reduce purchases of our products and consumer demand for our products may not grow as we expect. Our sensitivity to economic cycles and any related fluctuation in consumer demand for our products and services may have an adverse effect on our results of operations and financial condition.

***We collect, store, process and use a variety of customer data and information for analysis of the changing consumer preferences and fashion trends, which subjects us to laws and regulations related to privacy, information security and data protection. Any failure to comply with these laws and regulations could materially and adversely harm our business.***

We collect, store, process and use a variety of customer data and information for analysis of the changing consumer preferences and beauty trends to guide our product development and to improve our products and customer experience and to predict and react to industry trends and consumers' preferences and behavior effectively and efficiently. The confidentiality, access, collection, use and disclosure of customers' data are highly regulated in China. PRC government authorities have enacted a series of laws and regulations relating to the protection of privacy, personal information and data, under which we are required to clearly indicate the purposes, methods and scope of any information collection and usage, to obtain appropriate customer consent and to establish customer information protection systems with appropriate remedial measures. While we strive to comply with such laws and regulations, as well as our privacy policies and other obligations we may have with respect to privacy and data protection, some of our data collection activities may be deemed beyond the scope of or without the consent of our customers. Any failure or perceived failure to comply with laws, regulations or policies related to privacy, information security and data protection may result in inquiries and other proceedings or actions against us by government authorities or others, as well as negative publicity and damage to our reputation and brand, each of which could cause us to lose customers. In addition, as data protection and privacy issues draw more and more attention from society, we may also become subject to new laws and regulations, or newly adopted interpretations and applications of existing privacy and data protection laws or regulations, which are often uncertain and in flux and could further restrict collection and usage of customer data, or otherwise inconsistent with our practice. Any additional enactment or promulgation of this type of law or regulation may, among other things, require us to implement new security measures or bring within the legislation or promulgation other personal data not currently regulated. Compliance with any additional laws could be expensive, may place restrictions on our data collection and processing practice, the conduct of our business and the manner in which we interact with our customers.

***Any data breach or security incident may lead to leaks and/or unauthorized access, disclosure, or use of personal data we collect, which may hurt our reputation and brand image, disrupt our operations, as well as materially and adversely affect our financial condition and results of operations.***

We collect, store and analyze customer and operations data, some of which are sensitive personal data. As such, any data breach or security incident could expose us to the risk of unintentional leaks and/or unauthorized access, disclosure, or use of these personal data, which may hurt our reputation and brand image, disrupt our operations, as well as materially and adversely affect our financial condition and results of operations. We could face government enforcement, significant fines, litigation settlements or judgments, and declining share prices, if we were to be found liable for data breaches. Our data is encrypted and saved on cloud-based servers, segregated from the internet, protected by access control, and further backed up in long-distance servers, so as to minimize the possibility of data loss or breach. As of the date of this annual report, we have not experienced any material security breaches.

Despite the security measures we have implemented, we may experience cyber-attacks of varying degrees, including attempts to hack into our cloud or our intranet and steal customer and business information or obtain economic benefits from us. Our security measures may also be breached due to employee error, malfeasance or otherwise. Additionally, outside parties may attempt to fraudulently induce our employees to disclose sensitive information in order to gain access to our data, or may otherwise obtain access to such data. Any such breach or unauthorized access could result in significant legal and financial exposure, damage to our reputation and a loss of confidence in the security of our information system that could deter our customers from engaging with us, and have an adverse effect on our business and results of operations. Because the techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently and often are not recognized until launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures. If an actual or perceived breach of our security occurs, our customers' and business partners' perception of the effectiveness of our security measures could be harmed, we could lose customers and business partners, may not be able to maintain the level of engagement with customers and business partners and we may be exposed to significant legal and financial risks, including legal claims and regulatory fines and penalties. Any of these actions could have a material and adverse effect on our business and results of operations.

***User misconduct on and misuse of the online consumer communities we organize may adversely impact our brand and reputation, and may subject us to liabilities.***

In addition to interactions with our customers at our brick-and-mortar experience stores, we organize customer communities on WeChat. On WeChat we have established closer relationships with our customers, and developed a better understanding of our customers through deep engagement with them. These communities allow our customers to share shopping experiences and freely communicate with each other. However, we don't have full control over how and what our customers will communicate, and our communities could be misused by some of our customers. For example, some of our customers may use our communities as a platform to distribute content that could be deemed as spam by other customers, such as marketing materials for his or her own businesses or businesses he or she is employed to promote, which could impair our customers' experience. In addition, once invited into our online communities, our customers can add each other as contacts and communicate and interact privately. We have no control over our customers' behaviors of our online communities and cannot rule out the possibility that some of them may engage in immoral, disrespectful, fraudulent or illegal activities. To the extent such behaviors or activities are associated with our communities, the public perception of our reputation and brand image could be harmed and prospective customers may be deterred from joining our online communities, which could have a material and adverse effect on our business and reputation.

***The payment methods that we accept subject us to third-party payment-related risks and other risks.***

We accept payments from our customers using a variety of methods, including online payments with credit cards and debit cards issued by major banks and payment through third-party online payment platforms such as WeChat Pay and Alipay. We also rely on third parties to provide payment processing services. For certain payment methods, including credit and debit cards, we pay interchange and other fees, which may increase over time and raise our operating costs and lower our profit margins. We may also be subject to fraud and other illegal activities in connection with the various payment methods we offer, including online payment options. We may also be subject to various rules, regulations, and requirements, regulatory or otherwise, governing electronic fund transfers and online payment, which could change or be reinterpreted to make it difficult or impossible for us to comply with. If we fail to comply with these rules or requirements, we may be subject to fines and higher transaction fees and lose our ability to accept credit and debit card payments from our customers, process electronic fund transfers, or facilitate other types of online payments, and our business, financial condition, and results of operations could be materially and adversely affected.

***If the content we produce and distribute through online social and content platforms, or content available on our website, is deemed to violate PRC laws or regulations, our business and results of operations may be materially and adversely affected.***

We produce and distribute professionally generated beauty and wellness related content on third party online social and content platforms such as WeChat, and RED to promote beauty related knowledge, improve our brand awareness and generate consumers interest in our products. Under PRC laws, we are required to monitor the content we produce and distribute that is factually incorrect, socially destabilizing, obscene or defamatory, and promptly take actions with respect to such content. ****Sometimes, it is arguable as to whether content is factually incorrect or involved other types of illegality, and it may be difficult to determine the type of content that may result in liability to us. Our burden to administer the content, and costs associated therewith, may be exacerbated if we develop our own app with user discussion panel or other interactive functions or features in the future, or introduce such interactive features and functions to our website and WeChat mini-program. If we are found to be liable, we may be subject to fines, revocation of our relevant licenses and other administrative and civil actions, which may interrupt our business. We have implemented measures to review content in light of the relevant laws and regulations before any of them is published. However, such procedures may not prevent all illegal or impropriate content from being distributed, especially content created during living streaming by key opinion leaders ("KOLs") we may collaborate with.

***If our cash from operations is not sufficient to meet our current or future operating needs and expenditures, our business, financial condition and results of operations may be materially and adversely affected.***

We may require additional cash resources due to changed business conditions or other future developments, including any marketing initiatives, investments or acquisitions we may decide to pursue. To the extent we are unable to generate sufficient cash flow, we may be forced to cancel, reduce or delay these activities. Our ability to generate cash to meet our operating needs and expenditures will depend on our future performance and financial condition, which will be affected by financial, business, economic, legislative, regulatory and other factors, including potential changes in costs, pricing, the success of product innovation and marketing, competitive pressure and consumer preferences. If our cash flows and capital resources are insufficient to fund our cash needs, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures or dispose of material assets or operations. Alternatively, if our sources of funding are insufficient to satisfy our cash requirements, we may seek to obtain credit facilities or sell equity or debt securities. The sale of equity securities would result in the dilution of our existing shareholders. The incurrence of indebtedness would result in debt service obligations and operating and financing covenants that could restrict our operations. Furthermore, it is uncertain whether financing will be available in amounts or on terms acceptable to us, if at all, which could materially and adversely affect our business, financial condition and results of operations.

***We may be subject to infringement claims of intellectual property rights or other rights of third parties, which may be expensive to defend and may disrupt our business and operations.***

Our commercial success depends in part on our ability to operate without infringing, misappropriating or otherwise violating the trademarks, patents, copyrights, trade secrets and other proprietary rights of others. We have adopted and implemented internal procedures and licensing practices to prevent unauthorized use of such intellectual properties or the infringement by us of other rights of third parties. However, we cannot be certain that these measures can be effective in completely preventing all possible infringement, misappropriation and other violations of third-party's intellectual property rights or other rights during the course of our business. As we face increasing competition and as litigation becomes a more common way to resolve disputes in China, we face a higher risk of being the subject of intellectual property infringement claims.

We cannot be certain that our operations or any aspects of our business do not or will not infringe upon or otherwise violate patents, copyrights or other intellectual property rights held by third parties. This is especially true because our sales and marketing activities may use photos or video clips that contain portraits of individuals and shows performed by others such as recorded product promotion live-streaming held by our cooperating KOLs. We cannot rule out the possibility that some of these use cases are not properly authorized by the relevant performers and/or proprietary right holders, which may expose us to potential liabilities for infringement of portrait rights or rights to network dissemination of information under Chinese laws. There could also be existing intellectual property of which we are not aware that our operations and business may inadvertently infringe upon. Further, our internal procedures and licensing practices may not be effective in completely preventing the unauthorized use of copyrighted materials or the infringement of other rights of third parties by us and/or our employees. We may receive claims by third parties that we and/or our employees have infringed or otherwise violated their software copyright. We license and use software and other technologies from third parties in our ordinary course of business. The third-party software or technology licenses may not continue to be available to us on acceptable terms or at all and may expose us to potential infringement liability. Any such liability, or our inability to use any of these third-party software or technologies on acceptable terms or at all, could harm our reputation, result in increased operating costs, and/or disruptions to our business that may materially and adversely affect our operating and financial results.

We may from time to time in the future be subject to legal proceedings and claims relating to the intellectual property rights of others. Also, although we have not been subject to claims or lawsuits outside China, we cannot assure you that we will not become subject to intellectual property laws in other jurisdictions, such as the United States. If an infringement claim brought against us in China, the United States or another jurisdiction is successful, we may be required to pay substantial penalties or other damages and fines, enter into license agreements that may not be available on commercially reasonable terms or at all or be subject to injunctions or court orders. Even if allegations or claims lack merit, defending against them could be both costly and time consuming and could significantly divert the efforts and resources of our management and other personnel. Competitors and other third parties may claim as well that our officers or employees or the third-party manufacturing partners third-party manufacturing partners and packaging supply partners have infringed, misappropriated or otherwise violated their product formulas, confidential information, trade secrets or other proprietary information or technology in the course of their employment with us or in their designing and manufacturing products for us, as the case may be. Although we take steps to prevent the unauthorized use or disclosure of such third-party information, intellectual property or technology by our officers, employees or the third-party manufacturing partners and packaging supply partners, we cannot guarantee that our internal intellectual property policy, any other policies or contractual provisions that we have implemented or may implement will be effective. If a claim of infringement, misappropriation or violation is brought against us or one of our officers or employees, we may suffer reputational harm and may be required to pay substantial damages, subject to an injunction or court orders or be required to suspend sales of our products or to remit to the plaintiff the revenues we derive from the sales, any of which could adversely affect our business, financial condition and results of operations.

***If we are unable to protect our intellectual property, the value of our brands and other intangible assets may be diminished, and our business may be adversely affected.***

We rely on a combination of trademark, copyright, trade secret, patent and other laws protecting proprietary rights, nondisclosure and confidentiality agreements and other practices, to protect our brand and proprietary information, know-how, technologies and processes. Our principal intellectual property assets include the registered trademarks for our brand, the design patents and copyrights for our product packaging and logos. Our copyrights, trademarks and design patents are valuable assets that support our brand and consumers' perception of our products. Although we have existing and pending trademark and patent registrations in China, there can be no assurance that all of them will be issued or registered. Historically, some of our trademark applications on certain key categories were rejected, which result in difficulties in our ability to protect our use of our brand name or logo on products of such categories, and may subject us to possible intellectual property disputes with third parties over such uses. Third parties may also oppose our trademark or patent applications domestically or abroad, or otherwise challenge our use of the trademarks or patents. In the event that our trademarks or patents are successfully challenged, we could be forced to rebrand our products or to refrain from using certain designs, which could result in the loss of brand recognition, impair the attractiveness of our products and could require us to devote resources to advertising and marketing new brands and product designs.

Despite our efforts to protect our intellectual property rights and proprietary information, unauthorized parties may attempt to copy or otherwise obtain and use our intellectual properties or know-how. Monitoring for infringement or other unauthorized use of our intellectual property rights and know-how is difficult and costly, and such monitoring may not be effective. From time to time, we may have to resort to courts or administrative proceedings to enforce our intellectual property rights, which may result in substantial costs and the diversion of resources.

***Our employees or business partners or other parties with whom we maintain business relationships may engage in misconduct or other improper activities, which may disrupt our business, hurt our reputation and results of operations.***

Our employees or business partners, including third-party manufacturers and logistics service providers, may be subject to regulatory penalties or punishments or other legal proceedings because of their wrongdoings or regulatory compliance failures, which may disrupt our business. For example, we currently rely on third-party manufacturers to produce our products. Although we usually require our third-party manufacturers to provide compliance representations and covenants, we cannot assure that they will not engage in any incompliant practices such as environmental or product safety requirement violations. If they engage in any noncompliance or face regulatory sanctions or operation suspensions, our business may as a result be disrupted and our reputation may be harmed.

We are exposed to the risk of fraud or other misconduct by our employees or third-party partners with whom we have business arrangements. Misconduct by employees or third-party partners could include inadvertent or intentional failures to comply with the laws and regulations to which we are subject or with our policies, provide accurate information to regulatory authorities, comply with ethical, social, product, labor and environmental standards, comply with fraud and abuse laws and regulations, report financial information or data accurately, or disclose unauthorized activities to us. We have no control over the off-work time and behaviors of our employees and the operations of our third-party partners. Any legal liabilities of, or regulatory actions against, our employees, especially key employees, or business partners may affect our business activities and reputation and, in turn, our results of operations.

***If the PRC subsidiaries fail to obtain and maintain the requisite licenses, permits, registrations and filings applicable to the business, or fail to obtain additional licenses, permits, registrations or filings that become necessary as a result of new enactment or promulgation of government policies, laws or regulations or the expansion of our business, the business and results of operations may be materially and adversely affected.***

In general, the beauty industry and certain business practices such as the operation of franchise businesses in China are highly regulated, and may require multiple licenses, permits, filings and approvals to conduct and develop business. As of the date of this annual report, our PRC subsidiaries have obtained and maintained valid business licenses or permits, among other things, necessary for our operations and for the provision of beauty services and sale of cosmetic products. Xinzhan has also completed record filing and annual reporting with the MOFCOM to conduct franchise business. Xinzhan has also obtained a medical device operation permit, expiring on August 20, 2028, despite the fact that the devices in the stores are not medical devices and that the operation does not require such permit.

However, as a fast-growing company with a limited operating history that is continuously exploring other approaches to conduct sales and marketing cost-effectively and capture points of growth, we may not be able to obtain in time all the additional licenses, registrations and filings that are advisable to obtain for certain aspects of our operations. Failure to obtain such additional licenses, permits, registrations or filings that could later become necessary to obtain as a result of new enactment or promulgation of government policies, laws or regulations, which may subject us to warnings, orders of correction, pecuniary penalties or other administrative proceedings from relevant governmental authorities, could materially and adversely affect our business and results of operations. As of the date of this annual report, we have not received any notice of warning nor have we been subject to any administrative penalties or other disciplinary actions from the relevant governmental authorities for lack of licenses, permits, registrations or filings. However, we cannot assure you that we will not be subject to any administrative action that may materially and adversely affect our business, financial condition and results of operations.

If we fail to maintain or renew one or more of our licenses and certificates when their current term expires, or obtain such renewals on a timely manner, our operations could be disrupted. In addition, under relevant PRC laws and regulations are required to update certain licenses if any change to their respective name, registered capital or legal representative during the validity period of such license. If we fail to properly renew and maintain all such requisite licenses on time, we may face penalties and in extreme circumstances, order to suspend or terminate our website and online business.

Further, due to uncertainties of interpretation and implementation of existing laws and the adoption of additional laws and regulations, the licenses, permits, registrations or filings we held may be deemed insufficient by PRC governments, which may restrain our ability to expand our business scope and may subject us to fines or other regulatory actions. Furthermore, as we develop and expand our business scope, we may need to obtain additional permits and licenses and we cannot assure that we will be able to obtain such permits on time or at all.

***We are subject to risks relating to our leased properties.***

Pursuant to the Administrative Measures for Commodity Housing Leasing, parties to a lease agreement are required to file the lease agreements for registration and obtain property leasing filing certificates for their leases. Our leasehold interests in leased properties have not been registered with the relevant PRC government authorities as required by PRC law, which may expose us to potential fines if we fail to remediate after receiving any notice from the relevant PRC government authorities. As of the date of this annual report, we believe that failure to complete the lease registration will not affect the legal effectiveness of our lease agreements according to PRC law, but the real estate administrative authorities may require the parties to the lease agreements to complete lease registration within a prescribed period of time, and the failure to do so may subject the parties to fines from RMB1,000 to RMB10,000 for each of such lease agreements. There can be no assurance that legal disputes or conflicts concerning such leases and tenancies will not arise in the future.

As of the date of this annual report, our PRC subsidiaries have a total of nine leases and have not completed filings for any of the lease agreements. As of the date of this annual report, we are not aware of any actions, claims or investigations threatened against us with respect to the defects in our leasehold interests. However, if any of our leases is terminated as a result of challenges by third parties or governmental authorities for lack of title certificates or proof of authorization to lease, we do not expect to be subject to any fines or penalties, but we may be forced to relocate the affected offices, warehouse and stores and incur additional expenses relating to such relocation. Any dispute or claim in relation to the titles of the properties that our PRC subsidiaries occupy, including any litigation involving allegations of illegal or unauthorized use of these properties, could require us to relocate the business operations occupying these properties.

***Our financial and operating performance may be adversely affected by epidemics, adverse weather conditions, natural disasters and other catastrophes.***

Our business could be materially and adversely affected by epidemics, adverse weather conditions, natural disasters and other catastrophes. Similarly, war (including the potential for war), terrorist activity (including threats of terrorist activity) and travel-related accidents (such as bed bug infestation), as well as geopolitical uncertainty and international conflict, may affect travel and may in turn have a material adverse effect on our business and results of operations. In addition, we may not be adequately prepared in contingency planning or recovery capability in relation to a major incident or crisis, and as a result, our operational continuity may be adversely affected and our reputation may be harmed.

***The continued and collaborative efforts of our senior management and key employees are crucial to our success, and our business may be harmed if we lose their services.***

Our success depends on the continued and collaborative efforts of our senior management and key employees. If our senior management cannot work together effectively or efficiently, our business may be severely disrupted. If, however, one or more of our executives or other key personnel are unable or unwilling to continue to provide services to us, we may not be able to find suitable replacements easily or at all. Competition for management and key personnel is intense and the pool of qualified candidates is limited. We may not be able to retain the services of our executives or key personnel, or attract and retain experienced executives or key personnel in the future.

Our future success will also depend on our ability to attract and retain highly skilled technical, managerial, editorial, finance, marketing, sales and customer service employees. Qualified individuals are in high demand and competition for talent could cause us to offer higher compensation and other benefits to attract and retain them. Even if we were to offer higher compensation, we may not be able to successfully attract, assimilate or retain the personnel we need to succeed.

If any of our executive officers or employees joins a competitor or forms a competing business, they may divulge business secrets, know-how, customer lists and other valuable resources. Our senior management and key employees have entered into employment agreements and confidentiality and non-competition agreements with us. However, if any dispute arises between any of them and us, we may have to incur substantial costs and expenses in order to enforce such agreements in China or we may be unable to enforce such agreements at all. Any failure to attract or retain key management and personnel could severely disrupt our business and growth.

***We may from time to time become a party to litigation, legal disputes, claims or administrative proceedings that may materially and adversely affect us.***

We may from time to time become a party to various litigation, legal disputes, claims or administrative proceedings arising in the ordinary course of our business. The outcome of any litigation, legal disputes, claims or administrative proceedings is hard to predict. If any verdict or award is rendered against us or if we decide to settle the disputes, we may be required to incur monetary damages or other liabilities. Even if we can successfully defend ourselves, we may have to incur substantial costs and spend substantial time and effort in these lawsuits. Negative publicity relating to such litigation, legal disputes, claims or administrative proceedings may damage our reputation and adversely affect the image of our brand and services. Furthermore, any litigation, legal disputes, claims or administrative proceedings which are not of material importance may escalate due to the various factors involved, such as the facts and circumstances of the cases, the likelihood of winning or losing, the monetary amount at stake, and the parties concerned continue to evolve in the future, and such factors may result in these cases becoming of material importance to us. Consequently, any ongoing or future litigation, legal disputes, claims or administrative proceedings could materially and adversely affect our business, financial condition and results of operations.

***We do not maintain any insurance to cover our assets, operations and any loss arising from business interruptions and we may be exposed to losses which may adversely affect our profitability and financial position.***

We face the risk of loss or damage to our equipment due to fire, theft, or other natural disasters in China. Such events may also cause a disruption or cessation in our business operations, and thus may adversely affect our financial results. We do not have any insurance to cover the potential losses. We may also be liable for any liability, debt or other financial obligations related to such losses.

Due to the nature of our operations, there is also a risk of accidents occurring either to our employees or to customers or third parties on our premises and/or on our franchisees' jobsites during the course of operations. In the event that any claims arise in respect of such occurrences and liability for such claims are attributed to us, we may be exposed to losses which may adversely affect our profitability and financial position.

***We rely on a limited number of suppliers to provide us with the raw materials and ingredients we use for the products. We may not be able to obtain such supplies at competitive prices during times of high demand, which could have a material adverse effect on our business, financial condition and results of operations.***

Park Ha Jiangsu requires the third-party manufacturers that produce the products to purchase raw materials and ingredients from designated raw material suppliers. As such, we rely on a limited number of suppliers for the raw materials and ingredients used in our products. For the fiscal year ended October 31, 2025, there were two suppliers who accounted for 10% or more of the Company's total purchases and such suppliers accounted for approximately 26%, and 11% of our total purchases, respectively. For the fiscal year ended October 31, 2024, there were four suppliers who accounted for 10% or more of the Company's total purchases and such suppliers accounted for approximately 15%, 11%, 10% and 11% of our total purchases, respectively. For the fiscal year ended October 31, 2023, there was one supplier who accounted for 10% or more of the Company's total purchases and such supplier accounted for approximately 58% of our total purchases. This reliance involves a number of significant risks. Unavailability of materials and interruptions in delivery of raw materials from our suppliers could result in manufacturing delays. We are also exposed to risks related to fluctuations in the quality and price of components and raw materials.

Our suppliers have no obligation to continue to accept purchase orders from us. Our suppliers may stop selling their products to us on commercially reasonable terms or at all. We may be unable to get them to accept additional orders or engage an alternate supplier on terms that are acceptable to us, which may undermine our ability to deliver our products to customers in a timely manner. Identifying reliable suppliers is an extensive process that requires us to evaluate their quality control, technical capabilities, responsiveness and service, financial stability, regulatory compliance, and labor and other ethical practices and ensure they meet our standards. Even if alternate suppliers are available to us or our manufacturers, identifying them is often difficult and time consuming. If we or our manufacturers are unable to obtain an ample supply of raw materials from our existing suppliers or alternative sources of supply, we may be unable to satisfy our customers' orders, which could reduce our revenues, subject us to claims for damages and adversely affect our relationships with our customers. Accordingly, a loss of any of our largest suppliers could have an adverse effect on our business, financial condition, and results of operations.

***We derive a significant portion of our revenue from a few major customers. Any significant decrease in the demand from our largest customers for our products may materially and adversely affect our financial conditions and results of operations.***

A significant portion of our revenue was derived from our five largest customers. For the fiscal years ended October 31, 2025, 2024 and 2023, 25%, 38% and 36% of our revenue were attributable to our top five customers, respectively. Our customers' purchases are made on an order-by-order basis, and our business with our customers has been, and we expect it will continue to be, conducted based on the actual orders received from time to time. There is no assurance that our largest customers will continue placing orders with us at the same or increasing levels, or at all. Our customers level of demand for our products may fluctuate significantly from period to period. Such fluctuation is attributable mainly to changes in customer demand, such as interpretation of fashion and beauty trends. The loss of our largest customers, or if we are unable to attract new customers or if our existing customers decrease their spending on the products we offer, fail to make repeat purchases of our products, will harm our business, financial condition, results of operations, and growth prospects.

***We are subject to the risk of non-payments or delayed payments by our customers, which could affect our financial condition and results of operations.***

As of October 31, 2025, 2024 and 2023, 70%,63% and 71% of our accounts receivable were attributable to our top five customers, respectively. Our allowance for loans receivables from franchisees increased from $55,520 as of October 31, 2024 to $232,876 as of October 31, 2025, which was primarily due to financial difficulties of franchisees. As of the date of this annual report, the payment has not been settled. Other than that, we did not experience significant delays or difficulties in collection from our customers. If we were to experience any unexpected delay or difficulty in collections from our customers in the future, our operating cash flows and financial condition would be adversely affected.

We believe effective accounts receivable management is critical to maintaining our liquidity. As we continue to expand our business and engage new customers, our accounts receivable is anticipated to increase accordingly. However, there is no assurance that our customers will settle in a timely manner. Our effort to strength our accounts receivable management system may not be effective and we cannot assure you that we will be able to fully recover from our customers the outstanding amounts due in a timely manner. Any increase in uncollectible accounts receivable may adversely affect our business, financial condition and results of operations.

***We currently contract with third-party contractors, and in some cases, a single contractor, for all aspects of the supply, packaging, logistics, and formulation of our cosmetics products, and expected to continue to do so to support commercial scale production of our cosmetics products. There are significant risks associated with contracting with third-party suppliers, including their ability to meet the increased need that may result from our increasing any commercialization efforts. This increases the risk that we will not have sufficient quantities of products or be able to obtain such quantities at an acceptable cost, which could delay, prevent or impair our development or commercialization efforts.***

We currently outsource our product manufacturing to the third-party manufacturing partners and packaging supply partners, and specify that the third-party partners shall purchase raw materials from designated raw material suppliers. We do not have sufficient control over the manufacturing process and cannot guarantee that no contaminations, defects or other safety issues would happen with respect to the raw materials, components and ingredients or during the manufacturing process. We have required the third-party manufacturing partners and packaging supply partners to deliver reports evidencing the safety of the products and imposed compliance covenants on the third-party manufacturing partners and packaging supply partners. However, we cannot be sure that these measures are or will be effective in preventing all defects or safety issues or otherwise maintaining full compliance of our products with product safety related laws, regulations and standards. Our exposure to product liability risk may increase as our manufacturing and sales volume increases. The situation is further complicated by the fact that a product may be safe for the general population when used as directed but could cause an adverse reaction for a person who has a health condition or allergies, or who is taking a prescription medication. While we include what we believe are adequate instructions and warnings, previously unknown adverse reactions could occur. If we discover that any of our products are causing adverse reactions, we could suffer adverse publicity or administrative sanctions. If any batch of our products contains contaminants, fails to meet national safety standards or otherwise has defects or safety issues, we may need to suspend the sale or, in severe cases, order recalls of such batch or all of the products in question.

***Our success depends on the implementation of the franchise business model. Our growth through franchising may not occur as rapidly as we anticipate.***

We will continue to seek franchisees to operate our "Park Ha" stores. We believe that our ability to recruit, retain and contract with qualified franchisees will be increasingly important to our operations as we expand. As of October 31, 2025, 2024 and 2023, we had 22, 45and 38 franchisees in China, of which 22, 43 and 36 franchisees operate under the store name "Park Ha". As of October 31, 2025, 2024 and 2023, we had 0, 2 and 2 franchisees operate under a different brand name, "Geni" or "歌妮". If we fail to expand our franchise, our results of operation will be adversely impacted.

***We could face liability resulting from acts of our franchisees or related to our relationship with our franchisees.***

Under the franchise business model, we may face claims and liabilities for the acts of our franchisees based on vicarious liability, joint-employer liability, or other theories or liabilities. Such legal actions could result in expensive litigation with our franchisees or third parties and could adversely affect both our profit and our important relations with our franchisees. Also, our franchisees may from time to time disagree with us and our strategies regarding the business operations or our interpretation of our respective rights and obligations under the respective franchise agreements and the terms and conditions of the franchisee/franchisor relationship. This may lead to disputes with our franchisees, and we expect such disputes to occur from time to time in the future as we continue to adopt a franchise system. Such disputes may result in legal action against us. To the extent we have such disputes, the attention, time and financial resources of our management and our franchisees will be diverted from our business, which could have a material adverse effect on our business, financial condition, results of operations and cash flows even if we have a successful outcome in the dispute. In addition, regulatory or legal developments could result in changes to laws or the franchisor/franchisee relationship that could negatively impact the franchise business model and, accordingly, our profit.

***We offer incentives such as cash subsidies to our franchisees and the amount of such incentives could potentially have adverse impacts on our financial performance.***

We offer incentives such as cash subsidies to our regional store franchisees and skin management center franchisees within two weeks upon the entry of franchise agreements/renewals and full payment of the franchise fees. The incentives suspended in the second half of 2025.We require our franchisees to use the cash subsidies for renovation and advertising purposes only. Currently, we do not experience any financial pressure from offering such cash subsidies. However, if in the future our current subsidies are insufficient to retain our existing franchisees and attract new franchisees, and we may need to increase the cash subsidies we offer to attract franchisees, our business, financial condition, and cash flows could be adversely affected.

***We may grant employee share options and other share-based compensation awards in the future. Any additional grant of employee share options and other share-based compensation awards in the future may have a material adverse effect on our results of operations.***

We may adopt employee share option and other share-based compensation awards to our employees, officers, directors and other eligible persons to incentivize their performance and align their interests with ours. As a result of these grants and potential future grants, we expect to continue to incur significant share-based compensation expenses in the future. The amount of these expenses is based on the fair value of the share-based awards. We account for compensation costs for all share options using a fair-value-based method and recognize expenses in our combined and consolidated statements of comprehensive income and other comprehensive income in accordance with U.S. GAAP. The expenses associated with share-based compensation will decrease our profitability, perhaps materially, and the additional awards issued under share-based compensation plans will dilute the ownership interests of our shareholders. However, if we limit the scope of our share-based compensation plan, we may not be able to attract or retain key personnel who expect to be compensated by such share-based awards.

***Risks Related to Our Ordinary Shares***

***Our dual class share structure with different voting rights may adversely affect the value and liquidity of the Class A Ordinary Shares.***

We cannot predict whether our dual class share structure with different voting rights will result in a lower or more volatile market price of the Class A Ordinary Shares, in adverse publicity, or other adverse consequences. Certain index providers have announced restrictions on including companies with multiple class share structures in certain of their indices. Because of our dual class structure, we will likely be excluded from these indices and other stock indices that take similar actions. Given the sustained flow of investment funds into passive strategies that seek to track certain indices, exclusion from certain stock indices would likely preclude investment by many of these funds and could make the Class A Ordinary Shares less attractive to investors. In addition, several shareholder advisory firms have announced their opposition to the use of a multiple class structure and our dual class structure may cause shareholder advisory firms to publish negative commentary about our corporate governance, in which case, the market price and liquidity of the Class A Ordinary Shares could be adversely affected.

***Future issuances of Class B Ordinary Shares may be dilutive to holders of Class A Ordinary Shares.***

We may issue additional Class B Ordinary Shares in the future in connection with future financings, strategic transactions, equity incentive plans, or otherwise. Any such issuance could result in dilution to existing holders of our Class A Ordinary Shares.

In addition, since Class B Ordinary Shares carry greater voting rights than Class A Ordinary Shares, any future issuances of Class B Ordinary Shares could have the effect of further concentrating voting power in certain shareholders. This may reduce the influence of Class A Ordinary Shareholders over matters requiring shareholder approval.

There can be no assurance as to when or if we will issue additional Class B Ordinary Shares, or the terms of any such issuance. However, any such future issuances could materially and adversely affect the market price of our Class A Ordinary Shares and dilute the interests of existing Class A Ordinary Shareholders.

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***If we cannot continue to satisfy the continued listing requirements and other Nasdaq rules, our securities may be delisted, which could negatively impact the price of our securities and your ability to sell them.***

Our Class A Ordinary Shares are listed on Nasdaq. In order to maintain our listing on Nasdaq, we are required to comply with applicable Nasdaq rules, including those regarding minimum shareholders' equity, minimum share price, minimum market value of publicly held shares, and various additional requirements. We may not be able to continue to satisfy these requirements and applicable rules. If we are unable to satisfy the Nasdaq criteria for maintaining our listing, our securities could be subject to delisting.

On September 2, 2025, we received a notice from the Listing Qualifications Department of Nasdaq notifying the Company that based upon the closing bid price of the Class A Ordinary Shares of the Company for the last 30 consecutive business days, the Company no longer meets the continued listing requirement of Nasdaq under Nasdaq Listing Rules 5550(a)(2) to maintain a minimum bid price of $1 per share. Nasdaq has provided the Company with a 180 calendar days compliance period, or until March 2, 2026, in which to regain compliance with Nasdaq continued listing requirement. Our Class A Ordinary Shares began trading on an adjusted basis, reflecting the reverse stock split, on February 20, 2026, under the existing ticker symbol "BYAH."

We cannot assure you that our Class A Ordinary Shares will remain above the minimum bid price of $1 per share in the future.

If the Nasdaq Capital Market subsequently delists our securities from trading, we could face significant consequences, including:

● a limited availability for market quotations for our securities;

● reduced liquidity with respect to our securities;

● a determination that our Class A Ordinary Share is a "penny stock," which will require brokers trading in our Ordinary Share to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our Class A Ordinary Share;

● limited amount of news and analyst coverage; and

● a decreased ability to issue additional securities or obtain additional financing in the future.

The Company is currently evaluating options to regain compliance and intends to timely regain compliance with Nasdaq's continued listing requirement, including, among other things, to effect a share consolidation. As of the date of this annual report, our board of directors is still evaluating the ratio of the share consolidation and other options to regain compliance.

***Holders of our Warrants will have no rights as a shareholder until they acquire our Class A Ordinary Shares.***

Until holders acquire our Class A Ordinary Shares upon exercise of such warrants, holders will have no rights with respect to the Class A Ordinary Shares issuable upon exercise of Warrants. Upon exercise of the Warrants, such holders will be entitled to exercise the rights of shareholder only as to matters for which the record date occurs after the exercise date.

***Our Chairperson of the Board of Directors and Chief Executive Officer, Ms. Xiaoqiu Zhang, has a significant influence over our Company and future corporate decisions. Her interests may not always be aligned with those of other shareholders.***

As of the date of this annual report, Ms. Xiaoqiu Zhang, our Chairperson of the Board of Directors and Chief Executive Officer, beneficially owns more than 50% of our outstanding Ordinary Shares. As such, Ms. Zhang could have significant influence on determining the outcome of any corporate transaction or other matter submitted to the shareholders for approval, including mergers, consolidations, the election of directors and other significant corporate actions. In cases where her interests are aligned with other shareholders, she will also have the power to prevent or cause a change in control. Ms. Zhang will also have the power to prevent or cause a change in control. Without the consent of Ms. Zhang, we may be prevented from entering into transactions that could be beneficial to us or our minority shareholders. In addition, Ms. Zhang could violate her fiduciary duties by diverting business opportunities from us to herself or others. The interests of Ms. Zhang may differ from the interests of our other shareholders. Thus, there might be potential risks for conflicts of interest and the impact on internal controls. The concentration in the ownership of our Ordinary Shares may cause a material decline in the value of our Ordinary Shares.

***The trading price of the Ordinary Shares is likely to be volatile, which could result in substantial losses to investors.***

The trading price of the Ordinary Shares is likely to be volatile and could fluctuate widely due to factors beyond our control. This may happen because of broad market and industry factors, including the performance and fluctuation of the market prices of other companies with business operations located mainly in China that have listed their securities in the United States. In addition to market and industry factors, the price and trading volume for the Ordinary Shares may be highly volatile for factors specific to our own operations, including the following:

● variations in our revenues, earnings, cash flow;

● fluctuations in operating metrics;

● announcements of new investments, acquisitions, strategic partnerships or joint ventures by us or our competitors;

● announcements of new products and services and expansions by us or our competitors;

● termination or non-renewal of contracts or any other material adverse change in our relationship with our key customers or suppliers;

● changes in financial estimates by securities analysts;

● detrimental negative publicity about us, our competitors or our industry;

● additions or departures of key personnel;

● release of lockup or other transfer restrictions on our outstanding equity securities or sales of additional equity securities;

● regulatory developments affecting us or our industry; and

● potential litigation or regulatory investigations.

Any of these factors may result in large and sudden changes in the volume and price at which the Ordinary Shares will trade.

In the past, shareholders of public companies have often brought securities class-action suits against those companies following periods of instability in the market price of their securities. If we were involved in a class- action suit, it could divert a significant amount of our management's attention and other resources from our business and operations and require us to incur significant expenses to defend the suit, which could harm our results of operations. Any such class action suit, whether or not successful, could harm our reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.

***You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated in the Cayman Islands.***

We are an exempted company with limited liability incorporated under the laws of the Cayman Islands. Our corporate affairs are governed by our memorandum and articles of association, as amended from time to time, the Companies Act and the common law of the Cayman Islands. The rights of shareholders to take action against our directors, actions by our minority shareholders and the fiduciary duties of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from the common law of England and Wales, the decisions of whose courts are of persuasive authority, but are not binding, on a court in the Cayman Islands. The rights of our shareholders and the fiduciary duties of our directors under Cayman Islands law may be narrower in scope or less developed than they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a less developed body of securities laws than the United States. Some U.S. states, such as Delaware, have more fully developed and judicially interpreted bodies of corporate law than the Cayman Islands. In addition, Cayman Islands companies may not have standing to initiate a shareholder derivative action in a federal court of the United States. In addition, while under Delaware law, controlling shareholders owe fiduciary duties to the companies they control and their minority shareholders, under Cayman Islands law, our controlling shareholders do not owe any such fiduciary duties to our company or to our minority shareholders. Accordingly, our controlling shareholders may exercise their powers as shareholders, including the exercise of voting rights in respect of their shares, in such manner as they think fit, subject only to very limited equitable constraints. One of the examples of such constraint is that the exercise of voting rights to amend the memorandum or articles of association of a Cayman Islands company must be exercised in good faith for the benefit of the Company as a whole.

Shareholders of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records (other than the memorandum and articles of association, special resolutions which have been passed by shareholders, register of mortgages and charges, and a list of current directors) or to obtain copies of lists of shareholders of these companies. Our directors have discretion under our articles of association to determine whether or not, and under what conditions, our corporate records may be inspected by our shareholders, but are not obliged to make them available to our shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy contest.

Certain corporate governance practices in the Cayman Islands, which is our home country, differ significantly from requirements for companies incorporated in other jurisdictions such as the United States. If we choose to follow home country practice, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers.

As a result of all of the above, our public shareholders may have more difficulty in protecting their interests in the face of actions taken by our management, members of the Board of Directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States.

***Our management will have considerable discretion as to the use of the net proceeds from any future financings and you may not agree with our management on these uses.***

Our management will have considerable discretion in the application of the net proceeds received by us. You will not have the opportunity, as part of your investment decision, to assess whether proceeds are being used appropriately. The net proceeds may be used for corporate purposes that do not improve our efforts to achieve or maintain profitability or increase the price of our Ordinary Shares. The net proceeds from our initial public offering in December 2024 may be placed in investments that do not produce income or that lose value.

***We are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.***

As a company with less than US$1.235 billion in revenues for our last fiscal year, we qualify as an "emerging growth company" pursuant to the JOBS Act. Therefore, we may take advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include exemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002 in the assessment of the emerging growth company's internal control over financial reporting. As a result, if we elect not to comply with such reporting and other requirements, in particular the auditor attestation requirements, our investors may not have access to certain information they may deem important.

The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply with such new or revised accounting standards. We have elected to opt in such exemptions afforded to an emerging growth company. Specifically, we have elected to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to comply under Section 102(b)(1) of the Sarbanes-Oxley Act of 2002. This election may result in our financial statements not being comparable to companies that comply with public company effective dates.

***As a company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from the Nasdaq Listing Rules.***

As an exempted company with limited liability incorporated in the Cayman Islands and listed on the Nasdaq, we are subject to corporate governance listing standards of Nasdaq. 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 currently intend to follow Cayman Islands corporate governance practices in lieu of the corporate governance requirements of the Nasdaq that listed companies must have: (i) a majority of independent directors; (ii) a nominating/corporate governance committee composed entirely of independent directors; and (iii) a majority of independent directors and that the audit committee consist of at least three members. To the extent that we choose to follow home country practice in the future, our shareholders may be afforded less protection than they otherwise would enjoy under Nasdaq corporate governance listing standards applicable to U.S. domestic issuers.

***We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions applicable to U.S. domestic public companies.***

Because we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, including:

● the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q or current reports on Form 8-K;

● the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act;

● the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and

● the selective disclosure rules by issuers of material nonpublic information under Regulation FD.

● certain audit committee independence requirements in Rule 10A-3 of the Exchange Act.

As a result, you may not be afforded the same protections or information that would be made available to you were you investing in a U.S. domestic issuer.

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

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 United States 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 Rules of the Nasdaq. 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 are a "controlled company" as defined under the Nasdaq Stock Market corporate governance rules. As a result, we will qualify for, and intend to rely on, exemptions from certain corporate governance requirements that would otherwise provide protection to shareholders of other companies.***

We are a "controlled company" as defined under the Nasdaq corporate governance rules because Ms. Xiaoqiu Zhang, our Chairperson of the Board of Directors and chief executive officer, beneficially owns more than 50% of our total voting power. For so long as we remain a controlled company, we are permitted to elect to rely, and may rely, on certain exemptions from the corporate governance rules, including the rule that we have to establish a nominating and corporate governance committee composed entirely of 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. Even if we cease to be a controlled company, we may still rely on exemptions available to foreign private issuers, including being able to adopt home country practices in relation to corporate governance matters.

***If securities or industry analysts cease to publish research or reports about our business, or if they adversely change their recommendations regarding the Ordinary Shares, the market price for the Ordinary Shares and trading volume could decline.***

The trading market for our Ordinary Shares will be influenced by research or reports that industry or securities analysts publish about our business. If one or more analysts who cover us downgrade the Ordinary Shares, the market price for the Ordinary Shares would likely decline. If one or more of these analysts cease to cover us or fail to regularly publish reports on us, we could lose visibility in the financial markets, which, in turn, could cause the market price or trading volume for the Ordinary Shares to decline.

***Certain judgments obtained against us by our shareholders may not be enforceable.***

We are an exempted company limited by shares incorporated under the laws of the Cayman Islands and substantially all of our assets are located outside of the United States. All of our current operations are conducted in China. In addition, all of our current directors and officers are nationals and residents of countries other than the United States. All of the assets of these persons are located outside the United States. As a result, it may be difficult or impossible for you to bring an action against us or against these individuals in the United States in the event that you believe that your rights have been infringed under the U.S. federal securities laws or otherwise. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and of China may render you unable to enforce a judgment against our assets or the assets of our directors and officers. For more information regarding the relevant laws of the Cayman Islands and China. However, the deposit agreement gives you the right to submit claims against us to binding arbitration, and arbitration awards may be enforceable against us and our assets in China even when court judgments are not.

***The sale or availability for sale of substantial amounts of Ordinary Shares could adversely affect their market price.***

Sales of substantial amounts of Ordinary Shares in the public market, or the perception that these sales could occur, could adversely affect the market price of the Ordinary Shares and could materially impair our ability to raise capital through equity offerings in the future. The Ordinary Shares sold in our initial public offering in December 2024 are freely tradable without restriction or further registration under the Securities Act, and shares held by our shareholders may also be sold in the public market in the future, subject to the restrictions in Rule 144 and Rule 701 under the Securities Act and the applicable lock-up agreements (if any). We cannot predict what effect, if any, market sales of securities held by our significant shareholders or any other shareholder or the availability of these securities for future sale will have on the market price of the Ordinary Shares.

***You may need to rely on a price appreciation of the Ordinary Shares for a return on your investment.***

Our Board of Directors has discretion as to whether to distribute dividends, subject to certain requirements of Cayman Islands law. In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our directors. In either case, all dividends are subject to certain restrictions under Cayman Islands law, namely that our Company may pay a dividend out of either profit or a share premium account, provided always that in no circumstances may a dividend be paid if this would result in us being unable to pay our debts as they fall due in the ordinary course of business.

Even if our Board of Directors decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiaries, our financial condition, contractual restrictions and other factors deemed relevant by our Board of Directors. Accordingly, the return on your investment in the Ordinary Shares will likely need to rely on future price appreciation of the Ordinary Shares. There is no guarantee that the Ordinary Shares will appreciate in value or even maintain the price at which you purchased the Ordinary Shares. You may not realize a return on your investment in the Ordinary Shares and you may even lose your entire investment in the Ordinary Shares.

***There can be no assurance that we will not be a passive foreign investment company for U.S. federal income tax purposes for any taxable year, which could result in adverse U.S. federal income tax consequences to U.S. holders of the Ordinary Shares.***

A non-U.S. corporation, such as our company, will be considered a passive foreign investment company, or "PFIC," for any taxable year if either (i) at least 75% of its gross income is passive income or (ii) at least 50% of the value of its assets (generally determined on the basis of a quarterly average) is attributable to assets that produce or are held for the production of passive income.

Based upon our current and projected income and assets and projections as to the value of our assets, we do not expect to be a PFIC for the current taxable year or the foreseeable future. However, no assurance can be given in this regard because the determination of whether we will be or become a PFIC is a factual determination made annually that will depend, in part, upon the composition of our income and assets. Fluctuations in the market price of the Ordinary Shares may cause us to be a PFIC for the current or future taxable years because the value of our assets for purposes of the asset test, including the value of our goodwill and unbooked intangibles, may be determined by reference to the market price of the Ordinary Shares from time to time (which may be volatile). If our market capitalization subsequently declines, we may be or become a PFIC for the current taxable year or future taxable years. Furthermore, the composition of our income and assets may also be affected by how, and how quickly, we use our liquid assets and the cash raised in any future offering. Under circumstances where our revenue from activities that produce passive income significantly increases relative to our revenue from activities that produce non-passive income, or where we determine not to deploy significant amounts of cash for active purposes, our risk of being or becoming a PFIC may substantially increase. Because there are uncertainties in the application of the relevant rules, there can be no assurance that we will not be a PFIC for the current taxable year or any future taxable year.

If we were treated as a PFIC for any taxable year during which a U.S. investor held an ordinary share or an ordinary share, certain adverse U.S. federal income tax consequences could apply to the U.S. investor.

***We will incur additional costs as a result of being a public company.***

We are a public company and expect to incur significant legal, accounting and other expenses that we did not incur as a private company. These additional costs could negatively affect our financial results. In addition, changing laws, regulations and standards relating to corporate governance and public disclosure, including regulations implemented by the Nasdaq, may increase legal and financial compliance costs and make some activities more time-consuming. These laws, regulations and standards are subject to varying interpretations and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. We intend to invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of management's time and attention from revenue-generating activities to compliance activities. If, notwithstanding our efforts to comply with new laws, regulations and standards, we fail to comply, regulatory authorities may initiate legal proceedings against us and our business may be harmed.

***If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud.***

Section 404 of the Sarbanes-Oxley Act of 2002 requires that we maintain effective internal control over financial reporting and disclosure controls and procedures. In particular, we must perform system and process evaluations, document our controls and perform testing of our key controls over financial reporting to allow for management and our independent registered public accounting firm to report on the effectiveness of the company's internal control over financial reporting.

Our management concluded that our internal control over financial reporting as of October 31, 2025 was not effective. We cannot assure you that in the future our management or our independent registered public accounting firm will not identify material weaknesses in evaluating the effectiveness of the company's internal control over financial reporting. In addition, because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. 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, harm our results of operations, and lead to a decline in the trading price of the Ordinary Shares. 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. Furthermore, we have incurred and expect to continue to incur considerable costs and to use significant management time and the other resources in an effort to comply with Section 404 and other requirements of the Sarbanes-Oxley Act.

**ITEM 4. INFORMATION OF THE COMPANY**

**A. History and Development of the Company**

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***Our Corporate History and Structure***

Park Ha Cayman is a holding company incorporated in the Cayman Islands with no operations of its own and conducts its operations in China through its PRC subsidiaries.

The following diagram illustrates our corporate structure as of October 31, 2025:

![A diagram of a company Description automatically generated](ea027833401_img1.jpg)

Xinzhan was incorporated on March 31, 2016 under the laws of the PRC and is a wholly owned subsidiary of WFOE.

Park Ha Shanghai was incorporated on April 17, 2017 under the laws of the PRC and is a wholly owned subsidiary of Xinzhan.

Park Ha Jiangsu was incorporated on August 13, 2019 under the laws of the PRC and is a wholly owned subsidiary of WFOE.

Park Ha Cayman was incorporated on October 11, 2022 under the laws of the Cayman Islands in anticipation of future capital raising from international investors.

Park Ha HK was incorporated on October 25, 2022 under the laws of Hong Kong and a wholly owned subsidiary of Park Ha Cayman.

WFOE was incorporated on May 5, 2023 under the laws of the PRC and is a wholly owned subsidiary of Park Ha HK. It is a holding company and is not engaged in any business as of the date of this annual report.

In connection with the restructuring for our initial public offering, WFOE acquired 100% of the equity interest in Park Ha Jiangsu and Xinzhan.

Wuxi Muchen was incorporated on February 21, 2025 under the laws of the PRC and is a wholly owned subsidiary of Park Ha Jiangsu.

Wuxi Mufeng was incorporated on February 21, 2025 under the laws of the PRC and is a wholly owned subsidiary of Park Ha Jiangsu.

Xinyuexuan Beauty Salon ("xinyuexuan") was incorporated on July 28, 2025 in the PRC and is controlled by Park Ha Jiangsu through contractual arrangement as its variable interest entity ("VIE").

Aimei Hui Beauty Center ("Aimei Hui") was incorporated on August 11, 2025 in the PRC and is controlled by Park Ha Jiangsu through contractual arrangement as its VIE.

Huishan District Xuanyayue ("xuanyayue") was incorporated on January 22, 2025, in the PRC and is controlled by Park Ha Jiangsu through contractual arrangement as its VIE. Xuanyayue closed down on October 10, 2025.

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***The Forward Share Split and Reverse Share Split***

On June 29, 2024, the Company effected a forward split of its Ordinary Shares at a ratio of 1-for-5. After the forward split, the Company were authorized to issue 2,500,000,000 Ordinary Shares and have 25,000,000 Ordinary Shares issued and outstanding.

On February 9, 2026, the Company announced that it expects to implement a 1-for-50 reverse stock split effective February 20, 2026, subject to the Company's satisfaction of Nasdaq Operations notice requirements, with trading to begin on a split-adjusted basis at the market open on that day.

In connection with the reverse stock split, the Company filed an Amended and Restated Memorandum of Association, with the Registry of Companies of the Cayman Islands on February 4, 2026 to reduce the authorized share capital of the Company from USD 3,000,000.00 divided into divided into 150,000,000,000 ordinary shares of par value US$0.00002 each divided into (i) 120,000,000,000 Class A ordinary shares with a par value of US$0.00002 each with 1 vote per share and (ii) 30,000,000,000 Class B ordinary shares with a par value of US$0.00002 each with 20 votes per share to 3,000,000,000 ordinary shares of par value US$0.001 each divided into (i) 2,400,000,000 Class A ordinary shares with a par value of US$0.001 each with 1 vote per share and (ii) 600,000,000 Class B ordinary shares with a par value of US$0.001 each with 20 votes per share, the reduction at the same ratio as its reduction in the issued and outstanding shares. As approved and authorized by a majority of the shareholders of at an extraordinary meeting of shareholders held on December 26, 2025 the Board of Directors of the Company subsequently approved the reverse stock split and the exact ratio of the reverse stock split on January 29, 2026.

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***The IPO***

In December 2024, we completed an initial public offering in which we offered and sold an aggregate of 1,200,000 Ordinary Shares. Our Ordinary Shares are listed on the Nasdaq Capital Market under the symbol "PHH."

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***2025 Share Incentive Plans***

On February 28, 2025 and July 7, 2025, the board of directors of the Company approved and adopted two equity incentive plans, which collectively authorized 7,500,000 Ordinary Shares to be issued. In March 2025 and July 2025, the Company issued a total of 7,500,000 Ordinary Shares to several consultants of the Company.

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***October 2025 Share Capital Increase and Dual Class Structure***

On October 3, 2025, at the 2025 annual general meeting of shareholders (the "AGM") of the Company, the shareholders of the Company passed resolutions to (i) increase the Company's authorized share capital; (ii) re-classify and re-designate the Company's authorized share capital; and (iii) adopt amended and restated memorandum and articles of association to reflect the share capital increase, the re-classification and share re-designation, and the terms of the re-classified and re-designated shares of the Company. As a result, immediately following the AGM, the Company's authorized share capital was increased, and re-classified and re-designated from US$50,000 divided into 2,500,000,000 Ordinary Shares of par value US$0.00002 each to US$300,000 divided into 12,000,000,000 Class A Ordinary Shares of par value US$0.00002 each, with each Class A Ordinary Share entitled to one vote, and 3,000,000,000 Class B Ordinary Shares of par value US$0.00002 each, with each Class B Ordinary Share entitled to 20 votes.

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***Change of Trading Symbol***

On September 23, 2025, our board of directors approved a change of our trading symbol from "PHH" to "BYAH", which our board of directors believes will have a positive impact on building the Company's long-term brand influence and enhancing our brand value. The symbol change became effective on October 28, 2025.

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***December 2025 Share Capital Increase***

On December 26, 2025, at the 2025 extraordinary general meeting of shareholders (the "EGM") of the Company, the shareholders of the Company passed resolutions to (i) increase the Company's authorized share capital; and (ii) adopt amended and restated memorandum and articles of association to reflect the share capital increase. As a result, immediately following the EGM, the Company's authorized share capital was increased from US$300,000 divided into 12,000,000,000 Class A Ordinary Shares of par value US$0.00002 each, with each Class A Ordinary Share entitled to one vote, and 3,000,000,000 Class B Ordinary Shares of par value US$0.00002 each, with each Class A Ordinary Share entitled to 20 votes, to US$3,000,000 divided into 120,000,000,000 Class A Ordinary Shares of par value US$0.00002 each, with each Class A Ordinary Share entitled to one vote, and 30,000,000,000 Class B Ordinary Shares of par value US$0.00002 each, with each Class B Ordinary Share entitled to 20 votes.

***January 2026 Registered Offering***

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On January 28, 2026, the Company close a best-efforts follow-on public offering of 21,875,000 units (each a "Unit") at an offering price of US$0.112 per Unit. Each Unit consists of one Class A Ordinary Share of the Company, par value US$0.00002 per share and one warrant to purchase one Class A Ordinary Share, or up to nine Class A Ordinary Shares pursuant to the alternative cashless exercise mechanism described therein (each, a "Warrant"). Each Warrant has an exercise price of US$0.112 per Class A Ordinary Share and is exercisable beginning on the issuance date and ending on the one-year anniversary of the issuance date.

The Company received gross proceeds of US$2.45 million. The Company intends to use the proceeds for the expansion of directly operated stores in China.

***Reverse Stock Split***

We received a written notification from Nasdaq on September 2, 2025, notifying us that we are not in compliance with the minimum bid price requirement. To regain compliance, our Ordinary Shares must have a closing bid price of at least US$1.00 for a minimum of 10 consecutive trading days by March 2, 2026. In the event the Company does not regain compliance by March 2, 2026, we are eligible for an additional 180 calendar day period to regain compliance with the minimum bid price requirement. On October 3, 2025, the Company convened its annual general meeting, during which the shareholders of the Company adopted resolutions approving an increase of the Company's share capital and the reverse stock split in a ratio of one (1)-for-thirty (30) of the Company's issued and outstanding Ordinary Shares, as well as the number of authorized Class A Ordinary Shares and Class B Ordinary Shares. On December 26, 2025, the Company convened the extraordinary general meeting, during which the shareholders of the Company adopted resolutions approving an increase of the Company's share capital and the reverse stock split in a ratio of one (1)-for-two hundred and fifty (250) of the Company's issued and outstanding Ordinary Shares, as well as the number of authorized Class A Ordinary Shares and Class B Ordinary Shares. The reverse stock split was to regain compliance with the minimum bid price requirement. Our Class A Ordinary Shares began trading on an adjusted basis, reflecting the reverse stock split, on February 20, 2026, under the existing ticker symbol "BYAH."

The numbers of shares disclosed in this "Our Corporate History and Structure" section prior to this subsection "The Reverse Stock Split" were not adjusted to reflect the reverse stock split. Unless otherwise indicated, all information elsewhere in this annual report reflects the reverse stock split.

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***Corporate Information***

Our principal executive office is located at 901, Building C, Phase 2, Wuxi International Life Science Innovation Campus, 196 Jinghui East Road, Wuxi, Jiangsu Province, People's Republic of China 214100. The telephone number of our principal executive offices is +86-400-012-7562. Our registered office is at Harneys Fiduciary (Cayman) Limited, 4<sup>th</sup> Floor, Harbour Place, 103 South Church Street, P.O. Box 10240, Grand Cayman, KY1-1002, Cayman Islands. Our agent for service for process in the United States is Cogency Global Inc., 122 E 42nd Street 18th Floor, New York, NY 10168.

We are subject to the periodic reporting and other informational requirements of the Exchange Act as applicable to foreign private issuers. 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. The SEC also maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding registrants that make electronic filings with the SEC using its EDGAR system. Such information can also be found on our investor relations website at http://ir.parkha.cn/.

**B. Business overview**

***Overview***

Our business primarily consists of developing our private skincare label, direct skincare products sales and franchise alliances promotions. Our "Park Ha" brand focuses on providing solutions for problematic skin. Established in 2016, the brand had its first store launched in 2017. In addition to the five stores directly operated by Park Ha Jiangsu, as of October 31, 2025, 2024 and 2023, we had 22, 45 and 38 franchisees in China, of which 22, 43 and 36 franchisees operate under the store name "Park Ha". As of October 31, 2025, 2024 and 2023, we had 0, 2 and 2 franchisees operate under a different brand name, "Geni" or "歌妮".

Our PRC subsidiaries specialize in providing skincare and cosmetic products under our brand name "Park Ha" in China. Our PRC subsidiaries develop our proprietary beauty products and offer complimentary after-sales beauty services in our physical stores. Park Ha Jiangsu, in addition to operating our seven physical stores, is the research and development center focusing on skincare products development and improvement for sensitive skin. Xinzhan leads the marketing and promotional efforts and is the entity in charge of our franchising business. Park Ha Jiangsu provides training to our franchisee staff. As part of our value-added service for our products, our directly-operated stores and franchisees offer "light beauty experience", a quick complimentary after-sales beauty service performed in the stores*.* Light beauty experience is offered to our customers as an effective way to demonstrate how our products are used in order to deliver the intended results.

Our revenues mainly consist of (i) products sales and (ii) franchise fees.

As of October 31, 2025, the 22 franchisees locate in the following regions: 16 in Jiangsu Province, 2 in Shandong Province, 1 in Liaoning Province, 1 in Shanxi Province, 1 in Heilongjiang Province, 1 in Hebei Province, forming a complete commercial network.

As of October 31, 2024, the 45 franchisees locate in the following regions: 22 in Jiangsu Province, 5 in Guangdong Province, 4 in Shandong Province, 3 in Shaanxi Province, 1 in Anhui Province, 1 in Liaoning Province, 1 in Shanxi Province, 1 in Hainan Province, 1 in Henan Province, 1 in Heilongjiang Province, 1 in Guizhou Province, 1 in Sichuan Province, 1 in Zhejiang Province, 1 in Tianjin, and 1 in Hebei Province, forming a complete commercial network.

As of October 31, 2023, the 38 franchisees locate in the following regions: 17 stores in Jiangsu Province, 5 stores in Guangdong Province, 4 stores in Shandong Province, 3 stores in Shaanxi Province, 1 store in Anhui Province, 1 store in Liaoning Province, 1 store in Shanxi Province, 1 store in Hainan Province, 1 store in Henan Province, 1 store in Heilongjiang Province, 1 store in Guizhou Province, 1 store in Sichuan Province and 1 store in Zhejiang Province forming a complete commercial network.

***Our Business Model***

Under our retail model, Park Ha Jiangsu provides our products to the franchisees, and Park Ha Jiangsu provides training to the staff of the franchisees. We believe that by creating franchisee chains, Xinzhan provides customers with more effective skincare experiences. Xinzhan's franchisee strategy gives franchisees the option to determine the quantity and timing of the purchase from Xinzhan, thus lowering the franchisees' inventory pressure. Xinzhan provides full training for franchisees' beginner-level staff.

Our operations consist of the following segments:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I. Xinzhan is responsible for the experiential marketing of skincare products to target customers. Store beauticians perform Xinzhan's after-sales service through one-on-one visits by phone or WeChat, giving customers the opportunity to review their purchase on the first day, the third day, and the seventh day after purchasing. We believe that this boosts customers' confidence in the product and encourages future purchases.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;II. Xinzhan also manages the franchisees. It enters into franchisee agreements with our franchisees and operates directly-owned stores.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;III. Park Ha Jiangsu is responsible for providing training to staff working at our franchise stores. We also cooperate with third-party training agencies to provide more professional training to our staff.

Our core operating model has helped us efficiently and quickly build and expand our successful brand and products.

***Our Franchise Model***

Our franchise system is critical to our business operations. As of October 31, 2025, 2024 and 2023, we had 22, 45 and 38 franchisees in China, of which 22, 43 and 36 franchisees operate under the store name "Park Ha". As of October 31, 2025, 2024 and 2023, we had 0, 2 and 2 franchisees operate under a different brand name, "Geni" or "歌妮".

Xinzhan enters into franchise agreements with its franchisees, pursuant to which the franchisees are granted permission to open and operate a store under the brand name "Park Ha" in a specific geographic area. Xinzhan has entered into supplemental agreements with these franchisees that operate stores under the "Geni" or "歌妮" brand, pursuant to which each such franchisee is allowed to keep the existing store name and does not have to change the store name to "Park Ha". The franchisees operating under the "Geni" or "歌妮" brand sell products from the "Park Ha" brand and other third-party brands with Xinzhan's permission. Franchisees must adhere to the proper use of equipment and engage in the sale of authorized skincare or beauty products.

Park Ha Jiangsu provides training to the beauticians of each franchisee. The training courses include skin physiology, "Park Ha" product theory, store operation skills, standardized user manual for stores, procurement and store management. After each training, an assessment of these beauticians is conducted. We also intend to provide training courses for franchisees on subjects that new industry trends in customer development skills, new product releases, and other topics.

Our products are sold under our franchisee's sale models. Franchisees estimate the product sales volume of each month based on the sales records of prior months. Accordingly, they place orders with us based on the expected sales volume. If any product-related problems come up aftersales, the franchisees will consult with us for guidance. Our products carry specific production record-filing certificates and quality inspection reports. In case of product damage due to logistics reasons, the products can be exchanged.

We utilize various channels such as Douyin, Meiye Observation and beautydata.ai (beauty industry websites), Baidu online advertising and other platforms, to publish advertisements highlighting preferential pricing for franchisees to attract potential franchisees. The PRC subsidiaries participate in beauty industry exhibitions and events, such as the China Beauty Expo, where we introduce our products and services and engage in face-to-face communication with potential franchisees. Some existing franchisees also become promoters of the "Park Ha" brand by introducing potential franchisees to us. Additionally, the PRC subsidiaries organize franchise promotion events periodically in physical stores to attract potential franchisees.

Xinzhan is entitled to an annual franchisee fee depending on the size of the franchise, payable within 30 business days from execution of the franchise agreement and within 30 business days of each anniversary date of execution thereafter. Our franchise agreement typically lasts for three years and can be renewed upon both parties' mutual consent. Xinzhan has the right to terminate the franchise agreement for cause if the franchisee is found in breach of the agreement. The franchisees may terminate the franchise agreements early due to business reasons by submitting a written application to Xinzhan for consent.

Furthermore, we offer incentives such as cash subsidies to our regional store franchisees and skin management center franchisees within two weeks upon the entry of franchise agreements/renewals and full payment of the franchise fees. We also require our franchisees to use the cash subsidies for renovation and advertising purposes only. We do not offer any discounts to our franchisees.

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| **Type of Franchisees** | **Annual Franchise Fees** | **Cash Subsidies <br> (limited to <br> renovations and <br> advertising <br> purposes)** | **Area** | **Notes** |
| Regional store | RMB2 million (approximately $278,730) | RMB360,000 | 200 sqm | Territorial exclusivity and a wider variety of products than single store |
| Skin management center | RMB550,000 (approximately $76,650) | RMB50,000 | 200 sqm | a wider variety of products than single store (Starting from the second half of 2025, subsidies will no longer be provided) |
| Single store | RMB100,000 (approximately $13,936) | N/A | 50 sqm |  |

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***Research and Development***

Park Ha Jiangsu is our research and development center focusing on skincare products development and improvement for sensitive skin. We will continue to improve upon and expand our products and services offerings through our research and development and "Industry – University – Research" integration. In the future, we will mainly focus on the development of small molecule peptide hydration penetration technology, as well as providing other products and technologies to solve the problem of skin moisture loss.

Xinzhan and Park Ha Shanghai, as subsidiaries, are deeply involved in supporting research and development, forming a synergistic force. In addition, to meet market demands, the company collaborates with third-party professional institutions to conduct research and development, focusing on exploring the application value and market potential of plant exosomes in the fields of beauty and anti-aging.

***Our Sales and Marketing***

We seek to build an industry-leading platform in the beauty market in China. Since 2021, we have adopted a franchise chain system to supplement our owned stores. We provide our franchisees with training, a stable supply chain to franchisees and a unified guidance strategy for geographical location and market competition.

We believe that our solutions have a strong competitive edge in China's beauty market. Our CEO and CTO each has over ten years of experience in the industry and plays essential roles in reaching out to potential customers. Additionally, we have established a good reputation among our customers through our consistent high-quality products. Due to our reputation in China, we also receive consultation requests and offers from prospective customers.

In addition, we have adopted a digital strategy to better engage with our customers to promote our products through in online communities. This includes launching VR product trials, live online sales and social app advertising. Since 2020, "Park Ha" brand has established its own official account on various popular short video platforms in China including Douyin, RED, and WeChat Video, which has promoted its popularity among the beauty industry and consumers in China. Since 2022, "Park Ha" brand has launched a live channel on Douyin, which promotes products through live activities. By interacting directly with consumers through live streaming and cutting-edge marketing channels, providing instant and customized content access, "Park Ha" brand has created a marketing model that is designed to be effective among beauty consumers in China. To better promote our products, we provide value-added services, complimentary facial treatment trial in stores, where our trained staff give 30 to 45-minute facial treatment sessions to customers who purchase our products. Such sessions are meant to educate our customers about the optimal ways to use our products.

***Our Competitive Advantages***

We believe that we are prepared for continued growth due to several competitive advantages:

*An innovative social marketing model*

We have successfully established a regional brand effect through a social marketing model. We help our franchisees organize local salon activities, build product experience models, offer awards on promotion, and take advantage of our internet promotion, to build brand awareness and drive customers to our trusted community. This, in turn, attracts additional franchisees.

To reach potential customers through social marketing, the PRC subsidiaries hold interest-based community virtual events through the WeChat platform and connect people within the community who are interested in skincare products or knowledge. The PRC subsidiaries promote our products according to our customers' skincare needs. Our social marketing model is designed to stimulate potential customers' desire to buy our products by reaching accurately targeted user groups who are interested in our products through community activities. Since this marketing is carried out within residential communities, we find it easier to build close ties to our target customers through community events in the long run, which we believe enhances our long-term customer loyalty.

*A stable supply chain system*

Our suppliers are located in Guangzhou, Shanghai, Zhejiang Province, and Jiangsu Province in China. The ingredients we use for the product formula are supplied by large international and national raw material companies. We also carry out functional testing and compatibility testing on the raw materials used for packaging of our products to ensure the quality of the ingredients. We conduct supplier visits and factory inspections to check whether the information they provide is accurate and reliable.

*A strong and diversified management team*

Our founders have extensive experience in various industries, including beauty, fashion, retail, and the internet industries. Our CEO and CTO each has over ten years of experience in the industry and plays essential roles in reaching out to potential customers. We believe that their experience, coupled with their profound understanding of the beauty industry and their passion and determination, make them effective business leaders. They are firmly committed to our mission and customer-oriented approach, helping more customers to solve skin problems.

***Our Growth Strategies***

*Strengthening the development of own products*

We plan to expand our partnership with scientific research institutions to develop new skincare raw materials and products. We also plan to expand the scope of services to existing customers and acquire new customers by continually making significant investments in R&D. We will continue to improve upon and expand our products and services offerings through our research and development and technology innovations. In the future, we will mainly focus on the development of small molecule peptide hydration penetration technology, as well as providing other products and technologies to solve the problem of skin moisture loss.

*Intensifying our Training Practice*

We plan to open vocational training schools offering beauty industry knowledge in inland China and western provinces of China, such as Guizhou Province and Ningxia Province. The purpose of the vocational training schools will be to provide professional training to our franchisee staff. We currently have 25 employees in directly owned stores and encourage our franchisees to equip each store with around 4-7 employees.

We also intend to set up an internal training institute on beauty treatment to advance existing talents at the headquarters. We will also establish a set of complete on-the-job training system, where we partner with vocational and technical colleges to provide professional courses and textbooks and help students obtain professional qualification certificates of beautician.

*Enhancing our social media-based sales and marketing capabilities* 

We will continue to seek to improve brand awareness by using social media platforms, such as Douyin, RED and WeChat video, to promote our brand and attract potential future customers and franchisees.

*Improving supply chain capacity*

In order to meet the rapidly growing customer demand, Park Ha Jiangsu has partnered with additional third-party manufacturers to increase production and shorten the wait time. We also plan to establish partnerships with third-party warehouse and distribution centers to support our businesses.

*Seeking strategic investment, acquisition and other cooperation*

We plan to evaluate and selectively seek strategic alliances, investment and acquisition opportunities in the beauty industry across China by investing in incubating product patents and acquiring supply chain partners and manufacturers, as part of our long-term goal to lower production costs and increase future profit margin.

***Our Suppliers***

For the fiscal year ended October 31, 2025, there were two suppliers who accounted for 10% or more of the Company's total purchases and such suppliers accounted for approximately 26%, and 11% of our total purchases, respectively. For the fiscal year ended October 31, 2024, there were four suppliers who accounted for 10% or more of the Company's total purchases and such suppliers accounted for approximately 15%, 11%, 10% and 11% of our total purchases, respectively. For the fiscal year ended October 31, 2023, there was one supplier who accounted for 10% or more of the Company's total purchases and such supplier accounted for approximately 58% of our total purchases.

***Our Customers***

The majority of our customers are franchisees and retail customers in the skincare industry. For the fiscal year ended October 31, 2025, no customer accounted for more than 10% of our total revenue. For the fiscal year ended October 31, 2024, two customers accounted for approximately 10% and 10% of our total revenue, respectively. For the fiscal year ended October 31, 2023, two customers accounted for approximately 10% and 10% of our total revenue, respectively.

As of October 31, 2025, the stores, including directly-operated stores and franchisees, are mostly located in first-, second-, and third-tier cities in various provinces in China, including Jiangsu Province, Shanxi Province, Shandong Province, Liaoning Province, Heilongjiang Province and Hebei Province.

As of October 31, 2025, we had about 6,630 customers in our directly operated stores, all of whom are retail customers. Our products and innovative digital marketing strategy are primarily targeted at young adults and middle-aged generations consisting of women with white-collared occupations. Our primary focus currently is on the female group living or working within 2-3 kilometers of the business district. According to the consumption survey report, 92% of our customers were women. In the future, we will also launch new brands that target male groups across all ages.

***Our Products***

Our subsidiary Park Ha Jiangsu has developed a full range of "Park Ha" brand skincare products by collaborating with biological laboratories and supply chain systems to transform our technology and rich experience into cost-effective functional skincare products.

Our product line ranges from basic skin physical protection, exfoliation, and sebum film repairing to surface microecological balance and anti-aging. Our product line includes nearly 70 products divided into 10 series, covering almost all categories of the skincare industry. Our signature products "Little Blue Injection Serum" and series of freeze-dried powders have been well received by consumers. Our products mainly focus on small molecule peptide compositions, such as palmitoyl pentapeptide-3, palmitoyl tripeptide-1, acetyl hexapeptide-3, acetyl tetrapeptide-5, carnosine, collagen, etc. These substances have a strong permeability and can activate epidermal cells, replenish moisture and nutrients for the skin, stimulate and accelerate the synthesis of collagen, delivering various skincare effects. Our products are not medical graded products and have not been assessed by any medical regulatory authority.

Except for a third-party brand product "whitening and freckle removing freeze-dried powder", all of our products are classified as "ordinary cosmetics" as defined in the Supervision Regulations, which are subject to filing requirements. As of the date of this annual report, the filing with NMPA for all of our products have been completed before they were marketed in accordance with the applicable laws and regulations.

Our primary products are as follows:

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|:---|:---|:---|:---|:---|:---|
| **NO.** | **PRODUCT** | **FUNCTION** | **RETAIL <br> PRICE<br> (RMB)** | **TARGET <br> SKIN** | **PICTURE** |
| **1** | **PARKHA CLEAN AND <br> BALANCED CLEANING <br> GEL** **120ml** | **Containing the filtrate of yeast fermentation products and quadruple hyaluronic acid, it replenishes skin moisture. Deep cleansing, cleansing pores, moisturizing and refreshing skin** | **123** | **All skin type** | ![](ea027833401_img2.jpg) |
| **2** | **PARKHA CLEAN AND<br> BALANCED CLEANING <br> GEL** **500ml** | **Containing the filtrate of yeast fermentation products and quadruple hyaluronic acid, it replenishes skin moisture. Deep cleansing, cleansing pores, moisturizing and refreshing skin** | **293** | **All skin type** | ![](ea027833401_img3.jpg) |
| **3** | **PAPKHA FIBROIN <br> ISOLATION REPAIR <br> MILK** **30ml** | **The texture is refreshing and non-greasy, providing a smooth and hydrating feel. It is easy to apply and blend, without easily smudging or coming off. It adheres closely to the skin, effectively concealing roughness and imperfections, brightening the complexion, and minimizing the appearance of pores. It gives the skin a radiant and translucent glow** | **156** | **All skin type** | ![](ea027833401_img4.jpg) |

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|:---|:---|:---|:---|:---|:---|:---|
| **NO.** | **PRODUCT** | **STANDARD** | **FUNCTION** | **RETAIL <br> PRICE<br> (RMB)** | **TARGET <br> SKIN** | **PICTURE** |
| **4** | **PARKHA<br> METABOLISM<br> ENERGY ESSENCE <br> WATER** | **120ml** | **The product has a fine and smooth texture that is easy to absorb and not sticky. It is formulated with ceramides and high-quality ingredients, combined with a filtrate of yeast fermentation products, to replenish skin moisture, moisturize and moisturize, leaving the skin delicate, hydrated and radiant** | **268** | **All skin type** | ![](ea027833401_img5.jpg) |
| **5** | **PARK HA PERFECT<br> MOISTURIZER CREAM** | **50g** | **It effectively and evenly nourishes the skin, making it hydrated and radiant. It moisturizes and locks in moisture while having a lightweight and non-greasy texture** | **398** | **All skin type** | ![](ea027833401_img6.jpg) |
| **6** | **PARKHA AOUA <br> MOISTURIZING <br> PEPRIDE-INFUSION <br> ESSENCE** | **2ml\*10 bottle** | **It contains a hydrating and nourishing essence that replenishes the skin's moisture and nutrients, relieving dry and rough skin. It smoothens and softens the skin, leaving it hydrated and radiant** | **397** | **Dry, mixed** | ![](ea027833401_img7.jpg) |

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **NO.** | **PRODUCT** | **STANDARD** | **FUNCTION** | **RETAIL <br> PRICE<br> (RMB)** | **TARGET <br> SKIN** | **PICTURE** |
| **7** | **PARKHA AOUA<br> MOISTURIZING <br> PEPRIDE-INFUSION <br> ESSENCE** | **2ml\*30 bottle** | **It contains a hydrating and nourishing essence that replenishes the skin's moisture and nutrients, relieving dry and rough skin. It smoothens and softens the skin, leaving it hydrated and radiant** | **1191** | **Dry, mixed** | ![](ea027833401_img8.jpg) |
| **8** | **PARK HA GANODERMA<br> MOISTURIZING CREAM** | **50g** | **Utilizing patented extraction technology of Ganoderma lucidum, it is pure and concentrated. It deeply nourishes and protects the skin's foundation, caring for the skin's barrier, resulting in a well-hydrated and plump complexion, while maintaining the stability of the skin's condition** | **298** | **Oily, combination to oily skin, acne-prone skin** | ![](ea027833401_img9.jpg) |
| **9** | **PARK HA <br> MUSSEL MOISTURIZING <br> ESSENCE LOTION** | **120ml** | **Containing essence of pearl and a variety of plant extracts, it nurtures and cares for the skin. It improves the dry, rough, and tight state of the skin, increases the skin's moisture content, provides moisturizing care, and strengthens the skin, resulting in a translucent, radiant, and luminous complexion** | **199** | **Oily, combination to oily skin, acne-prone skin** | ![](ea027833401_img10.jpg) |

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|:---|:---|:---|:---|:---|:---|:---|
| **NO.** | **PRODUCT** | **STANDARD** | **FUNCTION** | **RETAIL <br> PRICE<br> (RMB)** | **TARGET <br> SKIN** | **PICTURE** |
| **10** | **PARK HA LACTOSE<br> ACID OIL CONTROL <br> SERUM** | **2ml\*10 bottle** | **Enriched with lactobionic acid tenderizing essence, it improves enlarged pores and rough skin texture. It combines various plant essences to gently rejuvenate the skin, balance the skin's moisture and oil, and promote an even and radiant complexion** | **459** | **Oily, combination to oily skin, acne-prone skin** | ![](ea027833401_img11.jpg) |
| **11** | **PARKHA COLLAGEN <br> ENERGIZING & <br> FIRMING ESSENCE** | **2ml\*10 bottle** | **Using a firming formula to soften the skin, replenish moisture, enhance skin hydration, and improve dryness and roughness; Effectively enhance skin elasticity, improve skin sagging, gradually tighten your skin under daily care, make your skin delicate, smooth, and radiant with charming radiance** | **619** | **All skin types, customers with anti-aging needs** | ![](ea027833401_img12.jpg) |
| **12** | **PARKHA COLLAGEN <br> ENERGIZING &<br> FIRMING ESSENCE** | **30ml** | **Using a firming formula to soften the skin, replenish moisture, enhance skin hydration, and improve dryness and roughness; Effectively enhance skin elasticity, improve skin sagging, gradually tighten your skin under daily care, make your skin delicate, smooth, and radiant with charming radiance** | **449** | **All skin types, customers with anti-aging needs** | ![](ea027833401_img13.jpg) |
| **13** | **YEAST ESSENCE <br> SKIN TREATMENT <br> MILK** | **7g\*10 piece** | **Containing hydrating and nourishing essence, it replenishes skin moisture and nutrients, alleviates dry and rough skin, smoothes and tenderizes the skin, leaving it hydrated and nourished** | **379** | **All skin type** | ![](ea027833401_img14.jpg) |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **NO.** | **PRODUCT** | **STANDARD** | **FUNCTION** | **RETAIL <br> PRICE<br> (RMB)** | **TARGET <br> SKIN** | **PICTURE** |
| **14** | **ANTI-AGING LIFTING <br> GEL** | **18g\*10 piece** | **Provides hydration and nutrients to the skin, repairs and rejuvenates the skin, making it soft, smooth, and firm** | **339** | **All skin type** | ![](ea027833401_img15.jpg) |
| **15** | **YEAST AND PLANT<br> EXTRACT FACIAL <br> TONER** | **3ml\*10 bottle** | **Contains plant extract essence that improves dry and rough skin, making the skin moisturized, tender, and radiant** | **188** | **All skin type** | ![](ea027833401_img16.jpg) |
| **16** | **YEAST AND PLANT <br> EXTRACT FACIAL SET** | **(3ml+7g)\*10** | **It contains a variety of essences, with a natural and hydrating texture. It endows the facial skin with abundant moisture, as if forming a hydrating film on the skin surface. It deeply moisturizes and hydrates, improving the dry and rough condition of the skin caused by water shortage. It makes the skin refreshing, plump, and more moisturized, bringing a comfortable feeling of moisture. It presents a water-like, bright and shiny look, making the facial skin reveal a tender and bright luster, and creating a delicate, hydrated and charming skin** | **567** | **All skin type** | ![](ea027833401_img17.jpg) |
| **17** | **YEAST ESSENCE SKIN <br> TREATMENT MILK** | **7g\*10** | **Contain water replenishing and moisturizing essence, replenish skin moisture and nutrients, relieve dry and rough skin, smooth and tender and moisturize skin** | **379** | **All skin type** | ![](ea027833401_img18.jpg) |
| **18** | **PARKHA<br> ACTIVATING<br> MOISTURIZING<br> MASK** | **28ml\*10P** | **Using soft and skin-friendly Tencel film, the thin film carries a full amount of essence, closely fitting the contours of the skin when applied to the face, as if wrapping the skin with a gentle "water film". The skin appears hydrated** | **268** | **All skin type** | ![](ea027833401_img19.jpg) |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **NO.** | **PRODUCT** | **STANDARD** | **FUNCTION** | **RETAIL <br> PRICE<br> (RMB)** | **TARGET <br> SKIN** | **PICTURE** |
| **19** | **ACNE CLEAN TEA <br> MASK** | **28ml\*10P** | **The thin and breathable sheet adheres closely to the face, providing moisture while being gentle and translucent. It contains various plant extracts that help refine pores, refresh and cleanse the skin, improve skin hydration, and keep the skin moisturized, refreshed, smooth, and delicate** | **199** | **Acne-prone oily skin** | ![](ea027833401_img20.jpg) |
| **20** | **PARKHA COLLAGEN<br> BRIGHTENING <br> ESSENCE MASK** | **5piece** | **The fermentation process contains a recombinant protein expressed by Pichia pastoris, which combines two patented skincare ingredients, glycyrrhizin and β - glucan, to care for beautiful skin, nourish and brighten the skin while increasing skin hydration. It helps improve skin problems such as dehydration, dryness, and roughness, making the skin delicate, translucent, smooth, and radiant** | **268** | **All skin type** | ![](ea027833401_img21.jpg) |
| **21** | **PARKHA SHUIGUANG <br> MASK** | **28ml\*10P** | **It contains ingredients such as sodium hyaluronate and Sophora flavescens root extract, which provide the skin with essential nutrients and moisture, moisturize and hydrate, and care for the skin. It improves dryness and roughness of the skin, leaving it hydrated, radiant, and soft to the touch** | **158** | **All skin type** | ![](ea027833401_img22.jpg) |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **NO.** | **PRODUCT** | **STANDARD** | **FUNCTION** | **RETAIL <br> PRICE<br> (RMB)** | **TARGET <br> SKIN** | **PICTURE** |
| **22** | **UMBILICAL CORD<br> ESSENCE FREEZE-<br> DRIED POWDER** | **(0.05g+3ml)\*10** | **The texture is smooth and easy to spread. It contains (animal) umbilical cord extract, which deeply nourishes the skin, leaving it hydrated and silky smooth** | **1660** | **All skin type** | ![](ea027833401_img23.jpg) |
| **23** | **PARRHA EXTRACT<br> RENEWAL ESSENCE <br> OIL** | **30ml** | **Contains various botanical extracts such as white lotus flower and squalane, improving fine lines and wrinkles caused by skin dehydration, providing deep hydration. The synergistic effect of licorice fruit and Vitamin E enhances radiance, making the skin smooth and translucent** | **228** | **All skin type** | ![](ea027833401_img24.jpg) |
| **24** | **PARK HA REVITALIZE <br> EYE ESSENCE** | **2ml\*10** | **Moisturizes the skin, improves dryness and dehydration, provides intense hydration to the skin around the eyes, revitalizing and rejuvenating it with a fresh and hydrated appearance** | **298** | **All skin type** | ![](ea027833401_img25.jpg) |
| **25** | **PARKHA LIGHT SENSE<br> HUAN LIANG FREEZE <br> DRIED POWDER** | **(50mg+3ml)\*10** | **The texture is smooth and refreshing. effectively brightening the skin and making it fair and luminous. Alpha-arbutin helps reduce skin pigmentation and fade dark spots, resulting in a fair and radiant complexion** | **1430** | **For skin with whitening needs** | ![](ea027833401_img26.jpg) |

---

 ****

***Manufacture of Our Products***

Park Ha Jiangsu engages and commissions third-party manufacturers to produce our products. The engagement specifies that the third-party manufacturers shall purchase raw materials from our designated raw material suppliers. Park Ha Jiangsu does not enter into direct contracts with raw material suppliers.

Pursuant to the Agreement of Commissioned Processing, the third-party manufacturers shall provide the formulas to be used in our products and a packaging material inspection report, produce a manufacture plan in written form, and manufacture and process our products that meet the relevant national standards, industry standards, and our requirements, as well as provide temporary storage of our products. The Agreement of Commissioned Processing also requires us to provide the third-party manufacturers with packaging materials that meet the requirements under applicable laws and regulations such as the Advertising Law and intellectual property regulations. However, given our reliance on our third-party manufacturers to provide us with the formulas for our products and that we do not own the formulas, if we fail to enforce such agreements and if our competitors engage the same manufacturers and introduce the same or similar products at a significantly lower price in the same markets that we operate in, our results of operations may be adversely affected.

Before sending a product for mass production, the third-party manufacturers produce the product samples. Park Ha Jiangsu will conduct internal tests and may improve the formula provided by the third-party manufacturers. In addition, Park Ha Jiangsu engages third-party testing agencies to conduct cosmetics safety testing.

Once the samples pass the third-party testing agency's safety testing, Park Ha Jiangsu will coordinate with the third-party manufacturers to complete the record-filing with the NMPA.

Park Ha Jiangsu has entered into agreements with third-party manufacturers who are responsible for obtaining the raw ingredients for our products and for manufacturing them according to specific product formula used by the third-party manufacturers. We maintain control of the ingredients being used in the process and the quality of finished goods by providing a list of designated ingredients to the third-party manufacturers and carefully examining the products before accepting them. We store excess raw materials with the third-party manufacturers for future use. The third-party manufacturers have obtained and maintained licenses for cosmetic production.

Once the record-filing is completed, the third-party manufacturers will start manufacturing the products.

***Distribution and Warehouse***

The third-party manufacturers deliver the products to our warehouse and Park Ha Jiangsu ships products from the warehouse to the directly operated stores on an as-needed basis and ship products from the warehouse to the franchise stores pursuant to their orders.

Park Ha Jiangsu maintains a warehouse in Wuxi, Jiangsu Province, PRC. Products produced and packaged by third-party manufacturers are delivered by third-party logistics companies directly from the production site to Park Ha Jiangsu's warehouse. Park Ha Jiangsu pays for the freight. The warehouse stores the products in a dry environment and away from direct sunlight.

***Our Stores***

Our stores are generally located in commercial complexes in urban centers in China. As of October 31, 2025, our five directly operated stores are located in Wuxi Xinwu Wanda Plaza, No.31 Zhenze Road,Xinwu District ,Wuxi Starlight Life Plaza,No.3 Qianwei Road,Xinwu District,Shop No. 433 at 30.39-401,Coastal City, Economic Development Zone,B161A at No. 88 Jinshi Road, Binhu District, Wuxi Mixc Mall,No.88 Jinshi Road,Binhu District and 59-103 at Bafanghui,Wuxi, Jiangsu Province, PRC, the areas of which are 66.30 square meters, 53.64 square meters,78.8 square meters ,49 square meters and 58.83 square meters, respectively. Each of the directly operated stores has a product sample area and a product experience area. We sell our products in the stores and provide complimentary after-sales beauty services. As of October 31, 2025, we have a total of 25 employees working in our five directly operated stores.

***Digital Customer Engagement Strategy***

We believe that Chinese consumers expect to have a more intimate product use experience offered by beauty brands on social media platforms. Many local skincare enterprises in China also promote their products by increasing their marketing investment in online communities, such as launching VR product trials, live online sales, social app advertising. Since 2020, "Park Ha" brand has established its own official account on various popular short video platforms in China including Douyin, RED, and WeChat Video, which has promoted its popularity among the beauty industry and consumers in China. Since 2022, "Park Ha" brand has launched a live channel on Douyin, which promotes products through live activities. By interacting directly with consumers through live streaming and cutting-edge marketing channels, providing instant and customized content access, we believe that the "Park Ha" brand has created a marketing model that is widely effective among beauty consumers in China.

***Our Online to Offline***

We believe that we should leverage both e-commerce platforms and brick-and-mortar shops to create an omnichannel seamless shopping experience for our customers. Therefore, we constructed our Online-to-Offline ("O2O") business model in January 2017. Specifically, we use various e-commerce strategies, such as click-and-collect service (i.e., offering our customers the option to purchase products online and pick them up in-store), and offering digital coupons to attract customers on social media platforms (e.g., Douyin and Meituan, two of the largest social media platforms in China) to visit our physical stores and encourage them to purchase our products. We also offer group-buying deals, which refers to a group of customers coming together to purchase products at discounted prices. We offer group-buying deals on social media platforms, including aforementioned platforms like Douyin and Meituan, and we would require a minimum number of purchasers for the discounted price to apply. We believe that our O2O Model has enabled us to reach a wider audience online, attract new customers, engage with customers across multiple channels, and increase sales while our customers can enjoy significant discounts and a seamless shopping experience.

Through holding events for customers to experience products under the "Park Ha" brand, stores promote and sell our skincare products. Our online order system is open to our franchisees to place orders.

We believe that through our physical stores, we have built a closer relationship with our customers to enhance their experience with Park Ha products. Generally, each of our physical stores has a prominent product trial area at the front of the store to showcase all of our products. We also train and employ several aestheticians to answer customers' questions related to skin problems and provide skincare advice accordingly. The stores have set up a storage area for centralized storage of products and fulfillment of short-term orders from customers.

![](ea027833401_img27.jpg)

***Quality Control***

We have a comprehensive quality assurance program designed to ensure product quality and safety throughout the procurement and production cycle. Park Ha Jiangsu outsources our product manufacture process to third-party ingredients suppliers and manufacturers, who shall follow our guidelines and product formula in production. We have strict control over the ingredients choices and the quality of finished goods. Each batch of products will only be produced after we have examined the sample product from the third-party manufacturers and approved its quality. During the quality control process, we perform a series of functionality, stability, and compatibility tests on the designed packaging materials and product components under various strict conditions.

In addition, we implement a rigorous on-site audit program to ensure that third-party raw material suppliers comply with the product safety compliance standards in China. We take great care to ensure that third-party suppliers of raw materials share our commitment to quality and ethics. Given the experience of our third-party manufacturers in supplying high-end and luxury beauty brands around the world, they generally establish high-quality production standards to ensure that the product quality meets the stringent standards we set.

We ensure consistency in our manufacturing quality through regular on-site inspections and audits of third-party manufacturers and ingredients suppliers. We have a policy of terminating our cooperation with partners that do not meet our quality standards.

***Our Delivery, Return and Exchange Policies***

Our delivery policy is as follows: on the 15<sup>th</sup> and 30<sup>th</sup> of each month, deliveries of our products are made by Park Ha Jiangsu to various stores within the Wuxi urban area. Deliveries to stores outside the Wuxi urban area are sent through Deppon Logistics Express, SF Express and YTO Express.

Our return and exchange policy dictates that within three months from the delivery of the initial inventory listed for each store, products within their shelf life can be exchanged for other products of up to 10% of the total value. For products purchased at the stores within one month before the expiration of the warranty period, free returns and exchanges are accepted.

***Our Competition***

We compete with both established multinational and domestic brands, as well as smaller niche brands in both the PRC market and the global beauty market. Some of our largest competitors are Fanwenhua, DR PLANT, and Beauty Farm, each of whom has over 100 franchisees nationwide. They have a longer operating history and relatively higher market share than us, and have established brand recognition and a strong reputation in the market. Therefore, we may have trouble gaining visibility and credibility among consumers. Besides, larger and more established companies tend to benefit from economies of scale, which allows them to produce goods at lower costs per unit. This could result in pricing advantages, making it difficult for us to compete on price while maintaining profitability. We believe that we compete primarily based on perceived value, including pricing and innovation, product efficacy, service to the customer, promotional activities, advertising, special events, new product introductions, e-commerce initiatives, direct sales, and other activities. It is difficult for us to predict the timing, scale, and effectiveness of our competitors' actions in these areas or the timing and impact of new entrants into the marketplace.

***Insurance***

We carry director and officer insurance for our Chief Executive Officer, Chief Financial Officer and directors. We will continue to review and assess our risk portfolio and make necessary and appropriate adjustments to our insurance practices to align with our needs and with industry practice in the markets in which we operate. We do not maintain any insurance to cover our assets, operations and any loss arising from business interruptions.

***Intellectual Property***

Protecting our intellectual property is a priority of our business. We rely on trademarks, patents, and know-how, as well as contractual restrictions on information disclosure to protect our intellectual property rights. We have signed confidentiality agreements or clauses with our executives, certain customers, and suppliers, and rely on such confidentiality agreements or clauses and other protections of our technical knowledge to maintain our technological advantages in products and designs. As of the date of this annual report, Park Ha Jiangsu and Xinzhan have a total of 20 registered trademarks, 12 registered patents, 7 registered copyrights, and 1 domain name. All of them are in China.

As we engage third-party manufacturers to manufacture our products on our behalf, we rely on the formulas provided by these third-party manufacturers commissioned by us. Under our current commissioned processing agreements with our third-party manufacturers, we do not own the formulas for our products. Given our reliance on our third-party manufacturers to provide us with the formulas for our products and that we do not own the formulas, if we fail to enforce such agreements and if our competitors engage the same manufacturers and introduce the same or similar products at a significantly lower price in the same markets that we operate in, our results of operations may be adversely affected.

***Trademarks***

The following table sets forth a brief description of Park Ha Jiangsu and Xinzhan's trademarks as of the date of this prospectus, all of which are registered in China:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Trademark <br> Number** | **File Date** | **Trademark Name** | **Status** | **Expiration<br> Date** | **Owner** |
| 40583272 | 2020/5/21 | ![](ea027833401_img28.jpg) | Granted | 2030.5.20 China | Park Ha Jiangsu |
| 19552102 | 2017/5/21 | ![](ea027833401_img29.jpg) | Granted | 2027.5.20 China | Xinzhan |
| 52389822 | 2021/12/21 | ![](ea027833401_img30.jpg) | Granted | 2031.12.20 China | Xinzhan |
| 52369491 | 2021/9/21 | ![](ea027833401_img31.jpg) | Granted | 2031.9.20 China | Xinzhan |
| 52374721 | 2021/9/21 | ![](ea027833401_img32.jpg) | Granted | 2031.9.20 China | Xinzhan |
| 52331512 | 2021/11/28 | ![](ea027833401_img33.jpg) | Granted | 2031.11.27 China | Xinzhan |
| 51586756 | 2021/8/14 | ![](ea027833401_img34.jpg) | Granted | 2031.8.13 China | Xinzhan |
| 51578063 | 2021/7/21 | ![](ea027833401_img35.jpg) | Granted | 2031.7.20 China | Xinzhan |
| 49183046 | 2021/8/21 | ![](ea027833401_img36.jpg) | Granted | 2031.8.20 China | Xinzhan |
| 44201869 | 2020/10/21 | ![](ea027833401_img37.jpg) | Granted | 2030.10.20 China | Xinzhan |
| 31045437 | 2019/5/21 | ![](ea027833401_img38.jpg) | Granted | 2029.5.20 China | Xinzhan |
| 31035182 | 2019/2/28 | ![](ea027833401_img39.jpg) | Granted | 2029.2.28 China | Xinzhan |
| 26363194 | 2018/9/28 | ![](ea027833401_img40.jpg) | Granted | 2028.9.27 China | Xinzhan |
| 25600575 | 2018/7/28 | ![](ea027833401_img41.jpg) | Granted | 2028.7.27 China | Xinzhan |
| 24916764 | 2018/6/21 | ![](ea027833401_img42.jpg) | Granted | 2028.6.20 China | Xinzhan |
| 24923602 | 2018/6/21 | ![](ea027833401_img43.jpg) | Granted | 2028.6.20 China | Xinzhan |
| 24919892 | 2018/6/21 | ![](ea027833401_img44.jpg) | Granted | 2028.6.20 China | Xinzhan |
| 19552028 | 2017/5/28 | ![](ea027833401_img45.jpg) | Granted | 2027.5.27 China | Xinzhan |
| 19552238 | 2017/5/28 | ![](ea027833401_img46.jpg) | Granted | 2027.5.27 China | Xinzhan |
| 19552309 | 2017/5/21 | ![](ea027833401_img47.jpg) | Granted | 2027.5.20 China | Xinzhan |

---

***Patents***

The following table sets forth a brief description of Park Ha Jiangsu's utility model patents as of the date of this prospectus, all of which are registered in China:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Patent Number** | **File Date** | **Issue Date** | **Expiration <br> Date** | **Title** | **Status** |
| ZL202220091842.2 | 2022.1.13 | 2022.8.26 | 2032.1.12 | A kettle type device for fine chemical reaction | Effective |
| ZL202220087676.9 | 2022.1.13 | 2022.8.26 | 2032.1.12 | A filter device for biofiltration | Effective |
| ZL202220088104.2 | 2022.1.13 | 2022.8.26 | 2032.1.12 | A high-efficiency chemical material mixing equipment for deep-processing reaction | Effective |
| ZL202123449958.3 | 2021.12.31 | 2022.9.20 | 2031.12.30 | A biological response kettle | Effective |
| ZL202220087588.9 | 2022.1.13 | 2022.08.26 | 2032.1.12 | A Natural Effective Ingredients Extraction Equipment | Effective |
| ZL202223446372.6 | 2022.12.22 | 2023.3.21 | 2032.12.21 | A biomass continuous dry distillation equipment | Effective |
| ZL202222184931.4 | 2022.8.19 | 2023.10.20 | 2032.8.18 | A biological denitrification equipment | Effective |
| ZL202322585783.1 | 2023.9.22 | 2024.4.30 | 2033.9.21 | A biomass pressing device | Effective |
| ZL202322299499.8 | 2023.8.25 | 2024.3.26 | 2033.8.24 | A deep mixing bioreactor | Effective |
| ZL202322268335.9 | 2023.8.22 | 2024.3.26 | 2033.8.21 | A cooling and screening device for biochemical applications | Effective |
| ZL202210977506.2 | 2022.08.15 | 2024.05.24 | 2032.08.14 | A biological nanofilm dust suppression device | Effective |
| ZL202322265294.8 | 2023.08.22 | 2024.05.24 | 2033.8.21 | A biochemical experimental platform | Effective |

---

***Copyrights***

The following table sets forth a brief description of Park Ha Jiangsu's software copyrights as of the date of this prospectus, all of which are registered in China:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Copyright Number** | **Issue Date** | **Expiration <br> Date** | **Category** | **Copyright Name** | **Owner** |
| 2021SR2206930 | 2021.12.29 | 2071.12.31 | Software | A plant harmful component detection system basing on big data analysis V1.0 | Park Ha Jiangsu |
| 2021SR2206932 | 2021.12.29 | 2071.12.31 | Software | A microbial culture environment data analysis system | Park Ha Jiangsu |
| 2021SR2206931 | 2021.12.29 | 2071.12.31 | Software | An online trading system for biosynthetic prepared products based on block chain technology | Park Ha Jiangsu |
| 2021SR2211374 | 2021.12.29 | 2071.12.31 | Software | A bioactive substance synthesis system based on artificial intelligence technology | Park Ha Jiangsu |
| 2021SR2211375 | 2021.12.29 | 2071.12.31 | Software | An herbal essence extraction control system based on AI technology | Park Ha Jiangsu |
| 2025SR0388978 | 2025.03.05 | 2075.12.31 | Software | Puhua Biological Skin Barrier Repair Technology Repair Process Tracking Software V1.0 | Park Ha Jiangsu |
| 2025SR0388956 | 2025.03.05 | 2075.12.31 | Software | Puhua Biological Collagen Peptide Gel Synthesis Process Control Software V1.0 | Park Ha Jiangsu |

---

***Domain***

Through Xinzhan, we currently have the right to use one domain name that is registered and issued in the PRC, as follows:

---

| | | |
|:---|:---|:---|
| **Number** | **Domain Name** | **Owner** |
| 1 | parkha.cn | Xinzhan |

---

***Regulations***

This section sets forth a summary of the most significant rules and regulations that affect our business activities in China.

*Regulatory Authorities*

The National Medical Products Administration, or the NMPA, under the SAMR, is the government authority that monitors and supervises the administration of cosmetics, medical devices, and foods. The NMPA's predecessor, the China Food and Drug Administration was established in March 2013 and separated from the Ministry of Health of the PRC, or the MOH, as part of an institutional reform of the State Council.

*Regulations Relating to Cosmetic Products*

Pursuant to the Regulations Concerning the Hygiene Supervision over Cosmetics Products, "Hygiene Regulations"), which was promulgated by the former MOH on November 13, 1989 and most recently amended on March 2, 2019, cosmetic products are divided into special purpose cosmetic products and non-special purpose cosmetic products. The Supervision Regulations was promulgated by the State Council on June 16, 2020, and became effective on January 1, 2021, which replaced the Hygiene Regulations. Compared with the Hygiene Regulations, the Supervision Regulations and its implementation rules (including Measures for the Administration of the Registration and Record Filing of Cosmetics, which was promulgated by the SAMR on January 7, 2021 and became effective on May 1, 2021) clarify or amend certain provisions including without limitation the follows:

&nbsp;&nbsp;&nbsp;&nbsp;(i) Responsibilities of the
 different parties in the operation of cosmetics. The Supervision Regulations for the first time introduce the concepts of registrant
 and record-filing applicant of cosmetics. The applicant for registration or record-filing of cosmetics shall undertake the main responsibilities
 for the quality, safety and effectiveness claims of cosmetics. Specifically, an applicant for registration or record-filing of cosmetics
 shall be responsible for the registration or record-filing before sale of such cosmetics, the monitoring of adverse reactions, the
 evaluation and reporting, product risk control and recall, and safety re-evaluation of the products and raw materials after sale
 of such cosmetics to ensure quality and safety of the registered/filed products. In addition, the claims for the effectiveness of
 all types of cosmetics shall be supported by sufficient scientific basis and an extract of the papers, research data or product evaluation
 material on which such effectiveness is claimed to be based shall be made public on websites designated by the regulatory authority.
 An applicant registering or record-filing the record for cosmetics shall be subject to the supervision of the NMPA.

&nbsp;&nbsp;&nbsp;&nbsp;(ii) Categories of cosmetics.
 Cosmetics are divided into special cosmetics and ordinary cosmetics, instead of special purpose cosmetic products and non-special
 purpose cosmetic products. Special cosmetics refer to products for hair coloring, hair perming, freckle removal and skin whitening,
 sunscreen, and hair loss prevention as well as those purporting to have new functions and effects, such as antioxidant, blue light
 protection, anti-pollution, pH balance, antiperspirant, and sweat control. Ordinary cosmetics refer to cosmetics other than special
 cosmetics. The NMPA implements registration management for special cosmetics and record-filing management for ordinary cosmetics.
 Special cosmetics may not be produced and imported unless they have been registered with the NMPA. Domestic ordinary cosmetics shall
 be filed with the provincial drug regulatory authority where the record-filing applicant is located before going on sales.

&nbsp;&nbsp;&nbsp;&nbsp;(iii) Production of cosmetics.
 In case of entrusting a third party to manufacture, a registrant or record-filing applicant of cosmetics shall entrust an entity
 that has obtained corresponding cosmetics manufacturing license and supervise the manufacture.

Violations of the Supervision Regulations will result in different penalties ranging from fines (fixed range or, in cases of severe violations, based on the values of the illegally manufactured goods), confiscation of raw materials, products illegally manufactured or sold and illegally obtained gains, revoking licenses, and suspension of business. Furthermore, pursuant to the Supervision Regulations, the responsible individual shall be subject to an industry operation banning period for five or ten years or even criminal liability.

Pursuant to the Provisions for Supervision and Administration of Manufacturing and Marketing of Cosmetics, which was promulgated by the SAMR on August 2, 2021, and became effective on January 1, 2022, and other applicable laws, to engage in manufacturing of cosmetics, the Cosmetics Manufacturing License shall be obtained in accordance with the law. If the registrant or the record-filing entity of cosmetics entrusts manufacturing of cosmetics, it shall entrust one that has obtained the manufacturing license for the relevant cosmetics. The contract manufacturer shall have the corresponding manufacturing conditions.

According to the Good Manufacturing Practice for Cosmetics, which was issued on January 6, 2022 and became effective on July 1, 2022, applicants and appointed manufacturers shall establish a production quality management system in accordance with the requirements to ensure the continuous and stable production of cosmetics that meet the relevant quality and safety requirements.

The Provisions on the Supervision and Administration of Enterprises' Implementation of Primary Responsibilities for Cosmetics Quality and Safety, "Supervision Provisions") was promulgated by the NMPA on December 29, 2022 and became effective from March 1, 2023. The Supervision Provisions emphasize that, a registrant or record-filing applicant, commissioned manufacturing enterprises of cosmetics shall be responsible for the quality, safety and effectiveness claims of cosmetics and shall manage the quality, safety of cosmetics registered or filed by them in the whole process from the research, development, production, and operation of cosmetics. Furthermore, the legal representative of the registrant, record-filing applicant and commissioned manufacturing enterprises of cosmetics shall be fully responsible for the quality and safety work of cosmetics.

According to the Measures for the Administration of Cosmetic Labels, which was issued on May 31, 2021 and became effective on May 1, 2022, the smallest sales unit of cosmetics shall be labeled. The labels shall comply with the requirements of the relevant laws, administrative regulations, departmental rules, compulsory national standards and technical specifications. The contents of the labels shall be lawful, authentic, complete, accurate and consistent with the relevant contents registered or filed.

*Regulations Relating to Online Trading and E-Commerce*

On March 15, 2021, the SAMR promulgated the Measures for the Supervision and Administration of Online Transactions, which became effective on May 1, 2021, to regulate all operating activities for product sales and services offered via the internet (including mobile internet). It stipulates the obligations of online products operators and services providers and certain special requirements applicable to third-party platform operators.

On August 31, 2018, the SCNPC promulgated the E-Commerce Law of the PRC, or the E-Commerce Law, which became effective on January 1, 2019. The promulgation of the E-Commerce Law established the basic legal framework for the development of China's e-commerce business and clarified the obligations of the e-commerce business operators and the possible legal consequences if e-commerce business operators are found to be in violation of legal obligations. For example, pursuant to the E-Commerce Law, the e-commerce business operators shall disclose information about goods or services provided comprehensively, truthfully, accurately and promptly in order to protect the consumers' rights to know and rights to choose. The e-commerce business operators shall not fabricate transactions or users' comments to conduct false or misleading business promotions so as to defraud or mislead consumers. Violation of the provisions of the E-Commerce Law may result in being ordered to make corrections within a prescribed period of time, confiscation of illegally obtained gains, fines, suspension of business, inclusion of such violations in the credit records and possible civil liabilities.

*Regulations on Product Quality and Consumers Protection*

According to the Product Quality Law of the PRC, which took effect on September 1, 1993 and was amended by the SCNPC on July 8, 2000, August 27, 2009 and December 29, 2018 respectively, products for sale must satisfy relevant safety standards and sellers shall adopt measures to maintain the quality of products for sale. Sellers may not mix impurities or imitations into products, or pass counterfeit goods off as genuine ones, or defective products as good ones or substandard products as standard ones. For sellers, any violation of state or industrial standards for health and safety or other requirements may result in civil liabilities and administrative penalties, such as compensation for damages, fines, confiscation of products illegally manufactured or sold and the proceeds from the sales of such products illegally manufactured or sold and revoking business license; in addition, severe violations may subject the responsible individual or enterprise to criminal liabilities.

According to the Consumers Rights and Interests Protection Law of the PRC, or the Consumers Rights and Interests Protection Law, which became effective on January 1, 1994 and was amended by the SCNPC on August 27, 2009 and October 25, 2013, respectively, business operators should guarantee that the products and services they provide satisfy the requirements for personal or property safety, and provide consumers with authentic information about the quality, function, usage and term of validity of the products or services. The consumers whose interests have been damaged due to the products or services that they purchase or receive on the internet trading platforms may claim damages against sellers or service providers. Where the operators of the online trading platforms are unable to provide the real names, addresses and valid contact details of the sellers or service providers, the consumers may also claim damages against the operators of the online trading platforms. Operators of online trading platforms that clearly knew or should have known that sellers or service providers use their platforms to infringe upon the legitimate rights and interests of consumers but fail to take necessary measures must bear joint and several liabilities with the sellers or service providers. Moreover, if business operators deceive consumers or knowingly sell substandard or defective products, they should not only compensate consumers for their losses, but also pay additional damages equal to three times the price of the goods or services.

On January 6, 2017, the SAIC issued the Interim Measures for Seven-day Unconditional Return of Online Purchased Goods, which became effective on March 15, 2017, and was amended by the SAMR on October 23, 2020, took effect on the same day, further clarifying the scope of consumers' rights to make returns without reason, with exceptions, return procedures and online trading platform operators' responsibility to formulate seven-day unconditional return rules and related consumer protection systems, and supervise the merchants for compliance with these rules.

*Regulations on Commercial Franchising*

Franchise operations are subject to the supervision and administration of the MOFCOM, and its regional counterparts. Such activities are currently regulated by the Administrative Regulations on Commercial Franchising, which was promulgated by the State Council on February 6, 2007 and became effective on May 1, 2007. The Administrative Regulations on Commercial Franchising were subsequently supplemented by the Administrative Measures on Filing of Commercial Franchises, which was amended and promulgated by the MOFCOM on December 12, 2011, became effective on February 1, 2012 and was most recently amended on December 29, 2023, and the newly amended Administrative Measures on Information Disclosure of Commercial Franchises, which was promulgated by the MOFCOM on February 23, 2012 and became effective on April 1, 2012.

Under the above applicable regulations, a franchisor must have certain prerequisites including a mature business model, the capability to provide long-term business guidance and training services to franchisees and ownership of at least two self-operated storefronts that have been in operation for at least one year within China. Franchisors engaged in franchising activities without satisfying the above requirements may be subject to penalties such as forfeit of illegal income and imposition of fines between RMB100,000 and RMB500,000 and may be bulletined by the MOFCOM or its local counterparts. Franchise contracts shall include certain required provisions, such as terms, termination rights and payments.

Franchisors are generally required to file franchise contracts with the MOFCOM or its local counterparts. Failure to report franchising activities may result in penalties such as fines up to RMB100,000. Such non-compliance may also be bulletined. In the first quarter of every year, franchisors are required to report to the MOFCOM or its local counterparts any franchise contracts they executed, canceled, renewed or amended in the previous year.

The term of a franchise contract shall be no less than three years unless otherwise agreed by franchisees. The franchisee is entitled to terminate the franchise contract in his sole discretion within a set period of time upon signing of the franchise contract.

Pursuant to the Administrative Measures on Information Disclosure of Commercial Franchises, 30 days prior to the execution of franchise contracts, franchisors are required to provide franchisees with copies of the franchise contracts, as well as written true and accurate basic information on matters including:

● the name, domiciles, legal representative, registered capital, scope of business and basic information relating to its commercial franchising;

● basic information relating to the registered trademark, logo, patent, know-how and business model;

● the type, amount and method of payment of franchise fees (including payment of deposit and the conditions and method of refund of deposit);

● the price and conditions for the franchisor to provide goods, service and equipment to the franchisee;

● the detailed plan, provision and implementation plan of consistent services including operational guidance, technical support and business training provided to the franchisee;

● detailed measures for guiding and supervising the operation of the franchisor;

● investment budget for all franchised hotels of the franchisee;

● the current numbers, territory and operation evaluation of the franchisees within China;

● a summary of accounting statements audited by an accounting firm and a summary of audit reports for the previous two years;

● information on any lawsuit in which the franchisor has been involved in the previous five years;

● basic information regarding whether the franchisor and its legal representative have any record of material violation; and

● other information required to be disclosed by the MOFCOM.

In the event of failure to disclose or misrepresentation, the franchisee may terminate the franchise contract and the franchisor may be fined up to RMB100,000. In addition, such non - compliance may be bulletined.

According to the Manual of Guidance on Administration for Foreign Investment Access (Edition 2008) promulgated by the MOFCOM in December 2008, if an existing FIE wishes to operate a franchise in China, it must apply to the MOFCOM or its local counterparts and must include "engaging in commercial activities by way of franchise" in its business scope.

*Regulations on Advertising*

In 1994, the SCNPC promulgated the Advertising Law of the PRC, or the Advertising Law, which was recently amended on April 29, 2021 and became effective on the same date. The Advertising Law regulates commercial advertising activities in the PRC and sets out the obligations of advertisers, advertising operators, advertising publishers and advertisement endorsers, and prohibits any advertisement from containing any obscenity, pornography, gambling, superstition, terrorism or violence-related content. Any advertiser in violation of such requirements on advertisement content will be ordered to cease publishing such advertisements and imposed a fine, the business license of such advertiser may be revoked, and the relevant authorities may revoke the approval document for advertisement examination and refuse to accept applications submitted by such advertiser for one year. In addition, any advertising operator or advertising publisher in violation of such requirements will be imposed a fine, and the advertisement fee received will be confiscated; in severe circumstances, the business license of such advertising operator or advertising publisher may be revoked.

The Administrative Measures for Online Advertising were adopted by the SAMR on February 25, 2023 and became effective on May 01, 2023. According to the Administrative Measures for Online Advertising, Advertisers shall be responsible for the truthfulness of the content of their online ads. An online ad shall be identifiable so that it can be clearly identified by consumers as an advertisement. The publication or delivery of an ad through the Internet must not affect users' normal use of the network. It is prohibited to deceive or mislead users into clicking or browsing an ad through the following means: (1) any false system or software update, error or cleanup prompts or other notifications; (2) any false Play, Start, Pause, Stop, Return, or other symbols; (3) any false promises of a reward; or (4) any other means of deceiving or misleading users into clicking or browsing an ad. It is prohibited to deliver any online ad to any means of transport, navigation equipment, smart home appliance, etc., of a user without the user's consent or the user's request, or when the user has expressly refused consent, and it is prohibited to add any ad or ad link to an email or online instant message sent by users. Product sellers or service providers who markets any product or service through livestreaming on the Internet, which constitutes a commercial advertisement, shall legally bear the responsibilities and obligations of advertisers. Livestream room operators engaged to provide advertising design, production, agency, or publishing services shall legally bear the responsibilities and obligations of advertising agents or advertising publishers. Livestream marketers engaged to provide advertising design, production, agency, or publishing services shall legally bear the responsibilities and obligations of advertising agents or advertising publishers. Livestream marketers who recommend or endorse any product or service using their own name or image, which constitutes an advertising endorsement, shall legally bear the responsibilities and obligations of advertising spokespersons.

*Regulations on Leasing*

Under the Law of the PRC on Administration of Urban Real Estate promulgated by the SCNPC, which took effect as of January 1995 and was amended in August 2007, August 2009 and January 2020, respectively, and the Administrative Measures on Leasing of Commodity House promulgated by the Ministry of Housing and Urban- rural Construction, which took effect as of February 1, 2011, when leasing premises, the lessor and lessee are required to enter into a written lease contract, prescribing such provisions as the leasing term, use of the premises, rental and repair liabilities, and other rights and obligations of both parties. Both lessor and lessee are also required to go through registration procedures to record the lease with the real estate administration department. Pursuant to these laws and regulations and various local regulations, if the lessor and lessee fail to go through the registration procedures, both lessor and lessee may be subject to fines, and the leasing interest may be subordinated to an interested third party acting in good faith.

On May 28, 2020, the Civil Code of the People's Republic of China (the "Civil Code") was promulgated by the National People's Congress, and the Civil Code came into effect on January 1, 2021 and replaced the Property Law, the Contract Law of the PRC and several other basic civil laws in the PRC. According to the Civil Code, subject to consent of the lessor, the lessee may sublease the leased item to a third party. Where the lessee subleases the lease item, the leasing contract between the lessee and the lessor remains valid. The lessor is entitled to terminate the contract if the lessee subleases the lease item without the consent of the lessor. Where a lessor knows or should have known of the sublease made by a lessee but fails to raise any objection within six months, the lessor is deemed to have consented to the sublease. Pursuant to the Civil Code, where a mortgagor leases the mortgaged property before the mortgage contract is concluded, the previously established leasing relation shall not be affected; and where a mortgagor leases the mortgaged property after the creation of the mortgage interest, the leasing interest will be subordinated to the registered mortgage interest.

*Regulations on Intellectual Property Rights*

The PRC Copyright Law, which took effect on June 1, 1991 and last amended on November 11, 2020, provides that Chinese citizens, legal persons, or other organizations shall, whether published or not, own copyright in their copyrightable works, which include, among others, works of literature, art, natural science, social science, engineering technology and computer software. Copyright owners enjoy certain legal rights, including right of publication, right of authorship and right of reproduction. The Copyright Law extends copyright protection to Internet activities, products disseminated over the Internet and software products. In addition, the Copyright Law provides for a voluntary registration system administered by the China Copyright Protection Center. According to the Copyright Law, an infringer of the copyrights shall be subject to various civil liabilities, which include ceasing infringement activities, apologizing to the copyright owners and compensating the loss of copyright owner. Infringers of copyright may also be subject to fines and/or administrative or criminal liabilities in severe situations.

Pursuant to the Computer Software Protection Regulations promulgated by the State Council on June 4, 1991 and last amended on January 30, 2013, Chinese citizens, legal persons and other organizations shall enjoy copyright on software they develop, regardless of whether the software is released publicly. Software copyright commences from the date on which the development of the software is completed. The protection period for software copyright of a legal person or other organizations shall be 50 years, concluding on December 31 of the 50th year after the software's initial release. The software copyright owner may go through the registration formalities with a software registration authority recognized by the State Council's copyright administrative department. The software copyright owner may authorize others to exercise that copyright and is entitled to receive remuneration.

Both the Trademark Law of the PRC adopted by the SCNPC on August 23, 1982 and last amended on November 1, 2019, and the Implementation Regulation of the Trademark Law of the PRC adopted by the State Council on August 3, 2002 and revised on April 29, 2014 give protection to the holders of registered trademarks and trade names. The National Intellectual Property Administration (Trademark Office) handles trademark registrations. Trademarks can be registered for a term of ten years and can be extended for another ten years if requested upon expiration of any ten-year term. Trademark license agreements must be filed with the Trademark Office.

According to the Administrative Measures on Internet Domain Names promulgated by the Ministry of Industry and Information Technology of PRC on August 24, 2017 and took effect on November 1, 2017. The registration of domain names in PRC is on a "first-apply-first-registration" basis. A domain name applicant will become the domain name holder upon the completion of the application procedure.

Pursuant to the PRC Patent Law which was promulgated by the SCNPC on March 12, 1984 and last amended on October 17, 2020, and its implementation rules, once a patent for an invention or utility model has been granted, unless otherwise provided by the Patent Law, no entity or individual may use the patent, patented product or patented process for production or business purposes without the authorization of the patent owner. Once a patent has been granted for a design, no entity or individual may manufacture, sell or import any product containing the patented design without the permission of the patent owner. If a patent is found to have been infringed, the infringer must, in accordance with relevant regulations, cease such infringement, take remedial action and pay damages.

*Regulations on Foreign Currency Exchange*

The principal regulations governing foreign currency exchange in China are the Foreign Exchange Control Regulations of the PRC promulgated by the State Council, as amended on August 5, 2008, or the Foreign Exchange Regulations. Under the Foreign Exchange Regulations, the RMB is freely convertible for current account items including goods, services, gains and transaction items, but not for capital account items, such as capital transfers, direct investments, investment in securities, derivatives and loans, unless the prior approval of the SAFE, is obtained and prior registration with the SAFE is made.

The Circular on Reforming the Management Method regarding the Settlement of Foreign Exchange Capital of Foreign-invested Enterprises ("Circular 19"), promulgated on March 30, 2015 and last amended on March 23, 2023, allows FIEs to make equity investments by using RMB funds converted from foreign exchange capital. Under Circular 19, the foreign exchange capital in the capital account of FIEs upon the confirmation of rights and interests of monetary contribution by the local foreign exchange bureau (or the book-entry registration of monetary contribution by the banks) can be settled at the banks based on the actual operation needs of the enterprises. The proportion of willingness-based foreign exchange settlement of capital for FIEs is temporarily set at 100%. The SAFE can adjust such proportion in due time based on the circumstances of the international balance of payments. However, Circular 19 and the Circular on Reforming and Regulating the Management Policies on the Settlement of Capital Projects continues to prohibit FIEs from, among other things, using RMB fund converted from its foreign exchange capitals for expenditure beyond its business scope, investment and financing in securities and other investments except for bank's principal-secured products, providing loans to non-affiliated enterprises or constructing or purchasing real estate not for self-use.

On October 23, 2019, the SAFE promulgated the Circular on Further Promoting the Facilitation of Cross- border Trade and Investment, which was replaced by the Circular on Further Deepening the Reform to Promote the Facilitation Cross-border Trade and Investment as of December 4, 2023 ("Circular 28"). Pursuant to Circular 28, on the basis of allowing investment-oriented foreign-invested enterprise (including foreign-invested investment companies, foreign-invested venture capital enterprises and foreign-invested equity investment enterprises) to use capital funds for domestic equity investment in accordance with laws and regulations, non-investment FIEs shall be allowed to use capital funds for domestic equity investment in accordance with the laws under the premise of not violating the Special Entry Management Measures (Negative List) for the Access of Foreign Investment (2024 version) and the authenticity and compliance of their domestic invested projects.

According to the Circular on Optimizing Administration of Foreign Exchange to Support the Development of Foreign-related Business issued by the SAFE on April 10, 2020, eligible enterprises are allowed to make domestic payments by using their capital funds, foreign credits and the income under capital accounts of overseas listing, with no need to provide the evidentiary materials concerning authenticity of such capital for banks in advance, provided that their capital use shall be authentic and in line with provisions, and conform to the prevailing administrative regulations on the use of income under capital accounts. The concerned bank shall conduct spot checking in accordance with the relevant requirements.

On December 25, 2006, the People's Bank of China issued the Administration Measures on Individual Foreign Exchange Control and its Implementation Rules were issued by the SAFE on January 5, 2007, both of which became effective on February 1, 2007. The Implementation Rules was later amended on May 29, 2016 and on March 23, 2023. Under these regulations, all foreign exchange matters involved in the employee stock ownership plan, stock option plan and other similar plans, participated by onshore individuals shall be transacted upon approval from the SAFE or its authorized branch. On February 15, 2012, the SAFE promulgated the Notice on Relevant Issues Concerning Foreign Exchange Control on Domestic Individuals Participating in the Stock Incentive Plan of An Overseas Listed Company, or Circular 7, to replace the Operating Procedures for Administration of Domestic Individuals Participating in the Employee Stock Option Plan or Stock Option Plan of An Overseas Listed Company. Under Circular 7, the board members, supervisors, officers or other employees, including PRC citizens and foreigners having lived within the territory of the PRC successively for at least one year of a PRC entity, who participate in stock incentive plans or stock option plans by an overseas publicly listed company, or the PRC participants, are required, through a PRC agent or PRC subsidiaries of such overseas publicly-listed company, to complete certain foreign exchange registration procedures with respect to the plans upon the examination by, and approval of, the SAFE. We and our PRC participants who have been granted stock options are subject to Circular 7. If our PRC participants who hold such options or our PRC subsidiary fail to comply with these regulations, such participants and their PRC employer may be subject to fines and legal sanctions.

*Regulations on Foreign Investment*

The National People's Congress enacted the Foreign Investment Law of the PRC on March 15, 2019 and the State Council promulgated the Implementation Regulations of Foreign Investment Law of the PRC on December 26, 2019, both of which came into force on January 1, 2020. On December 30, 2019, the MOFCOM and the SAMR jointly promulgated the Measures on Reporting of Foreign Investment Information, which also became effective on January 1, 2020. Under these laws and regulations, foreign investors or FIEs shall report and update investment information to the competent department for commerce through the Enterprise Registration System and the National Enterprise Credit Information Publicity System. Any foreign investor or FIE found to be non-compliant with these reporting obligations may potentially be subject to fines and legal sanctions.

The Foreign Investment Law of the PRC, together with its Implementation Regulations replaced, in their entirety, the trio of previous laws regulating foreign investment in China, namely, the Sino-foreign Equity Joint Venture Enterprise Law, the Sino-foreign Cooperative Joint Venture Enterprise Law and the Wholly Foreign- invested Enterprise Law, together with their implementation rules and ancillary regulations. Generally speaking, the Company Law of the PRC or the Partnership Law of the PRC (promulgated by the SCNPC in February 1997 and amended in August 2006) shall apply with respect to the organization of FIEs.

*Regulations on Offshore Financing*

On October 21, 2005, the SAFE issued Notice on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents' Corporate Financing and Roundtrip Investment through Offshore Special Purpose Vehicles, or SAFE Circular 75, which became effective as of November 1, 2005. Under SAFE Circular 75, if PRC residents use assets or equity interests in their PRC entities as capital contributions to establish offshore special-purpose companies directly or indirectly controlled by such PRC residents to carry out equity financing overseas and through special-purpose companies to carry out direct investment activities in China, they are required to register with local SAFE branches with respect to their overseas investments in offshore companies and roundtrip investment. PRC residents are also required to file amendments to their registrations if their offshore companies experience material events involving capital variation, such as changes in share capital, share transfers, mergers and acquisitions, spin-off transactions, long-term equity or debt investments or uses of assets in China to guarantee offshore obligations.

Moreover, SAFE Circular 75 applies retroactively. As a result, PRC residents who have established or acquired control of offshore companies that have made onshore investments in the PRC in the past were required to complete the relevant registration procedures with the local SAFE branch by March 31, 2006. Under the relevant rules, failure to comply with the registration procedures set forth in Circular 75 may result in restrictions being imposed on the foreign exchange activities of the relevant onshore company, including the increase of its registered capital, the payment of dividends and other distributions to its offshore parent or affiliate and the capital inflow from the offshore entity, and may also subject relevant PRC residents to penalties under PRC foreign exchange administration regulations. PRC residents who control our company are required to register periodically with the SAFE in connection with their investments in us.

The SAFE issued a series of guidelines to its local branches with respect to the operational process for SAFE registration, including the Notice of the State Administration of Foreign Exchange on Further Improving and Adjusting Foreign Exchange Administration Policies for Direct Investment, which came into effect as of December 17, 2012 and last amended on December 30, 2019. The guidelines standardized more specific and stringent supervision on the registration required by SAFE Circular 75. For example, the guidelines impose obligations on onshore subsidiaries of an offshore entity to make true and accurate statements to the local SAFE authorities in case any shareholder or beneficial owner of the offshore entity is a PRC citizen or resident. Untrue statements by the onshore subsidiaries will lead to potential liability for the subsidiaries, and in some instances, for their legal representatives and other individuals.

On July 4, 2014, the SAFE issued SAFE Circular 37, which became effective and suspended SAFE Circular 75 on the same date, and Circular 37 shall prevail over any other inconsistency between itself and relevant regulations promulgated previously. Pursuant to SAFE Circular 37, any PRC residents, including both PRC institutions and individual residents, are required to register with the local branch of the SAFE before making a contribution to an enterprise directly established or indirectly controlled by the PRC residents outside of the PRC for the purpose of overseas investment or financing with their legally owned domestic or offshore assets or equity interests, referred to in this circular as a "special purpose vehicle." Under SAFE Circular 37, the term "PRC institutions" refers to entities with legal person status or other economic organizations established within the territory of the PRC. The term "PRC individual residents" includes all PRC citizens (also including PRC citizens abroad) and foreigners who habitually reside in the PRC for economic benefit. A registered special purpose vehicle is required to amend its SAFE registration with respect to such vehicle in connection with any change of basic information including PRC individual resident shareholder, name, term of operation, or PRC individual resident's increase or decrease of capital, transfer or exchange of shares, merger, division or other material changes. In addition, if a non- listed special purpose vehicle grants any equity incentives to directors, supervisors or employees of domestic companies under its direct or indirect control, the relevant PRC individual residents could register with the local branch of the SAFE before exercising such options. The SAFE simultaneously issued guidance to its local branches with respect to the implementation of SAFE Circular 37. Under SAFE Circular 37, failure to comply with the foreign exchange registration procedures may result in restrictions being imposed on the foreign exchange activities of the relevant onshore company, including restrictions on the payment of dividends and other distributions to its offshore parent company and the capital inflow from the offshore entity, and may also subject the relevant PRC residents and onshore company to penalties under the PRC foreign exchange administration regulations.

On January 5, 2023, the NDRC issued the Administrative Measures for Examination and Registration of Medium and Long-term Foreign Debts of Enterprises, which came into effect on February 10, 2023 and replaced the Circular of the National Development and Reform Commission on Promoting the Administrative Reform of the Record-filing and Registration System for the Issuance of Foreign Debts by Enterprises. According to the Administrative Measures for Examination and Registration of Medium and Long-term Foreign Debts of Enterprises, enterprises shall, prior to the borrowing of foreign debts, obtain the certificate of examination and registration of foreign debts borrowed by enterprises and complete the formalities of examination and registration. Enterprises that have not completed examination and registration formalities are not allowed to borrow foreign debts.

*Regulations on Dividend Distribution*

The principal regulations governing distribution of dividends of FIEs include the Company Law of the PRC. Under the Company Law of the PRC, companies shall contribute 10% of the profits into their statutory surplus reserve upon distribution of their post-tax profits of the current year. A company may discontinue the contribution when the aggregate sum of the statutory surplus reserve is more than 50% of its registered capital.

*Regulations on Taxation*

According to the EIT Law, which was promulgated on March 16, 2007, and came into effect on January 1, 2008 and last amended by the SCNPC on December 29, 2018, and the Implementation Regulations on the EIT Law, which was promulgated by the State Council on December 6, 2007 and came into effect on January 1, 2008, and last amended by the State Council on December 6, 2024 and came into effect on the same date, a uniform income tax rate of 25% will be applied to domestic enterprises, FIEs. These enterprises are classified as either resident enterprises or nonresident enterprises. Besides enterprises established within the PRC, enterprises established in accordance with the laws of other judicial districts whose "de facto management bodies" are within the PRC are considered "resident enterprises" and subject to the uniform 25% enterprise income tax rate for their global income. A nonresident enterprise refers to an entity established under foreign law whose "de facto management bodies" are not within the PRC but which have an establishment or place of business in the PRC, or which do not have an establishment or place of business in the PRC but have income sourced within the PRC. An income tax rate of 10% will normally be applicable to dividends declared to or any other gains realized on the transfer of shares by non-PRC resident enterprise investors that do not have an establishment or place of business in the PRC, or that have such establishment or place of business but the relevant income is not effectively connected with the establishment or place of business, to the extent such dividends are derived from sources within the PRC.

According to the Arrangement for the Avoidance of Double Taxation and Tax Evasion between Mainland of China and Hong Kong entered into between Mainland China and the Hong Kong Special Administrative Region on August 21, 2006, if the non-PRC parent company of a PRC enterprise is a Hong Kong resident which directly owns 25% or more of the equity interest of the PRC foreign-invested enterprise which pays the dividends and interests, the 10% withholding tax rate applicable under the EIT Law may be lowered to 5% for dividends and 7% for interest payments if a Hong Kong resident enterprise is determined by the competent PRC tax authority to have satisfied the relevant conditions and requirements under such Double Tax Avoidance Arrangement and other applicable laws. However, according to the Notice on the Certain Issues with Respect to the Enforcement of Dividend Provisions in Tax Treaties, which was promulgated by the State Administration of Taxation or the SAT on February 20, 2009 and which came into effect on the same date, if the relevant PRC tax authorities determine, in their discretion, that a company benefits unjustifiably from such reduced income tax rate due to a structure or arrangement that is primarily tax-driven, such PRC tax authorities may adjust the preferential tax treatment; and based on the Announcement of the Certain Issues with Respect to the "Beneficial Owner" in Tax Treaties, issued by the SAT on February 3, 2018 and effective on April 1, 2018, if an applicant's business activities do not constitute substantive business activities, it could result in the negative determination of the applicant's status as a "beneficial owner," and consequently, the applicant could be precluded from enjoying the above-mentioned reduced income tax rate of 5% under the Double Tax Avoidance Arrangement.

The Provisional Regulations on Value-added Tax, which was promulgated on December 13, 1993, came into effect on January 1, 1994, and last amended on November 19, 2017, and the Detailed Implementing Rules of the Provisional Regulations on Value-added Tax, which was promulgated on December 25, 1993 and came into effective on the same date, and was amended on December 15, 2008 and October 28, 2011, came into effect on November 1, 2011 set out that all taxpayers selling goods or providing processing, repairing or replacement services, sales of services, intangible assets and immovable assets and importing goods in China shall pay a value- added tax.

On November 19, 2017, the State Council promulgated the Decisions on Abolishing the Provisional Regulations of the PRC on Business Tax and Amending the Provisional Regulations of the PRC on Value- added Tax, according to which, all enterprises and individuals engaged in the sale of goods, the provision of processing, repair and replacement services, sales of services, intangible assets, real property and the importation of goods within the territory of the PRC are the taxpayers of value-added tax. The value-added tax rates generally applicable are simplified as 17%, 11%, 6% and 0%, and the value-added tax rate applicable to the small-scale taxpayers is 3%. According to the Notice of the Ministry of Finance and the State Administration of Taxation on Adjusting Value- added Tax Rates issued on April 4, 2018 and became effective on May 1, 2018, the deduction rates of 17% and 11% applicable to the taxpayers who have value added tax, taxable sales activities, or imported goods are adjusted to 16% and 10%, respectively. According to the Announcement on Policies for Deepening the Value-added Tax Reform issued by the Ministry of Finance, the SAT and the General Administration of Customs on March 20, 2019 and became effective on April 1, 2019, the value added tax rate was reduced to 13% and 9%, respectively.

*Regulations on Employment and Social Insurance*

The PRC Labor Contract Law promulgated by the SCNPC in 2007 and amended in December 2012, and its implementation rules issued by the State Council in 2009, require employers to provide written contracts to their employees, restrict the use of temporary workers and aim to give employees long-term job security. Violations of the PRC Labor Law and the PRC Labor Contract Law may result in fines and other administrative sanctions, and serious violations may result in criminal liabilities.

The PRC governmental authorities have passed a variety of laws and regulations regarding social insurance and housing funds from time to time, including, among others, the PRC Social Insurance Law, the Regulation of Insurance for Labor Injury, the Regulations of Insurance for Unemployment and the Provisional Insurance Measures for Maternal Employees. Pursuant to these laws and regulations, PRC companies must make contributions at specified levels for their employees to the relevant local social insurance and housing fund authorities. Failure to comply with such laws and regulations may result in various fines and legal sanctions and supplemental contributions to the local social insurance and housing fund regulatory authorities.

*Regulations on Share Incentive Plans*

Pursuant to the Notices of Issues Concerning the Foreign Exchange Administration for Domestic Individuals Participating in Stock Incentive Plan of Overseas Publicly Listed Company, issued by the SAFE in February 2012, employees, directors, supervisors, and other senior management participating in any share incentive plan of an overseas publicly-listed company who are PRC citizens or non-PRC citizens residing in China for a continuous period of not less than one year, subject to a few exceptions, are required to register with the SAFE through a domestic qualified agent, which may be a PRC subsidiary of such overseas listed company, and complete certain other procedures

In addition, the SAT has issued certain circulars concerning employee share options and restricted shares. Under these circulars, employees working in China who exercise share options or are granted restricted shares will be subject to PRC individual income tax. The PRC subsidiaries of an overseas listed company are required to file documents related to employee share options and restricted shares with relevant tax authorities and to withhold individual income taxes of employees who exercise their share options or purchase restricted shares. If the employees fail to pay or the PRC subsidiaries fail to withhold income tax in accordance with relevant laws and regulations, the PRC subsidiaries may be subject to sanctions imposed by the tax authorities or other PRC governmental authorities.

*M&A Rules and Overseas Listing*

On August 8, 2006, six PRC regulatory authorities, including the MOFCOM and the CSRC, promulgated the M&A Rules governing the mergers and acquisitions of domestic enterprises by foreign investors, which became effective on September 8, 2006 and was amended on June 22, 2009. The M&A Rules, among other things, require that if an overseas company established or controlled by PRC companies or PRC citizens intends to acquire equity interests or assets of any other PRC domestic company affiliated with the PRC citizens, such acquisition must be submitted to the MOFCOM for approval. The M&A Rules also require that an offshore special purpose vehicle, or a special purpose vehicle formed for overseas listing purposes and controlled directly or indirectly by PRC companies or individuals, shall obtain the approval of the CSRC prior to overseas listing and trading of such special purpose vehicle's securities on an overseas stock exchange.

*Regulation on Information Protection on Networks* 

On June 1, 2017, the Cybersecurity Law of the PRC promulgated in November, 2016 by SCNPC became effective. This law also absorbed and restated the principles and requirements mentioned in the aforesaid decision and order, and further provides that, where an individual finds any network operator collects or uses his or her personal information in violation of the provisions of any law, regulation or the agreement of both parties, the individual shall be entitled to request the network operator to delete his or her personal information; if the individual finds that his or her personal information collected or stored by the network operator has any error, he or she shall be entitled to request the network operator to make corrections, and the network operator shall take measures to do so. Pursuant to this law, the violators may be subject to: (i) warning; (ii) confiscation of illegal gains and fines equal to one to ten times of the illegal gains; or if without illegal gains, fines up to RMB1,000,000; or (iii) an order to shut down the website, suspend the business operation for rectification, or revoke business license. Besides, responsible persons may be subject to fines between RMB10,000 and RMB100,000.

On June 10, 2021, the SCNPC promulgated the PRC Data Security Law, which came into effect in September 2021. The PRC Data Security Law imposes data security and privacy obligations on entities and individuals carrying out data activities, and introduces a data classification and hierarchical protection system based on the importance of data in economic and social development, as well as the degree of harm it will cause to national security, public interests, or legitimate rights and interests of individuals or organizations when such data is tampered with, destroyed, leaked, or illegally acquired or used. The PRC Data Security Law also provides for a national security review procedure for data activities that may affect national security and imposes export restrictions on certain data and information.

In August 2021, the SCNPC officially promulgated the Personal Information Protection Law, which came into effect from November 1, 2021. The Personal Information Protection Law provides detailed rules on handling personal information and legal responsibilities, including but not limited to the scope of personal information and the ways of processing personal information, the establishment of rules for processing personal information, and the individual's rights and the processor's obligations in the processing of personal information. The Personal Information Protection Law also strengthens the punishment for those who illegally process personal information.

On December 28, 2021, the CAC, together with 12 other regulatory authorities jointly promulgated the amended Cybersecurity Review Measures, which came into effect on February 15, 2022 and supersede and replace the Cybersecurity Review Measures previously promulgated on April 13, 2020. The amended Cybersecurity Review Measures provide that the purchase of network products and services by a CIIO and the data processing activities of a "internet platform operator" that affect or may affect national security shall be subject to the cybersecurity review.

Where the purchase of network products and services by a CIIO affects or may affect national security, the CIIO shall notify the Cybersecurity Review Office, which is under the CAC, and a cybersecurity review shall be conducted pursuant to the amended Cybersecurity Review Measures. Furthermore, if a "internet platform operator" that possesses personal information of more than one million users and seeks a listing in a foreign country must apply for a cybersecurity review with the Cybersecurity Review Office. According to the amended Cybersecurity Review Measures, the term "network products and services" mainly refers to core network equipment, high performance computers and servers, large-capacity storage devices, large-capacity databases and application software, network security equipment, cloud computing services, and other network products and services that have a significant impact on critical information infrastructure security, cybersecurity and data security. Under the Cybersecurity Law of the PRC, where CIIOs use network products or services that have neither been reviewed for security, nor passed the cybersecurity review, they shall be ordered by the relevant competent departments to stop using such products or services, and a fine of no less than one, but no more than ten times the purchase amount shall be imposed. As for the persons in charge directly or otherwise are directly responsible, a fine of no less than RMB 10,000 but no more than RMB100,000 shall be imposed. As of the date of this annual report, we have not received any notice from the CAC which identifies us as a CIIO under the amended Cybersecurity Review Measures.

**Organizational structure**

The following diagram illustrates our corporate structure as of October 31, 2025:

![](ea027833401_img48.jpg)

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| | | |
|:---|:---|:---|
| **Name** | **Background** | **Ownership** |
| Park Ha Biological Technology (HK) Co., Ltd. | Incorporated on October 25, 2022 as a limited liability company in Hong Kong | 100% owned by Park Ha Cayman |
| Park Ha Investment (Wuxi) Co., Ltd. | Incorporated on May 5, 2023 as a limited liability company in the PRC | 100% owned by Park Ha HK |
| Jiangsu Park Ha Biological Technology Co., Ltd. | Incorporated on August 13, 2019 as a limited liability company in the PRC | 100% owned by Park Ha Investment |
| Wuxi Xinzhan Enterprise ManagementConsulting Co., Ltd. | Incorporated on March 31, 2016 as a limited liability company in the PRC | 100% owned by Park Ha Investment |
| Shanghai Park Ha IndustrialDevelopment Co., Ltd. | Incorporated on April 17, 2017 as a limited liability company in the PRC | 100% owned by Xinzhan |
| Wuxi Muchen Biotechnology Co., Ltd | Incorporated on February 21, 2025 as a limited liability company in the PRC | 100% owned by Park Ha Jiangsu |
| Wuxi Mufeng Biotechnology Co., Ltd. | Incorporated on February 21, 2025 as a limited liability company in the PRC | 100% owned by Park Ha Jiangsu |
| Xinyuexuan Beauty Salon, Wuxi Economic Development Zone | Incorporated on July 28, 2025 | 100% agreement control by Park Ha Jiangsu |
| Aimeihui Beauty Center, Wuxi Economic Development Zone | Incorporated on August 11, 2025 | 100% agreement control by Park Ha Jiangsu |
| Huishan District Xuanyayue Beauty Salon | Incorporated on January 22, 2025 | 100% agreement control by Park Ha Jiangsu (close down on Oct. 10 2025） |

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**D. Property, plants and equipment**

Our principal executive offices are located in Wuxi, Jiangsu Province, China. Information on our leased properties as of October 31, 2025 is summarized below:

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| | | | |
|:---|:---|:---|:---|
| **Location** | **Size<br> (Square Meters)** | **Term** | **Primary Use** |
| 901, Building C, Phase 2, Wuxi International Life ScienceInnovation Campus, 196 Jinghui East Road Xinwu District, Wuxi, Jiangsu Province, China | 400.00 | July 1, 2025 –December 31, 2028 | Office |
| Building 3, No. 380 Jincheng East Road, Xinwu District, Wuxi | 180.00 | September 18, 2024 – September 30, 2026 | Warehouse |
| Unit 3404, Building 52, Haiyue Garden, No. 196 GuanshanRoad, Binhu District, Wuxi | 109.93 | March 13, 2024 – March 12, 2026 | Employee Dormitory |
| Shop No. 3050B, Xinwu Wanda Plaza, Wuxi, Jiangsu Province, China | 66.30 | September 30, 2025 – September 29, 2026 | Operation |
| No. 3 Qianwei Road, Xinwu District, Wuxi | 53.64 | March 1, 2025 – September 30, 2027 | Operation |
| Shop No. 433, Coastal City 30.39-401, Wuxi Economic Development Zone, Jiangsu Province, China | 78.80 | September 1, 2025 – December 29, 2027 | Operation |
| B161A, No. 88 Jinshi Road, Binhu District, Wuxi City, Jiangsu Province, China | 49.00 | May 20 2025 – May 19 2027 | Operation |
| No. 94, Jinghua Garden, Taihu Avenue, Binhu District, Wuxi | 250 | October 1 2025 – September 30 2027 | Employee Dormitory |
| 59-103, Bafanghui, Coastal City, Wuxi | 58.83 | October 8 2025 – October 7 2027 | Operation |

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**ITEM 4A. UNRESOLVED STAFF COMMENTS**

None.

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

*The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes that appear in this annual report. In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this annual report, particularly in "Risk Factors." All amounts included herein with respect to the fiscal years ended October 31, 2025, 2024 and 2023 are derived from our audited consolidated financial statements included elsewhere in this annual report. Our financial statements have been prepared in accordance with U.S. Generally Accepted Accounting Principles, or U.S. GAAP.*

**A. Operating Results**

***Key Factors Affecting Our Results of Operations***

Our Operating Subsidiaries currently derive a majority of their revenues from the sale of products and receipt of franchise fees. Park Ha intends to continually enhance its services and cross-sell new services to existing customers and acquire new customers by increasing market penetration with a deeper market coverage and broader geographical reach. Maintaining and enhancing the recognition, image and acceptance of our brand are important to Park Ha's ability to differentiate our products from and to compete effectively with our peers. Our brand image, however, could be jeopardized if we fail to maintain high product quality, pioneer and keep pace with evolving technology trends, or timely fulfill the orders for our products. If we fail to promote our brand or to maintain or enhance our brand recognition and awareness among our customers, or if we are subject to events or negative allegations affecting our brand image or the publicly perceived position of our brand, our business, results of operations and financial condition could be adversely affected.

Our business is in the beauty industry, which is now experiencing rapid technological and model changes. Failure to anticipate technology innovations or adapt to such innovations in a timely manner, or at all, may result in our products and services becoming obsolete or suffering unpredictable intervals.

We monitor a number of financial and non-financial key business metrics to evaluate on a regular basis business, growth trends and company budgets, measure the effectiveness of our sales and marketing efforts, and assess operational efficiencies. We believe that some of the most important measures include gross profit margin, operating margin, net income (loss) as well as the non-financial key metrics discussed below which may differ from other similarly titled metrics used by other companies, securities analysts or investors.

*Number of contracts for our franchisees*

We monitor the number of contracts with customers for our franchisees. The number of contracts will directly impact our results of operations, including revenues and gross profit margins for the foreseeable future. As of October 31, 2025, 2024 and 2023, we had 22, 45 and 38 franchisees in China, of which 22, 43 and 36 franchisees operate under the store name "Park Ha". As of October 31, 2025, 2024 and 2023, we had 0, 2 and 2 franchisees operate under a different brand name. The business relationships between us and our independent franchisees are built on our standards and policies that is of fundamental importance to the overall performance and protection of the "Park Ha" brand.

*Expansion of our geographic coverage*

We believe there is a substantial opportunity to further grow our customer base by continuing to make significant investments in sales, marketing and brand building. Our ability to attract new customers will depend on a number of factors, including competitive dynamics in our targeted new geographical markets in China. We intend to expand our marketing and sales team with a focus on increasing sales in targeted geographies and customer segments. This will play a pivotal role in driving the company's growth in terms of sales revenue and franchise fee revenue.

**RESULTS OF OPERATIONS**

**<u>For the years ended October 31, 2025, 2024 and 2023</u>**

The following table presents a summary of the Company's comprehensive operating performance for the fiscal years ended October 31, 2025, 2024 and 2023. The historical performance listed below does not necessarily indicate expected performance for any future period.

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended<br> October 31,** | **For the years ended<br> October 31,** | **For the years ended<br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Revenues, net | 2524843 | 2381851 | 2459102 |
| Cost of revenues | 142526 | 195336 | 310989 |
| Gross profit | 2382317 | 2186515 | 2148113 |
| Selling and marketing expenses | 625289 | 361327 | 299615 |
| General and administrative expenses | 25483541 | 814857 | 484955 |
| Research and development expenses | 238184 | 36714 | 30881 |
| Allowance for expected credit losses | 184204 | 179903 | 152108 |
| Operating (loss) income | (24148901) | 793714 | 1180554 |
| Interest income | 6097 | 783 | 1590 |
| Interest expense | (41) |  |  |
| Other income (expenses) | 58738 | (1076) | (575) |
| Total other income (expenses) | 64794 | (293) | 1015 |
| (Loss) income before tax | (24084107) | 793421 | 1181569 |
| Income tax expense (benefits) | 280646 | 314860 | 329527 |
| Net (loss) income | (24364753) | 478561 | 852042 |

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 **

***Revenue***

 **

The sales revenue consists of the following:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** |
|  | **October 31,** | **October 31,** | **October 31,** | **October 31,** | **October 31,** | **October 31,** |
|  | **2025** | **2025** | **2024** | **2024** | **2023** | **2023** |
| Products sales – Non-franchisees | 535760 | 21% | 355832 | 15% | 302505 | 12% |
| Product sales – Franchisees | 478274 | 19% | 351399 | 15% | 346240 | 14% |
| Franchise fees | 1510809 | 60% | 1674620 | 70% | 1810357 | 74% |
| Amount | 2524843 | **100%** | 2381851 | **100%** | 2459102 | **100%** |

---

Direct costs consist of the following:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** |
|  | **October 31, <br> 2025** | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, <br> 2024** | **October 31, <br> 2023** | **October 31, <br> 2023** |
| Products sales – Non-franchisees | 21982 | 15% | 21390 | 11% | 45770 | 15% |
| Product sales – Franchisees | 107344 | 75% | 67593 | 35% | 96015 | 31% |
| Franchise fees | 13200 | 10% | 106353 | 54% | 169204 | 54% |
| Amount | 142526 | **100%** | 195336 | **100%** | 310989 | **100%** |

---

The gross profit consists of the following:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** | **For the years ended** |
|  | **October 31, <br> 2025** | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, <br> 2024** | **October 31, <br> 2023** | **October 31, <br> 2023** |
| Productssales – Non-franchisees | 513778 | 22% | 334422 | 15% | 256735 | 12% |
| Product sales – Franchisees | 370930 | 16% | 283806 | 13% | 250225 | 12% |
| Franchise fees | 1497609 | 62% | 1568267 | 72% | 1641153 | 76% |
| Amount | 2382317 | **100%** | 2186515 | **100%** | 2148113 | **100%** |

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The gross profit margin consists of the following:

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended** | **For the years ended** | **For the years ended** |
|  | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, <br> 2023** |
| Products sales – Non-franchisees | 96% | 94% | 85% |
| Product sales – Franchisees | 78% | 81% | 72% |
| Franchise fees | 99% | 94% | 91% |
| Amount | 94% | 92% | 87% |

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For the fiscal year ended October 31, 2025, our total revenue was $2,524,843, while for the fiscal year ended October 31, 2024, our total revenue was $2,381,851, representing a increase of $142,992, or 6%, which was primarily attributable to the growth in sales revenue.

Our products sales revenue increased by $306,803, or 43%, from $707,231 for the year ended October 31, 2024 to $1,014,034 for the year ended October 31, 2025, which is mainly because with the improvement of the company's brand awareness, the sales business is in the trend of increasing year by year.

Our Franchise fees revenue decreased by $163,811, or 10%, from $1,674,620 for the year ended October 31, 2024 to $1,510,809 for the year ended October 31, 2025, which is mainly because the decrease of franchisees.

For the fiscal year ended October 31, 2024, our total revenue was $2,381,851, while for the fiscal year ended October 31, 2023, our total revenue was $2,459,102, representing a decrease of $77,251, or 3%, which was primarily attributable to the decrease in franchise fees.

Our products sales revenue increased by $58,486, or 9%, from $648,745 for the year ended October 31, 2023 to $707,231 for the year ended October 31, 2024, which is mainly because with the improvement of the company's brand awareness, the sales business is in the trend of increasing year by year.

Our Franchise fees revenue decreased by $135,737, or 7%, from $1,810,357 for the year ended October 31, 2023 to $1,674,620 for the year ended October 31, 2024.The primary reason is that two Class A franchisees changed to Class C franchisees on May 2, 2023, and June 10, 2023, respectively, resulting in a decrease in revenue of $226,749 in fiscal year 2024 compared to fiscal year 2023. In fiscal year 2023, three Class A franchisees changed to Class C franchisees on April 29, 2023, May 21, 2023 and May 23, 2023, respectively, resulting in a decrease in revenue of $85,607 in fiscal year 2024 compared to the same period. Revenue recognized by terminated franchisees in FY2023 was $160,660; Revenue from newly signed franchisees increased by $403,200 in FY2024.

Products sales — Non-franchisees

Product sales revenue from non-franchisees increased by $179,928, or 51%, from $355,832 for the fiscal year ended October 31, 2024 to $535,760 for the fiscal year ended October 31, 2025. Sales revenue from non-franchisees accounted for 21% and 15% of the total revenue, respectively for the fiscal years ended October 31, 2025 and 2024. The above increase of revenue was mainly due to the increase of two new directly-operated stores.

Product sales revenue from non-franchisees increased by $53,327, or 18%, from $302,505 for the fiscal year ended October 31, 2023 to $355,832 for the fiscal year ended October 31, 2024. Sales revenue from non-franchisees accounted for 15% and 12% of the total revenue, respectively, for the fiscal years ended October 31, 2024 and 2023. Product sales revenue from non-franchisees for the fiscal years ended October 31, 2024 and 2023 remained a relatively stable growth trend.

The cost of products sales to non-franchise for the fiscal year ended October 31, 2025 was $21,982, which represents a increased of $592 or 3% compared to $21,390 for the fiscal year ended October 31, 2024. For the fiscal years ended October 31, 2025 and 2024, cost of products sales to non-franchisees accounted for 15% and 11% of the total cost of revenue, respectively. The cost of products sales to non-franchise for the fiscal year ended October 31, 2025 and 2024 remained relatively stable.

The cost of products sales to non-franchise for the fiscal year ended October 31, 2024 was $21,390, which represents a decreased of $24,380 or 53% compared to $45,770 for the fiscal year ended October 31, 2023. For the fiscal years ended October 31, 2024 and 2023, cost of products sales to non-franchisees accounted for 11% and 15% of the total cost of revenue, respectively. The above decrease in cost of revenue was mainly due to: (i) the sales of some old products have decreased; (ii) some old products have been optimized in the company's product composition structure, removing unnecessary packaging. These factors resulted in a decrease in cost of revenue compared to the previous period.

For the fiscal years ended October 31, 2025 and 2024, gross profit of products sales to non-franchisees accounted for 22% and 15% of the total gross profit, respectively. The gross profit and gross profit margin for the fiscal year ended October 31, 2025 were $513,778 and 96%, respectively. The gross profit and gross profit margin for the fiscal year ended October 31, 2024 were $334,422 and 94%, respectively. The gross profit margin of products sales to non-franchisees for the fiscal years ended October 31, 2025 and 2024 remained relatively stable.

For the fiscal years ended October 31, 2024 and 2023, gross profit of products sales to non-franchisees accounted for 15% and 12% of the total gross profit, respectively. The gross profit and gross profit margin for the fiscal year ended October 31, 2024 were $334,442 and 94%, respectively. The gross profit and gross profit margin for the fiscal year ended October 31, 2023 were $256,735 and 85%, respectively. The increase of gross profit margin of products sales to non-franchisees for the fiscal years ended October 31, 2024 is the result of the decrease of cost of products sales to non-franchise as the company optimized the composition of the products and saved related costs.

Product sales — Franchisees

Product sales revenue from franchisees increased by $126,875, or 36%, from $351,399 for the fiscal year ended October 31, 2024 to $478,274 for the fiscal year ended October 31, 2025. Sales revenue from franchisees accounted for 19% and 15% of the total revenue, respectively, for the fiscal years ended October 31, 2025 and 2024. The above increase revenue was mainly due to the company's effective maintenance of customer relationships with franchisees, as well as regular supervision of their inventory replenishment and implementation of marketing activities.

Product sales revenue from franchisees increased by $5,159, or 1%, from $346,240 for the fiscal year ended October 31, 2023 to $351,399 for the fiscal year ended October 31, 2024. Sales revenue from franchisees accounted for 15% and 14% of the total revenue, respectively, for the fiscal years ended October 31, 2024 and 2023. Product sales revenue from franchisees for the fiscal years ended October 31, 2024 and 2023 remained relatively stable.

The cost of products sales to franchisees for the fiscal year ended October 31, 2025 was $107,344, representing an increase of $39,751, or 59%, compared to $67,593 for the fiscal year ended October 31, 2024. For the fiscal years ended October 31, 2025 and 2024, the cost of products sales to franchisees accounted for 77% and 35% of the total cost of revenue, respectively. The above increase is the result of an increase in product sales revenue from franchisees.

The cost of products sales to franchisees for the fiscal year ended October 31, 2024 was $67,593, representing a decrease of $28,422, or 30%, compared to $96,015 for the fiscal year ended October 31, 2023. For the fiscal years ended October 31, 2024 and 2023, the cost of products sales to franchisees accounted for 35% and 31% of the total cost of revenue, respectively. The above decrease in cost of revenue was mainly due to: (i) the sales of some old products have decreased; (ii) some old products have been optimized in the company's product composition structure, removing unnecessary packaging. These factors resulted in a decrease in cost of revenue compared to the previous period.

For the fiscal years ended October 31, 2025 and 2024, gross profit of products sales to franchisees accounted for 16% and 13% of the total gross profit, respectively. For the fiscal year ended October 31, 2025, gross profit and gross profit margin were $370,930 and 78%, respectively, while for the fiscal year ended October 31, 2024, gross profit and gross profit margin were $283,806 and 81%, respectively. The gross profit margin of products sales to franchisees decreased by 3% in FY2025 compared to FY2024, the main reason is that the increase of procurement cost.

For the fiscal years ended October 31, 2024 and 2023, gross profit of products sales to franchisees accounted for 13% and 12% of the total gross profit, respectively. For the fiscal year ended October 31, 2024, gross profit and gross profit margin were $283,806 and 81%, respectively, while for the fiscal year ended October 31, 2023, gross profit and gross profit margin were $250,225 and 72%, respectively. The gross profit margin of products sales to franchisees increased by 9% in FY2024 compared to FY2023, the main reason is that the company optimized the composition of the products and saved related costs, which increased the gross profit margin of the new products by 84% compared with the gross profit margin of the old products by 72% in the previous period, thus improving the overall gross profit margin.

Franchise fees

For the fiscal year ended October 31, 2025, the total revenue from franchise fees was $1,510,809, with a cost of franchise fees of $13,200, compared to $1,674,620 and $106,353 for the fiscal year ended October 31, 2024. Gross profit of franchise fees decreased by $70,658 for the same years. For the fiscal years ended October 31, 2025 and 2024, the total revenue from franchise fees accounted for 60% and 70% of the total revenue, respectively. For the fiscal year ended October 31, 2025 and 2024, the cost of franchise fees accounted for 10% and 54% of the total cost of revenue, respectively. For the fiscal years ended October 31, 2025 and 2024, the gross profit of franchise fees accounted for 62% and 72% of the total gross profit. The main reason is that:

Roll-forward of franchisees

The following table provides a roll-forward of our franchise contracts during the years ended October 31, 2025 , 2024 and 2023:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Number of <br> Franchise <br> Contracts<br> at the <br> Beginning of <br> Period** | **Number of <br> Newly Joined <br> Franchisees** | **Number of <br> Terminated <br> Franchisees** | **Number of <br> Franchise <br> Contracts<br> at the <br> End of<br> Period** |
| For the fiscal year ended October 31, 2023 | 49 | 6 | 17 | 38 |
| For the fiscal year ended October 31, 2024 | 38 | 8 | 1 | 45 |
| For the fiscal year ended October 31, 2025 | 45 | 5 | 28 | 22 |

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As of October 31, 2025, we had 22 franchisees ("2025 Franchisees"). As of October 31, 2025, we had 22 franchisees as a result of (i) 17 franchisees renewed their contracts and 28 expired ("Renewed Franchisees"); (ii) 5 newly contracted franchisees.

The revenue for the fiscal year ended October 31, 2025 comprised the revenue from (i) Renewed Franchisees of US$601,012, Terminated franchisees of 736,734 (ii) newly contracted franchisees of US$173,063.

As of October 31, 2024, we had 45 franchisees ("2024 Franchisees"). As of October 31, 2024, we had 45 franchisees as a result of (i) 37 franchisees renewed their contracts and 1 expired. ("Renewed Franchisees"); (ii) 8 newly contracted franchisees.

The revenue for the fiscal year ended October 31, 2024 comprised the revenue from (i) Renewed Franchisees of US$1,271,420, and (ii) newly contracted franchisees of US$403,200.

As of October 31, 2023, we had 38 franchisees as a result of (i) renewal of the contracts with 32 franchisees ("Renewed Franchisees") upon their expiry; (ii) termination of the contracts with 17 franchisees upon their expiry; and (iv) 6 newly contracted franchisees.

The revenue for the fiscal year ended October 31, 2023 comprised the revenue from (i) 2022 Franchisees of US$1,200,789.82, (ii) Renewed Franchisees of US$419,134.72, and (iii) newly contracted franchisees of US$190,296.

Our franchise fees are recognized over the franchise term as the performance obligation is satisfied, typically spanning one year. For details, see "Note 2 — Summary of Significant Accounting Policies — *Revenue Recognition*." The revenue for the fiscal year ended October 31, 2025 decreased by appropriately 10% as compared to the fiscal year ended October 31, 2024.The primary reason is that the decline in the number of franchisees has led to a decrease in franchise fee revenue.

Cost of franchise fees mainly includes the training service cost provided for franchisees. Due to the need for the Company to have a comprehensive understanding of the franchisees and relevant course planning in the early stages of training, investing more resources, leading to the cost of franchising is relatively high. The investment for the future years will be smaller, so the training costs related to franchise fees for this period will be reduced. This leads to a reduction in franchise costs. The gross profit was mainly due to the combined effect of the above-mentioned changes in revenue and cost of franchise fees.

***Selling and marketing expenses***

For the fiscal year ended October 31, 2025, our selling and marketing expenses were $625,289, while for the fiscal year ended October 31, 2024, our selling and marketing expenses were $361,327, representing an increase of $263,962, or 73%. The main reason for the increase is (i)the increase of $100,120 in payroll and welfare expenses based on the increased directly-operated store and increased sales staff and increased annual bonuses; (ii)the increase in Store Rental expenses and Renovation costs of $127,781 from $31,192 in FY2024 to $158,973in FY2025 because the increased directly-operated store ; and (iii) the increase in promotion expenses of $27,662 from $10,829 for FY2024 to $38,491 for FY2025 as a result of continuously optimization of marketing approaches.

For the fiscal year ended October 31, 2024, our selling and marketing expenses were $361,327, while for the fiscal year ended October 31, 2023, our selling and marketing expenses were $299,615, representing a increase of $61,712, or 21%. The main reason for the increase is (i)the increase of $73,886 in payroll and welfare expenses based on the increased directly-operated store and increased sales staff and increased annual bonuses; (ii)the decrease in store rental expenses and renovation costs of $18,240 from $49,432in FY2023 to $31,192 in FY2024 because lower lease fees due to lower rents for re-contracted contracts; and (iii) the increase in promotion expenses of $6,269 from $4,560 for FY2023 to $10,829 for FY2024 as a result of continuously optimization of marketing approaches.

***General and administrative expenses***

For the fiscal year ended October 31, 2025, our general and administrative expenses were $25,483,541, while for the fiscal year ended October 31, 2024, our general and administrative expenses were $814,857, representing a increase of $24,668,684 or 3,027%. The increase was primarily attributable to the following reasons: (i) the increase in Share-based Payment Expense of $24,070,200 from $nil for FY2024 to $24,070,200 for FY2025 as the payment of the Share-based payment expenses; (ii) the increase in professional expenses of $424,404 from $411,750 for FY2024 to $836,154 for FY2025 as the payment for Investor Relations Website Press Release, financial services of ONE SUPREME HOLDINGS LIMITED and NASDAQ; and (iii)the increase in Payroll and welfare expenses of $136,758 as the distribution of listing bonuses.

For the fiscal year ended October 31, 2024, our general and administrative expenses were $814,857, while for the fiscal year ended October 31, 2023, our general and administrative expenses were $484,955, representing a increase of $329,902 or 68%. The increase was primarily attributable to the following reasons: (i) the increase in professional expenses of $278,698 from $133,052 for FY2023 to $411,750 for FY2024 as the Payment of the completed audit service and miscellaneous IPO services in 2024; and (ii) the increase in annual meeting training expenses of $48,709 from nil for FY2023 to $48,709 for FY2024.

***Research and development expenses***

For the fiscal year ended October 31, 2025, our R&D expenses were $238,184, while for the fiscal year ended October 31, 2024, our R&D expenses were $36,714, representing an increase of $201,470 or 549%. The increase was primarily attributable to the following reasons: (i) the increase in research and development expenses of Cell Therapies of $194,032 from $nil for FY2024 to $194,032 for FY2025; (ii) the increase in raw materials of $4,851 from $nil for FY2024 to $4,851 for FY2025.; and (iii) the increase in patent expenses of $3,929 from 395 for FY2024 to $4,324 for FY2025.

For the fiscal year ended October 31, 2024, our R&D expenses were $36,714, while for the fiscal year ended October 31, 2023, our R&D expenses were $30,881, representing an increase of $5,833 or 19%. R&D expenses for the fiscal years ended October 31, 2024 and 2023 remained relatively stable.

***Allowance for expected credit losses***

 ****

Allowance for expected credit losses derives from allowances on accounts receivable and loan receivable from franchisees, based on past collection experience, current economic conditions, future economic conditions and changes in the Company's customer collection trends. Allowance for expected credit losses of accounts receivables and franchisee loan and other receivables were $184,204 for the fiscal year ended October 31, 2025 representing an increase of $4,301 or 2% from $179,903 for the fiscal year ended October 31, 2024.

Allowance for accounts receivables decreased by $86,992 from $231,851 as of October 31, 2024 to $144,859 as of October 31, 2025, primarily due to the decreased balance of accounts receivables from $562,743 as of October 31, 2024 to $400,703 as of October 31, 2025.

Allowance for franchisee loan increased by $177,356 from $55,520 as of October 31, 2024 to $232,876 as of October 31, 2025, primarily due to the increase of past-due loans.

Allowance for other receivables decreased by $40,011 from $51,013 as of October 31, 2024 to $11,002 as of October 31, 2025, primarily due to the deregistration of a franchisee, a provision of USD 38,613 for bad debts was written off.

Allowance for expected credit losses derives from allowances on accounts receivable and loan receivable from franchisees, based on past collection experience, current economic conditions, future economic conditions and changes in the Company's customer collection trends. Allowance for expected credit losses of accounts receivables and franchisee loan and other receivables were $179,903 for the fiscal year ended October 31, 2024, representing an increase of $27,795 or 18% from $152,108 for the fiscal year ended October 31, 2023.

Allowance for accounts receivables increased by $141,347 from $90,504 as of October 31, 2023 to $231,851as of October 31, 2024, primarily due to (i) the increased balance of accounts receivables from $452,239 as of October 31, 2023 to $562,743 as of October 31, 2024 in connection with our business expansion; and (ii) the change in the aging structure of accounts receivables, specifically, the accounts receivables that are aging over one year of $68,778 as of October 31, 2023, as compared to the accounts receivables that are aging over one year of $185,942 as of October 31, 2024.

Allowance for franchisee loan decreased by $7,082 from $62,602 as of October 31, 2023 to $55,520 as of October 31, 2024, primarily due to the proportion of bad debt losses measured by the migration rate fell from a year earlier.

Allowance for other receivables increased by $51,013 from $nil as of October 31, 2023 to $51,013 as of October 31, 2024, primarily due to the delayed payment of $49,331 due from two franchisees due to their financial difficulties, of which are not collected as of the date of this annual report. No allowance for loan receivable from franchisees was made as of October 31, 2023 since the management considered that the aging of loans receivables from franchisees were within three months, which was relatively short and there were no default indicators.

***Interest income (expense)***

Interest income and bank income mainly come from the bank transfer fees and deposit interest. Net of Interest income for the fiscal years ended October 31, 2025 and 2024 was approximately $6,056 and $783, respectively.

Interest income and bank income mainly come from the bank transfer fees and deposit interest. Net of Interest income for the fiscal years ended October 31, 2024 and 2023 was approximately $783 and $1,590, respectively.

***Income tax expense (benefit)***

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The Company in general is subject to profits tax rate at 25% for income generated for its operation in China and net operating losses can be carried forward for no longer than five years starting from the year subsequent to the year in which the loss was incurred.

In accordance with the implementation rules of EIT Laws, a qualified "High and New Technology Enterprise" ("HNTE") is eligible for a preferential tax rate of 15%. The HNTE certificate is effective for a period of three years. An entity could re-apply for the HNTE certificate when the prior certificate expires. "Park Ha Jiangsu" obtained its HNTE certificate on November 6, 2024. Therefore, "Park Ha Jiangsu" is eligible to enjoy a preferential tax rate of 15% from 2024 to 2026 to the extent it has taxable income under the EIT Law.

Announcement No. 12 [2023] of the Ministry of Finance and the State Taxation Administration stipulates that the preferential corporate income tax (CIT) policy for small and low-profit enterprises (SLPEs) — reducing taxable income by 25% and applying a 20% tax rate — shall be extended until December 31, 2027.Wuxi Muchen and Wuxi Mufeng and ParkHa Investment, with annual taxable income not exceeding RMB 1 million for the year ended October 31, 2025, qualify as SLPEs. As such, 25% of their taxable income is subject to CIT at the reduced rate of 20%.

Ai Meihui obtained the "Review Approval Notification for Application and Adjustment of Fixed Amount for Periodic Fixed-Amount Taxpayers" issued by the State Taxation Administration, Jiangsu Wuxi Economic Development Zone Tax Bureau on August 30, 2025, indicating that the application for "Periodic Fixed-Amount Taxpayer Application and Adjustment of Fixed Amount" submitted by Ai Meihui on August 22, 2025, has been approved. Upon review, Ai Meihui's account shall implement a monthly taxable amount of 0 yuan from August 1, 2025, to December 31, 2025.

Xinyuexuan obtained the "Review Approval Notification for Application and Adjustment of Fixed Amount for Periodic Fixed-Amount Taxpayers" issued by the State Taxation Administration, Jiangsu Wuxi Economic Development Zone Tax Bureau on August 19, 2025, indicating that the application for "Periodic Fixed-Amount Taxpayer Application and Adjustment of Fixed Amount" submitted by Xinyuexuan on August 11, 2025, has been approved. Upon review, Xinyuexuan's account shall implement a monthly taxable amount of 0 yuan from July 1, 2025, to December 31, 2025.

The income tax expense for the fiscal years ended October 31, 2025 and 2024 were approximately $280,646and $314,860, respectively.

The income tax expense for the fiscal year ended October 31, 2025 was adjusted by (i)the increase in the income tax expense by $6,209,492, of which $34,827 because Park Ha Jiangsu enjoyed a preferential rate of 15%, of which $6,202,101 because Park Ha Cayman is not subject to tax, of which $(4,404) because Wuxi Muchen,Wuxi Mufeng and ParkHa Investment enjoyed a preferential rate of 5% for small and Low-Profit Enterprises, of which $(23,032)because Aimei Hui and Xinyuexuan enjoyed Deemed Provision Tax Assessment; (ii)the decrease in the income tax expense of $45,429 due to the effect of super deduction of R&D expenses of $199,378; and (iii)the increase in the income tax expense by 134,531 because Park Ha Jiangsu and Park Ha Shanghai recorded net loss for the fiscal year ended October 31, 2025;and (iv)the increase in the income tax expense of $3,078 due to the effect of entertainment expenses of $19,956.

The income tax expense for the fiscal year ended October 31, 2024 was adjusted by (i)the increase in the income tax expense by $112,241, of which $14,259 because Park Ha Jiangsu enjoyed a preferential rate of 15%, of which $93,472 because Park Ha Cayman is not subject to tax, of which $4,510 because Park Ha Jiangsu enjoyed a preferential rate of 15% in 2024 and 20% in 2023; (ii)the decrease in the income tax expense of $5,507due to the effect of super deduction of R&D expenses of $36,714; and (iii)the increase in the income tax expense by 7,260, of which $(3,827) as a result of offsetting previous years' tax losses of $25,512 of Park Ha Jiangsu, of which $11,087 because Park Ha Shanghai recorded net loss for the fiscal year ended October 31, 2024;and (iv) the increase in the income tax expense of $2,510 due to the effect of non-deductible expenses of $15,962

The income tax expense for the fiscal year ended October 31, 2023 was adjusted by (i) the decrease in the income tax expense of $13,767 as a result of offsetting previous years' tax losses of $50,630; (ii) the decrease in the income tax expense of $4,632 due to the effect of super deduction of R&D expenses of $23,160; (iii) the increase in the income tax expense of $48,158 due to the effect of non-deductible expenses of $193,168; and (iv) the increase in the income tax expense of $4,375 because Park Ha Jiangsu enjoyed a preferential rate of 20% and Park Ha Shanghai recorded net loss for the fiscal year ended October 31, 2023.

**Net Loss/income**

As a result of the foregoing, for the fiscal year ended October 31, 2025, our loss was $24,364,753, compared to n**et income** $478,561 for the fiscal year ended October 31, 2024, representing an decrease of $24,843,314 or 5,191%.

As a result of the foregoing, for the fiscal year ended October 31, 2024, our net income was $478,561, compared to $852,042 for the fiscal year ended October 31, 2023, representing a decrease of $373,481 or 44%.

**Working capital and capital resources**

As of October 31, 2025, we had $3,787,678 in cash as compared to $547,498 as of October 31, 2024. The Company's working capital and other capital needs mainly come from shareholders' equity contributions and operating cash flows. Cash is needed to pay for inventory, wages, sales expenses, rent, income tax, and other operating expenses.

Although the Company's management believes that the cash generated from operations will be sufficient to meet the Company's normal working capital needs, its ability to service its current debts will depend on its future realization of its current assets for at least the next 12 months. The management has considered historical experience, economic conditions, trends in the beauty industry, the collectability of accounts receivable as of October 31, 2025, and the realization of inventory. Based on these considerations, the management believes that the Company has sufficient funds to meet its working capital needs and debt obligations, as they will be due at least 12 months from the date of financial reporting. However, there is no guarantee that the management's plan will be succeed. There are many factors that may occur and cause the Company's plan to fall short, such as economic conditions, competitive pricing in the industry and the continuous support of our suppliers. If future operating cash flows and other capital resources are insufficient to meet its liquidity needs, the Company may be forced to reduce or postpone its anticipated expansion plans, sell assets, acquire additional debt or equity capital, or refinance all or part of its debt.

The following table summarizes the Company's cash flow data for the fiscal years ended October 31, 2025, 2024 and 2023:

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Net cash provided by operating activities | $85852 | $960470 | $126537 |
| Net cash (used in)provided by investing activities | (572927) | (508143) | 1023419 |
| Net cash provided by(used in) financing activities | 3735677 | (957389) | (676925) |
| Net increase of cash | 3248602 | (505062) | 473031 |
| Effect of foreign currency translation | (8422) | 18926 | (14108) |
| Cash and cash equivalents– beginning of period | 547498 | 1033634 | 574711 |
| Cash and cash equivalents– end of period | $3787678 | $547498 | $1033634 |

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***Net cash provided by operating activities***

For the fiscal year ended October 31, 2025, the net cash provided by operating activities was $85,852, as compared to the net cash provided by operating activities of $960,470 for the fiscal year ended October 31, 2024. The decrease in net cash provided by operating activities was mainly due to the(i) decrease in fluctuations of contractual liabilities of $198,149, (ii) decrease in fluctuations of other receivables and other current assets of $287,456, (iii) increase in fluctuations of accounts receivable of $170,718, and(iv) increase in fluctuations of accounts payable of $164,236 for the year ended October 31, 2025.

For the fiscal year ended October 31, 2024, the net cash provided by operating activities was $960,470, as compared to the net cash provided by operating activities of $126,537 for the fiscal year ended October 31, 2023. The increase in net cash provided by operating activities was mainly due to the (i) increase in fluctuations of contractual liabilities of $1,057,807, (ii) decrease in fluctuations of accounts payable of $245,557, (iii) increase in fluctuations of accounts receivable of $239,005, (iv) increase in fluctuations of other receivables and other current assets of $228,893, and (v)decrease in fluctuations of other non-current assets of $168,396 for the year ended October 31, 2024.

***Net cash (used in)provided by investing activities***

 ****

For the fiscal year ended October 31, 2025, the net cash used in investment activities was $572,927, as compared to the net cash used in investment activities of $508,143 for the fiscal year ended October 31, 2024. The increase in net cash used in investment activities is mainly due to the decrease of loans repayment from franchisees.

For the fiscal year ended October 31, 2024, the net cash used in investment activities was $508,143, as compared to the net cash provided by investment activities of $1,023,419 for the fiscal year ended October 31, 2023. The decrease in net cash provided by investment activities is mainly due to the payment of franchisee loans granted to franchisees.

***Net cash provided by(used in) financing activities***

For the fiscal year ended October 31, 2025, the net cash provided by financing activities was $3,735,677, as compared to the net cash used in financing activities of $957,389 for the fiscal year ended October 31, 2024. The net cash provided by financing activities for the fiscal year ended October 31, 2025 was mainly due to the proceeds from issuance of shares

For the fiscal year ended October 31, 2024, the net cash used in financing activities was $957,389, as compared to the net cash provided by financing activities of $676,925 for the fiscal year ended October 31, 2023. The net cash used in financing activities for the fiscal year ended October 31, 2024 was mainly due to the payments to deferred IPO Cost.

Non-cash lease expenses

For the fiscal year ended October 31, 2025, our Company has operating leases for nine operating leases for its five self-operated stores, two employee dormitories, one warehouse and one office.

The right to use assets and liabilities of operating leases are recognized on the lease commencement date based on the present value of lease payments during the lease term. The discount rate used to calculate present value is the incremental borrowing rate, or (if any) the interest rate implied in the lease. The company mainly determines the incremental loan interest rate for each lease based on its lease term in China, with approximately 3.25%, 3.75% and 3.73% for the fiscal years ended October 31, 2025, 2024 and 2023, respectively.

For the fiscal years ended October 31, 2025, 2024 and 2023, the operating lease charges were $37,386, $30,425 and $45,869, respectively.

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Lease Cost |  |  |  |
| Operating lease cost | $37386 | $30425 | $45869 |
| Other Information |  |  |  |
| Cash paid for amounts included in the measurement of lease liabilities | $37043 | $30435 | $44654 |

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The components of the lease fee and the supplementary cash flow related to the lease are as follows:

As of October 31, 2025, 2024 and 2023, the weighted average lease term and discount rate are as follows:

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Weighted average remaining lease term – operating leases (in years) | 2.47 | 4.64 | 1.54 |
| Average discount rate – operating lease | 3.25% | 3.75% | 3.73% |

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The supplementary balance sheet information related to leasing is as follows:

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| | | |
|:---|:---|:---|
|  | **As of October 31,** | **As of October 31,** |
|  | **2025** | **2024** |
| Operating leases |  |  |
| Right-of-use assets | $180243 | $70739 |
| Operating lease liabilities, current | $104254 | $17573 |
| Operating lease liabilities, non-current | $75915 | $52745 |
| Total operating lease liabilities | $180169 | $70318 |

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The undiscounted minimum future lease payment schedule is as follows:

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| | |
|:---|:---|
| **For the years ending October 31,** | |
| 2026 | 39090 |
| 2027 | 75201 |
| 2028 | 48071 |
| 2029 | 23606 |
| 2030 |  |
| Total undiscounted lease payments | 185968 |
| Less imputed interest | (5799) |
| Total lease liabilities | 180169 |

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Concentration of credit risk

Cash deposits with banks are held in financial institutions in China, which deposits are not federally insured. Accordingly, the Company has a concentration of credit risk related to the uninsured part of bank deposits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk.

Concentration of customers and suppliers

The Company has a concentration risk related to suppliers and customers. Failure to maintain existing relationships with the suppliers or customers to establish new relationships in the future could negatively affect the Company's ability to obtain goods sold to customers in a price advantage and timely manner. If the Company is unable to obtain ample supply of goods from existing suppliers or alternative sources of supply, the Company may be unable to satisfy the orders from its customers, which could materially and adversely affect revenues.

The customers accounting for 10% or more of the Company's revenue include the following:

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Percentage of Company revenue |  |  |  |
| Customer G | 6% | 10% | 10% |
| Customer F | 6% | 10% | 10% |

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The customers that accounted for 10% or more of the Company's accounts receivable comprised of the following:

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Percentage of the Company's accounts receivable |  |  |  |
| Customer A | —% | 17% | 16% |
| Customer B | —% | 7% | 9% |
| Customer C | —% | 1% | 11% |
| Customer D | 4% | 3% | 4% |
| Customer E | —% | 8% | 3% |
| Customer F | —% | 15% | 18% |
| Customer G | —% | 4% | 17% |
| Customer J | 28% | —% | —% |
| Customer L | 11% | —% | —% |
| Customer K | 15% | —% | —% |

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The suppliers that accounted for 10% or more of the Company's purchases comprised of the following:

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Percentage of the Company's purchases |  |  |  |
| Supplier A | 8% | 15% | 9% |
| Supplier B | 9% | 11% | 7% |
| Supplier C | 5% | 10% | —% |
| Supplier D | 26% | —% | —% |
| Supplier E | 11% | 5% | 1% |
| Supplier F | 1% | 11% | 58% |

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The suppliers that accounted for 10% or more of the Company's accounts payable comprised of the following:

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| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Percentage of the Company's accounts payable |  |  |  |
| Supplier F | —% | 36% | 63% |
| Supplier G | 81% | 55% | 7% |
| Supplier H | 19% | 9% | 4% |

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Contract liability

The contract liabilities consist of advances from customers, which relate to unsatisfied performance obligations at the end of each reporting period and consists of cash payments received in advance from customers in sales of beauty products and devices and unearned franchise fee. As of October 31, 2025 and October 31, 2024, the Company's advances from customer deposit and unearned franchise fee amounted to $194,753 and $325,924 respectively.

**Trend Information**

Except as disclosed elsewhere in this annual report, we are not aware of any trends, uncertainties, demands, commitments or events that may reasonably be likely to have a significant impact on our net income, income from continuing operations, profitability, working capital or capital resources, or that would cause reported may not necessarily to be indicative of future operating results or financial condition.

**Off-Balance Sheet Arrangements**

Except as disclosed elsewhere in this annual report, we have not entered into any financial guarantees or other commitments to ensure the payment obligations of any third party. We have not entered into any derivative contracts that are indexed to its shares and classified as shareholders' equity or that are not reflected in its consolidated financial statements. In addition, we do not have any retained or contingent interests in the assets transferred to unconsolidated entities that services as credit, liquidity, or market risk support to such entities. We do not have any variable interests in any unconsolidated entity that provides us with financing, liquidity, market risk or credit support, or that engages in leasing, hedging or research and development services.

**Critical Accounting Policies and Estimates**

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements. These financial statements are prepared in accordance with U.S. GAAP, which requires us to make estimates and assumptions that affect the reported amounts of our assets and liabilities and revenue and expenses, to disclose contingent assets and liabilities on the date of the consolidated financial statements, and to disclose the reported amounts of revenue and expenses incurred during the financial reporting period. The most significant estimates and assumptions include the assessment of the expected credit losses for receivables. We continue to evaluate these estimates and assumptions that we believe to be reasonable under the circumstances. We rely on these evaluations as the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from those estimates. Some of our accounting policies require higher degrees of judgment than others in their application. We believe critical accounting policies as disclosed in this annual report reflect the more significant judgments and estimates used in preparation of our consolidated financial statements.

The following critical accounting policies rely upon assumptions and estimates and were used in the preparation of our consolidated financial statements:

Credit Losses

On January 1, 2023, we adopted Accounting Standards Update ("ASU") 2016-13 "Financial Instruments — Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments," by using a modified retrospective transition method, which replaces the incurred loss impairment methodology with an expected loss methodology that is referred to as the current expected credit loss methodology. The expected credit loss impairment model requires the entity to recognize its estimate of expected credit losses for affected financial assets using an allowance for credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The adoption of ASU 2016-13 did not have a material impact on our financial statements.

Our account receivables, loans receivable from franchisees, due from related parties and other receivables which is included in other receivables and other current assets line item in the balance sheet are within the scope of ASC Topic 326. We use the roll-rate method to measure expected credit losses of loans receivable from franchisees, on a collective basis when similar risk characteristics exist. The roll-rate method stratifies the receivables balance by delinquency stages and projected forward in one-year increments using historical roll rate. In each year of the simulation, losses on the receivables are captured, and the ending delinquency stratification serves as the beginning point of the next iteration. This process is repeated on a yearly rolling basis. The loss rate calculated for each delinquency stage is then applied to respective receivables balance. The management adjusts the allowance that is determined by the roll-rate method for both current conditions and forecasts of economic conditions. For account receivables, due from related parties and other receivables, we use the loss-rate method to evaluate the expected credit losses on an individual basis. When establishing the loss rate, we make the assessment on various factors, including historical experience, credit-worthiness of debtors, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect its ability to collect from the debtors. We also provide specific provisions for allowance when facts and circumstances indicate that the receivable is unlikely to be collected.

Expected credit losses are included in the consolidated statements of operations and comprehensive income. After all attempts to collect a receivable have failed, the receivable is written off against the allowance. Account receivables, loans receivable from franchisees, due from related parties and other receivables are recognized and carried at original amount less an allowance for credit losses, as necessary. As of October 31, 2025 and 2024, allowance for credit losses for accounts receivable amounted to $144,859 and $231,851, respectively, allowance for credit losses for loan to franchisees amounted to $232,876, and $55,520, respectively, and allowance for credit losses for other receivables amounted to $11,002 and $51,013, respectively.

Quantitative and qualitative disclosure of market risk

The deterioration of the overall economic conditions in the United States and globally, including the impact of long-term deflation on our customers and suppliers, may harm our business and operational results.

Our business and operating results may be adversely affected by changes in national or global economic conditions. These situations include but are not limited to inflation and/or deflation, changes in interest rates, availability of capital markets, availability and cost of energy (including fuel surcharges), negative impacts caused by military conflicts between Russia and Ukraine, and the impact of government measures to manage economic conditions. The impact of such situations may be transmitted to our business in the form of a decrease in customer base and/or our customer expenses, as industry wide expenses may decrease and/or our suppliers may face economic pressure to shift costs.

Risks related to conducting business in China

The recent intervention of the state government in the commercial activities of Chinese companies listed in the United States may have a negative impact on our operations.

Recently, the Chinese government announced that it will strengthen regulation of Chinese companies listed overseas. According to the new measures, China will strengthen the supervision of cross-border data flow and security, crack down on illegal activities in the securities market, punish fraudulent securities issuance, market manipulation, and insider trading. China will also inspect the sources of funds for securities investment and control leverage. The Cyberspace Administration also conducted cybersecurity investigations on several technology giants listed in the United States, with a focus on antitrust, fintech regulation, and recently, with the passage of the Data Security Law, how companies collect, store, process, and transfer data. Our operations and commercial interests are in Chinese Mainland. If the intervention of the Chinese government is expanded and through agency, our commercial interests will be affected, and our operations may be negatively affected, although there is currently no obvious direct impact.

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

**A. Directors and Senior Management**

The following table sets forth certain information concerning our directors and executive officers as of the date of this annual report. The business address for our directors and executive officers is that of our principal executive offices at 901, Building C, Phase 2, Wuxi International Life Science Innovation Campus, 196 Jinghui East Road, Xinwu District, Wuxi, Jiangsu Province, People's Republic of China 214000.

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position** |
| Xiaoqiu Zhang | 46 | Chief Executive Officer, Chairperson of the Board of Directors |
| Li Wang | 43 | Director |
| Xiaoyan Zhu | 48 | Chief Financial Officer |
| Xinyu Li | 41 | Product Manager, Chief Technology Officer |
| Yanan Shan | 41 | Independent Director |
| Qixiong Sheng | 46 | Independent Director |
| Xiaozhong Yu | 46 | Independent Director |
| Da Yang | 38 | Independent Director,resigned on August 25, 2025 |

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***Ms. Xiaoqiu Zhang*** has served as the CEO of Xinzhan since March 2016. Ms. Zhang has over 10 years of business success, with a diverse knowledge of operations management and corporate governance. She became a Director of Park Ha Cayman on October 11, 2022. She is also serving as the independent director and chair of nominating and corporate governance committee of Mingteng International Corporation Inc. (Nasdaq: MTEN). She started her career working as a manager from September 2000 to May 2015 in Wuxi Jiazi Healthy Consulting Co., Ltd. From June 2015 to February 2016, Ms. Zhang served as the director of TopLinker Co., Ltd. (National Equities Exchange and Quotations: 837914). Ms. Zhang became CEO of Park Ha Cayman on July 5, 2023. Ms. Zhang completed post-secondary education at Nanjing Political College in 2005 and graduated from Northeast University of Finance and Economics with a Bachelor's Degree in Business Administration in October 2020. In addition, Ms. Zhang completed the senior general manager program at China Europe International Business School in November 2020.

***Ms. Li Wang*** has served as our Director of Xinzhan since May 2018 and a Director of Park Ha Cayman since July 5, 2023. Ms. Wang worked as a commissioner from November 2005 to December 2008 in Wuxi Wuzhou International Home and Live Mall Co., Ltd. From March 2009 to February 2010, Ms. Wang served as a property consultant in WorldUnion Properties Consultancy Co., Ltd. From May 2010 to July 2012, Ms. Wang worked in Southern Jiangsu Province SUNAC Real Estate Development Co., Ltd as a sale assistant. Ms. Wang worked as a sales administrator in Jinke Real Estate Development Co., Ltd in July 2012 to April 2018. Ms. Wang has been pursuing a technical college degree in Law in Wuxi Taihu College since July 2021.

***Ms. Xiaoyan Zhu*** has served as the CFO of Xinzhan since May 2016 and our CFO since July 2024. Ms. Zhu served as Accounting Supervisor of Wuxi Yongxin Material Company since 1998 to 2000. Ms. Zhu also served as the Chief Finance Officer of Wuxi Lantu Decoration Limited. since 2002 to 2006. Prior to joining us, Ms. Zhu was the Chief Technology Officer and an executive director in the Wuxi Qingcheng Beauty Salon from 2005 to 2012. From 2013 to 2016, she was a freelancer. Ms. Zhu received a technical college degree in Economics and Administration Management from Nanjing Political Science Institute of Politics in 2007.

***Ms. Xinyu Li*** has served as our Product Manager of Park Ha Shanghai since May 2021. Ms. Li also became Park Ha Cayman's Chief Technology Officer in July 2024. Ms. Li served as a secretary in XI'AN LEAD Metrology Co., Ltd from June 2005 to August 2006. And Ms. Li worked in foreign trade in Shanghai Longxin Glassware Co., Ltd from August 2006 to October 2007. From November 2007 to June 2010, Ms. Li worked as business section chief in Shanghai La Fantcy Cosmetics Co., Ltd. From June 2010 to September 2019, Ms. Li worked as product manager in Shanghai Zhengmingming Cosmetics Co., Ltd. Ms. Li worked as product manager in Wuxi Ailing Biotechnology Co., Ltd from September 2019 to November 2020. Ms. Li completed undergraduate coursework as an English major at Xi'an International Studies University in June 2006.

***Ms. Yanan Shan*** will be appointed as an independent director and will be the chairman of the audit committee and a member of the compensation committee and the nominating committee of our Company. Ms. Shan has over 18 years of experience in accounting. She has served as the Board Secretary and Chief Financial Officer at Wuxi Al-Top New Metal Material CO., Ltd (National Equities Exchange and Quotations, "the New Third Board": 872285) since April 2013. Previously, she served as the Financial Supervisor at Suzhou Dongshan Precision Manufacturing Co., Ltd. from June 2010 to March 2013, and General Ledger Accountant at Wuxi Tongda Jinxing Steel Cutting Co., Ltd from September 2006 to April 2010. She is a Certified Management Accountant and holds an Accounting Professional Qualification (Intermediate) (China) and a Board Secretary Qualification Certificate from the Shenzhen Stock Exchange. She completed post-secondary education in Accounting at Suzhou University in 2014.

***Mr. Qixiong Sheng*** is our independent director and the chairman of the compensation committee and a member of the audit committee and the nominating committee of our Company. Mr. Sheng is a seasoned professional with 22 years of experience in the automotive industry. Currently, he serves as the General Manager of the Porsche brand at Wuxi Yongda Dongfang Automobile Sales & Service Co., Ltd., a subsidiary of China Yongda Automobile Services Hldg (SEHK: 3669). He co-currently holds the role of Regional Director for the Porsche Group, Southern Region, overseeing six companies in the Southern Region. He is also the Head of New Energy Group (Jiangsu) managing multiple new energy vehicle brands in Jiangsu Province. Previously, Sheng held significant positions such as General Manager for the BMW brand at Wuxi Baochenggaohui Automobile Sales & Service Co., Ltd, in Ningbo, Zhejiang Province, from May 2011 to April 2014, and for the MINI brand at Wuxi Baocheng Automobile Sales & Service Co., Ltd in Wuxi from July 2007 to December 2011. Mr. Sheng is also an active community in the automotive industry in Wuxi, and currently serves as the Vice President of the Wuxi Automotive Industry Association. He completed post-secondary education in Marketing at Shanghai Business School in 2002.

***Mr. Xiaozhong Yu*** is our independent director and the chairman of the nominating committee and a member of the compensation committee and the audit committee of our Company. As the Director of Beijing Tianchi Juntai (Wuxi) Law Firm, Mr. Yu has a wealth of experience in the legal industry. Mr. Yu serves as legal counsel to over 20 governmental and corporate entities, excelling in a wide variety of cases including criminal, civil, and administrative litigation and arbitration. He also provides legal advice to several private companies on compliance and risk management covering company establishment, employment matters, internal policy development, contract drafting, environmental law compliance, taxation, and workplace safety. Furthermore, he provides legal support and advice to local administrative agencies such as regulatory documents drafting, contract review, and administrative penalties. Mr. Yu was named the "Outstanding Lawyer in Wuxi 2016 – 2017" and the "Outstanding Young Lawyer in Wuxi 2017 – 2018". He also holds leadership roles in the Wuxi Lawyers' Association. Mr. Yu obtained a Bachelor's Degree in Law from Jiangnan University in 2002.

***Mr. Da Yang*** is our independent director. Mr. Yang has had many years of experience in sales and marketing. Mr. Yang served as the market director in Beijing City New Space Technology Co., Ltd. since January 2021. From June 2017 to June 2020, Mr. Yang was a senior marketing manager in Gome Insurance Brokers Limited. From October 2015 to August 2016, Mr. Yang was an assistant to the general manager in Dade Liangju Trading (Beijing) Co., Ltd. Mr. Yang obtained his college degree in music performance (music) from Capital Normal University in 2008.MR.Da Yang resigned from the company on August 25, 2025.

***Family Relationships***

There are no family relationships among any of our directors or executive officers as defined in Item 401 of Regulation S-K.

**B. Compensation**

For the fiscal year ended October 31, 2025, we paid an aggregate of RMB368,846 (US$51,120) to our executive officers. We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our directors and executive officers. The PRC subsidiaries are required by law to make contributions equal to certain percentages of each employee's salary for his or her pension insurance, medical insurance, unemployment insurance and other statutory benefits and a housing provident fund.

***Employment Agreements***

We have entered into employment agreements with each of our executive officers. Each executive officer has agreed to hold, both during and after the termination or expiry of his or her employment agreement, in strict confidence and not to use, except as required in the performance of his or her duties in connection with the employment or pursuant to applicable law, any of our confidential information or trade secrets, any confidential information or trade secrets of our customers or prospective customers, or the confidential or proprietary information of any third party received by us and for which we have confidential obligations and rights for these inventions, designs and trade secrets.

In addition, each executive officer has agreed to be bound by non-competition and non-solicitation restrictions during the term of his or her employment. Specifically, each executive officer has agreed not to engage in business that is similar or identical to the Company's business, or to provide assistance for any individual or organization who is involved in similar or identical business with the Company.

**C. Board Practices**

***Board of Directors and Committees***

Our Board of Directors consists of six directors. A director is not required to hold any shares in our Company to qualify to serve as a director. Subject to the rules of the relevant stock exchange and disqualification by the chairman of the board of directors, a director may vote with respect to any contract, proposed contract, or arrangement in which he or she is materially interested. A director may exercise all the powers of the Company to borrow money, mortgage its business, property and uncalled capital and issue debentures or other securities whenever money is borrowed or as security for any obligation of the Company or of any third party. There are no directors' service contracts with the Company or its subsidiaries providing for benefits upon termination of employment.

We have established an audit committee, a compensation committee and a nominating and corporate governance committee under the Board of Directors. We have adopted a charter for each of the three committees.

Each committee's members and functions are described below.

*Audit Committee.* Our audit committee consists of Ms. Yanan Shan, Mr. Qixiong Sheng, and Mr. Xiaozhong Yu and Ms. Yanan Shan is the chair of our audit committee. The audit committee will oversee our accounting and financial reporting processes and the audits of the financial statements of our company. The audit committee is responsible for, among other things:

● appointing the independent auditors and pre-approving all auditing and non-auditing services permitted to be performed by the independent auditors;

● reviewing with the independent auditors any audit problems or difficulties and management's response;

● discussing the annual audited financial statements with management and the independent auditors;

● reviewing the adequacy and effectiveness of our accounting and internal control policies and procedures;

● reviewing and approving all proposed related party transactions;

● meeting separately and periodically with management and the independent auditors; and

● monitoring compliance with our code of business conduct and ethics, including reviewing the adequacy and effectiveness of our procedures to ensure proper compliance.

*Compensation Committee**.*** Our compensation committee consists of Ms. Yanan Shan, Mr. Qixiong Sheng, and Mr. Xiaozhong Yu and Mr. Qixiong Sheng is the chair of our compensation committee. The compensation committee is responsible for, among other things:

● reviewing and approving, or recommending to the board for its approval, the compensation for our chief executive officer and other executive officers;

● reviewing and recommending to the shareholders for determination with respect to the compensation of our directors;

● reviewing periodically and approving any incentive compensation or equity plans, programs or similar arrangements; and

● selecting compensation consultant, legal counsel or other adviser only after taking into consideration all factors relevant to that person's independence from management.

*Nominating Committee.* Our nominating committee consists of Ms. Yanan Shan, Mr. Qixiong Sheng, and Mr. Xiaozhong Yu and Mr. Xiaozhong Yu is the chair of our nominating committee. We have determined that Ms. Yanan Shan, Mr. Qixiong Sheng, and Mr. Xiaozhong Yu satisfy the "independence" requirements under Nasdaq Rule 5605. The nominating committee will assist the Board of Directors in selecting individuals qualified to become our directors and in determining the composition of the board and its committees. The nominating committee is responsible for, among other things:

● selecting and recommending to the board nominees for election by the shareholders or appointment by the board;

● reviewing annually with the board the current composition of the board with regards to characteristics such as independence, knowledge, skills, experience and diversity;

● making recommendations on the frequency and structure of board meetings and monitoring the functioning of the committees of the board; and

● advising the board periodically with regards to significant developments in the law and practice of corporate governance as well as our compliance with applicable laws and regulations, and making recommendations to the board on all matters of corporate governance and on any remedial action to be taken.

**Duties of Directors**

As a matter of Cayman Islands law, directors of a Cayman Islands company owe fiduciary duties to the company and separately a duty of care, diligence and skill to the company. Under Cayman Islands law, directors and officers owe the following fiduciary duties: (i) a duty to act in good faith in what the director or officer believes to be in the best interests of the company as a whole; (ii) a duty to exercise powers for the purposes for which those powers were conferred and not for a collateral purpose; (iii) directors should not improperly fetter the exercise of future discretion; (iv) a duty to exercise powers fairly as between different classes of shareholders; (v) a duty to exercise independent judgment; and (vi) a duty not to put themselves in a position in which there is a conflict between their duty to the company and their personal interests. In fulfilling their duty of care to our Company, our directors must ensure compliance with our amended and restated memorandum and articles of association, as amended and restated from time to time. Our Company may have the right to seek damages if a duty owed by our directors is breached.

Our Board of Directors has all the powers necessary for managing, and, for directing and supervising, our business affairs. The functions and powers of our Board of Directors include, among others:

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

● declaring dividends and distributions;

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

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

● approving the transfer of shares in our company, including the registration of such transfer in our register of members.

**Terms of Directors and Officers**

Our directors may be appointed by an ordinary resolution of our shareholders. Alternatively, our Board of Directors may, by the majority resolution of the directors, appoint any person as a director to fill a casual vacancy on our board or as an addition to the existing board. Our directors are not automatically subject to a term of office and hold office until such time as they are removed from office by an ordinary resolution of our shareholders. In addition, a director will cease to be a director if he (i) becomes bankrupt or makes any arrangement or composition with his creditors; (ii) dies or is found to be or becomes of unsound mind; (iii) resigns his office by notice in writing; (iv) without special leave of absence from our board, is absent from meetings of our board for three consecutive meetings and our board resolves that the director has, by reason of such absence, vacated office; or (v) is removed from office by resolution of all of the other directors (being no less than two in number).

Our officers are appointed by and serve at the discretion of the Board of Directors, and may be removed by our Board of Directors.

**D. Employees**

As of October 31, 2025, we had 40 full-time employees in China. The following table sets forth a breakdown of our full-time employees by function as of October 31, 2025.

---

| | |
|:---|:---|
| **Functions** | **As of <br> October 31,<br> 2025** |
| Senior Management | 3 |
| Warehouse Management | 1 |
| Finance | 1 |
| Research and Development | 1 |
| Production & Procurement | 1 |
| Sales and Marketing | 29 |
| Human Resources & Administration | 2 |
| General Affairs | 3 |
| **Total** | 41 |

---

Our success depends on our ability to attract, motivate, train and retain qualified personnel. We believe we offer our employees competitive compensation packages and an environment that encourages self-development and, as a result, have generally been able to attract and retain qualified personnel and maintain a stable core management team.

As required by regulations in China, we participate in various mandatory employee social security plans that are organized by local governments, including social insurance, pension, unemployment insurance, childbirth insurance, work-related injury insurance, medical insurance and housing insurance. We are required under Chinese law to make contributions to employee benefit plans at specified percentages of the salaries, bonuses and certain allowances of our employees, up to a maximum amount specified by the local government.

Our employees are not represented by a labor organization or covered by a collective bargaining agreement. We believe that we maintain a good working relationship with our employees and to date, we have not experienced any significant labor disputes.

**E. Share Ownership**

As of the date of this annual report, the company authorized share capital is US$3,000,000 divided into 2,400,000,000 Class A Ordinary Shares of par value of US$0.001 each and 600,000,000 Class B Ordinary Shares of par value US$0.001 each, of which 2,839,524 have been issued and outstanding as Class A Ordinary Shares of par value of US$0.001 each and 381,000 have been issued and outstanding as Class B Ordinary Shares of par value of US$0.001.

The following tables sets forth the principal holders of the company issued and outstanding share capital and their respective shareholding as the date of this annual report.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Class A <br> Ordinary Shares** | **Class A <br> Ordinary Shares** | **Class B<br> Ordinary Shares** | **Class B<br> Ordinary Shares** | **Voting <br> Power** |
|  | **Number** | **%<sup>(1)</sup>** | **Number** | **%<sup>(1)</sup>** | **%** |
| **Name of Beneficial Owners** | | | | | |
| ***Directors and Executive Officers:*** |  |  |  |  |  |
| Xiaoqiu Zhang<sup>(2)</sup> |  |  | 381000 | 100 | 72.85 |
| Li Wang<sup>(3)</sup> | \* | \* |  |  |  |
| Xiaoyan Zhu<sup>(3)</sup> | \* | \* |  |  |  |
| Xinyu Li |  |  |  |  |  |
| Yanan Shan |  |  |  |  |  |
| Qixiong Sheng |  |  |  |  |  |
| Xiaozhong Yu |  |  |  |  |  |
| *All executive officers and directors as a group (6 persons)* |  |  | 381000 | 100 | 72.85 |
| ***5% or Greater Shareholders:*** |  |  |  |  |  |
| Xiaoqiu Holding Ltd<sup>(2)</sup> |  |  | 381000 | 100 | 72.85 |
| Jie Cao | 157000 | 5.53 |  |  | 1.50 |
| Lingfu Fan | 154600 | 5.45 |  |  | 1.48 |
| Minyun Li | 157400 | 5.54 |  |  | 1.50 |
| Liujie International Holding Limited | 311000 | 10.95 |  |  | 2.97 |
| Qi Meng | 147400 | 5.19 |  |  | 1.41 |
| Minyun International Holding Limited | 251000 | 8.84 |  |  | 2.40 |
| Yajie International Holding Limited | 311261 | 10.96 |  |  | 2.98 |
| Zhongyong Import And Export Trade Co., Limited | 180000 | 6.34 |  |  | 1.72 |
| Qianqian Zhou | 151400 | 5.33 |  |  | 1.45 |
| Others | 1018463 | 35.87 |  |  | 9.74 |

---

\* Less than 1%

(1) Applicable percentage of ownership is based on 2,839,524
 class A Ordinary Shares and 381,000 Class B Ordinary Shares issued and outstanding as of the date of this annual report. Holders
 of Class A Ordinary Shares are entitled to one (1) vote per share. Holders of Class B Ordinary Shares are entitled to twenty (20)
 votes per share.

(2) Xiaoqiu Zhang beneficially
 owns 381,000 Class B Ordinary Shares indirectly through Xiaoqiu Holding Ltd, a company formed under the laws of the British Virgin
 Islands and of which Xiaoqiu Zhang is the sole shareholder and director.

(3) Changxin International
 Limited Partnership, a company formed under the laws of the British Virgin Islands, of which Li Wang, Xiaoyan Zhu and Guozhen Liu
 are limited partners.

**F. Disclosure of a registrant's action to recover erroneously awarded compensation**

Not applicable.

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

**A. Major Shareholders**

See "Item 6. Directors, Senior Management and Employees — E. Share Ownership." The Company's major shareholders do not have different voting rights than the other shareholders.

**B. Related Party Transactions**

The Company had transactions with the following related parties:

---

| | |
|:---|:---|
| **Name of Related Party** | **Nature of Relationship** |
| Guozhen Liu | Limited partner of Changxin International Limited Partnership, executive director and legal representative of Park Ha Shanghai, supervisor of Xinzhan, parent of Xiaoqiu Zhang |
| Fujun Yu | Legal representative and executive director of Park Ha Jiangsu, supervisor of Park Ha Shanghai |
| Hengquan Zhang | Supervior of Park Ha Jiangsu, parent of Xiaoqiu Zhang |
| Xiaoqiu Zhang | CEO, Chairperson of the board of directors, controlling shareholder of Park Ha Cayman |
| Li Wang | Supervior of Park Ha Investment,director of the Company |

---

 **

***Due from related party***

 **

The Company made advances to Ms. Xiaoqiu Zhang for working capital to be paid on behalf of the Company. The balance due from Ms. Xiaoqiu Zhang was $35, $14,399 and $nil as of October 31, 2025, 2024 and 2023, respectively.

The Company made advances to Mr. Hengquan Zhang for working capital to be paid on behalf of the Company. The balance due from Mr. Hengquan Zhang was $nil, $nil and $10,964 as of October 31, 2025, 2024 and 2023, respectively.

The Company made advances to Mr. Fujun Yu for working capital to be paid on behalf of the Company. The balance due from Mr. Fujun Yu was $nil, $nil and $6,277 as of October 31, 2025, 2024 and 2023, respectively.

***Due to related party***

 ****

The Company received advances from Ms. Guozhen Liu as working capital. The balance due to Ms. Guozhen Liu was $ nil, $nil and $6,565 as of October 31, 2025, 2024 and 2023, respectively.

The Company received advances from Ms. Xiaoqiu Zhang as working capital. The balance due to Ms. Xiaoqiu Zhang was $nil, $nil and $61,596 as of October 31, 2025, 2024 and 2023, respectively.

Ms. Li Wang made a payment for rent on behalf of the Company. The balance due to Ms. Li Wang was $7,026 and $nil as of October 31, 2025 and 2024, respectively.

The amounts due from related party and due to related party above are non-interest bearing, without maturity and due on demand.

**C. Interests of Experts and Counsel**

Not Applicable.

**ITEM 8. FINANCIAL INFORMATION**

**A. Consolidated Statements and Other Financial Information**

We have appended consolidated financial statements filed as part of this annual report.

***Legal Proceedings***

From time to time, we may become involved in actions, claims, suits, and other legal proceedings arising in the ordinary course of its business, including assertions by third parties relating to intellectual property infringement, breaches of contract or warranties or employment-related matters. We are not currently a party to any actions, claims, suits or other legal proceedings the outcome of which management believes, if determined adversely to us, would individually or in the aggregate have a material adverse effect on our business, financial condition, and results of operations.

***Dividend Policy***

We currently intend to retain all available funds and any future earnings to support operations and to finance the growth and development of our business. Therefore, we do not expect to pay cash dividends in the foreseeable future. Any future determination relating to our dividend policy will be made at the discretion of our Board of Directors and will depend on a number of factors, including future earnings, capital requirements, financial condition and future prospects and other factors the Board of Directors may deem relevant.

**B. Significant Changes**

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. Offer and listing details**

Our Ordinary Shares have been listed on the Nasdaq Capital Market under the symbol "PHH." The Ordinary Shares began trading on December 27, 2024 on the Nasdaq Capital Market.

**B. Plan of distribution**

Not applicable.

**C. Markets**

See "— A. Offer and Listing Details" above.

**D. Selling shareholders**

Not applicable.

**E. Dilution**

Not applicable.

**F. Expenses of the issue**

Not applicable.

**ITEM 10. ADDITIONAL INFORMATION**

On October 24, 2025, Park Ha Biological Technology Co., Ltd. (the "Company") announced a change of trading symbol for its ordinary shares to "BYAH" (from "PHH"), which the Company effective on the Nasdaq Stock Market at the open of trading on Monday October 28, 2025.

On October 24, 2025, the Company issued a press release, a copy of which is attached hereto as Exhibit 99.1 to this Report of Foreign Private Issuer on Form 6-K, announcing the ticker symbol change.

**A. Share capital**

As of October 31, 2025, our authorized share capital is US$300,000 divided into 12,000,000,000 Class A Ordinary Shares of par value US$0.00002 each and 3,000,000,000 Class B Ordinary Shares of par value of US$0.00002 each.

As of October 31, 2025, before the reverse stock split, we have 14,824,403 Class A Ordinary Shares and 19,050,000 Class B Ordinary Shares issued and outstanding.

On February 9, 2026, we implement a 1-for-50 reverse stock split effective February 20, 2026, subject to the Company's satisfaction of Nasdaq Operations notice requirements, with trading to begin on a split-adjusted basis at the market open on that day. We have retroactively restated all share and per share data for all of the periods presented pursuant to ASC 260 to reflect the Reverse Split. As of October 31, 2025, there were 296,488 Class A ordinary shares and 381,000 Class B ordinary shares issued and outstanding.

As of the date of this report, our authorized share capital is US$3,000,000 divided into 2,400,000,000 Class A Ordinary Shares of par value of US$0.001 each and 600,000,000 Class B Ordinary Shares of par value US$0.001 each.

As of the date of this report, we have 2,839,524 Class A Ordinary Shares and 381,000 Class B Ordinary Shares issued and outstanding.

**B. Memorandum and articles of association**

The following are summaries of the material provisions of our amended and restated memorandum and articles of association and the Companies Act (as amended), insofar as they relate to the material terms of our Ordinary Shares. They do not purport to be complete. Reference is made to our amended and restated memorandum and articles of association, a copy of which is filed as an exhibit to the annual report.

Park Ha Cayman was incorporated as an exempted company with limited liability under the laws of the Cayman Islands and our affairs are governed by our amended and restated memorandum and articles of association, as amended and restated from time to time (the "Articles"), and the Companies Act (as amended) of the Cayman Islands, or the "Cayman Islands Companies Act." A Cayman Islands exempted company with limited liability:

● 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 effect 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 as a limited duration company; and

● may register as a segregated portfolio company.

"Limited liability" means that the liability of each shareholder is limited to the amount unpaid by the shareholder on that shareholder's shares of the company (except in exceptional circumstances, such as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other circumstances in which a court may be prepared to pierce or lift the corporate veil).

**Our Amended and Restated Memorandum and Articles of Association**

The following are summaries of material provisions of our amended and restated memorandum and articles of association and the Cayman Islands Companies Act insofar as they relate to the material terms of our Ordinary Shares.

 

*Ordinary Shares*

In connection with the reverse stock split, we filed an Amended and Restated Memorandum of Association, with the Registry of Companies of the Cayman Islands on February 4, 2026 to reduce the authorized share capital of the Company from USD 3,000,000.00 divided into divided into 150,000,000,000 ordinary shares of par value US$0.00002 each divided into (i) 120,000,000,000 Class A ordinary shares with a par value of US$0.00002 each with 1 vote per share and (ii) 30,000,000,000 Class B ordinary shares with a par value of US$0.00002 each with 20 votes per share to 3,000,000,000 ordinary shares of par value US$0.001 each divided into (i) 2,400,000,000 Class A ordinary shares with a par value of US$0.001 each with 1 vote per share and (ii) 600,000,000 Class B ordinary shares with a par value of US$0.001 each with 20 votes per share, the reduction at the same ratio as its reduction in the issued and outstanding shares. As approved and authorized by a majority of the shareholders of at an extraordinary meeting of shareholders held on December 26, 2025, the Board of Directors of the Company subsequently approved the reverse stock split and the exact ratio of the reverse stock split on January 29, 2026.

As of the date of this report, our authorized share capital is US$3,000,000 divided into 2,400,000,000 Class A Ordinary Shares of par value of US$0.001 each and 600,000,000 Class B Ordinary Shares of par value US$0.001 each. All of our shares to be issued in the offering will be issued as fully paid. Holders of Class A Ordinary Shares and Class B Ordinary Shares have the same rights except for voting and conversion rights. In respect of matters requiring a vote of all shareholders by way of poll, each holder of Class A Ordinary Shares will be entitled to one vote per one Class A Ordinary Share and each holder of Class B Ordinary Shares will be entitled to 20 votes per one Class B Ordinary Share. The Class A Ordinary Shares are not convertible into shares of any other class. The Class B Ordinary Shares are convertible into Class A Ordinary Shares at any time after issuance at the option of the holder on a one-to-one basis.

All of our issued and outstanding Class A Ordinary Shares and Class B Ordinary Shares are fully paid and non-assessable. Our Class A Ordinary Shares and Class B Ordinary Shares are issued in registered form, and are issued when registered in our register of members. Unless the board of directors determine otherwise, each holder of our Class A Ordinary Shares or Class B Ordinary Shares will not receive a certificate in respect of such shares. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their Class A Ordinary Shares and Class B Ordinary Shares. We may not issue shares to bearer.

Subject to the provisions of the Cayman Companies Act and our Articles regarding 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. Such authority could be exercised by the directors to allot shares which carry rights and privileges that are preferential to the rights attaching to Class A Ordinary Shares or Class B 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 Class A Ordinary Shares are listed on Nasdaq under the symbol "BYAH."

*Transfer Agent*

The transfer agent and registrar for our Ordinary Shares is Transhare Corporation.

 

*Dividends*

Subject to the provisions of the Cayman Islands Companies Act and the Articles, the directors may declare dividends or distributions out of our funds which are lawfully available for that purpose.

Under the laws of the Cayman Islands, our Company may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would result in our company being unable to pay its debts as they fall due in the ordinary course of business. The directors when paying dividends to shareholders may make such payment either in cash or in specie.

No dividend shall bear interest as against the Company.

 

*Voting Rights*

On a poll, every shareholder who is present in person and every person representing a shareholder by proxy shall have one vote for each Class A Ordinary Share and 20 votes for each Class B Ordinary Share of which he or the person represented by proxy is the holder. In addition, all shareholders holding shares of a particular class are entitled to vote at a meeting of the holders of that class of shares. Votes may be given either personally or by proxy.

 

*Conversion Rights*

Class A Ordinary Shares are not convertible. Class B Ordinary Shares are convertible, at the option of the holder thereof, into Class A Ordinary Shares on a one-to-one basis.

 

*Variation of Rights of Shares*

If at any time our share capital is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may be varied either (a) by, or with the approval of, the directors without the consent of the holders of the shares of the affected class if the directors determine that the variation or abrogation is not materially adverse to the interests of those shareholders, or (b) with the consent in writing of the holders of two-thirds of the issued shares of that class, or with the sanction of a special resolution passed at a separate general meeting of the holders of that class of share, provided that the necessary quorum for such meeting shall be one or more persons holding or representing by proxy one-third of the issued shares of the class, and at which any holder of shares of the class present in person or by proxy may demand a poll.

Unless otherwise expressly provided by the terms of issue of any class, the rights conferred on the holders of shares of that class shall not be deemed to be varied by the creation or issue of further shares ranking pari passu with that class.

 

*Alteration of Share Capital*

Subject to the Cayman Islands Companies Act, our shareholders may, by ordinary resolution:

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

&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;(c) subject
 to the Cayman Islands Companies Act, sub-divide our shares or any of them into shares of
 smaller amounts than that fixed; and

&nbsp;&nbsp;&nbsp;&nbsp;(d) cancel
 any shares which, at the date of the passing of that ordinary resolution, have not been taken
 or agreed to be taken by any person.

Subject to the Cayman Islands Companies Act and the Articles, we may, by special resolution of our shareholders, reduce the share capital of the Company and any capital redemption reserve in any manner.

 

*Calls on Shares and Forfeiture*

The directors may, from time to time, make calls on the shareholders in respect of some or all of any monies unpaid on their shares, whether in respect of par value or the premium payable on those shares, and each shareholder shall (subject to receiving at least 14 days' notice specifying the time or times of payment), pay to us at the time or times so specified the amount called on his shares. The directors may revoke or postpone a call at any time. The joint holders of a share shall be jointly and severally liable to pay all calls in respect of the share and the holder or joint holders of a share at the time of a call shall remain liable to pay the call on that share, notwithstanding any subsequent transfer of the share being registered by the Company. If a sum called in respect of a share is not paid before or on the day appointed for payment of that call, the shareholder from whom it is due and payable shall pay interest on the sum at such rate as the directors may determine from the day appointed for payment of the call to the time of the actual payment. The directors may, at their discretion, waive payment of the interest in full or in part.

We have a first and paramount lien on every share (whether or not it is a fully paid share). The lien is for all monies, whether presently payable or not, called or payable at a fixed time in respect of that share and for all debts, liabilities or other obligations owed, whether presently or not, by the shareholder or by one or more joint shareholders or by any of their estates to the Company.

At any time, the directors may declare any share to be wholly or in part exempt from the lien on shares provisions of the Articles. Our lien, if any, on a share shall extend to all distributions payable on it.

 

*Unclaimed Dividend*

Any dividend that remains unclaimed after a period of six years from the date of declaration of such dividend shall be forfeited and revert to the Company.

 

*Forfeiture or Surrender of Shares*

If a shareholder fails to pay any call or instalment of a call in respect of shares on the day appointed for payment, the directors may serve a notice on such shareholder naming a further date not earlier than the expiration of 14 days from the date of service on or before which the payment required by the notice is to be made and containing a statement that in the event of non-payment the shares, or any of them, will be liable to be forfeited.

If the requirements of such notice are not complied with, we may forfeit the shares together with any distributions declared payable in respect of the forfeited shares and not paid at any time before tender of payment.

A forfeited share may be sold or otherwise disposed of on such terms and in such manner as the directors think fit, and at any time before a sale or disposition the forfeiture may be cancelled on such terms as the directors think fit. The proceeds of any sale or disposition of the forfeited Share may be received and used by us as the directors determine.

A person whose shares have been forfeited shall cease to be a shareholder in respect of the forfeited shares, but shall, notwithstanding such forfeit, 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 interest.

 

*Share Premium Account*

The directors shall establish a share premium account and shall carry the credit of such account from time to time to a sum 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 Islands Companies Act.

 

 

*Redemption and Purchase of Own Shares*

Subject to the Cayman Islands Companies Act and to the rights attaching to any class of shares, we may by our directors:

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

&nbsp;&nbsp;&nbsp;&nbsp;(b) purchase
 our own shares (including any redeemable shares) on such terms and in such manner as the
 directors determine;

&nbsp;&nbsp;&nbsp;&nbsp;(c) make
 a payment in respect of the redemption or purchase of its own Shares in any manner permitted
 by the Companies Act including out of capital; and

&nbsp;&nbsp;&nbsp;&nbsp;(d) permit
 the surrender of fully paid Shares for no consideration.

When making payments in respect of redemption or purchase of shares, the directors may make such payments in cash or in kind if so authorized by the terms of issue of those shares or with the agreement of the holder of those shares.

 

*Transfer of Shares*

The transferor shall be deemed to remain the holder of an ordinary share until the name of the transferee is entered on the register of members of the Company.

Where the shares in question are not listed on or subject to the rules of Nasdaq, shares are transferable, subject to the consent of our board of directors who may, in their absolute discretion, refuse to consent to any transfer and decline to register the transfer without giving any reason.

If our directors refuse to register a transfer of a share, they are required, within two months after the date on which the transfer was lodged, to notify the transferee of the refusal.

 

*Inspection of Books and Records*

Holders of our Ordinary Shares will have no general right under the Cayman Islands Companies Act to inspect or obtain copies of our register of members or our corporate records. Under Cayman Islands law, the names of our current directors can generally be obtained from a search conducted at the Registrar of Companies of the Cayman Islands.

 

*General Meetings*

All general meetings other than annual general meetings shall be called extraordinary general meetings. We may but are not obliged to hold an annual general meeting.

Any director may convene general meetings at such times and in such manner and places within or outside the Cayman Islands as the director considers necessary or desirable. General meetings shall also be convened by any one or more of our directors on the written request of shareholders entitled to exercise 10% or more of the voting rights in respect of the matter for which the meeting is requisitioned. Such written request must state the objects of the meeting and must be signed by the shareholders requisitioning the meeting. The written request must be lodged at our registered office in the Cayman Islands and may be delivered in counterpart. If the directors do not proceed to convene a general meeting within 21 days of the written request to requisition a meeting being lodged the requisitionists, or any of them together holding at least half of the voting rights of all of them, may convene the general meeting in the same manner as nearly as possible as that in which a general meeting may be convened by a director. Where the requisitionists fail to convene the general meeting within three months of their right to convene the meeting arising, the right to convene the general meeting shall lapse.

The director convening a general meeting shall give not less than seven days' notice of a general meeting to those shareholders whose names on the date the notice is given appear as members in our register of members and are entitled to vote at the meeting. Such director shall also give such notice to each of the directors.

A general meeting held in contravention of the requirement to give notice is valid if shareholders holding at least 90% of the total voting rights on all the matters to be considered at the meeting have waived notice of the meeting and, for this purpose, the presence of a shareholder at the meeting shall constitute waiver in relation to all the shares which that shareholder holds.

A general meeting is duly constituted if, at the commencement of the meeting, there are present in person, through their authorized representative or by proxy not less than 30% of the votes of shares entitled to vote on resolutions of shareholders to be considered at the meeting. Where a quorum comprises a single shareholder or proxy, such person may pass a resolution of shareholders and a certificate signed by such person accompanied where such person be a proxy by a copy of the proxy instrument shall constitute a valid resolution of shareholders.

If, within two hours from the time appointed for the general meeting, a quorum is not present, the meeting, if convened upon the requisition of shareholders, shall be dissolved. In any other case it shall stand adjourned to the next business day in the jurisdiction in which the meeting was to have been held at the same time and place or to such other time and place as the directors may determine, and if at the adjourned meeting a quorum is not present within half an hour from the time appointed for the meeting the shareholders present shall be a quorum.

The chairman may, with the consent of the meeting at which a quorum is present, adjourn any meeting from time to time, and from place to place, but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.

At any general meeting the chairman is responsible for deciding in such manner as considered appropriate whether any resolution proposed has been carried or not and the result of the decision shall be announced to the meeting and recorded in the minutes of the meeting. If the chairman has any doubt as to the outcome of the vote on a proposed resolution, he shall cause a poll to be taken of all votes cast upon such resolution and the result shall be announced to the meeting and recorded in the minutes of the meeting. The minutes of the meeting shall be conclusive evidence of the fact that a resolution was carried or not without proof of the number or proportion of the votes recorded in favor of or against such resolution.

 

*Preferred Shares*

Pursuant to our amended and restated memorandum and articles of association, our directors have the authority to issue shares and other securities of the Company with such preferred, deferred or other special rights, restrictions or privileges whether with regard to voting, distributions, a return of capital, or otherwise and in such classes and series, if any, as the directors may determine. We do not currently have plans to issue any preferred shares.

 

*Directors*

We may by ordinary resolution impose a maximum or minimum number of directors required to hold office at any time and vary such limits from time to time. Under the Articles, we are required to have a minimum of one director.

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.

The directors shall be entitled to such remuneration as the directors may determine.

We may in general meeting fix a minimum shareholding required to be held by a director, but unless and until so fixed a director is not required to hold shares.

A director may be removed by ordinary resolution or by a resolution of our directors.

Subject to the provisions of the articles, the office of a director shall be vacated if:

&nbsp;&nbsp;&nbsp;&nbsp;(a) he
 gives notice in writing to the Company that he resigns the office of director; or

&nbsp;&nbsp;&nbsp;&nbsp;(b) he
 absents himself (without being represented by an alternate director appointed by him) from
 three consecutive meetings of the board of directors without special leave of absence from
 the directors, and they pass a resolution that he has by reason of such absence vacated office;
 or;

&nbsp;&nbsp;&nbsp;&nbsp;(c) he
 dies, becomes bankrupt or makes any arrangement or composition with his creditors generally;

&nbsp;&nbsp;&nbsp;&nbsp;(d) he
 is found to be or becomes of unsound mind; or

&nbsp;&nbsp;&nbsp;&nbsp;(e) all
 the other directors (being not less than two in number) resolve that he should be removed
 as a director;

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 the Nasdaq corporate governance rules. The audit committee shall consist of at least three directors, all of whom shall be independent within the meaning of the Nasdaq corporate governance rules and will meet the criteria for independence set forth in Rule 10A-3 or Rule 10C-1 of the Exchange Act.

 

*Powers and Duties of Directors*

Subject to the provisions of the Cayman Islands Companies Act and our amended and restated memorandum and articles and any directions given by ordinary resolution, our business and affairs shall be managed by, or under the direction or supervision of, the directors. The directors shall have all the powers necessary for managing, and for directing and supervising, our business and affairs of the Company as are not by the Cayman Islands Companies Act, our amended and restated memorandum and articles or the terms of any special resolution required to be exercised by the shareholders. No alteration of our amended and restated memorandum and articles or any direction given by ordinary or special resolution shall invalidate any prior act of the directors that was valid at the time undertaken.

The directors may delegate any of their powers to any committee consisting of one or more directors. They may also delegate to any managing director or director holding any other executive office such of their powers as they consider desirable to be exercised by him provided that an alternate director may not act as managing director and the appointment of a managing director shall automatically terminate if he ceases to be a director. Any such delegation may be made subject to any conditions the directors may impose and may be revoked or altered. Subject to any such conditions, the proceedings of a committee of directors shall be governed by the Articles regulating the proceedings of directors, so far as they are capable of applying.

The directors may establish any committees, local boards or agencies or appoint any person to be a manager or agent for managing the affairs of the Company and may appoint any person to be a member of such committees or local boards. Any such appointment may be made subject to any conditions the directors may impose, and may be revoked or altered. Subject to any such conditions, the proceedings of any such committee, local board or agency shall be governed by the Articles regulating the proceedings of directors, so far as they are capable of applying.

The directors may by power of attorney or otherwise appoint any company, firm, person or body of persons, whether nominated directly or indirectly by the directors, to be the attorney or authorized signatory of the Company for such purpose and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the directors under the Articles) and for such period and subject to such conditions as they may think fit, and any such powers of attorney or other appointment may contain such provisions for the protection and convenience of persons dealing with any such attorneys or authorized signatories as the directors may think fit and may also authorize any such attorney or authorized signatory to delegate all or any of the powers, authorities and discretions vested in him.

The directors may appoint such officers as they consider necessary on such terms, at such remuneration and to perform such duties, and subject to such provisions as to disqualification and removal as the directors may think fit. Unless otherwise specified in the terms of his appointment an officer may be removed by the directors.

The directors may exercise all the powers of the Company to incur indebtedness, liabilities or obligations and to issue debentures, debenture stock, mortgages, bonds and other such securities and to secure indebtedness, liabilities or obligations whether of the Company or of any third party.

No person shall be disqualified from the office of director or alternate director or prevented by such office from contracting with the Company, either as vendor, purchaser or otherwise, nor shall any such contract or any other contract or transaction entered into by or on behalf of the Company in which any director or alternate director shall be in anyway interested be or be liable to be avoided, nor shall any director or alternate director so contracting or being so interested be liable to account to the Company for any profit realized by any such contract or transaction by reason of such director holding office or of the fiduciary relation thereby established. A director (or his alternate director in his absence) shall be at liberty to vote in respect of any contract or transaction in which he is interested provided that the nature of the interest of any director or alternate director in any such contract or transaction shall be disclosed by him at or prior to its consideration and any vote thereon. A general notice that a director or alternate director is a shareholder, director, officer or employee of any specified firm or company and is to be regarded as interested in any transaction with such firm or company shall be sufficient disclosure for the purposes of voting on a resolution in respect of a contract or transaction in which he has an interest, and after such general notice it shall not be necessary to give special notice relating to any particular transaction.

 

 

*Capitalization of Profits*

The directors may capitalize any sum standing to the credit of any of the Company's reserve accounts (including share premium account and capital redemption reserve) or to the credit of profit and loss account or otherwise available for distribution and appropriate such sum to shareholders in the proportions in which such sum would have been divisible amongst them had the same been a distribution of profits by way of dividend and apply such sum on their behalf in paying up in full unissued shares for issue, allotment and distribution credited as fully paid-up to and amongst them in the proportions aforesaid. In such event the directors may make such provisions as they think fit in the case of shares becoming distributable in fractions.

 

*Liquidation Rights*

The shareholders may, subject to the Articles and any other sanction required by the Cayman Islands Companies Act, pass a special resolution allowing the Company to be wound up voluntarily. If the Company shall be wound up, and the assets available for distribution amongst the shareholders shall be insufficient to repay the whole of the share capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the shareholders in proportion to the par value of the shares held by them. If in a winding up the assets available for distribution amongst the shareholders shall be more than sufficient to repay the whole of the share capital at the commencement of the winding up, the surplus shall be distributed amongst the shareholders in proportion to the par value of the shares held by them at the commencement of the winding up subject to a deduction from those shares in respect of which there are monies due, of all monies payable to the Company for unpaid calls or otherwise, without prejudice to the rights of holders of shares issued upon special terms and conditions.

 

*Register of Members*

Under the Cayman Islands Companies Act, we must keep a register of members and there should be entered therein:

● the names and addresses of our shareholders, together with a statement of the shares held by each shareholder, such statement shall confirm (i) the amount paid or agreed to be considered as paid, on the shares of each shareholder; (ii) the number and category of shares held by each member, and (iii) whether each relevant category of shares held by a member carries voting rights under the articles of association of the company, 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 shareholder; and

● the date on which any person ceased to be a shareholder.

Under the Cayman Islands 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 Islands 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 Islands Companies Act is derived, to a large extent, from the older Companies Acts of the United Kingdom but does not follow recent United Kingdom statutory enactments, and accordingly there are significant differences between the Cayman Islands Companies Act and the current Companies Act of the United Kingdom. In addition, the Cayman Islands 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 Islands Companies Act applicable to us and the laws applicable to companies incorporated in the State of Delaware in the United States.

 

*Mergers and Similar Arrangements*

The Cayman Islands Companies Act permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies provided that the laws of the foreign jurisdiction permit such merger or consolidation. For these purposes, (1) "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 (2) 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 (1) a special resolution of the shareholders of each constituent company, and (2) such other authorization, if any, as may be specified in such constituent company's articles of association. The written plan of merger or consolidation must be filed with the Registrar of Companies of the Cayman Islands 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 members 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 affected in compliance with these statutory procedures.

A merger between a Cayman parent company and its Cayman 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, the Cayman Islands Companies Act contains statutory provisions that facilitate the reconstruction of companies by way of schemes of arrangement, provided that the arrangement is approved by (a) at least a majority in number of the creditors or class of creditors, who must, in addition, represent at least three-fourths in value of each such creditors or class of creditors; and/or (b) shareholders or a class of shareholders representing at least three-fourths in value of the shareholders or class of shareholders, in each case that are 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 (the "Grand Court"). While a dissenting shareholder has the right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement if it determines that:

&nbsp;&nbsp;&nbsp;&nbsp;(a) the
 statutory provisions as to the required majority vote have been met;

&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;(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;(d) the
 arrangement is not one that would more properly be sanctioned under some other provision
 of the Cayman Islands Companies Act.

The Cayman Islands Companies Act also contains a statutory power of compulsory acquisition which may facilitate the "squeeze out" of dissentient minority shareholders upon a tender offer. When a tender offer is made and accepted by holders of 90.0% 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, 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.

 

*Shareholders' Suits and Protection of Minority Shareholders.*

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 Grand Court can be expected to follow and apply the common law principles (namely the rule derived from the seminal English case of *Foss v. Harbottle* and the exceptions thereto, which limits the circumstances in which a shareholder may bring a derivative action on behalf of the company or a personal action to claim loss which is reflective of loss suffered by the company) which permit a minority shareholder to commence a class action against, or derivative actions in the name of, a company to challenge the following acts in the following circumstances:

● a company acts or proposes to act illegally or ultra vires;

● the act complained of, although not ultra vires, could only be effected duly if authorized by more than a simple majority vote that has not been obtained; and

● those who control the company are perpetrating a "fraud on the minority."

In the case of a company (not being a bank) having its share capital divided into shares, the Grand Court may, on the application of members holding not less than one fifth of the shares of the company in issue, appoint an inspector to examine the affairs of the company and to report thereon in such manner as the Grand Court shall direct.

Any of our shareholders may petition the Grand Court which may make a winding up order if the Grand Court of the Cayman Islands is of the opinion that it is just and equitable that we should be wound up and cease doing business. Alternatively, the Grand Court may make an order: (1) regulating the conduct of our affairs; (2) requiring us to refrain from doing or continuing an act complained of by the shareholder petitioner or to do an act which the shareholder petitioner has complained we have omitted to do; (3) authorizing civil proceedings to be brought in our name and on our behalf by the shareholder petitioner on such terms as the Grand Court may direct; or (4) providing for the purchase of the shares of any of our shareholders by other shareholders or us and, in the case of a purchase by us, a reduction of our capital accordingly.

Generally, claims against us must be based on the general laws of contract or tort applicable in the Cayman Islands or individual rights as shareholders as established by our amended and restated memorandum and articles of association.

 

 

*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 the consequences of committing a crime, or against the indemnified person's own fraud or dishonesty. Our amended and restated memorandum and articles of association permit indemnification of officers and directors for liabilities incurred in their capacities as such as a result of any act or failure to act unless such losses or damages arise from their own actual fraud or willful default. This standard of conduct is generally the same as permitted under the Delaware General Corporation Law for a Delaware corporation.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

 

*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 acts in a manner he reasonably believes to be in the best interests of the corporation. He must not use his corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best interest 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, the 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, directors of a Cayman Islands company owe fiduciary duties to the company. Under Cayman Islands law, directors and officers owe the following fiduciary duties: (i) a duty to act in good faith in what the director or officer believes to be in the best interests of the company as a whole; (ii) a duty to exercise powers for the purposes for which those powers were conferred and not for a collateral purpose; (iii) a duty not to improperly fetter the exercise of future discretion; (iv) a duty to exercise powers fairly as between different classes of shareholders; (v) a duty to exercise independent judgment; and (vi) a duty not to put themselves in a position in which there is a conflict between their duty to the company and their personal interests. In fulfilling their duty of care to our company, our directors must ensure compliance with our amended and restated memorandum and articles of association, as amended and restated from time to time.

A director of a Cayman Islands company owes to the company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge and experience. However, there are indications that English and Commonwealth courts are moving towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands.

 

*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 Islands 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 articles provide that general meetings may also be convened by any one or more of our directors on the written request of shareholders entitled to exercise 10% or more of the voting rights in respect of the matter for which the meeting is requisitioned. Such written request must state the objects of the meeting and must be signed by the shareholders requisitioning the meeting. The written request must be lodged at our registered office in the Cayman Islands and may be delivered in counterpart. If the directors do not proceed to convene a general meeting within 21 days of the written request to requisition a meeting being lodged the requisitionists, or any of them together holding at least half of the voting rights of all of them, may convene the general meeting in the same manner as nearly as possible as that in which a general meeting may be convened by a director. Where the requisitionists fail to convene the general meeting within three months of their right to convene the meeting arising, the right to convene the general meeting shall lapse. As a Cayman Islands exempted company, we are not obligated by law to call shareholders' annual general meetings.

 

*Cumulative Voting*

Under the Delaware General Corporation Law, cumulative voting for election 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 Islands Companies Act, our 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.

 

*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 articles (which include the removal of a director by ordinary resolution), the office of a director may be vacated if: (a) he gives notice in writing to the Company that he resigns the office of director; or (b) he absents himself (without being represented by an alternate director appointed by him) from three consecutive meetings of the board of directors without special leave of absence from the directors, and they pass a resolution that he has by reason of such absence vacated office; or; (c) dies, becomes bankrupt or makes any arrangement or composition with his creditors generally; (d) he is found to be or becomes of unsound mind; or; (e) the other directors (being not less than two in number) resolve that he should be removed as a director.

 

*Transactions with Interested Shareholders*

The Delaware General Corporation Law contains a business combination statute applicable to Delaware 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 Companies Act 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 Islands 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.

 

 

*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 Islands Companies Act and our articles, the Company may be wound up by a special resolution of our shareholders, or if the winding up is initiated by our board of directors, by either a special resolution of our members 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.

 

*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 Islands Companies Act and our 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 either with the consent in writing of the holders of not less than two-thirds of the issued shares of that class, or 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.

 

*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 Islands Companies Act, our articles may only be amended by special resolution of our shareholders.

**C. Material contracts**

We have not entered into any material contracts other than in the ordinary course of business and otherwise described elsewhere in this annual report.

**D. Exchange controls**

The Cayman Islands and Hong Kong currently have no exchange control regulations or currency restrictions.

Under existing PRC foreign exchange regulations, payment of current account items, such as profit distributions and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval from the SAFE, by complying with certain procedural requirements. Therefore, our PRC subsidiaries are able to pay dividends in foreign currencies to us without prior approval from SAFE, subject to the condition that the remittance of such dividends outside of the PRC complies with certain procedures under PRC foreign exchange regulations, such as the overseas investment registrations by our shareholders or the ultimate shareholders of our corporate shareholders who are PRC residents. Approval from, or registration with, appropriate government authorities is, however, required where the RMB is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. The PRC government may also at its discretion restrict access in the future to foreign currencies for current account transactions. Current PRC regulations permit our PRC subsidiaries to pay dividends to the Company only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. As of the date of this annual report, there are no restrictions or limitations imposed by the Hong Kong government on the transfer of capital within, into and out of Hong Kong (including funds from Hong Kong to the PRC), except for transfer of funds involving money laundering and criminal activities. Cayman Islands law prescribes that a company may only pay dividends out of its profits. Other than that, there are no restrictions on our ability to transfer cash to investors. See "Item 3 - Transfers of Cash to and from Our Subsidiaries" and "Item 3.D. Risk Factors - Risks Relating to Doing Business in China."

**E. Taxation**

***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 us 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 and 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.

***People's Republic of China Taxation***

Under the EIT Law and its implementation rules, an enterprise established outside of the PRC with a "de facto management body" within the PRC is considered a resident enterprise and will be subject to the enterprise income tax at the rate of 25% on its global income. The implementation rules define the term "de facto management body" as the body that exercises full and substantial control over and overall management of the business, production, personnel, accounts and properties of an enterprise. In April 2009, the SAT issued the SAT Circular 82, which provides certain specific criteria for determining whether the "de facto management body" of a PRC-controlled enterprise that is incorporated offshore is located in China. Although this circular only applies to offshore enterprises controlled by PRC enterprises or PRC enterprise groups, not those controlled by PRC individuals or foreigners, the criteria set forth in the circular may reflect the State Administration of Taxation's general position on how the "de facto management body" test should be applied in determining the tax resident status of all offshore enterprises. According to the SAT Circular 82, an offshore incorporated enterprise controlled by a PRC enterprise or a PRC enterprise group will be regarded as a PRC tax resident by virtue of having its "de facto management body" in China only if all of the following conditions are met: (i) the primary location of the day-to-day operational management is in the PRC; (ii) decisions relating to the enterprise's financial and human resource matters are made or are subject to approval by organizations or personnel in the PRC; (iii) the enterprise's primary assets, accounting books and records, company seals, and board and shareholder resolutions are located or maintained in the PRC; and (iv) at least 50% of voting board members or senior executives habitually reside in the PRC.

We believe that Park Ha Cayman is not a PRC resident enterprise for PRC tax purposes. Park Ha Cayman is not controlled by a PRC enterprise or PRC enterprise group and we do not believe that Park Ha Cayman meets all of the conditions above. Park Ha Cayman is a company incorporated outside the PRC. As a holding company, its key assets are its ownership interests in its subsidiaries, and its key assets are located, and its records (including the resolutions of its Board of Directors and the resolutions of its shareholders) are maintained, outside the PRC. For the same reasons, we believe our other entities outside of China are not PRC resident enterprises either. However, the tax resident status of an enterprise is subject to determination by the PRC tax authorities and uncertainties remain with respect to the interpretation of the term "de facto management body." There can be no assurance that the PRC government will ultimately take a view that is consistent with ours.

If the PRC tax authorities determine that Park Ha Cayman is a PRC resident enterprise for enterprise income tax purposes, we may be required to withhold a 10% withholding tax from dividends we pay to our shareholders that are non-resident enterprises, including the holders of the Ordinary Shares. In addition, non-resident enterprise shareholders (including the ordinary shareholders) may be subject to a 10% PRC tax on gains realized on the sale or other disposition of Ordinary Shares, if such income is treated as sourced from within the PRC. It is unclear whether our non-PRC individual shareholders (including the ordinary shareholders) would be subject to any PRC tax on dividends or gains obtained by such non-PRC individual shareholders in the event we are determined to be a PRC resident enterprise. If any PRC tax were to apply to such dividends or gains, it would generally apply at a rate of 20% (and such PRC tax may be withheld at source in the case of dividends). Any PRC income tax liability may be reduced under applicable tax treaties. However, it is unclear whether non-PRC shareholders of Park Ha Cayman would in practice be able to obtain the benefits of any tax treaties between their country of tax residence and the PRC in the event that Park Ha Cayman is treated as a PRC resident enterprise.

Provided that our Cayman Islands holding company, Park Ha Cayman, is not deemed to be a PRC resident enterprise, holders of the Ordinary Shares and Ordinary Shares who are not PRC residents will not be subject to PRC income tax on dividends distributed by us or gains realized from the sale or other disposition of our shares or Ordinary Shares. However, under Circular 7 and Circular 37, where a non-resident enterprise conducts an "indirect transfer" by transferring taxable assets, including, in particular, equity interests in a PRC resident enterprise, indirectly by disposing of the equity interests of an overseas holding company, the non-resident enterprise, being the transferor, or the transferee, or the PRC entity which directly owns such taxable assets may report to the relevant tax authority such indirect transfer. Using a "substance over form" principle, the PRC tax authority may disregard the existence of the overseas holding company if it lacks a reasonable commercial purpose and was established for the purpose of reducing, avoiding or deferring PRC tax. As a result, gains derived from such indirect transfer may be subject to PRC enterprise income tax, and the transferee or other person who is obligated to pay for the transfer is obligated to withhold the applicable taxes, currently at a rate of 10% for the transfer of equity interests in a PRC resident enterprise. However, sales of shares and Ordinary Shares by investors through a public stock exchange where such shares or Ordinary Shares are acquired on a public stock exchange are currently exempt from these indirect transfer rules under Circular 7 and Circular 37. We and our non-PRC resident investors may be at risk of being required to file a return and being taxed under Circular 7 and Circular 37, and we may be required to expend valuable resources to comply with Circular 7 and Circular 37, or to establish that we should not be taxed under these circulars.

***United States Federal Income Tax Considerations***

**WE RECOMMEND POTENTIAL PURCHASERS OF OUR ORDINARY SHARES TO CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE PERSONAL TAX CONSEQUENCES OF THE TRANSACTION, WHICH MAY VARY.**

The following discussion is a summary of U.S. federal income tax considerations generally applicable to the ownership and disposition of the Ordinary Shares by a U.S. Holder (as defined below) that acquires the Ordinary Shares in any future offering and holds the Ordinary Shares as "capital assets" (generally, property held for investment) under the U.S. Internal Revenue Code of 1986, as amended, or the Code. This discussion is based upon existing U.S. federal tax law, which is subject to differing interpretations or change, possibly with retroactive effect. There can be no assurance that the U.S. Internal Revenue Service ("IRS") or a court will not take a contrary position. This discussion, moreover, does not address the U.S. federal estate, gift, Medicare, and alternative minimum tax considerations, or any state, local and non-U.S. tax considerations, relating to the ownership or disposition of the Ordinary Shares. The following summary does not address all aspects of U.S. federal income taxation that may be important to particular investors in light of their individual circumstances or to persons in special tax situations such as:

● banks and other financial institutions;

● insurance companies;

● pension plans;

● cooperatives;

● regulated investment companies;

● real estate investment trusts;

● broker-dealers;

● traders that elect to use a mark-to-market method of accounting;

● certain former U.S. citizens or long-term residents;

● tax-exempt entities (including private foundations);

● holders who acquire their Ordinary Shares pursuant to any employee share option or otherwise as compensation;

● investors that will hold their Ordinary Shares as part of a straddle, hedge, conversion, constructive sale or other integrated transaction for U.S. federal income tax purposes;

● investors that have a functional currency other than the U.S. dollar;

● persons holding their Ordinary Shares in connection with a trade or business conducted outside the United States;

● persons that actually or constructively own 10% or more of our stock (by vote or value); or

● partnerships or other entities taxable as partnerships for U.S. federal income tax purposes, or persons holding the Ordinary Shares through such entities, all of whom may be subject to tax rules that differ significantly from those discussed below.

*General*

For purposes of this discussion, a "U.S. Holder" is a beneficial owner of the ordinary that is, for U.S. federal income tax purposes:

● an individual who is a citizen or resident of the United States;

● a corporation (or other entity treated as a corporation for U.S. federal income tax purposes) created in or organized under the law of the United States or any state thereof or the District of Columbia;

● an estate the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or

● a trust (A) the administration of which is subject to the primary supervision of a U.S. court and which has one or more U.S. persons who have the authority to control all substantial decisions of the trust or (B) that has otherwise validly elected to be treated as a U.S. person under the Code.

If a partnership (or other entity treated as a partnership for U.S. federal income tax purposes) is a beneficial owner of the Ordinary Shares, the tax treatment of a partner in the partnership will generally depend upon the status of the partner and the activities of the partnership. Partnerships holding the Ordinary Shares and their partners are recommended to consult their tax advisors regarding an investment in the Ordinary Shares.

For U.S. federal income tax purposes, a U.S. Holder of Ordinary Shares will generally be treated as the beneficial owner of the underlying shares represented by the Ordinary Shares. The remainder of this discussion assumes that a U.S. Holder of the Ordinary Shares will be treated in this manner. Accordingly, deposits or withdrawals of Ordinary Shares for Ordinary Shares will generally not be subject to U.S. federal income tax.

*Passive Foreign Investment Company Considerations*

A non-U.S. corporation, such as our Company, will be a PFIC, for U.S. federal income tax purposes for any taxable year, if either (i) 75% or more of its gross income for such year consists of certain types of "passive" income or (ii) 50% or more of the value of its assets (generally determined on the basis of a quarterly average) during such year is attributable to assets that produce or are held for the production of passive income. For this purpose, cash and assets readily convertible into cash are generally categorized as a passive asset and the company's goodwill and other unbooked intangibles are taken into account. Passive income generally includes, among other things, dividends, interest, rents, royalties, and gains from the disposition of passive assets. We will be treated as owning a proportionate share of the assets and earning a proportionate share of the income of any other corporation in which we own, directly or indirectly, 25% or more (by value) of the stock.

After the restructure that was completed in July 2023, our PRC subsidiaries are now an indirect subsidiary of the Company. Based upon our current and projected income and assets and projections as to the value of our assets, we do not expect to be a PFIC for the current taxable year or the foreseeable future. However, no assurance can be given in this regard because the determination of whether we are or will become a PFIC is a factual determination made annually that will depend, in part, upon the composition of our income and assets. Fluctuations in the market price of the Ordinary Shares may cause us to be or become a PFIC for the current or future taxable years because the value of our assets for purposes of the asset test, including the value of our goodwill and unbooked intangibles, may be determined by reference to the market price of the Ordinary Shares from time to time (which may be volatile). Among other matters, if our market capitalization is less than anticipated or subsequently declines, we may be or become a PFIC for the current or future taxable years. The composition of our income and assets may also be affected by how, and how quickly, we use our liquid assets and the cash raised in any future offering. Under circumstances where our revenue from activities that produce passive income significantly increases relative to our revenue from activities that produce non-passive income, or where we determine not to deploy significant amounts of cash for active purposes, our risk of being or becoming a PFIC may substantially increase. Because there are uncertainties in the application of the relevant rules, and because our PFIC status is an annual factual determination, there can be no assurance that we will not be a PFIC for the current taxable year or any future taxable year.

If we are a PFIC for any year during which a U.S. Holder holds the Ordinary Shares, we generally will continue to be treated as a PFIC for all succeeding years during which such U.S. Holder holds the Ordinary Shares.

The discussion below under "Dividends" and "Sale or Other Disposition" is written on the basis that we will not be or become a PFIC for U.S. federal income tax purposes. The U.S. federal income tax rules that apply generally if we are treated as a PFIC are discussed below under "Passive Foreign Investment Company Rules."

*Dividends*

Any cash distributions paid on the Ordinary Shares (including the amount of any PRC tax withheld) out of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles, will generally be includible in the gross income of a U.S. Holder as dividend income on the day actually or constructively received by the U.S. Holder, in the case of Ordinary Shares, in the case of Ordinary Shares. Because we do not intend to determine our earnings and profits on the basis of U.S. federal income tax principles, any distribution we pay will generally be treated as a "dividend" for U.S. federal income tax purposes. Dividends received on the Ordinary Shares will not be eligible for the dividends-received deduction allowed to corporations in respect of dividends received from U.S. corporations.

Individuals and other non-corporate U.S. Holders will be subject to tax at the lower capital gain tax rate applicable to "qualified dividend income"; provided that certain conditions are satisfied, including that (1) the Ordinary Shares on which the dividends are paid are readily tradable on an established securities market in the United States, or, in the event that we are deemed to be a PRC resident enterprise under the PRC tax law, we are eligible for the benefit of the United States-PRC income tax treaty (the "Treaty"), (2) we are neither a PFIC nor treated as such with respect to a U.S. Holder (as discussed below) for the taxable year in which the dividend is paid and the preceding taxable year, and (3) certain holding period and other requirements are met. There can be no assurance that the Ordinary Shares will continue to be considered readily tradable on an established securities market in later years. Because the Ordinary Shares will not be listed on a U.S. exchange, we do not believe that dividends received with respect to Ordinary Shares that are not represented by Ordinary Shares will be treated as qualified dividends. Non-corporate U.S. Holders are recommended to consult their tax advisors regarding the availability of the lower rate for dividends paid with respect to the Ordinary Shares.

In the event that we are deemed to be a PRC resident enterprise under the EIT Law, we may be eligible for the benefits of the Treaty. If we are eligible for such benefits, dividends we pay on our Ordinary Shares, regardless of whether such shares are represented by the Ordinary Shares, and regardless of whether the Ordinary Shares are readily tradable on an established securities market in the United States, would be eligible for the reduced rates of taxation described in the preceding paragraph, provided that certain holding period and other requirements are met and that we are neither a PFIC nor treated as such with respect to a U.S. Holder for the taxable year in which the dividend is paid and the preceding taxable year.

For U.S. foreign tax credit purposes, dividends paid on the Ordinary Shares generally will be treated as income from foreign sources and generally will constitute passive category income. In the event that we are deemed to be a PRC resident enterprise under the EIT Law, a U.S. Holder may be subject to PRC withholding taxes on dividends paid on the Ordinary Shares. Depending on the U.S. Holder's particular facts and circumstances and subject to a number of complex conditions and limitations, PRC withholding taxes on dividends that are non-refundable under the Treaty may be treated as foreign taxes eligible for credit against a U.S. Holder's U.S. federal income tax liability. A U.S. Holder who does not elect to claim a foreign tax credit for foreign tax withheld may instead claim a deduction for U.S. federal income tax purposes, in respect of such withholding, but only for a year in which such holder elects to do so for all creditable foreign income taxes. The rules governing the foreign tax credit are complex and U.S. Holders are recommended to consult their tax advisors regarding the availability of the foreign tax credit under their particular circumstances.

*Sale or Other Disposition*

A U.S. Holder will generally recognize gain or loss upon the sale or other disposition of Ordinary Shares in an amount equal to the difference between the amount realized upon the disposition and the holder's adjusted tax basis in such Ordinary Shares. The gain or loss will generally be capital gain or loss. Any capital gain or loss will be long term if the Ordinary Shares have been held for more than one year. The deductibility of a capital loss may be subject to limitations. Any such gain or loss that the U.S. Holder recognizes will generally be treated as U.S. source income or loss for foreign tax credit limitation purposes, which may limit the availability of foreign tax credits. However, in the event we are deemed to be a PRC resident enterprise under the EIT Law and PRC tax were to be imposed on any gain from the disposition of the Ordinary Shares, a U.S. Holder that is eligible for the benefits of the Treaty may elect to treat such gain as PRC source income. If a U.S. Holder is not eligible for the benefits of the Treaty or fails to make the election to treat any gain as foreign source, then such U.S. Holder may not be able to use the foreign tax credit arising from any PRC tax imposed on the disposition of the Ordinary Shares unless such credit can be applied (subject to applicable limitations) against United States federal income tax due on other income derived from foreign sources in the same income category (generally, the passive category). Each U.S. Holder is advised to consult its tax advisor regarding the tax consequences if a foreign tax is imposed on a disposition of the Ordinary Shares, including the availability of the foreign tax credit under its particular circumstances.

*Passive Foreign Investment Company Rules*

If we are a PFIC for any taxable year during which a U.S. Holder holds the Ordinary Shares, and unless the U.S. Holder makes a mark-to-market election (as described below), the U.S. Holder will generally be subject to special tax rules on (i) any excess distribution that we make to the U.S. Holder (which generally means any distribution paid during a taxable year to a U.S. Holder that is greater than 125 percent of the average annual distributions paid in the three preceding taxable years or, if shorter, the U.S. Holder's holding period for the Ordinary Shares), and (ii) any gain realized on the sale or other disposition including, under certain circumstances, a pledge, of Ordinary Shares. Under the PFIC rules:

● the excess distribution or gain will be allocated ratably over the U.S. Holder's holding period for the Ordinary Shares;

● the amount allocated to the current taxable year and any taxable years in the U.S. Holder's holding period prior to the first taxable year in which we are a PFIC (each, a "pre-PFIC year") will be taxable as ordinary income; and

● the amount allocated to each prior taxable year, other than a pre-PFIC year, will be subject to tax at the highest tax rate in effect for individuals or corporations, as appropriate, for that year, increased by an additional tax equal to the interest on the resulting tax deemed deferred with respect to each such taxable year.

If we are a PFIC for any taxable year during which a U.S. Holder holds the Ordinary Shares, and any of our subsidiaries is also a PFIC (a "lower-tier PFIC"), such U.S. Holder would be treated as owning a proportionate amount (by value) of the shares of the lower-tier PFIC for purposes of the application of these rules. U.S. Holders are recommended to consult their tax advisors regarding the application of the PFIC rules to any of our subsidiaries.

As an alternative to the foregoing rules, a U.S. Holder of "marketable stock" (as defined below) in a PFIC may make a mark-to-market election with respect to such stock. If a U.S. Holder makes this election with respect to the Ordinary Shares, the holder will generally (i) include as ordinary income for each taxable year that we are a PFIC the excess, if any, of the fair market value of Ordinary Shares held at the end of the taxable year over the adjusted tax basis of such Ordinary Shares and (ii) deduct as an ordinary loss the excess, if any, of the adjusted tax basis of the Ordinary Shares over the fair market value of such Ordinary Shares held at the end of the taxable year, but such deduction will only be allowed to the extent of the amount previously included in income as a result of the mark-to-market election. The U.S. Holder's adjusted tax basis in the Ordinary Shares would be adjusted to reflect any income or loss resulting from the mark-to-market election. If a U.S. Holder makes a mark-to-market election in respect of the Ordinary Shares and we cease to be a PFIC, the holder will not be required to take into account the gain or loss described above during any period that we are not a PFIC. If a U.S. Holder makes a mark-to-market election, any gain such U.S. Holder recognizes upon the sale or other disposition of the Ordinary Shares in a year when we are a PFIC will be treated as ordinary income and any loss will be treated as ordinary loss, but such loss will only be treated as ordinary loss to the extent of the net amount previously included in income as a result of the mark-to-market election.

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 United States Treasury regulations. We anticipate that the Ordinary Shares should qualify as being regularly traded, but no assurances may be given in this regard.

Because a mark-to-market election cannot technically be made for any lower-tier PFICs that we may own, a U.S. Holder may continue to be subject to the PFIC rules with respect to such U.S. Holder's indirect interest in any investments held by us that are treated as an equity interest in a PFIC for U.S. federal income tax purposes.

We do not intend to provide information necessary for U.S. Holders to make qualified electing fund elections which, if available, would result in tax treatment different from (and generally less adverse than) the general tax treatment for PFICs described above.

If a U.S. Holder owns the Ordinary Shares during any taxable year that we are a PFIC, the holder must generally file an annual IRS Form 8621. You should consult your tax advisor regarding the U.S. federal income tax consequences of owning and disposing of the Ordinary Shares if we are or become a PFIC.

**F. Dividends and paying agents**

Not applicable.

**G. Statement by experts**

Not applicable.

**H. Documents on display**

We are subject to the information requirements of the Exchange Act. In accordance with these requirements, the Company files reports and other information with the SEC. You may read and copy any materials filed with the SEC at the Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. You may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC also maintains a web site at http://www.sec.gov that contains reports and other information regarding registrants that file electronically with the SEC.

**I. Subsidiary Information**

See Exhibit 8.1 for our list of subsidiaries.

**J. Annual Report to Security Holders**

Not applicable.

**ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK**

Financial instruments that potentially subject the Company to concentration of credit risk are cash, and accounts receivable arising from its normal business activities. The Company places its cash in what it believes to be credit-worthy financial institutions or trading platforms.

The Company conducts credit evaluations of customers, and generally does not require collateral or other security from its customers. The Company establishes an allowance for expected credit losses primarily based upon the factors surrounding the credit risk of specific customers.

Foreign currency exchange rate risk

The functional currency and the reporting currency of the Company are RMB and U.S. dollars, respectively. The Company's exposure to foreign currency exchange rate risk primarily relates to cash, accounts receivable and accounts payable. Any significant fluctuation of RMB against U.S. dollars may materially and adversely affect the Company's cash flows, revenues, earnings and financial positions.

**ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES**

**A. Debt Securities**

Not applicable.

**B. Warrants and Rights**

Not applicable.

**C. Other Securities**

Not applicable.

**D. American Depositary Shares**

Not applicable.

**PART II**

**ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES**

None.

**ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITIES HOLDERS AND USE OF PROCEEDS**

There have been no material modifications to the rights of our security holders.

**ITEM 15. CONTROLS AND PROCEDURES**

**Disclosure Controls and Procedures**

Our management, with the participation of our chief executive officer and chief financial officer, 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, due to the material weaknesses described below, as of October 31, 2025, our disclosure controls and procedures were not effective. Our conclusion is based on the fact that we do not have sufficient in-house personnel in our accounting department with sufficient knowledge of the U.S. GAAP and SEC reporting rules.

**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 Exchange Act Rule 13a-15(f). Our management, with the participation of our chief executive officer and our chief financial officer, evaluated the effectiveness of our internal control over financial reporting based on criteria established in the framework in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, our management has concluded that our internal control over financial reporting was not effective as of October 31, 2025. Our management identified the material weakness(es) in our internal control over financial reporting as insufficient in-house personnel in our accounting department with sufficient knowledge of the U.S. GAAP and SEC reporting rules.

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 because the degree of compliance with policies or procedures may deteriorate.

**Attestation Report of the Registered Public Accounting Firm**

This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm pursuant to the rules of the SEC.

**Changes in Internal Control over Financial Reporting**

There have been no changes in our internal controls over financial reporting that occurred during the fiscal year ended October 31, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**ITEM 16. [Reserved]**

**ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT**

Our Board of Directors has determined that Yanan Shan qualifies as an "audit committee financial expert", and is independent for the purposes of the Nasdaq Listing Rules and Rule 10A-3 under the Exchange Act.

**ITEM 16B. CODE BUSINESS OF ETHICS**

We have adopted a Code of Business Conduct and Ethics that applies to our directors, officers, and employees. A copy of the Code of Business Conduct and Ethics is attached as an exhibit to this annual report. The Code of Business Conduct and Ethics is publicly available on our website at http://ir.parkha.cn/.

**ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES**

The following table sets forth the aggregate fees by categories specified below in connection with certain professional services rendered and billed by WWC, P.C., our independent registered public accounting firm, for the years indicated.

---

| | | |
|:---|:---|:---|
|  | **For the Fiscal Years Ended <br> October 31,** | **For the Fiscal Years Ended <br> October 31,** |
|  | **2025** | **2024** |
|  | **USD** | **USD** |
| Audit Fees<sup>(1)</sup> | 180000 | 373892 |
| Audit-Related Fees<sup>(2)</sup> | 16000 |  |
| Tax fees |  |  |
| Other Fees<sup>(3)</sup> |  |  |
| **Total** | 196000 | 373892 |

---

(1) Audit
 fees mean the aggregate fees billed for each of the fiscal years for professional services rendered
 by our auditor for the audit of our annual consolidated financial statements, review of the interim
 financial information and review of documents filed with the SEC.

(2) Audit-related fees mean
 the aggregate fees billed in each of the fiscal years for the assurance and related services rendered by our auditor, which were
 not included under audit fees above.

(3) Other fees mean the aggregate
 fees billed in each of the fiscal years for professional services rendered by our auditor for tax compliance, tax advice, tax planning
 and other services.

In accordance with the requirements of the U.S. Sarbanes-Oxley Act of 2002 and rules issued by the SEC, our audit committee reviews and pre-approves all audit services and permissible non-audit services provided to us that are performed by WWC, P.C., other than de minimis non-audit services which are approved by the audit committee prior to the completion of the audit.

**ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES**

Not applicable.

**ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS**

None.

**ITEM 16F. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT**

None.

**ITEM 16G. CORPORATE GOVERNANCE**

As a company listed on the Nasdaq Capital Market, we are subject to the Nasdaq 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.

As a company incorporated in the Cayman Islands that is listed on The Nasdaq Capital Market, the Pursuant to the home country rule exemption set forth under Nasdaq Listing Rule 5615(a)(3)(A), which provides (with certain exceptions not relevant to the conclusions expressed herein) that a foreign private issuer may follow its home country practice in lieu of the requirements of the Nasdaq Listing Rules 5600 Series, 5250(b)(3) and 5250(d), the Company elected to be exempt from Nasdaq Listing Rule 5635, which sets forth (A) the circumstances under which shareholder approval is required prior to an issuance of securities in connection with: (a) the acquisition of the stock or assets of another company, (b) equity-based compensation of officers, directors, employees or consultants, (c) a change of control, and (d) transactions other than public offerings; (B) general provisions relating to shareholder approval; and (C) the financial viability exception to the shareholder approval requirement.

**ITEM 16H. MINE SAFETY DISCLOSURE**

Not applicable.

**ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS**

Not applicable.

**ITEM 16J. INSIDER TRADING POLICIES**

We have adopted insider trading policies governing the purchase, sale, and other dispositions of our securities by directors, senior management, and employees. A copy of the insider trading policies is attached as an exhibit to this annual report.

**ITEM 16K. CYBERSECURITY**

Our Board of Directors plays an active role in monitoring cybersecurity risks and is committed to the prevention, timely detection, and mitigation of the effects of any such incidents on our operations. Any cybersecurity incidents are closely monitored for their potential impact on our business strategy, operations, and financial condition. As of the date of this annual report, we have not experienced any cybersecurity incidents that have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition. We continuously adapt our business strategy to enhance resilience, strengthen defenses and ensure the sustainability of our operations.

**PART III**

**ITEM 17. FINANCIAL STATEMENTS**

We have elected to provide financial statements pursuant to Item 18.

**ITEM 18. FINANCIAL STATEMENTS**

Our consolidated financial statements are included at the end of this annual report.

**ITEM 19. EXHIBITS**

---

| | |
|:---|:---|
| **Exhibit<br> Number** | **Description** |
| 1.1 | [Amended and restated Memorandum and Articles of Association, as currently in effect (incorporated herein by reference to Exhibit 3.1 to the Form 6-K filed with the SEC on February 10, 2026)](https://www.sec.gov/Archives/edgar/data/1986247/000121390026013869/ea027623701ex3-1_parkha.htm) |
| 2.1\* | [Description of Securities](ea027833401ex2-1.htm) |
| 2.2 | [Form of Warrant (incorporated herein by reference to Exhibit 4.1 to the Form 6-K filed with the SEC on January 28, 2026)](https://www.sec.gov/Archives/edgar/data/1986247/000121390026008823/ea027438601ex4-1_parkha.htm) |
| 2.3 | [Form of Securities Purchase Agreement (incorporated herein by reference to Exhibit 10.2 to the Form 6-K filed with the SEC on January 28, 2026)](https://www.sec.gov/Archives/edgar/data/1986247/000121390026008823/ea027438601ex10-2_parkha.htm) |
| 4.1 | [Employment Agreement between the Chief Executive Officer, Xiaoqiu Zhang, and the Company, dated July 8, 2024 (incorporated herein by reference to Exhibit 10.2 to the registration statement on Form F-1 (File No. 333-281783), as amended, initially filed with the SEC on August 26, 2024)](http://www.sec.gov/Archives/edgar/data/1986247/000121390024072589/ea020413805ex10-2_parkha.htm) |
| 4.2 | [Employment Agreement between the Chief Financial Officer, Xiaoyan Zhu, and the Company, dated July 8, 2024 (incorporated by reference to Exhibit 10.3 to the registration statement on Form F-1 (File No. 333-281783), as amended, initially filed with the SEC on August 26, 2024)](http://www.sec.gov/Archives/edgar/data/1986247/000121390024072589/ea020413805ex10-3_parkha.htm) |
| 4.3 | [Employment Agreement between the Chief Technology Officer, Xinyu Li, and the Company, dated July 8, 2024 (incorporated by reference to Exhibit 10.15 to the registration statement on Form F-1 (File No. 333-281783), as amended, initially filed with the SEC on August 26, 2024)](http://www.sec.gov/Archives/edgar/data/1986247/000121390024072589/ea020413805ex10-15_parkha.htm) |
| 4.4 | [Form of the Director Offer Letter by and between the Registrant and Independent Director (incorporated by reference to Exhibit 10.16 to the registration statement on Form F-1 (File No. 333-281783), as amended, initially filed with the SEC on August 26, 2024)](http://www.sec.gov/Archives/edgar/data/1986247/000121390024072589/ea020413805ex10-16_parkha.htm) |
| 4.5 | [Park Ha Cayman March 2025 Share Incentive Plan (incorporated by reference to the Form S-8 filed with the SEC on March 3, 2025)](http://www.sec.gov/Archives/edgar/data/1986247/000121390025019061/ea023262601ex10-1_parkha.htm) |
| 4.6 | [Park Ha Cayman July 2025 Share Incentive Plan (incorporated by reference to Form S-8 filed with the SEC on July 10, 2025)](http://www.sec.gov/Archives/edgar/data/1986247/000121390025062686/ea0248250-s8_parkha.htm) |
| 8.1\* | [List of Subsidiaries](ea027833401ex8-1.htm) |
| 11.1 | [Code of Business Conduct and Ethics (incorporated by reference to Exhibit 14.1 to the registration statement on Form F-1 (File No. 333-281783), as amended, initially filed with the SEC on August 26, 2024)](http://www.sec.gov/Archives/edgar/data/1986247/000121390024072589/ea020413805ex14-1_parkha.htm) |
| 11.2 | [Insider Trading Policies (incorporated by reference to Exhibit 14.2 to the registration statement on Form F-1 (File No. 333-281783), as amended, initially filed with the SEC on August 26, 2024)](http://www.sec.gov/Archives/edgar/data/1986247/000121390024072589/ea020413805ex14-2_parkha.htm) |
| 12.1\* | [Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ea027833401ex12-1.htm) |
| 12.2\* | [Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002](ea027833401ex12-2.htm) |
| 13.1\* | [Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ea027833401ex13-1.htm) |
| 13.2\* | [Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ea027833401ex13-2.htm) |
| 15.1\* | [Consent of WWC, P.C.](ea027833401ex15-1.htm) |
| 97.1 | [Executive Compensation Recovery Policy (incorporated by reference to Exhibit 14.2 to the registration statement on Form F-1 (File No. 333-281783), as amended, initially filed with the SEC on August 26, 2024)](http://www.sec.gov/Archives/edgar/data/1986247/000121390024072589/ea020413805ex14-2_parkha.htm) |
| 101.INS\* | Inline XBRL Instance 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 (embedded within the Inline XBRL document) |

---

\* Filed 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.

---

| | | |
|:---|:---|:---|
|  | **Park Ha Biological Technology Co., Ltd.** | **Park Ha Biological Technology Co., Ltd.** |
| Date: March 2, 2026 | By: | /s/ Xiaoqiu Zhang |
|  | Name: | Xiaoqiu Zhang |
|  | Title: | Chief Executive Officer and<br> Chairperson of the Board |

---

**PARK HA BIOLOGICAL TECHNOLOGY CO., LTD. AND SUBSIDIARIES**

**INDEX TO CONSOLIDATED FINANCIAL STATEMENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [Report of Independent Registered Public Accounting Firm (PCAOB ID No.1171)](#F_001) | F-2 |
| [Consolidated Balance Sheets as of October 31, 2025 and 2024](#F_002) | F-3 |
| [Consolidated Statements of Operations and Comprehensive Income for the Years Ended October 31, 2025, 2024 and 2023](#F_003) | F-4 |
| [Consolidated Statements of Changes in Shareholders' Equity for the Years Ended October 31, 2025, 2024 and 2023](#F_004) | F-5 |
| [Consolidated Statements of Cash Flows for the Years Ended October 31, 2025, 2024 and 2023](#F_005) | F-6 |
| [Notes to the Consolidated Financial Statements](#F_006) | F-7 |

---

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

![](ea027833401_img49.jpg)

To: The Board of Directors and Shareholders of <br> Park Ha Biological Technology Co., Ltd.

**Opinion on the Financial Statements**

We have audited the accompanying consolidated balance sheets of Park Ha Biological Technology Co., Ltd and its subsidiaries (collectively the "Company") as of October 31, 2025 and 2024, and the related consolidated statements of operations and comprehensive income, changes in shareholders' equity, and cash flows in each of the years in the three-year period ended October 31, 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 October 31, 2025 and 2024, and the results of its operations and its cash flows in each of the years in the three-year period ended October 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

**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 audit 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/ WWC, P.C. |
| WWC, P.C.<br> Certified Public Accountants<br> PCAOB ID: 1171 |

---

We have served as the Company's auditor since 2022.

San Mateo, California

March 02, 2026

![](ea027833401_img50.jpg)

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Consolidated Balance Sheets**

**As of October 31, 2025 and 2024**

---

| | | |
|:---|:---|:---|
|  | **October 31,<br> 2025** | **October 31, <br> 2024** |
| **ASSETS** | | |
| **Current assets** | | |
| Cash and cash equivalents | 3787678 | 547498 |
| Accounts receivables, net | 255844 | 330892 |
| Due from related parties | 35 | 14339 |
| Inventories, net | 75214 | 71486 |
| Advances to suppliers | 9384 | 19168 |
| Loans receivable from franchisees, net | 1021181 | 745992 |
| Other receivables and other current assets | 352626 | 1114871 |
| **Total current assets** | 5501962 | 2844246 |
| **Non-current Assets** |  |  |
| Property and equipment, net | 157999 | 103960 |
| Intangible assets, net | 6639 | 7621 |
| Operating lease right of use asset, net | 180243 | 70739 |
| Other non-current assets | 105773 | 56717 |
| **Total non-current assets** | 450654 | 239037 |
| **TOTAL ASSETS** | 5952616 | 3083283 |
| **<u>LIABILITIES AND SHAREHOLDERS' EQUITY</u>** |  |  |
| **Current liabilities** |  |  |
| Accounts payable | 12013 | 24069 |
| Due to related parties | 7026 |  |
| Taxes payable | 1375488 | 1001024 |
| Operating lease liabilities – current | 104254 | 17573 |
| Contract liability | 194753 | 325924 |
| Accruals and other payables | 188312 | 155863 |
| **Total current liabilities** | 1881846 | 1524453 |
| **Non-current liabilities** |  |  |
| Operating lease liabilities – non-current | 75915 | 52745 |
| **Total non-current assets** | 75915 | 52745 |
| **TOTAL LIABILITIES** | 1957761 | 1577198 |
| Commitments and contingencies |  |  |
| **Shareholders' equity** |  |  |
| Class A Ordinary Shares, $0.001 par value; 12,000,000,000 shares authorized; 296,488 and 119,000 shares issued and outstanding as of October 31, 2025 and 2024, respectively;\* | 296 | 119 |
| Class B Ordinary Shares, $0.001 par value; 3,000,000,000 shares authorized; 381,000 shares issued and outstanding as of October 31, 2025 and 2024, respectively\* | 381 | 381 |
| Subscription receivable |  |  |
| Additional paid in capital | 28021581 | 1161211 |
| Statutory reserve | 217264 | 131962 |
| (Accumulated deficits) Retained earning | (24178267) | 271788 |
| Accumulated other comprehensive loss | (66400) | (59376) |
| **Total Shareholders' equity** | 3994855 | 1506085 |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | 5952616 | 3083283 |

---

\* Retroactively restated to reflect the share split, reverse share split and share reorganization (See Note 15)

The accompanying notes are an integral part of these consolidated financial statements.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Consolidated Statements of Operations and Comprehensive Income**

**For the Years Ended October 31, 2025, 2024 and 2023**

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended <br> October 31, <br> 2025** | **Year Ended <br> October 31, <br> 2024** | **Year Ended <br> October 31, <br> 2023** |
| Revenues, net | 2524843 | 2381851 | 2459102 |
| Cost of revenues | 142526 | 195336 | 310989 |
| Gross profit | 2382317 | 2186515 | 2148113 |
| Operating expenses |  |  |  |
| Selling and marketing expenses | 625289 | 361327 | 299615 |
| General and administrative expenses | 25483541 | 814857 | 484955 |
| Research and development expenses | 238184 | 36714 | 30881 |
| Allowance for expected credit losses | 184204 | 179903 | 152108 |
| Total operating expenses | 26531218 | 1392801 | 967559 |
| Operating (loss) income | (24148901) | 793714 | 1180554 |
| Other income (expense): |  |  |  |
| &nbsp;&nbsp;&nbsp;Other income (expense) | 58738 | (1076) | (575) |
| &nbsp;&nbsp;&nbsp;Interest income | 6097 | 783 | 1590 |
| &nbsp;&nbsp;&nbsp;Interest expense | (41) |  |  |
| Total other income (expenses) | 64794 | (293) | 1015 |
| (Loss) income before income tax | (24084107) | 793421 | 1181569 |
| Income tax expenses (benefits) | 280646 | 314860 | 329527 |
| Net (loss) income | (24364753) | 478561 | 852042 |
| Other comprehensive income (loss): |  |  |  |
| Foreign currency translation adjustments | (7024) | 14551 | (28111) |
| Total comprehensive (loss) income | (24371777) | 493112 | 823931 |
| (Loss) earnings per share: |  |  |  |
| Ordinary shares – basic and diluted | (41.38) | 0.96 | 1.70 |
| Weighted average shares outstanding used in calculating basic and diluted earnings per share: |  |  |  |
| Ordinary shares – basic and diluted\* | 588866 | 500000 | 500000 |

---

\* Retroactively restated to reflect the share split, reverse share split and share reorganization (See Note 15)

The accompanying notes are an integral part of these consolidated financial statements.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Consolidated Statements of Changes in Shareholders' Equity**

**For the Years Ended October 31, 2025, 2024 and 2023**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Ordinary Shares\*** | **Ordinary Shares\*** | | | | | | |
|  | **Number of**<br>**Shares** |<br>**Amount** |<br>**Subscription**<br>**Receivable** |<br>**Additional**<br>**Paid-in**<br>**Capital** |<br>**Statutory**<br>**Reserve** | **Retained**<br>**earning**<br>**(Accumulated**<br>**Deficits)** | **Accumulated**<br>**Other**<br>**Comprehensive**<br>**loss** |<br>**Total**<br>**Equity** |
| Balance at October 31, 2022 | 500000 | 500 | （500） | 1122946 |  | (926853) | (45816) | 150277 |
| Contribution in capital |  |  |  | 38265 |  |  |  | 38265 |
| Net income |  |  |  |  |  | 852042 |  | 852042 |
| Appropriation to statutory reserve |  |  |  |  | 30422 | (30422) |  |  |
| Foreign currency translation adjustments |  |  |  |  |  |  | (28111) | (28111) |
| Balance at October 31, 2023 | 500000 | 500 | (500) | 1161211 | 30422 | (105233) | (73927) | 1012473 |
| Contribution in capital |  |  | 500 |  |  |  |  | 500 |
| Net income |  |  |  |  |  | 478561 |  | 478561 |
| Appropriation to statutory reserve |  |  |  |  | 101540 | (101540) |  |  |
| Foreign currency translation adjustments |  |  |  |  |  |  | 14551 | 14551 |
| Balance at October 31, 2024 | 500000 | 500 |  | 1161211 | 131962 | 271788 | (59376) | 1506085 |
| Issuance of shares, net | 27488 | 27 |  | 2790320 |  |  |  | 2790347 |
| Share-based Compensation | 150000 | 150 |  | 24070050 |  |  |  | 24070200 |
| Net loss |  |  |  |  |  | (24364753) |  | (24364753) |
| Appropriation to statutory reserve |  |  |  |  | 85302 | (85302) |  |  |
| Foreign currency translation adjustments |  |  |  |  |  |  | (7024) | (7024) |
| Balance at October 31, 2025 | 677488 | 677 |  | 28021581 | 217264 | (24178267) | (66400) | 3994855 |

---

\* Retroactively restated to reflect the share split, reverse share split and share reorganization (See Note 15)

The accompanying notes are an integral part of these consolidated financial statements.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Consolidated Statements of Cash Flows**

**For the Years Ended October 31, 2025, 2024 and 2023**

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended<br> October 31,<br> 2025** | **Year Ended<br> October 31,<br> 2024** | **Year Ended<br> October 31,<br> 2023** |
| Cash flows from operating activities |  |  |  |
| &nbsp;&nbsp;&nbsp;Net (loss) income | (24364753) | 478561 | 852042 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 109369 | 22686 | 20063 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for credit losses | 184204 | 179903 | 152108 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for Inventory | 12360 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory write-off | 1430 | 15955 | 1231 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax benefits | (26671) | (21465) | (33737) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-cash lease expenses | 37386 | 30425 | 45896 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based Compensation Expense | 24070200 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-cash operating expense | 153802 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | 71978 | (98740) | (337745) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | (17458) | 10472 | (2823) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advances to suppliers | 9653 | 76909 | 8959 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other receivables and other current assets | (324318) | (36862) | (265755) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating advance payments to related parties | (35) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current assets | (20323) | 9620 | 178016 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accruals and other payables | (1843) | 27450 | 35281 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | (11894) | (176130) | 69427 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Taxes payable | 369232 | 403396 | 437310 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Contract liability | (129424) | 68725 | (989082) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities | (37043) | (30435) | (44654) |
| Net cash provided by operating activities | 85852 | 960470 | 126537 |
| Cash flows from investing activities |  |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of equipment and intangible assets | (88825) | (85569) | (22676) |
| &nbsp;&nbsp;&nbsp;Loans to franchisees | (1103211) | (1236518) | (311083) |
| &nbsp;&nbsp;&nbsp;Loan repayment from franchisees | 604964 | 810660 | 1361609 |
| &nbsp;&nbsp;&nbsp;Loans to the third party | (6030001) |  |  |
| &nbsp;&nbsp;&nbsp;Loans repayment from the third party | 6030001 |  |  |
| &nbsp;&nbsp;&nbsp;Advance to related parties |  | (28256) | (20028) |
| &nbsp;&nbsp;&nbsp;Repayment from related parties | 14145 | 31540 | 15597 |
| Net cash (used in) provided by investing activities | (572927) | (508143) | 1023419 |
| Cash flows from financing activities |  |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from shareholder's contribution of capital |  | 500 | 38265 |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of shares | 4277807 |  |  |
| &nbsp;&nbsp;&nbsp;Borrowing from related parties | 6930 | 4175 | 60893 |
| &nbsp;&nbsp;&nbsp;Repayment to related parties |  | (73310) | (776083) |
| &nbsp;&nbsp;&nbsp;IPO Cost | (549060) | (888754) |  |
| Net cash provided by (used in) financing activities | 3735677 | (957389) | (676925) |
| Net increase (decrease) in cash | 3248602 | (505062) | 473031 |
| Effect of exchange rate changes on cash | (8422) | 18926 | (14108) |
| Cash and cash equivalents– at the beginning of the year | 547498 | 1033634 | 574711 |
| Cash and cash equivalents– at the end of the year | $3787678 | $547498 | $1033634 |
| Supplementary cash flow information: |  |  |  |
| &nbsp;&nbsp;&nbsp;Interest paid | $— | $— | $— |
| Non-cash investing and financing activities: |  |  |  |
| &nbsp;&nbsp;&nbsp;Noncash obtained leasehold improvements | 72862 |  |  |
| &nbsp;&nbsp;&nbsp;Operating lease right-of-use assets obtained in exchange for operating lease liabilities | $144863 | $65884 | $52731 |

---

The accompanying notes are an integral part of these consolidated financial statements.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 1 — ORGANIZATION AND BASIS OF PRESENTATION**

Park Ha Biological Technology Co., Ltd. ("Park Ha Cayman") was incorporated in the Cayman Islands on October 11, 2022. The Company is an investment holding company; its primary business operations are conducted through its subsidiaries and VIEs as described below.

Park Ha Biological Technology (HK) Co., Ltd. ("Park Ha HK") was incorporated in Hong Kong on October 25, 2022. It is a wholly owned subsidiary of Park Ha Cayman.

Park Ha Investment (Wuxi) Co., Ltd. ("Park Ha WFOE") was incorporated on May 5, 2023 as a wholly foreign owned entity in the People's Republic of China ("PRC"). Park Ha WFOE is a wholly owned subsidiary of Park Ha HK.

Wuxi Xinzhan Enterprise Management Consulting Co., Ltd. ("XinZhan") was incorporated on March 31, 2016 in the PRC with Ms. Xiaoqiu Zhang being the majority shareholder owning 75.2% of XinZhan prior to the equity transfer described below. XinZhan takes the lead in promoting the franchisee market and looking for franchisees. XinZhan signs a franchise agreement with the franchisee. The franchise agreement grants the franchisee the license to open stores under the "PARK HA" brand in a specific area. Franchisees authorized to sell Park Ha Jiangsu's "PARK HA" brand products or third-party products authorized by XinZhan must comply with the terms of the franchise agreement.

Shanghai Park Ha Industrial Development Co., Ltd. ("Park Ha Shanghai") was incorporated on April 17, 2017 in the PRC as a wholly owned subsidiary of Wuxi XinZhan. Park Ha Shanghai's primary business includes beauty services, sales of beauty products and devices.

Jiangsu Park Ha Biotechnology Co., Ltd. ("Park Ha Jiangsu") was incorporated on August 13, 2019 in the PRC with Ms. Xiaoqiu Zhang being the majority shareholder owning 75.2% of Park Ha Jiangsu prior to the equity transfer described below. Park Ha Jiangsu has developed a full range of "PARK HA" brand skin care products through cooperation with biological laboratories. Our product range ranges from basic skin physical protection, exfoliation, and sebum film repair to surface microecological balance and anti-aging. These products are sold through directly operated retail stores and franchisees.

On May 17, 2023, Park Ha WFOE entered into equity transfer agreements with each shareholder of Wuxi XinZhan and Park Ha Jiangsu to purchase all the equity interest in such entities. The restructure was completed on July 7, 2023. As a result, Wuxi XinZhan and Park Ha Jiangsu became a wholly owned subsidiary of Park Ha WFOE.

Upon the completion of the above Reorganization, Park Ha Cayman became the ultimate holding company of all other entities mentioned above. The Company is effectively controlled by the same group of controlling shareholders before and after the Reorganization; therefore, the Reorganization is considered as a recapitalization of these entities under common control. The consolidation of the Company was accounted for at historical cost and prepared on the basis as if the aforementioned transactions had become effective as of the beginning of the first period presented in the accompanying consolidated financial statements. Results of operations for the period presented comprise those of the previous separate entries combined from the beginning of the period to the end of the period, eliminating the effects of intra-entity transactions.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 1 — ORGANIZATION AND BASIS OF PRESENTATION** (cont.)

Wuxi Mufeng Biotechnology Co., Ltd ("Wuxi Mufeng") and Wuxi Muchen Biotechnology Co., Ltd were incorporated on February 21, 2025 in the People's Republic of China ("PRC") as a wholly owned subsidiary of Park Ha Jiangsu.

Xinyuexuan Beauty Salon（"xinyuexuan"）was incorporated on July 28, 2025 in the People's Republic of China ("PRC") and is controlled by Park Ha Jiangsu through contractual arrangement as its variable interest entity ("VIE").

Aimei Hui Beauty Salon("Aimei Hui") was incorporated on August 11, 2025 in the People's Republic of China ("PRC") and is controlled by Park Ha Jiangsu through contractual arrangement as its VIE.

Huishan DistrictXuanyayue ("xuanyayue") was incorporated on January 22, 2025,in the People's Republic of China ("PRC") and is controlled by Park Ha Jiangsu through contractual arrangement as its VIE. Xuanyayue closed down on October 10, 2025,

In support of its business expansion, the Company established three salons—Xinyuexuan, Aimei Hui, and Xuanyayue—during fiscal year 2025, in which neither it nor its subsidiaries hold any equity interest. Control over these entities is exercised by Park Ha Jiangsu through contractual arrangements in lieu of direct ownership. Pursuant to these agreements, Park Ha Jiangsu, as the actual capital contributor, is responsible for their operational management and is entitled to all profits as well as bears all losses arising therefrom. Accordingly, the Company consolidates the accounts of these entities for the periods presented herein, in accordance with Regulation S-X-3A-02 promulgated by the Securities Exchange Commission ("SEC"), and Accounting Standards Codification ("ASC") 810-10, Consolidation.

Park Ha Biological Technology Co., Ltd., its subsidiaries and VIEs are collectively referred to as the "Company".

The accompanying consolidated financial statements reflect the activities of Park Ha Cayman and each of the following entities:

---

| | | |
|:---|:---|:---|
| **Name** | **Background** | **Ownership** |
| Park Ha Biological Technology (HK) Co., Ltd. | Incorporated on October 25, 2022 as a limited liability company in Hong Kong | 100% owned by Park Ha Cayman |
| Park Ha Investment (Wuxi) Co., Ltd. | Incorporated on May 5, 2023 as a limited liability company in the PRC | 100% owned by Park Ha HK |
| Jiangsu Park Ha Biological Technology Co., Ltd. | Incorporated on August 13, 2019 as a limited liability company in the PRC | 100% owned by Park Ha Investment |
| Wuxi Xinzhan Enterprise Management Consulting Co., Ltd. | Incorporated on March 31, 2016 as a limited liability company in the PRC | 100% owned by Park Ha Investment |
| Shanghai Park Ha Industrial Development Co., Ltd. | Incorporated on April 17, 2017 as a limited liability company in the PRC | 100% owned by Xinzhan |
| Wuxi Muchen Biotechnology Co., Ltd | Incorporated on February 21, 2025 as a limited liability company in the PRC | 100% owned by Park Ha Jiangsu |
| Wuxi Mufeng Biotechnology Co., Ltd. | Incorporated on February 21, 2025 as a limited liability company in the PRC | 100% owned by Park Ha Jiangsu |
| Xinyuexuan Beauty Salon，Wuxi Economic Development Zone | Incorporated on July 28, 2025 | 100% agreement control by Park Ha Jiangsu |
| Aimeihui Beauty Center Wuxi Economic Development Zone | Incorporated on August 11, 2025 | 100% agreement control by Park Ha Jiangsu |
| Huishan District Xuanyayue Beauty Salon | Incorporated on January 22, 2025 | 100% agreement control by Park Ha Jiangsu<br> (close down on Oct.10 2025) |

---

**NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

Basis of Presentation and Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for information pursuant to the rules and regulations of the SEC.

The consolidated financial statements include the financial statements of the Company and its subsidiaries, which include the wholly-foreign owned enterprise ("WFOE") and VIEs over which the Company exercises control and, when applicable, entities for which the Company has a controlling financial interest or is the primary beneficiary. All transactions and balances among the Company and its subsidiaries have been eliminated upon consolidation.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date the financial statements and the reported amount of revenues and expenses during the reporting period. Significant accounting estimates include certain assumptions related to, among others, inventory valuations, the estimation of useful lives of property and equipment and intangible assets, allowance for expected credit losses, and income taxes including the valuation allowance for deferred tax assets. Actual results could differ from those estimates.

Functional and Presentation Currency

The functional currency of the Company is the currency of the primary economic environment in which the Company operates which is Chinese Yuan ("RMB"). The RMB is not freely convertible into the US dollar and may be subject to PRC currency restrictions for payments, including the distributions of dividends or retained earnings to the Company by its subsidiaries.

Transactions in currencies other than the entity's functional currency are recorded at the rates of exchange prevailing on the date of the transaction. At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at the end of the reporting periods. Exchange differences arising on the settlement of monetary items and on translation of monetary items at period-end are included in income statement of the period.

For the purpose of presenting these financial statements, the Company's assets and liabilities are expressed in US$ at the exchange rate on the balance sheet date, shareholder's equity accounts are translated at historical rates, and income and expense items are translated at the periodic average exchange rate during the period. The resulting translation adjustments are reported under accumulated other comprehensive loss in the shareholder's equity section of the balance sheets.

Exchange rate used for the translation as follows:

---

| | | |
|:---|:---|:---|
| **US$ to RMB** | **Period <br> End** | **Average** |
| October 31, 2025 | 7.1169 | 7.2153 |
| October 31, 2024 | 7.1178 | 7.1855 |
| October 31, 2023 | 7.2882 | 7.0560 |

---

Fair Values of Financial Instruments

The Company adopted ASC 820 "Fair Value Measurements," which defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosures requirements for fair value measures. Current assets and current liabilities qualified as financial instruments and management believes their carrying amounts are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization and if applicable, their current interest rate is equivalent to interest rates currently available. The three levels are defined as follow:

● 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, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments.

● Level 3 — inputs to the valuation methodology are unobservable and significant to the fair value.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

As of the balance sheet date, the estimated fair values of the financial instruments approximated their fair values due to the short-term nature of these instruments. Determining which category an asset or liability falls within the hierarchy requires significant judgment. The Company evaluates the hierarchy disclosures each year.

Cash and Cash Equivalents

Cash consists of cash on hand and cash in bank, as well as balances in Douyin and Meituan accounts, which are highly liquid and have original maturities of three months or less and are unrestricted as to withdrawal or use. The Company maintains cash with various financial institutions primarily in mainland China. The Company has not experienced any losses in bank accounts. The balances in Douyin and Meituan represent transaction balances from customers purchasing products through these platforms. Merchants' income can be withdrawn within 1-3 business days without any restrictions.

Accounts Receivable and Allowance for Credit Losses

Accounts receivables are stated at the historical carrying amount net of allowance for expected credit losses.

The Company adopted ASU No. 2016-13, "Financial Instruments — Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments" on January 1, 2023 using a modified retrospective approach. The Company also adopted this guidance to due from related parties, loans receivable from franchisees, other receivables. To estimate expected credit losses, the Company has identified the relevant risk characteristics of its customers and the related receivables. The Company considers the past collection experience, current economic conditions, future economic conditions (external data and macroeconomic factors) and changes in the Company's customer collection trends. The allowance for credit losses and corresponding receivables were written off when they are determined to be uncollectible.

Inventory

Inventories, which are primarily comprised of finished goods for sale, goods shipped to customer and raw materials, are stated at the lower of cost or net realizable value, using the weighted average method and is based on purchase cost. The Company evaluates the need for reserves associated with obsolete, slow-moving and non-salable inventory by reviewing net realizable values on a periodic basis.

Loans Receivable

Loans receivable are recorded at origination at the fair value less estimates for expected credit losses. Loans receivable is reviewed periodically to determine whether its carrying value has become impaired. The Company uses credit loss method to estimate the allowance for loans receivables.

Property and Equipment

Property and equipment are stated at historical cost net of accumulated depreciation. Repairs and maintenance are expensed as incurred. Property and equipment are depreciated on a straight-line basis over the following periods:

---

| | |
|:---|:---|
| Office furniture | 5 years |
| Motor vehicle | 4 years |
| Office equipment | 2.5–5 years |
| Leasehold improvements | Shorter of the remaining lease terms or estimated useful lives |

---

Intangible assets

Intangible assets with definite useful lives are amortized over their estimated useful lives to their estimated residual values. Intangible assets mainly represent software at cost, less accumulated amortization on a straight-line basis over an estimated life of ten years.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

Impairment of long-lived assets other than goodwill

Long-lived assets are evaluated 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 amount may not be fully recoverable or that the useful life is shorter than the Company had originally estimated. When these events occur, the Company evaluates the impairment by comparing carrying value of the assets to an estimate of future undiscounted cash flows expected to be generated from the use of the assets and their eventual disposition. If the sum of the expected future undiscounted cash flows is less than the carrying value of the assets, the Company recognizes an impairment loss based on the excess of the carrying value of the assets over the fair value of the assets. There was no impairment charge recognized for the years ended October 31, 2025 and 2024.

Related parties

The Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions. According to the standard, financial statements are required to disclose material related-party transactions other than compensation arrangements, expense allowances, or other similar items that occur in the ordinary course of business. A related party is essentially any party that controls or can significantly influence the management or operating policies of the company to the extent that the company may be prevented from fully pursuing its own interests. Related parties include affiliates, investees accounted for by the equity method, trusts for the benefit of employees, principal owners, management, and immediate family members of owners or management. Transactions with related parties must be disclosed even if there is no accounting recognition made for such transactions (e.g., a service is performed without payment).

Lease

The Company recognizes right-of-use ("ROU") assets and lease liabilities for its lease commitments with terms greater than one year. Contractual options to extend or terminate lease agreements are reflected in the lease term when they are reasonably certain to be exercised. The initial measurements of new ROU assets and lease liabilities are based on the present value of future lease payments over the lease term as of the commencement date. In determining future lease payments, the Company has elected not to separate lease and non-lease components. As the Company's lease arrangements do not provide an implicit interest rate, we apply the Company's incremental borrowing rate based on the information available at the commencement date in determining the present value of future lease payments. Relevant information used in determining the Company's incremental borrowing rate includes the duration of the lease, transaction currency of the lease, and the Company's credit risk relative to risk-free market rates. The Company's ROU assets also include any initial direct costs incurred and exclude lease incentives. The Company's lease agreements do not contain any significant residual value guarantees or restrictive covenants. All leases of the Company are classified as operating leases, with lease expense being recognized on a straight-line basis.

Share-based compensation

Share-based compensation is measured based on the grant date fair value of the equity instrument. Share-based compensation expenses are recognized over the requisite service period based on the graded vesting attribution method with corresponding impact reflected in additional paid-in capital. When no future services are required to be performed by grantees in exchange for an award of equity instruments, the cost of the award is expensed on the grant date. The Company elects to recognize forfeitures when they occur.

Revenue Recognition

In 2014, the FASB issued guidance on revenue recognition ("ASC 606"), with final amendments issued in 2016. The underlying principle of ASC 606 is to recognize revenue to depict the transfer of goods or services to customers at the amount expected to be collected. ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the goods or services it transfers to its customers. The Company has concluded that the new guidance did not require any significant change to its revenue recognition processes.

The Company generate revenues from sales of beauty products and devices, management of beauty salon franchisees.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

Sales of Beauty Products and Devices:

The contracts for sales of beauty products and devices are established either through direct transactions or through formal agreements, creating enforceable rights and obligations for both parties. For these sales, the Company recognizes a single performance obligation: the transfer of goods to the customer. There are no additional identifiable promises within these contracts. The transaction price is fixed and determined at inception, and payment is collected in full in advance. The Company does not offer any discounts or volume discount incentives to either franchisees or non-franchisee customers. The Company does not offer price protection but do allow for the return of goods in cases of quality issues, adhering to the standard warranty practices. The Company recorded reserve for sales returns was $nil for the fiscal years ended October 31, 2025 and 2024.

For sales at our owned store locations, revenue is recognized at the point of transfer of control, typically when the customer makes payment and accepts the goods in-store.

Regarding online sales via third-party platforms, control is transferred, and revenue is recognized at the point of delivery to the customer.

Sales and deliveries of beauty products and devices to the franchisees are treated as distinct performance obligations, separate from the franchise agreement. These transactions are not highly dependent on, nor are they integrated with, the franchise services, allowing the franchisee to benefit from the goods independently. Revenue from sales to franchisees is recognized upon the transfer of control of the goods, generally upon delivery. As franchisees take ownership and resell the products at their discretion, these transactions are not considered consignment sales.

Management of beauty salon franchisees:

The Company's franchise revenues comprise non-refundable initial franchise fees received from franchisees. The initial franchise services, which constitute the Company's obligation under these agreements, include: (i) granting exclusive operating rights in a specific area, (ii) allowing the use of the "PARK HA" brand, and (iii) providing initial setup services. These setup services encompass assistance with site selection, marketing strategy formulation, and training for franchisee management and beauticians.

Following the revenue recognition standard ASC 606, we consider the initial franchise services indistinct from the ongoing rights provided during the franchise agreement term. Consequently, these services are treated as a single performance obligation. Accordingly, initial franchise fees are deferred and recorded as a "Contract Liability." These fees are recognized over the franchise term as the performance obligation is satisfied, typically spanning one year.

The Company offers advertising and renovation subsidies to franchisees, calculated as a percentage of the franchise fee. Since these subsidies are not in exchange for distinct goods or services from franchisees, they are accounted for as a reduction in the transaction price of the franchise fee.

The Company also offers short-term loans to certain franchisees, with terms not exceeding six months. The availability and amount of such loans may vary depending on the size of the franchise arrangement. Given the short duration of these loans, as a practical expedient, the Company does not adjust for the effects of a significant financing component.

Contract liability

The contract liabilities consist of advances from customers, which relate to unsatisfied performance obligations at the end of each reporting period and consists of cash payments received in advance from customers in sales of beauty products and devices and unearned franchise fee. As of October 31, 2025 and 2024, the Company's advances from customer deposit and unearned franchise fee amounted to $194,753 and $325,924, respectively.

The Company reports revenues net of applicable sales taxes and related surcharges.

Cost of revenues

Costs of <u>revenues</u> of beauty products and devices consist primarily of materials costs, shipping and handling expenses, inspection costs and related costs, which are directly attributable to products. Write-down of inventories is also recorded in cost of <u>revenues</u>, if any.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

Costs of revenue of beauty salon franchisees consist primarily of training costs, promotional material costs and related costs, which are directly attributable to franchise business.

Shipping and handling fees incurred to transport goods to customers are paid directly to the logistics company by customers.

Selling and marketing expense

Sales and marketing expenses consist primarily of rent, depreciation of leasehold improvements, marketing conference expenses, advertising expenses and salaries and other compensation-related expenses to sales and marketing personnel. The Company expenses all advertising costs as incurred. Advertising costs amounted to $24,124 and $1,392 for the years ended October 31, 2025 and 2024, respectively.

General and administrative expenses

General and administrative expenses consist primarily of Share based Payment and salaries and benefits for employees involved in general corporate functions and those not specifically dedicated to research and development activities, depreciation and amortization of fixed assets which are not used in research and development activities, legal and other professional services fees, rental and other general corporate related expenses.

Research and development

The Company expenses research and development expenses when incurred as periodic costs. The Company recognized research and development expenses for the years ended October 31, 2025 and 2024 in the amounts of $238,184 and $36,714, respectively. Research and development expenses primarily comprise of outsourced costs, employees' wages and benefits, as well as expenditures related to patent fees.

Value Added Tax (VAT)

In accordance with the relevant tax laws in the PRC, VAT is levied on the invoiced value of sales and is payable by the purchaser. The Company is required to remit the VAT it collects to the tax authority, but may deduct the VAT it has paid on eligible purchases. The difference between the amounts collected and paid is presented as VAT recoverable or payable balance on the balance sheet.

Park Ha Jiangsu, Wuxi Xinzhan, and Park Ha Shanghai all pay taxes as small-scale enterprises, with a tax rate of 3%, so it is impossible for them to have deductible input tax;

Wuxi Muchen and Wuxi Mufeng are exempt from tax as their monthly sales do not exceed RMB100,000 according to the preferential policies for small-scale enterprises;

Aimeihui and Xinyuexuan, as individual businesses, are not required to pay taxes after being reviewed by the tax bureau based on the fixed tax system.

Income Taxes

Income taxes are provided in accordance with ASC No. 740, Accounting for Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carry-forwards. Deferred tax expense (benefit) results from the net change during the years of deferred tax assets and liabilities.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

A tax benefit from an uncertain tax position may be recognized only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities. The determination is based on the technical merits of the position and presumes that the relevant taxing authority that has full knowledge of all relevant information will examine each uncertain tax position. Although the Company believes the estimates are reasonable, no assurance can be given that the final outcome of these matters will not be different than what is reflected in the historical income tax provisions and accruals.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

Comprehensive Income (Loss)

Comprehensive income is defined to include all changes in equity except those resulting from net income or loss, investments by owners and distributions to owners. The Company's only component of other comprehensive income is the foreign currency translation adjustment.

Statutory Reserves

Pursuant to the laws applicable to the PRC, PRC entities must make appropriations from after-tax profit to the non-distributable "statutory surplus reserve fund". Subject to certain cumulative limits, the "statutory surplus reserve fund" requires annual appropriations of 10% of after-tax profit until the aggregated appropriations reach 50% of the registered capital (as determined under accounting principles generally accepted in the PRC ("PRC GAAP") at each year-end). For foreign-invested enterprises and joint ventures in the PRC, annual appropriations should be made to the "reserve fund". For foreign-invested enterprises, the annual appropriation for the "reserve fund" cannot be less than 10% of after-tax profits until the aggregated appropriations reach 50% of the registered capital (as determined under PRC GAAP at each year-end). If the Company has accumulated loss from prior periods, the Company is able to use the current period net income after tax to offset the accumulated loss.

Earnings per share

Basic earnings (loss) per share is computed by dividing net income (loss) attributable to the holders of ordinary shares by the weighted average number of ordinary shares outstanding during the year. Diluted earnings (loss) per share is calculated by dividing net income (loss) 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. For the years ended October 31, 2025 and 2024, the Company does not have any dilutive ordinary shares equivalents,therefore, a separate computation of diluted earnings (loss) per share is not presented.

Commitments and Contingencies

The Company follows ASC 450-20, "Loss Contingencies," to report accounting for contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines, penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated. There were no commitments or contingencies as of October 31, 2025 and 2024.

Segment reporting

ASC 280, Segment Reporting, ("ASC 280"), establishes standards for companies to report in their financial statements information about operating segments, products, services, geographic areas, and major customers.

Based on the criteria established by ASC 280, our chief operating decision maker ("CODM") has been identified as our Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the company. As a whole and hence, we have two business segments which comprised of products sales and franchise service. As our long-lived assets are substantially located in the PRC, no geographical segments are presented.

Concentration and risks

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Concentration of credit risk

Financial instruments that potentially subject the Company to concentration of credit risk are cash, and accounts receivable arising from its normal business activities. The Company places its cash in what it believes to be credit-worthy financial institutions or trading platforms.

The Company conducts credit evaluations of customers, and generally does not require collateral or other security from its customers. The Company establishes an allowance for expected credit losses primarily based upon the factors surrounding the credit risk of specific customers.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (cont.)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Foreign currency exchange rate risk

The functional currency and the reporting currency of the Company are RMB and U.S. dollars, respectively. The Company's exposure to foreign currency exchange rate risk primarily relates to cash, accounts receivable and accounts payable. Any significant fluctuation of RMB against U.S. dollars may materially and adversely affect the Company's cash flows, revenues, earnings and financial positions.

Recent Accounting Pronouncements

In November 2023, the FASB issued Accounting Standards Update No. 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures" ("ASU 2023-07"), which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The guidance is to be applied retrospectively to all prior periods presented in the financial statements. Upon transition, the segment expense categories and amounts disclosed in the prior periods should be based on the significant segment expense categories identified and disclosed in the period of adoption. We are currently evaluating the impact of the update on our consolidated financial statements and related disclosures.

Other accounting standards that have been issued by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on, or are unrelated to, its consolidated financial condition, results of operations, cash flows or disclosures.

**Note 3 – Variable interest entity**

On July 28, 2025, August 11, 2025 and January 22, 2025, Park Ha Jiangsu entered into the Contractual Arrangements with Xinyuexuan, Aimeihui and Xuanyayue. The significant terms of these Contractual Arrangements are summarized in "Note 1 – Nature of business and organization" above. As a result, the Company classifies Xinyuexuan , Aimeihui and Xuanyayue as a VIE which should be consolidated based on the structure as described in Note 1.

A VIE is an entity that has either a total equity investment that is insufficient to permit the entity to finance its activities without additional subordinated financial support, or whose equity investors lack the characteristics of a controlling financial interest, such as through voting rights, right to receive the expected residual returns of the entity or obligation to absorb the expected losses of the entity. The variable interest holder, if any, that has a controlling financial interest in a VIE is deemed to be the primary beneficiary and must consolidate the VIE. Park Ha Jiangsu is deemed to have a controlling financial interest and be the primary beneficiary of Xinyuexuan, Aimeihui and Xuanyayue, because it has both of the following characteristics:

&nbsp;&nbsp;&nbsp;&nbsp;(1) The
 power to direct activities at Xinyuexuan, Aimeihui and Xuanyayue, that most significantly
 impact such entity's economic performance, and

&nbsp;&nbsp;&nbsp;&nbsp;(2) The
 right to receive benefits from Xinyuexuan, Aimeihui and Xuanyayue that could potentially
 be significant to such entity.

Pursuant to the Contractual Arrangements, Park Ha Jiangsu, as the actual capital contributor, is responsible for their operational management and is entitled to all profits generated from these entities as well as bears all losses incurred thereby. The Contractual Arrangements are designed so that Xinyuexuan, Aimeihui and Xuanyayue operates for the benefit of Park Ha Jiangsu and ultimately, the Company.

Under the Contractual Arrangements, the Company has the power to direct activities of the VIEs and can have assets transferred out of the VIEs. Therefore, the Company considers that there is no asset in the VIEs that can be used only to settle obligations of the VIEs, except for registered capital and PRC statutory reserves, if any. As the VIEs are incorporated as Individually-Owned Business under the Company Law of the PRC, creditors of the VIEs do not have recourse to the general credit of the Company for any of the liabilities of the VIEs.

Accordingly, the accounts of Xinyuexuan ,Aimeihui and Xuanyayue are consolidated in the accompanying consolidated financial statements. In addition, its financial positions and results of operations are included in the Company's consolidated financial statements.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**Note 3 – Variable interest entity** (cont.)

The carrying amount of the VIEs' consolidated assets and liabilities are as follows:

---

| | | |
|:---|:---|:---|
|  | **October 31, 2025** | **October 31, 2024** |
| **ASSETS** | | |
| **Current assets** | | |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | 97472 |  |
| &nbsp;&nbsp;&nbsp;Accounts receivables, net | 2006 |  |
| &nbsp;&nbsp;&nbsp;Amounts due from Group companies | 2062 |  |
| &nbsp;&nbsp;&nbsp;Inventories, net | 3611 |  |
| &nbsp;&nbsp;&nbsp;Other receivables and other current assets | 570 |  |
| &nbsp;&nbsp;&nbsp;**Total current assets** | 105721 |  |
| &nbsp;&nbsp;&nbsp;**Non-current Assets** |  |  |
| &nbsp;&nbsp;&nbsp;Property and equipment, net | 99675 |  |
| &nbsp;&nbsp;&nbsp;Operating lease right of use asset, net | 34508 |  |
| &nbsp;&nbsp;&nbsp;Other non-current assets | 1405 |  |
| &nbsp;&nbsp;&nbsp;**Total non-current assets** | 135588 |  |
| &nbsp;&nbsp;&nbsp;**TOTAL ASSETS** | 241309 |  |
| **<u>LIABILITIES AND SHAREHOLDERS' EQUITY</u>** |  |  |
| &nbsp;&nbsp;&nbsp;**Current liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;Amounts due to Group companies | 76226 |  |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities – current | 22526 |  |
| &nbsp;&nbsp;&nbsp;Accruals and other payables | 36255 |  |
| &nbsp;&nbsp;&nbsp;**Total current liabilities** | 135007 |  |
| &nbsp;&nbsp;&nbsp;Non-current liabilities |  |  |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities – non-current | 12901 |  |
| &nbsp;&nbsp;&nbsp;Total non-current assets | 12901 |  |
| &nbsp;&nbsp;&nbsp;**TOTAL LIABILITIES** | 147908 |  |

---

The summarized operating results of the VIEs are as follows:

---

| | | |
|:---|:---|:---|
|  | **Year Ended October 31,<br> 2025** | **Year Ended October 31,<br> 2024** |
| Revenues, net | 130791 |  |
| Cost of revenues | 3797 |  |
| Gross profit | 126994 |  |
| Operating expenses |  |  |
| Selling and marketing expenses | 36872 |  |
| General and administrative expenses | 1146 |  |
| Total operating expenses | 38018 |  |
| Operating income | 88976 |  |
| Other income (expense): |  |  |
| &nbsp;&nbsp;&nbsp;Other income (expense) | 3149 |  |
| Interest income | 2 |  |
| Total other income (expenses) | 3151 |  |
| Net income | 92127 |  |

---

In accordance with contractual agreements, the Company has the power to direct the activities of the VIEs and can have assets transferred out of the VIEs. Therefore, the Company considers that there are no assets in the respective VIEs that can be used only to settle obligations of the respective VIEs as of October 31, 2025 and 2024. As the respective VIEs are incorporated as individual business under the PRC Company Law, creditors do not have recourse to the general credit of the Company for the liabilities of the respective VIEs.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 4 — ACCOUNTS RECEIVABLES, NET** (cont.)

Accounts receivables, net is comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Accounts receivables – Non-franchisees | 22331 | 157769 |
| Allowance for expected credit losses | (17866) | (157769) |
| Accounts receivables, net – Non-franchisees | 4465 |  |

---

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Accounts receivables – Franchisees | 378372 | 404974 |
| Allowance for expected credit losses | (126993) | (74082) |
| Accounts receivables, net – Franchisees | 251379 | 330892 |

---

The following is a summary of the activity in the allowance for expected credit losses:

---

| | | |
|:---|:---|:---|
|  | **October 31, 2025** | **October 31, 2024** |
| Balance at beginning of year – Non-franchisees | 157769 | 24398 |
| Provision |  | 132787 |
| Reversal | (50091) |  |
| Written-off | (87923) |  |
| Effect of translation adjustment | (1889) | 584 |
| Balance at end of year – Non-franchisees | 17866 | 157769 |

---

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Balance at beginning of year – franchisees | 74082 | 66106 |
| Provision | 52180 | 6393 |
| Reversal |  |  |
| Effect of translation adjustment | 731 | 1583 |
| Balance at end of year – franchisees | 126993 | 74082 |

---

**NOTE 5 — INVENTORIES, NET**

Inventory comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Raw materials | 13254 | 22606 |
| Goods shipped to customer |  | 1914 |
| Finished goods | 74491 | 46966 |
| Allowance for Inventory | (12531) |  |
| Inventories, net | 75214 | 71486 |

---

The Company write off inventory $1,430 and $15,955 for the years ended October 31, 2025 and 2024, respectively, due to expiration and obsoletion.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 6 — LOANS RECEIVABLE FROM FRANCHISEES, NET**

Loans receivables from franchisees consist of non-interest-bearing advances provided by the Company to its franchisees to purchase inventory, equipment; or for use as working capital. The maturity date of the loan is 180 days from the date of disbursement of funds.

Loan receivables from franchisees, net comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Loan receivables from franchisees | 1254057 | 801512 |
| Allowance for expected credit losses | (232876) | (55520) |
| Loan receivables from franchisees, net | 1021181 | 745992 |

---

The following is a summary of the activity in the allowance for expected credit losses:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Balance at beginning of year | 55520 | 62602 |
| Provision | 183501 |  |
| Reversal |  | (8580) |
| Written-off | (8571) |  |
| Effect of translation adjustment | 2426 | 1498 |
| Balance at end of year | 232876 | 55520 |

---

The following is a summary of the movement of the loan:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Balance at beginning of year | 801512 | 362917 |
| Loans lend to franchisees | 1103211 | 1236518 |
| Repayment from franchisees | (656937) | (810660) |
| Effect of translation adjustment | 6271 | 12737 |
| Balance at end of year | 1254057 | 801512 |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 6 — LOANS RECEIVABLE FROM FRANCHISEES, NET** (cont.)

The amount of loans that are past due as of October 31, 2025 and 2024 were $947,042 and $55,495, respectively.

Loans receivable from franchisees, net comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31,<br> 2025** | **October 31,<br> 2024** |
| Gao Wenjing | 52691 | 52685 |
| Wang Shimei | 52691 |  |
| Zeng Yongjian | 46369 | 46361 |
| Song Mingfang | 52691 |  |
| Wang Zhiya | 52691 | 52685 |
| Yu Yang | 108896 | 52685 |
| Wang Limin |  | 52685 |
| Wang Xuefeng | 182664 | 182641 |
| Zheng Yanhai | 9133 | 9132 |
| Chen Yu | 9133 | 9132 |
| Zhang Ying | 9133 | 9132 |
| Wang Hongli | 9133 | 9132 |
| Ge Xiaoqing |  | 9132 |
| Zhu Hongjun |  | 52685 |
| Liu Jie |  | 52685 |
| Zhou Qianqian |  | 52685 |
| Meng Hao | 52691 | 52685 |
| Liu Zonghui |  | 52685 |
| Wu Yinghan | 182664 |  |
| Liu Yuping | 182664 |  |
| Xiao Yang | 18266 |  |
| Shen Yue | 9133 |  |
| Zhao Zhe | 9134 |  |
| Shen Huaimei | 108896 |  |
| Tang Sumei | 52692 |  |
| Li Ruonan | 52692 | 52685 |
|  | **1254057** | **801512** |
| Less: Allowance for expected credit loss | (232876) | (55520) |
| **Loan receivables from franchisees, net** | **1021181** | **745992** |

---

**NOTE 7 — OTHER RECEIVABLES AND OTHER CURRENT ASSETS**

Other receivables and other current assets comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Other receivables | 25765 | 69454 |
| Deferred IPO Cost |  | 1088400 |
| Prepaid expenses | 337863 | 8030 |
| Total | **363628** | 1165884 |
| Less：Allowance for expected credit losses | (11002) | (51013) |
| Other receivables and other current assets, net | 352626 | 1114871 |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 8 — PROPERTY & EQUIPMENT, NET**

Property and equipment, net comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| At Cost: |  |  |
| Office furniture | 8856 | 8855 |
| Motor vehicle | 147591 | 147573 |
| Office equipment | 13189 | 8129 |
| Leasehold improvements | 265653 | 106775 |
|  | **435289** | **271332** |
| Less: Accumulated depreciation | **(277290)** | **(167372)** |
| Total, net | 157999 | 103960 |

---

Depreciation expenses was $108,399 and $21,712 for the years ended October 31, 2025 and 2024, respectively.

**NOTE 9 — INTANGIBLE ASSETS, NET**

Intangible assets, net comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| At cost: |  |  |
| Trademark | 253 | 253 |
| Software | 9836 | 9834 |
|  | **10089** | **10087** |
| Less: Accumulated depreciation | (3450) | (2466) |
| Total, net | 6639 | 7621 |

---

Amortization expenses was $970 and $974 for the years ended October 31, 2025 and 2024, respectively.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **For the years ending October 31,** | **For the years ending October 31,** | **For the years ending October 31,** | **For the years ending October 31,** | **For the years ending October 31,** | **For the years ending October 31,** |
|  | **2026** | **2027** | **2028** | **2029** | **2030** | **thereafter** |
| Amortization expenses | 984 | 984 | 984 | 984 | 984 | 1719 |

---

**NOTE 10 — OTHER NON-CURRENT ASSETS**

Other non-current assets comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Deferred Tax Asset, net | 83357 | 56310 |
| Lease deposits | 22416 | 407 |
| Total, net | 105773 | 56717 |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 11— TAXES PAYABLE**

Taxes payable comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Enterprise income tax payable | 1010451 | 699633 |
| Value-added tax, net | 327124 | 271404 |
| City maintenance and construction tax | 21331 | 17018 |
| Additional education fees | 9286 | 7438 |
| Other taxes | 7296 | 5531 |
| Total | 1375488 | 1001024 |

---

**NOTE 12 — CONTRACT LIABILITIES**

For service contracts where the performance obligation is not completed, contract liabilities were recorded for any payments received in advance of the performance obligation. The payments received in advance will not be refunded and will be amortized in future when met performance obligations.

Contract liabilities is comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **As of** | **As of** |
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Unearned franchise fee | 194753 | 309315 |
| Customer deposit |  | 16609 |
| Total, net | 194753 | 325924 |

---

The amount of revenue recognized that was included in the contract liabilities at the beginning of the year were $325,924 and $250,549 for the years ended October 31, 2025 and 2024, respectively.

Unearned franchise fee comprised of the following:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, <br> 2024** |
| Li Yi |  |  |  | 7005 |
| Gao Wenjing |  |  |  | 31563 |
| Wang Zhiya |  |  |  | 23287 |
| Yu Yang |  | 58015 |  |  |
| Wang Limin |  |  |  | 12510 |
| Li Jie |  |  |  | 6390 |
| Sheng Xidong |  |  |  | 6890 |
| Zhou Guixiang |  |  |  | 13626 |
| Wang Xuefeng |  |  |  | 40801 |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 12— CONTRACT LIABILITIES** (cont.)

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Ge Xiaoqing |  | 6967 |
| Li Ruonan |  | 2309 |
| Meng Hao |  | 7313 |
| Chen Yu |  | 500 |
| Wang Hongli | 2850 | 2848 |
| Zhang Ying | 2964 | 2964 |
| Liu Zonghui |  | 16359 |
| Liu Jie |  | 41955 |
| Zhu Hongjun |  | 45612 |
| Zhou Qianqian |  | 40416 |
| Zheng Tinghai | 12242 |  |
| Tang Sumei | 26947 |  |
| Jin Huazhong | 34935 |  |
| Shen Huaimei | 56800 |  |
| Total | 194753 | 309315 |

---

**NOTE 13 — RELATED PARTY TRANSACTIONS**

The Company had transactions with the following related parties:

---

| | |
|:---|:---|
| **Name of Related Party** | **Nature of Relationship** |
| Guozhen Liu | Limited partner of Changxin International Limited Partnership, executive director and legal representative of Park Ha Shanghai, supervisor of Xinzhan, parent of Xiaoqiu Zhang |
| Fujun Yu | Legal representative and executive director of Park Ha Jiangsu, supervisor of Park Ha Shanghai |
| Hengquan Zhang | Supervior of Park Ha Jiangsu, parent of Xiaoqiu Zhang |
| Xiaoqiu Zhang | CEO, Chairperson of the board of directors, controlling shareholder of Park Ha Cayman |
| Li Wang | Supervisor of Park Ha Investment, director of the Company |

---

***Due from related party***

 ****

The Company made advances to Ms. Xiaoqiu Zhang for working capital to be paid on behalf of the Company. The balance due from Ms. Xiaoqiu Zhang was $35 and $14,339 as of October 31, 2025 and 2024, respectively.

***Due to related party***

Ms. Li Wang made a payment for rent on behalf of the Company. The balance due to Ms. Li Wang was $7,026 and $nil as of October 31, 2025 and 2024, respectively.

The amounts due from related party and due to related party above are non-interest bearing, without maturity and due on demand.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 14 — LEASES**

The Company has entered into several operating leases for its self-operated stores, dormitories and offices. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company accounts for the lease and non-lease components of its leases as a single lease component. Lease expense is recognized on a straight-line basis over the lease term.

Operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The discount rate used to calculate present value is incremental borrowing rate or, if available, the rate implicit in the lease. The Company determines the incremental borrowing rate for each lease based primarily on its lease term in PRC which are approximately 3.25%, 3.75% and 3.73% for the fiscal year ended October 31, 2025 , 2024 and 2023, respectively.

Operating lease expenses were $37,386 , $30,425 and $45,869 for the fiscal years ended October 31, 2025 , 2024 and 2023, respectively.

The components of lease expense and supplemental cash flow information related to leases for the period are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the years ended October 31,** | **For the years ended October 31,** | **For the years ended October 31,** |
|  | **2025** | **2024** | **2023** |
| Lease Cost |  |  |  |
| Operating lease cost | $37386 | $30425 | $45869 |
| Other Information |  |  |  |
| Cash paid for amounts included in the measurement of lease liabilities | $37043 | $30435 | $44654 |
| Weighted average remaining lease term – operating leases (in years) | 2.47 | 4.64 | 1.54 |
| Average discount rate – operating lease | 3.25% | 3.75% | 3.73% |

---

The supplemental balance sheet information related to leases is as follows:

---

| | | |
|:---|:---|:---|
|  | **As of October 31,** | **As of October 31,** |
|  | **2025** | **2024** |
| Operating leases |  |  |
| Right-of-use assets | $180243 | $70739 |
| Operating lease liabilities, current | $104254 | $17573 |
| Operating lease liabilities, non-current | $75915 | $52745 |
| Total operating lease liabilities | $180169 | $70318 |

---

The undiscounted future minimum lease payment schedule as follows:

---

| | |
|:---|:---|
| **For the years ending October 31,** | |
| 2026 | 39090 |
| 2027 | 75201 |
| 2028 | 48071 |
| 2029 | 23606 |
| 2030 |  |
| Total undiscounted lease payments | 185968 |
| Less imputed interest | (5799) |
| Total lease liabilities | 180169 |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 15 — SHAREHOLDERS' EQUITY**

The Company was incorporated in the Cayman Islands in October 2022 under the Cayman Islands Companies Act as an exempted company with limited liability.

For the year ended October 31, 2022, the Company issued 5,000,000 shares to certain founding shareholders in exchange for US$500 based on the par value. On June 29, 2024, our shareholders approved a share split of our outstanding Ordinary Shares at a ratio of 1:5. The Company has retroactively restated all share data for all of the periods presented pursuant to ASC 260 to reflect the share split, resulting in 25,000,000 Ordinary Shares issued and outstanding after the share split.

On December 26, 2024, the Company completed initial public offering, issued and sold 1,200,000 Ordinary Shares, at $4.00 per share for $4.80 million. The net proceeds of $3.89 million after deducting underwriting discounts and the offering expenses payable was received by the Company.

On January 24, 2025, the Company issued and sold 174,403 shares to an over-allotment arrangement, at $4.00 per share for $0.70 million. The net proceeds of 0.38million after deducting underwriting discounts and the offering expenses payable was received by the Company

On February 28, 2025, the Board of Directors resolved and approved: the company adopt the 2025 Equity Incentive Plan, under which the total number of authorized and issuable shares of the company's common stock (with a par value of $0.00002 per share) shall be 3,000,000 shares. On March 5, 2025, the company entered into five grant agreements with the respective grantees, specifying the grant date as March 5, 2025, with the vesting arrangement being immediately exercisable. The company recognized share-based compensation included in administrative expenses of $19,950,000 for the year ended October 31, 2025, calculated based on the fair value price of $6.65 per share on the grant date of March 5, 2025 multiplied by 3,000,000 shares.

On July 7, 2025, the Board of Directors resolved and approved: The Company intends to adopt the 2025 Equity Incentive Plan, under which the total number of authorized and issuable shares of the Company's common stock (with a par value of $0.00002 per share) shall be 4,500,000 shares. On July 14, 2025, the Company entered into four grant agreements with the respective grantees, specifying the grant date as July 14, 2025, with the vesting arrangement being immediately exercisable. The company recognized share-based compensation included in administrative expenses of $4,120,200 for the year ended October 31, 2025, calculated based on the fair value price of $0.9156 per share on the grant date of July 14, 2025 multiplied by 4,500,000 shares.

On October 3, 2025, at the 2025 annual general meeting of shareholders (the "AGM") of the Company, the shareholders of the Company passed resolutions to increase the Company's authorized share capital and re-classify and re-designate the Company's authorized share capital. As a result, immediately following the AGM, the Company's authorized share capital was increased, and re-classified and re-designated from US$50,000 divided into 2,500,000,000 Ordinary Shares of par value US$0.00002 each to US$300,000 divided into 12,000,000,000 Class A Ordinary Shares of par value US$0.00002 each, with each Class A Ordinary Share entitled to one vote, and 3,000,000,000 Class B Ordinary Shares of par value US$0.00002 each, with each Class B Ordinary Share entitled to 20 votes. The Company has retroactively restated all share data for all of the periods presented pursuant to ASC 260 to reflect the share reorganization.

On December 26, 2025, the Company held an extraordinary meeting of shareholders, during which the shareholders approved a proposal to effect a reverse stock split (the "Reverse Split"), the Board of Directors of the Company subsequently approved the Reverse Split, and the exact ratio which is 1-for-50 on January 29, 2026. The Reverse Split became effective on February 20, 2026, and the Class A Ordinary Shares began trading on a post-Reverse Split basis on the Nasdaq Capital Market when the market opened on February 23, 2026 under the same symbol "BYAH.", 35 fractional shares were issued in connection with the Reverse Split. All fractional shares were rounded up to the whole number of shares. Each 50 pre-split ordinary shares outstanding automatically combined and converted to one issued and outstanding ordinary share without any action on the part of the shareholders. The Company has retroactively restated all share and per share data for all of the periods presented pursuant to ASC 260 to reflect the Reverse Split.

As of October 31, 2025, there were 296,488 Class A ordinary shares and 381,000 Class B ordinary shares issued and outstanding.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 16 — RESTRICTED NET ASSETS**

As a result of the PRC laws and regulations and the requirement that distributions by PRC entities can only be paid out of distributable profits computed in accordance with PRC GAAP, the PRC entities are restricted from transferring a portion of their net assets to the Company. Amounts restricted include paid-in capital, additional paid-in capital, and the statutory reserves of the Company's PRC subsidiaries.

---

| | | |
|:---|:---|:---|
|  | **As of** | **As of** |
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| Additional paid in capital | 2561211 | 1161211 |
| Statutory reserve | 217264 | 131962 |
| Total | 2778475 | 1293173 |

---

**NOTE 17 — SEGMENTS INFORMATION**

The Company believes that it operates in two business segments which comprised of products sales and franchise service; and it operates in one geographical location China. The Company disaggregates its revenue into categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors.

Summarized financial information for the two reportable segments is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended October 31, 2025** | **Year Ended October 31, 2025** | **Year Ended October 31, 2025** |
|  | **Product <br> Sales** | **Franchise <br> fees** | **Consolidated** |
| Revenues, net | 1014034 | 1510809 | 2524843 |
| Cost of revenues | 129326 | 13200 | 142526 |
| Gross profit | 884708 | 1497609 | 2382317 |
| Depreciation and amortization | 109369 |  | 109369 |
| Other (income) expense, net | 11130126 | 15226929 | 26357055 |
| Income tax expenses (benefits) | 18198 | 262448 | 280646 |
| Net Income (loss) | (10372985) | (13991768) | (24364753) |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended October 31, 2024** | **Year Ended October 31, 2024** | **Year Ended October 31, 2024** |
|  | **Product <br> Sales** | **Franchise <br> fees** | **Consolidated** |
| Revenues, net | 707231 | 1674620 | 2381851 |
| Cost of revenues | 88983 | 106353 | 195336 |
| Gross profit | 618248 | 1568267 | 2186515 |
| Depreciation and amortization | 18636 | 4050 | 22686 |
| Other (income) expense, net | 742202 | 628206 | 1370408 |
| Income tax expenses (benefits) | (23992) | 338852 | 314860 |
| Net Income (loss) | (118598) | 597159 | 478561 |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 17 — SEGMENTS INFORMATION** (cont.)

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended October 31, 2023** | **Year Ended October 31, 2023** | **Year Ended October 31, 2023** |
|  | **Product <br> Sales** | **Franchise <br> fees** | **Consolidated** |
| Revenues, net | 648745 | 1810357 | 2459102 |
| Cost of revenues | 141785 | 169204 | 310989 |
| Gross profit | 506960 | 1641153 | 2148113 |
| Depreciation and amortization | 4936 | 15127 | 20063 |
| Other (income) expense, net | 558094 | 388387 | 946481 |
| Income tax expense (benefit) | (17163) | 346690 | 329527 |
| Net Income (loss) | (38907) | 890949 | 852042 |

---

Summarized financial information for revenues, costs and profits is as follows

Sales revenues comprised of the following:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **October 31,** | **October 31,** | **October 31,** | **October 31,** | **October 31,** | **October 31,** |
|  | **2025** | **2025** | **2024** | **2024** | **2023** | **2023** |
| Products sales – Non-franchisees | 535760 | 21% | 355832 | 15% | 302505 | 12% |
| Product sales – Franchisees | 478274 | 19% | 351399 | 15% | 346240 | 14% |
| Franchise fees | 1510809 | 60% | 1674620 | 70% | 1810357 | 74% |
| Amount | 2524843 | **100%** | 2381851 | **100%** | 2459102 | **100%** |

---

Direct costs comprised of the following:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **October 31, <br> 2025** | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, <br> 2024** | **October 31, <br> 2023** | **October 31, <br> 2023** |
| Products sales – Non-franchisees | 21982 | 15% | 21390 | 11% | 45770 | 15% |
| Product sales – Franchisees | 107344 | 75% | 67593 | 35% | 96015 | 31% |
| Franchise fees | 13200 | 10% | 106353 | 54% | 169204 | 54% |
| Amount | 142526 | **100%** | 195336 | **100%** | 310989 | **100%** |

---

Gross profit comprised of the following:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **October 31, <br> 2025** | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, <br> 2024** | **October 31, <br> 2023** | **October 31, <br> 2023** |
| Productssales – Non-franchisees | 513778 | 22% | 334422 | 15% | 256735 | 12% |
| Product sales – Franchisees | 370930 | 16% | 283806 | 13% | 250225 | 12% |
| Franchise fees | 1497609 | 62% | 1568267 | 72% | 1641153 | 76% |
| Amount | 2382317 | **100%** | 2186515 | **100%** | 2148113 | **100%** |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 18 — CONCENTRATION RISKS**

Concentration of credit risk

Cash deposits with banks are held in financial institutions in China, which deposits are not federally insured. Accordingly, the Company has a concentration of credit risk related to the uninsured part of bank deposits. The Company has not experienced any losses in such accounts and believes it is not exposed to significant credit risk.

Concentration of customers and suppliers

The Company has a concentration risk related to suppliers and customers. Failure to maintain existing relationships with the suppliers or customers to establish new relationships in the future could negatively affect the Company's ability to obtain goods sold to customers in a price advantage and timely manner. If the Company is unable to obtain ample supply of goods from existing suppliers or alternative sources of supply, the Company may be unable to satisfy the orders from its customers, which could materially and adversely affect revenues.

The customers accounting for 10% or more of the company's revenue include the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Percentage of Company revenue |  |  |  |
| Customer G | 6% | 10% | 10% |
| Customer F | 6% | 10% | 10% |

---

The customers that accounted for 10% or more of the Company's accounts receivable comprised of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Percentage of the Company's accounts receivable |  |  |  |
| Customer A | —% | 17% | 16% |
| Customer B | —% | 7% | 9% |
| Customer C | —% | 1% | 11% |
| Customer D | 4% | 3% | 4% |
| Customer E | —% | 8% | 3% |
| Customer F | —% | 15% | 18% |
| Customer G | —% | 4% | 17% |
| Customer J | 28% | —% | —% |
| Customer L | 11% | —% | —% |
| Customer K | 15% | —% | —% |

---

The suppliers that accounted for 10% or more of the Company's purchases comprised of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Percentage of the Company's purchases |  |  |  |
| Supplier A | 8% | 15% | 9% |
| Supplier B | 9% | 11% | 7% |
| Supplier C | 5% | 10% | —% |
| Supplier D | 26% | —% | —% |
| Supplier E | 11% | 5% | 1% |
| Supplier F | 1% | 11% | 58% |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 18 — CONCENTRATION RISKS** (cont.)

The suppliers that accounted for 10% or more of the Company's account payables comprised of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** | **For the years ended <br> October 31,** |
|  | **2025** | **2024** | **2023** |
| Percentage of the Company's accounts payable |  |  |  |
| Supplier F | —% | 36% | 63% |
| Supplier G | 81% | 55% | 7% |
| Supplier H | 19% | 9% | 4% |

---

**NOTE 19 — INCOME TAX**

*Cayman Islands*

Under the current laws of the Cayman Islands, entities are not subject to tax on income or capital gain. In addition, payments of dividends by the Company to their shareholders are not subject to withholding tax in the Cayman Islands.

*Hong Kong*

Park Ha Biological Technology (HK) Co., Ltd. is incorporated in Hong Kong and is subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements adjusted in accordance with relevant Hong Kong tax laws. The applicable tax rate for the first HKD$2 million of assessable profits is 8.25% and assessable profits above HKD$2 million will continue to be subject to the rate of 16.5% for corporations in Hong Kong, effective from the year of assessment 2018/2019. Park Ha Biological Technology (HK) Co., Ltd. did not make any provisions for Hong Kong profit tax as there were no assessable profits derived from or earned in Hong Kong since inception. Under Hong Kong tax laws, Park Ha Biological Technology (HK) Co., Ltd.is exempted from income tax on its foreign-derived income and there are no withholding taxes in Hong Kong on remittance of dividends for the year ended October 31, 2025 ,2024 and 2023.

*China, PRC*

The Company in general is subject to profits tax rate at 25% for income generated for its operation in China and net operating losses can be carried forward for no longer than five years starting from the year subsequent to the year in which the loss was incurred.

In accordance with the implementation rules of EIT Laws, a qualified "High and New Technology Enterprise" ("HNTE") is eligible for a preferential tax rate of 15%. The HNTE certificate is effective for a period of three years. An entity could re-apply for the HNTE certificate when the prior certificate expires. "Park Ha Jiangsu" obtained its HNTE certificate on November 6, 2024. Therefore, "Park Ha Jiangsu" is eligible to enjoy a preferential tax rate of 15% from 2024 to 2026 to the extent it has taxable income under the EIT Law.

Announcement No. 12 [2023] of the Ministry of Finance and the State Taxation Administration stipulates that the preferential corporate income tax (CIT) policy for small and low-profit enterprises (SLPEs) — reducing taxable income by 25% and applying a 20% tax rate — shall be extended until December 31, 2027.Wuxi Muchen and Wuxi Mufeng and Park Ha investment, with annual taxable income not exceeding RMB 1 million for the year ended October 31, 2025, qualify as SLPEs. As such, 25% of their taxable income is subject to CIT at the reduced rate of 20%.

Ai Meihui obtained the "Review Approval Notification for Application and Adjustment of Fixed Amount for Periodic Fixed-Amount Taxpayers" issued by the State Taxation Administration, Jiangsu Wuxi Economic Development Zone Tax Bureau on August 30, 2025, indicating that the application for "Periodic Fixed-Amount Taxpayer Application and Adjustment of Fixed Amount" submitted by Ai Meihui on August 22, 2025, has been approved. Upon review, Ai Meihui's account shall implement a monthly taxable amount of 0 RMB from August 1, 2025, to December 31, 2025.

Xinyuexuan obtained the "Review Approval Notification for Application and Adjustment of Fixed Amount for Periodic Fixed-Amount Taxpayers" issued by the State Taxation Administration, Jiangsu Wuxi Economic Development Zone Tax Bureau on August 19, 2025, indicating that the application for "Periodic Fixed-Amount Taxpayer Application and Adjustment of Fixed Amount" submitted by Xinyuexuan on August 11, 2025, has been approved. Upon review, Xinyuexuan's account shall implement a monthly taxable amount of 0 RMB from July 1, 2025, to December 31, 2025.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 19 — INCOME TAX** (cont.)

*Income taxes in the PRC are consist of*:

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, <br> 2023** |
| Current income tax expense | 307317 | 336325 | 363264 |
| Deferred income tax benefit | (26671) | (21465) | (33737) |
| Total income tax expense (benefit) | 280646 | 314860 | 329527 |

---

The net taxable income before income taxes and its provision for income taxes comprised of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended** | **Year Ended** | **Year Ended** |
|  | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, 2023** |
| Income before income tax expenses | (24084107) | 793421 | 1181569 |
| PRC statutory tax rate | 25% | 25% | 25% |
| Income tax expense at PRC statutory income tax rate | (6021026) | 198356 | 295393 |
| Effect of different tax jurisdiction | 6202101 |  |  |
| Tax effect of preferential tax treatments | 7391 | 112241 | 4375 |
| Research and development credit | (45429) | (5507) | (4632) |
| Non-deductible expenses | 3078 | 2510 | 48158 |
| Change in valuation allowance | 134531 | 7260 | (13767) |
| Tax expense (benefit), net | 280646 | **314860** | **329527** |

---

Deferred tax assets consist of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of** | **As of** | **As of** |
|  | **October 31, <br> 2025** | **October 31, <br> 2024** | **October 31, <br> 2023** |
| Net operating losses carried forward in the PRC | 138115 | 85404 | 77818 |
| Allowance of expected credit loss | 81598 | 56310 | 33830 |
| Allowance for inventory | 1759 |  |  |
| Total | 221472 | 141714 | 111648 |
| Less: Valuation allowance | (138115) | (85404) | (77818) |
| Deferred tax assets, net | 83.357 | 56310 | 33830 |

---

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries Notes to the Consolidated Financial Statements**

**NOTE 19 — INCOME TAX** (cont.)

As of october 31, 2025 and october 31, 2024 , the Company's PRC entities had net operating loss carryforwards of approximately $1.18 million and $0.47 million, respectively which will start to expire from 2025. The Company reviews deferred tax assets for a valuation allowance based upon whether it is more likely than not that the deferred tax asset will not be fully realized. As of october 31, 2025 and October 31, 2024, full valuation allowance is provided against the deferred tax assets related to the Company's net operating loss carryforwards based upon management's assessment as to their realization.

**Note 20 – Commitments and contingencies**

*<u>Variable interest entity structure</u>*

 

In the opinion of management, (i) the corporate structure of the Company is in compliance with existing PRC laws and regulations; (ii) the Contractual Arrangements are valid and binding, and do not result in any violation of PRC laws or regulations currently in effect; and (iii) the business operations of Park Ha Jiangsu and the VIEs are in compliance with existing PRC laws and regulations in all material respects.

However, there are substantial uncertainties regarding the interpretation and application of current and future PRC laws and regulations. Accordingly, the Company cannot be assured that PRC regulatory authorities will not ultimately take a contrary view to the foregoing opinion of its management. If the current corporate structure of the Company or the Contractual Arrangements is found to be in violation of any existing or future PRC laws and regulations, the Company may be required to restructure its corporate structure and operations in the PRC to comply with changing and new PRC laws and regulations. In the opinion of management, the likelihood of loss in respect of the Company's current corporate structure or the Contractual Arrangements is remote based on current facts and circumstances.

 

**NOTE 21— SUBSEQUENT EVENTS**

On November 27, 2025 , Hefeng Beauty Salon ("hefeng") was incorporated in the People's Republic of China ("PRC") and is controlled by Park Ha Jiangsu through contractual arrangement as its variable interest entity ("VIE").

On December 3, 2025, the Company incorporated Wuxishi Maohe Biotechnology Co., Ltd., a limited liability company，100% owned by Xinzhan.

On November 15, 2025, the Company signed a lease agreement with Wuxi Suning Commercial Management Co., Ltd. The Company leased Shop 503 in Suning Plaza, located at 111 Renmin Middle Road, Chongan District, Wuxi City, covering an area of 48 square meters. The lease term is from November 21, 2025, to November 20, 2027. The total rent is $1,845, with $8,587 for the first year and $9,864 for the second year.

On December 1, 2025, the company signed a lease agreement with Wuxi Yinggeka Shopping Center Co., Ltd. The company leased Shop No. 04H15 located at No. 3 Tuanjie Middle Road, Xishan Economic Development Zone, Wuxi City, covering an area of 44 square meters. The lease term is from December 6, 2025 to December 5, 2027. The total rent is $13,133, with $6,455 for the first year and $6,478 for the second year.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 21— SUBSEQUENT EVENTS** (cont.)

On December 26, 2025, at the 2025 extraordinary general meeting of shareholders (the "EGM") of the Company, the shareholders of the Company passed resolutions to (i) increase the Company's authorized share capital; and (ii) adopt amended and restated memorandum and articles of association to reflect the share capital increase. As a result, immediately following the EGM, the Company's authorized share capital was increased from US$300,000 divided into 12,000,000,000 Class A Ordinary Shares of par value US$0.00002 each, with each Class A Ordinary Share entitled to one vote, and 3,000,000,000 Class B Ordinary Shares of par value US$0.00002 each, with each Class A Ordinary Share entitled to 20 votes, to US$3,000,000 divided into 120,000,000,000 Class A Ordinary Shares of par value US$0.00002 each, with each Class A Ordinary Share entitled to one vote, and 30,000,000,000 Class B Ordinary Shares of par value US$0.00002 each, with each Class B Ordinary Share entitled to 20 votes.

On January 28, 2026, the Company completed a public offering, issued and sold 21,875,000 Ordinary Shares, of which 21,875,000 shares related to the public offering, at $0.112 per share for $2.45 million. The net proceeds of $2.244 million after deducting underwriting discounts and the offering expenses payable was received by the Company. The Company also registering 196,875,000 Class A Ordinary Shares underlying the Warrants (the "Warrant Shares") pursuant to a zero-exercise price option. Each Warrant will have an initial exercise price of $0.112 per Class A Ordinary Share and will be exercisable beginning on the date of the issuance date and ending on the one-year anniversary of the issuance date.

On January 27, 2026, one holder exercised its 36,000 Warrant Shares through an alternative cashless exercise option, and the Company issued a total of 36,000 Class A Ordinary Shares on January 30, 2026.

On February 3, 2026, one holder exercised its 32,000 Warrant Shares through an alternative cashless exercise option, and the Company issued a total of 32,000 Class A Ordinary Shares on February 4, 2026.

On February 4, 2026, eleven holders exercised an aggregate of 900,000 Warrant Shares through an alternative cashless exercise option, and the Company issued a total of 900,000 Class A Ordinary Shares on February 4, 2026.

On February 5, 2026, one holder exercised its 12,379 Warrant Shares through an alternative cashless exercise option, and the Company issued a total of 12,379 Class A Ordinary Shares on February 5, 2026.

On February 23, 2026, eleven holders exercised an aggregate of 1,125,121 Warrant Shares through an alternative cashless exercise option, and the Company issued a total of 1,125,121 Class A Ordinary Shares on February 23, 2026.

On February 9, 2026, the Company announced that it expects to implement a 1-for-50 reverse stock split effective February 20, 2026, subject to the Company's satisfaction of Nasdaq Operations notice requirements, with trading to begin on a split-adjusted basis at the market open on that day.

In connection with the reverse stock split, the Company filed an Amended and Restated Memorandum of Association, with the Registry of Companies of the Cayman Islands on February 4, 2026 to reduce the authorized share capital of the Company from USD 3,000,000.00 divided into 150,000,000,000 ordinary shares of par value US$0.00002 each divided into (i) 120,000,000,000 Class A ordinary shares with a par value of US$0.00002 each with 1 vote per share and (ii) 30,000,000,000 Class B ordinary shares with a par value of US$0.00002 each with 20 votes per share to 3,000,000,000 ordinary shares of par value US$0.001 each divided into (i) 2,400,000,000 Class A ordinary shares with a par value of US$0.001 each with 1 vote per share and (ii) 600,000,000 Class B ordinary shares with a par value of US$0.001 each with 20 votes per share, the reduction at the same ratio as its reduction in the issued and outstanding shares. As approved and authorized by a majority of the shareholders at an extraordinary meeting of shareholders held on December 26, 2025, the Board of Directors of the Company subsequently approved the reverse stock split and the exact ratio of the reverse stock split on January 29, 2026.

The Company has evaluated subsequent events from October 31, 2025 and through the date of issuance of the consolidated financial statements which is March 02, 2026 and did not identify any subsequent events except disclosed above that would have material financial impact or that required adjustment of the Company's consolidated financial statements.

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 22 — PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION**

Park Ha Biological Technology Co., Ltd. ("Park Ha Cayman") was incorporated in the Cayman Islands on October 11, 2022.

The condensed parent company financial statements have been prepared in accordance with Rule 12-04, Schedule I of Regulation S-X, as the restricted net assets of the subsidiaries of Park Ha Cayman exceed 25% of the consolidated net assets of the Company. For purposes of the test, restricted net assets of consolidated subsidiaries shall mean that amount of the registrant's proportionate share of net assets of consolidated subsidiaries (after intercompany eliminations) which as of the end of the most recent fiscal year may not be transferred to the parent company by subsidiaries in the form of loans, advances or cash dividends without the consent of a third party (i.e., lender, regulatory agency, foreign government, etc.). The ability of the Company's Chinese operating subsidiaries to pay dividends may be restricted due to the foreign exchange control policies and availability of cash balances of the Chinese operating subsidiaries. Because substantially all of the Company's operations are conducted in China and a substantial majority of the Company's revenues are generated in China, a majority of the Company's revenue being earned and currency received are denominated in Renminbi ("RMB"). RMB is subject to the exchange control regulation in China, and, as a result, the Company may be unable to distribute any dividends outside of China due to PRC exchange control regulations that restrict the Company's ability to convert RMB into US Dollars.

The condensed parent company financial statements have been prepared using the same accounting principles and policies described in the notes to the consolidated financial statements, with the only exception being that the parent company accounts for its subsidiaries using the equity method, and are presented as if all the companies existed as of November 1, 2022 and throughout the three-year periods ended October 31, 2025. Refer to the consolidated financial statements and notes presented above for additional information and disclosures with respect to these financial statements.

As of October 31, 2025 and 2024, there were no material contingencies, significant provisions of long-term obligations, mandatory dividend or redemption requirements of redeemable stock or guarantees of the Company, except for those that have been separately disclosed in the consolidated financial statements, if any.

*Condensed Balance Sheets*

---

| | | |
|:---|:---|:---|
|  | **October 31, <br> 2025** | **October 31, <br> 2024** |
| **ASSETS** | | |
| **Current Assets** |  |  |
| **Cash** | 2056270 |  |
| Other receivables and other current assets | 293333 |  |
| Deffered IPO Cost |  | 1088400 |
| **Total Current Assets** | 2349603 | 1088400 |
| **Non-Current Assets** |  |  |
| Investment in subsidiaries and VIEs | 3716103 | 1879477 |
| **Total Non-Current Assets** | 3716103 | 1879477 |
| **TOTAL ASSETS** | 6065706 | 2967877 |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| **Current Liabilities** |  |  |
| Accruals and other payables | 60000 |  |
| Intercompany Payable | 2010851 | 1461792 |
| **Total Current Liabilities** | 2070851 | 1461792 |
| **TOTAL LIABILITIES** | 2070851 | 1461792 |
| **Shareholders' Equity** |  |  |
| Class A Ordinary Shares, $0.001 par value; 12,000,000,000 shares authorized; 296,488 and 119,000 shares issued and outstanding as of October 31, 2025 and 2024, respectively;\* | 296 | 119 |
| Class B Ordinary Shares, $0.001 par value; 3,000,000,000 shares authorized; 381,000 shares issued and outstanding as of October 31, 2025 and 2024, respectively\* | 381 | 381 |
| Subscription Receivable |  |  |
| Additional Paid In Capital | 28021581 | 1161211 |
| Statutory Reserve | 217264 | 131962 |
| (Accumulated Deficits) Retained Earning | (24178267) | 271788 |
| Accumulated Other Comprehensive Loss | (66400) | (59376) |
| **Total Stockholders' Equity** | 3994855 | 1506085 |
| **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | 6065706 | 2967877 |

---

\* Retroactively restated to reflect the share split and share reorganization(See Note 15)

**Park Ha Biological Technology Co., Ltd. and its Subsidiaries**

**Notes to the Consolidated Financial Statements**

**NOTE 22 — PARENT COMPANY ONLY CONDENSED FINANCIAL INFORMATION** (cont.)

*Condensed Statements of Operations*

 

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended<br> October 31,<br> 2025** | **Year Ended <br> October 31,<br> 2024** | **Year Ended <br> October 31,<br> 2023** |
| **Operating costs and expenses:** |  |  |  |
| General and administrative expenses | 24840917 | 373892 |  |
| Total operating expenses | 24840917 |  |  |
| Other income (expense): |  |  |  |
| Other income | 30002 |  |  |
| Interest income | 2552 |  |  |
| Interest expense | (41) |  |  |
| **Total other income (expenses)** | 32513 |  |  |
| Income of subsidiaries and VIEs | 443651 | 852453 | 852042 |
| Net (loss) income | (24364753) | 478561 | 852042 |

---

 

---

| | | | |
|:---|:---|:---|:---|
|  | **Year Ended<br> October 31,<br> 2025** | **Year Ended<br> October 31,<br> 2024** | **Year Ended<br> October 31,<br> 2023** |
| Cash flows from operating activities |  |  |  |
| &nbsp;&nbsp;&nbsp;Net (loss) income | (24364753) | 478561 | 852042 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based Compensation Expense | 24070200 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-cash operating expense | 150000 | 373892 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income of subsidiaries and VIEs | (443651) | (852453) | (852042) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other receivables and other current assets | (293333) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accruals and other payables | 60000 |  |  |
| Net cash used in operating activities | (821537) |  |  |
| Cash flows from investing activities |  |  |  |
| &nbsp;&nbsp;&nbsp;Pay the investments on behalf of the subsidiary | (1400000) |  |  |
| &nbsp;&nbsp;&nbsp;Loans to the third party | (6030001) |  |  |
| &nbsp;&nbsp;&nbsp;Loans repayment from the third party | 6030001 |  |  |
| Net cash used in investing activities | (1400000) |  |  |
| Cash flows from financing activities |  |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of shares | 4277807 |  |  |
| Net cash provided by financing activities | 4277807 |  |  |
| Net increase in cash | 2056270 |  |  |
| Effect of exchange rate changes on cash |  |  |  |
| Cash and cash equivalents– at the beginning of the year |  |  |  |
| Cash and cash equivalents– at the end of the year | $2056270 | $— | $— |

---

## Exhibit 2.1

**Exhibit 2.1**

**DESCRIPTION OF THE REGISTRANT'S SECURITIES** 

**REGISTERED PURSUANT TO SECTION 12 OF THE** 

**SECURITIES EXCHANGE ACT OF 1934**

As of the date of this annual report on Form 20-F of which this Exhibit 2.1 is a part, Park Ha Biological Technology Co., Ltd. (the "Company", "we", "us" or "our") has only one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended: the Company's Class A Ordinary Shares (the "Class A Ordinary Shares").

The following are summaries of the material provisions of our amended and restated memorandum and articles of association under the Cayman Islands Companies Act (As Revised), insofar as they relate to the material terms of our Class A Ordinary Shares.

**Our Memorandum and Articles** 

Copies of our amended and restated memorandum and articles of association are filed as exhibits.

 

*Ordinary Shares*

In connection with the reverse stock split, we filed a amended and restated memorandum and articles of association with the Registry of Companies of the Cayman Islands on February 4, 2026 to reduce the authorized share capital of the Company from USD 3,000,000.00 divided into divided into 150,000,000,000 ordinary shares of par value US$0.00002 each divided into (i) 120,000,000,000 Class A ordinary shares with a par value of US$0.00002 each with 1 vote per share and (ii) 30,000,000,000 Class B ordinary shares with a par value of US$0.00002 each with 20 votes per share to 3,000,000,000 ordinary shares of par value US$0.001 each divided into (i) 2,400,000,000 Class A ordinary shares with a par value of US$0.001 each with 1 vote per share and (ii) 600,000,000 Class B ordinary shares with a par value of US$0.001 each with 20 votes per share, the reduction at the same ratio as its reduction in the issued and outstanding shares. As approved and authorized by a majority of the shareholders of at an extraordinary meeting of shareholders held on December 26, 2025, the Board of Directors of the Company subsequently approved the reverse stock split and the exact ratio of the reverse stock split on January 29, 2026.

As of the date hereof, our authorized share capital is US$3,000,000 divided into 2,400,000,000 Class A Ordinary Shares of par value of US$0.001 each and 600,000,000 Class B Ordinary Shares of par value US$0.001 each. All of our shares to be issued in the offering will be issued as fully paid. Holders of Class A Ordinary Shares and Class B Ordinary Shares have the same rights except for voting and conversion rights. In respect of matters requiring a vote of all shareholders by way of poll, each holder of Class A Ordinary Shares will be entitled to one vote per one Class A Ordinary Share and each holder of Class B Ordinary Shares will be entitled to 20 votes per one Class B Ordinary Share. The Class A Ordinary Shares are not convertible into shares of any other class. The Class B Ordinary Shares are convertible into Class A Ordinary Shares at any time after issuance at the option of the holder on a one-to-one basis.

All of our issued and outstanding Class A Ordinary Shares and Class B Ordinary Shares are fully paid and non-assessable. Our Class A Ordinary Shares and Class B Ordinary Shares are issued in registered form, and are issued when registered in our register of members. Unless the board of directors determine otherwise, each holder of our Class A Ordinary Shares or Class B Ordinary Shares will not receive a certificate in respect of such shares. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their Class A Ordinary Shares and Class B Ordinary Shares. We may not issue shares to bearer.

Subject to the provisions of the Cayman Companies Act and our Articles regarding 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. Such authority could be exercised by the directors to allot shares which carry rights and privileges that are preferential to the rights attaching to Class A Ordinary Shares or Class B 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 Class A Ordinary Shares are listed on Nasdaq under the symbol "BYAH."

*Transfer Agent*

The transfer agent and registrar for our Ordinary Shares is Transhare Corporation.

 

*Dividends*

Subject to the provisions of the Cayman Islands Companies Act and the Articles, the directors may declare dividends or distributions out of our funds which are lawfully available for that purpose.

Under the laws of the Cayman Islands, our Company may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would result in our company being unable to pay its debts as they fall due in the ordinary course of business. The directors when paying dividends to shareholders may make such payment either in cash or in specie.

No dividend shall bear interest as against the Company.

 

*Voting Rights*

On a poll, every shareholder who is present in person and every person representing a shareholder by proxy shall have one vote for each Class A Ordinary Share and 20 votes for each Class B Ordinary Share of which he or the person represented by proxy is the holder. In addition, all shareholders holding shares of a particular class are entitled to vote at a meeting of the holders of that class of shares. Votes may be given either personally or by proxy.

 

*Conversion Rights*

Class A Ordinary Shares are not convertible. Class B Ordinary Shares are convertible, at the option of the holder thereof, into Class A Ordinary Shares on a one-to-one basis.

 

*Variation of Rights of Shares*

If at any time our share capital is divided into different classes of shares, the rights attached to any class (unless otherwise provided by the terms of issue of the shares of that class) may be varied either (a) by, or with the approval of, the directors without the consent of the holders of the shares of the affected class if the directors determine that the variation or abrogation is not materially adverse to the interests of those shareholders, or (b) with the consent in writing of the holders of two-thirds of the issued shares of that class, or with the sanction of a special resolution passed at a separate general meeting of the holders of that class of share, provided that the necessary quorum for such meeting shall be one or more persons holding or representing by proxy one-third of the issued shares of the class, and at which any holder of shares of the class present in person or by proxy may demand a poll.

Unless otherwise expressly provided by the terms of issue of any class, the rights conferred on the holders of shares of that class shall not be deemed to be varied by the creation or issue of further shares ranking pari passu with that class.

 

*Alteration of Share Capital*

Subject to the Cayman Islands Companies Act, our shareholders may, by ordinary resolution:

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

&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;(c) subject
to the Cayman Islands Companies Act, sub-divide our shares or any of them into shares of smaller amounts than that fixed; and

&nbsp;&nbsp;&nbsp;&nbsp;(d) cancel
any shares which, at the date of the passing of that ordinary resolution, have not been taken or agreed to be taken by any person.

Subject to the Cayman Islands Companies Act and the Articles, we may, by special resolution of our shareholders, reduce the share capital of the Company and any capital redemption reserve in any manner.

 

*Calls on Shares and Forfeiture*

The directors may, from time to time, make calls on the shareholders in respect of some or all of any monies unpaid on their shares, whether in respect of par value or the premium payable on those shares, and each shareholder shall (subject to receiving at least 14 days' notice specifying the time or times of payment), pay to us at the time or times so specified the amount called on his shares. The directors may revoke or postpone a call at any time. The joint holders of a share shall be jointly and severally liable to pay all calls in respect of the share and the holder or joint holders of a share at the time of a call shall remain liable to pay the call on that share, notwithstanding any subsequent transfer of the share being registered by the Company. If a sum called in respect of a share is not paid before or on the day appointed for payment of that call, the shareholder from whom it is due and payable shall pay interest on the sum at such rate as the directors may determine from the day appointed for payment of the call to the time of the actual payment. The directors may, at their discretion, waive payment of the interest in full or in part.

We have a first and paramount lien on every share (whether or not it is a fully paid share). The lien is for all monies, whether presently payable or not, called or payable at a fixed time in respect of that share and for all debts, liabilities or other obligations owed, whether presently or not, by the shareholder or by one or more joint shareholders or by any of their estates to the Company.

At any time, the directors may declare any share to be wholly or in part exempt from the lien on shares provisions of the Articles. Our lien, if any, on a share shall extend to all distributions payable on it.

 

*Unclaimed Dividend*

Any dividend that remains unclaimed after a period of six years from the date of declaration of such dividend shall be forfeited and revert to the Company.

 

*Forfeiture or Surrender of Shares*

If a shareholder fails to pay any call or instalment of a call in respect of shares on the day appointed for payment, the directors may serve a notice on such shareholder naming a further date not earlier than the expiration of 14 days from the date of service on or before which the payment required by the notice is to be made and containing a statement that in the event of non-payment the shares, or any of them, will be liable to be forfeited.

If the requirements of such notice are not complied with, we may forfeit the shares together with any distributions declared payable in respect of the forfeited shares and not paid at any time before tender of payment.

A forfeited share may be sold or otherwise disposed of on such terms and in such manner as the directors think fit, and at any time before a sale or disposition the forfeiture may be cancelled on such terms as the directors think fit. The proceeds of any sale or disposition of the forfeited Share may be received and used by us as the directors determine.

A person whose shares have been forfeited shall cease to be a shareholder in respect of the forfeited shares, but shall, notwithstanding such forfeit, 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 interest.

 

*Share Premium Account*

The directors shall establish a share premium account and shall carry the credit of such account from time to time to a sum 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 Islands Companies Act.

 

*Redemption and Purchase of Own Shares*

Subject to the Cayman Islands Companies Act and to the rights attaching to any class of shares, we may by our directors:

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

&nbsp;&nbsp;&nbsp;&nbsp;(b) purchase
our own shares (including any redeemable shares) on such terms and in such manner as the directors determine;

&nbsp;&nbsp;&nbsp;&nbsp;(c) make
a payment in respect of the redemption or purchase of its own Shares in any manner permitted by the Companies Act including out of capital;
and

&nbsp;&nbsp;&nbsp;&nbsp;(d) permit
the surrender of fully paid Shares for no consideration.

When making payments in respect of redemption or purchase of shares, the directors may make such payments in cash or in kind if so authorized by the terms of issue of those shares or with the agreement of the holder of those shares.

 

*Transfer of Shares*

The transferor shall be deemed to remain the holder of an ordinary share until the name of the transferee is entered on the register of members of the Company.

Where the shares in question are not listed on or subject to the rules of Nasdaq, shares are transferable, subject to the consent of our board of directors who may, in their absolute discretion, refuse to consent to any transfer and decline to register the transfer without giving any reason.

If our directors refuse to register a transfer of a share, they are required, within two months after the date on which the transfer was lodged, to notify the transferee of the refusal.

 

*Inspection of Books and Records*

Holders of our Ordinary Shares will have no general right under the Cayman Islands Companies Act to inspect or obtain copies of our register of members or our corporate records. Under Cayman Islands law, the names of our current directors can generally be obtained from a search conducted at the Registrar of Companies of the Cayman Islands.

 

 

*General Meetings*

All general meetings other than annual general meetings shall be called extraordinary general meetings. We may but are not obliged to hold an annual general meeting.

Any director may convene general meetings at such times and in such manner and places within or outside the Cayman Islands as the director considers necessary or desirable. General meetings shall also be convened by any one or more of our directors on the written request of shareholders entitled to exercise 10% or more of the voting rights in respect of the matter for which the meeting is requisitioned. Such written request must state the objects of the meeting and must be signed by the shareholders requisitioning the meeting. The written request must be lodged at our registered office in the Cayman Islands and may be delivered in counterpart. If the directors do not proceed to convene a general meeting within 21 days of the written request to requisition a meeting being lodged the requisitionists, or any of them together holding at least half of the voting rights of all of them, may convene the general meeting in the same manner as nearly as possible as that in which a general meeting may be convened by a director. Where the requisitionists fail to convene the general meeting within three months of their right to convene the meeting arising, the right to convene the general meeting shall lapse.

The director convening a general meeting shall give not less than seven days' notice of a general meeting to those shareholders whose names on the date the notice is given appear as members in our register of members and are entitled to vote at the meeting. Such director shall also give such notice to each of the directors.

A general meeting held in contravention of the requirement to give notice is valid if shareholders holding at least 90% of the total voting rights on all the matters to be considered at the meeting have waived notice of the meeting and, for this purpose, the presence of a shareholder at the meeting shall constitute waiver in relation to all the shares which that shareholder holds.

A general meeting is duly constituted if, at the commencement of the meeting, there are present in person, through their authorized representative or by proxy not less than 30% of the votes of shares entitled to vote on resolutions of shareholders to be considered at the meeting. Where a quorum comprises a single shareholder or proxy, such person may pass a resolution of shareholders and a certificate signed by such person accompanied where such person be a proxy by a copy of the proxy instrument shall constitute a valid resolution of shareholders.

If, within two hours from the time appointed for the general meeting, a quorum is not present, the meeting, if convened upon the requisition of shareholders, shall be dissolved. In any other case it shall stand adjourned to the next business day in the jurisdiction in which the meeting was to have been held at the same time and place or to such other time and place as the directors may determine, and if at the adjourned meeting a quorum is not present within half an hour from the time appointed for the meeting the shareholders present shall be a quorum.

The chairman may, with the consent of the meeting at which a quorum is present, adjourn any meeting from time to time, and from place to place, but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.

At any general meeting the chairman is responsible for deciding in such manner as considered appropriate whether any resolution proposed has been carried or not and the result of the decision shall be announced to the meeting and recorded in the minutes of the meeting. If the chairman has any doubt as to the outcome of the vote on a proposed resolution, he shall cause a poll to be taken of all votes cast upon such resolution and the result shall be announced to the meeting and recorded in the minutes of the meeting. The minutes of the meeting shall be conclusive evidence of the fact that a resolution was carried or not without proof of the number or proportion of the votes recorded in favor of or against such resolution.

 

*Preferred Shares*

Pursuant to our amended and restated memorandum and articles of association, our directors have the authority to issue shares and other securities of the Company with such preferred, deferred or other special rights, restrictions or privileges whether with regard to voting, distributions, a return of capital, or otherwise and in such classes and series, if any, as the directors may determine. We do not currently have plans to issue any preferred shares.

 

 

*Directors*

We may by ordinary resolution impose a maximum or minimum number of directors required to hold office at any time and vary such limits from time to time. Under the Articles, we are required to have a minimum of one director.

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.

The directors shall be entitled to such remuneration as the directors may determine.

We may in general meeting fix a minimum shareholding required to be held by a director, but unless and until so fixed a director is not required to hold shares.

A director may be removed by ordinary resolution or by a resolution of our directors.

Subject to the provisions of the articles, the office of a director shall be vacated if:

&nbsp;&nbsp;&nbsp;&nbsp;(a) he
gives notice in writing to the Company that he resigns the office of director; or

&nbsp;&nbsp;&nbsp;&nbsp;(b) he
absents himself (without being represented by an alternate director appointed by him) from three consecutive meetings of the board of
directors without special leave of absence from the directors, and they pass a resolution that he has by reason of such absence vacated
office; or;

&nbsp;&nbsp;&nbsp;&nbsp;(c) he
dies, becomes bankrupt or makes any arrangement or composition with his creditors generally;

&nbsp;&nbsp;&nbsp;&nbsp;(d) he
is found to be or becomes of unsound mind; or

&nbsp;&nbsp;&nbsp;&nbsp;(e) all
the other directors (being not less than two in number) resolve that he should be removed as a director;

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 the Nasdaq corporate governance rules. The audit committee shall consist of at least three directors, all of whom shall be independent within the meaning of the Nasdaq corporate governance rules and will meet the criteria for independence set forth in Rule 10A-3 or Rule 10C-1 of the Exchange Act.

 

*Powers and Duties of Directors*

Subject to the provisions of the Cayman Islands Companies Act and our amended and restated memorandum and articles and any directions given by ordinary resolution, our business and affairs shall be managed by, or under the direction or supervision of, the directors. The directors shall have all the powers necessary for managing, and for directing and supervising, our business and affairs of the Company as are not by the Cayman Islands Companies Act, our amended and restated memorandum and articles or the terms of any special resolution required to be exercised by the shareholders. No alteration of our amended and restated memorandum and articles or any direction given by ordinary or special resolution shall invalidate any prior act of the directors that was valid at the time undertaken.

The directors may delegate any of their powers to any committee consisting of one or more directors. They may also delegate to any managing director or director holding any other executive office such of their powers as they consider desirable to be exercised by him provided that an alternate director may not act as managing director and the appointment of a managing director shall automatically terminate if he ceases to be a director. Any such delegation may be made subject to any conditions the directors may impose and may be revoked or altered. Subject to any such conditions, the proceedings of a committee of directors shall be governed by the Articles regulating the proceedings of directors, so far as they are capable of applying.

The directors may establish any committees, local boards or agencies or appoint any person to be a manager or agent for managing the affairs of the Company and may appoint any person to be a member of such committees or local boards. Any such appointment may be made subject to any conditions the directors may impose, and may be revoked or altered. Subject to any such conditions, the proceedings of any such committee, local board or agency shall be governed by the Articles regulating the proceedings of directors, so far as they are capable of applying.

The directors may by power of attorney or otherwise appoint any company, firm, person or body of persons, whether nominated directly or indirectly by the directors, to be the attorney or authorized signatory of the Company for such purpose and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the directors under the Articles) and for such period and subject to such conditions as they may think fit, and any such powers of attorney or other appointment may contain such provisions for the protection and convenience of persons dealing with any such attorneys or authorized signatories as the directors may think fit and may also authorize any such attorney or authorized signatory to delegate all or any of the powers, authorities and discretions vested in him.

The directors may appoint such officers as they consider necessary on such terms, at such remuneration and to perform such duties, and subject to such provisions as to disqualification and removal as the directors may think fit. Unless otherwise specified in the terms of his appointment an officer may be removed by the directors.

The directors may exercise all the powers of the Company to incur indebtedness, liabilities or obligations and to issue debentures, debenture stock, mortgages, bonds and other such securities and to secure indebtedness, liabilities or obligations whether of the Company or of any third party.

No person shall be disqualified from the office of director or alternate director or prevented by such office from contracting with the Company, either as vendor, purchaser or otherwise, nor shall any such contract or any other contract or transaction entered into by or on behalf of the Company in which any director or alternate director shall be in anyway interested be or be liable to be avoided, nor shall any director or alternate director so contracting or being so interested be liable to account to the Company for any profit realized by any such contract or transaction by reason of such director holding office or of the fiduciary relation thereby established. A director (or his alternate director in his absence) shall be at liberty to vote in respect of any contract or transaction in which he is interested provided that the nature of the interest of any director or alternate director in any such contract or transaction shall be disclosed by him at or prior to its consideration and any vote thereon. A general notice that a director or alternate director is a shareholder, director, officer or employee of any specified firm or company and is to be regarded as interested in any transaction with such firm or company shall be sufficient disclosure for the purposes of voting on a resolution in respect of a contract or transaction in which he has an interest, and after such general notice it shall not be necessary to give special notice relating to any particular transaction.

*Capitalization of Profits*

The directors may capitalize any sum standing to the credit of any of the Company's reserve accounts (including share premium account and capital redemption reserve) or to the credit of profit and loss account or otherwise available for distribution and appropriate such sum to shareholders in the proportions in which such sum would have been divisible amongst them had the same been a distribution of profits by way of dividend and apply such sum on their behalf in paying up in full unissued shares for issue, allotment and distribution credited as fully paid-up to and amongst them in the proportions aforesaid. In such event the directors may make such provisions as they think fit in the case of shares becoming distributable in fractions.

 

*Liquidation Rights*

The shareholders may, subject to the Articles and any other sanction required by the Cayman Islands Companies Act, pass a special resolution allowing the Company to be wound up voluntarily. If the Company shall be wound up, and the assets available for distribution amongst the shareholders shall be insufficient to repay the whole of the share capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the shareholders in proportion to the par value of the shares held by them. If in a winding up the assets available for distribution amongst the shareholders shall be more than sufficient to repay the whole of the share capital at the commencement of the winding up, the surplus shall be distributed amongst the shareholders in proportion to the par value of the shares held by them at the commencement of the winding up subject to a deduction from those shares in respect of which there are monies due, of all monies payable to the Company for unpaid calls or otherwise, without prejudice to the rights of holders of shares issued upon special terms and conditions.

 

 

*Register of Members*

Under the Cayman Islands Companies Act, we must keep a register of members and there should be entered therein:

● the names and addresses of our shareholders, together with a statement of the shares held by each shareholder, such statement shall confirm (i) the amount paid or agreed to be considered as paid, on the shares of each shareholder; (ii) the number and category of shares held by each member, and (iii) whether each relevant category of shares held by a member carries voting rights under the articles of association of the company, 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 shareholder; and

● the date on which any person ceased to be a shareholder.

Under the Cayman Islands 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 Islands 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 Islands Companies Act is derived, to a large extent, from the older Companies Acts of the United Kingdom but does not follow recent United Kingdom statutory enactments, and accordingly there are significant differences between the Cayman Islands Companies Act and the current Companies Act of the United Kingdom. In addition, the Cayman Islands 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 Islands Companies Act applicable to us and the laws applicable to companies incorporated in the State of Delaware in the United States.

 

*Mergers and Similar Arrangements*

The Cayman Islands Companies Act permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies provided that the laws of the foreign jurisdiction permit such merger or consolidation. For these purposes, (1) "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 (2) 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 (1) a special resolution of the shareholders of each constituent company, and (2) such other authorization, if any, as may be specified in such constituent company's articles of association. The written plan of merger or consolidation must be filed with the Registrar of Companies of the Cayman Islands 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 members 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 affected in compliance with these statutory procedures.

A merger between a Cayman parent company and its Cayman 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, the Cayman Islands Companies Act contains statutory provisions that facilitate the reconstruction of companies by way of schemes of arrangement, provided that the arrangement is approved by (a) at least a majority in number of the creditors or class of creditors, who must, in addition, represent at least three-fourths in value of each such creditors or class of creditors; and/or (b) shareholders or a class of shareholders representing at least three-fourths in value of the shareholders or class of shareholders, in each case that are 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 (the "Grand Court"). While a dissenting shareholder has the right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement if it determines that:

&nbsp;&nbsp;&nbsp;&nbsp;(a) the
statutory provisions as to the required majority vote have been met;

&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;(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;(d) the
arrangement is not one that would more properly be sanctioned under some other provision of the Cayman Islands Companies Act.

The Cayman Islands Companies Act also contains a statutory power of compulsory acquisition which may facilitate the "squeeze out" of dissentient minority shareholders upon a tender offer. When a tender offer is made and accepted by holders of 90.0% 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, 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.

 

 

*Shareholders' Suits and Protection of Minority Shareholders.*

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 Grand Court can be expected to follow and apply the common law principles (namely the rule derived from the seminal English case of *Foss v. Harbottle* and the exceptions thereto, which limits the circumstances in which a shareholder may bring a derivative action on behalf of the company or a personal action to claim loss which is reflective of loss suffered by the company) which permit a minority shareholder to commence a class action against, or derivative actions in the name of, a company to challenge the following acts in the following circumstances:

● a company acts or proposes to act illegally or ultra vires;

● the act complained of, although not ultra vires, could only be effected duly if authorized by more than a simple majority vote that has not been obtained; and

● those who control the company are perpetrating a "fraud on the minority."

In the case of a company (not being a bank) having its share capital divided into shares, the Grand Court may, on the application of members holding not less than one fifth of the shares of the company in issue, appoint an inspector to examine the affairs of the company and to report thereon in such manner as the Grand Court shall direct.

Any of our shareholders may petition the Grand Court which may make a winding up order if the Grand Court of the Cayman Islands is of the opinion that it is just and equitable that we should be wound up and cease doing business. Alternatively, the Grand Court may make an order: (1) regulating the conduct of our affairs; (2) requiring us to refrain from doing or continuing an act complained of by the shareholder petitioner or to do an act which the shareholder petitioner has complained we have omitted to do; (3) authorizing civil proceedings to be brought in our name and on our behalf by the shareholder petitioner on such terms as the Grand Court may direct; or (4) providing for the purchase of the shares of any of our shareholders by other shareholders or us and, in the case of a purchase by us, a reduction of our capital accordingly.

Generally, claims against us must be based on the general laws of contract or tort applicable in the Cayman Islands or individual rights as shareholders as established by our amended and restated memorandum and articles of association.

 

*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 the consequences of committing a crime, or against the indemnified person's own fraud or dishonesty. Our amended and restated memorandum and articles of association permit indemnification of officers and directors for liabilities incurred in their capacities as such as a result of any act or failure to act unless such losses or damages arise from their own actual fraud or willful default. This standard of conduct is generally the same as permitted under the Delaware General Corporation Law for a Delaware corporation.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

 

*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 acts in a manner he reasonably believes to be in the best interests of the corporation. He must not use his corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best interest 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, the 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, directors of a Cayman Islands company owe fiduciary duties to the company. Under Cayman Islands law, directors and officers owe the following fiduciary duties: (i) a duty to act in good faith in what the director or officer believes to be in the best interests of the company as a whole; (ii) a duty to exercise powers for the purposes for which those powers were conferred and not for a collateral purpose; (iii) a duty not to improperly fetter the exercise of future discretion; (iv) a duty to exercise powers fairly as between different classes of shareholders; (v) a duty to exercise independent judgment; and (vi) a duty not to put themselves in a position in which there is a conflict between their duty to the company and their personal interests. In fulfilling their duty of care to our company, our directors must ensure compliance with our amended and restated memorandum and articles of association, as amended and restated from time to time.

A director of a Cayman Islands company owes to the company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than may reasonably be expected from a person of his knowledge and experience. However, there are indications that English and Commonwealth courts are moving towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands.

 

*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 Islands 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 articles provide that general meetings may also be convened by any one or more of our directors on the written request of shareholders entitled to exercise 10% or more of the voting rights in respect of the matter for which the meeting is requisitioned. Such written request must state the objects of the meeting and must be signed by the shareholders requisitioning the meeting. The written request must be lodged at our registered office in the Cayman Islands and may be delivered in counterpart. If the directors do not proceed to convene a general meeting within 21 days of the written request to requisition a meeting being lodged the requisitionists, or any of them together holding at least half of the voting rights of all of them, may convene the general meeting in the same manner as nearly as possible as that in which a general meeting may be convened by a director. Where the requisitionists fail to convene the general meeting within three months of their right to convene the meeting arising, the right to convene the general meeting shall lapse. As a Cayman Islands exempted company, we are not obligated by law to call shareholders' annual general meetings.

 

*Cumulative Voting*

Under the Delaware General Corporation Law, cumulative voting for election 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 Islands Companies Act, our 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.

 

*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 articles (which include the removal of a director by ordinary resolution), the office of a director may be vacated if: (a) he gives notice in writing to the Company that he resigns the office of director; or (b) he absents himself (without being represented by an alternate director appointed by him) from three consecutive meetings of the board of directors without special leave of absence from the directors, and they pass a resolution that he has by reason of such absence vacated office; or; (c) dies, becomes bankrupt or makes any arrangement or composition with his creditors generally; (d) he is found to be or becomes of unsound mind; or; (e) the other directors (being not less than two in number) resolve that he should be removed as a director.

 

*Transactions with Interested Shareholders*

The Delaware General Corporation Law contains a business combination statute applicable to Delaware 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 Companies Act 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 Islands 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.

 

*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 Islands Companies Act and our articles, the Company may be wound up by a special resolution of our shareholders, or if the winding up is initiated by our board of directors, by either a special resolution of our members 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.

 

*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 Islands Companies Act and our 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 either with the consent in writing of the holders of not less than two-thirds of the issued shares of that class, or 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.

 

*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 Islands Companies Act, our articles may only be amended by special resolution of our shareholders.

## Exhibit 8.1

**Exhibit 8.1**

**Subsidiaries of Park Ha Biological Technology Co., Ltd.**

The following is a list of subsidiaries of the Registrant.

---

| | |
|:---|:---|
| **Business Entity Name** | **Place of Formation** |
| Park Ha Biological Technology (HK) Co, Ltd. | Hong Kong |
| Park Ha Investment (Wuxi) Co., Ltd. | People's Republic of China |
| Jiangsu Park Ha Biological Technology Co., Ltd. | People's Republic of China |
| Wuxi Xinzhan Enterprise Management Consulting Co., Ltd. | People's Republic of China |
| Shanghai Park Ha Industrial Development Co., Ltd. | People's Republic of China |
| Wuxi Muchen Biotechnology Co., Ltd. | People's Republic of China |
| Wuxi Mufeng Biotechnology Co., Ltd. | People's Republic of China |
| Wuxi Maohe Biotechnology Co., Ltd. | People's Republic of China |

---

## Exhibit 12.1

**Exhibit 12.1**

**CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 302 OF THE**

**SARBANES-OXLEY ACT OF 2002**

I, Xiaoqiu Zhang, certify that:

1. I have reviewed this annual report on Form 20-F of Park Ha Biological Technology Co., Ltd. (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: March 2, 2026

---

| | | |
|:---|:---|:---|
| By: | /s/ Xiaoqiu Zhang | /s/ Xiaoqiu Zhang |
|  | Name: | Xiaoqiu Zhang |
|  | Title: | Chief Executive Officer |

---

## Exhibit 12.2

**Exhibit 12.2**

**CERTIFICATION OF THE CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 302 OF THE**

**SARBANES-OXLEY ACT OF 2002**

I, Xiaoyan Zhu, certify that:

1. I have reviewed this annual report on Form 20-F of Park Ha Biological Technology Co., Ltd. (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: March 2, 2026

---

| | | |
|:---|:---|:---|
| By: | /s/ Xiaoyan Zhu | /s/ Xiaoyan Zhu |
|  | Name: | Xiaoyan Zhu |
|  | Title: | Chief Financial Officer |

---

## Exhibit 13.1

**Exhibit 13.1**

**CERTIFICATION OF THE CHIEF EXECUTIVE OFFICER PURSUANT TO SECTION 906 OF**

**THE SARBANES-OXLEY ACT OF 2002**

In connection with the Annual Report of Park Ha Biological Technology Co., Ltd. (the "Company") on Form 20-F for the year ended October 31, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Xiaoqiu Zhang, 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:

&nbsp;&nbsp;&nbsp;&nbsp;(1) The
Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

&nbsp;&nbsp;&nbsp;&nbsp;(2) The
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Company.

Date: March 2, 2026

---

| | | |
|:---|:---|:---|
| By: | /s/ Xiaoqiu Zhang | /s/ Xiaoqiu Zhang |
|  | Name: | Xiaoqiu Zhang |
|  | Title: | Chief Executive Officer |

---

## Exhibit 13.2

**Exhibit 13.2**

**CERTIFICATION OF THE CHIEF FINANCIAL OFFICER PURSUANT TO SECTION 906 OF**

**THE SARBANES-OXLEY ACT OF 2002**

In connection with the Annual Report of Park Ha Biological Technology Co., Ltd. (the "Company") on Form 20-F for the year ended October 31, 2025, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Xiaoyan Zhu, Chief Financial 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:

&nbsp;&nbsp;&nbsp;&nbsp;(1) The
Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

&nbsp;&nbsp;&nbsp;&nbsp;(2) The
information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the
Company.

Date: March 2, 2026

---

| | | |
|:---|:---|:---|
| By: | /s/ Xiaoyan Zhu | /s/ Xiaoyan Zhu |
|  | Name: | Xiaoyan Zhu |
|  | Title: | Chief Financial Officer |

---

## Exhibit 15.1

**Exhibit 15.1**

![](ea0227833401_ex15-1img1.jpg)

**<u>Consent of Independent Registered Public Accounting Firm</u>**

We hereby consent to the incorporation by reference in the Registration Statement on Form F-1 (File No. 333-281783), Form S-8 (File No. 333-285482) and Form S-8 (File No. 333-288601), as amended, of our report dated March 2, 2026 with respect to the consolidated balance sheets of Park Ha Biological Technology Co., Ltd and its subsidiaries as of October 31, 2025, and the related consolidated statements of operation and comprehensive income (loss), changes in shareholders' equity, and cash flows for the fiscal year ended October 31, 2025, and the related notes included in the Annual Report on Form 20-F for the fiscal year ended October 31, 2025.

We also consent to the reference to our firm under the heading "Experts" in such Registration Statement.

---

| | |
|:---|:---|
|  | /s/ WWC, P.C. |
| San Mateo, California | WWC, P.C. |
| March 2, 2026 | Certified Public Accountants |
|  | PCAOB ID: 1171 |

---

![](ea0227833401_ex15-1img2.jpg)