# EDGAR Filing Document

**Accession Number:** 0001939780
**File Stem:** 0001213900-26-027794
**Filing Date:** 2026-3
**Character Count:** 1222260
**Document Hash:** b8b3cf131bef1fdc990f2efbfe3042ed
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-26-027794.hdr.sgml**: 20260316

**ACCESSION NUMBER**: 0001213900-26-027794

**CONFORMED SUBMISSION TYPE**: F-1/A

**PUBLIC DOCUMENT COUNT**: 10

**FILED AS OF DATE**: 20260316

**DATE AS OF CHANGE**: 20260313

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** U Power Ltd
- **CENTRAL INDEX KEY:** 0001939780
- **STANDARD INDUSTRIAL CLASSIFICATION:** MOTOR VEHICLE PARTS & ACCESSORIES [3714]
- **ORGANIZATION NAME:** 04 Manufacturing
- **EIN:** 000000000
- **STATE OF INCORPORATION:** E9
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** F-1/A
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-294161
- **FILM NUMBER:** 26753756

**BUSINESS ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 2F, ZUOAN 88 A, LUJIAZUI
- **CITY:** SHANGHAI
- **PROVINCE COUNTRY:** F4
- **BUSINESS PHONE:** 0086-21-6859-3598

**MAIL ADDRESS:**
- **ADDRESS IS A NON US LOCATION:** YES
- **STREET 1:** 2F, ZUOAN 88 A, LUJIAZUI
- **CITY:** SHANGHAI
- **PROVINCE COUNTRY:** F4

**As filed with the U.S. Securities and Exchange Commission on March 13, 2026.**

 **Registration No. 333-294161**

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

 **AMENDMENT NO. 1**

 **TO**

**Form F-1**

**REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933**

**U Power Limited**

(Exact name of Registrant as specified in its charter)

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|:---|:---|:---|
| **Cayman Islands** | **5500** | **Not Applicable** |
| (State or other jurisdiction of<br> incorporation or organization) | (Primary Standard Industrial<br> Classification Code Number) | (I.R.S. Employer<br> Identification Number) |

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**18/F, Building 3, Science and Technology Industrial Park**

**Yijiang District, Wuhu City, Anhui Province**

**People's Republic of China, 241003**

**Tel: 0086-21-6859-3598**<br> (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices)

**Cogency Global Inc.<br> 122 East 42<sup>nd</sup> Street, 18<sup>th</sup> Floor<br> New York, NY 10168<br> Telephone: (800) 221-0102**

(Name, address, including zip code, and telephone number, including area code, of agent for service)

***Copies to:***

 ****

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| | |
|:---|:---|
| **Ying Li, Esq.<br> Lisa Forcht, Esq.<br> Hunter Taubman Fischer & Li LLC<br> 950 Third Avenue, 19<sup>th</sup> Floor<br> New York, NY 10022<br> 212-530-2206** | **Barry I. Grossman, Esq.**<br> **Matthew Bernstein, Esq.**<br> **Ellenoff Grossman & Schole LLP**<br> **1345 Avenue of the Americas, 11th Floor**<br> **New York, NY 10105**<br> **Telephone: 212-370-1300** |

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Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are being offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.

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 7(a)(2)(B) of the Securities 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.

**The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the U.S. Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine.**

**The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.**

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|:---|:---|
| **SUBJECT TO COMPLETION** | **PRELIMINARY PROSPECTUS DATED March 13, 2026** |

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 **9,090,909 Units, Each Unit Consisting of One Class A Ordinary Share or One Pre-funded Warrant to Purchase<br> One Class A Ordinary Share and One Class A Warrant to Purchase One Class A Ordinary Share**

 **Up to 9,090,909 Class A Ordinary Shares Underlying the Pre-funded Warrants** 

 **Up to 36,363,636 Class A Ordinary Shares Underlying the Class A Warrants (which includes a zero exercise price option)**

**U Power Limited**

This is a firm-commitment underwritten public offering of 9,090,909 units (each, a "Unit," and collectively, the "Units"), each Unit consisting of one Class A ordinary share, par value $0.00001 per share (each, a "Class A Ordinary Share," and collectively, the "Class A Ordinary Shares") or one pre-funded warrant to purchase one Class A Ordinary Share (each, a "Pre-funded Warrant," and collectively, the "Pre-funded Warrants"), and one Class A warrant (each, a "Warrant," and collectively, the "Warrants") to purchase one Class A Ordinary Share, at an assumed public offering price of $0.66 per Unit, based upon the closing price of our Class A Ordinary Shares on the Nasdaq Capital Market on March 11, 2026. The actual public offering price per Unit to investors in this offering will be equal to the Nasdaq Official Closing Price of our Class A Ordinary Shares immediately preceding the effectiveness of the registration statement of which this prospectus forms a part **.**

The Units have no stand-alone rights and will not be certificated or issued as stand-alone securities. Each Warrant will be immediately exercisable upon issuance, subject to certain beneficial ownership limitations, at an assumed initial exercise price of $0.66 per Class A Ordinary Share (100% of the public offering price of each Unit in this offering) and will expire one (1) year after the issuance date. Subject to certain conditions, the exercise price for the Warrants will be adjusted downward on each of the 2<sup>nd</sup> and 5<sup>th</sup> trading day following the closing of this offering (each, a "Reset Date") to the price that is equal to 70% and 50%, respectively, of the initial exercise price (each, a "Reset Price"), and the number of Class A Ordinary Shares underlying the Warrants will be proportionally increased, as further described herein. The Warrants also contain certain mechanisms for cashless exercise, including a zero cash exercise option pursuant to which holders of the Warrants have the option, upon exercise and for no additional cash consideration, to receive an aggregate number of Class A Ordinary Shares equal to the product of (x) the aggregate number of Class A Ordinary Shares that would be issuable upon a cash exercise of the Warrant and (y) 2.0. Accordingly, we believe it is highly unlikely that a holder of the Warrants would pay an exercise price in cash to receive Class A Ordinary Shares when the holder could instead choose the zero cash exercise option and pay no additional cash to receive more Class A Ordinary Shares than they would receive if they paid the exercise price. As a result, we will likely not receive any additional funds and do not expect to receive any additional funds upon the exercise of the Warrants. Please see the section of this prospectus entitled "Description of the Securities We are Offering" for further information.

As an example, for each Unit that an investor purchases in this offering at the assumed offering price of $0.66 per Unit, the investor will receive one Class A Ordinary Share and one Warrant to purchase one Class A Ordinary Share at an assumed exercise price of $0.66 per Class A Ordinary Share. Giving effect solely to the adjustment on the first Reset Date and not giving effect to the zero cash exercise option, on the first Reset Date, each Warrant will become exercisable for a maximum of 1.43 Class A Ordinary Shares at an exercise price of $0.462 per Class A Ordinary Share, assuming the public offering price per Unit is equal to the closing price of our Class A Ordinary Shares on the Nasdaq Capital Market immediately prior to the effectiveness of the registration statement of which this prospectus forms a part. If such Warrant is then exercised at such time based on the zero cash exercise option, the Warrant would be exercisable into 2.86 Class A Ordinary Shares. If the Warrant remains outstanding as of the second Reset Date, giving effect solely to the potential adjustment on the second Reset Date and not giving effect to the zero cash exercise option, on the second Reset Date, each Warrant will become exercisable for a maximum of two Class A Ordinary Shares at an exercise price of $0.33 per Class A Ordinary Share. If such Warrant is then exercised at such time based on the zero cash exercise option, the Warrant would be exercisable into four Class A Ordinary Shares. Accordingly, if all of the Warrants offered to investors in this offering are exercised on a zero cash basis, a maximum of 36,363,636 Class A Ordinary Shares could be issued upon such zero cash exercise, without payment to the Company of any additional cash. For the avoidance of doubt, the lower the closing price of our Class A Ordinary Shares on the Nasdaq Capital Market immediately prior to the effectiveness of the registration statement of which this prospectus forms a part (which will not be more than the public offering price per Unit in this offering), the more Class A Ordinary Shares that will be issuable pursuant to the Warrants as a result of each reset (subject to the restriction that in no event shall the exercise price of the Warrants be reduced on such reset dates below a floor price of the greater of (i) $0.10 and (ii) 20% of the closing bid price of the Class A Ordinary Shares on the date prior to the execution of the underwriting agreement entered into in connection with this offering). As a result, the number of shares issuable upon a zero cash exercise of the Warrants could substantially increase relative to the assumed pricing described in this example if our stock price declines prior to the effectiveness of this registration statement. In addition, we have granted the Representative an option exercisable within 45 days of the date of this prospectus to purchase from us up to 1,363,636 additional Class A Ordinary Shares and/or up to 1,363,636 Warrants to cover over-allotments, if any. If the Representative's over-allotment option for Warrants is exercised in full to purchase 1,363,636 Warrants and all such Warrants are exercised on a zero cash basis, a maximum of 5,454,544 Class A Ordinary Shares could be issued upon such zero cash exercise without payment to the Company of any additional cash. If all of the Warrants offered to investors in this offering, including those subject to the Representative's over-allotment option for Warrants, are exercised on a zero cash basis, a maximum of 41,818,180 Class A Ordinary Shares could be issued upon such zero cash exercise without payment to the Company of any additional cash.

We are also offering to each purchaser of Units that would otherwise result in the purchaser's, together with its affiliates, beneficial ownership exceeding 4.99% (or, at the election of the purchaser, up to 9.99%) of our outstanding Class A Ordinary Shares immediately following the consummation of this offering, the opportunity to purchase Units consisting of one Pre-funded Warrant in lieu of one Class A Ordinary Share, and one Warrant. Each Pre-funded Warrant will be exercisable for one Class A Ordinary Share. Subject to limited exceptions, a holder of Pre-funded Warrants will not have the right to exercise any portion of its Pre-funded Warrants if the holder, together with its affiliates, would beneficially own in excess of 4.99% (or, at the election of the holder, up to 9.99%) of the number of Class A Ordinary Shares outstanding immediately after giving effect to such exercise. The purchase price of each Unit including a Pre-funded Warrant will be equal to the price per Unit including one Class A Ordinary Share, minus $0.001, and the exercise price of each Pre-funded Warrant will be $0.001 per Class A Ordinary Share. The Pre-funded Warrants will be immediately exercisable (subject to the beneficial ownership cap) and may be exercised at any time until all of the Pre-funded Warrants are exercised in full. For each Unit including a Pre-funded Warrant we sell (without regard to any limitation on exercise set forth therein), the number of Units including a Class A Ordinary Share we are offering will be decreased on a one-for-one basis.

We are registering the Class A Ordinary Shares issuable from time to time upon exercise of the Pre-funded Warrants and Warrants included in the Units offered hereby.

Our Class A Ordinary Shares are listed on the Nasdaq Capital Market ("Nasdaq") under the symbol "UCAR." On March 11, 2026, the last reported sale price of our Class A Ordinary Shares on the Nasdaq Capital Market was $0.66 per share. All Class A Ordinary Share, Pre-funded Warrant, and Warrant numbers are based on an assumed combined public offering price of $0.66 per Unit. The actual combined public offering price per Unit will be determined between us and the underwriters, based on market conditions at the time of pricing, and may be at a discount to the current market price of our Class A Ordinary Shares. Therefore, the assumed public offering price used throughout this prospectus may not be indicative of the final public offering price.

There is no established trading market for the Pre-funded Warrants or the Warrants, and we do not expect an active trading market to develop. We do not intend to list the Pre-funded Warrants or the Warrants on any securities exchange or other trading market. Without an active trading market, the liquidity of these securities will be limited.

We have a dual-class voting structure consisting of Class A Ordinary Shares and Class B ordinary shares (each, a "Class B Ordinary Share," and collectively, "Class B Ordinary Shares"; together with the Class A Ordinary Shares, the "Ordinary Shares"). Based on our dual-class voting structure, holders of Class A Ordinary Shares will be entitled to one (1) vote per share in respect of matters requiring the votes of shareholders, while holders of Class B Ordinary Shares will be entitled to one hundred (100) votes per share. See "Risk Factors — Risks Related to our Capital Structure" on page 51 of this prospectus.

We are not a Chinese operating company, but rather a holding company incorporated in the Cayman Islands. As a holding company with no material operations of our own, we conduct our operations through our operating entities established in the PRC. As such, our corporate structure involves unique risks to investors. Investors of our Class A Ordinary Shares do not directly own any equity interests in our Chinese operating subsidiaries, but will instead own shares of a Cayman Islands holding company. The Chinese regulatory authorities could intervene or influence the operations of our Chinese operating subsidiaries, including disallowing our corporate structure, which would likely result in a material change in our operations and/or a material change in the value of our Class A Ordinary Shares. For details, see "Risk Factors — Risks Relating to Doing Business in China — Any actions by the Chinese government, including any decision to intervene or influence the operations of the operating entities or to exert control over any offering of securities conducted overseas and/or foreign investment in China-based issuers, may cause us to make material changes to the operations of the PRC operating entities, may limit or completely hinder our ability to continue to offer securities to investors, and may cause the value of such securities to significantly decline or be worthless" on page 16 of this prospectus.

We are subject to legal and operational risks associated with being based in and having the majority of our operations in China. These risks may result in a material change in our operations, or a complete hindrance of our ability to offer or continue to offer our securities to investors, and could cause the value of such securities to significantly decline or become worthless. Since 2021, the PRC government initiated a series of regulatory actions and statements to regulate business operations in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using variable interest entity structure, and adopting new measures to extend the scope of cybersecurity reviews. On July 6, 2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly issued an announcement to crack down on illegal activities in the securities market and promote the high-quality development of the capital market, which, among other things, requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement and judicial cooperation, to enhance supervision over China-based companies listed overseas, and to establish and improve the system of extraterritorial application of the PRC securities laws. On December 28, 2021, the Cyberspace Administration of China (the "CAC"), together with 12 other governmental departments of the PRC, jointly promulgated the Cybersecurity Review Measures, which became effective on February 15, 2022. The Cybersecurity Review Measures require that an online platform operator which 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 30, 2024, the State Council of China published the Regulations on Network Data Security Administration, 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 relevant cyberspace administration of the PRC. The Regulations on Network Data Security Administration became effective on January 1, 2025. On October 28, 2025, the Standing Committee of the National People's Congress adopted a decision to amend the Cybersecurity Law of the People's Republic of China. This revision significantly raises the maximum thresholds for financial penalties for violations, establishes a legal framework for the security governance of new technologies such as artificial intelligence, and further strengthens the security protection responsibilities and extraterritorial application of the law for network operators, particularly platforms. The amended law became effective on January 1, 2026. As confirmed by our PRC counsel, Guantao Law Firm, since we are not an online platform operator that possesses over one million users' personal information, we are not subject to the cybersecurity review with the CAC under the Cybersecurity Review Measures and the Regulations on Network Data Security Administration. There remains uncertainty, however, as to how the Cybersecurity Review Measures will be interpreted or implemented and whether the PRC regulatory agencies, including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Cybersecurity Review Measures and the Regulations on Network Data Security Administration.

In addition, since 2021, the Chinese government has strengthened its anti-monopoly supervision, mainly in three aspects: (1) establishing the National Anti-Monopoly Bureau; (2) revising and promulgating anti-monopoly laws and regulations, including: the Anti-Monopoly Law (draft Amendment published on October 23, 2021 for public opinion; the newly revised Anti-Monopoly Law was promulgated on June 24, 2022, and became effective on August 1, 2022), the anti-monopoly guidelines for various industries, and the detailed Rules for the Implementation of the Fair Competition Review System; and (3) expanding the anti-monopoly law enforcement targeting Internet companies and large enterprises. As of the date of this prospectus, the Chinese government's recent statements and regulatory actions related to anti-monopoly concerns have not impacted our ability to conduct business, accept foreign investments, or list on a U.S. or other foreign exchange, because neither the Company nor its PRC operating entities engage in monopolistic behaviors that are subject to these statements or regulatory actions.

On February 17, 2023, the China Securities Regulatory Commission (the "CSRC") released the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies, or the Trial Measures, and five supporting guidelines, which came into effect on March 31, 2023. The Trial Measures regulate both direct and indirect overseas offering and listing by PRC domestic companies by adopting a filing-based regulatory regime. Pursuant to the Trial Measures, domestic companies that seek to offer or list securities overseas, whether directly or indirectly, should fulfill the filing procedures and report relevant information to the CSRC within three working days after submitting listing applications and subsequent amendments. According to the Notice on the Administrative Arrangements for the Filing of the Overseas Securities Offering and Listing by Domestic Companies from the CSRC, or the CSRC Notice, the domestic companies that have already been listed overseas before the effective date of the Trial Measures (i.e. March 31, 2023) shall be deemed to be existing issuers (the "Existing Issuers"). Existing Issuers are not required to complete the filing procedures immediately, and they shall be required to file with the CSRC for any subsequent offerings. Our PRC counsel, Guantao Law Firm, advised us that, since we obtained approval from both the U.S. Securities and Exchange Commission (the "SEC") and The Nasdaq Stock Market LLC to issue and list our shares on the Nasdaq Capital Market prior to March 31, 2023, and closed our initial public offering on April 24, 2023, we were not required to make the filing with the CSRC for our initial public offering immediately pursuant to the Trial Measures. Our PRC counsel, Guantao Law Firm, has advised us that, as this offering is regarded as a subsequent securities offering in the same overseas market under the Trial Measures, we are required to complete the filing procedures with the CSRC in accordance with the Trial Measures with respect to this offering, and we will submit our filing application to the CSRC within three working days after the completion of this offering. Given the current PRC regulatory environment, it is uncertain whether we or our PRC subsidiaries will be required to obtain approvals from the PRC government to offer securities to foreign investors in the future, and whether we would be able to obtain such approvals. If we are unable to obtain such approvals if required in the future, or inadvertently conclude that such approvals are not required then the value of our Class A Ordinary Shares may depreciate significantly or become worthless. For details, see "Risk Factors — Risks Relating to Doing Business in China — The PRC government exerts substantial influence over the manner in which we and our PRC subsidiaries must conduct our business activities. We are currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if we or our PRC subsidiaries are required to obtain approval in the future and are denied permission from Chinese authorities to list on U.S. exchanges, we will not be able to continue listing on U.S. exchanges, which would materially affect the interest of the investors" on page 28 of this prospectus.

Our PRC counsel, Guantao Law Firm, has advised us that, as of the date of this prospectus, we and our PRC subsidiaries have received from the PRC authorities all requisite licenses, permissions, or approvals that are required and material for conducting our operations in China, such as business licenses and auto dealer filings. However, it is uncertain whether we or our PRC subsidiaries will be required to obtain additional approvals, licenses, or permits in connection with our business operations pursuant to evolving PRC laws and regulations, and whether we would be able to obtain and renew such approvals on a timely basis or at all. Failing to do so could result in non-compliance and material change in our operations, and the value of our Class A Ordinary Shares could depreciate significantly or become worthless.

Under Cayman Islands law, a Cayman Islands company may pay a dividend on its shares out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts due in the ordinary course of business. As of the date of this prospectus, (1) the Company transferred approximately $2.53 million, $3.66 million, $4.88 million, $5.30 million and nil to a subsidiary, Energy U Limited, from July 1, 2025 to December 31, 2025, for the six months ended June 30, 2025, and for the fiscal years ended December 31, 2024, 2023 and 2022, respectively, and no other cash transfers or transfers of other assets have occurred between the Company and its subsidiaries, and (2) the Company and its subsidiaries have not made any dividends or distributions to investors. We intend to keep any future earnings to finance the expansion of our business, and we do not anticipate that any cash dividends will be paid in the foreseeable future. As of the date of this prospectus, we have not installed any cash management policies that dictate how funds are transferred among the Company, its subsidiaries, or investors.

Our PRC operating entities receive substantially all of our revenue in RMB. Under our current corporate structure, to fund any cash and financing requirements we may have, we may rely on dividend payments from the PRC operating subsidiaries. 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 State Administration of Foreign Exchange ("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. In addition, each of our subsidiaries in China 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. Each such entity in China is also required to further set aside a portion of its after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion of its board of directors. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation.

Cash dividends, if any, on our Class A Ordinary Shares, will be paid in U.S. dollars. If we are considered a PRC tax resident enterprise for tax purposes, any dividends we pay to our overseas shareholders may be regarded as China-sourced income and, as a result, may be subject to PRC withholding tax at a rate of up to 10.0%. Pursuant to the Arrangement between Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income, or the Double Tax Avoidance Arrangement, the 10% withholding tax rate may be lowered to 5% if a Hong Kong resident enterprise owns no less than 25% of a PRC project. The 5% withholding tax rate, however, does not automatically apply and certain requirements must be satisfied, including without limitation that (a) the Hong Kong project must be the beneficial owner of the relevant dividends; and (b) the Hong Kong project must directly hold no less than 25% share ownership in the PRC project during the 12 consecutive months preceding its receipt of the dividends. In current practice, a Hong Kong project must obtain a tax resident certificate from the Hong Kong tax authority to apply for the 5% lower PRC withholding tax rate. As the Hong Kong tax authority will issue such a tax resident certificate on a case-by-case basis, we cannot assure you that we will be able to obtain the tax resident certificate from the relevant Hong Kong tax authority and enjoy the preferential withholding tax rate of 5% under the Double Taxation Arrangement with respect to any dividends paid by WFOE, Shandong Yousheng New Energy Technology Development Co., Ltd., to its two direct Hong Kong holding companies. As of the date of this prospectus, we have not applied for the tax resident certificate from the relevant Hong Kong tax authority. Our Hong Kong subsidiaries intend to apply for the tax resident certificate if and when our PRC subsidiaries plan to declare and pay dividends to our Hong Kong subsidiaries.

As of the date of this prospectus, 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 the transfer of funds involving money laundering and criminal activities. For details, see "Risk Factors — Risks Relating to Doing Business in China — To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in mainland China or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets" on page 25 of this prospectus.

Our Class A Ordinary Shares may be delisted under the Holding Foreign Companies Accountable Act ("HFCAA") if the Public Company Accounting Oversight Board of the United States (the "PCAOB") is unable to inspect our auditors for three consecutive years beginning in 2021. On December 29, 2022, the Accelerating Holding Foreign Companies Accountable Act was signed into law as part of the Consolidated Appropriations Act, which amended the HFCAA by reducing the number of consecutive non-inspection years required for triggering the prohibitions under the HFCAA from three years to two.

On December 16, 2021, the PCAOB issued a report on its determinations that it was unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China and in Hong Kong, a Special Administrative Region of the PRC, because of positions taken by PRC authorities in those jurisdictions (the "Determination"). On August 26, 2022, the CSRC, the Ministry of Finance of the PRC (the "MOF"), and the PCAOB signed the Statement of Protocol (the "Protocol"), governing inspections and investigations of audit firms based in China and Hong Kong, taking the first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong. Pursuant to the fact sheet with respect to the Protocol disclosed by the SEC, the PCAOB shall have independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC. On December 15, 2022, the PCAOB determined that it was able to secure complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong and vacated its previous determinations to the contrary. Our former auditor, Onestop Assurance PAC ("Onestop"), was replaced by HHL LLP ("HHL") on July 31, 2025. HHL, a PCAOB-registered public accounting firm headquartered in New York, was subsequently dismissed and replaced by HCL, PLLC ("HCL") as our independent registered public accounting firm, effective January 13, 2026. Both our current auditor, HCL, and former auditors, HHL and Onestop, are subject to oversight by the PCAOB, which conducts regular inspections to assess compliance with applicable professional standards. Onestop has been inspected by the PCAOB on a regular basis, as required by U.S. law. Our current auditor, HCL, is headquartered at 1415 W 37th Street, Suite 200, Chicago, IL 60609, and expects to be inspected by the PCAOB on a regular basis. As of the date of this prospectus, we have not been affected by the HFCAA and the related regulations. However, should PRC authorities obstruct or otherwise fail to facilitate the PCAOB's access in the future, the PCAOB may consider the need to issue a new determination. There is a risk that our auditor cannot be inspected by the PCAOB in the future, and if the PCAOB determines that it cannot inspect or fully investigate our auditor for two consecutive years, our securities will be prohibited from trading on a national exchange or over-the-counter under the HFCAA, and, as a result, Nasdaq may determine to delist our securities, which may cause the value of our securities to decline or become worthless. For details, see "Risk Factors — Risks Relating to Doing Business in China — The Holding Foreign Companies Accountable Act and the Accelerating Holding Foreign Companies Accountable Act call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB. These developments could add uncertainties to our continued listing on the Nasdaq Capital Market, and Nasdaq may determine to delist our securities if the PCAOB determines that it cannot inspect or fully investigate our auditor" on page 29 of this prospectus.

**We are a "foreign private issuer" and we are an "emerging growth company" under the federal securities laws and will be subject to reduced public company reporting requirements. See "Prospectus Summary — Implications of Being an Emerging Growth Company" and "Prospectus Summary — Implications of Being a Foreign Private Issuer" for additional information.**

**Investing in our securities involves a high degree of risk, including the risk that our Class A Ordinary Shares may be delisted from Nasdaq as a result of this offering. See "Risk Factors" beginning on page 15 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities.**

**Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Per Unit Consisting of<br> One <br> Class A Ordinary and <br> One Warrant** | **Per Unit<br> Consisting of <br> One Pre-funded<br> Warrant and One<br> Warrant** | **Total without<br> Over-<br> Allotment<br> Option<sup>(2)</sup>** | **Total<br> with Over-<br> Allotment<br> Option** |
| Public offering price | $— | $— |  |  |
| Underwriting discounts and commissions<sup>(1)</sup> | $— | $— |  |  |
| Proceeds, before expenses, to us<sup>(2)</sup> | $— | $— |  |  |

---

(1) The underwriting discounts and commissions shall equal 7.0% of the
gross proceeds of the securities sold by us in this offering. We have also agreed to reimburse the Representative for certain expenses
in connection with the offering. We refer you to the section entitled "Underwriting" of this prospectus for additional information
regarding total compensation and other items of value payable to the underwriters.

(2) We
 have granted the Representative an option exercisable within 45 days of the date of this
 prospectus to purchase from us up to 1,363,636 additional Class A Ordinary Shares at the
 assumed offering price of $0.65 per share and/or up to 1,363,636 Warrants at an assumed purchase
 price of $0.01 per Warrant, less underwriting discounts and commissions, to cover over-allotments,
 if any.

The offering will settle delivery versus payment or receipt versus payment, as the case may be. We expect to deliver the securities offered hereby on or about , 2026, subject to satisfaction of certain customary closing conditions.

***Sole Book-Running Manager***

**Maxim Group LLC**

The date of this prospectus is , 2026

**TABLE OF CONTENTS** 

---

| | |
|:---|:---|
| [PROSPECTUS SUMMARY](#a_001) | 1 |
| [THE OFFERING](#a_002) | 12 |
| [RISK FACTORS](#a_003) | 15 |
| [FORWARD-LOOKING STATEMENTS](#a_004) | 60 |
| [USE OF PROCEEDS](#a_005) | 61 |
| [CAPITALIZATION](#a_006) | 62 |
| [DIVIDEND POLICY](#a_007) | 63 |
| [DILUTION](#a_026) | 64 |
| [CORPORATE HISTORY AND STRUCTURE](#a_008) | 66 |
| [MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#a_009) | 68 |
| [BUSINESS](#a_010) | 90 |
| [MANAGEMENT](#a_011) | 105 |
| [CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS](#a_012) | 110 |
| [SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT](#a_013) | 112 |
| [DESCRIPTION OF SHARE CAPITAL](#a_014) | 114 |
| [DESCRIPTION OF THE SECURITIES WE ARE OFFERING](#a_015) | 134 |
| [SHARES ELIGIBLE FOR FUTURE SALE](#a_016) | 136 |
| [TAX CONSIDERATIONS](#a_017) | 136 |
| [UNDERWRITING](#a_018) | 145 |
| [SERVICE OF PROCESS AND ENFORCEMENT OF CIVIL LIABILITIES](#a_019) | 149 |
| [EXPENSES RELATING TO THIS OFFERING](#a_020) | 151 |
| [LEGAL MATTERS](#a_021) | 151 |
| [EXPERTS](#a_023) | 151 |
| [WHERE YOU CAN FIND ADDITIONAL INFORMATION](#a_024) | 151 |
| [INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS](#a_025) | F-1 |

---

i

You should rely only on the information contained in this prospectus or in any free writing prospectus we may authorize to be delivered to you. We have not, and the underwriters have not, authorized any other person to provide you with additional, different, or inconsistent information. If anyone provides you with additional, different, or inconsistent information, you should not rely on it. We may not sell these securities until the registration statement filed with the U.S. Securities and Exchange Commission (the "SEC" or the "Commission"), is effective. We are not, and the underwriters are not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information appearing in this prospectus is accurate as of any date other than the date on the front cover of this prospectus unless otherwise specified herein. Our business, financial condition, results of operations, and prospects may have changed since that date. Information contained on our website does not constitute part of this prospectus.

The market data and other statistical information used throughout this prospectus has been compiled from publicly available information and industry publications. These sources generally state that the information they provide is believed to be reliable however, it is subject to subjective assessments and changes and cannot always be verified with complete certainty due to limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties inherent in any market research and statistical survey. Therefore, the accuracy and completeness of the information are not guaranteed, and estimates and beliefs based on such data may not be reliable. In addition, such market data and statistical information may be different from other sources and may not reflect all or even a comprehensive set of the actual events and transactions occurring in the market. Although we are responsible for all of the disclosures contained in this prospectus and we believe that such market data and statistical information is reliable, we have not independently verified its accuracy or completeness. In addition, some data is also based on our good faith estimates and our management's understanding of industry conditions. Such data involve risks and uncertainties and are subject to change based on various factors, including those discussed under the headings "Forward-Looking Statements" and "Risk Factors" in this prospectus.

ii

**Commonly Used Defined Terms**

Unless otherwise indicated, in this prospectus, references to:

● "AHYS" are to Anhui Yousheng New Energy Co., Ltd., a limited liability company established pursuant to PRC laws on May 16, 2013, which is controlled by WFOE (as defined below) with 100% equity ownership;

● "BVI" are to the British Virgin Islands;

● "China" and the "PRC" are to the People's Republic of China;

● "CD Youyineng" are to Chengdu Youyineng Automobile Service Co., Ltd., a limited liability company established pursuant to PRC laws on October 29, 2020, and is wholly owned by AHYS;

● "Class A Ordinary Shares" are to our Class A ordinary shares, par value US$0.00001 per share;

● "Class B Ordinary Shares" are to our Class B ordinary shares, par value US$0.00001 per share;

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

● "EV" are to electric vehicle;

● "Group" are to the Company and its subsidiaries, collectively;

● "Hong Kong" or "HK" are to the Hong Kong Special Administrative Region of the PRC;

● "ISO" are to a series of quality management and quality assurance standards published by International Organization for Standardization, a non-government organization based in Geneva, Switzerland, for assessing the quality systems of business organizations;

● "mainland China" are to the mainland China of the PRC, excluding Taiwan, the special administrative regions of Hong Kong and Macau for the purposes of this prospectus only;

● "Nasdaq Official Closing Price" are to the most recent closing price of the Class A Ordinary Shares on Nasdaq preceding the effectiveness of the registration statement of which this prospectus forms a part;

● "our PRC subsidiaries" or "PRC operating subsidiaries" are to AHYS and its subsidiaries, including CD Youyineng, SH Youteng (defined below), SH Youxu (defined below), Youpin (defined below), Youpin SD (defined below), and their respective subsidiaries;

● "RMB" and "Renminbi" are to the legal currency of China;

● "R&D" are to research and development;

● "Ordinary Shares" are to our Class A Ordinary Shares and our Class B Ordinary Shares, collectively;

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

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

● "SH Youteng" are to Shanghai Youteng Automobile Service Co., Ltd., a limited liability company established pursuant to PRC laws on November 3, 2020, and AHYS holds 70% of its equity interests;

● "SH Youxu" are to Shanghai Youxu New Energy Technology Co., Ltd., a limited liability company established pursuant to PRC laws on March 22, 2021, and AHYS holds 70% of its equity interests;

iii

● "SME dealers" are to small and medium sized vehicle dealers;

● "UK" are to the United Kingdom, made up of England, Scotland, Wales and Northern Ireland;

● "U.S.," "US" or "United States" are to United States of America, its territories, its possessions and all areas subject to its jurisdiction;

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

● "we," "us," "Company," and "our" are to U Power Limited, the Cayman Islands holding company, and its predecessor entity and its subsidiaries, as the context requires;

● "WFOE" are to our wholly owned Chinese subsidiary, Shandong Yousheng New Energy Technology Development Co., Ltd., a limited liability company established pursuant to PRC laws on January 27, 2022;

● "Youpin" are to Youpin Automobile Service Group Co., Ltd., a limited liability company established pursuant to PRC laws on July 18, 2013, and AHYS holds 54.37% of its equity interests; and

● "Youpin SD" are to Youpin Automobile Service (Shandong) Co., Ltd., a limited liability company established pursuant to PRC laws on June 30, 2020, and AHYS holds 87% of its equity interests.

Our reporting and functional currency is the Renminbi, or RMB. Solely for the convenience of the reader, this prospectus contains translations of some RMB amounts into U.S. dollars, at specified rates. No representation is made that the RMB amounts referred to in this prospectus could have been or could be converted into U.S. dollars at such rate.

Our fiscal year end is December 31. References to a particular "fiscal year" are to our fiscal year ended December 31 of that calendar year. Our audited consolidated financial statements have been prepared in accordance with the generally accepted accounting principles in the United States (the "U.S. GAAP").

The PRC subsidiaries have proprietary rights to trademarks used in this prospectus that are important to their business, many of which are registered under applicable intellectual property laws. Solely for convenience, the trademarks, service marks and trade names referred to in this prospectus are without the<sup>®</sup>,™ and other similar symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, the PRC subsidiaries' rights or the rights of the applicable licensors to these trademarks, service marks and trade names.

This prospectus contains additional trademarks, service marks and trade names of others. All trademarks, service marks and trade names appearing in this prospectus are, to our knowledge, the property of their respective owners. We do not intend our use or display of other companies' trademarks, service marks or trade names to imply a relationship with, or endorsement or sponsorship of us by, any other person.

iv

**PROSPECTUS SUMMARY** 

*The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and financial statements appearing elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus before deciding whether to invest in our securities.*

**Overview**

Since our commencement of operations in 2013, we have principally engaged in the provision of vehicle sourcing services. We broker sales of vehicles between automobile wholesalers and buyers, including SME dealers and individual customers primarily located in the lower-tier cities in China, which are smaller and less developed than the tier-1 or tier-2 cities. To that end, we have focused on building business relationships with our sourcing partners and have developed a vehicle sourcing network. As of the date of this prospectus, our vehicle sourcing network consisted of approximately 100 wholesalers and 30 SME dealers located in lower-tier cities in China. For the six months ended June 30, 2025 and for the fiscal years ended December 31, 2022, 2023 and 2024, our revenue from the sourcing business was RMB2.8 million, RMB4.4 million, RMB1.5 million, and RMB0.1 million, respectively, which constituted 15.9%, 56.8%, 7.7%, and 0.1%, respectively, of our total revenue.

Beginning in 2020, we gradually shifted our focus from the vehicle sourcing business to the development of our proprietary battery-swapping technology, or UOTTA technology. We plan to develop a comprehensive EV battery power solution based on UOTTA technology, which mainly consists of: (i) vehicle-mounted supervisory control units that monitor the real-time status of an EV's battery packs; (ii) customized vehicle control units ("VCUs"), which upload real-time data of the electric vehicle, such as its battery status, real-time location and safety status, to our data platform, using Bluetooth and/or Wi-Fi technologies; and (iii) our data management platform, which collects and synchronizes real-time information of the EVs uploaded by their respective VCUs, as well as information on the availability and locations of compatible UOTTA battery-swapping stations that assist drivers in locating the nearest compatible UOTTA battery-swapping station(s) available when the EV's battery is determined to be lower than a certain level; and (iv) UOTTA battery-swapping stations designed for precise positioning, rapid disassembly, compact integration and flexible deployment of battery-swapping for compatible EVs.

We have established in-house capabilities in the innovation of EV battery-swapping technology. Through our research and development efforts, we are developing an intellectual property portfolio. As of the date of this prospectus, we had 51 issued patents and 18 pending patent applications in China. Our research and development team is committed to technology innovation. As of the date of this prospectus, our research and development team consisted of 25 personnel and is led by Mr. Rui Wang and Mr. Zhanduo Hao, each of whom has experience of over 20 years in the electric power sector.

In 2021, leveraging years of automobile industry experience, we started cooperating with major automobile manufactures to jointly develop UOTTA-powered EVs, by adapting selected EV models with our UOTTA technology. We intend to primarily focus on developing commercial-use UOTTA-powered EVs, such as ride-hailing passenger EVs, small logistics EVs, light electric trucks, and heavy electric trucks, and their compatible UOTTA battery-swapping stations. As of the date of this prospectus, we have entered into cooperating agreements with two Chinese automobile manufacturers, SAIC Maxus Automobile Co., Ltd. and SAIC Hongyan Automobile Co., Ltd., to jointly develop UOTTA-powered electric trucks. We also have engaged with one battery-swapping station manufacture to jointly develop and manufacture UOTTA battery-swapping stations that are compatible with UOTTA-powered EVs. Our UOTTA battery-swapping stations are designed for precise positioning, rapid disassembly, compact integration, and flexible deployment, allowing battery replacement within several minutes. As of the date of this prospectus, we realized sales of thirty-two battery-swapping stations. In order to provide a comprehensive battery power solution based on UOTTA technology, we are in the process of developing a data management platform that connects UOTTA-powered EVs and stations, and assists the UOTTA-powered EV drivers in locating the closest compatible UOTTA swapping-stations on their routes. We believe we have made significant progress in entering into the EV market as of the date of this prospectus, however, there is no assurance that we will be able to execute our business plan to expand into the EV market as we have planned. For the six months ended June 30, 2025 and for the fiscal years ended December 31, 2022, 2023, and 2024, our revenue from the EV business was RMB13.9 million, RMB3.1 million, RMB17.1 million, and RMB41.8 million, which constituted 78.4%, 86.3%, and 94.5%, respectively, of our total revenue.

Additionally, we plan to develop AI-integrated solutions for energy grids and transportation systems. By incorporating AI algorithms, our comprehensive solutions for smart energy grids are expected to support autonomous EV driving, optimize energy replenishment efficiency, and connect EV assets with advanced AI-powered transportation systems, enabling peak and off-peak energy load balancing.

**Recent Developments**

***Change of Voting Power***

At the 2025 Annual General Meeting held on December 5, 2025, shareholders approved three resolutions (i) authorizing the increasing of the voting power of the Class B ordinary shares from 20 to 100 votes per share; (ii) adopting a third amended and restated memorandum and articles of association; and (iii) authorizing the following conditional share consolidations:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) on a date when the closing market price per Class A ordinary shares of par value of US$0.00001 each is less than US$1.00, or on such date as any director, chief executive officer or chief operating officer of the Company deems advisable, each 10 ordinary shares of a par value of US$0.00001 each be consolidated into 1 (one) ordinary share of a par value of US$0.0001 each, such that following such share consolidation, the authorized share capital of the Company will be US$50,000 divided into 399,941,181.2 Class A ordinary shares of a par value of US$0.0001 each, and 100,058,818.8 Class B ordinary shares of a par value of US$0.0001 each (the "First Share Consolidation");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) subsequently following the First Share Consolidation, on a date when the closing market price per the Class A ordinary share of a par value of US$0.0001 each is less than US$1.00, or on such date as any director, chief executive officer or chief operating officer of the Company deems advisable, each 20 ordinary shares of a par value of US$0.0001 each be consolidated into 1 (one) ordinary share of a par value of US$0.002 each, such that following such share consolidation, the authorized share capital of the Company will be US$50,000 divided into 19,997,059.06 Class A ordinary shares of a par value of US$0.002 each, and 5,002,940.94 Class B ordinary shares of a par value of US$0.002 each (the "Second Share Consolidation");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) subsequently following the Second Share Consolidation, on a date when the closing market price per the Class A ordinary share of a par value of US$0.002 each is less than US$1.00, or on such date as any director, chief executive officer or chief operating officer of the Company deems advisable and may determine in his or her absolute discretion, each 20 ordinary shares of a par value of US$0.002 each be consolidated into 1 (one) ordinary share of a par value of US$0.04 each, such that following such share consolidation, the authorized share capital of the Company will be US$50,000 divided into 999,852.953 Class A ordinary shares of a par value of US$0.04 each, and 250,147.047 Class B ordinary shares of a par value of US$0.04 each (the "Third Share Consolidation", and together with the First Share Consolidation and the Second Share Consolidation, the "Share Consolidations"); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) all fractional shares (after aggregating all fractional shares that would otherwise be received by a shareholder) resulting from each of the Share Consolidations shall be rounded up to the whole number of shares.

***Entry into Material Agreements with Maxim Group LLC and an institutional investor.***

On December 1, 2025, we entered into a placement agency agreement (the "Placement Agency Agreement") with Maxim Group LLC, as the sole placement agent, and a securities purchase agreement (the "December 2025 SPA") with an institutional investor, pursuant to which the Company received US$2,013,600 in consideration for the issuance of a series of senior secured promissory notes (collectively, the "2025 Senior Secured Promissory Notes") in the original aggregate principal amount of US$2,517,000 to the institutional investor.

The 2025 Senior Secured Promissory Notes were issued with twenty percent (20%) original issue discount, and bear no interest unless an event of default occurs, and are due and payable by the Company on the maturity date of March 1, 2026. Any principal or other amounts due under the December 2025 SPA and the 2025 Senior Secured Promissory Notes that are not paid when due (excluding amounts already accruing interest at the default rate established therefor under the 2025 Senior Secured Promissory Notes) shall incur a late charge equal to 18% per annum from the due date until fully paid.

Additionally, on December 1, 2025, the institutional investor and certain subsidiaries of the Company (collectively, the "Pledgors"), entered into a pledge agreement (the "Pledge Agreement"), pursuant to which the Pledgors pledged their respective interests in Ordinary Shares of the Company and other related collateral (collectively, the "Pledged Collateral") to the investor, to secure the prompt payment and performance of all obligations under the 2025 Senior Secured Promissory Notes, the December 2025 SPA, and related transaction documents. Concurrently therewith, the Company, the Pledgors, and the institutional investor entered into an equity interest control agreement to perfect the security interest pledged in the Pledged Collateral pursuant to the Pledge Agreement.

In accordance with the terms of the Senior Secured Promissory Notes, in the event of any delay in the repayment of principal, the Company shall pay to Maxim Group LLC a late charge at a rate equal to 18% per annum, calculated from the applicable due date until such amount is fully paid.

The securities described above were sold pursuant to an exemption from the registration requirements under Section 4(a)(2) of the Securities Act and/or Rule 506 of Regulation D promulgated thereunder. The investor is an accredited investor that purchased the securities as an investment in a private placement that did not involve a general solicitation.

***Entry Into a Material Definitive Agreement with Certain Institutional Investors***

 ****

On July 24, 2025, we entered into a securities purchase agreement (the "July 2025 SPA") with certain institutional investors, pursuant to which we issued and sold (i) in a registered direct offering 445,000 Class A Ordinary Shares and certain pre-funded warrants to purchase up to 106,628 Class A Ordinary Shares, and (ii) in a concurrent private placement, certain common warrants to purchase up to 551,628 Class A Ordinary Shares, which common warrants have an exercise price of $2.50 per Class A Ordinary Share, are exercisable immediately and will expire on July 24, 2030. The combined offering price for each Class A Ordinary Share and accompanying common warrant was $2.50. The closing of the transaction took place on July 25, 2025. The gross proceeds to the Company were approximately $1.38 million before deducting the placement agent's fees and other offering expenses.

The Class A Ordinary Shares, the pre-funded warrants and the Class A Ordinary Shares underlying the pre-funded warrants were offered by the Company pursuant to a registration statement on Form F-3 (File No.333-282901), previously filed and declared effective by the SEC on November 8, 2024, the base prospectus filed as part of the registration statement on Form F-3, and the prospectus supplement dated July 24, 2025. The issuance of the common warrants described above was exempt from the registration requirements of the Securities Act, pursuant to an exemption provided by Section 4(a)(2) thereof and/or Rule 506 of Regulation D promulgated thereunder as a transaction by an issuer not involving a public offering.

**Corporate Structure**

We are a Cayman Islands exempted company incorporated on June 17, 2021. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act (As Revised) of the Cayman Islands that do not apply to exempted companies.

The following diagram illustrates our corporate structure as of the date of this prospectus.

![](ea028160401_img1.jpg)

**Regulatory Developments on Overseas-listing**

On July 6, 2021, the relevant PRC governmental authorities made public the Opinions on Strictly Cracking Down Illegal Securities Activities in Accordance with the Law. These opinions emphasized the need to strengthen the administration over illegal securities activities and the supervision on overseas listings by China-based companies and proposed to take effective measures, such as promoting the construction of relevant regulatory systems to deal with the risks and incidents faced by China-based overseas-listed companies. As these opinions are recently issued, official guidance and related implementation rules have not been issued yet and the interpretation of these opinions remains unclear at this stage.

On February 17, 2023, the CSRC released the Trial Measures, which became effective on March 31, 2023. On the same date of the issuance of the Overseas Listings Rules, the CSRC circulated No. 1 to No. 5 Supporting Guidance Rules, the Notes on the Trial Measures, the Notice on Administration Arrangements for the Filing of Overseas Listings by Domestic Enterprises and the relevant CSRC Answers to Reporter Questions on the official website of CSRC, or collectively, the Guidance Rules and Notice. The Overseas Listings Rules, together with the Guidance Rules and Notice, reiterate the basic supervision principles as reflected in the Administration Provisions and Measures by providing substantially the same requirements for filings of overseas offering and listing by domestic companies.

Under the Trial Measures and the Guidance Rules and Notice, domestic companies conducting overseas securities offering and listing activities, either in direct or indirect form, shall complete filing procedures with the CSRC pursuant to the requirements of the Trial Measures within three working days following submission of initial public offerings or listing applications. The companies that have already been listed on overseas stock exchanges or have obtained the approval from overseas supervision administrations or stock exchanges for its offering and listing before March 31, 2023 and completed their overseas offering and listing prior to September 30, 2023, such as us, shall be deemed to be Existing Issuers. Existing Issuers are not required to complete the filing procedures for listing overseas immediately, but are required to file with the CSRC for any subsequent offerings in the same overseas market within three working days after the offering is completed. Our PRC counsel, Guantao Law Firm, has advised us that, as this offering is regarded as a subsequent securities offering in the same overseas market under the Trial Measures, we are required to complete the filing procedures with the CSRC in accordance with the Trial Measures with respect to this offering, and we will submit our filing application to the CSRC within three working days after the completion of this offering. Any failure by us to comply with such filing requirements under the Trial Measures may result in forced corrections, warnings, and fines against us and could materially hinder our ability to offer or continue to offer our securities.

As of the date of this prospectus, neither we nor any of the PRC operating entities have been subject to any investigation, or received any warning, or sanction from the CSRC or other applicable government authorities related to the offering of our securities.

**Permissions from the PRC Authorities**

As of the date of this prospectus, we and our PRC operating entities have received from PRC authorities all requisite licenses, permissions, and approvals needed to engage in the businesses currently conducted in the PRC, and no such permission or approval has been denied. These licenses, permissions, and approvals, which have been successfully obtained, are: (1) business licenses; and (2) auto dealer filings. However, in the future, if any additional approvals or permissions are required, we cannot assure you that any of these entities will be able to receive clearance of compliance requirements in a timely manner, or at all. Any failure to fully comply with any compliance requirements may cause our PRC operating entities, to be unable to operate their businesses in the PRC, subject them to fines, relevant businesses or operations suspension for rectification, or other sanctions.

On December 28, 2021, thirteen governmental departments of the PRC, including the CAC, issued the revised Cybersecurity Review Measures, which became effective on February 15, 2022. The Cybersecurity Review Measures require that any network platform operator which 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. As advised by our PRC counsel, Guantao Law Firm, since we are not an online platform operator that possesses over one million users' personal information, we are not subject to the cybersecurity review with the CAC under the Cybersecurity Review Measures. However, as uncertainties remain regarding the interpretation and implementation of these laws and regulations, we cannot assure you that we will be able to 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 and the costs of compliance with, and other burdens imposed by such laws and regulations may limit the use and adoption of our products, which may have material adverse effects on our business, operations, and financial condition.

On July 7, 2022, the CAC published the Measures for the Security Assessment of Outbound Data Transfer, which became effective on September 1, 2022. The measures apply to the security assessment of important data and personal information collected and generated during operation within the territory of the People's Republic of China and transferred abroad by a data handler. According to the Measures, a data handler shall file with the State Cyberspace Administration for security assessment via the Province Cyberspace Administration if it transfers data abroad under any of the following circumstances: (i) a data handler who transfers important data abroad; (ii) a critical information infrastructure operator, or a data handler processing the personal information of more than one million individuals transfers personal information to abroad; (iii) since January 1 of the previous year, a data handler cumulatively transferred abroad the personal information of more than 100,000 individuals, or the sensitive personal information of more than 10,000 individuals; or (iv) any other circumstances where the security assessment for the outbound data transfer is required by the State Cyberspace Administration. As advised by our PRC counsel, Guantao Law Firm, since none of our PRC operating entities is a data handler that transfers data abroad under any of the aforementioned circumstances, the operations of the PRC operating entities, our continued listing, and this offering are not affected by the Measures for the Security Assessment of Outbound Data Transfer.

As of the date of this prospectus, our PRC operating entities have not received any notice from any authorities identifying the operating entities as a CIIO or requiring the operating entities to go through cybersecurity review or network data security review by the CAC, nor have our PRC operating entities been involved in any investigations on cybersecurity review initiated by the CAC or related governmental regulatory authorities. In addition, our PRC operating entities have not received any inquiry, notice, warning, or sanction in such respect. We believe that our PRC operating entities are in compliance with the aforementioned regulations and policies. However, our PRC operating entities could become subject to enhanced cybersecurity review or investigations launched by PRC regulators in the future. Any failure or delay in the completion of the cybersecurity review procedures or any other non-compliance with the related laws and regulations may result in fines or other penalties, including suspension of business, website closure, and revocation of prerequisite licenses, as well as reputational damage or legal proceedings or actions against the PRC operating entities, which may have material adverse effect on the PRC operating entities' business, financial condition or results of operations.

In addition, on February 17, 2023, the CSRC promulgated the Trial Measures and five supporting guidelines, which took effect on March 31, 2023. Pursuant to the Trial Measures, PRC domestic companies that seek to offer or list securities overseas, both directly and indirectly, shall file with the CSRC pursuant to the requirements of the Trial Measures within three working days following submission of relevant application for listing or completion of any subsequent offerings. If a domestic company fails to complete required filing procedures or conceals any material facts or falsifies any major content in its filing documents, such domestic company may be subject to administrative penalties, such as an order to rectify, warnings, and fines, and its controlling shareholders, actual controllers, and the person directly in charge and other directly liable persons may also be subject to administrative penalties, such as warnings and fines. As of the date of this prospectus, neither we nor any of the PRC operating entities have been subject to any investigation, or received any warning, or sanction from the CSRC or other applicable government authorities related to the offering of our securities.

As of the date of this prospectus, we believe that, except for the filing procedures with the CSRC pursuant to the Trial Measures and supporting guidelines, neither the Company, nor the PRC operating entities, will be required to obtain permission from any Chinese authorities to offer our securities based on PRC laws and regulations currently in effect, and neither we nor the PRC operating entities have been denied such permission by any Chinese authorities. However, we cannot assure you that the PRC regulatory agencies would take the same view as we do, and there is no assurance that our PRC operating entities will always be able to successfully update or renew the licenses or permits required for the relevant business in a timely manner or that these licenses or permits are sufficient to conduct all of their present or future business. If our PRC operating entities (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 operating entities, 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.

**Distributions and Dividends**

Under Cayman Islands law, a Cayman Islands company may pay a dividend on its shares out of either profits or share premium, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts due in the ordinary course of business. As of the date of this prospectus, (1) the Company transferred approximately $2.53 million, $3.66 million, $4.88 million, $5.30 million, and nil to a subsidiary, Energy U Limited, from July 1, 2025 to December 31, 2025, for the six months ended June 30, 2025, and for the fiscal years ended December 31, 2024, 2023, and 2022, respectively, and no other cash transfers or transfers of other assets have occurred between the Company and its subsidiaries, and (2) the Company and its subsidiaries have not made any dividends or distributions to investors. We intend to keep any future earnings to finance the expansion of our business, and we do not anticipate that any cash dividends will be paid in the foreseeable future. As of the date of this prospectus, we have not installed any cash management policies that dictate how funds are transferred among the Company, its subsidiaries, or investors.

Our PRC operating entities receive substantially all of our revenue in RMB. Under our current corporate structure, to fund any cash and financing requirements we may have, we may rely on dividend payments from the PRC operating subsidiaries. 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 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. In addition, each of our subsidiaries in China 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. Each such entity in China is also required to further set aside a portion of its after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion of its board of directors. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation.

Cash dividends, if any, on our Ordinary Shares, will be paid in U.S. dollars. If we are considered a PRC tax resident enterprise for tax purposes, any dividends we pay to our overseas shareholders may be regarded as China-sourced income and, as a result, may be subject to PRC withholding tax at a rate of up to 10%. Pursuant to the Arrangement between Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income, or the Double Tax Avoidance Arrangement, the 10% withholding tax rate may be lowered to 5% if a Hong Kong resident enterprise owns no less than 25% of a PRC project. The 5% withholding tax rate, however, does not automatically apply and certain requirements must be satisfied, including without limitation that (a) the Hong Kong project must be the beneficial owner of the relevant dividends; and (b) the Hong Kong project must directly hold no less than 25% share ownership in the PRC project during the 12 consecutive months preceding its receipt of the dividends. In current practice, a Hong Kong project must obtain a tax resident certificate from the Hong Kong tax authority to apply for the 5% lower PRC withholding tax rate. As the Hong Kong tax authority will issue such a tax resident certificate on a case-by-case basis, we cannot assure you that we will be able to obtain the tax resident certificate from the relevant Hong Kong tax authority and enjoy the preferential withholding tax rate of 5% under the Double Taxation Arrangement with respect to any dividends paid by WFOE, Shandong Yousheng New Energy Technology Development Co., Ltd, to its direct Hong Kong holding company. As of the date of this prospectus, we have not applied for the tax resident certificate from the relevant Hong Kong tax authority. Our Hong Kong subsidiaries intend to apply for the tax resident certificate if and when our PRC subsidiaries plan to declare and pay dividends to our Hong Kong subsidiaries.

**Summary of Risk Factors**

Investing in our Class A Ordinary Shares involves significant risks. You should carefully consider all of the information in this prospectus before making an investment in our Class A Ordinary Shares. Below please find a summary of the principal risks we face, organized under relevant headings. These risks are discussed more fully in the section titled "Risk Factors" of this prospectus.

***Risks Relating to Doing Business in China***

Risks and uncertainties related to doing business in China include, but are not limited to, the following:

● Changes in China's economic, political or social conditions, laws, regulations or governmental policies could have a material adverse effect on our business, financial conditions and results of operations. PRC laws and regulations governing our current business operations are sometimes vague and uncertain and any changes in such laws and regulations may impair our ability to operate profitably. For details, see the risk factor on page 15 of this prospectus;

● Substantial uncertainties in the promulgation, interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us. For details, see the risk factor on page 16 of this prospectus;

● Any actions by the Chinese government, including any decision to intervene or influence the operations of the operating entities or to exert control over any offering of securities conducted overseas and/or foreign investment in China-based issuers, may cause us to make material changes to the operations of the PRC operating entities, may limit or completely hinder our ability to offer or continue to offer securities to investors, and may cause the value of such securities to significantly decline or be worthless. For details, see the risk factor on page 16 of this prospectus;

● The M&A Rules and certain other PRC regulations may make it more difficult for us to pursue growth through acquisitions. For details, see the risk factor on page 22 of this prospectus;

● To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in mainland China or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets. For details, see the risk factor on page 25 of this prospectus;

● Governmental control of currency conversion may limit our ability to utilize our income effectively and affect the value of your investment. For details, see the risk factor on page 27 of this prospectus;

● The PRC government exerts substantial influence over the manner in which we and our PRC subsidiaries must conduct our business activities. We are currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if we or our PRC subsidiaries are required to obtain approval in the future and are denied permission from Chinese authorities to list on U.S. exchanges, we will not be able to continue listing on U.S. exchanges, which would materially affect the interest of the investors. For details, see the risk factor on page 28 of this prospectus;

● The Holding Foreign Companies Accountable Act and the Accelerating Holding Foreign Companies Accountable Act call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB. These developments could add uncertainties to our offering and listing on the Nasdaq Capital Market, and Nasdaq may determine to delist our securities if the PCAOB determines that it cannot inspect or fully investigate our auditor. For details, see the risk factor on page 29 of this prospectus; and

● Changes in international trade policies, or the escalation of tensions in international relations, particularly with regard to China, may adversely impact our business and operating results. For details, see the risk factor on page 31 of this prospectus.

***Risks Relating to Our Business and Industry***

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

● We have incurred substantial losses in the past and may incur losses in the future. There is substantial doubt about our ability to continue as a going concern. For details, see the risk factor on page 32 of this prospectus;

● We may be subject to potential liability in connection with pending or threatened legal proceedings and other matters, which could adversely affect our business or financial results. For details, see the risk factor on page 35 of this prospectus;

● Court-ordered freezes on equity interests in our PRC subsidiaries could restrict our ability to raise capital, disrupt our subsidiary operations, and materially harm our business and financial condition. For details, see the risk factor on page 36 of this prospectus;

● Some of our patent applications on UOTTA technology are currently pending, we cannot assure you that such patents will be approved, and we may not be able to prevent others from developing or exploiting competing technologies, which could have a material and adverse effect on our business, results of operations, financial condition and prospects. For details, see the risk factor on page 37 of this prospectus;

● The seasonality of the automobile industry impacts our operating results. For details, see the risk factor on page 40 of this prospectus; and

● The integration of AI technologies into our products and services is subject to significant risks and uncertainties, and there is no assurance that our AI strategy will be successful or that we will be able to effectively compete in this rapidly evolving field. For details, see the risk factor on 41 of this prospectus.

***Risks Related to Our Vehicle Sourcing Business***

Risks and uncertainties related to our vehicle sourcing business, but are not limited to, the following:

● Our vehicle sourcing network is crucial to the success of our business; if we fail to further develop or maintain our business relationships with sourcing partners at a sustainable cost, or at all, our business, financial condition and prospects would be materially and adversely affected. For details, see the risk factor on page 43 of this prospectus;

● The commissions from our sourcing services may decline in the future, and any material decrease in such commissions could harm our business, financial condition and results of operations. For details, see the risk factor on page 44 of this prospectus;

● Our business is sensitive to changes in the prices of new and used vehicles. For details, see the risk factor on page 45 of this prospectus; and

● We rely on third-party carriers to transport vehicles to our customers, and they are subject to associated business risks and costs and with those of the transportation industry, generally, many of which risks and costs would be out of our control. For details, see the risk factor on page 45 of this prospectus.

***Risks Related to UOTTA-powered EV and Battery-Swapping Station Business***

Risks and uncertainties related to our UOTTA-powered EV and battery-swapping station business include, but are not limited to, the following:

● Our success depends on our ability to successfully develop, market and sell UOTTA-powered EVs and battery-swapping stations. For details, see the risk factor on page 46 of this prospectus;

● Our reliance on third parties for manufacturing UOTTA-powered commercial-use EVs and battery-swapping stations increases the risk that the supply of our products may become limited or interrupted or may not be of satisfactory quality and quantity. For details, see the risk factor on page 47 of this prospectus;

● We depend on third parties for the supply of components and parts to manufacture battery-swapping stations. For details, see the risk factor on page 48 of this prospectus;

● The UOTTA-powered EVs we jointly develop with cooperating automobile manufacturers are subject to motor vehicle safety standards and the failure to satisfy such mandated safety standards would have a material adverse effect on our business and operating results. For details, see the risk factor on page 50 of this prospectus;

● The construction and operation of our battery-swapping station manufacturing facilities are subject to regulatory approvals or filings and may be subject to changes, delays, cost overruns or may not produce expected benefits. For details, see the risk factor on page 50 of this prospectus; and

● The unavailability, reduction or elimination of government and economic incentives or government policies which are favorable for EVs, domestically produced vehicles or battery-swapping stations could have a material adverse effect on our business, financial condition and prospects. For details, see the risk factor on page 50 of this prospectus.

***Risks Related to Our Capital Structure***

 ****

Risks and uncertainties related to our capital structure include, but are not limited to, the following:

● Our dual class share structure with different voting rights may adversely affect the value and liquidity of the Class A Ordinary Shares. For details, see the risk factor on page 51 of this prospectus; and

● Our dual class share structure with different voting rights will limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of our Class A Ordinary Shares may view as beneficial. For details, see the risk factor on page 51 of this prospectus.

***Risks Relating to this Offering, Our Class A Ordinary Shares and the Trading Market***

Risks and uncertainties related to this offering, our Class A Ordinary Shares and the trading market include, but are not limited to, the following:

● An active trading market for our Class A Ordinary Shares may not develop or sustain, and the trading price for our Class A Ordinary Shares may fluctuate significantly. For details, see the risk factor on page 52 of this prospectus;

● The trading price of our Class A Ordinary Shares has been, and is likely to continue to be, volatile, which could result in substantial losses to investors. For details, see the risk factor on page 52 of this prospectus;

● We may experience extreme stock price volatility unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Class A Ordinary Shares. For details, see the risk factor on page 53 of this prospectus;

● The sale or availability for sale of substantial amounts of our Class A Ordinary Shares could adversely affect their market price. For details, see the risk factor on page 53 of this prospectus;

● Because we do not expect to pay dividends in the foreseeable future, you must rely on price appreciation of our Class A Ordinary Shares for return on your investment. For details, see the risk factor on page 53 of this prospectus;

● We will incur increased costs as a result of being a public company. For details, see the risk factor on page 55 of this prospectus;

● As a result of the price resets and subsequent share adjustments in the Warrants and/or if the Warrants are exercised by way of a zero cash exercise, Class A Ordinary shareholders are likely to suffer substantial dilution and see a significant decrease in the value of their Class A Ordinary Shares . For details, see the risk factor on page 56 of this prospectus;

● There is no public market for the Pre-funded Warrants or Warrants in this offering. For details, see the risk factor on page 56 of this prospectus;

● Since we have broad discretion in how we use the proceeds from this offering, we may use the proceeds in ways with which you disagree. For details, see the risk factor on page 57 of this prospectus;

● Nasdaq may halt trading in our Class A Ordinary Shares on Nasdaq or delist our Class A Ordinary Shares for public interest concerns as a result of this offering. For details, see the risk factor on page 57 of this prospectus;

● We will likely not receive any additional funds upon the exercise of the Warrants. For details, see the risk factor on page 57 of this prospectus;

● The public offering price in this offering will be set by our Board and does not necessarily indicate the actual or market value of our Class A Ordinary Shares. For details, see the risk factor on page 57 of this prospectus;

● Nasdaq may apply additional and more stringent criteria for our continued listing, since our insiders hold a large portion of our listed securities. For details, see the risk factor on page 58 of this prospectus;

● Nasdaq has proposed a new $5 million minimum market value continued listing requirement that, if approved, could result in immediate suspension and delisting of our Class A Ordinary Shares without any cure period or opportunity to regain compliance. For details, see the risk factor on page 58 of this prospectus; and

● Geopolitical conflicts involving Iran, military actions in the Middle East, and the war in Ukraine may adversely affect global economic conditions and cause significant volatility in the trading price of our Class A Ordinary Shares. For details, see the risk factor on page 52 of this prospectus.

**Corporate Information** 

Our principal executive offices are located at 18/F, Building 3, Science and Technology Industrial Park, Yijiang District, Wuhu City, Anhui Province (安徽省芜湖市弋江区科技产业园3号楼18层), People's Republic of China. Our telephone number at this address is 0086-21-6859-3598. Our registered office in the Cayman Islands is located at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands.

Investors should submit any inquiries to the address and telephone number of our principal executive offices. Our corporate website is http://www.upincar.com/. The information contained on our websites is not a part of this prospectus. Our agent for service of process in the United States is located at 122 East 42nd St 18th Floor, New York, NY 10168.

The SEC maintains a website at www.sec.gov that contains reports, proxy, and information statements, and other information regarding issuers that file electronically with the SEC using its EDGAR system.

**Implications of Being an Emerging Growth Company**

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

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

● not being required to comply with the auditor attestation requirements in the assessment of our internal control over financial reporting;

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

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

We may take advantage of these provisions until the last day of our fiscal year following the fifth anniversary of our initial public offering. However, if certain events occur before the end of such five-year period, including if we become a "large accelerated filer," our annual gross revenue exceeds US$1.235 billion or we issue more than US$1.0 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company before the end of such five-year period.

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

**Implications of Being a Foreign Private Issuer**

We are a foreign private issuer within the meaning of the rules under the Exchange Act. As such, we are exempt from certain provisions applicable to United States domestic public companies. For example:

● we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company;

● for interim reporting, we are permitted to comply solely with our home country ' s requirements, which are less rigorous than the rules that apply to domestic public companies;

● we are not required to provide the same level of disclosure on certain issues, such as executive compensation;

● we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information;

● we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; and

● we are not required to comply with the "short-swing" profit disclosure and recovery provisions of Section 16 of the Exchange Act.

**THE OFFERING**

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| **Issuer** | U Power Limited |
| **Securities offered by us** | 9,090,909 Units, each Unit consisting of one Class A Ordinary Share and one Warrant to purchase one Class A Ordinary Share, at an assumed public offering price of $0.66 per Unit, based upon the closing price of our Class A Ordinary Shares on The Nasdaq Capital Market on March 11, 2026. |
|  | We are also offering to each purchaser whose purchase of Units in this offering would otherwise result in the purchaser, together with its affiliates, beneficially owning more than 4.99% (or, at the election of the purchaser, up to 9.99%) of our outstanding Class A Ordinary Shares immediately following the consummation of this offering, the opportunity to purchase, if the purchaser so chooses, Units including Pre-funded Warrants in lieu of the Class A Ordinary Shares that would otherwise result in the purchaser's beneficial ownership exceeding 4.99% (or, at the election of the purchaser, up to 9.99%) of our outstanding Class A Ordinary Shares. |
|  | For each Unit including a Pre-funded Warrant we sell (without regard to any limitation on exercise set forth therein), the number of Units including a Class A Ordinary Share we are offering will be decreased on a one-for-one basis. |
|  | This prospectus also relates to the offering of the Class A Ordinary Shares issuable upon exercise of the Pre-funded Warrants and Warrants. |
| **Description of the Pre-funded Warrants and Warrants** | Each Pre-funded Warrant will be exercisable for one Class A Ordinary Share. Subject to limited exceptions, a holder of Pre-funded Warrants will not have the right to exercise any portion of its Pre-funded Warrants if the holder, together with its affiliates, would beneficially own in excess of 4.99% (or, at the election of the holder, up to 9.99%) of the number of Class A Ordinary Shares outstanding immediately after giving effect to such exercise. The purchase price of each Unit including a Pre-funded Warrant will equal the price per Unit including one Class A Ordinary Share, minus $0.001, and the exercise price of each Pre-funded Warrant will be $0.001 per Class A Ordinary Share. The Pre-funded Warrants are immediately exercisable (subject to the beneficial ownership cap) and may be exercised at any time until all of the Pre-funded Warrants are exercised in full. |
|  | Each Warrant will be exercisable to purchase one Class A Ordinary Share. Each Warrant will have an initial exercise price of $0.66 per Class A Ordinary Share (100% of the assumed public offering price of each Unit in this offering), will be exercisable upon issuance, and will expire one (1) year from the issuance date. The exercise price for the Warrants will be adjusted downward (each, a "Reset Price") on each of the 2<sup>nd</sup> and 5<sup>th</sup> trading day following the issuance date (each, a "Reset Date") to the price that is equal to 70% and 50%, respectively, of the initial exercise price (the "Basis Price"), provided that the Reset Price is less than the exercise price then in effect and provided that in no event shall the exercise price of the Warrants be reduced to a price that is less than a floor price of the greater of (i) $0.10 and (ii) 20% of the closing bid price of the Class A Ordinary Shares on the date prior to the execution of the underwriting agreement entered into in connection with this offering. If the exercise price is so adjusted on a Reset Date, the number of Class A Ordinary Shares underlying the Warrants will also be proportionally increased on such Reset Date so that the applicable Reset Price multiplied by the increased number of Class A Ordinary Shares equal the aggregate proceeds that would have resulted from the full exercise of the Warrants immediately prior to the applicable Reset Date. The Warrants also contain certain mechanisms for cashless exercise, including zero cash exercise pursuant to which holders of Warrants have the option, upon exercise and for no additional cash consideration, to receive an aggregate number of Class A Ordinary Shares equal to the product of (x) the aggregate number of Class A Ordinary Shares that would be issuable upon a cash exercise of the Warrant and (y) 2.0; provided that no less than the par value of the additional number of Class A Ordinary Shares shall have been paid in full. The Warrants also contain certain anti-dilution provisions, as further described herein. |
|  | Accordingly, we believe it is highly unlikely that a holder of the Warrants would pay an exercise price in cash to receive one Class A Ordinary Share when the holder could instead choose the zero cash exercise option and pay no cash to receive more Class A Ordinary Shares than they would receive if they did pay an exercise price. As a result, we will likely not receive any additional funds and do not expect to receive any additional funds upon the exercise of the Warrants. |

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|  | As an example, for each Unit that an investor purchases in this offering at the assumed offering price of $0.66 per Unit, the investor will receive one Class A Ordinary Share and one Warrant to purchase one Class A Ordinary Share at an assumed exercise price of $0.66 per Class A Ordinary Share. Giving effect solely to the adjustment on the first Reset Date and not giving effect to the zero cash exercise option, on the first Reset Date, each Warrant will become exercisable for a maximum of 1.43 Class A Ordinary Shares at an exercise price of $0.462 per Class A Ordinary Share, assuming the public offering price per Unit is equal to the closing price of our Class A Ordinary Shares on the Nasdaq Capital Market immediately prior to the effectiveness of the registration statement of which this prospectus forms a part. If such Warrant is then exercised at such time based on the zero cash exercise option, the Warrant would be exercisable into 2.86 Class A Ordinary Shares. If the Warrant remains outstanding as of the second Reset Date, giving effect solely to the potential adjustment on the second Reset Date and not giving effect to the zero cash exercise option, on the second Reset Date, each Warrant will become exercisable for a maximum of two Class A Ordinary Shares at an exercise price of $0.33 per Class A Ordinary Share. If such Warrant is then exercised at such time based on the zero cash exercise option, the Warrant would be exercisable into four Class A Ordinary Shares. Accordingly, if all of the Warrants offered to investors in this offering are exercised on a zero cash basis, a maximum of 36,363,636 Class A Ordinary Shares could be issued upon such zero cash exercise, without payment to the Company of any additional cash. For the avoidance of doubt, the lower the closing price of our Class A Ordinary Shares on the Nasdaq Capital Market immediately prior to the effectiveness of the registration statement of which this prospectus forms a part (which will be no more than the public offering price per Unit in this offering), the more shares that will be issuable pursuant to the Warrants as a result of each reset (subject to the restriction that in no event shall the exercise price of the Warrants be reduced on such reset dates below a floor price of the greater of (i) $0.10 and (ii) 20% of the closing bid price of the Class A Ordinary Shares on the date prior to the execution of the underwriting agreement entered into in connection with this offering). As a result, the number of Class A Ordinary Shares issuable upon a zero cash exercise of the Warrants could substantially increase relative to the assumed pricing described in this example if our stock price declines prior to the effectiveness of this registration statement. <br>In addition, we have granted the Representative an option exercisable within 45 days of the date of this prospectus to purchase from us up to 1,363,636 additional Class A Ordinary Shares and/or up to 1,363,636 Warrants to cover over-allotments, if any. If the Representative's over-allotment option for Warrants is exercised in full to purchase 1,363,636 Warrants and all such Warrants are exercised on a zero cash basis, a maximum of 5,454,544 Class A Ordinary Shares could be issued upon such zero cash exercise without payment to the Company of any additional cash. If all of the Warrants offered to investors in this offering, including those subject to the Representative's over-allotment option for Warrants, are exercised on a zero cash basis, a maximum of 41,818,180 Class A Ordinary Shares could be issued upon such zero cash exercise without payment to the Company of any additional cash.  |
|  | For more information regarding the Pre-funded Warrants and Warrants, you should carefully read the section titled "Description of the Securities We Are Offering" in this prospectus. |
| <br> **Ordinary shares outstanding immediately before this offering** | <br> 4,603,440 Class A Ordinary Shares and 368,044 Class B Ordinary Shares. |

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|:---|:---|
| **Ordinary shares to be outstanding immediately after this offering(1)** | 13,694,349 Class A Ordinary Shares (or up to 15,057,985 Class A Ordinary Shares if the Representative exercises its over-allotment option for Class A Ordinary Shares in full) and 368,044 Class B Ordinary Shares, assuming (i) all of the offered Units are sold in this offering at an assumed public offering price of $0.66 per Unit, (ii) no sale of any Units containing a Pre-funded Warrant in this offering, and (iii) no exercises of the Warrants. At the same assumed public offering price of $0.66 per Unit and assuming the public offering price per Unit is equal to the closing price of our Class A Ordinary Shares on the Nasdaq Capital Market immediately prior to the effectiveness of the registration statement of which this prospectus forms a part, if all of the Warrants offered to investors, including those subject to the Representative's over-allotment option for Warrants, in this offering are exercised on a zero cash basis, an aggregate of 41,818,180 shares could be issued upon such zero cash exercise without payment to the Company of any additional cash and a total of 55,512,529 Class A Ordinary Shares would be issued and outstanding. <br>|
| **Over-allotment option** | We have granted the Representative an over-allotment option. This option, which is exercisable for up to forty-five (45) days after the date of this prospectus, permits the underwriters to purchase a maximum of 1,363,636 additional Class A Ordinary Shares and/or 1,363,636 additional Warrants to purchase Class A Ordinary Shares. The option may be used to purchase such Class A Ordinary Shares and/or Warrants, or any combination thereof, as determined by the Representative. If the Representative exercises all or part of this option, they will purchase securities covered by the option at the public offering price that appears on the cover page of this prospectus, less underwriting discounts and commissions. |

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|:---|:---|
| **Use of proceeds** | We estimate that the net proceeds from this offering will be approximately $5.23 million (assuming the sale of all Units offered) or $6.06 million (including the exercise of the over-allotment option in full), after deducting underwriting discounts and commissions and estimated offering expenses payable by us, and assuming no exercise of the Warrants (for which we do not expect to receive any proceeds in any case), based on an assumed public offering price of $0.66 per Unit. |
|  | We currently intend to use the net proceeds of this offering, after deducting underwriting discounts and commissions and estimated offering expenses payable by us, for the following purposes:<br>(i) US$2,517,000 will be applied to repay the outstanding principal balance due on the 2025 Senior Secured Promissory Notes, together with an 18% per annum late charge (which accrued as of their maturity on March 1, 2026), which notes are non-interest bearing; and<br>(ii) for working capital and other general corporate purposes. |
| **Listing** | Our Class A Ordinary Shares are listed on Nasdaq under the symbol "UCAR." There are no established public trading markets for the Pre-funded Warrants or the Warrants, and we do not expect such markets to develop. We do not intend to list the Pre-funded Warrants or the Warrants on any securities exchange or other trading market. |
| **Risk factors** | An investment in our securities involves substantial risks. You should read this prospectus carefully, including the section entitled "Risk Factors" and the financial statements and the related notes to those statements included elsewhere in this prospectus, before investing in our securities. In particular, you should be aware that Nasdaq may halt trading in our Class A Ordinary Shares and/or delist our Class A Ordinary Shares for public interest concerns. See "Risk Factors — Risks Relating to this Offering, Our Class A Ordinary Shares and the Trading Market — Nasdaq may halt trading in our Class A Ordinary Shares on Nasdaq or delist our Class A Ordinary Shares for public interest concerns as a result of this offering." |

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(1) Based on 4,603,440 Class A Ordinary Shares issued and outstanding as
of the date of this prospectus, which excludes (i) any Class A Ordinary Shares underlying the Warrants as of the date of this prospectus;
(ii) an aggregate of 551,628 Class A Ordinary Shares issuable upon the exercise of outstanding warrants issued pursuant to the July 2025
SPA; (iii) an aggregate of 1,562,502 Class A Ordinary Shares issuable upon the exercise of outstanding warrants issued pursuant to the
securities purchase agreement dated January 24, 2025 (the "January 2025 SPA"); and (iv) an aggregate of 50,000 Class A Ordinary
Shares issuable upon the exercise of outstanding warrants issued pursuant to the securities purchase agreement dated December 7, 2023
(the "December 2023 SPA"). Unless otherwise indicated, this prospectus reflects and assumes no exercise of the Pre-funded
Warrants or Warrants included in the Units offered hereby.

**RISK FACTORS**

*You should carefully consider the following risk factors that may affect our business, future operating results and financial condition, as well as the other information set forth in this prospectus, before making a decision to invest in our securities. If any of the following risks actually occurs, our business, operating results, cash flows, financial condition, and ability to pay dividends could be materially and adversely affected. In such case, the trading price of our securities would likely decline, and you may lose all or part of your investment. The risks below are not the only ones we face. Additional risks not currently known to us, or that we currently deem immaterial, may also adversely affect us.*

 

**Risks Relating to Doing Business in China**

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***Changes in China's economic, political or social conditions, laws, regulations or governmental policies could have a material adverse effect on our business, financial conditions and results of operations.***

All of our revenue is generated by our PRC subsidiaries. Accordingly, our results of operations, financial condition and prospects are influenced by economic, political and legal developments in China. Economic reforms begun in the late 1970s have resulted in significant economic growth. China's economy differs from the economies of most developed countries in many respects, including with respect to the amount of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources. Although the Chinese government has implemented measures emphasizing the utilization of market forces for economic reform, the reduction of state ownership of productive assets and the establishment of improved corporate governance in business enterprises, a substantial portion of productive assets in China is still owned by the government. In addition, the Chinese government continues to play a significant role in regulating industry development by imposing industrial policies. The Chinese government also exercises significant control over China's economic growth through allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policy, and providing preferential treatment to particular industries or companies.

Although the PRC economy has grown significantly in the past, that growth may not continue, as evidenced by the slowing of the growth of the PRC economy since 2012. Any adverse changes in economic conditions in China, in the policies of the PRC government or in the laws and regulations in China could have a material adverse effect on a specific industry including our PRC subsidiaries in China. Such developments could adversely affect our PRC subsidiaries' business and operating results, lead to reduction in demand for our services and adversely affect our competitive position. The Chinese government has implemented various measures to encourage economic growth and guide the allocation of resources. Some of these measures may benefit the overall Chinese economy but may have a negative effect on us. For example, our financial condition and results of operations may be adversely affected by government control over capital investments or changes in tax regulations. In addition, in the past the Chinese government has implemented certain measures, including interest rate adjustments, to control the pace of economic growth. These measures may cause decreased economic activities in China, which may adversely affect our business and operating results.

The PRC operating entities' ability to operate profitably in the PRC may be adversely affected by changes in policies by the PRC government, including changes in laws, regulations, or their interpretation, particularly those regarding the Internet, including censorship and other restrictions on material which can be transmitted over the Internet, security, intellectual property, money laundering, taxation, and other laws that affect our ability to operate our business.

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***PRC laws and regulations governing our current business operations are sometimes vague and uncertain and any changes in such laws and regulations may impair our ability to operate profitably.***

There are substantial uncertainties regarding the interpretation and application of PRC laws and regulations including, but not limited to, the laws and regulations governing our business and the enforcement and performance of our arrangements with customers in certain circumstances. The laws and regulations are sometimes vague and may be subject to future changes, and their official interpretation and enforcement may involve substantial uncertainty. The effectiveness and interpretation of newly enacted laws or regulations, including amendments to existing laws and regulations, may be delayed, and our business may be affected if we rely on laws and regulations which are subsequently adopted or interpreted in a manner different from their understanding of these laws and regulations. New laws and regulations that affect existing and proposed future businesses may also be applied retroactively. We cannot predict what effect the interpretation of existing or new PRC laws or regulations may have on our business.

***Substantial uncertainties in the promulgation, interpretation and enforcement of PRC laws and regulations could limit the legal protections available to you and us.***

The PRC legal system is a civil law system based on written statutes. Unlike the common law system, prior court decisions under the civil law system may be cited for reference but have limited precedential value. Since these laws and regulations are relatively new and the PRC legal system continues to rapidly evolve, the promulgation of new rules and explanations and interpretations of many laws, regulations and rules are not always uniform and enforcement of these laws, regulations and rules involves uncertainties.

In 1979, the PRC government began to promulgate a comprehensive system of laws and regulations governing economic matters in general. The overall effect of legislation over the past three decades has significantly enhanced the protections afforded to various forms of foreign investments in China. However, China has not developed a fully integrated legal system, and recently enacted laws and regulations may not sufficiently cover all aspects of economic activities in China. In particular, the interpretation and enforcement of these laws and regulations involve uncertainties. Specifically, rules and regulations in China can change quickly with little advance notice.

From time to time, we may have to resort to administrative and court proceedings to enforce our legal rights. However, since PRC administrative and court authorities have significant discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to evaluate the outcome of administrative and court proceedings and the level of legal protection we enjoy than in more developed legal systems. Furthermore, the PRC legal system is based in part on government policies and internal rules (some of which are not published in a timely manner or at all) that may have retroactive effect. As a result, we or our PRC subsidiaries may not be aware of our violation of these policies and rules until sometime after the violation. Such uncertainties, including uncertainty over the scope and effect of our contractual, property (including intellectual property) and procedural rights, could materially and adversely affect our PRC subsidiaries' business and impede their ability to continue our operations.

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***Any actions by the Chinese government, including any decision to intervene or influence the operations of the operating entities or to exert control over any offering of securities conducted overseas and/or foreign investment in China-based issuers, may cause us to make material changes to the operations of the PRC operating entities, may limit or completely hinder our ability to continue to offer securities to investors, and may cause the value of such securities to significantly decline or be worthless.***

We are a Cayman Islands holding company and are not a Chinese company. As a holding company with no material operations of our own, we conduct all of our operations through our PRC operating entities in China. As such, our corporate structure involves unique risks to investors. There are legal and operational risks associated with having operations in mainland China, and the Chinese regulatory authorities could disallow this ownership structure, which would likely result in a material change in our operations and/or a material change in the value of the securities we are registering for sale, including that it could cause the value of such securities to significantly decline or become worthless.

In the meeting of the Political Bureau of the Central Committee of the Communist Party of China held on July 30, 2021, the improvement of the regulatory system for overseas listing of enterprises was first proposed. On February 17, 2023, the CSRC released the Trial Measures and five supporting guidelines, which came into effect on March 31, 2023. Pursuant to the Trial Measures, domestic companies that seek to offer or list securities overseas, whether directly or indirectly, should fulfil the filing procedures and submit relevant information to the CSRC.

Although the detailed implementations are still unclear, the supervision of overseas listing of Chinese stocks may continue to tighten. The Chinese government has exercised, and continues to exercise, substantial control over virtually every sector of the Chinese economy through regulation and state ownership. The ability of our operating entities to operate in China may be impaired by changes in its laws and regulations, including those relating to taxation, environmental regulations, land use rights, foreign investment limitations, and other matters. The central or local governments of China may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to our compliance with such regulations or interpretations. As such, we 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.

Furthermore, it is uncertain when and whether we will be required to obtain permission from the PRC government to list on U.S. exchanges in the future, and even when such permission is obtained, whether it will be denied or rescinded. Although we believe that we are currently not required to obtain permission from any Chinese authorities and have not received any notice of denial of permission to list on the U.S. exchange, our operations could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to the PRC operating entities' business or industry, particularly in the event permission to list on U.S. exchanges may be later required, or withheld or rescinded once given.

Accordingly, government actions in the future, including any decision to intervene or influence our operations at any time or to exert control over an offering of securities conducted overseas and/or foreign investment in China-based issuers, may cause us to make material changes to our operations, may limit or completely hinder our ability to continue to offer securities to investors, and/or may cause the value of such securities to significantly decline or be worthless.

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***We may become subject to a variety of laws and regulations in the PRC regarding privacy, data security, cybersecurity, and data protection.***

We may become subject to a variety of laws and regulations in the PRC regarding privacy, data security, cybersecurity, and data protection. These laws and regulations are continuously evolving and developing. The scope and interpretation of the laws that are or may be applicable to us are often uncertain and may be conflicting. In particular, there are a number of laws and regulations regarding privacy and the collection, sharing, use, processing, disclosure, and protection of personal information and other user data. Such laws and regulations often vary in scope, may be subject to differing interpretations, and may be inconsistent among different jurisdictions.

The PRC Criminal Law, as amended by its Amendment 7 (effective on February 28, 2009) and Amendment 9 (effective on November 1, 2015), prohibits institutions, companies and their employees from selling or otherwise illegally disclosing a citizen's personal information obtained during the course of performing duties or providing services or obtaining such information through theft or other illegal ways. On November 7, 2016, the Standing Committee of the PRC National People's Congress (the "NPC") issued the Cyber Security Law of the PRC, or Cyber Security Law, which became effective on June 1, 2017. The Cyber Security Law is the first PRC law that systematically lays out the regulatory requirements on cybersecurity and data protection, subjecting many previously under-regulated or unregulated activities in cyberspace to government scrutiny. Pursuant to the Cyber Security Law, network operators must not, without users' consent, collect their personal information, and may only collect users' personal information necessary to provide their services. Providers are also obliged to provide security maintenance for their products and services and shall comply with provisions regarding the protection of personal information as stipulated under the relevant laws and regulations. The legal consequences of violation of the Cyber Security Law include penalties such as warnings, confiscation of illegal income, suspension of related business, winding up for rectification, shutting down the websites, and revocation of business license or relevant permits. As of the date of this prospectus, we have not been involved in any investigations or cybersecurity reviews by the CAC, and we have not received any inquiry, notice, warning, or sanction in such respect.

The Civil Code of the PRC (issued by the NPC on May 28, 2020, and effective from January 1, 2021) provides the main legal basis for privacy and personal information infringement claims under the Chinese civil laws. PRC regulators, including the CAC, Ministry of Industry and Information Technology, and the Ministry of Public Security, have been increasingly focused on regulation in the areas of data security and data protection. The PRC regulatory requirements regarding cybersecurity are constantly evolving. For instance, various regulatory bodies in China, including the CAC, the Ministry of Public Security and the State Administration for Market Regulation, have enforced data privacy and protection laws and regulations with varying and evolving standards and interpretations.

On July 30, 2021, the State Council promulgated the Regulations on Security Protection of Critical Information Infrastructure, or the CII Regulations, which became effective on September 1, 2021. Pursuant to the CII Regulations, critical information infrastructure refers to any important network facilities or information systems of an important industry or field such as public communication and information service, energy, transport, water conservation, finance, public services, e-government affairs, science and technology industry for national defense and other industries and sectors that may seriously endanger national security, people's livelihood and public interest in case of damage, function loss or data leakage. In addition, relevant administration departments of each critical industry and sector are responsible for formulating eligibility criteria and determining the critical information infrastructure in the respective industry or sector. The operators will be informed about the final determination as to whether they are categorized as critical information infrastructure operators, or CIIOs.

As of the date of this prospectus, no detailed rules or interpretations have been issued and we have not been informed by any governmental authorities that we are a CIIO. However, the exact scope of CIIOs under the current regulatory regime remains unclear, and the PRC governmental authorities have discretion in the interpretation and enforcement of these laws and regulations. Therefore, it is uncertain whether we would be deemed as a CIIO under PRC law. According to our PRC counsel, Guantao Law Firm, if we are identified as CIIO, we will be subject to stricter requirements on business operations and cybersecurity compliance, and we may need to follow cybersecurity review procedure and apply with Cybersecurity Review Office before making certain purchases of network products and services, and if a cybersecurity review is applicable, we may be required to suspend providing any existing or new services to our users, and we may experience other disruptions of our operations.

On November 14, 2021, the CAC published the Security Administration Draft, 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 relevant Cyberspace Administration of the PRC. According to the Security Administration Draft, 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 relevant Cyberspace Administration of the PRC. The deadline for public comments on the Security Administration Draft was December 13, 2021. As of the date of this prospectus, the Security Administration Draft has not been fully implemented.

On December 28, 2021, the CAC and other twelve PRC regulatory authorities jointly revised and promulgated the Measures for Cybersecurity Review, or the Cybersecurity Review Measures. Pursuant to the Cybersecurity Review Measures: (i) "operator of critical information infrastructure" should take the initiative to report to the Cybersecurity Review Office for cybersecurity review when purchasing network products and services which affects or may affect national security; (ii) network platform operators possessing the personal information of more than one million users must apply to the Cybersecurity Review Office for cybersecurity review when list abroad; and (iii) data processor carrying out data processing activities that affect or may affect national security should be subject to cybersecurity review. The Cybersecurity Review Measures further elaborated on the factors to be considered when assessing the national security risks of the relevant activities, including, among others, (a) the risk of core data, important data or a large amount of personal information being stolen, leaked, destroyed, and illegally used or exited the country; and (b) the risk of critical information infrastructure, core data, important data or a large amount of personal information being affected, controlled, or maliciously used by foreign governments after listing abroad.

We believe, in consultation with our PRC counsel, Guantao Law Firm, that we have none of the aforesaid factors in our business, and given that: (i) we have not been informed that we are an operator of critical information infrastructure by any governmental authorities; (ii) we do not possess the personal information of more than one million users; and (iii) the type and nature of the personal information we gather is of relatively low national security significance. However, there remains uncertainty as to how the Cybersecurity Review Measures will be interpreted or implemented and whether the PRC regulatory agencies, including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Cybersecurity Review Measures. If a cybersecurity review is required, we will actively cooperate with the CAC to conduct such cybersecurity review. According to our PRC counsel, any failure to comply with applicable laws or regulations or any other obligations relating to privacy, data protection or information security, or any compromise of security that results in unauthorized access, collection, transfer, use or release of personally identifiable information or other data, or the perception or allegation that any of the foregoing types of failure or compromise has occurred, could damage our reputation or result in investigations, fines, or other penalties by government authorities and private claims or litigation, any of which could materially adversely affect our business, financial condition and results of operations. If any such new laws, regulations, rules, or implementation and interpretation comes into effect, we will take all reasonable measures and actions to comply and to minimize the adverse effect of such laws on us.

On June 10, 2021, the Standing Committee of the NPC promulgated the PRC Data Security Law, which took effect on September 1, 2021. The Data Security Law also sets forth the data security protection obligations for entities and individuals handling personal data, including that no entity or individual may acquire such data by stealing or other illegal means, and the collection and use of such data should not exceed the necessary limits the costs of compliance with, and other burdens imposed by, Cyber Security Law and any other cybersecurity and related laws may limit the use and adoption of our products and services and could have an adverse impact on our business. Any organizational or individual data processing activities that violate the Data Security Law shall bear the corresponding civil, administrative or criminal liabilities depending on specific circumstances. During the fiscal years ended December 31, 2025, 2024, 2023 and 2022, and up to the date of this prospectus, we had not experienced any material data or personal information leakage or loss, infringement of data or personal information, or information security incident, nor had we been subject to or involved in any official inquiry, examination, warning, interview on cybersecurity, data security and personal information protection by relevant competent regulatory authorities.

On August 20, 2021, the Standing Committee of the NPC approved the Personal Information Protection Law ("PIPL"), which became effective on November 1, 2021. The PIPL regulates collection of personal identifiable information and seeks to address the issue of algorithmic discrimination. Companies in violation of the PIPL may be subject to warnings and admonishments, forced corrections, confiscation of corresponding income, suspension of related services, and fines. As of the date of this prospectus, we have not received any personal data protection related administrative warnings or penalties from any competent PRC regulatory authorities.

We cannot assure you that PRC regulatory agencies, including the CAC, would take the same view as we do, and there is no assurance that we and/or our PRC subsidiaries can fully or timely comply with such laws as our business develops. In the event that we or our PRC subsidiaries are subject to any mandatory cybersecurity review and other specific actions required by the CAC, we face uncertainty as to whether any clearance or other required actions can be timely completed, or at all. Given such uncertainty, we and/or our PRC subsidiaries may be further required to suspend the relevant business, or face other penalties, which could materially and adversely affect our business, financial condition, and results of operations. From time to time, we communicate with the competent authorities, including the local branch of the CAC, and expect to closely monitor and assess further regulatory developments regarding cybersecurity and data privacy laws, including the development on cybersecurity review, and comply with the latest regulatory requirements.

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***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 prospectus based on foreign laws.***

We are a company incorporated under the laws of the Cayman Islands. However, we conduct substantially all of our operations through our PRC subsidiaries in China and substantially all of our assets are located in China. In addition, most of our senior executive officers reside within China for a significant portion of the time and many of them are PRC nationals. As a result, it may be difficult for you to effect service of process upon us, or our management named in this prospectus inside mainland China. It may also be difficult for you to enforce in U.S. courts of the judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities laws against us and our officers and directors as none of them currently resides in the United States or has substantial assets located in the United States. In addition, there is uncertainty as to whether the courts of the Cayman Islands or the PRC would recognize or enforce judgments of U.S. courts against us, or such persons predicated upon the civil liability provisions of the securities laws of the United States or any state.

The recognition and enforcement of foreign judgments are 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, regulations and interpretations based either on treaties between China and the country where the judgment is made or on principles of reciprocity between jurisdictions. In addition, according to the PRC Civil Procedures Law, the PRC courts will not enforce a foreign judgment against us or our directors and officers if they decide that the judgment violates 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. Furthermore, class action lawsuits, which are available in the United States for investors to seek remedies, are generally uncommon in China.

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

Shareholder claims or regulatory investigation that are common in the United States 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 providing information needed for regulatory investigations or litigation initiated outside China. Although the 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 cooperation with the securities regulatory authorities in the Unities States may not be efficient in the absence of mutual and practical cooperation mechanism. Furthermore, 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. In addition, entities or individuals are prohibited from providing documents and information in connection with any securities business activities to any organizations and/or persons aboard without the prior consent of the securities regulatory authority of the State Council and the competent departments of the State Council. While detailed interpretation of or implementation 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. See also "Risk Factors — Risks Relating to this Offering, Our Class A Ordinary Shares and the Trading Market — You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands law" for risks associated with investing in us as a Cayman Islands company.

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***If we are classified as a PRC resident enterprise for PRC income tax purposes, such classification could result in unfavorable tax consequences to us and our non-PRC shareholders or ordinary shareholders.***

Under the PRC Enterprise Income Tax Law and its implementation rules, an enterprise established outside of the PRC with "de facto management body" within China is considered a "resident enterprise" and will be subject to the 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, accounts and properties of an enterprise. The Notice Regarding the Determination of Chinese-Controlled Offshore-Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies, which was issued by the State Administration of Taxation on April 22, 2009 and further amended on December 29, 2018, or 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 Circular 82 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" text should be applied in determining the tax resident status of all offshore enterprises. According to 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.

We believe none of our PRC subsidiaries outside of China is 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 we are a PRC resident enterprise for enterprise income tax purposes, we could be subject to PRC tax at a rate of 25% on our worldwide income, which could materially reduce our net income, and we may be required to withhold a 10% withholding tax from dividends we pay to our shareholders that are non-resident enterprises, subject to any reduction set forth in applicable tax treaties. 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 Class A Ordinary Shares, if such income is treated as sourced from within the PRC. Furthermore, if we are deemed a PRC resident enterprise, dividends payable to our non-PRC individual shareholders and any gain realized on the transfer of Class A Ordinary Shares or Class A Ordinary Shares by such shareholders may be subject to PRC tax at a rate of 10% in the case of non-PRC enterprises or a rate of 20% in the case of non-PRC individuals unless a reduced rate is available under an applicable tax treaty. It is unclear whether non-PRC shareholders of our company would be able to claim the benefits of any tax treaties between their country or area 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 Class A Ordinary Shares.

***We face uncertainties with respect to indirect transfer of equity interests in PRC resident enterprises by our non-PRC holding companies.***

In February 2015, the State Administration of Taxation issued the Bulletin on Issues of Enterprise Income Tax on Indirect Transfers of Assets by Non-PRC Resident Enterprises or Bulletin 7. Pursuant to Bulletin 7, an "indirect transfer" of PRC assets, including a transfer of equity interests in an unlisted non-PRC holding company of a PRC resident enterprise, by non-PRC resident enterprises may be re-characterized and treated as a direct transfer of the underlying PRC assets, if such arrangement does not have a reasonable commercial purpose and was established for the purpose of avoiding payment of PRC enterprise income 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.

On October 17, 2017, the State Administration of Taxation issued the Announcement of the State Administration of Taxation on Issues Concerning the Withholding of Non-resident Enterprise Income Tax at Source, or Bulletin 37, which came into effect on December 1, 2017. Bulletin 37 further clarifies the practice and procedure of the withholding of non-resident enterprise income tax.

We face uncertainties on the reporting and consequences of past or future private equity financing transactions, share exchanges or other transactions involving the transfer of shares in our company by investors that are non-PRC resident enterprises. The PRC tax authorities may pursue such non-resident enterprises with respect to a filing or the transferees with respect to withholding obligation, and request our PRC subsidiaries to assist in the filing. As a result, we and non-resident enterprises in such transactions may become at risk of being subject to filing obligations or being taxed under Bulletin 7 and Bulletin 37, and may be required to expend valuable resources to comply with them or to establish that we and our non-resident enterprises should not be taxed under these regulations, which may have a material adverse effect on our financial condition and results of operations.

The PRC tax authorities have the discretion under Bulletin 7 to make adjustments to the taxable capital gains based on the difference between the fair value of the taxable assets transferred and the cost of investment. If the PRC tax authorities make adjustments to the taxable income of the transactions under Bulletin 7, our income tax costs associated with such transactions will be increased, which may have an adverse effect on our financial condition and results of operations. We cannot assure you that the PRC tax authorities will not, at their discretion, adjust any capital gains and impose tax return filing obligations on us or require us to provide assistance to them for the investigation of any transactions we were involved in. Heightened scrutiny over acquisition transactions by the PRC tax authorities may have a negative impact on potential acquisitions we may pursue in the future.

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***Failure to make adequate contributions to various employee benefit plans and withhold individual income tax on employees' salaries as required by PRC regulations or comply with laws and regulations on other employment practices may subject us to penalties.***

Companies operating in China are required to participate in various government sponsored employee benefit plans, including certain social insurance, housing 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 our PRC subsidiaries' employees up to a maximum amount specified by the local government from time to time at locations where our PRC subsidiaries operate their businesses. 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. Companies operating in China are also required to withhold individual income tax on employees' salaries based on the actual salary of each employee upon payment. Our PRC subsidiaries have been making social payments for employee benefits of at least at the minimum wage level for all eligible employees, while the applicable PRC laws and regulations on employee benefits stipulate that employers shall be responsible for making payments based on the actual wage paid to employees. With respect to the underpaid employee benefits, our PRC subsidiaries may be required to complete registrations, make up the contributions for these plans as well as to pay late fees and fines. With respect to the under-withheld individual income tax, our PRC subsidiaries may be required to make up sufficient withholding and pay late fees and fines. If they are subject to late fees or fines in relation to the underpaid employee benefits and under-withheld individual income tax, our financial condition and results of operations may be adversely affected. Our PRC subsidiaries may also be subject to regulatory investigations and other penalties if their other employment practices are deemed to be in violation of relevant PRC laws and regulations.

***The enforcement of the PRC Labor Contract Law and other labor-related regulations in the PRC may subject our PRC subsidiaries to penalties or liabilities.***

The PRC Labor Contract Law, which was enacted in 2008 and amended in 2012, introduced specific provisions related to fixed-term employment contracts, part-time employment, probationary periods, consultation with labor unions and employee assemblies, employment without a written contract, dismissal of employees, severance, and collective bargaining to enhance previous PRC labor laws. Under the Labor Contract Law, an employer is obligated to sign a non-fixed term labor contract with any employee who has worked for the employer for ten consecutive years. Further, if an employee requests or agrees to renew a fixed-term labor contract that has already been entered into twice consecutively, the resulting contract, with certain exceptions, must have non-fixed term, subject to certain exceptions. With certain exceptions, an employer must pay severance to an employee where a labor contract is terminated or expires. In addition, the PRC governmental authorities have continued to introduce various new labor-related regulations since the effectiveness of the Labor Contract Law.

These laws and regulations designed to enhance labor protection tend to increase our labor costs. In addition, as the interpretation and implementation of these regulations are still evolving, our PRC subsidiaries' employment practices may not at all times be deemed in compliance with the regulations. As a result, we could be subject to penalties or incur significant liabilities in connection with labor disputes or investigations.

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***The M&A Rules and certain other PRC regulations may make it more difficult for us to pursue growth through acquisitions.***

The Regulations on Mergers and Acquisitions of Domestic Companies by Foreign Investors, or the M&A Rules, adopted by six PRC regulatory agencies in 2006 and amended in 2009, and some other regulations and rules concerning mergers and acquisitions established complex procedures and requirements for acquisition of Chinese companies by foreign investors, including requirements in some instances that the Ministry of Commerce of the PRC be notified in advance of any change-of-control transaction in which a foreign investor takes control of a PRC domestic enterprise. Moreover, the Anti-Monopoly Law promulgated by the Standing Committee of the NPC, which became effective in 2008, requires that where the concentration of business operators reaches the filing thresholds stipulated by the State Council, business operators shall file a declaration with the State Administration for Market Regulation, or SAMR, and no concentration shall be implemented until the SAMR clears the anti-monopoly filing. In addition, the security review rules issued by the Ministry of Commerce and became effective in September 2011 specify that mergers and acquisitions by foreign investors that raise "national defense and security" concerns and mergers and acquisitions through which foreign investors may acquire de facto control over domestic enterprises that raise "national security" concerns are subject to strict review by the Ministry of Commerce, and the rules prohibit any activities attempting to bypass a security review, including by structuring the transaction through a proxy or contractual control arrangement.

In the future, we may pursue potential strategic acquisitions that are complementary to our business and operations. Complying with the requirements of the above-mentioned regulations and other rules to complete such transactions could be time-consuming, and any required approval processes, including obtaining approval or clearance from the Ministry of Commerce, may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or maintain our market share. Furthermore, according to the M&A Rules, if a PRC entity or individual plans to merger or acquire its related PRC entity through an overseas company legitimately incorporated or controlled by such entity or individual, such a merger and acquisition will be subject to examination and approval by the Ministry of Commerce. The application and interpretations of M&A Rules are still uncertain, and there is possibility that the PRC regulators may promulgate new rules or explanations requiring that us obtain approval of the Ministry of Commerce for our completed or ongoing mergers and acquisitions. There is no assurance that we can obtain such approval from the Ministry of Commerce for our mergers and acquisitions, and if we fail to obtain those approvals, we may be required to suspend our acquisition and be subject to penalties. Any uncertainties regarding such approval requirements could have a material adverse effect on our business, results of operations and corporate structure.

***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 addition, any failure to comply with PRC regulations with respect to registration requirements for offshore financing may subject us to legal or administrative sanctions.***

In July 2014, 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 requires PRC residents (including PRC individuals and PRC corporate entities as well as foreign individuals that are deemed as PRC residents for foreign exchange administration purpose) to register with SAFE or its local branches in connection with their direct or indirect offshore investment activities. SAFE Circular 37 further requires amendment to the SAFE registrations in the event of any changes with respect to the basic information of the offshore special purpose vehicle, such as change of a PRC individual shareholder, name and operation term, or any significant changes with respect to the offshore special purpose vehicle, such as increase or decrease of capital contribution, share transfer or exchange, or mergers or divisions. 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.

Under these foreign exchange regulations, PRC residents who make, or have previously made, prior to the implementation of these foreign exchange regulations, direct or indirect investments in offshore companies are required to register those investments. In addition, any PRC resident who is a direct or indirect shareholder of an offshore company is required to update its previously filed SAFE registration, to reflect any material change involving its round-trip investment. If any PRC shareholder fails to make the required registration or update the previously filed registration, the PRC subsidiary of that offshore parent company may be restricted from distributing their profits and the proceeds from any reduction in capital, share transfer or liquidation to their offshore parent company, and the offshore parent company may also be restricted from injecting additional capital into its PRC subsidiary. Moreover, failure to comply with the various foreign exchange registration requirements described above could result in liability under PRC laws for evasion of applicable foreign exchange restrictions, including (i) the requirement by SAFE to return the foreign exchange remitted overseas or into the PRC within a period of time specified by SAFE, with a fine of up to 30% of the total amount of foreign exchange remitted overseas or into PRC and deemed to have been evasive or illegal and (ii) in circumstances involving serious violations, a fine of no less than 30% of and up to the total amount of remitted foreign exchange deemed evasive or illegal.

We are committed to complying with and to ensuring that our shareholders who are subject to these regulations will comply with the SAFE rules and regulations. However, due to the inherent uncertainty in the implementation of the regulatory requirements by the PRC authorities, such registration might not be always practically available in all circumstances as prescribed in those regulations. In addition, we may not always be able to compel them to comply with SAFE Circular 37 or other related regulations. We cannot assure you that SAFE or its local branches will not release explicit requirements or interpret the PRC laws and regulations otherwise. We may not be fully informed of the identities of all our shareholders or beneficial owners who are PRC residents, and we cannot provide any assurance that all of our shareholders and beneficial owners who are PRC residents will comply with our request to make, obtain or update any applicable registrations or comply with other requirements under SAFE Circular 37 or other related rules in a timely manner.

Because there is uncertainty concerning the reconciliation of these foreign exchange regulations with other approval requirements, it is unclear how these regulations, and any future regulation concerning offshore or cross-border transactions, will be interpreted, amended and implemented by the governmental authorities. We cannot predict how these regulations will affect our business operations or future strategy. For example, we may be subject to a more stringent review and approval process with respect to our foreign exchange activities, such as remittance of dividends and foreign-currency-denominated borrowings, which may adversely affect our results of operations and financial condition. This may restrict our ability to implement our acquisition strategy and could adversely affect our business and prospects.

In addition, our offshore financing activities, such as the issuance of foreign debt, are also subject to PRC laws and regulations. In accordance with such laws and regulations, we may be required to complete filing and registration with the National Development and Reform Commission prior to such activities. Failure to comply with the requirements may result in administrative meeting, warning, notification and other regulatory penalties and sanctions.

***We may be materially adversely affected if our shareholders and beneficial owners who are PRC entities fail to comply with the PRC overseas investment regulations.***

On December 26, 2017, the National Development and Reform Commission, or NDRC, promulgated the Administrative Measures on Overseas Investments, which took effect as of March 1, 2018. According to this regulation, non-sensitive overseas investment projects are subject to record-filing requirements with the local branch of the NDRC. On September 6, 2014, the Ministry of Commerce promulgated the Administrative Measures on Overseas Investments, which took effect as of October 6, 2014. According to this regulation, overseas investments of PRC enterprises that involve non-sensitive countries and regions and non-sensitive industries are subject to record-filing requirements with a local branch of Ministry of Commerce. According to the Circular of the State Administration of Foreign Exchange on Issuing the Regulations on Foreign Exchange Administration of the Overseas Direct Investment of Domestic Institutions, which was promulgated by the State Administration of Foreign Exchange, or SAFE, on July 13, 2009 and took effect on August 1, 2009, PRC enterprises must register for overseas direct investment with a local SAFE branch.

We may not be fully informed of the identities of all of our shareholders or beneficial owners who are PRC entities, and we cannot provide any assurance that all of our shareholders and beneficial owners who are PRC entities will comply with our request to complete the overseas direct investment procedures under the aforementioned regulations or other related rules in a timely manner, or at all. If they fail to complete the filings or registrations required by the overseas direct investment regulations, the authorities may order them to suspend or cease the implementation of such investment and make corrections within a specified time, which may adversely affect our business, financial condition and results of operations.

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***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 requirements, including the funds necessary to pay dividends and other cash distributions to our shareholders for services of any debt we may incur. If any of our PRC subsidiaries incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other distributions to us. Under PRC laws and regulations, our PRC subsidiaries, which are foreign-owned enterprises, may pay dividends only out of their respective accumulated profits, as determined in accordance with PRC accounting standards and regulations. In addition, a foreign-owned enterprise is required to set aside at least 10% of its accumulated after-tax profits each year, if any, to fund a certain statutory reserve fund, until the aggregate amount of such fund reaches 50% of its registered capital. Such reserve funds cannot be distributed to us as dividends. Some of our subsidiaries are required to allocate general risk reserves prior to the distribution of dividends.

Our PRC subsidiaries generate essentially all of their revenue in Renminbi, which is not freely convertible into other currencies. As a result, any restriction on currency exchange may limit the ability of our PRC subsidiaries to use their Renminbi revenue to pay dividends to us.

The PRC government may continue to strengthen its capital controls, and more restrictions and substantial vetting process may be put forward by SAFE for cross-border transactions falling under both the current account and the capital account. Any limitation on the ability of our PRC subsidiaries to pay dividends or make other kinds of payments 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 Enterprise Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements between the PRC central government and governments of other countries or regions where the non-PRC-resident enterprises are incorporated.

***To the extent cash or assets of our business, or of our PRC or Hong Kong subsidiaries, is in mainland China or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets.***

The transfer of funds and assets among the Company, its Hong Kong and PRC subsidiaries is subject to governmental control and restriction. The competent PRC government imposes controls on the conversion of the RMB into foreign currencies and the remittance of currencies out of mainland China. In addition, the PRC Enterprise Income Tax Law and its implementation rules provide that a withholding tax at a rate of 10% will be applicable to dividends payable by Chinese companies to enterprises that are not mainland China resident enterprises, unless reduced under treaties or arrangements between the PRC central government and the governments of other countries or regions where the enterprises that are not mainland China resident enterprises are tax resident.

As of the date of this prospectus, 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 the transfer of funds involving 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 of our business, or of our PRC or Hong Kong subsidiaries, is in mainland China or Hong Kong, such funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to interventions in or the imposition of restrictions and limitations by the competent government to the transfer of cash or assets.

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***You may be subject to PRC income tax on dividends from us or on any gain realized on the transfer of our Class A Ordinary Shares.***

Under the Enterprise Income Tax Law and its implementation rules, PRC withholding tax at a rate of 10% is generally applicable to dividends from PRC sources paid to investors that are resident enterprises outside of China and that do not have an establishment or place of business in China, or that have an establishment or place of business in China if the income is not effectively connected with the establishment or place of business. Any gain realized on the transfer of shares by such investors is subject to 10% PRC income tax if this gain is regarded as income derived from sources within China. Under the PRC Individual Income Tax Law and its implementation rules, dividends from sources within China paid to foreign individual investors who are not PRC residents are generally subject to a PRC withholding tax at a rate of 20% and gains from PRC sources realized by these investors on the transfer of shares are generally subject to 20% PRC income tax. Any such PRC tax liability may be reduced by the provisions of an applicable tax treaty.

Although all of our business operations are conducted by our PRC subsidiaries in China, it is unclear whether the dividends we pay with respect to our Class A Ordinary Shares, or the gains realized from the transfer of our shares, would be treated as income derived from sources within China and as a result be subject to PRC income tax if we are considered a PRC resident enterprise. If PRC income tax is imposed on gains realized through the transfer of our Class A Ordinary Shares or on dividends paid to our non-resident investors, the value of your investment in our Class A Ordinary Shares may be materially and adversely affected. Furthermore, our shareholders whose jurisdictions of residence have tax treaties or arrangements with China may not qualify for benefits under these tax treaties or arrangements.

In addition, pursuant to the Double Tax Avoidance Arrangement between Hong Kong and China, if a Hong Kong resident enterprise owns more than 25% of the equity interest of a PRC company at all times during the twelve-month period immediately prior to obtaining a dividend from such company, the 10% withholding tax on the dividend is reduced to 5%, provided that certain other conditions and requirements are satisfied at the discretion of the PRC tax authority. However, based on the Notice on Certain Issues with Respect to the Enforcement of Dividend Provisions in Tax Treaties, issued in 2009 by the State Administration of Taxation, if the PRC tax authorities determine, in their discretion, that a company benefits from the reduced income tax rate due to a structure or arrangement that is primarily tax-driven, the PRC tax authorities may adjust the preferential tax treatment. If our Hong Kong subsidiaries are determined by PRC government authorities as receiving benefits from reduced income tax rates due to a structure or arrangement that is primarily tax-driven, the dividends paid by our PRC subsidiaries to our Hong Kong subsidiaries will be taxed at a higher rate, which will have a material adverse effect on our financial performance.

***PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent us from using the proceeds of the initial public offering to make loans or additional capital contributions to our PRC subsidiaries and our consolidated affiliated entities in China, which could materially and adversely affect our liquidity and our ability to fund and expand our business.***

We are an offshore holding company conducting our operations in China through our PRC subsidiaries. We may make loans to our PRC subsidiaries, or we may make additional capital contributions to our PRC subsidiaries, or we may establish new PRC subsidiaries and make capital contributions to these new PRC subsidiaries, or we may acquire offshore entities with business operations in China in an offshore transaction.

Most of these ways are subject to PRC regulations and approvals or registration. For example, loans by us to our wholly owned PRC subsidiaries to finance their activities cannot exceed statutory limits and must be registered with the local counterpart of SAFE. If we decide to finance our wholly owned PRC subsidiary by means of capital contributions, these capital contributions are subject to registration with the State Administration for Market Regulation or its local branch, reporting of foreign investment information with the PRC Ministry of Commerce, or registration with other governmental authorities in China. Due to the restrictions imposed on loans in foreign currencies extended to PRC domestic companies, we are not likely to make such loans to our consolidated affiliated entities, which is a PRC domestic company. Further, we are not likely to finance the activities of our consolidated affiliated entities by means of capital contributions due to regulatory restrictions relating to foreign investment in PRC domestic enterprises engaged in certain businesses.

SAFE promulgated the Notice of the State Administration of Foreign Exchange on Reforming the Administration of Foreign Exchange Settlement of Capital of Foreign-invested Enterprises, or SAFE Circular 19, effective June 2015, in replacement of the Circular on the Relevant Operating Issues Concerning the Improvement of the Administration of the Payment and Settlement of Foreign Currency Capital of Foreign-Invested Enterprises, the Notice from the State Administration of Foreign Exchange on Relevant Issues Concerning Strengthening the Administration of Foreign Exchange Businesses, and the Circular on Further Clarification and Regulation of the Issues Concerning the Administration of Certain Capital Account Foreign Exchange Businesses. According to SAFE Circular 19, the flow and use of the RMB capital converted from foreign currency-denominated registered capital of a foreign-invested company is regulated such that RMB capital may not be used for the issuance of RMB entrusted loans, the repayment of inter-enterprise loans or the repayment of banks loans that have been transferred to a third party. Although SAFE Circular 19 allows RMB capital converted from foreign currency-denominated registered capital of a foreign-invested enterprise to be used for equity investments within China, it also reiterates the principle that RMB converted from the foreign currency-denominated capital of a foreign-invested company may not be directly or indirectly used for purposes beyond its business scope. Thus, it is unclear whether SAFE will permit such capital to be used for equity investments in China in actual practice. SAFE promulgated the Notice of the State Administration of Foreign Exchange on Reforming and Standardizing the Foreign Exchange Settlement Management Policy of Capital Account, or SAFE Circular 16, effective on June 9, 2016, which reiterates some of the rules set forth in SAFE Circular 19, but changes the prohibition against using RMB capital converted from foreign currency-denominated registered capital of a foreign-invested company to issue RMB entrusted loans to a prohibition against using such capital to issue loans to non-associated enterprises. Violations of SAFE Circular 19 and SAFE Circular 16 could result in administrative penalties. SAFE Circular 19 and SAFE Circular 16 may significantly limit our ability to transfer any foreign currency we hold, including the net proceeds from the initial public offering, to our PRC subsidiaries, which may adversely affect our liquidity and our ability to fund and expand our business in China. On October 25, 2019, the SAFE promulgated the Notice for Further Advancing the Facilitation of Cross-border Trade and Investment, or the SAFE Circular 28, which, among other things, allows all foreign-invested companies to use Renminbi converted from foreign currency-denominated capital for equity investments in China, as long as the equity investment is genuine, does not violate applicable laws, and complies with the negative list on foreign investment. However, since the SAFE Circular 28 is newly promulgated, it is unclear how SAFE and competent banks will carry this out in practice.

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, or at all, with respect to future loans to our PRC subsidiaries or consolidated affiliated entities or future capital contributions by us to our PRC subsidiaries. As a result, uncertainties exist as to our ability to provide prompt financial support to our PRC subsidiaries or consolidated affiliated entities when needed, and our ability to use the proceeds we receive from the initial public 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.

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

The conversion of Renminbi into foreign currencies, including U.S. dollars, is based on rates set by the People's Bank of China. The Renminbi has fluctuated against the U.S. dollar, at times significantly and unpredictably. The value of Renminbi against the U.S. dollar and other currencies is affected by changes in China's political and economic conditions and by China's foreign exchange policies, among other things. We cannot assure you that Renminbi will not appreciate or depreciate significantly in value against the U.S. dollar in the future. It is difficult to predict how market forces or the PRC or U.S. government policy may impact the exchange rate between Renminbi and the U.S. dollar in the future.

Substantially all of our income and expenses are denominated in Renminbi and our reporting currency is Renminbi. Significant revaluation of the Renminbi may have a material and adverse effect on your investment. For example, to the extent that we need to convert U.S. dollars we receive from our initial public offering into Renminbi for our operations, appreciation of the Renminbi against the U.S. dollar would reduce the Renminbi amount we would receive from the conversion. Conversely, if we decide to convert our Renminbi into U.S. dollars for the purpose of paying dividends or for other business purposes, appreciation of the U.S. dollar against the Renminbi would reduce the U.S. dollar amount available to us.

Very limited hedging options are available in China to reduce our exposure to exchange rate fluctuations. To date, we have not entered into any hedging transactions in an effort to reduce our exposure to foreign currency exchange risk. While we may decide to enter into hedging transactions in the future, the availability and effectiveness of these hedges may be limited and we may not be able to hedge our exposure adequately or at all. In addition, our currency exchange losses may be magnified by PRC exchange control regulations that restrict our ability to convert Renminbi into foreign currency.

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***Governmental control of currency conversion may limit our ability to utilize our income effectively and affect the value of your investment.***

The PRC government imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. We receive substantially all of our income in Renminbi. Under our current corporate structure, our Cayman Islands holding company may rely on dividend payments from our PRC subsidiaries to fund any cash and financing requirements payable outside of China. 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 SAFE by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, cash generated from the operations of our PRC subsidiaries in China may be used to pay dividends to our company without prior approval of SAFE. However, approval from or registration with appropriate government authorities is required where Renminbi 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 SAFE approval to use cash generated from the operations of our PRC subsidiaries and Consolidated affiliated entity to pay any debts they may incur 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 Renminbi.

In addition, if any of our shareholders who is subject to SAFE regulations fails to satisfy the applicable overseas direct investment filing or approval requirement, the PRC government may restrict our access to foreign currencies for current account transactions. If we are prevented from obtaining sufficient foreign currency to satisfy our foreign currency demands, we may not be able to pay dividends in foreign currencies to our shareholders.

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***If the chops of our PRC subsidiaries are not kept safely, are stolen or are used by unauthorized persons or for unauthorized purposes, the corporate governance of these entities could be severely and adversely compromised.***

In China, a company chop or seal serves as the legal representation of the company towards third parties even when unaccompanied by a signature. Each legally registered company in China is required to maintain a company chop, which must be registered with the local Public Security Bureau. In addition to this mandatory company chop, companies may have several other chops which can be used for specific purposes. The chops of our PRC subsidiaries are generally held securely by personnel designated or approved by our PRC subsidiaries in accordance with their respective internal control procedures. To the extent those chops are not kept safely, are stolen or are used by unauthorized persons or for unauthorized purposes, the corporate governance of these entities could be severely and adversely compromised and those corporate entities may be bound to abide by the terms of any documents so chopped, even if they were chopped by an individual who lacked the requisite power and authority to do so. In addition, if the chops are misused by unauthorized persons, the impacted PRC subsidiary could experience disruption to its normal business operations. Our PRC subsidiaries may have to take corporate or legal action, which could involve significant time and resources to resolve while distracting management from their operations.

***The PRC government exerts substantial influence over the manner in which we and our PRC subsidiaries must conduct our business activities. We are currently not required to obtain approval from Chinese authorities to list on U.S. exchanges, however, if we or our PRC subsidiaries are required to obtain approval in the future and are denied permission from Chinese authorities to list on U.S. exchanges, we will not be able to continue listing on U.S. exchanges, which would materially affect the interest of the investors.***

The PRC government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our PRC subsidiaries' 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 data security, anti-monopoly policies, or local PRC governments may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts of our PRC subsidiaries to ensure their 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 the PRC or particular regions thereof, and could require us to divest ourselves of any interest we then hold in Chinese properties.

On July 6, 2021, 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 Strictly Cracking Down on Illegal Securities Activities, or the Opinions, which emphasized the need to strengthen administration over illegal securities activities and supervision of overseas listings by China-based companies. The Opinions proposed promoting regulatory systems to deal with risks facing China-based overseas-listed companies, and provided that the State Council will revise provisions regarding the overseas issuance and listing of shares by companies limited by shares and will clarify the duties of domestic regulatory authorities. However, the Opinions did not provide detailed rules and regulations. As a result, uncertainties remain regarding the interpretation and implementation of the Opinions.

Since 2021, the Chinese government has strengthened its anti-monopoly supervision, mainly in three aspects: (1) establishing the National Anti-Monopoly Bureau; (2) revising and promulgating anti-monopoly laws and regulations, including: the Anti-Monopoly Law (draft Amendment published on October 23, 2021 for public opinions; the newly revised Anti-Monopoly Law was promulgated on June 24, 2022, and became effective on August 1, 2022), the anti-monopoly guidelines for various industries, and the detailed Rules for the Implementation of the Fair Competition Review System; and (3) expanding the anti-monopoly law enforcement targeting Internet companies and large enterprises. As of the date of this prospectus, the Chinese government's recent statements and regulatory actions related to anti-monopoly concerns have not impacted our ability to conduct business, accept foreign investments, or list on a U.S. or other foreign exchange because neither the Company nor its PRC operating entities engage in monopolistic behaviors that are subject to these statements or regulatory actions.

On February 17, 2023, the CSRC released the Trial Measures and five supporting guidelines, which came into effect on March 31, 2023. According to the Trial Measures, among other things, a domestic company in the PRC that seeks to offer and list securities on overseas markets shall fulfill the filing procedures with the CSRC as per requirement of the Trial Measures. This includes subsequent securities offerings of the company in the same overseas market where it has previously offered and listed securities, which requires a company, such as ours, to file with the CSRC within three working days after the subsequent securities offering is completed. We believe, based on the advice of our PRC counsel, Guantao Law Firm, that, as this offering is regarded as a subsequent securities offering in the same overseas market under the Trial Measures, we are required to complete the filing procedures with the CSRC in accordance with the Trial Measures with respect to this offering, and we will submit our filing application to the CSRC within three working days after the completion of this offering.

On February 24, 2023, the CSRC and other relevant government authorities promulgated the Provisions on Strengthening the Confidentiality and Archives Administration of Overseas Securities Issuance and Listing by Domestic Enterprises, which requires a domestic enterprise that intends to provide or publicly disclose through its overseas listing entities, any document or material involving any state secret or any work secret of any government organ, shall report the same to the competent department with examination and approval authority for approval in accordance with the law, and file the same with the administrative department of secrecy at the same level for the record.

As such, we 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. It is uncertain when and whether we will be required to obtain permission from the PRC government to list on U.S. exchanges in the future, and even when such permission is obtained, whether it will be denied or rescinded. Although we are currently not required to obtain permission from any of the PRC federal or local government to obtain such permission and have not received any denial to list on the U.S. exchange, our operations could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to its business or industry.

***The Holding Foreign Companies Accountable Act and the Accelerating Holding Foreign Companies Accountable Act call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB. These developments could add uncertainties to our continued listing on the Nasdaq Capital Market, and Nasdaq may determine to delist our securities if the PCAOB determines that it cannot inspect or fully investigate our auditor.***

On April 21, 2020, the former SEC Chairman, Jay Clayton, and PCAOB Chairman William D. Duhnke III, along with other senior SEC staff, released a joint statement highlighting the risks associated with investing in companies based in or have substantial operations in emerging markets including China. The joint statement emphasized the risks associated with lack of access for the PCAOB to inspect auditors and audit work papers in China and higher risks of fraud in emerging markets.

On May 18, 2020, Nasdaq filed three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating in "Restrictive Market", (ii) adopt a new requirement relating to the qualification of management or board of director for Restrictive Market companies, and (iii) apply additional and more stringent criteria to an applicant or listed company based on the qualifications of the company's auditors.

On December 18, 2020, the HFCAA was signed by President Donald Trump and became law. This legislation requires certain issuers of securities to establish that they are not owned or controlled by a foreign government. Specifically, an issuer must make this certification if the PCAOB is unable to audit specified reports because the issuer has retained a foreign public accounting firm not subject to inspection by the PCAOB. Furthermore, if the PCAOB is unable to inspect the issuer's public accounting firm for three consecutive years beginning in 2021, the issuer's securities are banned from trade on a national exchange or through other methods.

On November 5, 2021, the SEC approved the PCAOB's Rule 6100, Board Determinations Under the HFCAA. Rule 6100 provides a framework for the PCAOB to use to determine whether it is unable to inspect or investigate registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction.

On December 2, 2021, The SEC adopted amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA. The rules apply to registrants the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that the PCAOB is unable to inspect or investigate.

On December 16, 2021, the PCAOB issued a report on its determinations that the Board is unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China and in Hong Kong, a Special Administrative Region of the PRC, because of positions taken by PRC authorities in those jurisdictions (the "Determination"). The Board made these determinations pursuant to PCAOB Rule 6100, which provides a framework for how the PCAOB fulfills its responsibilities under the HFCAA.

On August 26, 2022, the CSRC, MOF, and the PCAOB signed the Protocol, governing inspections and investigations of audit firms based in China and Hong Kong, taking the first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong. Pursuant to the fact sheet with respect to the Protocol disclosed by the SEC, the PCAOB shall have independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC.

On December 15, 2022, the PCAOB determined that it was able to secure complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong and vacated its previous determinations to the contrary. However, should PRC authorities obstruct or otherwise fail to facilitate the PCAOB's access in the future, the PCAOB may consider the need to issue a new determination.

On December 29, 2022, the Accelerating Holding Foreign Companies Accountable Act was signed into law as part of the Consolidated Appropriations Act, which amended the HFCAA by reducing the number of consecutive non-inspection years required for triggering the prohibitions under the HFCAA from three years to two.

Any lack of access to the PCAOB inspection in China may prevent the PCAOB from fully evaluating audits and quality control procedures of the auditors based in China. As a result, the investors may be deprived of the benefits of such PCAOB inspections. The inability of the PCAOB to conduct inspections of auditors in China makes it more difficult to evaluate the effectiveness of these accounting firms' audit procedures or quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections, which could cause existing and potential investors to lose confidence in audit procedures and reported financial information and the quality of financial statements of China-based companies.

Our former auditor, Onestop, was replaced by HHL on July 31, 2025. HHL, a PCAOB-registered public accounting firm headquartered in New York, was subsequently dismissed and replaced by HCL as our independent registered public accounting firm, effective January 13, 2026. Both our current auditor, HCL, and former auditors, HHL and Onestop, are subject to oversight by the PCAOB, which conducts regular inspections to assess compliance with applicable professional standards. Our current auditor, HCL, is headquartered at 1415 W 37th Street, Suite 200, Chicago, IL 60609, and expects to be inspected by the PCAOB on a regular basis, as required by U.S. law. As of the date of this prospectus, we have not been affected by the HFCAA and related regulations. We cannot assure you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness of our auditor's audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach or experience as related to the audit of our financial statements. Furthermore, there is a risk that our auditor cannot be inspected by the PCAOB in the future. The lack of inspection could cause trading in our securities to be prohibited on a national exchange or in the over-the-counter trading market under the HFCAA, and, as a result, Nasdaq may determine to delist our securities, which may cause the value of our securities to decline or become worthless.

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***Changes in international trade policies, or the escalation of tensions in international relations, particularly with regard to China, may adversely impact our business and operating results.***

 **

There have been heightened tensions in international relations, particularly between the United States and China, in recent years. The U.S. government has made statements and taken certain actions that may lead to potential changes to U.S. and international trade policies towards China. It remains unclear if unfavorable government policies on international trade, such as capital controls or tariffs, or the U.S. dollar payment and settlement system may affect the demand for the operating entity's products, impact the competitive position of the products, prevent the operating entity from selling products in certain countries, or even our participation in the U.S. dollar payment and settlement system, which would materially and adversely affect the international operations, results of operations and financial condition. If any new tariffs, legislation and/or regulations are implemented, or if existing trade agreements are renegotiated or, in particular, if the U.S. government takes retaliatory trade actions due to the recent U.S.-China trade tensions, such changes could have an adverse effect on our business, financial condition and results of operations.

In addition to trade related tensions between China and the United States, the U.S. government escalated tensions between the U.S. and China in recent years by revoking Hong Kong's special trading status. Also, the Congress of the United States enacted the Uyghur Forced Labor Prevention Act (the "UFLPA") in December 2021. Effective from June 21, 2022, the UFLPA creates a rebuttable presumption that goods mined, produced, or manufactured (wholly or in part) in China's Xinjiang Uyghur Autonomous Region are made with forced labor, where goods designated as such will be subject to an import ban into the United States. The President of the United States may also impose sanctions on companies that knowingly engage in, are responsible for, or facilitate forced labor in Xinjiang. As of the date of this prospectus, we do not have any operations in Xinjiang Uyghur Autonomous Region, and our business is not impacted by the UFLPA.

Moreover, recently, the war in Ukraine and sanctions on Russia have increased the uncertainties in the relations between China and the United States, and tensions between these two countries could be heightened as a result. These tensions have affected both diplomatic and economic ties between the two countries. Heightened tensions could reduce levels of trade, investments, technological exchanges, and other economic activities between the two major economies. The impacts of the war in Ukraine and sanctions on Russia to our business are very limited because the operating subsidiaries do not source their raw materials from the European Union, Russia, or Ukraine and can seek alternative suppliers to their current suppliers in China without undue cost or effort. The prices of main raw materials used in the products were stable in fiscal years ended December 31, 2025 and 2024. However, the existing tensions and any further deterioration in international relations may have a negative impact on the general, economic, political, and social conditions in China and, given our reliance on the Chinese market, adversely impact our business, financial condition, and results of operations.

***Trade disputes or the imposition of tariffs on imports and exports could affect international trade, and therefore could adversely affect our business.***

Since 2018, China and the United States each began implementing increasingly protective trade measures, including significant tariff increases, in a trade war between these countries. Beginning in February 2025, President Trump has announced new tariffs on imports, including 10% tariffs on virtually all imports to the United States, and higher tariffs on imports of certain products or from certain countries (including Canada, Mexico and China). In response, foreign governments, including China, have enacted retaliatory tariffs. It is unknown whether and to what extent new tariffs will be adopted, or the effect that any such actions would have on us, our business partners or our industry.

Trade barriers to protect domestic industries against foreign imports depress trading demand. Protectionist developments, such as the imposition of trade tariffs or the perception they may occur, may have a material adverse effect on global economic conditions, and may significantly reduce global trade. Moreover, increasing trade protectionism may cause an increase in (a) the cost of goods exported from regions globally, (b) the length of time required to transport goods, and (c) the risks associated with exporting goods. Such increases may significantly affect the quantity of goods to be traded, shipping time schedules, voyage costs and other associated costs, which could have an adverse impact on the Chinese economy and our business, operating results and financial condition. Further, protectionist policies in any country could impact global markets, including foreign exchange and securities markets. Any resulting changes in currency exchange rates, tariffs, treaties and other regulatory matters could in turn adversely impact our business, results of operations, financial condition and cash flows.

**Risks Relating to Our Business and Industry**

***We have incurred substantial losses in the past and may incur losses in the future. There is substantial doubt about our ability to continue as a going concern.***

As discussed in "Note 3" to the consolidated financial statements to this prospectus, we have suffered significant losses from operations, resulting in a material decrease in working capital that raises substantial doubt about our ability to continue as a going concern. For the fiscal year ended December 31, 2024, we reported a net loss of RMB56,362, negative operating cash flow of RMB73,170 and an accumulated deficit of RMB221,098. For the fiscal year ended December 31, 2023, we reported a net loss of RMB25,466,000, negative operating cash flow of RMB65,442,000, net current assets of RMB88,316,000, and an accumulated deficit of RMB173,176,000.

Our former auditor, Onestop Assurance PAC, has indicated in its reports on our financial statements for the fiscal years ended December 31, 2023 and 2024, that there is substantial doubt as to our ability to continue as a going concern for the next 12 months from respective the date of issuance of the consolidated financial statements. Such substantial doubt could impair our ability to finance our operations through the sale of equity, incurring debt, or other financing alternatives. In assessing its liquidity, management monitors and analyzes the Company's cash on-hand, its ability to generate sufficient revenue sources and ability to obtain additional financial support in the future, and its operating and capital expenditure commitments.

Management's plan to alleviate the substantial doubt about our ability to continue as a going concern includes the following measures:

&nbsp;&nbsp;&nbsp;&nbsp;(i) Obtaining financial support
and credit guarantees from major shareholders;

&nbsp;&nbsp;&nbsp;&nbsp;(ii) Taking various cost control
measures to tighten the costs of operations;

&nbsp;&nbsp;&nbsp;&nbsp;(iii) Speeding up the production
cycle and shortening the delivery term to improve receivable turnover;

&nbsp;&nbsp;&nbsp;&nbsp;(iv) Implementing various strategies
to enhance sales and profitability; and

&nbsp;&nbsp;&nbsp;&nbsp;(v) Equity financing.

However, there can be no assurance that additional financing, if required, would be available on favorable terms or at all or that the foregoing plans and measures will be sufficient to fund our ongoing capital expenditures, working capital, and other requirements.

***We have limited operating history in an emerging and fast-growing market, and our historical financial and operating performance may not be indicative of our future prospects and results of operations.***

The automotive market in the PRC, especially the EV market, is relatively new and evolving rapidly. While the EV market has undergone significant growth in the past few years, notwithstanding the slight reduction in growth attributable to the impact from the COVID-19 pandemic and the reduction of government subsidies, there is no assurance that it can continue to grow as rapidly. We established AHYS in 2013, which entity, together with the other operating subsidiaries, has had limited operating history. We may not have sufficient experience to address the risks to which companies operating in new or rapidly evolving markets may be exposed. We have limited experience in the EV industry. The laws and regulations governing the EV industry in the PRC are still at a nascent stage and subject to further changes and interpretations. As the market, the regulatory environment or other conditions evolve, our existing products and service offerings may not continue to deliver the expected business results. As our business develops, we may continue to introduce new products and services, make adjustments to existing products and services, to our business model or to our operations in general. Our abilities to retain and attract new sourcing partners, cooperating automobile manufacturers, and other third parties are also critical to our business. Any significant change to our business model or failure to achieve the intended business results may have a material and adverse impact on our financial condition and results of operations. Therefore, it may be difficult to effectively assess our future prospects.

You should consider our business and prospects in light of the risks and challenges that we encounter or may encounter, given the rapidly-evolving market in which they operate and their limited operating history. These risks and challenges include our ability to, among other things:

● maintain and enhance relationships with sourcing partners, cooperating automobile manufacturers, and other third parties;

● comply with complex and evolving laws and regulations;

● improve operational efficiency;

● attract, retain and motivate talented employees, particularly in the areas of research and development, sales and marketing, as well as risk management;

● enhance technology infrastructure to support the growth of business and maintain the security of our data system and the confidentiality of the information provided and collected across such system;

● navigate economic conditions and fluctuations;

● implement business strategies entering into the EV market; and

● defend against legal and regulatory actions, such as actions involving intellectual property or data privacy claims.

***We face intense competition and may not be able to compete effectively.***

The automotive market in China is large yet competitive. We compete against other sourcing service providers, such as 4S dealerships, brand-owned stores/direct authorized dealerships, and automobile e-commerce platforms. Competitors may offer better prices and/or deliver better user experiences to prospective customers/users. We may also face future competition from new entrants that could intensify the market competition. We anticipate that more established companies, including technology companies that possess large, existing user bases, substantial financial resources and sophisticated technological capabilities may also enter the markets in which we compete. Competitors may have different business models, have different cost structures or participate selectively in different industry segments. They may ultimately prove to be more successful or more adaptable to customer demand and new regulatory, technological and other developments. Some of our current and potential competitors may have significantly more financial, technical, marketing and other resources than we do and may be able to devote greater resources to the development, promotion, sales and support of their products and service offerings. Our competitors may also have longer operating histories, greater brand recognition and brand loyalty and broader or closer relationships with dealers, automobile manufacturers or other third-party relationships than those of our PRC subsidiaries. Additionally, a current or potential competitor may acquire, or form a strategic alliance with, one or more of our PRC subsidiaries' other competitors. Our competitors may be better at developing new products and solutions and services, responding more quickly to new technologies and undertaking more extensive and effective marketing campaigns. In response to competition, we may have to lower and/or adjust the various fees charged and paid to the other parties, such as commissions charged to purchasers for sourcing services, which could materially and adversely affect business, profit margins and results of operations. If we are unable to compete with such companies and meet the need for innovation in our industry, the demand for our services could stagnate or substantially decline, which could harm our business and results of operations.

Furthermore, we intend to enter into a market where we have limited or no prior experience. Such efforts may prove unsuccessful, and we may expend resources that yield no material gains, which could adversely impact our business and results of operations.

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***We may not be able to effectively manage our growth, control expenses or implement business strategies, any of which events may cause our PRC subsidiaries to be unable to provide services or deliver products with premium quality or compete effectively.***

We believe that our growth and expansion will depend on our ability to maintain and further develop our sourcing networks, maintain and grow our relationships with cooperating automobile manufacturers, and capture growth opportunities and implement marketing strategies and compete against existing and future competitors. There can be no assurance that we will achieve any of the above goals.

To manage our growth and expansion, and to maintain profitability, we anticipate that we will need to implement a variety of new and upgraded operational and financial systems, procedures and controls. We will also need to further expand, train, manage and motivate our workforce and manage their relationships with third parties. All of these endeavors involve risks and will require substantial management efforts and skills and significant additional expenditures. Our future growth may divert management, operational or technological resources from existing business operations. We cannot assure you that we will be able to grow and expand successfully or implement future business strategies effectively, and failure to do so may materially and adversely affect our business, financial condition, results of operations and future prospects.

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***Any harm to our brands or reputation or any damage to the reputation of the third parties with whom we collaborate or failure to enhance brand recognition could have a material adverse effect on our results of operations and growth prospects.***

Enhancing the recognition and reputation of our sourcing services and Upincar brands are critical to our business and competitiveness. Factors that are vital to this objective include, but are not limited to, our ability to:

● maintain the quality and reliability of products and services;

● maintain and develop relationships with sourcing partners;

● maintain and develop relationships with automobile manufacturers;

● provide prospective car buyers and existing car buyers with superior experience;

● effectively manage and resolve any complaints of sourcing partners, cooperating automobile manufacturers, and other third-parties; and

● effectively protect personal information and privacy of car buyers and any sensitive data received from third parties.

Any malicious or inadvertent negative allegations made by the media or other parties about the foregoing or other aspects of our company, including but not limited to our PRC subsidiaries' management, business, compliance with law, financial condition or prospects, whether with merit or not, could severely hurt our reputation and harm our business and results of operations.

In addition, as the EV market in China is under rapid development and the regulatory framework for this market is also evolving, negative publicity about this industry may arise from time to time. Negative publicity about China's EV industry, in general, may also have a negative impact on our PRC subsidiaries' reputation, regardless of whether they have engaged in any inappropriate activities. Furthermore, any negative development in the EV industry, such as alleged design deficiencies, safety concerns or negative perception of the industry as a whole, even if factually incorrect or based on isolated incidents, could compromise our PRC subsidiaries' image, undermine the trust and credibility they have established and have a negative impact on their ability to attract potential car buyers. Negative developments in the EV industry may also lead to tightened regulatory scrutiny of the sector and limit the scope of permissible business activities that may be conducted by companies such as our PRC subsidiaries. If any of the foregoing takes place, our business and results of operations could be materially and adversely affected.

Our PRC subsidiaries collaborate with various industry participants in providing products and services. Such participants include dealers, automobile manufacturers and other business partners. Negative publicity about such counterparties, such as their failure to comply with applicable laws and regulations or to otherwise meet required quality and service standards, could cause reputational harm to our business.

***For the six months ended June 30, 2025 and for the fiscal years ended December 31, 2024, 2023 and 2022, we were not profitable, and we did not generate positive cash flows from operations.***

We recorded a net loss of RMB27.4 million for the six months ended June 30, 2025. In addition, we had negative cash flows from operating activities of RMB35.9 million for the six months ended June 30, 2025. We recorded net losses of RMB56.4 million and RMB25.5 million and RMB57.7 million for the fiscal years ended December 31, 2024, 2023 and 2022, respectively. In addition, we had negative cash flows from operating activities of RMB73.2 million RMB65.4 million and RMB12.9 million for the fiscal years ended December 31, 2024, 2023 and 2022, respectively. We have made significant up-front investments in research and development, dealer networking and sales and marketing to rapidly develop and expand our business. We anticipate that we will continue to invest significantly in research and development, and sales and marketing, and potentially in production capacity expansion, to further develop and expand our business. The aforementioned investments may not result in an increase in revenue or positive cash flow on a timely basis, or at all.

We may not generate sufficient revenue or may incur substantial losses for a number of reasons, including a lack of demand for our PRC subsidiaries' products and services, increasing competition, challenging macro-economic environment, residual negative impacts on our operations due to the COVID-19 pandemic, as well as other risks discussed herein, and we may incur unforeseen expenses, or encounter difficulties, complications and delays in generating revenue or achieving profitability. If we are unable to achieve profitability, we may have to reduce the scale of our operations, which may impact our business growth and adversely affect our financial condition and results of operations. In addition, our continuous operation depends on our capability to improve operating cash flows, as well as our capacity to obtain sufficient external equity or debt financing. If we do not succeed in doing so, we may have to limit the scale of operations, which may limit our business growth and adversely affect our financial condition and results of operations.

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 ***We may be subject to potential liability in connection with pending or threatened legal proceedings and other matters, which could adversely affect our business or financial results.***

From time to time, we have been, and may in the future become, a party to various legal or administrative proceedings arising in the ordinary course of business, including breach of contract claims, anti-competition claims and other matters. Such proceedings are inherently uncertain, and their results cannot be predicted with certainty. Regardless of the outcome and merit of such proceedings, any such legal action could have an adverse impact on our business because of defense costs, negative publicity, diversion of management's attention and other factors. In addition, it is possible that an unfavorable resolution, including any judgment or settlement subjecting us to liability, of one or more legal or administrative proceedings, whether in the PRC or in another jurisdiction, could materially and adversely affect our business, financial position, results of operations or cash flows in a particular period or cause reputational damage.

In particular, we are currently subject to significant pending litigation that poses material risks to our business and financial condition. Zibo Hengsong You Car Equity Investment Fund Partnership (Limited Partnership) ("Zibo Hengsong") filed a lawsuit against Youpin SD, AHYS, WFOE, and Mr. Jia Li, seeking (i) repurchase of the 13.0435% equity interest in Youpin SD, and (ii) joint payment of the equity repurchase price of RMB240,000,000 (US$34,319,544) plus interest (temporarily calculated at RMB78,220,273 (US$11,185,350)). On December 22, 2025, the Zibo Intermediate People's Court rendered a first instance judgment ordering AHYS and Mr. Jia Li to jointly pay Zibo Hengsong equity repurchase proceeds of RMB312,374,229.66 (US$44,677,747) plus interest accruing from January 11, 2025 to the date of actual payment (calculated on the principal amount of RMB240,000,000 at an annual interest rate of 8%); ordering Youpin SD to bear joint and several liability for such payment obligations; ordering WFOE to bear joint and several liability for AHYS's payment obligations; and dismissing the defendants' counterclaim in its entirety. On January 8, 2026, Youpin SD, AHYS, Mr. Jia Li, and WFOE filed an appeal with the Shandong High People's Court, requesting that the first instance judgment be reversed and that all of Zibo Hengsong's claims be dismissed. As of the date of this prospectus, the case is under trial before the court of second instance. See also "Business — Legal Proceedings."

If the court of second instance upholds the first instance judgment, AHYS would be required to bear a total payment obligation of approximately RMB312 million or more (inclusive of continuing interest accrual). This amount would significantly exceed the net assets of AHYS and could render AHYS insolvent, which would severely and adversely impact the normal production and business operations of our domestic PRC subsidiaries and the Group as a whole, and could materially and adversely affect our business, results of operations, financial condition, cash flows and the value of our Class A Ordinary Shares.

Furthermore, the Company and its subsidiaries are involved in a number of other pending legal proceedings, including suits related to equity repurchase claims, regulatory subsidy clawbacks, and claims by third-party counterparties. For example, AHYS, Shanghai Youcang Business Consulting Partnership (Limited Partnership), and Mr. Jia Li were sued for payment of RMB10,000,000 by multiple investment fund plaintiffs, with the court of second instance upholding the first instance judgment on January 6, 2026; and the Wuhu High-Tech Industrial Development Zone Administrative Committee has issued an administrative decision requiring Youpin to return a rental subsidy of RMB3,000,000. The cumulative effect of multiple adverse judgments could further strain the Group's financial resources and liquidity.

We cannot provide any assurance that the appeal in the Zibo Hengsong case will be successful, that any of the other pending proceedings will be resolved in our favor, or that further proceedings will not be initiated against us. If any of these proceedings results in an adverse judgment, order, or settlement, our business, financial condition, results of operations, cash flows and the value of our Class A Ordinary Shares could be materially and adversely affected, potentially resulting in the bankruptcy or liquidation of the Company and its subsidiaries.

 ***Court-ordered freezes on equity interests in our PRC subsidiaries could restrict our ability to raise capital, disrupt our subsidiary operations, and materially harm our business and financial condition.***

In connection with the litigation brought by Zibo Hengsong described above, the Zibo Intermediate People's Court has issued preservation orders freezing certain equity interests held by AHYS, Mr. Jia Li, and certain related entities in several of our key PRC operating subsidiaries, including Youpin, Youpin SD, SH Youteng, SH Youxu, and CD Youyineng, as well as equity interests in certain affiliated entities. The frozen equity interests range in value from approximately RMB103,548 to RMB100,000,000 per interest, and the freezing orders remain in effect through February or March 2028. See "Business — Legal Proceedings." These measures independently pose significant and immediate risks to our business, regardless of the ultimate outcome of the underlying litigation.

Under PRC law, the holders of frozen equity interests are prohibited from selling, pledging, or otherwise transferring or disposing of those interests while the freeze remains in effect. This means that AHYS and the relevant related entities cannot freely restructure their equity holdings in the affected subsidiaries, divest non-core assets, or otherwise reorganize subsidiary-level ownership in a manner that would be responsive to changing business conditions or strategic needs. This restriction on transfers and dispositions significantly limits management's operational and strategic flexibility at a time when such flexibility may be critically needed.

The equity freeze also materially impairs the Group's access to financing. Equity interests in PRC companies are a commonly used form of collateral for secured lending in the PRC. Because the frozen equity interests cannot be pledged as collateral, the Group may be unable to obtain secured loans or other credit facilities secured by these assets. This constraint arises at a time when the Group may have heightened need for liquidity to fund operations or to satisfy any court-ordered payment obligations, and it could significantly limit the Group's financing options and overall financial flexibility.

Furthermore, if the appeal is dismissed or the first instance judgment is upheld, and the payment obligations remain unsatisfied, the court may take further enforcement actions against the frozen equity interests, including ordering their judicial auction. If third parties acquire equity interests in our key operating subsidiaries through such a process, we could lose control of those subsidiaries, which would severely disrupt ongoing business operations, undermine relationships with customers, suppliers and business partners, and materially impair our ability to operate the affected entities or the Group as a whole.

The existence of court-ordered equity freezes covering our operating subsidiaries is also likely to become known to existing and prospective customers, business partners, lenders, and government authorities. This may erode confidence in the Group's financial stability and management, impair our ability to enter into new commercial contracts or strategic partnerships, attract investment or maintain existing credit lines, and otherwise harm our reputation in the marketplace.

We cannot assure you that our appeal will be successful, that the freezing orders will be lifted, that further preservation or enforcement measures will not be imposed, or that the adverse consequences described above will not materialize. Any or all of these risks could materially and adversely affect our business, financial condition, results of operations, cash flows and the value of our securities potentially resulting in the bankruptcy or liquidation of the Company.

***We may not be able to prevent others from unauthorized use of our intellectual property, which could harm our business and competitive position.***

We regard our trademarks, service marks, patents, domain names, trade secrets, proprietary technologies and similar intellectual property as critical to our success. We rely on trademark and patent law, trade secret protection and confidentiality and license agreements with employees and others to protect such proprietary rights. We have invested significant resources to develop such own intellectual property. Failure to maintain or protect these rights could harm our business. In addition, any unauthorized use of such intellectual property by third parties may adversely affect current and future revenue and our reputation.

Implementation and enforcement of PRC intellectual property-related laws have historically been deficient and ineffective. Accordingly, protection of intellectual property rights in China may not be as effective as in the United States or other countries with more developed intellectual property laws. Furthermore, policing unauthorized use of proprietary technology is difficult and expensive. Our PRC subsidiaries rely on a combination of patent, copyright, trademark and trade secret laws and restrictions on disclosure to protect their intellectual property rights. Despite efforts to protect such proprietary rights, third parties may attempt to copy or otherwise obtain and use our PRC subsidiaries' intellectual property or seek court declarations that they do not infringe upon our PRC subsidiaries' intellectual property rights. Monitoring unauthorized use of such intellectual property is difficult and costly, and we cannot assure you that the steps we have taken or will take will prevent misappropriation of such intellectual property. From time to time, our PRC subsidiaries may have to resort to litigation to enforce their intellectual property rights, which could result in substantial costs and diversion of resources.

***Some of our patent applications on UOTTA technology are currently pending, we cannot assure you that such patents will be approved, and we may not be able to prevent others from developing or exploiting competing technologies, which could have a material and adverse effect on our business, results of operations, financial condition and prospects.***

As of the date of this prospectus, we have 51 issued patents and 18 pending patent applications in China. For our pending applications, we cannot assure you that we will be granted patents pursuant to such pending applications. Even if our patent applications succeed and we are issued patents in accordance, it is still uncertain whether these patents will be contested, circumvented or invalidated in the future. In addition, the rights granted under any issued patents may not provide us with meaningful protection or competitive advantages. The claims under any patents that issue from our patent applications may not be broad enough to prevent others from developing technologies that are similar or that achieve results similar to theirs. The intellectual property rights of others could also bar us from licensing and exploiting any patents that issue from our pending applications. Numerous patents and pending patent applications owned by others exist in the fields in which we have developed and are developing. These patents and patent applications might have priority over our patent applications and could subject our patent applications to invalidation. Finally, in addition to those who may claim priority, any of our existing or pending patents may also be challenged by others on the basis that they are otherwise invalid or unenforceable. Any of the foregoing could materially and adversely affect our business, results of operations, financial condition and prospects.

***We may need to defend against patent or trademark infringement claims, which may be time-consuming and would cause us to incur substantial costs.***

Companies, organizations or individuals, including our PRC subsidiaries' competitors, may hold or obtain patents, trademarks or other proprietary rights that would prevent, limit or interfere with our ability to make, use, develop, sell or market our products, which could make it more difficult for us to operate our business. From time to time, we may receive communications from holders of patents or trademarks regarding their proprietary rights. Companies holding patents or other intellectual property rights may bring suits alleging infringement of such rights or otherwise assert their rights and urge us to take licenses. Our applications and uses of trademarks relating to their design, software or artificial intelligence technologies could be found to infringe upon existing trademark ownership and rights. In addition, if we were to be found by a court to have infringed upon a third party's intellectual property rights, we may be required to do one or more of the following:

● cease selling, incorporating certain components into, or using or offering goods or services that incorporate or use the challenged intellectual property;

● pay substantial damages;

● seek a license from the holder of the infringed intellectual property right, which license may not be available on reasonable terms or at all;

● redesign our goods or services; or

● establish and maintain alternative branding for our products and services.

In the event of a successful claim of infringement against us and our failure or inability to obtain a license to the infringed technology or other intellectual property right, our business, prospects, operating results and financial condition could be materially and adversely affected. In addition, any litigation or claims, whether or not valid, could result in substantial costs, negative publicity and diversion of resources and management attention.

***Any significant disruption in our IT systems, including events beyond our control, or disruptions in our business partners' IT systems, could have a material and adverse effect on our business and financial condition.***

In the event of a system outage, malfunction or data loss, our ability to provide services would be materially and adversely affected. The satisfactory performance, reliability and availability of their technology and their underlying network infrastructure are critical to their operations, user service, reputation and their ability to attract new and retain existing car buyers. Our IT systems infrastructure is currently deployed and their data is currently maintained through a customized cloud computing system. Our servers are housed at third-party data centers, and their operations depend on the service providers' ability to protect their systems in their facilities as well as their own systems against damage or interruption from natural disasters, power or telecommunications failures, air quality issues, environmental conditions, computer viruses or attempts to harm their systems, criminal acts and similar events, many of which may be beyond their control. Moreover, if our arrangements with these service providers are terminated or if there is a lapse of service or damage to their facilities or if the services are no longer cost-effective to us, we could experience material interruptions to our operations.

Any interruptions or delays in our business operations, whether as a result of third-party error, our error, natural disasters or security breaches, whether accidental or willful, could harm our relationships with dealers, automobile manufacturers, and other third parties and their reputation. We may not have sufficient capacity to recover all data lost in the event of an outage, which in turn may adversely affect our results of operations and prospects.

***Misconduct and errors by our employees and the employees of third parties we collaborate with could harm our business and reputation.***

We are exposed to many types of operational risks, including the risk of misconduct and errors by our employees and the employees of third-party business partners that we collaborate with. Our business depends on our employees and third parties, such as dealers, other sourcing partners, and cooperating automobile manufacturers, to promote, manufacture, sell or deliver products. We could be materially and adversely affected if transactions are improperly executed, if confidential information was disclosed to unintended recipients or if an operational breakdown or failure in the processing of transactions occurred, whether as a result of human error, purposeful sabotage or fraudulent manipulation of operations or systems. It is not always possible to identify and deter misconduct or errors by employees or third-party business partners, and the precautions we take to detect and prevent this activity may not be effective in controlling unknown or unmanaged risks or losses. If any of their employees or employees of third-party business partners take, convert or misuse funds, documents or data or fail to follow rules and procedures when interacting with current or prospective customers, we could be liable for damages and subject to regulatory actions and penalties. We could also be perceived to have facilitated or participated in the illegal misappropriation of funds, documents or data, or the failure to follow rules and procedures, and therefore be subject to civil or criminal liability. Any of these occurrences could result in the diminished ability to operate our business, potential liability to end users, inability to attract car buyers, reputational damage, regulatory intervention and financial harm, which could negatively impact our business, financial condition and results of operations.

***We may need additional capital to pursue business objectives and respond to business opportunities, challenges or unforeseen circumstances, and financing may not be available on acceptable terms or at all.***

Since inception, we have borrowed from financial institutions to support the growth of our business. As we intend to continue to make investments to support the growth of our business, we may require additional capital to pursue our business objectives and respond to business opportunities, challenges or unforeseen circumstances, including developing new products and service offerings, increasing sales and marketing expenditures to improve brand awareness and engage car buyers through expanded channels, enhancing our PRC subsidiaries' operating infrastructure and acquiring complementary businesses and technologies. Accordingly, we may need to engage in equity or debt financing to secure additional funds. However, additional funds may not be available when needed, on terms that are acceptable, or at all. Repayment of any such debt may divert a substantial portion of cash flow to repay principal and interest on such debt, which would reduce the funds available for expenses, capital expenditures, acquisitions and other general corporate purposes; and we may suffer as a result of any default and foreclosure on assets pledged to secure any such financing, if our operating cash flow is insufficient to service debt obligations, which could in turn result in acceleration of obligations to repay the indebtedness and limit sources of financing.

Volatility in the credit markets may also have an adverse effect on our ability to obtain debt financing. If we raise additional funds through further issuance of equity or convertible debt securities, our existing shareholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our Ordinary Shares. If we are unable to obtain adequate financing or financing on terms satisfactory to us when required, our ability to continue to pursue our business objectives and to respond to business opportunities, challenges or unforeseen circumstances could be significantly limited, and our business, financial condition, results of operations and prospects could be adversely affected.

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***If we fail to implement and maintain an effective system of internal controls, we may be unable to accurately report our results of operations, meet our reporting obligations or prevent fraud, and investor confidence and the market price of our shares may be materially and adversely affected.***

We are subject to the reporting requirements of the Exchange Act of 1934, or Exchange Act, the Sarbanes-Oxley Act and the rules and regulations of the Nasdaq Stock Market. Pursuant to Section 404 of the Sarbanes-Oxley Act, we are required to file a report by our management on our internal control over financial reporting, and while we remain an "emerging growth company", as such term is defined under the JOBS Act, we will not be required to include an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. In the course of preparing our financial statements for the fiscal year ended December 31, 2024, we identified one material weakness in our internal control over financial reporting. As defined in standards established by the PCAOB, a "material weakness" is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The material weakness identified relates to our lack of sufficient skilled staff with U.S. GAAP knowledge and the SEC reporting knowledge for the purpose of financial reporting as well as the lack in formal accounting policies and procedures manual to ensure proper financial reporting in accordance with U.S. GAAP and SEC reporting requirements.

We have already taken the following steps to implement measures to remediate the material weakness we have identified: (1) streamlining our accounting department structure and enhancing our staff's U.S. GAAP expertise on a continuous basis; and (2) making an overall assessment on the current finance and accounting resources and planning to hire new finance team members with pertinent qualifications, in order to strengthen our U.S. GAAP reporting framework. We plan to take additional measures to improve the effectiveness of our internal control and financial reporting, including: (1) hiring a new reporting manager who has expertise in U.S. GAAP to improve the quality of U.S. GAAP reports; (2) participating in training and seminars provided by professional service firms on a regular basis to gain knowledge on regular accounting/SEC reporting updates; and (3) providing internal training to our current accounting team on U.S. GAAP practices. We are also in the process of completing a systematic accounting manual for U.S. GAAP and financial closing process. However, we cannot assure you that we will not identify additional material weaknesses or significant deficiencies in the future. In addition, if we are unable to meet the requirements of Section 404 of the Sarbanes-Oxley Act, our Class A Ordinary Shares may not be able to remain listed on the Nasdaq Capital Market.

If we cease to be an "emerging growth company", as such term is defined under the JOBS Act, our independent registered public accounting firm must attest to and report on the effectiveness of our internal control over financial reporting. In addition, as we are a public company, our reporting obligations may place a significant strain on our management, operational and financial resources and systems for the foreseeable future. We may be unable to timely complete our evaluation testing and any required remediation.

During the course of documenting and testing our internal control procedures, in order to satisfy the requirements of Section 404 of the Sarbanes- Oxley Act of 2002, we may identify other weaknesses and deficiencies in our internal control over financial reporting. In addition, if we fail to maintain the adequacy of our internal control over financial reporting, as these standards are modified, supplemented or amended from time to time, we may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting. 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 our 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. We may also be required to restate our financial statements from prior periods.

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***Our business will be harmed if overall consumer demand suffers from a severe or sustained economic downturn or if there is an oversupply in the automobile industry, the EV industry or the battery-swapping station sector.***

Our business is heavily dependent on consumer demand and preferences in China. Our revenue generated through our PRC subsidiaries will be materially and adversely affected if there is a severe or sustained downturn in overall levels of consumer spending in China. Retail vehicle sales are cyclical and historically have experienced periodic downturns characterized by oversupply and weak demand. These cycles are often dependent on general economic conditions, consumer confidence and governmental incentive programs, as well as the level of discretionary personal income and credit availability. In addition, consumers' demand for automobiles is also subject to other factors that are outside of our control. For example, severe or sustained increases in gasoline prices may lead to a reduction in automobile purchases or a shift in buying patterns from luxury/sports utility vehicle models, which typically provide high profit margins to retailers, to smaller, more economical vehicles, which typically have lower profit margins.

If the overall capacity of the automobile industry outgrows the demand of consumers, the oversupply of automobiles may occur, and we may face increased competition and experience increased pricing pressure. As a result, our business and profitability could be materially and adversely affected.

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***We may be subject to product liability claims if people or properties are harmed by defects in UOTTA-powered vehicles and battery-swapping stations, which may result in delays in new model launches, recall campaigns or increased warranty costs and may adversely affect our brands and result in a decrease in the residual value of such vehicles.***

We may be subject to product liability claims if people or properties are harmed by defects in UOTTA-powered EVs and battery-swapping stations. Although we may have legal recourse against the cooperating automobile manufacturers, station manufacturers and suppliers under PRC law in such circumstances, attempting to enforce our rights against these parties may be expensive, time-consuming and ultimately futile. In addition, our PRC subsidiaries do not currently maintain any third-party liability insurance or product liability insurance. As a result, any material product liability claim or litigation could have a material and adverse effect on our business, financial condition and results of operations. Even unsuccessful claims could result in the expenditure of funds and managerial efforts in defending them and could have a negative impact on our reputation. As of the date of this prospectus, we have not received any product liability claims relating to personal injury or property damage.

UOTTA-powered EVs and battery-swapping stations may contain design and manufacturing defects. The design of such vehicles and battery-swapping stations are complex and could contain latent defects and errors, which may cause vehicles not to perform or operate as expected or even result in property damage, personal injuries or death. While we and our cooperating manufacturers plan to perform extensive internal testing on UOTTA-powered EVs and battery-swapping stations, and the related software and hardware systems, we have a limited frame of reference by which to assess the long-term performance of UOTTA-powered EVs and battery-swapping stations. Any of the above may result in delays in new model launches, recall campaigns or increased warranty costs and may adversely affect our brand and growth prospects.

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***We may be subject to increased environmental and safety or other regulation resulting in higher costs, cash expenditures, and/or sales restrictions.***

As a manufacturing company manufactures battery-swapping stations, we are subject to complex environmental, manufacturing, health and safety laws and regulations at numerous jurisdictional levels in China, including laws and regulations relating to the use, handling, storage, recycling, disposal and human exposure to hazardous materials and relating to the construction, expansion and maintenance of their facilities. The costs of compliance, including remediating contamination if any is found on our facilities, and any changes to their operations mandated by new or amended laws, may be significant. We may be required to incur additional costs to comply with any changes to such regulations, and any failures to comply could result in significant expenses, delays, fines or shutdowns. We will be subject to laws, regulations and standards applicable to the supply, manufacture, import, sale and service of automobiles in different jurisdictions and relating to vehicle safety, fuel economy and emissions, among other things, in different jurisdictions which often may be materially different from each other. As a result, our PRC subsidiaries and/or their manufacturing partners may need to make additional investments to ensure regulatory compliance.

***The seasonality of the automobile industry impacts our operating results.***

The automobile industry in China is subject to seasonal variations in revenue. Demand for automobiles is generally higher before or during certain major Chinese holidays, such as the Lunar New Year in February, the Labor Day holidays in May and the National Day holidays in October. Accordingly, we expect our revenue and operating results generally to be higher in these periods than in other months of the year. Therefore, if circumstances arise during these months that impede automobile sales, such as high fuel costs, automobile supply shortage, unfavorable governmental policy changes, depressed economic conditions or similar adverse conditions, our revenue for the year would be disproportionately adversely affected. In addition, comparisons of sales and operating results between different periods within a single fiscal year, or between the same periods in different fiscal years, may not be meaningful and should not be relied upon as indicators of our performance.

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***The integration of AI technologies into our products and services is subject to significant risks and uncertainties, and there is no assurance that our AI strategy will be successful or that we will be able to effectively compete in this rapidly evolving field.***

We are in the process of integrating AI technologies into our core product and service offerings, including AI-driven solutions for energy grids, EVs, and advanced transportation systems. We do not anticipate utilizing open-source AI technology as of the date of this prospectus. While we believe that these innovations may offer operational benefits and could position us as a leading provider of comprehensive AI-integrated energy solutions, this evolving business model carries a number of risks.

The AI industry is still in its early stages and is characterized by rapid technological changes, evolving industry standards, regulatory uncertainty, and intense competition from both established companies and new market entrants. There is no guarantee that our investment in AI technologies will result in commercially viable products, competitive advantages, or customer adoption. Our AI models and algorithms may not perform as intended, may not achieve the desired efficiencies, or may produce results that are biased, unpredictable, or unreliable. Furthermore, our success depends on our ability to recruit and retain personnel with expertise in AI, data science, and advanced energy infrastructure, which is highly competitive and costly.

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***Our business depends on the continued efforts of senior management and key R&D personnel. If one or more members of our senior management or R&D teams were unable or unwilling to continue in their present positions, our business may be severely disrupted.***

Our business operations depend on the continued services of senior management, particularly the executive officers named in this prospectus and our key R&D personnel. In particular, Mr. Jia Li, our PRC subsidiaries' founder and chairman, and Mr. Zhanduo Hao, the head of our battery-swapping technology team, are critical to the management of our business and operations and the development of our strategic direction. While we have provided various incentives to sustain their continued management, and although Mr. Jia Li is also our Chief Executive Officer, there can be no assurance that we can continue to retain their services. If one or more members of senior management were unable or unwilling to continue in their present positions, we may not be able to replace them easily or at all, and we may incur additional expenses to recruit, train and retain qualified personnel. Any new executive we recruit may fail to develop or implement effective business strategies, in which case, our future growth may be constrained, our business may be severely disrupted and our financial condition and results of operations may, in turn, be materially and adversely affected.

Moreover, competition for well-qualified and skilled employees is intense. Our future success also depends on the continuing ability to attract, develop, motivate and retain highly qualified and skilled R&D personnel. In addition, although we have entered into confidentiality and non-competition agreements with our management and key R&D personnel, there is no assurance that any member of our management teams will not join competitors or form a competing business. If any dispute arises with our current or former officers, management or personnel, we may have to incur substantial costs and expenses in order to enforce such agreements in China or may be unable to enforce them at all.

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***Intense competition for employees and increases in labor costs in the PRC may adversely affect our business and results of operations.***

We believe our success depends on the efforts and talent of our employees, including sales and marketing, operations, risk management, research and development and finance personnel. Our future success depends on our continued ability to attract, develop, motivate and retain qualified and skilled employees. Competition for highly skilled sales and marketing, operations, risk management, research and development and finance personnel are extremely intense. We may not be able to hire and retain these personnel at compensation levels consistent with their existing compensation and salary structure. Some of the companies with which we compete for experienced employees have greater resources and may be able to offer more attractive terms of employment.

In addition, we invest significant time and expenses in our employees, which increases their value to competitors who may seek to recruit them. If we fail to retain our employees, we could incur significant expenses in hiring and training their replacements, and the quality of their services and ability to serve dealers and other sourcing partners, car buyers and other industry participants could diminish, resulting in a material adverse effect to our business.

The economy in China has experienced increases in inflation and labor costs in recent years. As a result, average wages in the PRC are expected to continue to increase. In addition, our PRC subsidiaries are required by PRC laws and regulations to pay various statutory employee benefits, including pension insurance, housing funds, medical insurance, work-related injury insurance, unemployment insurance and maternity insurance to designated government agencies for the benefit of their employees.

As of the date of this prospectus, we have not experienced significant inflationary pressures on labor costs negatively affecting our ongoing business. However, we expect that our labor costs, including wages and employee benefits, to continue to increase. To mitigate inflationary pressures, we plan to:

● monitor our labor costs carefully in our day-to-day operations;

● outsource or contract certain nonessential employees, to reduce labor-related administrative costs; and

● install a performance-based pay schedule for our sales personnel.

Nevertheless, there is no assurance that significant inflationary pressures on labor costs would not negatively affect our ongoing business. As a result, our business, financial condition and results of operations may be adversely affected by inflationary pressures on labor costs.

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***We may not have sufficient insurance coverage.***

Insurance companies in China currently do not offer as extensive an array of insurance products as insurance companies in more developed economies. Currently, we do not have enough business liability or disruption insurance to cover their operations. We have determined that the costs of insuring for these risks and the difficulties associated with acquiring such insurance on commercially reasonable terms make it impractical for them to have such insurance. Any uninsured business disruptions may result in the incurrence of substantial costs and the diversion of resources, which could have an adverse effect on our financial condition and results of operations.

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***We are subject to anti-corruption, anti-bribery, anti-money laundering, financial and economic sanctions and similar laws, and non-compliance with such laws can subject us to administrative, civil and criminal fines and penalties, collateral consequences, remedial measures and legal expenses, all of which could adversely affect our business, results of operations, financial condition and reputation.***

We are subject to anti-corruption, anti-bribery, anti-money laundering, financial and economic sanctions and similar laws and regulations in various jurisdictions in which we conduct activities, including the U.S. Foreign Corrupt Practices Act, or the FCPA, the Chinese Criminal Law and Anti-Unfair Competition Law, and other anti-corruption laws and regulations. The FCPA and the Chinese Criminal Law and Anti-Unfair Competition Law prohibit us and our officers, directors, employees and business partners acting on our behalf, including agents, from corruptly offering, promising, authorizing or providing anything of value to a "foreign official" for the purposes of influencing official decisions or obtaining or retaining business or otherwise obtaining favorable treatment. The FCPA also requires companies to make and keep books, records and accounts that accurately reflect transactions and dispositions of assets and to maintain a system of adequate internal accounting controls. The Chinese Criminal Law and Anti-Unfair Competition Law also prohibit non-governmental "commercial" bribery and soliciting or accepting bribes. A violation of these laws or regulations could adversely affect our business, results of operations, financial condition and reputation.

We have direct or indirect interactions with officials and employees of government agencies and state-owned affiliated entities in the ordinary course of business. We have also entered into joint ventures and/or other business partnerships with government agencies and state-owned or affiliated entities. These interactions subject us to an increased level of compliance-related concerns. We are in the process of implementing policies and procedures designed to ensure compliance by us, our PRC subsidiaries, and our directors, officers, employees, representatives, consultants, agents and business partners with applicable anti-corruption, anti-bribery, anti-money laundering, financial and economic sanctions and similar laws and regulations. However, our policies and procedures may not be sufficient and our PRC subsidiaries, our directors, officers, employees, representatives, consultants, agents, and business partners could engage in improper conduct for which we may be held responsible.

Non-compliance with anti-corruption, anti-bribery, anti-money laundering or financial and economic sanctions laws could subject us to whistleblower complaints, adverse media coverage, investigations, and severe administrative, civil and criminal sanctions, collateral consequences, remedial measures and legal expenses, any of which could materially and adversely affect our business, results of operations, financial condition and reputation. In addition, changes in economic sanctions laws in the future could adversely impact our business and investments in our shares.

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***We face risks related to natural disasters, health epidemics and outbreaks, which could significantly disrupt our operations.***

We could be adversely affected by the effects of epidemics. In recent years, there have been outbreaks of epidemics in China and globally. Our business operations could be disrupted if any of their employees are exposed to epidemics, since it could require such employees to be quarantined and/or their offices to be disinfected. In addition, our results of operations could be adversely affected to the extent that the outbreak harms the Chinese economy in general.

We are also vulnerable to natural disasters and other calamities. Although we have servers that are hosted in an offsite location, their backup system may be unable to recover certain data in the event of a server failure. We cannot assure you that any backup systems will be adequate to protect us from the effects of fire, floods, typhoons, earthquakes, power loss, telecommunications failures, break-ins, war, riots, terrorist attacks or similar events. Any of the foregoing events may give rise to interruptions, breakdowns, system failures, technology platform failures or internet failures, which could cause the loss or corruption of data or malfunctions of software or hardware.

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***Our business, financial condition and results of operations may be affected by the communicable and infectious diseases.***

For the fiscal year ended December 31, 2022, due to the impact of the COVID-19 pandemic, we had postponed some of our projects, experienced instability in the supply chain, as well as cancellations of sales orders, all of which had negatively impacted our results of operations in fiscal year 2022. On December 7, 2022, the joint prevention and control mechanism of the State Council of China issued the Notice on Further Optimizing the Implementation of Covid Prevention and Control Measures, stipulating that the control measures for epidemic prevention were gradually reduced. For the fiscal years ended December 31, 2023 and 2024 and for the six months ended June 30, 2025, as the Chinese economy experienced slow and gradual recovery from the COVID-19 pandemic, our business was not materially impacted by COVID-19.

However, the occurrence of such outbreaks in the future may disrupt our operations, and the operations of our customers and suppliers if the development of such an outbreak becomes more severe resulting in a tightening of restrictions and regulations on businesses. If we or our customers and suppliers are forced to close their businesses with prolonged disruptions to their operations, we may experience a delay or shortage of supplies and/or services by our suppliers, or termination of our orders and contracts by our customers, thereby causing our business and financial performance to be adversely affected.

**Risks Relating to Our Vehicle Sourcing Business**

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***Our vehicle sourcing network is crucial to the success of our business; if we fail to further develop or maintain our business relationships with sourcing partners at a sustainable cost, or at all, our business, financial condition and prospects would be materially and adversely affected.***

We have established a vehicle sourcing network and we believe such network allows us to access the commercial-use EV market primarily in the lower-tier cities in China.

We closely collaborate with vehicle sourcing partners in the sourcing business. As China is a large and diverse market, business practices may vary significantly by region. Experience in the markets in which our PRC subsidiaries currently operate may not be applicable in other parts of China. If we determine to expand into new geographical markets in China, such efforts may impose considerable burdens on sales, marketing and general managerial resources. If we are unable to manage such expansion efforts effectively, if expansion efforts take longer than planned, or if the costs for these efforts exceed expectations, our results of operations may be materially and adversely affected.

Our relationships with our sourcing partners are not exclusive, and there can be no assurance that we will be able to maintain our relationships with our sourcing partners. A decrease in partner participation, or deterioration in relationships with any such partners, could materially and adversely affect our business, financial condition and results of operations.

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***The commissions from our sourcing services may decline in the future, and any material decrease in such commissions could harm our business, financial condition and results of operations.***

The commissions we charge SME dealers and individual vehicle buyers could be affected by a variety of factors, including the competitive landscape of the automotive sourcing industry, regulatory requirements, and our strategic plan to expand into the EV battery-swapping market. For the fiscal years ended December 31, 2022, 2023, and 2024, the revenue from sourcing services constituted 56.8%, 7.7% and 0.1%, respectively, of our total revenue. In the six months ended June 30, 2025, the revenue from sourcing services constituted 15.9% of our total revenue.

Our competitors may offer more attractive prices and services, which may require us to reduce commissions in order to compete effectively. In addition, commissions may be sensitive to many macroeconomic factors beyond our control, such as inflation, recession, the state of the automotive market, changes in market interest rates, global economic disruptions, unemployment and fiscal and monetary policies. Furthermore, as we expand into the EV battery-swapping market, we may have limited resources available for us to use in our vehicle sourcing business. In the event that the income from the sourcing service commissions decreases significantly in the future and our PRC subsidiaries are not able to adopt any initiatives to reverse such trend, our business, financial condition and results of operations could be harmed.

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***We face intense competition in the sourcing market and may not be able to compete effectively.***

The automotive sourcing industry in China is competitive. Our competitors may offer better pricing and user experiences to prospective car buyers. We may also in the future face competition from new entrants that will increase the level of competition. More established companies, including technology companies that possess large, existing user bases, substantial financial resources and sophisticated technological capabilities may also enter the market in the future. Competitors may operate different business models, have different cost structures or participate selectively in different industry segments. They may ultimately prove to be more successful or more adaptable to customer demands and new regulatory, technological and other developments. Some of our current and potential competitors may have significantly more financial, technical, marketing and other resources than we do and may be able to devote greater resources to the development, promotion, sales and support of their platforms, products and service offerings. Competitors may also have longer operating histories, greater brand recognition and brand loyalty and broader or closer relationships with dealers, manufacturers and their authorized wholesalers, or other automotive transaction industry participants. Additionally, a current or potential competitor may acquire, or form a strategic alliance with, one or more of our other competitors. Competitors may be better at developing new products and solutions and services, offering more attractive fees, responding more quickly to new technologies and undertaking more extensive and effective marketing campaigns. In response to competition and in order to grow or maintain the cash-flow generated by the sourcing service, we may have to lower and/or adjust our fees, which could materially and adversely affect our business, profit margins and results of operations. If we are unable to compete effectively, the demand for our services could stagnate or substantially decline, which could, in turn, harm our business and results of operations.

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***Uncertainties relating to the growth of the Chinese automotive markets in general could adversely affect our sourcing business and results of operations.***

Demand for our sourcing services depends upon numerous factors affecting the development of the automotive industry in China, which may be beyond our control. These factors include, but are not limited to, the following:

● the growth in car ownership and the rate of any such growth;

● changes in car buyer demographics, tastes and preferences;

● changing financing behavior of car buyers;

● the selection, price and popularity of cars offered by manufacturers and wholesalers within our sourcing network; and

● government policies on car purchases and ownership, such as the government policy relating to subsidiaries for new energy vehicles.

***Our business is sensitive to changes in the prices of new and used vehicles.***

Significant changes in retail prices for new or used vehicles could have a material adverse effect on our sourcing business, financial condition and results of operations. For example, if retail prices for used vehicles drop significantly relative to retail prices for new vehicles, it could make buying a used vehicle more attractive to our customers than buying a new vehicle, reducing demand for our services, which could have a material adverse effect on our business, financial condition and results of operations. Additionally, manufacturer incentives could contribute to increasing the price gap between new and used vehicles. Lower used vehicle prices could reduce the orders of vehicles with our PRC subsidiaries for sale, reducing their, and consequently our, revenue.

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***We rely on third-party carriers to transport vehicles to our customers, and they are subject to associated business risks and costs and with those of the transportation industry, generally, many of which risks and costs would be out of our control.***

We rely on third-party carriers to transport vehicles to their facilities, as well as from their temporary inventory to purchasers that elect to have the vehicle delivered to them. As a result, we are exposed to risks associated with the transportation industry, such as weather, traffic patterns, local and federal regulations, vehicular crashes, gasoline prices and lack of reliability of many independent carriers. Third-party carriers who deliver vehicles to our customers could adversely affect the customer experience if they do not perform to our standards of professionalism and courtesy, which could adversely impact our business (including their reputation), financial condition and results of operations.

**Risks Relating to UOTTA-powered EV and Battery-Swapping Station Business**

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***We may encounter difficulties in entering into the EV market, which may materially and adversely affect our growth and business prospects.***

We are dedicated to (i) the development of UOTTA-powered EVs, and (ii) the development of battery-swapping stations, including the Titan station model, which is intended for electric trucks, and the Chipbox station model, which is intended for small logistic vehicles and ride-hailing vehicles. The execution of our business plan to enter the EV market is subject to significant risks and uncertainties, including, but not limited to, the following:

● our PRC subsidiaries may not be able to develop UOTTA power solutions in the desired vehicles;

● our UOTTA technology may not be effective in providing an alternative power solution to the currently more prevalent charging technology;

● our competitors may have better technology, resources, and experiences than us;

● prospective purchasers of EVs may choose not to purchase EVs with battery-swapping capabilities over conventional EVs;

● the retail market price of new EV vehicles may drop significantly and the potential sales of UOTTA-powered EVs may be subject to increased pricing pressure and sustain loss on future sales;

● our PRC subsidiaries' existing operations are in the auto sourcing business and do not have a track record in operating the new EV businesses;

● our PRC subsidiaries may not be able to accurately assess and timely respond to consumer tastes, preferences and demands; and

● our PRC subsidiaries may not be able to generate enough revenue to offset costs required in the investment of the new EV business.

These and other risks may make our business expansion plan of entering the EV market unsuccessful. In addition, implementing this plan may require significant financial, managerial and other resources be devoted to the expansion of product lines, which may divert such resources from existing business segments and product lines. If we are not successful in executing our expansion plan, our growth may be materially and adversely affected.

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***Our future growth is dependent upon the demand for, and upon consumers' willingness to adapt to, EVs and battery-swapping stations as a power solution.***

Demand for EVs depends to a large extent on general, economic, political and social conditions in a given market and the introduction of new vehicles and technologies.

Demand for EVs may also be affected by factors directly impacting automobile prices or the costs of purchasing and operating automobiles, such as sales and financing incentives, prices of raw materials and parts and components, cost of fuel and governmental regulations, including tariffs, import regulation and other taxes.

In addition, demand for EVs and battery-swapping stations will depend upon the adoption by consumers of new energy vehicles. The market for new energy vehicles is still rapidly evolving, characterized by rapidly changing technologies, competitive pricing and competitive factors, evolving government regulation and industry standards and changing consumer demands and behaviors. Other factors that may influence the adoption of EVs, include, but are not limited to, the following:

● perceptions about EV quality, safety, design, performance and cost, especially if adverse events or accidents occur that are linked to the quality or safety of EVs, whether or not such vehicles are produced by our PRC subsidiaries or other manufacturers;

● perceptions about vehicle safety, in particular safety issues that may be attributed to the use of advanced technology, including EV and regenerative braking systems;

● the limited range over which EVs may be driven on a single battery charge/swap and the speed at which batteries can be swapped;

● concerns about electric grid capacity and reliability;

● the availability of new energy vehicles, including plug-in hybrid EVs;

● improvements in the fuel economy of the internal combustion engine;

● the availability of services for EVs;

● the environmental consciousness of consumers;

● access to battery-swapping stations, standardization of commercial-use EV battery-swapping systems and consumers' perceptions about convenience and cost to swap batteries;

● the availability governmental incentives to purchase and operate EVs or future regulation requiring increased use of nonpolluting vehicles;

● perceptions about, and the actual cost of, alternative fuel; and

● macroeconomic factors.

Any of the factors described above may make it difficult for our PRC subsidiaries to promote, market or sell UOTTA-powered EVs and battery-swapping stations. If the markets for commercial-use EVs and battery-swapping stations do not grow as expected or develop more slowly than anticipated, our business, prospects, financial condition and operating results will be affected.

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***Our success depends on our ability to successfully develop, market and sell UOTTA-powered EVs and battery-swapping stations.***

The success of our UOTTA-powered EV and battery-swapping business depends in part on our ability to attract prospective EV buyers and battery-swapping station buyers and operating partners. To that end, we must continue to invest significant resources in the development of UOTTA-powered EVs, battery-swapping solutions and services and build relationships with automobile manufacturers, dealers and other third parties. Our ability to successfully develop, launch, sell and deliver UOTTA-powered EVs, battery-swapping solutions and related services depends on many factors, including our ability to anticipate and effectively respond to changing interests and preferences of car buyers, anticipate and respond to changes in the competitive landscape, and develop and offer products that address the needs of prospective buyers. If our efforts in these regards are unsuccessful, our business, prospects, financial condition and results of operations may be materially and adversely affected.

***If UOTTA-powered EVs and battery-swapping stations do not meet the expectations of customers and users, our business, financial condition and competitive position will be materially and adversely affected.***

The UOTTA-powered EVs and battery-swapping stations may not perform in line with customers' expectations. For example, UOTTA technology is a new technology and may not provide effective or reliable power solutions in practice. Furthermore, UOTTA-powered EVs and battery-swapping stations may contain defects in design and manufacturing that may cause them not to perform as expected or that may require repairs. While our PRC subsidiaries perform extensive internal testing on the vehicles and battery-swapping stations during the design and development processes, there is a limited frame of reference by which to evaluate the long-term performance of such products. There can be no assurance that we will be able to detect and fix any defects in the vehicles or battery-swapping stations prior to selling them to consumers. If any of the UOTTA-powered EVs or battery-swapping stations fail to perform as expected, deliveries may be delayed, product recalls may be initiated, and servicing or updates for products under warranty at our expense may occur, which could adversely affect our UOTTA brand in target markets and could adversely affect our business, prospects and results of operations.

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***We may encounter difficulty promoting and marketing UOTTA-powered EVs and battery-swapping stations because of the lack of unified industry standards on EV batteries.***

EV technology and battery standards vary widely among vehicle OEMs, but automakers and battery developers are reluctant to share technical standards. Currently, EVs for commercial use vary with different size and performance capabilities, and are compatible only with specific battery models. While the Ministry of Industry and Information Technology (the "MIIT") and other departments have issued policies related to battery-swapping technology for EVs, there is no clear timeline to promote the standardization of batteries.

When in operation, our battery-swapping stations will only be able to service compatible UOTTA-powered EVs, which will limit the marketability of our battery-swapping stations and UOTTA-powered EVs. The availability of compatible battery-swapping stations in the areas of their operations will affect our ability to market and sell compatible UOTTA-powered EVs, and vice versa.

Furthermore, if in the future, the MIIT publishes unified standards for EV batteries, we may incur substantial costs to conform existing and future products to such standards. If we were to fail to comply with the potential EV battery standards imposed by the MIIT, it could result in sanctions being imposed on our PRC subsidiaries, including manufacturing holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of products, operating restrictions and criminal prosecutions, any of which could significantly and adversely affect our UOTTA-powered EV and battery-swapping station business.

Any of the aforementioned developments may adversely affect our ability to commercialize UOTTA-powered EVs and battery-swapping stations, as well as our business, prospects and results of operations.

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***Our reliance on third parties for manufacturing UOTTA-powered commercial-use EVs and battery-swapping stations increases the risk that the supply of our products may become limited or interrupted or may not be of satisfactory quality and quantity.***

We lack resources for manufacturing EVs and will depend on the cooperating automobile manufacturers to manufacture UOTTA-powered EVs. Although we have our own factory for battery-swapping station manufacturing, we currently rely on third-party manufacturers for parts and components and have limited personnel with experience in battery-swapping station manufacturing. Our reliance on third-party manufacturers exposes us to the following risks:

● We may be unable to identify alternative cooperating manufacturers on acceptable terms or at all, because the number of potential cooperating manufacturers is limited. This may require new testing and regulatory interactions. In addition, any new cooperating manufacturer would have to be educated in, or develop substantially equivalent processes for, the production of our products.

● Current or any future third-party cooperating manufacturers might be unable to timely manufacture our products or produce the quantity and quality required to meet our commercial needs, if any.

● Current and any other third-party cooperating manufacturers may not be able to execute our manufacturing procedures appropriately.

● Current and any future third-party cooperating manufacturers may not perform as agreed upon or may not remain in the contract manufacturing business for the time required to supply trials or to successfully produce, store and distribute our products.

● Manufacturers are subject to inspections and regulations by the relevant PRC agencies, such as the MIIT, the National Development and Reform Commission, the State Administration for Market Regulation, National Energy Administration, and the Ministry of Transport, to ensure strict compliance with regulatory requirements and standards. Our PRC subsidiaries do not have control over third-party manufacturers' compliance with such regulations and standards.

● We may not own, or may have to share, the intellectual property rights to any additional improvements made by the third-party manufacturers in the manufacturing process for products.

● We have not entered into any exclusive cooperation agreements with third-party manufacturers, therefore the manufacturers may choose to develop and manufacture similar models with our competitors.

● Our dependence upon others for the manufacture of products may also adversely affect profit margins and our ability to commercialize any products on a timely and competitive basis.

All of the above could adversely affect our business results of operations and financial condition.

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***If we fail to comply with regulatory requirements, our business could be adversely affected.***

Development, manufacture, and sale of EVs and battery-swapping stations must comply with relevant laws and regulations. Any failure by us or our cooperating manufacturers to adhere to, or comply with, regulatory requirements could lead to a delay or interruption in the availability of our products or enforcement action from the regulatory authorities. If we or our cooperating manufacturers were to fail to comply with regulatory requirements, it could result in sanctions being imposed on us, including manufacturing holds, fines, injunctions, civil penalties, delays, suspension or withdrawal of approvals, license revocation, seizures or recalls of products, operating restrictions and criminal prosecutions; any of which could significantly and adversely affect our business and financial condition.

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***We may fail to maintain our strategic partnerships with auto manufacturers to jointly develop UOTTA-powered EVs.***

We have formed strategic partnerships and entered into cooperating agreements to jointly develop UOTTA-powered EVs with certain automobile manufactures in China. There can be no assurance that our PRC subsidiaries will be able to maintain their strategic partnerships with cooperating auto manufacturers. The cooperating agreements do not indicate exclusive collaborative relationships, and do not specify a definitive commitment as to the scale or results of their cooperation. The cooperating auto manufacturers may terminate or reduce the scale of strategic partnerships with us, or otherwise limit our ability to develop UOTTA-powered EVs or enter into the EV market. Furthermore, if we fail to perform certain contractual obligations required by these cooperation agreements, such as the obligation of providing financing solutions and support to the joint development and promotion of the UOTTA-powered EVs and power-swapping stations, there is a risk that the cooperating auto manufacturers may end their strategic partnerships or reduce the scale of their collaborations with our us. If we fail to maintain strategic partnerships with the cooperating auto manufacturers, it will adversely affect our business results of operations and our financial condition would be materially and adversely affected.

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***We depend on third parties for the supply of components and parts to manufacture battery-swapping stations.***

We depend upon third parties for the supply of certain parts and components for the manufacturing of battery-swapping stations. If such suppliers fail to provide us with products that satisfy their requirements, we may not be able to secure replacement products on favorable terms, in a timely manner, or at all. In addition, defective parts and components from these suppliers may cause personal and/or property damage to our customers, resulting in claims against us, for which indemnity from such suppliers may not be sufficient or available. We may also incur significant financial costs in connection with such claims and they may divert management's attention away from other important matters. As a result, our business, financial condition and results of operations may be negatively affected.

***We could experience cost increases or disruptions in supply of raw materials or other components used in the manufacturing of battery-swapping stations.***

We use various parts and components in the manufacturing of battery-swapping stations, including containers and charging cabinets sourced from over 15 suppliers. Our suppliers also rely on key raw materials, such as steel and aluminum to produce parts and components. The supply chain exposes them to multiple potential sources of delivery failure or component shortages. Events in upstream supplies and component shortages may negatively impact our ability to plan and deliver ordered battery-swapping stations in a timely fashion.

We do not control our suppliers, nor their business practices. Accordingly, we cannot guarantee that the quality of the components will be consistent and maintained to a high standard. Any defects of or quality deficiency issues associated with these components, or any noncompliance incidents associated with these third-party suppliers could result in quality deficiencies, which could compromise our brand image and results of operations. Additionally, we cannot guarantee the suppliers' compliance with ethical business practices, such as environmental responsibilities, fair wage practices, and compliance with child labor laws, among others. A lack of demonstrated compliance with any such requirements could lead us to seek alternative suppliers, which could increase costs and result in delayed delivery of products, product shortages, or other disruptions of operations.

Furthermore, qualifying alternate suppliers for certain customized components of battery-swapping stations may be time-consuming and costly. Any disruption in the supply of components could temporarily disrupt production of vehicles until an alternative supplier is fully qualified by them or is otherwise able to supply them with the required material. We cannot assure you that in such circumstances we would be able to successfully retain alternative suppliers or supplies on a timely basis, on acceptable terms, or at all. Changes in business conditions, force majeure, government changes, or other factors beyond our control or anticipation, could also affect our PRC subsidiaries' suppliers' ability to deliver components to them on a timely basis. Moreover, if we experience a significant increase in demand or need to replace existing suppliers, there can be no assurance that additional supplies will be available when required on terms that are favorable to them, or at all, or that any supplier would allocate sufficient supplies to them in order to meet their requirements or fill our orders in a timely manner. Any of the foregoing could materially and adversely affect our business, financial condition, results of operations, and prospects.

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***Adverse conditions affecting one or more of our cooperating automobile manufacturers, battery-swapping station manufacturers and suppliers may negatively impact our business, financial condition and prospects.***

Success of our business depends to a great extent on the reputation, as well as marketing and production capabilities of cooperating automobile manufacturers and battery-swapping station manufacturers, and suppliers with whom we collaborate. Adverse conditions affecting these and other important aspects of these manufacturers' operations may adversely affect our PRC subsidiaries' ability to develop and market the UOTTA-powered EVs and battery-swapping stations, and result in material adverse impact upon our business, financial condition, results of operations and prospects.

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***We have experienced, and may continue to experience, delays in the development and launch of UOTTA-powered EV models in collaboration with our cooperating manufacturers.***

As of the date of this prospectus, we have entered into cooperating agreements to jointly develop UOTTA-powered EVs with two major automobile manufacturers by adapting selected EV models with our UOTTA technology. We have experienced, and may continue to experience, delays in the development and commercial release of UOTTA-powered EV models, due to various reasons, such as delays in resolving design issues and obtaining the required governmental approvals. Furthermore, we rely on third-party suppliers for the provision and development of certain key components to be used in the UOTTA-powered EVs. To the extent we need to further delay the launch of the UOTTA-powered EVs, our growth prospects could be materially and adversely affected, as we may lose the targeted markets to competitors and miss the opportunity to enter into the EV market as we had planned.

***The UOTTA-powered EVs we jointly develop with cooperating automobile manufacturers are subject to motor vehicle safety standards and the failure to satisfy such mandated safety standards would have a material adverse effect on our business and operating results.***

All vehicles must comply with various safety standards of the market where the vehicles are sold. In China, vehicles must meet or exceed all mandated safety standards. Rigorous testing prior to the launch of vehicles and auto parts and the use of approved materials and equipment are among the requirements for achieving such standards. Vehicles must pass various tests and undergo a certification process and be affixed with the China Compulsory Certification ("CCC"), before receiving delivery from the factory, being sold, or being used in any commercial activity, and such certification is also subject to periodic renewal. The process of obtaining the CCC typically requires four to five months. Furthermore, the government carries out the supervision and scheduled and unscheduled inspection of certified vehicles on a regular basis. In the event that a certified vehicle has a defect resulting in quality or safety accidents, or consistently fails to comply with certification requirements during follow-up inspections, the CCC may be suspended or even revoked. Any vehicle that fails to satisfy the requirements for the CCC may not continue to be delivered, sold, imported or used in any commercial activities. If we fail to ensure that each of the UOTTA-powered car models satisfy the safety standards, our business, prospects and financial conditions will be adversely affected.

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***The construction and operation of our battery-swapping station manufacturing facilities are subject to regulatory approvals or filings and may be subject to changes, delays, cost overruns or may not produce expected benefits.***

Under PRC law, construction projects are subject to broad and strict government supervision and approval procedures, including but not limited to project approvals and filings, construction land and project planning approvals, environment protection approvals, pollution discharge permits, work safety approvals, fire protection approvals, and the completion of inspection and acceptance by relevant authorities. Some of the construction projects being carried out by us are undergoing necessary approval procedures as required by law. As a result, the relevant entities operating such construction projects may be subject to administrative uncertainty, and construction projects in question may be subject to fines or the suspension of use of such projects. Failure to complete the construction projects on schedule and within budget, and failure to obtain necessary approvals or any incompliance with relevant government supervision could have a material adverse impact on our PRC subsidiaries' operations, and we may not be able to find commercially reasonable alternatives.

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***The unavailability, reduction or elimination of government and economic incentives or government policies which are favorable for EVs, domestically produced vehicles or battery-swapping stations could have a material adverse effect on our business, financial condition and prospects.***

Our growth depends significantly on the availability and amounts of government subsidies, economic incentives and government policies that support the expansion of the new energy vehicle industries. Favorable government incentives and subsidies vary by geographic region in China, and may include one-time government subsidies, exemption from vehicle purchase tax, exemption from license plate restrictions in certain cities, preferential utility rates for charging facilities and more. Changes in government subsidies, economic incentives and government policies to support EVs could adversely affect our results of operations.

China's central government provides subsidies for purchasers of certain EVs and reviews and further adjusts the subsidy standards on an annual basis. According to *Notice on the Fiscal Subsidy Policy for the Promotion and Application of New Energy Vehicles in 2022(Cai Jian [2021] No.466),* in 2022, the subsidy standard by the Chinese central government for new energy vehicles was lowered by 30% from the level of 2021; with the exception that the subsidy standard for vehicles used for urban public transportation, road passenger transport, taxis (including taxis subject to online booking), environmental sanitation, urban logistics and distribution, postal and express delivery, civil aviation airports and official duties of the Chinese Communist Party and government organs was lowered by 20% from the level of 2021. The new energy vehicle purchase subsidies were terminated on December 31, 2022, and no subsidies will be granted to vehicles licensed after December 31, 2022. On January 30, 2023, the Ministry of Industry and Information Technology, the Ministry of Transport, together with the Development and Reform Commission, the Ministry of Finance, the Ministry of Ecology and Environment, the Ministry of Housing and Urban-Rural Development, the Energy Bureau, and the Post Office launched the pilot work of the public domain vehicle comprehensive electrification pilot area nationwide, with a pilot period of 2023-2025 (the "2023 New Energy Vehicle Subsidy Policy"). The main goal is to significantly increase the level of vehicle electrification. The proportion of new energy vehicles in new and updated vehicles in pilot areas has increased significantly, among which, urban public transportation, leasing, sanitation, postal express delivery, and urban logistics distribution areas strive to reach 80%. Further, in order to promote the development of local new energy vehicles, 23 cities have recently announced the 2023 New Energy Vehicle Subsidy Policy. As a result, the future sales of the UOTTA-powered vehicles might be negatively affected.

Our business may also be impacted by government policies such as tariffs on imported cars and foreign investment restrictions in the industry. The tariff in China on imported passenger vehicles (other than those originating in the United States of America) was reduced to 15% starting from July 1, 2018. As a result, pricing advantage of domestically manufactured vehicles could be diminished. There used to be certain limit on foreign ownership of automakers in China, but for automakers of EVs, such limit was lifted in 2018. Further, pursuant to the currently effectively Special Administrative Measures for Market Access of Foreign Investment (2021 Version), or the 2021 Negative List, which came into effect on January 1, 2021, the limit on foreign ownership of automakers for ICE passenger vehicles was lifted. As a result, foreign EV competitors can build wholly owned facilities in China without the need for a domestic joint venture partner. The above changes may affect the competitive landscape of the EV industry and reduce any pricing advantage we had enjoyed, which may adversely affect our business, results of operations and financial condition.

China's central government encourages local governments to provide funds and subsidies to support the roll-out of EV charging infrastructures. On October 20, 2020, the General Office of the State Council issued the Notice on Development Plan of New Energy Vehicles Industry (2021-2035). Pursuant to such notice, the new energy vehicles industry in China has entered a new stage for accelerated development, in which the state plans to promote the construction of charging and swapping networks, encourage the application of the power exchange mode, strengthen the research and development of new charging technologies, and improve charging convenience and product reliability.

These policies are subject to change and beyond our control. Furthermore, any reduction, elimination, delayed payment or discriminatory application of government subsidies and economic incentives because of policy changes, the reduced need for such subsidies and incentives due to the perceived success of EVs, fiscal tightening or other factors may result in the diminished competitiveness of the new energy vehicle industry generally, or UOTTA-powered EVs, in particular. Any of the foregoing could materially and adversely affect our business, results of operations, financial condition and prospects.

**Risks Relating to Our Capital Structure**

 

***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 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.

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***Our dual class share structure with different voting rights will limit your ability to influence corporate matters and could discourage others from pursuing any change of control transactions that holders of our Class A Ordinary Shares may view as beneficial.***

We have adopted a dual class share structure such that our Ordinary Shares consist of Class A Ordinary Shares and Class B Ordinary Shares. In respect of matters requiring the votes of shareholders, each Class A Ordinary Share is entitled to one (1) vote and each Class B Ordinary Share is entitled to one hundred (100) votes. Each Class B Ordinary Share is convertible into one Class A Ordinary share at any time by the holder thereof. Our Class A Ordinary Shares are not convertible into our Class B Ordinary Shares under any circumstances.

Only our Class A Ordinary Shares are tradable on the market. This voting structure may discourage investors from pursuing any change of control transactions that holders of our Class A Ordinary Shares may view as beneficial.

**Risks Relating to this Offering, Our Class A Ordinary Shares and the Trading Market**

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***An active trading market for our Class A Ordinary Shares may not develop or sustain, and the trading price for our Class A Ordinary Shares may fluctuate significantly.***

No assurance can be given that an active market in our Class A Ordinary Shares will develop or be sustained. If an active market does not develop, the market price and liquidity of our Class A Ordinary Shares may be materially and adversely affected, and holders of our Class A Ordinary Shares may be unable to readily sell the shares they hold or may not be able to sell their shares at all. There can be no guarantee that we will continue to satisfy the continued listing standards of Nasdaq. If we fail to satisfy the continued listing standards, we could be de-listed, which would have a negative effect on the price of our Class A Ordinary Shares and impair your ability to sell your shares. As a result, investors in our securities may experience a significant decrease in the value of their Class A Ordinary Shares.

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***The trading price of our Class A Ordinary Shares has been, and is likely to continue to be, volatile, which could result in substantial losses to investors.***

The trading price of our Class A Ordinary Shares has been, and is likely to continue to be, volatile and could fluctuate widely due to various factors, some of which are beyond our control. This may happen because of broad market and industry factors, like 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. A number of Chinese companies have listed or are in the process of listing their securities on U.S. stock markets. The securities of some of these companies have experienced significant volatility, including price declines in connection with their initial public offerings. The trading performances of these Chinese companies' securities after their offerings may affect the attitudes of investors toward Chinese companies listed in the United States in general and consequently may impact the trading performance of our Class A Ordinary Shares, regardless of our actual operating performance.

In addition to market and industry factors, the price and trading volume for our Class A Ordinary Shares may be highly volatile for factors specific to our own operations, including the following:

● variations in our income, earnings and cash flow;

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

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

● changes in financial estimates by securities analysts;

● detrimental adverse publicity about us, our services or our industry;

● additions or departures of key personnel;

● release of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; and

● potential litigation or regulatory investigations.

Any of these factors may result in large and sudden changes in the volume and price at which our Class A 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.

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***Geopolitical conflicts involving Iran, military actions in the Middle East, and the war in Ukraine may adversely affect global economic conditions and cause significant volatility in the trading price of our Class A Ordinary Shares.***

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The heightened military conflict involving the United States, Israel, and Iran, which escalated significantly in February 2026, has led to profound instability in global financial and energy markets. These events, including the closure of strategic airspaces and critical maritime routes such as the Strait of Hormuz and the Red Sea, have contributed to a dramatic increase in the price of oil and gas and created widespread market uncertainty. The ongoing disruptions caused by these military actions, and the potential for further escalation, could result in protracted and severe damage to the global economy and investment climate.

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Furthermore, the continuing war in Ukraine and the resulting sanctions levied by the United States, the European Union, and other nations against Russia continue to impact global financial markets. The extent and duration of these military actions in the Middle East and Eastern Europe, as well as the resulting sanctions and market disruptions, are impossible to predict but are expected to remain substantial.

Such geopolitical instability often leads to broad sell-offs in the equity markets and heightened investor sensitivity to risk. Consequently, these developments may materially and adversely affect the market price of our Class A Ordinary Shares, regardless of our actual operating performance. We cannot predict the ultimate progress or outcome of these situations, and any prolonged unrest or intensified military activities could have a material adverse effect on the global economy, which in turn could negatively impact our financial condition and the value of our securities.

***We may experience extreme stock price volatility unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Class A Ordinary Shares.***

There have been recent instances of extreme stock price run-ups followed by rapid price declines and strong stock price volatility with a number of recent initial public offerings, especially among companies with relatively smaller public floats. As a relatively small-capitalization company with relatively small public float, we may experience greater share price volatility, extreme price run-ups, lower trading volume and less liquidity than large-capitalization companies. In particular, our Class A Ordinary Shares may be subject to rapid and substantial price volatility, low volumes of trade and large spreads in bid and ask prices. Such volatility, including any share run-up, may be unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Class A Ordinary Shares. In addition, investors of our Class A Ordinary Shares may experience losses, which may be material, if the price of our Class A Ordinary Shares declines or if such investors purchase Class A Ordinary Shares prior to any price decline.

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***If securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations regarding our Class A Ordinary Shares, the market price for our Class A Ordinary Shares and trading volume could decline.***

The trading market for our Class A 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 our Class A Ordinary Shares, the market price for our Class A 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 our Class A Ordinary Shares to decline.

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

Sales of substantial amounts of our Class A Ordinary Shares in the public market, or the perception that these sales could occur, could adversely affect the market price of our Class A Ordinary Shares and could materially impair our ability to raise capital through equity offerings in the future. The Class A Ordinary Shares sold in the initial public offering and the follow-on offering are freely tradable without restriction or further registration under the Securities Act of 1933, as amended, or the Securities Act, and shares held by our existing 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. 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 our Class A Ordinary Shares.

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***Because we do not expect to pay dividends in the foreseeable future, you must rely on price appreciation of our Class A Ordinary Shares for return on your investment.***

We currently intend to retain most, if not all, of our available funds and any future earnings to fund the development and growth of our business. As a result, we do not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on an investment in our Class A Ordinary Shares as a source for any future dividend income.

Our board of directors has complete discretion as to whether to distribute dividends. 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, among other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our subsidiary, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors. In addition, our shareholders may declare dividends by ordinary resolution, but no dividend shall exceed the amount recommended by our board of directors. Accordingly, the return on your investment in our Class A Ordinary Shares will likely depend entirely upon any future price appreciation of our Class A Ordinary Shares. There is no guarantee that our Class A Ordinary Shares will appreciate in value or even maintain the price at which you purchased the Class A Ordinary Shares. You may not realize a return on your investment in our Class A Ordinary Shares and you may even lose your entire investment in our Class A Ordinary Shares.

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***Our memorandum and articles of association contain anti-takeover provisions that could have a material adverse effect on the rights of holders of our Class A Ordinary Shares.***

Our memorandum and articles of association contain provisions to limit the ability of others to acquire control of our company or cause us to engage in change-of-control transactions. These provisions could have the effect of depriving our shareholders of an opportunity to sell their shares at a premium over prevailing market prices by discouraging third parties from seeking to obtain control of our company in a tender offer or similar transaction. Our board of directors has the authority, without further action by our shareholders, to issue preferred shares in one or more series and to fix their designations, powers, preferences, privileges, and relative participating, optional or special rights and the qualifications, limitations or restrictions, including dividend rights, conversion rights, voting rights, terms of redemption and liquidation preferences, any or all of which may be greater than the rights associated with our Class A Ordinary Shares. Preferred shares could be issued quickly with terms calculated to delay or prevent a change in control of our company or make removal of management more difficult. If our board of directors decides to issue preferred shares, the price of our Class A Ordinary Shares may fall and the voting and other rights of the holders of our Class A Ordinary Shares may be materially and adversely affected.

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

We are an exempted company incorporated under the laws of the Cayman Islands. Our corporate affairs are governed by our memorandum and articles of association, the Companies Act (as Revised) of the Cayman Islands and the common law of the Cayman Islands. The rights of shareholders to take action against the directors, actions by minority shareholders, and the fiduciary responsibilities 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, 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 responsibilities of our directors under Cayman Islands law are not as clearly established as 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.

Shareholders of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records or to obtain copies of lists of shareholders of such companies (save for our memorandum and articles of association, our register of mortgages and charges and special resolutions of our shareholders). Our directors have discretion under our articles of association to determine whether, 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 differ significantly from requirements for companies incorporated in other jurisdictions such as the U.S. To the extent we choose to follow home country practice, shareholders may be afforded less protection than they otherwise would have 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 management, members of the board of directors or controlling shareholders than they would as public shareholders of a company incorporated in the United States.

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***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 Nasdaq corporate governance listing standards; these practices may afford less protection to shareholders than they would enjoy if we complied fully with Nasdaq corporate governance listing standards***.

As a Cayman Islands company listed on the Nasdaq, we are subject to Nasdaq corporate governance listing standards. However, the 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 Nasdaq corporate governance listing standards. A Cayman Islands company is not required to have annual general meetings. Shareholders of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records or to obtain copies of lists of shareholders of these companies. Our directors have discretion under our articles of association to determine whether, 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. To the extent we choose to follow home country practice with respect to corporate governance matters, our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers.

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

As a public company, we will incur significant legal, accounting and other expenses that we did not incur as a private company. The Sarbanes-Oxley Act of 2002, as well as rules subsequently implemented by the SEC and the Nasdaq, impose various requirements on the corporate governance practices of public companies. We expect these rules and regulations to increase our legal and financial compliance costs and to make some corporate activities more time-consuming and costlier. For example, we expect that operating as a public company will make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. In addition, we will incur additional costs associated with our public company reporting requirements. It may also be more difficult for us to find qualified persons to serve on our board of directors or as executive officers. We are currently evaluating and monitoring developments with respect to these rules and regulations, and we cannot predict or estimate with any degree of certainty the amount of additional costs we may incur or the timing of such costs.

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

Because we are 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 of quarterly reports on Form 10-Q or current reports on Form 8-K with the SEC;

● 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.

We will be required to file an annual report on Form 20-F within four months of the end of each fiscal year. In addition, we intend to publish our results through press releases, distributed pursuant to the rules and regulations of the Nasdaq. Press releases relating to financial results and material events will also be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely than that required to be filed with the SEC by U.S. domestic issuers. 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.

***As a result of the price resets and subsequent share adjustments in the Warrants and/or if the Warrants are exercised by way of a zero cash exercise, shareholders are likely to suffer substantial dilution and see a significant decrease in the value of their Class A Ordinary Shares.***

  ****

The Warrants include exercise price reset provisions and a zero cash exercise option, both of which will result in the issuance of a significantly higher number of shares upon exercise. Specifically, the Warrants will be immediately exercisable and may be exercisable until the one (1) year anniversary of the date of issuance at an assumed initial exercise price equal to $0.66. In addition, subject to certain conditions, the exercise price for the Warrants will be adjusted downward on each of the 2<sup>nd</sup> and 5<sup>th</sup> trading day following the closing of this offering to the price that is equal to 70% and 50%, respectively, of the initial exercise price, and the number of Class A Ordinary Shares underlying the Warrants will be proportionally increased, as further described herein. The Warrants also contain certain mechanisms for cashless exercise, including a zero cash exercise option pursuant to which holders of the Warrants have the option, upon exercise and for no additional cash consideration, to receive an aggregate number of Class A Ordinary Shares equal to the product of (x) the aggregate number of Class A Ordinary Shares that would be issuable upon a cash exercise of the Warrant and (y) 2.0.

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As an example, for each Unit that an investor purchases in this offering at the assumed offering price of $0.66 per Unit, the investor will receive one Class A Ordinary Share and one Warrant to purchase one Class A Ordinary Share at an assumed exercise price of $0.66 per Class A Ordinary Share. Giving effect solely to the adjustment on the first Reset Date and not giving effect to the zero cash exercise option, on the first Reset Date, each Warrant will become exercisable for a maximum of 1.43 Class A Ordinary Shares at an exercise price of $0.462 per Class A Ordinary Share. If such Warrant is then exercised at such time based on the zero cash exercise option, the Warrant would be exercisable into 2.86 Class A Ordinary Shares. If the Warrant remains outstanding as of the second Reset Date, giving effect solely to the potential adjustment on the second Reset Date and not giving effect to the zero cash exercise option, on the second Reset Date, each Warrant will become exercisable for a maximum of two Class A Ordinary Shares at an exercise price of $0.33 per Class A Ordinary Share. If such Warrant is then exercised at such time based on the zero cash exercise option, the Warrant would be exercisable into four Class A Ordinary Shares. Accordingly, if all of the Warrants offered to investors in this offering are exercised on a zero cash basis, a maximum of 36,363,636 Class A Ordinary Shares could be issued upon such zero cash exercise, without payment to the Company of any additional cash. In addition, we have granted the Representative an option exercisable within 45 days of the date of this prospectus to purchase from us up to 1,363,636 additional Class A Ordinary Shares and/or up to 1,363,636 Warrants to cover over-allotments, if any. If the Representative's over-allotment option for Warrants is exercised in full to purchase 1,363,636 Warrants and all such Warrants are exercised on a zero cash basis, a maximum of 5,454,544 Class A Ordinary Shares could be issued upon such zero cash exercise without payment to the Company of any additional cash. If all of the Warrants offered to investors in this offering, including those subject to the Representative's over-allotment option for Warrants, are exercised on a zero cash basis, a maximum of 41,818,180 Class A Ordinary Shares could be issued upon such zero cash exercise without payment to the Company of any additional cash.

As a result of the terms of the Warrants, it is likely that our stock price will be reduced considerably because of each of the resets. Accordingly, shareholders are likely to suffer substantial dilution and see a significant decrease in the value of their Class A Ordinary Shares as a result of this transaction.

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***There is no public market for the Pre-funded Warrants or Warrants in this offering.***

 **

There is no established public trading market for the Pre-funded Warrants or Warrants, and we do not expect a market to develop. In addition, we do not intend to apply for listing of the Pre-funded Warrants or Warrants on any securities exchange or recognized trading system. Without an active market, the liquidity of the Warrants and Pre-funded Warrants will be limited.

***Since we have broad discretion in how we use the proceeds from this offering, we may use the proceeds in ways with which you disagree.***

Our management will have significant flexibility in applying the net proceeds of this offering. You will be relying on the judgment of our management with regard to the use of these net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. It is possible that the net proceeds will be invested in a way that does not yield a favorable, or any, return for us. The failure of our management to use such funds effectively could have a material adverse effect on our business, prospects, financial condition, operating results and cash flow.

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***Nasdaq may halt trading in our Class A Ordinary Shares on Nasdaq or delist our Class A Ordinary Shares for public interest concerns as a result of this offering.***

 **

Because of the highly dilutive nature of this offering, Nasdaq may halt trading in our Class A Ordinary Shares on Nasdaq or delist our Class A Ordinary Shares for public interest concerns, or if we fail to comply with Nasdaq's minimum bid price requirement because our Class A Ordinary Shares trade below Nasdaq's minimum bid price as a result of this offering, even if we are otherwise able to regain compliance for continued listing on Nasdaq. A number of Nasdaq-listed companies have filed public disclosures regarding the receipt of notification letters indicating that Nasdaq made the determination to halt and/or delist such companies as a result of public interest concerns arising from the issuance of warrants with similar terms to, and similar potential dilutive impact as, the Warrants in this offering. Additionally, warrants with similar terms issued by other Nasdaq-listed companies have caused such Nasdaq-listed companies' stock prices to drop below Nasdaq's minimum bid price or made it more difficult for these companies to cause their stock prices to regain compliance with Nasdaq's minimum bid price. Therefore, even if we consummate this offering at a price above Nasdaq's minimum bid price, there can be no assurance that our Class A Ordinary Shares will not drop below such price, which may cause Nasdaq to delist our Class A Ordinary Shares.

If Nasdaq delists our securities from trading on its exchange for failure to meet its listing standards, and we are not able to list such securities on another national securities exchange, then our Class A Ordinary Shares could be quoted on an over-the-counter market. If this were to occur, we and our shareholders could face significant material adverse consequences, including:

● a limited availability of market quotations for our securities;

● reduced liquidity for our securities;

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

● a limited amount of news and analyst coverage; and

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

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***We will likely not receive any additional funds upon the exercise of the Warrants.***

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The Warrants may be exercised by way of a zero cash exercise, in which case the holder would not pay a cash purchase price upon exercise, but instead would receive upon such exercise the number of Class A Ordinary Shares equal to the product of (x) the aggregate number of Class A Ordinary Shares that would be issuable upon a cash exercise of the Warrant and (y) 2.0. Accordingly, it is highly unlikely that a holder of the Warrants would wish to pay an exercise price in cash to receive one Class A Ordinary Share when they could instead choose the zero cash exercise option and pay no cash to receive up to four Class A Ordinary Shares following the second Reset Date. As a result, we will likely not receive any additional funds and do not expect to receive any additional funds upon the exercise of the Warrants.

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***The public offering price in this offering will be set by our Board and does not necessarily indicate the actual or market value of our Class A Ordinary Shares.***

Our Board, or a committee designated by the Board, will approve the public offering price and other terms of this offering after considering, among other things: the current market price of our Class A Ordinary Shares; trading prices of our Class A Ordinary Shares over time; the volatility of our Class A Ordinary Shares; our current financial condition and the prospects for our future cash flows; the availability of and likely cost of capital of other potential sources of capital; and the characteristics of interested investors and market and economic conditions at the time of the offering. The public offering price is not intended to bear any relationship to the book value of our assets or our past operations, cash flows, losses, financial condition, net worth, or any other established criteria used to value securities. The public offering price may not be indicative of the fair value of our Class A Ordinary Shares.

***Nasdaq may apply additional and more stringent criteria for our continued listing, since our insiders hold a large portion of our listed securities.***

Nasdaq Listing Rule 5101 provides Nasdaq with broad discretionary authority over the initial and continued listing of securities on Nasdaq and Nasdaq may use such discretion to deny initial listing, apply additional or more stringent criteria for the initial or continued listing of particular securities, or suspend or delist particular securities based on any event, condition, or circumstance that exists or occurs that makes initial or continued listing of the securities on Nasdaq inadvisable or unwarranted in the opinion of Nasdaq, even though the securities meet all enumerated criteria for initial or continued listing on Nasdaq. In addition, Nasdaq has used its discretion to deny initial or continued listing or to apply additional and more stringent criteria in the instances, including: (i) where the company engaged an auditor that has not been subject to an inspection by the PCAOB, an auditor that PCAOB cannot inspect, or an auditor that has not demonstrated sufficient resources, geographic reach, or experience to adequately perform the company's audit; (ii) where the company planned a small public offering, which would result in insiders holding a large portion of the company's listed securities (in which instance, Nasdaq was concerned that the offering size was insufficient to establish the company's initial valuation, and there would not be sufficient liquidity to support a public market for the company); and (iii) where the company did not demonstrate sufficient nexus to the U.S. capital market, including having no U.S. shareholders, operations, or members of the board of directors or management. Since our insiders hold a large portion of our listed securities, Nasdaq may apply additional and more stringent criteria for our continued listing. If we fail to satisfy Nasdaq's enhanced listing requirements, or even if we satisfy such requirements but Nasdaq nevertheless determines that the continued listing of our securities is inadvisable or unwarranted, Nasdaq may delist our Class A Ordinary Shares. Any such delisting could materially and adversely affect the trading market for our Class A Ordinary Shares and could cause their value to decline significantly or become worthless.

***Nasdaq has proposed a new $5 million minimum market value continued listing requirement that, if approved, could result in immediate suspension and delisting of our Class A Ordinary Shares without any cure period or opportunity to regain compliance.***

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On January 13, 2026, Nasdaq proposed new listing rules requiring companies on the Nasdaq Global and Capital Markets to maintain a minimum market value of listed securities of at least $5 million. Under this proposal, if our market value falls below $5 million for 30 consecutive business days, our Class A Ordinary Shares would be immediately suspended from trading and delisted from Nasdaq, with no cure period, no compliance period, and no stay of suspension during any appeal.

This proposed rule represents a fundamental departure from Nasdaq's traditional approach to listing deficiencies. Unlike other continued listing requirements that provide companies with 180 days or more to regain compliance, the proposed market value requirement would result in immediate and irreversible consequences. While we could request a hearing before a Nasdaq Listing Qualifications Hearings Panel to appeal a delisting determination, such a request would not prevent the immediate suspension of our Class A Ordinary Shares from trading. Furthermore, the panel would have extremely limited discretion and could only reverse the delisting decision if it determines that the initial determination was in error, and the panel could not consider evidence that we had subsequently regained compliance or grant us additional time to do so.

Nasdaq's proposal reflects its belief that once a company's market value falls below $5 million, the challenges facing that company are generally not temporary and are so severe that the company is unlikely to regain and sustain compliance for the long term. Nasdaq further believes it is difficult to maintain fair and orderly markets for such low-value companies. The SEC must decide on the proposal within 45 days of publication in the Federal Register, unless it extends the review period, creating uncertainty regarding whether and when this rule may become effective.

Our market value is calculated as our consolidated closing bid price multiplied by our total listed securities. Factors that could cause our market value to fall below the proposed threshold include continued stock price decline, lack of investor interest, adverse market conditions, negative developments in our business operations, dilutive financing transactions, or broader market volatility affecting microcap companies.

This proposal is part of a broader trend of Nasdaq tightening listing standards for smaller issuers, including recent rules granting Nasdaq discretion to deny initial listings based on susceptibility to manipulative trading and other market value-based requirements. This increasingly stringent regulatory environment creates greater challenges for microcap companies such as us to maintain public listings.

If the proposed $5 million market value continued listing requirement is approved and we subsequently fail to maintain the required market value for 30 consecutive business days, our Class A Ordinary Shares would be immediately suspended from trading and delisted from Nasdaq without any opportunity to cure the deficiency. Such suspension and delisting would have severe adverse consequences for our business, our ability to raise capital, and the liquidity and value of our shareholders' investments. Moreover, even if we remain in compliance with quantitative criteria, Nasdaq retains discretionary authority under Rule IM-5101-1 to suspend or terminate a company's listing if necessary to protect investors or ensure the orderly operation of the market, which could result in similar adverse consequences even absent a failure to meet specific quantitative thresholds.

Because we are a small company, the requirements of being a public company, including compliance with the reporting requirements of the Exchange Act and certain requirements of the Sarbanes-Oxley Act of 2022 (the "Sarbanes-Oxley Act") and the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), may strain our resources, increase our costs and distract management, and we may be unable to comply with these requirements in a timely or cost-effective manner.

As a public company with listed equity securities, we must comply with the federal securities laws, rules, and regulations, including certain corporate governance provisions of the Sarbanes-Oxley Act and the Dodd-Frank Act, related rules and regulations of the SEC and the Nasdaq, with which a private company is not required to comply. Complying with these laws, rules and regulations occupies a significant amount of the time of our board of directors and management and significantly increases our costs and expenses. Among other things, we must:

● maintain a system of internal control over financial reporting in compliance with the requirements of Section 404 of the Sarbanes-Oxley Act and the related rules and regulations of the SEC;

● comply with rules and regulations promulgated by the Nasdaq;

● prepare and distribute periodic public reports in compliance with our obligations under the federal securities laws;

● maintain various internal compliance and disclosures policies, such as those relating to disclosure controls and procedures and insider trading in our Class A Ordinary Shares; and

● involve and retain to a greater degree outside counsel and accountants in the above activities.

**FORWARD-LOOKING STATEMENTS**

This prospectus contains forward-looking statements that reflect our current expectations and views of future events, all of which are subject to risks and uncertainties. You can identify these statements by the fact that they do not relate strictly to historical or current facts. You can find many (but not all) of these statements by the use of words such as "approximates," "believes," "hopes," "expects," "anticipates," "estimates," "projects," "intends," "plans," "will," "would," "should," "could," "may," or other similar expressions in this prospectus. These statements are likely to address our growth strategy, financial results, and product and development programs. You must carefully consider any such statements and should understand that many factors could cause actual results to differ from our forward-looking statements. These factors may include inaccurate assumptions and a broad variety of other risks and uncertainties, including some that are known and some that are not. No forward-looking statement can be guaranteed and actual future results may vary materially. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to:

● assumptions about our future financial and operating results, including revenue, income, expenditures, cash balances, and other financial items;

● our ability to execute our growth, and expansion, including our ability to meet our goals;

● current and future economic and political conditions;

● our capital requirements and our ability to raise any additional financing which we may require;

● our ability to attract clients and further enhance our brand recognition;

● our ability to hire and retain qualified management personnel and key employees in order to enable us to develop our business; and

● other assumptions described in this prospectus underlying or relating to any forward-looking statements.

We describe certain material risks, uncertainties, and assumptions that could affect our business, including our financial condition and results of operations, under "Risk Factors" and elsewhere in this prospectus. We base our forward-looking statements on our management's beliefs and assumptions based on information available to our management at the time the statements are made. We caution you that actual outcomes and results may, and are likely to, differ materially from what is expressed, implied or forecast by our forward-looking statements. Accordingly, you should be careful about relying on any forward-looking statements. Except as required under the federal securities laws, we do not have any intention or obligation to update publicly any forward-looking statements after the distribution of this prospectus, whether as a result of new information, future events, changes in assumptions, or otherwise.

**Industry Data and Forecasts**

This prospectus contains market data and industry forecasts and projections, which were obtained or derived from publicly available information, reports of governmental agencies, market research reports, and industry publications and surveys. These sources generally state that the information contained therein has been obtained from sources believed to be reliable, but that the accuracy and completeness of that information is not guaranteed. Although we believe such information to be accurate, we have not independently verified the data from these sources. However, we acknowledge our responsibility for all disclosures in this prospectus. Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and additional uncertainties and risks regarding the other forward-looking statements in this prospectus due to a variety of factors, including those described in this section, the section entitled "Risk Factors" and elsewhere in this prospectus. These and other factors could cause results to differ materially from those expressed in the forecasts and estimates.

**USE OF PROCEEDS** 

We estimate that the net proceeds from this offering will be approximately $5.23 million (assuming the sale of all Units offered), after deducting underwriting discounts and commissions and estimated offering expenses payable by us, and assuming no exercise of the Warrants (for which we do not expect to receive any proceeds in any case), based on an assumed public offering price of $0.66 per Unit. If the over-allotment option is exercised in full, we estimate that our net proceeds will be approximately $6.06 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by us.

We will only receive additional proceeds from the exercise of the Warrants issuable in connection with this offering if such Warrants are exercised for cash. The Warrants may be exercised by way of a cashless exercise or a zero cash price exercise; meaning that the holder thereof may not pay a cash purchase price upon exercise, but instead would receive upon such exercise a number of Class A Ordinary Shares for every Warrant they exercise in accordance with the formula contained in the Warrants. Accordingly, we will likely not receive any additional funds upon the exercise of the Warrants.

We intend to use the net proceeds of this offering as follows:(i) US$2,517,000 will be applied to repay the outstanding principal balance due on the 2025 Senior Secured Promissory Notes, together with an 18% per annum late charge (which accrued as of their maturity on March 1, 2026), which notes are non-interest bearing; and (ii) will be used for working capital and other general corporate purposes.

The foregoing represents our current intentions with respect to the use of the net proceeds of this offering based upon our present plans and business conditions, but our management will have significant flexibility and discretion in applying the net proceeds. The occurrence of unforeseen events or changed business conditions could result in the application of the net proceeds of this offering in a manner other than as described above.

We will incur all costs associated with this prospectus and the registration statement of which it is a part.

Each $0.10 increase (decrease) in the assumed public offering price of $0.66 per Unit would increase (decrease) the net proceeds to us from this offering, after deducting the underwriting discounts and estimated offering expenses payable by us, by approximately $845,454, assuming that the number of Units offered by us, as set forth on the cover page of this prospectus, remains the same. We may also increase or decrease the number of Units we are offering. An increase (decrease) of 100,000 in the number of Units we are offering would increase (decrease) the net proceeds to us from this offering, after deducting the underwriting discounts and estimated offering expenses payable by us, by approximately $61,380, assuming the public offering price stays the same. An increase of 100,000 in the number of Units we are offering, together with a $0.10 increase in the public offering price of $0.66 per Unit, would increase the net proceeds to us from this offering, after deducting the underwriting discounts and estimated offering expenses payable by us, by approximately $916,134. A decrease of 100,000 in the number of Units we are offering, together with a $0.10 decrease in the public offering price of $0.66 per Unit, would decrease the net proceeds to us from this offering, after deducting the underwriting discounts and estimated offering expenses payable by us, by approximately $916,134. We do not expect that a change in the offering price or the number of Units by these amounts would have a material effect on our intended uses of the net proceeds from this offering, although it may impact the amount of time prior to which we may need to seek additional capital.

**CAPITALIZATION**

The following table sets forth our capitalization and indebtedness as of June 30, 2025:

● on an actual basis;

● on a pro forma as-adjusted basis to give effect to the issuance and sale of 9,090,909 Units offered hereby, based on an assumed offering price of $0.66 per Unit, each Unit consisting of (i) one Class A Ordinary Share (or one Pre-funded Warrant); and (ii) one Warrant, assuming no exercise of the Warrants included in the Units, no issuance of Pre-funded Warrants and no other change to the number of Units sold by us as set forth on the front cover of this prospectus; and (iii) the application of the net proceeds after deducting underwriting discounts, expense allowance, and estimated offering expenses payable by us, and assuming no Pre-funded Warrants are sold in this offering, no exercise of the over-allotment option, and no exercise of the Warrants.

You should read this table in conjunction with our consolidated financial statements and the related notes appearing elsewhere in this prospectus, and other financial information included elsewhere in this prospectus.

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| |
|:---|
| **Cash, cash equivalents and restricted cash** |
| **Debt** |
| Short term borrowings |
| Shareholders' Equity: |
| Class A Ordinary Shares, $0.00001 par value, 3,999,411,812 Class A Ordinary Shares authorized, 4,603,440 and 13,694,349 Class A Ordinary Shares issued and outstanding - actual and pro forma as adjusted basis, respectively |
| Class B Ordinary Shares, $0.00001 par value, 1,000,588,188 Class B Ordinary Shares authorized, 368,544 Class B Ordinary Shares issued and outstanding - actual and pro forma as adjusted basis |
| Additional paid-in capital |
| Accumulated deficit |
| **Total equity attributable to U Power Limited** |
| Equity attributable to non-controlling interests |
| Total equity |
| **Total Capitalization** |

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The pro forma as-adjusted information discussed above is illustrative only. Our additional paid-in capital, total shareholders' equity, and total capitalization following the completion of this offering are subject to adjustment based on the actual public offering price and other terms of this offering determined at pricing.

**DIVIDEND POLICY**

Our board of directors has complete discretion as to whether to distribute dividends. In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our board of directors. In either case, all dividends are subject to certain restrictions under Cayman Islands law, namely that we may only pay dividends out of profits or share premium, and provided that in no circumstances may a dividend be paid if it 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 pay dividends, the form, frequency, and amount will depend upon our future operations and earnings, capital requirements and surplus, general financial condition, contractual restrictions and other factors that our board of directors may deem relevant.

We do not have any plan to declare or pay any cash dividends on our Class A Ordinary Shares in the foreseeable future. We intend to retain most, if not all, of our available funds and future earnings to operate and expand our business.

We are an exempted company with limited liability incorporated in the Cayman Islands. We rely principally on dividends distributed by our PRC subsidiaries and payments from PRC subsidiaries for our cash requirements, including distribution of dividends to our shareholders. Dividends distributed by our PRC subsidiaries are subject to PRC taxes.

In addition, PRC regulations may restrict the ability of our PRC subsidiaries to pay dividends to us and only allow a PRC company to pay dividends out of its accumulated distributable after-tax profits as determined in accordance with its articles of association and the PRC accounting standards and regulations. See "Risk Factors — Risks Relating to Doing Business in China" of this prospectus.

**DILUTION**

If you invest in the securities being offered in this offering, assuming no issuance of any Pre-funded Warrants and no exercise of any Warrants, and no exercise of the over-allotment option, your ownership interest will be diluted to the extent of the difference between the public offering price per Class A Ordinary Share included in the Units and our pro forma as-adjusted net tangible book value per Ordinary Share immediately after this offering. Dilution results from the fact that the public offering price per Class A Ordinary Share included in Units is substantially in excess of the pro forma as-adjusted net tangible book value per Ordinary Share attributable to the existing shareholders for our presently outstanding Ordinary Shares.

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 is entitled to one vote per Class A Ordinary Share and each holder of Class B Ordinary Shares is entitled to 100 votes per 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. The Class B Ordinary Shares are not being converted as part of this offering.

Our net tangible book value as of June 30, 2025, was $40,589,267 or $9.18 per Class A Ordinary Share. Net tangible book value is the amount of our total consolidated tangible assets, less the amount of our total consolidated liabilities. Dilution is determined by subtracting the net tangible book value per Ordinary Share (as adjusted for the offering) from the public offering price per Class A Ordinary Share and after deducting the underwriting discounts and the estimated offering expenses payable by us.

After giving effect to the issuance and sale of 9,090,909 Units offered in this offering based on an assumed public offering price of $0.66 per Unit, after deduction of the underwriting discounts and the estimated offering expenses payable by us, and assuming no issuance of Pre-funded Warrants, no exercise of the Warrants included in the Units, and no exercise of the over-allotment option, our pro forma as-adjusted net tangible book value as of June 30, 2025, would have been approximately $45,816,102, or $3.30 per outstanding Class A Ordinary Share. This represents an immediate decrease in net tangible book value of $5.88 per Class A Ordinary Share to the existing shareholders, and an immediate accretion in net tangible book value of $2.64 per Class A Ordinary Share to investors purchasing Units in this offering.

The dilution information discussed above is illustrative only and may change based on the actual public offering price and other terms of this offering.

The following table illustrates such dilution:

---

| | |
|:---|:---|
|  Assumed public offering price per Unit | $0.66 |
|  Net tangible book value per Ordinary Share as of June 30, 2025 | $9.18 |
|  Decrease in pro forma as-adjusted net tangible book value per Ordinary Share attributable to payments by new investors | $5.88 |
|  Pro Forma as-adjusted net tangible book value per Ordinary Share immediately after this offering | $3.3 |
|  Amount of accretion in net tangible book value per Ordinary Share to new investors in the offering | $2.64 |

---

Notes:

(1) Based upon 4,603,440 Class A Ordinary Shares and 368,044 Class
B Ordinary Shares outstanding as of the date of this prospectus, which excludes (i) any Class A Ordinary Shares underlying the Warrants
as of the date of this prospectus; (ii) an aggregate of 551,628 Class A Ordinary Shares issuable upon the exercise of outstanding warrants
issued pursuant to the July 2025 SPA; (iii) an aggregate of 1,562,502 Class A Ordinary Shares issuable upon the exercise of outstanding
warrants issued pursuant to January 2025 SPA; and (iv) an aggregate of 50,000 Class A Ordinary Shares issuable upon the exercise of outstanding
warrants issued pursuant to the December 2023 SPA.

(2) The information above
 reflects and assumes (i) no sale of Pre-funded Warrants in this offering, which, if sold, would reduce the number of Class A
 Ordinary Shares that we are offering on a one-for-one basis, and (ii) no exercise of the Warrants issued in this offering (including
 up to 41,818,180 Class A Ordinary Shares issuable upon a "zero cash exercise" of the Warrants) or any Warrant resets
 that may take place. Also, the information above does not include proceeds from the exercise of the over-allotment option granted.

A $0.10 increase (decrease) in the assumed public offering price of $0.66 per Unit would increase (decrease) our pro forma as-adjusted net tangible book value as of June 30, 2025 after this offering, given the same assumptions described above, by approximately $845,454, or $0.06 per Class A Ordinary Share, and would increase (decrease) dilution to new investors by approximately $0.04 per Class A Ordinary Share, assuming that the number of Units offered by us, as set forth on the cover page of this prospectus, remains the same, and after deducting the underwriting discounts and offering expenses payable by us.

We may also increase or decrease the number of Units we are offering. An increase (decrease) of 100,000 in the number of Units we are offering would increase (decrease) our pro forma as-adjusted net tangible book value as of June 30, 2025, giving effect to this offering, by approximately $61,380, or approximately $0.02 per Class A Ordinary Share, and would decrease dilution (increase) to investors in this offering by approximately $0.02 per Class A Ordinary Share, given the same assumptions described above.

Each 100,000 Unit increase (decrease) in the number of Units offered by us together with a concomitant $0.10 increase (decrease) in the public offering price of $0.66 per Unit would increase (decrease) the pro forma as-adjusted net tangible book value by $0.04 per Class A Ordinary Share and the dilution to new investors by $0.06 per Class A Ordinary Share, given the same assumptions described above.

The pro forma as-adjusted information as discussed above is illustrative only. Our net tangible book value following the completion of this offering is subject to adjustment based on the actual public offering price of our Units and other terms of this offering determined at the pricing.

The following table summarizes, on a pro forma as-adjusted basis as of June 30, 2025, the differences between the number of Ordinary Shares purchased from us given the assumptions described above, the total cash consideration and the average price per Ordinary Share paid to us by existing shareholders and by new investors purchasing Units in this offering at the public offering price of $0.66 per Unit, before deducting estimated underwriting discounts and estimated offering expenses payable by us:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Ordinary Shares<br> Purchased** | **Ordinary Shares<br> Purchased** | **Total<br> Consideration** | **Total<br> Consideration** | |
|  | **Number** | **Percent** | **Amount** | **Percent** | **Average Price<br> Per Ordinary**<br>**Share** |
| Existing shareholders | 4419856 | 32.71% | $42278320 | 87.57% | $9.57 |
| New public investors | 9090909 | 67.29% | 6000000 | 12.43% | $0.66 |
| Total | 13510765 | 100% | 48278320 | 100% | $3.57 |

---

To the extent that warrants, options or other securities are issued, including under our equity incentive plans, or should we issue additional Class A Ordinary Shares in the future, there will be further dilution to the persons being issued Class A Ordinary Shares in this offering. In addition, we may choose to raise additional capital because of market conditions or strategic considerations, even if we believe that we have sufficient funds for our current or future operating plans. If we raise additional capital through the sale of equity or convertible debt securities, the issuance of such securities could result in further dilution to our shareholders.

**CORPORATE HISTORY AND STRUCTURE**

Our subsidiary, AHYS, a limited liability company established pursuant to PRC laws on May 16, 2013, operates through the following subsidiaries:

(1) Youpin, which was established on July 18, 2013 and AHYS holds 54.37% of its equity interest. Youpin has the following subsidiaries:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Liaoning Youguan New Energy Technology Co., Ltd. ("LY New Energy"), which was established on November 8, 2019, and is wholly owned by Youpin.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Shanghai Youchuangneng Digital Technology Co., Ltd. ("SY Digital Tech"), which was established on November 13, 2015, and is wholly owned by Youpin.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. Youguan Financial Leasing (China) Co., Ltd., which was established on February 27, 2017 and is wholly owned by Youpin;

(2) CD Youyineng, which was established on October 29, 2020 and is wholly owned by AHYS;

(3) SH Youteng, which was established on November 3, 2020 and AHYS holds 70% of its equity interest;

(4) SH Youxu, which was established on March 22, 2021 and AHYS holds 70% of its equity interest. SH Youxu has the following subsidiaries:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Quanzhou Youyi Power Exchange Network Technology Co., Ltd., which was established on June 29, 2021 and is wholly owned by SH Youxu;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Youxu (Xiamen) Power Exchange Network Technology Co., Ltd., which was established on August 10, 2021 and is wholly owned by SH Youxu;

c.Wuhu Youxu New Energy Technology Co., Ltd., which was established on November 12, 2021 and is wholly owned by SH Youxu;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Henan Youxu New Energy Technology Co., Ltd., which was established on December 1, 2022 and SH Youxu owns 80% of its equity interest;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e. Youxu New Energy Technology (Nanyang) Co., Ltd., which was established on March 14, 2023 and SH Youxu owns 70% of its equity interest; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f. Youxu New Energy Technology (Jilin) Co., Ltd., which was established on January 22, 2026 and SH Youxu owns 70% of its equity interest.

(5) Youpin SD, which was established on June 30, 2020 and AHYS holds 86.96% of its equity interest. Youpin SD has the following subsidiaries:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Youxu New Energy Technology (Zibo) Co., Ltd., which was established on July 29, 2021 and Youpin SD owns 98.0392% of its equity interest.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. Zibo Hengxin Investment Partnership Enterprise (Limited Partnership), which was established on November 2, 2020 and Youpin SD owns 99.0099% of its equity interest.

(5) U SWAP Co., Ltd., which was established on June 13, 2024 and AHYS owns 85% of its equity interest. U SWAP Co., Ltd has the following subsidiary:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Greendrive Tech Co., Ltd., which was established on March 5, 2025, is owned 70% by U SWAP Co., Ltd. and 30% by Ezzy Transporter (Thailand) Company Limited.

Since 2013, AHYS and its subsidiaries have principally engaged in the provision of vehicle sourcing services. Beginning in 2020, AHYS and its subsidiaries gradually shifted focus from the vehicle sourcing business to the development of their proprietary battery-swapping technology, or UOTTA technology.

**Reorganization in Connection with Our IPO**

In connection with our initial public offering (the "IPO"), which was closed in April 2023, we undertook a reorganization (the "Reorganization") in the following steps:

On June 17, 2021, Upincar was incorporated under the laws of the Cayman Islands. Upincar owns 100% of Youcang Limited, a British Virgin Islands company incorporated on June 30, 2021. Youcang Limited owns 100% of Energy U Limited, a Hong Kong company incorporated on July 19, 2021.

On January 27, 2022, WFOE was incorporated pursuant to the PRC laws as a wholly foreign owned enterprise. Energy U Limited holds 100% of the equity interest in WFOE. On July 8, 2022, WFOE acquired 99% equity interest in AHYS for RMB217,774,286.31. On December 12, 2022, WFOE acquired the remaining 1% equity interest in AHYS from U Robur Limited (HK), a Hong Kong company.

**Our Corporate Structure**

We are a Cayman Islands exempted company incorporated on June 17, 2021. Exempted companies are Cayman Island companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act (As Revised) of the Cayman Islands.

The following diagram illustrates our corporate structure as of the date of this prospectus.

![](ea028160401_img2.jpg)

(1) On December 16, 2024, Energy U Limited, entered into a joint venture agreement with UNEX-UNEXMOB MOBILIDADE ELÉTRICA, LDA and Associação Nacional dos Transportes Rodoviários em Automóveis Ligeiros to establish a joint venture in Portugal. Upon the formation of the joint venture, Energy U Limited will hold a 25% equity interest in the joint venture, Associação Nacional dos Transportes Rodoviários em Automóveis Ligeiros will hold a 50% equity interest, and UNEX-UNEXMOB Mobilidade Elétrica, LDA will hold the remaining 25% equity interest. As of the date of this prospectus, the joint venture has not been formally established, as its registration and related incorporation procedures are still ongoing.

(2) On December 25, 2024, U SWAP Co., Ltd., signed a cooperation agreement with Ezzy Transporter (Thailand) Company Limited to establish Greendrive Tech Co., Ltd. in Thailand. Upon the formation of the joint venture, U Swap Co Ltd. holds a 70% equity interest in Greendrive Tech Co., Ltd. and Ezzy Transporter (Thailand) Company Limited holds the remaining 30% equity interest. On March 5, 2025, Greendrive Tech Co., Ltd. was incorporated in Thailand.

**MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION** 

**AND RESULTS OF OPERATIONS**

*The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and the notes thereto, included herein. Those financial statements have been prepared in accordance with U.S. GAAP and, among other things, include more detailed information regarding the basis of presentation for the following information.*

 

**Operating Results**

Since our commencement of operations in 2013, we have principally engaged in the provision of vehicle sourcing services in China. In addition to our vehicle sourcing service, we aspire to becoming an EV market player primarily focused on UOTTA technology, which is an intelligent modular battery-swapping technology designed to provide a comprehensive battery power solution for EVs. As a vehicle sourcing service provider, we broker sales of vehicles between automobile wholesalers and buyers, including SME dealers and individual customers primarily located in the lower-tier cities in China. To that end, we have focused on building business relationships with our sourcing partners and have developed a vehicle sourcing network. As of the date of this prospectus, our vehicle sourcing network consisted of approximately 100 wholesalers and 30 SME dealers located in lower-tier cities in China.

Beginning in 2020, we gradually shifted our focus from the vehicle sourcing business to the development of our proprietary battery-swapping technology, or UOTTA technology. Through our research and development efforts, we have developed an intellectual property portfolio centered on our UOTTA technology. Our plan is to develop a comprehensive EV battery power solution based on UOTTA technology, including: (i) UOTTA-powered EVs, which we jointly develop with two major automobile manufacturers in China by adapting selected EV models with our UOTTA technology; (ii) UOTTA battery-swapping stations, which are compatible with our UOTTA-powered EVs; and (iii) a UOTTA data management platform which collects and synchronizes real-time information that connects UOTTA-powered EVs with UOTTA battery-swapping stations.

For the six months ended June 30, 2025 and for the fiscal years ended December 31, 2022, 2023 and 2024, our total revenue was RMB17.8 million, RMB7.8 million, RMB19.8 million and RMB44.3 million, respectively. The decreased revenue in 2022 was primarily because we could not secure enough sales of battery-swapping stations in the new market regions because of insufficient business development in those regions in 2022, while most of the sales in established market regions had been completed in 2021. Meanwhile, the COVID-19 resurgence and lockdown measures in the fiscal year of 2022 in China slowed down the construction and installation of our battery-swapping stations. The increased revenue in the fiscal years ended December 31, 2023 and 2024 was primarily due to the increased sales of battery-swapping stations which had been completed in our established market regions in fiscal year 2023. The increased revenue for the six months ended June 30, 2025 was primarily due to the Group's performance in overseas markets during the period, particularly in Thailand.

**Key Factors Affecting Our Results of Operations**

Our results of operations have been, and are expected to continue to be, affected by various factors, which primarily include the following:

 ****

***General market******conditions***

General market conditions affecting our operations include:

● China's macroeconomic conditions, the growth of China's overall auto market, the commercial EV market and the government policy on promoting the electrification of commercial vehicles;

● penetration rate of EVs and battery-swapping stations in China's commercial EV market;

● development, and customer acceptance and demand, of UOTTA-powered EVs and battery-swapping stations; and

● government policies and regulations on the EV and battery-swapping station industries in China.

***Our cooperation with auto manufacturers***

 ****

As of the date of this prospectus, our UOTTA technology is in the process of being adapted to commercial-use electric vehicles, by cooperating with major auto manufacturers in China. We have entered into cooperating agreements with two car manufacturers to jointly develop the UOTTA-powered EV models. We expect that the expertise and industry know-how of such manufacturers will guide us in our efforts in entering the commercial EV market. We believe that we are able to develop such relationships with these major manufacturers, due to our industry experience, research and development capabilities, and industry reputation.

 **

***Our ability to attract new customers and grow our customer base***

 **

Our ability to attract and retain customers is critical to the continued success and growth of our business. Appropriate pricing is essential for us to remain competitive in the China automotive market, while preserving our ability to achieve and maintain profitability in the future. Our ability to attract new customers also depends on the scale and efficiency of our sales network and marketing channels. We seek to attract new customers cost-efficiently by engaging in various marketing activities. Enhanced customer satisfaction will help to drive word-of-mouth referrals, which we expect may reduce our customer acquisition costs.

 ****

***Our ability to deliver our UOTTA-powered EV and battery-swapping stations portfolio***

Our ability to deliver UOTTA-powered EV models and battery-swapping stations, and to provide battery-swapping services will be an important contributor to our future growth. As of the date of this prospectus, we are jointly developing our UOTTA-powered EV models with car manufacturers and have launched two models of UOTTA battery-swapping stations, Titan and Chipbox, by cooperating with one battery-swapping station manufacturer in China. We expect our revenue growth to be driven in part by the launch of our UOTTA-powered EV and expansion of our battery-swapping stations portfolio.

 **

***Our ability to innovate and retain talents***

 **

We plan to focus on technological innovations and to continue developing and upgrading our proprietary UOTTA technology. Accordingly, we dedicate significant resources to research and development, and our research and development staff accounted for 32% of our total employees as of the date of this prospectus. We expect our strategic focus on innovations to further differentiate us from our competitors, which may in turn enhance our competitiveness.

**Key Financial Performance Indicators**

 ****

***Revenue***

The following table sets forth a breakdown of our revenue, in absolute amounts and percentages of total revenue for the six months ended June 30, 2025 and for the fiscal years ended December 31, 2022, 2023, and 2024, respectively:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2024** | **2025** | **2025** | **2025** |
|  | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| Sourcing services | 75 | 0.6 | 2812 | 393 | 15.9 |
| Product sales | 12389 | 93.9 | 13899 | 1940 | 78.4 |
| Battery-swapping services | 726 | 5.5 | 1018 | 142 | 5.7 |
| **Total revenues** | **13190** | **100.0** | **17729** | **2475** | **100.0** |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** |
|  | **2022** | **2022** | **2023** | **2023** | **2024** | **2024** | **2024** |
|  | **RMB** | **%** | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
| Sourcing services | 4428 | 56.8 | 1513 | 7.7 | 63 | 9 | 0.1 |
| Product sales | 3061 | 39.3 | 17062 | 86.3 | 41819 | 5729 | 94.5 |
| Battery-swapping services | 307 | 3.9 | 1189 | 6.0 | 1177 | 161 | 2.7 |
| Two-wheeled vehicle battery-swapping services | - | - | - | - | 1231 | 169 | 2.7 |
| **Total revenue** | **7796** | **100.0** | **19764** | **100.0** | **44290** | **6068** | **100.0** |

---

We generate revenue from vehicle sourcing services, products sales of battery-swapping stations, battery-swapping services and two-wheeled vehicle battery-swapping services. Battery-swapping services revenue represents the revenue generated from providing battery-swapping services for vehicle drivers, and station control system upgrading services for battery-swapping station owners.

 

*Sourcing services*

For vehicle sourcing business, we charge our customers for the service we provide in connection with their purchases of vehicles, where we are generally acting as an agent, and our performance obligation is to purchase the specified vehicles for our customers. We charge the customers a commission that is calculated based on the purchase price of each purchase order. Vehicle sourcing service fee revenue is recognized on a net basis at the point in time when the service of purchase of the specified vehicles for our customers is completed, i.e., the specified vehicle for our customers is delivered. Payments are typically received in advance and are accounted for as contract liabilities until delivery, at which point the receipt in advance from customers is offset with the prepayment to the supplier and the difference representing the commission is recognized as revenue.

 

*Product Sales*

We generate revenue from sales of battery-swapping stations. We identify the users who purchase battery-swapping stations as our customers. The revenue for battery-swapping station sales is recognized at a point in time when the control of the product is transferred to our customers.

 

*Battery-swapping services*

We generate revenue from providing battery-swapping services for vehicle drivers and station control system upgrading services for battery-swapping station owners.

***Cost of Revenue***

The following table sets forth a breakdown of our cost of revenue, both in absolute amounts and percentages of the total cost of our revenue, for the six months ended June 30, 2025 and for the fiscal years ended December 31, 2022, 2023, and 2024, respectively:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2024** | **2025** | **2025** | **2025** |
|  | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| Costs of sourcing services |  |  | 2514 | 351 | 26.9 |
| Costs of product sales | 11313 | 95.1 | 6116 | 854 | 65.5 |
| Costs of battery-swapping services | 566 | 4.8 | 692 | 96 | 7.4 |
| Other costs | 23 | 0.1 | 16 | 3 | 0.2 |
| **Total cost of revenue** | **11902** | **100.0** | **9338** | **1304** | **100.0** |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** |
|  | **2022** | **2022** | **2023** | **2023** | **2024** | **2024** | **2024** |
|  | **RMB** | **%** | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
| Costs of sourcing services | 2029 | 39.5 | 22 | 0.3 | 62 | 8 | 0.2 |
| Costs of product sales | 2257 | 43.9 | 6124 | 80.6 | 31229 | 4279 | 92.3 |
| Costs of battery-swapping services | 793 | 15.4 | 1348 | 17.8 | 1721 | 236 | 5.1 |
| Cost of two-wheeled vehicle battery-swapping services |  |  |  |  | 584 | 80 | 1.7 |
| Other costs | 58 | 1.2 | 98 | 1.3 | 231 | 31 | 0.7 |
| **Total cost of revenue** | **5137** | **100.0** | **7592** | **100.0** | **33827** | **4634** | **100.0** |

---

Costs of products sales mainly include the costs of sales of batter-swapping stations, which primarily include semi-finished goods purchased from suppliers, labor costs and manufacturing costs, mainly including depreciation of assets associated with production.

Costs of battery-swapping services mainly include the electric charge costs and the rental costs of batteries for battery-swapping services.

Other service costs primarily include the taxes and surcharges costs in accordance with PRC laws.

 ****

***Operating Expenses***

The following table sets forth a breakdown of our operating expenses, both in absolute amounts and percentages of operating expenses, for the six months ended June 30, 2025 and for the fiscal years ended December 31, 2022, 2023, and 2024, respectively:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2024** | **2025** | **2025** | **2025** |
|  | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| Sales and marketing expense | 1483 | 5.4 | 1767 | 247 | 6.8 |
| General and administrative expenses | 26157 | 94.5 | 24571 | 3430 | 95.0 |
| Research and development expenses | 575 | 2.1 | 3416 | 477 | 13.2 |
| Expected credit losses | (531) | (2.0) | (3903) | (545) | (15.1) |
| **Total operating expenses** | **27684** | **100.0** | **25851** | **3609** | **100.0** |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** |
|  | **2022** | **2022** | **2023** | **2023** | **2024** | **2024** | **2024** |
|  | **RMB** | **%** | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
| Sales and marketing expense | 2041 | 3.5 | 2477 | 5.0 | 2789 | 382 | 4.1 |
| General and administrative expenses | 37714 | 64.0 | 41222 | 84.0 | 46910 | 6427 | 68.5 |
| Research and development expenses | 9352 | 15.9 | 2184 | 4.5 | 2985 | 409 | 4.4 |
| Loss on impairment of long-lived assets and long-term investment |  |  | 1996 | 4.1 | 10504 | 1439 | 15.3 |
| Allowance for expected credit loss do | 9801 | 16.6 | 1196 | 2.4 | 5264 | 721 | 7.7 |
| **Total operating expenses** | **58908** | **100.0** | **49075** | **100.0** | **68452** | **9378** | **100.0** |

---

*General and administrative expenses*

Our general and administrative expenses primarily consist of (i) employee compensation, including salaries, benefits and bonuses for our general corporate staff; (ii) professional service fees; (iii) depreciation for office equipment; (iv) operating and lease expenses for our offices; (v) office utilities; and (vi) certain other expenses.

Our selling, general and administrative expenses are mainly driven by the number of our sales, general corporate personnel, marketing and promotion activities and the expansion of our sales and service network.

*Research and development expenses*

Our research and development expenses consist primarily of personnel-related costs directly associated with research and development. Our research and development expenses are related to enhancing and developing UOTTA technology for our existing products and new product development. We expense research and development costs as incurred.

Our research and development expenses are mainly driven by the number of our research and development personnel, as well as the stage and scale of our UOTTA-powered EVs and battery-swapping stations development.

 

*Allowance for expected credit loss*

 

Our allowance for expected credit loss primarily consists of the provision of expected credit losses for accounts receivable, advances to suppliers and other current assets, recorded after management estimates that the collection for the full amount is no longer probable.

 

*Taxation*

<u>Cayman Islands</u>

We are incorporated in the Cayman Islands. 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 the 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 the shares, nor will gains derived from the disposal of the shares be subject to Cayman Islands income or corporation tax.

<u>British Virgin Islands</u>

Our subsidiaries incorporated in the British Virgin Islands are not subject to tax on income or capital gains under the current laws of the British Virgin Islands. There are currently no withholding taxes in the BVI applicable to these subsidiaries.

<u>Hong Kong</u>

Our subsidiaries incorporated in Hong Kong, are subject to a two-tiered income tax rate for their taxable income earned in Hong Kong. The first HK$2 million of profits earned by a company is subject to be taxed at an income tax rate of 8.25%, while the remaining profits will continue to be taxed at the existing tax rate of 16.5%. No provision for Hong Kong profits tax has been made in the consolidated financial statements as it has no assessable profit for the six months ended June 30, 2025 and for the fiscal years ended December 31, 2022, 2023, and 2024, respectively.

<u>PRC</u>

Our subsidiaries in the PRC are subject to Enterprise Income Tax ("EIT") on their taxable income in accordance with the relevant EIT law ("EIT Law"). Pursuant to the EIT Law, which became effective on March 16, 2007 and was amended on December 29, 2018, a uniform 25% enterprise income tax rate is generally applicable to both foreign-invested enterprises, or FIEs and domestic enterprises, except where a special preferential rate applies. The EIT is calculated based on the entity's global income as determined under PRC tax laws and accounting standards.

Under the EIT Law, dividends generated after January 1, 2008 and payable by an foreign-invested enterprise ("FIE") in the PRC to its foreign investors who are non-resident enterprises are subject to a 10% withholding tax, unless any such foreign investor's jurisdiction of incorporation has a tax treaty with the PRC that provides for a different withholding arrangement. The Cayman Islands, where the Company was incorporated, does not have a tax treaty with the PRC. In accordance with the accounting guidance, all undistributed earnings are presumed to be transferred to the parent company and are subject to the withholding taxes. All FIEs are subject to the withholding tax from January 1, 2008. The presumption may be overcome if we have sufficient evidence to demonstrate that the undistributed dividends will be re-invested and the remittance of the dividends will be postponed indefinitely. We did not record any dividend withholding tax, as we have no retained earnings for any of the years presented.

The EIT Law also provides that an enterprise established under the laws of a foreign country or region but whose "de facto management body" is located in the PRC be treated as a "resident enterprise" and consequently be subject to the PRC income tax at the rate of 25% for its global income. The EIT Law defines the location of the "de facto management body" as "the place where the exercising, in substance, of the overall management and control of the production and business operation, personnel, accounting, properties and others of a non-PRC company is located." Based on a review of surrounding facts and circumstances, we do not believe that it is likely that our operations outside of the PRC will be considered a resident enterprise for PRC tax purposes. However, due to limited guidance and implementation history of the EIT Law, there is uncertainty as to the application of the EIT Law. If our holding company in the Cayman Islands or any of our subsidiaries outside of China were deemed to be a resident enterprise under the EIT Law, it would be subject to enterprise income tax on its worldwide income at a uniform enterprise income tax rate of 25%.

**Results of Operations**

The following table sets forth a summary of our consolidated results of operations for the six months ended June 30, 2025 and for the fiscal years ended December 31, 2022, 2023, and 2024, respectively, presented both in absolute amounts and as percentages of our total revenue. This information should be read together with our consolidated financial statements and related notes included elsewhere in this prospectus. The results of operations in any particular period are not indicative of our future trends.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2024** | **2025** | **2025** | **2025** |
|  | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(Amounts in thousands, except for percentages)** | **(Amounts in thousands, except for percentages)** | **(Amounts in thousands, except for percentages)** | **(Amounts in thousands, except for percentages)** | **(Amounts in thousands, except for percentages)** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| **Revenue** |  |  |  |  |  |
| Sourcing services | 75 | 0.6 | 2812 | 393 | 15.9 |
| Product sales | 12389 | 93.9 | 13899 | 1940 | 78.4 |
| Battery-swapping services | 726 | 5.5 | 343 | 48 | 1.9 |
| Two-wheeled vehicle battery-swapping services | - | - | 675 | 94 | 3.8 |
| **Total revenue** | **13190** | **100.0** | **17729** | **2475** | **100.0** |
| Cost of revenue | (11902) | (90.2) | (9338) | (1304) | (52.7) |
| **Gross profit** | **1288** | **9.8** | **8391** | **1171** | 47.3 |
| **Operating expenses** |  |  |  |  |  |
| Selling expenses | (1483) | (11.2) | (1767) | (247) | (10.0) |
| General and administrative expenses | (26157) | (198.3) | (24571) | (3430) | (138.6) |
| Research and development expenses | (575) | (4.4) | (3416) | (477) | (19.3) |
| Allowance for expected credit losses | 531 | 4.0 | 3903 | 545 | 22.0 |
| **Total operating expenses** | **(27684)** | **(209.9)** | **(25851)** | **(3609)** | **(145.8)** |
| **Operating loss** | **(26396)** | **(200.1)** | **(17460)** | **(2438)** | **(98.5)** |
| Interest income | 7 | 0.1 | 16 | 2 | 0.1 |
| Interest expenses | (877) | (6.6) | (248) | (35) | (1.4) |
| Other income | 1435 | 10.9 | 3917 | 547 | 22.1 |
| Other expenses | (685) | (5.2) | (13301) | (1857) | (75.0) |
| **Loss before income taxes** | **(26516)** | **(201.0)** | **(27076)** | **(3781)** | **(152.7)** |
| Income tax expenses | - | - | (326) | (46) | (1.8) |
| **Net loss** | **(26516)** | **(201.0)** | **(27402)** | **(3827)** | **(154.6)** |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** |
|  | **2022** | **2022** | **2023** | **2023** | **2024** | **2024** | **2024** |
|  | **RMB** | **%** | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
| **Revenue** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Sourcing services | 4428 | 56.8 | 1513 | 7.7 | 63 | 9 | 0.1 |
| &nbsp;&nbsp;&nbsp;Product sales | 3061 | 39.3 | 17062 | 86.3 | 41819 | 5729 | 94.5 |
| &nbsp;&nbsp;&nbsp;Battery-swapping services | 307 | 3.9 | 1189 | 6.0 | 1177 | 161 | 2.7 |
| &nbsp;&nbsp;&nbsp;Two-wheeled vehicle battery-swapping services | - | - | - | - | 1231 | 169 | 2.8 |
| **Total revenue** | **7796** | **100.0** | **19764** | **100.0** | **44290** | **6068** | **100.0** |
| Cost of revenue | (5137) | (65.9) | (7592) | (38.4) | (33827) | (4634) | (76.4) |
| **Gross profit** | **2659** | **34.1** | **12172** | **61.6** | **10463** | **1434** | **23.6** |
| **Operating expenses** |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Selling expenses | (2041) | (26.2) | (2477) | (12.5) | (2789) | (382) | (6.3) |
| &nbsp;&nbsp;&nbsp;General and administrative expenses | (37714) | (483.8) | (41222) | (208.6) | (46910) | (6427) | (105.9) |
| &nbsp;&nbsp;&nbsp;Research and development expenses | (9352) | (120.0) | (2184) | (11.1) | (2985) | (409) | (6.7) |
| &nbsp;&nbsp;&nbsp;Loss on impairment of long-lived assets and long-term investment |  |  | (1996) | (10.1) | (10504) | (1439) | (23.7) |
| &nbsp;&nbsp;&nbsp;Allowance for expected loss | (9801) | (125.7) | (1196) | (6.1) | (5264) | (721) | (11.9) |
| **Total operating expenses** | **(58908)** | **(755.7)** | **(49075)** | **(248.3)** | **(68452)** | **(9378)** | **(154.6)** |
| **Operating loss** | **(56249)** | **(721.6)** | **(36903)** | **(186.7)** | **(57989)** | **(7944)** | **(130.9)** |
| Interest income | 49 | 0.6 | 562 | 2.8 | 742 | 102 | 1.7 |
| Interest expenses | (764) | (9.8) | (1860) | (9.4) | (1402) | (192) | (3.2) |
| Other income | 3206 | 41.1 | 16927 | 85.6 | 5612 | 769 | 12.7 |
| Other expense | (3904) | (50.1) | (1579) | (8.0) | (3325) | (456) | (7.5) |
| **Loss before income tax** | **(57662)** | **(739.8)** | **(22853)** | **(115.7)** | **(56362)** | **(7721)** | **(127.3)** |
| Income tax expenses | (5) | (0.1) | (2613) | (13.2) | - | - | - |
| **Net loss** | **(57667)** | **(739.9)** | **(25466)** | **(128.9)** | **(56362)** | **(7721)** | **(127.3)** |

---

***Six months ended June 30, 2025 compared to Six months ended June 30, 2024***

 

*Revenue*

Our revenue increased by approximately 34.4% from RMB13.2 million for the six months ended June 30, 2024 to RMB17.7million (US$2.5 million) for the six months ended June 30, 2025, which was primarily due to the Group's performance in overseas markets for the six months ended June 30, 2025, particularly in Thailand.

*Cost of revenue*

Our total cost of revenue decreased by approximately 21.5% from approximately RMB11.9 million for the six months ended June 30, 2024 to RMB9.3 million (US$1.3 million) for the six months ended June 30, 2025. The decrease was primarily due to the decreased cost of product sales of battery-swapping stations for the six months ended June 30, 2025.

*Gross Profit*

As a result of the factors set out above, our gross profit increased by approximately 551.5% from RMB1.29 million for the six months ended June 30, 2024 to RMB8.39 million (US$1.17 million) for the six months ended June 30, 2025. The expansion of the battery-swapping station business in overseas markets led to the increase of gross profit for the six months ended June 30, 2025.

 

*Sales and marketing expenses*

Our sales and marketing expenses increased by approximately 19.2% from RMB1.5 million for the six months ended June 30, 2024 to RMB1.8 million (US$0.2 million) for the six months ended June 30, 2025, which was primarily attributable to an increase in advertising expenditures in connection with our business expansion initiatives for the six months ended June 30, 2025.

 

*General and administrative expenses*

Our general and administrative expenses decreased by approximately 6.1% from RMB26.2 million for the six months ended June 30, 2024 to RMB24.6 million (US$3.4 million) for the six months ended June 30, 2025. The decrease was primarily due to a decrease in legal advisory expenses for the six months ended June 30, 2025.

 

*Research and development expenses*

Our research and development expenses significantly increased by approximately 494.1% from RMB0.6 million for the six months ended June 30, 2024 to RMB3.4 million (US$0.5 million) for the six months ended June 30, 2025, primarily due to the increased UOTTA technology innovation activities related to our research and development programs.

*Allowance for expected loss*

We recorded expected credit losses of RMB0.5 million and RMB3.9 million (US$0.6 million) for the six months ended June 30, 2024 and 2025, respectively. The increase was primarily due to higher estimated potential uncollectible amounts for advances to suppliers and other current assets for the six months ended June 30, 2025, based on our collectability assessment.

 

*Interest income and expenses*

Interest income increased from RMB0.01 million for the six months ended June 30, 2024 to RMB0.02 million (US$0.002 million) for the six months ended June 30, 2025, primarily due to the increase of bank interest income in such period. Interest expenses decreased from RMB0.9 million for the six months ended June 30, 2024 to RMB0.2 million (US$0.04 million) for the six months ended June 30, 2025, primarily due to the decrease of loan interest paid.

*Other income*

We recorded other income of approximately RMB1.4 million and RMB3.9 million (US$0.5 million) for the six months ended June 30, 2024 and 2025, respectively. The increase of other income for the six months ended June 30, 2025 was mainly due to an increase in government grants recognized.

 

*Other expenses*

The other expenses increased from RMB0.7 million for the six months ended June 30, 2024 to RMB13.3 million (US$1.9 million) for the six months ended June 30, 2025, primarily due to costs associated with two litigation matters incurred during the six months ended June 30, 2025.

 

*Income tax expenses*

We recorded income tax expenses of nil and RMB0.3 million (US$0.05 million) for the six months ended June 30, 2024 and 2025, respectively. The increase was primarily due to the increase of taxable income generated from operations of our subsidiaries in Thailand.

 

*Net loss*

As a result of the foregoing, we incurred a net loss of RMB26.5 million and RMB27.4 million (US$3.8 million) for the six months ended June 30, 2024 and 2025, respectively.

***Fiscal Year ended December 31, 2024 compared to fiscal year ended December 31, 2023***

 

*Revenue*

Our revenue increased by approximately 124.1% from RMB19.8 million for the fiscal year ended December 31, 2023 to RMB44.3million (US$6.1 million) for the fiscal year ended December 31, 2024. The increase was primarily due to the increased product sales of battery-swapping stations during the fiscal year ended December 31, 2024. 

*Cost of revenue*

Our total cost of revenue increased by approximately 345.6% from approximately RMB7.6 million for the fiscal year ended December 31, 2023 to RMB33.8 million (US$4.6 million) for the fiscal year ended December 31, 2024. The increase was primarily due to the increased cost of product sales of battery-swapping stations for the fiscal year ended December 31, 2024.

 

*Gross Profit*

As a result of the factors set out above, our gross profit decreased by approximately 14.0% from RMB12.2 million for the fiscal year ended December 31, 2023 to RMB10.5 million (US$1.4 million) for the fiscal year ended December 31, 2024.

 

*Sales and marketing expenses*

Our sales and marketing expenses increased by approximately 12.6% from RMB2.5 million for the fiscal year ended December 31, 2023 to RMB2.8 million (US$0.4 million) for the fiscal year ended December 31, 2024, primarily attributable to the increased sales and marketing expenditures incurred for the Group's business expansion.

 

*General and administrative expenses*

Our general and administrative expenses increased by approximately 13.8% from RMB41.2 million for the fiscal year ended December 31, 2023 to RMB46.9 million (US$6.4 million) for the fiscal year ended December 31, 2024. The increase was primarily driven by the increased administrative personnel costs and material consumption associated with the Group's business expansion.

 

 

*Research and development expenses*

Our research and development expenses increased by approximately 36.6% from RMB2.2 million for the fiscal year ended December 31, 2023 to RMB3.0 million (US$0.4 million) for the fiscal year ended December 31, 2024, primarily due to the increased UOTTA technology innovation activities related to research and development programs.

 

*Loss on impairment of long-lived assets*

 

The loss on impairment of long-lived assets were recognized as RMB1.9 million and RMB10.5 million (US$1.4 million) for the years ended December 31, 2023 and 2024, respectively, primarily due to the impairment recognized of long-unused production line and the long-term investment impairment due to the deregistration of a company in which the Group invested.

 

*Allowance for expected loss*

The allowance for expected loss were recognized as RMB1.2 million and RMB5.3 million (US$0.7 million) for the years ended December 31, 2023 and 2024, respectively. The increase was primarily due to higher estimated potential uncollectible amounts for advances to suppliers and other current assets for the fiscal year ended December 31, 2024, based on our collectability assessment.

 

*Interest income*

Our interest income increased from RMB0.6 million for the fiscal year ended December 31, 2023 to RMB0.7 million for the fiscal year ended December 31, 2024, primarily due to the accrual of interest on other long-term assets.

*Interest expenses*

Our interest expenses decreased by approximately 24.6% from RMB1.9 million for the fiscal year ended December 31, 2023 to RMB1.4 million (US$0.2 million) for the fiscal year ended December 31, 2024, mainly due to changes in the exchange rate.

 

*Other income*

We recorded other income of approximately RMB16.9 million and RMB5.6 million (US$0.8 million) for the years ended December 31, 2023 and 2024, respectively. The decrease in other income was mainly due to a reduction in government grants recognized.

 

*Other expenses*

The other expenses increased from RMB1.6 million for the fiscal year ended December 31, 2023 to RMB3.3 million (US$0.5 million) for the fiscal year ended December 31, 2024, primarily due to increased investment loss during the fiscal year ended December 31, 2024.

 

*Income tax expenses*

We recorded income tax expenses of approximately RMB2.6 million and nil for the years ended December 31, 2023 and 2024, respectively. The decrease was primarily due to the decrease of taxable income generated from operations of our subsidiaries in China.

 

*Net loss*

As a result of the foregoing, we incurred a net loss which increased by approximately 121.3% from RMB25.5 million for the fiscal year ended December 31, 2023 to RMB 56.4 million (US$7.7 million) for the fiscal year ended December 31, 2024.

***Fiscal Year ended December 31, 2023 compared to fiscal year ended December 31, 2022***

 

*Revenue*

Our revenue increased by approximately 153.5% from RMB7.8 million for the fiscal year ended December 31, 2022 to RMB19.8 million for the fiscal year ended at December 31, 2023. The increase was primarily due to the increased product sales of battery-swapping stations during the fiscal year ended December 31, 2023. 

*Cost of revenue*

Our total cost of revenue increased by approximately 47.8% from approximately RMB5.1 million for the fiscal year ended December 31, 2022 to RMB7.6 million for the fiscal year ended December 31, 2023. The increase was primarily due to the increased cost of product sales of battery-swapping stations during the fiscal year ended December 31, 2023.

 

*Gross Profit*

As a result of the factors set out above, our gross profit increased by approximately 351.8% from RMB2.7 million for the fiscal year ended December 31, 2022 to RMB12.2 million for the fiscal year ended December 31, 2023. The increased product sales of battery-swapping stations primarily led to the increase in gross profit during the fiscal year ended December 31, 2023.

 

*Sales and marketing expenses*

Our sales and marketing expenses increased by approximately 25.0% from RMB2.0 million for the fiscal year ended December 31, 2022 to RMB2.5 million for the fiscal year ended December 31, 2023, primarily due to the increase in employee benefits during the fiscal year ended December 31, 2023.

 

*General and administrative expenses*

Our general and administrative expenses increased by approximately 9.3% from RMB37.7 million for the fiscal year ended December 31, 2022 to RMB41.2 million or the fiscal year ended December 31, 2023. The increase was primarily due to the increase in salary and service charge expenses.

 

*Research and development expenses*

Our research and development expenses decreased by approximately 76.6% from RMB9.4 million for the fiscal year ended December 31, 2022 to RMB2.2 million for the fiscal year ended December 31, 2023, primarily due to the decreased UOTTA technology innovation activities related to research and development programs.

 

*Loss on impairment of long-lived assets*

 

The loss on impairment of long-lived assets were recognized as nil and RMB1.9 million for the years ended December 31, 2022 and 2023, respectively, primarily due to the impairment recognized of long-unused production line and the long-term investment impairment due to the deregistration of a company in which the Group invested.

 

*Allowance for doubtful accounts*

The allowance for doubtful accounts were recognized as RMB9.8 million and RMB1.2 million for the years ended December 31, 2022 and 2023, respectively. The decrease was primarily due to a lower estimated impact of potential uncollectible amounts for advances to suppliers and other current assets for the fiscal year ended December 31, 2023, as determined by our collectability assessment and improved receivable collections.

*Interest income*

Our interest income increased from RMB0.05 million for the fiscal year ended December 31, 2022 to RMB0.6 million for the fiscal year ended December 31, 2023, primarily due to interest income generated from our loans to a third party during the fiscal year ended December 31, 2023.

*Interest expenses*

Our interest expenses increased by approximately 137.5% from RMB0.8 million for the fiscal year ended December 31, 2022 to RMB1.9 million for the fiscal year ended December 31, 2023, primarily due to interest expenses generated from our long-term borrowings and loan payables during the fiscal year ended December 31, 2023.

 

*Other income*

We recorded other income of approximately RMB3.2 million and RMB16.9 million for the years ended December 31, 2022 and 2023, respectively. The increase in other income during the fiscal year ended December 31, 2023 was mainly due to an increase in government grants recognized.

 

*Other expenses*

The other expenses decreased from RMB3.9 million for the fiscal year ended December 31, 2022 to RMB1.6 million for the fiscal year ended December 31, 2023, primarily due to the decreased investment loss during the fiscal year ended December 31, 2023.

 

*Income tax expenses*

We recorded income tax expenses of approximately RMB5,000 and RMB2.6 million for the years ended December 31, 2022 and 2023, respectively. The increase was primarily due to the increase in taxable income generated from operations of our subsidiaries in China.

 

*Net loss*

As a result of the foregoing, we incurred a net loss which decreased by approximately 55.8% from RMB57.7 million for the fiscal year ended December 31, 2022 to RMB25.5 million for the fiscal year ended December 31, 2023.

**Liquidity and Capital Resources**

Our primary source of liquidity historically has been cash generated from our business operations, bank loans, equity contributions from our shareholders and borrowings, which have historically been sufficient to meet our working capital and capital expenditure requirements.

As of the fiscal year ended December 31, 2024 and the six months ended June 30, 2025, the Group's cash and cash equivalents were RMB24.7 million and RMB22.7 million (US$3.2 million), respectively, and the Group's restricted cash was RMB1.2 million and RMB0.3 million (US$0.04 million), respectively. As of December 31, 2022 and 2023, the Group's cash and cash equivalents and restricted cash were RMB5,908 and RMB36,239, respectively. The Group's cash and cash equivalents primarily consist of cash on hand and highly liquid investments placed with banks, which are unrestricted to withdrawal and use and which have original maturities of three months or less.

On December 13, 2021, Youxu Zibo entered into a bank facility agreement with Bank of Qishang, a commercial bank in China, for the principal amount of RMB10.0 million, and with a weighted average interest rate of 6.87% per annum and a term of three years. On December 6, 2024, Youxu Zibo entered into an extension agreement with the bank, pursuant to which the remaining principal balance of RMB6.5 million is repayable in installments, with the final payment due no later than June 3, 2026. The loan continues to bear interest at an annual rate of 6.87%, consistent with the original terms. As of June 30, 2025, the outstanding balance of the bank loan was RMB5.8 million.

The Group believes that the substantial doubt of its ability to continue as going concern is alleviated based on proceeds received from its new investors and proceeds to be received from its potential investors in any future financing transactions. The Group also believe its existing cash and cash equivalents, anticipated cash raised from financings, and anticipated cash flow from operations, together with the net proceeds from its new investors, will be sufficient to meet its anticipated cash needs for the next 12 months from the date of this prospectus. The exact amount of proceeds the Group used for its operations and expansion plans will depend on the amount of cash generated from its operations and any strategic decisions the Group may make that could alter its expansion plans and the amount of cash necessary to fund these plans.

We may, however, decide to enhance our liquidity position or increase our cash reserve for future investments through additional capital and finance funding. We may need additional cash resources in the future if we experience changes in business conditions or other developments, or if we find and wish to pursue opportunities for investments, acquisitions, capital expenditures or similar actions. If we determine that our cash requirements exceed the amount of cash and cash equivalents we have on hand at the time, we may seek to issue equity or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result in increased fixed obligations and could result in operating covenants that would restrict our operations. We cannot assure you that financing will be available in amounts or on terms acceptable to us, if at all.

Our ability to manage our working capital, including receivables and other assets and liabilities and accrued liabilities, may materially affect our financial condition and results of operations.

The following table sets forth a summary of our cash flows for the years presented:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2025** | **2025** |
|  | **RMB** | **RMB** | **US$** |
|  | **(Amounts in thousands)** | **(Amounts in thousands)** | **(Amounts in thousands)** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| **Summary Consolidated Cash Flow:** |  |  |  |
| Net cash used in operating activities | (31774) | (35934) | (5016) |
| Net cash provided by investing activities | 13473 | 68 | 10 |
| Net cash provided by financing activities | 22577 | 32581 | 4548 |
| Net change in cash and cash equivalents and restricted cash | 4276 | (3285) | (458) |
| Cash and cash equivalents and restricted cash, at beginning of period | 36239 | 24674 | 3444 |
| **Cash and cash equivalents and restricted cash, at end of period** | **40515** | **22997** | **3210** |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
|  | **(in thousands)** | **(in thousands)** | **(in thousands)** | **(in thousands)** |
| **Summary Consolidated Cash Flow:** | (12892) | (65442) | (73170) | (10025) |
| Net cash used in operating activities | (11387) | (84076) | 49093 | 6726 |
| Net cash (used)/provided in investing activities | 4500 | 179403 | 12958 | 1776 |
| Net cash provided by financing activities | (19779) | 29885 | (11119) | (1523) |
| Net increase in cash and cash equivalents and restricted cash |  | 446 | (446) | (61) |
| Effects of exchange rate changes | 25687 | 5908 | 36239 | 4965 |
| **Cash and cash equivalents and restricted cash, at beginning of year** | **5908** | **36239** | **24674** | **3381** |

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***Operating Activities***

Net cash used in operating activities was RMB35.9 million (US$5.0 million) in the six months ended June 30, 2025, primarily due to a net loss of RMB27.4 million (US$3.8million), adjusted to add back depreciation and amortization of property and equipment and intangible assets of RMB1.6 million (US$0.2 million), amortization of right-of-use assets of RMB4.2 million (US$0.6 million), and reversal of allowance for doubtful accounts of RMB3.9 million (US$0.5 million). The amount was further adjusted by changes in itemized balances of operating assets and liabilities that have a negative effect on cash flow, including primarily (i) an increase in accounts receivable of RMB8.0 million (US$1.1 million) in relation to the provision of battery-swapping services; (ii) an increase in inventory of RMB3.1 million (US$0.4 million) in relation to materials for battery-swapping stations production; and (iii) an increase in other current assets of RMB4.6 million (US$0.7 million), as well as certain changes in itemized balances of operating assets and liabilities that have a positive effect on cash flow, including, primarily, an increase in accounts payable of RMB2.9 million (US$0.4 million) in relation to the grace period we enjoyed for the payments payable to third-party suppliers.

Net cash used in operating activities was RMB31.8 million in the six months ended June 30, 2024, primarily due to a net loss of RMB26.5 million, adjusted to add back depreciation and amortization of property and equipment and intangible assets of RMB2.6 million and amortization of right-of-use assets of RMB2.8 million. The amount was further adjusted by changes in itemized balances of operating assets and liabilities that have a negative effect on cash flow, including primarily (i) an increase in accounts receivable of RMB2.8 million in relation to the provision of battery-swapping services; (ii) an increase in inventory of RMB0.6 million in relation to materials for battery-swapping stations production; and (iii) a decrease in other current assets of RMB3.1 million, as well as certain changes in itemized balances of operating assets and liabilities that have a positive effect on cash flow, including, primarily, an increase in accounts payable of RMB7.9 million in relation to the grace period we enjoyed for the payments payable to third-party suppliers.

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Our net cash used in operating activities increased from RMB65.4 million for the fiscal year ended December 31, 2023 to RMB73.2 million for the fiscal year ended December 31, 2024. We recorded net cash used in operating activities of approximately RMB 73.2 million for the fiscal year ended December 31, 2024. The difference between our net loss of approximately RMB7.8 million and the net cash used in operating activities was primarily due to (i) an adjustment of approximately RMB24.5 million in non-cash items, which mainly consisted of depreciation and amortization of RMB3.1 million, amortization of right-of-use assets of RMB5.5 million, allowance for expected loss of RMB5.3 million, an impairment of long-term investment of RMB10.5 million; (ii) an increase in other current and non-current assets of RMB37.5 million due to the increased loans to third parties; and (iii) an increase in amounts due from related parties of RMB1.5 million, primarily attributable to increased cash outflows from financial support provided to related parties for their business operations.

Net cash used in operating activities of approximately RMB65.4 million for the fiscal year ended December 31, 2023. The difference between our net loss of approximately RMB25.5 million and the net cash used in operating activities was primarily due to (i) an adjustment of approximately RMB11.6 million in non-cash items, which mainly consisted of depreciation and amortization of RMB2.6 million, amortization of right-of-use assets of RMB5.7 million, a provision of impairment for fixed assets of RMB1.9 million, allowance for expected loss of RMB1.2 million, an impairment of long-term investment of RMB0.1 million and investment loss of RMB0.1 million; (ii) an increase in accounts receivable of RMB14.2 million in relation to the provision of sourcing services and sales of battery-swapping stations; (ii) an increase in other current assets of RMB21.2 million due to the increased loans to third parties; and (iii) an increase in advance to suppliers of RMB3.9 million, partially offset by (i) an increase in accrued expenses and other current liabilities of RMB15.1 million; (ii) an increase in amount due to related parties of RMB5.2 million; and (iii) an increase in lease liabilities of RMB3.5 million.

Net cash used in operating activities was RMB12.9 million (US$1.9 million) for the fiscal year ended December 31, 2022, primarily due to a net loss of RMB57.7 million (US$8.4 million), adjusted to add back (i) depreciation and amortization of property and equipment and intangible assets of RMB2.1 million (US$0.3 million); (ii) amortization of right-of-use assets of RMB5.6 million (US$0.8 million); (iii) a provision for doubtful accounts of RMB9.8 million (US$1.4 million); and (iv) a loss on lease termination of right-of-use assets of RMB1.8 million (US$0.3 million). The amount was further adjusted by changes in itemized balances of operating assets and liabilities that have a negative effect on cash flow, including primarily (i) an increase in accounts receivable of RMB1.4 million (US$0.2 million) in relation to the provision of sourcing services and sales of battery-swapping stations; (ii) an increase in other current assets of RMB23.0 million (US$3.3 million) due to the increased loans to third parties; and (iii) a decrease in advance from customers of RMB50.4 million (US$7.3 million) due to the decreased purchase from our vehicle sourcing suppliers as a result of the decreased vehicle sourcing revenue in 2022, as well as certain changes in itemized balances of operating assets and liabilities that have a positive effect on cash flow, including, primarily (i) a decrease in inventory of RMB7.8 million (US$1.1 million); (ii) a decrease in advances to suppliers of RMB61.1 million (US$8.9 million) due to the extension of payable recoverable period with the suppliers; and (iii) an increase in accrued expenses and other current liabilities of RMB32.2 million (US$4.7million) primarily in relation to the increased loans from a third party and the potential refundable government grants.

***Investing Activities***

Net cash used in investing activities for the six months ended June 30, 2025 was RMB0.07 million (US$0.01 million), mainly attributable to repayments of loans from third parties of RMB20.1 million and payments of loans provided to related parties of RMB20 million.

Net cash provided in investing activities for the fiscal year ended December 31, 2024 was RMB49.1 million (US$6.7 million), mainly consisted of the loans repayments from third parties of RMB16.7 million (US$2.3 million) and repayments of refundable deposits for investment of RMB33.0 million (US$4.5 million).

Net cash used in investing activities for the fiscal year ended December 31, 2023 was RMB84.1 million, mainly consisted of the loans provided to the third parties of RMB34.0 million and payments for long-term investment of RMB11.8 million, partially offset by the proceeds of loans from third parties. The increase in the net cash used in investing activities for the fiscal year ended December 31, 2023 was due to the increase of payments of loans provided to the third parties.

Net cash used in investing activities for the fiscal year ended December 31, 2022 was RMB11.4 million, mainly due to the increase of property and equipment purchase of RMB7.8 million and the payments of loans to third parties of RMB3.9 million.

***Financing Activities***

Net cash provided by financing activities for the six months ended June 30, 2025 was RMB32.6 million (US$4.6 million), mainly attributable to capital contribution from issuance of ordinary shares of RMB33.4 million (US$4.7 million).

Net cash provided by financing activities for the fiscal year ended December 31, 2024 was RMB13.0 million (US$1.8 million), mainly consisted of the proceeds of capital contribution from insurance of ordinary shares of RMB25.9 million (US$3.5 million) and proceeds from short-term bank borrowings of RMB10.2 million (US$1.4 million). On the other hand, the repayments of bank loans during the fiscal year ended December 31, 2024 resulted in a reduction of RMB20.1 million (US$2.8 million) in cash flows from financing activities.

Net cash provided by financing activities for the fiscal year ended December 31, 2023 was RMB179.4 million, mainly consisted of the proceeds of capital contribution from insurance of ordinary shares of RMB156.2 million, proceeds from the loans from third parties of RMB15.0 million, capital contribution from non-controlling shareholders of RMB5.0 million, and proceeds from short-term bank borrowings of RMB5.0 million, partially offset by the redemption of long-term bank borrowings of RMB1.3 million. The increase of net cash provided by investing activities for the fiscal year ended December 31, 2023 was due to the increase of proceeds of capital contribution from issuance of ordinary shares.

Net cash provided by financing activities for the fiscal year ended December 31, 2022 was RMB4.5 million, mainly due to the proceeds of capital contribution by a shareholder of RMB5.0 million and partially offset by the redemption of long-term bank borrowings of RMB0.5 million.

**Holding Company Structure**

U Power Limited, our holding company, has no material operations of its own. We conduct our operations primarily through our subsidiaries in the PRC. As a result, U Power Limited's ability to pay dividends depends upon dividends paid by our subsidiaries in the PRC. If our existing PRC subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. In addition, our subsidiaries in China are permitted to pay dividends to us only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. Under PRC law, each of our subsidiaries in China is required to set aside at least 10% of its after-tax profits each year, if any, to fund certain statutory reserve funds until such reserve funds reach 50% of its registered capital. In addition, our subsidiaries in China may allocate a portion of their after-tax profits based on PRC accounting standards to enterprise expansion funds and staff bonus and welfare funds at their discretion. The statutory reserve funds and the discretionary funds are not distributable as cash dividends. Remittance of dividends by a wholly foreign-owned company out of China is subject to examination by the banks designated by the SAFE. Our PRC subsidiaries have not paid dividends and will not be able to pay dividends until they generate accumulated profits and meet the requirements for statutory reserve funds.

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***Borrowing*s**

The following table sets forth the breakdown of our borrowings as of the dates indicated:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Short-term bank borrowing |  | 5000 | 15172 | 2078 |
| Long-term bank borrowing, current portion |  | 9500 | 2800 | 384 |
| Long-term bank borrowing, non-current portion | 10000 | - | 3700 | 507 |
|  | **10000** | **14500** | **21672** | **2969** |

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| | | |
|:---|:---|:---|
|  | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **US$** |
|  | **(Unaudited)** | **(Unaudited)** |
| Short-term bank borrowing | 17172 | 2397 |
| Long-term bank borrowing, current portion | 5800 | 810 |
| Long-term bank borrowing, non-current portion | - | - |
|  | **22972** | **3207** |

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On February 21, 2025, SH Youxu entered into an one-year short-term bank loan with Agricultural Bank of China of RMB2 million, at an annual interest rate of 3.45%.

In 2024, both SH Youxu and Youpin Shandong fully repaid their aggregate short-term bank borrowings of RMB5.0 million, originally obtained in 2023. Subsequent to these repayments, Youpin Shandong entered into a one-year short-term bank loan of RMB0.3 million with China Construction Bank on August 19, 2024, at an annual interest rate of 3.95%, and an additional RMB0.9 million loan on August 21, 2024 with China Construction Bank, at an annual interest rate of 3.75%. Separately, SH Youxu obtained two one-year short-term bank facilities: RMB10.0 million on August 16, 2024 and RMB 4.0 million on September 29, 2024 with Shanghai Pudong Development Bank, both bearing an annual interest rate of 3.45%.

On December 13, 2021, Youxu Zibo entered into a bank facility agreement with Bank of Qishang for a principal amount of RMB10.0 million and with a weighted average interest rate of 6.87% per annum and a term of three years. On December 6, 2024, Youxu Zibo entered into an extension agreement with the bank, pursuant to which the remaining principal balance of RMB6.5 million is repayable in installments, with the final payment due no later than June 3, 2026. The loan continues to bear interest at an annual rate of 6.87%, consistent with the original terms. As of June 30, 2025, the outstanding balance of the bank loan was RMB5.8 million.

**Contractual Obligations**

The following table sets forth our contractual obligations as of June 30, 2025:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** |
|  | **Total** | **Total** | **Less than<br> 1 year** | **1-3 years** | **3-5 years** | **More than<br> 5 years** |
|  | **RMB** | **US$** | | | | |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
|  | **(Amounts in thousands)** | **(Amounts in thousands)** | **(Amounts in thousands)** | **(Amounts in thousands)** | **(Amounts in thousands)** | **(Amounts in thousands)** |
| Current portion of long-term borrowing | 5800 | 810 | 5800 |  |  |  |
| Short-term bank borrowing | 17172 | 2397 | 17172 |  |  |  |
| Operating lease liabilities | 5974 | 834 | 2282 | 3140 | 552 |  |
| **Total** | **28946** | **4041** | **25254** | **3140** | **552** |  |

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The following table sets forth our contractual obligations as of December 31, 2024:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** |
|  | **Total** | **Total** | **Less than<br> 1 year** | **1-3 years** | **3-5 years** | **More than<br> 5 years** |
|  | **RMB** | **US$** | | | | |
| Long-term bank borrowings | 6970 | 955 | 3164 | 3806 |  |  |
| Short-term bank borrowing | 15522 | 2127 | 15522 |  |  |  |
| Loans from third parties | 4787 | 656 | 4787 |  |  |  |
| Operating lease liabilities | 7099 | 973 | 2262 | 3274 | 1244 | 319 |
| Payment to Anhui Juhu | 200 | 27 | 200 |  |  |  |
| **Total** | **34578** | **4738** | **25935** | **7080** | **1244** | **319** |

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The following table sets forth our contractual obligations as of December 31, 2023:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** |
|  | **Total** | **Total** | **Less than<br> 1 year** | **1-3 years** | **3-5 years** | **More than<br> 5 years** |
|  | **RMB** | **US$** | | | | |
| Long-term bank borrowings | 9500 | 1338 | 9500 |  |  |  |
| Short-term bank borrowing | 5000 | 704 | 5000 |  |  |  |
| Operating lease liabilities | 9351 | 1317 | 2250 | 4290 | 2025 | 786 |
| Loan payable to WuYi Transportation Construction Investment Group Company Limited ("WuYi Transportation Construction") | 5200 | 732 | 5200 | - | - | - |
| **Total** | **29051** | **4091** | **21950** | **4290** | **2025** | **786** |

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The following table sets forth our contractual obligations as of December 31, 2022:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** |
|  | **Total** | **Total** | **Less than<br> 1 year** | **1-3 years** | **3-5 years** | **More than<br> 5 years** |
|  | **RMB** | **US$** | | | | |
| Long-term bank borrowings | 10000 | 1450 |  | 10000 |  |  |
| Operating lease liabilities | 6485 | 940 | 1696 | 1785 | 1991 | 1013 |
| Loan payable to WuYi Transportation Construction | 6500 | 942 | 6500 |  |  |  |
| Payables to Ningbo Meishan Bonded Port Zone Chenhui Investment Partnership Enterprise (Limited Partnership) | 1281 | 186 | 1281 | - | - | - |
| **Total** | **24266** | **3518** | **9477** | **11785** | **1991** | **1013** |

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**Off-Balance Sheet Arrangements**

From August 2020 to November 2021, Youguan Financial Leasing provided a total of RMB5,869 (US$827) guarantee to its four customers who entered into two five-year guarantees and two four-year guarantees. As of the date of this prospectus, the balance of the guarantees were RMB783.

We have not entered into any derivative contracts that are indexed to our shares and classified as shareholder's equity or that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us.

**Trend Information**

Other than as described elsewhere in this prospectus, we are not aware of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material adverse effect on our revenue, income from continuing operations, profitability, liquidity or capital resources, or that would cause our reported financial information not necessarily to be indicative of future operating results or financial condition.

**Critical Accounting Policies and Estimates**

An accounting policy is considered critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time such estimate is made, and if different accounting estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the consolidated financial statements.

We prepare our consolidated financial statements in conformity with U.S. GAAP, which requires us to make judgments, estimates, and assumptions. We continually evaluate these estimates and assumptions based on the most recently available information, our own historical experiences, and other assumptions that we believe to be reasonable under the circumstances. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from our expectations as a result of changes in our estimates. Some of our accounting policies require a higher degree of judgment than others in their application and require us to make significant accounting estimates.

The following descriptions of critical accounting policies, judgments, and estimates should be read in conjunction with our consolidated financial statements and other disclosures included in this prospectus. When reviewing our consolidated financial statements, you should consider (i) our selection of critical accounting policies, (ii) the judgments and other uncertainties affecting the application of such policies, and (iii) the sensitivity of reported results to changes in conditions and assumptions.

See our consolidated financial statements and related notes included elsewhere in this prospectus for a description of other significant accounting policies.

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***Revenue recognition***

Under ASC 606, Revenue from Contracts with Customers, we recognize revenue when a customer obtains control of promised goods or services and recognizes in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services.

We recognized revenue according to the following five-step revenue recognition criteria based on ASC 606: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price; and (5) recognize revenue when or as the entity satisfies a performance obligation.

We recognize revenue when or as the control of the goods or services is transferred to a customer. Depending on the terms of the contract and the laws that apply to the contract, control of the goods and services may be transferred over time or at a point in time. Control of the goods and services is transferred over time if our performance:

&nbsp;&nbsp;&nbsp;&nbsp;(i) provides all of the benefits received and consumed simultaneously by the customer; or

&nbsp;&nbsp;&nbsp;&nbsp;(ii) creates and enhances an asset that the customer controls as we perform.

If control of the goods and services transfers over time, revenue is recognized over the period of the contract by reference to the progress towards complete satisfaction of that performance obligation. Otherwise, revenue is recognized at a point in time when the customer obtains control of the goods and services.

Contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on our relative standalone selling price. We generally determine standalone selling prices based on the prices charged to customers. If the standalone selling price is not directly observable, it is estimated using expected cost plus a margin or adjusted market assessment approach, depending on the availability of observable information. Assumptions and estimations have been made in estimating the relative selling price of each distinct performance obligation, and changes in judgments on these assumptions and estimates may impact the revenue recognition.

When either party to a contract has performed, we present the contract in the consolidated balance sheets as a contract asset or a contract liability, depending on the relationship between the entity's performance and the customer's payment.

A contract asset is our right to consideration in exchange for goods and services that we have transferred to a customer. A receivable is recorded when we have an unconditional right to consideration. A right to consideration is unconditional if only the passage of time is required before payment of that consideration is due.

If a customer pays consideration or we have a right to an amount of consideration that is unconditional, before we transfer a good or service to the customer, we present the contract liability when the payment is made, or a receivable is recorded (whichever is earlier). A contract liability is our obligation to transfer goods or services to a customer for which we have received consideration (or an amount of consideration is due) from the customer.

 

 

*Sourcing services*

We generate revenue from the vehicle sourcing business and battery sourcing business.

With respect to the battery sourcing business, we act as a principal, as being able to fully control relevant risks and benefits during the whole business, as indicated by the fact that we can decide the selling price, have a right to recall the product and cease the transaction, and bear relevant risks of damage and loss prior to the delivery of battery to the customer. The sales of battery sourcing revenue are recognized on a gross basis at a point in time when the control of the battery pack is transferred to the customer.

For vehicle sourcing business, we charge service fees from our customers for their purchase of vehicles, where we are generally acting as an agent and our performance obligation is to purchase the specified vehicles for our customers. We charge the customers a commission that is calculated based on the purchase price of each purchase order. Vehicle sourcing service revenue is recognized on a net basis at the point in time when the service of purchase of the specified vehicles for our customers is completed, i.e., the specified vehicle for our customers is delivered. Payments are typically received in advance and are accounted for as contract liabilities until delivery, at which point the receipt in advance from customers is offset with the prepayment to the supplier and the difference representing the commission is recognized as revenue.

*Product sales*

We generate revenue from sales of battery-swapping stations. We identify the users who purchase battery-swapping stations as our customers. The revenue for battery-swapping station sales is recognized at a point in time when the control of the product is transferred to the customer.

 

*Battery-swapping services*

 

We also generate revenue from providing battery-swapping services to vehicle drivers and the station control system upgrading services to the battery-swapping station owners. We identify the vehicle drivers who need the services of battery-swapping and the owners of battery-swapping stations that the Group has sold to who have demands for the station control system upgrading services as our customers.

We charge the battery-swapping service fees from our customers based on vehicle miles traveled. However, as usually, the swapped battery will be immediately used after the payments by customers for driving and the power consumption of vehicles will be fast, we ignore the time interval between the timing of payment in advance by customers and the usage life of the swapped battery. The revenue generated from battery-swapping services to vehicle drivers is recognized at a point in time when the Group received the payment from vehicle drivers.

The revenue generated from the station control system upgrading service is recognized over time based on a straight-line method.

***Inventories***

Inventories, consisting of raw materials, products available for sale, are stated at the lower of cost or net realizable value. Costs of inventory are determined using the first-in-first-out method. We record inventory reserves for obsolete and slow-moving inventory. Inventory reserves are based on inventory obsolescence trends, historical experience and application of the specific identification method.

***Impairment of long-lived assets***

We evaluate our long-lived assets, including property, equipment, software, and right-of-use assets with finite lives, 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 of an asset may not be fully recoverable. When these events occur, we evaluate the recoverability of long-lived assets by comparing the carrying amounts of the assets to the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amounts of the assets, we recognize an impairment loss based on the excess of the carrying amounts of the assets over their fair value. Fair value is generally determined by discounting the cash flows expected to be generated by the assets, when the market prices are not readily available.

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***Long-term investments***

Our long-term investments mainly include equity investments in entities. Investments in entities in which we can exercise significant influence and holds an investment in voting common stock or in-substance common stock (or both) of the investee but does not own a majority equity interest or control are accounted for using the equity method of accounting in accordance with ASC topic 323, Investments - Equity Method and Joint Ventures ("ASC 323"). Under the equity method, we initially record our investments at fair value. We subsequently adjust the carrying amount of the investments to recognize our proportionate share of each equity investee's net income or loss into earnings after the date of investment. We evaluate the equity method investments for impairment under ASC 323. An impairment loss on the equity method investments is recognized in earnings when the decline in value is determined to be other-than-temporary.

***Leases***

We account for lease under ASC Topic 842, Leases. We determine if an arrangement is or contains a lease at inception. Right-of-use assets and liabilities are recognized at lease commencement date based on the present value of remaining lease payments over the lease terms. We consider only payments that are fixed and determinable at the time of lease commencement.

At the commencement date, the lease liability is recognized at the present value of the lease payments not yet paid, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, our incremental borrowing rate for the same term as the underlying lease. The right-of-use asset is recognized initially at cost, which primarily comprises the initial amount of the lease liability, plus any initial direct costs incurred. All right-of-use assets are reviewed for impairment annually. There was no impairment for right-of-use lease assets as of December 31, 2022, 2023, and 2024 or June 30, 2025.

Operating lease assets are included within "right-of-use assets - operating lease", and the corresponding operating lease liabilities are included within "operating lease liabilities" on the consolidated balance sheets as of December 31, 2022, 2023, and 2024 and June 30, 2025, respectively.

**Recent Accounting Pronouncements**

In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments – Credit Losses", which requires the measurement of all allowance for expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Subsequently, the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, to clarify that receivables arising from operating leases are within the scope of lease accounting standards. Further, the FASB issued ASU No. 2019-04, ASU 2019-05, ASU 2019-10, ASU 2019-11, and ASU 2020-02 to provide additional guidance on the credit losses standard, which defers the effective date of ASU No. 2016-13 for smaller reporting companies to fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The impact of the adoption on the consolidated balance sheets, statements of operations, and statements of cash flows was immaterial.

In June 2022, the FASB issued ASU 2023-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. The update clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The update also clarifies that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The update also requires certain additional disclosures for equity securities subject to contractual sale restrictions. The amendments in this update are effective for the Group beginning January 1, 2024 on a prospective basis. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The Group has determined that the adoption of this guidance will not have a material impact on its financial position, results of operations, and cash flows.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which focuses on improving reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. A public entity shall disclose for each reportable segment the significant expense categories and amounts that are regularly provided to the chief operating decision maker ("CODM") and included in reported segment profit or loss. ASU 2023-07 also requires public entities to provide in interim periods all disclosures about a reportable segment's profit or loss and assets that are currently required annually. Entities are permitted to disclose more than one measure of a segment's profit or loss if such measures are used by the CODM to allocate resources and assess performance, as long as at least one of those measures is determined in a way that is most consistent with the measurement principles used to measure the corresponding amounts in the consolidated financial statements. ASU 2023-07 is applied retrospectively to all periods presented in financial statements, unless it is impracticable. This update was effective for the Group's fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. Based on the criteria established by ASC 280, the Group's CODM has been identified as the Group's Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Group. As a whole, the Group has only one reportable segment. The Group does not distinguish between markets or segments for the purpose of internal reporting. As the Group's long-lived assets are substantially located in the PRC, no geographical segments are presented.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740). The update requires specific disaggregated information about a reporting entity's effective tax rate reconciliation as well as additional information on income taxes paid. The update is effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. The Group has determined that the adoption of this policy will not have a material impact on its consolidated financial statements.

**BUSINESS** 

**Overview**

We are a vehicle sourcing service provider in China, with a vision to becoming an EV market player primarily focused on our proprietary battery-swapping technology, or UOTTA technology, which is an intelligent modular battery-swapping technology designed to provide a comprehensive battery power solution for EVs.

Since our commencement of operations in 2013, we have principally engaged in the provision of vehicle sourcing services. We broker sales of vehicles between automobile wholesalers and buyers, including SME dealers and individual customers primarily located in the lower-tier cities in China, which are smaller and less developed than the tier-1 or tier-2 cities. To that end, we have focused on building business relationships with our sourcing partners and have developed a vehicle sourcing network. As of the date of this prospectus, our vehicle sourcing network consisted of approximately 100 wholesalers and 30 SME located in lower-tier cities in China. For the six months ended June 30, 2025, our revenue from the sourcing business was RMB2.8 million, which constituted 15.9% of our total revenue. For the fiscal years ended December 31, 2022, 2023 and 2024, our revenue from the sourcing business was RMB4.4 million, RMB1.5 million and RMB0.1 million, which constituted 56.8%, 7.7% and 0.1%, respectively, of our total revenue.

Beginning in 2020, we gradually shifted our focus from the vehicle sourcing business to the development of our proprietary battery-swapping technology, or UOTTA technology. We plan to develop a comprehensive EV battery power solution based on UOTTA technology, which mainly consists of: (i) vehicle-mounted supervisory control units that monitor the real-time status of an EV's battery packs; (ii) customized VCUs which upload real-time data of the electric vehicle, such as its battery status, real-time location and safety status, to our data platform, using Bluetooth and/or Wi-Fi technologies; (iii) our data management platform, which collects and synchronizes real-time information of the EVs uploaded by their respective VCUs, as well as information on the availability and locations of compatible UOTTA battery-swapping stations that assist drivers in locating the nearest compatible UOTTA battery-swapping station(s) available when the EV's battery is determined to be lower than a certain level; and (iv) UOTTA battery-swapping stations designed for precise positioning, rapid disassembly, compact integration and flexible deployment of battery-swapping for compatible EVs.

We have established in-house capabilities in the innovation of EV battery-swapping technology. Through our research and development efforts, we are developing an intellectual property portfolio. As of the date of this prospectus, we had 51 issued patents and 18 pending patent applications in China. Our research and development team is committed to technology innovation. As of the date of this prospectus, our research and development team consisted of 25 personnel and is led by Mr. Rui Wang and Mr. Zhanduo Hao, each of whom has experience of over 20 years in the electric power sector.

In 2021, leveraging years of automobile industry experience, we started cooperating with major automobile manufactures to jointly develop UOTTA-powered EVs, by adapting selected EV models with our UOTTA technology. We intend to primarily focus on developing commercial-use UOTTA-powered EVs, such as ride-hailing passenger EVs, small logistics EVs, light electric trucks, and heavy electric trucks, and their compatible UOTTA battery-swapping stations. In 2025, we have entered into cooperating agreements with two major Chinese automobile manufacturers, SAIC Maxus Automobile Co., Ltd. and SAIC Hongyan Automobile Co., Ltd., respectively, to jointly develop UOTTA-powered electric trucks. We also have engaged with one battery-swapping station manufacture to jointly develop and manufacture UOTTA battery-swapping stations that are compatible with UOTTA-powered EVs. Our UOTTA battery-swapping stations are designed for precise positioning, rapid disassembly, compact integration and flexible deployment, allowing battery replacement within several minutes. As of the date of this prospectus, we realized sales of thirty-two battery-swapping stations. In order to provide a comprehensive battery power solution based on UOTTA technology, we are in the process of developing a data management platform that connects UOTTA-powered EVs and stations, and assists the UOTTA-powered EV drivers in locating the closest compatible UOTTA swapping-stations on their routes. We believe we have made significant progress in entering into the EV market as of the date of this prospectus, however, there is no assurance that we will be able to execute our business plan to expand into the EV market as we have planned. For the six months ended June 30, 2025, our revenue from the EV business was RMB13.9 million, which constituted 78.4% of our total revenue. For the fiscal years ended December 31, 2022, 2023 and 2024, our revenue from the EV business was RMB3.1 million, RMB17.1 million and RMB41.8 million, which constituted 39.2%, 86.3%, and 94.5%, respectively, of our total revenue.

**Our Competitive Strengths**

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***A vehicle sourcing network in lower-tier cities in China***

We have established a vehicle sourcing network primarily in the lower-tier cities in China, which allows us to distribute vehicles to our customers. We have a deep understanding of the vehicle dealership market and are able to provide services tailored to the changing needs of our consumers. We have built long-term relationships with our suppliers and SME deer customers, who have a strong presence in the lower-tier cities. Through working directly with our suppliers and customers, we are able to better understand and timely address their needs, as well as provide targeted services to them. As of the date of this prospectus, we worked with approximately 100 suppliers and 30 SME dealers in the lower-tier cities in China. We have also established strong working relationships with a number of vehicle wholesalers.

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***UOTTA Battery-swapping technology***

Our UOTTA technology is an intelligent modular battery-swapping technology designed to provide a comprehensive battery power solution for EVs. Through our cooperation with major automobile manufactures, we are in the process of adapting UOTTA technology to electric trucks. We believe our UOTTA technology has the potential of greatly alleviating range-anxiety, which, according to Frost & Sullivan, has been one of the most critical challenges to EV adoption, particularly in the commercial-use EV market. Our UOTTA technology is designed to provide a comprehensive battery power solution that includes UOTTA-powered EVs and battery-swapping stations, as well as a data management platform that synchronizes real-time data.

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***Strong cooperation with key partners, including major automakers and battery developers in China***

We have partnered with major automotive manufacturers to jointly develop the UOTTA-powered EV models. As of the date of this prospectus, key partners of our UOTTA battery power solution include major automobile manufacturers (SAIC Maxus Automobile Co., Ltd. and SAIC Hongyan Automobile Co., Ltd.), and battery developers and manufacturer (Ruipu Energy Co., Ltd.). We expect that their expertise and industry know-how will guide us in our efforts to enter the EV market. We believe we are one of the few companies that are able to develop such relationships with these major manufacturers, due to our industry experience, research and development capabilities, and industry reputation.

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***Visionary and experienced management team with strong commitment***

We are led by a visionary management team with a unique "bottom up" strategy. Our founders and senior management team have in-depth expertise in the automotive and technology industries. The key members of our management team have an average of approximately 20 years of industry experience. Our founder and chairman, Mr. Jia Li, is a well-recognized leader in the Chinese automotive industry. He served as vice president of the finance group in SAIC Motor, one of the largest automobile manufacturers in China, before he founded our Company. Mr. Jia Li's proven track record and extensive experience in the automobile industry provide strong leadership to our mission. Mr. Rui Wang, our senior vice president, has approximately 20-years of industry experience in automobile engineering and design, working at several leading automobile manufacturers, such as FAW Group, Isuzu Auto, Toyota and IAT Auto. Mr. Zhanduo Hao, our senior engineer, is committed to the research of key electric vehicle charging and battery-swapping technologies and has substantial industry experience, having previously participated in the formulation of national and industry standards related to power swapping projects.

**Our Strategies**

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***Jointly Develop UOTTA-powered EVs with major auto manufacturers in China***

As of the date of this prospectus, our UOTTA technology is in the process of being adapted to electric vehicles by cooperating with major auto manufacturers in China. We intend to further explore collaboration opportunities with additional auto manufacturers who have leading technologies and sufficient capacities.

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***Develop and manufacture battery-swapping stations for UOTTA-powered EVs***

As of the date of this prospectus, we have launched two models of UOTTA battery-swapping stations, "Titan" and "Chipbox", by cooperating with battery-swapping station manufacturers in China. In August 2021, we completed the construction of our Zibo Factory, which commenced manufacturing UOTTA battery-swapping stations in January 2022. The Zibo Factory is located in Zibo City, Shandong Province, with approximately 15,430 square meters of production area. In May 2023, we cancelled our plan to build another factory in Wuhu City because our current production demand can be adequately served by our Zibo Factory. In February 2024, we entered into a share exchange agreement to acquire 26.25% equity shares of MATSON (HONG KONG) INDUSTRY CO., LIMITED, which is a Hong Kong limited liability company engaged in the development of EV battery-swapping technology. Our plan is to promote and expand our products into the Hong Kong market, and such acquisition was in furtherance of this goal.

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***Enhance our research and development capabilities***

Technology drives our business. We plan to focus on technology innovations to continue developing and upgrading our proprietary UOTTA technology. We expect to further strengthen the collaboration between our research and development team and marketing team to accumulate and transform insights gained from practical experience into research and development capabilities. In addition, we are determined to strengthen our research and development capabilities by proactively recruiting and retaining engineering talents, in order to expand our talent pool and help us drive technological innovation.

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***Expand sales channels***

In order to promote and market our UOTTA-powered EVs and battery-swapping stations, we plan to (i) leverage our existing sourcing networks to market our new products; and (ii) explore new sales channels by cooperating with new strategic partners who possess their own sales networks, as well as enhancing the capabilities of our in-house sales team by recruiting qualified sales professionals.

**Our Business Model**

● **Sourcing Business** 

For the six months ended June 30, 2025, we generated revenue of RMB2.8 million, constituting 15.9% of our total revenue, from the sourcing business. For the fiscal years ended December 31, 2024, 2023, and 2022, we generated revenue of RMB0.1 million, RMB1.5 million and RMB4.4 million, constituting 0.1%, 7.7%, and 56.8% of our total revenue, respectively, from the sourcing business.

Since our inception, we have primarily engaged in the provision of vehicle sourcing services and developed a sourcing network in the lower-tier cities in China, by building relationships with our sourcing partners, including automobile wholesalers on the supply side and SME dealers and individual customers on the demand side. We charge a commission that is calculated based on the purchase price of each purchase order and the commission is recognized upon delivery of vehicles to customers. For the six months ended June 30, 2025, revenue generated from provision of vehicle sourcing services were RMB2.8 million, constituting 15.9% of our total revenue. For the fiscal years ended December 31, 2024, 2023, and 2022, revenue generated from provision of vehicle sourcing services were RMB0.1 million, RMB1.5 million, RMB1.1 million, constituting 0.1%, 7.4%, and 58.8% of our total revenue, respectively. We aim to continue expanding our sourcing network, in an effort to provide our customers with a means by which they may acquire vehicles at a reasonable price point. As of the date of this prospectus, our sourcing network was comprised of approximately 30 SME dealers and 100 wholesalers.

We generated revenue of RMB2.8 million and RMB3.3 million from one transaction of battery sourcing, which accounted for 15.9% and 42.8% of the total revenue for the six months ended June 30, 2025 and for the fiscal year ended December 31, 2022. No revenue was generated from battery sourcing transactions during the fiscal years ended December 31, 2023 and 2024. While we customarily source whole vehicles that are completed with vehicle bodies and batteries, some of our vehicle sourcing customers demanded to purchase certain EV model vehicle bodies without batteries. The automobile wholesaler who sells this certain EV model, however, only sells the whole EV, including both body and battery. In order to address the needs of these customers, we purchased these EVs from the wholesaler, delivered the EV bodies to the vehicle sourcing customers, and entered into a battery sales agreement with another buyer to sell these batteries separately. As of the date of this prospectus, we only made one transaction of battery sales and plan to provide the service on a case by case basis.

● **EV Business** 

For the six months ended June 30, 2025, we generated revenue of RMB13.9 million, constituting 78.4% of our total revenue, from our EV business. For the fiscal years ended December 31, 2024, 2023 and 2022, we generated revenue of RMB41.8 million, RMB17.1 million and RMB3.1 million, constituting 94.5%, 86.3% and 39.2% of our total revenue, respectively, from our EV business, as the following:

<u>UOTTA-powered EVs</u>: The UOTTA-powered EVs are being jointly developed in cooperation with major automobile manufacturers in China, utilizing our proprietary UOTTA technology that enables efficient battery-swapping for EVs. We intend to primarily focus on commercial-use EVs in the near future. As of the date of the prospectus, we have entered into cooperating agreements with two major auto manufactures to jointly develop UOTTA-powered EVs by adapting commercial-use electric vehicles with UOTTA technology. For the six months ended June 30, 2025 and for the fiscal years ended December 31, 2024, 2023 and 2022, we did not generate any revenue from sales of UOTTA-powered EVs.

<u>UOTTA Battery-swapping Stations</u>: Our UOTTA battery-swapping station currently has two models: (i) the Titan model, which is intended for electric heavy trucks; and (ii) the Chipbox model, which is intended for ride-hailing passenger EVs, light electric trucks, and small logistics vehicles. Both models are developed based on our UOTTA technology. For the six months ended June 30, 2025, we realized sales of one station in Jilin Province and one station in Hongkong. For the fiscal year ended December 31, 2024, we realized sales of twelve stations in Jilin City, Jilin Province, and one station in Songyuan City, Jinlin Province. For the fiscal year ended December 31, 2023, we realized sales of five stations in Quanzhou City, Fujian Province, and one station in Huzhou City, Zhejiang Province. For the fiscal year ended December 31, 2022, we realized sales of one station in Huzhou City, Zhejiang Province and one station in Xuchang City, Henan Province, totally generated 3.8 million in revenue.

<u>Battery-swapping Station Operations</u>: In January 2022, we started operating a battery-swapping station in Quanzhou City, Fujian Province, pursuant to our station cooperation agreement with Quanzhou Xinao, a local gas station operator. In March 2023, we started operating a second battery-swapping station pursuant to the same agreement. For the six months ended June 30, 2025, we generated revenue from battery-swapping services in the amount of RMB1.0 million, which revenue included battery-swapping services fee and the station control system upgrading service, constituting 5.7% of our total revenue. For the fiscal years ended December 31, 2024, 2023 and 2022, we generated revenue from battery-swapping services in the amount of RMB2.4 million, RMB1.2 million, and RMB0.3 million, which revenue included battery-swapping services fee and the station control system upgrading service, constituting 5.4%, 6%, and 3.9% of our total revenue, respectively.

**Our Vehicle Sourcing Business**

We typically source vehicles from wholesalers to fulfill demands for vehicles of our customers, including SME dealers and individual customers primarily located in lower-tier cities in China. We charge a commission that is calculated based on the purchase price of each purchase order and such agent commission is recognized upon delivery of vehicles to customers. Customers are required to make full payment for the total selling price before we deliver the purchased vehicles to them.

We intend to further expand our sourcing network through marketing efforts by our sales team, such as targeted promotions via social media platforms and in-person meetings. We plan to leverage our existing sourcing network to market and promote our UOTTA-powered EVs and battery-swapping stations.

The following table sets forth the gross merchandise volume ("GMV") and car units sourced and delivered to our customers by customer type for the six months ended June 30, 2025 and for the fiscal years ended December 31, 2024, 2023, and 2022. For the six months ended June 30, 2025, we sold cars to our SME customers with lower unit price, which led to lower GMV with the increase numbers of units.

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **For the six months ended <br> June 30** | **For the six months ended <br> June 30** | **For the fiscal year ended<br> December 31** | **For the fiscal year ended<br> December 31** | **For the fiscal year ended<br> December 31** | **For the fiscal year ended<br> December 31** | **For the fiscal year ended<br> December 31** | **For the fiscal year ended<br> December 31** |
|  | **2025** | **2025** | **2024** | **2024** | **2023** | **2023** | **2022** | **2022** |
|  | **GMV** | **Units** | **GMV** | **Units** | **GMV** | **Units** | **GMV** | **Units** |
|  | **(RMB)** | | **(RMB)** | | **(RMB)** | | **(RMB)** | |
| SME dealer customers | 836244 | 81 | 302712 | 215 | 1452684 | 22 | 1121947 | 409 |
| Individual customers |  |  |  |  |  |  | 52009 | 2 |
| **Total** | **836244** | **81** | **302712** | **215** | **1452684** | **22** | **1173956** | **411** |

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While we customarily source whole vehicles completed with vehicle bodies and batteries, some of our vehicle sourcing customers demanded to only purchase certain EV's vehicle bodies without their batteries. The automobile wholesaler, Wuhan Dongjun Automobile Sales Service Co., Ltd., which sells this EV, however, only sells the whole EV, including both the body and battery. In order to address the needs of our vehicle sourcing customers, on May 17, 2022, we entered into a purchase agreement with Wuhan Dongjun Automobile Sales Service Co., Ltd., to purchase a certain number of the whole EVs, but delivered and charged for only the vehicle bodies (without the batteries) to our vehicle sourcing customers. Subsequently, on June 27, 2022, we entered into a sales agreement with Quanzhou Shengyue New Energy Technology Co., Ltd., to sell the batteries separately.

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***Vehicle Sourcing Customers***

We provide sourcing services to SME dealers and individual customers primarily located in lower-tier cities in the PRC. Our relationships with our customers are mainly established through prior business dealings and referrals of our existing customers. For the six months ended June 30, 2025, we had one customer which was a SME dealer. For the fiscal year ended December 31, 2024, we had four customers, among which, four were SME dealers and no individual customers. For the fiscal year ended December 31, 2023, we had two customers, among which, two were SME dealers and no individual customers. For the fiscal year ended December 31, 2022, we had 12 customers, among which, 10 were SME dealers and 2 were individual customers.

Three customers accounted for more than 10% of our total sourcing revenue for the six months ended June 30, 2025.Three customers accounted for more than 10% of our total sourcing revenue for the fiscal year ended December 31, 2024. Four customers accounted for more than 10% of our total sourcing revenue in for the fiscal year ended December 31, 2023. Four customers accounted for more than 10% of our total sourcing revenue for the fiscal year ended December 31, 2022.

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***Vehicle Sourcing Suppliers***

We typically source cars from vehicle wholesalers. Occasionally we also source cars directly from auto manufacturers. For the six months ended June 30, 2025, we sourced cars from two suppliers. For the fiscal years ended December 31, 2024, 2023, and 2022, we sourced cars from nil, two and 10 suppliers, respectively. Three suppliers accounted for more than 10% of our total sourcing amount for each of the fiscal years ended December 31, 2024, 2023, and 2022.

We do not enter into long-term supplier agreements with our sourcing suppliers. The relationships with our suppliers are established through our history of long-term cooperation. The members of our core management team have years of experience in the automotive industry and have established extensive and in-depth contacts with our suppliers.

**Our EV Business**

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***UOTTA-powered EVs***

We are dedicated to the research and development, and promotion and sales of our UOTTA-powered EVs. As of the date of this prospectus, we have entered into cooperating agreements to jointly develop UOTTA-powered EVs with two major automobile manufactures by adapting selected EV models with our UOTTA technology. Depending on the manufacturer, the terms of these agreements are either two or five years. Each UOTTA-powered EV model is designed to meet all safety and technical requirements specified by the safety and operational standards mandated by the Ministry of Industry and Information Technology of the PRC ("MIIT"). Prior to sale to the public, each UOTTA-powered EV model must have been certified by authorities designated by the Accreditation Administration Committee as qualified products and granted certification marks, as well as pass inspections conducted by a state-recognized testing institution, and obtain approvals from the MITT.

Salient terms of the agreements with our cooperating automobile manufacturers in relation to the development, manufacturing and sales of the UOTTA-powered EVs are as follows:

● The automobile manufacturer will select, from its existing product pipeline, car model(s) that are suitable to be transformed into UOTTA-powered EV(s). The automobile manufacturer shall also manufacture, promote and distribute the UOTTA-powered EVs.

● We will provide battery-swapping technology solutions that transform the selected EV model into a UOTTA-powered EV that allows battery-swapping at our UOTTA battery-swapping stations. We shall also promote and distribute the UOTTA-powered EVs.

● We will develop, manufacture, and construct compatible battery-swapping stations for the jointly-developed UOTTA-powered EVs, and provide customer services for users of the UOTTA battery-swapping services at the stations.

● In some cases, we will provide financing plans and solutions to support the joint development, promotion, and sales of the UOTTA-powered EVs and battery-swapping stations.

● We will assist the manufacturer in obtaining MIIT approvals for UOTTA-powered EV models.

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In October 2023, we started to sell two-wheeled UOTTA-powered EVs. We source the vehicles from Wuxi Aide Electric Technology Co., Ltd. We have engaged two dealers, Yuncheng Xinfengfei Trading Co., Ltd. ("Xinfengfei") and Wuhu Huanyu Automobile Co., Ltd., as regional dealers for our EV products. As of the date of this prospectus, we have sold about 215 EVs to Xinfengfei and have generated revenue of nil from this EV business. For the six months ended June 30, 2025, we have sold about 10 EVs to Treep Mobility Group S.A.C. and have generated revenue of RMB103,539 (US$14,454) from this EV business.

***UOTTA Battery-Swapping Stations***

Drivers of UOTTA-powered EVs can replace depleted batteries for ones that are fully charged at compatible UOTTA battery-swapping stations. Currently, due to the yet to be resolved issue of battery standardization, UOTTA battery-swapping stations can only service certain compatible EV models. The Titan model of UOTTA battery-swapping station is designed to service electric heavy trucks, while the Chipbox model is designed to service electric light trucks, logistics vehicles, ride-hailing passenger cars and taxis. For further details, see "Risk Factors — Risks Relating to the Development and Sales of UOTTA-powered EVs and Battery-Swapping Stations — We may encounter difficulty promoting and marketing UOTTA-powered EVs and battery-swapping stations because of the lack of unified industry standards on EV batteries."

The typical size of a Titan station is approximately 6 to 8 parking spaces, or 60 square meters. The typical size of a Chipbox station is approximately 8-10 parking spaces, or 90 square meters. UOTTA battery-swapping stations are capable of automated operations. Once a vehicle is parked in the station and the driver activates the swap function, battery-swapping will take place automatically. Our UOTTA battery-swapping stations are jointly-developed with our cooperating battery-swapping station manufacturers using advanced modular replacement technology, capable of battery-swapping services of compatible EVs within a few minutes.

The base prices of the Titan model range from RMB2,500,000 to RMB3,500,000 per unit, and the base price of the Chipbox model ranges from RMB2,200,000 to RMB3,000,000 per unit. The prices include assembling and installing of the stations, but exclude the construction or infrastructure costs of the physical battery-swapping station. The expected useful-life of the stations is approximately 10 to 15 years. To purchase a UOTTA battery-swapping station, a customer is required to make a non-refundable deposit in the amount of approximately 40% of the full price. The prospective buyers/operators of our battery-swapping stations are the existing oil/gas station owners/operators and transportation business owners such as ride-hailing service providers and logistics companies. In an effort to promote the adoption of our battery-swapping stations, we have generally adopted the following forms of agreement:

●  ***Battery-swapping station operation agreement ("Station Operation Agreement").*** Pursuant to the Station Operation Agreement, the prospective station owners shall purchase one or more battery-swapping stations and install the stations at premises owned or leased by them. For those prospective station owners who operate stations by themselves, we will provide training and supervision on the operation of the stations for a period of not more than two months; for those who choose to entrust us to operate their stations, we will operate the stations for a pre-determined monthly fee for a term of 5 years.

●  ***Battery-swapping station operation agreement ("Station Cooperation Agreement").*** Pursuant to the Station Cooperation Agreements, we shall invest in, build and operate a pre-determined number of battery-swapping stations at locations as selected and prepared by our customers for a pre-determined length of time, generally for 8 years. The customer may elect to purchase the battery-swapping stations at pre-determined prices during this period. In the event that the customer does not exercise its right to purchase the battery-swapping stations, we will continue to own and operate the battery-swapping stations, and shall lease the premises of the battery-swapping stations from the customer at pre-determined rates after 180 days of operation.

●  ***Battery-swapping station sales agreement ("Station Sales Agreement").*** Pursuant to the Station Sales Agreement, we are responsible for supply and delivery of battery-swapping stations to the prospective buyers, who will be responsible for the construction and operation of the battery-swapping stations.

In the six months ended June 30, 2025, we sold and delivered 4 stations to 3 customers, pursuant to the Station Sales Agreements. For the fiscal year ended December 31, 2024, we sold and delivered 12 stations to 2 customers, pursuant to the Station Sales Agreements. For the fiscal year ended December 31, 2023, we sold and delivered six stations to four customers, pursuant to the Station Sales Agreements. For the fiscal year ended December 31, 2022, we sold and delivered two stations to two customers pursuant to the Station Sales Agreements.

As of the date of this prospectus, we entered into one Station Cooperation Agreement with one customer, Quanzhou Xinao, to invest in, build and operate four battery-swapping stations in Quanzhou City, Fujian Province. Pursuant to which agreement, we are currently operating two stations as follows:

&nbsp;&nbsp;&nbsp;&nbsp;(1) In January 2022, we completed the construction of one station and started operating the station. After 180 days of operation, Quanzhou Xinao chose not to purchase the station from us, and subsequently we entered into a lease agreement with Quanzhou Xinao to lease the premises of the battery-swapping station for a period of eight years, from July 16, 2022 to July 15, 2030, during which time we will continue to own and operate this station, unless Quanzhou Xinao exercises its right to purchase the station, from us.

&nbsp;&nbsp;&nbsp;&nbsp;(2) In March 2023, we completed the construction and commenced operation of a second station We entered into a lease agreement with Quanzhou Xinao to lease the premises of the battery-swapping station for a period of eight years, beginning from January 16, 2023, during which time we will continue to own and operate this station, unless Quanzhou Xinao exercises its right to purchase the station, from us.

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***UOTTA Data Management Platform***

As part of a comprehensive battery power solution, our self-developed UOTTA data management platform collects and synchronizes real-time information, including battery power voltage and remaining cruising range of the UOTTA-powered EVs, uploaded by their respective VCUs, as well as information on the availability and locations of compatible UOTTA battery-swapping stations. The UOTTA data management platform then provides information to assist a driver in locating the nearest compatible UOTTA battery-swapping station(s) available when the EV's battery is determined to be lower than a certain level. As of the date of this prospectus, we have substantially completed the development of the main functionalities of the data management platform, and are in the process of developing ancillary programs and applications that assist with the day-to-day operations of the UOTTA battery-swapping stations and user management.

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***Research and Development (R&D)***

As of the date of this prospectus, our engineering research and development headquarters is in Shanghai, where we have a team of 25 research and development personnel. For the six months ended June 30, 2025, our R&D expenses were RMB3.4 million, which accounted for 19.3% of our revenue. For the fiscal years ended December 31, 2024, 2023 and 2022, our R&D expenses were RMB3.0 million, RMB2.2 million and RMB9.4 million, which accounted for 6.7% 11.1% and 120.0% of our revenue, respectively.

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***Vehicle Engineering.*** We have in-house vehicle engineering capabilities which cover all areas of vehicle engineering, starting from concept to completion. Our vehicle engineering group consists of 46 personnel. Our vehicle engineering team is located at our Shanghai headquarters, which location was selected due to its status as a global automotive hub, providing us with valuable exposure to a significant talent pool.

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***Battery-swapping Stations.*** We have in-house battery-swapping station design and engineering capabilities, which cover all areas of battery-swapping station design and engineering starting from layout design to operational platform design. Our battery-swapping station engineering group consists of 45 personnel.

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***Data management platform.*** We have in-house data management platform design and development capabilities, which cover all areas of online vehicle and user management system and power exchange service order management system. Our data management platform development group consists of 14 personnel.

 **

***Servicing and Warranty Terms***

 

***Servicing.*** We provide servicing in relation to the UOTTA-powered battery-swapping stations primarily through our in-house after-sales team, which provides training, repair and maintenance services. We plan to form a service management team, which will be responsible for supervising and management of our after-sales team. Our team will select the location of our service centers primary based on the following criteria: (i) UOTTA-powered EVs and battery-swapping stations density (ii) the number of authorized dealers or service providers of our cooperating auto manufacturers; (iii) labor and operational costs. We established UOTTA authorized service centers in 12 cities in eight provinces as of this prospectus. Servicing in relation to the UOTTA-powered EVs will be primarily provided by our cooperating auto manufacturers through certain authorized dealers or service providers, which provide repair and maintenance services.

 ****

***Limited Warranty Policy.*** For UOTTA battery-swapping stations, we provide a limited one-year warranty, subject to certain conditions. Warranties for parts and components are provided by our suppliers. In addition, after our one-year warranty expires, we will provide life-time maintenance service for UOTTA battery-swapping stations and only charge the owners costs for replacement parts and components. For UOTTA-powered EVs, our cooperation automobile manufactures will provide a limited warranty, subject to certain conditions and requirements of the relevant PRC laws and regulations.

 ****

***Manufacturing, Supply Chain and Quality Control***

We view the manufacturers and suppliers we work with as key partners through our vehicle and battery-swapping station development process. We aim to leverage our partners' industry expertise to ensure that our products meet strict quality standards.

**Manufacturing of Battery-swapping Stations**

As of the date of this prospectus, we have entered into cooperation agreements with four battery-swapping station manufacturers for the joint development and manufacturing of UOTTA battery-swapping stations. The manufacturing process in our own factory is mainly assembly of parts and components procured from our cooperating battery-swapping station manufacturers.

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***Zibo Battery-swapping Station Factory ("Zibo Factory").*** We completed the construction of our Zibo Factory in August 2021 and commenced production of UOTTA battery-swapping stations in January 2022. The Zibo Factory is located in Zibo City, Shandong Province, with approximately 15,430 square meters of production. The lease for the Zibo Factory is 5 years from April 2022. We also lease the equipment at the Zibo Factory. The full production capacity of the Zibo Factory is anticipated to range from 180 to 250 units per year. In May 2023, we cancelled our plan to construct another factory in the Wuhu City, because our current production demand can be well served by our Zibo Factory.

 ****

***Our Battery-swapping Station Suppliers***

Our supply base is located in China, which we believe is beneficial, as it enables us to acquire supplies more quickly and reduces the risk of delays related to shipping and importing of parts and components required for the manufacturing of UOTTA battery-swapping stations. We expect that as our scale increases, such access to our supply base will enable us to take advantage of economies of scale with respect to pricing. We obtain components, parts, manufacturing equipment and other supplies and services from suppliers which we believe to be reputable and reliable. We follow our internal process to source suppliers, taking into account quality, cost and timing.

Our method for sourcing suppliers depends on the nature of the supplies needed. For general parts which are widely available, we seek proposals from multiple suppliers and choose those mainly based on quality and price competitiveness. For parts requiring special designs, we solicit design proposals and choose suppliers largely based on design-related factors. However, in certain cases we have limited choices, given our scale. In such circumstances, we typically partner with suppliers that we believe to be well-positioned to meet our needs.

We do not directly procure raw materials used in the manufacturing of our UOTTA battery-swapping stations; we only procure parts and components from our suppliers. We enter into purchase agreements with key suppliers. The agreements with our suppliers allow us to purchase parts and components on a per purchase order basis. The main parts and components include containers, charging cabinets, station control software and hardware. Furthermore, prices for the parts and components fluctuate, depending on various market conditions and price of the raw materials, such as steel, aluminum, copper, rubber, that are used by our suppliers to manufacture such parts and components. The prices for raw materials are subject to market forces largely beyond our control, including energy costs, market demand, economy trend, and freight costs. See "Risk Factors — Risks Relating to the Development and Sales of UOTTA-powered EVs and Battery-Swapping Stations — We could experience cost increases or disruptions in supply of raw materials or other components used in the manufacturing of battery-swapping stations."

 ****

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***Quality Assurance.***

We aim to deliver high-quality products and services to our customers in line with our core values and commitments. We believe that our quality assurance systems are the key to ensuring the delivery of high-quality products and services. We also seek to minimize waste and to maximize efficiency of our manufacturing process. We emphasize quality management across all business functions, including product development, manufacturing, supplier selection, procurement, servicing and logistics. Our quality management team consists of five members who are responsible for our overall quality strategy, quality systems and processes, and general quality management implementation.

**Competition**

We compete in both the vehicle sourcing and EV battery-swapping markets in the PRC, and competitions in both markets are intense and fast evolving. According to Frost & Sullivan, China's current vehicle sales market is highly concentrated and consists of traditional car companies, internet technology companies, and new energy car companies. Battery-swapping operators can be categorized into EV manufacturers and independent battery-swapping operators. The EV manufacturers mainly serve their own battery-swapping electric vehicle models, while the independent battery-swapping operators offer services to various cooperated EV manufacturers. With the development of battery-swapping technology and the growing battery-swapping infrastructure and supportive government policies, it is expected that more market players will enter the battery-swapping market in the near future.

**Intellectual Property**

We have invested heavily in the areas of battery-swapping solution R&D and developed our proprietary UOTTA technology. As a result, our success depends, in part, on our ability to protect our technology and intellectual property. To accomplish this, we rely on a combination of patents, patent applications, trade secrets, including employee and third-party nondisclosure agreements, copyright laws, trademarks, and other contractual rights to establish and protect our proprietary rights in our intellectual property. As of the date of this prospectus, we had 51 issued patents and 18 pending patent applications, 14 registered trademarks and six pending trademark applications in China, and we also held or otherwise had the legal right to use four registered software copyrights and four registered artwork copyrights. Set forth below is a detailed description of our registered patents:

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Country** | **Patent No.** | **Patent Name** | **Patent<br> Publication<br> Date** | **Patent Type** | **Patent<br> Validity<br> Period** | **Patent<br> Status** |
| PRC | CN202122540404.8 | Floating Lock Nut Device for Electric Vehicle Swappable Battery Pack | 2022-04-12 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121845193.2 | Battery Pack Self-Locking Device for Electric Vehicles | 2022-04-12 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121781707.2 | Rooting Device for Electric Vehicle Battery Pack | 2022-01-28 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121731681.0 | Electric Vehicle Battery Pack Capable of Voltage Switching | 2022-01-28 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121147208.8 | A New Energy Heavy Truck Battery-Swapping Unit | 2022-01-18 | Utility Model Patent | 10 years | Registered |
| PRC | CN201921036843.1 | A Temporary Storefront with Diverse Application Scenarios | 2020-06-09 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121688515.7 | Locking and Unlocking Device of Swappable Battery Pack for Electric Vehicles | 2022-01-11 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121686004.1 | Swappable Battery Pack Locking Device | 2022-01-28 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121686020.0 | Battery Pack Locking Device for Electric Vehicles | 2022-01-11 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121096648.5 | An Unmanned Vehicle Battery-Swapping Unit | 2022-08-30 | Utility Model Patent | 10 years | Registered |

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| PRC | CN202220774766.5 | Battery Pack Swapping Connector | 2022-07-26 | Utility Model Patent | 10 years | Registered |
| PRC | CN202220697269.X | Double Spring-Limited Battery Pack Locking Mechanism for Electric Vehicles | 2022-07-26 | Utility Model Patent | 10 years | Registered |
| PRC | CN202220591673.9 | Battery Pack Rooting Mechanism with Fault Tolerance | 2022-07-26 | Utility Model Patent | 10 years | Registered |
| PRC | CN202121147209.2 | A Spreader for Battery-Swapping of New Energy Vehicles | 2022-01-18 | Utility Model Patent | 10 years | Registered |
| PRC | CN202320055606.X | Battery Box Compartment Rack Assembly for Charging Stations | 2023-04-25 | Utility Model Patent | 10 years | Registered |
| PRC | CN202320136496.X | Battery Box Locking Device for Electric Vehicles | 2023-06-13 | Utility Model Patent | 10 years | Registered |
| PRC | CN202110907285.7 | Flexible Battery Enclosure for Electric Vehicles | 2022-09-30 | Invention Patent | 20 years | Registered |
| PRC<br>| CN202111349980.2 | System for Information Exchange and Battery-swapping between Vehicles and Swap Stations | 2023-06-20 | Invention Patent | 20 years | Registered |
| PRC | CN202222076850.2 | An Unmanned Electric Vehicle Swapping Drone | 2022-11-15 | Utility Model Patent | 10 years | Registered |
| PRC | CN202222101377.9 | An Accurately Positioned Heavy-Duty Electric Vehicle Swapping Station Lifting Device | 2023-04-07 | Utility Model Patent | 10 years | Registered |
| PRC | CN202222130650.0 | A Vehicle-Mounted Battery Pack Base Suitable for Heavy-Duty Trucks | 2022-12-13 | Utility Model Patent | 10 years | Registered |

| PRC | CN202222519831.2 | A Rotatable Heavy-Duty Vehicle Battery-swapping Station Hoist | 2023-01-17 | Utility Model Patent | 10 years | Registered |
| PRC | CN202222650534.1 | An Electric Vehicle Battery-swapping Lock | 2023-01-31 | Utility Model Patent | 10 years | Registered |
| PRC | CN202223083482.0 | Suspension-Type Battery Box Mounting Mechanism | 2023-04-18 | Utility Model Patent | 10 years | Registered |
| PRC | CN202223131182.5 | Quick-Release DC Output Charging Device | 2023-03-28 | Utility Model Patent | 10 years | Registered |
| PRC | CN202223315209.6 | An Exchangeable Battery Pack Exchange Structure | 2023-05-09 | Utility Model Patent | 10 years | Registered |
| PRC | CN202230617507.7 | Quick-Change Battery Pack | 2023-01-10 | Design Patent | 15 years | Registered |
| PRC | CN202320057020.7 | Battery Box Transport Device for Swapping Stations | 2023-05-26 | Utility Model Patent | 10 years | Registered |

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| PRC | CN202320125070.4 | Battery Pack Maintenance and Storage Cabinet | 2023-06-23 | Utility Model Patent | 10 years | Registered |
| PRC | CN202222163173.8 | A Mobile Device for Heavy-Duty Battery-swapping Stations | 2022-11-22 | Utility Model Patent | 10 years | Registered |
| PRC | CN202111348022.3 | System and method for monitoring high-capacity lithium-ion batteries | 2024-03-19 | Invention Patent | 20 years | Registered |
| PRC | CN202330032697.0 | Quick-change battery box | 2023-11-10 | Design Patent | 15 years | Registered |
| PRC | CN202230514295.X | Display screen panel with station control system graphical user interface | 2023-01-17 | Design Patent | 15 years | Registered |
| PRC | CN202230514494.0 | Battery exchange mini-program graphical user interface for display screen panel (Uda battery exchange mini-program) | 2023-01-17 | Design Patent | 15 years | Registered |
| PRC | CN202230514294.5 | Display screen panel with graphical user interface for software (Uda battery exchange operation management platform SaaS system) | 2023-01-13 | Design Patent | 15 years | Registered |
| PRC | CN202230346944.X | Station-cloud communication device | 2023-01-10 | Design Patent | 15 years | Registered |
| PRC | CN202230514504.0 | Display screen panel with graphical user interface (Uda battery exchange operation management platform) | 2023-01-10 | Design Patent | 15 years | Registered |
| PRC | CN202221780227.9 | On-board battery exchange device | 2022-11-15 | Utility Model Patent | 10 years | Registered |
| PRC | ZL202420037870.5 | A battery locking and unlocking RGV (Rail-Guided Vehicle) | 2024-02-06 | Invention Patent | 20 years | Registered |
| PRC | ZL202323085598.2 | An intelligent battery-swapping station | 2024-01-09 | Invention Patent | 20 year | Registered |
| PRC | ZL202420037902.1 | A battery handling stacker | 2024-02-06 | Invention Patent | 20 year | Registered |
| PRC | ZL202110835764.2 | A fixing and quick-installation mechanism for battery swap boxes | 2024-05-24 | Invention Patent | 20 year | Registered |
| PRC | ZL202110835790.5 | A fixing mechanism for electric vehicle battery boxes | 2024-05-24 | Invention Patent | 20 year | Registered |
| PRC | ZL202110858600.1 | A battery box system and output voltage switching method that can switch between multiple voltage levels | 2024-05-24 | Invention Patent | 20 year | Registered |
| PRC | ZL202110881386.1 | A fastening device for quickly securing battery boxes | 2024-05-24 | Invention Patent | 20 year | Registered |

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| PRC | CN202110907741.8 | Locking device for battery box for battery-swapping | 2024-05-24 | Invention Paten | 20 year | Registered |
| PRC | CN202420720847 | Electric vehicle chassis battery-swapping system based on vehicle-mounted rails | 2025-03-14 | Utility Model Patent | 10 years | Registered |
| PRC | CN202422924992.9 | An automatic ramp structure for a charging station | 2025-10-03 | Utility Model Patent | 10 years | Registered |
| PRC | CN202423016802.X | An apparatus for the maintenance and installation of large-weight battery boxes | 2025-09-30 | Utility Model Patent | 10 years | Registered |
| PRC | CN202520033896.7 | A hoisting mechanism for charging stations | 2025-12-23 | Utility Model Patent | 10 years | Registered |

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**Employees**

We had 86, 80, 77, and 105 full-time employees for the six months ended June 30, 2025 and for the fiscal years ended December 31, 2024, 2023, and 2022, respectively. The following table sets forth the numbers of our employees categorized by function as of the date of this prospectus:

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| | |
|:---|:---|
| **Function** | **As of<br> the date of this <br> prospectus** |
| Executives | 6 |
| Research and Development | 25 |
| Sales and marketing | 6 |
| Operation and Administrative | 31 |
| Manufacturing | 18 |
| **Total number of employees** | 86 |

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We enter into employment contracts with our full-time employees. As required by regulations in China, our Chinese subsidiaries participate in various employee social security plans that are organized by municipal and provincial governments for our PRC-based full-time employees, including pension, unemployment insurance, childbirth insurance, work-related injury insurance, medical insurance and housing insurance. Our PRC subsidiaries are required under PRC law to make contributions from time to time to employee benefit plans for full-time employees at specified percentages of the salaries, bonuses and certain allowances of such employees, up to a maximum amount specified by the local governments in China.

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

**Facilities**

As of the date of this prospectus, we lease all of our facilities. The following table sets forth the location, approximate size, primary use and lease term of our major leased facilities:

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| | | | | |
|:---|:---|:---|:---|:---|
| **Location** | **Approximate<br> Gross Floor Area<br> in Square Meters** | **Primary Use** | **Lease or Own** | **Lease<br> Expiration Date** |
| Anhui, China | 357 | Global headquarters | Lease | 1/31/2027 |
| Shanghai, China | 752 | Office | Lease | 11/15/2026 |
| Henan, China | 680 | Office | Lease | 7/31/2026 |
| Zibo, China | 15430 | Factory | Lease | 3/31/2027 |

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In December 2021, Youpin SD., Youxu New Energy Technology (Zibo) Co., Ltd. (a wholly owned subsidiary of Youpin SD.), Mr. Jia Li, and Shandong Qiying Industrial Investment Development Co., Ltd. ("Shandong Qiying") entered into a Capital Increase Agreement (the "Capital Increase Agreement"). Pursuant to the Capital Increase Agreement, in exchange for the total rental fees in the amount of RMB15,670,840 from April 1, 2022 to March 31, 2027, for both the factory and equipment of the Zibo Factory, Shandong Qiying shall receive 15% of the equity shares of Youxu New Energy Technology (Zibo) Co., Ltd. Furthermore, Youxu New Energy Technology (Zibo) Co., Ltd. and Shandong Qiying entered into a lease agreement on December 28, 2021 (the "Zibo Factory Lease Agreement"), pursuant to the Capital Increase Agreement. In November 2023, the parties entered into an amendment to the Capital Increase Agreement (the "Amendment") and agreed that Shandong Qiying shall receive 16.11% of the equity shares of Youxu New Energy Technology (Zibo) Co., Ltd in exchange for the rental fees.

**Insurance**

We maintain certain types of insurance to safeguard against risks and unexpected events. For example, we provide social security insurance, including pension insurance, unemployment insurance, work-related injury insurance and medical insurance for employees. We also maintain employer liability insurance. We are not required to maintain business interruption insurance or product liability insurance in China under PRC laws and do not maintain key person insurance, insurance policies covering damages to network infrastructures or information technology systems, nor any insurance policies for properties. For the six months ended June 30, 2025 and for the fiscal years ended December 31, 2024, 2023, and 2022, we did not file any material insurance claims in relation to our businesses.

**Seasonality**

The automobile industry in China is subject to seasonal variations in revenue. Demand for automobiles is generally higher before or during certain major Chinese holidays, such as the Lunar New Year in January/February, the Labor Day holidays in May and the National Day holidays in October. Accordingly, we expect our revenue and operating results generally to be higher in these periods than in other months of the year.

**Legal Proceedings**

From time to time, we may be involved in legal proceedings in the ordinary course of our business. Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial costs and diversion of our resources, including our management's time and attention.

Youpin SD sued one of its vehicle sourcing service providers Inner Mongolia Zhonglutong Trading Co., Ltd. for failing to deliver vehicles as scheduled to Youpin SD's customer. Youpin SD won the case on September 8, 2022. On March 23, 2023, both parties entered into a settlement agreement, and the supplier agreed to return the deposit and liquidated damages with a total of RMB2,746,000 (US$376,000). As of the date of this prospectus, Youpin SD has applied for compulsory enforcement and the remaining unpaid amount was RMB2,609 (US$357).

Youpin sued Hainan Gaozhan New Energy Vehicle Company Limited for its failure to refund a deposit of RMB170,000 (US$23,000) and payment of overdue interest to Youpin in November 2023. On April 10, 2024, Youpin won the trial. As of the date of this prospectus, Youpin has applied for compulsory enforcement and the remaining unpaid amount was RMB201,428 (US$28,804).

Youguan Financial Leasing (China) Co., Ltd. sued Sichuan Maichebang Automobile Sales Co., Ltd., Yuan Mingqin, and Yuan Jinsong for rent and liquidated damages of a total of RMB1,949,000 (US278,703) on January 9, 2024. On April 8, 2025, the court appointed an independent valuation firm to assess the disputed vehicles' market value under judicial supervision. As of the date of this prospectus, the case is under trial before the court.

Quanzhou Youyi Power Exchange Network Technology Co., Ltd., Youpin SD and SH Youxu were sued by Quanzhou Meibiaoyouxin Automobile Sales Service Co., Ltd. for payment of RMB700,000 (US$95,890) and liquidated damages on January 16, 2024. The initial hearing was held on March 22, 2024. Youpin SD lost the case and appealed to the court on July 25, 2024. On November 8, 2024, the Quanzhou Intermediate People's Court has revoked the original judgment and remanded the case for retrial. A retrial hearing of second instance was held on January 9, 2026, and the judgment is currently pending.

AHYS, Shanghai Youcang Business Consulting Partnership (Limited Partnership), and Li Jia were sued by Zhuji Huarui Wenhua Equity Investment Partnership (Limited Partnership), Zhuji Huarui Torch Venture Capital Investment Partnership (Limited Partnership), and Zhuji Fuhui Industrial Transformation and Upgrading Investment Fund Partnership (Limited Partnership). The plaintiffs requested the court to order the defendants to jointly pay the investment exit amount of RMB10,000,000 (US$1,429,981), along with overdue payment penalties (calculated based on RMB10,000 (US$1,430) at the prevailing one-year loan prime rate of banks, from January 1, 2024, to the actual payment date, and the litigation costs. On October 24, 2025, the court of first instance ruled in favor of the plaintiffs. On January 6, 2026, the court of second instance upheld the judgment rendered by the court of first instance.

The Wuhu High-Tech Industrial Development Zone Administrative Committee has issued an administrative decision to Youpin on August 29, 2024, which requires Youpin to return a rental subsidy of RMB3,000,000 (US$428,994). Youpin has applied for administrative reconsideration and subsequently filed a lawsuit. Both the administrative reconsideration and administrative litigation proceedings upheld the administrative decision. As of the date of this prospectus, Youpin has not returned the RMB3,000,000 rental subsidy.

Zibo Hengsong You Car Equity Investment Fund Partnership (Limited Partnership) ("Zibo Hengsong") has sued Youpin SD, AHYS, WFOE, and Mr. Jia Li. The plaintiff requested the defendants to repurchase the 13.0435% equity interest in Youpin SD and jointly pay the equity repurchase price of RMB240,000,000 (US$34,319,544) plus interest (temporarily calculated at RMB78,220,273 (US$11,185,350)). The defendants filed a counterclaim demanding that the plaintiff transfer the 13.0435% equity interest in Youpin SD to the defendants at a consideration of RMB1. On December 22, 2025, the Zibo Intermediate People's Court rendered a judgment, ordering AHYS and Mr. Jia Li to jointly pay Zibo Hengsong equity repurchase proceeds of RMB312,374,229.66 (US$44,677,747) plus interest accruing from January 11, 2025 to the date of actual payment (calculated on a principal amount of RMB240,000,000 at an annual interest rate of 8%); ordering Youpin SD to bear joint and several liability for such payment obligations; ordering WFOE to bear joint and several liability for AHYS's payment obligations; and dismissing the defendants' counterclaim in its entirety. In connection with the foregoing proceedings, the Zibo Intermediate People's Court has frozen certain equity interests held by AHYS, Mr. Jia Li, and certain related entities, including, among others, AHYS's equity interests in Youpin Automobile Service Group Co., Ltd. and Shanghai Youxu New Energy Technology Co., Ltd., Mr. Jia Li's equity interests in Shanghai Youyi Jia New Energy Technology Partnership (Limited Partnership) and Shanghai Youcang Business Consulting Partnership (Limited Partnership), and equity interests held by AHYS and certain related entities in certain of our PRC subsidiaries, including Youpin, Youpin SD, SH Youteng, SH Youxu, and CD Youyineng, with the frozen equity interests ranging in value from approximately RMB103,548 to RMB100,000,000 per interest, and the freezing orders remaining in effect through February or March 2028. On January 8, 2026, Youpin SD, AHYS, Mr. Jia Li, and WFOE filed an appeal with the Shandong High People's Court, requesting that the first instance judgment be reversed and that all of Zibo Hengsong's claims be dismissed. As of the date of this prospectus, the case is under trial before the court of second instance.

SH Youxu, AHYS, and WFOE were sued by Nanyang Chengtou Holding Co., Ltd. for payment of RMB5,000,000 (US$714,991) for the equity repurchase price plus interest. SH Youxu filed a counterclaim demanding that the plaintiff transfer an outstanding capital contribution of RMB5,000,000 (US$714,991). The court rendered a judgment on September 5, 2025, dismissing the plaintiff's claims.

SH Youxu and Youxu New Energy Technology (Nanyang) Co., Ltd. were sued by Shanghai Jiehuan Intelligent Technology Co., Ltd. for joint payment of RMB5,800,000 (US$828,389) of the debt. The Company was added as a third party by the Shanghai Songjiang District People's Court on August 12, 2025. As of the date of this prospectus, the case is under trial before the court.

**MANAGEMENT** 

The following table sets forth information regarding our directors and executive officers as of the date of this prospectus.

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| | | |
|:---|:---|:---|
| **Directors and Executive Officers** | **Age** | **Position/Title** |
| Jia Li | 52 | Chief Executive Officer, Director, and Chairman of the Board of Directors |
| Bingyi Zhao | 43 | Chief Financial Officer and Director |
| Xiaochun Li | 51 | Independent Director |
| Quanshi Chen | 80 | Independent Director |
| Jean Christophe von Pfetten | 58 | Independent Director |

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The following is a brief biography of each of the executive officers and directors listed above:

*Mr. Jia Li* has served as the chairman of the board of directors and chief executive officer of the Company since June 2021. Mr. Li founded our operative subsidiary, Youpin Automobile Service Group Co., Ltd., in July 2013, and has served as executive director of Youpin Automobile Service Group Co., Ltd. since May 28, 2014. He has over 20 years of business experience in sales and marketing, and over 15 years in management in the automotive industry and the financial industry. From January 2011 to November 2013, Mr. Li was the vice president at SAIC-GMAC Automotive Finance Co., Ltd. From October 2009 to December 2010, Mr. Li served as the vice president of Siemens Ltd., China, of its SIS North East Asia Financial Leasing services. From February 2009 to April 2009, Mr. Li worked at Hewlett-Packard Financial Leasing Co., Ltd. in China. From August 1999 to January 2009. Mr. Li holds a Master of Engineering degree in Computer Information Processing from Chinese Academy of Sciences, an Executive Master of Business Administration degree from Maastricht School of Management, and a Master of Finance from Renmin University of China.

 

*Ms. Bingyi Zhao* has served as the chief financial officer and a director of the Company since February 2022. Ms. Zhao has over 10 years of experience in the financial sector. She has served as the chief executive officer of our operative subsidiary, Youpin Automobile Service Group Co., Ltd., since July 2018. From November 2015 to April 2018, Ms. Zhao was the President of Investment Fund Division at Shanghai Huayue Equity Investment Management Co., Ltd, whose LP is a listed company in Hong Kong. From 2012 to 2014, she served as the general manager at Shanghai Kaihong Petroleum Holding Group, a member of the Shanghai Petroleum and Natural Gas Trading Center. From 2011 to 2012, Ms. Zhao was a senior consultant at the Plain Law Firm. From December 2008 to June 2010, Ms. Zhao worked at HSBC Bank (China) Company Limited. From April 2007 to October 2008, Ms. Zhao worked at Citigroup Data Processing (Shanghai) Co., Ltd. Ms. Zhao obtained her Bachelor's degree in Finance from East China University of Political Science and Law in 2004.

 

*Ms. Xiaochun Li* is an independent director. Ms. Li has over 20 years of experience in treasury management at international enterprises. Since October 2020, Ms. Li has served as the director of Business Treasury at Nouryon Chemicals B.V., a global specialty chemicals company. From January 2007 to October 2007, Ms. Li served as the China regional Treasurer of Nokia Siemens Networks. From October 2003 to November 2006, Ms. Li was financial treasury manager at Siemens Financial Services Ltd. From May 2000 to September 2003, Ms. Li worked as a senior treasury analyst at Hewlett-Packard Enterprise (China) Co., Ltd. Ms. Li holds a Bachelor's degree in Accounting and Auditing from Shanghai University of Finance and Economics, and earned a Master's degree in Business Administration at a program offered jointly by Shanghai Fudan University and BI Norwegian Business School.

*Mr. Quanshi Chen* is an independent director. Mr. Chen served as a professor and PhD tutor at the College of Vehicles and Mobility, Tsinghua University from March 1970 to September 2010, and the honorary director of the Electric Vehicle Branch of the Chinese Academy of Automotive Engineers since May, 1997. Mr. Chen obtained his Bachelor's degree in automotive engineering at Tsinghua University in March 1970, and served at the Department of Automotive Engineering from 1970 to 2010 in multiple roles, including the department chairperson from October 1994 to December 1997, the deputy director of the Automobile Research Institute at Tsinghua University from January 1998 to January 2004, and the vice dean of the School of Mechanical Engineering from July 1996 to September 2001. Mr. Chen also has served as the director of the Electric Vehicle Branch of Chinese Society of Automotive Engineers from 1998 to October 2018, and the deputy director of Electric Vehicle Branch, Chinese National Automobile Standardization Technical Committee from October 1997 to December 2014. Mr. Chen served as the deputy director of the State Key Laboratory of Automobile Safety and Energy Conservation from July 2001 to December 2006. He has been serving as a consultant for the Chinese National Automobile Standardization Technical Committee, Electric Vehicles Technology Sub-Committee since January 2015. His research focuses on the technological developments of electric vehicles, hybrid vehicles, and fuel cell vehicles. He has published over 30 papers in major national and international journals and conferences. Currently, Mr. Chen also serves as an independent director at Chongqing Changan Automobile Co., Ltd., a company listed on the main board of Shenzhen Stock Exchange, and Shenzhen Daotong Technology Co., Ltd., a company listed on the Science and Technology Innovation Board of the Shanghai Stock Exchange.

 

*Mr. Jean Christophe von Pfetten (Prof. Pfetten)* is an independent director. Prof. Pfetten is an accomplished diplomat and academic, who has served as Chairman of the Institute for East-West Strategic Studies since October 1997, visiting professor at People's University of China since September 1999, Chairman of Thornehope Limited (HK) since September 2001, and Bye-fellow of Emmanuel College (Cambridge University) since May 2015. He also served as a member of the board of the International Financial Bank (FinInt Italy) for three years from January 2019 to December 2022. Prof. Pfetten is the author of a book entitled "Insights from China: Leadership, Policy and New World Order" published in 2015, and more than thirty articles on Corporate Governance, Political Economics and International relations. He received a Bachelor of Science and a Master of Science (Physics and Chemistry) from the University of Strasbourg in 1988 and 1989, respectively, and a Dipl. Eng. in Geophysics from the Institut de Physique du Globe in 1990.

**Family Relationships**

None of our directors or executive officers has a family relationship as defined in Item 401 of Regulation S-K.

**Board of Directors**

Our board of directors consists of five directors. Our board of directors has determined that our three independent directors, Xiaochun Li, Quanshi Chen, and Jean Christophe von Pfetten, satisfy the "independence" requirements of the Nasdaq corporate governance rules.

Pursuant to our third amended and restated memorandum and articles of association, the minimum number of directors shall consist of not less than three directors. All directors shall hold office until the expiration of their respective terms of office and until their successors shall have been appointed and qualified.

**Duties of Directors**

Under Cayman Islands law, our directors owe fiduciary duties to our company, including a duty of loyalty, a duty to act honestly, and a duty to act in good faith in what they consider to be in our best interests. Our directors must also exercise their powers only for a proper purpose. Our directors also have a duty to exercise the skills they actually possess and such care and diligence that a reasonably prudent person would exercise in comparable circumstances. It was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than what may reasonably be expected from a person of his knowledge and experience. However, English and Commonwealth courts have moved towards an objective standard with regard to the required skill and care, and these authorities are likely to be followed in the Cayman Islands.

Although under Cayman Islands law, a controlling shareholder of a Cayman Islands company does not owe fiduciary duties to the company or its minority shareholders, a controlling shareholder who serves as a director of a company owes fiduciary duties in his capacity as a director to such company, for as long as he or she serves on the company's board of directors. Certain shareholders of our controlling shareholder serve on our board of directors and, as a result, owe the aforementioned fiduciary duties to us.

In fulfilling their duty of care to us, our directors must ensure compliance with our memorandum and articles of association as may be amended and restated from time to time. Our company has a right to seek damages against any director who breaches a duty owed to us. A shareholder may in certain circumstances have rights to damages if a duty owed by the 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 general meetings and reporting its work to shareholders at such meetings;

● declaring dividends and distributions;

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

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

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

**Terms of Directors and Executive Officers**

Our officers are elected by and serve at the discretion of the board of directors. Our directors are not subject to a term of office and hold office until their resignation, death or incapacity, or until their respective successors have been elected and qualified or until his or her office is otherwise vacated in accordance with our second amended and restated articles of association.

A director will also be removed from office automatically if, among other things, the director (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 resolved that his office be vacated, or (v) is removed from office pursuant to any other provisions of our third amended and restated memorandum and articles of association.

**Employment Agreements and Indemnification Agreements**

We have entered into employment agreements with our executive officers. Each of our executive officers is employed for a continuous term unless either we or the executive officer gives prior notice to terminate such employment, or for a specified time period, or for a specified time period which will be renewed automatically unless a notice of non-renewal is given. We may terminate an executive officer's employment for cause, at any time, without notice or remuneration, including but not limited to as a result of the executive officer's commitments of any serious or persistent breach or non-observance of the terms and conditions of the employment, conviction of a criminal offence, fraud or dishonesty, habitual neglect of his or her duties, material misconduct being inconsistent with the due and faithful discharge of the executive officer's material duties or material breach of internal procedures or regulations which causes damage to the Company. An executive officer may terminate his or her employment at any time with one month's prior written notice.

We have entered into indemnification agreements with each of our directors and executive officers. Under these agreements, we agree to indemnify our directors and executive officers against all liabilities and expenses incurred by such persons in connection with claims made by reason of their being a director or officer of our company to the fullest extent permitted by law with certain limited exceptions.

**Compensation of Directors and Executive Officers**

For the fiscal year ended December 31, 2025, we paid an aggregate of approximately RMB0.95 million in cash to our executive officers and directors and we did not pay any compensation to our non-executive directors. We have not set aside or accrued any amount to provide pension, retirement or other similar benefits to our directors and executive officers.

Our PRC subsidiaries are required by law to make contributions equal to certain percentages of each employee's salary for his or her medical insurance, maternity insurance, workplace injury insurance, unemployment insurance, pension benefits through a PRC government-mandated multi-employer defined contribution plan and other statutory benefits.

**Committees of the Board of Directors**

We have established three committees under the board of directors: an audit committee, a compensation committee, and a nominating and corporate governance committee. 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 Xiaochun Li, Quanshi Chen, and Jean Christophe von Pfetten. Xiaochun Li is the chairperson of the audit committee. Mr. Jean Christophe von Pfetten qualifies as an audit committee financial expert.

The audit committee oversees our accounting and financial reporting processes and the audits of our financial statements. The audit committee is responsible for, among other things:

● selecting our independent registered public accounting firm and pre-approving all auditing and non-auditing services performed by our independent registered public accounting firm;

● reviewing with the independent registered public accounting firm any audit problems or difficulties and management's response;

● reviewing and approving all proposed related-party transactions, as defined in Item 404 of Regulation S-K under the Securities Act;

● discussing the annual audited financial statements with management and our independent registered public accounting firm;

● annually reviewing and reassessing the adequacy of our audit committee charter;

● meeting separately and periodically with management and our independent registered public accounting firms;

● reporting regularly to the full board of directors; and

● performing such other matters that are specifically delegated to our audit committee by our board of directors from time to time.

 ****

***Compensation Committee***

Our compensation committee consists of Xiaochun Li, Quanshi Chen, and Jean Christophe von Pfetten. Xiaochun Li is the chairperson of the compensation committee.

The compensation committee assists the board in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers. Our chief executive officer may not be present at any committee meeting during which his compensation is deliberated.

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 board for determination with respect to the compensation of our non-employee directors; and

● reviewing and making recommendations to the board of directors with respect to the compensation of our directors.

***Nominating and Corporate Governance Committee***

 ****

Our nominating and corporate governance committee consists of Xiaochun Li, Quanshi Chen, and Jean Christophe von Pfetten. Xiaochun Li is the chairperson of the nominating and corporate governance committee.

The nominating and corporate governance committee will assist the board of directors in selecting directors and in determining the composition of our board and board committees. The nominating and corporate governance committee will be responsible for, among other things:

● identifying and recommending nominees for election or re-election to our board of directors, or for appointment to fill any vacancy;

● reviewing annually with our board of directors its composition in light of the characteristics of independence, age, skills, experience and availability of service to us;

● identifying and recommending to our board the directors to serve as members of committees;

● advising the board periodically with respect to developments in the law and practice of corporate governance as well as our compliance with applicable laws and regulations;

● making recommendations to our board of directors on corporate governance matters and on any corrective action to be taken; and

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

**Code of Business Conduct and Ethics**

Our board of directors has adopted a code of business conduct and ethics, which is applicable to all of our directors, officers and employees. We have made our code of business conduct and ethics publicly available on our website at https://ir.upincar.com/corporate.html.

**CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS** 

Major related parties that transacted with the Group and their respective relationship to the Group are listed as below:

---

| | |
|:---|:---|
| **Names of the related parties** | **Relationship with the Group** |
| Hangzhou Youyue Travel Technology Co., Ltd. ("Hangzhou Youyue") | An affiliate of Bingyi Zhao |
| Shanghai Youzhang Commerical Information Consulting Partnership (Limited Partnership) ("Shanghai Youzhang") | An affiliate of Jia Li |
| Ningbo Youheng Automobile Service Co., Ltd. ("Ningbo Youheng Automobile" | An affiliate of Jia Li |
| Zhejiang Youxiaodian Automobile Service Co., Ltd. ("Zhejiang Youxiaodian") | An affiliate of Jia Li |
| Qingshan Wei | Controlling shareholder of U Power Limited |
| Youjia Technology (Shanghai) Co., Ltd. ("Youjia Technology") | An affiliate of Jia Li |
| Shanghai Youpinsuoer New Energy Technology Co., Ltd. ("Shanghai Youpinsuoer") | An affiliate of Jia Li |
| Jia Li | Controlling shareholder, Director and CEO of U Power Limited |
| Bingyi Zhao | Director and Chief Financial Officer of U Power Limited |
| Shandong Youyidian Automobile Technology Co., Ltd. ("Shandong Youyidian") | An affiliate of Jia Li |
| Youche Jingpin E-commerce (Shanghai) Co., Ltd. ("Youche Jingpin") | An affiliate of Jia Li |
| Shanghai Youcang Business Consulting Partnership (Limited Partnership) ("Shanghai Youcang") | An affiliate of Jia Li |
| Nanmu (Shanghai) Financial Leasing Co., Ltd. ("Nanmu") | An affiliate of Jia Li |
| UNEX EV B.V. | An equity method investee of Energy U Limited |
| Ke Li | Director of U Power Limited |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a) Amounts due from related parties**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **As of December 31, <br> 2022** | **As of December 31, <br> 2023** | **As of December 31, <br> 2024** | **As of <br> June 30, <br> 2025** | **As of the date <br> of this <br> prospectus** |
|  | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** |
| Nanmu (Shanghai) Financial Leasing Co., Ltd.<sup>(1)</sup> |  |  | 20001000 | 40001523 | 39584423 |
| Jia Li<sup>(2)</sup> |  |  | 582701 | 4331256 | 4279232 |
| Ke Li<sup>(2)</sup> |  |  | 437958 | 320000 | 1164704 |
| Youche Jingpin<sup>(3)</sup> | 20200 | 20200 |  |  |  |
| Shanghai Youcang<sup>(4)</sup> | 100000 | 110500 | 100000 |  |  |
| Bingyi Zhao<sup>(5)</sup> | - | 11516 | 535510 | 412478 | 471043 |
|  | **120200** | **142216** | **21657170** | **45065257** | **45499402** |

---

(1) Amounts due from Nanmu (Shanghai) Financial Leasing Co., Ltd. represent a loan from Nanmu (Shanghai) Financial
Leasing Co., Ltd. to Youpin for Youpin's system development, business operations, and market expansion, which is interest-free and
due on May 31, 2027.

(2) Amounts due from Jia Li and Ke Li represent the loans paid to Jia Li and Ke Li by Youpin Shandong, SH
Youxu and Energy U Limited for their market expansion efforts, at an interest rate of 12.4% and with a due date of June 30, 2026.

(3) Amounts due from Youche Jingpin represent Youpin's receivables of rental and corporate service fees
due from Youche Jingpin incurred in November 2017 and February 2018.

(4) Amounts due from Shanghai Youcang represent the advances paid by AHYS to Shanghai Youcang regarding the
transfer of 24.11% equity interests of Youpin in May 2022.

(5) Amounts due from Bingyi Zhao represent the advances paid by Youpin Shandong to Bingyi Zhao for her market
expansion efforts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b) Amounts due to related parties**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **As of December 31, <br> 2022** | **As of December 31, <br> 2023** | **As of December 31, <br> 2024** | **As of <br> June 30,<br> 2025** | **As of the date<br> of this<br> prospectus** |
|  | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** |
| Ke Li<sup>(1)</sup> |  | 4170000 | 3019704 | 19704 |  |
| Jia Li<sup>(1)</sup> | 228420 | 582192 |  | 924104 |  |
| Bingyi Zhao<sup>(1)</sup> | 22602 | 673071 | 218979 | 214908 |  |
| UNEX EV<sup>(2)</sup> |  |  |  | 1361084 | 1054320 |
| Hangzhou Youyue<sup>(3)</sup> | - | 5502 | - | - | - |
|  | **251022** | **5430765** | **3238683** | **2519801** | **1054320** |

---

(1) Amounts due to Ke Li, Jia Li, and Bingyi Zhao represent the interest-free loans to SH Youxu, Energy U
Limited, and U Power Limited for their operation purposes.

(2) Amounts due to UNEX EV represent the loans to Energy U Limited for its operation purpose.

(3) Amounts due to Hangzhou Youyue represent the labor costs paid by Hangzhou Youyu on behalf of Liaoning
Youguan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c) Related party's transaction**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the fiscal year ended <br> December 31,** | **For the fiscal year ended <br> December 31,** | **For the fiscal year ended <br> December 31,** | | |
|  | **2022** | **2023** | **2024** | **For the <br> six months <br> ended <br> June, 30**<br> **2025** | **For the<br> fiscal year <br> ended<br> December 31,**<br> **2025** |
|  | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** |
| Loans to Nanmu (Shanghai) Financial Leasing Co., Ltd |  |  | 20001000 | 20000523 | 19583423 |
| Loans to Jia Li |  |  | 582701 | 3748555 | 3696531 |
| Loans/ (Repayment of loans) to Ke Li |  |  | 437958 | (117958) | 726746 |
| Loans/ (Repayment of loans) to Shanghai Youcang | 85131 | 10500 | (10500) | (100000) | (100000) |
| Loans/ (Repayment of loans) to Bingyi Zhao |  | 11516 | 523994 | (123033) | (64468) |
| Repayment of receivables to Youche Jingpin |  |  | (20200) |  |  |
| Loans/ (Repayment of loans) from Ke Li |  | 4170000 |  | (3000000) |  |
| Loans/ (Repayment of loans) from Jia Li | 228420 | 353772 | (582192) | 924104 |  |
| Loans / (Repayment of loans) from Bingyi Zhao | 22602 | 650469 | (454092) | (4071) | (218979) |
| Loans from UNEX EV |  |  |  | 1361084 | 1054320 |
| Loans / (Repayment of loans)from Hangzhou Youyue |  | 5502 | (5502) |  |  |

---

**SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT** 

The following table sets forth information with respect to the beneficial ownership, within the meaning of Rule 13d-3 under the Exchange Act, of our Ordinary Shares as of the date of this prospectus for:

● each of our directors and executive officers who beneficially own our Ordinary Shares;

● our directors and executive officers as a group; and

● each person known to us to own beneficially more than 5% of our Ordinary Shares.

Beneficial ownership includes voting or investment power with respect to the securities. Except as indicated below, and subject to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all Ordinary Shares shown as beneficially owned by them. Percentage of beneficial ownership of each listed person prior to this offering is based on 4,603,440 Class A Ordinary Shares and 368,044 Class B Ordinary Shares outstanding as of the date of this prospectus, and percentage of ownership of each listed person after this offering is based on 13,694,349 Class A Ordinary Shares and 368,044 Class B Ordinary Shares expected to be outstanding after this offering, assuming (i) no sale of any Units containing a Pre-funded Warrant in this offering, (ii) no exercise of the Warrants, and (iii) no exercise of the over-allotment option.

Information with respect to beneficial ownership has been furnished by each director, officer, or beneficial owner of 5% or more of our Ordinary Shares. Beneficial ownership is determined in accordance with the rules of the SEC and generally requires that such person have voting or investment power with respect to securities. In computing the number of shares beneficially owned by a person listed below and the percentage ownership of such person, shares underlying options, warrants, or convertible securities held by each such person that are exercisable or convertible within 60 days of the date of this prospectus are deemed outstanding, but are not deemed outstanding for computing the percentage ownership of any other person. Except as otherwise indicated in the footnotes to this table, or as required by applicable community property laws, all persons listed have sole voting and investment power for all shares shown as beneficially owned by them.

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Class A<br> Ordinary<br> Shares<br> Beneficially<br> Owned Prior to<br> this Offering\*** | **Class A<br> Ordinary<br> Shares<br> Beneficially<br> Owned Prior to<br> this Offering\*** | **Class B<br> Ordinary<br> Shares<br> Beneficially<br> Owned Prior to<br> this Offering** | **Class B<br> Ordinary<br> Shares<br> Beneficially<br> Owned Prior to<br> this Offering** | **Class A<br> Ordinary<br> Shares<br> Beneficially<br> Owned After<br> this Offering\*** | **Class A<br> Ordinary<br> Shares<br> Beneficially<br> Owned After<br> this Offering\*** | **Class B<br> Ordinary<br> Shares<br> Beneficially<br> Owned After<br> this Offering** | **Class B<br> Ordinary<br> Shares<br> Beneficially<br> Owned After<br> this Offering** | **Voting<br> Power<br> After this<br> Offering\*** |
|  | **Number** | **%** | **Number** | **%** | **Number** | **%** | **Number** | **%** | **%** |
| **Directors and Executive Officers\*\*:** | | | | | | | | | |
| Jia Li<sup>(1)</sup> |  |  | 368044 | 88.88% |  |  | 368044 | 100% | 72.88% |
| Bingyi Zhao<sup>(2)</sup> | 12245 | 0.03% |  |  | 12245 | 0.09% |  |  | 0.02% |
| Xiaochun Li |  |  |  |  |  |  |  |  |  |
| Quanshi Chen |  |  |  |  |  |  |  |  |  |
| Jean Christophe von Pfetten |  |  |  |  |  |  |  |  |  |
| **All directors and executive officers as a group (four individuals):** | 12245 | 0.03% | 368044 | 88.88% | 12245 | 0.09% | 368044 | 100% | 72.91% |
| **5% Shareholders\*\*\*:** |  |  |  |  |  |  |  |  |  |
| U Trend Limited<sup>(3)</sup> |  |  | 147359 | 35.59% |  |  | 147359 | 40.04% | 29.18% |
| Upincar Limited<sup>(4)</sup> |  |  | 149435 | 36.09% |  |  | 149435 | 40.60% | 29.59% |
| U Create Limited<sup>(5)</sup> |  |  | 71250 | 19.36% |  |  | 71250 | 19.36% | 14.11% |

---

\* 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. The number and percentage of Class A Ordinary Shares exclude Class A Ordinary Shares convertible from Class B Ordinary Shares as the beneficial ownership of Class B Ordinary Shares is presented separately.

\*\* Unless otherwise indicated, the business address of each of the individuals is 2F, Zuoan 88 A, Lujiazui, Shanghai, People's Republic of China.

\*\*\* The principal office of each of the 5% beneficial owners, unless stated otherwise, are located at Intershore Chambers, Road Town, Tortola, British Virgin Islands.

(1) Includes (i) 157,859 Class B Ordinary Shares held by U Trend Limited, a British Virgin Islands company
which is 100% owned by Mr. Jia Li; (ii) 149,435 Class B Ordinary Shares held by Upincar Limited, a British Virgin Islands company 100%
owned by Mr. Jia Li; and (iii) 71,250 Class B Ordinary Shares held by U Create Limited, a British Virgin Islands company 100% owned by
Mr. Jia Li. The business address of Mr. Jia Li is 2F, Zuoan 88 A, Lujiazui, Shanghai, People's Republic of China.

(2) Represents 12,245 Class A Ordinary Shares held by U Battery Limited, a British Virgin Islands company
100% owned by Ms. Bingyi Zhao. The business address of Ms. Bingyi Zhao is 2F, Zuoan 88 A, Lujiazui, Shanghai, People's Republic
of China.

(3) Represents 10,500 Class A Ordinary Shares and 147,359 Class B Ordinary Shares held by U Trend Limited,
a British Virgin Islands company which is 100% owned by Mr. Jia Li. The business address of Mr. Jia Li is 2F, Zuoan 88 A, Lujiazui, Shanghai,
People's Republic of China.

(4) Represents 149,435 Class B Ordinary Shares held by Upincar Limited, a British Virgin Islands company 100%
owned by Mr. Jia Li. The business address of Mr. Jia Li is 2F, Zuoan 88 A, Lujiazui, Shanghai, People's Republic of China.

(5) Represents 71,250 Class B Ordinary Shares held by U Create Limited, a British Virgin Islands company 100%
owned by Mr. Jia Li. The business address of Mr. Jia Li is 2F, Zuoan 88 A, Lujiazui, Shanghai, People's Republic of China.

As of the date of this prospectus, we are not aware of any arrangement that may, at a subsequent date, result in a change of control of our Company.

**DESCRIPTION OF SHARE CAPITAL**

 

The following description of our share capital and provisions of our memorandum and articles of association, as amended from time to time, are summaries and do not purport to be complete. Reference is made to our Third Amended and Restated Memorandum and Articles of Association, which are referred to in this section as our "Third Amended and Restated Articles of Association."

We were incorporated as an exempted company with limited liability under the Companies Act (As Revised) of the Cayman Islands (the "Cayman Companies Act") on June 17, 2021. A Cayman Islands exempted company:

● as an exempted company, does not have to file an annual return of its shareholders with the Registrar of Companies;

● 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 (such undertakings are usually given for 30 years in the first instance);

● 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 the 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).

**General**

As of the date of this prospectus, there were (i) outstanding 4,603,440 Class A Ordinary Shares and 368,044 Class B Ordinary Shares; (ii) an aggregate of 551,628 Class A Ordinary Shares issuable upon the exercise of outstanding warrants issued pursuant to the July 2025 SPA; (iii) an aggregate of 1,562,502 Class A Ordinary Shares issuable upon the exercise of outstanding warrants issued pursuant to the January 2025 SPA; and (iv) an aggregate of 50,000 Class A Ordinary Shares issuable upon the exercise of outstanding warrants pursuant to the December 2023 SPA.

*July 2025 SPA*

Pursuant to the July 2025 SPA, the Company issued common warrants with an exercise price of $2.50 and a five-year term. Holders may exercise the warrants on a cashless basis if an effective registration statement for the resale of the underlying shares is unavailable. The warrants include anti-dilution adjustments for stock splits and upon certain corporate structural or ownership events constituting "fundamental transactions".

*January 2025 SPA*

Pursuant to the January 2025 SPA, the Company issued common warrants with an exercise price of $4.80 and a five-year term. These warrants feature a cashless exercise option if no resale registration is effective. Additionally, pursuant to a certain amendment to existing warrants, dated January 23, 2025, the Company reduced the exercise price of certain existing warrants to $4.80, effective upon the closing of the registered direct offering. The common warrants permit cashless exercise if a registration statement for the resale of the underlying shares is not effective at the time of exercise. Additionally, the warrants contain customary anti-dilution provisions that adjust the exercise price and number of shares in the event of stock splits, combinations, or similar corporate transactions, as well as upon certain corporate structural or ownership events constituting "fundamental transactions".

 

*December 2023 SPA*

Pursuant to the December 2023 SPA, the Company issued two series of warrants (the "Series A Warrants" and the "Series B Warrants"). The Series A Warrants had an initial exercise price per share of $1.20, which exercise price was reset immediately following the thirtieth (30th) trading day following their date of issuance (the "Reset Date") at 105% of the arithmetic average of the three lowest per share volume weighted average of the Company's ordinary shares on Nasdaq for the twenty (20) trading days immediately prior to the Reset Date. The exercise price per share pursuant to the Series B Warrants is $1.54. Both of the Series A Warrants and the Series B Warrant are immediately exercisable and will expire on the fifth anniversary of the original issuance date, and are subject to anti-dilution provisions to reflect stock dividends and splits, subsequent rights offerings or other similar transactions (but not as a result of future securities offerings at lower prices), as well as certain corporate structural or ownership events constituting "fundamental transactions".

**Ordinary Shares**

As of the date of this prospectus, we are authorized to issue 3,999,411,812 Class A Ordinary Shares and 1,000,588,188 Class B Ordinary Shares. Holders of Class A Ordinary Shares and Class B Ordinary Shares have the same rights except for voting and conversion rights as described below.

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

Subject to the provisions of the Cayman Companies Act and our Second Amended and Restated Articles of Association, our directors have general and unconditional authority to (a) issue, allot and dispose of shares in such manner and on such terms and having such rights and being subject to such restrictions as they may from time to time determine, (b) grant rights over shares to be issued in one or more classes or series as they deem necessary or appropriate, at such times and on such terms as they think proper, and (c) grant options with respect to shares and issue warrants or similar instruments with respect thereto. Such authority could be exercised by the directors to allot shares which carry rights and privileges that are preferential to the rights attaching to our 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.

*Voting*. Holders of Class A Ordinary Shares shall at all times vote together as one class on all resolutions submitted to a vote by the members. Each Class A Ordinary Share shall entitle the holder thereof to one (1) vote on all matters subject to vote at general meetings of the Company, and each Class B Ordinary Share shall entitle the holder thereof to one hundred (100) votes on all matters subject to vote at general meetings of the Company.

*Conversion.* Each Class B Ordinary Share is convertible into one (1) Class A Ordinary Share at any time at the option of the holder thereof. The right to convert shall be exercisable by the holder of the Class B Ordinary Share delivering a written notice to the Company that such holder elects to convert a specified number of Class B Ordinary Shares into Class A Ordinary Shares. In no event shall Class A Ordinary Shares be convertible into Class B Ordinary Shares.

*Dividends*. Subject to any rights and restrictions of any other class of shares, our board of directors may, from time to time, declare dividends on the shares issued and authorize payment of the dividends out of our lawfully available funds. No dividends shall be declared by the board out of our company except the following:

● profits; or

● "share premium account," which represents the excess of the price paid to our company on issue of its shares over the par or "nominal" value of those shares, which is similar to the U.S. concept of additional paid in capital.

However, no dividend shall bear interest against the Company.

**Listing**

Our Class A Ordinary Shares are listed on the Nasdaq Capital Market under the symbol "UCAR."

**Transfer Agent and Registrar**

The transfer agent and registrar for our Class A Ordinary Shares is Transhare Corporation, at Bayside Center 1, 17755 North U.S. Highway 19, Suite #140, Clearwater, FL 33764.

**Dividends**

Subject to the provisions of the Cayman Companies Act and any rights and restrictions attaching to any of our shares:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the directors may declare dividends or distributions out of our funds which are lawfully available for that purpose; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) our shareholders may, by ordinary resolution, declare dividends but no such dividend shall exceed the amount recommended by the directors.

The directors, when paying dividends to shareholders, may make such payment wholly or partly in cash and/or in specie. No dividend shall bear interest.

**Voting Rights**

At any general meeting, a resolution put to the vote of the general meeting shall be decided on a show of hands, unless a poll is (before or on the declaration of the result of the show of hands) demanded by the chairperson of the meeting or any shareholder holding not less than ten per cent (10%) of the votes attaching to the shares present in person or by proxy at the general meeting.

Subject to any rights or restrictions as to voting attached to any shares, (i) on a show of hands, every shareholder present in person or by proxy (or, if a corporation or other non-natural person, by its duly authorized representative or proxy) shall, at a general meeting of our Company, each have one vote; and (ii) on a poll, every shareholder present in pension or by proxy (or, if a corporation or other non-natural person, by its duly authorized representative or proxy) shall have one vote for each Class A Ordinary Share, 100 votes for each Class B Ordinary Share.

**Conversion Rights**

Class A Ordinary Shares are not convertible. Each Class B Ordinary Share is convertible into one Class A Ordinary Share at any time at the option of the holder thereof. Upon any sale, transfer, assignment or disposition of any Class B Ordinary Share by a shareholder to any person who is not Jia Li or Chatchaval Jiaravanon or their affiliate, or upon a change of ultimate beneficial ownership of any Class B Ordinary Share to any person who is not Jia Li or Chatchaval Jiaravanon or their affiliate, such Class B Ordinary Share shall be automatically and immediately converted into the same number of Class A Ordinary Share.

**Modification of Rights of Shares**

Whenever our capital is divided into different classes of shares, subject to any rights or restrictions for the time being attached to any class of shares, the rights attaching to any class of shares may only be materially adversely varied 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 meeting of the holders of the shares of that class.

Subject to any rights or restrictions for the time being attached to any class of shares, the rights conferred on the holders of the shares of any class shall not be deemed to be materially adversely varied by, *inter alia*, the creation, allotment, or issue of further shares ranking pari passu with or subsequent to them or the redemption or purchase of any shares of any class by us. The rights of the holders of our shares shall not be deemed to be materially adversely varied by the creation or issue of shares with preferred or other rights, including, without limitation, the creation of shares with enhanced or weighted voting rights.

**Alteration of Share Capital**

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) increase our share capital by new shares of such amount fixed by that ordinary resolution;

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

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) cancel shares which, at the date of the passing of that ordinary resolution, have not been taken or agreed to be taken by any person and diminish the amount of our share capital by the amount of the shares so cancelled.

Our shareholders may, by special resolution, reduce our share capital and any capital redemption reserve in any manner authorized by law.

**Calls on Shares and Forfeiture**

Subject to the terms of allotment, the directors may from time to time make calls upon the shareholders in respect of any monies unpaid on their shares and each shareholder shall (subject to receiving at least 14 calendar days' notice specifying the time or times of payment), pay to us the amount called on such shares. Shareholders registered as the joint holders of a share shall be jointly and severally liable to pay all calls in respect of the share. If a call remains unpaid after it has become due and payable the person from whom it is due and payable shall pay interest on the amount unpaid from the day it became due and payable until it is paid at the rate of eight percent per annum. The directors may, at their discretion, waive payment of that interest wholly or in part.

We have a first and paramount lien on every share (whether or not fully paid) for all amounts (whether presently payable or not) payable at a fixed time or called in respect of that share. We also have a first and paramount lien on every share registered in the name of a person indebted or under liability to us (whether he is the sole registered holder of a share or one of two or more joint holders). The lien is for all amounts owing to us by the shareholder or the shareholder's estate (whether or not presently payable). At any time the directors may declare a share to be wholly or in part exempt from the lien on shares provisions of our Third Amended and Restated Articles of Association. Our lien on a share extends to any amount payable in respect of it, including but not limited to dividends.

We may sell, in such manner as the directors may determine, any share on which we have a lien. However, no sale will be made unless an amount in respect of which the lien exists is presently payable or until the expiration of 14 calendar days after a notice in writing, demanding payment of such part of the amount in respect of which the lien exists as is presently payable has been given to the registered holder of the share, or the persons entitled thereto by reason of his death or bankruptcy.

**Unclaimed Dividend**

A dividend that remains unclaimed after a period of six calendar years from the date of declaration of such dividend may be forfeited by the board of directors and, if so forfeited, shall revert to the Company.

**Forfeiture or Surrender of Shares**

If a shareholder fails to pay any call or installment of a call in respect of partly paid shares on the day appointed for payment, the directors may serve a notice on the shareholder requiring payment of the unpaid call or installment, together with any interest which may have accrued. The notice must name a further day (not earlier than the expiration of 14 calendar days from the date of the notice) on or before which the payment required by the notice is to be made, and must state that in the event of non-payment at or before the time appointed, the shares in respect of which the call is made will be liable to be forfeited.

If the requirements of any such notice are not complied with, the directors may, before the payment required by the notice has been made, resolve that any share in respect of which that notice has been given be forfeited.

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.

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

A certificate in writing made by a director that a share has been duly forfeited on a date stated in the certificate shall be conclusive evidence of the facts in the declaration as against all persons claiming to be entitled to the particular share(s).

The directors may accept the surrender for no consideration of any fully paid share.

**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.

**Redemption and Purchase of Own Shares**

Subject to the Cayman Companies Act and our articles of association, we may:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) issue shares that are to be redeemed or are liable to be redeemed, at our option or at the option of the shareholder holding those redeemable shares, in the manner and upon the terms as may be determined, before the issue of those shares, by either the directors or by the shareholders by special resolution;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) purchase our own shares (including any redeemable shares) on the terms and in the manner which have been approved by the directors or by the shareholders by ordinary resolution or are otherwise authorized by our articles of association; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) make a payment in respect of the redemption or purchase of our own shares in any manner permitted by the Cayman Companies Act, including out of capital.

**Transfer of Shares**

Our board of directors may, in its absolute discretion, decline to register any transfer of any Ordinary Share that has not been fully paid up or is subject to a company lien. Our board of directors may also decline to register any transfer of such Ordinary Share unless:

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

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

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

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

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) in the case of a transfer to joint holders, the number of joint holders to whom the Ordinary Share is to be transferred does not exceed four.

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

The registration of transfers may, on 10 calendar days' notice being given by advertisement in such one or more newspapers or by electronic means, be suspended and our register of members closed at such times and for such periods as our board of directors may from time to time determine. The registration of transfers, however, may not be suspended, and our register of members may not be closed, for more than 30 calendar days in any calendar year.

**Inspection of Books and Records**

Holders of our Ordinary Shares will have no general right under the Cayman Companies Act to inspect or obtain copies of our register of members or our corporate records (save for our memorandum and articles of association, our register of mortgages and charges and special resolutions of our shareholders).

**General Meetings**

As a Cayman Islands exempted company limited by shares, we are not obligated by the Cayman Companies Act to call shareholders' annual general meetings; accordingly, we may, but shall not be obliged to, in each calendar year hold a general meeting as an annual general meeting. Any annual general meeting held shall be held at such time and place as may be determined by our board of directors. All general meetings other than annual general meetings shall be called extraordinary general meetings.

Our chairman or a majority of our directors may call general meetings and they must on a shareholders' requisition forthwith proceed to convene an extraordinary general meeting of our Company. A shareholders' requisition is a requisition of shareholders holding at the date of deposit of the requisition shares which carry in aggregate not less than one-third of all votes attaching to our issued and outstanding shares that as at the date of the deposit carry the right to vote at our general meetings. The requisition must state the objects of the meeting and must be signed by the requisitionists and deposited at our registered office and may consist of several documents in like form, each signed by one or more requisitionist. If there are no directors as at the date of the deposit of the shareholders' requisition or if the directors do not within 21 calendar days from the date of the date of the deposit of the requisition duly proceed to convene a general meeting to be held within a further 21 calendar days, the requisitionists, or any of them representing more than one-half of the total voting rights of all of them, may themselves convene a general meeting, but any meeting so convened must not be held after the expiration of two calendar months after the expiration of the said 21 calendar days.

At least 10 calendar days' notice shall be given for any general meeting. Every notice shall be exclusive of the day on which it is given or deemed to be given and of the day for which it is given and shall specify the place, the day, and the hour of the meeting and the general nature of the business and shall be given in the manner mentioned in our articles of association or in such other manner if any as may be prescribed by our Company. Notwithstanding the foregoing, a general meeting will, whether or not the notice specified in our articles of association has been given and whether or not the provisions of our articles of association regarding general meetings have been complied with, be deemed to have been duly convened if it is so agreed: (a) in the case of an annual general meeting, by all the shareholders (or their proxies) entitled to attend and vote thereat; and (b) in the case of an extraordinary general meeting, by two-thirds of the shareholders having a right to attend and vote at the meeting, present in person or by proxy or, in the case of a corporation or other non-natural person, by its duly authorized representative or proxy.

No business, except for the appointment of a chairman for the meeting, may be transacted at any general meeting unless a quorum of shareholders is present at the time when the meeting proceeds to business. One or more shareholders holding shares which carry in aggregate (or representing by proxy) not less than one-third of all votes attaching to all shares in issue and entitled to vote at such general meeting, present in person or by proxy or, if a corporation or other non-natural person, by its duly authorized representative, shall be a quorum for all purposes.

If, within half an hour from the time appointed for the general meeting, a quorum is not present, the meeting will be dissolved.

The chairman may, with the consent of any general meeting at which a quorum is present (and shall if so directed by the meeting), adjourn the 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. When a meeting is adjourned for 14 calendar days or more, notice of the adjourned meeting shall be given in accordance with our articles of association.

At any general meeting, a resolution put to the vote of the meeting shall be decided on a show of hands, unless a poll is (before, or on, the declaration of the result of the show of hands) demanded by the chairman of the meeting or any shareholder holding not less than 10 per cent of the votes attaching to the shares present in person or by proxy, and unless a poll is so demanded, a declaration by the chairman of the meeting that a resolution has, on a show of hands, been carried, or carried unanimously, or by a particular majority, or lost, and an entry to that effect in the book of the proceedings of our Company, shall be conclusive evidence of the fact, without proof of the number or proportion of the votes recorded in favor of, or against, that resolution.

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

All questions submitted to a general meeting shall be decided by an ordinary resolution, except where a greater majority is required by our articles of association or by the Cayman Companies Act. In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of the meeting at which the show of hands takes place or at which the poll is demanded, shall be entitled to a second or casting vote.

**Directors**

Unless otherwise determined by our Company in general meeting, we are required to have a minimum of three directors and the exact number of directors will be determined from time to time by our board of directors.

A director may be appointed by ordinary resolution or by the directors. Our board of directors may, by the affirmative vote of a simple majority of the remaining directors present and voting at a board of directors meeting, appoint any person, to fill a casual vacancy on the board or as an addition to the existing board.

The remuneration of the directors may be determined by the directors or by ordinary resolution.

A director is not required to hold any shares in our Company by way of qualification. A director who is not a shareholder of our Company is nevertheless entitled to attend and speak at general meetings.

An appointment of a director may be on terms that the director will automatically retire from office (unless he has sooner vacated office) at the next or a subsequent annual general meeting or upon any specified event or after any specified period in a written agreement between our Company and the director, if any, but no such term will be implied in the absence of express provision. Each director whose term of office expires will be eligible for re-election at a meeting of the shareholders or re-appointment by the board of directors.

The office of a director will be vacated if the director:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) becomes bankrupt or makes any arrangement or composition with his creditors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) dies or is found to be or becomes of unsound mind;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) resigns his office by notice in writing to us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) without special leave of absence from the board of directors, is absent from meetings of the board of directors for three consecutive meetings and the board of directors resolves that his office be vacated; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) is removed from office pursuant to any other provision of our articles of association.

Each of the compensation committee and the nominating and corporate governance committee shall consist of at least three directors and the majority of the committee members shall be independent within the meaning of Section 5605(a)(2) of the Nasdaq listing rules. The audit committee shall consist of at least three directors, all of whom shall be independent within the meaning of Section 5605(a)(2) of the Nasdaq listing rules and will meet the criteria for independence set forth in Rule 10A-3 or Rule 10C-1 of the Exchange Act.

**Powers and Duties of Directors**

Subject to the provisions of the Cayman Companies Act and our Third Amended and Restated Memorandum and Articles of Association, our business shall be managed by the directors, who may exercise all our powers. No resolution passed by the shareholders in general meeting shall invalidate any prior act of the directors that would have been valid if that resolution had not been passed.

The directors may delegate any of their powers to committees consisting of such member or members of their body as they think fit. Any committee so formed shall in the exercise of the powers so delegated conform to any regulations that may be imposed on it by the directors. Our board of directors have established an audit committee, a compensation committee, and a nomination and corporate governance committee.

The board of directors may establish any committees, local boards, or agencies for managing any of our affairs and delegate to it any of the powers, authorities, and discretions for the time being vested in the directors (with power to sub-delegate) and may appoint any natural persons to be members of a committee, local board, or agency or to be managers or agents, and may fix their remuneration.

The directors may from time to time and at any time by power of attorney or otherwise appoint any company, firm, or person or body of persons, to be our attorney or attorneys or authorized signatory for such purposes and with such powers, authorities, and discretion (not exceeding those vested in or exercisable by the directors under our articles of association) and for such period and subject to such conditions as they may think fit. Any such power of attorney or other appointment may contain such provisions for the protection and convenience of persons dealing with any such attorney or authorized signatory 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 discretion vested in him.

The directors may from time to time at their discretion exercise all our powers to raise or borrow money and to mortgage or charge our undertaking, property and assets (present and future) and uncalled capital or any part thereof, to issue debentures, debenture stock, bonds, and other securities, whether outright or as collateral security for any of our or any third party's debts, liabilities, or obligations.

A director who is in any way, whether directly or indirectly, interested in a contract or transaction or proposed contract or transaction with our Company shall declare the nature of his interest at a meeting of the directors. A director may, as a director, vote (and be counted in the quorum) in respect of any contract, transaction, arrangement, or proposal in which he has an interest which is not a material interest or as described above provided that such director, if his interest (whether direct or indirect) in such contract or arrangement is material, has declared the nature of his interest at the earliest meeting of the board of directors at which it is practicable for him to do so, either specifically or by way of a general notice, and if such contract of arrangement is a transaction with a related party, such transaction has been approved by our audit committee.

A director may, vote (and be counted in the quorum) in respect of any contract, transaction, arrangement, or proposal in which he has an interest which is not a material interest or as described above provided that such director, if his interest (whether direct or indirect) in such contract or arrangement is material, has declared the nature of his interest at the earliest meeting of the board of directors at which it is practicable for him to do so, either specifically or by way of a general notice, and if such contract of arrangement is a transaction with a related party, such transaction has been approved by our audit committee.

**Capitalization of Profits**

Subject to the Cayman Companies Act, the directors may:

&nbsp;&nbsp;&nbsp;&nbsp;(a) resolve to capitalize an amount
standing to the credit of reserves (including a share premium account capital redemption reserve and profit and loss account), which
is available for distribution;

&nbsp;&nbsp;&nbsp;&nbsp;(b) appropriate the sum resolved
to be capitalized to the shareholders in proportion to the nominal amount of shares (whether or not fully paid) held by them respectively
and apply that sum on their behalf in or towards: (i) paying up the amounts (if any) for the time being unpaid on shares held by them
respectively, or (ii) paying up in full unissued shares or debentures of a nominal amount equal to that sum, and allot the shares or
debentures, credited as fully paid, to the shareholders (or as they may direct) in those proportions, or partly in one way and partly
in the other, but the share premium account, the capital redemption reserve, and profits which are not available for distribution may
for these purposes only be applied in paying up unissued shares to be allotted to shareholders credited as fully paid;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) make any arrangements they think fit to resolve a difficulty arising in the distribution of a capitalized reserve and in particular, without limitation, where shares or debentures become distributable in fractions the directors may deal with the fractions as they think fit;

&nbsp;&nbsp;&nbsp;&nbsp;(d) authorize a person to enter
(on behalf of all the shareholders concerned) into an agreement with us providing for either: (i) the allotment to the shareholders respectively,
credited as fully paid, of shares or debentures to which they may be entitled on the capitalization, or (ii) the payment by us on behalf
of the shareholders (by the application of their respective proportions of the reserves resolved to be capitalized) of the amounts or
part of the amounts remaining unpaid on their existing shares, and any such agreement made under this authority being effective and binding
on all those shareholders; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) generally do all acts and things required to give effect to the resolutions.

**Liquidation Rights**

If we are wound up, the shareholders may, subject to any other sanction required by the Cayman Companies Act, pass a special resolution allowing the liquidator to do either or both of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) divide amongst the shareholders in specie or in kind the whole or any part of our assets and, for that purpose, value any assets and determine how the division shall be carried out as between the shareholders or different classes of shareholders; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) vest the whole or any part of the assets in trustees upon such trusts for the benefit of the shareholders as the liquidator, with the like sanction, thinks fit, but so that no shareholder will be compelled to accept any asset upon which there is a liability.

**Register of Members**

Under the Cayman Companies Act, we must keep a register of members and there should be entered therein:

● the names and addresses of our shareholders, together with a statement of the shares held by each member, and such statement shall confirm (i) the amount paid or agreed to be considered as paid, on the shares of each member, (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 Companies Act, the register of members of our company is prima facie evidence of the matters set out therein (that is, the register of members will raise a presumption of fact on the matters referred to above unless rebutted) and a shareholder registered in the register of members is deemed as a matter of the Cayman Companies Act to have legal title to the shares as set against its name in the register of members. Upon the completion of our offerings, 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 Grand Court of the Cayman Islands 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.

The Cayman Companies Act is derived, to a large extent, from the older Companies Acts of England and Wales but does not follow recent United Kingdom statutory enactments, and accordingly there are significant differences between the Cayman Companies Act and the current Companies Act of the UK. In addition, the Cayman Companies Act differs from laws applicable to United States corporations and their shareholders. Set forth below is a summary of certain significant differences between the provisions of the Cayman Companies Act applicable to us and the comparable laws applicable to companies incorporated in the State of Delaware in the United States.

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|  | **Delaware** | **Cayman Islands** |
| *Title of Organizational Documents* | Certificate of Incorporation and Bylaws | Memorandum and Articles of Association |
| *Duties of Directors* | Under Delaware law, the business and affairs of a corporation are managed by or under the direction of its board of directors. In exercising their powers, directors are charged with a fiduciary duty of care to protect the interests of the corporation and a fiduciary duty of loyalty to act in the best interests of its shareholders. The duty of care requires that directors act in an informed and deliberative manner and inform themselves, prior to making a business decision, of all material information reasonably available to them. The duty of care also requires that directors exercise care in overseeing and investigating the conduct of the corporation's employees. The duty of loyalty may be summarized as the duty to act in good faith, not out of self-interest, and in a manner which the director reasonably believes to be in the best interests of the shareholders. | As a matter of Cayman Islands law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company and therefore it is considered that he owes the following duties to the company—a duty to act *bona fide* in the best interests of the company, a duty not to make a profit based on his or her position as director (unless the company permits him to do so) and a duty not to put himself in a position where the interests of the company conflict with his or her personal interest or his or her duty to a third party.<br>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 or her duties a greater degree of skill than may reasonably be expected from a person of his or her knowledge and experience. However, English and Commonwealth courts have moved towards an objective standard with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands. |

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| *Limitations on Personal Liability of Directors* | Subject to the limitations described below, a certificate of incorporation may provide for the elimination or limitation of the personal liability of a director to the corporation or its shareholders for monetary damages for a breach of fiduciary duty as a director. Such provision cannot limit liability for breach of loyalty, bad faith, intentional misconduct, unlawful payment of dividends or unlawful share purchase or redemption. In addition, the certificate of incorporation cannot limit liability for any act or omission occurring prior to the date when such provision becomes effective. | The Companies Act has no equivalent provision to Delaware law regarding the limitation of director's liability. However, as a matter of public policy, Cayman Islands law will not allow the limitation of a director's liability to the extent that the liability is a consequence of the director committing a crime or of the director's own fraud, dishonesty or willful default. |

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| *Indemnification of Directors, Officers, Agents, and Others* | A corporation has the power to indemnify any director, officer, employee, or agent of corporation who was, is, or is threatened to be made a party who acted in good faith and in a manner he believed to be in the best interests of the corporation, and if with respect to a criminal proceeding, had no reasonable cause to believe his conduct would be unlawful, against amounts actually and reasonably incurred. | &nbsp;&nbsp; Cayman Islands law does not limit the extent to which a company's memorandum and articles of association may provide for indemnification of directors and officers, 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.<br>Our Third Amended and Restated Articles of Association provide that we will indemnify every director, secretary, assistant secretary, or other officer for the time being and from time to time of our Company (but not including our auditors) and the personal representatives of the same and from: (a) all actions, proceedings, costs, charges, expenses, losses, damages, or liabilities incurred or sustained by such person, other than by reason of such person's own dishonesty, willful default, or fraud, in or about the conduct of our business or affairs (including as a result of any mistake of judgment) or in the execution or discharge of that person's duties, powers, authorities, or discretions; and (b) without limitation to paragraph (a) above, any costs, expenses, losses, or liabilities incurred by such person in defending (whether successfully or otherwise) any civil proceedings concerning us or our affairs in any court, whether in the Cayman Islands or elsewhere. |

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| *Interested Directors* | Under Delaware law, a transaction in which a director who has an interest in such transaction would not be voidable if (i) the material facts as to such interested director's relationship or interests are disclosed or are known to the board of directors and the board in good faith authorizes the transaction by the affirmative vote of a majority of the disinterested directors, even though the disinterested directors are less than a quorum, (ii) such material facts are disclosed or are known to the shareholders entitled to vote on such transaction and the transaction is specifically approved in good faith by vote of the shareholders, or (iii) the transaction is fair as to the corporation as of the time it is authorized, approved or ratified. Under Delaware law, a director could be held liable for any transaction in which such director derived an improper personal benefit. | Under our Third Amended and Restated Articles of Association, directors who are in any way, whether directly or indirectly, interested in a contract or proposed contract with our company must declare the nature of their interest at a meeting of the board of directors. Following such declaration, a director may vote in respect of any contract or proposed contract notwithstanding his or her interest, provided that in exercising any such vote, such director's duties remain as described above. |

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| *Voting Requirements* | The certificate of incorporation may include a provision requiring supermajority approval by the directors or shareholders for any corporate action.<br>In addition, under Delaware law, certain business combinations involving interested shareholders require approval by a supermajority of the non-interested shareholders. | As a matter of Cayman Islands law, certain matters must be approved by special resolution of the shareholders, including amending or adopting memorandum or articles of association of a Cayman Islands company, reduction of share capital, change of name, authorization of a plan of merger, voluntary winding up of the company or the recalling of the voluntary liquidation of the company.<br>The Cayman Companies Act requires that a special resolution be passed by a majority of at least two-thirds or such higher percentage as set forth in the memorandum and articles of association, of shareholders being entitled to vote and do vote in person or by proxy at a general meeting, or by unanimous written consent of shareholders entitled to vote at a general meeting. |

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| *Voting for Directors* | Under Delaware law, unless otherwise specified in the certificate of incorporation or bylaws of the corporation, directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. | Our Third Amended and Restated Articles of Association provide that our directors may be appointed by a resolution of our board of directors to fill a casual vacancy on the board of directors or as an addition to the board of directors or by an ordinary resolution of our shareholders. |
| *Cumulative Voting* | No cumulative voting for the election of directors unless so provided in the certificate of incorporation. | There are no prohibitions in relation to cumulative voting under the Cayman Companies Act but our Second Amended and Restated Articles of Association do not provide for cumulative voting. |
| *Directors' Powers Regarding Bylaws* | The certificate of incorporation may grant the directors the power to adopt, amend or repeal bylaws. | Our Third Amended and Restated Articles of Association may only be amended by a special resolution of the shareholders. |
| *Nomination and Removal of Directors and Filling Vacancies on Board* | Shareholders may generally nominate directors if they comply with advance notice provisions and other procedural requirements in company bylaws. Holders of a majority of the shares may remove a director with or without cause, except in certain cases involving a classified board or if the company uses cumulative voting. Unless otherwise provided for in the certificate of incorporation, directorship vacancies are filled by a majority of the directors elected or then in office. | Nomination and removal of directors and filling of board vacancies are governed by the terms of the memorandum and articles of association. Our Third Amended and Restated Articles of Association provide that directors may be removed with or without cause, by an ordinary resolution of our shareholders.<br>In addition, a director's office shall be vacated if the director (1) becomes bankrupt or makes any arrangement or composition with his creditors; (2) is found to be or becomes of unsound mind or dies; (3) resigns his office by notice in writing to the company; (4) without special leave of absence from the board, is absent from meetings of the board for three consecutive meetings and the board resolves that his office be vacated; or (5) is removed from office pursuant to any other provisions of our Third Amended and Restated Articles of Association. |

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|:---|:---|:---|
| *Mergers and Similar Arrangements* | Under Delaware law, with certain exceptions, a merger, consolidation, exchange or sale of all or substantially all the assets of a corporation must be approved by the board of directors and a majority of the outstanding shares entitled to vote thereon. Under Delaware law, a shareholder of a corporation participating in certain major corporate transactions may, under certain circumstances, be entitled to appraisal rights pursuant to which such shareholder may receive cash in the amount of the fair value of the shares held by such shareholder (as determined by a court) in lieu of the consideration such shareholder would otherwise receive in the transaction.<br>Delaware law also provides that a parent corporation, by resolution of its board of directors, may merge with any subsidiary, of which it owns at least 90% of each class of capital stock without a vote by shareholders of such subsidiary. Upon any such merger, dissenting shareholders of the subsidiary would have appraisal rights. | The Cayman Companies Act permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman Islands companies. For these purposes, (a) "merger" means the merging of two or more constituent companies and the vesting of their undertaking, property and liabilities in one of such companies as the surviving company, and (b) a "consolidation" means the combination of two or more constituent companies into a consolidated company and the vesting of the undertaking, property and liabilities of such companies to the consolidated company. In order to effect such a merger or consolidation, the directors of each constituent company must approve a written plan of merger or consolidation, which must then be authorized by (a) a special resolution of the shareholders of each constituent company, and (b) such other authorization, if any, as may be specified in such constituent company's articles of association. The plan must be filed with the Registrar of Companies in 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 shareholders and creditors of each constituent company and that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Court approval is not required for a merger or consolidation which is effected in compliance with these statutory procedures.<br>A merger between a Cayman Islands parent company and its Cayman Islands subsidiary or subsidiaries does not require authorization by a resolution of shareholders. For this purpose, a subsidiary is a company of which at least 90% of the issued shares entitled to vote are owned by the parent company.<br>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. |

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In addition, there are statutory provisions that facilitate the reconstruction and amalgamation of companies, provided that the arrangement is approved by (a) 75% in value of the shareholders or class of shareholders, as the case may be, or (b) a majority in number representing 75% in value of the creditors or each class of creditors, as the case may be, with whom the arrangement is to be made, that are, in each case, present and voting either in person or by proxy at a meeting, or meetings, convened for that purpose. The convening of the meetings and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder has the right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement if it determines that: (a) the statutory provisions as to the required majority vote have been met; (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; (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 (d) the arrangement is not one that would more properly be sanctioned under some other provision of the Cayman Companies Act.<br>The Cayman 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% of the shares affected within four months the offeror may, within a two-month period commencing on the expiration of such four-month period, require the holders of the remaining shares to transfer such shares on the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands but this is unlikely to succeed in the case of an offer which has been so approved unless there is evidence of fraud, bad faith or collusion.<br>If an arrangement and reconstruction is thus approved, or if a tender 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.<br>

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|:---|:---|:---|
| *Shareholder Suits* | Class actions and derivative actions generally are available to shareholders under Delaware law for, among other things, breach of fiduciary duty, corporate waste and actions not taken in accordance with applicable law. In such actions, the court generally has discretion to permit the winning party to recover attorneys' fees incurred in connection with such action. | In principle, we will normally be the proper plaintiff and as a general rule a derivative action may not be brought by a minority shareholder. However, based on English authorities, which would in all likelihood be of persuasive authority in the Cayman Islands, the Cayman Islands courts can be expected to follow and apply the common law principles (namely the rule in Foss v. Harbottle and the exceptions thereto) so that a non-controlling shareholder may be permitted to commence a class action against or derivative actions in the name of the company to challenge: (a) an act which is illegal or ultra vires with respect to the company and is therefore incapable of ratification by the shareholders; (b) an act which, although not ultra vires, requires authorization by a qualified (or special) majority (that is, more than a simple majority) which has not been obtained; and (c) an act which constitutes a "fraud on the minority" where the wrongdoers are themselves in control of the company. |
| *Inspection of Corporate Records* | Under Delaware law, shareholders of a Delaware corporation have the right during normal business hours to inspect for any proper purpose, and to obtain copies of list(s) of shareholders and other books and records of the corporation and its subsidiaries, if any, to the extent the books and records of such subsidiaries are available to the corporation. | Shareholders of a Cayman Islands exempted company have no general right under Cayman Islands law to inspect or obtain copies of register of members or other corporate records (other than, the memorandum and articles of association, the register of mortgages or charges and special resolutions passed by the shareholders) of the company. However, these rights may be provided in the company's memorandum and articles of association. Under Cayman Islands law, the names of current directors can be obtained from a search conducted at the Registrar of Companies in the Cayman Islands. |

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|:---|:---|:---|
| *Shareholder Proposals* | Unless provided in the corporation's certificate of incorporation or bylaws, Delaware law does not include a provision restricting the manner in which shareholders may bring business before a meeting. | The Cayman Companies Act provides shareholders with only limited rights to requisition a general meeting, and does not provide shareholders with any right to put any proposal before a general meeting. However, these rights may be provided in a company's articles of association. Our Third Amended and Restated Articles of Association allow our shareholders holding shares which carry in aggregate not less than one-third of all votes attaching to all of our issued and outstanding shares, to requisition a general meeting of our shareholders, in which case our chairman or a majority of our directors are obliged to call such meeting. If there are no directors as at the date of the deposit of the shareholders' requisition or if the directors do not within 21 calendar days from the date of the date of the deposit of the requisition duly proceed to convene a general meeting to be held within a further 21 calendar days, the requisitionists, or any of them representing more than one-half of the total voting rights of all of them, may themselves convene a general meeting, but any meeting so convened must not be held after the expiration of two calendar months after the expiration of the said 21 calendar days. Our Third Amended Articles of Association provide no other right to put any proposals before annual general meetings or extraordinary general meetings. As a Cayman Islands exempted company, we are not obligated by law to call shareholders' annual general meetings. However, our corporate governance guidelines require us to call an annual general meeting every year. |

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| | | |
|:---|:---|:---|
| *Approval of Corporate Matters by Written Consent* | Delaware law permits shareholders to take actions by written consent signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting of shareholders. | The Cayman Companies Act allows a special resolution to be passed in writing if signed by all shareholders who would have been entitled to vote on such matter at a general meeting (if authorized by the memorandum and articles of association). |
| *Calling of Special Shareholders Meetings* | Delaware law permits the board of directors or any person who is authorized under a corporation's certificate of incorporation or bylaws to call a special meeting of shareholders. | The Cayman Companies Act does not have provisions governing the proceedings of shareholders meetings, which are usually provided in the memorandum and articles of association. Please see above. |
| *Dissolution; Winding Up* | Under the Delaware General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution must be approved by shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors may it be approved by a simple majority of the corporation's outstanding shares. Delaware law allows a Delaware corporation to include in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board of directors. | Under the Cayman Companies Act, a company may be wound up voluntarily (a) by virtue of a special resolution, (b) because the period, if any, fixed for the duration of the company by its articles of association has expired, or (c) because the event, if any, has occurred, on the occurrence of which its articles of association provide that the company shall be wound up. Our articles of association contain no fixed period for the duration of our Company and no provisions for the winding up of our Company on the occurrence of any particular event. Under the Cayman Companies Act, a company may also be wound up compulsorily by order of the Grand Court of the Cayman Islands, including if the company is unable to pay its debts as they fall due or the Grand Court of the Cayman Islands is of the opinion that it is just and equitable that the company should be wound up. |

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**History of Share Issuances**

The following is a history of our share capital for the past three years. We note that any "ordinary shares" referred to below, and issued prior to August 13, 2024, have since been re-designated as Class A Ordinary Shares or as Class B Ordinary Shares. See "Prospectus Summary — Recent Development — Variation of Share Capital" in this prospectus. The below share numbers and their respective prices reflect the 1-for-100 reverse share split implemented on March 31, 2024. Solely for the purposes of this "History of Share Issuances" subsection, the number of ordinary shares following the 1-for-100 reverse share split is presented in hundredths where such number is not a whole number. Similarly, except for the par value, the share price is also presented in hundredths where such number is not a whole number.

On April 21, 2023, the Company closed its initial public offering (the "IPO") of 24,166.67 ordinary shares, pursuant to a registration statement on Form F-1 (File No.333-268949), which was declared effective by the SEC on March 31, 2023. The ordinary shares were priced at $600 per share and the IPO was conducted on a firm commitment basis. On April 25, 2023, WestPark Capital, Inc, as the representative of the underwriter of the IPO of the Company, partially exercised the over-allotment option to purchase an additional 833.33 ordinary shares at the IPO price of $600 per share.

On December 6, 2023, the Company closed a registered follow-on offering to three investors in connection with the offering and sale of 100,000 units, consisting of an aggregate of (a) 100,000 ordinary shares of the Company, (b) 100,000 Series A warrants, and (c) 100,000 Series B warrants, at a price of $120 per unit. As of the date of this prospectus, the investors have exercised all the Series B warrants for a total of 1,535,936.71 ordinary shares pursuant to an alternative cashless exercise clause under the Series B warrants. All Series A warrants are outstanding as of the date of this prospectus.

On March 1, 2024, the Company issued 300,000 ordinary shares (valued at $2,625,000) to Lingzhi Zeng, the sole shareholder of Matson (Hong Kong) Industry Co., Limited, in a transaction to acquire 26.25% of Matson (Hong Kong) Industry Co., Limited's total equity.

On June 10, 2024, the Company issued and sold to Big Benefit Ltd., an aggregate of 419,289 ordinary shares of the Company, at a purchase price of $4.77 per ordinary share, for an aggregate purchase price of $2,000,008.53.

On June 15, 2024, the Company issued and sold to Fortune Light Assets Ltd., an aggregate of 209,644 ordinary shares of the Company, at a purchase price of $4.77 per ordinary share, for an aggregate purchase price of $1,000,001.88.

On July 3, 2024, the Company issued and sold to Fortune Light Assets Ltd., an aggregate of 209,644 ordinary shares of the Company, at a purchase price of $4.77 per ordinary share, for an aggregate purchase price of $1,000,001.88.

The 2024 AGM of the Company was held on August 13, 2024. At the 2024 AGM, the shareholders of the Company adopted the following resolutions with respect to the variation of share capital:

&nbsp;&nbsp;&nbsp;&nbsp;(a) re-designated all of the issued shares of a par value of US$0.00001 each in the capital of the Company (other than the 71,250 ordinary shares held by U Create Limited, the 157,859 ordinary shares held by U Trend Limited, the 149,435 ordinary shares held by Upincar Limited and the 209,644 ordinary shares held by Fortune Light Assets Ltd) into Class A Ordinary Shares of US$0.00001 each, with each Class A Ordinary Share entitled to one vote;

&nbsp;&nbsp;&nbsp;&nbsp;(b) re-designated the 71,250 ordinary shares held by U Create Limited, the 157,859 ordinary shares held by U Trend Limited, the 149,435 ordinary shares held by Upincar Limited and the 209,644 ordinary shares held by Fortune Light Assets Ltd into Class B Ordinary Shares of US$0.00001 each, with each Class B Ordinary Share entitled to 20 votes;

&nbsp;&nbsp;&nbsp;&nbsp;(c) re-designated 3,996,621,812 authorized but unissued ordinary shares as Class A Ordinary Shares; and

&nbsp;&nbsp;&nbsp;&nbsp;(d) re-designated 1,000,000,000 authorized but unissued ordinary shares as Class B Ordinary Shares,

As a result, immediately following the 2024 AGM, the authorized share capital of the Company was varied from US$50,000 divided into 5,000,000,000 ordinary shares of par value of US$0.00001 each, to US$50,000 divided into 3,999,411,812 Class A Ordinary Shares of a par value of US$0.00001 each and 1,000,588,188 Class B Ordinary Shares of a par value of US$0.00001 each.

On January 27, 2025, the Company issued and sold to certain institutional investors, (i) 648,000 Class A Ordinary Shares, (ii) pre-funded warrants to purchase up to 393,668 Class A Ordinary Shares in a registered direct offering, and (iii) common warrants to purchase up to 1,562,502 Class A Ordinary Shares in a concurrent private placement at a combined offering price for each Class A Ordinary Share and accompanying common warrant of $4.80. The gross proceeds to the Company were approximately $5 million before deducting the placement agent's fees and other offering expenses.

On July 25, 2025, the Company issued and sold to certain institutional investors, (i) 445,000 Class A Ordinary Shares, (ii) pre-funded warrants to purchase up to 106,628 Class A Ordinary Shares in a registered direct offering, and (iii) common warrants to purchase up to 551,628 Class A Ordinary Shares in a concurrent private placement at a combined offering price for each Class A Ordinary Share and accompanying common warrant of $2.50. The gross proceeds to the Company were approximately $1.38 million before deducting the placement agent's fees and other offering expenses.

**Privacy Notice**

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***Introduction***

This privacy notice puts our shareholders on notice that through your investment in the Company you will provide us with certain personal information which constitutes personal data within the meaning of the DPA ("personal data").

In the following discussion, the "Company" refers to us and our affiliates and/or delegates, except where the context requires otherwise.

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***Investor Data***

We will collect, use, disclose, retain and secure personal data to the extent reasonably required only and within the parameters that could be reasonably expected during the normal course of business. We will only process, disclose, transfer or retain personal data to the extent legitimately required to conduct our activities of on an ongoing basis or to comply with legal and regulatory obligations to which we are subject. We will only transfer personal data in accordance with the requirements of the DPA and will apply appropriate technical and organizational information security measures designed to protect against unauthorized or unlawful processing of the personal data and against the accidental loss, destruction or damage to the personal data.

In our use of this personal data, we will be characterized as a "data controller" for the purposes of the DPA, while our affiliates and service providers who may receive this personal data from us in the conduct of our activities may either act as our "data processors" for the purposes of the DPA or may process personal information for their own lawful purposes in connection with services provided to us.

We may also obtain personal data from other public sources. Personal data includes, without limitation, the following information relating to a shareholder and/or any individuals connected with a shareholder as an investor: name, residential address, email address, contact details, corporate contact information, signature, nationality, place of birth, date of birth, tax identification, credit history, correspondence records, passport number, bank account details, source of funds details and details relating to the shareholder's investment activity.

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***Who this Affects***

If you are a natural person, this will affect you directly. If you are a corporate investor (including, for these purposes, legal arrangements such as trusts or exempted limited partnerships) that provides us with personal data on individuals connected to you for any reason in relation your investment in the Company, this will be relevant for those individuals and you should transmit the content of this Privacy Notice to such individuals or otherwise advise them of its content.

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***How the Company May Use a Shareholder's Personal Data***

The Company, as the data controller, may collect, store and use personal data for lawful purposes, including, in particular:

&nbsp;&nbsp;&nbsp;&nbsp;(i) where this is necessary for the performance of our rights and
obligations under any purchase agreements;

&nbsp;&nbsp;&nbsp;&nbsp;(ii) where this is necessary for compliance with a legal and regulatory
obligation to which we are subject (such as compliance with anti-money laundering and FATCA/CRS requirements); and/or

&nbsp;&nbsp;&nbsp;&nbsp;(iii) where this is necessary for the purposes of our legitimate
interests and such interests are not overridden by your interests, fundamental rights or freedoms.

Should we wish to use personal data for other specific purposes (including, if applicable, any purpose that requires your consent), we will contact you.

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***Why We May Transfer Your Personal Data***

In certain circumstances we may be legally obliged to share personal data and other information with respect to your shareholding with the relevant regulatory authorities such as the Cayman Islands Monetary Authority or the Tax Information Authority. They, in turn, may exchange this information with foreign authorities, including tax authorities.

We anticipate disclosing personal data to persons who provide services to us and their respective affiliates (which may include certain entities located outside the United States, the Cayman Islands or the European Economic Area), who will process your personal data on our behalf.

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***The Data Protection Measures We Take***

Any transfer of personal data by us or our duly authorized affiliates and/or delegates outside of the Cayman Islands shall be in accordance with the requirements of the DPA.

We and our duly authorized affiliates and/or delegates shall apply appropriate technical and organizational information security measures designed to protect against unauthorized or unlawful processing of personal data, and against accidental loss or destruction of, or damage to, personal data.

We shall notify you of any personal data breach that is reasonably likely to result in a risk.

**DESCRIPTION OF THE SECURITIES WE ARE OFFERING** 

We are offering Units, each Unit consisting of one Class A Ordinary Share and one Warrant to purchase one Class A Ordinary Share. We are also offering to each purchaser whose purchase of Class A Ordinary Shares in this offering would otherwise result in the purchaser, together with its affiliates, beneficially owning more than 4.99% (or, at the election of the purchaser, up to 9.99%) of our outstanding Class A Ordinary Shares immediately following the consummation of this offering, the opportunity to purchase, if the purchaser so chooses, Units containing Pre-funded Warrants in lieu of the Class A Ordinary Shares that would otherwise result in the purchaser's beneficial ownership exceeding 4.99% (or, at the election of the purchaser, up to 9.99%) of our outstanding Class A Ordinary Shares. For each Unit including a Pre-funded Warrant we sell (without regard to any limitation on exercise set forth therein), the number of Units including a Class A Ordinary Share we are offering will be decreased on a one-for-one basis. Because one Warrant is being sold together in this offering with each Class A Ordinary Share or, in the alternative, each Pre-funded Warrant to purchase one Class A Ordinary Share, the number of Warrants sold in this offering will not change as a result of a change in the mix of the Class A Ordinary Shares and Pre-funded Warrants sold.

The Units have no standalone rights and will not be certificated or issued as standalone securities. The Class A Ordinary Shares or Pre-funded Warrants and Warrants comprising the Units are immediately separable and will be issued separately in this offering.

**Class A Ordinary Shares** 

Please see the section titled "Description of Share Capital" in this prospectus for a description of the material terms of our Class A Ordinary Shares and our third amended and restated articles of association.

**Pre-funded Warrants and Warrants** 

*The following summary of certain terms and provisions of the Pre-funded Warrants and Warrants offered hereby is not complete and is subject to, and qualified in its entirety by, the provisions of the form of Pre-funded Warrant and the form of Warrant, which will be filed as exhibits to the registration statement of which this prospectus forms a part. Prospective investors should carefully review the terms and provisions set forth in the form of Warrant and form of Pre-funded Warrant. The Pre-funded Warrants and Warrants will be issued in certificated form only.*

***Exercisability***. The Pre-funded Warrants are exercisable at any time after their original issuance until they are exercised in full. The Warrants are immediately exercisable at any time after their issuance and at any time up to the date that is one (1) year after their issuance. Each of the Warrants and the Pre-funded Warrants will be exercisable, at the option of each holder, in whole or in part by delivering to us a duly executed exercise notice with payment in full in immediately available funds for the number of Class A Ordinary Shares purchased upon such exercise (except in the case of a cashless exercise or zero cash exercise, as discussed below). We may be required to pay certain amounts as liquidated damages as specified in the warrants in the event we do not deliver Class A Ordinary Shares upon exercise of the warrants within the time periods specified in the warrants. No fractional Class A Ordinary Shares will be issued in connection with the exercise of a warrant.

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***Cashless Exercise and Zero Cash Exercise.*** The holder may, in its sole discretion, elect to exercise the Pre-funded Warrant through a cashless exercise, in which case the holder would receive upon such exercise the net number of Class A Ordinary Shares determined according to the formula set forth in the Pre-funded Warrant. If a registration statement registering the issuance of the Class A Ordinary Shares underlying the Warrants under the Securities Act is not effective or available, the holder may, in its sole discretion, elect to exercise the Warrant through a cashless exercise, in which case the holder would receive upon such exercise the net number of Class A Ordinary Shares determined according to the formula set forth in the Warrant.

A holder of Warrants may also provide notice and elect to exercise the Warrant by way of a zero cash exercise option pursuant to which they would receive, for no additional cash consideration, an aggregate number of shares equal to the product of (x) the aggregate number of Class A Ordinary Shares that would be issuable upon a cash exercise of the Warrant and (y) 2.0. We do not expect to receive any proceeds from the zero cash exercise price option of the Warrants, because it is highly unlikely that a holder of the Warrants would elect to exercise the Warrants by paying cash or via cashless exercise in lieu of the zero cash exercise price option. The maximum number of Class A Ordinary Shares issuable under all Warrants (including the zero cash exercise price option) shall not exceed 36,363,636. As such, holders of the Warrants may elect to be issued up to 36,363,636 Class A Ordinary Shares upon the zero cash exercise price option. In addition, on the Reset Dates (as described below), the exercise price of the Warrants will be adjusted to the price that is equal to 70% and 50%, respectively, of the Basis Price, and upon each adjustment to the exercise price for the Warrants, the number of issuable warrant shares will be proportionately increased so that the nominal aggregate exercise price of the Warrants will remain the same.

***Exercise Limitation***. A holder will not have the right to exercise any portion of the Pre-funded Warrants or Warrants if the holder (together with its affiliates) would beneficially own in excess of 4.99% (or, upon election of the holder prior to the issuance of any warrants, up to 9.99%) of the number of shares of our Class A Ordinary Shares outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the warrants. However, any holder may increase or decrease such percentage to any other percentage not in excess of 9.99%, upon at least 61 days' prior notice from the holder to us with respect to any increase in such percentage.

 ***Exercise Price***. The exercise price for the Pre-funded Warrants is $0.001 per Class A Ordinary Share. Each Warrant offered hereby will have an initial exercise price per Class A Ordinary Share equal to $0.66 (100% of the public offering price of each Unit in this offering). The exercise price for the Warrants will be adjusted downward (each, a "Reset Price") on each of the 2<sup>nd</sup> and 5<sup>th</sup> trading day (each, a "Reset Date") following the closing of this offering to the price that is equal to 70% and 50%, respectively, of the Basis Price, provided that the Reset Price is less than the exercise price then in effect and provided that in no event shall the exercise price of the Warrants be reduced to a price that is less than a floor price of the greater of (i) $0.10 and (ii) 20% of the closing bid price of the Class A Ordinary Shares on the date prior to the execution of the underwriting agreement entered into in connection with this offering. If the exercise price is so adjusted on a Reset Date, the number of Class A Ordinary Shares underlying the Warrants will also be proportionally increased on each such Reset Date so that the applicable Reset Price multiplied by the increased number of Class A Ordinary Shares equal the aggregate proceeds that would have resulted from the full exercise of the Warrants immediately prior to the applicable Reset Date. The exercise price and number of Class A Ordinary Shares issuable upon exercise are subject to appropriate adjustment in the event of stock dividends, stock splits, reorganizations or similar events affecting our Class A Ordinary Shares.

***Transferability***. Subject to applicable laws, the Warrants and Pre-funded Warrants may be offered for sale, sold, transferred, or assigned without our consent.

***Exchange Listing***. We do not intend to list the Warrants or the Pre-funded Warrants offered in this offering on any securities exchange or other trading market. Without an active trading market, the liquidity of these securities will be limited.

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***Rights as a Shareholder***. Except as otherwise provided in the Warrants or the Pre-funded Warrants or by virtue of such holder's ownership of our Class A Ordinary Shares, the holder of a Warrant or Pre-funded Warrant does not have the rights or privileges of a holder of our Class A Ordinary Shares, including any voting rights, until the issuance of Class A Ordinary Shares upon exercise of the warrant. Holders of Pre-funded Warrants have the right to participate in dividends and holders of Pre-funded Warrants and Warrants have the right to participate in certain distributions as specified in the warrant.

***Fundamental Transactions***. In the event of a fundamental transaction, as described in the Warrants and the Pre-funded Warrants and generally including, with certain exceptions, any reorganization, recapitalization, or reclassification of our Class A Ordinary Shares, the sale, transfer, or other disposition of all or substantially all of our properties or assets, our consolidation or merger with or into another person, the acquisition of more than 50% of the voting power represented by our outstanding Ordinary Shares, the holders of the Warrants and the Pre-funded Warrants will be entitled to receive upon exercise of the warrants the kind and amount of securities, cash or other property that the holders would have received had they exercised the warrants immediately prior to such fundamental transaction.

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***Governing Law***. The Pre-funded Warrants and the Warrants are governed by New York law.

**SHARES ELIGIBLE FOR FUTURE SALE**

Future sales of substantial amounts of our Class A Ordinary Shares in the public market after this offering, or the possibility of these sales occurring, could adversely affect the prevailing market prices for our Class A Ordinary Shares and could impair our ability to raise equity capital through the sale of our equity securities in the future.

Upon completion of this firm-commitment underwritten offering (excluding the exercise of the over-allotment option and assuming the sale of all of the Units offered hereby and no sale of any Units containing a Pre-funded Warrant and at an assumed public offering price of $0.66 per Unit), based on 4,603,440 Class A Ordinary Shares and 368,044 Class B Ordinary Shares outstanding as of the date of this prospectus, we will have 13,694,349 Class A Ordinary Shares and 368,044 Class B Ordinary Shares outstanding, assuming no Pre-funded Warrants are sold in this offering, and excluding Class A Ordinary Shares issuable upon the exercise of the Warrants sold in this offering. These Class A Ordinary Shares will be freely tradable without restriction or further registration or qualifications under the Securities Act.

We, our directors and executive officers have agreed not to sell any Class A Ordinary Shares for a period of sixty (60) days from the date of closing of this offering, subject to certain exceptions and extensions. See "Underwriting" for a description of these lock-up provisions.

**TAX CONSIDERATIONS**

**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 or holders of our Class A Ordinary Shares 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. Payments of dividends and capital in respect of our Class A 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 Class A Ordinary Shares, as the case may be, nor will gains derived from the disposal of our Class A Ordinary Shares be subject to Cayman Islands income or corporate tax.

**PRC Taxation**

***Income Tax and Withholding Tax***

In March 2007, the NPC enacted the Enterprise Income Tax Law, or EIT Law, which became effective on January 1, 2008 (as amended in December 2018). The EIT Law provides that enterprises organized under the laws of jurisdictions outside China with their "de facto management bodies" located within China may be considered PRC resident enterprises and therefore subject to EIT at the rate of 25% on their worldwide income. The Implementing Rules of the EIT Law further defines the term "de facto management body" as the management body that exercises substantial and overall management and control over the business, personnel, accounts and properties of an enterprise.

In April 2009, the SAT issued the Notice Regarding the Determination of Chinese-Controlled Overseas Incorporated Enterprises as PRC Tax Resident Enterprises on the Basis of De Facto Management Bodies, known as 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 deemed to be located in China. Although Circular 82 only applies to offshore enterprises controlled by PRC enterprises or PRC enterprise groups, not offshore enterprises 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" test should be applied in determining the tax resident status of all offshore enterprises.

According to SAT Notice 82, a Chinese-controlled offshore incorporated enterprise will be regarded as a PRC tax resident by virtue of having a "de facto management body" in China and will be subject to PRC enterprise income tax on its worldwide income only if all of the following criteria are met: (i) the places where senior management and senior management departments that are responsible for daily production, operation and management of the enterprise perform their duties are mainly located within the territory of China; (ii) financial decisions (such as money borrowing, lending, financing and financial risk management) and personnel decisions (such as appointment, dismissal and salary and wages) are decided or need to be decided by organizations or persons located within the territory of China; (iii) main property, accounting books, corporate seal, the board of directors and files of the minutes of shareholders' meetings of the enterprise are located or preserved within the territory of China; and (iv) one half (or more) of the directors or senior management staff having the right to vote habitually reside within the territory of China.

The Administrative Measures for Enterprise Income Tax of Chinese-Controlled Overseas Incorporated Resident Enterprises (Trial Version), or Bulletin 45, further clarifies certain issues related to the determination of tax resident status. Bulletin 45 also specifies that when provided with a resident Chinese-controlled, offshore-incorporated enterprise's copy of its recognition of residential status, a payer does not need to withhold a 10% income tax when paying certain PRC-source income, such as dividends, interest and royalties to such Chinese-controlled offshore-incorporated enterprise.

We believe that the Cayman Islands holding company, U Power Limited, is not a PRC resident enterprise for PRC tax purposes. U Power Limited is a company incorporated outside China. 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 China. As such, we do not believe that our company meets all of the conditions above or is a PRC resident enterprise for PRC tax purposes. For the same reasons, we believe our other entities outside 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 our position and there is a risk that the PRC tax authorities may deem our company as a PRC resident enterprise since a substantial majority of the members of our management team are located in China, in which case we would be subject to the EIT at the rate of 25% on worldwide income. If the PRC tax authorities determine that the Cayman Islands holding company is a "resident enterprise" for EIT purposes, a number of unfavorable PRC tax consequences could follow.

One example is a 10% withholding tax would be imposed on dividends we pay to our non-PRC enterprise shareholders and with respect to gains derived by our non-PRC enterprise shareholders from transferring our Class A Ordinary Shares. It is unclear whether, if we are considered a PRC resident enterprise, holders of our Class A Ordinary Shares would be able to claim the benefit of income tax treaties or agreements entered into between China and other countries or areas.

According to the Announcement of SAT on Several Issues Concerning the Enterprise Income Tax on Indirect Property Transfer by Non-Resident Enterprises, or Circular 7, which was promulgated by the SAT and became effective on February 3, 2015, if a non-resident enterprise transfers the equity interests of a PRC resident enterprise indirectly by transfer of the equity interests of an offshore holding company (other than a purchase and sale of shares issued by a PRC resident enterprise in the public securities market) without a reasonable commercial purpose, PRC tax authorities have the power to reassess the nature of the transaction and the indirect equity transfer may be treated as a direct transfer. As a result, the gain derived from such transfer, which means the equity transfer price less the cost of equity, will be subject to PRC withholding tax at a rate of up to 10%.

Under the terms of Circular 7, a transfer which meets all of the following circumstances shall be directly deemed as having no reasonable commercial purposes if:

● over 75% of the value of the equity interests of the offshore holding company are directly or indirectly derived from PRC taxable properties;

● at any time during the year before the indirect transfer, over 90% of the total properties of the offshore holding company are investments within PRC territories, or in the year before the indirect transfer, over 90% of the offshore holding company's revenue is directly or indirectly derived from PRC territories;

● the function performed and risks assumed by the offshore holding company are insufficient to substantiate its corporate existence; or

● the foreign income tax imposed on the indirect transfer is lower than the PRC tax imposed on the direct transfer of the PRC taxable properties.

On October 17, 2017, the SAT issued the Announcement on Issues Relating to Withholding at Source of Income Tax of Non-resident Enterprises, or Circular 37, which took effect on December 1, 2017. Circular 37 purports to provide further clarifications by setting forth the definitions of equity transfer income and tax basis, the foreign exchange rate to be used in the calculation of the withholding amount and the date on which the withholding obligation arises.

Specifically, Circular 37 provides that where the transfer income subject to withholding at source is derived by a non-PRC resident enterprise in instalments, the instalments may first be treated as recovery of costs of previous investments. Upon recovery of all costs, the tax amount to be withheld must then be computed and withheld.

There is uncertainty as to the application of Circular 7 and Circular 37. Circular 7 and Circular 37 may be determined by the PRC tax authorities to be applicable to transfers of our shares that involve non-resident investors, if any of such transactions were determined by the tax authorities to lack a reasonable commercial purpose.

As a result, we and our non-resident investors in such transactions may become at risk of being taxed under Circular 7 and Circular 37, and we may be required to comply with Circular 7 and Circular 37 or to establish that we should not be taxed under the general anti-avoidance rule of the EIT Law. This process may be costly and have a material adverse effect on our financial condition and results of operations.

***Value-added Tax***

Under the Circular on Comprehensively Promoting the Pilot Program of the Collection of Value-added Tax to Replace Business Tax, or Circular 36, which was promulgated by the Ministry of Finance and the SAT on March 23, 2016 and became effective on May 1, 2016, entities and individuals engaging in the sale of services, intangible assets or fixed assets within the territory of the PRC are required to pay value added tax, or VAT, instead of business tax.

According to the Circular 36, our PRC subsidiaries and consolidated affiliated entity are subject to VAT, at a rate of 6% to 17% on proceeds received from customers.

According to the Circular of the Ministry of Finance and the SAT on Adjusting Value-added Tax Rates, where a taxpayer engages in a taxable sales activity for the value-added tax purpose or imports goods, the previous applicable 17% tax rates are lowered to 16%.

According to the Circular on Policies to Deepen Value-added Tax Reform, where a taxpayer engages in a taxable sales activity for the value-added tax purpose or imports goods, the previous applicable 16% and 10% tax rates are lowered to 13% and 9% respectively.

Under the Value-added Tax Law of the People's Republic of China, which became effective on January 1, 2026, entities and individuals engaging in the sale of services, intangible assets, or real estate within the territory of the PRC are required to pay VAT. According to the Value-added Tax Law, PRC entities are subject to VAT at statutory rates of 13%, 9%, and 6% on taxable sales, depending on the specific category of goods or services.

**Material U.S. Federal Income Tax Consequences**

The following brief discussion is a summary of U.S. federal income tax considerations generally applicable to the ownership and disposition of our Class A Ordinary Shares by a U.S. Holder (as defined below) that acquires our Class A Ordinary Shares in this offering and holds our Class A 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 brief summary discussion is based upon existing U.S. federal tax law, which is subject to differing interpretations or change, possibly with retroactive effect. No ruling has been sought from the Internal Revenue Service (IRS), with respect to any U.S. federal income tax consequences described below, and there can be no assurance that the 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, any withholding or information reporting requirements, or any state, local and non-U.S. tax considerations relating to the ownership or disposition of our Class A Ordinary Shares. The following does not address all aspects of U.S. federal income taxation that may be important to particular investor 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 market-to-market method of accounting;

● certain former U.S. citizens or long-term residents;

● governments or agencies or instrumentalities thereof;

● tax-exempt entities (including private foundations);

● holders who acquired our Class A Ordinary Shares pursuant to the exercise of any employee share option or otherwise as compensation;

● investors that will hold our Class A Ordinary Shares as part of a straddle, hedging, conversion or other integrated transaction for U.S. federal income tax purposes;

● persons holding their Class A Ordinary Shares in connection with a trade or business outside the United States;

● persons that actually or constructively own 10% or more of our voting power or value (including by reason of owning our Class A Ordinary Shares);

● investors required to accelerate the recognition of any item of gross income with respect to their Class A Ordinary Shares as a result of such income being recognized on an applicable financial statement;

● investors that have a functional currency other than the U.S. dollar;

● partnerships or other entities taxable as partnerships for U.S. federal income tax purposes, or persons holding Class A Ordinary Shares through such entities, all of whom may be subject to tax rules that differ significantly from those discussed below.

The discussion set forth below is addressed only to U.S. Holders that purchase Class A Ordinary Shares in this offering. Prospective purchasers are urged to consult with their own tax advisors about the application of the U.S. federal income tax rules to their particular circumstances as well as the state, local, foreign and other tax consequences to them of the purchase, ownership and disposition of our Class A Ordinary Shares.

The brief description below of the U.S. federal income tax consequences to "U.S. Holders" will apply to you if you are a beneficial owner of Class A Ordinary Shares and you are, for U.S. federal income tax purposes,

● an individual who is a citizen or resident of the United States;

● a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) organized under the laws of the United States, any state thereof or the District of Columbia;

● an estate whose income is subject to U.S. federal income taxation regardless of its source; or

● a trust that (1) is subject to the primary supervision of a court within the United States and the control of one or more U.S. persons for all substantial decisions or (2) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person.

If a partnership (or other entities treated as a partnership for United States federal income tax purposes) is a beneficial owner of our Class A Ordinary Shares, the tax treatment of a partner in the partnership will depend upon the status of the partner and the activities of the partnership. Partnerships and partners of a partnership holding our Class A Ordinary Shares are urged to consult their tax advisors regarding an investment in our Class A Ordinary Shares.

An individual is considered a resident of the U.S. for federal income tax purposes if he or she meets either the "Green Card Test" or the "Substantial Presence Test" described as follows:

The Green Card Test: You are a lawful permanent resident of the United States, at any time, if you have been given the privilege, according to the immigration laws of the United States, of residing permanently in the United States as an immigrant. You generally have this status if the U.S. Citizenship and Immigration Services issued you an alien registration card, Form I-551, also known as a "green card."

The Substantial Presence Test: If an alien is present in the United States on at least 31 days of the current calendar year, he or she will (absent an applicable exception) be classified as a resident alien if the sum of the following equals 183 days or more (See §7701(b)(3)(A) of the Internal Revenue Code and related Treasury Regulations):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The actual days in the United States in the current year; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. One-third of his or her days in the United States in the immediately preceding year; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. One-sixth of his or her days in the United States in the second preceding year.

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***Passive Foreign Investment Company ("PFIC") Consequences***

A non-U.S. corporation, such as our Company, will be classified as a PFIC for U.S. federal income tax purposes for any taxable year if, applying applicable look-through rules, 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 (the "asset test"). For this purpose, cash and assets readily convertible into cash are categorized as passive assets and the company's goodwill and other unbooked intangibles not reflected on its balance sheet are taken into account. Passive income generally includes, among other things, dividends, interest, income equivalent to 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.

Based upon our current and projected income and assets, including the proceeds we received from our initial public offering and the value of our Class A Ordinary Shares, 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 for any taxable year is a factual determination made annually that will depend, in part, upon the composition and classification of our income and assets. Furthermore, fluctuations in the market price of our Class A Ordinary Shares may cause us to be classified as 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 other unbooked intangibles, may be determined by reference to the market price of our Class A Ordinary Shares from time to time (which may be volatile). In addition, 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 our initial public 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 becoming classified as a PFIC may substantially increase.

If we are a PFIC for your taxable year(s) during which you hold Class A Ordinary Shares, you will be subject to special tax rules with respect to any "excess distribution" that you receive and any gain you realize from a sale or other disposition (including a pledge) of the Class A Ordinary Shares, unless you make a "mark-to-market" election as discussed below. Distributions you receive in a taxable year that are greater than 125% of the average annual distributions you received during the shorter of the three preceding taxable years or your holding period for the Class A Ordinary Shares will be treated as an excess distribution. Under these special tax rules:

● the excess distribution or gain will be allocated ratably over your holding period for the Class A Ordinary Shares;

● the amount allocated to your current taxable year, and any amount allocated to any of your taxable year(s) prior to the first taxable year in which we were a PFIC, will be treated as ordinary income, and

● the amount allocated to each of your other taxable year(s) will be subject to the highest tax rate in effect for that year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year.

The tax liability for amounts allocated to years prior to the year of disposition or "excess distribution" cannot be offset by any net operating losses for such years, and gains (but not losses) realized on the sale of the Class A Ordinary shares cannot be treated as capital, even if you hold the Class A Ordinary Shares as capital assets.

A U.S. Holder of "marketable stock" (as defined below) in a PFIC may make a mark-to-market election under Section 1296 of the US Internal Revenue Code for such stock to elect out of the tax treatment discussed above. If you make a mark-to-market election for first taxable year which you hold (or are deemed to hold) Class A Ordinary Shares and for which we are determined to be a PFIC, you will include in your income each year an amount equal to the excess, if any, of the fair market value of the Class A Ordinary Shares as of the close of such taxable year over your adjusted basis in such Class A Ordinary Shares, which excess will be treated as ordinary income and not capital gain. You are allowed an ordinary loss for the excess, if any, of the adjusted basis of the Class A Ordinary Shares over their fair market value as of the close of the taxable year. Such ordinary loss, however, is allowable only to the extent of any net mark-to-market gains on the Class A Ordinary Shares included in your income for prior taxable years. Amounts included in your income under a mark-to-market election, as well as gain on the actual sale or other disposition of the Ordinary Class A Shares, are treated as ordinary income. Ordinary loss treatment also applies to any loss realized on the actual sale or disposition of the Class A Ordinary Shares, to the extent that the amount of such loss does not exceed the net mark-to-market gains previously included for such Class A Ordinary Shares. Your basis in the Class A Ordinary Shares will be adjusted to reflect any such income or loss amounts. If you make a valid mark-to-market election, the tax rules that apply to distributions by corporations which are not PFICs would apply to distributions by us, except that the lower applicable capital gains rate for qualified dividend income discussed below under "— Taxation of Dividends and Other Distributions on our Class A Ordinary Shares" generally would not apply.

The mark-to-market election is available only for "marketable stock," which is stock that is traded in other than de minimis quantities on at least 15 days during each calendar quarter ("regularly traded") on a qualified exchange or other market (as defined in applicable U.S. Treasury regulations), including Nasdaq. If the Class A Ordinary Shares are regularly traded on Nasdaq and if you are a holder of Class A Ordinary shares, the mark-to-market election would be available to you were we to be or become a PFIC.

Alternatively, a U.S. Holder of stock in a PFIC may make a "qualified electing fund" election under Section 1295(b) of the US Internal Revenue Code with respect to such PFIC to elect out of the tax treatment discussed above. A U.S. Holder who makes a valid qualified electing fund election with respect to a PFIC will generally include in gross income for a taxable year such holder's pro rata share of the corporation's earnings and profits for the taxable year. The qualified electing fund election, however, is available only if such PFIC provides such U.S. Holder with certain information regarding its earnings and profits as required under applicable U.S. Treasury regulations. We do not currently intend to prepare or provide the information that would enable you to make a qualified electing fund election. If you hold Class A Ordinary Shares in any taxable year in which we are a PFIC, you will be required to file U.S. Internal Revenue Service Form 8621 in each such year and provide certain annual information regarding such Class A Ordinary Shares, including regarding distributions received on the Class A Ordinary Shares and any gain realized on the disposition of the Class A Ordinary Shares.

If you do not make a timely "mark-to-market" election (as described above), and if we were a PFIC at any time during the period you hold our Class A Ordinary Shares, then such Class A Ordinary Shares will continue to be treated as stock of a PFIC with respect to you even if we cease to be a PFIC in a future year, unless you make a "purging election" for the year we cease to be a PFIC. A "purging election" creates a deemed sale of such Class A Ordinary Shares at their fair market value on the last day of the last year in which we are treated as a PFIC. The gain recognized by the purging election will be subject to the special tax and interest charge rules treating the gain as an excess distribution, as described above. As a result of the purging election, you will have a new basis (equal to the fair market value of the Class A Ordinary Shares on the last day of the last year in which we are treated as a PFIC) and holding period (which new holding period will begin the day after such last day) in your Class A Ordinary Shares for tax purposes.

IRC Section 1014(a) provides for a step-up in basis to the fair market value for our Class A Ordinary Shares when inherited from a decedent that was previously a holder of our Class A Ordinary Shares. However, if we are determined to be a PFIC and a decedent that was a U.S. Holder did not make either a timely qualified electing fund election for our first taxable year as a PFIC in which the U.S. Holder held (or was deemed to hold) our Class A Ordinary Shares, or a mark-to-market election and ownership of those Class A Ordinary Shares are inherited, a special provision in IRC Section 1291(e) provides that the new U.S. Holder's basis should be reduced by an amount equal to the Section 1014 basis minus the decedent's adjusted basis just before death. As such if we are determined to be a PFIC at any time prior to a decedent's passing, the PFIC rules will cause any new U.S. Holder that inherits our Class A Ordinary Shares from a U.S. Holder to not get a step-up in basis under Section 1014 and instead will receive a carryover basis in those Class A Ordinary Shares.

You are urged to consult your tax advisors regarding the application of the PFIC rules to your investment in our Class A Ordinary Shares and the elections discussed above.

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***Taxation of Dividends and Other Distributions on our Class A Ordinary Shares***

Subject to the PFIC rules discussed above, the gross amount of distributions made by us to you with respect to the Class A Ordinary Shares (including the amount of any taxes withheld therefrom) will generally be includable in your gross income as dividend income on the date of receipt by you, but only to the extent that the distribution is paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). With respect to corporate U.S. Holders, the dividends will not be eligible for the dividends-received deduction allowed to corporations in respect of dividends received from other U.S. corporations.

With respect to non-corporate U.S. Holders, including individual U.S. Holders, dividends will be taxed at the lower capital gains rate applicable to qualified dividend income, provided that (1) the Class A Ordinary Shares are readily tradable on an established securities market in the United States, or we are eligible for the benefits of an approved qualifying income tax treaty with the United States that includes an exchange of information program, (2) we are not a PFIC for either our taxable year in which the dividend is paid or the preceding taxable year, and (3) certain holding period requirements are met. Because there is not income tax treaty between the United States and the Cayman Islands, clause (1) above can be satisfied only if the Class A Ordinary Shares are readily tradable on an established securities market in the United States. Under U.S. Internal Revenue Service authority, Class A Ordinary Shares are considered for purpose of clause (1) above to be readily tradable on an established securities market in the United States if they are listed on certain exchanges, which presently include the NYSE and the Nasdaq Stock Market. You are urged to consult your tax advisors regarding the availability of the lower rate for dividends paid with respect to our Class A Ordinary Shares, including the effects of any change in law after the date of this prospectus.

Dividends will constitute foreign source income for foreign tax credit limitation purposes. If the dividends are taxed as qualified dividend income (as discussed above), the amount of the dividend taken into account for purposes of calculating the foreign tax credit limitation will be limited to the gross amount of the dividend, multiplied by the reduced rate divided by the highest rate of tax normally applicable to dividends. The limitation on foreign taxes eligible for credit is calculated separately with respect to specific classes of income. For this purpose, dividends distributed by us with respect to our Class A Ordinary Shares will constitute "passive category income" but could, in the case of certain U.S. Holders, constitute "general category income."

To the extent that the amount of the distribution exceeds our current and accumulated earnings and profits (as determined under U.S. federal income tax principles), it will be treated first as a tax-free return of your tax basis in your Class A Ordinary Shares, and to the extent the amount of the distribution exceeds your tax basis, the excess will be taxed as capital gain. We do not intend to calculate our earnings and profits under U.S. federal income tax principles. Therefore, a U.S. Holder should expect that a distribution will be treated as a dividend even if that distribution would otherwise be treated as a non-taxable return of capital or as capital gain under the rules described above.

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***Taxation of Dispositions of Class A Ordinary Shares***

Subject to the passive foreign investment company rules discussed above, you will recognize taxable gain or loss on any sale, exchange or other taxable disposition of a share equal to the difference between the amount realized (in U.S. dollars) for the share and your tax basis (in U.S. dollars) in the Class A Ordinary Shares. The gain or loss will be capital gain or loss. If you are a non-corporate U.S. Holder, including an individual U.S. Holder, who has held the Class A Ordinary Shares for more than one year, you will generally be eligible for reduced tax rates. The deductibility of capital losses is subject to limitations. Any such gain or loss that you recognize will generally be treated as United States source income or loss for foreign tax credit limitation purposes which will generally limit the availability of foreign tax credits.

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***Information Reporting and Backup Withholding***

Dividend payments with respect to our Class A Ordinary Shares and proceeds from the sale, exchange or redemption of our Class A Ordinary Shares may be subject to information reporting to the U.S. Internal Revenue Service and possible U.S. backup withholding under Section 3406 of the US Internal Revenue Code with at a current flat rate of 24%. Backup withholding will not apply, however, to a U.S. Holder who furnishes a correct taxpayer identification number and makes any other required certification on U.S. Internal Revenue Service Form W-9 or who is otherwise exempt from backup withholding. U.S. Holders who are required to establish their exempt status generally must provide such certification on U.S. Internal Revenue Service Form W-9. U.S. Holders are urged to consult their tax advisors regarding the application of the U.S. information reporting and backup withholding rules.

Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against your U.S. federal income tax liability, and you may obtain a refund of any excess amounts withheld under the backup withholding rules by filing the appropriate claim for refund with the U.S. Internal Revenue Service and furnishing any required information. We do not intend to withhold taxes for individual shareholders. Transactions effected through certain brokers or other intermediaries, however, may be subject to withholding taxes (including backup withholding), and such brokers or intermediaries may be required by law to withhold such taxes.

Under the Hiring Incentives to Restore Employment Act of 2010, certain U.S. Holders are required to report information relating to our Class A Ordinary Shares, subject to certain exceptions (including an exception for Class A Ordinary Shares held in accounts maintained by certain financial institutions), by attaching a complete Internal Revenue Service Form 8938, Statement of Specified Foreign Financial Assets, with their tax return for each year in which they hold Class A Ordinary Shares.

**UNDERWRITING**

We are offering the securities described in this prospectus through the underwriters listed below. Maxim Group LLC, the Representative, is acting as the book running manager of the offering. We have entered into an underwriting agreement, dated as of [\*], 2026, with the underwriters. Subject to the terms and conditions of the underwriting agreement, each underwriter has severally agreed to purchase the number of securities set forth opposite its name below:

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| | | |
|:---|:---|:---|
| **Underwriter** | **Number of Units<br> Consisting of One Class A Ordinary<br> Share and<br> One Warrant** | **Number of Units<br> Consisting of<br> One Pre-funded<br> Warrant and<br> One Warrant** |
| Maxim Group LLC |  |  |
| **TOTAL** |  |  |

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The underwriters have agreed to purchase all of the securities offered by this prospectus (other than those covered by the over-allotment option described below). The underwriters reserve the right to withdraw, cancel, or modify offers to the public and to reject orders in whole or in part.

The securities offered hereby should be ready for delivery on or about [\*], 2026, against payment in immediately available funds.

The underwriters are offering the securities subject to various conditions and may reject all or part of any order. The Representative has advised us that the underwriters propose to offer our securities directly to the public at the public offering price that appears on the cover page of this prospectus. In addition, the underwriters may offer some of the securities to other securities dealers at such price less a concession of up to $[\*] per Class A Ordinary Share or $[\*] per Warrant. After the securities are released for sale to the public, the underwriters may change the offering price and other selling terms at various times.

**Discretionary Accounts**

The underwriters do not intend to confirm sales of the securities offered hereby to any accounts over which they have discretionary authority.

**Over-Allotment Option**

We have granted the underwriters an over-allotment option. This option, which is exercisable for up to forty-five (45) days after the date of this prospectus, permits the underwriters to purchase a maximum of 1,363,636 additional Class A Ordinary Shares and/or 1,363,636 additional Warrants to purchase Class A Ordinary Shares. The option may be used to purchase such Class A Ordinary Shares and/or Warrants, or any combination thereof, as determined by the underwriters. If the underwriters exercise all or part of this option, they will purchase securities covered by the option at the public offering price that appears on the cover page of this prospectus, less underwriting discounts and commissions.

**Discounts and Commissions**

The following table provides information regarding the amount of the discounts and commissions to be paid to the underwriters by us, before expenses, assuming both no exercise and full exercise of the over-allotment option and does not include the fees and expenses of the Representative:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Per Unit Consisting of One Class A Ordinary Share and One Warrant** | **Per Unit Consisting of One Pre-funded Warrant and One Warrant** | **Assuming No Exercise of<br> Over-Allotment<br> Option** | **Assuming Full Exercise of<br> Over-Allotment<br> Option** |
| Public offering price |  |  |  |  |
| Underwriting discounts and commissions (7%) |  |  |  |  |
| Proceeds, before expenses, to us |  |  |  |  |

---

In addition to the above, we will reimburse the Representative for certain of its accountable and out-of-pocket expenses incurred in connection with this offering, including the Representative's legal fees, and actual travel and reasonable out-of-pocket expenses, in an amount not to exceed $100,000. If this offering is not completed, we have agreed to reimburse the Representative for its actual expenses in an amount not to exceed $25,000.

We estimate that the total expenses of the offering payable by us, including registration and filing fees, printing fees and legal and accounting expenses, but excluding the Representative fees above, will be approximately $0.35 million. This figure includes, among other things, the Representative's expenses (including the fees, costs, and expenses for the Representative's legal counsel) that we have agreed to reimburse.

**Indemnification**

We have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act, and liabilities arising from breaches of representations and warranties contained in the underwriting agreement, or to contribute to payments that the underwriters may be required to make in respect of those liabilities.

**Lock-Up Agreements**

The Company has agreed that for a period of ten (10) days from the closing of this offering, that neither the Company nor any subsidiary may, without the prior written consent of the Representative (i) issue, enter into any agreement to issue, or announce the issuance or proposed issuance of any Class A Ordinary Shares or Class A Ordinary Share equivalents; or (ii) file any registration statement or prospectus, or any amendment or supplement thereto, subject to certain conditions and exceptions.

The Company's directors and officers and certain shareholders shall enter into customary "lock-up" agreements in favor of the Representative pursuant to which such persons and entities shall agree, for a period of sixty (60) days after the closing of this offering, that they shall neither offer, issue, sell, contract to sell, encumber, grant any option for the sale of or otherwise dispose of any securities of the Company without the Representative's prior written consent, subject to certain conditions and exceptions.

**Right of First Refusal**

We have agreed to grant the Representative for the six month period following the closing of this offering, a right of first refusal to act as sole managing underwriter and sole book runner, sole placement agent or sole sales agent, for any and all future public or private equity, equity-linked or debt (excluding commercial bank debt) offerings for which the Company retains the service of an underwriter, agent, advisor, finder or other person or entity in connection with such offering, subject to certain conditions and exceptions.

**Other Rights**

If within twelve (12) months following the closing of this offering, we complete any financing of equity, equity-linked, convertible or debt or other capital raising activity with, or receives any proceeds from, any investors contacted or introduced by the Representative during the Representative's engagement, then we will compensate the Representative upon the closing of such financing in the manner provided in this offering.

**Stabilization**

SEC rules may limit the ability of the underwriters to bid for or purchase shares before the distribution of the shares is completed. However, the underwriters may engage in the following activities in accordance with the rules:

● *Stabilizing transactions* — The underwriters may make bids or purchases for the purpose of pegging, fixing, or maintaining the price of the shares, so long as stabilizing bids do not exceed a specified maximum.

● *Over-allotments and syndicate covering transactions* — The underwriters may sell more Class A Ordinary Shares in connection with this offering than the number of shares than they have committed to purchase. This over-allotment creates a short position for the underwriters. This short sales position may involve either "covered" short sales or "naked" short sales. Covered short sales are short sales made in an amount not greater than the underwriters' over-allotment option to purchase additional shares in this offering described above. The underwriters may close out any covered short position either by exercising the over-allotment option or by purchasing shares in the open market. To determine how they will close the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market, as compared to the price at which they may purchase shares through the over-allotment option. Naked short sales are short sales in excess of the over-allotment option. The underwriters must close out any naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that, in the open market after pricing, there may be downward pressure on the price of the shares that could adversely affect investors who purchase shares in this offering.

● *Penalty bids* — If the representative purchases shares in the open market in a stabilizing transaction or syndicate covering transaction, it may reclaim a selling concession from the underwriters and selling group members who sold those shares as part of this offering.

● *Passive market making* — Market makers in the shares who are underwriters or prospective underwriters may make bids for or purchases of shares, subject to limitations, until the time, if ever, at which a stabilizing bid is made.

Similar to other purchase transactions, the underwriters' purchases to cover the syndicate short sales or to stabilize the market price of our Class A Ordinary Shares may have the effect of raising or maintaining the market price of our Class A Ordinary Shares or preventing or mitigating a decline in the market price of our Class A Ordinary Shares. As a result, the price of the Class A Ordinary Shares may be higher than the price that might otherwise exist in the open market. The imposition of a penalty bid might also have an effect on the price of the shares if it discourages resales of the shares.

**Transfer Agent and Registrar**

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

**Listing**

Our Class A Ordinary Shares are listed on The Nasdaq Capital Market under the symbol "UCAR."

**Determination of Offering Price**

The actual public offering price of the securities we are offering will be negotiated between us, the underwriters, and the investors in the offering based on the trading of our Class A Ordinary Shares prior to the offering, among other things. Other factors considered in determining the public offering price of the securities we are offering include our history and prospects, the stage of development of our business, our business plans for the future and the extent to which they have been implemented, an assessment of our management, the general conditions of the securities markets at the time of the offering and such other factors as were deemed relevant. The actual public offering price per Unit to investors in this offering will be equal to the Nasdaq Official Closing Price of our Class A Ordinary Shares immediately preceding the effectiveness of the registration statement of which this prospectus forms a part.

**Electronic Offer, Sale and Distribution of Securities**

A prospectus in electronic format may be made available on a website maintained by the underwriters. In connection with the offering, the underwriters or selected dealers may distribute prospectuses electronically. No forms of electronic prospectus other than prospectuses that are printable as Adobe® PDF will be used in connection with this offering.

Other than the prospectus in electronic format, the information on the underwriters' website and any information contained in any other website maintained by the underwriters is not part of the prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or the underwriters in their capacity as underwriter and should not be relied upon by investors.

**Certain Relationships**

The underwriters and certain of their affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage activities. The underwriters and certain of their affiliates may in the future perform, various commercial and investment banking and financial advisory services for us, for which they will receive customary fees and expenses. The Representative acted as the placement agent in connection with our private placement offering consummated in December 2025 in which it received compensation.

**Selling Restrictions**

Other than in the United States, no action has been taken by us or the underwriters that would permit a public offering of the securities offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published, in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to this offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.

No invitation, whether directly or indirectly, may be made to the public in the Cayman Islands to subscribe for our securities.

 ****

**SERVICE OF PROCESS AND ENFORCEMENT OF CIVIL LIABILITIES**

We are incorporated under the laws of the Cayman Islands as an exempted company with limited liability. We are incorporated in the Cayman Islands in order to enjoy the following benefits:

● political and economic stability;

● an effective judicial system;

● a favorable tax system;

● the absence of exchange control or currency restrictions; and

● the availability of professional and support services.

However, certain disadvantages accompany incorporation in the Cayman Islands. These disadvantages include:

● the Cayman Islands has a less exhaustive body of securities laws than the United States and these securities laws provide significantly less protection to investors; and

● Cayman Islands companies may not have standing to sue before the federal courts of the United States.

Our memorandum and articles of association do not contain provisions requiring that disputes, including those arising under the securities laws of the United States, among us, our officers, directors and shareholders, be arbitrated.

We conduct a substantial amount of our operations in China, and a substantial amount of our assets are located in China. A majority our officers are nationals or residents of jurisdictions other than the United States and a substantial portion of their assets are located outside the United States. As a result, it may be difficult or impossible for a shareholder to effect service of process within the United States upon us or these persons, or to enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States. It may also be difficult for shareholder to enforce judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities laws against us and our executive officers and directors.

We have appointed Cogency Global Inc. located at 122 East 42nd St 18th Floor, New York, New York 10168, as our agent upon whom process may be served in any action brought against us under the securities laws of the United States.

Maples and Calder (Hong Kong) LLP, our counsel as to Cayman Islands law, has advised us that the courts in the Cayman Islands are unlikely (i) to recognize or enforce judgments of United States courts obtained against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States, so far as the liabilities imposed by those provisions are penal in nature.

Maples and Calder (Hong Kong) LLP has informed us that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States, the courts of the Cayman Islands will recognize and enforce a foreign money judgement of a foreign court of competent jurisdiction without any retrial on the merits based on the principal that a judgement of a competent foreign court imposes upon the judgement debtor an obligation to pay the sum for which such judgment has been given, provided such judgment (a) is final and conclusive and for a liquidated sum; (b) is not in respect of taxes, a fine or a penalty; (c) is not inconsistent with a Cayman Islands judgment in respect of the same matter; (d) is not impeachable on the grounds of fraud; or (e) was not obtained in a manner and is not of a kind the enforcement of which is contrary to the natural justice or the public policy of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy). A Cayman Islands court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.

Guantao Law Firm, our counsel as to PRC law, has advised us that there is uncertainty as to whether PRC courts would (i) recognize or enforce judgments of United States courts obtained against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States, or (ii) entertain original actions brought in each respective jurisdiction against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States.

Guantao Law Firm has further advised us that the PRC Civil Procedures Law governs the recognition and enforcement of foreign judgments. PRC courts may recognize and enforce foreign judgments in accordance with the PRC Civil Procedures Law based either on treaties between China and the country where the judgment is made or on principles of reciprocity between jurisdictions.

The PRC does not have any treaties or other agreements with the United States or the Cayman Islands that provide for the reciprocal recognition and enforcement of foreign judgments. In addition, according to the PRC Civil Procedures Law, courts in the PRC will not enforce a foreign judgment against us or our directors and officers if they determine that the judgment violates the basic principles of PRC law or national sovereignty, security or public interest. As a result, it is uncertain whether a PRC court would enforce a judgment rendered by a court in the United States or the Cayman Islands. Under the PRC Civil Procedures Law, foreign shareholders may originate actions based on PRC law against us in the PRC, if they can establish sufficient nexus to the PRC for a PRC court to have jurisdiction, and meet other procedural requirements, including, among others, the plaintiff must have a direct interest in the case, and there must be a concrete claim, a factual basis and a cause for the suit.

In addition, it will be difficult for U.S. shareholders to originate actions against us in China in accordance with PRC laws because we are incorporated under the laws of the Cayman Islands and it will be difficult for U.S. shareholders, by virtue only of holding our Ordinary Shares, to establish a connection to China for a PRC court to have jurisdiction as required under the PRC Civil Procedures Law.

**EXPENSES RELATING TO THIS OFFERING**

Set forth below is an itemization of the total expenses, excluding underwriting discounts and commissions, expected to be incurred in connection with the offer and sale of our securities. Except for the SEC registration fee, all amounts are estimates.

---

| | |
|:---|:---|
| SEC Registration Fee | $1906 |
| FINRA Filing Fee | $2570 |
| Accounting fees and expenses | $100000 |
| Legal Fees and Expenses | $240000 |
| Miscellaneous Expenses | $8689 |
| **Total** | $353165 |

---

**LEGAL MATTERS**

We are being represented by Hunter Taubman Fischer & Li LLC with respect to certain legal matters as to United States federal securities and New York State law. The validity of the Class A Ordinary Shares included in the Units, offered in this offering and certain other legal matters as to Cayman Islands law will be passed upon for us by Maples and Calder (Hong Kong) LLP, our counsel as to Cayman Islands law. Legal matters as to PRC law will be passed upon for us by Guantao Law Firm. Certain legal matters with respect to the United States federal securities and New York law in connection with this offering will be passed upon for the underwriters by Ellenoff Grossman & Schole LLP.

**EXPERTS**

The consolidated financial statements for the fiscal years ended December 31, 2024 and 2023 included in this Registration Statement have been so incorporated in reliance on the report of Onestop Assurance PAC, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting. The office of Onestop Assurance PAC is located at 10 Anson Road, #13-09 International Plaza, Singapore 079903.

**WHERE YOU CAN FIND ADDITIONAL INFORMATION**

We have filed with the SEC a registration statement on Form F-1 under the Securities Act, including relevant exhibits and schedules, under the Securities Act with respect to the securities offered by this prospectus. For the purposes of this section, the term registration statement on Form F-1 means the original registration statement on Form F-1 and any and all amendments including the schedules and exhibits to the original registration statement or any amendment. This prospectus, which constitutes a part of the registration statement, does not contain all of the information contained in the registration statement. Each statement made in this prospectus concerning a document filed as an exhibit to the registration statement on Form F-1 is qualified by reference to that exhibit for a complete statement of its provisions. You should read the registration statement on Form F-1 and its exhibits and schedules for further information with respect to us and the securities offered hereby.

We are required to file reports, including annual reports on Form 20-F, and other information with the SEC. The SEC maintains a website that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. The address of the website is www.sec.gov. Additionally, we will make these filings available, free of charge, on our website at http://www.upincar.com/ as soon as reasonably practicable after we electronically file such materials with, or furnish them to, the SEC. The information on our website, other than these filings, is not, and should not be, considered part of this prospectus and is not incorporated by reference into this document.

As a foreign private issuer, we will be exempt from the rules of the Exchange Act prescribing the furnishing and content of proxy statements to shareholders, and our executive officers, directors, and principal shareholders are exempt from the short-swing profit recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act.

**INDEX TO THE CONSOLIDATED FINANCIAL STATEMENTS OF**

**U POWER LIMITED**

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| | |
|:---|:---|
| [CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2022, 2023 AND 2024](#f_001) | F-3 |
| [CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS FOR THE YEARS ENDED DECEMBER 31, 2022, 2023 AND 2024](#f_002) | F-4 |
| [CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 2022, 2023 AND 2024](#f_003) | F-5 |
| [CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2022, 2023 AND 2024](#f_004) | F-6 |
| [NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS](#f_005) | F-7 |

---

---

| | |
|:---|:---|
| [UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS AS OF JUNE 30, 2024 AND 2025](#U_001) | F-42 |
| [UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2025](#U_002) | F-43 |
| [UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2025](#U_003) | F-44 |
| [UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 2024 AND 2025](#U_004) | F-45 |
| [NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS](#U_005) | F-46 |

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**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Board of Directors and<br> Shareholders of U Power Limited

**Opinion on the Financial Statements**

We have audited the accompanying consolidated balance sheets of U Power Limited and Subsidiaries (collectively, the "Company") as of December 31, 2022, 2023 and 2024, and the related consolidated statements of comprehensive income, shareholders' equity, and cash flows for each of the years in the three year period ended December 31 2024, and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022, 2023 and 2024, and the result of its operations and its cash flows for each of the years in the three year period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

**Basis for Opinion**

These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's consolidated 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 consolidated 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 consolidated 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 consolidated 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 consolidated financial statements. We believe that our audits provides a reasonable basis for our opinion.

/s/ Onestop Assurance PAC

We have served as the Company's auditor since 2023.

Singapore

May 15, 2025

**U POWER LIMITED**

**CONSOLIDATED BALANCE SHEETS**

**(Amounts in thousands of RMB and US$, except for number of shares)**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  |<br>**Notes** | **2022** | **2023** | **2024** | **2024** |
|  | | **RMB** | **RMB** | **RMB** | **US$** |
| **ASSETS** |  |  |  |  |  |
| **Current assets:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents |  | 4881 | 1927 | 23435 | 3211 |
| &nbsp;&nbsp;&nbsp;Restricted cash |  | 1027 | 34312 | 1239 | 170 |
| &nbsp;&nbsp;&nbsp;Accounts receivable | 5 | 1617 | 15748 | 10374 | 1421 |
| &nbsp;&nbsp;&nbsp;Inventories | 6 | 5457 | 5439 | 9872 | 1352 |
| &nbsp;&nbsp;&nbsp;Advance to suppliers | 7 | 6993 | 10816 | 9466 | 1297 |
| &nbsp;&nbsp;&nbsp;Other current assets | 8 | 33917 | 94813 | 29032 | 3977 |
| &nbsp;&nbsp;&nbsp;Amount due from related parties | 17 | 120 | 142 | 21657 | 2967 |
| **Total current assets** |  | **54012** | **163197** | **105075** | **14395** |
| **Non-current assets:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Property, plant and equipment, net | 9 | 16282 | 11764 | 8656 | 1186 |
| &nbsp;&nbsp;&nbsp;Intangible assets, net | 10 | 286 | 201 | 132 | 18 |
| &nbsp;&nbsp;&nbsp;Operating lease right-of-use assets, net | 15 | 19250 | 21656 | 16205 | 2220 |
| &nbsp;&nbsp;&nbsp;Long-term investments | 11 | 111811 | 123367 | 134114 | 18374 |
| &nbsp;&nbsp;&nbsp;Refundable deposit for investment | 12 | 80183 | 72774 | 39799 | 5452 |
| &nbsp;&nbsp;&nbsp;Other non-current assets | 8 | 30 | 36029 | 81733 | 11198 |
| **Total non-current assets** |  | **227842** | **265791** | **280639** | **38448** |
| **Total assets** |  | **281854** | **428988** | **385714** | **52843** |
| **LIABILITIES AND EQUITY** |  |  |  |  |  |
| **Current liabilities:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Bank borrowings | 13 |  | 14500 | 17972 | 2462 |
| &nbsp;&nbsp;&nbsp;Loan payables | 16 | 6500 |  |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payable |  | 11130 | 10231 | 14307 | 1960 |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other liabilities | 14 | 33735 | 35231 | 13281 | 1819 |
| &nbsp;&nbsp;&nbsp;Income tax payables | 19 | 2580 | 5201 | 5169 | 708 |
| &nbsp;&nbsp;&nbsp;Advances from customers |  | 3258 | 2537 | 1086 | 149 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities – current | 15 | 1696 | 1750 | 1843 | 252 |
| &nbsp;&nbsp;&nbsp;Amount due to related parties | 17 | 251 | 5431 | 3239 | 444 |
| **Total current liabilities** |  | **59150** | **74881** | **56897** | **7794** |
| **Non-current liabilities:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities – non-current | 15 | 4789 | 5980 | 4137 | 567 |
| &nbsp;&nbsp;&nbsp;Bank borrowings | 13 | 10000 | - | 3700 | 507 |
| **Total non-current liabilities** |  | **14789** | **5980** | **7837** | **1074** |
| **Total liabilities** |  | **73939** | **80861** | **64734** | **8868** |
| **Commitments and contingencies** | 22 | 2900 | 3507 |  |  |
| **Shareholders' equity:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Ordinary shares (US$0.0000001 par value; 500,000,000,000 shares authorized; 500,000 and 1,243,140 issued and outstanding as of December 31, 2022 and 2023, respectively) \* |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Class A Ordinary Shares, $0.00001 par value, 3,999,411,812 Class A Ordinary Shares authorized, 2,790,000 Class A Ordinary Shares issued and outstanding as of December 31, 2024 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Class B Ordinary Shares, $0.00001 par value, 1,000,588,188 Class B Ordinary Shares authorized, 588,188 Class B Ordinary Shares issued and outstanding as of December 31, 2024 |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital |  | 319775 | 479400 | 512568 | 70222 |
| &nbsp;&nbsp;&nbsp;Translation reserve |  |  | 446 |  |  |
| &nbsp;&nbsp;&nbsp;Accumulated deficit |  | (153838) | (173176) | (221098) | (30290) |
| **Total U POWER LIMITED's shareholders' equity** |  | **165937** | **306670** | **291470** | **39932** |
| Non-controlling interests |  | 39078 | 37950 | 29510 | 4043 |
| **Total equity** |  | **205015** | **344620** | **320980** | **43975** |
| **Total liabilities and equity** |  | **281854** | **428988** | **385714** | **52843** |

---

\* On March 25, 2024, the Company issued an aggregate of every 100 Ordinary Shares with a par value of US$0.0000001 each in the Company's issued and unissued share capital be consolidated into one Ordinary Share with a par value of US$0.00001 each, so that immediately following the Share Consolidation, the authorizsed share capital of the Company shall be changed. During fiscal year 2024, the Company had issued 213,504,800 Ordinary Shares. As a result of the Share Consolidation, upon the Effective Date, there will be approximately 3,378,188 as of December 31, 2024..

The accompanying notes are an integral part of these consolidated financial statements.

**U POWER LIMITED**

**CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS**

**(Amounts in thousands of RMB and US$, except for number of shares and per share data)**

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | | **For the years ended December 31,** | **For the years ended December 31,** | **For the years ended December 31,** | **For the years ended December 31,** | **For the years ended December 31,** |
|  | <br>**Notes** | **2021** | **2022** | **2023** | **2024** | **2024** |
|  |  | **RMB** | **RMB** | **RMB** | **RMB** | **US$** |
| **Net revenue** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Product sales |  | 6616 | 3061 | 17062 | 41819 | 5729 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sourcing services |  | 1394 | 4428 | 1513 | 63 | 9 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Battery-swapping services |  | - | 307 | 1189 | 2408 | 330 |
| &nbsp;&nbsp;&nbsp;**Total net revenue** |  | **8010** | **7796** | **19764** | **44290** | 6068 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cost of revenue |  | (5137) | (5137) | (7592) | (33827) | (4634) |
| &nbsp;&nbsp;&nbsp;**Gross profit** |  | **2873** | **2659** | **12172** | **10463** | 1434 |
| &nbsp;&nbsp;&nbsp;**Operating expenses:** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Sales and marketing expenses |  | (4862) | (2041) | (2477) | (2789) | (382) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;General and administrative expenses |  | (37588) | (37714) | (41222) | (46910) | (6427) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Research and development expenses |  | (5374) | (9352) | (2184) | (2985) | (409) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on impairment of long-lived assets and long-term investment |  |  |  | (1996) | (10504) | (1439) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for doubtful accounts |  | - | (9801) | (1196) | (5264) | (721) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total operating expenses** |  | **(47824)** | **(58908)** | **(49075)** | **(68452)** | (9378) |
| &nbsp;&nbsp;&nbsp;**Operating loss** |  | **(44951)** | **(56249)** | **(36903)** | **(57989)** | (7944) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest income |  | 437 | 49 | 562 | 742 | 102 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest expenses |  | (696) | (764) | (1860) | (1402) | (192) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other income |  | 3026 | 3206 | 16927 | 5612 | 769 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other expenses |  | (4298) | (3904) | (1579) | (3325) | (456) |
| &nbsp;&nbsp;&nbsp;**Loss before income taxes** |  | **(46482)** | **(57662)** | **(22853)** | **(56362)** | (7721) |
| &nbsp;&nbsp;&nbsp;Income tax expenses | 19 | (2582) | (5) | (2613) | - | - |
| &nbsp;&nbsp;&nbsp;**Net loss** |  | **(49064)** | **(57667)** | **(25466)** | **(56362)** | (7721) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less: Net loss attributable to non-controlling interests |  | (7665) | (11746) | (6128) | (8440) | (1156) |
| &nbsp;&nbsp;&nbsp;**Net loss attributable to the Company's shareholders** |  | **(41399)** | **(45921)** | **(19338)** | **(47922)** | (6565) |
| &nbsp;&nbsp;&nbsp;**Loss per share attributable to ordinary shareholders of the Company's shareholders \*** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic and diluted | 21 | (82.80) | (91.84) | (15.56) | (16.79) | (2.30) |
| &nbsp;&nbsp;&nbsp;**Weighted average shares used in calculating basic and diluted loss per share \*** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted | 21 | 500000 | 500000 | 1243140 | 2854594 | 2854594 |
| &nbsp;&nbsp;&nbsp;**Net loss** |  | **(49064)** | **(57667)** | **(25466)** | **(56362)** | (7721) |
| &nbsp;&nbsp;&nbsp;**Other comprehensive income, net of tax of nil:** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Foreign currency translation adjustments |  | - | - | 446 | (446) | (61) |
| &nbsp;&nbsp;&nbsp;**Comprehensive loss** |  | **(49064)** | **(57667)** | **(25020)** | **(56808)** | (7782) |

---

\* On March 25, 2024, the Company issued an aggregate of every 100 Ordinary Shares with a par value of US$0.0000001 each in the Company's issued and unissued share capital be consolidated into one Ordinary Share with a par value of US$0.00001 each, so that immediately following the Share Consolidation, the authorizsed share capital of the Company shall be changed. During fiscal year 2024, the Company had issued 213,504,800 Ordinary Shares. As a result of the Share Consolidation, upon the Effective Date, there will be approximately 3,378,188 as of December 31, 2024.

The accompanying notes are an integral part of these consolidated financial statements.

**U POWER LIMITED**

**CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY**

**(Amounts in thousands of RMB and US$, except for number of shares)**

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Class A** | **Class A** | **Class B** | **Class B** | | | | | | |
|  | **Ordinary shares** | **Ordinary shares** | **Ordinary shares** | **Ordinary shares** | | | | | | |
|  | **Shares \*** | **Amount** | **shares\*** | **Amount** |<br>**Additional**<br>**paid-in**<br>**capital** |<br>**Accumulated**<br>**deficit** |<br>**Translation**<br>**reserve** | **Total**<br>**U POWER LIMITED**<br>**shareholders'**<br>**equity** |<br>**Non-**<br>**controlling**<br>**interests** |<br>**Total**<br> **equity** |
|  | | **RMB** | | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** |
| **Balance as of December 31, 2021** | **500000** |  | **-** |  | **319775** | **(107917)** | **-** | **211858** | **45824** | **257682** |
| Consolidated net loss |  |  |  |  |  | (45921) |  | (45921) | (11746) | (57667) |
| Capital contribution | - |  | - |  | - | - | - | - | 5000 | 5000 |
| **Balance as of December 31, 2022** | **500000** |  | **-** |  | **319775** | **(153838)** | **-** | **165937** | **39078** | **205015** |
| Consolidated net loss |  |  |  |  |  | (19338) |  | (19338) | (6128) | (25466) |
| Issuance of ordinary shares | 743140 |  | 743140 |  | 159625 |  |  | 159625 |  | 159625 |
| Capital contribution from non-controlling shareholders |  |  |  |  |  |  |  |  | 5000 | 5000 |
| Other comprehensive income | - |  | - |  | - | - | 446 | 446 | - | 446 |
| **Balance as of December 31, 2023** | **1243140** |  | **-** |  | **479400** | **(173176)** | **446** | **306670** | **37950** | **344620** |
| Consolidated net loss |  |  |  |  |  | (47922) |  | (47922) | (8440) | (56362) |
| Issuance of ordinary shares | 1546860 |  | 588188 |  | 49276 |  |  | 49276 |  | 49276 |
| Investment Refund |  |  |  |  | (16108) |  |  | (16108) |  | (16108) |
| Other comprehensive income |  |  |  |  |  |  | (446) | (446) |  | (446) |
| **Balance as of December 31, 2024 in RMB** | **2790000** |  | **588188** |  | **512568** | **(221098)** | **-** | **291470** | **29510** | **320980** |
| **Balance as of December 31, 2024 in US$** |  |  |  |  | **70222** | **(30290)** | **-** | **39932** | **4043** | **43975** |

---

\* On March 25, 2024, the Company issued an aggregate of every 100 Ordinary Shares with a par value of US$0.0000001 each in the Company's issued and unissued share capital be consolidated into one Ordinary Share with a par value of US$0.00001 each, so that immediately following the Share Consolidation, the authorizsed share capital of the Company shall be changed. During fiscal year 2024, the Company had issued 213,504,800 Ordinary Shares. As a result of the Share Consolidation, upon the Effective Date, there will be approximately 3,378,188 as of December 31, 2024.

The accompanying notes are an integral part of these consolidated financial statements.

**U POWER LIMITED**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(Amounts in thousands of RMB and US$, except for number of shares)**

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** |
|  | **2021** | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **RMB** | **US$** |
| **CASH FLOWS FROM OPERATING ACTIVITIES** |  |  |  |  |  |
| **Net loss** | (49064) | (57667) | (25466) | (56362) | (7721) |
| *Adjustments to reconcile net loss to net cash used in operating activities:* |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 1773 | 2093 | 2607 | 3057 | 419 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of right-of-use assets | 3448 | 5611 | 5719 | 5450 | 747 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on termination of right-of-use assets |  | 1750 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for doubtful accounts |  | 9801 | 1196 | 5264 | 721 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on impairment of property, plant and equipment |  |  | 1896 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on impairment of inventory |  | 180 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on impairment of long-term investment |  |  | 100 | 10503 | 1439 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share of loss in equity method investee |  | 39 | 94 | 295 | 40 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reversal of loss on impairment of Inventories |  |  |  | (79) | (11) |
| *Changes in operating assets and liabilities:* |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivables | (181) | (1424) | (14168) | 3811 | 522 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | (13250) | 7810 | 107 | (4354) | (596) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advance to suppliers | (71148) | 61085 | (3929) | 1499 | 205 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current assets | (6968) | (23023) | (21228) | 8174 | 1119 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount due from related parties | 843 | 84 | (22) | (1514) | (207) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current assets | (68) |  | 30 | (45704) | (6262) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payables | 8488 | 1331 | (899) | 4076 | 558 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued expenses and other payables | 2184 | 32160 | (15106) | (1862) | (255) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax payables | 2582 | (3) | 2621 | (31) | (4) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advance from customers | 44964 | (50420) | (721) | (1451) | (199) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amount due to related parties | (589) | 140 | 5180 | (2192) | (300) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liabilities | (5243) | (2439) | (3453) | (1750) | (240) |
| **Net cash used in operating activities** | **(82229)** | **(12892)** | **(65442)** | **(73170)** | **(10025)** |
| **CASH FLOWS FROM INVESTING ACTIVITIES** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchases of property, plant and equipment | (9573) | (7769) | (881) | (10) | (1) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from disposal of property, plant and equipment |  |  |  | 130 | 18 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchases of intangible assets | (1423) | (31) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans provided to third parties | (17046) | (3859) | (33255) | 16734 | 2293 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Received from refundable deposit for investment | 3614 | 2122 | 7409 | 32975 | 4518 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepayment |  |  | (42599) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans provided to related parties | (886) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans repayments from related parties | 555 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Payment for deferred consideration in relation to investment |  |  | (3000) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Decrease/(increase) in long-term investments | 10000 | (1850) | (11750) | (736) | (102) |
| **Net cash used in investing activities** | **(14759)** | **(11387)** | **(84076)** | **49093** | **6726** |
| **CASH FLOWS FROM FINANCING ACTIVITIES** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Capital contribution by non-controlling shareholders | 999 | 5000 | 5000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans received from a third party | 998 |  | 15006 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans received from long-term bank borrowing | 10000 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from issuance of ordinary shares |  |  | 156197 | 25873 | 3545 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayments of short-term bank borrowing | (3000) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from short-term bank borrowing |  |  | 5000 | 10172 | 1394 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayments of long-term bank borrowing |  | (500) | (500) | (3000) | (411) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayments of loan payable | (13000) | - | (1300) | (20087) | (2752) |
| **Net cash (used in)/provided by financing activities** | **(4003)** | **4500** | **179403** | **12958** | **1776** |
| Net (decrease)/increase in cash and cash equivalents and restricted cash | (100991) | (19779) | 29885 | (11119) | (1523) |
| Effects of exchange rate changes |  |  | 446 | (446) | (61) |
| Cash and cash equivalents and restricted cash at beginning of year | 126678 | 25687 | 5908 | 36239 | 4965 |
| **Cash and cash equivalents and restricted cash at end of year** | **25687** | **5908** | **36239** | **24674** | **3381** |
| **Supplemental disclosures of non-cash activities:** |  |  |  |  |  |
| Right-of-use assets obtained in exchange for new operating lease liabilities | 8538 | 6603 | 4698 |  |  |
| Derecognition of right-of-use assets |  | 7408 |  |  |  |
| Derecognition of lease liabilities |  | 5658 |  |  |  |
| Issue of share for right-of-use assets |  |  | 3428 |  |  |

---

The accompanying notes are an integral part of these consolidated financial statements.

**U POWER LIMITED**

**NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS**

**(Amounts in thousands of RMB and US$, except for number of shares and per share data)**

**1. ORGANIZATION**

 ****

***(a) Nature of operations***

U POWER LIMITED (the "Company") was incorporated in the Cayman Islands on June 17, 2021, under the Cayman Islands Companies Law as an exempted company with limited liability. Anhui Yousheng New Energy Technology Group Co., Ltd. ("AHYS", formerly known as "Shanghai Yousheng New Energy Technology Group Co. Ltd.") was incorporated in the People's Republic of China (the "PRC" or "China") on May 16, 2013. AHYS, together with its subsidiaries (collectively, the "Operating Entities") are principally engaged in the provision of: 1) new energy vehicles development and sales; 2) battery-swapping stations manufacturing and sales; 3) battery-swapping services; and 4) sourcing services (collectively, "Principal Business").

 ****

***(b) Reorganization***

In preparation of its initial public offering ("IPO") in the United States, the following transactions were undertaken to reorganize the legal structure of the Operating Entities. The Company was incorporated in connection with a group reorganization (the "Reorganization") of the Operating Entities. On June 30, 2021, and January 5, 2022, the Company incorporated two wholly-owned subsidiaries, Youcang Limited ("Youcang") and U Robur Limited ("U Robur BVI") in British Virgin Islands, respectively. On July 19, 2021, Youcang incorporated a wholly-owned subsidiary, Energy U Limited ("Energy U") in Hong Kong. On January 24, 2022, U Robur BVI incorporated a wholly-owned subsidiary, U Robur Limited ("U Robur HK"). On January 27, 2021, Energy U incorporated a wholly-owned subsidiary, Shandong Yousheng New Energy Technology Development Co, Ltd. ("WFOE") in the PRC.

On July 8, 2022, the Company, through WFOE, entered into an equity purchase agreement with AHYS and its then shareholders, through which the Company has become the ultimate primary beneficiary of AHYS. As all the entities involved in the process of the Reorganization are under common ownership of AHYS's shareholders before and after the Reorganization, the Reorganization is accounted for in a manner similar to a pooling of interests with the assets and liabilities of the parties to the Reorganization carried over at their historical amounts. Therefore, the accompanying consolidated financial statements were prepared as if the corporate structure of the Company had been in existence since the beginning of the periods presented. The Company and its subsidiaries hereinafter are collectively referred to as the "Group".

As of the date of December 31, 2024, the details of the Company's principal subsidiaries are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Entity** | **Date of<br> incorporation/<br> acquisition** | **Place of<br> incorporation** | **Percentage<br> of direct<br> or indirect<br> ownership<br> by the<br> Company** | **Principal activities** |
| **Subsidiaries:** |  |  | |  |
| Youcang Limited ("Youcang") | June 30, 2021 | British Virgin Islands | 100% | Investment holding |
| Energy U Limited ("Energy U") | July 19, 2021 | Hong Kong | 100% | Investment holding |
| Shandong Yousheng New Energy Technology Development Co, Ltd. ("WFOE")<sup>(1)</sup> | January 27, 2022 | PRC | 100% | Provision of technical and consultation services |
| Anhui Yousheng New Energy Co., Ltd ("AHYS")<sup>(1)</sup> | May 16, 2013 | PRC | 100% | Dormant Company |
| Youpin Automobile Service Group Co. Ltd. ("Youpin")<sup>(1)</sup> | July 18, 2013 | PRC | 54.37% | Provision of new energy vehicles sales, battery-swapping stations sales, battery-swapping services and sourcing services |
| Shanghai Youchuangneng Digital Technology Co., Ltd. ("SY Digital Tech) <sup>(1)</sup> | November 13, 2015 | PRC | 100% | Provision of new energy vehicles sales, battery-swapping stations sales, battery-swapping services and sourcing services |
| Youguan Financial Leasing Co., Ltd. ("Youguan Financial Leasing")<sup>(1)</sup> | February 27, 2017 | PRC | 100% | Dormant Company |
| Youpin Automobile Service (Shandong) Co., Ltd. ("Youpin SD")<sup>(1)</sup> | June 30, 2020 | PRC | 86.96% | Provision of new energy vehicles sales and sourcing services |
| Chengdu Youyineng Automobile Service Co., Ltd. ("CD Youyineng")<sup>(1)</sup> | October 29, 2020 | PRC | 100% | Provision of battery-swapping stations manufacturing |
| Shanghai Youteng Automobile Service Co., Ltd. ("SH Youteng")<sup>(1)</sup> | November 3, 2020 | PRC | 70% | Dormant Company |
| Liaoning Youguan New Energy Technology Co. Ltd. ("LY New Energy")<sup>(1)</sup> | November 8, 2019 | PRC | 100% | Provision of new energy vehicles sales and sourcing services |
| Shanghai Youxu New Energy Technology Co., Ltd. ("SH Youxu")<sup>(1)</sup> | March 22, 2021 | PRC | 70% | Provision of battery-swapping stations sales and battery-swapping services and two-wheeled vehicle battery-swapping services |
| Quanzhou Youyi Power Exchange Network Technology Co., Ltd. ("QZ Youyi")<sup>(1)</sup> | June 29, 2021 | PRC | 100% | Provision of battery-swapping services |
| Youxu New Energy Technology (Zibo) Co., Ltd. ("Youxu Zibo")<sup>(1)</sup> | July 29, 2021 | PRC | 100% | Provision of batter swapping stations manufacturing |
| Youxu (Xiamen) Power Exchange Network Technology Co., Ltd. ("Youxu XM")<sup>(1)</sup> | August 10, 2021 | PRC | 100% | Provision of battery-swapping services |
| Wuhu Youxu New Energy Technology Co., Ltd. ("WH Youxu") <sup>(1)</sup> | November 12, 2021 | PRC | 100% | Provision of batter swapping stations manufacturing |
| Henan Youxu New Energy Technology Co., Ltd. ("HN Youxu") <sup>(1)</sup> | December 1, 2022 | PRC | 80% | Dormant Company |
| Youxu New Energy Technology (Nanyang) Co., Ltd. ("NY Youxu") <sup>(1)</sup> | March 14, 2023 | PRC | 70% | Provision of batter swapping stations manufacturing |
| U SWAP CO LTD("U SWAP") | June 13, 2024 | Thailand | 85% | Provision of new energy vehicles sales, battery-swapping stations sales, battery-swapping services and sourcing services |

---

(1) Collectively, the "PRC subsidiaries".

***(c) Initial Public Offering***

In April 2023, the Company, in connection with its IPO in the United States, issued 24,167 ordinary shares (2,416,667 ordinary shares before the share consolidation implemented on March 25, 2024 (the "Share Consolidation")) with net proceeds of approximately US$13,000.

***(d) Additional shares issued***

 ****

In December 2023, the Company, in connection with its follow-on offering, issued 718,973 ordinary shares (71,897,268 ordinary shares before the Share Consolidation) with net proceeds of approximately US$9,000.

***(e) Consolidation of Ordinary Shares***

 ****

On March 25, 2024, the Company issued an aggregate of every 100 Ordinary Shares with a par value of US$0.0000001 each in the Company's issued and unissued share capital be consolidated into one Ordinary Share with a par value of US$0.00001 each, so that immediately following the Share Consolidation, the authorized share capital of the Company shall be changed. As of December, 2024, the Company had 213,504,800 Ordinary Shares issued and outstanding. As a result of the Share Consolidation, upon the Effective Date, there will be approximately 3,378,188.

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

 ****

***(a) Basis of presentation***

The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP").

 ****

***(b) Principles of consolidation***

The accompanying consolidated financial statements of the Group include the financial statements of the Company and its subsidiaries for which the Company is the ultimate primary beneficiary.

A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting power; has the power to appoint or remove the majority of the members of the board of directors (the "Board"); and to cast majority of votes at the meeting of the Board or to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders.

All significant transactions and balances between the Company and its subsidiaries have been eliminated in consolidation. The non-controlling interests in consolidated subsidiaries are shown separately in the consolidated financial statements.

 ****

***(c) Use of estimates***

The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Significant accounting estimates reflected in the Group's consolidated financial statements mainly include the incremental borrowing rate used in the recognition of right-of-use assets and lease liabilities, allowance for expected credit loss, the useful lives of property, plant and equipment and intangible assets, contingent liabilities and valuation allowance for deferred tax assets. The Group bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Any future changes to these estimates and assumptions could cause a material change to the Group's reported amounts of revenues, expenses, assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions.

***(d) Functional currency and foreign currency translation***

The Group uses Renminbi ("RMB") as its reporting currency. The functional currency of the Company and its overseas subsidiaries which incorporated in the Cayman Islands and British Virgin Islands is US Dollar ("US$"). The functional currency of the Company's subsidiaries which incorporated in Hong Kong is Hong Kong Dollar ("HK$"). The functional currency of the Company's subsidiaries which incorporated in the PRC is RMB.

In the consolidated financial statements, the financial information of the Company and other entities located outside of PRC has been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenue, expenses, gains and losses are translated using the average rate for the periods. Translation adjustments are reported as foreign currency translation adjustments and are shown as a component of other comprehensive loss in the consolidated statements of operations and comprehensive income (loss). There was nil, RMB446, and RMB446 foreign currency translation gain or loss recognized for the years ended December 31, 2022, 2023, and 2024.

 ****

***(e) Convenience translation***

The Group's business is primarily conducted in China and all of the revenue are denominated in RMB. However, periodic reports made to shareholders will include current period amounts translated into US dollars using the exchange rate as of balance sheet date, for the convenience of the readers. Translations of balances in the consolidated balance sheets, consolidated statements of comprehensive loss, change in equity and related consolidated statements of cash flows from RMB into US$ as of and for the fiscal year ended December 31, 2024 are solely for the convenience of the reader and were calculated at the rate of US$1.00 to RMB7.2993, representing the noon buying rate in The City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York on December 31, 2024. No representation is made that the RMB amounts represent or could have been, or could be, converted, realized or settled into US$ at that rate on December 31, 2024 or at any other rate.

***(f) Non-controlling interest***

For certain subsidiaries, a non-controlling interest is recognized to reflect the portion of their equity which is not attributable, directly or indirectly, to the Group. Consolidated net loss or income on the consolidated statements of operations includes the net loss or income attributable to non-controlling interests. Non-controlling interests are classified as a separate line item in the equity section of the Group's consolidated balance sheets and have been separately disclosed in the Group's consolidated statements of operations to distinguish the interests from that of the Company.

 ****

***(g) Cash and cash equivalents***

Cash and cash equivalents represent cash on hand, time deposits and highly-liquid investments placed with banks or other financial institutions, which are unrestricted as to withdrawal and use, and which have original maturities of three months or less.

 ****

***(h) Restricted cash***

Restricted cash represents the cash that is not freely available to be spent nor re-invested to sustain future growth, which is legally or contractually restricted, or only to be used for a specified purpose. The restrictions can be permanent or temporary. Failure to use the asset according to agreed limitations will generate contractual or legal consequences.

 ****

 ****

***(i) Allowance for doubtful accounts***

Accounts receivable, advance to suppliers and other current assets are recognized at original invoiced amount. The Group measures all expected credit losses at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. The Group reviews the accounts receivable, advance to suppliers and other current assets periodically, and recognizes the expected credit losses based on many factors, including the customer's payment history, its current credit-worthiness and current economic trends.

Based on the result of the Group's estimation of collectability, the Group recognized RMB9,801, RMB1,196, and RMB5,264 of allowances for doubtful accounts for the years ended December 31, 2022, 2023, and 2024, respectively.

 ****

***(j) Inventories***

Inventories, consisting of raw materials and products available for sale, are stated at the lower of cost or net realizable value. Cost of inventory are determined using the first-in-first-out method. The Group records inventory reserves for obsolete and slow-moving inventory. Inventory reserves are based on inventory obsolescence trends, historical experience and application of the specific identification method. The Group recognized RMB180, nil, and nil of inventory impairment for the years ended December 31, 2022, 2023, and 2024, respectively.

 ****

***(k) Property, plant and equipment, net***

Property, plant and equipment are stated at cost less accumulated depreciation and impairment loss, if any. Property, plant and equipment are depreciated at rates sufficient to write off their costs less impairment and residual value, if any, over their estimated useful lives on a straight-line basis. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful lives of the related assets. Within the property, plant and equipment, the value for construction in process is included within the manufacturing equipment.

---

| | |
|:---|:---|
| **Category** | **Estimated useful life** |
| Leasehold improvements | 1-3 years |
| Manufacturing equipment | 3 – 10 years |
| Computer and electronic equipment | 3 – 5 years |
| Office equipment | 2 – 4 years |
| Motor vehicles | 3 – 4 years |

---

 ****

***(l) Intangible assets, net***

Intangible assets are carried at cost less accumulated amortization and impairment, if any. Intangible assets are amortized using the straight-line method over the estimated useful lives from 3 to 5 years. The estimated useful lives of amortized intangible assets are reassessed if circumstances occur that indicate the original estimated useful lives have changed.

 ****

***(m) Impairment of long-lived assets***

The Group evaluates its long-lived assets, including property, plant and equipment and software and right-of-use assets with finite lives, 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 of an asset may not be fully recoverable. When these events occur, the Group evaluates the recoverability of long-lived assets by comparing the carrying amounts of the assets to the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amounts of the assets, the Group recognizes an impairment loss based on the excess of the carrying amounts of the assets over their fair value. Fair value is generally determined by discounting the cash flows expected to be generated by the assets, when the market prices are not readily available. The Group recognized nil, RMB1,896, and nil of impairment on fixed assets for the years ended December 31, 2022, 2023, and 2024, respectively.

***(n) Long-term investments***

The Group's long-term investments mainly include equity investments in entities. Investments in entities in which the Group can exercise significant influence and holds an investment in voting common stock or in-substance common stock (or both) of the investee but does not own a majority equity interest or control are accounted for using the equity method of accounting in accordance with ASC topic 323, *Investments - Equity Method and Joint Ventures ("ASC 323")*. Under the equity method, the Group initially records its investments at fair value. The Group subsequently adjusts the carrying amount of the investments to recognize the Group's proportionate share of each equity investee's net income or loss into earnings after the date of investment. The Group evaluates the equity method investments for impairment under ASC 323. An impairment loss on the equity method investments is recognized in earnings when the decline in value is determined to be other-than-temporary. The Group recognized nil, RMB100, and RMB 10,503 of impairment on long-term investments for the years ended December 31, 2022, 2023, and 2024, respectively.

 ****

***(o) Fair value of financial instruments***

Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be either recorded or disclosed at fair value, the Group considers the principal or most advantageous market in which it would transact, and it also considers assumptions that market participants would use when pricing the asset or liability.

Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value:

Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 - Other inputs that are directly or indirectly observable in the marketplace.

Level 3 - Unobservable inputs which are supported by little or no market activity.

Financial assets and liabilities of the Group primarily consist of cash and cash equivalents, accounts receivable, amounts due from related parties, deposits and other receivables, accounts payable, amounts due to related parties, other payables, short-term bank and other borrowings and loan payables. As of December 31, 2024, the carrying values of these financial instruments are approximated to their fair values.

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***(p) Revenue recognition***

Under ASC 606, Revenue from Contracts with Customers, the Group recognizes revenue when a customer obtains control of promised goods or services and recognizes in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services.

The Group recognized revenue according to the following five-step revenue recognition criteria based on ASC 606: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price; and (5) recognize revenue when or as the entity satisfies a performance obligation.

The Group recognized revenue when or as the control of the goods or services is transferred to a customer. Depending on the terms of the contract and the laws that apply to the contract, control of the goods and services may be transferred over time or at a point in time. Control of the goods and services is transferred over time if the Group's performance:

&nbsp;&nbsp;&nbsp;&nbsp;(i) provides all of the benefits received and consumed simultaneously by the customer;

&nbsp;&nbsp;&nbsp;&nbsp;(ii) creates and enhances an asset that the customer controls as the Group performs; or

&nbsp;&nbsp;&nbsp;&nbsp;(iii) does not create an asset with an alternative use to the Group and the Group has an enforceable right to payment for performance completed to date. If control of the goods and services transfers over time, revenue is recognized over the period of the contract by reference to the progress towards complete satisfaction of that performance obligation. Otherwise, revenue is recognized at a point in time when the customer obtains control of the goods and services.

If control of the goods and services transfers over time, revenue is recognized over the period of the contract by reference to the progress towards complete satisfaction of that performance obligation. Otherwise, revenue is recognized at a point in time when the customer obtains control of the goods and services.

Contracts with customers may include multiple performance obligations. For such arrangements, the Group allocates revenue to each performance obligation based on its relative standalone selling price. The Group generally determines standalone selling prices based on the prices charged to customers. If the standalone selling price is not directly observable, it is estimated using expected cost plus a margin or adjusted market assessment approach, depending on the availability of observable information. Assumptions and estimations have been made in estimating the relative selling price of each distinct performance obligation, and changes in judgments on these assumptions and estimates may impact the revenue recognition.

When either party to a contract has performed, the Group presents the contract in the consolidated balance sheets as a contract asset or a contract liability, depending on the relationship between the entity's performance and the customer's payment.

A contract asset is the Group's right to consideration in exchange for goods and services that the Group has transferred to a customer. A receivable is recorded when the Group has an unconditional right to consideration. A right to consideration is unconditional if only the passage of time is required before payment of that consideration is due.

If a customer pays consideration or the Group has a right to an amount of consideration that is unconditional, before the Group transfers a good or service to the customer, the Group presents the contract liability when the payment is made, or a receivable is recorded (whichever is earlier). A contract liability is the Group's obligation to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer.

 

The following table sets forth a breakdown of the Group's revenue, in absolute amounts and percentages of total revenue for the years presented:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** | **For the Years Ended December 31,** |
|  | **2022** | **2022** | **2023** | **2023** | **2024** | **2024** | **2024** |
|  | **RMB** | **%** | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
| Sourcing services | 4428 | 56.8 | 1513 | 7.7 | 63 | 9 | 0.1 |
| Product sales | 3061 | 39.3 | 17062 | 86.3 | 41819 | 5729 | 94.5 |
| Battery-swapping services | 307 | 3.9 | 1189 | 6.0 | 1177 | 161 | 2.7 |
| Two-wheeled vehicle battery-swapping services | - | - | - | - | 1231 | 169 | 2.7 |
| **Total revenue** | **7796** | **100.0** | **19764** | **100.0** | **44290** | **6068** | **100.0** |

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*Sourcing services*

The Group generates revenue from the vehicle sourcing business and battery sourcing business.

Regarding to battery sourcing business, the Group acts as a principal as of being able to fully control relevant risks and benefits during the whole business, indicated by that can decide the selling price, has a right to recall the product and cease the transaction, and bear relevant risk of damage and loss prior to the delivery of battery to the customer. The sales of battery sourcing revenue are recognized on a gross basis at a point in time when the control of the battery pack is transferred to the customer.

For vehicle sourcing business, the Group charges service fees from its customers for their purchase of vehicles, where the Group is generally acting as an agent and its performance obligation is to purchase the specified vehicles for its customers. The Group charges the customers a commission that is calculated based on the purchase price of each purchase order. Vehicle sourcing service revenue are recognized on a net basis at the point in time when the service of purchase of the specified vehicles for the Group's customers is completed, i.e., the specified vehicle for the Group's customers is delivered. Payments are typically received in advance and are accounted for as contract liabilities until delivery, at which point the receipt in advance from customers is offset with the prepayment to the supplier and the difference representing the commission is recognized as revenue.

 

*Product sales*

The Group generates revenue from sales of battery-swapping stations. The Group identifies the users who purchase battery-swapping stations as its customers. The revenue for battery-swapping station sales is recognized at a point in time when the control of the product is transferred to the customer.

 

*Battery-swapping services* 

The Group also generates revenue from providing battery-swapping services to vehicle drivers and the station control system upgrading services to the battery-swapping station owners. The Group identifies vehicle drivers who require battery-swapping services, as well as owners of battery-swapping stations to whom the Group has sold stations and who require station control system upgrade services, as its customers.

The Group charges the battery-swapping service fees from its customers based on vehicle miles traveled. However, as usually, the swapped battery will be immediately used after the payment by customers for driving and the power consumption of vehicles will be fast, the Group ignores the time interval between the timing of payment in advance by customers and the usage life of the swapped battery. The revenue generated from battery-swapping services to vehicle drivers is recognized at a point in time when the Group received the payment from vehicle drivers.

The revenue generated from the station control system upgrading service is recognized over time based on a straight-line method.

*Two-wheeled vehicle battery-swapping services*

 

By providing battery swap cabinets, two-wheeled vehicle drivers can perform self-service battery swaps. We charge the drivers a certain amount as revenue from battery rentals.

The Group charges customers a fee for battery-swapping services based on the duration of service. Revenue from two-wheeled vehicle battery-swapping services is recognized over time.

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***(q) Cost of revenue***

Cost of sales of battery-swapping stations primarily includes semi-finished goods purchased from suppliers, labor costs and manufacturing including depreciation of assets associated with production.

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***(r) Sales and marketing expenses***

Sales and marketing expenses consist primarily of (i) compensation to selling personnel, including the salaries, performance-based bonus, and other benefits; (ii) travel cost related to the sales and marketing function; (iii) advertising, marketing and brand promotion expenses; and (iv) other expenses in relation to the selling and marketing activities. Advertising expenses consist primarily of costs for the promotion of corporate image and product marketing. The Group expenses all advertising costs of RMB 386 (US$53) as incurred and classifies these costs under sales and marketing expenses.

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***(s) Research and development expenses***

Research and development expenses consist primarily of personnel-related costs directly associated with research and development organization. The Group's research and development expenses are related to enhancing and developing UOTTA technology for its existing products and new product development. The Group expenses research and development costs as incurred.

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***(t) General and administrative expenses***

General and administrative expenses consist primarily of salaries, bonuses and benefits for employees involved in general corporate functions, and those not specifically dedicated to research and development activities, such as 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.

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***(u) Employee benefits***

Full time employees of the Group in the PRC participate in a government mandated defined contribution plan, pursuant to which certain pension benefits, medical care, employee housing fund and other welfare benefits are provided to the employees. Chinese labor regulations require that the PRC subsidiaries of the Group make contributions to the government for these benefits based on certain percentages of the employees' salaries, up to a maximum amount specified by the local government. The Group has no legal obligation for the benefits beyond the contributions made.

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***(v) Government grants***

The Group's PRC-based subsidiaries received government subsidies from certain local governments. The Group's government subsidies consisted of specific subsidies and other subsidies. Specific subsidies are subsidies that the local government has provided for a specific purpose, such as product development and renewal of production facilities. Other subsidies are the subsidies that the local government has not specified its purpose for and are not tied to future trends or performance of the Group. Receipt of such subsidy income is not contingent upon any further actions or performance of the Group and the amounts do not have to be refunded under any circumstances. The Group recorded specific purpose subsidies as advances payable when received. For specific subsidies, upon government acceptance of the related project development or asset acquisition, the specific purpose subsidies are recognized to reduce related R&D expenses or the cost of asset acquisition. Other subsidies are recognized as other operating income upon receipt as further performance by the Group is not required.

***(w) Taxation***

<u>Income Taxes</u>

Current income taxes are provided on the basis of income/(loss) for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions. Deferred income taxes are provided using the assets and liabilities method. Under this method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The tax base of an asset or liability is the amount attributed to that asset or liability for tax purposes. The effect on deferred taxes of a change in tax rates is recognized in the consolidated statement of income and comprehensive income in the period of change. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more-likely-than-not that some portion of, or all of the deferred tax assets will not be realized.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Group considers positive and negative evidence when determining whether a portion or all of its deferred tax assets will more likely than not be realized. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry-forward periods, its experience with tax attributes expiring unused, and its tax planning strategies. The ultimate realization of deferred tax assets is dependent upon its ability to generate sufficient future taxable income within the carry-forward periods provided for in the tax law and during the periods in which the temporary differences become deductible. When assessing the realization of deferred tax assets, the Group considers possible sources of taxable income including (i) future reversals of existing taxable temporary differences, (ii) future taxable income exclusive of reversing temporary differences and carry-forwards, (iii) future taxable income arising from implementing tax planning strategies, and (iv) specific known trend of profits expected to be reflected within the industry.

 

*<u>Value added tax</u>*

Revenue represents the invoiced value of goods and services, net of value added tax ("VAT"). The VAT is based on gross sales price with VAT rates of 6% and 13%, depending on the type of products sold or service provided. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. Net VAT balance between input VAT and output VAT is recorded in taxes payable. All of the VAT returns filed by the Company's subsidiaries in PRC remain subject to examination by the tax authorities for five years from the date of filing.

 

*<u>Uncertain tax positions</u>*

The Group applies the provisions of ASC topic 740 ("ASC 740"), Accounting for Income Taxes, to account for uncertainty in income taxes. ASC 740 prescribes a recognition threshold a tax position is required to meet before being recognized in the financial statements. The benefit of a tax position is recognized if a tax return position or future tax position is "more likely than not" to be sustained under examination based solely on the technical merits of the position. Tax positions that meet the "more likely than not" recognition threshold is measured, using a cumulative probability approach, at the largest amount of tax benefit that has a greater than fifty percent likelihood of being realized upon settlement. The estimated liability for unrecognized tax benefits is periodically assessed for adequacy and may be affected by changing interpretations of laws, rulings by tax authorities, changes and or developments with respect to tax audits, and the expiration of the statute of limitations. Additionally, in future periods, changes in facts and circumstances, and new information may require the Group to adjust the recognition and measurement of estimates with regards to changes in individual tax position. Changes in recognition and measurement of estimates are recognized in the period in which the change occurs.

The Group's operating subsidiaries in PRC are subject to examination by the relevant tax authorities. According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of taxes is due to computational errors made by the taxpayer or the withholding agent. The statute of limitations is extended to five years under special circumstances, where the underpayment of taxes is more than RMB100 (US$15). In the case of transfer pricing issues, the statute of limitation is ten years. There is no statute of limitation in the case of tax evasion. Penalties and interests incurred related to underpayment of income tax are classified as income tax expense in the period incurred.

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***(x) Comprehensive income***

The Group has adopted FASB Accounting Standard Codification Topic 220 ("ASC 220") "Comprehensive income", which establishes standards for reporting and the presentation of comprehensive income (loss), its components and accumulated balances.

There was no other comprehensive income or loss for the fiscal year ended December 31, 2022, other comprehensive income of RMB446 for the fiscal year ended December 31, 2023, and other comprehensive loss of RMB446 for the fiscal year ended December 31, 2024.

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***(y) Leases***

The Group accounts for lease under ASC Topic 842, Leases. The Group determines if an arrangement is or contains a lease at inception. Right-of-use assets and liabilities are recognized at lease commencement date based on the present value of remaining lease payments over the lease terms. The Group considers only payments that are fixed and determinable at the time of lease commencement.

At the commencement date, the lease liability is recognized at the present value of the lease payments not yet paid, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate for the same term as the underlying lease. The right-of-use asset is recognized initially at cost, which primarily comprises the initial amount of the lease liability, plus any initial direct costs incurred. All right-of-use assets are reviewed for impairment annually. There was no impairment for right-of-use lease assets as of December 31, 2022, 2023, and 2024. The Group recorded a loss on lease termination of right-of-use assets of RMB1,750, nil, and nil for the years ended December 31, 2022, 2023, and 2024, respectively.

Operating lease assets are included within "right-of-use assets - operating lease", and the corresponding operating lease liabilities are included within "operating lease liabilities" on the consolidated balance sheets as of December 31, 2022, 2023 and 2024, respectively.

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***(z) Commitments and contingencies***

In the normal course of business, the Group is subject to contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of matters. Liabilities for contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.

If the assessment of a contingency indicates that it is probable that a loss is incurred and the amount of the liability can be estimated, then the estimated liability is accrued in the consolidated financial statements. If the assessment indicates that a potential loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed.

The Group recognized RMB2,900, RMB3,507, and nil of commitments and contingencies as of the years ended December 31, 2022, 2023, and 2024, respectively.

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***(aa) Segment reporting***

ASC 280, *Segment Reporting*, ("ASC 280"), establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers.

Based on the criteria established by ASC 280, the Company's chief operating decision maker ("CODM") has been identified as the Company's Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company. As a whole and hence, the Company has only one reportable segment. The Company does not distinguish between markets or segments for the purpose of internal reporting. As the Company's long-lived assets are substantially located in the PRC, no geographical segments are presented.

***(ab) Recent adopted standards***

In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments – Credit Losses", which will require the measurement of all allowance for expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Subsequently, the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, to clarify that receivables arising from operating leases are within the scope of lease accounting standards. Further, the FASB issued ASU No. 2019-04, ASU 2019-05, ASU 2019-10, ASU 2019-11 and ASU 2020-02 to provide additional guidance on the credit losses standard, which defers the effective date of ASU No. 2016-13 for smaller reporting companies to fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The impact of the adoption on the consolidated balance sheets, statements of operations, and statements of cash flows was immaterial.

***(ac) Recent accounting pronouncements***

In June 2022, the FASB issued ASU 2023-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. The update clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The update also clarifies that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The update also requires certain additional disclosures for equity securities subject to contractual sale restrictions. The amendments in this update are effective for the Group beginning January 1, 2024 on a prospective basis. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The Group does not expect that the adoption of this guidance will have a material impact on its financial position, results of operations and cash flows.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which focuses on improving reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. A public entity shall disclose for each reportable segment the significant expense categories and amounts that are regularly provided to the CODM and included in reported segment profit or loss. ASU 2023-07 also requires public entities to provide in interim periods all disclosures about a reportable segment's profit or loss and assets that are currently required annually. Entities are permitted to disclose more than one measure of a segment's profit or loss if such measures are used by the CODM to allocate resources and assess performance, as long as at least one of those measures is determined in a way that is most consistent with the measurement principles used to measure the corresponding amounts in the consolidated financial statements. ASU 2023-07 is applied retrospectively to all periods presented in financial statements, unless it is impracticable. This update will be effective for the Group's fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. The Group is currently in the process of evaluating the disclosure impact of adopting ASU 2023-07.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires specific disaggregated information about a reporting entity's effective tax rate reconciliation as well as additional information on income taxes paid. The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. This ASU will result in the required additional disclosures being included in the consolidated financial statements, once adopted. The Company is in the process of evaluating the impact of the new guidance and does not expect it to have a significant impact on its consolidated financial statements.

**3. LIQUIDITY**

For the fiscal year ended December 31, 2023, the Group reported a net loss of RMB25,466, negative operating cash flows of RMB65,442, net current assets of RMB88,316, and accumulated deficit of RMB173,176. These conditions raise substantial doubt about the Group's ability to continue as a going concern.

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For the fiscal year ended December 31, 2024, the Group reported a net loss of RMB56,362 (US$7,721), negative operating cash flows of RMB73,170 (US$10,025), and accumulated deficit of RMB221,098 (US$30,290). These conditions raise substantial doubt about the Group's ability to continue as a going concern.

In assessing the Group's liquidity, the Group monitors and analyzes its cash on-hand and its operating and capital expenditure commitments. The Group's liquidity needs are to meet its working capital requirements, operating expenses and capital expenditure obligations. Cash generated by operating activities and commercial bank loans, together with the net proceeds from its IPO in April 2023, have been utilized to finance the working capital requirements of the Group.

As of December 31, 2022, 2023, and 2024, the Group's cash and cash equivalents and restricted cash were RMB5,908, RMB36,239, and RMB24,674 (US$3,381), respectively. The Group's cash and cash equivalents primarily consist of cash on hand and highly liquid investments placed with banks, which are unrestricted to withdrawal and use and which have original maturities of three months or less.

The Group believes that the substantial doubt of its ability to continue as going concern is alleviated based on the proceeds received from investors and anticipated increase in cash generated from operations. Meanwhile, on an on-going basis, the Group also has received the financial support commitments from the Company's key management to enable the Group to meet its other liabilities and commitments. The Group received an additional capital injection of US$4,662. The Group believes its existing cash and cash equivalents, anticipated cash raised from financings, and anticipated cash flow from operations, will be sufficient to meet its anticipated cash needs for the next 12 months from the date of this report. The exact amount of proceeds the Group will use for its operations and expansion plans will depend on the amount of cash generated from its operations and any strategic decisions the Group may make that could alter its expansion plans and the amount of cash necessary to fund these plans.

The management believes that the Group will continue as a going concern in the following 12 months from the date the Group's 2024 consolidated financial statements are issued. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.

**4. CONCENTRATION OF RISKS**

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***(a) Political, social and economic risks***

The Group's operations could be adversely affected by significant political, economic and social uncertainties in the PRC. Although the PRC government has been pursuing economic reform policies for more than 20 years, no assurance can be given that the PRC government will continue to pursue such policies or that such policies may not be significantly altered, especially in the event of a change in leadership, social or political disruption or unforeseen circumstances affecting the PRC political, economic and social conditions. There is also no guarantee that the PRC government's pursuit of economic reforms will be consistent or effective.

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***(b) Interest rate risk***

The Group is exposed to interest rate risk on its interest-bearing assets and liabilities. As part of its asset and liability risk management, the Group reviews and takes appropriate steps to manage its interest rate exposure on its interest-bearing assets and liabilities. The Group has not been exposed to material risks due to changes in market interest rates, and has not used any derivative financial instruments to manage the interest risk exposure during the years presented.

***(c) Credit risk***

Financial instruments that potentially subject the Group to significant concentrations of credit risk consist primarily of cash. As of December 31, 2022, 2023, and 2024, approximately RMB5,908, RMB36,239, and RMB24,674 (US$3,381), were deposited with financial institutions located in the PRC, respectively, where there is a RMB500 deposit insurance limit for a legal entity's aggregated balance at each bank. While the Group believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

The Group is also exposed to risk from its accounts receivable and other receivables. These assets are subjected to credit evaluations. An allowance has been made for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.

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***(d) Currency convertibility risk***

Substantially the Group's operating activities are settled in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the People's Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People's Bank of China. Approval of foreign currency payments by the People's Bank of China or other regulatory institutions requires submitting a payment application form together with supporting documents.

**5. ACCOUNTS RECEIVABLE**

Accounts receivable and the allowance for doubtful debt consisted of the following:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Accounts receivable | 1617 | 15785 | 11975 | 1640 |
| Less: allowance for doubtful accounts | - | (37) | (1601) | (219) |
|  | **1617** | **15748** | **10374** | **1421** |

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As of December 31, 2022, 2023, and 2024, all accounts receivable were due from third-party customers. There was nil, RMB37, and RMB1,601 allowance for doubtful accounts recognized as of the years ended December 31, 2022, 2023 and 2024, respectively.

**6. INVENTORY**

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Raw materials | 1793 | 1784 | 3358 | 460 |
| Low value consumables | 41 | 41 | 34 | 5 |
| Finished goods | 3803 | 3705 | 6492 | 889 |
| Less: inventory impairment | (180) | (91) | (12) | (2) |
|  | **5457** | **5439** | **9872** | **1352** |

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The Group recognized RMB180, nil, and nil of impairment of inventory for the years ended December 31, 2022, 2023, and 2024, respectively.

The impairment was due to the fact that inventory is obsolete and no longer sellable.

**7. ADVANCE TO SUPPLIERS**

Advance to suppliers consisted of the following:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Advance to suppliers | 15359 | 19288 | 17789 | 2437 |
| Less: Allowance for doubtful accounts | (8366) | (8472) | (8323) | (1140) |
|  | **6993** | **10816** | **9466** | **1297** |

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As of the fiscal year ended December 31, 2022 and 2023, the balance of advance to suppliers mainly represented the prepayments in relation to the development and purchase of battery-swapping stations as well as the development of UOTTA-powered EVs. As of the fiscal year ended December 31, 2024, the balance of advance to suppliers mainly represented the prepayments in relation to the development of vehicle sourcing and purchase of battery-swapping stations. An analysis of the expected credit losses was as follows:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Balance at beginning of the year |  | (8366) | (8472) | (1161) |
| Additional (allowance)/reversal for expected credit losses | (8366) | (106) | 149 | 21 |
| Balance at the end of the year | **(8366)** | **(8472)** | **(8323)** | **(1140)** |

---

**8. OTHER CURRENT AND NONCURRENT ASSETS**

Other current assets consisted of the following:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Value-added tax recoverable | 7976 | 8887 | 8061 | 1104 |
| Loans to third parties (i) | 21635 | 18827 | 21305 | 2919 |
| Refund receivable from supplier | 2746 | 2746 |  |  |
| Prepayment (ii) |  | 42599 |  |  |
| Deposit in Escrow account (iii) |  | 21300 |  |  |
| Deposits | 1218 | 1828 | 4590 | 628 |
| Staff advances | 1178 | 422 | 708 | 97 |
| Others | 599 | 692 | 705 | 97 |
| Less: Allowance for doubtful accounts | (1435) | (2488) | (6337) | (868) |
|  | **33917** | **94813** | **29032** | **3977** |

---

(i) In January 2023, LY New Energy, Youpin, Youxu
Zibo and HN Youxu, respectively, entered into an one-year loan agreement signed annually with Shanghai Huazhen Construction Engineering
Co., Ltd ("SH Huazhen"), pursuant to which LY New Energy, Youpin, Youxu Zibo and HN Youxu were entitled to borrow a total
loan amount of RMB12,560 (US$1,769) with free interest rate for working capital needs of SH Huazhen. As of December 31, 2024, the balance
of loans to SH Huazhen is RMB12,774 (US$1,750). SH Huazhen has provided assurances regarding the repayment schedule of the relevant borrowings,
committing to fully settle all outstanding liabilities within one year. As of April 30, 2025, Huazhen has repaid RMB 1,000. In December 2023, Youguan Financial Leasing entered
into a one-year loan agreement with Cao Yue, Gong Hua and He Guangquan for revolving loan quota, each quota of RMB2.4 million, pursuant
to which Youguan Financial Leasing were entitled to borrow a total loan amount of RMB3,000 with free interest rate. As of this period,
the loan balance is RMB992 (US$136). In May 2023, U Power Limited entered into a one-year loan agreement
with BITTO LTD, pursuant to which U Power Limited were entitled to borrow a total loan amount of US$460 with free interest rate for working
capital needs of BITTO LTD. Due to the deterioration of the Company's operating conditions, management has concluded that BITTO
LTD no longer possesses the capacity to repay the borrowings. Accordingly, a full impairment loss has been recognized against these borrowings
in the current period. Consequently, the balance of loans to BITTO LTD is nil, as of December 31, 2024.

(ii) On April 18, 2023, the Company entered into a consulting agreement
with Richness Fortune Credit (HK) and prepaid for the service and the consideration for the purchase of the target company in the total
amount of Six Million Dollars (US$6,000), of which the intermediary fee is US$0.5 million, and the target company is valued at US$5.5
million. In 2024, Richness Fortune Credit (HK) recommended multiple potential investment targets to the Group. However, as these targets
failed to meet management's investment expectations, the Group entered into a supplemental agreement with Richness Fortune Credit
(HK) to extend the collaboration period until December 31, 2028. The agreement stipulates the payment of a capital occupancy fee at an
agreed-upon rate for the extended period.

(iii) On December 4, 2023, the Company entered into an Escrow Agreement with
an escrow agent named Ortoli Rosenstadt LLP, pursuant to which upon the closing of the Offering, the Company has agreed to deposit an
aggregate amount of Three Million Dollars (US$3,000) from the proceeds of the Offering to be received by the Company with the Escrow Agent
in an escrow account, to be held and disbursed by the Escrow Agent pursuant to the terms and conditions of the Escrow Agreement. The funds
deposited in the Escrow Account, as such amount may be released or returned pursuant to the agreement terms. In 2024, according to the
investment agreement, the investor withdrew the funds from the custody account.

An analysis of the allowance for doubtful accounts was as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Balance at beginning of the year |  | (1435) | (2488) | (343) |
| Additional allowance charged to expense | (1435) | (1053) | (3849) | (525) |
| Balance at the end of the year | **(1435)** | **(2488)** | **(6337)** | **(868)** |

---

Other non-current assets consisted of the following:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Loans to third parties (iv) | 30 | 36029 | 81552 | 11173 |
| Long-term deferred expenses (v) |  | - | 181 | 25 |
|  | **30** | **36029** | **81733** | **11198** |

---

(iv) On March 31, 2023, the Company entered into a
five-year loan agreement with Worthy Credit Limited ("Worthy Credit"), pursuant to which the Company provides a loan of $5,000
to Worthy Credit bearing an interest rate of 2% per annual. Worthy Credit shall provide loan services to the Company's customers
who purchase the Company's products sold in HK. As a result, the Company shall expect to promote its sourcing services, product
sales as well as battery-swapping services in HK area. Consequently, the loan is not yet to be granted to any customers due to the fact
that the Company's vehicle product is still at certification stage and there is no contract entered into yet with any dealers or
purchasers of battery swapping stations. However, the Group's first batch of battery swap station equipment has been successfully
delivered to Hong Kong, with substantive cooperation established with local enterprises regarding equipment installation and operational
management. Consequently, the Group anticipates that the project's progress will align with initial expectations, and the collaborative
business with Worthy Credit is expected to proceed. In April 2023, the Group entered into a cooperation
agreement with Richness Fortune Credit (HK) Company Limited ("Richness"), whereby the Group agreed to provide a $6,000 loan
to facilitate Richness' identification of potential investment targets. However, due to persistent weakness in the primary investment
market, the investment opportunities presented by Richness failed to meet management's expectations, resulting in the funds remaining
unutilized. Subsequently, in 2024, the Group and Richness executed an amendment agreement that: Extends the cooperation term through December 2028; Implements an annual
interest charge of $600,000, commencing in 2025.

(v) On September 11, 2024, Youxu Zibo entered into a design service contract
with Shanghai Kunying Technology Co., Ltd. for battery swap station projects. Under the agreement, design service costs are recognized
in accordance with the construction progress of the respective battery swap stations. Costs related to uncompleted stations that have
not passed final inspection are capitalized as long-term deferred expenses. As of December 31, 2024, the Company had RMB 181,000 in unamortized
design fees capitalized under long-term deferred expenses.

**9. PROPERTY, PLANT AND EQUIPMENT, NET**

Property, plant and equipment consisted of the following:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Leasehold improvements | 754 | 754 | 534 | 73 |
| Computer and electronic equipment | 1235 | 1930 | 2457 | 337 |
| Manufacturing equipment | 12422 | 12501 | 12460 | 1707 |
| Office equipment | 187 | 187 | 288 | 40 |
| Motor vehicles | 3896 | 3914 | 4367 | 598 |
| Construction in process | 1948 | 1056 | - | - |
|  | **20442** | **20342** | **20106** | **2755** |
| Less: loss of impairment |  | (1896) | (1896) | (260) |
| Less: accumulated depreciation | (4160) | (6682) | (9554) | (1309) |
|  | **16282** | **11764** | **8656** | **1186** |

---

For the years ended December 31, 2022, 2023, and 2024, the Group recorded depreciation expenses of RMB2,429, RMB2,522, and RMB 2,872 respectively. There was nil, RMB1,896, and RMB1,896 of impairment of property, plant and equipment recognized as of the years ended December 31, 2022 and 2023, respectively.

The loss of the impairment was due to the permanent withdrawn of a production line built in 2023.

**10. INTANGIBLE ASSETS, NET**

The following table presents the Group's intangible assets as of the respective balance sheet dates:

---

| | | |
|:---|:---|:---|
|  | **Purchased software**<br>**RMB** | **Total**<br>**RMB** |
| **Net balance as of December 31, 2022** | 286 | 286 |
| Amortization expense | (85) | (85) |
| **Net balance as of December 31, 2023** | 201 | 201 |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Purchased software**<br>**RMB** | **Total**<br>**RMB** | **Total**<br>**US$** |
| **Net balance as of December 31, 2023** | 201 | 201 | 28 |
| Additions |  |  |  |
| Amortization expense | (69) | (69) | (10) |
| **Net balance as of December 31, 2024** | **132** | **132** | **18** |

---

The intangible assets are amortized using the straight-line method, which is the Group's best estimate of how these assets will be economically consumed over their respective estimated useful lives of one to ten years.

Amortization expenses for intangible assets were RMB85, RMB85, and RMB69 for the years ended December 31, 2022, 2023, and 2024, respectively.

The annual estimated amortization expenses for the intangible assets for each of the next two years are as follows:

---

| | | |
|:---|:---|:---|
|  | **RMB** | **US$** |
| 2026.0 | 70 | 10 |
| 2027.0 | 62 | 8 |
|  | **132** | **18** |

---

**11. LONG-TERM INVESTMENTS**

The Group's long-term investments consisted of the following:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Zibo Hengxin Investment Partnership (Limited Partnership) ("Zibo Hengxin") (i) | 110000 | 120000 | 120006 | 16441 |
| Huzhou Zheyou New Energy Sales Co., Ltd. ("Huzhou Zheyou") (ii) | 1711 | 3367 | 3121 | 428 |
| Chengdu Zhibo Premium Technology Co., Ltd. ("Chengdu Zhibo") (iii) | 100 | 100 |  |  |
| MATSON (HONG KONG) (iv) |  |  | 20773 | 2846 |
| UNEX EV B.V (v) | - | - | 717 | 98 |
| Less: impairment on equity investments | - | (100) | (10503) | (1439) |
|  | **111811** | **123367** | **134114** | **18374** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(i) In December 2020, the Group entered into a partnership
 agreement with Zibo Hengxin Investment Partnership (Limited Partnership) and its participating shareholder, Guanmiao (Beijing) Investment
 Management Co., Ltd. ("Guanmiao"), whereby the Group agreed to purchased limited partnership interest in Zibo Hengxin Investment
 Fund Partnership (Limited Partnership) (the "Fund") in the amount of RMB120,000, which entitles the Group an aggregate interest
 of approximately 99% in the Fund. In December 2021, the Fund decreased the total partnership capital to RMB111,200 and returned to the
 Group by RMB10,000 and the aggregate interest of the Group was subsequently diluted to 98.9%. In October 2023, the Group entered RMB10,000
 into Zibohengxin Investment Partnership, and the Group accounted aggregate interest of approximately 99% in the Fund. There was no unfunded
 commitment to the Fund as of December 31, 2024. In 2024, the Group made an impairment provision of about RMB10.5 million (US$1.4 million)
 for this long-term equity investment. The Fund's investment strategy is primarily
 to invest in emerging companies of new energy automobile industry. The Fund is scheduled to be in existence until 2025, unless terminated
 sooner or extended in accordance with the amended and restated limited partnership agreement.

&nbsp;&nbsp;&nbsp;&nbsp;(ii) In April 2022, the Group entered into an agreement to invest in Huzhou
Zheyou New Energy Sales Co., Ltd. ("Huzhou Zheyou"), with contributed RMB1,750 in June 2022 and RMB1,750 in November 2023,
respectively. The Group held an equity interest of 35% as of December 31, 2024. For the fiscal year ended December 31, 2024, the Group
recorded an investment loss of RMB246 from the operating result of Huzhou Zheyou. The investment losses have been disclosed in share of
loss in equity method investee of consolidated statement of cash flow.

&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Group entered into an agreement to invest in Chengdu Zhibo Premium
Technology Co., Ltd. ("Chengdu Zhibo"), and contributed RMB100 in November 2022. The Group held an equity interest of 40%.
For the fiscal year ended December 31, 2024, the Group recognized RMB100 (US$14) of impairment of long-term equity investments, and verified
the long-term equity investment of Chengdu Zhibo.

&nbsp;&nbsp;&nbsp;&nbsp;(iv) On February 6, 2024, the Company and Zeng Lingzhi, the sole beneficial
owner of Matson, a private company with limited liability incorporated under the laws of Hong Kong, entered into a share exchange agreement,
pursuant to which agreement, the Company agreed to acquire 3,560 ordinary shares of Matson, which represent 26.25% of Matson's total
equity, for 30,000,000 ordinary shares of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;(v) The Group entered into an agreement to invest in UNEX EV B.V, and contributed
RMB736 on July 14, 2024. The Group held an equity interest of 9% of UNEX EV B.V. For the fiscal year ended December 31, 2024, the Group
verified the long-term equity investment of UNEX EV B.V.

**12. REFUNDABLE DEPOSIT FOR INVESTMENT**

The balance represented loans to Shanghai Lingneng Electricity Selling Co., Ltd. ("SH Lingneng") for its operations pursuant to loan agreements entered into in 2019, bearing an interest rate of 3% per annum. Subsequently in August 2023, the Company entered into a term sheet, the result of which would be the investment into SH Lingneng's interest equity ("Transaction"). Final terms and arrangements of this potential Transaction would be determined on Share Purchase Agreement ("SPA"), Shareholders' Agreement ("SHA"), Memorandum of Association ("MA") and other documents associated with the Transaction. As of December 31, 2022, the balance of the refundable deposit for investment is RMB80,183, the Company has recovered RMB7,409 of the refundable investment funds in 2023, and the balance of the refundable deposit for investment is RMB72,774 (US$10,250) as of December 31, 2023. On February 28, 2024, the Company entered into an investment termination agreement, pursuant to which Shanghai Lingneng shall pay no less than one third of the total amount per annum in the following three years. As of the date of this annual report, the Company has received a refund of RMB32,975 (US$4,518).

**13. BANK BORROWINGS**

Bank borrowings were as follows as of the respective balance sheet dates:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Short-term bank borrowing (i) |  | 5000 | 15172 | 2078 |
| Long-term bank borrowing, current portion (ii) |  | 9500 | 2800 | 384 |
| Long-term bank borrowing, non-current portion (ii) | 10000 | - | 3700 | 507 |
|  | **10000** | **14500** | **21672** | **2969** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(i) During fiscal year 2024, both Shanghai Youxu and Youpin Shandong fully
repaid their aggregate short-term bank borrowings of RMB5,000 originally obtained in 2023. Subsequent to these repayments, Youpin Shandong
entered into new one-year short-term bank loans of RMB282 on August 19, 2024, carrying an annual interest rate of 3.95%, followed by an
additional RMB890 loan on August 21, 2024, with an annual interest rate of 3.75%. Separately, Shanghai Youxu obtained two one-year short-term
bank facilities: RMB10,000 on August 16, 2024 and RMB4,000 on September 29, 2024, both bearing an annual interest rate of 3.45% and the
initial loan agreement stipulates that Jia Li serves as a co-borrower under this financing arrangement, assuming joint and several liability
for repayment obligations.

&nbsp;&nbsp;&nbsp;&nbsp;(ii) During 2024, Youxu Zibo repaid RMB3,000 of its bank borrowings from
Qishang Bank. On December 6, 2024, the company entered into a renewal agreement with Qishang Bank to extend the remaining RMB6,500 loan
to June 3, 2026, maintaining the original annual interest rate of 6.87%.

**14. ACCRUED EXPENSES AND OTHER LIABILITIES**

Accrued expenses and other liabilities consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2023** |
|  | **RMB** | **RMB** | **US$** |
| Payroll and welfare payables | 1846 | 5753 | 810 |
| Loans from third parties | 13104 | 17819 | 2510 |
| Payable to Wuyi Transportation Construction (i) |  | 5200 | 732 |
| Other payables |  | 662 | 93 |
| Interest payables | 639 | 1100 | 155 |
| Customer deposit | 301 | 334 | 47 |
| Payables for purchase of property, plant and equipment | 964 | 1311 | 185 |
| Accrued expenses | 10928 | 332 | 47 |
| Deferred consideration in relation to investment (ii) | 5300 | 2300 | 324 |
| Others | 653 | 420 | 59 |
|  | **33735** | **35231** | **4962** |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **US$** |
| Payroll and welfare payables | 5753 | 4856 | 666 |
| Loans from third parties (iii) | 17819 | 4787 | 656 |
| Payable to Wuyi Transportation Construction (i) | 5200 |  |  |
| Payable to Anhui Juhu (iv) |  | 200 | 27 |
| Other payables | 662 |  |  |
| Interest payables | 1100 |  |  |
| Customer deposit | 334 | 363 | 50 |
| Payables for purchase of property, plant and equipment | 1311 |  |  |
| Accrued expenses | 332 | 334 | 46 |
| Deferred consideration in relation to investment (ii) | 2300 | 2300 | 315 |
| Others | 420 | 441 | 59 |
|  | **35231** | **13281** | **1819** |

---

(i) The payable to Wuyi
 Transportation Construction is discussed in Note 16 - Loan payables.

(ii) In June 2021, AHYS and Youpin entered into an equity transfer agreement
with Ningbo Tuowei Equity Investment Partnership (Limited Partnership) ("Ningbo Tuowei"), a shareholder who owned 0.5533%
share equity of Youpin. Pursuant to the agreement, Ningbo Tuowei agreed to transfer its all 0.5533% share equity of Youpin for a total
consideration of RMB6,000 to AHYS. As of December 31, 2024, the outstanding balance of this deferred consideration was RMB2,300 (US$315).
Please refer to Note 23- Subsequent events.

(iii) As of February 29, 2024, all loans from third parties were classified
as current liabilities, as they mature within one year. The outstanding interest payable on these borrowings amount to approximately RMB200.

(iii) In February 2023, Youpin was sued by Anhui Juhu Doors & Windows
Technology Co., Ltd. for alleged unpaid rent in the amount of RMB3,245 (approximately US$457). Youpin entered into a settlement agreement
with the plaintiff on July 29, 2024, pursuant to which the final payable amount was determined to be RMB2,000. As of December 31, 2024,
Youpin had RMB200 of the settlement amount remaining unpaid. Accordingly, the Company reclassified this obligation from commitments and
contingencies to accrued expenses and other liabilities in the consolidated financial statements.

**15. LEASES**

The Company leases buildings, office facilities, land use rights and batteries in PRC. The Company does not have any finance lease for the years ended December 31, 2022, 2023, and 2024. Operating leases result in the recognition of right-of-use ("ROU") assets and lease liabilities on the balance sheet. ROU assets represent the Company's right to use the leased asset for the lease term, and lease liabilities represent the obligation to make lease payments. The operating lease expenses were charged to cost of sales, research and development expenses and general and administrative expenses.

A summary of supplemental information related to operating leases as of December 31, 2022, 2023, and 2024 was as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Operating lease right-of-use assets, net | 19250 | 21656 | 16205 | 2220 |
| Operating lease liabilities, current | 1696 | 1750 | 1843 | 252 |
| Operating lease liabilities, non-current | 4789 | 5980 | 4137 | 567 |
| Weighted average remaining lease terms | 3.79 years | 3.56 years | 3.22 years |  |
| Weighted average discount rate | 4.41% | 4.36% | 4.64% |  |

---

Cashflow information related to leases consists of the following:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Right-of-use assets obtained in exchange for new operating lease liabilities | 6603 | 4698 |  |  |
| Derecognition of right-of use-assets | 7408 |  |  |  |
| Derecognition of lease liabilities | 5658 |  |  |  |

---

Future lease payments under operating leases as of December 31, 2024 were as follows:

---

| | |
|:---|:---|
|  | **As of<br> December 31, <br> 2024** |
|  | **RMB** |
| FY2025 | 2075 |
| FY2026 | 1860 |
| FY2027 | 1143 |
| FY2028 | 714 |
| FY2029 | 426 |
| FY2030 | 293 |
| Total future lease payment | 6511 |
| less: imputed interest | (531) |
| Represent value of future lease payments<sup>(1)</sup> | **5980** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Present value of future
 operating lease payments consisted of current portion of operating lease liabilities and non-current portion of operating lease
 liabilities, amounting to RMB1,843 (US$252) and RMB4,137 (US$567) for the fiscal year ended December 31, 2024,
 respectively.

**16. LOAN PAYABLES**

Loan payables were as follows as of the respective balance sheet dates:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2022** | **2023** | **2023** |
|  | **RMB** | **RMB** | **RMB** | **RMB** |
| Loan payables, current portion |  | 6500 |  |  |
| Loan payables, non-current portion | | - | | - |
|  | | **6,500** | | **-** |

---

On September 17, 2020, Zhejiang Youguan Automobile Service Co., Ltd. ("ZJ Youguan") entered into a loan agreement with WuYi Transportation Construction Investment Group Company Limited ("WuYi Transportation Construction"), pursuant to which ZJ Youguan was entitled to borrow a loan of RMB20,000 with a weighted average interest rate of 7.5%. ZJ Youguan drew down the amount in full. On July 1, 2021, ZJ Youguan entered into a supplementary agreement with WuYi Transportation Construction, pursuant to which ZJ Youguan shall fully repay this loan by the end of 2021. ZJ Youguan repaid RMB10,000 on July 27, 2021, RMB2,000 on October 29, 2021, RMB1,000 on December 29, 2021, and RMB500 on July 29, 2022. On June 13, 2023, ZJ Youguan entered into a settlement agreement with WuYi Transportation Construction, pursuant to which the ZJ Youguan agreed to repay all the outstanding balance of RMB6,500 before December 15, 2023. ZJ Youguan repaid RMB800 on September 1, 2023 and RMB500 on November 3, 2023, respectively. As of December 31, 2024, the outstanding balance of this loan was RMB5,200, which was overdue. The Group reclassified to Note 14 - ACCRUED EXPENSES AND OTHER LIABILITIES - Loans from third parties as the nature of this transaction has changed to a liability other than loan payable. Relevant legal proceedings are discussed in Note 23 - SUBSEQUENT EVENTS.

**17. RELATED PARTY TRANSACTIONS**

Major related parties that transacted with the Group and their respective relationship to the Group listed as below:

---

| | |
|:---|:---|
| **Names of the related parties** | **Relationship with the Group** |
| Hangzhou Youyue Travel Technology Co., Ltd. ("Hangzhou Youyue") | An affiliate of Bingyi Zhao |
| Shanghai Youzhang Commerical Information Consulting Partnership (Limited Partnership) ("Shanghai Youzhang") | An affiliate of Jia Li |
| Ningbo Youheng Automobile Service Co., Ltd. ("Ningbo Youheng Automobile" | An affiliate of Jia Li |
| Zhejiang Youxiaodian Automobile Service Co., Ltd. ("Zhejiang Youxiaodian") | An affiliate of Jia Li |
| Qingshan Wei | Controlling shareholder of U Power Limited |
| Youjia Technology (Shanghai) Co., Ltd. ("Youjia Technology") | An affiliate of Jia Li |
| Shanghai Youpinsuoer New Energy Technology Co., Ltd. ("Shanghai Youpinsuoer") | An affiliate of Jia Li |
| Jia Li | Controlling shareholder, Director and CEO of U Power Limited |
| Bingyi Zhao | Director and Chief Financial Officer of U Power Limited |
| Shandong Youyidian Automobile Technology Co., Ltd. ("Shandong Youyidian") | An affiliate of Jia Li |
| Youche Jingpin E-commerce (Shanghai) Co., Ltd. ("Youche Jingpin") | An affiliate of Jia Li |
| Shanghai Youcang Business Consulting Partnership (Limited Partnership) ("Shanghai Youcang") | An affiliate of Jia Li |
| Nanmu (Shanghai) Financial Leasing Co., Ltd("Nanmu") | An affiliate of Jia Li |
| Ke Li | Director of U Power Limited |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **Amounts due from related parties** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Nanmu (Shanghai) Financial Leasing Co., Ltd |  |  | 20001 | 2740 |
| Jia Li |  |  | 583 | 80 |
| Ke Li |  |  | 438 | 60 |
| Youche Jingpi | 20 | 20 |  |  |
| Shanghai Youcang | 100 | 111 | 100 | 14 |
| Bingyi Zhao | - | 11 | 535 | 73 |
|  | **120** | **142** | **21657** | **2967** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **Amounts due to related parties** 

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **As of December 31,** | **As of December 31,** | **As of December 31,** | **As of December 31,** |
|  | **2022** | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| Li Ke |  | 4170 | 3020 | 414 |
| Jia Li | 228 | 582 |  |  |
| Bingyi Zhao | 23 | 673 | 219 | 30 |
| Hangzhou Youyue | - | 6 | - | - |
|  | **251** | **5431** | **3239** | **444** |

---

**18. *EMPLOYEE BENEFIT EXPENSES***

All eligible employees of the Group are entitled to staff welfare benefits including medical care, welfare subsidies, unemployment insurance and pension benefits through a PRC government-mandated multi-employer defined contribution plan. The Group is required to make contributions to the plan and accrues these benefits based on certain percentages of the qualified employees' salaries. The Group recorded employee benefit expenses of RMB2,253, RMB1,644, and RMB 2,529(US$346) for the years ended December 31, 2022, 2023, and 2024, respectively.

**19. INCOME TAXES**

 ****

***Cayman Islands***

The Company is incorporated in the Cayman Islands and conducts its primary business operations through the subsidiaries in the PRC and Hong Kong. Under the current laws of the Cayman Islands, the Cayman Islands levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and the Company is therefore not subject to tax on income or capital gains arising in Cayman Islands.

 ****

***British Virgin Islands***

Subsidiaries in British Virgin Islands are not subject to tax on income or capital gains under the current laws of the British Virgin Islands. Additionally, upon payments of dividends by the Company to its shareholders, no British Virgin Islands withholding tax will be imposed.

 ****

***Hong Kong***

Subsidiaries in Hong Kong are subject to a two-tiered income tax rate for taxable income earned in Hong Kong. The first 2,000 Hong Kong dollars of profits earned by a company is subject to be taxed at an income tax rate of 8.25%, while the remaining profits will continue to be taxed at the existing tax rate of 16.5%. No provision for Hong Kong profits tax has been made in the consolidated financial statements as it has no assessable profit for the years ended December 31, 2022, 2023, and 2024.

 ****

***PRC***

The Company's PRC subsidiaries are incorporated in the PRC and subject to the statutory rate of 25% on the taxable income in accordance with the Enterprise Income Tax Law (the "EIT Law"), which was effective since January 1, 2008, except for certain entities eligible for preferential tax rates.

Dividends, interests, rent or royalties payable by the Company's PRC subsidiaries, to non-PRC resident enterprises, and proceeds from any such non-resident enterprise investor's disposition of assets (after deducting the net value of such assets) shall be subject to 10% withholding tax, unless the respective non-PRC resident enterprise's jurisdiction of incorporation has a tax treaty or arrangements with China that provides for a reduced withholding tax rate or an exemption from withholding tax.

The EIT Law also provides that enterprises established under the laws of foreign countries or regions and whose "place of effective management" is located within the PRC are considered PRC tax resident enterprises and subject to PRC income tax at the rate of 25% on worldwide income. The definition of "place of effective management" refers to an establishment that exercises, in substance, overall management and control over the production and business, personnel, accounting, properties, etc. of an enterprise.

As of December 31, 2024, the administrative practice associated with interpreting and applying the concept of "place of effective management" is unclear. If the Company is deemed as a PRC tax resident, it will be subject to 25% PRC enterprise income tax under the EIT Law on its worldwide income, meanwhile the dividend it receives from another PRC tax resident company will be exempted from 25% PRC income tax. The Company will continue to monitor changes in the interpretation or guidance of this law.

Loss before income taxes consisted of:

---

| | | | |
|:---|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** | **Years ended December 31,** |
|  | **2022** | **2023** | **2023** |
|  | **RMB** | **RMB** | **US$** |
| Non-PRC |  | (3610) | (508) |
| PRC | (57662) | (19243) | (2711) |
|  | **(57662)** | **(22853)** | **(3219)** |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** | **Years ended December 31,** |
|  | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **US$** |
| Non-PRC | (3610) | (14742) | (2019) |
| PRC | (19243) | (41620) | (5702) |
|  | **(22853)** | **(56362)** | **(7221)** |

---

The following table presents the composition of income tax expenses for the years ended December 31, 2022, 2023, and 2024:

---

| | | | |
|:---|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** | **Years ended December 31,** |
|  | **2022** | **2023** | **2023** |
|  | **RMB** | **RMB** | **US$** |
| Current income tax expense | (5) | (2613) | (368) |
| Deferred income tax expense | - | - | - |
|  | **(5)** | **(2613)** | **(368)** |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** | **Years ended December 31,** |
|  | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **US$** |
| Current income tax expense | (2613) |  |  |
| Deferred income tax expense | - |  |  |
|  | **(2613)** |  |  |

---

The reconciliation of the effective tax rate and the statutory income tax rate applicable to PRC operations are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** | **Years ended December 31,** |
|  | **2022** | **2023** | **2023** |
|  | **RMB** | **RMB** | **US$** |
| Loss before provision for income taxes | (57662) | (22853) | (3219) |
| Income tax benefit computed at an applicable tax rate of 25% | (14416) | (5713) | (805) |
| Prior year provision to return true up | 3800 |  |  |
| Change in valuation allowance | 10611 | 3100 | 437 |
|  | **(5)** | **(2613)** | **(368)** |

---

 ****

---

| | | | |
|:---|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** | **Years ended December 31,** |
|  | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **US$** |
| Loss before provision for income taxes | (22853) | (56362) | (7721) |
| Income tax benefit computed at an applicable tax rate of 25% | (5713) | (14091) | (1930) |
| Prior year provision to return true up |  | 659 | 90 |
| Change in valuation allowance | 3100 | 13432 | 1840 |
|  | **(2613)** | **-** | **-** |

---

***Deferred Taxes***

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Group's deferred tax assets and deferred tax liabilities are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** | **Years ended December 31,** |
|  | **2022** | **2023** | **2023** |
|  | **RMB** | **RMB** | **US$** |
| **Deferred tax assets:** |  |  |  |
| Intra-group transaction | 35151 | 32051 | 4514 |
| **Total deferred tax assets** | **35151** | **32051** | **4514** |
| Less: valuation allowance | (35151) | (32051) | (4514) |
| **Deferred tax assets, net** | **-** | **-** | **-** |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **Years ended December 31,** | **Years ended December 31,** | **Years ended December 31,** |
|  | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **US$** |
| **Deferred tax assets:** |  |  |  |
| Intra-group transaction | 32051 | 45483 | 6231 |
| **Total deferred tax assets** | **32051** | **45483** | **6231** |
| Less: valuation allowance | (32051) | (45483) | (6231) |
| **Deferred tax assets, net** | **-** | **-** | **-** |

---

Realization of the net deferred tax assets is dependent on factors including future reversals of existing taxable temporary differences and adequate future taxable income, exclusive of reversing deductible temporary differences and tax loss carry forwards. The Group evaluates the potential realization of deferred tax assets on an entity-by-entity basis.

As of December 31, 2022, 2023, and 2024, valuation allowances were mainly provided against deferred tax assets caused by net operating losses carried forward in entities where it was determined that it was more likely than not that the benefits of the deferred tax assets will not be realized due to their recurring losses.

According to PRC tax regulations, the PRC net operating loss can generally carry forward for no longer than five years starting from the year subsequent to the year in which the loss was incurred. Carryback of losses is not permitted.

As of December 31, 2022, 2023, and 2024, net operating tax loss carry forwards in PRC is expected to expire as follows:

---

| | | |
|:---|:---|:---|
|  | **As of December 31, 2022** | **As of December 31, 2022** |
|  | **RMB** | **US$** |
| **Net Operating Tax Loss Carry Forward:** | | |
| 2023 | 716 | 104 |
| 2024 | 21197 | 3073 |
| 2025 | 12820 | 1859 |
| 2026 | 15466 | 2242 |
| 2027 | 54871 | 7956 |
|  | **105070** | **15234** |

---

---

| | | |
|:---|:---|:---|
|  | <br>**As of December 31, 2023** | <br>**As of December 31, 2023** |
|  | **RMB** | **US$** |
| **Net Operating Tax Loss Carry Forward:** | | |
| 2024 | 21197 | 2986 |
| 2025 | 12820 | 1806 |
| 2026 | 15059 | 2121 |
| 2027 | 39743 | 5598 |
| 2028 | 26873 | 3785 |
|  | **115692** | **16296** |

---

 ****

---

| | | |
|:---|:---|:---|
|  | **As of December 31, 2024** | **As of December 31, 2024** |
|  | **RMB** | **US$** |
| **Net Operating Tax Loss Carry Forward:** | | |
| 2025 | 12820 | 1756 |
| 2026 | 11465 | 1571 |
| 2027 | 39695 | 5438 |
| 2028 | 26870 | 3681 |
| 2029 | 62872 | 8613 |
|  | **153722** | **21059** |

---

***Uncertain tax positions***

The Group evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of December 31, 2022, 2023, and 2024, the Group did not have any significant unrecognized uncertain tax positions.

The Group did not accrue any liability, interest or penalties related to uncertain tax positions in its provision for income taxes line of its consolidated statements of operations for the years ended December 31, 2022, 2023, and 2024.

**20. RESTRICTED NET ASSETS**

Relevant PRC statutory laws and regulations permit payments of dividends by the Group's PRC subsidiaries only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The results of operations reflected in the financial statements prepared in accordance with U.S. GAAP differ from those reflected in the statutory financial statements of the Company's subsidiaries.

In accordance with the Regulations on Enterprises with Foreign Investment of China, a foreign invested enterprise established in the PRC is required to provide certain statutory reserves, namely general reserve fund, enterprise expansion fund, and staff welfare and bonus fund which are appropriated from net profit as reported in the enterprise's PRC statutory accounts, which is included in retained earnings accounts in equity section of the consolidated balance sheets. A wholly foreign owned invested enterprise is required to allocate at least 10% of its annual after-tax profit to the general reserve until such reserve reaches 50% of its respective registered capital based on the enterprise's PRC statutory accounts.

Appropriations to the enterprise expansion fund and staff welfare and bonus fund are at the discretion of the board of directors for all foreign invested enterprises. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. If any PRC subsidiary incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other payments to the Group. Any limitation on the ability of the PRC subsidiaries to distribute dividends or other payments to their respective shareholders could materially and adversely limit the ability to grow, make investments or acquisitions that could be beneficial to pay dividends.

Additionally, in accordance with the Company Law of the PRC, a domestic enterprise is required to provide a statutory common reserve of at least 10% of its annual after-tax profit until such reserve reaches 50% of its respective registered capital based on the enterprise's PRC statutory accounts. The Group's provision for the statutory common reserve is in compliance with the aforementioned requirement of the Company Law. A domestic enterprise is also required to provide for discretionary surplus reserve, at the discretion of the board of directors, from the profits determined in accordance with the enterprise's PRC statutory accounts. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. For the years ended December 31, 2022, 2023 and 2024, the PRC subsidiaries did not have after-tax profit, and therefore, no statutory reserves were allocated.

Because the Group's entities in the PRC can only be paid out of distributable profits reported in accordance with PRC accounting standards, the Group's entities in the PRC are restricted from transferring a portion of their net assets to the Company. The restricted amounts include the paid-in capital and additional paid-in capital of the Group's entities in the PRC. The aggregate amount of paid-in capital and additional paid-in capital, which is the amount of net assets of the Group's entities in the PRC (mainland) not available for distribution, were RMB383,980, RMB585,991, and RMB818,712 (US$112,163) as of December 31, 2022, 2023, and 2024, respectively.

**21. LOSS PER SHARE**

Basic and diluted earnings per share for the years presented were calculated as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the years ended December 31,** | **For the years ended December 31,** | **For the years ended December 31,** |
|  | **2022** | **2023** | **2023** |
|  | **RMB** | **RMB** | **US$** |
| ***Numerator:*** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss | (57667) | (25466) | (3587) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less: net loss attributable to noncontrolling interest | (11746) | (6128) | (863) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net loss attributable to the Company's shareholders** | **(45921)** | **(19338)** | **(2724)** |
| &nbsp;&nbsp;&nbsp;***Denominator:*** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Weighted average number of ordinary shares outstanding used in calculating basic and diluted earnings per share | 500000 | 1243140 | 1243140 |
| &nbsp;&nbsp;&nbsp;**Basic and diluted earnings per share:** | **(91.84)** | **(15.56)** | **(2.19)** |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **For the years ended December 31,** | **For the years ended December 31,** | **For the years ended December 31,** |
|  | **2023** | **2024** | **2024** |
|  | **RMB** | **RMB** | **US$** |
| ***Numerator:*** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss | (25466) | (56362) | (7721) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less: net loss attributable to noncontrolling interest | (6128) | (8440) | (1156) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net loss attributable to the Company's shareholders** | **(19338)** | **(47922)** | **(6565)** |
| &nbsp;&nbsp;&nbsp;***Denominator:*** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Weighted average number of ordinary shares outstanding used in calculating basic and diluted earnings per share | 1243140 | 2854594 | 2854594 |
| &nbsp;&nbsp;&nbsp;**Basic and diluted earnings per share:** | **(15.56)** | **(16.79)** | **(2.30)** |

---

**22. COMMITMENTS AND CONTINGENCIES**

 ****

***Commitments***

The assets pledged as collaterals for loans of the Group is discussed in Note 13 BANK BORROWINGS.

 ****

The following table sets forth the Group's contractual obligations as of December 31, 2024:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** |
|  | **Total** | **Total** | **Less than<br> 1 year** | **1-3 years** | **3-5 years** | **More than<br> 5 years** |
|  | **RMB** | **US$** | | | | |
| Long-term bank borrowings (i) | 6970 | 955 | 3164 | 3806 |  |  |
| Short-term bank borrowing | 15522 | 2127 | 15522 |  |  |  |
| Loans from third parties (ii) | 4787 | 656 | 4787 |  |  |  |
| Operating lease liabilities (iii) | 7099 | 973 | 2262 | 3274 | 1244 | 319 |
| Payment to Anhui Juhu | 200 | 27 | 200 |  |  |  |
| **Total** | **34578** | **4738** | **25935** | **7080** | **1244** | **319** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(i) The Group's commitment for long-term bank borrowings and short-term bank borrowings as of December 31, 2024 is discussed in Note 13 BANK BORROWINGS.

&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Group's commitment for minimum lease payments under the remaining operating leases as of December 31, 2024 is discussed in Note 15 LEASES.

&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Group's commitment for payable to Anhui Juhu under the other current liabilities as of December 31, 2024 is discussed in Note 14 ACCRUED EXPENSES AND OTHER LIABILITIES.

Other than as shown above, the Group did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2024.

***Contingencies***

The Group is subject to legal proceedings and regulatory actions in the ordinary course of business. The results of such proceedings cannot be predicted with certainty, but the Group does not anticipate that the final outcome arising out of any such matter will have a material adverse effect on the Group's consolidated business, financial position, cash flows or results of operations taken as a whole.

On July 1, 2021, Youpin Automobile Service Group Co., Ltd. ("Youpin") signed an Investment Contract with the Wuhu High-Tech Industrial Development Zone Management Committee (the "Committee") for a new energy vehicle industrial cluster project. Youpin set up Wuhu Youxu New Energy Technology Co., Ltd. as the project company, and the Committee agreed to provide financial subsidies. On October 15, 2021, the Committee paid the first-year rental subsidy (RMB 3 million) to the project company. However, because Youpin and the project company failed to meet operational targets, the Committee issued an Administrative Decision on August 29, 2024, demanded youpin to repay the RMB 3 million subsidy.

The Group reckon that the investment contract does not qualify as an administrative agreement, and defendant lacks authority to issue administrative decisions based on it. Youpin Group maintains that its non-compliance with the Investment Contract terms resulted from uncontrollable external factors, specifically the original landlord's failure to vacate the premises as scheduled coupled with the disruptive effects of the COVID-19 pandemic, both of which constitute force majeure circumstances. As of the reporting date, the court has not yet rendered a final judgment on this case. Accordingly, the Group considers the ultimate outcome of this litigation to be subject to significant uncertainty.

The defendants in this case are Quanzhou Youyi Dianhuan Network Technology Co., Ltd., Youpin Automobile Service (Shandong) Co., Ltd., and Shanghai Youxu New Energy Technology Co., Ltd. The plaintiff, Quanzhou Meibiao Youxin Automobile Sales Service Co., Ltd., filed the following claims: (1) payment of RMB 700,000 for battery costs plus interest on delayed payment (calculated at 1.5 times the LPR from the filing date until full payment); and (2) coverage of all litigation fees by the defendants. The Quanzhou Fengze District People's Court accepted the case, which was heard on March 22, 2024. On April 10, 2024, both parties conducted additional online cross-examination of supplementary evidence. On July 10, 2024, the court ruled in favor of the plaintiff, ordering Shandong Youpin to pay the battery costs and interest. On July 25, 2024, Shandong Youpin appealed to the Quanzhou Intermediate People's Court. On November 8, 2024, the intermediate court revoked the original judgment and remanded the case for retrial, pending court scheduling

 ****

***Guarantees***

From August 2020 to November 2021, Youguan Financial Leasing provided a total of RMB5,869 (US$827) guarantee to its four customers who entered into two five-year guarantees and two four-year guarantees. As of the date of this annual report, the balance of the guarantees were RMB2,003(US$274).

**23. SUBSEQUENT EVENTS**

The Group evaluated all events that occurred up to the date of this report and determined that no events that would have required adjustment or disclosure in the consolidated financial statements except the following:

Youpin SD sued one of its vehicle sourcing service providers Inner Mongolia Zhonglutong Trading Co., Ltd. for failing to deliver vehicles as scheduled to Youpin SD's customer. Youpin SD won the case on September 8, 2022. On March 23, 2023, both parties entered into a settlement agreement, and the supplier agreed to return the deposit and liquidated damages with a total of RMB2,746 (US$376). As of the date of this annual report, Youpin SD has applied for compulsory enforcement and the remaining unpaid amount was RMB2,609 (US$357).

Youpin sued Hainan Gaozhan New Energy Vehicle Company Limited for its failure to refund a deposit of RMB170 (US$243) to Youpin in November 2023. On April 10, 2024, Youpin won the trial. As of the date of this report, Youpin has applied for compulsory enforcement.

Youguan Financial Leasing (China) Co., Ltd. sued Sichuan Maichebang Automobile Sales Co., Ltd., Yuan Mingqin and Yuan Jinsong for rent and liquidated damages of a total of RMB1,949, on January 9, 2024. The case has been accepted by the court. On March 21, 2025, the Zhangdian District People's Court of Zibo City reopened proceedings for the case. Subsequently, on April 8, 2025, the court appointed an independent valuation firm to assess the disputed vehicles' market value under judicial supervision.

Quanzhou Youyi Power Exchange Network Technology Co., Ltd., Youpin SD and SH Youxu were sued by Quanzhou Meibiaoyouxin Automobile Sales Service Co., Ltd. for payment of RMB700 and liquidated damages, on January 16, 2024. The initial hearing was held on March 22, 2024. Youpin SD lost the case and appealed to the court on July 25, 2024. On November 8, 2024, the Quanzhou Intermediate People's Court has revoked the original judgment and remanded the case for retrial.

AHYS, Shanghai Youcang Business Consulting Partnership (Limited Partnership), and Li Jia were sued by Zhuji Huarui Wenhua Equity Investment Partnership (Limited Partnership), Zhuji Huarui Torch Venture Capital Investment Partnership (Limited Partnership) and Zhuji Fuhui Industrial Transformation and Upgrading Investment Fund Partnership (Limited Partnership). The plaintiffs requested the court to order the defendants to jointly pay the investment exit amount of RMB10,000, along with overdue payment penalties (calculated based on RMB10,000 at the prevailing one-year Loan Prime Rate (LPR) of banks, calculated from January 1, 2024, to the actual payment date; and the litigation costs. The case commenced on February 20, 2025.

Wuhu High-Tech Industrial Development Zone Administrative Committee has issued an Administrative Decision to Youpin on August 29, 2024, which requires Youpin to return a rental subsidy of RMB3,000. Youpin has applied for administrative reconsideration to the Wuhu Municipal People's Government. A hearing for the case was held on January 9, 2025, and the decision from the reconsideration authority is pending as of the date of this annual report.

Zibo Hengsong You Car Equity Investment Fund Partnership (Limited Partnership) has sued Youpin SD, AHYS, WFOE and Mr. Jia Li. The plaintiff requests the defendants to repurchase the 13.0435% equity interest in Youpin SD and jointly pay the equity repurchase price of RMB240,000 plus interest (temporarily calculated at RMB78,220). In response, the defendants believe that the plaintiff's claim is unfounded and that all their contractual obligations have been fulfilled. The defendants will file a counterclaim demanding that the plaintiff transfer the 13.0435% equity interest in Youpin SD to the defendants at a consideration of one yuan. The initial court hearing is scheduled for May 6, 2025.

On January 27, 2025, after giving further effect to the offering (which includes the issuance and sale of 648,000 Class A Ordinary Shares and Pre-funded Warrants to purchase up to an aggregate of 393,668 Class A Ordinary Shares), the Group have been received approximately US$4,662.

**23. UNAUDITED CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY**

The Company's PRC subsidiaries are restricted in their ability to transfer a portion of their net assets to the Company. The payment of dividends by entities organized in the PRC is subject to limitations, procedures and formalities. Regulations in the PRC currently permit payment of dividends only out of accumulated profits as determined in accordance with accounting standards and regulations in the PRC. The Company's subsidiaries are also required to set aside at least 10% of its after-tax profit based on PRC accounting standards each year to its statutory reserves account until the accumulative amount of such reserves reaches 50% of its respective registered capital. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends.

In addition, the Company's operations and revenue are conducted and generated in the PRC, and all of the Company's revenue earned and currency received are denominated in RMB. RMB is subject to the foreign exchange control regulation in China, and, as a result, the Company may be unable to distribute any dividends outside of China due to PRC foreign exchange control regulations that restrict the Company's ability to convert RMB into USD.

Regulation S-X requires the condensed financial information of registrant shall be filed when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. For purposes of the above test, restricted net assets of consolidated subsidiaries shall mean that the 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. 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 Company's PRC subsidiary exceed 25% of the consolidated net assets of the Company.

Certain information and footnote disclosures normally included in financial statements prepared in conformity with generally accepted accounting principles have been condensed or omitted. The Company's investment in its subsidiaries is stated at cost plus equity in undistributed earnings of subsidiaries.

The condensed financial information has been prepared using the same accounting policies as set out in the consolidated financial statements except that the equity method has been used to account for investments in its subsidiaries. For the parent company, the Group records its investments in subsidiaries similar to the equity method of accounting as prescribed in ASC 323, Investments—Equity Method and Joint Ventures. Such investments are presented on the Condensed Balance Sheets as "Investments in subsidiaries" and the subsidiaries' loss as "Equity in losses of subsidiaries" on the Condensed Statements of Comprehensive Loss. The condensed financial information presented in the parent company's financial statements equal the corresponding amounts attributable to the parent company in the consolidated financial statements.

**U POWER LIMITED<br> UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS<br> (Amounts in thousands of RMB and US$, except for number of shares)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | **As of** | **As of** | **As of** |
|  |<br>**Notes** | **December 31,**<br>**2024** | **June 30,**<br>**2025** | **June 30,**<br>**2025** |
|  | | **RMB** | **RMB** | **US$** |
| **ASSETS** |  |  |  |  |
| **Current assets:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents |  | 23435 | 22697 | 3168 |
| &nbsp;&nbsp;&nbsp;Restricted cash |  | 1239 | 300 | 42 |
| &nbsp;&nbsp;&nbsp;Accounts receivable | 5 | 10374 | 18356 | 2562 |
| &nbsp;&nbsp;&nbsp;Inventories | 6 | 9872 | 12980 | 1812 |
| &nbsp;&nbsp;&nbsp;Advance to suppliers | 7 | 9466 | 9808 | 1369 |
| &nbsp;&nbsp;&nbsp;Other current assets | 8 | 29032 | 31212 | 4357 |
| &nbsp;&nbsp;&nbsp;Amount due from related parties | 16 | 21657 | 45065 | 6291 |
| **Total current assets** |  | **105075** | **140418** | **19601** |
| **Non-current assets:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Property, plant and equipment, net | 9 | 8656 | 8647 | 1207 |
| &nbsp;&nbsp;&nbsp;Intangible assets, net | 10 | 132 | 97 | 14 |
| &nbsp;&nbsp;&nbsp;Operating lease right-of-use assets, net | 15 | 16205 | 12003 | 1676 |
| &nbsp;&nbsp;&nbsp;Long-term investments | 11 | 134114 | 134026 | 18709 |
| &nbsp;&nbsp;&nbsp;Refundable deposit for investment | 12 | 39799 | 20621 | 2879 |
| &nbsp;&nbsp;&nbsp;Other non-current assets | 8 | 81733 | 80213 | 11196 |
| **Total non-current assets** |  | **280639** | **255607** | **35681** |
| **Total assets** |  | **385714** | **396025** | **55282** |
| **LIABILITIES AND EQUITY** |  |  |  |  |
| **Current liabilities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Short-term bank borrowing | 13 | 17972 | 17172 | 2397 |
| &nbsp;&nbsp;&nbsp;Current portion of long-term borrowing | 13 |  | 5800 | 810 |
| &nbsp;&nbsp;&nbsp;Accounts payable |  | 14307 | 17229 | 2405 |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other liabilities | 14 | 13281 | 12222 | 1706 |
| &nbsp;&nbsp;&nbsp;Income tax payables | 18 | 5169 | 5496 | 767 |
| &nbsp;&nbsp;&nbsp;Advances from customers |  | 1086 | 1699 | 237 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities – current | 15 | 1843 | 981 | 137 |
| &nbsp;&nbsp;&nbsp;Amount due to related parties | 16 | 3239 | 2520 | 352 |
| **Total current liabilities** |  | **56897** | **63119** | **8811** |
| **Non-current liabilities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities – non-current | 15 | 4137 | 2933 | 409 |
| &nbsp;&nbsp;&nbsp;Bank borrowings | 13 | 3700 |  |  |
| &nbsp;&nbsp;&nbsp;Commitments and contingent liabilities | 21 |  | 3000 | 419 |
| **Total non-current liabilities** |  | **7837** | **5933** | **828** |
| **Total liabilities** |  | **64734** | **69052** | **9639** |
| **Shareholders' equity:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Class A Ordinary Shares, $0.00001 par value, 3,999,411,812 Class A Ordinary Shares authorized 2,700,00 and 3,831,668 Class A Ordinary Shares issued and outstanding as of December 31, 2024 and June 30, 2025 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Class B Ordinary Shares, $0.00001 par value, 1,000,588,188 Class B Ordinary Shares authorized 588,188 and 588,188 Class B Ordinary Shares issued and outstanding as of as of December 31, 2024 and June 30, 2025 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Additional paid-in capital |  | 512568 | 545963 | 76213 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit |  | (221098) | (243098) | (33935) |
| **Total U POWER LIMITED's shareholders' equity** |  | **291470** | **302865** | **42278** |
| Non-controlling interests |  | 29510 | 24108 | 3365 |
| **Total equity** |  | **320980** | **326973** | **45643** |
| **Total liabilities and equity** |  | **385714** | **396025** | **55282** |

---

The accompanying notes are an integral part of these consolidated financial statements.

**U POWER LIMITED<br> UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS<br> (Amounts in thousands of RMB and US$, except for number of shares and per share data)**

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| | | | | |
|:---|:---|:---|:---|:---|
|  | | **For the six months ended June 30,** | **For the six months ended June 30,** | **For the six months ended June 30,** |
|  |<br>**Notes** | **2024** | **2025** | **2025** |
|  | | **RMB** | **RMB** | **US$** |
| **Net revenue** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Product sales |  | 12389 | 13899 | 1940 |
| &nbsp;&nbsp;&nbsp;Sourcing services |  | 75 | 2812 | 393 |
| &nbsp;&nbsp;&nbsp;Battery-swapping services |  | 726 | 1018 | 142 |
| **Total net revenue** |  | **13190** | **17729** | **2475** |
| &nbsp;&nbsp;&nbsp;Cost of revenue |  | (11902) | (9338) | (1304) |
| **Gross profit** |  | **1288** | **8391** | **1171** |
| **Operating expenses:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Sales and marketing expenses |  | (1483) | (1767) | (247) |
| &nbsp;&nbsp;&nbsp;General and administrative expenses |  | (26157) | (24571) | (3430) |
| &nbsp;&nbsp;&nbsp;Research and development expenses |  | (575) | (3416) | (477) |
| &nbsp;&nbsp;&nbsp;Allowance for expected credit losses |  | 531 | 3903 | 545 |
| &nbsp;&nbsp;&nbsp;**Total operating expenses** |  | **(27684)** | **(25851)** | **(3609)** |
| **Operating loss** |  | **(26396)** | **(17460)** | **(2438)** |
| &nbsp;&nbsp;&nbsp;Interest income |  | 7 | 16 | 2 |
| &nbsp;&nbsp;&nbsp;Interest expenses |  | (877) | (248) | (35) |
| &nbsp;&nbsp;&nbsp;Other income |  | 1435 | 3917 | 547 |
| &nbsp;&nbsp;&nbsp;Other expenses |  | (685) | (13301) | (1857) |
| **Loss before income taxes** |  | **(26516)** | **(27076)** | **(3781)** |
| &nbsp;&nbsp;&nbsp;Income tax expense | 18 | - | (326) | (46) |
| **Net loss** |  | **(26516)** | **(27402)** | **(3827)** |
| &nbsp;&nbsp;&nbsp;Less: Net loss attributable to non-controlling interests |  | (2991) | (5402) | (754) |
| **Net loss attributable to the Company's shareholders and total<br> comprehensive loss** |  | **(23525)** | **(22000)** | **(3073)** |
| **Loss per share attributable to ordinary shareholders of the Company's shareholders \*** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted | 20 | (7.42) | (5.79) | (0.81) |
| **Weighted average shares used in calculating basic and diluted loss per share \*** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic and diluted |  | 3168544 | 3802047 | 3802047 |
| **Net loss** |  | **(26516)** | **(27402)** | **(3827)** |
| **Other comprehensive income, net of tax of nil:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Foreign currency translation adjustments |  | (446) |  |  |
| **Comprehensive loss** |  | **(26962)** | **(27402)** | **(3827)** |

---

The accompanying notes are an integral part of these consolidated financial statements.

**U POWER LIMITED<br> UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY<br> (Amounts in thousands of RMB and US$, except for number of shares)**

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Class A** | **Class A** | **Class B** | **Class B** | | | | | | |
|  | **Ordinary shares** | **Ordinary shares** | **Ordinary shares** | **Ordinary shares** | | | | | | |
|  | **Shares \*** | **Amount** | **shares\*** | **Amount** |<br>**Additional**<br>**paid-in**<br>**capital** |<br>**Accumulated**<br>**deficit** |<br>**Translation**<br>**reserve** | **Total**<br>**U POWER LIMITED**<br>**shareholders'**<br>**equity** |<br>**Non-**<br>**controlling**<br>**interests** |<br>**Total**<br> **equity** |
|  | | **RMB** | | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** | **RMB** |
| **Balance as of December 31, 2023** | **1243140** |  | **-** |  | **479400** | **(173176)** | **446** | **306670** | **37950** | **344620** |
| Consolidated net loss |  |  |  |  |  | (47922) |  | (47922) | (8440) | (56362) |
| Issuance of ordinary shares | 1546860 |  | 588188 |  | 49276 |  |  | 49276 |  | 49276 |
| Investment Refund |  |  |  |  | (16108) |  |  | (16108) |  | (16108) |
| Other comprehensive income |  |  |  |  |  |  | (446) | (446) |  | (446) |
| **Balance as of December 31, 2024 in RMB** | **2790000** |  | **588188** |  | **512568** | **(221098)** | **-** | **291470** | **29510** | **320980** |
| Consolidated net loss |  |  |  |  |  | (22000) |  | (22000) | (5402) | (27402) |
| Issuance of ordinary shares | 1041668 |  |  |  | 33395 |  |  | 33395 |  | 33395 |
| **Balance as of June 30, 2025 in RMB** | **3831668** |  | **588188** |  | **545963** | **(243098)** |  | **302865** | **24108** | **326973** |
| **Balance as of June 30, 2025 in US$** | **3831668** |  | **588188** |  | **76213** | **(33935)** |  | **42278** | **3365** | **45643** |

---

The accompanying notes are an integral part of these consolidated financial statements.

**U POWER LIMITED<br> UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS<br> (Amounts in thousands of RMB and US$, except for number of shares)**

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| | | | |
|:---|:---|:---|:---|
|  | **For the six months ended June 30,** | **For the six months ended June 30,** | **For the six months ended June 30,** |
|  | **2024** | **2025** | **2025** |
|  | **RMB** | **RMB** | **US$** |
| **CASH FLOWS FROM OPERATING ACTIVITIES** |  |  |  |
| **Net loss** | (26516) | (27402) | (3827) |
| *Adjustments to reconcile net loss to net cash used in operating activities:* |  |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 2640 | 1618 | 226 |
| &nbsp;&nbsp;&nbsp;Amortization of right-of-use assets | 2800 | 4203 | 587 |
| &nbsp;&nbsp;&nbsp;Allowance for expected credit losses | (531) | (3903) | (545) |
| &nbsp;&nbsp;&nbsp;Loss from investments | 264 |  |  |
| &nbsp;&nbsp;&nbsp;Loss on impairment of inventory |  | (12) | (2) |
| *Changes in operating assets and liabilities:* |  |  |  |
| &nbsp;&nbsp;&nbsp;Accounts receivables | (2805) | (7988) | (1115) |
| &nbsp;&nbsp;&nbsp;Inventories | (643) | (3097) | (432) |
| &nbsp;&nbsp;&nbsp;Advance to suppliers | (38) | 3538 | 494 |
| &nbsp;&nbsp;&nbsp;Other current assets | 3145 | (4617) | (645) |
| &nbsp;&nbsp;&nbsp;Amount due from related parties | (264) | (3408) | (476) |
| &nbsp;&nbsp;&nbsp;Other non-current assets | (4342) |  |  |
| &nbsp;&nbsp;&nbsp;Accounts payables | 7903 | 2922 | 408 |
| &nbsp;&nbsp;&nbsp;Accrued expenses and other payables | (6144) | 1056 | 148 |
| &nbsp;&nbsp;&nbsp;Income tax payables |  | 326 | 46 |
| &nbsp;&nbsp;&nbsp;Advance from customers | (1238) | 613 | 86 |
| &nbsp;&nbsp;&nbsp;Amount due to related parties | (5140) | (719) | (100) |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | (865) | (2064) | (288) |
| &nbsp;&nbsp;&nbsp;Commitments and contingent liabilities | - | 3000 | 419 |
| **Net cash used in operating activities** | **(31774)** | **(35934)** | **(5016)** |
| **CASH FLOWS FROM INVESTING ACTIVITIES** |  |  |  |
| &nbsp;&nbsp;&nbsp;Purchases of property and equipment | (349) | (94) | (13) |
| &nbsp;&nbsp;&nbsp;Loans repayments from third parties | 13822 | 20163 | 2815 |
| &nbsp;&nbsp;&nbsp;Loan payment to related parties |  | (20001) | (2792) |
| &nbsp;&nbsp;&nbsp;Return of long-term investments | - | - | - |
| **Net cash provided by investing activities** | **13473** | **68** | **10** |
| **CASH FLOWS FROM FINANCING ACTIVITIES** |  |  |  |
| &nbsp;&nbsp;&nbsp;Capital contribution by controlling shareholders | 23077 |  |  |
| &nbsp;&nbsp;&nbsp;Capital contribution from issuance of ordinary shares |  | 33395 | 4662 |
| &nbsp;&nbsp;&nbsp;Proceeds from short-term bank borrowing |  | 2000 | 279 |
| &nbsp;&nbsp;&nbsp;Repayments of long-term bank borrowing |  | (700) | (98) |
| &nbsp;&nbsp;&nbsp;Repayments of loan payable | (500) | (2114) | (295) |
| **Net cash provided by financing activities** | **22577** | **32581** | **4548** |
| Net (decrease)/ increase in cash and cash equivalents and restricted cash | 4276 | (3285) | (458) |
| Effects of exchange rate changes |  | 1608 | 224 |
| Cash and cash equivalents and restricted cash at beginning of year | 36239 | 24674 | 3444 |
| **Cash and cash equivalents and restricted cash at end of period** | **40515** | **22997** | **3210** |
| **Supplemental disclosures of non-cash activities:** |  |  |  |
| Right-of-use assets obtained in exchange for new operating lease liabilities |  |  |  |
| Cancellation of capital contribution | 16037 |  |  |

---

The accompanying notes are an integral part of these consolidated financial statements.

**U POWER LIMITED<br> NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS<br> (Amounts in thousands of RMB and US$, except for number of shares and per share data)**

**1. ORGANIZATION**

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***(a) Nature of operations***

U POWER LIMITED (the "Company") was incorporated in the Cayman Islands on June 17, 2021, under the Cayman Islands Companies Law as an exempted company with limited liability. Anhui Yousheng New Energy Technology Group Co., Ltd. ("AHYS", formerly known as "Shanghai Yousheng New Energy Technology Group Co. Ltd.") was incorporated in the People's Republic of China (the "PRC" or "China") on May 16, 2013. AHYS, together with its subsidiaries (collectively, the "Operating Entities") are principally engaged in the provision of: 1) new energy vehicles development and sales; 2) battery-swapping stations manufacturing and sales; 3) battery-swapping services; and 4) sourcing services (collectively, the "Principal Business").

 ****

***(b) Reorganization***

In preparation of its initial public offering ("IPO") in the United States, the following transactions were undertaken to reorganize the legal structure of the Operating Entities. The Company was incorporated in connection with a group reorganization (the "Reorganization") of the Operating Entities. On June 30, 2021, and January 5, 2022, the Company incorporated two wholly-owned subsidiaries, Youcang Limited ("Youcang") and U Robur Limited ("U Robur BVI") in British Virgin Islands, respectively. On July 19, 2021, Youcang incorporated a wholly-owned subsidiary, Energy U Limited ("Energy U") in Hong Kong. On January 24, 2022, U Robur BVI incorporated a wholly-owned subsidiary, U Robur Limited ("U Robur HK"). On January 27, 2021, Energy U incorporated a wholly-owned subsidiary, Shandong Yousheng New Energy Technology Development Co, Ltd. ("WFOE") in the PRC.

On July 8, 2022, the Company, through WFOE, entered into an equity purchase agreement with AHYS and its then shareholders, through which the Company has become the ultimate primary beneficiary of AHYS. As all the entities involved in the process of the Reorganization are under common ownership of AHYS's shareholders before and after the Reorganization, the Reorganization is accounted for in a manner similar to a pooling of interests with the assets and liabilities of the parties to the Reorganization carried over at their historical amounts. Therefore, the accompanying consolidated financial statements were prepared as if the corporate structure of the Company had been in existence since the beginning of the periods presented. The Company and its subsidiaries hereinafter are collectively referred to as the "Group".

As of the date of this report, the details of the Company's principal subsidiaries are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Entity** | **Date of<br> incorporation/<br> acquisition** | **Place of<br> incorporation** | **Percentage<br> of direct<br> or indirect<br> ownership<br> by the<br> Company** | **Principal activities** |
| **Subsidiaries:** |  |  | |  |
| Youcang Limited ("Youcang") | June 30, 2021 | British Virgin Islands | 100% | Investment holding |
| Energy U Limited ("Energy U") | July 19, 2021 | Hong Kong | 100% | Investment holding |
| Shandong Yousheng New Energy Technology Development Co, Ltd. ("WFOE")<sup>(1)</sup> | January 27, 2022 | PRC | 100% | Provision of technical and consultation services |
| Anhui Yousheng New Energy Co., Ltd ("AHYS")<sup>(1)</sup> | May 16, 2013 | PRC | 100% | Dormant Company |
| Youpin Automobile Service Group Co. Ltd. ("Youpin")<sup>(1)</sup> | July 18, 2013 | PRC | 54.37% | Provision of new energy vehicles sales, battery-swapping stations sales, battery-swapping services and sourcing services |
| Shanghai Youchuangneng Digital Technology Co., Ltd. ("SY Digital Tech) <sup>(1)</sup> | November 13, 2015 | PRC | 100% | Provision of new energy vehicles sales, battery-swapping stations sales, battery-swapping services and sourcing services |
| Youguan Financial Leasing Co., Ltd. ("Youguan Financial Leasing")<sup>(1)</sup> | February 27, 2017 | PRC | 100% | Dormant Company |
| Youpin Automobile Service (Shandong) Co., Ltd. ("Youpin SD")<sup>(1)</sup> | June 30, 2020 | PRC | 86.96% | Provision of new energy vehicles sales and sourcing services |
| Chengdu Youyineng Automobile Service Co., Ltd. ("CD Youyineng")<sup>(1)</sup> | October 29, 2020 | PRC | 100% | Provision of battery-swapping stations manufacturing |
| Shanghai Youteng Automobile Service Co., Ltd. ("SH Youteng")<sup>(1)</sup> | November 3, 2020 | PRC | 70% | Dormant Company |
| Liaoning Youguan New Energy Technology Co. Ltd. ("LY New Energy")<sup>(1)</sup> | November 8, 2019 | PRC | 100% | Provision of new energy vehicles sales and sourcing services |
| Shanghai Youxu New Energy Technology Co., Ltd. ("SH Youxu")<sup>(1)</sup> | March 22, 2021 | PRC | 70% | Provision of battery-swapping stations sales and battery-swapping services and two-wheeled vehicle battery-swapping services |
| Quanzhou Youyi Power Exchange Network Technology Co., Ltd. ("QZ Youyi")<sup>(1)</sup> | June 29, 2021 | PRC | 100% | Provision of battery-swapping services |
| Youxu New Energy Technology (Zibo) Co., Ltd. ("Youxu Zibo")<sup>(1)</sup> | July 29, 2021 | PRC | 100% | Provision of batter swapping stations manufacturing |
| Youxu (Xiamen) Power Exchange Network Technology Co., Ltd. ("Youxu XM")<sup>(1)</sup> | August 10, 2021 | PRC | 100% | Provision of battery-swapping services |
| Wuhu Youxu New Energy Technology Co., Ltd. ("WH Youxu") <sup>(1)</sup> | November 12, 2021 | PRC | 100% | Provision of batter swapping stations manufacturing |
| Henan Youxu New Energy Technology Co., Ltd. ("HN Youxu") <sup>(1)</sup> | December 1, 2022 | PRC | 80% | Dormant Company |
| Youxu New Energy Technology (Nanyang) Co., Ltd. ("NY Youxu") <sup>(1)</sup> | March 14, 2023 | PRC | 70% | Provision of batter swapping stations manufacturing |
| U SWAP CO LTD ("U SWAP") | June 13, 2024 | Thailand | 85% | Provision of new energy vehicles sales, battery-swapping stations sales, battery-swapping services and sourcing services |
| Greendrive Tech Co. Ltd ("Greendrive") | March 20, 2025 | Thailand | 70% | Provision of new energy vehicles sales, battery-swapping stations sales, battery-swapping services and sourcing services |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Collectively, the "PRC subsidiaries".

***(c) Initial Public Offering***

In April 2023, the Company, in connection with its IPO in the United States, issued 2,416,667 ordinary shares (2,416,667 ordinary shares before the share consolidation implemented on March 25, 2024 (the "Share Consolidation") from the IPO of approximately US$13,002.

***(d) Additional shares issued***

As of December 2023, the Company, in connection with its follow-on offering, issued 718,973 ordinary shares (71,897,268 ordinary shares before the Share Consolidation with net proceeds of approximately US$9,000.

***(e) Consolidation of Ordinary Shares***

On March 25, 2024, the Company implemented the Share Consolidation, pursuant to which, every 100 ordinary shares with a par value of US$0.0000001 each in the Company's issued and unissued share capital were consolidated into one ordinary share with a par value of US$0.00001 each. As a result of the share consolidation, there was approximately 3,378,188 ordinary shares as of December 31, 2024.

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

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***(a) Basis of presentation***

The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ("U.S. GAAP").

 ****

***(b) Principles of consolidation***

The accompanying consolidated financial statements of the Group include the financial statements of the Company and its subsidiaries for which the Company is the ultimate primary beneficiary.

A subsidiary is an entity in which the Company, directly or indirectly, controls more than one half of the voting power; has the power to appoint or remove the majority of the members of the board of directors (the "Board"); and to cast a majority of the votes at the meeting of the Board or to govern the financial and operating policies of the investee under a statute or agreement among the shareholders or equity holders.

All significant transactions and balances between the Company and its subsidiaries have been eliminated in consolidation. The non-controlling interests in consolidated subsidiaries are shown separately in the consolidated financial statements.

 ****

***(c) Use of estimates***

The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant accounting estimates reflected in the Group's consolidated financial statements mainly include the incremental borrowing rate used in the recognition of right-of-use assets and lease liabilities, allowance for expected credit loss, the useful lives of property, plant and equipment and intangible assets, contingent liabilities and valuation allowance for deferred tax assets. The Group bases its estimates on historical experience and on various other assumptions that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Any future changes to these estimates and assumptions could cause a material change to the Group's reported amounts of revenue, expenses, assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions.

***(d) Functional currency and foreign currency translation***

The Group uses Renminbi ("RMB") as its reporting currency. The functional currency of the Company and its overseas subsidiaries that are incorporated in the Cayman Islands and British Virgin Islands is the U.S. Dollar ("US$"). The functional currency of the Company's subsidiaries that are incorporated in Hong Kong is Hong Kong Dollar ("HK$"). The functional currency of the Company's subsidiaries that are incorporated in the PRC is RMB.

In the consolidated financial statements, the financial information of the Company and other entities located outside of PRC has been translated into RMB. Assets and liabilities are translated at the exchange rates on the balance sheet date, equity amounts are translated at historical exchange rates, and revenue, expenses, gains and losses are translated using the average rate for the periods. Translation adjustments are reported as foreign currency translation adjustments and are shown as a component of other comprehensive loss in the consolidated statements of operations and comprehensive income (loss). There was nil foreign currency translation gain or loss recognized for the six months ended June 30, 2024 and 2025.

Transactions denominated in foreign currencies are re-measured into the functional currency at the exchange rates prevailing on the transaction dates. Financial assets and liabilities denominated in foreign currencies are re-measured into the functional currency at the exchange rates prevailing at the balance sheet date.

***(e) Convenience translation***

The Group's business is primarily conducted in China and all of the revenue is denominated in RMB. However, periodic reports made to shareholders will include current period amounts translated into U.S. dollars using the exchange rate as of balance sheet date, for the convenience of the readers. Translations of balances in the consolidated balance sheets, consolidated statements of comprehensive loss, change in equity and related consolidated statements of cash flows from RMB into US$ as of and for the six months ended June 30, 2025 are solely for the convenience of the reader and were calculated at the rate of US$1.00 to RMB7.1636, representing the noon buying rate in The City of New York for cable transfers of RMB as certified for customs purposes by the Federal Reserve Bank of New York on June 30, 2025. No representation is made that the RMB amounts represent or could have been, or could be, converted, realized or settled into US$ at that rate on June 30, 2025 or at any other rate.

 ****

***(f) Non-controlling interest***

For certain subsidiaries, a non-controlling interest is recognized to reflect the portion of their equity which is not attributable, directly or indirectly, to the Group. Consolidated net loss or income on the consolidated statements of operations includes the net loss or income attributable to non-controlling interests. Non-controlling interests are classified as a separate line item in the equity section of the Group's consolidated balance sheets and have been separately disclosed in the Group's consolidated statements of operations to distinguish the interests from that of the Company.

 ****

***(g) Cash and cash equivalents***

Cash and cash equivalents represent cash on hand, time deposits and highly-liquid investments placed with banks or other financial institutions, which are unrestricted as to withdrawal and use, and which have original maturities of three months or less.

 ****

***(h) Restricted cash***

Restricted cash represents the cash that is not freely available to be spent nor re-invested to sustain future growth, which is legally or contractually restricted, or only to be used for a specified purpose. The restrictions can be permanent or temporary. Failure to use the asset according to agreed limitations will generate contractual or legal consequences.

 ****

***(i) Allowance for expected credit loss***

Accounts receivable, advance to suppliers and other current assets are recognized at original invoiced amount. The Group measures all expected credit losses at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. The Group reviews the accounts receivable, advance to suppliers and other current assets periodically, and recognizes the expected credit losses based on many factors, including the customer's payment history, its current credit-worthiness and current economic trends.

Based on the result of the Group's estimation of collectability, the Group recognized a reversal of RMB531 of expected credit losses for the six months ended June 30, 2024 and recognized a reversal of RMB3,903(US$545) of expected credit losses for the six months ended June 30, 2025.

***(j) Inventories***

Inventories, consisting of raw materials and products available for sale, are stated at the lower of cost or net realizable value. Cost of inventory are determined using the first-in-first-out method. The Group records inventory reserves for obsolete and slow-moving inventory. Inventory reserves are based on inventory obsolescence trends, historical experience and application of the specific identification method. There was no inventory impairment recognized for the six months ended June 30, 2024 and 2025, respectively.

 ****

 ****

***(k) Property, plant and equipment, net***

Property, plant and equipment are stated at cost less accumulated depreciation and impairment loss, if any. Property and equipment are depreciated at rates sufficient to write off their costs less impairment and residual value, if any, over their estimated useful lives on a straight-line basis. Leasehold improvements are amortized over the shorter of the lease term or the estimated useful lives of the related assets. Within the property, plant and equipment, the value for construction in process is included within the manufacturing equipment.

---

| | |
|:---|:---|
| **Category** | **Estimated useful life** |
| Leasehold improvements | 1 - 3 years |
| Manufacturing equipment | 3 – 10 years |
| Computer and electronic equipment | 3 – 5 years |
| Office equipment | 2 – 4 years |
| Motor vehicles | 3 – 4 years |

---

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***(l) Intangible assets, net***

Intangible assets are carried at cost less accumulated amortization and impairment, if any. Intangible assets are amortized using the straight-line method over the estimated useful lives from 3 to 5 years. The estimated useful lives of amortized intangible assets are reassessed if circumstances occur that indicate the original estimated useful lives have changed.

 ****

***(m) Impairment of long-lived assets***

The Group evaluates its long-lived assets, including property, plant and equipment, software and right-of-use assets with finite lives 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 of an asset may not be fully recoverable. When these events occur, the Group evaluates the recoverability of long-lived assets by comparing the carrying amounts of the assets to the future undiscounted cash flows expected to result from the use of the assets and their eventual disposition. If the sum of the expected undiscounted cash flows is less than the carrying amounts of the assets, the Group recognizes an impairment loss based on the excess of the carrying amounts of the assets over their fair value. Fair value is generally determined by discounting the cash flows expected to be generated by the assets, when the market prices are not readily available. There was no impairment of long-lived assets recognized for the six months ended June 30, 2024 and 2025, respectively.

 ****

***(n) Long-term investments***

The Group's long-term investments mainly include equity investments in entities. Investments in entities in which the Group can exercise significant influence and holds an investment in voting common stock or in-substance common stock (or both) of the investee but does not own a majority equity interest or control are accounted for using the equity method of accounting in accordance with ASC topic 323, Investments - Equity Method and Joint Ventures ("ASC 323"). Under the equity method, the Group initially records its investments at fair value. The Group subsequently adjusts the carrying amount of the investments to recognize the Group's proportionate share of each equity investee's net income or loss into earnings after the date of investment. The Group evaluates the equity method investments for impairment under ASC 323. An impairment loss on the equity method investments is recognized in earnings when the decline in value is determined to be other-than-temporary. There was no impairment of long-term investments recognized for the six months ended June 30, 2024 and 2025, respectively.

 ****

***(o) Fair value of financial instruments***

Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required or permitted to be either recorded or disclosed at fair value, the Group considers the principal or most advantageous market in which it would transact, and it also considers assumptions that market participants would use when pricing the asset or liability.

Accounting guidance establishes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument's categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Accounting guidance establishes three levels of inputs that may be used to measure fair value:

Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 - Other inputs that are directly or indirectly observable in the marketplace.

Level 3 - Unobservable inputs which are supported by little or no market activity.

Financial assets and liabilities of the Group primarily consist of cash and cash equivalents, accounts receivable, amounts due from related parties, deposits and other receivables, accounts payable, amounts due to related parties, other payables, short-term bank and other borrowings and loan payables. As of June 30, 2025, the carrying values of these financial instruments are approximated to their fair values.

 ****

***(p) Revenue recognition***

Under ASC 606, Revenue from Contracts with Customers, the Group recognizes revenue when a customer obtains control of promised goods or services and recognizes in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services.

The Group recognized revenue according to the following five-step revenue recognition criteria based on ASC 606: (1) identify the contract with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price; and (5) recognize revenue when or as the entity satisfies a performance obligation.

The Group recognized revenue when or as the control of the goods or services is transferred to a customer. Depending on the terms of the contract and the laws that apply to the contract, control of the goods and services may be transferred over time or at a point in time. Control of the goods and services is transferred over time if the Group's performance:

&nbsp;&nbsp;&nbsp;&nbsp;(i) provides
all of the benefits received and consumed simultaneously by the customer;

&nbsp;&nbsp;&nbsp;&nbsp;(ii) creates
and enhances an asset that the customer controls as the Group performs; or

&nbsp;&nbsp;&nbsp;&nbsp;(iii) does
not create an asset with an alternative use to the Group and the Group has an enforceable right to payment for performance completed
to date. If control of the goods and services transfers over time, revenue is recognized over the period of the contract by reference
to the progress towards complete satisfaction of that performance obligation. Otherwise, revenue is recognized at a point in time when
the customer obtains control of the goods and services.

If control of the goods and services transfers over time, revenue is recognized over the period of the contract by reference to the progress towards complete satisfaction of that performance obligation. Otherwise, revenue is recognized at a point in time when the customer obtains control of the goods and services.

Contracts with customers may include multiple performance obligations. For such arrangements, the Group allocates revenue to each performance obligation based on its relative standalone selling price. The Group generally determines standalone selling prices based on the prices charged to customers. If the standalone selling price is not directly observable, it is estimated using expected cost plus a margin or adjusted market assessment approach, depending on the availability of observable information. Assumptions and estimations have been made in estimating the relative selling price of each distinct performance obligation, and changes in judgments on these assumptions and estimates may impact the revenue recognition.

When either party to a contract has performed, the Group presents the contract in the consolidated balance sheets as a contract asset or a contract liability, depending on the relationship between the entity's performance and the customer's payment.

A contract asset is the Group's right to consideration in exchange for goods and services that the Group has transferred to a customer. A receivable is recorded when the Group has an unconditional right to consideration. A right to consideration is unconditional if only the passage of time is required before payment of that consideration is due.

If a customer pays consideration or the Group has a right to an amount of consideration that is unconditional, before the Group transfers a good or service to the customer, the Group presents the contract liability when the payment is made, or a receivable is recorded (whichever is earlier). A contract liability is the Group's obligation to transfer goods or services to a customer for which the Group has received consideration (or an amount of consideration is due) from the customer.

 

The following table sets forth a breakdown of our revenue, in absolute amounts and percentages of total revenue for the six months ended June 30, 2024 and 2025,

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2024** | **2025** | **2025** | **2025** |
|  | **RMB** | **%** | **RMB** | **US$** | **%** |
|  | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** | **(in thousands, except for percentages)** |
|  | **（** **Unaudited）** | **（** **Unaudited）** | **（** **Unaudited）** | **（** **Unaudited）** | **（** **Unaudited）** |
| Sourcing services | 75 | 0.6 | 2812 | 393 | 15.9 |
| Product sales | 12389 | 93.9 | 13899 | 1940 | 78.4 |
| Battery-swapping services | 726 | 5.5 | 1018 | 142 | 5.7 |
| **Total revenue** | **13190** | **100.0** | **17729** | **2475** | **100.0** |

---

*Sourcing services*

The Group generates revenue from the vehicle sourcing business and battery sourcing business.

Regarding to battery sourcing business, the Group acts as a principal as of being able to fully control relevant risks and benefits during the whole business, indicated by that can decide the selling price, has a right to recall the product and cease the transaction, and bear relevant risk of damage and loss prior to the delivery of battery to the customer. The sales of battery sourcing revenue are recognized on a gross basis at a point in time when the control of the battery pack is transferred to the customer.

For vehicle sourcing business, the Group charges service fees from its customers for their purchase of vehicles, where the Group is generally acting as an agent and its performance obligation is to purchase the specified vehicles for its customers. The Group charges the customers a commission that is calculated based on the purchase price of each purchase order. Vehicle sourcing service revenue are recognized on a net basis at the point in time when the service of purchase of the specified vehicles for the Group's customers is completed, i.e., the specified vehicle for the Group's customers is delivered. Payments are typically received in advance and are accounted for as contract liabilities until delivery, at which point the receipt in advance from customers is offset with the prepayment to the supplier and the difference representing the commission is recognized as revenue.

 

*Product sales*

The Group generates revenue from sales of battery-swapping stations. The Group identifies the users who purchase battery-swapping stations as its customers. The revenue for battery-swapping station sales is recognized at a point in time when the control of the product is transferred to the customer.

 

*Battery-swapping services*

The Group also generates revenue from providing battery-swapping services to vehicle drivers and the station control system upgrading services to the battery-swapping station owners. The Group identifies vehicle drivers who require battery-swapping services, as well as owners of battery-swapping stations to whom the Group has sold stations and who require station control system upgrade services, as its customers.

The Group charges the battery-swapping service fees from its customers based on vehicle miles traveled. However, as usually, the swapped battery will be immediately used after the payment by customers for driving and the power consumption of vehicles will be fast, the Group ignores the time interval between the timing of payment in advance by customers and the usage life of the swapped battery. The revenue generated from battery-swapping services to vehicle drivers is recognized at a point in time when the Group received the payment from vehicle drivers.

The revenue generated from the station control system upgrading service is recognized over time based on a straight-line method.

*Two-wheeled vehicle battery-swapping services*

 

By providing battery swap cabinets, two-wheeled vehicle drivers can perform self-service battery swaps. We charge the drivers a certain amount as revenue from the rent of battery.

The Group charges the battery-swapping services fee for battery providing to its customers based on the service time. The Two-wheeled vehicle Battery-swapping Services recognized revenue by over time.

***(q) Cost of revenue***

Cost of sales of battery-swapping stations primarily includes semi-finished goods purchased from suppliers, labor costs and manufacturing including depreciation of assets associated with production.

 ****

***(r) Sales and marketing expenses***

Sales and marketing expenses consist primarily of (i) compensation to selling personnel, including the salaries, performance-based bonus, and other benefits; (ii) travel cost related to the sales and marketing function; (iii) advertising, marketing and brand promotion expenses; and (iv) other expenses in relation to the selling and marketing activities. Advertising expenses consist primarily of costs for the promotion of corporate image and product marketing.

 ****

***(s) Research and development expenses***

Research and development expenses consist primarily of personnel-related costs directly associated with research and development organization. The Group's research and development expenses are related to enhancing and developing UOTTA technology for its existing products and new product development. The Group expenses research and development costs as incurred.

***(t) General and administrative expenses***

General and administrative expenses consist primarily of salaries, bonuses and benefits for employees involved in general corporate functions, and those not specifically dedicated to research and development activities, such as 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.

 ****

***(u) Employee benefits***

Full time employees of the Group in the PRC participate in a government mandated defined contribution plan, pursuant to which certain pension benefits, medical care, employee housing fund and other welfare benefits are provided to the employees. Chinese labor regulations require that the PRC subsidiaries of the Group make contributions to the government for these benefits based on certain percentages of the employees' salaries, up to a maximum amount specified by the local government. The Group has no legal obligation for the benefits beyond the contributions made.

 ****

***(v) Government grants***

The Group's PRC-based subsidiaries received government subsidies from certain local governments. The Group's government subsidies consisted of specific subsidies and other subsidies. Specific subsidies are subsidies that the local government has provided for a specific purpose, such as product development and renewal of production facilities. Other subsidies are the subsidies that the local government has not specified its purpose for and are not tied to future trends or performance of the Group. Receipt of such subsidy income is not contingent upon any further actions or performance of the Group and the amounts do not have to be refunded under any circumstances. The Group recorded specific purpose subsidies as advances payable when received. For specific subsidies, upon government acceptance of the related project development or asset acquisition, the specific purpose subsidies are recognized to reduce related R&D expenses or the cost of asset acquisition. Other subsidies are recognized as other operating income upon receipt as further performance by the Group is not required.

***(w) Taxation***

<u>Income Taxes</u>

Current income taxes are provided on the basis of income/(loss) for financial reporting purposes, adjusted for income and expense items which are not assessable or deductible for income tax purposes, in accordance with the regulations of the relevant tax jurisdictions. Deferred income taxes are provided using the assets and liabilities method. Under this method, deferred income taxes are recognized for the tax consequences of temporary differences by applying enacted statutory rates applicable to future years to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The tax base of an asset or liability is the amount attributed to that asset or liability for tax purposes. The effect on deferred taxes of a change in tax rates is recognized in the consolidated statement of income and comprehensive income in the period of change. A valuation allowance is provided to reduce the amount of deferred tax assets if it is considered more-likely-than-not that some portion of, or all of the deferred tax assets will not be realized.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Group considers positive and negative evidence when determining whether a portion or all of its deferred tax assets will more likely than not be realized. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts of future profitability, the duration of statutory carry-forward periods, its experience with tax attributes expiring unused, and its tax planning strategies. The ultimate realization of deferred tax assets is dependent upon its ability to generate sufficient future taxable income within the carry-forward periods provided for in the tax law and during the periods in which the temporary differences become deductible. When assessing the realization of deferred tax assets, the Group considers possible sources of taxable income including (i) future reversals of existing taxable temporary differences, (ii) future taxable income exclusive of reversing temporary differences and carry-forwards, (iii) future taxable income arising from implementing tax planning strategies, and (iv) specific known trend of profits expected to be reflected within the industry.

 

*<u>Value added tax</u>*

Revenue represents the invoiced value of goods and services, net of value added tax ("VAT"). The VAT is based on gross sales price with VAT rates of 6% and 13%, depending on the type of products sold or service provided. Entities that are VAT general taxpayers are allowed to offset qualified input VAT paid to suppliers against their output VAT liabilities. Net VAT balance between input VAT and output VAT is recorded in taxes payable. All of the VAT returns filed by the Company's subsidiaries in PRC remain subject to examination by the tax authorities for five years from the date of filing.

 

*<u>Uncertain tax positions</u>*

The Group applies the provisions of ASC topic 740 ("ASC 740"), Accounting for Income Taxes, to account for uncertainty in income taxes. ASC 740 prescribes a recognition threshold a tax position is required to meet before being recognized in the financial statements. The benefit of a tax position is recognized if a tax return position or future tax position is "more likely than not" to be sustained under examination based solely on the technical merits of the position. Tax positions that meet the "more likely than not" recognition threshold is measured, using a cumulative probability approach, at the largest amount of tax benefit that has a greater than fifty percent likelihood of being realized upon settlement. The estimated liability for unrecognized tax benefits is periodically assessed for adequacy and may be affected by changing interpretations of laws, rulings by tax authorities, changes and or developments with respect to tax audits, and the expiration of the statute of limitations. Additionally, in future periods, changes in facts and circumstances, and new information may require the Group to adjust the recognition and measurement of estimates with regards to changes in individual tax position. Changes in recognition and measurement of estimates are recognized in the period in which the change occurs.

The Group's operating subsidiaries in the PRC are subject to examination by the relevant tax authorities. According to the PRC Tax Administration and Collection Law, the statute of limitations is three years if the underpayment of taxes is due to computational errors made by the taxpayer or the withholding agent. The statute of limitations is extended to five years under special circumstances, where the underpayment of taxes is more than RMB100 (US$15). In the case of transfer pricing issues, the statute of limitation is ten years. There is no statute of limitation in the case of tax evasion. Penalties and interests incurred related to underpayment of income tax are classified as income tax expense in the period incurred.

***(x) Comprehensive loss***

The Group has adopted FASB Accounting Standard Codification Topic 220 ("ASC 220") "Comprehensive income", which establishes standards for reporting and the presentation of comprehensive income (loss), its components and accumulated balances.

There was RMB446 and nil other comprehensive loss for the six months ended June 30, 2024 and 2025, respectively.

 ****

***(y) Leases***

The Group accounts for lease under ASC Topic 842, Leases. The Group determines if an arrangement is or contains a lease at inception. Right-of-use assets and liabilities are recognized at lease commencement date based on the present value of remaining lease payments over the lease terms. The Group considers only payments that are fixed and determinable at the time of lease commencement.

At the commencement date, the lease liability is recognized at the present value of the lease payments not yet paid, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Group's incremental borrowing rate for the same term as the underlying lease. The right-of-use asset is recognized initially at cost, which primarily comprises the initial amount of the lease liability, plus any initial direct costs incurred. All right-of-use assets are reviewed for impairment annually. There was no impairment for right-of-use lease assets for the six months ended June 30, 2024 and 2025, respectively.

Operating lease assets are included within "right-of-use assets - operating lease", and the corresponding operating lease liabilities are included within "operating lease liabilities" on the consolidated balance sheets as of December 31, 2024 and June 30, 2025, respectively.

 ****

***(z) Commitments and contingencies***

In the normal course of business, the Group is subject to contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of matters. Liabilities for contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.

If the assessment of a contingency indicates that it is probable that a loss is incurred and the amount of the liability can be estimated, then the estimated liability is accrued in the consolidated financial statements. If the assessment indicates that a potential loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed.

The Group recognized RMB3,000 (US$419) and nil of commitments and contingencies for the six months ended June 30, 2024 and 2025, respectively.

 ****

***(aa) Segment reporting***

ASC 280, *Segment Reporting*, ("ASC 280"), establishes standards for companies to report in their financial statement information about operating segments, products, services, geographic areas, and major customers.

Based on the criteria established by ASC 280, the Group's chief operating decision maker ("CODM") has been identified as the Group's Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Group. As a whole and hence, the Group has only one reportable segment. The Group does not distinguish between markets or segments for the purpose of internal reporting. As the Group's long-lived assets are substantially located in the PRC, no geographical segments are presented.

 ****

***(ab) Recent accounting pronouncements***

In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments – Credit Losses", which requires the measurement of all allowance for expected credit losses for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Subsequently, the FASB issued ASU No. 2018-19, Codification Improvements to Topic 326, to clarify that receivables arising from operating leases are within the scope of lease accounting standards. Further, the FASB issued ASU No. 2019-04, ASU 2019-05, ASU 2019-10, ASU 2019-11 and ASU 2020-02 to provide additional guidance on the credit losses standard, which defers the effective date of ASU No. 2016-13 for smaller reporting companies to fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The impact of the adoption on the consolidated balance sheets, statements of operations, and statements of cash flows was immaterial.

In June 2022, the FASB issued ASU 2023-03 Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions. The update clarifies that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The update also clarifies that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The update also requires certain additional disclosures for equity securities subject to contractual sale restrictions. The amendments in this update are effective for the Group beginning January 1, 2024 on a prospective basis. Early adoption is permitted for both interim and annual financial statements that have not yet been issued or made available for issuance. The Group has determined that the adoption of this guidance will not have a material impact on its financial position, results of operations, and cash flows.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which focuses on improving reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. A public entity shall disclose for each reportable segment the significant expense categories and amounts that are regularly provided to the CODM and included in reported segment profit or loss. ASU 2023-07 also requires public entities to provide in interim periods all disclosures about a reportable segment's profit or loss and assets that are currently required annually. Entities are permitted to disclose more than one measure of a segment's profit or loss if such measures are used by the CODM to allocate resources and assess performance, as long as at least one of those measures is determined in a way that is most consistent with the measurement principles used to measure the corresponding amounts in the consolidated financial statements. ASU 2023-07 is applied retrospectively to all periods presented in financial statements, unless it is impracticable. This update was effective for the Group's fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2024. Early adoption is permitted. Based on the criteria established by ASC 280, the Group's CODM has been identified as the Group's Chief Executive Officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Group. As a whole and hence, the Group has only one reportable segment. The Group does not distinguish between markets or segments for the purpose of internal reporting. As the Group's long-lived assets are substantially located in the PRC, no geographical segments are presented.

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740). The update requires specific disaggregated information about a reporting entity's effective tax rate reconciliation as well as additional information on income taxes paid. The update is effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. The Group has determined that the adoption of this policy will not have a material impact on its consolidated financial statements.

**3. LIQUIDITY**

For the six months ended June 30, 2025, the Group reported a net loss of RMB27,402 (US$3,827), negative operating cash flows of RMB35,934 (US$5,016), net current assets of RMB77,299 (US$10,790), accumulated deficit of RMB243,098 (US$33,935). These conditions raise substantial doubt about the Group's ability to continue as a going concern.

In assessing its liquidity, management monitors and analyzes the Group's cash and cash equivalents, its ability to generate sufficient revenue sources and ability to obtain additional financial support in the future, and its operating and capital expenditure commitments.

The Group's primary source of liquidity historically has been cash generated from its business operations, bank loans, equity contributions from its shareholders and borrowings, which have historically been sufficient to meet its working capital and capital expenditure requirements.

As of the fiscal year ended December 31, 2024 and the six months ended June 30, 2025, the Group's cash and cash equivalents and restricted cash were RMB24,674 and RMB22,997 (US$3,210), respectively, and the Group's restricted cash were RMB1,239 and RMB 300 (US$42), respectively. The Group's cash and cash equivalents primarily consist of cash on hand and highly liquid investments placed with banks, which are unrestricted to withdrawal and use and which have original maturities of three months or less.

The Group believes that the substantial doubt of its ability to continue as going concern is alleviated based on the proceeds received from investors and anticipated increase in cash generated from operations. Meanwhile, on an on-going basis, the Group has also received financial support commitments from the Company's key management which allow the Group to meet its other liabilities and commitments. The Group received an additional capital injection of RMB 33,397 (US$4,662). The Group believes its existing cash and cash equivalents, anticipated cash raised from financings, and anticipated cash flow from operations, will be sufficient to meet its anticipated cash needs for the next 12 months from the date of this report. The exact amount of proceeds the Group will use for its operations and expansion plans will depend on the amount of cash generated from its operations and any strategic decisions the Group may make that could alter its expansion plans and the amount of cash necessary to fund these plans.

The management believes that the Group will continue as a going concern in the following 12 months from the date the Group's half of 2025 consolidated financial statements are issued. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the ordinary course of business. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described above.

**4. CONCENTRATION OF RISKS**

 ****

***(a) Political, social and economic risks***

The Group's operations could be adversely affected by significant political, economic and social uncertainties in the PRC. Although the PRC government has been pursuing economic reform policies for more than 20 years, no assurance can be given that the PRC government will continue to pursue such policies or that such policies may not be significantly altered, especially in the event of a change in leadership, social or political disruption or unforeseen circumstances affecting the PRC political, economic and social conditions. There is also no guarantee that the PRC government's pursuit of economic reforms will be consistent or effective.

 ****

***(b) Interest rate risk***

The Group is exposed to interest rate risk on its interest-bearing assets and liabilities. As part of its asset and liability risk management, the Group reviews and takes appropriate steps to manage its interest rate exposure on its interest-bearing assets and liabilities. The Group has not been exposed to material risks due to changes in market interest rates, and has not used any derivative financial instruments to manage the interest risk exposure during the years presented.

 ****

***(c) Credit risk***

Financial instruments that potentially subject the Group to significant concentrations of credit risk consist primarily of cash. As of the fiscal year ended December 31, 2024 and the six months ended June 30, 2025, approximately RMB24,674 and RMB22,997 (US$3,210) of cash and cash equivalents and restricted cash were deposited with financial institutions located in the PRC, respectively, where there is a RMB500 deposit insurance limit for a legal entity's aggregated balance at each bank. While the Group believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness.

The Group is also exposed to risk from its accounts receivable and other receivables. These assets are subjected to credit evaluations. An allowance has been made for estimated unrecoverable amounts which have been determined by reference to past default experience and the current economic environment.

 ****

***(d) Currency convertibility risk***

Substantially the Group's operating activities are settled in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the People's Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People's Bank of China. Approval of foreign currency payments by the People's Bank of China or other regulatory institutions requires submitting a payment application form together with supporting documents.

**5. ACCOUNTS RECEIVABLE**

Accounts receivable and the allowance for expected credit losses consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of<br> December 31,<br> 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited）** | **(Unaudited）** |
| Accounts receivable | 11975 | 19963 | 2786 |
| Less: allowance for expected credit losses | (1601) | (1607) | (224) |
|  | **10374** | **18356** | **2562** |

---

As of the fiscal year ended December 31, 2024 and the six months ended June 30, 2025, all accounts receivable were due from third-party customers. There was nil and RMB6(US$1) of allowance for expected credit losses recognized for the six months ended June 30, 2024 and 2025, respectively.

The movement of allowance of expected credit loss was as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **December 31, <br> 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| At the beginning of the year | (37) | (1601) | (223) |
| Additions | (1564) | (6) | (1) |
| **At the end of the period** | **(1601)** | **(1607)** | **(224)** |

---

**6. INVENTORY**

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited）** | **(Unaudited）** |
| Raw materials | 3358 | 5166 | 720 |
| Low value consumables | 34 | 34 | 5 |
| Finished goods | 6492 | 7780 | 1087 |
| Less: inventory impairment | (12) | - | - |
|  | **9872** | **12980** | **1812** |

---

There was nil and nil impairment of inventory recognized for the six months ended June 30, 2024 and 2025.

**7. ADVANCE TO SUPPLIERS**

Advance to suppliers consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited）** | **(Unaudited）** |
| Advance to suppliers | 17789 | 14251 | 1990 |
| Less: allowance for expected credit losses | (8323) | (4443) | (621) |
|  | **9466** | **9808** | **1369** |

---

As of the fiscal year ended December 31, 2024, the balance of advance to suppliers mainly represented the prepayments in relation to the development and purchase of battery-swapping stations as well as the development of UOTTA-powered EVs. As of the six months ended June 30, 2025, the balance of advance to suppliers mainly represented the prepayments in relation to the development of vehicle sourcing, general and administrative expenses, and purchase of battery-swapping stations. An analysis of the expected credit losses was as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited）** | **(Unaudited）** |
| Balance at beginning of the period | (8472) | (8323) | (1163) |
| Additional reversal for expected credit losses | 149 | 3880 | 542 |
| **Balance at the end of the period** | **(8323)** | **(4443)** | **(621)** |

---

**8. OTHER CURRENT ASSETS AND NON-CURRENT ASSETS**

Other current assets consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited）** | **(Unaudited）** |
| Value-added tax recoverable | 8061 | 8816 | 1231 |
| Loans to third parties (i) | 21305 | 20320 | 2837 |
| Deposits | 4590 | 3111 | 435 |
| Staff advances | 708 | 3572 | 498 |
| Others | 705 | 1700 | 237 |
| Less: Allowance for expected credit losses | (6337) | (6307) | (881) |
|  | **29032** | **31212** | **4357** |

---

(i) In January 2023, LY New Energy, Youpin, Youxu Zibo, and HN Youxu, respectively,
entered into an one-year loan agreement with Shanghai Huazhen Construction Engineering Co., Ltd ("SH Huazhen"), pursuant to
which LY New Energy, Youpin, Youxu Zibo, and HN Youxu agreed to lend a total loan amount of RMB12,560 (US$1,769) with no free interest
rate to SH Huazhen for its working capital needs. As of June 30, 2025, the balance of loans to SH Huazhen is RMB11,452 (US$1,599). SH
Huazhen has provided assurances regarding the repayment schedule of the relevant borrowings, committing to fully settle all outstanding
liabilities within one year. As of June 30, 2025, Huazhen has repaid RMB 1,322 (US$185). In December 2023, Youguan Financial Leasing entered into one-year revolving
loan agreements with Cao Yue, Gong Hua and He Guangquan for revolving loan quota. Each individual was granted a loan quota of RMB2.4 million.
Under these agreements, Youguan Financial Leasing agreed to lend a total loan amount of RMB3,000 with no interest rate. As of the date
of this report, the loan balance is RMB628 (US$88).

An analysis of the doubtful accounts was as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited）** | **(Unaudited）** |
| Balance at beginning of the period | (2488) | (6337) | (886) |
| Additional (allowance)/reversal for doubtful accounts | (3849) | 30 | 5 |
| **Balance at the end of the period** | **(6337)** | **(6307)** | **(881)** |

---

Other non-current assets consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| Loans to third parties (ii) | 81552 | 80059 | 11176 |
| Long-term deferred expenses(iii) | 181 | 154 | 20 |
|  | **81733** | **80213** | **11196** |

---

---

| | |
|:---|:---|
| (ii) | On March 31, 2023, the Company entered into a five-year loan agreement with Worthy Credit Limited ("Worthy Credit"), pursuant to which the Company provided a loan of $5,000 to Worthy Credit bearing an interest rate of 2% per annual. Worthy Credit agreed to provide loan services to the Company's customers who purchase the Company's products sold in HK. As of June 30, 2025, the loan is not yet to be granted to any customers due to the fact that the Company's vehicle product is still at certification stage and there is no contract entered into yet with any dealers or purchasers of battery-swapping stations. However, the Group's first batch of battery swap station equipment has been successfully delivered to Hong Kong, with substantive cooperation established with local enterprises regarding equipment installation and operational management. Consequently, the Group anticipates that the project's progress will align with initial expectations, and the collaborative business with Worthy Credit is expected to proceed. |
|  | In April 2023, the Company entered into a cooperation agreement with Richness Fortune Credit (HK) Company Limited ("Richness"), whereby the Group agreed to provide a $6,000 loan to facilitate Richness' identification of potential investment targets. However, due to persistent weakness in the investment market, the investment opportunities presented by Richness failed to meet management's expectations, resulting in the funds remaining unutilized. Subsequently, on December 31, 2024, the Company and Richness executed an amendment agreement to extend the cooperation term through December 2028 and to provide for an annual interest charge of $600,000, commencing in 2025. |

---

&nbsp;&nbsp;&nbsp;&nbsp;(iii) On September 11, 2024, Youxu Zibo entered into a design service contract with Shanghai Kunying Technology Co., Ltd. for battery swap station projects. Under the agreement, design service costs are recognized in accordance with the construction progress of the respective battery swap stations. Costs related to uncompleted stations that have not passed final inspection are capitalized as long-term deferred expenses. As of June 30, 2025, the Company had RMB 154 in unamortized design fees capitalized under long-term deferred expenses.

**9. PROPERTY, PLANT AND EQUIPMENT, NET**

Property and equipment consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| Leasehold improvements | 534 | 534 | 75 |
| Computer and network equipment | 2457 | 2468 | 344 |
| Manufacturing equipment | 12460 | 13788 | 1925 |
| Office equipment | 288 | 288 | 40 |
| Motor vehicles | 4367 | 4509 | 629 |
| Construction in process | - | 94 | 13 |
|  | **20106** | **21680** | **3026** |
| Less: loss of impairment | (1896) | (1896) | (265) |
| Less: Accumulated depreciation | (9554) | (11137) | (1554) |
|  | **8656** | **8647** | **1207** |

---

For the six months ended June 30, 2024 and 2025, the Group recorded depreciation expenses of RMB2,606 and RMB1,583 (US$221), respectively.

The loss of the impairment was due to the permanent withdrawn of a production line made in 2023.

**10. INTANGIBLE ASSETS, NET**

The following table presents the Group's intangible assets as of the respective balance sheet dates:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Purchased<br> software** | **Internal - use<br> software** | **Total** | **Total** |
|  | **RMB** | **RMB** | **RMB** | **US$** |
| **Net balance as of December 31, 2024** | 132 |  | 132 | 19 |
| Additions |  |  |  |  |
| Amortization expense | (35) |  | (35) | (5) |
| **Net balance as of June 30, 2025** | **97** |  | **97** | **14** |

---

The intangible assets are amortized using the straight-line method, which is the Group's best estimate of how these assets will be economically consumed over their respective estimated useful lives of one to ten years.

Amortization expenses for intangible assets were RMB34 and RMB35 (US$5) for the six months ended June 30, 2024 and 2025, respectively. No impairment charge was recorded for the six months ended June 30, 2024 and 2025, respectively.

The annual estimated amortization expenses for the intangible assets for each of the next two years are as follows:

---

| | | |
|:---|:---|:---|
|  | **RMB** | **US$** |
| 2025 (July – December) | 36 | 5 |
| 2026 | 61 | 9 |
|  | **97** | **14** |

---

**11. LONG-TERM INVESTMENTS**

The Group's long-term investments consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| ***Equity investments:*** | | | |
| Zibo Hengxin Investment Partnership (Limited Partnership) ("Zibo Hengxin") (i) | 120006 | 120006 | 16753 |
| Huzhou Zheyou New Energy Sales Co., Ltd. ("Huzhou Zheyou") (ii) | 3121 | 3004 | 418 |
| MATSON (HONG KONG) (iii) | 20773 | 20767 | 2899 |
| UNEX EV B.V (iv) | 717 | 752 | 105 |
| Less: impairment on equity investments | (10503) | (10503) | (1466) |
|  | **134114** | **134026** | **18709** |

---

(i) In December 2020, the Group
entered into a partnership agreement with Zibo Hengxin and its participating shareholder, Guanmiao (Beijing) Investment Management Co.,
Ltd. ("Guanmiao"), whereby the Group agreed to purchased limited partnership interest in Zibo Hengxin Investment (the "Fund")
in the amount of RMB120,000, which entitles the Group an aggregate interest of approximately 99% in Zibo Hengxin. In December 2021, Zibo
Hengxin decreased its total partnership capital to RMB111,200 and returned to the Group RMB10,000, consequently, the aggregate interest
of the Group was diluted to 98.9%. In October 2023, the Group invested RMB10,000 into Zibo Hengxin Investment Partnership, resulting
in the Group holding approximately 99% interest in Zibo Hengxin. There was no unfunded commitment to Zibo Hengxin as of December 31,
2024. For the six months ended June 30, 2025, the Group made an impairment provision of about RMB10.5 million (US$1.4 million) for this
long-term equity investment.

The Fund's investment strategy is primarily to invest in emerging companies of new energy automobile industry. The Fund is scheduled to be in existence until 2025, unless terminated sooner or extended in accordance with the amended and restated limited partnership agreement.

(ii) In April 2022, the Group
entered into an agreement to invest in Huzhou Zheyou New Energy Sales Co., Ltd. ("Huzhou Zheyou"), with contributed RMB1,750
in June 2022 and RMB1,750 in November 2023, respectively. The Group held an equity interest of 35% as of December 31, 2024. For the six
months ended June 30, 2025, the Group recorded an investment loss of RMB118 from the operating result of Huzhou Zheyou. The investment
losses have been disclosed in share of loss in equity method investee of consolidated statement of cash flow.

(iii) On February 6, 2024, the
Company and Zeng Lingzhi, the sole beneficial owner of Matson, a private company with limited liability incorporated under the laws of
Hong Kong entered into a share exchange agreement (the "Agreement"), pursuant to shich Agreement, the Company agreed to acquire
3,560 ordinary shares of Matson (the "Matson Shares"), which represent 26.25% of Matson's total equity, for 30,000,000
ordinary shares of the Company.

(iv) The Group entered into
an agreement to invest in UNEX EV B.V, and contributed RMB736 in July 2024. The Group held an equity interest of 9% of UNEX EV B.V. For
the six months ended June 30, 2025, the Group recorded an investment loss of RMB48 from the operating result of UNEX EV B.V.

The balance represented loans to Shanghai Lingneng Electricity Selling Co., Ltd. ("SH Lingneng") for its operations pursuant to loan agreements entered into in 2019, bearing an interest rate of 3% per annum. Subsequently in August 2023, the Company entered into a term sheet, the result of which would be the investment into SH Lingneng's interest equity ("Transaction"). Final terms and arrangements of this potential Transaction would be determined on Share Purchase Agreement ("SPA"), Shareholders' Agreement ("SHA"), Memorandum of Association ("MA") and other documents associated with the Transaction. As of December 31, 2022, the balance of the refundable deposit for investment is RMB80,183, the Company has recovered RMB7,409 of the refundable investment funds in 2023, and the balance of the refundable deposit for investment is RMB72,774 (US$10,250) as of December 31, 2023. On February 28, 2024, the Company entered into an investment termination agreement, pursuant to which Shanghai Lingneng shall pay no less than one third of the total amount per annum in the following three years. As of June 30, 2025, the Company has received a refund of RMB19,178 (US$2,677).

**13. BANK BORROWINGS**

Bank borrowings were as follows as of the respective balance sheet dates:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| Short-term bank borrowing (i) | 15172 | 17172 | 2397 |
| Long-term bank borrowing, current portion | 2800 | 5800 | 810 |
| Long-term bank borrowing, non-current portion (ii) | 3700 | - | - |
|  | **21672** | **22972** | **3207** |

---

(i) As of June,30, 2025, Youxu Zibo entered into a one-year short-term
bank loan of RMB200 on February 21, 2025, at an annual interest rate of 3.45%.

(ii) As of June 30, 2025, Youxu Zibo repaid RMB700 of its bank borrowings
from Bank of Qishang.

**14. ACCRUED EXPENSES AND OTHER LIABILITIES**

Accrued expenses and other liabilities consisted of the following:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| Payroll and welfare payables | 4856 | 6732 | 940 |
| Loans from third parties | 4787 | 2780 | 388 |
| Payable to Anhui Juhu (ii) | 200 | 200 | 28 |
| Payable to Yidong (iii) |  | 893 | 125 |
| Interest payables |  | 8 | 1 |
| Customer deposit | 363 | 408 | 57 |
| Accrued expenses | 334 | 713 | 100 |
| Deferred consideration in relation to investment (i) | 2300 |  |  |
| Others | 441 | 488 | 67 |
|  | **13281** | **12222** | **1706** |

---

(i) In June 2021, AHYS and Youpin entered into an equity transfer agreement with Ningbo Tuowei Equity Investment Partnership (Limited Partnership) ("Ningbo Tuowei"), the shareholder who owned 0.5533% share equity of Youpin. Pursuant to the agreement, Ningbo Tuowei agreed to transfer its all 0.5533% share equity of Youpin for a total consideration of RMB6,000 to AHYS. As of December 31, 2024, the outstanding balance of this deferred consideration in relation to investment was RMB2,300 (US$315).

(ii) In February 2023, Youpin was sued by Anhui Juhu Doors & Windows Technology Co., Ltd. for alleged unpaid rent amounting to RMB3,245 (approximately $457). As defendant, Youpin reached a settlement agreement on July 29, 2024, which established the final payable amount at RMB2,000. As of 30 June, 2025, the Group had RMB 200 of litigation payments remaining to be paid. Consequently, the Company has reclassified this obligation from commitments and contingencies to accrued expenses and other liabilities in the consolidated financial statements.

(iii) Xiamen Youxu and Youpin Shandong are the defendants in this case, with Yidong New Energy Technology Co., Ltd. as the plaintiff. The parties entered into a battery lease agreement in July 2022, under which the defendants agreed to lease new energy vehicles provided by the plaintiff. During the performance of the contract, the defendants discovered quality issues with the vehicle batteries supplied by the plaintiff. After multiple rounds of failed negotiations to resolve the issues, the defendants terminated the cooperation. The plaintiff subsequently filed a lawsuit, citing the defendants' failure to pay rent on time. The case was first heard in court on September 11, 2025, the two parties reached a settlement in court. According to the settlement agreement issued by the court, the defendant is required to pay the outstanding compensation of RMB 892 to the plaintiff within the specified period. Upon receiving the mediation agreement, the company has recorded the relevant amount in other expenses and other payables.

**15. LEASES**

The Company leases buildings, office facilities, land use rights and batteries in PRC. The Company does not have any finance leases for the fiscal year ended December 31, 2024, and for the six months ended June 30, 2025, respectively. Operating leases result in the recognition of right-of-use ("ROU") assets and lease liabilities on the balance sheet. ROU assets represent the Company's right to use the leased asset for the lease term, and lease liabilities represent the obligation to make lease payments. The operating lease expenses were charged to cost of sales, research and development expenses and general and administrative expenses.

A summary of supplemental information related to operating leases as of the fiscal year ended December 31, 2024 and the six months ended June 30, 2025 was as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| Operating lease right-of-use assets, net | 16205 | 12003 | 1676 |
| Operating lease liabilities, current | 1843 | 981 | 137 |
| Operating lease liabilities, non-current | 4137 | 2933 | 409 |
| Weighted average remaining lease terms | 3.22 years | 2.72 years | 2.72 years |
| Weighted average discount rate | 4.64% | 3.95% | 3.95% |

---

Future lease payments under operating leases as of June 30, 2025 were as follows:

---

| | |
|:---|:---|
|  | **As of<br> June 30, <br> 2025** |
|  | **RMB** |
|  | **(Unaudited)** |
| FY2025 | 1137 |
| FY2026 | 2028 |
| FY2027 | 1246 |
| FY2028 | 779 |
| FY2029 | 465 |
| FY2030 | 319 |
| FY2031 | - |
| Total future lease payment | 5974 |
| less: imputed interest | (2060) |
| Represent value of future lease payments<sup>(i)</sup> | **3914** |

---

(i) Present value of future operating lease payments consisted of current portion of operating lease liabilities and non-current portion of operating lease liabilities, amounting to RMB981 (US$137) and RMB2,933 (US$409) as of June 30, 2025.

**16. RELATED PARTY TRANSACTIONS**

Major related parties that transacted with the Group and their respective relationship to the Group are listed as below:

---

| | |
|:---|:---|
| **Names of the related parties** | **Relationship with the Group** |
| Hangzhou Youyue Travel Technology Co., Ltd. ("Hangzhou Youyue") | An affiliate of Bingyi Zhao |
| Shanghai Youzhang Commerical Information Consulting Partnership (Limited Partnership) ("Shanghai Youzhang") | An affiliate of Jia Li |
| Ningbo Youheng Automobile Service Co., Ltd. ("Ningbo Youheng Automobile" | An affiliate of Jia Li |
| Zhejiang Youxiaodian Automobile Service Co., Ltd. ("Zhejiang Youxiaodian") | An affiliate of Jia Li |
| Qingshan Wei | Controlling shareholder of U Power Limited |
| Youjia Technology (Shanghai) Co., Ltd. ("Youjia Technology") | An affiliate of Jia Li |
| Shanghai Youpinsuoer New Energy Technology Co., Ltd. ("Shanghai Youpinsuoer") | An affiliate of Jia Li |
| Jia Li | Controlling shareholder, Director and CEO of U Power Limited |
| Bingyi Zhao | Director and Chief Financial Officer of U Power Limited |
| Shandong Youyidian Automobile Technology Co., Ltd. ("Shandong Youyidian") | An affiliate of Jia Li |
| Youche Jingpin E-commerce (Shanghai) Co., Ltd. ("Youche Jingpin") | An affiliate of Jia Li |
| Shanghai Youcang Business Consulting Partnership (Limited Partnership) ("Shanghai Youcang") | An affiliate of Jia Li |
| Nanmu (Shanghai) Financial Leasing Co., Ltd("Nanmu") | An affiliate of Jia Li |
| Ke Li | Director of U Power Limited |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a) Amounts due from related parties**

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| Nanmu (Shanghai) Financial Leasing Co., Ltd | 20001 | 40002 | 5584 |
| Jia Li | 583 | 4330 | 604 |
| Ke Li | 438 | 320 | 45 |
| Shanghai Youcang | 100 |  |  |
| Bingyi Zhao | 535 | 413 | 58 |
|  | **21657** | **45065** | **6291** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b) Amounts due to related parties**

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| Ke Li | 3020 | 20 | 3 |
| Jia Li |  | 924 | 129 |
| Bingyi Zhao | 219 | 215 | 30 |
| UNEX EV | - | 1361 | 190 |
|  | **3239** | **2520** | **352** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c) Related party's transactions**

---

| | | | |
|:---|:---|:---|:---|
|  | **For the years ended December 31,** | **For the years ended December 31,** | **For the years ended December 31,** |
|  | **2024** | **2025** | **2025** |
|  | **RMB** | **RMB** | **US$** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| Loans to Nanmu (Shanghai) Financial Leasing Co., Ltd |  | 20001 | 2792 |
| Loans to Jia Li | 248 | 3747 | 523 |
| Loans to Ke Li |  | (118) | (16) |
| Loans to Shanghai Youcang | (11) | (100) | (14) |
| Loans to Bingyi Zhao | 27 |  |  |
| Loans to Bingyi Zhao |  | (122) | (17) |
| Loans from Ke Li | (4170) | (3000) | (419) |
| Loans from Jia Li | (582) | 924 | 129 |
| Loans from Bingyi Zhao | (382) | (4) | (1) |
| Loans from UNEX EV |  | 1361 | 190 |
| Loans from Hangzhou Youyue | (6) |  |  |

---

**17. EMPLOYEE BENEFIT EXPENSES**

All eligible employees of the Group are entitled to staff welfare benefits, including medical care, welfare subsidies, unemployment insurance and pension benefits through a PRC government-mandated multi-employer defined contribution plan. The Group is required to make contributions to the plan and accrues these benefits based on certain percentages of the qualified employees' salaries. The Group recorded employee benefit expenses of RMB1,231 and RMB1,292 (US$180) for the six months ended June 30, 2024 and 2025, respectively.

**18. INCOME TAXES**

 ****

***Cayman Islands***

The Company is incorporated in the Cayman Islands and conducts its primary business operations through the subsidiaries in the PRC and Hong Kong. Under the current laws of the Cayman Islands, the Cayman Islands levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and the Company is, therefore, not subject to tax on income or capital gains arising in Cayman Islands.

 ****

***British Virgin Islands***

Subsidiaries in British Virgin Islands are not subject to tax on income or capital gains under the current laws of the British Virgin Islands. Additionally, upon payments of dividends by the Company to its shareholders, no British Virgin Islands withholding tax will be imposed.

 ****

***Hong Kong***

Subsidiaries in Hong Kong are subject to a two-tiered income tax rate for taxable income earned in Hong Kong. The first 2,000 Hong Kong dollars of profits earned by a company is subject to be taxed at an income tax rate of 8.25%, while the remaining profits will continue to be taxed at the existing tax rate of 16.5%. No provision for Hong Kong profits tax has been made in the consolidated financial statements, as it has no assessable profit for the six months ended June 30, 2024 and 2025, respectively.

 ****

***PRC***

The Company's PRC subsidiaries are incorporated in the PRC and subject to the statutory rate of 25% on the taxable income in accordance with the Enterprise Income Tax Law (the "EIT Law"), which was effective since January 1, 2008, except for certain entities eligible for preferential tax rates.

Dividends, interests, rent or royalties payable by the Company's PRC subsidiaries, to non-PRC resident enterprises, and proceeds from any such non-resident enterprise investor's disposition of assets (after deducting the net value of such assets) shall be subject to 10% withholding tax, unless the respective non-PRC resident enterprise's jurisdiction of incorporation has a tax treaty or arrangements with China that provides for a reduced withholding tax rate or an exemption from withholding tax.

The EIT Law also provides that enterprises established under the laws of foreign countries or regions and whose "place of effective management" is located within the PRC are considered PRC tax resident enterprises and subject to PRC income tax at the rate of 25% on worldwide income. The definition of "place of effective management" refers to an establishment that exercises, in substance, overall management and control over the production and business, personnel, accounting, properties, etc. of an enterprise.

As of June 30, 2025, the administrative practice associated with interpreting and applying the concept of "place of effective management" is unclear. If the Company is deemed as a PRC tax resident, it will be subject to 25% PRC enterprise income tax under the EIT Law on its worldwide income, meanwhile the dividend it receives from another PRC tax resident company will be exempted from 25% PRC income tax. The Company will continue to monitor changes in the interpretation or guidance of this law.

Loss before income taxes consisted of:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2025** | **2025** |
|  | **RMB** | **RMB** | **US$** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| Non-PRC | (6113) | (4143) | (579) |
| PRC | (20403) | (22933) | (3202) |
|  | **(26516)** | **(27076)** | **(3781)** |

---

The following table presents the composition of income tax expenses for the six months ended June 30, 2024 and 2025:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2025** | **2025** |
|  | **RMB** | **RMB** | **US$** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| Current income tax expense |  | 326 | 46 |
|  |  | **326** | **46** |

---

The reconciliation of the effective tax rate and the statutory income tax rate applicable to PRC operations are as follow:

---

| | | | |
|:---|:---|:---|:---|
|  | | **For the Six Months Ended** | **For the Six Months Ended** |
|  | **For the years<br> ended<br> December 31,**<br>**2024** | **June 30, 2025** | **June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| Loss before provision for income taxes | (56362) | (27076) | (3781) |
| Income tax benefit computed at an applicable tax rate of 25% | (14091) | (6769) | (945) |
| The effect of different tax rate | 659 | 111 | 15 |
| Change in valuation allowance | 13432 | 6984 | 975 |
| Income tax expense | - | 326 | 46 |

---

***Deferred Taxes***

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Group's deferred tax assets and deferred tax liabilities are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of<br> December 31, 2024** | **As of<br> June 30, 2025** | **As of<br> June 30, 2025** |
|  | **RMB** | **RMB** | **US$** |
|  | | **(Unaudited)** | **(Unaudited)** |
| **Deferred tax assets:** | | | |
| Intra-group transaction | 45483 | 52467 | 7324 |
| **Total deferred tax assets** | 45483 | 52467 | 7324 |
| Less: valuation allowance | **(45483)** | **(52467)** | **(7324)** |
| **Deferred tax assets, net** | **-** | **-** | **-** |

---

***Uncertain tax positions***

The Group evaluates each uncertain tax position (including the potential application of interest and penalties) based on the technical merits, and measure the unrecognized benefits associated with the tax positions. As of the fiscal year ended December 31, 2024 and the six months ended June 30, 2025, the Group did not have any significant unrecognized uncertain tax positions.

The Group did not accrue any liability, interest or penalties related to uncertain tax positions in its provision for income taxes line of its condensed consolidated statements of operations for the periods ended June 30, 2024 and 2025, respectively.

**19. RESTRICTED NET ASSETS**

Relevant PRC statutory laws and regulations permit payments of dividends by the Group's PRC subsidiaries only out of their retained earnings, if any, as determined in accordance with PRC accounting standards and regulations. The results of operations reflected in the financial statements prepared in accordance with U.S. GAAP differ from those reflected in the statutory financial statements of the Company's subsidiaries.

In accordance with the Regulations on Enterprises with Foreign Investment of China, a foreign invested enterprise established in the PRC is required to provide certain statutory reserves, namely general reserve fund, enterprise expansion fund, and staff welfare and bonus fund which are appropriated from net profit as reported in the enterprise's PRC statutory accounts, which is included in retained earnings accounts in equity section of the consolidated balance sheets. A wholly foreign owned invested enterprise is required to allocate at least 10% of its annual after-tax profit to the general reserve until such reserve reaches 50% of its respective registered capital based on the enterprise's PRC statutory accounts.

Appropriations to the enterprise expansion fund and staff welfare and bonus fund are at the discretion of the board of directors for all foreign invested enterprises. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. If any PRC subsidiary incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay dividends or make other payments to the Group. Any limitation on the ability of the PRC subsidiaries to distribute dividends or other payments to their respective shareholders could materially and adversely limit the ability to grow, make investments or acquisitions that could be beneficial to pay dividends.

Additionally, in accordance with the Company Law of the PRC, a domestic enterprise is required to provide a statutory common reserve of at least 10% of its annual after-tax profit until such reserve reaches 50% of its respective registered capital based on the enterprise's PRC statutory accounts. The Group's provision for the statutory common reserve is in compliance with the aforementioned requirement of the Company Law. A domestic enterprise is also required to provide for discretionary surplus reserve, at the discretion of the board of directors, from the profits determined in accordance with the enterprise's PRC statutory accounts. The aforementioned reserves can only be used for specific purposes and are not distributable as cash dividends. For the six months ended June 30, 2024 and 2025, the PRC subsidiaries did not have after-tax profit, and therefore, no statutory reserves were allocated.

Because the Group's entities in the PRC can only be paid out of distributable profits reported in accordance with PRC accounting standards, the Group's entities in the PRC are restricted from transferring a portion of their net assets to the Company. The restricted amounts include the paid-in capital and additional paid-in capital of the Group's entities in the PRC. The aggregate amount of paid-in capital and additional paid-in capital, which is the amount of net assets of the Group's entities in the PRC (mainland) not available for distribution, were RMB818,712 and RMB862,978 (US$120,467) as of the fiscal year ended December 31, 2024 and the six months ended June 30, 2025, respectively.

**20. LOSS PER SHARE**

Basic and diluted earnings per share for the years presented were calculated as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** | **For the Six Months Ended June 30,** |
|  | **2024** | **2025** | **2025** |
|  | **RMB** | **RMB** | **US$** |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| ***Numerator:*** |  |  |  |
| &nbsp;&nbsp;&nbsp;Net loss | (26516) | (27402) | (3827) |
| &nbsp;&nbsp;&nbsp;Less: net loss attributable to non-controlling interest | (2991) | (5402) | (754) |
| &nbsp;&nbsp;&nbsp;**Net loss attributable to the Company's ordinary shareholders** | **(23525)** | **(22000)** | **(3073)** |
| ***Denominator:*** |  |  |  |
| &nbsp;&nbsp;&nbsp;Weighted average number of ordinary shares outstanding used in calculating basic and diluted earnings per share | 3168544 | 3802047 | 3802047 |
| Basic and diluted earnings per share: | (7.42) | (5.79) | (0.81) |

---

**21. COMMITMENTS AND CONTINGENCIES**

 ****

***Commitments***

The assets pledged as collaterals for loans of the Group is discussed in Note 13. BANK BORROWINGS.

 ****

The following table sets forth the Group's contractual obligations as of June 30, 2025:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** | **Payment due by period** |
|  | **Total** | **Total** | **Less than<br> 1 year** | **1-3 years** | **3-5 years** | **More than<br> 5 years** |
|  | **RMB** | **US$** | | | | |
|  | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** | **(Unaudited)** |
| Current portion of long-term borrowing (i) | 5800 | 810 | 5800 |  |  |  |
| Short-term bank borrowing | 17172 | 2397 | 17172 |  |  |  |
| Operating lease liabilities (ii) | 5974 | 834 | 2282 | 3140 | 552 |  |
| **Total** | **28946** | **4041** | **25254** | **3140** | **552** |  |

---

(i) Youxu Zibo's commitment for long-term bank borrowings as of June 30, 2025 is discussed in Note 13. BANK BORROWINGS.

(ii) Our commitment for minimum lease payments under the remaining operating leases as of June 30, 2025, is discussed in Note 15. LEASES.

***Contingencies***

The Group is subject to legal proceedings and regulatory actions in the ordinary course of business. The results of such proceedings cannot be predicted with certainty, but the Group does not anticipate that the final outcome arising out of any such matter will have a material adverse effect on the Group's consolidated business, financial position, cash flows or results of operations taken as a whole except the following:

On July 1, 2021, Youpin Automobile Service Group Co., Ltd. ("Youpin") signed an Investment Contract with the Wuhu High-Tech Industrial Development Zone Management Committee (the "Committee") for a new energy vehicle industrial cluster project. Youpin set up Wuhu Youxu New Energy Technology Co., Ltd. as the project company, and the Committee agreed to provide financial subsidies. On October 15, 2021, the Committee paid the first-year rental subsidy (RMB3 million) to the project company. However, because Youpin and the project company failed to meet operational targets, the Committee issued an Administrative Decision on August 29, 2024, demanded youpin to repay the RMB3 million subsidy. The Group reckon that the investment contract does not qualify as an administrative agreement, and defendant lacks authority to issue administrative decisions based on it. Youpin Group maintains that its non-compliance with the Investment Contract terms resulted from uncontrollable external factors, specifically the original landlord's failure to vacate the premises as scheduled coupled with the disruptive effects of the COVID-19 pandemic, both of which constitute force majeure circumstances. As of the reporting date, the court has not yet rendered a final judgment on this case. Accordingly, the Group considers the ultimate outcome of this litigation to be subject to significant uncertainty. Consequently, applying the prudence principle, the company has made a provision for the litigation amount and recorded it as a non-operating expense in its financial statements.

The defendants in this case are Quanzhou Youyi Dianhuan Network Technology Co., Ltd., Youpin Automobile Service (Shandong) Co., Ltd., and SH Youxu. The plaintiff, Quanzhou Meibiao Youxin Automobile Sales Service Co., Ltd., filed the following claims: (1) payment of RMB 700,000 for battery costs plus interest on delayed payment (calculated at 1.5 times the LPR from the filing date until full payment); and (2) coverage of all litigation fees by the defendants. The Quanzhou Fengze District People's Court accepted the case, which was heard on March 22, 2024. On April 10, 2024, both parties conducted additional online cross-examination of supplementary evidence. On July 10, 2024, the court ruled in favor of the plaintiff, ordering Shandong Youpin to pay the battery costs and interest. On July 25, 2024, Shandong Youpin appealed to the Quanzhou Intermediate People's Court. On November 8, 2024, the Quanzhou Intermediate Court ruled to overturn the original judgment and remand the case to the Quanzhou Fengze District People's Court for retrial. On July 21, 2025, the Quanzhou Fengze District People's Court held a retrial hearing, and the judgment is pending.

Liaoning Youguan and Youpin are the defendants in a dispute with the Dalian Jinpu New Area Administrative Committee. The parties entered into a cooperative investment agreement concerning new energy vehicles and related industries, under which the plaintiff provided financial support funds to the defendants subject to certain conditions. The plaintiff is seeking repayment of the support funds in the amount of RMB9,887, plus interest of RMB1,483. The defendants maintain that they have not materially breached the agreement and note that the agreement does not specify the criteria for determining a breach. The case was accepted by the Dalian Arbitration Commission on April 30, 2025.

SH Youxu and Youxu Nanyang are the defendants in a dispute with Shanghai Jiehuan Intelligent Technology Co., Ltd. The parties previously entered into a debt-to-equity swap agreement concerning multiple creditor's rights, under which the defendants were required to complete the equity transfer by May 31, 2025. Due to the procedural timeline required for the equity transfer, the defendants did not complete it by the deadline. As a result, the plaintiff filed a claim seeking payment of the outstanding debt of RMB5,800. The first court hearing was held on August 12, 2025, and no judgment has been rendered to date. The parties are currently negotiating a potential out-of-court settlement.

Youxu Zibo and Youpin Shandong are the defendants in a dispute with Shandong Qiying Industrial Investment and Development Co., Ltd. The parties entered into a contract in 2022, under which the defendants were to lease the plaintiff's factory building and dormitories through an equity transfer arrangement. In 2025, the plaintiff filed a lawsuit requesting the court to order the defendants to pay RMB7,608 in rent and RMB619 in liquidated damages. The case was heard on September 12, 2025, and no judgment has been rendered as of the date of this report.

On January 9, 2024, Youguan Financial Leasing (China) Co., Ltd. filed a lawsuit against Sichuan Maichebang Automobile Sales Co., Ltd., Yuan Mingqin, and Yuan Jinsong, seeking payment of rent and liquidated damages totaling RMB1,949. The case was accepted by the court. On July 21, 2025, the court issued a judgment ordering the defendants to pay the plaintiff rent and liquidated damages totaling RMB1,378.

Quanzhou Youyi Power Exchange Network Technology Co., Ltd., Youpin SD, and SH Youxu were sued by Quanzhou Meibiaoyouxin Automobile Sales Service Co., Ltd. for payment of RMB700 (US$96) and liquidated damages. On July 25, 2024, Shandong Youpin filed an appeal with the Quanzhou Intermediate People's Court. On November 8, 2024, the Quanzhou Intermediate People's Court overturned the original judgment and remanded the case to the Quanzhou Fengze District People's Court for retrial. A retrial hearing was held on July 21, 2025, and the judgment is currently pending.

AHYS, Shanghai Youcang Business Consulting Partnership (Limited Partnership), and Li Jia are defendants in a dispute with Zhuji Huarui Wenhua Equity Investment Partnership (Limited Partnership), Zhuji Huarui Torch Venture Capital Investment Partnership (Limited Partnership), and Zhuji Fuhui Industrial Transformation and Upgrading Investment Fund Partnership (Limited Partnership). The plaintiffs are seeking an order for the defendants to jointly pay an investment exit amount of RMB10,000, together with overdue payment penalties calculated based on RMB10,000 at the prevailing one-year loan prime rate from January 1, 2024, to the actual payment date, as well as litigation costs. The parties are currently negotiating a potential out-of-court settlement structured as a debt-to-equity conversion.

Zibo Hengsong You Car Equity Investment Fund Partnership (Limited Partnership) filed a lawsuit against Youpin SD, AHYS, WFOE, and Jia Li. The plaintiff seeks an order requiring the defendants to repurchase a 13.0435% equity interest in Youpin SD and jointly pay the equity repurchase price of RMB240,000, plus interest temporarily calculated at RMB78,220. In response, the defendants filed a counterclaim requesting that Zibo Hengsong transfer all of its equity in Youpin Shandong to AHYS (an entity designated by Li Jia) at the agreed consideration of RMB0.001 and cooperate in completing the equity registration procedures. Both the counterclaim and the application to add a third party have been accepted by the court. The case is scheduled for a hearing on September 26, 2025.

Liaoning Youguan and Youpin are defendants in a dispute with the Dalian Jinpu New Area Administrative Committee. The parties previously entered into a cooperative investment agreement concerning new energy vehicles and related industries, under which the plaintiff agreed to provide financial support funds to the defendants subject to specified conditions. The plaintiff is seeking repayment of the support funds in the amount of RMB9,887, plus interest of RMB1,483. The case was accepted by the Dalian Arbitration Commission on April 30, 2025. The defendants have subsequently filed an application with the Dalian Intermediate People's Court to confirm the validity of the arbitration agreement.

A contingency provision of RMB3,000 (US 419) and nil was accounted as of June 30, 2025 and December 31, 2024. ****

 ****

***Guarantees***

From August 2020 to November 2021, Youguan Financial Leasing provided a total of RMB5,869 (US$827) guarantee to its four customers who entered into two five-year guarantees and two four-year guarantees. As of the date of this report, the balance of the guarantees was RMB2,003(US$274).

Other than as disclosed above, the Group did not have any significant capital and other commitments, long-term obligations, provisions or guarantees as of June 30, 2025.

**22. SUBSEQUENT EVENTS**

The Group evaluated all events that occurred up to the date of this report and determined that there were no events that would have required adjustment or disclosure in the consolidated financial statements, except the following:

SH Youxu and Youxu Nanyang are defendants in a dispute with Shanghai Jiehuan Intelligent Technology Co., Ltd. The parties previously entered into a debt-to-equity swap agreement concerning multiple creditor's rights, under which the defendants were required to complete the equity transfer by May 31, 2025. Due to the procedural timeline required for the transfer, the defendants did not complete it by the deadline, and the plaintiff subsequently filed a claim seeking repayment of the outstanding debt of RMB5,800. The first court hearing was held on August 12, 2025, and no judgment has been rendered as of the date of this report. The parties are currently negotiating a potential out-of-court settlement.

Xiamen Youxu and Youpin Shandong are defendants in a dispute with Yidong New Energy Technology Co., Ltd. The parties entered into a battery lease agreement in July 2022, under which the defendants agreed to lease new energy vehicles provided by the plaintiff. During the performance of the contract, the defendants identified quality issues with the vehicle batteries supplied by the plaintiff. After multiple rounds of unsuccessful negotiations to resolve the issues, the defendants terminated the cooperation. The plaintiff subsequently filed a lawsuit, citing the defendants' failure to pay rent on time. The case was first heard in court on September 11, 2025, and the parties reached a settlement in court. Pursuant to the settlement agreement, the defendants are required to pay outstanding compensation of RMB892 to the plaintiff within the specified period. Upon execution of the settlement agreement, the Company has recognized the related amount in other expenses and other payables in the consolidated financial statements.

Youxu Zibo and Youpin Shandong are defendants in a dispute with Shandong Qiying Industrial Investment and Development Co., Ltd. The parties entered into a contract in 2022, under which the defendants were to lease the plaintiff's factory building and dormitories through an equity transfer arrangement. In 2025, the plaintiff filed a lawsuit seeking payment of RMB7,608 in rent and RMB619 in liquidated damages. The case was heard on September 12, 2025, and no judgment has been rendered as of the date of this report.

 **9,090,909 Units, Each Unit Consisting of One Class A Ordinary Share or One Pre-funded Warrant to** 

**Purchase One Class A Ordinary Share** 

**and One Class A Warrant to Purchase One Class A Ordinary Share** 

 **Up to 9,090,909 Class A Ordinary Shares Underlying the Pre-funded Warrants** 

 **Up to 36,363,636 Class A Ordinary Shares Underlying the Class A Warrants (which includes a zero exercise price option)**

**U Power Limited**

**PRELIMINARY PROSPECTUS**

**, 2026**

***Sole Book-Running Manager***

**Maxim Group LLC**

**PART II**

**Item 6.** **Indemnification of Directors and Officers.** 

Cayman Islands law does not limit the extent to which a company's articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. Our amended and restated articles of association, provide that, to the extent permitted by law, we shall indemnify each existing or former secretary, director (including alternate director), and any of our other officers (including an investment adviser or an administrator or liquidator) and their personal representatives against:

&nbsp;&nbsp;&nbsp;&nbsp;(a) all actions, proceedings, costs, charges, expenses, losses,
damages or liabilities incurred or sustained by the existing or former director (including alternate director), secretary or officer
in or about the conduct of our business or affairs or in the execution or discharge of the existing or former director (including alternate
director), secretary's or officer's duties, powers, authorities or discretions; and

&nbsp;&nbsp;&nbsp;&nbsp;(b) without limitation to paragraph (a) above, all costs,
expenses, losses or liabilities incurred by the existing or former director (including alternate director), secretary or officer in defending
(whether successfully or otherwise) any civil, criminal, administrative or investigative proceedings (whether threatened, pending or
completed) concerning us or our affairs in any court or tribunal, whether in the Cayman Islands or elsewhere.

No such existing or former director (including alternate director), secretary or officer, however, shall be indemnified in respect of any matter arising out of his own dishonesty.

To the extent permitted by law, we may make a payment, or agree to make a payment, whether by way of advance, loan or otherwise, for any legal costs incurred by an existing or former director (including alternate director), secretary or any of our officers in respect of any matter identified in above on condition that the director (including alternate director), secretary or officer must repay the amount paid by us to the extent that it is ultimately found not liable to indemnify the director (including alternate director), the secretary or that officer for those legal costs.

We have entered into indemnification agreements with each of our directors and executive officers. Under these agreements, we have agreed to indemnify our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being such a director or executive officer.

The form of underwriting agreement filed as Exhibit 1.1 to this registration statement will also provide for indemnification of us and our officers and directors.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to 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.

**Item 7.** **Recent Sales of Unregistered Securities.** 

During the past three years, we have issued and sold the securities described below without registering the securities under the Securities Act. We believe that each of the following issuances was exempt from registration under the Securities Act in reliance on Regulation D under the Securities Act or pursuant to Section 4(a)(2) of the Securities Act regarding transactions not involving a public offering or in reliance on Regulation S under the Securities Act regarding sales by an issuer in offshore transactions.

None of these transactions involved any underwriters' underwriting discounts or commissions, or any public offering.

The below share numbers and their respective prices reflect the 1-for-100 reverse share split implemented on March 31, 2024.

On March 1, 2024, we issued 300,000 ordinary shares of the Company, par value US$0.00001 per share to Lingzhi Zeng, to acquire 26.25% equity interests in MATSON (HONG KONG) INDUSTRY CO., LIMITED.

On June 15, 2024, we issued 209,644 ordinary shares of the Company, par value US$0.00001 per share to Fortune Light Assets Ltd., at a purchase price of $4.77 per share, for an aggregate purchase price of $1,000,001.88.

On July 3, 2024, we issued 209,644 ordinary shares of the Company, par value US$0.00001 per share to Fortune Light Assets Ltd., at a purchase price of $4.77 per share, for an aggregate purchase price of $1,000,001.88.

On June 10, 2024, we issued 419,289 ordinary shares of the Company, par value US$0.00001 per share to Big Benefit Ltd., at a purchase price of $4.77 per ordinary share, for an aggregate purchase price of $2,000,008.53.

On January 27, 2025, we issued common warrants to certain institutional investors, to purchase up to 1,562,502 Class A Ordinary Shares, which have an exercise price of $4.80 per Class A Ordinary Share, are exercisable immediately and will expire on January 27, 2030.

On July 25, 2025, we issued common warrants to certain institutional investors, to purchase up to 551,628 Class A Ordinary Shares, which have an exercise price of $2.50 per Class A Ordinary Share, are exercisable immediately and will expire on July 24, 2030.

On December 1, 2025, we issued the 2025 Senior Secured Promissory Notes in the aggregate original principal amount of US$2,517,000 to an institutional investor. The 2025 Senior Secured Promissory Notes were issued with twenty percent (20%) original issue discount, and bear no interest unless an event of default occurs and are due and payable by the Company on the maturity date of March 1, 2026. Any principal or other amounts due under the December 2025 SPA and the 2025 Senior Secured Promissory Notes that are not paid when due (excluding amounts already accruing interest at the default rate established therefor under the Senior Secured Promissory Notes) shall incur a late charge equal to 18% per annum from the due date until fully paid.

**Item 8.** **Exhibits and Financial Statement Schedules.** 

**(a)** The following exhibits are
included in this registration statement on Form F-1:

**Exhibit Index** 

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 1.1\*\* | [Form of Underwriting Agreement](ea028160401ex1-1.htm) |
| 3.1\* | [Third Amended and Restated Articles of Incorporation](http://www.sec.gov/Archives/edgar/data/1939780/000121390026025381/ea028032701ex3-1.htm)  |
| 4.1 | [Specimen Certificate for Class A Ordinary Shares (incorporated by reference to Exhibit 4.1 of our Registration Statement on Form F-3 (File No. 333-282901) filed with the SEC on October 8, 2024)](http://www.sec.gov/Archives/edgar/data/1939780/000121390024086269/ea021544301ex4-1_upower.htm) |
| 4.2\* | [Form of Pre-funded Warrant](http://www.sec.gov/Archives/edgar/data/1939780/000121390026025381/ea028032701ex4-2.htm) |
| 4.3\*\* | [Form of Class A Ordinary Share Purchase Warrant](ea028160401ex4-3.htm) |
| 5.1\*\* | [Opinion of Maples and Calder (Hong Kong) LLP regarding the validity of the Class A Ordinary Shares being registered](ea028160401ex5-1.htm) |
| 5.2\*\* | [Opinion of Hunter Taubman Fischer & Li LLC, U.S. counsel to Company, as to the enforceability of the Class A Warrants and Pre-funded Warrants](ea028160401ex5-2.htm) |
| 10.1 | [Form of Employment Agreement by and between executive officers and the Company (incorporated by reference to Exhibit 10.1 of our Registration Statement on Form F-1 (File No. 333-268949) initially filed with the SEC on December 22, 2022)](http://www.sec.gov/Archives/edgar/data/1939780/000121390022082127/ff12022ex10-1_upower.htm) |
| 10.2 | [Form of Indemnification Agreements between the Company and its directors and officers (incorporated by reference to Exhibit 10.2 of our Registration Statement on Form F-1 (File No. 333-268949) initially filed with the SEC on December 22, 2022)](http://www.sec.gov/Archives/edgar/data/1939780/000121390022082127/ff12022ex10-2_upower.htm) |
| 10.3 | [English translation of cooperation agreement by and between FAW Jiefang Qingdao Automobile Co., Ltd. and Shanghai Youxu New Energy Technology Co., Ltd., dated September 28, 2021 (incorporated by reference to Exhibit 10.3 of our Registration Statement on Form F-1 (File No. 333-268949) initially filed with the SEC on December 22, 2022)](http://www.sec.gov/Archives/edgar/data/1939780/000121390022082127/ff12022ex10-3_upower.htm) |
| 10.4 | [English translation of cooperation agreement by and between Dongfeng Liuzhou Motor Co., Ltd. and Shanghai Youxu New Energy Technology Co., Ltd., dated August 28, 2021 (incorporated by reference to Exhibit 10.4 of our Registration Statement on Form F-1 (File No. 333-268949) initially filed with the SEC on December 22, 2022)](http://www.sec.gov/Archives/edgar/data/1939780/000121390022082127/ff12022ex10-4_upower.htm) |
| 10.5 | [Form of Employment Agreement by and between executive officers and the Company (incorporated by reference to Exhibit 10.1 of our Registration Statement on Form F-1 (File No. 333-268949) initially filed with the SEC on December 22, 2022)](https://www.sec.gov/Archives/edgar/data/1939780/000121390022082127/ff12022ex10-1_upower.htm) |
| 10.6 | [English translation of Capital Increase Agreement dated December 31, 2021 (incorporated by reference to Exhibit 10.6 of our Registration Statement on Form F-1 (File No. 333-268949) initially filed with the SEC on December 22, 2022)](http://www.sec.gov/Archives/edgar/data/1939780/000121390022082127/ff12022ex10-6_upower.htm) |
| 10.7 | [English translation of Amendment, dated November 10, 2023, to Capital Increase Agreement (originally dated December 31, 2021) among Youxu New Energy Technology (Zibo) Co., Ltd., Mr. Jia Li, and Shandong Qiying Industrial Investment Development Co., Ltd. (incorporated by reference to Exhibit 4.15 of the Annual Report on Form 20-F, filed with the SEC on May 15, 2024)](http://www.sec.gov/Archives/edgar/data/1939780/000121390024043715/ea020526501ex4-15_upower.htm) |
| 10.8 | [English translation of Consulting Agreement, between U Power Limited and RICHNESS FORTUNE CREDIT(HK) COMPANY LIMITED, dated April 18, 2023 (incorporated by reference to Exhibit 4.16 of the Annual Report on Form 20-F, filed with the SEC on May 15, 2024)](http://www.sec.gov/Archives/edgar/data/1939780/000121390024043715/ea020526501ex4-16_upower.htm) |

---

---

| | |
|:---|:---|
| 10.9 | [English translation of Offshore Business Loan Entrustment Agreement between U Power Limited and Worthy Credit Limited, dated March 31, 2023 (incorporated by reference to Exhibit 4.17 of the Annual Report on Form 20-F, filed with the SEC on May 15, 2024)](http://www.sec.gov/Archives/edgar/data/1939780/000121390024043715/ea020526501ex4-17_upower.htm) |
| 10.10 | [Service Agreement between U Power Limited and Liberty Asset Management Capital Limited, dated March 31, 2023 (incorporated by reference to Exhibit 4.18 of the Annual Report on Form 20-F, filed with the SEC on May 15, 2024)](http://www.sec.gov/Archives/edgar/data/1939780/000121390024043715/ea020526501ex4-18_upower.htm) |
| 10.11 | [Subscription Agreement between U Power Limited and Fortune Light Assets Ltd., dated May 13, 2024 (incorporated by reference to exhibit 10.1 of our report on Form 6-K (File No. 001-41679) filed on May 20, 2024)](http://www.sec.gov/Archives/edgar/data/1939780/000121390024045179/ea020655601ex10-1_upower.htm) |
| 10.12 | <u>[Subscription Agreement between U Power Limited and Big Benefit Ltd., dated May 23, 2024 (incorporated by reference to exhibit 10.1 of our report on Form 6-K (File No. 001-41679) filed on May 30, 2024)](http://www.sec.gov/Archives/edgar/data/1939780/000121390024047969/ea020710701ex10-1_upower.htm)</u> |
| 10.13 | <u>[Subscription Agreement between U Power Limited and Fortune Light Assets Ltd., dated June 24, 2024 (incorporated by reference to exhibit 10.1 of our report on Form 6-K (File No. 001-41679) filed on June 28, 2024)](http://www.sec.gov/Archives/edgar/data/1939780/000121390024057377/ea020874801ex10-1_upower.htm)</u> |
| 10.14 | <u>[Form of the Securities Purchase Agreement, dated January 24, 2025, by and among the Company and the purchasers (incorporated by reference to Exhibit 10.2 to the Form 6-K (File No. 001-41679) filed by the Company with the SEC on January 28, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025007561/ea022889901ex10-2_upower.htm)</u> |
| 10.15 | <u>[Placement Agency Agreement, dated January 24, 2025, by and between the Company and Maxim Group LLC (incorporated by reference to Exhibit 10.1 to the Form 6-K (File No. 001-41679) filed by the Company with the SEC on January 28, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025007561/ea022889901ex10-1_upower.htm)</u> |
| 10.16\* | [English translation of Sales Contract for Battery-swapping Vehicles, between Shanghai Youxu New Energy Technology Co., Ltd and Treep Mobility Group S.A.C., dated January 16, 2025](http://www.sec.gov/Archives/edgar/data/1939780/000121390026025381/ea028032701ex10-16.htm) |
| 10.17 | [Form of the Securities Purchase Agreement, dated January 24, 2025, by and among the Company and the Selling Shareholders (incorporated by reference to Exhibit 10.2 to the Form 6-K filed by the Company with the SEC on January 28, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025007561/ea022889901ex10-2_upower.htm) |
| 10.18 | [Placement Agency Agreement, dated January 24, 2025, by and between the Company and Maxim Group LLC (incorporated by reference to Exhibit 10.1 to the Form 6-K filed by the Company with the SEC on January 28, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025007561/ea022889901ex10-1_upower.htm) |
| 10.19 | [Joint Venture Agreement, dated December 25, 2024, by and between U SWAP Co., Ltd. and Ezzy Transporter (Thailand) Co., Ltd. (incorporated by reference to Exhibit 4.25 of the Annual Report on Form 20-F, filed with the SEC on May 15, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025044284/ea023947801ex4-25_upower.htm) |
| 10.20 | [Joint Venture Agreement, dated December 16, 2024, by and among Associação Nacional dos Transportes Rodoviários em Automóveis Ligeiros, Energy U Limited and UNEXMOB MOBILIDADE ELETRICA, LDA (incorporated by reference to Exhibit 4.26 of the Annual Report on Form 20-F, filed with the SEC on May 15, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025044284/ea023947801ex4-26_upower.htm) |
| 10.21 | [Placement Agency Agreement, dated July 24, 2025, by and between the Company and Maxim Group LLC (incorporated by reference to Exhibit 10.1 to the Form 6-K filed by the Company with the SEC on July 28, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025068216/ea025029801ex10-1_upower.htm) |
| 10.22 | [Form of Securities Purchase Agreement, dated July 24, 2025, by and between the Company and the Selling Shareholder (incorporated by reference to Exhibit 10.2 to the Form 6-K filed by the Company with the SEC on July 28, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025068216/ea025029801ex10-2_upower.htm) |

---

---

| | |
|:---|:---|
| 10.23\* | [English translation of Battery-swapping Project Engineering Service Agreement, between Shanghai Youxu New Energy Technology Co., Ltd and SAIC MAXUS AUTOMOBILE CO., LTD., dated September 23, 2025](http://www.sec.gov/Archives/edgar/data/1939780/000121390026025381/ea028032701ex10-23.htm) |
| 10.24\* | [English translation of Cooperation Agreement, among U Power Limited, UNEX MOBIITY Limited and SAIC Hongyan Automobile Co., Ltd., dated November 20, 2025](http://www.sec.gov/Archives/edgar/data/1939780/000121390026025381/ea028032701ex10-24.htm) |
| 10.25 | [Form of Securities Purchase Agreement (Incorporated by reference to Exhibit 10.1 to the Registrant's Report on Form 6-K filed to the Securities and Exchange Commission on December 3, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025117850/ea026828301ex10-1_upower.htm) |
| 10.26 | [Form of Senior Secured Promissory Note (Incorporated by reference to Exhibit 10.2 to the Registrant's Report on Form 6-K filed to the Securities and Exchange Commission on December 3, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025117850/ea026828301ex10-2_upower.htm) |
| 10.27 | [Form of Pledge Agreement (Incorporated by reference to Exhibit 10.3 to the Registrant's Report on Form 6-K filed to the Securities and Exchange Commission on December 3, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025117850/ea026828301ex10-3_upower.htm) |
| 10.28 | [Form of Equity Interest Control Agreement (Incorporated by reference to Exhibit 10.4 to the Registrant's Report on Form 6-K filed to the Securities and Exchange Commission on December 3, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025117850/ea026828301ex10-4_upower.htm) |
| 10.29 | [Placement Agency Agreement, dated December 1, 2025, by and between the Company and Maxim Group LLC (Incorporated by reference to Exhibit 10.5 to the Registrant's Report on Form 6-K filed to the Securities and Exchange Commission on December 3, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025117850/ea026828301ex10-5_upower.htm) |
| 14.1 | [Code of Business Conduct and Ethics of the Registrant (incorporated by reference to Exhibit 14.1 of our Registration Statement on Form F-1 (File No. 333-268949) initially filed with the Securities and Exchange Commission on December 22, 2022)](http://www.sec.gov/Archives/edgar/data/1939780/000121390022082127/ff12022ex14-1_upower.htm) |
| 21.1 | [Subsidiaries of the Registrant (incorporated by reference to Exhibit 8.1 of the Registration Statement on Form 20-F previously filed with the SEC by U Power Limited on May 15, 2025)](http://www.sec.gov/Archives/edgar/data/1939780/000121390025044284/ea023947801ex8-1_upower.htm) |
| 23.1\* | [Consent of Onestop Assurance PAC](http://www.sec.gov/Archives/edgar/data/1939780/000121390026025381/ea028032701ex23-1.htm) |
| 23.2\*\* | [Consent of Maples and Calder (Hong Kong) LLP (included in Exhibit 5.1)](ea028160401ex5-1.htm) |
| 23.3\*\* | [Consent of Hunter Taubman Fischer & Li LLC (included in Exhibit 5.2)](ea028160401ex5-2.htm) |
| 23.4\* | [Consent of Guantao Law Firm](http://www.sec.gov/Archives/edgar/data/1939780/000121390026025381/ea028032701ex23-4.htm) |
| 24.1\* | [Powers of Attorney (included on the signature page)](http://www.sec.gov/ix?doc=/Archives/edgar/data/1939780/000121390026025381/ea0280327-f1_upower.htm#POA) |
| 107\* | [Filing Fee Table](http://www.sec.gov/Archives/edgar/data/1939780/000121390026025381/ea028032701ex-fee.htm) |

---

\* Previously filed.

\*\* Filed herewith.

**Item 9.** **Undertakings** 

The undersigned registrant hereby undertakes:

(1) To file, during any period
in which offers or sales are being made, a post-effective amendment to this registration statement:

&nbsp;&nbsp;&nbsp;&nbsp;(i) To include any prospectus required
by section 10(a)(3) of the Securities Act of 1933;

&nbsp;&nbsp;&nbsp;&nbsp;(ii) To reflect in the prospectus
any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding
the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed
that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent
no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table
in the effective registration statement; and

&nbsp;&nbsp;&nbsp;&nbsp;(iii) To include any material information
with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information
in the registration statement.

(2) That, for the purposes of determining
any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide
offering thereof.

(3) To remove from registration
by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4) To file a post-effective amendment
to the registration statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering
or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Securities Act
of 1933 need not be furnished, provided that the registrant includes in the prospectus, by means of a post-effective amendment, financial
statements required pursuant to this paragraph (4) and other information necessary to ensure that all other information in the prospectus
is at least as current as the date of those financial statements.

(5) That, for the purpose of determining
liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned
registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement,
regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser
by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered
to offer or sell such securities to such purchaser:

&nbsp;&nbsp;&nbsp;&nbsp;(i) Any preliminary prospectus
or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

&nbsp;&nbsp;&nbsp;&nbsp;(ii) Any free writing prospectus
relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

&nbsp;&nbsp;&nbsp;&nbsp;(iii) The portion of any other free
writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided
by or on behalf of the undersigned registrant; and

&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any other communication that
is an offer in the offering made by the undersigned registrant to the purchaser.

(6) That, for purposes of determining
any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration
statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b) (1) or (4)
or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

(7) Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed
by the final adjudication of such issue.

**SIGNATURES**

Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Shanghai, People's Republic of China, on March 13, 2026.

---

| | |
|:---|:---|
| **U Power Limited** | **U Power Limited** |
| By: | */s/ Jia Li* |
| Name: | Jia Li |
| Title: | Chief Executive Officer and<br> Chairman of the Board of Directors |

---

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

---

| | | |
|:---|:---|:---|
| **Signature** | **Title** | **Date** |
| */s/ Jia Li* | Chief Executive Officer, Director, and Chairman of the Board of Directors | March 13, 2026 |
| Name: Jia Li | (Principal Executive Officer) |  |
| \* | Chief Financial Officer and Officer | March 13, 2026 |
| Name: Bingyi Zhao | (Principal Financial and Accounting Officer) |  |
| \* | Independent Director | March 13, 2026 |
| Name: Xiaochun Li | (Director) |  |
| \* | Independent Director | March 13, 2026 |
| Name: Quanshi Chen | (Director) |  |
| \* | Independent Director | March 13, 2026 |
| Name: Jean Christophe von Pfetten | (Director) |  |

---

---

| | |
|:---|:---|
| By: | */s/ Jia Li* |
|  | Jia Li |
|  | Attorney-in-fact\* |

---

**AUTHORIZED REPRESENTATIVE**

Pursuant to the requirements of the Securities Act of 1933, as amended, the undersigned, the duly authorized representative of the Registrant in the United States, has signed this registration statement in New York, NY on March 13, 2026.

---

| | |
|:---|:---|
| **Cogency Global Inc.** | **Cogency Global Inc.** |
| Authorized U.S. Representative | Authorized U.S. Representative |
| By: | */s/ Colleen A. De Vries* |
| Name: | Colleen A. De Vries |
| Title: | Sr. Vice President on behalf of <br> Cogency Global Inc. |

---

## Exhibit 1.1

**Exhibit 1.1**

**______ ORDINARY SHARES, _______ PRE-FUNDED WARRANTS and** 

**________ CLASS A Warrants of**

**U POWER LIMITED** 

**UNDERWRITING AGREEMENT**

February __, 2026

Maxim Group LLC

As the Representative of the Several underwriters, if any, named in <u>Schedule I</u> hereto

c/o Maxim Group LLC

300 Park Avenue, 16<sup>th</sup> Floor

New York, NY 10022

Ladies and Gentlemen:

The undersigned, U Power Limited, a Cayman Islands exempted company (collectively with its subsidiaries and affiliates, including, without limitation, all entities disclosed or described in the Registration Statement (as defined below) as being subsidiaries or affiliates of U Power Limited, the "<u>Company</u>"), hereby confirms its agreement (this "<u>Agreement</u>") with the several underwriters (such underwriters, including the Representative (as defined below), the "<u>Underwriters</u>" and each an "<u>Underwriter</u>") named in <u>Schedule I</u> hereto for which Maxim Group LLC is acting as representative to the several Underwriters (the "<u>Representative</u>" and if there are no Underwriters other than the Representative, references to multiple Underwriters shall be disregarded and the term Representative as used herein shall have the same meaning as Underwriter) on the terms and conditions set forth herein.

It is understood that the several Underwriters are to make a public offering of the Public Securities (as defined below) as soon as the Representative deems it advisable to do so. The Public Securities are to be initially offered to the public at the public offering price set forth in the Prospectus (as defined below). The Representative may from time to time thereafter change the public offering price and other selling terms.

It is further understood that you will act as the Representative for the Underwriters in the offering and sale of the Closing Securities (as defined below) and, if any, the Option Securities (as defined below) in accordance with this Agreement.

**ARTICLE I.**

**DEFINITIONS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 <u>Definitions</u>. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings set forth in this Section 1.1:

"<u>Action</u>" shall have the meaning ascribed to such term in Section 3.1(k).

"<u>Affiliate</u>" means with respect to any Person (as defined below), any other Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with such Person as such terms are used in and construed under Rule 405 under the Securities Act (as defined below).

"<u>Applicable Laws</u>" means all United States (federal, state and local) and foreign statutes, rules, regulations, codes, treaties, or guidance applicable to the Company or the Subsidiaries (as defined below).

"<u>Board of Directors</u>" means the board of directors of the Company.

"<u>Business Day</u>" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; <u>provided</u>, <u>however</u>, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to "stay at home", "shelter-in-place", "non-essential employee" or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.

"<u>Cayman Counsel</u>" means Maples and Calder (Hong Kong) LLP, with offices located at 26<sup>th</sup> Floor, Central Plaza, 18 Harbour Road, Wanchai, Hong Kong.

"<u>Class A Warrants</u>" means, collectively, the Class A Warrants delivered to the Underwriters in accordance with Section 2.1(a)(iii) and Section 2.2, which Class A Warrants shall be exercisable immediately upon issuance and have a term of exercise equal to one (1) year from the initial exercise date, in the form of <u>Exhibit C</u> attached hereto.

"<u>Class A Warrant Shares</u>" means the Ordinary Shares (as defined below) issuable upon exercise of the Class A Warrants.

"<u>Closing</u>" means the closing of the purchase and sale of the Closing Securities pursuant to Section 2.1.

"<u>Closing Date</u>" means the hour and the date on the Trading Day on which all conditions precedent to (i) the Underwriters' obligations to pay the Closing Purchase Price (as defined below) and (ii) the Company's obligations to deliver the Closing Securities, in each case, have been satisfied or waived, but in no event later than 10:00 a.m. (New York City time) on the first (1st) Trading Day following the date hereof (or the second (2<sup>nd</sup>) Trading Day following the date hereof if this Agreement is signed on a day that is not a Trading Day or after 4:00 p.m. (New York City time) and before midnight (New York City time) on a Trading Day) or at such earlier time as shall be agreed upon by the Representative and the Company.

"<u>Closing Purchase Price</u>" shall have the meaning ascribed to such term in Section 2.1(b), which aggregate purchase price shall be net of the underwriting discounts and commissions.

"<u>Closing Securities</u>" shall have the meaning ascribed to such term in Section 2.1(a)(iii).

"<u>Closing Shares</u>" shall have the meaning ascribed to such term in Section 2.1(a)(i).

"<u>Closing Warrants</u>" shall have the meaning ascribed to such term in Section 2.1(a)(iii).

"<u>Combined Purchase Price</u>" shall have the meaning ascribed to such term in Section 2.1(b).

"<u>Commission</u>" means the United States Securities and Exchange Commission.

"<u>Company Auditor</u>" means Onestop Assurance PAC, with offices located at 10 Anson Road #21-14 International Plaza, Singapore.

"<u>Company Counsel</u>" means Hunter Taubman Fischer & Li LLC, with offices located at 950 Third Avenue, 19<sup>th</sup> Floor, New York, NY 10022.

"Disclosure Schedules" means the Disclosure Schedules of the Company delivered concurrently herewith.

"<u>Effective Date</u>" shall have the meaning ascribed to such term in Section 3.1(f).

"<u>EGS</u>" means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105.

"<u>Exchange Act</u>" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

"<u>Execution Date</u>" shall mean the date on which the parties execute and enter into this Agreement.

"<u>Exempt Issuance</u>" means the issuance of (a) Ordinary Shares (as defined below) or options to employees, officers, directors, or advisors of the Company pursuant to any share or option plan duly adopted for such purpose by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose for services rendered to the Company, (b) securities issued upon the exercise or exchange of or conversion of any securities issued hereunder and/or other securities exercisable or exchangeable for or convertible into Ordinary Shares issued and outstanding on the date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with automatic price resets or anti-dilution provisions, stock splits, adjustments or combinations as set forth in such securities as of the date of this Agreement) or to extend the term of such securities and (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that such securities are issued as "restricted securities" (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith during the prohibition period in Section 4.21(a) herein, and provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities

"<u>FCPA</u>" means the Foreign Corrupt Practices Act of 1977, as amended.

"<u>FINRA</u>" means the Financial Industry Regulatory Authority.

"<u>GAAP</u>" shall have the meaning ascribed to such term in Section 3.1(i).

"<u>Governmental Authority</u>" means any federal, provincial, state, local, foreign or other governmental, quasi-governmental or administrative agency, court or body or any other type of regulatory authority or body, including, without limitation, the Nasdaq Capital Market.

"<u>Indebtedness</u>" shall have the meaning ascribed to such term in Section 3.1(bb).

"<u>Liens</u>" means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction.

"<u>Lock-Up Agreement</u>" means the lock-up agreements that are executed on the date hereof by each of the Lock-Up Parties, in the form of <u>Exhibit A</u> attached hereto.

"<u>Lock-Up Parties</u>" means (i) the Company's officers and directors and (ii) any 5% and greater stockholders of the Company as of the date of this Agreement.

"<u>Material Adverse Effect</u>" shall have the meaning assigned to such term in Section 3.1(b).

"<u>Offering</u>" shall have the meaning ascribed to such term in Section 2.1(c).

"<u>Option</u>" shall have the meaning ascribed to such term in Section 2.2.

"<u>Option Closing Date</u>" shall have the meaning ascribed to such term in Section 2.2(c).

"<u>Option Closing Purchase Price</u>" shall have the meaning ascribed to such term in Section 2.2(b), which aggregate purchase price shall be net of the underwriting discounts and commissions.

"<u>Option Securities</u>" shall have the meaning ascribed to such term in Section 2.2(a).

"<u>Option Shares</u>" shall have the meaning ascribed to such term in Section 2.2(a)(i).

"<u>Option Warrants</u>" shall have the meaning ascribed to such term in Section 2.2(a)(ii).

"<u>Ordinary Shares</u>" means the Class A ordinary shares of the Company, par value $0.00001 per share, and any other class of securities into which such securities may hereafter be reclassified or changed.

"<u>Ordinary Share Equivalents</u>" means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Ordinary Shares, including, without limitation, any debt, preferred shares, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Ordinary Shares.

"<u>Person</u>" means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

"<u>PRC Counsel</u>" means Guantao Law Firm, with offices located at 19/F, Tower B, Xinsheng Plaza, No. 5 Financial Street, Xicheng District, Beijing 100032, China.

"<u>Pre-Funded Warrants</u>" means, collectively, the pre-funded Ordinary Share purchase warrants delivered to the Underwriters in accordance with Section 2.1(a)(ii), which Pre-Funded Warrants shall be exercisable immediately and shall be exercisable until exercised in full, in the form of <u>Exhibit B</u> attached hereto.

"<u>Pre-Funded Warrant Shares</u>" means the Ordinary Shares issuable upon exercise of the Pre-Funded Warrants.

"<u>Preliminary Prospectus</u>" means any preliminary prospectus relating to the Securities included in the Registration Statement or filed with the Commission pursuant to Rule 424(b).

"<u>Pricing Prospectus</u>" means (i) the Preliminary Prospectus relating to the Securities that was included in the Registration Statement immediately prior to [_:00 p.m.] (New York City time) on the date hereof and (ii) any free writing prospectus (as defined in the Securities Act), taken together.

"<u>Proceeding</u>" means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

"<u>Prospectus</u>" means the final prospectus filed for the Registration Statement.

"<u>Prospectus Supplement</u>" means, if any, any supplement to the Prospectus complying with Rule 424(b) of the Securities Act that is filed with the Commission.

"<u>Public Securities</u>" means, collectively, the Closing Securities and, if any, the Option Securities.

"<u>Registration Statement</u>" means, collectively, the various parts of the registration statement prepared by the Company on Form F-1 (File No. 333-______) with respect to the Securities, each as amended as of the date hereof, including the Prospectus and Prospectus Supplement, if any, the Preliminary Prospectus, if any, and all exhibits filed with or incorporated by reference into such registration statement, and includes any Rule 462(b) Registration Statement.

"<u>Required Approvals</u>" shall have the meaning ascribed to such term in Section 3.1(e).

"<u>Rule 424</u>" means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

"<u>Rule 462(b) Registration Statement</u>" means any registration statement prepared by the Company registering additional Public Securities, which was filed with the Commission on or prior to the date hereof and became automatically effective pursuant to Rule 462(b) promulgated by the Commission pursuant to the Securities Act.

"<u>SEC Reports</u>" shall have the meaning ascribed to such term in Section 3.1(i).

"<u>Securities</u>" means the Closing Securities, the Option Securities and the Warrant Shares.

"<u>Securities Act</u>" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

"<u>Share Purchase Price</u>" shall have the meaning ascribed to such term in Section 2.1(b).

"<u>Shares</u>" means, collectively, the Ordinary Shares delivered to the Underwriters in accordance with Section 2.1(a)(i) and Section 2.2(a).

"<u>Subsidiary</u>" means any subsidiary of the Company and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

"<u>Trading Day</u>" means a day on which the principal Trading Market is open for trading.

"<u>Trading Market</u>" means any of the following markets or exchanges on which the Ordinary Shares are listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, OTCQX or OTCQB (or any successors to any of the foregoing).

"<u>Transaction Documents</u>" means this Agreement and all exhibit and schedules hereto, the Warrants, the Lock-Up Agreements, and any other documents or agreements executed in connection with the transactions contemplated hereunder.

"<u>Transfer Agent</u>" means Transhare Corporation, with offices located at Bayside Center 1, 17755 North U.S. Highway 19, Suite #140, Clearwater, FL 33764, and any successor transfer agent of the Company.

"<u>Warrant Purchase Price</u>" shall have the meaning ascribed to such term in Section 2.1(b).

"<u>Warrant Shares</u>" means the Ordinary Shares issuable upon exercise of the Warrants.

"<u>Warrants</u>" means, collectively, the Class A Warrants and Pre-Funded Warrants.

**ARTICLE II.**

**PURCHASE AND SALE**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Closing</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Upon the terms and subject to the conditions set forth herein, the Company agrees to sell in the aggregate _______ Ordinary Shares, Pre-Funded Warrants exercisable for an aggregate of _______ Ordinary Shares and Class A Warrants exercisable for an aggregate of _______ Ordinary Shares, and each Underwriter agrees to purchase, severally and not jointly, at the Closing, the following securities of the Company:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the number of Ordinary Shares (the "<u>Closing Shares</u>") set forth opposite the name of such Underwriter on <u>Schedule I</u> hereof; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Pre-Funded Warrants to purchase up to the number of Ordinary Shares set forth opposite the name of such Underwriter on <u>Schedule I</u> hereof (the "<u>Pre-Funded Warrants</u>") which Pre-Funded Warrants shall have an exercise price of $0.001, subject to adjustment as provided therein;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Class A Warrants to purchase up to the number of Ordinary Shares set forth opposite the name of such Underwriter on <u>Schedule I</u> hereof (the "<u>Closing Warrants</u>" and, collectively with the Closing Shares and Pre-Funded Warrants, the "<u>Closing Securities</u>"), which Class A Warrants shall have an exercise price of $____, subject to adjustment as provided therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The aggregate purchase price for the Closing Securities shall equal the amount set forth opposite the name of such Underwriter on <u>Schedule I</u> hereto (the "<u>Closing Purchase Price</u>"). The combined purchase price for one Share and one Class A Warrant to purchase one Class A Warrant Share shall be $_______ (the "<u>Combined Purchase Price</u>") which shall be allocated as $______ per Share (the "<u>Share Purchase Price</u>") and $______ per Class A Warrant (the "<u>Warrant Purchase Price</u>"). The combined purchase price for one Pre-Funded Warrant and one Class A Warrant shall be $____, which shall be allocated as $_____ per Pre-Funded Warrant and $______ per Class A Warrant; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) On the Closing Date, each Underwriter shall deliver or cause to be delivered to the Company, via wire transfer, immediately available funds equal to such Underwriter's Closing Purchase Price and the Company shall deliver to, or as directed by, such Underwriter its respective Closing Securities and the Company shall deliver the other items required pursuant to Section 2.3 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.3 and 2.4, the Closing shall occur at the offices of EGS or such other location as the Company and Representative shall mutually agree. The Public Securities are to be offered initially to the public at the offering price set forth on the cover page of the Prospectus (the "<u>Offering</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Company acknowledges and agrees that, with respect to any Notice(s) of Exercise (as defined in the Pre-Funded Warrants) delivered by a Holder (as defined in the Pre-Funded Warrants) on or prior to 12:00 p.m. (New York City time) on the Closing Date, which Notice(s) of Exercise may be delivered at any time after the time of execution of this Agreement, the Company shall deliver the Pre-Funded Warrant Shares subject to such notice(s) to the Holder by 4:00 p.m. (New York City time) on the Closing Date and the Closing Date shall be the Warrant Share Delivery Date (as defined in the Pre-Funded Warrants). The Company acknowledges and agrees that the Holders are third-party beneficiaries of this covenant of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <u>Option to Purchase Additional Securities</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For the purposes of covering any over-allotments in connection with the distribution and sale of the Closing Securities, the Representative is hereby granted an option (the "<u>Option</u>") to purchase, in the aggregate, up to _______ Ordinary Shares (the "<u>Option Shares</u>") and Class A Warrants to purchase up to _______ Ordinary Shares (the "<u>Option Warrants</u>" and, collectively with the Option Shares, the "<u>Option Securities</u>") which may be purchased in any combination of Option Shares and/or Option Warrants at the Share Purchase Price and/or Warrant Purchase Price, respectively.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In connection with an exercise of the Option, (a) the purchase price to be paid for the Option Shares is equal to the product of the Share Purchase Price multiplied by the number of Option Shares to be purchased and (b) the purchase price to be paid for the Option Warrants is equal to the product of the Warrant Purchase Price multiplied by the number of Option Warrants to be purchased (the aggregate purchase price to be paid on an Option Closing Date, the "<u>Option Closing Purchase Price</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Option granted pursuant to this Section 2.2 may be exercised by the Representative as to all (at any time) or any part (from time to time) of the Option Securities within 45 days after the Execution Date. An Underwriter will not be under any obligation to purchase any Option Securities prior to the exercise of the Option by the Representative. The Option granted hereby may be exercised by the giving of oral notice to the Company from the Representative, which must be confirmed in writing by overnight mail or electronic transmission setting forth the number of Option Shares and/or Option Warrants to be purchased and the date and time for delivery of and payment for the Option Securities (each, an "<u>Option Closing Date</u>"), which will not be later than one (1) full Business Day after the date of the notice or such other time as shall be agreed upon by the Company and the Representative, at the offices of EGS or at such other place (including remotely by other electronic transmission) as shall be agreed upon by the Company and the Representative. If such delivery and payment for the Option Securities does not occur on the Closing Date, each Option Closing Date will be as set forth in the notice. Upon exercise of the Option, the Company will become obligated to convey to the Underwriters, and, subject to the terms and conditions set forth herein, the Underwriters will become obligated to purchase, the number of Option Shares and/or Option Warrants specified in such notice. The Representative may cancel the Option at any time prior to the expiration of the Option by written notice to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 <u>Deliveries</u>. The Company shall deliver or cause to be delivered to each Underwriter (if applicable) the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) At the Closing Date, the Closing Shares and, as to each Option Closing Date, if any, the applicable Option Shares, which shares shall be delivered via The Depository Trust Company Deposit or Withdrawal at Custodian system for the accounts of the several Underwriters;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) At the Closing Date, the Pre-Funded Warrants in certificated form registered in the name or names and in such authorized denominations as the applicable Underwriter may request in writing at least one (1) Business Day prior to the Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) At the Closing Date, the Closing Warrants and, as to each Option Closing Date, if any, the applicable Option Warrants in certificated form registered in the name or names and in such authorized denominations as the applicable Underwriter may request in writing at least one (1) Business Day prior to the Closing Date and, if any, each Option Closing Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) At the Closing Date, a (i) legal opinion of Company Counsel addressed to the Underwriters, including, without limitation, a negative assurance letter, in form and substance satisfactory to the Representative and as to each Option Closing Date, if any, a bring-down opinion from Company Counsel, including, without limitation, a negative assurance letter of Company Counsel, addressed to the Underwriters and in form and substance satisfactory to the Representative, (ii) legal opinion of Cayman Counsel addressed to the Underwriters, in form and substance satisfactory to the Representative and as to each Option Closing Date, if any, a bring-down opinion from Cayman Counsel, addressed to the Underwriters and in form and substance satisfactory to the Representative, and (iii) legal opinion of PRC Counsel addressed to the Underwriters, in form and substance satisfactory to the Representative and as to each Option Closing Date, if any, a bring-down opinion from PRC Counsel, addressed to the Underwriters and in form and substance satisfactory to the Representative;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Contemporaneously herewith, a cold comfort letter, addressed to the Underwriters and in form and substance satisfactory in all respects to the Representative from the Company Auditor dated, respectively, as of the date of this Agreement and a bring-down letter dated as of the Closing Date and each Option Closing Date, if any;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) On the Closing Date and on each Option Closing Date, the duly executed and delivered Officer's Certificate, substantially in the form required by <u>Exhibit D</u> attached hereto;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) On the Closing Date and on each Option Closing Date, the duly executed and delivered Secretary's Certificate, substantially in the form required by <u>Exhibit E</u> attached hereto; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) Contemporaneously herewith, the duly executed and delivered Lock-Up Agreements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 <u>Closing Conditions</u>. The respective obligations of each Underwriter hereunder in connection with the Closing and each Option Closing Date are subject to the following conditions being met:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the accuracy in all material respects when made and on the date in question (other than representations and warranties of the Company already qualified by materiality, which shall be true and correct in all respects) of the representations and warranties of the Company contained herein (unless as of a specific date therein);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) all obligations, covenants, and agreements of the Company required to be performed at or prior to the date in question shall have been performed;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the delivery by the Company of the items set forth in Section 2.3 of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the Registration Statement shall be effective on the date of this Agreement and at each of the Closing Date and each Option Closing Date, if any, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or shall be pending or contemplated by the Commission and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of the Representative;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) by the Execution Date, if required by FINRA, the Underwriters shall have received clearance from FINRA as to the amount of compensation allowable or payable to the Underwriters as described in the Registration Statement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the Closing Shares, the Option Shares and the Warrant Shares have been approved for listing on the Trading Market; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) prior to and on each of the Closing Date and each Option Closing Date, if any: (i) there shall have been no material adverse change or development involving a prospective material adverse change in the condition or prospects or the business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement, the Pricing Prospectus and Prospectus; (ii) no action suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Affiliate of the Company before or by any court or federal or state commission, board or other administrative agency wherein an unfavorable decision, ruling or finding may materially adversely affect the business, operations, prospects or financial condition or income of the Company, except as set forth in the Registration Statement, Pricing Prospectus and Prospectus; (iii) no stop order shall have been issued under the Securities Act and no proceedings therefor shall have been initiated or threatened by the Commission; and (iv) the Registration Statement and the Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Securities Act and the rules and regulations thereunder and shall conform in all material respects to the requirements of the Securities Act and the rules and regulations thereunder, and none of the Registration Statement, Pricing Prospectus, the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

**ARTICLE III.**

**REPRESENTATIONS AND WARRANTIES**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <u>Representations and Warranties of the Company</u>. Except as set forth in the Disclosure Schedules, which Disclosure Schedules shall be deemed a part hereof and shall qualify any representation made herein to the extent of the disclosure contained in the corresponding section of the Disclosure Schedules, the Company represents and warrants to the Underwriters as of the Execution Date, as of the Closing Date and as of each Option Closing Date, if any, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Subsidiaries</u>. All of the direct and indirect Subsidiaries of the Company are set forth in the Registration Statement and Prospectus. The Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Organization and Qualification</u>. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, would not reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company's ability to perform in any material respect on a timely basis its obligations under any Transaction Document (any of (i), (ii) or (iii), a "<u>Material Adverse Effect</u>") and no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Authorization; Enforcement</u>. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and each of the other Transaction Documents to which the Company is a party and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, the Board of Directors or the Company's shareholders in connection herewith or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction Document to which the Company is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors' rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by Applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>No Conflicts</u>. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party, the issuance and sale of the Securities and the consummation by it of the transactions contemplated hereby and thereby do not and will not (i) conflict with or violate any provision of the Company's or any Subsidiary's certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution or similar adjustments, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation of any Applicable Law or other restriction of any court or Governmental Authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as would not reasonably be expected to result in a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Filings, Consents and Approvals</u>. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filings required pursuant to this Agreement; (ii) the filing with the Commission of the Prospectus, (iii) notification(s) to each applicable Trading Market for the listing of the Shares and Warrant Shares for trading thereon, and (iv) such filings as are required to be made under applicable state securities laws (collectively, the "<u>Required Approvals</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Registration Statement</u>. The Company has filed with the Commission the Registration Statement, including any related Prospectus or Prospectuses, for the registration of the Securities under the Securities Act, which Registration Statement has been prepared by the Company in all material respects in conformity with the requirements of the Securities Act and the rules and regulations of the Commission under the Securities Act. The Registration Statement became effective in accordance with Section 8(a) of the Securities Act on _______, 2026 (the "<u>Effective Date</u>"). The Company was at the time of the filing of the Registration Statement eligible to use Form F-1 and is eligible to use Form F-1 on the date hereof and on the Closing Date. The Company has advised the Representative of all further information (financial and other) with respect to the Company required to be set forth therein in the Registration Statement and Prospectus. Any reference in this Agreement to the Registration Statement, the Preliminary Prospectus, the Prospectus or any Prospectus Supplement shall be deemed to refer to and include the documents incorporated by reference therein; and any reference in this Agreement to the terms "amend," "amendment" or "supplement" with respect to the Registration Statement, the Preliminary Prospectus, the Prospectus or any Prospectus Supplement shall be deemed to refer to and include the filing of any document under the Exchange Act after the date of this Agreement, or the issue date of the Prospectus as the case may be, deemed to be incorporated therein by reference. All references in this Agreement to financial statements and schedules and other information which is "contained," "included," "described," "referenced," "set forth" or "stated" in the Registration Statement, the Preliminary Prospectus, the Prospectus or any Prospectus Supplement (and all other references of like import) shall be deemed to mean and include all such financial statements and schedules and other information which is or is deemed to be incorporated by reference in the Registration Statement, the Preliminary Prospectus or the Prospectus, as the case may be. No stop order suspending the effectiveness of the Registration Statement or the use of the Prospectus has been issued, and no proceeding for any such purpose is pending or has been initiated or, to the Company's knowledge, is threatened by the Commission. For purposes of this Agreement, "<u>free writing prospectus</u>" has the meaning set forth in Rule 405 under the Securities Act. The Company will not, without the prior consent of the Representative, prepare, use or refer to, any free writing prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Issuance of Securities</u>. The Securities are duly authorized and, when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Warrant Shares, when issued in accordance with the terms of the Warrants, will be validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized capital stock the maximum number of Ordinary Shares issuable pursuant to this Agreement and the Warrants. No holder of the Securities will be subject to personal liability solely by reason of being such a holder. The Securities are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. All corporate action required to be taken for the authorization, issuance and sale of the Securities has been duly and validly taken. The Securities conform in all material respects to all statements with respect thereto contained in the Registration Statement, the Pricing Prospectus and the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Capitalization</u>. The capitalization of the Company as of the date hereof is as set forth on <u>Schedule 3.1(h)</u>, which <u>Schedule 3.1(h)</u> shall also include the number of Ordinary Shares owned beneficially, and of record, by Affiliates of the Company as of the date hereof. The Company has not issued any capital stock since its most recently filed registration statement under the Exchange Act. No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as a result of the purchase and sale of the Securities and as set forth on <u>Schedule 3.1(h)</u>, there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, any Ordinary Shares or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional Ordinary Shares or Ordinary Share Equivalents or capital stock of any Subsidiary. The issuance and sale of the Securities will not obligate the Company or any Subsidiary to issue Ordinary Shares or other securities to any Person. Except as set forth on Schedule 3.1(h), there are no outstanding securities or instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or instrument upon an issuance of securities by the Company or any Subsidiary. Except as set forth on Schedule 3.1(h), there are no outstanding securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary. The Company does not have any share appreciation rights or "phantom share" plans or agreements or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. The authorized shares of the Company conform in all material respects to all statements relating thereto contained in the Registration Statement, the Pricing Prospectus and the Prospectus. The offers and sales of the Company's securities were at all relevant times either registered under the Securities Act and the applicable state securities or Blue Sky laws or, based in part on the representations and warranties of the purchasers, exempt from such registration requirements. There are no shareholders agreements, voting agreements or other similar agreements with respect to the Company's capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company's shareholders. No further approval or authorization of any stockholder, the Board of Directors, or others is required for the issuance and sale of the Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>SEC Reports; Financial Statements</u>. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, together with the Registration Statement, Pricing Prospectus and the Prospectus, being collectively referred to herein as the "<u>SEC Reports</u>") on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The financial statements of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved ("<u>GAAP</u>"), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments. The agreements and documents described in the SEC Reports, the Registration Statement, the Pricing Prospectus and the Prospectus conform in all material respects to the descriptions thereof contained therein and there are no agreements or other documents required by the Securities Act or the rules and regulations thereunder to be described in the SEC Reports, Registration Statement, the Pricing Prospectus and the Prospectus or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by which it is or may be bound or affected and (i) that is referred to in the SEC Reports, Registration Statement, the Pricing Prospectus and the Prospectus, or (ii) is material to the Company's business, has been duly authorized and validly executed by the Company, is in full force and effect in all material respects and is enforceable against the Company and, to the Company's knowledge, the other parties thereto, in accordance with its terms, except (w) such agreements and other instruments that have terminated or expired in accordance with their terms, (x) as such enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium or similar laws affecting creditors' rights generally, (y) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefore may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the Company's knowledge, any other party is in default thereunder and, to the Company's knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder, except, in each case, for such default that would not reasonably be expected to result in a Material Adverse Effect. To the Company's knowledge, performance by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing Applicable Law or order or decree of any Governmental Authority or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation, those relating to environmental laws and regulations, except, in each case, for such violation that would not reasonably be expected to result in a Material Adverse Effect..

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Material Changes; Undisclosed Events, Liabilities or Developments</u>. Since the date of the latest audited financial statements included within the SEC Reports, except as specifically disclosed in a subsequent filing with the Commission, (i) there has been no event, occurrence or development that has had or that would reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company's financial statements pursuant to GAAP or disclosed in filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its shareholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock, (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to any existing Company share option plans and (vi) no officer or director of the Company has resigned from any position with the Company. The Company does not have pending before the Commission any request for confidential treatment of information. Except for the issuance of the Securities contemplated by this Agreement, no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed at least one (1) Trading Day prior to the date that this representation is made. Unless otherwise disclosed in an SEC Report filed prior to the date hereof, the Company has not: (i) issued any securities or incurred any liability or obligation, directly or indirectly, for borrowed money, or (ii) declared or paid any dividend or made any other distribution on or in respect to its capital stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) <u>Litigation</u>. There is no action, suit, inquiry, notice of violation, proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, Governmental Authority (federal, state, county, local or foreign) (collectively, an "<u>Action</u>") which (i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Securities or (ii) would, if there were an unfavorable decision, reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor, to the Company's knowledge, any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) <u>Labor Relations</u>. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company, which would reasonably be expected to result in a Material Adverse Effect. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing matters that would reasonably be expected to have a Material Adverse Effect. The Company and its Subsidiaries are in compliance with all Applicable Laws relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company and each of the Subsidiaries (A) are in compliance, in all material respects, with all Applicable Laws (including pursuant to the Occupational Health and Safety Act or its foreign equivalents) relating to the protection of human health and safety in the workplace ("<u>Occupational Laws</u>"); (B) have received all required permits, licenses or other approvals required of it under applicable Occupational Laws to conduct its business as currently conducted, except where the failure to obtain such permits, licenses or other approvals would not reasonably be expected to result in a Material Adverse Effect; and (C) are in compliance, in all material respects, with all terms and conditions of such required permits, licenses or other approvals. No action, proceeding, revocation proceeding, writ, injunction or claim is pending or, to the Company's knowledge, threatened against the Company or any of its Subsidiaries relating to Occupational Laws, and the Company does not have knowledge of any facts, circumstances or developments relating to its operations or cost accounting practices that would reasonably be expected to form the basis for or give rise to such actions, suits, investigations or proceedings that would, if there were an unfavorable outcome, reasonably be expected to result in a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) <u>Compliance</u>. Neither the Company nor any Subsidiary (i) is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other material agreement or instrument to which it is a party or by which it or any of its properties is bound, whether or not such default or violation has been waived, (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) <u>Environmental Laws</u>. (a) Neither the Company nor any of its Subsidiaries is in violation of any applicable international, national, state or local convention, law, regulation, order, governmental license, convention, treaty or other requirement relating to pollution or protection of human health or safety (as they relate to exposure to Materials of Environmental Concern (as defined below)) or protection of the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or protection of natural resources, including without limitation, conventions, laws or regulations relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum, petroleum products or other hydrocarbons (collectively, "<u>Materials of Environmental Concern</u>"), or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of Environmental Concern (collectively, "<u>Environmental Laws</u>"), nor has the Company or any Subsidiary received any written communication, whether from a Governmental Authority, citizens group, employee or otherwise, that alleges that the Company or any such Subsidiary is in violation of any Environmental Law or governmental license required pursuant to Environmental Law; except, in each case, as would not, individually or in the aggregate, have a Material Adverse Effect; (b) there is no claim, action or cause of action filed with a court or Governmental Authority and no investigation, or other action with respect to which the Company or any Subsidiary has received written notice alleging potential liability for investigatory costs, cleanup costs, governmental response costs, natural resources damages, property damages, personal injuries, attorneys' fees or penalties arising out of, based on or resulting from the presence, or release into the environment, of any Material of Environmental Concern at any location owned, leased or operated by the Company or any Subsidiary, now or in the past, or from any vessel owned, leased or operated by the Company or any Subsidiary, now or in the past (collectively, "<u>Environmental Claim</u>"), pending or, to the knowledge of the Company, threatened against the Company or any Subsidiary or any person or entity whose liability for any Environmental Claim the Company or any Subsidiary has retained or assumed either contractually or by operation of law, except as would not, individually or in the aggregate, have a Material Adverse Effect; (c) to the knowledge of the Company, there are no past or present actions, activities, circumstances, conditions, events or incidents, including, without limitation, the release, emission, discharge, presence or disposal of any Material of Environmental Concern, that reasonably would be expected to result in a violation of any Environmental Law, require expenditures to be incurred pursuant to Environmental Law, or form the basis of an Environmental Claim against the Company, any Subsidiary or against any person or entity whose liability for any Environmental Claim the Company or any Subsidiary has retained or assumed either contractually or by operation of law, except as would not, individually or in the aggregate, have a Material Adverse Effect); and (d) none of the Company or any Subsidiary is subject to any pending proceeding under Environmental Law to which a Governmental Authority is a party and which the Company reasonably believes is likely to result in monetary sanctions of $100,000 or more. The Company has reasonably concluded that any existing compliance and remediation costs and liabilities arising under Environmental Laws and resulting from the business, operations or properties of the Company or any Subsidiary would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, except as set forth in or contemplated in the Registration Statement and the Prospectus. In the ordinary course of its business, the Company conducts a periodic review of the effect of Environmental Laws on the business, operations and properties of the Company and the Subsidiaries, in the course of which it identifies and evaluates associated costs and liabilities (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties). No facts or circumstances have come to the Company's attention that could result in costs or liabilities that could be expected, individually or in the aggregate, to have a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) <u>Regulatory Permits</u>. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports, except where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect ("<u>Material Permits</u>"), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification of any Material Permit. The disclosures in the Registration Statement concerning the effects of federal, state, local and all foreign regulation on the Company's business as currently contemplated are correct in all material respects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) <u>Title to Assets</u>. The Company and the Subsidiaries have good and marketable title in fee simple to, or have valid and marketable rights to lease or otherwise use, all real property and all personal property that is material to the business of the Company and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP, and the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) <u>Intellectual Property</u>. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights necessary or required for use in connection with their respective businesses as described in the Registration Statement and the Prospectus and which the failure to do so could have a Material Adverse Effect (collectively, the "<u>Intellectual Property Rights</u>"). None of, and neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date of this Agreement, except where such action would not reasonably be expected to have a Material Adverse Effect. Neither the Company nor any Subsidiary has received, since the date of the latest audited financial statements included within the SEC Reports, a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, except as would not reasonably be expected to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights. The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their Intellectual Property Rights, except where failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) <u>Insurance</u>. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business without a material increase in cost.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) <u>Transactions With Affiliates and Employees</u>. None of the officers or directors of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments to or from, any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee, shareholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits, including share option agreements under any share option plan of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) <u>Sarbanes-Oxley; Internal Accounting Controls</u>. The Company and the Subsidiaries are in compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date. The Company and the Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management's general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management's general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company and the Subsidiaries have established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms. The Company's certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such date, the "Evaluation Date"). The Company presented in its most recently filed periodic report under the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over financial reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) <u>Certain Fees</u>. Except as set forth in the Registration Statement, the Pricing Prospectus and the Prospectus, no brokerage or finder's fees or commissions are or will be payable by the Company, any Subsidiary or Affiliate of the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. To the Company's knowledge, there are no other arrangements, agreements or understandings of the Company or, to the Company's knowledge, any of its shareholders that may affect the Representative's compensation, as determined by FINRA. The Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder's fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who raised or provided capital to the Company with respect to the transactions contemplated by the Transaction Documents; (ii) any FINRA member participating in the Offering as defined in FINRA Rule 5110 (a "Participating Member"); or (iii) any person or entity that has any direct or indirect affiliation or association with any Participating Member, within the twelve (12) months prior to the date hereof. None of the net proceeds of the Offering will be paid by the Company to any Participating Member or its affiliates, except as specifically authorized herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) <u>Investment Company</u>. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Securities will not be or be an Affiliate of, an "investment company" within the meaning of the Investment Company Act of 1940, as amended. The Company shall conduct its business in a manner so that it will not become required to register as an "investment company" under the Investment Company Act of 1940, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w) <u>Registration Rights</u>. No Person has any right to cause the Company or any Subsidiary to effect the registration under the Securities Act of any securities of the Company or any Subsidiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) <u>Listing and Maintenance Requirements</u>. The Ordinary Shares are registered pursuant to Section 12(b) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Ordinary Shares under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration. The Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market on which the Ordinary Shares are or have been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Ordinary Shares are currently eligible for electronic transfer through the Depository Trust Company or another established clearing corporation and the Company is current in payment of the fees to the Depository Trust Company (or such other established clearing corporation) in connection with such electronic transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y) <u>Intentionally Omitted</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z) <u>Disclosure; 10b-5</u>. The Registration Statement (and any further documents to be filed with the Commission) contains all exhibits and schedules as required by the Securities Act. Each of the Registration Statement and any post-effective amendment thereto, if any, at the time it became effective, complied in all material respects with the Securities Act and the Exchange Act and the applicable rules and regulations under the Securities Act and did not and, as amended or supplemented, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. The Registration Statement, Pricing Prospectus and the Prospectus, each as of its respective date, comply in all material respects with the Securities Act and the Exchange Act and the applicable rules and regulations. Each of the Registration Statement, Pricing Prospectus and the Prospectus, as amended or supplemented, did not and will not contain as of the date thereof any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The SEC Reports, when they were filed with the Commission, conformed in all material respects to the requirements of the Exchange Act and the applicable rules and regulations, and none of such documents, when they were filed with the Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements therein (with respect to the SEC Reports incorporated by reference in the Registration Statement, Pricing Prospectus or Prospectus), in light of the circumstances under which they were made not misleading; and any further documents so filed and incorporated by reference in the Registration Statement, Pricing Prospectus or Prospectus, when such documents are filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and the applicable rules and regulations, as applicable, and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made not misleading. No post-effective amendment to the Registration Statement reflecting any facts or events arising after the date thereof which represent, individually or in the aggregate, a fundamental change in the information set forth therein is required to be filed with the Commission. There are no documents required to be filed with the Commission in connection with the transaction contemplated hereby that (x) have not been filed as required pursuant to the Securities Act or (y) will not be filed within the requisite time period. There are no contracts or other documents required to be described in the Pricing Prospectus, Prospectus, or to be filed as exhibits or schedules to the Registration Statement, which have not been described or filed as required. The press releases disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made and when made, not misleading.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(aa) <u>No Integrated Offering</u>. Neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering of the Securities to be integrated with prior offerings by the Company for purposes of any applicable shareholder approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(bb) <u>Solvency</u>. Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company of the proceeds from the sale of the Securities hereunder, (i) the fair saleable value of the Company's assets exceeds the amount that will be required to be paid on or in respect of the Company's existing debts and other liabilities (including known contingent liabilities) as they mature, (ii) the Company's assets do not constitute unreasonably small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability thereof and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. The Registration Statement sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary. For the purposes of this Agreement, "<u>Indebtedness</u>" means (x) any liabilities for borrowed money or amounts owed in excess of $100,000 (other than trade accounts payable incurred in the ordinary course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company's consolidated balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (z) the present value of any lease payments in excess of $100,000 due under leases required to be capitalized in accordance with GAAP. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness that would reasonably be expected to result in a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(cc) <u>Tax Status</u>. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of such consolidated financial statements. The term "taxes" mean all federal, state, local, foreign, and other net income, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments, or charges of any kind whatsoever, together with any interest and any penalties, additions to tax, or additional amounts with respect thereto. The term "returns" means all returns, declarations, reports, statements, and other documents required to be filed in respect to taxes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(dd) <u>Foreign Corrupt Practices</u>. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which is in violation of Applicable Law, or (iv) violated in any material respect any provision of the FCPA or any foreign equivalent. The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply in all material respects with the FCPA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ee) <u>Accountants</u>. The Company's accounting firm is set forth in the Pricing Prospectus and Prospectus. To the knowledge and belief of the Company, such accounting firm (i) is an independent registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the Company's Annual Report for the fiscal year ending December 31, 2025.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ff) <u>Reserved</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(gg) <u>Share Option Plans</u>. The Company has no outstanding stock options granted under any equity incentive plan or otherwise as compensation to its directors and officers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(hh) <u>Office of Foreign Assets Control</u>. Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director, officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>U.S. Real Property Holding Corporation</u>. The Company is not and has never been a U.S. real property holding corporation within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon the Representative's request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(jj) <u>Bank Holding Company Act</u>. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as amended (the "<u>BHCA</u>") and to regulation by the Board of Governors of the Federal Reserve System (the "<u>Federal Reserve</u>"). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(kk) <u>Money Laundering</u>. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the "<u>Money Laundering Laws</u>"), and no Action or Proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ll) <u>D&O Questionnaires</u>. To the Company's knowledge, all information contained in the questionnaires completed by each of the Company's directors and officers prior to the Offering and in the Lock-Up Agreement provided to the Underwriters is true and correct in all respects and the Company has not become aware of any information which would cause the information disclosed in such questionnaires become inaccurate and incorrect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(mm) <u>FINRA Affiliation</u>. No officer, director or any beneficial owner of 5% or more of the Company's unregistered securities has any direct or indirect affiliation or association with any FINRA member (as determined in accordance with the rules and regulations of FINRA) that is participating in the Offering. The Company will advise the Representative and EGS if it learns that any officer, director or owner of 5% or more of the Company's outstanding Ordinary Shares or Ordinary Share Equivalents is or becomes an affiliate or associated person of a FINRA member firm.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(nn) <u>Officers' Certificate</u>. Any certificate signed by any duly authorized officer of the Company and delivered to the Representative or EGS shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(oo) <u>Board of Directors</u>. The Board of Directors is comprised of the persons set forth under the heading of the Prospectus captioned "Management." The qualifications of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder applicable to the Company and the rules of the Trading Market. In addition, at least a majority of the persons serving on the Board of Directors qualify as "independent" as defined under the rules of the Trading Market. At least one member of the Board of Directors qualifies as a "financial expert" as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and the rules of the Trading Market.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(pp) <u>Cybersecurity</u>. To the Company's knowledge, there has been no material security breach or other compromise of or relating to any of the Company's or any Subsidiary's information technology and computer systems, networks, hardware, software, data (including the data of their respective customers, employees, suppliers, vendors and any third party data maintained by them or on their behalf), equipment or technology (collectively, "<u>IT Systems and Data</u>") and (y) the Company and the Subsidiaries have not been notified of, and have no knowledge of any event or condition that would reasonably be expected to result in, any material security breach or other compromise to its IT Systems and Data; (ii) the Company and the Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders, rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification, except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; (iii) the Company and the Subsidiaries have implemented and maintained commercially reasonable safeguards for companies similarly situated to maintain and protect its material confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and Data; and (iv) the Company and the Subsidiaries have implemented commercially reasonable backup and disaster recovery technology consistent with industry standards and practices for companies similarly situated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(qq) <u>Compliance with Data Privacy Laws</u>. (i) The Company and the Subsidiaries are, and at all times during the last three (3) years were, in compliance in all material respects with all applicable state, federal and foreign data privacy and security laws and regulations, including, without limitation, the European Union General Data Protection Regulation ("<u>GDPR</u>") (EU 2016/679) (collectively, "<u>Privacy Laws</u>"); (ii) the Company and the Subsidiaries have in place, comply with, and take appropriate steps reasonably designed to ensure compliance in all material respects with their policies and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling and analysis of Personal Data (as defined below) (the "<u>Policies</u>"); (iii) the Company provides accurate notice of its applicable Policies to its customers, employees, third party vendors and representatives as required by the Privacy Laws; and (iv) applicable Policies provide accurate and sufficient notice of the Company's then-current privacy practices relating to its subject matter, and do not contain any material omissions of the Company's then-current privacy practices, as required by Privacy Laws. "<u>Personal Data</u>" means (i) a natural person's name, street address, telephone number, email address, photograph, social security number, bank information, or customer or account number; (ii) any information which would qualify as "personally identifying information" under the Federal Trade Commission Act, as amended; (iii) "personal data" as defined by GDPR; and (iv) any other piece of information that allows the identification of such natural person, or his or her family, or permits the collection or analysis of any identifiable data related to an identified person's health or sexual orientation. None of such disclosures made or contained in any of the Policies have been inaccurate, misleading, or deceptive in violation of any Privacy Laws and the execution, delivery and performance of the Transaction Documents will not result in a breach of any Privacy Laws or Policies, except, in each case, as would not reasonably be expected to result in a Material Adverse Effect. Neither the Company nor the Subsidiaries (i) to the knowledge of the Company, has received written notice of any actual or potential liability of the Company or the Subsidiaries under, or actual or potential violation by the Company or the Subsidiaries of, any of the Privacy Laws; (ii) is currently conducting or paying for, in whole or in part, any investigation, remediation or other corrective action pursuant to any regulatory request or demand pursuant to any Privacy Law; or (iii) is a party to any order, decree, or agreement by or with any court or arbitrator or governmental or regulatory authority that imposed any obligation or liability under any Privacy Law, except, in each case, as would not reasonably be expected to result in a Material Adverse Effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(rr) <u>Foreign Private Issuer</u>. The Company is a "foreign private issuer" as defined in Rule 405 promulgated under the Securities Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ss) <u>PRC Related Representations</u>. Each of the Company and its Subsidiaries has complied, and has taken all steps to ensure compliance, in material respects, by each of its shareholders, directors and officers that is, or is directly or indirectly owned or controlled by, a PRC resident or citizen with any applicable rules and regulations of the relevant PRC government agencies in effect on the applicable Closing Date (including but not limited to the Ministry of Commerce, the National Development and Reform Commission, the China Securities Regulatory Commission ("**CSRC**") and the State Administration of Foreign Exchange) (the "**SAFE**") relating to overseas investment by PRC residents and citizens (the "**PRC Overseas Investment and Listing Regulations**"), including, requesting each such person that is, or is directly or indirectly owned or controlled by, a PRC resident or citizen to complete any registration and other procedures required under applicable PRC Overseas Investment and Listing Regulations (including any applicable rules and regulations of the SAFE). The Company is aware of and has been advised as to the content of the Provisions on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors and any official clarifications, guidance, interpretations, implementation rules, revisions in connection with or related thereto in effect on the applicable Closing Date (the "**PRC Mergers and Acquisitions Rules**") jointly promulgated by the Ministry of Commerce, the State Assets Supervision and Administration Commission, the State Tax Administration, the State Administration of Industry and Commerce, the CSRC and the SAFE on August 8, 2006, including the provisions thereof which purport to require offshore special purpose entities formed for listing purposes and controlled directly or indirectly by PRC companies or individuals to obtain the approval of the CSRC prior to the listing and trading of their securities on an overseas stock exchange. The Company has received legal advice specifically with respect to the PRC Mergers and Acquisitions Rules from its PRC counsel, and the Company understands such legal advice. In addition, the Company has communicated such legal advice in full to each of its directors and each such director has confirmed that he or she understands such legal advice.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(tt) <u>Validity of Choice of Law</u>. The choice of the laws of the State of New York as the governing law of this Agreement and the Transaction Documents is a valid choice of law under the laws of the Cayman Islands and the PRC and will be honored by courts in the Cayman Islands and the PRC. The Company has the power to submit, and pursuant to this Agreement and the other Transaction Documents, has legally, validly, effectively and irrevocably submitted, to the personal jurisdiction of each of the State of New York and United States Federal court sitting in New York County (each, a "**New York Court**") and has validly and irrevocably waived any objection to the laying of venue of any suit, action or proceeding brought in any such court; and the Company has the power to designate, appoint and empower, and pursuant to this Agreement and the other Transaction Documents, has legally, validly, effectively and irrevocably designated, appointed and empowered, an authorized agent for service of process in any action arising out of or relating to this Agreement or the other Transaction Documents, or the offering of the Securities in any New York Court, and service of process effected on such authorized agent will be effective to confer valid personal jurisdiction over the Company as provided in this Agreement and the other Transaction Document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(uu) Enforceability of Judgment. Any final judgment for a fixed or readily calculable sum of money rendered by a New York Court having jurisdiction under its own domestic laws in respect of any suit, action or proceeding against the Company based upon this Agreement or the other Transaction Documents and any instruments or agreements entered into for the consummation of the transactions contemplated herein and therein would be declared enforceable against the Company, without re-examination or review of the merits of the cause of action in respect of which the original judgment was given or re-litigation of the matters adjudicated upon, by the courts of the Cayman Islands and the PRC, provided that with respect to courts of the PRC, (A) adequate service of process has been effected and the defendant has had a reasonable opportunity to be heard, (B) such judgments or the enforcement thereof are not contrary to the law, public policy, security or sovereignty of the PRC, (C) such judgments were not obtained by fraudulent means and do not conflict with any other valid judgment in the same matter between the same parties and (D) an action between the same parties in the same matter is not pending in any PRC court at the time the lawsuit is instituted in a foreign court. The Company is not aware of any reason why the enforcement in the Cayman Islands or the PRC of such a New York Court judgment would be, as of the date hereof, contrary to public policy of the Cayman Islands or the PRC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vv) <u>No Immunity</u>. None of the Company or its Subsidiaries or any of their respective properties, assets or revenues has any right of immunity, under the laws of Hong Kong, the PRC or the State of New York, from any legal action, suit or proceeding, the giving of any relief in any such legal action, suit or proceeding, set-off or counterclaim, the jurisdiction of any Hong Kong, the PRC, New York or United States federal court, service of process, attachment upon or prior to judgment, or attachment in aid of execution of judgment, or execution of a judgment, or other legal process or proceeding for the giving of any relief or for the enforcement of a judgment, in any such court, with respect to its obligations, liabilities or any other matter under or arising out of or in connection with this Agreement; and, to the extent that the Company or any of its Subsidiaries or any of their respective properties, assets or revenues may have or may hereafter become entitled to any such right of immunity in any such court in which proceedings may at any time be commenced, each of the Company and its Subsidiaries waives or will waive such right to the extent permitted by law and has consented to such relief and enforcement as provided in this Agreement.

**ARTICLE IV.**

**OTHER AGREEMENTS OF THE PARTIES**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 <u>Amendments to Registration Statement</u>. The Company has delivered, or will as promptly as practicable deliver, to the Underwriters complete conformed copies of the Registration Statement and of each consent and certificate of experts, as applicable, filed as a part thereof, and conformed copies of the Registration Statement (without exhibits), the Pricing Prospectus and the Prospectus, as amended or supplemented, in such quantities and at such places as an Underwriter reasonably requests. Neither the Company nor any of its directors and officers has distributed and none of them will distribute, prior to the Closing Date, any offering material in connection with the offering and sale of the Securities other than the Pricing Prospectus, the Prospectus, the Registration Statement, and copies of the documents incorporated by reference therein. The Company shall not file any such amendment or supplement to which the Representative shall reasonably object in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 <u>Federal Securities Laws</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Compliance</u>. During the time when a Prospectus is required to be delivered under the Securities Act, the Company will use its best efforts to comply with all requirements imposed upon it by the Securities Act and the rules and regulations thereunder and the Exchange Act and the rules and regulations thereunder, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Securities in accordance with the provisions hereof and the Prospectus. If at any time when a Prospectus relating to the Securities is required to be delivered under the Securities Act, any event shall have occurred as a result of which, in the opinion of counsel for the Company or counsel for the Underwriters, the Prospectus, as then amended or supplemented, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Securities Act, the Company will notify the Underwriters promptly and prepare and file with the Commission, subject to Section 4.1 hereof, an appropriate amendment or supplement in accordance with Section 10 of the Securities Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Filing of Final Prospectus</u>. The Company will file the Prospectus (in form and substance satisfactory to the Representative) with the Commission pursuant to the requirements of Rule 424.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Exchange Act Registration</u>. For a period of three years from the Execution Date, the Company will use its commercially reasonable efforts to maintain the registration of the Ordinary Shares under the Exchange Act. The Company will not deregister the Ordinary Shares under the Exchange Act without the prior written consent of the Representative.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Free Writing Prospectuses</u>. The Company represents and agrees that it has not made and will not make any offer relating to the Securities that would constitute an issuer free writing prospectus, as defined in Rule 433 of the rules and regulations under the Securities Act, without the prior written consent of the Representative. Any such free writing prospectus consented to by the Representative is herein referred to as a "<u>Permitted Free Writing Prospectus</u>." The Company represents that it will treat each Permitted Free Writing Prospectus as an "issuer free writing prospectus" as defined in rule and regulations under the Securities Act, and has complied and will comply with the applicable requirements of Rule 433 of the Securities Act, including timely Commission filing where required, legending and record keeping.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 <u>Delivery to the Underwriters of Prospectuses</u>. The Company will deliver to the Underwriters, without charge, from time to time during the period when the Prospectus is required to be delivered under the Securities Act or the Exchange Act such number of copies of each Prospectus as the Underwriters may reasonably request and, if requested, as soon as the Registration Statement or any amendment or supplement thereto becomes effective, deliver to the Representative two original executed Registration Statements, including exhibits, and all post-effective amendments thereto and copies of all exhibits filed therewith or incorporated therein by reference and all original executed consents of certified experts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 <u>Effectiveness and Events Requiring Notice to the Underwriters</u>. The Company will use its commercially reasonable efforts to cause the Registration Statement to remain effective with a current prospectus until the earlier of nine (9) months from the Execution Date and the date on which the Warrants are no longer outstanding, and will notify the Underwriters and holders of the Warrants immediately and confirm the notice in writing: (i) of the effectiveness of the Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the Securities for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the period described in this Section 4.4 that, in the judgment of the Company, makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or that requires the making of any changes in the Registration Statement or the Prospectus in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state securities commission shall enter a stop order or suspend such qualification at any time, the Company will make every reasonable effort to obtain promptly the lifting of such order.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 <u>Reserved</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6 <u>Expenses of the Offering</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>General Expenses Related to the Offering</u>. The Company hereby agrees to pay on each of the Closing Date and each Option Closing Date, if any, to the extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company under this Agreement, including, but not limited to: (a) all filing fees and communication expenses relating to the registration of the Public Shares to be sold in the Offering (including the Option Shares) with the Commission; (b) all FINRA Public Offering Filing System fees associated with the review of the Offering by FINRA; all fees and expenses relating to the listing of such Closing Shares and Option Shares on the Trading Market and such other stock exchanges as the Company and the Representative together determine; (c) all fees, expenses and disbursements relating to the registration or qualification of such Public Shares under the "blue sky" securities laws of such states and other foreign jurisdictions as the Representative may reasonably designate (including, without limitation, all filing and registration fees, and the fees and expenses of Blue Sky counsel, if applicable); (d) the costs of all mailing and printing of the Registration Statements, Prospectuses and all amendments, supplements and exhibits thereto and as many preliminary and final Prospectuses as the Representative may reasonably deem necessary; (e) the costs and expenses of the Company's public relations firm; (f) the costs of preparing, printing and delivering the Public Shares; (g) fees and expenses of the Transfer Agent for the Public Shares (including, without limitation, any fees required for same-day processing of any instruction letter delivered by the Company); (h) share transfer and/or stamp taxes, if any, payable upon the transfer of securities from the Company to the Underwriters; (i) the fees and expenses of the Company's accountants; (j) the fees and expenses of the Company's legal counsel and other agents and representatives; (k) all fees, expenses and disbursements relating to background checks of the Company's officers and directors; (l) the fees and expenses for the Underwriters' use of i-Deal's book-building, prospectus tracking and compliance software (or other similar software) for the Offering; and (m) the fees and expenses for the Underwriters' actual and documented reasonably incurred "road show" expenses for the Offering. The Underwriters may also deduct from the net proceeds of the Offering payable to the Company on the Closing Date, or each Option Closing Date, if any, the expenses set forth herein to be paid by the Company to the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Expenses of the Representative</u>. The Company agrees that on the Closing Date it will reimburse the Representative up to $100,000 for its legal fees, costs and expenses related to the Offering (including such expenses pursuant to Section 4.6(a)) by deduction from the proceeds of the Offering contemplated herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7 <u>Application of Net Proceeds</u>. The Company will apply the net proceeds from the Offering received by it in a manner consistent with the application described under the caption "Use of Proceeds" in the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.8 <u>Delivery of Earnings Statements to Security Holders</u>. The Company will make generally available to its security holders as soon as practicable, but not later than the first day of the fifteenth full calendar month following the Execution Date, an earnings statement (which need not be certified by independent public or independent certified public accountants unless required by the Securities Act or the Rules and Regulations under the Securities Act, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Securities Act) covering a period of at least twelve consecutive months beginning after the Execution Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.9 <u>Stabilization</u>. Neither the Company, nor, to its knowledge, any of its employees, directors or shareholders (without the consent of the Representative) has taken or will take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to cause or result in, under the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.10 <u>Internal Controls</u>. The Company will maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management's general or specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management's general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.11 <u>Accountants</u>. The Company shall continue to retain an independent certified public accounting firm for a period of at least three years after the Execution Date. The Underwriters acknowledge that the Company Auditor is acceptable to the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.12 <u>FINRA</u>. The Company shall advise the Underwriters (who shall make an appropriate filing with FINRA) if it is aware that any 5% or greater shareholder of the Company becomes an affiliate or associated person of an Underwriter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.13 <u>No Fiduciary Duties</u>. The Company acknowledges and agrees that the Underwriters' responsibility to the Company is solely contractual and commercial in nature, based on arms-length negotiations and that neither the Underwriters nor their affiliates or any selected dealer shall be deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary duty to the Company or any of its affiliates in connection with the Offering and the other transactions contemplated by this Agreement. Notwithstanding anything in this Agreement to the contrary, the Company acknowledges that the Underwriters may have financial interests in the success of the Offering that are not limited to the difference between the price to the public and the purchase price paid to the Company by the Underwriters for the shares and the Underwriters have no obligation to disclose, or account to the Company for, any of such additional financial interests. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against the Underwriters with respect to any breach or alleged breach of fiduciary duty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.14 <u>Warrant Shares</u>. If all or any portion of a Warrant is exercised at a time when there is an effective registration statement to cover the issuance of the Warrant Shares or if the Warrant is exercised via cashless exercise, the Warrant Shares issued pursuant to any such exercise shall be issued free of all restrictive legends. If at any time following the date hereof the Registration Statement (or any subsequent registration statement registering the sale or resale of the Warrant Shares) is not effective or is not otherwise available for the sale of the Warrant Shares, the Company shall immediately notify the holders of the Warrants in writing that such registration statement is not then effective or available and thereafter shall promptly notify such holders when the registration statement is effective and available again for the sale of the Warrant Shares (it being understood and agreed that the foregoing shall not limit the ability of the Company to issue, or any holder thereof to sell, any of the Warrant Shares in compliance with applicable federal and state securities laws).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.15 <u>Board Composition and Board Designations</u>. The Company shall ensure that: (i) the qualifications of the persons serving as board members and the overall composition of the Board of Directors comply with the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder and with the listing requirements of the Trading Market and (ii) to the extent required by the Trading Market, at least one member of the Board of Directors qualifies as a "financial expert" as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.16 <u>Securities Laws Disclosure; Publicity</u>. At the request of the Representative, by [9:00 a.m.] (New York City time) on the date hereof, the Company shall issue a press release disclosing the material terms of the Offering. The Company and the Representative shall consult with each other in issuing any other press releases with respect to the Offering, and neither the Company nor any Underwriter shall issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of such Underwriter, or without the prior consent of such Underwriter, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or communication. The Company will not issue press releases or engage in any other publicity, without the Representative's prior written consent, for a period ending at 5:00 p.m. (New York City time) on the first business day following the 45th day following the Closing Date, other than normal and customary releases issued in the ordinary course of the Company's business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.17 <u>Shareholder Rights Plan</u>. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Underwriter of the Securities is an "Acquiring Person" under any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Underwriter of Securities could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.18 <u>Reservation of Ordinary Shares</u>. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available at all times, free of preemptive rights, a sufficient number of Ordinary Shares for the purpose of enabling the Company to issue Option Shares pursuant to the Option and Warrant Shares pursuant to any exercise of the Warrants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.19 <u>Listing of Ordinary Shares</u>. The Company hereby agrees to use commercially reasonable efforts to maintain the listing or quotation of the Ordinary Shares on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list or quote all of the Closing Shares, Option Shares and Warrant Shares on such Trading Market and promptly secure the listing of all of the Closing Shares, Option Shares and Warrant Shares on such Trading Market. The Company further agrees, if the Company applies to have the Ordinary Shares traded on any other Trading Market, it will then include in such application all of the Closing Shares, Option Shares and Warrant Shares, and will take such other action as is necessary to cause all of the Closing Shares, Option Shares and Warrant Shares to be listed or quoted on such other Trading Market as promptly as possible. The Company will then use commercially reasonable efforts to maintain the listing or quotation of the Ordinary Shares on such other Trading Market and to comply in all respects with the Company's reporting, filing and other obligations under the bylaws or rules of such other Trading Market. The Company agrees to maintain the eligibility of the Ordinary Shares for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.20 <u>Right of First Refusal</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) We have agreed that upon the Closing of this Offering, for a period of six (6) months from the Closing, the Company, or any successor to or any subsidiary of the Company, will grant the Representative the right of first refusal to act as sole managing underwriter and sole book runner, sole placement agent, or sole sales agent, for any and all future public or private equity, equity-linked or debt (excluding commercial bank debt) offerings for which the Company retains the service of an underwriter, agent, advisor, finder or other person or entity in connection with such offering during such six (6) month period of the Company, or any successor to or any subsidiary of the Company. For the avoidance of doubt, such right of first refusal shall not apply to any offerings of securities not involving any placement agent or underwriter. The Company shall not offer to retain any entity or person in connection with any such offering on terms more favorable than terms on which it offers to retain the Representative. Such offer shall be made in writing in order to be effective. The Representative shall notify the Company within ten (10) business days of its receipt of the written offer contemplated above as to whether or not it agrees to accept such retention. If the Representative should decline such retention, the Company shall have no further obligations to the Representative with respect to the offering for which it has offered to retain the Representative, except as otherwise provided for herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Notwithstanding anything to the contrary contained in Section 4.20(a), the Company shall have the option to buy out and terminate the right of first refusal granted to the Representative under Section 4.20(a) in its entirety by paying the Representative a one-time cash fee equal to three percent (3%) of the aggregate gross proceeds raised in this Offering or an alternative transaction with the Representative (the "Buyout Fee"). The Buyout Fee shall be paid simultaneously with the Company's delivery of written notice to the Representative of its election to exercise this buyout option. Upon receipt of the Buyout Fee by the Representative, the right of first refusal set forth in Section 4.20(a) shall be immediately terminated and of no further force or effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.21 <u>Tail Financing Payments</u>. Upon Closing or if the Closing of the Offering does not occur prior to the end of the Representative's Engagement Period (as defined in the Engagement Agreement) (other than a termination for Cause (as defined in the Engagement Agreement)), then if within twelve (12) months following such time, the Company completes any financing of equity, equity-linked, convertible or debt or other capital-raising activity with, or receives any proceeds from, any investors the Representative contacted or introduced to the Company, then the Company shall pay to the Representative upon closing of such financing or receipt of such proceeds the cash compensation as described herein, in each case only with respect to the portion of such proceeds received from such investors. Upon written request of the Company, the Representative shall provide a list of such investors to the Company within five (5) Business Days of such request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.22 <u>Subsequent Equity Sales</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) From the date hereof until ten (10) days after the Closing Date, neither the Company nor any Subsidiary shall (i) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any Ordinary Shares or Ordinary Share Equivalents or (ii) file any registration statement or amendment or supplement thereto, other than the Prospectus, or filing a registration statement on Form S-8 in connection with any employee benefit plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) From the date hereof until ten (10) days after the Closing Date, the Company shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its Subsidiaries of Ordinary Shares or Ordinary Share Equivalents (or a combination of units thereof) involving a Variable Rate Transaction. "<u>Variable Rate Transaction</u>" means a transaction in which the Company (i) issues or sells any debt or equity securities that are convertible into, exchangeable or exercisable for, or include the right to receive additional Ordinary Shares either (A) at a conversion price, exercise price or exchange rate or other price that is based upon and/or varies with the trading prices of or quotations for the Ordinary Shares at any time after the initial issuance of such debt or equity securities, or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance of such debt or equity security or upon the occurrence of specified or contingent events directly or indirectly related to the business of the Company or the market for the Ordinary Shares or (ii) enters into, or effects a transaction under, any agreement, including, but not limited to, an equity line of credit or an "at-the-market offering", whereby the Company may issue securities at a future determined price regardless of whether shares pursuant to such agreement have actually been issued and regardless of whether such agreement is subsequently canceled. Any Underwriter shall be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to any right to collect damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding the foregoing, this Section 4.22 shall not apply in respect of an Exempt Issuance, except that no Variable Rate Transaction shall be an Exempt Issuance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.23 <u>PRC Compliance</u>*.* The Company shall comply with the PRC Overseas Investment and Listing Regulations, and use its reasonable efforts to cause holders of its Ordinary Shares that are, or that are directly or indirectly owned or controlled by, Chinese residents or Chinese citizens, to comply with the PRC Overseas Investment and Listing Regulations applicable to them, including requesting each such shareholder to complete any registration and other procedures required under applicable PRC Overseas Investment and Listing Regulations (including any applicable rules and regulations of the SAFE).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.24 <u>Research Independence</u>. The Company acknowledges that each Underwriter's research analysts and research departments, if any, are required to be independent from their respective investment banking divisions and are subject to certain regulations and internal policies, and that such Underwriter's research analysts may hold and make statements or investment recommendations and/or publish research reports with respect to the Company and/or the offering that differ from the views of its investment bankers. The Company hereby waives and releases, to the fullest extent permitted by law, any claims that the Company may have against such Underwriter with respect to any conflict of interest that may arise from the fact that the views expressed by their independent research analysts and research departments may be different from or inconsistent with the views or advice communicated to the Company by such Underwriter's investment banking divisions. The Company acknowledges that the Representative is a full service securities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short position in debt or equity securities of the Company.

**ARTICLE V.**

**DEFAULT BY UNDERWRITERS**

If on the Closing Date or any Option Closing Date, if any, any Underwriter shall fail to purchase and pay for the portion of the Closing Securities or Option Securities, as the case may be, which such Underwriter has agreed to purchase and pay for on such date (otherwise than by reason of any default on the part of the Company), the Representative, or if the Representative is the defaulting Underwriter, the non-defaulting Underwriters, shall use their reasonable efforts to procure within 36 hours thereafter one or more of the other Underwriters, or any others, to purchase from the Company such amounts as may be agreed upon and upon the terms set forth herein, the Closing Securities or Option Securities, as the case may be, which the defaulting Underwriter or Underwriters failed to purchase. If during such 36 hours the Representative shall not have procured such other Underwriters, or any others, to purchase the Closing Securities or Option Securities, as the case may be, agreed to be purchased by the defaulting Underwriter or Underwriters, then (a) if the aggregate number of Closing Securities or Option Securities, as the case may be, with respect to which such default shall occur does not exceed 10% of the Closing Securities or Option Securities, as the case may be, covered hereby, the other Underwriters shall be obligated, severally, in proportion to the respective numbers of Closing Securities or Option Securities, as the case may be, which they are obligated to purchase hereunder, to purchase the Closing Securities or Option Securities, as the case may be, which such defaulting Underwriter or Underwriters failed to purchase, or (b) if the aggregate number of Closing Securities or Option Securities, as the case may be, with respect to which such default shall occur exceeds 10% of the Closing Securities or Option Securities, as the case may be, covered hereby, the Company or the Representative will have the right to terminate this Agreement without liability on the part of the non-defaulting Underwriters or of the Company except to the extent provided in Article VI hereof. In the event of a default by any Underwriter or Underwriters, as set forth in this Article V, the applicable Closing Date may be postponed for such period, not exceeding seven days, as the Representative, or if the Representative is the defaulting Underwriter, the non-defaulting Underwriters, may determine in order that the required changes in the Prospectus or in any other documents or arrangements may be effected. The term "Underwriter" includes any Person substituted for a defaulting Underwriter. Any action taken under this Section shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.

**ARTICLE VI.**

**INDEMNIFICATION**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 <u>Indemnification of the Underwriters</u>. Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless the Underwriters, and each dealer selected by each Underwriter that participates in the offer and sale of the Securities (each a "<u>Selected Dealer</u>") and each of their respective directors, officers and employees and each Person, if any, who controls such Underwriter or any Selected Dealer ("<u>Controlling Person</u>") within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between such Underwriter and the Company or between such Underwriter and any third party or otherwise) to which they or any of them may become subject under the Securities Act, the Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries, arising out of or based upon any Proceeding, commenced or threatened (whether or not such Underwriter is a target of or party to such Proceeding), or arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in (i) any Preliminary Prospectus, if any, the Registration Statement or the Prospectus (as from time to time each may be amended and supplemented); (ii) any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the offering of the Securities, including any "road show" or investor presentations made to investors by the Company (whether in person or electronically); or (iii) any application or other document or written communication (in this Article VI, collectively called "<u>application</u>") executed by the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Securities under the securities laws thereof or filed with the Commission, any state securities commission or agency, Trading Market or any securities exchange; or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, unless such statement or omission was made in reliance upon and in conformity with written information furnished to the Company with respect to the applicable Underwriter by or on behalf of such Underwriter expressly for use in any Preliminary Prospectus, if any, the Registration Statement or Prospectus, or any amendment or supplement thereto, or in any application, as the case may be. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Preliminary Prospectus, if any, the indemnity agreement contained in this Section 6.1 shall not inure to the benefit of an Underwriter to the extent that any loss, liability, claim, damage or expense of such Underwriter results from the fact that a copy of the Prospectus was not given or sent to the Person asserting any such loss, liability, claim or damage at or prior to the written confirmation of sale of the Securities to such Person as required by the Securities Act and the rules and regulations thereunder, and if the untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance by the Company with its obligations under this Agreement. The Company agrees promptly to notify each Underwriter of the commencement of any litigation or proceedings against the Company or any of its officers, directors or Controlling Persons in connection with the issue and sale of the Public Securities or in connection with the Registration Statement or Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 <u>Procedure</u>. If any action is brought against an Underwriter, a Selected Dealer or a Controlling Person in respect of which indemnity may be sought against the Company pursuant to Section 6.1, such Underwriter, such Selected Dealer or Controlling Person, as the case may be, shall promptly notify the Company in writing of the institution of such action and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the reasonable approval of such Underwriter or such Selected Dealer, as the case may be) and payment of actual expenses. Such Underwriter, such Selected Dealer or Controlling Person shall have the right to employ its or their own counsel in any such case, but the fees and expenses of such counsel shall be at the expense of such Underwriter, such Selected Dealer or Controlling Person unless (i) the employment of such counsel at the expense of the Company shall have been authorized in writing by the Company in connection with the defense of such action, or (ii) the Company shall not have employed counsel to have charge of the defense of such action, or (iii) such indemnified party or parties shall have reasonably concluded that there may be defenses available to it or them which are different from or additional to those available to the Company (in which case the Company shall not have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events the reasonable fees and expenses of not more than one additional firm of attorneys selected by such Underwriter (in addition to local counsel), Selected Dealer and/or Controlling Person shall be borne by the Company. Notwithstanding anything to the contrary contained herein, if any Underwriter, Selected Dealer or Controlling Person shall assume the defense of such action as provided above, the Company shall have the right to approve the terms of any settlement of such action which approval shall not be unreasonably withheld.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 <u>Indemnification of the Company</u>. Each Underwriter severally and not jointly agrees to indemnify and hold harmless the Company, its directors, officers and employees and agents who control the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company to such Underwriter, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions made in any Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or in any application, in reliance upon, and in strict conformity with, written information furnished to the Company with respect to such Underwriter by or on behalf of such Underwriter expressly for use in such Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or in any such application. In case any action shall be brought against the Company or any other Person so indemnified based on any Preliminary Prospectus, if any, the Registration Statement or Prospectus or any amendment or supplement thereto or any application, and in respect of which indemnity may be sought against such Underwriter, such Underwriter shall have the rights and duties given to the Company, and the Company and each other Person so indemnified shall have the rights and duties given to such Underwriter by the provisions of this Article VI. Notwithstanding the provisions of this Section 6.3, no Underwriter shall be required to indemnify the Company for any amount in excess of the underwriting discounts and commissions applicable to the Securities purchased by such Underwriter. The Underwriters' obligations in this Section 6.3 to indemnify the Company are several in proportion to their respective underwriting obligations and not joint.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 <u>Contribution</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Contribution Rights</u>. In order to provide for just and equitable contribution under the Securities Act in any case in which (i) any Person entitled to indemnification under this Article VI makes a claim for indemnification pursuant hereto but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case notwithstanding the fact that this Article VI provides for indemnification in such case, or (ii) contribution under the Securities Act, the Exchange Act or otherwise may be required on the part of any such Person in circumstances for which indemnification is provided under this Article VI, then, and in each such case, the Company and each Underwriter, severally and not jointly, shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Company and such Underwriter, as incurred, in such proportions that such Underwriter is responsible for that portion represented by the percentage that the underwriting discount appearing on the cover page of the Prospectus bears to the initial offering price appearing thereon and the Company is responsible for the balance; provided, that, no Person guilty of a fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each director, officer and employee of such Underwriter or the Company, as applicable, and each Person, if any, who controls such Underwriter or the Company, as applicable, within the meaning of Section 15 of the Securities Act shall have the same rights to contribution as such Underwriter or the Company, as applicable. Notwithstanding the provisions of this Section 6.4, no Underwriter shall be required to contribute any amount in excess of the underwriting discounts and commissions applicable to the Securities purchased by such Underwriter. The Underwriters' obligations in this Section 6.4 to contribute are several in proportion to their respective underwriting obligations and not joint.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Contribution Procedure</u>. Within fifteen days after receipt by any party to this Agreement (or its representative) of notice of the commencement of any action, suit or proceeding, such party will, if a claim for contribution in respect thereof is to be made against another party ("<u>contributing party</u>"), notify the contributing party of the commencement thereof, but the failure to so notify the contributing party will not relieve it from any liability which it may have to any other party other than for contribution hereunder. In case any such action, suit or proceeding is brought against any party, and such party notifies a contributing party or its representative of the commencement thereof within the aforesaid fifteen days, the contributing party will be entitled to participate therein with the notifying party and any other contributing party similarly notified. Any such contributing party shall not be liable to any party seeking contribution on account of any settlement of any claim, action or proceeding affected by such party seeking contribution without the written consent of such contributing party. The contribution provisions contained in this Section 6.4 are intended to supersede, to the extent permitted by law, any right to contribution under the Securities Act, the Exchange Act or otherwise available.

**ARTICLE VII.**

**MISCELLANEOUS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 <u>Termination</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Termination Right</u>. The Representative shall have the right to terminate this Agreement at any time prior to any Closing Date, (i) if any domestic or international event or act or occurrence has materially disrupted, or in its opinion will in the immediate future materially disrupt, general securities markets in the United States; or (ii) if trading on any Trading Market shall have been suspended or materially limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction, or (iii) if the United States shall have become involved in a new war or an increase in major hostilities, or (iv) if a banking moratorium has been declared by a New York State or federal authority, or (v) if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United States securities markets, or (vi) if the Company shall have sustained a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have been insured, will, in the Representative's opinion, make it inadvisable to proceed with the delivery of the Securities, or (vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder, or (viii) if the Representative shall have become aware after the date hereof of such a material adverse change in the conditions or prospects of the Company, or such adverse material change in general market conditions as in the Representative's judgment would make it impracticable to proceed with the offering, sale and/or delivery of the Securities or to enforce contracts made by the Underwriters for the sale of the Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Expenses</u>. In the event this Agreement shall be terminated pursuant to Section 7.1(a), within the time specified herein or any extensions thereof pursuant to the terms herein, the Company shall be obligated to pay to the Representative its actual and accountable out of pocket expenses related to the transactions contemplated herein then due and payable, including the fees and disbursements of EGS up to $25,000 (<u>provided</u>, <u>however</u>, that such expense cap in no way limits or impairs the indemnification and contribution provisions of this Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Indemnification</u>. Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of Article VI shall not be in any way effected by such election or termination or failure to carry out the terms of this Agreement or any part hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 <u>Entire Agreement</u>. The Transaction Documents, together with the exhibits and schedules thereto, the Prospectus and the Prospectus Supplement, contain the entire understanding of the parties with respect to the subject matter hereof and thereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules. Notwithstanding anything herein to the contrary, the Engagement Agreement, dated November 5, 2025 ("Engagement Agreement"), by and between the Company and the Representative, shall continue to be effective and the terms therein, including, without limitation, Sections 6, and 7, shall continue to survive and be enforceable by the Representative in accordance with its terms, provided that, in the event of a conflict between the terms of the Engagement Agreement and this Agreement, the terms of this Agreement shall prevail.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 <u>Notices</u>. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered via e-mail attachment at the email address set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the time of transmission, if such notice or communication is delivered via e-mail attachment at the e-mail address as set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2<sup>nd</sup>) Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages attached hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4 <u>Amendments; Waivers</u>. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company and the Representative. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5 <u>Headings</u>. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.6 <u>Successors and Assigns</u>. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7 <u>Governing Law</u>. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal Proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in The City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such Action or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such Action or Proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. In addition to and without limiting the foregoing, the Company hereby appoints Cogency Global Inc. as its authorized agent (the "<u>Authorized Agent</u>") upon whom process may be served in any suit, action or proceeding arising out of or based upon the this Agreement or the Transaction Documents or the transactions contemplated herein which may be instituted in any New York federal or state court, by the Representative, the directors, officers, partners, employees and agents of the Representative and each affiliate of the Representative, and expressly accept the non-exclusive jurisdiction of any such court in respect of any such suit, action or proceeding. The Company hereby represents and warrants that the Authorized Agent has accepted such appointment and has agreed to act as said agent for service of process, and the Company agrees to take any and all action, including the filing of any and all documents that may be necessary to continue such appointment in full force and effect as aforesaid. The Company hereby authorizes and directs the Authorized Agent to accept such service. Service of process upon the Authorized Agent shall be deemed, in every respect, effective service of process upon the Company. If the Authorized Agent shall cease to act as agent for service of process, the Company shall appoint, without unreasonable delay, another such agent in the United States, and notify you of such appointment. Notwithstanding the foregoing, any action arising out of or based upon this Agreement may be instituted by the Representative, the directors, officers, partners, employees and agents of the Representative and each respective affiliate of the Representative, in any court of competent jurisdiction in the Cayman Islands. This paragraph shall survive any termination of this Agreement, in whole or in part.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.8 <u>Survival</u>. The representations and warranties contained herein shall survive the Closing and the Option Closing, if any, and the delivery of the Securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.9 <u>Execution</u>. This Agreement may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to each other party, it being understood that the parties need not sign the same counterpart. In the event that any signature is delivered by e-mail delivery of a ".pdf" format data file, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such ".pdf" signature page were an original thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.10 <u>Severability</u>. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction. It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.11 <u>Remedies</u>. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, the Underwriters and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any Action for specific performance of any such obligation the defense that a remedy at law would be adequate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.12 <u>Saturdays, Sundays, Holidays, etc</u>. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.13 <u>Construction</u>. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to share prices and Ordinary Shares in any Transaction Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Ordinary Shares that occur after the date of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.14 **<u>WAIVER OF JURY TRIAL</u>. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, THE PARTIES EACH KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVE FOREVER ANY RIGHT TO TRIAL BY JURY.** 

*(Signature Pages Follow)*

If the foregoing correctly sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement among the Company and the several Underwriters in accordance with its terms.

---

| | | |
|:---|:---|:---|
| Very truly yours, | Very truly yours, | Very truly yours, |
| **U POWER LIMITED.** | **U POWER LIMITED.** | **U POWER LIMITED.** |
| By: |  |  |
|  | Name: | Jia Li |
|  | Title: | Chief Executive Officer |

---

Address for Notice:

Room 615, Lane 99, Lianxi Road,

Pudong New Area,

Shanghai, China

Attn：Bingyi Zhao

Copy to:

Hunter Taubman Fischer & Li LLC

950 Third Avenue, 19<sup>th</sup> Floor

New York, NY 10022

Attn: Ying Li

Accepted on the date first above written.

**MAXIM GROUP LLC**

As the Representative of the several

Underwriters listed on Schedule I

By: Maxim Group LLC

By:  <br> Name: <br> Title:

<br> Address for Notice:

300 Park Avenue, 16<sup>th</sup> Floor

New York, NY 10022

Attn: James Siegel

Copy to:

Ellenoff Grossman & Schole LLP

1345 Avenue of the Americas

New York, NY 10105

Attn: Matthew Bernstein

**SCHEDULE I**

Schedule of Underwriters

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Underwriters** | **Closing Shares** | **Pre-Funded Warrants** | **Closing Warrants** | **Closing Purchase Price** |
| Maxim Group LLC |  |  |  | $|
| **Total** |  |  |  | **$** |

---

## Exhibit 4.3

**Exhibit 4.3**

**CLASS A ORDINARY SHARE PURCHASE WARRANT**

**U Power Limited**

Warrant Shares: [_______] Issuance Date: ________, 2026

THIS CLASS A ORDINARY SHARE PURCHASE WARRANT (this "<u>Warrant</u>") certifies that, for value received, [_____________] or its assigns (the "<u>Holder</u>") is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date hereof (the "<u>Initial Exercise Date</u>") and on or prior to 5:00 p.m. (New York City time) on the one (1) year anniversary of the Initial Exercise Date, provided that, if such date is not a Trading Day, then the next Trading Day (the "<u>Termination Date</u>") but not thereafter, to subscribe for and purchase from U Power Limited, an exempted company existing under the laws of the Cayman Islands (the "<u>Company</u>"), up to [______] Ordinary Shares (as defined below and as subject to adjustment hereunder, the "<u>Warrant Shares</u>"). The purchase price of one Ordinary Share under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).

<u>Section 1</u>. <u>Definitions</u>. In addition to the terms defined elsewhere in this Warrant, the following terms have the meanings indicated in this Section 1:

"<u>Affiliate</u>" means any Person (as defined below) that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

"<u>Bid Price</u>" means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then listed or quoted on a Trading Market, the bid price of the Ordinary Shares for the time in question (or the nearest preceding date) on the Trading Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Ordinary Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary Shares are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported on the Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per Ordinary Share so reported, or (d) in all other cases, the fair market value of a Ordinary Share as determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

"<u>Business Day</u>" means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; <u>provided</u>, <u>however</u>, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to "stay at home", "shelter-in-place", "non-essential employee" or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.

"<u>Commission</u>" means the United States Securities and Exchange Commission.

"<u>Exchange Act</u>" means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

"<u>Floor Price</u>" means a price equal to the greater of (i) $0.10 and (ii) 20% of the closing bid price of the Ordinary Shares on the date prior to the execution of the Underwriting Agreement.

"<u>Ordinary Shares</u>" means the Class A ordinary shares of the Company, par value $0.00001 per share, and any other class of securities into which such securities may hereafter be reclassified or changed.

"<u>Ordinary Share Equivalents</u>" means any securities of the Company or the Subsidiaries (as defined below) which would entitle the holder thereof to acquire at any time Ordinary Shares, including, without limitation, any debt, preferred shares, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Ordinary Shares.

"<u>Person</u>" means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

"<u>Registration Statement</u>" means the Company's registration statement on Form F-1 (File No. 333-______).

"<u>Reset Date</u>" means, 9:00 a.m. Eastern time on the date that is (i) _____, 2026<sup>1</sup> (the "<u>First Reset Date</u>") and (ii) _______, 2026<sup>2</sup> (the "<u>Second Reset Date</u>").

"<u>Reset Price</u>" means, on the First Reset Date, $____<sup>3</sup> and on the Second Reset Date, $_____<sup>4</sup> (in each case, as adjusted for share splits, share dividends, recapitalizations, reorganizations, reclassification, combinations, reverse share splits or other similar events occurring after the Initial Exercise Date).

"<u>Securities Act</u>" means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

"<u>Subsidiary</u>" means any subsidiary of the Company, and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

"<u>Trading Day</u>" means a day on which the Ordinary Shares are traded on a Trading Market.

"<u>Trading Market</u>" means any of the following markets or exchanges on which the Ordinary Shares are listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock Exchange (or any successors to any of the foregoing).

"<u>Transfer Agent</u>" means Transhare Corporation, the current transfer agent of the Company, with a mailing address of Bayside Center 1, 17755 North U.S. Highway 19, Suite #140, Clearwater, FL 33764, and any successor transfer agent of the Company.

"<u>VWAP</u>" means, for any date, the price determined by the first of the following clauses that applies: (a) if the Ordinary Shares are then listed or quoted on a Trading Market, the daily volume weighted average price of the Ordinary Shares for such date (or the nearest preceding date) on the Trading Market on which the Ordinary Shares are then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Ordinary Shares for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Ordinary Shares are not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Ordinary Shares are then reported on the Pink Open Market (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per Ordinary Share so reported, or (d) in all other cases, the fair market value of a Ordinary Share as determined by an independent appraiser selected in good faith by the holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.

<sup>1</sup> The Second Trading Day after Closing

<sup>2</sup> The Fifth Trading Day after Closing

<sup>3</sup> 70% of the Exercise Price

<sup>4</sup> 50% of the Exercise Price

"<u>Warrants</u>" means this Warrant and other Class A Ordinary Share purchase warrants issued by the Company pursuant to the Registration Statement.

<u>Section 2</u>. <u>Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <u>Exercise of Warrant</u>. Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed PDF copy submitted by e-mail (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the "<u>Notice of Exercise</u>"). Within the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the Warrant Shares specified in the applicable Notice of Exercise by wire transfer unless the cashless exercise (or zero cash exercise) procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise on the Trading Day of receipt of such notice. **The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <u>Exercise Price</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. The initial exercise price per Ordinary Share under this Warrant shall be $_____, subject to adjustment
hereunder, <u>provided</u>, <u>however</u>, that if on a Reset Date, the applicable Reset Price is less than the Exercise Price, the Exercise
Price shall be decreased to such Reset Price (it being understood that no adjustment shall be made if such Reset Price is equal to or
greater than the Exercise Price) (the " <u>Exercise Price</u> "). If the Exercise Price is adjusted on a Reset Date pursuant
to this paragraph, the number of Warrant Shares issuable hereunder shall be proportionately increased so that after such adjustment the
aggregate Exercise Price payable hereunder shall equal the aggregate Exercise Price of the Warrant immediately prior to such Reset Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. For the avoidance of doubt, the aggregate Exercise Price of this Warrant following any reduction in the
Exercise Price of this Warrant and corresponding increase in Warrant Shares on any Reset Date shall be equal to the aggregate Exercise
Price of this Warrant as determined as of the Closing Date, subject only to reductions in the aggregate number of Warrant Shares as a
result of exercises of this Warrant by the Holder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <u>Cashless Exercise</u>. If at the time of exercise hereof there is no effective registration statement registering, or the prospectus contained therein is not available for the issuance of the Warrant Shares to the Holder, then this Warrant may only be exercised, in whole or in part, at such time by means of a "cashless exercise" in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

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| | |
|:---|:---|
| (A) = | as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of "regular trading hours" (as defined in Rule 600(b) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) the highest Bid Price of the Ordinary Shares on the principal Trading Market as reported by Bloomberg L.P. ("<u>Bloomberg</u>") within two (2) hours of the time of the Holder's delivery of the Notice of Exercise pursuant to Section 2(a) hereof if such Notice of Exercise is delivered during "regular trading hours," or within two (2) hours after the close of "regular trading hours" on a Trading Day or (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is delivered pursuant to Section 2(a) hereof after two (2) hours following the close of "regular trading hours" on such Trading Day; |

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(B) = the Exercise Price of this Warrant, as adjusted hereunder; and

(X) = the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.

At any time after the Initial Exercise Date and whether or not an effective registration statement is available, the Holder may also effect a "zero cash exercise". In such event, the aggregate number of Warrant Shares issuable in such zero cash exercise pursuant to any given Notice of Exercise electing to effect a zero cash exercise shall equal the product of (i) the aggregate number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise, multiplied by (ii) two (2).

If Warrant Shares are issued in such a cashless exercise (or zero cash exercise), the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares being issued shall take on the registered characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 2(c).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <u>Mechanics of Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. <u>Delivery of Warrant Shares Upon Exercise</u>. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder's or its designee's balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system ("<u>DWAC</u>") if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) this Warrant is being exercised via cashless exercise or zero cash exercise, and otherwise by physical delivery of a certificate, registered in the Company's share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earlier of (i) one (1) Trading Day after the delivery to the Company of the Notice of Exercise and (ii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the "<u>Warrant Share Delivery Date</u>"), provided that the payment of the aggregate Exercise Price (other than in the instance of a cashless exercise or zero cash exercise) is received by the Company by the Warrant Share Delivery Date. Upon delivery of the Notice of Exercise, the Holder shall be deemed, solely for purposes of Regulation SHO under the Securities Act to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise or zero cash exercise) is received within the earlier of (i) one (1) Trading Day and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver or cause the delivery to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Ordinary Shares on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the third Trading Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, "<u>Standard Settlement Period</u>" means the standard settlement period, expressed in a number of Trading Days, on the Company's primary Trading Market with respect to the Ordinary Shares as in effect on the date of delivery of the Notice of Exercise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. <u>Delivery of New Warrants Upon Exercise</u>. If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iii. <u>Rescission Rights</u>. If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;iv. <u>Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise</u>. In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder's brokerage firm otherwise purchases, Ordinary Shares to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a "<u>Buy-In</u>"), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder's total purchase price (including brokerage commissions, if any) for the Ordinary Shares so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed (provided that such price is on market terms), and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of Ordinary Shares that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Ordinary Shares having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of this Warrant to purchase Ordinary Shares with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder's right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company's failure to timely deliver Ordinary Shares upon exercise of the Warrant as required pursuant to the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;v. <u>No Fractional Shares or Scrip</u>. No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall round up to the nearest whole share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vi. <u>Charges, Taxes and Expenses</u>. Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; <u>provided</u>, <u>however</u>, that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;vii. <u>Closing of Books</u>. The Company will not close its shareholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <u>Holder's Exercise Limitations</u>. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder's Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder's Affiliates (such Persons, "<u>Attribution Parties</u>")), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of Ordinary Shares beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of Ordinary Shares issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of Ordinary Shares which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other Ordinary Share Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder's determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination and a submission of a Notice of Exercise shall be deemed a representation and warranty by the Holder of the foregoing determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding Ordinary Shares, a Holder may rely on the number of outstanding Ordinary Shares as reflected in (A) the Company's most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the number of Ordinary Shares outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder the number of Ordinary Shares then outstanding. In any case, the number of outstanding Ordinary Shares shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding Ordinary Shares was reported. The "<u>Beneficial Ownership Limitation</u>" shall be [9.99/4.99%] of the number of Ordinary Shares outstanding immediately after giving effect to the issuance of Ordinary Shares issuable upon exercise of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of Ordinary Shares outstanding immediately after giving effect to the issuance of Ordinary Shares upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61<sup>st</sup> day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.

<u>Section 3</u>. <u>Certain Adjustments</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <u>Stock Dividends and Splits</u>. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions to all holders of its Ordinary Shares or any other equity or equity equivalent securities payable in Ordinary Shares (which, for avoidance of doubt, shall not include any Ordinary Shares issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding Ordinary Shares into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding Ordinary Shares into a smaller number of shares, or (iv) issues by reclassification of Ordinary Shares any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of Ordinary Shares (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of Ordinary Shares outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <u>Subsequent Rights Offerings</u>. In addition to any adjustments pursuant to Section 3(a) above, if at any time, while this Warrant is outstanding, the Company grants, issues or sells any Ordinary Share Equivalents or rights to purchase stock, warrants, securities or other property pro rata to all record holders of any class of Ordinary Shares (the "<u>Purchase Rights</u>"), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of Ordinary Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of Ordinary Shares are to be determined for the grant, issue or sale of such Purchase Rights (<u>provided</u>, <u>however</u>, that, to the extent that the Holder's right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such Ordinary Shares as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <u>Pro Rata Distributions</u>. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to all holders of Ordinary Shares, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "<u>Distribution</u>"), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of Ordinary Shares acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of Ordinary Shares are to be determined for the participation in such Distribution (<u>provided</u>, <u>however,</u> that to the extent that the Holder's right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any Ordinary Shares as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <u>Fundamental Transaction</u>. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company and all of its Subsidiaries, taken as a whole, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, other than in the ordinary course of business or in a distribution subject to Sections 3(a), (b) or (c), (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Ordinary Shares are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of greater than 50% of the outstanding Ordinary Shares or greater than 50% of the voting power of the common equity of the Company, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Ordinary Shares or any compulsory share exchange pursuant to which the Ordinary Shares are effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires greater than 50% of the outstanding Ordinary Shares or greater than 50% of the voting power of the common equity of the Company (each a "<u>Fundamental Transaction</u>"), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of Ordinary Shares of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the "<u>Alternate Consideration</u>") receivable as a result of such Fundamental Transaction by a holder of the number of Ordinary Shares for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one Ordinary Share in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Ordinary Shares are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the "<u>Successor Entity</u>") to assume in writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 3(d) pursuant to written agreements in form and substance reasonably satisfactory to Holders of a majority in interest of the Warrants (based on the number of Warrant Shares underlying such Warrants) then outstanding (as determined without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the Ordinary Shares acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the Ordinary Shares pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for, the Company under this Warrant (so that from and after the occurrence or consummation of such Fundamental Transaction, each and every provision of this Warrant referring to the "Company" shall refer instead to the Successor Entity or Successor Entities, jointly and severally), and the Successor Entity or Successor Entities may exercise every right and power of the Company prior thereto and the Successor Entity or Successor Entities shall assume all of the obligations of the Company prior thereto under this Warrant with the same effect as if such Successor Entity or Successor Entities, jointly and severally, had been named as the Company herein. For the avoidance of doubt, the Holder shall be entitled to the benefits of the provisions of this Section 3(d) regardless of (i) whether the Company has sufficient authorized Ordinary Shares for the issuance of Warrant Shares and/or (ii) whether a Fundamental Transaction occurs prior to the Initial Exercise Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <u>Calculations</u>. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of Ordinary Shares deemed to be issued and outstanding as of a given date shall be the sum of the number of Ordinary Shares (excluding treasury shares, if any) issued and outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <u>Notice to Holder</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i. <u>Adjustment to Exercise Price</u>. Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder by email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ii. <u>Notice to Allow Exercise by Holder</u>. If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Ordinary Shares, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Ordinary Shares, (C) the Company shall authorize the granting to all holders of the Ordinary Shares rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any shareholders of the Company shall be required in connection with any reclassification of the Ordinary Shares, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Ordinary Shares are converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by email to the Holder at its last email address as it shall appear upon the Warrant Register of the Company, at least ten (10) calendar days prior to the applicable record or effective date hereinafter specified, a notice (unless such information is filed with the Commission, in which case a notice shall not be required) stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Ordinary Shares of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Ordinary Shares of record shall be entitled to exchange their Ordinary Shares for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Report on Form 6-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) <u>Floor Price</u>. In no event, at any time while this Warrant is outstanding, shall the Exercise Price be adjusted to a price that is less than the Floor Price, including, for the avoidance of doubt, any adjustments provided in this Warrant.

<u>Section 4</u>. <u>Transfer of Warrant</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <u>Transferability</u>. This Warrant and all rights hereunder are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three (3) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <u>New Warrants</u>. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Initial Exercise Date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <u>Warrant Register</u>. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the "<u>Warrant Register</u>"), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

<u>Section 5</u>. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) <u>No Rights as Shareholder; No Settlement in Cash</u>. This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a shareholder of the Company prior to the issuance of Warrant Shares upon exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section 3. Without limiting any rights of a Holder to receive Warrant Shares on a "cashless exercise" (or zero cash exercise) pursuant to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company be required to net cash settle an exercise of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) <u>Loss, Theft, Destruction or Mutilation of Warrant</u>. The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) <u>Saturdays, Sundays, Holidays, etc</u>. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Trading Day, then such action may be taken or such right may be exercised on the next succeeding Trading Day.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) <u>Authorized Shares</u>.

Except and to the extent as waived or consented to by the Holders of a majority in interest of the Warrants (based on the number of Warrant Shares underlying such Warrants) then outstanding which are not beneficially owned by Affiliates of the Company, the Company shall not by any action, including, without limitation, amending its articles of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment; provided, however, that no modification of the terms (including but not limited to the adjustments described in Section 3) upon which the Warrants are exercisable or the rights of holders of Warrants to receive liquidated damages or other payments in cash from the Company or reducing the percentage required for consent to modification of this Warrant may be made without the consent of the Holder of each outstanding Warrant affected thereby. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.

Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e) <u>Jurisdiction</u>. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in The City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees that, subject to applicable law, such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an action, suit or proceeding to enforce any provisions of this Warrant, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for their reasonable attorneys' fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f) <u>Restrictions</u>. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not utilize cashless exercise or zero cash exercise, will have restrictions upon resale imposed by state and federal securities laws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g) <u>Nonwaiver and Expenses</u>. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder's rights, powers or remedies. Without limiting any other provision of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys' fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h) <u>Notices</u>. Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any Notice of Exercise, shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service, addressed to the Company, at Room 615, Lane 99, Lianxi Road, Pudong New Area, Shanghai, China, Attention: Bingyi Zhao, email address: rebecca.zhao@upincar.com, or such other email address or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service addressed to each Holder at the e-mail address or address of such Holder appearing on the books of the Company. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the time of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the time of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Report on Form 6-K.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;i) <u>Limitation of Liability</u>. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Ordinary Shares or as a shareholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;j) <u>Remedies</u>. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;k) <u>Successors and Assigns</u>. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;l) <u>Amendment</u>. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company, on the one hand, and the Holder, on the other hand.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;m) <u>Severability</u>. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;n) <u>Headings</u>. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.

\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*\*

 

*(Signature Page Follows)*

 

IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.

---

| | | |
|:---|:---|:---|
| **U Power Limited** | **U Power Limited** | **U Power Limited** |
| By: |  |  |
|  | Name: | Jia Li |
|  | Title: | Chief Executive Officer |

---

**NOTICE OF EXERCISE**

To: U Power Limited

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Payment shall take the form of (check applicable box):

☐ in lawful money of the United States; or

☐ if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).

☐ no cancellation of Warrant Shares pursuant to the zero cash exercise procedure set forth in subsection 2(c).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

_______________________________

The Warrant Shares shall be delivered to the following DWAC Account Number:

_______________________________

_______________________________

_______________________________

[SIGNATURE OF HOLDER]

Name of Investing Entity: ________________________________________________________________________

*Signature of Authorized Signatory of Investing Entity*: _________________________________________________

Name of Authorized Signatory: ___________________________________________________________________

Title of Authorized Signatory: ____________________________________________________________________

Date: ________________________________________________________________________________________

**ASSIGNMENT FORM**

 

*(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)*

FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to

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| | |
|:---|:---|
| Name: | ____________________________________________ |
|  | (Please Print) |
| Address: | ____________________________________________ |
|  | (Please Print) |
| Phone Number: | ______________________________________ |
| Email Address: | ______________________________________ |
| Dated: _______________ __, ______ |  |
| Holder's Signature:_____________________________ |  |
| Holder's Address:_____________________________ |  |

---

## Exhibit 5.1

**Exhibit 5.1**

![](ea028160401_ex5-1img1.jpg)

---

| | |
|:---|:---|
| **Our ref** | VSL/797888-000002/85884693v3 |

---

U Power Limited

18/F, Building 3, Science and Technology Industrial Park

Yijiang District, Wuhu City, Anhui Province

People's Republic of China, 241003

13 March 2026

Dear Sirs

**U Power Limited**

We have acted as Cayman Islands legal advisers to U Power Limited (the "**Company**") in connection with the Company's registration statement on Form F-1, including all amendments or supplements thereto (the "**Registration Statement**"), filed with the Securities and Exchange Commission under the U.S. Securities Act of 1933, as amended relating to the offering by the Company of the following securities pursuant to the underwriting agreement to be entered into by the Company and the underwriters as named therein (the "**Underwriting Agreement**"):

&nbsp;&nbsp;&nbsp;&nbsp;(a) 9,090,909 units (each, a "**Unit**" and collectively, the "**Units**") consisting
of one Class A ordinary share of the Company of a par value of US$0.00001 each (each, a "**Class A Ordinary Share**" and
collectively, the "**Class A Ordinary Shares**") or one pre-funded warrant to purchase one Class A Ordinary share (each,
a "**Pre-funded Warrant**" and collectively, the "**Pre-funded Warrants**") and one Class A Warrant (each,
a "**Warrant**," and collectively, the "**Warrants**") to purchase one Class A Ordinary Share, at an assumed
public offering price of US$1.31 per Unit; and

&nbsp;&nbsp;&nbsp;&nbsp;(b) Class A Ordinary Shares underlying the Pre-funded Warrants and the Warrants (the "**Warrant Shares** ").

We are furnishing this opinion as Exhibit 5.1 and 23.3 to the Registration Statement.

1 Documents Reviewed

For the purposes of this opinion, we have reviewed only originals, copies or final drafts of the following documents:

1.1 The certificate of incorporation of the Company dated 17 June 2021 issued by the Registrar of Companies
in the Cayman Islands.

1.2 The third amended and restated memorandum and articles of association of the Company as adopted by a special
resolution passed on 5 December 2025 (the "**Memorandum and Articles** ").

![](ea028160401_ex5-1img2.jpg)

1.3 The written resolutions of the board of directors of the Company dated 5 March 2026 (the "**Board Resolutions** ").

1.4 A certificate of good standing dated 3 March 2026, issued by the Registrar of Companies in the Cayman
Islands (the "**Certificate of Good Standing** ").

1.5 A certificate from a director of the Company, a copy of which is attached hereto (the "**Director's Certificate** ").

1.6 The Registration Statement.

1.7 A draft form of the Pre-funded Warrants and the Warrants (together, the "**Warrant Documents** ").

1.8 A draft of the Underwriting Agreement (together with the Warrant Documents, the "**Transaction Documents** ").

2 Assumptions

The following opinions are given only as to, and based on, circumstances and matters of fact existing and known to us on the date of this opinion letter. These opinions only relate to the laws of the Cayman Islands which are in force on the date of this opinion letter. In giving these opinions we have relied (without further verification) upon the completeness and accuracy, as of the date of this opinion letter, of the Director's Certificate and the Certificate of Good Standing. We have also relied upon the following assumptions, which we have not independently verified:

2.1 Copies of documents, conformed copies or drafts of documents provided to us are true and complete copies
of, or in the final forms of, the originals.

2.2 All signatures, initials and seals are genuine.

2.3 The Transaction Documents have been or will be authorised and duly executed and unconditionally delivered
by or on behalf of all relevant parties in accordance with all relevant laws (other than, with respect to the Company, the laws of the
Cayman Islands).

2.4 The Transaction Documents are, or will be, legal, valid, binding and enforceable against all relevant
parties in accordance with their terms under the laws of the State of New York and all other relevant laws (other than, with respect to
the Company, the laws of the Cayman Islands).

2.5 The choice of the laws of the State of New York as the governing law of the Transaction Documents has
been made in good faith and would be regarded as a valid and binding selection which will be upheld by the state and federal courts sitting
in The City of New York and any other relevant jurisdiction (other than the Cayman Islands) as a matter of the laws of the State of New
York and all other relevant laws (other than the laws of the Cayman Islands).

2.6 The Company has, or will have, sufficient authorized but unissued Class A Ordinary Shares in its authorized
share capital to enable the Company to issue the Class A Ordinary Shares and the Warrant Shares upon exercise of the Warrants.

2.7 The Company will receive money or money's worth in consideration for the issue of the Class A Ordinary
Shares, and none of such Class A Ordinary Shares will be issued for less than their par value.

2.8 The capacity, power, authority and legal right of all parties under all relevant laws and regulations
(other than, with respect to the Company, the laws and regulations of the Cayman Islands) to enter into, execute, unconditionally deliver
and perform their respective obligations under the Transaction Documents.

2.9 There is no contractual or other prohibition or restriction (other than as arising under Cayman Islands
law) binding on the Company prohibiting or restricting it from entering into and performing its obligations under the Transaction Documents.

2.10 No monies paid to or for the account of any party under the Transaction Documents or any property received
or disposed of by any party to the Transaction Documents in each case in connection with the Transaction Documents or the consummation
of the transactions contemplated thereby represent or will represent proceeds of criminal conduct or criminal property or terrorist property
(as defined in the Proceeds of Crime Act (As Revised) and the Terrorism Act (As Revised), respectively).

2.11 At the time of the exercise of the Pre-funded Warrants and/or Warrants into Warrant Shares in accordance
with the terms and provisions of the Warrants (the "**Exercise** "):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the laws of the Cayman Islands (including the Companies Act (As Revised) will not have changed in such
way as to materially impact the issue of such Warrant Shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Company will have sufficient authorised but unallotted and unissued Class A Ordinary Shares, in each
case to effect the Exercise in accordance with the terms and provisions of the Pre-funded Warrants and/or Warrants, as applicable, the
then effective memorandum and articles of association of the Company and the Companies Act;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Company will not have been struck off or placed in liquidation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the issue price for each Warrant Share to be issued upon the Exercise will not be less than the par value
of such Warrant Share;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the terms and provisions of the Pre-funded Warrants and/or Warrants, as applicable, relating to the Exercise
will not have been altered, amended or restated; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) the then effective memorandum and articles of association of the Company will not contain anything which
would or might affect the opinions set out below.

2.12 There is nothing under any law (other than the laws of the Cayman Islands) which would or might affect
the opinions set out below. Specifically, we have made no independent investigation of the laws of the State of New York.

2.13 There is nothing contained in the minute book or corporate records of the Company (which we have not inspected)
which would or might affect the opinions set out below.

2.14 The issue of the Class A Ordinary Shares and the Pre-funded Warrants and Warrants under the Transaction
Documents will be of commercial benefit to the Company.

2.15 No invitation has been or will be made by or on behalf of the Company to the public in the Cayman Islands
to subscribe for any of the Class A Ordinary Shares or the Pre-funded Warrants and the Warrants.

---

| | |
|:---|:---|
| 3 | Opinion |

---

Based upon the foregoing and subject to the qualifications set out below and having regard to such legal considerations as we deem relevant, we are of the opinion that:

3.1 The Company has been duly incorporated as an exempted company with limited liability and is validly existing
and in good standing with the Registrar of Companies under the laws of the Cayman Islands.

3.2 The authorised share capital of the Company is US$50,000 divided into 5,000,000,000 ordinary shares comprised
of (i) 3,999,411,812 Class A Ordinary Shares of a par value of US$0.00001 each and (ii) 1,000,588,188 Class B Ordinary Shares of a par
value of US$0.00001 each.

3.3 The issue and allotment of the Class A Ordinary Shares (including the issue and allotment of the Class
A Ordinary Shares upon the exercise of the Pre-funded Warrants and the Warrants in accordance with the Warrants Documents) have been duly
authorised and when allotted, issued and paid for as contemplated in the Registration Statement (including the issue and allotment of
the Class A Ordinary Shares upon the exercise of the Pre-funded Warrants and the Warrants in accordance with the Warrants Documents),
the Class A Ordinary Shares will be legally issued and allotted, fully paid and non-assessable. As a matter of Cayman Islands law, a share
is only issued when it has been entered in the register of members (shareholders).

3.4 The execution, delivery and performance of the Transaction Documents have been authorised by and on behalf
of the Company and, once the Transaction Documents have been executed and delivered by any director or officer of the Company, the Transaction
Documents will be duly executed and delivered on behalf of the Company and will constitute the legal, valid and binding obligations of
the Company enforceable in accordance with their terms.

3.5 The statements under the caption "Cayman Islands Taxation" in the prospectus forming part of
the Registration Statement, to the extent that they constitute statements of Cayman Islands law, are accurate in all material respects
and that such statements constitute our opinion.

4 Qualifications

The opinions expressed above are subject to the following qualifications:

4.1 To maintain the Company in good standing under the laws of the Cayman Islands, annual filing fees must
be paid and returns made to the Registrar of Companies within the time frame prescribed by law.

4.2 The obligations assumed by the Company under the Transaction Documents will not necessarily be enforceable
in all circumstances in accordance with their terms. In particular:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) enforcement may be limited by bankruptcy, insolvency, liquidation, reorganisation, readjustment of debts
or moratorium or other laws of general application relating to, protecting or affecting the rights of creditors and/or contributories;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) enforcement may be limited by general principles of equity. For example, equitable remedies such as specific
performance may not be available, *inter alia*, where damages are considered to be an adequate remedy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) some claims may become barred under relevant statutes of limitation or may be or become subject to defences
of set off, counterclaim, estoppel and similar defences;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) where obligations are to be performed in a jurisdiction outside the Cayman Islands, they may not be enforceable
in the Cayman Islands to the extent that performance would be illegal under the laws of that jurisdiction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the courts of the Cayman Islands have jurisdiction to give judgment in the currency of the relevant obligation
and statutory rates of interest payable upon judgments will vary according to the currency of the judgment. If the Company becomes insolvent
and is made subject to a liquidation proceeding, the courts of the Cayman Islands will require all debts to be proved in a common currency,
which is likely to be the "functional currency" of the Company determined in accordance with applicable accounting principles.
Currency indemnity provisions have not been tested, so far as we are aware, in the courts of the Cayman Islands;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) arrangements that constitute penalties will not be enforceable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) enforcement may be prevented by reason of fraud, coercion, duress, undue influence, misrepresentation,
public policy or mistake or limited by the doctrine of frustration of contracts;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) provisions imposing confidentiality obligations may be overridden by compulsion of applicable law or the
requirements of legal and/or regulatory process;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the courts of the Cayman Islands may decline to exercise jurisdiction in relation to substantive proceedings
brought in matters where they determine that such proceedings may be tried in a more appropriate forum;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) we reserve our opinion as to the enforceability of the relevant provisions of the documents to the extent
that they purport to grant exclusive jurisdiction as there may be circumstances in which the courts of the Cayman Islands would accept
jurisdiction notwithstanding such provisions; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) a company cannot, by agreement or in its articles of association, restrict the exercise of a statutory
power and there is doubt as to the enforceability of any provision in the Transaction Documents whereby the Company covenants to restrict
the exercise of powers specifically given to it under the Companies Act (As Revised) of the Cayman Islands (the "**Companies Act** "),
including, without limitation, the power to increase its authorised share capital, amend its memorandum and articles of association or
present a petition to a Cayman Islands court for an order to wind up the Company.

4.3 Applicable court fees will be payable in respect of the enforcement of the Transaction Documents.

4.4 We express no opinion as to the meaning, validity or effect of any references to foreign (i.e. non-Cayman
Islands) statutes, rules, regulations, codes, judicial authority or any other promulgations and any references to them in the Transaction
Documents.

4.5 We have not reviewed the final form of any of the Transaction Documents, and our opinions are qualified
accordingly.

4.6 We reserve our opinion as to the extent to which the courts of the Cayman Islands would, in the event
of any relevant illegality or invalidity, sever the relevant provisions of the Transaction Documents and enforce the remainder or the
transaction of which such provisions form a part, notwithstanding any express provisions in this regard.

4.7 Under the Companies Act, the register of members of a Cayman Islands company is by statute regarded as
prima facie evidence of any matters which the Companies Act directs or authorises to be inserted in it. A third party interest in the
ordinary shares of the Company in question would not appear. An entry in the register of members may yield to a court order for rectification
(for example, in the event of fraud or manifest error).

4.8 In this opinion the phrase "non-assessable" means, with respect to ordinary shares of the Company,
that a shareholder shall not, solely by virtue of its status as a shareholder and in absence of a contractual arrangement, or an obligation
pursuant to the memorandum and articles of association, to the contrary, be liable for additional assessments or calls on the ordinary
shares by the Company or its creditors (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).

Except as specifically stated herein, we make no comment with respect to any representations and warranties which may be made by or with respect to the Company in any of the documents or instruments cited in this opinion or otherwise with respect to the commercial terms of the transactions, which are the subject of this opinion.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the reference to our name under the headings "Service of Process and Enforcement of Civil Liabilities" and "Legal Matters" and elsewhere in the Registration Statement. In giving such consent, we do not thereby admit that we come within the category of persons whose consent is required under Section 7 of the U.S. Securities Act of 1933, as amended, or the Rules and Regulations of the Commission thereunder.

Yours faithfully

/s/ Maples and Calder (Hong Kong) LLP

Maples and Calder (Hong Kong) LLP

**Director's Certificate**

Date: March 13, 2026

To: Maples and Calder (Hong Kong) LLP 26th Floor, Central Plaza

18 Harbour Road

Wanchai, Hong Kong

Dear Sir or Madam

**U Power Limited (the "Company")**

I, the undersigned, being a director of the Company, am aware that you are being asked to provide a legal opinion (the "**Opinion**") in relation to certain aspects of Cayman Islands law. Capitalised terms used in this certificate have the meaning given to them in the Opinion. I hereby certify that:

1 The Memorandum and Articles remain in full force and effect and are unamended.

2 The Board Resolutions were duly passed in the manner prescribed in the Memorandum and Articles (including, without limitation, with respect to the disclosure of interests (if any) by the directors of the Company) and have not been amended, varied or revoked in any respect.

---

| | |
|:---|:---|
| 3 | The authorised share capital of the Company is US$50,000 divided into 5,000,000,000 ordinary shares comprised of (i) 3,999,411,812 Class A Ordinary Shares of a par value of US$0.00001 each and (ii) 1,000,588,188 Class B Ordinary Shares of a par value of US$0.00001 each. |

---

4 The directors of the Company at the date of the Board Resolutions and at the date hereof were and are:

Li Jia

Chen Quanshi<br> Li Xiaochun <br> Zhao Bingyi

Jean Chrisophe Baron Von Pfetten

---

| | |
|:---|:---|
| 5 | Each Director considers the transactions contemplated by the Registration Statement and the Transaction Documents sto be of commercial benefit to the Company and has acted bona fide in the best interests of the Company, and for a proper purpose of the Company in relation to the transactions the subject of the Opinion. |

---

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| | |
|:---|:---|
| 6 | To the best of my knowledge and belief, having made due inquiry, the Company is not the subject of legal, arbitral, administrative or other proceedings in any jurisdiction that would have a material adverse effect on the business, properties, financial condition, results of operations or prospects of the Company, and neither the directors nor shareholders of the Company have taken any steps to have the Company struck off or placed in liquidation. Further, no steps have been taken to wind up the Company or to appoint restructuring officers or interim restructuring officers, and no receiver has been appointed in relation to any of the Company's property or assets. |

---

7 No interest in the Company constituting shares, voting rights or ultimate effective control over management in the Company is currently subject to a restrictions notice issued under the Beneficial Ownership Transparency Act (As Revised).

I confirm that you may continue to rely on this Certificate as being true and correct on the day that you issue the Opinion unless I shall have previously notified you personally to the contrary.

[*signature page follows*]

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| | |
|:---|:---|
| Signature: | /s/ Jia Li |
| Name: | Jia Li |
| Title: | Director |

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## Exhibit 5.2

**Exhibit 5.2**

![](ea028160401_ex5-2img1.jpg)

March 13, 2026

**U Power Limited**

18/F, Building 3, Science and Technology Industrial Park

Yijiang District, Wuhu City, Anhui Province

People's Republic of China, 241003

Ladies and Gentlemen:

We have acted as United States securities counsel to U Power Limited, a company incorporated under the laws of the Cayman Islands (the "Company"), in connection with the filing of a registration statement on Form F-1, including all amendments and supplements thereto (the "Registration Statement"), under the Securities Act of 1933, as amended (the "Securities Act"). The Registration Statement relates to the following securities of the Company: (i) 9,090,909 units (each, a "Unit," and, collectively, the "Units"), with each Unit consisting of (A) one Class A ordinary share, par value $0.00001 per share (each, a "Class A Ordinary Share," and, collectively, the "Class A Ordinary Shares"), or one pre-funded warrant to purchase one Class A Ordinary Share (each, a "Pre-funded Warrant," and, collectively, the "Pre-funded Warrants"), and (B) one Class A warrant to purchase one Class A Ordinary Share (each, a "Class A Warrant," and, collectively, the "Class A Warrants," and together with the Pre-funded Warrants, the "Warrants"); and (ii) up to 9,090,909 Class A Ordinary Shares underlying the Warrants (the "Warrant Shares"). The Units and Warrant Shares are collectively referred to herein as the "Securities." Capitalized terms used in this opinion letter and not otherwise defined herein shall have the respective meanings given to them in the underwriting agreement by and between the Company and Maxim Group LLC, as representative of underwriter named therein (the "Underwriting Agreement"), and Forms of Warrants (as defined below).

You have requested our opinion as to the matters set forth below in connection with the Registration Statement. For purposes of rendering that opinion, we have examined: (i) the Registration Statement and all exhibits thereto; (ii) the most recent prospectus included in the Registration Statement on file with the U.S. Securities Exchange Commission (the "Commission") as of the date of this opinion letter; (iii) a form of the Underwriting Agreement; (iv) a form of the Class A Warrant; (v) a form of the Pre-funded Warrant (together with the form of the Class A Warrant, the "Forms of Warrants"); and (vi) the records of corporate actions of the Company relating to the Registration Statement, the Underwriting Agreement, and the Warrants and matters in connection therewith. We have also made such other investigation as we have deemed appropriate. We have examined and relied upon certificates of public officials and, as to certain matters of fact that are material to our opinion, we have also relied on certificates of officers of the Company.

In rendering the opinions set forth below, we have assumed that (i) all information contained in all documents reviewed by us is true and correct; (ii) all signatures on all documents examined by us are genuine; (iii) all documents submitted to us as originals are authentic and all documents submitted to us as copies conform to the authentic originals of such documents; (iv) each natural person signing any document reviewed by us had the legal capacity to do so; and (v) the certificates representing the Securities will be duly executed and delivered.

We have also assumed that (i) the Company has been duly incorporated, and is validly existing and in good standing; (ii) the Company has requisite legal status and legal capacity under the laws of the jurisdiction of its incorporation; (iii) the Company has complied and will comply with all aspects of the laws of the jurisdiction of its incorporation, in connection with the transactions contemplated by, and the performance of its obligations under the Warrants; (iv) the Company has the corporate power and authority to execute, deliver and perform all its obligations under the Warrants; (v) as provided in Section 5(e) of the Form of Pre-funded Warrant and Section 5(e) of the Form of Class A Warrant, all questions concerning the construction, validity, enforcement and interpretation of the Warrants shall be governed by the internal laws of the State of New York, without regard to the principles of conflicts of law thereof; (vi) service of process will be effected in the manner and pursuant to the methods of the State of New York at the time such service is effected; and (vii) at the time of exercise of the Warrants, a sufficient number of Class A Ordinary Shares that have been reserved by the Company's board of directors or a duly authorized committee thereof will be authorized and available for issuance and that the consideration for the issuance and sale of the Class A Ordinary Shares in connection with such exercise is in an amount that is not less than the par value of such Class A Ordinary Shares.

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![](ea028160401_ex5-2img1.jpg)

The opinion is limited to (a) the federal laws of the United States of America and (b) the laws of the State of New York that, in either case and based on our experience, are applicable to transactions of the type contemplated by the Underwriting Agreement and the Warrants. We are members of the Bar of the State of New York. We do not hold ourselves out as being conversant with, or expressing any opinion with respect to, the laws of any jurisdiction other than the federal laws of the United States of America and the laws of the State of New York. Accordingly, the opinions expressed herein are expressly limited to the federal laws of the United States of America and the laws of the State of New York.

Except as expressly set forth in this opinion letter, we are not opining on specialized laws that are not customarily covered in opinion letters of this kind, such as tax, insolvency, antitrust, pension, employee benefit, environmental, intellectual property, banking, consumer lending, insurance, labor, health and safety, anti-money laundering, anti-terrorism, and state securities laws, or on the rules of any self-regulatory organization, securities exchange, contract market, clearing organization, or other platform, vehicle, or market for trading, processing, clearing, or reporting transactions. We are not opining on any other law or the law of any other jurisdiction, including any foreign jurisdiction or any county, municipality, or other political subdivision or local governmental agency or authority.

Based upon and subject to the foregoing, we are of the opinion that (i) when the Units have been duly executed and delivered by the Company against payment of the consideration therefor pursuant to the Underwriting Agreement, such Units will constitute binding obligations of the Company, enforceable against the Company in accordance with the respective terms of the Class A Ordinary Shares and the Warrants; and (ii) when the Warrants included in the Units have been duly executed and delivered by the Company against payment of the consideration therefor pursuant to the Underwriting Agreement, such Warrants will constitute binding obligations of the Company, enforceable against the Company in accordance with their terms.

Our opinions set forth above with respect to the validity or binding effect of any security or obligation may be limited by (i) bankruptcy, insolvency, reorganization, fraudulent conveyance, marshaling, moratorium or other similar laws affecting the enforcement generally of the rights and remedies of creditors and secured parties or the obligations of debtors, (ii) general principles of equity (whether considered in a proceeding in equity or at law), including, but not limited to, principles limiting the availability of specific performance or injunctive relief, and concepts of materiality, reasonableness, good faith and fair dealing, (iii) the possible unenforceability under certain circumstances of provisions providing for indemnification, contribution, exculpation, release or waiver that may be contrary to public policy or violative of federal or state securities laws, rules or regulations, and (iv) the effect of course of dealing, course of performance, oral agreements or the like that would modify the terms of an agreement or the respective rights or obligations of the parties under an agreement.

This opinion letter speaks only as of the date hereof and we assume no obligation to update or supplement this opinion letter if any applicable laws change after the date of this opinion letter or if we become aware after the date of this opinion letter of any facts, whether existing before or arising after the date hereof, that might change the opinions expressed above.

This opinion letter is furnished in connection with the Registration Statement and may not be relied upon for any other purpose without our prior written consent in each instance. Further, no portion of this letter may be quoted, circulated or referred to in any other document for any other purpose without our prior written consent.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of our name as it appears under the caption "Legal Matters" in the Registration Statement. In giving such consent, we do not thereby admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission promulgated thereunder.

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| | |
|:---|:---|
|  | Very truly yours, |
| | *<u>/s/ HUNTER TAUBMAN FISCHER & LI LLC</u>* |
|  | HUNTER TAUBMAN FISCHER & LI LLC |

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www.htflawyers.com \| info@htflawyers.com

950 Third Avenue, 19th Floor - New York, NY 10022 \| Office: (212) 530-2210 \| Fax: (212) 202-6380