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Item 9A. Controls and Procedures

2021-08-16 compared with 2020-03-31 · 986 added, 1064 removed, 261 unchanged (89% of the section changed)

CONTROLS AND PROCEDURES.

Controls and Procedures

management, under the supervision and with the participation of our Chief Executive Officer (“CEO”) and Chief Financial

Officer (“CFO”), has evaluated the effectiveness of our disclosure controls and procedures as defined in SEC Rules

13a-15(e) and 15d-15(e) as of the end of the period covered by this Annual Report.

Our disclosure controls and procedures are

designed to ensure that information required to be disclosed in the reports we file or submit under the Securities Exchange Act

of 1934 (“Exchange Act”) is recorded, processed, summarized, and reported within the time periods specified in the

SEC’s rules and forms, and that such information is accumulated and communicated to our management including our CEO and

CFO, to allow timely decisions regarding required disclosures.

on their evaluation, our CEO and CFO have concluded that, as of December 31, 2019, our disclosure controls and procedures were

not effective.

Report on Internal Control over Financial Reporting

management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is

defined in Exchange Act Rules 13a-15(f) and 15d-15(f).

Our internal control over financial reporting was designed to provide reasonable

assurance to the Company’s management and board of directors regarding the preparation and fair presentation of published

consolidated financial statements.

Internal control over financial reporting is promulgated under the Exchange Act as a process

designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected

by the Company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability

of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted

accounting principles.

Internal control over financial reporting, no matter how well designed, has inherent limitations and may

not prevent or detect misstatements.

Therefore, even effective internal control over financial reporting can only provide reasonable

assurance with respect to the financial statement preparation and presentation.

management has conducted, with the participation of our CEO and CFO, an assessment, including testing of the effectiveness, of

our internal control over financial reporting as of December 31, 2019.

Management’s assessment of internal control over

financial reporting was conducted using the criteria in Internal Control - Integrated Framework 2013 issued by the Committee of

Sponsoring Organizations of the Treadway Commission (COSO).

Based on such evaluation, management identified deficiencies that

were determined to be a material weakness.

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 the company’s annual or interim financial statements will not

be prevented or detected on a timely basis.

Because of the material weakness described below, management concluded that our

internal controls over financial reporting were not effective as of December 31, 2019.

specific material weakness identified by the Company’s management as of December 31, 2019 is described as follows:

did not have sufficient skilled accounting personnel that are either qualified as Certified Public Accountants in the U.S.

that have received education from U.S.

institutions or other educational programs that would provide enough relevant education

relating to U.S.

The Company’s CFO and Financial Manager have worked for U.S.

listed companies but have limited experience

Disclosure Controls and Procedures

Our management, under the

supervision and with the participation of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”),

has evaluated the effectiveness of our disclosure controls and procedures as defined in SEC Rules 13a-15(e) and 15d-15(e) as of the end

of the period covered by this Annual Report.

Our disclosure controls and procedures are designed to ensure that information required to

be disclosed in the Reports we file or submit under the Securities Exchange Act of 1934 (“Exchange Act”) is recorded, processed,

summarized, and Reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated

and communicated to our management including our CEO and CFO, to allow timely decisions regarding required disclosures.

Based on their evaluation,

our CEO and CFO have concluded that, as of December 31, 2020, our disclosure controls and procedures were not effective.

Management Report on Internal Control over Financial Reporting

Our management is responsible

for establishing and maintaining adequate internal control over financial Reporting, as such term is defined in Exchange Act Rules 13a-15(f)

and 15d-15(f).

Our internal control over financial Reporting was designed to provide reasonable assurance to the Company’s management

and board of directors regarding the preparation and fair presentation of published consolidated financial statements.

Internal control

over financial Reporting is promulgated under the Exchange Act as a process designed by, or under the supervision of, the Company’s

principal executive and principal financial officers and effected by the Company’s board of directors, management and other personnel,

to provide reasonable assurance regarding the reliability of financial Reporting and the preparation of financial statements for external

purposes in accordance with generally accepted accounting principles.

Internal control over financial Reporting, no matter how well designed,

has inherent limitations and may not prevent or detect misstatements.

Therefore, even effective internal control over financial Reporting

can only provide reasonable assurance with respect to the financial statement preparation and presentation.

Our management has conducted,

with the participation of our CEO and CFO, an assessment, including testing of the effectiveness, of our internal control over financial

Reporting as of December 31, 2020.

Management’s assessment of internal control over financial Reporting was conducted using the

criteria in Internal Control - Integrated Framework 2013 issued by the Committee of Sponsoring Organizations of the Treadway Commission

Based on such evaluation, management identified deficiencies that were determined to be a material weakness.

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 the company’s annual or interim financial statements will not be prevented or detected on a timely basis.

of the material weakness described below, management concluded that our internal controls over financial Reporting were not effective

as of December 31, 2020.

The specific material weakness

identified by the Company’s management as of December 31, 2020 is described as follows:

We did not have sufficient

skilled accounting personnel that are either qualified as Certified Public Accountants in the U.S.

or that have received education from

institutions or other educational programs that would provide enough relevant education relating to U.S.

The Company’s

CFO and Financial Manager have worked for U.S.

listed companies but have limited experience with U.S.

GAAP and are not U.S.

Certified Public Accountants.

Further, our operating subsidiaries are based in China, and in accordance

with PRC laws and regulations, are required to comply with PRC GAAP, rather than U.S.

Thus, the accounting skills and understanding

necessary to fulfill the requirements of U.S.

GAAP-based reporting, including the preparation of consolidated financial statements,

are inadequate, and determined to be a material weakness.

Additionally, we currently do not have a functional audit committee

or qualified independent directors working as our directors.

members of our audit committee resigned at September 2013, we do not have an audit committee at the present time.

of directors serves as our audit committee to analyze and evaluate our financial statements and understanding internal

controls and procedures for financial reporting.

Our board of directors has limited experience with U.S.

the importance of good corporate governance and intend to appoint an audit committee comprised entirely of independent

directors, including at least one financial expert, in the near future.

are in the process of training program in the principles and rules of U.S.

GAAP, SEC reporting requirements and the application

The program is provided by an independent training institution, for our finance and accounting personnel, including

our Chief Financial Officer, Financial Manager and others.

have a regular program to provide ongoing company-wide training regarding the Company’s internal controls, with particular

emphasis on our finance and accounting staff.

have implemented an internal review process over financial reporting to review all recent accounting pronouncements and to

verify that the accounting treatment identified in such report have been fully implemented and confirmed by our internal control

the material weakness and deficiencies reported above, our management believes that our consolidated financial statements included

in this report fairly present in all material respects our financial condition, results of operations and cash flows for the periods

presented and that this report does not contain any untrue statement of a material fact or omit to state a material fact necessary

to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect

to the period covered by this report.

Annual Report does not include an attestation report of our registered public accounting firm regarding internal control over

financial reporting.

Management’s report was not subject to attestation by our registered public accounting firm pursuant

to temporary rules of the SEC that permit us to provide only management’s report in this Annual Report.

in Internal Control over Financial Reporting

were no significant changes in our internal controls over financial reporting that occurred for the year ended December 31, 2019,

that have materially affected, or are reasonably like to materially affect, our internal controls over financial reporting.

Public Accountants.

Further, our operating subsidiaries are based in China, and in accordance with PRC laws and regulations, are required

to comply with PRC GAAP, rather than U.S.

Thus, the accounting skills and understanding necessary to fulfill the requirements of

GAAP-based Reporting, including the preparation of consolidated financial statements, are inadequate, and determined to be a material

Remediation Initiative

We have started a training program in the principles and rules of U.S.

GAAP, SEC reporting requirements and the application thereof.

The program is provided by an independent training institution, for our finance and accounting personnel, including our Chief Financial Officer, Financial Manager and others.

We are in the process of designing a program to provide ongoing company-wide training regarding the Company’s internal controls, with particular emphasis on our finance and accounting staff.

In 2011 we established the position of internal audit manager.

From September 2011 to July 2012, we hired an internal audit manager who implemented an internal review process over financial reporting to review all recent accounting pronouncements and to verify that the accounting treatments identified in such report have been fully implemented and confirmed by our internal control department.

We believe that the foregoing

steps will remediate the significant deficiencies identified above, and we will continue to monitor the effectiveness of these steps and

make any changes that our management deems appropriate.

Because of its inherent limitations,

internal control over financial reporting may not prevent or detect misstatements.

Projections of any evaluation of effectiveness to future

periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance

with the policies or procedures may deteriorate.

All internal control systems, no matter how well designed, have inherent limitations.

Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation

and presentation.

Despite the material weakness

and deficiencies Reported above, our management believes that our consolidated financial statements included in this Report fairly present

in all material respects our financial condition, results of operations and cash flows for the periods presented and that this Report

does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light

of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report.

This Annual Report does not

include an attestation Report of our registered public accounting firm regarding internal control over financial Reporting.

Management’s

Report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to

provide only management’s Report in this Annual Report.

Changes in Internal Control over Financial Reporting

There were no significant

changes in our internal controls over financial Reporting that occurred for the year ended December 31, 2020, that have materially affected,

or are reasonably like to materially affect, our internal controls over financial Reporting.

OTHER INFORMATION.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Board of Directors

Board of Directors is presently composed of three members:

DIRECTORS, EXECUTIVE OFFICERS

AND CORPORATE GOVERNANCE.

Our Board of Directors

The Board of Directors is

presently composed of three members:

Jinghe Zhang, Jun Pang and Haibo Fan.

Zhang serves as Chairman

of the Board of Directors.

On November 27, 2018, the Board of Directors appointed Jun Pang and Haibo Fan as directors of the Company.

Zhang serves as Chairman of the Board of Directors.

November 27, 2018, the Board of Directors appointed Jun Pang and Haibo Fan as directors of the Company.

The Board determined that Mr.

Fan are independent directors within the meaning set forth in the rules and regulations

of the SEC, as currently in effect.

Fan are independent directors within the meaning set forth in the rules and regulations of the SEC, as currently in effect.

There are no family relationships between any director and executive officer.

following table sets forth certain information concerning our directors:

The following table sets forth

certain information concerning our current directors:

Director Since

Chief Executive Officer, and Director

following is a summary of the biographical information of our directors:

ZHANG, age 54, is the founder of Tianjin Joway Shengshi.

Zhang has extensive experience in business management and product

He has served as Chairman of the Board and CEO for Joway Shengshi since its incorporation in 2007.

Since January 2005

he has served as the Chairman and general manager for Shenyang Joway.

From May 2003 to December 2004, he served as Chairman and

general manager of Shenyang Dazhou Healthcare Products Co., Ltd.

He headed the marketing department of Tianjin Tianshi Biological

Engineering Co., Ltd.

President, Chief Executive Officer, Chairman and Director

Independent Director

The following is a summary

of the biographical information of our directors:

JINGHE ZHANG, age 55, is the

founder of Tianjin Joway Shengshi.

Zhang has extensive experience in business management and product marketing.

He has served as Chairman

of the Board and CEO for Joway Shengshi since its incorporation in 2007.

Since January 2005 he has served as the Chairman and general

manager for Shenyang Joway.

From May 2003 to December 2004, he served as Chairman and general manager of Shenyang Dazhou Healthcare Products

He headed the marketing department of Tianjin Tianshi Biological Engineering Co., Ltd.

from July 2000 to May 2003.

From July 1988 to July 2000, he was employed as sales manager by Tianjin Hardware

Procurement & Supply Station.

Zhang received his bachelor degree in economics from Tianjin University of Finance and Economics

in July 1988.

Pang, age 48, was appointed to the Company’s Board of Directors on November 27, 2018.

Pang has been the Purchasing and

Logistics Manager for Evonik Specialty Chemicals (Jilin) Co., Ltd., where he has served as such since 2013.

Prior to transitioning

to his current role, Mr.

Pang served since 2004 as purchasing manager, and from 2004 to 2010 he was also logistics manager for

BASF Petrochina Pentyl Glycol Co., Ltd.

Fan, age 47, was appointed to the Company’s Board of Directors on November 27, 2018.

Fan has been the financial controller

for Jilin Petrochemical Co., Ltd.

1988 to July 2000, he was employed as sales manager by Tianjin Hardware Procurement & Supply Station.

Zhang received his bachelor

degree in economics from Tianjin University of Finance and Economics in July 1988.

Jun Pang, age 49, was appointed

to the Company’s Board of Directors on November 27, 2018.

Pang has been the Purchasing and Logistics Manager for Evonik Specialty

Chemicals (Jilin) Co., Ltd., where he has served as such since 2013.

Prior to transitioning to his current role, Mr.

Pang served since

2004 as purchasing manager, and from 2004 to 2010 he was also logistics manager for BASF Petrochina Pentyl Glycol Co., Ltd.

Jun Pang resigned as a director

of the Company effective as of April 29, 2021.

Haibo Fan, age 48, was appointed

to the Company’s Board of Directors on November 27, 2018.

Fan has been the financial controller for Jilin Petrochemical Co.,

(“Jilin”), where he has served in that role since October 2007.

He previously served

as Jilin’s vice chief in the budget and internal accounting control departments from May 2003 until becoming Jilin’s

financial controller in October 2007.

From March 2002 to May 2003, Mr.

Fan served as director of investment in the office of the

Secretary of the Board of China Petroleum Jilin Chemical Engineering & Construction Co., Ltd.

directors hold their position until the next annual meeting of shareholders and until their successors are elected and qualified

by our shareholders, or until earlier death, retirement, resignation or removal.

in Certain Legal Proceedings

our knowledge, during the last ten years, none of our directors and executive officers (including those of our subsidiaries) has:

a bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either

at the time of the bankruptcy or within two years prior to that time.

convicted in a criminal proceeding or been subject to a pending criminal proceeding, excluding traffic violations and other

minor offenses.

subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction,

permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities

or banking activities.

found by a court of competent jurisdiction (in a civil action), the SEC, or the Commodities Futures Trading Commission to

have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.

the subject to, or a party to, any sanction or order, not subsequently reverse, suspended or vacated, of any self-regulatory

organization, any registered entity, or any equivalent exchange, association, entity or organization that has disciplinary

authority over its members or persons associated with a member.

do not presently have an audit committee.

He previously served as Jilin’s vice chief in the

budget and internal accounting control departments from May 2003 until becoming Jilin’s financial controller in October 2007.

March 2002 to May 2003, Mr.

Fan served as director of investment in the office of the Secretary of the Board of China Petroleum Jilin

Chemical Engineering & Construction Co., Ltd.

Haibo Fan resigned as a director

of the Company effective as of April 29, 2021.

Our directors hold their position

until the next annual meeting of shareholders and until their successors are elected and qualified by our shareholders, or until earlier

death, retirement, resignation or removal.

Involvement in Certain Legal Proceedings

To our knowledge, during the

last ten years, none of our directors and executive officers (including those of our subsidiaries) has:

Had a bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time.

Been convicted in a criminal proceeding or been subject to a pending criminal proceeding, excluding traffic violations and other minor offenses.

Been subject to any order, judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities.

Been found by a court of competent jurisdiction (in a civil action), the SEC, or the Commodities Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated.

Been the subject to, or a party to, any sanction or order, not subsequently reverse, suspended or vacated, of any self-regulatory organization, any registered entity, or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

Audit Committee

We do not presently have an

audit committee.

Our Board of Directors currently acts as our audit committee.

do not presently have a compensation committee.

Compensation Committee

We do not presently have a

compensation committee.

Our Board of Directors currently acts as our compensation committee.

do not presently have a nominating committee.

Nominating Committee

We do not presently have a

nominating committee.

Our Board of Directors currently acts as our nominating committee.

May 11, 2012, our Board of Directors approved a renewed Code of Ethics which is applicable to our officers and senior executives,

which include our Chief Financial Officer, Treasurer and Chief Accounting Officer.

This Code embodies our commitment to conduct

business in accordance with the highest ethical standards and applicable laws, rules and regulations.

The Company has posted the

text of the Code of Ethics on its Internet Website www.jowayhealth.com.

We will provide any person a copy of our Code of Ethics,

without charge, upon written request to the Company’s Secretary.

Requests should be addressed in writing to Jinghe Zhang

19, Baowang Road, Baodi Economic Development Zone, Tianjin, PRC 301800).

Executive Officers and Other Significant Employees

forth below is information regarding our executive and certain key officers, including officers of our operating subsidiaries.

President and Chief Executive Officer and Chairman of the Board

Code of Ethics

On May 11, 2012, our Board

of Directors approved a renewed Code of Ethics which is applicable to our officers and senior executives, which include our Chief Financial

Officer, Treasurer and Chief Accounting Officer.

This Code embodies our commitment to conduct business in accordance with the highest

ethical standards and applicable laws, rules and regulations.

We will provide any person a copy of our Code of Ethics, without charge,

upon written request to the Company’s Secretary.

Requests should be addressed in writing to Jinghe Zhang (No.

19, Baowang Road,

Baodi Economic Development Zone, Tianjin, PRC 301800).

Our Executive Officers and Other Significant Employees

Set forth below is information

regarding our current executive and certain key officers, including officers of our operating subsidiaries.

President, Chief Executive Officer, Chairman of the Board and Director

Chief Financial Officer, Secretary and Treasurer

ZHANG is the founder of Joway Shengshi.

JINGHE ZHANG is

the founder of Joway Shengshi.

Zhang has extensive experience in business management and product marketing.

He has served as Chairman of the Board and CEO for Joway Shengshi since its incorporation in 2007.

Since January 2005 he has served

as the Chairman and general manager for Shenyang Joway.

From May 2003 to December 2004, he served as Chairman and general manager

of Shenyang Dazhou Healthcare Products Co., Ltd.

He headed the marketing department of Tianjin Tianshi Biological Engineering

He has served as

Chairman of the Board and CEO for Joway Shengshi since its incorporation in 2007.

Since January 2005 he has served as the Chairman and

general manager for Shenyang Joway.

From May 2003 to December 2004, he served as Chairman and general manager of Shenyang Dazhou Healthcare

Products Co., Ltd.

He headed the marketing department of Tianjin Tianshi Biological Engineering Co., Ltd.

from July 2000 to May 2003.

From July 1988 to July 2000, he was employed as sales manager by Tianjin Hardware Procurement &

Supply Station.

Zhang received his bachelor degree in economics from Tianjin University of Finance and Economics in July

HUANG has served as the Chief Financial Officer of Joway Shengshi since September 2009.

Prior to his appointment as Joway

Shengshi’s Chief Financial Officer, he was a Senior Financial Manager of Tianjin Tianshi Group Co., Ltd.

from September

2005 to August 2009.

From November 2003 to July 2005, he served asa financial manager of Herbie (Tianjin) Electronics Co., Ltd.

From December 1998 to November 2003, he served as Section Chief of the Budget Department of Bridgestone Tires (Tianjin)

Huang received his master degree and bachelor degree in accounting from Tianjin University of Finance and Economics

in July 2009 and July 1993, respectively.

From July 1988 to July 2000, he was employed as sales manager by Tianjin Hardware Procurement & Supply Station.

received his bachelor degree in economics from Tianjin University of Finance and Economics in July 1988.

YUAN HUANG has

served as the Chief Financial Officer of Joway Shengshi since September 2009.

Prior to his appointment as Joway Shengshi’s Chief

Financial Officer, he was a Senior Financial Manager of Tianjin Tianshi Group Co., Ltd.

from September 2005 to August 2009.

From November

2003 to July 2005, he served as financial manager of Herbie (Tianjin) Electronics Co., Ltd.

From December 1998 to November

2003, he served as Section Chief of the Budget Department of Bridgestone Tires (Tianjin) Co., Ltd.

Huang received his master

degree and bachelor degree in accounting from Tianjin University of Finance and Economics in July 2009 and July 1993, respectively.

EXECUTIVE COMPENSATION.

Officer Compensation

following is a summary of the compensation we paid to our Chief Executive Officer for the fiscal years ended December 31, 2019

This includes all compensation, including any compensation paid to our Chief Executive Officer by any of our subsidiaries.

No executive officer received compensation in excess of $100,000 in 2019 or 2018.

Compensation Table

Name and principal position

Executive Officer Compensation

The following is a summary

of the compensation we paid to our Chief Executive Officers for the fiscal years ended December 31, 2020 and 2019.

This includes all compensation,

including any compensation paid to our Chief Executive Officers by any of our subsidiaries.

No executive officer received compensation

in excess of $100,000 in 2020 or 2019.

Summary Compensation Table

principal position

Option awards

Non-equity incentive plan compensation

Nonqualified deferred compensation earnings

All other compensation

President, Chief Executive Officer

amount of $31,311 in the table above represents the compensation received by Mr.

for the entire year of 2019.

amount of $32,655 in the table above represents the compensation received by Mr.

for the entire year of 2018.

Agreements with Executive Management

September 28, 2010, we entered into an employment agreement with each of Mr.

Non-equity incentive plan

Jinghe Zhang President, Chief Executive Officer

The amount of $21,500 in the table above represents the compensation received by Mr.

Zhang for the entire year of 2020.

The amount of $31,311 in the table above represents the compensation received by Mr.

Zhang for the entire year of 2019.

Employment Agreements with Executive Management

On September 28, 2010, we

entered into an employment agreement with each of Mr.

Jinghe Zhang and Mr.

Under their respective

agreements, Mr.

Jinghe Zhang is employed as our President and Chief Executive Officer for a term of three years at a monthly salary

of RMB 7,000 (approximately $1,070), and Yuan Huang is employed as our Chief Financial Officer, Secretary and Treasurer for a

term of three years and a monthly salary of RMB 5,000 (approximately $746).

These employment agreements were renewed on September

28, 2013, 2016 and 2019 for the same terms.

Pursuant to these agreements, neither party may terminate the employment agreement

without cause.

were no stock options and no common shares set aside for any stock option plan as of December 31, 2019.

Option Exercises and Fiscal Year-End Option Value Table

were no stock options exercised during the fiscal year ended December 31, 2019, by the executive officer named in the Executive

Compensation Table.

Incentive Plan (“LTIP”) Awards Table

were no awards made to a named executive officer in the last completed fiscal year under any LTIP.

November 27, 2018, the Board of Directors appointed Jun Pang and Haibo Fan as directors of the Company.

In connection with the

appointment of the new directors to the Board, the Company has agreed to pay (i) Jun Pang annual cash compensation in the amount

and (ii) Haibo Fan annual cash compensation in the amount of $12,000.

The following is a summary of the compensation

we paid to our directors for the fiscal year ended December 31, 2019.

Under their respective agreements, Mr.

is employed as our President and Chief Executive Officer for a term of three years at a monthly salary of RMB 7,000 (approximately $1,070),

and Yuan Huang is employed as our Chief Financial Officer, Secretary and Treasurer for a term of three years and a monthly salary of RMB

5,000 (approximately $746).

These employment agreements were renewed on September 28, 2013, 2016 and 2019 for the same terms.

to these agreements, neither party may terminate the employment agreement without cause.

There were no stock options

and no common shares set aside for any stock option plan as of December 31, 2020.

Aggregated Option Exercises and Fiscal Year-End

Option Value Table

There were no stock options

exercised during the fiscal year ended December 31, 2020, by the executive officer named in the Executive Compensation Table.

Long-Term Incentive Plan (“LTIP”)

There were no awards made

to a named executive officer in the last completed fiscal year under any LTIP.

Director Compensation

On November 27, 2018, the

Board of Directors appointed Jun Pang and Haibo Fan as independent directors of the Company.

In connection with the appointment of the

new directors to the Board, the Company has agreed to pay (i) Jun Pang annual cash compensation in the amount of $12,000;

and (ii) Haibo

Fan annual cash compensation in the amount of $12,000.

The following is a summary of the compensation to our directors for the fiscal

year ended December 31, 2020.

Director Compensation

Fees earned or paid in cash

4 unchanged sentences

All other compensation

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

OWNERSHIP OF CERTAIN BENEFICIAL

AND MANAGEMENT

following table sets forth information regarding beneficial ownership of our common stock as of March 31, 2018 (i) by each

person who is known by us to beneficially own more than 5% of our common stock;

Each of Messrs.

Pang and Fan resigned as directors of the Company

effective as of April 29, 2021.

SECURITY OWNERSHIP OF CERTAIN

BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL

OWNERS AND MANAGEMENT

The following table sets forth

information regarding beneficial ownership of our common stock as of August 5, 2021 (i) by each person who is known by us to beneficially

own more than 5% of our common stock;

(ii) by each of our officers and directors;

and (iii) by all of our officers and directors as a group.

Unless otherwise indicated, the address of each listed stockholder

is c/o Joway Health, Inc., No.

19Baowang Road, Baodi Economic Development Zone, Tianjin City, PRC 300180.

and (iii) by all of our officers and directors

Unless otherwise indicated, the address of each listed stockholder is c/o Joway Health, Inc., No.

19 Baowang Road, Baodi

Economic Development Zone, Tianjin City, PRC 300180.

Name and Address

8 unchanged sentences

All directors and executive officers (2 persons)

1% of the issued and outstanding shares as of April 1, 2019.

determining beneficial ownership of our common stock as of a given date, the number of shares shown includes shares of common

stock which may be acquired on exercise of warrants or options or conversion of convertible securities within 60 days of that

In determining the percent of common stock owned by a person or entity on March 30, 2020, (a) the numerator is

the number of shares of the class beneficially owned by such person or entity, including shares which may be acquired within

60 days on exercise of warrants or options and conversion of convertible securities, and (b) the denominator is the sum

of (i) the total shares of common stock outstanding on March 30, 2020(20,054,000), and (ii) the total number of

shares that the beneficial owner may acquire upon conversion of the preferred and on exercise of the warrants and options,

subject to limitations on conversion and exercise.

Unless otherwise stated, each beneficial owner has sole power to vote and

dispose of its shares.

Globe holds a total of 17,408,000 shares of the Company’s common stock.

As the shareholder and executive director of

Crystal Globe, Mr.

Under 1% of the issued and outstanding shares as of August 5, 2021.

In determining beneficial ownership of our common stock as of a given date, the number of shares shown includes shares of common stock which may be acquired on exercise of warrants or options or conversion of convertible securities within 60 days of that date.

In determining the percent of common stock owned by a person or entity on August 5, 2021, (a) the numerator is the number of shares of the class beneficially owned by such person or entity, including shares which may be acquired within 60 days on exercise of warrants or options and conversion of convertible securities, and (b) the denominator is the sum of (i) the total shares of common stock outstanding on August 5, 2021, and (ii) the total number of shares that the beneficial owner may acquire upon conversion of the preferred and on exercise of the warrants and options, subject to limitations on conversion and exercise.

Unless otherwise stated, each beneficial owner has sole power to vote and dispose of its shares.

Crystal Globe holds a total of 17,408,000 shares of the Company’s common stock.

As the shareholder and executive director of Crystal Globe, Mr.

Zhang is the beneficial owner of the shares of the Company held by Crystal Globe.

17,408,000 shares held by Crystal Globe Ltd.

Zhang is the shareholder and executive director of Crystal Globe and as such

has voting and dispositive control over the shares held by Crystal Globe.

CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE.

following are transactions for the last two completed fiscal years and any currently proposed transaction, in which the registrant

was or is to be a participant and the amount involved exceeds the less of $120,000 or one percent of the average of the registrant’s

total assets at December 31, 2019 and 2018, and in which any of the following persons had or will have a direct or indirect material

Includes 17,408,000 shares held by Crystal Globe Ltd.

Zhang is the shareholder and executive director of Crystal Globe and as such has voting and dispositive control over the shares held by Crystal Globe.

CERTAIN RELATIONSHIPS, RELATED TRANSACTIONS, AND DIRECTOR

INDEPENDENCE.

The following are transactions

for the last two completed fiscal years and any currently proposed transaction, in which the registrant was or is to be a participant

and the amount involved exceeds the less of $120,000 or one percent of the average of the registrant’s total assets at December

31, 2020 and 2019, and in which any of the following persons had or will have a direct or indirect material interest.

director or executive officer;

immediate family member of a director or executive officer, which means any child, stepchild, parent, stepparent, spouse,

sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law of such director, executive

officer and any person (other than a tenant or employee) sharing the household of such director or executive officer;

person who was in any of the following categories when a transaction in which such person had a direct or indirect material

interest occurred or existed:

person who is known to the registrant to be the beneficial owner of more than five percent of any class of the registrant’s

voting securities;

immediate family member of any such security holder, which means any child, stepchild, parent, stepparent, spouse, sibling,

mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law of such security holder, and any

person (other than a tenant or employee) sharing the household of such security holder.

with Shenyang Joway

Joway was formed in 2005 in Shenyang, China by Mr.

Jinghe Zhang and three other individuals.

Zhang holds more than 50% of

the equity in Shenyang Joway.

Shenyang Joway was in the business of marketing and distributing clothing and related products to

other companies.

Zhang decided to shut down the operations of Shenyang Joway in order to focus his attention on the

Joway Shengshi’s business.

Shenyang Joway has ceased operations, although it still exists as a legal entity, and the Joway

Shengshi was able to find new suppliers with no material adverse impact to the Company.

May 7, 2007, one of our operating subsidiaries, Joway Shengshi entered into an agreement with Shenyang Joway pursuant to which

Joway Shengshi and Shenyang Joway agreed to provide each other with interest-free, unsecured advances for working capital.

May 10, 2007, one of our subsidiaries, Joway Technology and Shenyang Joway entered into an agreement pursuant to which Joway

Technology and Shenyang Joway agreed to provide each other with interest-free, unsecured advances for working capital.

to these agreements, Shenyang Joway advanced an aggregate of $912,645 to Joway Shengshi and Joway Technology through December

During the years of 2019 and 2018, we repaid $118,458 and received $116,219 of these advances, respectively.

of December 31, 2019, the total unpaid principal balance due to Shenyang Joway for advances was $0.

Shenyang Joway was cancelled

with Jinghe Zhang

May 10, 2007, one of our operating subsidiaries, Joway Shengshi entered into a cash advance agreement with Mr.

Jinghe Zhang,

our President, Chief Executive Officer and director.

immediate family member of a director or executive officer, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law,

father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law of such director, executive officer and any person (other

than a tenant or employee) sharing the household of such director or executive officer;

person who was in any of the following categories when a transaction in which such person had a direct or indirect material interest

occurred or existed:

person who is known to the registrant to be the beneficial owner of more than five percent of any class of the registrant’s voting

immediate family member of any such security holder, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law,

father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law of such security holder, and any person (other than a tenant

or employee) sharing the household of such security holder.

Transactions with Jinghe Zhang

On May 10, 2007, one of our operating subsidiaries, Joway Shengshi entered into a cash advance agreement with Mr.

Jinghe Zhang, our President, Chief Executive Officer and director.

Pursuant to the agreement, Mr.

Jinghe Zhang agreed to advance operating

capital to Joway Shengshi.

Jinghe Zhang agreed to advance operating capital to Joway Shengshi.

These advances are interest free, unsecured and are repayable upon demand.

During the period beginning

May 17, 2007 (inception of Joway Shengshi) through December 31, 2019, Joway Shengshi received cash advances in the aggregate

principal amount of $6,113,326 from Jinghe Zhang of which $4,632,811has been repaid.

During the years of 2019 and 2018, we

received $954,987 and $398,729 of these advances, respectively.

As of December 31, 2019, the total unpaid principal balance

During the years of 2020 and 2019, we received $158,930 and $55,625 of these advances, respectively.

As of December 31, 2020, the total unpaid principal balance due to Mr.

Jinghe Zhang for advances was $233,693.

Related Party Transactions

as disclosed above, no executive officer, director or any member of these individuals’

immediate families, any corporation

or organization with whom any of these individuals is an affiliate or any trust or estate in which any of these individuals serve

as a trustee or in a similar capacity or has a substantial beneficial interest in is or has been indebted to us at any time since

the beginning of our last fiscal year.

for Approval of Related Party Transactions

Director Board is charged with reviewing and approving all potential related party transactions.

All such related party transactions

must then be reported under applicable SEC rules.

We have not adopted other procedures for review, or standards for approval,

of such transactions, but instead review them on a case-by-case basis.

The patents that we used during the year ended December 31, 2020 are owned by our Chief Executive Officer, Mr.

Jinghe Zhang.

Pursuant to a license agreement with our President, Chief Executive Officer and director, Mr.

Jinghe Zhang, we are permitted to use two patents for free from the effective date to the expiration date of each patent.

As of April 28, 2021, Jinghe

Zhang released the Company from $295,928.47 of indebtedness owed to him from the Company.

There is no further indebtedness owed from or

to Jinghe Zhang by the Company.

Transactions with Joway Shengshi

Joway Shengshi is a company

of the discontinued operations.

Jinghe Zhang owns 99% of the equity interest in Joway Shengshi.

During the years of 2020 and 2019,

we received $23,585 and $51,958 of advances from Joway Shengshi, respectively.

As of December 31, 2020, the total unpaid principal balance

due to Joway Shengshi for advances was $459,853.

As of April 28, 2021, Joway

Shengshi released the Company from $463,697.67 of indebtedness owed to it from the Company.

There is no further indebtedness owed from

or to Joway Shengshi by the Company.

Other Related Party Transactions

Except as disclosed in this

Annual Report, no executive officer, director or any member of these individuals’

immediate families, any corporation or organization

with whom any of these individuals is an affiliate or any trust or estate in which any of these individuals serve as a trustee or in a

similar capacity or has a substantial beneficial interest in is or has been indebted to us at any time since the beginning of our last

(See Item I Business - Recent Developments - Entry into a Material Definitive Agreement & Completion of Acquisition or

Disposition of Assets)

Procedures for Approval of Related Party Transactions

Our Director Board is charged

with reviewing and approving all potential related party transactions.

All such related party transactions must then be reported

under applicable SEC rules.

We have not adopted other procedures for review, or standards for approval, of such transactions, but instead

review them on a case-by-case basis.

PRINCIPAL ACCOUNTING FEES AND SERVICES.

For each fiscal year

of 2019 and 2018, we incurred aggregate fees and expenses of $79,000 and $84,000 from HHC for works completed for our annual audits

For each fiscal year of 2020

and 2019, we incurred aggregate fees and expenses of $55,000 and $79,000, respectively, from HHC for works completed for our annual audits

and quarterly reviews.

Audit-Related

Audit-related

expenses for 2019 and 2018 were $1,007 and $753, respectively.

incurred aggregate fees and expenses of $5,000 for each fiscal year of 2019 and 2018.

incurred other fees of $0 for each fiscal year of 2019 and 2018.

on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors

we did not have a formal audit committee, our board of directors served as our audit committee.

We have not adopted pre-approval

policies and procedures with respect to our accountants in 2019.

All of the services provided and fees charged by our independent

registered accounting firms in 2019 were approved by the board of directors.

Board of Directors has reviewed and discussed with HHC, our audited financial statements contained in this Annual Report on Form

10-K for the 2019 and 2018 fiscal years.

The Board of Directors also has discussed with HHC, the matters required to be discussed

pursuant to SAS No.

61 (Codification of Statements on Auditing Standards, AU Section 380), which includes, among other items,

matters related to the conduct of the audit of our financial statements.

Board of Directors has received and reviewed the written disclosures and the letter from HHC required by Independence Standards

Board Standard No.1 (Independence Discussions with Audit Committees), and has discussed with HHC its independence from our company.

Board of Directors has considered whether the provision of services other than audit services is compatible with maintaining auditor

independence.

Based on the review and discussions referred to above, the Board of Directors determined that the audited financial

statements be included in our Annual Report on Form 10-K for our 2019 and 2018 fiscal years for filing with the SEC.

Audit-Related Expenses

Audit-related expenses for

2020 and 2019 were $0 and $1,007, respectively.

We incurred aggregate fees

and expenses of $0 for each fiscal year of 2020 and 2019, respectively.

All Other Fees

We incurred other fees of

$0 for each fiscal year of 2020 and 2019.

Policy on Audit Committee Pre-Approval of Audit and Permissible

Non-Audit Services of Independent Auditors

Since we did not have a formal

audit committee, our board of directors served as our audit committee.

We have not adopted pre-approval policies and procedures with respect

to our accountants in 2019.

All of the services provided and fees charged by our independent registered accounting firms in 2020 were

approved by the board of directors.

Our Board of Directors has

reviewed and discussed with HHC, our audited financial statements contained in this Annual Report on Form 10-K for the 2020 and 2019 fiscal

The Board of Directors also has discussed with HHC, the matters required to be discussed pursuant to SAS No.

61 (Codification of

Statements on Auditing Standards, AU Section 380), which includes, among other items, matters related to the conduct of the audit of our

financial statements.

Our Board of Directors has

received and reviewed the written disclosures and the letter from HHC required by Independence Standards Board Standard No.1 (Independence

Discussions with Audit Committees), and has discussed with HHC its independence from our company.

Our Board of Directors has

considered whether the provision of services other than audit services is compatible with maintaining auditor independence.

review and discussions referred to above, the Board of Directors determined that the audited financial statements be included in our Annual

Report on Form 10-K for our 2020 and 2019 fiscal years for filing with the SEC.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES.

agreements with suppliers that accounted for more than 10% of our revenues are filed as exhibits in the following.

All agreements with suppliers

that accounted for more than 10% of our revenues are filed as exhibits in the following.

Articles of Incorporation (1)

Specimen of Common Stock Certificate (1)

Description of Capital Stock*

Share Exchange Agreement, dated October 1, 2010, by and among G2 Ventures, Crystal Globe and Dynamic Elite (3)

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Cooperative Contract between Joway Shengshi and Tianjin Hezhi Pharmaceutical Co.

Agreement, dated as of November 20, 2020, by and among Crystal Globe Limited, Joway Health Industries Group Inc., Dynamic Elite International

Limited and Joway Merger Subsidiary Limited (9)

Code of Ethics (2)

List of Subsidiaries*

Rule 13a-14a/15d-14(a) Certification by the Chief Executive Officer*

Rule 13a-14a/15d-14(a) Certification by the Chief Financial Officer*

Certification by the Chief Executive Officer pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

Certification by the Chief Financial Officer pursuant to 18 U.S.C.

Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

of Subsidiaries (10)

Certification of the Principal Executive Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

Certification of the Principal Financial Officer of Registrant pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

Certification of the Principal Executive Officer of Registrant pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 *

Certification of the Principal Financial Officer of Registrant pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 *

XBRL Instance Document

4 unchanged sentences

XBRL Taxonomy Extension Presentation Linkbase Document

(1) Incorporated

by reference to the exhibits to our registration statement on Form SB-2 filed with the SEC on September 11, 2003.

(2) Incorporated

by reference to the exhibits to our Annual Report on Form 10-K filed with the SEC on March 1, 2010.

(3) Incorporated

by reference to the exhibits to our current Report on Form 8-K filed with the SEC on October 7, 2010.

(4) Incorporated

by reference to the exhibits to our Annual Report on Form 10-K filed with the SEC on April 14, 2011.

(5) Incorporated

by reference to the exhibits to our Annual Report on Form 10-K Amendment No.

1 filed with the SEC on November 15, 2011.

(6) Incorporated

by reference to the exhibits to our current Report on Form 8-K Amendment No.

1 filed with the SEC on June 13, 2011.

(7) Incorporated

by reference to the exhibits to our current Report on Form 8-K Amendment No.

2 unchanged sentences

by reference to the exhibits to our Annual Report on Form 10-K filed with the SEC on March 30, 2012.

to the requirements of Section 13 or 15(d) of the Exchange Act of 1934, the registrant has duly caused this report to be

signed on its behalf by the undersigned, thereunto duly authorized.

March 30, 2020

(9) Incorporated by reference to the exhibits to our Current

Report on Form 8-K filed with the SEC on November 25, 2020.

(10) Incorporated by reference to the exhibits to our Annual Report

on Form 10-K filed with the SEC on March 30, 2021.

FORM 10–K SUMMARY

Pursuant to the requirements of Section 13

or 15(d) of the Exchange Act of 1934, the registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto

duly authorized.

August 16, 2021

HEALTH INDUSTRIES GROUP, INC.

3 unchanged sentences

Financial and Accounting Officer)

to the requirements of Section 13 or 15(d) of the Exchange Act of 1934, the registrant has duly caused this report to be

signed on its behalf of the registrant and in the capacities and on the dates indicated.

Pursuant to the requirements of Section 13 or 15(d) of the Exchange

Act of 1934, the registrant has duly caused this Report to be signed on its behalf of the registrant and in the capacities and on the

dates indicated.

/s/ JINGHE ZHANG

March 30, 2020

Chief Executive Officer

Chairman\(Principal Executive

August 16, 2021

Chief Executive Officer and

Chairman\(Principal Executive Officer)

/s/ YUAN HUANG

Chief Financial Officer

March 30, 2020

Financial and Accounting Officer)

August 16, 2021

(Principal Financial and Accounting Officer)

JOWAY HEALTH INDUSTRIES GROUP INC.

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Notes to Consolidated Financial Statements

of Independent Registered Public Accounting Firm

To the Board of Directors and

Shareholders of Joway Health Industries Group

and Subsidiaries

Report of Independent Registered Public Accounting

To the shareholders and the Board of Directors of

Joway Health Industries Group Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated

balance sheets of Joway Health Industries Group Inc.

and Subsidiaries (the Company) as of December 31, 2019 and 2018,

and the related consolidated statements of operations, comprehensive income, stockholders’

equity and cash flows for each

of the two years in the period ended December 31, 2019.

In our opinion, the financial statements present fairly, in all

material respects, the consolidated financial position of the Company at December 31, 2019 and 2018, and the consolidated

We have audited the accompanying balance sheets

of Joway Health Industries Group Inc.

(the Company) as of December 31, 2020 and 2019, and the related consolidated statements

of operations, comprehensive loss, stockholders’

equity, and cash flows for each of the two years in the period ended December 31,

2020, and related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements

present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the consolidated

results of its operations and its cash flows for each of the two years in the period ended December 31, 2020, in conformity

generally accepted accounting principles.

with accounting principles generally accepted in the United States of America.

Substantial doubt about the Company’s

ability to continue as a going concern

The accompanying financial statements have been

prepared assuming that the Company will continue as a going concern.

As discussed in Note 2 to the financial statements, the Company has

suffered recurring significant losses and has accumulated deficiency in stockholders’

These factors raise substantial doubt

about the Company’s ability to continue as a going concern.

Management’s plans in regard to this matter are also discussed

The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Basis for Opinion

1 unchanged sentence

of the Company’s management.

Our responsibility is to express an opinion on these financial statements based on our audits.

We are a public accounting firm registered with the 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

We conducted our audits in accordance with

the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether

the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures

to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures

that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures

in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made

by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a

reasonable basis for our opinion.

The accompanying consolidated financial

statements have been prepared assuming that the Company will continue as a going concern.

As discussed in Note 2 to the consolidated

financial statements, the Company has incurred significant losses and has deficiencies in both stockholders’

equity and working

These factors raise substantial doubt about the Company’s ability to continue as a going concern.

Management’s

plans in regard to this matter are also discussed in Note 2.

The financial statements do not include any adjustments that might

result from the outcome of this uncertainty.

We have served as the Company's auditor

Our responsibility is to express an opinion on the Company’s financial statements based on our

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are

required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and

regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the

standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial

statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged

to perform, an audit of its internal control over financial reporting.

As part of our audits, we are required to obtain an understanding

of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s

internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess

the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond

to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating

the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is

a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the

audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially

challenging, subjective, or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on

the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion

on the critical audit matter or on the accounts or disclosures to which it relates.

Disposal of Dynamic Elite

Critical Audit Matter Description

As described the Note 3 to the financial statements,

on November 20, 2020, the Company entered into a Merger Agreement (the “Merger Agreement”) with Dynamic Elite International

Limited, a British Virgin Islands company and a wholly-owned subsidiary of the Company (“Dynamic Elite”), Crystal Globe Limited,

a British Virgin Islands company (“Crystal Globe”) and Joway Merger Subsidiary Limited, a British Virgin Islands company and

a wholly-owned subsidiary of Crystal Globe (“Merger Sub”).

Pursuant to the terms of the Merger Agreement, at the effective

time of the Merger (the “Effective Time”) and as a result of the Merger, the ordinary shares of common stock of Dynamic Elite

issued and outstanding immediately prior to the Effective Time, all of which are held by the Company, were cancelled and extinguished.

In accordance with the Merger Agreement, Crystal Globe has offered to pay cash consideration to the Company of $0.045 per share for the

outstanding shares of the common stock of the Company (the “Merger Consideration”).

The transaction relates to accounts and disclosures

that are material to the financial statements because the Transaction involved a significant unusual transaction with related parties,

resulted a loss of $1,340,795 and a strategic operation shift of the Company.

During the audit of the financial statement we were required

to communicate with the audit committee about the challenging, subjective and complex judgement required when auditing the Transaction

and the significant unusual measurement and disclosure requirements required with completing the transaction.

The transaction was identified

as a critical audit matter for the audit of the financial statements.

How the Critical Audit Matter Was Addressed

Our key strategic audit

procedure related to the Transaction included:

1) assignment of the most experienced staff to perform extended audit procedure on the

Transaction, 2) enhanced audit procedures on all the transferred entities.

3) obtained evidence from external service agents involved

in the Transaction, related to legality and consideration of the Transaction;

4) testing management’s process for approving the

disposal price of Dynamic Elite;

evaluating the appropriateness of the valuation of Dynamic Elite’s net assets used by management;

and testing the completeness and accuracy of underlying data used by management.

We have served as the Company’s auditor since

Forest Hills, New York

March 30, 2020

August 16, 2021

Consolidated Financial Statements

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

of December 31,

As of December 31,

CURRENT ASSETS:

Other receivables

Advances to suppliers

Prepaid taxes

Receivable from related party

Prepaid expense

Assets from discontinued component

Total current assets

PROPERTY, PLANT AND EQUIPMENT, net

OTHER ASSETS:

Intangible assets, net

Total other assets

L I A B I L I T I E S A N D S T O C K H O L D E R S’

LIABILITIES AND STOCKHOLDERS’

CURRENT LIABILITIES:

Accounts payable

Contract liabilities

Special dividend payable

Other payables

Due to related parties

Liabilities from discontinued component

Total current liabilities

12 unchanged sentences

Total liabilities and stockholders’

The accompanying notes are an integral part

of these financial statements

JOWA Y HEALTH INDUSTRIES GROUP INC.

The accompanying notes are an integral part of these financial statements

JOWAY HEALTH INDUSTRIES GROUP INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE LOSS

the year ended

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For the year ended

COST OF REVENUES

Selling expenses

General and administrative expenses

Impairment loss from inventory

OPERATING EXPENSES

LOSS FROM OPERATIONS

Interest income

Other expenses

1 unchanged sentence

LOSS BEFORE INCOME TAXES

NET LOSS FROM CONTINUING OPERATIONS

Discontinued operations:

Loss from operations of discontinued component, net of taxes

Loss from disposal of discontinued component, net of taxes

OTHER COMPREHENSIVE LOSS:

3 unchanged sentences

$ (1,286,985 )

NET LOSS PER COMMON SHARE, BASIC AND DILUTED

LOSS PER COMMON SHARE, BASIC AND DILUTED:

Continuing operations - Basic & diluted

Discontinued operations - Basic & diluted

WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING, BASIC AND DILUTED

The accompanying notes are an integral part

of these financial statements

The accompanying notes are an integral part of these financial statements

JOWAY HEALTH INDUSTRIES GROUP INC.

5 unchanged sentences

$ (4,026,099 )

Foreign currency translation loss

currency translation loss

BALANCE, December 31, 2019

$ (5,264,040 )

Foreign currency translation loss

Disposal of subsidiary

currency translation gain

BALANCE, December 31,

$ (7,234,180 )

The accompanying notes are an integral part

of these financial statements

J OWAY HEALTH INDUSTRIES GROUP INC.

JOWAY HEALTH INDUSTRIES GROUP INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

the year ended

For the year ended

CASH FLOWS FROM OPERATING ACTIVITIES:

$ (1,237,941 )

$ (1,522,147 )

Adjustments to reconcile net loss to net cash used in operating activities

Allowance for doubtful accounts

Impairment loss from inventory

Loss on sale of assets

Net loss from continuing operations

Adjustments to reconcile net loss to net cash provided by operating activities

Changes in operating assets and liabilities:

Accounts receivable, trade

Other receivables

Advances to suppliers

Prepaid expenses

Accounts payable

Contract liabilities

Other payable

Salary and welfare payables

Taxes payable

Prepaid Expense

Other payables

Net cash used in operating activities from continuing component

Net cash used in operating activities from discontinued component

Net cash used in operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchase of property plant and equipment

Proceeds from sale of equipment

Net cash provided by (used in) investing activities from continuing component

Net cash used in investing activities from discontinued component

Net cash used in investing activities

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds of due to related parties

Due to related parties

Net cash provided by financing activities from continuing component

Net cash provided by financing activities from discontinued component

Net cash provided by financing activities

EFFECT OF EXCHANGE RATE CHANGES ON CASH

NET DECREASE IN CASH

NET INCREASE IN CASH

CASH, beginning of year

3 unchanged sentences

Interest paid

The accompanying notes are an integral part

of these financial statements

HEALTH INDUSTRIES GROUP INC.

NON-CASH TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES

Receivable used to offset the selling price of disposal of Dynamic Elite and Subsidiaries

Uncollected consideration from Disposal of Dynamic Elite and Subsidiaries

Undistributed consideration to the minority shareholders

The accompanying notes are an integral part of these financial statements

JOWAY HEALTH INDUSTRIES GROUP INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

consolidated financial statements include the financial statements of Joway Health Industries Group Inc.

(referred to herein as

“Joway Health”), its subsidiaries, and variable interest entities (“VIEs”) where Joway Health is deemed

the primary beneficiary.

Joway Health, its subsidiaries and VIEs are collectively referred to herein as the “Company,”

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 –

The consolidated financial statements

include the financial statements of Joway Health Industries Group Inc.

(referred to herein as “Joway Health”), its subsidiaries,

and variable interest entities (“VIEs”) where Joway Health is deemed the primary beneficiary.

Joway Health, its subsidiaries

and VIEs are collectively referred to herein as the “Company,”

“we”

and “us”.

Health (formerly G2 Ventures, Inc.) was originally incorporated under the laws of the State of Texas on March 21, 2003.

21, 2010, Joway Health entered into a Share Exchange Agreement (the “Share Exchange”) with the sole stockholder of

Dynamic Elite International Limited.

As a result of the Share Exchange, Dynamic Elite became a wholly-owned subsidiary of Joway

Health and the stockholders of Dynamic Elite acquired approximately 76.08% of the issued and outstanding stock of Joway Health.

The share exchange transaction resulted in the shareholders of Dynamic Elite acquiring a majority voting interest in Joway Health.

Generally accepted accounting principles in the United States of America require that the company whose shareholders retain the

majority interest in the combined business be treated as the acquirer for accounting purposes.

The reverse acquisition process

utilizes the capital structure of Joway Health and the assets and liabilities of Dynamic Elite recorded at historical cost.

December 22, 2010, Joway Health changed its jurisdiction of incorporation from the State of Texas to the State of Nevada.

Elite International Limited (referred to herein as “Dynamic Elite”) was incorporated under the laws of the British

Virgin Islands on June 2, 2010 as a limited liability company (a BVI company).

Dynamic Elite engages in manufacturing and distributing

tourmaline products in China.

Its wholly owned subsidiary, Tianjin Junhe Management Consulting Co., Ltd.

was incorporated on September

15, 2010 in Tianjin, People’s Republic of China (“PRC”).

Other than the equity interest in Junhe Consulting,

Dynamic Elite does not own any assets or conduct any operations.

Junhe Management Consulting Co., Ltd.

(referred to herein as “Junhe Consulting”) conducts its business through Tianjin

Joway Shengshi Group Co., Ltd.

that is consolidated as a variable interest entity.

Joway Shengshi Group Co., Ltd.

(referred to herein as “Joway Shengshi”) was incorporated in PRC on May 17, 2007.

Shengshi is currently owned 99% by Jinghe Zhang, the Company’s current CEO and President and 1% by Song Baogang.

Joway Shengshi

engages in manufacturing and distributing tourmaline products in China.

Shenyang Joway Electronic Technology Co., Ltd., Tianjin

Joway Decoration Engineering Co., Ltd.

and Tianjin Oriental Shengtang Trading Import & Export Trading Co., Ltd.

are subsidiaries

of Joway Shengshi.

Joway Electronic Technology Co., Ltd.

(referred to herein as “Joway Technology”) was originally named Liaoning Joway

Technology Engineering Co., Ltd.

which was incorporated on March 28, 2007 in PRC.

Joway Health (formerly G2 Ventures, Inc.) was

originally incorporated under the laws of the State of Texas on March 21, 2003.

On September 21, 2010, Joway Health entered into a Share

Exchange Agreement (the “Share Exchange”) with the sole stockholder of Dynamic Elite International Limited.

As a result of

the Share Exchange, Dynamic Elite became a wholly-owned subsidiary of Joway Health and the stockholders of Dynamic Elite acquired approximately

76.08% of the issued and outstanding stock of Joway Health.

The share exchange transaction resulted in the shareholders of Dynamic Elite

acquiring a majority voting interest in Joway Health.

Generally accepted accounting principles in the United States of America require

that the company whose shareholders retain the majority interest in the combined business be treated as the acquirer for accounting purposes.

The reverse acquisition process utilizes the capital structure of Joway Health and the assets and liabilities of Dynamic Elite recorded

at historical cost.

On December 22, 2010, Joway Health changed its jurisdiction of incorporation from the State of Texas to the State

Dynamic Elite International Limited (referred

to herein as “Dynamic Elite”) was incorporated under the laws of the British Virgin Islands on June 2, 2010 as a limited liability

company (a BVI company).

Dynamic Elite engages in manufacturing and distributing tourmaline products in China.

Its wholly owned subsidiary,

Tianjin Junhe Management Consulting Co., Ltd.

was incorporated on September 15, 2010 in Tianjin, People’s Republic of China (“PRC”).

Other than the equity interest in Junhe Consulting, Dynamic Elite does not own any assets or conduct any operations.

Tianjin Junhe Management Consulting Co., Ltd.

(referred to herein as “Junhe Consulting”) conducts its business through Tianjin Joway Shengshi Group Co., Ltd.

that is consolidated

as a variable interest entity.

Tianjin Joway Shengshi Group Co., Ltd.

to herein as “Joway Shengshi”) was incorporated in PRC on May 17, 2007.

Joway Shengshi is currently owned 99% by Jinghe Zhang,

the Company’s current CEO and President and 1% by Song Baogang.

Joway Shengshi engages in manufacturing and distributing tourmaline

products in China.

Shenyang Joway Electronic Technology Co., Ltd., Tianjin Joway Decoration Engineering Co., Ltd.

and Tianjin Oriental

Shengtang Trading Import & Export Trading Co., Ltd.

are subsidiaries of Joway Shengshi.

Shenyang Joway Electronic Technology Co., Ltd.

(referred to herein as “Joway Technology”) was originally named Liaoning Joway Technology Engineering Co., Ltd.

incorporated on March 28, 2007 in PRC.

The name was changed on June 22, 2011.

in the distribution of Tourmaline Activated Water Machines and the construction of Tourmaline Wellness Houses.

Prior to July 25,

2010, Joway Shengshi owned 90.91% of Joway Technology.

Joway Shengshi entered into a share acquisition agreement with Jingyun

Chen, another stockholder of Joway Technology on July 25, 2010 to acquire the remaining 9.09% of the share of Joway Technology.

As a result of the share acquisition, Joway Technology became a wholly-owned subsidiary of Joway Shengshi.

Joway Decoration Engineering Co., Ltd.

(referred to herein as “Joway Decoration”) was incorporated on April 22, 2009

It engages in the distribution of Tourmaline Activated Water Machines, Tourmaline Wellness Room for family use and Tourmaline

Wellness House materials.

Prior to July 9, 2010, Joway Shengshi owned 90% of Joway Decoration.

Joway Shengshi entered into a share

acquisition agreement with Jingyun Chen, another stockholder of Joway Decoration on July 9, 2010 to acquire the remaining 10%

of the shares of Joway Decoration.

As a result of the share acquisition, Joway Decoration became a wholly-owned subsidiary of

Joway Shengshi.

It engages in the distribution of Tourmaline Activated Water

Machines and the construction of Tourmaline Wellness Houses.

Prior to July 25, 2010, Joway Shengshi owned 90.91% of Joway Technology.

Joway Shengshi entered into a share acquisition agreement with Jingyun Chen, another stockholder of Joway Technology on July 25, 2010

to acquire the remaining 9.09% of the share of Joway Technology.

As a result of the share acquisition, Joway Technology became a wholly-owned

subsidiary of Joway Shengshi.

Tianjin Joway Decoration Engineering Co., Ltd.

(referred to herein as “Joway Decoration”) was incorporated on April 22, 2009 in PRC.

It engages in the distribution of Tourmaline

Activated Water Machines, Tourmaline Wellness Room for family use and Tourmaline Wellness House materials.

Prior to July 9, 2010, Joway

Shengshi owned 90% of Joway Decoration.

Joway Shengshi entered into a share acquisition agreement with Jingyun Chen, another stockholder

of Joway Decoration on July 9, 2010 to acquire the remaining 10% of the shares of Joway Decoration.

As a result of the share acquisition,

Joway Decoration became a wholly-owned subsidiary of Joway Shengshi.

Jingyun Chen is currently the General Manager of Joway Decoration.

Oriental Shengtang Import & Export Trading Co., Ltd (referred to herein as “Shengtang Trading”) was incorporated

on September 18, 2009 in the PRC.

It engages in purchasing raw materials which it sells to other companies of the group.

to July 28, 2010, Joway Shengshi owned 95% of Shengtang Trading.

Joway Shengshi entered into a share acquisition agreement with

Wang Aiying, another stockholder of Shengtang Trading on July 28, 2010 to acquire the remaining 5% of the shares of Shengtang

As a result of the share acquisition, Shengtang Trading became a wholly-owned subsidiary of Joway Shengshi.

following table lists the Company and its subsidiaries:

Tianjin Oriental Shengtang Import & Export

Trading Co., Ltd.

(referred to herein as “Shengtang Trading”) was incorporated on September 18, 2009 in the PRC.

in purchasing raw materials which it sells to other companies of the group.

Prior to July 28, 2010, Joway Shengshi owned 95% of Shengtang

Joway Shengshi entered into a share acquisition agreement with Wang Aiying, another stockholder of Shengtang Trading on July

28, 2010 to acquire the remaining 5% of the shares of Shengtang Trading.

As a result of the share acquisition, Shengtang Trading became

a wholly-owned subsidiary of Joway Shengshi.

On November 20, 2020, Joway Health entered into

a Merger Agreement (the “Merger Agreement”) with one of its related parties, Crystal Globe Limited, a British Virgin Islands

company (“Crystal Globe”), for the sale of Joway Health’s 100% equity interest in Dynamic Elite, Dynamic Elite’s

subsidiaries, and Dynamic Elite’s VIEs for a purchase price of $0.045 per share for the Company’s outstanding common stock.

As of November 20, 2020, the Company reported 20,054,000 shares of common stock outstanding.

Crystal Globe is the major shareholder of

Joway Health and holding 86.8% of Joway Health’s outstanding common stock.

The Merger Agreement provides that, upon the terms and

subject to the satisfaction or waiver of the conditions set forth therein, all of Joway Health’s subsidiaries and VIEs, including

Dynamic Elite, will be transferred to Crystal Globe and its subsidiaries.

The special committee of the Board of Directors of the Company

unanimously approved the Merger Agreement and the transaction was completed on December 31, 2020.

Jinghe Zhang, as the President,

Chief Executive Officer, Chairman and Director, and the majority beneficial owner of Joway Health, also serves as sole shareholder and

executive director of Crystal Globe.

As a result, Joway Health and Dynamic Elite are under common control of Crystal Globe and Mr.

In January 2021, the Company had received $119,070

from Crystal Globe and distributed proportionately to the Company’s minority shareholders, other than Crystal Globe, which represents

2,646,000 shares of the Company’s common stock.

Since the remaining 17,408,000 shares of our common stock is owned by Crystal Globe,

the $0.045 per share payment for the 17,408,000 shares is offset.

The following table lists the Company and its

subsidiaries prior to the Merger Agreement:

Domicile and Date of Incorporation

35 unchanged sentences

Distribution of tourmaline products

September 16, 2010, prior to the share exchange, Junhe Consulting entered into a series of contractual agreements (the “Contractual

Agreements”) with Joway Shengshi and Joway Shengshi’s owners.

The following is a brief description of the Contractual

Agreements entered between Junhe Consulting and Joway Shengshi or Joway Shengshi’s owners:

On September 16, 2010, prior to the Merger Agreement,

Junhe Consulting entered into a series of contractual agreements (the “Contractual Agreements”) with Joway Shengshi and Joway

Shengshi’s owners.

The following is a brief description of the Contractual Agreements entered between Junhe Consulting and Joway

Shengshi or Joway Shengshi’s owners:

Consulting Services Agreement.

Pursuant to the consulting services agreement between Junhe Consulting and Joway Shengshi,

Junhe Consulting has the right to advise, consult, manage, and operate Joway Shengshi, and collect and own all of the net profits

of the Operating Entities.

to the consulting services agreement between Junhe Consulting and Joway Shengshi, Junhe Consulting has the right to advise, consult, manage,

and operate Joway Shengshi, and collect and own all of the net profits of the Operating Entities.

Operating Agreement.

Under the operating agreement between Junhe Consulting and Joway Shengshi, Junhe Consulting has the

right to recommend director candidates, appoint the senior executives of Joway Shengshi, approve any transactions that may materially

affect the assets, liabilities, rights or operations of Joway Shengshi, and guarantee the contractual performance by Joway Shengshi

of any agreements with third parties, in exchange for a pledge by Joway Shengshi of its accounts receivable and assets.

Under the operating

agreement between Junhe Consulting and Joway Shengshi, Junhe Consulting has the right to recommend director candidates, appoint the senior

executives of Joway Shengshi, approve any transactions that may materially affect the assets, liabilities, rights or operations of Joway

Shengshi, and guarantee the contractual performance by Joway Shengshi of any agreements with third parties, in exchange for a pledge by

Joway Shengshi of its accounts receivable and assets.

Voting Rights Proxy Agreement.

Under the voting rights proxy agreement between Joway Shengshi’s owners and Junhe

Consulting, the owners of Joway Shengshi have vested their collective voting control over Joway Shengshi to Junhe Consulting and

will only transfer their respective equity interests in Joway Shengshi to Junhe Consulting or its designee.

the voting rights proxy agreement between Joway Shengshi’s owners and Junhe Consulting, the owners of Joway Shengshi have vested

their collective voting control over Joway Shengshi to Junhe Consulting and will only transfer their respective equity interests in Joway

Shengshi to Junhe Consulting or its designee.

Option Agreement.

Under the option agreement between Joway Shengshi’s owners and Junhe Consulting, the owners of

Joway Shengshi have granted Junhe Consulting the irrevocable right and option to acquire all of their equity interests in Joway

Under the option agreement

between Joway Shengshi’s owners and Junhe Consulting, the owners of Joway Shengshi have granted Junhe Consulting the irrevocable

right and option to acquire all of their equity interests in Joway Shengshi.

Equity Pledge Agreement.

Under the equity pledge agreement between Joway Shengshi’s owners and Junhe Consulting,

the owners of Joway Shengshi have pledged all of their rights, titles and interests in Joway Shengshi to Junhe Consulting to guarantee

Joway Shengshi’s performance of its obligations under the Consulting Services Agreement.

a result of the Contractual Agreements, Joway Shengshi is effectively a variable interest entity of Junhe Consulting.

the Company through its wholly-owned subsidiary Junhe Consulting, consolidates Joway Shengshi’s results of operation, assets

and liabilities in its financial statements.

connection with the Share Exchange and as consideration for entering into the VIE Agreements, Jinghe Zhang and

Baogang Song, the shareholders of Joway Shengshi (the “Grantees”), entered into a Call Option Agreement, dated

July 20,2010 with Lionel Evan Liu (the “Grantor”), the sole shareholder of Crystal Globe (the controlling

shareholder of Dynamic Elite), a British Virgin Islands company (the “Call Option Agreement”), pursuant to which

the Grantees had the right to purchase up to 100% of the shares of Crystal Globe (the “Call Option”)at an

exercise price of $2.00 per share (the “Exercise Price”) for a period of five years.

The Call Option vested as to

34% of the shares of Crystal Globe on April 2, 2011 and as to 33% on each of April 2, 2012 and 2013(the respective

“Call Option Effective Date”).

On March 28, 2015, the Grantor and Grantees amended the Call Option Agreement, to

(i) reduce the Exercise Price to $0.00 per share and (ii) extend the Grantees’

rights to exercise their call option

within ten years from the respective Option Effective Date.

November 13, 2016, Jinghe Zhang exercised the Call Option as to 99% of the shares of Crystal Globe and Baogang Song exercised

his Call Option as to 1% of the shares of Crystal Globe.

As a result of exercising the Call Option, Jinghe Zhang became the controlling

shareholder of Crystal Globe and in turn, the controlling shareholder of the Company.

On November 20, 2016, Baogang Song transferred

1% of the shares of Crystal Globe to Jinghe Zhang.

Consequently, Jinghe Zhang controls 17,408,000 shares, or 86.8%, of the issued

and outstanding shares of the Company’s common stock.

Under the equity

pledge agreement between Joway Shengshi’s owners and Junhe Consulting, the owners of Joway Shengshi have pledged all of their rights,

titles and interests in Joway Shengshi to Junhe Consulting to guarantee Joway Shengshi’s performance of its obligations under the

Consulting Services Agreement.

As a result of the Contractual Agreements, Joway

Shengshi is effectively a variable interest entity of Junhe Consulting.

Accordingly, the Company through its wholly-owned subsidiary Junhe

Consulting, consolidates Joway Shengshi’s results of operation, assets and liabilities in its financial statements.

However, upon

the Merger Agreement was completed on December 31, 2020, Joway Health does not have any subsidiary or VIEs.

Joway Health consolidated

Joway Shengshi’s results of operations as discontinued operations in its financial statements for the period prior to the Merger

In connection with the Share Exchange and as consideration

for entering into the VIE Agreements, Jinghe Zhang and Baogang Song, the shareholders of Joway Shengshi (the “Grantees”),

entered into a Call Option Agreement, dated July 20,2010 with Lionel Evan Liu (the “Grantor”), the sole shareholder of Crystal

Globe (the controlling shareholder of Dynamic Elite), a British Virgin Islands company (the “Call Option Agreement”), pursuant

to which the Grantees had the right to purchase up to 100% of the shares of Crystal Globe (the “Call Option”)at an exercise

price of $2.00 per share (the “Exercise Price”) for a period of five years.

The Call Option vested as to 34% of the shares

of Crystal Globe on April 2, 2011 and as to 33% on each of April 2, 2012 and 2013 (the respective “Call Option Effective Date”).

On March 28, 2015, the Grantor and Grantees amended the Call Option Agreement, to (i) reduce the Exercise Price to $0.00 per share and

(ii) extend the Grantees’

rights to exercise their call option within ten years from the respective Option Effective Date.

On November 13, 2016, Jinghe Zhang exercised the

Call Option as to 99% of the shares of Crystal Globe and Baogang Song exercised his Call Option as to 1% of the shares of Crystal Globe.

As a result of exercising the Call Option, Jinghe Zhang became the controlling shareholder of Crystal Globe and in turn, the controlling

shareholder of the Company.

On November 20, 2016, Baogang Song transferred 1% of the shares of Crystal Globe to Jinghe Zhang.

Consequently,

Jinghe Zhang controls 17,408,000 shares, or 86.8%, of the issued and outstanding shares of the Company’s common stock.

On December 31, 2020, upon the Company completed

the Merger Agreement with Crystal Globe, Joway Health becomes a “shell company”

(as such term is defined in Rule 12b-2 under

the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

Going forward, the Company intends to seek, investigate

and, if such investigation warrants, engage in a business combination with a private entity whose business presents an opportunity for

the Company’s stockholders.

Note 2 –

GOING CONCERN

The accompanying consolidated financial statements

have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and

the discharge of liabilities in the normal course of business for the foreseeable future.

As reflected in the accompanying

consolidated financial statements, the Company incurred a significant net loss of $1.2 million for the year ended December

31, 2019, an accumulated deficit of $5.3 million, an outflow cash of $772,117 from operating activities and a negative

working capital of $867,325 at December 31, 2019.

In addition, the Company continues to generate operating loss and have

limited cash flow from its operations.

Management believes these factors raise substantial doubt about the Company’s

ability to continue as a going concern for the next twelve months.

The continuation of the Company as a going

concern through the next twelve months is dependent upon the continued financial support from its stockholders or external financing.

Management believes the existing stockholders will provide the additional cash to meet with the Company’s obligations as

they become due.

While the Company believes in the viability of its strategy to increase sales volume and in its ability to raise

additional funds, there can be neither no assurances to that effect, nor no assurance that the Company will be successful in securing

sufficient funds to sustain the operations.

Moreover, the impact of COVID-19 on the Chinese economy may negatively affect our business

in the near future.

have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the discharge

of liabilities in the normal course of business for the foreseeable future.

As reflected in the accompanying consolidated

financial statements, for the years ended December 31, 2020 and 2019, we incurred net losses of $2.3 million and $1.2 million, respectively.

In addition, we reported cash out flow of $0.2 million and $0.1 million from our continuing operating activities for the years ended December

31, 2020 and 2019, respectively.

As of December 31, 2020, we had an accumulated deficit of $7.2 million.

Management believes these factors

raise substantial doubt about our ability to continue as a going concern for the next twelve months.

The continuation of our company as a going concern

through the next twelve months is dependent upon (1) the continued financial support from our stockholders or external financing.

believes that our existing stockholders will provide the additional cash to meet our obligations as they become due, and (2) that it will

be able to implement its business plan to expand our company’s operations and generate sufficient revenues to meet its obligations.

These conditions raise substantial doubt about

the Company’s ability to continue as a going concern.

These financial statements do not include any adjustments to reflect

the possible future effect on the recoverability and classification of assets or the amounts and classifications of liabilities

that may result from the outcome of these uncertainties.

Management believes that the actions presently being taken to obtain additional

funding and implement its strategic plan provides the opportunity for the Company to continue as a going concern.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of Presentation

accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted

in the United States of America (“US GAAP”).

our company’s ability to continue as a going concern.

These financial statements do not include any adjustments to reflect the possible

future effect on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from

the outcome of these uncertainties.

Management believes that the actions presently being taken to obtain additional funding and implement

its strategic plan provides the opportunity for our company to continue as a going concern.

Note 3 –

SUMMARY OF SIGNIFICANT

ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements

have been prepared in conformity with accounting principles generally accepted in the United States of America (“US GAAP”).

The Company’s functional currency is the Chinese Renminbi (“RMB”);

however, the accompanying consolidated financial statements have been translated and presented in United States Dollars (“USD”).

All significant inter-company transactions and balances have been eliminated.

The consolidated financial statements include all

adjustments that, in the opinion of management, are necessary to make the financial statements not misleading.

preparation of the consolidated financial statements is in conformity with generally accepted accounting principles in the United

States of America, which require management to make estimates and assumptions that affect the reported amounts of assets and liabilities

and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts

of revenues and expenses during the reporting periods.

Management makes these estimates using the best information available at

the time the estimates are made.

Actual results could differ from those estimates.

of Consolidation

accompanying consolidated financial statements include Joway Health, its wholly owned subsidiaries, and controlled VIEs.

All significant

inter-company accounts and transactions have been eliminated in the consolidation.

to Accounting Standards Codification Topic 810 “Consolidation”

(“ASC 810”), the Company is required to

include in its consolidated financial statements the financial statements of its variable interest entities (“VIEs”).

ASC 810 requires a VIE to be consolidated by a company if that company is subject to a majority of the risk of loss for the VIE

or is entitled to receive a majority of the VIE’s residual returns.

VIEs are those entities in which a company, through

contractual arrangements, bears the risk of, and enjoys the rewards normally associated with ownership of the entity, and therefore

the company is the primary beneficiary of the entity.

on the various Contractual Agreements, the Company is able to exercise control over the VIEs, and to obtain the full economic

The terms of the exclusive option agreement are currently exercisable and legally enforceable under PRC laws and regulations.

The minimum amount of consideration permitted by the applicable PRC law to exercise the option does not represent a financial

barrier or disincentive for the Company to exercise its rights under the exclusive option agreement.

A simple majority vote of

the Company’s board of directors is required to pass a resolution to exercise its rights under the exclusive option agreement,

for which consent of the shareholder of VIEs is not required.

Therefore, this gives the Company the power to direct the activities

that most significantly impact VIEs’

economic performance.

The Company’s ability to exercise effective control, together

with the consulting service agreements and the equity pledge agreements, give the Company the rights to receive substantially

all of the economic benefits from VIEs in consideration for the services provided by its wholly owned subsidiaries in China.

as the primary beneficiary of VIEs and in accordance with U.S.

GAAP, Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang

Trading, as VIEs of Junhe Consulting, has been consolidated in the Company’s financial statements.

Sales from Joway Shengshi,

Joway Technology, Joway Decoration, and Shengtang Trading are included in the Company’s total sales, their incomes or losses

from operations are consolidated with the Company’s, and the Company’s net income or loss includes net income or loss

from Joway Shengshi, Joway Technology, Joway Decoration, and Shengtang Trading..

Currency Translation

accompanying consolidated financial statements are presented in USD.

however, the accompanying consolidated financial

statements have been translated and presented in United States Dollars (“USD”).

All significant inter-company transactions

and balances have been eliminated.

The consolidated financial statements include all adjustments that, in the opinion of management, are

necessary to make the financial statements not misleading.

Use of Estimates

The preparation of the consolidated financial

statements is in conformity with generally accepted accounting principles in the United States of America, which require management to

make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities

at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods.

makes these estimates using the best information available at the time the estimates are made.

Actual results could differ from those

Reclassification

Certain prior year balances were reclassified

to conform to the current year’s presentation with consideration of reflecting all of the Company’s subsidiaries and VIEs as discontinued

None of these reclassifications had an impact on reported financial position or cash flows for any of the periods presented.

Basis of Consolidation

For the periods prior to the sale of Dynamic Elite,

its subsidiaries, and controlled VIEs, the Company consolidated financial statements include Dynamic Elite, its wholly owned subsidiaries,

and controlled VIEs.

All significant inter-company accounts and transactions have been eliminated in the consolidation.

Foreign Currency Translation

The accompanying consolidated financial statements

are presented in USD.

The functional currency of the Company is RMB.

The consolidated

financial statements are translated into USD from RMB at period-end exchange rates as to assets and liabilities and average exchange

rates as to revenues and expenses.

Equity accounts are translated at their historical exchange rates when the equity transactions

The resulting transaction adjustments are recorded as a component of stockholders’

Gains and losses from

foreign currency transactions are included in net income.

The consolidated financial statements are translated into USD from

RMB at period-end exchange rates as to assets and liabilities and average exchange rates as to revenues and expenses.

Equity accounts

are translated at their historical exchange rates when the equity transactions occurred.

The resulting transaction adjustments are recorded

as a component of stockholders’

Gains and losses from foreign currency transactions are included in net income.

Year ended RMB:

2 unchanged sentences

USD Exchange rate

RMB is not freely convertible into foreign currency and all foreign exchange transactions must take place through authorized institutions.

No representation is made that the RMB amounts could have been, or could be, converted into USD at the rates used in translation.

The RMB is not freely convertible into foreign

currency and all foreign exchange transactions must take place through authorized institutions.

No representation is made that the RMB

amounts could have been, or could be, converted into USD at the rates used in translation.

For the years ended December 31, 2020 and 2019

2018 foreign currency translation adjustments of $(49,044) and $(268,722) respectively, have been reported as other comprehensive

loss in the consolidated financial statements.

Comprehensive Income

comprehensive income is defined as the change in equity during the period from transactions and other events, excluding the changes

resulting from investments by owners and distributions to owners.

Other comprehensive income is not included in the computation

of income tax expense or benefit.

Accumulated other comprehensive income represents the accumulated balance of foreign currency

translation adjustments.

Concentrations

of Credit Risk

Company’s operations are carried out in the PRC.

Accordingly, the Company’s business, financial condition, and results of operations

may be influenced by the political, economic, and legal environment in the PRC, and by the general state of the PRC’s economy.

The Company’s operations in the PRC are subject to specific considerations and significant risks not typically associated with

companies in North America.

The Company’s results may be adversely affected by changes in governmental policies with respect to

laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation,

among other things.

Financial instruments which potentially subject the Company to concentrations of credit risk consist principally

of cash and trade accounts receivable.

Substantially all of the Company’s cash is maintained with state-owned banks within

the PRC, and no deposits are covered by insurance.

The Company has not experienced any losses in such accounts and believes it

is not exposed to any risks on its cash in bank accounts.

Value of Financial Instruments

Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820 (formerly Statement

of Financial Accounting Standard (“SFAS”) No.

157 Fair Value Measurements) establishes a three-tier fair value hierarchy,

which prioritizes the inputs used in measuring fair value as the following:

1—defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

2—defined as inputs other than quoted prices in active markets that are either directly or indirectly observable;

3—defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its

own assumptions.

carrying amounts reported in the balance sheets for cash, accounts receivable, other receivable, accounts payable, other payable,

and amounts due from related parties generally approximate their fair market values based on the short-term maturity of these

foreign currency translation adjustments of $165,413 and $(49,044) respectively, have been reported as other comprehensive loss in the

consolidated financial statements.

Other Comprehensive Income

Other comprehensive income is defined as the change

in equity during the period from transactions and other events, excluding the changes resulting from investments by owners and distributions

Other comprehensive income is not included in the computation of income tax expense or benefit.

Accumulated other comprehensive

income represents the accumulated balance of foreign currency translation adjustments.

Concentrations of Credit Risk

Prior to the Merger Agreement, the Company’s

operations are carried out in the PRC.

Accordingly, the Company’s business, financial condition, and results of operations may be

influenced by the political, economic, and legal environment in the PRC, and by the general state of the PRC’s economy.

The Company’s

operations in the PRC are subject to specific considerations and significant risks not typically associated with companies in North America.

The Company’s results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary

measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things.

Financial instruments which

potentially subject the Company to concentrations of credit risk consist principally of cash and trade accounts receivable.

Substantially

all of the Company’s cash is maintained with state-owned banks within the PRC, and no deposits are covered by insurance.

has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts.

Fair Value of Financial Instruments

Financial Accounting Standards Board (“FASB”)

Accounting Standards Codification (“ASC”) 820 (formerly Statement of Financial Accounting Standard (“SFAS”) No.

157 Fair Value Measurements) establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value

as the following:

Level 1—defined as observable inputs such as quoted prices in active markets for identical assets or liabilities;

Level 2—defined as inputs other than quoted prices in active markets that are either directly or indirectly observable;

Level 3—defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The carrying amounts reported in the balance sheets

for cash, accounts receivable, other receivable, accounts payable, other payable, and amounts due from related parties generally approximate

their fair market values based on the short-term maturity of these instruments.

ASC 825-10 “Financial Instruments”

allows entities to voluntarily choose to measure certain financial

assets and liabilities at fair value (fair value option).

The fair value option may be elected on an instrument-by-instrument

basis and is irrevocable, unless a new election date occurs.

If the fair value option is elected for an instrument, unrealized

gains and losses for that instrument should be reported in earnings at each subsequent reporting date.

The Company did not elect

to apply the fair value option to any outstanding instruments.

financial reporting purposes, the Company considers all highly liquid financial instruments with an original maturity of three

months or less to be cash equivalents.

The Company had no cash equivalents at any point during the period of the financial statements

Balances at financial institutions or state-owned banks within the PRC are not covered by insurance.

The Company has

not experienced any losses in such accounts and believes it is not exposed to any significant risks on its cash in bank accounts.

Accounts receivable are presented net of

an allowance for doubtful accounts.

The Company maintains allowances for doubtful accounts for estimated losses.

periodic basis, the Company reviews the composition of the accounts receivable and analyzes historical bad debts, customer

concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the

adequacy of these allowances.

Accounts are written off after exhaustive efforts at collection.

As of December 31, 2019 and

2018, the Company allowance $2,591 and $2,628 for doubtful accounts, respectively.

Inventories are stated at the lower of cost, as determined by the

specific identification method on contract level (for each individual contract, inventories cost flow is determined by weighted-average

method), or the net realizable value, which is determined on selling prices less any further costs expected to be incurred for

completion and disposal.

The Company regularly evaluates the composition of its inventories to identify slow-moving and obsolete

inventories to determine whether valuation allowance is required.

As of December 31, 2019 and 2018, the Company recorded $106,997

and $77,149 for inventory valuation allowance, respectively.

Advances to suppliers represent the cash paid

in advance for inventory items or construction in progress.

The advance payments are meant to ensure preferential pricing and

The amounts advanced under such arrangements totalled $56,418 and $119,022 as of December 31, 2019 and 2018, respectively.

in which the Company has a 20% to 50% interest is accounted for by the equity method.

Under the equity method the carrying value

of the investment is adjusted for the Company’s proportionate share of the investee’s income or loss.

in which the Company has less than a 20% interest is accounted for by the cost method.

Under the cost method, investments are

carried at cost and income is recorded when dividends are received from those investees.

Plant, and Equipment

plant and equipment are stated at cost less accumulated depreciation, and include expenditures that substantially increase the

useful lives of existing assets.

is computed using the straight-line method over the estimated useful lives of the assets.

Estimated useful lives are as follows:

furniture and equipment

cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or

loss is included in the consolidated statements of operations.

Maintenance, repairs, and minor renewals are charged directly to

expenses as incurred.

Significant renewals and betterment to buildings and equipment are capitalized.

Leasehold improvements are

depreciated over the lesser of the useful life or the life of the lease.

assets mainly consist of land use rights.

All land located in the PRC is owned by the government and cannot be sold to any individual

The land use rights granted to the Company are being amortized using the straight-line method over the lease term

Other intangible assets are software programs that are amortized over their estimated useful life of 10 years.

of Long-Lived Assets

assets of the Company are reviewed annually as to whether their carrying value has become impaired, pursuant to the guidelines

established in FASB ASC 360 (formerly SFAS No.

144 Accounting for the Impairment or Disposal of Long-Lived Assets ).

Company considers assets to be impaired if the carrying value exceeds the future projected cash flows from the related operations.

The Company also re-evaluates the periods of depreciation and amortization to determine whether subsequent events and circumstances

warrant revised estimates of useful lives.

The Company did not record any impairment loss for the years ended December 31, 2019

The Company recognizes revenue when control

of promised goods or services is transferred to the company’s customers, in an amount that reflects the consideration the

Company expects to be entitled to in exchange for those goods or services.

With respect to sales of product to both franchisee and non-franchisee

customers, the Company transfers control, invoices the customer and recognizes revenue upon shipment to the customer.

are based on fixed price lists that are different depending on whether the price list is for franchisee customers or for non-franchisee

Sales, value add and other taxes collected concurrent with revenue-producing activities are excluded from revenue.

Shipping costs are included in selling expenses

and totalled $49,399 and $111,089 for the years ended December 31, 2019 and 2018, respectively.

Company is governed by the Income Tax Law and associated legislations of the PRC.

entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option).

The fair value option

may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs.

If the fair value option is

elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting

The Company did not elect to apply the fair value option to any outstanding instruments.

Revenue Recognition

The Company recognizes revenue when control of

promised goods or services is transferred to the company’s customers, in an amount that reflects the consideration the Company expects

to be entitled to in exchange for those goods or services.

Prior to the Merger Agreement, with respect to

sales of product to both franchisee and non-franchisee customers, the Company transfers control, invoices the customer and recognizes

revenue upon shipment to the customer.

Sales prices are based on fixed price lists that are different depending on whether the price list

is for franchisee customers or for non-franchisee customers.

Sales, value add and other taxes collected concurrent with revenue-producing

activities are excluded from revenue.

The Company accounts for income taxes in accordance

1 unchanged sentence

(formerly SFAS No.

109 Accounting for Income Taxes) , which is an asset and

liability approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences

of events that have been recognized in the Company’s financial statements or tax returns.

ASC 740 additionally requires the establishment

of a valuation allowance to reflect the likelihood of realization of deferred tax assets.

Realization of deferred tax assets is

dependent upon future earnings, if any, of which the timing and amount are uncertain.

to ASC 740, the evaluation of a tax position is a two-step process.

The first step is to determine whether it is more likely than

not that a tax position will be sustained upon examination, including the resolution of any related appeals or litigation based

on the technical merits of that position.

The second step is to measure a tax position that meets the more-likely-than-not threshold

to determine the amount of benefit to be recognized in the financial statements.

A tax position is measured at the largest amount

of benefit that is greater than 50% likelihood of being realized upon ultimate settlement.

Tax positions that previously failed

to meet the more-likely-than-not recognition threshold should be recognized in the first subsequent period in which the threshold

Previously recognized tax positions that no longer meet the more-likely-than-not criteria should be de-recognized in the

first subsequent financial reporting period in which the threshold is no longer met.

ASC 740 also provides guidance on de-recognition,

classification, interest and penalties, accounting in interim periods, disclosures, and transition.

and Diluted Earnings per Share

Company reports earnings per share in accordance with FASB ASC 260 “Earnings per share”.

The Company’s basic

earnings per share are computed using the weighted average number of shares outstanding for the periods presented.

Diluted earnings

per share are computed based on the assumption that any dilutive options or warrants were converted or exercised.

computed by applying the treasury stock method.

Under this method, the Company’s outstanding stock warrants are assumed

to be exercised, and funds thus obtained were assumed to be used to purchase common stock at the average market price during the

109 Accounting for Income Taxes) , which is an asset and liability

approach that requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that

have been recognized in the Company’s financial statements or tax returns.

ASC 740 additionally requires the establishment of a

valuation allowance to reflect the likelihood of realization of deferred tax assets.

Realization of deferred tax assets is dependent upon

future earnings, if any, of which the timing and amount are uncertain.

According to ASC 740, the evaluation of a tax

position is a two-step process.

The first step is to determine whether it is more likely than not that a tax position will be sustained

upon examination, including the resolution of any related appeals or litigation based on the technical merits of that position.

step is to measure a tax position that meets the more-likely-than-not threshold to determine the amount of benefit to be recognized in

the financial statements.

A tax position is measured at the largest amount of benefit that is greater than 50% likelihood of being realized

upon ultimate settlement.

Tax positions that previously failed to meet the more-likely-than-not recognition threshold should be recognized

in the first subsequent period in which the threshold is met.

Previously recognized tax positions that no longer meet the more-likely-than-not

criteria should be de-recognized in the first subsequent financial reporting period in which the threshold is no longer met.

provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosures, and transition.

Basic and Diluted Earnings per Share

The Company reports earnings per share in accordance

with FASB ASC 260 “Earnings per share”.

The Company’s basic earnings per share are computed using the weighted average

number of shares outstanding for the periods presented.

Diluted earnings per share are computed based on the assumption that any dilutive

options or warrants were converted or exercised.

Dilution is computed by applying the treasury stock method.

Under this method, the Company’s

outstanding stock warrants are assumed to be exercised, and funds thus obtained were assumed to be used to purchase common stock at the

average market price during the period.

There were no dilutive instruments outstanding during the years ended December 31, 2020 and 2019.

Company follows FASB ASC 280-Segment Reporting, which requires that companies disclose segment data based on how management makes

decision about allocating resources to segments and evaluating their performance.

the years ended December 31, 2019 and 2018, management has determined that the Company is operating in three reportable business

segments, (1) Healthcare Knit Goods Series, (2) Daily Healthcare and Personal Care Series, and (3) Wellness House and Activated

Water Machine Series.

The Company’s reportable segments are strategic business units that offer different products.

They are managed

separately based on the fundamental differences in their operations.

Issued Accounting Pronouncements

January 2017, the FASB issued ASU No.

2017-04, Simplifying the Test for Goodwill Impairment.

The guidance removes Step 2 of the

goodwill impairment test, which requires a hypothetical purchase price allocation.

A goodwill impairment will now be the amount

by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill.

should be adopted on a prospective basis for the annual or any interim goodwill impairment tests beginning after December 15, 2019.

Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017.

Company adopted the standard in 2019.

Recently Issued Accounting Pronouncements

In June 2016, the FASB issued ASU No.

Financial Instruments-Credit Losses (Topic 326), which requires entities to measure all expected credit losses for financial assets held

at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts.

This replaces the

existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost.

guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.

Early application

will be permitted for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018.

The Company adopted the standard in 2019.

Adoption of the standard did not have a significant impact on the Company’s consolidated

statement of earnings in 2019.

In June 2018, the FASB issued ASU 2018-07,

“Stock Compensation (Topic 718):

Improvements to Nonemployee Share-Based Payment Accounting,”

which simplifies the

accounting for share-based payments granted to nonemployees for goods and services and aligns most of the guidance on such payments

to nonemployees with the requirements for share-based payments granted to employees.

ASU 2018-07 becomes effective for the Company

on January 1, 2019.

In August 2018, the FASB issued Accounting Standard

Update (“ASU”) No.

2018-13, Fair Value Measurement (Topic 820), which modifies the disclosure requirements on fair value measurements

in Topic 820, Fair Value Measurement, including, among other changes, the consideration of costs and benefits when evaluating disclosure

requirements.

For public companies, the amendments are effective for annual reporting periods beginning after December 15, 2019, including

interim periods within those annual periods.

Early adoption is permitted.

The Company adopted the standard in 2019.

Adoption of the standard did not have

a significant impact on the Company's consolidated statement of earnings in 2019.

In February 2016, the FASB issued ASU No.

2016-02, Leases (Topic 842).

The standard outlined a comprehensive lease accounting model that superseded the previous lease

guidance and required lessees to recognize lease liabilities and corresponding right-of-use assets for all leases with lease terms

greater than 12 months.

The guidance also changed the definition of a lease and expanded the disclosure requirements of lease arrangements.

The Company adopted the standard on December 15, 2019.

Adoption of the standard did not have a significant impact on the Company's

consolidated statement of earnings in 2019.

June 2016, the FASB issued ASU No.

2016-13, Financial Instruments-Credit Losses (Topic 326), which requires entities to measure

all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions,

and reasonable and supportable forecasts.

This replaces the existing incurred loss model and is applicable to the measurement

of credit losses on financial assets measured at amortized cost.

The Company is currently assessing the impact that adopting

this new accounting guidance will have on the Company’s financial statements and footnote disclosures.

In December 2019, the FASB issued ASU No.

Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which is intended to simplify various

aspects related to accounting for income taxes.

ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also

clarifies and amends existing guidance to improve consistent application.

This guidance is effective for fiscal years, and interim periods

within those fiscal years, beginning after December 15, 2019.

Early application will be permitted for all entities for fiscal

years, and interim periods within those fiscal years, beginning after December 15, 2018.

The Company adopted the standard in 2019.

Adoption of the standard did not have a significant impact on the Company’s consolidated statement of earnings in 2019.

recent accounting pronouncements issued by the FASB, including its Emerging Issues Task Force, the American Institute of Certified

Public Accountants, and the SEC did not or are not believed by management to have a material impact on the Company’s present

or future consolidated financial statements.

ACCOUNTS RECEIVABLE

receivable consisted of the following:

Accounts receivable

allowance for bad debt

the years ended December 31, 2019 and 2018, the Company allowance $2,591 and $2,628 for doubtful accounts, respectively.

consist of the following:

Raw materials

Finished goods

Low value consumables

impairment loss

Inventory, net

value consumables represent low value and easily worn out items and are amortized on an equal-split amortization method.

to this method, half the value of the low value consumable is be amortized once used and the remaining half value is be amortized

when disposed of.

the years ended December 31, 2019 and 2018, the Company recognized $106,997 and $77,149, respectively, as impairment loss

from inventory.

PROPERTY, PLANT AND EQUIPMENT

plant and equipment consist of the following:

Operating Equipment

Office furniture and equipment

accumulated depreciation

Property, plant and equipment, net

expense for the years ended December 31, 2019 and 2018 amounted to $406,849 and $426,788, respectively.

within those fiscal years, beginning after December 15, 2020, with early adoption permitted.

The Company is currently evaluating the impact

of this standard on its consolidated financial statements and related disclosures.

Other accounting standards that have been issued

or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a

material impact on the Company’s consolidated financial statements upon adoption.

Note 4 –

DECONSOLIDATION

On November 20, 2020, Joway Health entered into

a Merger Agreement (the “Merger Agreement”) with Dynamic Elite International Limited, a British Virgin Islands company and

a wholly-owned subsidiary of the Company (“Dynamic Elite”), Crystal Globe Limited, a British Virgin Islands company (“Crystal

Globe”) and Joway Merger Subsidiary Limited, a British Virgin Islands company and a wholly-owned subsidiary of Crystal Globe (“Merger

The Merger Agreement provides that, upon the terms and subject to the satisfaction or waiver of the conditions set forth

therein, Merger Sub will be merged with and into Dynamic Elite (the “Merger”), with Dynamic Elite continuing as the surviving

corporation as a wholly-owned subsidiary of Crystal Globe.

Crystal Globe, as the majority shareholder holding

approximately 86.81% of the Company, is also the sole shareholder of Dynamic Elite after the Merger.

Jinghe Zhang, as the President,

Chief Executive Officer, Chairman and Director, and the majority beneficial owner of the Company, also serves as sole shareholder and

executive director of Crystal Globe.

As a result, the Company and Dynamic Elite are under common control of Crystal Globe and Mr.

Pursuant to the terms of the Merger Agreement,

at the effective time of the Merger (the “Effective Time”) and as a result of the Merger, the ordinary shares of common stock

of Dynamic Elite issued and outstanding immediately prior to the Effective Time, all of which are held by the Company, will be cancelled

and extinguished.

In accordance with the Merger Agreement, Crystal Globe has offered a cash consideration of $0.045 per share for outstanding

shares of Joway Health’s common stock (the “Merger Consideration”).

As of November 20, 2020, Joway Health reported 20,054,000

shares of common stock outstanding.

As a result, Joway Health recognized a loss of $1,340,795 from this transaction.

In January 2021, Joway Health had received $119,070

from Crystal Globe and distributed proportionately to the Company’s minority shareholders, other than Crystal Globe, which represents

2,646,000 shares of Joway Health’s common stock.

Since the remaining 17,408,000 shares of Joway Health’s common stock is owned

by Crystal Globe, the $0.045 per share payment for the 17,408,000 shares is offset.

The following is a reconciliation of the deconsolidation:

Selling price

Disposed assets and liabilities:

Current assets

Intangible assets

assets consist of the following:

Land use rights

Other intangible assets

accumulated amortization

Intangible assets, net

expense of intangible assets for the years ended December 31, 2019 and 2018 was $19,000 and $20,503, respectively.

estimated amortization expense for the next five years is as the following:

Estimated amortization expense

for the year ending December 31,

RELATED PARTY TRANSACTIONS

due to related parties consist of the following:

Shenyang Joway Industrial Development Co., Ltd.

with Shenyang Joway

Joway Industrial Development Co., Ltd.

(“Shenyang Joway”) was formed in 2005 in Shenyang, China by Mr.

Zhang and three other individuals.

Zhang holds more than 50% of the equity in Shenyang Joway.

Shenyang Joway was in the

business of marketing and distributing clothing and related products to other companies.

Zhang decided to shut

down the operations of Shenyang Joway in order to focus his attention on Joway Shengshi’s business.

Shenyang Joway has

ceased operations, although it still exists as a legal entity, and Joway Shengshi was able to find new suppliers with no material

adverse impact to the Company.

May 7, 2007, the Company’s subsidiary Joway Shengshi entered into an agreement with Shenyang Joway pursuant to which

Joway Shengshi and Shenyang Joway agreed to provide each other with interest-free, unsecured advances for working capital.

May 10, 2007, the Company’s subsidiary Joway Technology and Shenyang Joway entered into an agreement pursuant to which

Joway Technology and Shenyang Joway agreed to provide each other with interest-free, unsecured advances for working capital.

Through December 31, 2008, Joway Technology advanced $58,568 to Shenyang Joway, which was paid off by Shenyang Joway to Joway

Technology in 2009.

Through December 31, 2018, Shenyang Joway advanced an aggregate of $912,645 to Joway Shengshi and Joway

During the years of 2019 and 2018, the Company repaid $118,458 and received $116,219 of these advances,

respectively.

As of December 31, 2019, the total unpaid principal balance due to Shenyang Joway for advances was $0.

Joway was cancelled in 2019.

with Jinghe Zhang

December 1, 2009, the Company, through its subsidiary Joway Shengshi, entered into a royalty-free license agreement with Jinghe

Zhang, our President, Chief Executive Officer and director.

Pursuant to the license agreement, we are authorized to use the

trademark “Joway”

for a term of nine years and five patents from December 1, 2009 till the expiration dates of

May 10, 2007, Joway Shengshi entered into a cash advance agreement with Jinghe Zhang, our President, Chief Executive Officer

and director.

Pursuant to the agreement, Jinghe Zhang agreed to advance operating capital to Joway Shengshi.

The advances are

interest free, unsecured, and have no specified repayment terms.

The agreement is valid throughout Joway Shengshi’s

term of operation.

During the period beginning May 17, 2007 (inception of Joway Shengshi) through December 31, 2019, Joway

Shengshi received cash advances in the aggregate principal amount of $6,113,326 from Jinghe Zhang of which $4,632,811 has

During the years of 2019 and 2018, the Company received $954,987 and $398,729 of advances, respectively.

December 31, 2019, the total unpaid principal balance due to Mr.

Jinghe Zhang was $1,480,515.

amounts owed to related parties are non-interest bearing and have no specified repayment terms.

Company’s operations in the People’s Republic of China are subject to the Income Tax Law of the People’s Republic

Pursuant to the PRC Income Tax Laws, the Company is subject to the Enterprise Income Tax (“EIT”) which is

generally a statutory rate of 25% beginning January 2008, on income as reported in its statutory financial statements after appropriate

tax adjustments.

table below summarizes the differences between the PRC statutory federal rate and the Company’s effective tax rate:

For the year ended

Tax computed at China statutory rates

Effect of losses

Effective rate

components of deferred income tax asset are as follow:

As of December 31,

Deferred income tax asset:

Net operating loss carry forwards

Valuation allowance

of December 31, 2019, the Company has a net operating loss carry forward for tax purposes of approximately $3.08 million available

to offset future taxable income through 2024.

Company’s income tax returns since inception are subject to audit by regulatory authorities.

Changes in tax laws and rates

could also affect recorded deferred tax assets and liabilities in the future.

Management is not aware of any such changes that

would have a material effect on the Company’s results of operations, cash flows or financial position.

The calculation of

our tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations.

FASB ASC Topic

740, Income Taxes provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not

that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based

on the technical merits.

ASC Topic 740 also provides guidance on measurement, derecognition, classification, interest and penalties,

accounting in interim periods, disclosure and transition.

recognize tax liabilities in accordance with ASC Topic 740 and we adjust these liabilities when our judgment changes as a result

of the evaluation of new information not previously available.

Due to the complexity of some of these uncertainties, the ultimate

resolution may result in a payment that is materially different from our current estimate of the tax liabilities.

These differences

will be reflected as increases or decreases to income tax expense in the period in which they are determined.

STATUTORY RESERVES

to the laws and regulations of the PRC, the Company’s PRC subsidiaries are required to allocate a portion of their after-tax

income to the statutory reserves funds.

The minimum statutory reserves allocation is 10% of after tax income until the reserves

reach 50% of the entities’

registered capital or members’

The reserve funds are not transferable to the Company

in the form of cash dividends, loans or advances.

Thus, the reserve funds are not available for distribution except in liquidation.

For the years ended December 31, 2019 and 2018, the Company did not allocate any after-tax income to the statutory reserves.

2019 and 2018, the Company operated in three reportable business segments - (1) Healthcare Knit Goods Series, (2) Daily

Healthcare and Personal Care Series, and (3) Wellness House and Activated Water Machine Series.

The Company’s reportable

segments are strategic business units that offer different products.

They are managed separately based on the fundamental

differences in their operations.

Information with respect to these reportable business segments is as the

the year ended December 31, 2019

from operations

and amortization

Healthcare Knit

Daily Healthcare and Personal Care Series

Wellness House and Activated Water Machine Series

Segment Totals

Other Loss, net

Unallocated Assets

$ (1,237,941 )

the year ended December 31, 2018

Loss from operations

Depreciation and amortization

Healthcare Knit Goods Series

Daily Healthcare and Personal Care Series

Wellness House and Activated Water Machine Series

Segment Totals

Other Loss, net

Income tax benefits

Unallocated Assets

$ (1,522,147 )

FRANCHISE REVENUES

Company enters into franchise agreements to develop retail outlets for the Company’s products.

These agreements provide that franchisees

will sell Company products exclusively at a predetermined retail price.

In exchange, the Company provides them with geographic

exclusivity, discounted products, training, and support.

The agreements also require franchisees to adhere to certain standards

of product merchandising, promotion, and presentment.

The agreements also prohibit franchisees from selling competitors’

The agreements do not require any initial franchise fees from the franchisees, nor do they require the franchisees to

pay continuing royalties.

The agreements do not require the franchisees to purchase any minimum levels of product, but do require

that they make at least one purchase during each year.

The Company does not manage the franchisees’

levels of product.

hold periodic conferences, assisted by the Company’s marketing department, to promote product awareness and introduce new

The franchising agreements are generally for terms of three years and are renewable at the mutual agreement of both

The franchising agreements are cancelable at the Company’s discretion if franchisees violate the terms of the agreements.

following is a breakdown of revenue between franchise and non-franchise customers:

Year ended December 31,

Sales to franchise customers

Sales to non-franchise customers

Change in franchise outlets:

Number of franchise outlets open at beginning of the year

Number of franchise outlets opened during the year

Number of franchise outlets closed during the year

Number of franchise outlets open at the end of the year

CONDENSED FINANCIAL INFORMATION OF REGISTRANT

following condensed financial information of the Company includes the US parent only balance sheets as of December 31, 2019 and

2018, and the US parent company only statements of operations, and cash flows for the years ended December 31, 2019 and 2018:

Balance Sheets:

As of December 31,

Investment in subsidiaries and VIEs

L I A B I L I T I E S A N D S T O C K H O L

D E R S’

Due to related parties

Total liabilities

STOCKHOLDERS’

Preferred authorized;

stock - par value $0.001;

1,000,000 shares no shares issued and outstanding

Common authorized;

December stock - par value $0.001;

200,000,000 shares 20,054,000 shares issued and outstanding at 31, 2019 and 2018

Additional paid-in-capital

Retained earnings

Total stockholders’

Total liabilities and stockholders’

Statements of Operations

For the Year ended

Share of losses from investment in subsidiaries and VIEs

$ (1,168,402 )

$ (1,769,385 )

OPERATING EXPENSES

General and administrative expenses

Statements of Cash Flows

For the Year ended

CASH FLOWS FROM OPERATING ACTIVITIES:

$ (1,286,985 )

Accumulated other comprehensive income

Loss from disposal of discontinued component, net of income tax

$ (1,340,795 )

Adjustments to reconcile net loss to net cash

provided by operating activities

Share of earnings from investment in subsidiaries and VIEs

Net cash used in operating activities

CASH FLOWS FROM FINANCING ACTIVITIES:

Advance from shareholders

Net cash provided by financing activities

NET INCREASE IN CASH

CASH, beginning of year

CASH, end of year

of Presentation

Company records its investment in its subsidiaries and VIEs under the equity method of accounting.

Such investment is presented

as “Investment in subsidiaries and VIEs”

on the condensed balance sheets and shares of the subsidiaries and VIEs’

profits is presented as “Share of earnings from investment in subsidiaries and VIEs”

in the condensed statements of

information and footnote disclosures normally included in financial statements prepared in conformity with accounting principles

generally accepted in the United States of America have been condensed or omitted.

The parent only financial information has been

derived from the Company’s consolidated financial statements and should be read in conjunction with the Company’s

consolidated financial statements.

PRC laws and regulations, the Company’s PRC subsidiaries and VIEs are restricted in their ability to transfer certain of

their net assets to the Company in the form of dividend payments, loans or advances.

The restricted net assets of the Company’s

PRC subsidiaries and VIEs amounted to $3,032,832 and $4,264,192 as of December 31, 2019 and 2018, respectively.

addition, the Company’s operations and revenues are conducted and generated in the PRC, all of the Company’s revenues

being earned and currency received are denominated in RMB.

RMB is subject to the foreign exchange control regulations 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 US Dollars.

I of Article 5-04 of Regulation S-X requires the condensed financial information of the Company to 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

For purposes of this test, restricted net assets of consolidated subsidiaries shall mean that amount of the registrant’s

proportionate share of net assets of consolidated subsidiaries (after intercompany eliminations) which as of the end of the most

recent fiscal year may not be transferred to the parent company by subsidiaries in the form of loans, advances or cash dividends

without the consent of a third party.

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 subsidiaries and VIEs exceed

25% of the consolidated net assets of the Company.

Note 5 –

RECEIVABLE FROM RELATED PARTY

Receivable from related party consist of the following:

Crystal Globe

The receivable from Crystal Globe is related to the Merger Agreement

which is part of the Merger Consideration for Joway Health’s minority shareholders who hold 2,646,000 shares of Joway Health’s

common stock.

In January 2021, Joway Health had received $119,070

from Crystal Globe and distributed proportionately to the Company’s minority shareholders.

Note 6 –

SPECIAL DIVIDEND PAYABLE

As of December 31, 2020 and 2019, the Company

reported $119,070 and $0 as special dividend payables, respectively.

The payables are related to the Merger Agreement which is part of

the Merger Consideration for Joway Health’s minority shareholders who hold 2,646,000 shares of Joway Health’s common stock.

On November 20, 2020, Joway Health entered into

a Merger Agreement (the “Merger Agreement”) with Dynamic Elite International Limited, a British Virgin Islands company and

a wholly-owned subsidiary of the Company (“Dynamic Elite”), Crystal Globe Limited, a British Virgin Islands company (“Crystal

Globe”) and Joway Merger Subsidiary Limited, a British Virgin Islands company and a wholly-owned subsidiary of Crystal Globe (“Merger

The Merger Agreement provides that, upon the terms and subject to the satisfaction or waiver of the conditions set forth

therein, Merger Sub will be merged with and into Dynamic Elite (the “Merger”), with Dynamic Elite continuing as the surviving

corporation as a wholly-owned subsidiary of Crystal Globe.

Crystal Globe, as the majority shareholder holding

approximately 86.81% of the Company, is also the sole shareholder of Dynamic Elite after the Merger.

Jinghe Zhang, as the President,

Chief Executive Officer, Chairman and Director, and the majority beneficial owner of the Company, also serves as sole shareholder and

executive director of Crystal Globe.

As a result, the Company and Dynamic Elite are under common control of Crystal Globe and Mr.

Pursuant to the terms of the Merger Agreement,

at the effective time of the Merger (the “Effective Time”) and as a result of the Merger, the ordinary shares of common stock

of Dynamic Elite issued and outstanding immediately prior to the Effective Time, all of which are held by the Company, will be cancelled

and extinguished.

In accordance with the Merger Agreement, Crystal Globe has offered a cash consideration of $0.045 per share for outstanding

shares of Joway Health’s common stock (the “Merger Consideration”).

As of November 20, 2020, Joway Health reported 20,054,000

shares of common stock outstanding.

As a result of the Merger Agreement, Joway Health

needs to distribute proportionately the Merger Consideration to the Company’s shareholders.

In January 2021, Joway Health had received

$119,070 from Crystal Globe and distributed proportionately to the Company’s minority shareholders, other than Crystal Globe, which

represents 2,646,000 shares of Joway Health’s common stock.

Since the remaining 17,408,000 shares of Joway Health’s common

stock is owned by Crystal Globe, the $0.045 per share payment for the 17,408,000 shares is offset.

Note 7 –

RELATED PARTY TRANSACTIONS

Payables due to related parties consist of the following:

Joway Shengshi

The amounts owed to related parties are non-interest bearing and have

no specified repayment terms.

Transactions with Jinghe Zhang

The Company is a shell company and has no cash,

Jinghe Zhang, our President, Chief Executive Officer and director, agreed to advance operating capital to the Company.

years of 2020 and 2019, the Company received $158,930 and $55,625, respectively, from Mr.

Jinghe Zhang.

As of December 31, 2020, the total

unpaid principal balance due to Mr.

Jinghe Zhang for advances was $233,693.

As of April 28, 2021, Mr.

Jinghe Zhang released

the Company from $295,928.47 of indebtedness owed to him from the Company.

There is no further indebtedness owed from or to Mr.

Zhang by the Company.

Transactions with Joway Shengshi

Joway Shengshi is a company of the discontinued

Jinghe Zhang owns 99% of the equity interest in Joway Shengshi.

During the years of 2020 and 2019, we received $23,585

and $51,958 of advances from Joway Shengshi, respectively.

As of December 31, 2020, the total unpaid principal balance due to Joway Shengshi

for advances was $459,853.

As of April 28, 2021, Joway Shengshi released the Company from $463,697.67

of indebtedness owed to it from the Company.

There is no further indebtedness owed from or to Joway Shengshi by the Company.

Disposal of all of Joway Health’s subsidiaries and VIEs

On November 20, 2020, Joway Health entered into

a Merger Agreement (the “Merger Agreement”) with Dynamic Elite International Limited, a British Virgin Islands company and

a wholly-owned subsidiary of the Company (“Dynamic Elite”), Crystal Globe Limited, a British Virgin Islands company (“Crystal

Globe”) and Joway Merger Subsidiary Limited, a British Virgin Islands company and a wholly-owned subsidiary of Crystal Globe (“Merger

The Merger Agreement provides that, upon the terms and subject to the satisfaction or waiver of the conditions set forth

therein, Merger Sub will be merged with and into Dynamic Elite (the “Merger”), with Dynamic Elite continuing as the surviving

corporation as a wholly-owned subsidiary of Crystal Globe.

Crystal Globe, as the majority shareholder holding

approximately 86.81% of the Company, is also the sole shareholder of Dynamic Elite after the Merger.

Jinghe Zhang, as the President,

Chief Executive Officer, Chairman and Director, and the majority beneficial owner of the Company, also serves as sole shareholder and

executive director of Crystal Globe.

As a result, the Company and Dynamic Elite are under common control of Crystal Globe and Mr.

Pursuant to the terms of the Merger Agreement,

at the effective time of the Merger (the “Effective Time”) and as a result of the Merger, the ordinary shares of common stock

of Dynamic Elite issued and outstanding immediately prior to the Effective Time, all of which are held by the Company, will be cancelled

and extinguished.

In accordance with the Merger Agreement, Crystal Globe has offered a cash consideration of $0.045 per share for outstanding

shares of Joway Health’s common stock (the “Merger Consideration”).

As of November 20, 2020, Joway Health reported 20,054,000

shares of common stock outstanding.

As a result of the Merger Agreement, Joway Health

needs to distribute proportionately the Merger Consideration to the Company’s shareholders.

In January 2021, Joway Health had received

$119,070 from Crystal Globe and distributed proportionately to the Company’s minority shareholders, other than Crystal Globe, which

represents 2,646,000 shares of Joway Health’s common stock.

Since the remaining 17,408,000 shares of Joway Health’s common

stock is owned by Crystal Globe, the $0.045 per share payment for the 17,408,000 shares is offset.

Note 8 –

Upon the Company executed the Merger Agreement

on December 31, 2020, no provision was made for federal income taxes since the Company has significant net operating losses.

The Company’s income tax returns since inception

are subject to audit by regulatory authorities.

Changes in tax laws and rates could also affect recorded deferred tax assets and liabilities

in the future.

Management is not aware of any such changes that would have a material effect on the Company’s results of operations,

cash flows or financial position.

The calculation of our tax liabilities involves dealing with uncertainties in the application of complex

tax laws and regulations.

FASB ASC Topic 740, Income Taxes provides that a tax benefit from an uncertain tax position may be recognized

when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or

litigation processes, based on the technical merits.

ASC Topic 740 also provides guidance on measurement, derecognition, classification,

interest and penalties, accounting in interim periods, disclosure and transition.

We recognize tax liabilities in accordance with

ASC Topic 740 and we adjust these liabilities when our judgment changes as a result of the evaluation of new information not previously

Due to the complexity of some of these uncertainties, the ultimate resolution may result in a payment that is materially different

from our current estimate of the tax liabilities.

These differences will be reflected as increases or decreases to income tax expense

in the period in which they are determined.

Note 8 –

SUBSEQUENT EVENTS

As of April 29, 2021, Jun Pang and Haibo Fan resigned

as independent directors of the Company.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures