What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2022-03-15 compared with 2021-03-23 · 871 added, 649 removed, 107 unchanged (93% of the section changed)

Corporate History

IT Tech Packaging,

(the “Company”) was incorporated in the State of Nevada on December 9, 2005, under the name “Carlateral,

Through the steps described below, we became the holding company for Hebei Baoding Dongfang Paper Milling Company Limited

(“Dongfang Paper”), a producer and distributor of paper products in China, on October 29, 2007, and effective December

21, 2007, we changed our name to “Orient Paper, Inc.”.

Effective on August

1, 2018, we changed our corporate name to IT Tech Packaging, Inc.

The name change was effected through a parent/subsidiary short-form

merger of IT Tech Packaging, Inc., our wholly-owned Nevada subsidiary formed solely for the purpose of the name change, with and

IT Tech Packaging, Inc.

“Company” or “IT Tech Packaging”) is not an operating company but a Nevada holding company with operations primarily

conducted by its subsidiary and variable interest entity, or VIE.

We operated our business in China through our PRC subsidiary, Baoding

Shengde Paper Co., Ltd.

( the “PRC Subsidiary” or “Baoding Shengde”) and Hebei Baoding Dongfang Paper Milling

Company Limited (“Dongfang Paper”), which we refer to as our VIE in this annual report, and rely on contractual arrangements

among our PRC subsidiary, the VIE and VIE’s shareholders to operate our business in China.

Investors in our common stock should

be aware that they may never directly hold equity interests in the Chinese operating entities, but rather purchasing equity solely in

IT Tech Packaging Inc., our Nevada holding company, which does not directly own substantially all of our business in China conducted by

our PRC Subsidiary and VIE.

of our corporate structure, we as well as the investors are subject to unique risks due to uncertainty of the interpretation and the

application of the PRC laws and regulations, including but not limited to regulatory review of oversea listing of PRC companies through

a special purpose vehicle.

We are also subject to the risks of uncertainty about any future actions of the PRC government in this regard.

We may also be subject to sanctions imposed by PRC regulatory agencies including Chinese Securities Regulatory Commission (“CSRC”)

if we fail to comply with their rules and regulations.

Although the Company is currently not required to obtain permission from any of

the PRC central or local government to obtain such permission and has not received any denial to list on the U.S.

exchange, our operations

could be adversely affected, directly or indirectly, by existing or future laws and regulations relating to its business or industry,

if we inadvertently conclude that such approvals are not required when they are, or applicable laws, regulations, or interpretations

change and we are required to obtain approval in the future.

For a description of relevant risks related to our corporate structure,

see “ Risk Factors – Risks Relating to Doing Business in China” and “Risk Factors – Risks Relating to

Our Corporate Structure.”

IT Tech Packaging was incorporated

in the State of Nevada on December 9, 2005, under the name “Carlateral, Inc.” Through the steps described below, we became

the holding company with operations primarily conducted by our subsidiaries and our VIE, Dongfang Paper, a producer and distributor of

paper products in China, on October 29, 2007.

Effective on August 1, 2018, we changed our corporate name to IT Tech Packaging, Inc.

name change was effected through a parent/subsidiary short-form merger of IT Tech Packaging, Inc., our wholly-owned Nevada subsidiary

formed solely for the purpose of the name change, with and into us.

We were the surviving entity.

In connection with the name change, our common stock began being traded under a new NYSE

symbol, “ITP,”

at such time.

On October 29, 2007,

pursuant to an agreement and plan of merger (the “Merger Agreement”), the Company acquired Dongfang Zhiye Holding Limited

(“Dongfang Holding”), a corporation formed on November 13, 2006 under the laws of the British Virgin Islands, and issued

the shareholders of Dongfang Holding an aggregate of 7,450,497 (as adjusted for a four-for-one reverse stock split effected in

November 2009) shares of our common stock, which shares were distributed pro-rata to the shareholders of Dongfang Holding in accordance

with their respective ownership interests in Dongfang Holding.

At the time of the Merger Agreement, Dongfang Holding owned all

of the issued and outstanding stock and ownership of Dongfang Paper and such shares of Dongfang Paper were held in trust with Zhenyong

Liu, Xiaodong Liu and Shuangxi Zhao, for Mr.

Zhao (the original shareholders of Dongfang Paper) to exercise

control over the disposition of Dongfang Holding’s shares in Dongfang Paper on Dongfang Holding’s behalf until Dongfang

Holding successfully completed the change in registration of Dongfang Paper’s capital with the relevant PRC Administration

of Industry and Commerce as the 100% owner of Dongfang Paper’s shares.

As a result of the merger transaction, Dongfang Holding

became a wholly owned subsidiary of the Company, and Dongfang Holding’s wholly owned subsidiary, Dongfang Paper, became an

indirectly owned subsidiary of the Company.

Dongfang Holding,

as the 100% owner of Dongfang Paper, was unable to complete the registration of Dongfang Paper’s capital under its name within

the proper time limits set forth under PRC law.

In connection with the name change,

our common stock began being traded under a new NYSE symbol, “ITP,” at such time.

October 29, 2007, pursuant to an agreement and plan of merger (the “Merger Agreement”), the Company acquired Dongfang

Zhiye Holding Limited (“Dongfang Holding”), a corporation formed on November 13, 2006 under the laws of the British

Virgin Islands, and issued the shareholders of Dongfang Holding an aggregate of 7,450,497 (as adjusted for a four-for-one reverse

stock split effected in November 2009) shares of our common stock, which shares were distributed pro-rata to the shareholders of

Dongfang Holding in accordance with their respective ownership interests in Dongfang Holding.

At the time of the Merger Agreement,

Dongfang Holding owned all of the issued and outstanding stock and ownership of Dongfang Paper and such shares of Dongfang Paper

were held in trust with Zhenyong Liu, Xiaodong Liu and Shuangxi Zhao, for Mr.

Zhao (the original shareholders

of Dongfang Paper) to exercise control over the disposition of Dongfang Holding’s shares in Dongfang Paper on Dongfang

Holding’s behalf until Dongfang Holding successfully completed the change in registration of Dongfang Paper’s capital

with the relevant PRC Administration of Industry and Commerce as the 100% owner of Dongfang Paper’s shares.

As a result of the

merger transaction, Dongfang Holding became a wholly owned subsidiary of the Company, and Dongfang Holding’s wholly owned

subsidiary, Dongfang Paper, became an indirectly owned subsidiary of the Company.

Holding, as the 100% owner of Dongfang Paper, was unable to complete the registration of Dongfang Paper’s capital under its name

within the proper time limits set forth under PRC law.

In connection with the consummation of the restructuring transactions described

1 unchanged sentence

Dongfang Paper shareholders entered into certain agreements with Baoding Shengde Paper Co., Ltd.

(“Baoding Shengde”)

to transfer the control of Dongfang Paper over to Baoding Shengde.

24, 2009, the Company consummated a number of restructuring transactions pursuant to which it acquired all of the issued and outstanding

(“Baoding Shengde”) to transfer

the control of Dongfang Paper over to Baoding Shengde.

June 24, 2009, the Company consummated a number of restructuring transactions pursuant to which it acquired all of the issued and outstanding

shares of Shengde Holdings Inc., a Nevada corporation.

1 unchanged sentence

was incorporated in the State of Nevada on February 25,

25, 2009, and holds a wholly-owned subsidiary, Baoding Shengde, a limited liability company organized under the laws of the PRC

on June 1, 2009.

Because Baoding Shengde is a wholly-owned subsidiary of Shengde Holdings Inc., it is regarded as a wholly foreign-owned

entity under PRC law.

Effective June 24,

2009, Baoding Shengde, Dongfang Paper and the original shareholders of Dongfang Paper entered into a number of contractual arrangements,

as subsequently amended on February 10, 2010, pursuant to which Baoding Shengde acts as the management company for Dongfang Paper,

and Dongfang Paper conducts the principal operations of the business.

The contractual arrangements, as amended, effectively transferred

the preponderance of the economic benefits of Dongfang Paper to Baoding Shengde, and Baoding Shengde assumed effective control

and management over Dongfang Paper.

The contractual arrangements, as amended, include the following:

(i) Exclusive Technical Service and Business Consulting

The exclusive

technical service and business consulting agreement, entered into by and between Baoding Shengde and Dongfang Paper, provides that

Baoding Shengde shall provide exclusive technical, business and management consulting services to Dongfang Paper, in exchange for

service fees including a fee equivalent to 80% of Dongfang Paper’s total annual net profits.

The agreement is terminable

upon mutual written agreement.

(ii) Call Option Agreement

The call option agreement,

entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that the shareholders

of Dongfang Paper irrevocably grant to Baoding Shengde an option to purchase all or part of each shareholder’s equity interest

in Dongfang Paper.

The exercise price for the options shall be RMB yuan for each of the shareholders’

equity interests, or

if at any time there are PRC laws regulating the minimum exercise price of such options, then to the extent permitted under PRC

The call option agreement contains covenants from Dongfang Paper and its shareholders that they will refrain from taking certain

actions without Baoding Shengde’s consent that would materially affect Dongfang Paper’s operations and asset value,

including (i) supplementing or amending its articles of association or bylaws, (ii) changing Dongfang Paper’s registered

capital or shareholding structure, (iii) selling, transferring, mortgaging or disposing of any interests in Dongfang Paper’s

assets or income, or encumbering Dongfang Paper’s assets or income in a way that would approve a security interest on such

assets, (iv) incurring or guaranteeing any debts not incurred in its normal business operations, (v) entering into any material

contract or urging Dongfang Paper management to dispose of any Dongfang Paper assets, unless it is within the company’s normal

business operations;

(vi) providing any loan or guarantee to any third party;

(vii) appointing or removing any management personnel

or directors that can be changed upon Dongfang Paper shareholder approval;

(viii) declaring or distributing any dividends to the

stockholders.

The agreement remains effective until Baoding Shengde or its designees have acquired 100% of the equity interests

of Dongfang Paper underlying the options.

(iii) Share Pledge Agreement

The share pledge agreement

entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that the Dongfang

Paper shareholders will pledge all of their equity interests in Dongfang Paper to Baoding Shengde as security for their obligations

under the other management agreements described in this section.

Specifically, Baoding Shengde is entitled to dispose of the pledged

equity interests in the event that the Dongfang Paper shareholders or Dongfang Paper fails to pay the service fees to Baoding Shengde

pursuant to the exclusive technical service and business consulting agreement or fails to perform their other obligations under

2009, and holds a wholly-owned subsidiary, Baoding Shengde, a limited liability company organized under the laws of the PRC on June 1,

Because Baoding Shengde is a wholly-owned subsidiary of Shengde Holdings Inc., it is regarded as a wholly foreign-owned entity

under PRC law.

June 24, 2009, Baoding Shengde, Dongfang Paper and the original shareholders of Dongfang Paper entered into a number of contractual arrangements,

as subsequently amended on February 10, 2010, pursuant to which Baoding Shengde acts as the management company for Dongfang Paper, and

Dongfang Paper conducts the principal operations of the business.

The contractual arrangements, as amended, effectively transferred the

preponderance of the economic benefits of Dongfang Paper to Baoding Shengde, and as a result, Baoding Shengde assumed effective control

and management over, is considered the primary beneficiary of Dongfang Paper for accounting purposes and we consolidate Dongfang Paper’s

operating results in IT Tech Packaging’s financial statements under U.S.

The contractual arrangements, as amended, include

the following:

(i) Exclusive

Technical Service and Business Consulting Agreement

exclusive technical service and business consulting agreement, entered into by and between Baoding Shengde and Dongfang Paper, provides

that Baoding Shengde shall provide exclusive technical, business and management consulting services to Dongfang Paper, in exchange for

service fees including a fee equivalent to 80% of Dongfang Paper’s total annual net profits.

The agreement is terminable upon mutual

written agreement.

Call Option Agreement

call option agreement, entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that

the shareholders of Dongfang Paper irrevocably grant to Baoding Shengde an option to purchase all or part of each shareholder’s

equity interest in Dongfang Paper.

The exercise price for the options shall be RMB yuan for each of the shareholders’ equity interests,

or if at any time there are PRC laws regulating the minimum exercise price of such options, then to the extent permitted under PRC Law.

The call option agreement contains covenants from Dongfang Paper and its shareholders that they will refrain from taking certain actions

without Baoding Shengde’s consent that would materially affect Dongfang Paper’s operations and asset value, including (i)

supplementing or amending its articles of association or bylaws, (ii) changing Dongfang Paper’s registered capital or shareholding

structure, (iii) selling, transferring, mortgaging or disposing of any interests in Dongfang Paper’s assets or income, or encumbering

Dongfang Paper’s assets or income in a way that would approve a security interest on such assets, (iv) incurring or guaranteeing

any debts not incurred in its normal business operations, (v) entering into any material contract or urging Dongfang Paper management

to dispose of any Dongfang Paper assets, unless it is within the company’s normal business operations;

(vi) providing any loan

or guarantee to any third party;

(vii) appointing or removing any management personnel or directors that can be changed upon Dongfang

Paper shareholder approval;

(viii) declaring or distributing any dividends to the stockholders.

The agreement remains effective until

Baoding Shengde or its designees have acquired 100% of the equity interests of Dongfang Paper underlying the options.

Pledge Agreement

share pledge agreement entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that

the Dongfang Paper shareholders will pledge all of their equity interests in Dongfang Paper to Baoding Shengde as security for their

obligations under the other management agreements described in this section.

Specifically, Baoding Shengde is entitled to dispose of

the pledged equity interests in the event that the Dongfang Paper shareholders or Dongfang Paper fails to pay the service fees to Baoding

Shengde pursuant to the exclusive technical service and business consulting agreement or fails to perform their other obligations under

the other management agreement.

The agreement contains covenants from Dongfang Paper’s shareholders that they will refrain

from taking certain actions without Baoding Shengde’s prior written consent, such as transferring or assigning their equity

interests, or creating or permitting the creation of any pledges which may have an adverse effect on the rights or benefits of

Baoding Shengde under the agreement.

The Dongfang Paper shareholders also promise to comply with the laws and regulations relevant

to the pledges under the agreement and to facilitate in good faith the protection of the ability of Baoding Shengde to exercise

its rights under the agreement.

The terms of the share pledge agreement remains in effect until all the obligations under the other

management agreements have been fulfilled, whether or not the terms of the other management agreements have expired.

(iv) Proxy Agreement

The proxy agreement,

entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that the Dongfang

Paper shareholders shall irrevocably entrust a designee of Baoding Shengde with such shareholder’s voting rights and the

right to represent such shareholder to exercise his or her rights at any shareholder’s meeting of Dongfang Paper or with

respect to any shareholder action to be taken in accordance with the laws and Dongfang Paper’s Articles of Association.

terms of the agreement are binding on the parties for as long as the Dongfang Paper shareholders continue to hold any equity interest

in Dongfang Paper.

An Dongfang Paper shareholder will cease to be a party to the agreement once it transfers its equity interests

with the prior approval of Baoding Shengde.

On June 24, 2009,

Zhao Tianqing, the sole shareholder of Shengde Holdings Inc., assigned to the Company, for good and valuable consideration, 100

The agreement contains covenants from Dongfang Paper’s shareholders that they will refrain from

taking certain actions without Baoding Shengde’s prior written consent, such as transferring or assigning their equity interests,

or creating or permitting the creation of any pledges which may have an adverse effect on the rights or benefits of Baoding Shengde under

the agreement.

The Dongfang Paper shareholders also promise to comply with the laws and regulations relevant to the pledges under the

agreement and to facilitate in good faith the protection of the ability of Baoding Shengde to exercise its rights under the agreement.

The terms of the share pledge agreement remains in effect until all the obligations under the other management agreements have been fulfilled,

whether or not the terms of the other management agreements have expired.

Proxy Agreement

proxy agreement, entered into by and between Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper, provides that the

Dongfang Paper shareholders shall irrevocably entrust a designee of Baoding Shengde with such shareholder’s voting rights and the

right to represent such shareholder to exercise his or her rights at any shareholder’s meeting of Dongfang Paper or with respect

to any shareholder action to be taken in accordance with the laws and Dongfang Paper’s Articles of Association.

The terms of the

agreement are binding on the parties for as long as the Dongfang Paper shareholders continue to hold any equity interest in Dongfang

AnDongfang Paper shareholder will cease to be a party to the agreement once it transfers its equity interests with the prior approval

of Baoding Shengde.

June 24, 2009, Zhao Tianqing, the sole shareholder of Shengde Holdings Inc., assigned to the Company, for good and valuable consideration,

100 shares representing 100% of the issued and outstanding shares of Shengde Holdings Inc.

As a result of this assignment and the restructuring

transactions described above, Shengde Holdings Inc., Baoding Shengde, and Dongfang Paper became directly and indirectly controlled

by the Company, and Dongfang Paper continued to function as the Company’s operating entity.

In addition to controlling

the operations and beneficial ownership of Dongfang Paper, Baoding Shengde also acquired a digital photo paper production line

(including two photo paper coating lines and ancillary equipment) in an asset acquisition transaction on November 25, 2009 and

began directly conducting business in the PRC.

We suspended production of photo paper in June 2016 and now are upgrading the production

line to produce more competitive photo paper products.

We expect to resume our digital photo paper production in the near future.

An agreement was entered

into among Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper on December 31, 2010, reiterating that Baoding

Shengde is entitled to the distributable profit of Dongfang Paper, pursuant to the above mentioned Exclusive Technical Service

transactions described above, Shengde Holdings Inc., Baoding Shengde, and Dongfang Paper became directly and indirectly controlled by

the Company, and Dongfang Paper continued to function as the Company’s operating entity.

addition to controlling the operations and beneficial ownership of Dongfang Paper, Baoding Shengde also acquired a digital photo paper

production line (including two photo paper coating lines and ancillary equipment) in an asset acquisition transaction on November 25,

2009 and began directly conducting business in the PRC.

We suspended production of photo paper in June 2016 and now are upgrading the

production line to produce more competitive photo paper products.

agreement was entered into among Baoding Shengde, Dongfang Paper and the shareholders of Dongfang Paper on December 31, 2010, reiterating

that Baoding Shengde is entitled to the distributable profit of Dongfang Paper, pursuant to the above mentioned Exclusive Technical Service

and Business Consulting Agreement.

In addition, Dongfang Paper and the shareholders of Dongfang Paper agreed that they would not

declare any of Dongfang Paper’s unappropriated earnings, including any earnings of Dongfang Paper from its establishment

to 2010 and thereafter, as dividend.

The following diagram sets forth the current corporate

structure of IT Tech Packaging:

100% ownership

Controlled by contractual arrangements

Recent Developments

March 2021 Public

1, 2021, the Company offered and sold to the public investors an aggregate of 29,277,866 shares of common stock and

14,638,933 warrants to purchase up to 14,638,933 shares of common stock in a firm commitment underwritten public offering

for gross proceeds of approximately $21.9 million.

The purchase price for each share of common stock and accompanying warrant

sold in the offering was $0.75.

The warrants are exercisable commencing on March 1, 2021 at an exercise price of $0.75 and

will expire on March 1, 2026.

In the event of a stock split, stock dividend, combination, subsequent right offering or

reclassification of the outstanding shares of Common Stock, the exercise price and the number of shares issuable upon

exercise of the warrants shall be proportionately adjusted.

The Company intends to use the net proceeds from the offering for

general corporate and working capital purposes.

January 2021 Public

On January 20, 2021,

the Company offered and sold to certain institutional investors an aggregate of 26,181,818 shares of common stock and 26,181,818

In addition, Dongfang Paper and the shareholders of Dongfang Paper agreed that they would not declare

any of Dongfang Paper’s unappropriated earnings, including any earnings of Dongfang Paper from its establishment to 2010 and thereafter,

contractual agreements described above have not been tested in a court of law.

following diagram sets forth the current corporate structure of IT Tech Packaging:

by contractual arrangements

Regulatory Developments

On January 4, 2022, the Cyberspace

Administration of China, or CAC, issued the revised Measures on Cyberspace Security Review (the “Revised Measures”), which

has came into effect on February 15, 2022.

Under the Revised Measures, any “network platform operator” controlling personal

information of no less than one million users which seeks to list in a foreign stock exchange should also be subject to cyber security

We do not believe we are “network

platform operator” who control over one million personal information as mentioned above;

as such, we believe we are currently not

be subject to the cyber security review by the CAC.

However, the definition of “network platform operator” is unclear

and it is also unclear on how it will be interpreted and implemented by the relevant PRC governmental authorities.

factors — Risk Factors Relating to Doing Business in China — Our business may be subject to a variety

of PRC laws and other obligations regarding cyber security and data protection .”

On July 6, 2021, the

relevant PRC governmental authorities made public the Opinions on Strictly Cracking Down Illegal Securities Activities in Accordance with

These opinions emphasized the need to strengthen the administration over illegal securities activities and the supervision on

overseas listings by China-based companies and proposed to take effective measures, such as promoting the construction of relevant regulatory

systems to deal with the risks and incidents faced by China-based overseas-listed companies.

As these opinions are recently issued, official

guidance and related implementation rules have not been issued yet and the interpretation of these opinions remains unclear at this stage.

See “Risk Factors — Risk Factors Relating to Doing Business in China — While the approval and/or

other requirements of the CSRC or other PRC governmental authorities are currently not required, they may be required, in connection with

our oversea listing under PRC rules, regulations or policies, and, if required, we cannot predict whether or how soon we will be able

to obtain such approval .” As of the date of this annual report, we have not received any inquiry, notice, warning, or sanctions

regarding listing abroad or offshore offering from the CSRC or any other PRC governmental authorities.

believe that we are currently not required to obtain any permission or approval from the China Securities Regulatory Commission (“CSRC”)

and Cyberspace Administration of China (“CAC”) in the PRC to issue securities to foreign investors.

However, there is no

guarantee that this will continue to be the case in the future in relation to any future offerings of our company or the continued listing

of our company’s securities on the NYSE American, or even in the event such permission or approval is required and obtained, it

will not be subsequently revoked or rescinded.

If we do not receive or maintain the approvals, or we inadvertently conclude that such

approvals are not required, or applicable laws, regulations, or interpretations change such that we are required to obtain approval in

the future, we may be subject to an investigation by competent regulators, fines or penalties, or an order prohibiting us from conducting

an offering, and these risks could result in a material adverse change in our operations and the value of our securities, significantly

limit or completely hinder our ability to offer or continue to offer securities to investors, or cause such securities to significantly

decline in value or become worthless.

December 24, 2021, CSRC issued Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic

Companies (Draft for Comments) (the “Administration Provisions”), and the Administrative Measures for the Filing of Overseas

Securities Offering and Listing by Domestic Companies (the “Measures”), which are open for public comments by January 23,

The Administration Provisions and Measures for overseas listings lay out specific requirements for filing documents and include

unified regulation management, strengthening regulatory coordination, and cross-border regulatory cooperation.

Domestic companies seeking

to list abroad must carry out relevant security screening procedures if their businesses involve supervisions such as foreign investment

security and cyber security reviews.

Companies endangering national security are among those off-limits for overseas listings.

to Relevant Officials of the CSRC Answered Reporter Questions (“CSRC Answers”), after the Administration Provisions and Measures

are implemented upon completion of public consultation and due legislative procedures, the CSRC will formulate and issue guidance for

filing procedures to further specify the details of filing administration and ensure that market entities could refer to clear guidelines

for filing, which means it will still take time to put the Administration Provisions and Measures into effect.

As the Administration

Provisions and Measures have not yet come into effect, we are currently unaffected by them.

However, according to CSRC Answers, only

new initial public offerings and refinancing by existing overseas listed Chinese companies will be required to go through the filing

other existing overseas listed companies will be allowed a sufficient transition period to complete their filing procedure.

However, it is uncertain when the Administration Provision and the Measures will take effect or if they will take effect as currently

On December 24, 2021, the

Standing Committee of the National People’s Congress issued Law of the People’s Republic of China on the Prevention and Control

of Noise Pollution(the “Prevention and Control of Noise Pollution”), which will be effected on June 5, 2022.

the Prevention and Control of Noise Pollution, entities subject to pollutant discharge licensing management shall not emit industrial

noise without a pollutant discharge permit and shall prevent and control noise pollution according to the requirements of the pollutant

discharge permit.

Consolidation

We conduct substantially all

of our business in China through Dongfang Paper, the VIE, due to PRC legal restrictions of foreign ownership in certain sectors.

Substantially

all of IT Tech Packaging’s revenues, costs and net income in China are directly or indirectly generated through the VIE.

Packaging, through its PRC Subsidiary, Baoding Shengde, has signed various agreements with the VIE and shareholders of the VIE to allow

the transfer of economic benefits from the VIE to the PRC Subsidiary and to direct the activities of the VIE.

Total assets and liabilities

presented on IT Tech Packaging’s consolidated balance sheets and revenue, expense, net income presented on consolidated statement

of operations and comprehensive income as well as the cash flow from operating, investing and financing activities presented on the consolidated

statement of cash flows are substantially the financial position, operation and cash flow of the VIE.

The Company has not provided any

financial support to the VIE for the fiscal years ended at December 31, 2020 and 2019.

As of December 31, 2021, our variable interest

entity accounted for an aggregate of 84.13% and 69.51%of our total assets and total liabilities.

As of December 31, 2020, our variable

interest entity accounted for an aggregate of 90.7% and 72.4%of our total assets and total liabilities.

As of December 31, 2021 and 2020,

$1,921,407 and $3,315,778 of cash and cash equivalents were denominated in RMB, respectively.

Tech Packaging and its directly owned subsidiary, Shengde Holding do not have any substantial assets or liabilities or result of operations.

The following table sets forth the assets, liabilities, results of operations and changes in cash, cash equivalents of the VIE, which

were included in the Company’s consolidated balance sheets and statements of comprehensive income and statements of cash flows

with intercompany transactions eliminated:

Current assets

Total non-current assets

$ 169,766,341

$ 167,190,706

$ 203,211,040

$ 181,262,737

Total liabilities

the Fiscal Year Ended

Net cash provided

by operating activities

Net cash used in investing

$ (25,071,372 )

$ (18,937,689 )

Net cash used in financing

Transfers and Dividend Distribution

IT Tech Packaging

conducts its business operations in China through its Baoding Shengde, or the PRC Subsidiary and Dongfang Paper, the VIE.

IT Tech Packaging can transfer cash to the PRC Subsidiary through loans and/or capital contributions, and the PRC Subsidiary can

transfer cash to IT Tech Packaging through issuing dividends or other distributions.

The PRC Subsidiary can transfer cash to the VIE

through intercompany loans and capital contributions, and the VIE can transfer cash to the PRC Subsidiary as services fees under the

VIE contractual arrangements.

For the year ended December 31, 2021, the cash flows occurred between IT Tech Packaging, its

subsidiaries and the VIE included i) funding through Shengde Holdings Inc.

to Baoding Shengde, with an amount of $32,052,000 as

capital contributions ii) Baoding Shengde payments to Heibei Tengsheng of $2,027,701 for purchase of products iii) Baoding Shengde loans to Dongfang Paper with

total amount of $19,345,101 and iv) Dongfang Paper payments to Baoding Shengde of $5,016,446 for purchase of raw materials.

Current PRC regulations permit

the PRC Subsidiary to pay dividends to its shareholders only out of their accumulated profits, if any, determined in accordance with PRC

accounting standards and regulations.

The PRC Subsidiary is required to set aside 10% of its after-tax profits to fund a statutory reserve

until such reserve reaches 50% of its registered capital if it distributes its after-tax profits for the current financial year.

see “ Risk Factors — Risk Factors Relating to Doing Business in China — We may rely on dividends

and other distributions on equity paid by our PRC subsidiary to fund any cash and financing requirements we may have, and any limitation

on the ability of our PRC Subsidiary to make payments to us could have a material and adverse effect on our ability to conduct our business.

In addition, cash transfers from IT Tech Packaging are subject to applicable PRC laws and regulations on loans and direct investment.

For details, see “ Risk Factors — Risk Factors Relating to Doing Business in China — PRC regulation

of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay

us from making loans or additional capital contributions to our PRC Subsidiary, which could materially and adversely affect our liquidity

and our ability to fund and expand our business .”

In addition, the PRC government

imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of

IT Tech Packaging receives a significant portion of its revenues in Renminbi.

Under IT Tech Packaging’s current corporate

structure, IT Tech Packaging’s Nevada holding company may rely on dividend payments from the PRC Subsidiary to fund any cash and

financing requirements it may have.

Under existing PRC foreign exchange regulations, payments of current account items, including profit

distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without

prior approval of State Administration of Foreign Exchange, or SAFE, by complying with certain procedural requirements.

However, approval

from or registration with appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted

out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies.

As a result, we need to obtain

SAFE approval to use cash generated from the operations of the PRC Subsidiary and VIE to pay off their respective debt in a currency other

than Renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency other than Renminbi.

If the foreign exchange control system prevents us from obtaining sufficient foreign currencies to satisfy our foreign currency demands,

we may not be able to pay dividends in foreign currencies to its shareholders.

See “ Risk Factors — Risk Factors

Relating to Doing Business in China — Governmental control of currency conversion may limit our ability to utilize our

revenues effectively and affect the value of your investment ”.

In order to secure the amounts owed under the VIE agreements,

the VIE and its shareholders entered into a share pledge agreement with the PRC Subsidiary, pursuant to which if the VIE fails to pay

the service fees to the PRC Subsidiary pursuant to the exclusive technical service and business consulting agreement or fails to perform

their other obligations under the other management agreement, the PRC Subsidiary is entitled to dispose of the pledged equity interests

IT Tech Packaging declared

and paid four quarterly cash dividends to its U.S.

investors in April 2012 and November 2013.

As of the date of this annual report, other

than those cash dividends, none of IT Tech Packaging’s subsidiaries have ever issued any dividends or made other distributions to

IT Tech Packaging or their respective holding companies nor has IT Tech Packaging or any of IT Tech Packaging’s subsidiaries ever

paid dividends or made other distributions to U.S.

IT Tech Packaging currently intend to retain all future earnings to finance

its operations and to expand its business.

As a result, IT Tech Packaging does not expect to pay any cash dividends in the foreseeable

Foreign Company Accountable Act

in our securities may be prohibited under the Holding Foreign Companies Accountable Act, or the HFCAA, if the Public Company Accounting

Oversight Board (United States) (the “PCAOB”) determines that it cannot inspect or investigate completely our auditor.

to the HFCAA, the PCAOB issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to inspect or investigate

completely registered public accounting firms headquartered in:

(1) mainland China of the People’s Republic of China because of

a position taken by one or more authorities in mainland China;

and (2) Hong Kong, a Special Administrative Region and dependency of the

PRC, because of a position taken by one or more authorities in Hong Kong.

In addition, the PCAOB’s report identified the specific

registered public accounting firms which are subject to these determinations.

PCAOB is currently unable to conduct inspections in China without the approval of Chinese government authorities.

If it is later determined

that the PCAOB is unable to inspect or investigate our auditor completely, investors may be deprived of the benefits of such inspection.

Any audit reports not issued by auditors that are completely inspected by the PCAOB, or a lack of PCAOB inspections of audit work undertaken

in China that prevents the PCAOB from regularly evaluating our auditors’ audits and their quality control procedures, could result

in a lack of assurance that our financial statements and disclosures are adequate and accurate.

auditor, WWC, P.C., Certified Public Accountants, is an independent registered public accounting firm with the PCAOB, and as an auditor

of publicly traded companies in the U.S., is subject to laws in the U.S.

pursuant to which the PCAOB conducts regular inspections to assess

its compliance with the applicable professional standards.

WWC, P.C., Certified Public Accountants, is based in the United States and

has been inspected by the PCAOB on a regular basis, with the last inspection in November 2021.

WWC, P.C., Certified Public Accountants,

is not headquartered in mainland China or Hong Kong and was not identified as a firm subject to the determinations announced by the PCAOB

on December 16, 2021.

Should the PCAOB be unable to fully conduct inspection of our auditor’s work papers in China, it will make

it difficult to evaluate the effectiveness of our auditor’s audit procedures or equity control procedures.

Investors may consequently

lose confidence in our reported financial information and procedures or quality of the financial statements, which would adversely affect

us and our securities.

if trading in our securities is prohibited under the HFCAA in the future because the PCAOB determines that it cannot inspect or fully

investigate our auditor at such future time, an exchange may determine to delist our securities.

“ Risk Factors—Risks Associated with Our Company— A recent joint statement by the SEC and the Public Company Accounting

Oversight Board (United States), or the “PCAOB,” proposed rule changes submitted by Nasdaq, and the newly enacted “Holding

Foreign Companies Accountable Act” all call for additional and more stringent criteria to be applied to emerging market companies

upon assessing the qualification of their auditors, especially the non-U.S.

auditors who are not inspected by the PCAOB.

These developments

could add uncertainties to investing in our securities .”

Business Developments

2021 Public Offering

March 1, 2021, the Company offered and sold to the public investors an aggregate of 29,277,866 shares of common stock and 14,638,933

warrants to purchase up to 14,638,933 shares of common stock in a firm commitment underwritten public offering for gross proceeds of

approximately $21.9 million.

The purchase price for each share of common stock and accompanying warrant sold in the offering was $0.75.

The warrants are exercisable commencing on March 1, 2021 at an exercise price of $0.75 and will expire on March 1, 2026.

of a stock split, stock dividend, combination, subsequent right offering or reclassification of the outstanding shares of Common Stock,

the exercise price and the number of shares issuable upon exercise of the warrants shall be proportionately adjusted.

The Company intends

to use the net proceeds from the offering for general corporate and working capital purposes.

2021 Public Offering

January 20, 2021, the Company offered and sold to certain institutional investors an aggregate of 26,181,818 shares of common stock and

26,181,818 warrants to purchase up to 26,181,818 shares of common stock in a best-efforts public offering for gross proceeds of approximately

1 unchanged sentence

The purchase price for each share of common stock and the corresponding warrant sold in the offering was $0.55.

The warrants are exercisable commencing on January 20, 2021 at an exercise price of $0.55 and will expire on January 20, 2026.

In the event of a stock split, stock dividend, combination, subsequent right offering or reclassification of the outstanding shares

of Common Stock, the exercise price and the number of shares issuable upon exercise of the warrants shall be proportionately adjusted.

The Company intends to use the net proceeds from the offering for general corporate and working capital purposes.

Cogenerating Project

In November 2020,

we completed inviting bids for the 75 tonne per hour biomass boiler procurement for our biomass cogeneration project.

well-known enterprises in the biomass industry participated in tendering opening bids.

are exercisable commencing on January 20, 2021 at an exercise price of $0.55 and will expire on January 20, 2026.

In the event of a stock

split, stock dividend, combination, subsequent right offering or reclassification of the outstanding shares of Common Stock, the exercise

price and the number of shares issuable upon exercise of the warrants shall be proportionately adjusted.

The Company intends to use the

net proceeds from the offering for general corporate and working capital purposes.

November 2020, we completed inviting bids for the 75 tonne per hour biomass boiler procurement for our biomass cogeneration project.

Multiple well-known enterprises in the biomass industry participated in tendering opening bids.

In February 2021, we completed evaluation

on the bidding proposals and announced that Tai Shan Group Co., Ltd., a top manufacturer in the biomass industry in China, has

on the bidding proposals and announced that Tai Shan Group Co., Ltd., a top manufacturer in the biomass industry in China, has won the

Installation of the boilers is expected to commence in the near future.

We expect to participate in the bidding process

for urban central heating projects.

Summary of Risk Factors

Investing in our securities

involves significant risks and uncertainties.

You should carefully consider all of the information in this prospectus before making

an investment in our securities.

We expect to participate in the bidding process for urban

central heating projects.

Paper Production Line

In July 2021, The Company

announced that the Company’s tissue paper research and development center has received a Level B scale-above Certification as an

industrial R&D enterprise institution in Hebei province after on-site inspection by regulators.

The Company has also been

granted twelve new utility patent certificates on paper manufacturing related equipment issued by the State Intellectual Property Office,

including equipment testing, screening and filtering, and mixing.

of Risk Factors

in our securities involves significant risks and uncertainties.

You should carefully consider all of the information in this prospectus

before making an investment in our securities.

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

These risks are discussed more fully in the section titled “Risk Factors.”

Risks Related to Our Business

Risks and uncertainties

related to our business include, but are not limited to, the following:

● Our business, financial condition and results of operations

may be materially adversely affected by global health epidemics, including the recent COVID-19 outbreak;

● In order to comply with PRC regulatory requirements,

we operate our businesses through companies with which we have contractual relationships but in which we do not have controlling

● Because we rely on the consulting services agreement

with Dongfang Paper for essentially all of our revenue and cash flows, any difficulty for Dongfang Paper to pay consulting fees

to Baoding Shengde under the consulting agreement may have a material adverse effect on our operations.;

● If the PRC government determines that our agreements

with these companies are not in compliance with applicable regulations, our business in the PRC could be materially adversely

● Our arrangements with Dongfang Paper and its shareholders

may be subject to a transfer pricing adjustment by the PRC tax authorities which could have an adverse effect on our income and

● The exercise of our option to purchase part or all

of the equity interests in Dongfang Paper under the Call Option Agreement might be subject to approval by the PRC government.

Our failure to obtain this approval may impair our ability to substantially control Dongfang Paper and could result in actions

by Dongfang Paper that conflict with our interests;

● We are dependent on certain key personnel and loss

of these key personnel could have a material adverse effect on our business, financial condition and results of operations;

● Our certificates, permits, and licenses related to our paper making operations are subject to

governmental control and renewal and failure to obtain renewal will cause all or part of our operations to be

● Compliance with environmental regulations is expensive,

and noncompliance may result in adverse publicity and potentially significant monetary damages and fines or suspension of our

business operations.

● Our failure to protect our intellectual property rights

may undermine our competitive position, and external infringements of our intellectual property rights may adversely affect our

● We may be subject to intellectual property infringement

claims or other allegations, which may materially and adversely affect our business, financial condition and prospects;

● We may have to bear unanticipated tax liabilities which

may cause serious adverse effects to our financial conditions and business operations.

Risks Related to Doing Business in the PRC

We face risks and uncertainties

related to doing business in China in general, including, but not limited to, the following:

● Changes in the policies of the PRC government could

have a significant impact upon the business we may be able to conduct in the PRC and the profitability of such business;

● The PRC laws and regulations governing our current

business operations are sometimes vague and uncertain.

These risks are discussed more fully in the section titled “Risk Factors.”

Relating to our Business

business, financial condition and results of operations may be materially adversely affected

by global health epidemics, including the COVID-19 outbreak.

operating history may not serve as an adequate basis to judge our future prospects and results

of operations.

Paper and Baoding Shengde’s failure to compete effectively may adversely affect our

ability to generate revenue.

may not be able to effectively control and manage our growth.

through our subsidiaries, may engage in future acquisitions that could dilute the ownership

interests of our stockholders and cause us to incur debt and assume contingent liabilities.

are responsible for the indemnification of our officers and directors.

are dependent on certain key personnel and loss of these key personnel could have a material

adverse effect on our business, financial condition and results of operations.

may not be able to hire and retain qualified personnel to support our growth and if we are

unable to retain or hire these personnel in the future, our ability to improve our products

and implement our business objectives could be adversely affected.

operating results may fluctuate as a result of factors beyond our control.

face risks related to product liability claims.

operating results also depend on the availability and pricing of energy and raw materials.

material disruption at one of our manufacturing facilities could prevent us from meeting

customer demand, reduce our sales, and/or negatively affect our net income.

certificates, permits, and licenses related to our papermaking operations are subject to

governmental control and renewal and failure to obtain renewal will cause all or part of

our operations to be terminated.

with environmental regulations is expensive, and noncompliance may result in adverse publicity

and potentially significant monetary damages and fines or suspension of our business operations.

we are unable to respond to pricing pressures, our business may be harmed.

we fail to introduce enhancements to our existing products or to develop new products, our

business and results of operations could be adversely affected.

have limited insurance coverage and may incur losses resulting from product liability claims

or business interruptions.

failure to protect our intellectual property rights may undermine our competitive position,

and external infringements of our intellectual property rights may adversely affect our business.

may be subject to intellectual property infringement claims or other allegations, which may

materially and adversely affect our business, financial condition and prospects.

Related To Doing Business in the PRC

PRC government has significant oversight and discretion over the conduct of a PRC company’s

business operations or to exert control over any offering of securities conducted overseas

and/or foreign investment in China-based issuers, and may intervene with or influence our

operations, may limit or completely hinder our ability to offer or continue to offer securities

to investors, and may cause the value of such securities to significantly decline or be worthless,

as the government deems appropriate to further regulatory, political and societal goals.

business may be subject to a variety of PRC laws and other obligations regarding cybersecurity

and data protection.

in the policies of the PRC government could have a significant impact upon the business we

may be able to conduct in the PRC and the profitability of such business.

PRC laws and regulations governing our current business operations are sometimes vague and

Any changes in such PRC laws and regulations may harm our business.

● A slowdown, inflation or other adverse developments

in the PRC economy may harm our customers and the demand for our services and products;

● Governmental control of currency conversion may affect

the value of your investment and the fluctuation of the Renminbi may harm your investment;

● Failure to comply with PRC regulations relating to

the establishment of offshore special purpose companies by PRC residents may materially adversely affect us;

● The PRC’s legal and judicial system may not adequately

protect our business and operations and the rights of foreign investors;

● It may be difficult for overseas regulators to conduct

investigation or collect evidence within China;

● The current tensions in international trade and rising

political tensions, particularly between U.S.

and China, may adversely impact our business, financial condition, and results of

Risks Related to Our Corporate Structure

We are also subject

to risks and uncertainties related to our corporate structure, including, but not limited to, the following:

● Our current corporate structure and business operations

may be affected by the newly enacted Foreign Investment Law;

● Any failure by our consolidated VIEs or their shareholders

to perform their obligations under our contractual arrangements with them would have a material adverse effect on our business;

● We may lose the ability to use and enjoy assets held

by our consolidated VIEs that are material to the operation of our business if the entity goes bankrupt or becomes subject to

a dissolution or liquidation proceeding.

General Risks Related to Our Common Stock

In addition to the risks

described above, we are subject to general risks and uncertainties related to our common stock, including, but not limited to,

the following:

● If we fail to comply with Section 404 of the Sarbanes-Oxley Act

of 2002 in a timely manner, our business could be harmed and our stock price could decline;

● Our common stock may be affected by limited trading

volume and may fluctuate significantly;

● If we become directly subject to the scrutiny involving

listed Chinese companies, we may have to expend significant resources to investigate and/or defend the matter, which could

slowdown, inflation or other adverse developments in the PRC economy may harm our customers

and the demand for our services and products.

may rely on dividends and other distributions on equity paid by our PRC subsidiary to fund

any cash and financing requirements we may have, and any limitation on the ability of our

PRC Subsidiary to make payments to us could have a material and adverse effect on our ability

to conduct our business.

● Governmental

control of currency conversion may limit our ability to utilize our revenues effectively

and affect the value of investors’ investment.

regulation of loans to and direct investment in PRC entities by offshore holding companies

and governmental control of currency conversion may delay us from making loans or additional

capital contributions to our PRC Subsidiary, which could materially and adversely affect

our liquidity and our ability to fund and expand our business.

fluctuation of the Renminbi may harm your investment.

to comply with PRC regulations relating to the establishment of offshore special purpose

companies by PRC residents may materially adversely affect us.

the approval and/or other requirements of the CSRC or other PRC governmental authorities

are currently not required, they may be required, in connection with our oversea listing

under PRC rules, regulations or policies, and, if required, we cannot predict whether or

how soon we will be able to obtain such approval.

M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions

of Chinese companies by foreign investors, which could make it more difficult for us to pursue

growth through acquisitions in China.

PRC’s legal and judicial system may not adequately protect our business and operations

and the rights of foreign investors.

our principal assets are located outside of the United States and most of our directors and

officers reside outside of the United States, it may be difficult for you to effect service

of legal process, enforce your rights based on U.S.

federal securities laws against us and

our officers or to enforce U.S.

court judgment against us or them in the PRC.

may be difficult for overseas regulators to conduct investigation or collect evidence within

may be required to broaden the coverage of the mandatory social security insurance programs

under the Labor Law of the PRC.

current tensions in international trade and rising political tensions, particularly between

and China, may adversely impact our business, financial condition, and results of operations.

Related to Our Corporate Structure

current corporate structure and business operations may be affected by the newly enacted

Foreign Investment Law.

failure by our consolidated VIE or their shareholders to perform their obligations under

our contractual arrangements with them would have a material adverse effect on our business.

order to comply with PRC regulatory requirements, we operate our businesses through companies

with which we have contractual relationships but in which we do not have controlling ownership.

we rely on the consulting services agreement with Dongfang Paper for essentially all of our

revenue and cash flows, any difficulty for Dongfang Paper to pay consulting fees to Baoding

Shengde under the consulting agreement may have a material adverse effect on our operations.

the PRC government determines that the contractual agreements constituting part of our VIE

structure do not comply with applicable PRC regulations, or if these regulations change or

are interpreted differently in the future, we may be unable to assert our contractual rights

over the assets of the VIE, and our common stock may decline in value.

contractual arrangements under a VIE Structure may not be as effective as direct ownership

in respect of our relationship with the VIE, and thus, we may incur substantial costs to

enforce the terms of the arrangements, which we may not be able to enforce at all.

shareholders of Dongfang Paper may have actual or potential conflicts of interests with us,

which may adversely affect our business.

may lose the ability to use and enjoy assets held by the VIE that are material to the operation

of our business if the entity goes bankrupt or becomes subject to a dissolution or liquidation

arrangements with Dongfang Paper and its shareholders may be subject to a transfer pricing

adjustment by the PRC tax authorities which could have an adverse effect on our income and

may lose the ability to use, or otherwise benefit from, the licenses, approvals and assets

held by the VIE, which could severely disrupt our business, render us unable to conduct some

of our business operations and constrain our growth.

exercise of our option to purchase part or all of the equity interests in Dongfang Paper

under the Call Option Agreement might be subject to approval by the PRC government.

to obtain this approval may impair our ability to substantially control Dongfang Paper and

could result in actions by Dongfang Paper that conflict with our interests.

Related to Our Common Stock

recent joint statement by the SEC and PCAOB, proposed rule changes submitted by Nasdaq, and

the Holding Foreign Companies Accountable Act all call for additional and more stringent

criteria to be applied to emerging market companies upon assessing the qualification of their

auditors, especially the non-U.S.

auditors who are not inspected by the PCAOB.

These developments

could add uncertainties to investing in our securities.

we fail to comply with Section 404 of the Sarbanes-Oxley Act of 2002 in a timely

manner, our business could be harmed and our stock price could decline.

we become directly subject to the scrutiny involving U.S.

listed Chinese companies, we may

have to expend significant resources to investigate and/or defend the matter, which could

harm our business operations, stock price and reputation.

Impact of COVID-19 on Our Operations

and Financial Performance

Outbreaks of epidemic,

pandemic, or contagious diseases such as COVID-19, could have an adverse effect on our business, financial condition, and results

of operations.

The spread of COVID-19 has resulted in the World Health Organization declaring the outbreak of COVID-19 as

a global pandemic.

officers and directors control us through their positions and stock ownership and their interests

may differ from other stockholders.

may not continue to pay cash dividends and any return on investment may be limited to the

value of our common stock.

common stock may be affected by limited trading volume and may fluctuate significantly.

financings may dilute stockholders or impair our financial condition.

of COVID-19 on Our Operations and Financial Performance

Outbreaks of epidemic, pandemic,

or contagious diseases such as COVID-19, could have an adverse effect on our business, financial condition, and results of operations.

The spread of COVID-19 has resulted in the World Health Organization declaring the outbreak of COVID-19 as a global pandemic.

Substantially all of our revenues and workforce are concentrated in China.

In response to the intensifying efforts

to contain the spread of COVID-19, the Chinese government took a number of actions, which included extending the Chinese New Year

holiday, quarantining individuals suspected of having COVID-19, asking residents in China to stay at home and to avoid public gathering,

among other things.

During the early part of 2020, COVID-19 caused temporary closure of our CMP production, and as a result,

our revenue of CMP decreased by 49.89 % in the first quarter of 2020.

It is, however, still unclear how the pandemic will evolve

going forward, and we cannot assure you whether the COVID-19 pandemic will again bring about significant negative impact on

our business operations, financial condition and operating results, including but not limited to negative impact to our total revenues.

While we have resumed

business operations, there remain significant uncertainties surrounding the COVID-19 outbreak and its further development

as a global pandemic.

Hence, the extent of the business disruption and the related impact on our financial results and outlook

for 2021 cannot be reasonably estimated at this time.

The extent to which the COVID-19 impacts our results will depend on

future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning

the severity of the coronavirus and the actions taken globally to contain the coronavirus or treat its impact, among others.

insurance coverage may not provide protection for all costs that may arise from all such possible events.

We are still assessing

our business operations and the total impact COVID-19 may have on our results and financial condition, but there can be no

assurance that this analysis will enable us to avoid part or all of any impact from the spread of COVID-19 or its consequences,

including downturns in business sentiment generally.

We engage in production

and distribution of three categories of paper products:

corrugating medium paper, offset printing paper, tissue paper products

and non-medical face masks.

Our principal executive offices are located at Science

Park, Juli Road, Xushui District, Baoding City, Hebei Province, People’s Republic of China.

Our telephone number is (86) 312-869-8215.

Our website is located

at http://www.itpackaging.cn.

Manufacturing Process

Corrugating Medium Paper and Offset Printing Paper

Our current products

(excluding tissue paper products) generally undergo two stages of manufacturing:

(1) creating pulp from recycled paper products,

and (2) treating the pulp and molding it into the desired types of paper products.

In response to the intensifying efforts to contain the spread

of COVID-19, the Chinese government took a number of actions, which included extending the Chinese New Year holiday, quarantining individuals

suspected of having COVID-19, asking residents in China to stay at home and to avoid public gathering, among other things.

early part of 2020, COVID-19 caused temporary closure of our CMP production, and as a result, our revenue of CMP decreased by 49.89

% in the first quarter of 2020.

Since we resumed business

operations after the outbreak of COVID-19, the Company kept continuous attention on the development of the COVID-19 pandemic and reacted

actively to its impact on the financial position and operating results of the Company.

As of the date of the annual report, COVID-19’s

adverse impacts on the company’s financial position and operating result as of December 31, 2021 were limited.

We, through our subsidiaries

and VIE, engage in production and distribution of three categories of paper products:

corrugating medium paper, offset printing paper,

tissue paper products and medical face masks in China.

principal executive offices are located at Science Park, Juli Road, Xushui District, Baoding City, Hebei Province, People’s Republic

telephone number is (86) 312-869-8215.

Our website is located at http://www.itpackaging.cn.

Manufacturing

Medium Paper and Offset Printing Paper

current products (excluding tissue paper products) generally undergo two stages of manufacturing:

(1) creating pulp from recycled paper

products, and (2) treating the pulp and molding it into the desired types of paper products.

A brief overview of the pulp and papermaking

process is provided below.

The recycled waste

paper is first sorted by machine, and then broken down and beaten or smashed into small pieces using water and mechanical energy.

recycled waste paper is first sorted by machine, and then broken down and beaten or smashed into small pieces using water and mechanical

It is then put through a course screening drum, followed by a fine screening drum to separate different grades of pulp, a process

that we refer as “concentration”.

In order to purify the pulp further, an approach flow system is used to filter out

any impurities or inconsistencies, such as sand, in the pulp.

sieved to remove the excess water and molded into a specific size.

that we refer as “concentration”.

In order to purify the pulp further, an approach flow system is used to filter out any

impurities or inconsistencies, such as sand, in the pulp.

pulp is sieved to remove the excess water and molded into a specific size.

The moisture content is further reduced by applying hydraulic

1 unchanged sentence

The pulp then enters the drying section where it is rolled over by heated cylinders.

The dried paper is

then coated with a mixture of clay, white pigment and binder to produce a surface on which ink can sit without being fully absorbed,

enabling crisper, more consistent print quality.

The paper goes through

a process called calendaring, which flattens and smoothens the paper into long sheets.

The paper is then wound onto a reel that

is mounted in a roll-slitting machine for rewinding, during which cutters are used to cut the paper into the desired widths.

completion, the rolls are fitted with sleeves and labeled, and then sent to quality control before shipment or storage.

Base Tissue Paper

While we make tissue paper products, we currently purchase

paper pulp from suppliers and use it to manufacture base tissue paper directly.

Corrugating medium paper

Corrugating medium

paper, or CMP is used in the manufacturing of cardboard.

Since the launch of our new Paper Machine (“PM6”) production

The dried paper is then coated

with a mixture of clay, white pigment and binder to produce a surface on which ink can sit without being fully absorbed, enabling crisper,

and more consistent print quality.

paper goes through a process called calendaring, which flattens and smoothens the paper into long sheets.

The paper is then wound onto

a reel that is mounted in a roll-slitting machine for rewinding, during which cutters are used to cut the paper into the desired widths.

Upon completion, the rolls are fitted with sleeves and labeled, and then sent to quality control before shipment or storage.

we make tissue paper products, we currently purchase paper pulp from suppliers and use it to manufacture base tissue paper directly.

medium paper, or CMP is used in the manufacturing of cardboard.

Since the launch of our new Paper Machine (“PM6”) production

line in December 2011, corrugating medium paper has become a major product of the Company.

For the year ended December 31, 2020,

corrugating medium paper comprised approximately 86.61% of our total paper production quantities and roughly 78.42% of our total

Raw materials used in the production of corrugating medium paper include recycled paper board (or Old Corrugating Cardboard

or “OCC,”

as it is commonly referred to in the United States) and certain supplementary agents.

In January 2013, we

suspended the operation of our PM1 production line for renovation, which was then used to produce corrugating medium paper.

May 2014, we launched the commercial production of a renovated PM1 production line.

The renovated PM1 production line produces

light-weight corrugating medium paper with a specification of 40 to 80 grams per square meter (“g/s/m”).

light-weight corrugating medium paper products have a wide range of commercial applications.

For example, they can be used as a

construction material for wall and floor insulation or to manufacture moisture-proof packaging materials for the transportation

of books and magazines by the publishing industry.

It can also be used as corrugating medium to make corrugating cardboard for

packaging that requires light-weight boxes.

The manufacturing process of light-weight corrugating medium paper is similar to that

of the regular corrugating medium paper and also uses recycled paper boards as a major source of raw material.

We now have two

corrugating medium paper production lines, PM6 and PM1.

We refer to products produced from the PM6 production line as Regular CMP

and products produced from the PM1 production line as Light-Weight CMP.

Offset printing paper

is used for offset printing in the publishing industry.

Offset printing paper comprised approximately 8.96% of our total paper

production quantities and approximately 12.15% of our total sales revenue for the year ended December 31, 2020.

For the year ended December 31, 2021, corrugating

medium paper comprised approximately 88.76% of our total paper production quantities and roughly 83.61% of our total revenue.

Raw materials

used in the production of corrugating medium paper include recycled paper board (or Old Corrugating Cardboard or “OCC,” as

it is commonly referred to in the United States) and certain supplementary agents.

In January 2013, we suspended the operation of our

PM1 production line for renovation, which was then used to produce corrugating medium paper.

In May 2014, we launched the commercial

production of a renovated PM1 production line.

The renovated PM1 production line produces light-weight corrugating medium paper with

a specification of 40 to 80 grams per square meter (“g/s/m”).

PM1’s light-weight corrugating medium paper products

have a wide range of commercial applications.

For example, they can be used as a construction material for wall and floor insulation

or to manufacture moisture-proof packaging materials for the transportation of books and magazines by the publishing industry.

also be used as corrugating medium to make corrugating cardboard for packaging that requires light-weight boxes.

The manufacturing process

of light-weight corrugating medium paper is similar to that of the regular corrugating medium paper and also uses recycled paper boards

as a major source of raw material.

We now have two corrugating medium paper production lines, PM6 and PM1.

We refer to products produced

from the PM6 production line as Regular CMP and products produced from the PM1 production line as Light-Weight CMP.

printing paper

printing paper is used for offset printing in the publishing industry.

Offset printing paper comprised approximately 8.21% of our total

paper production quantities and approximately 10.61% of our total sales revenue for the year ended December 31, 2021.

Raw materials used

in making offset printing paper include recycled white scrap paper, fluorescent whitening agent and sizing agent.

have two production lines, PM2 and PM3, for the production of offset printing paper.

Tissue Paper Products

the commercial production of tissue paper products in Wei County Industry Park in June 2015.

We process base tissue paper

purchased from long-term cooperative third party and produce finished tissue paper products, including toilet paper, boxed

and soft-packed tissues, handkerchief tissues and paper napkins, as well as bathroom and kitchen paper towels that are

marketed and sold under the Dongfang Paper brand.

In December 2018 and November 2019, we completed the construction,

installation and test of operation of PM8 and PM9, respectively, and commercially launched tissue paper production of PM8 and

PM9 at such time.

On May 5, 2020, the Company announced it planned the commercial launch of a new tissue paper production

line PM10 and the Company signed an agreement to purchase paper machine with paper machine supplier.

The Company expected the

new tissue paper production line to be launched after the completion of trial run.

We currently have two

production lines, PM2 and PM3, for the production of offset printing paper.

Paper Products

began the commercial production of tissue paper products in Wei County Industry Park in June 2015.

We process base tissue paper purchased

from long-term cooperative third party and produce finished tissue paper products, including toilet paper, boxed and soft-packed tissues,

handkerchief tissues and paper napkins, as well as bathroom and kitchen paper towels that are marketed and sold under the Dongfang Paper

In December 2018 and November 2019, we completed the construction, installation and test of operation of PM8 and PM9, respectively,

and commercially launched tissue paper production of PM8 and PM9 at such time.

On May 5, 2020, the Company announced it planned the commercial

launch of a new tissue paper production line PM10 and the Company signed an agreement to purchase paper machine with paper machine supplier.

The Company expected the new tissue paper production line to be launched after the completion of trial run.

Tissue paper products comprised

approximately 4.43% of our total paper production quantities and approximately 8.34% of our total sales revenue for the year

ended December 31, 2020.

April 29, 2020, we launched a production line of non-medical single-use face masks, following the completion

of raw materials preparation, trial run of the equipment and the sample products inspection.

In January 2021, the Company

announced it has submitted an application for the license for its new single-use surgical masks from local

food and drug administration in Hebei province.

Market for our Products

The PRC Paper Making Industry

to the 2019 China Paper Industry Annual Report, issued by the China Paper Association, there were approximately 2,700 paper

and paper board manufacturers (down from 3,700 in 2010) in China, with a total output of 107.65 million tonnes, up by 3.16%

from 104.35 million tonnes in 2018.

Total domestic consumption was 107.04 million tonnes in 2019, up by 2.54% from 104.39

million tonnes in 2018.

with 2010, output in 2019 increased by approximately 3.16% and consumption grew by approximately 2.54%.

The output of paper

and paper board maintained an average growth rate of approximately 1.68% during the ten-year period from 2010 to 2019, while

consumption increased at an average annual rate of 1.73%.

approximately 3.01% of our total paper production quantities and approximately 5.45% of our total sales revenue for the year ended December

April 29, 2020, we launched a production line of non-medical single-use face masks, following the completion of raw materials

preparation, trial run of the equipment and the sample products inspection.

In January 2021, the Company announced it has submitted an

application for the license for its new single-use surgical masks from local food and drug administration in Hebei province, and began

commercial production in November 2021.

for our Products

PRC Paper Making Industry

to the 2020China Paper Industry Annual Report, issued by the China Paper Association, there were approximately 2,500 paper and paper

board manufacturers (down from 2,700 in 2019) in China, with a total output of 112.60 million tonnes, up by 4.60% from 107.65 million

tonnes in 2019.

Total domestic consumption was 118.27 million tonnes in 2020, up by 10.49% from 107.04 million tonnes in 2019.

output of paper and paper board maintained an average growth rate of approximately 1.41% during the ten-year period from 2011to 2020,

while consumption increased at an average annual rate of 2.17%.

The growth is expected to continue.

It is estimated that China

currently has the largest paper and paper board products output and consumption in the world.

It is estimated that China currently

has the largest paper and paper board products output and consumption in the world.

(Data source:

Report of China Paper Manufacturing, May 2020, China Paper Association)

2019Annual Report of China’s

Paper Industry, May 2020, China Paper Association

Corrugating medium

paper production in China totaled 22.20 million tonnes in 2019, a 5.46% increase from 2018.

Consumption of corrugating medium paper

in China amounted to 23.74 million tonnes in 2019, an increase of 7.28% as compared to 2018.

Uncoated offset

printing paper production in China totaled 17.80 million tonnes in 2019, a 1.71% increase from 2018.

Consumption of uncoated offset

printing paper in China amounted to 17.49 million tonnes in 2019, a decrease of 0.11% as compared to 2018.

The paper making industry

in China is concentrated in the east coast provinces.

The largest paper production capacities by province for 2018 and 2019 (the

most recent year for which relevant information is available) are summarized in the table below.

2020 Annual Report of China Paper

Manufacturing, April 2021, China Paper Association)

2020 Annual Report of China’s Paper Industry, April2021, China Paper Association

medium paper production in China totaled 23.90 million tonnes in 2020, a 7.66% increase from 2019.

Consumption of corrugating medium

paper in China amounted to 27.76 million tonnes in 2020, an increase of 16.93% as compared to 2019.

Uncoated offset printing paper

production in China totaled 17.30million tonnes in 2020, a 2.81% decrease from 2019.

Consumption of uncoated offset printing paper in

China amounted to 17.83million tonnes in 2020, an increase of 1.94% as compared to 2019.

paper making industry in China is concentrated in the east coast provinces.

The largest paper production capacities by province for 2019and

2020(the most recent year for which relevant information is available) are summarized in the table below.

The three provinces with largest

capacities showed moderate increases in paper production capacities;

provinces with smaller capacities, such as, Chongqing, Hubei

and Fujian, showed noticeable increases as well.

2018 Capacity

2019 Capacity

Data Sources:

2019 Annual Report of China’s

Paper Industry, May 2020, China Paper Association

generally sell our corrugating medium paper to companies making corrugating cardboards and offset printing paper to printing

Our largest customer is a packaging company in Tianjin City.

Our total corrugating medium and offset printing

paper revenue in 2020 was primarily derived from customers in Tianjin, Hebei Province and Shandong Province.

year ended December 31, 2020, five major customers who individually accounted for more than 5% of our total sales revenue are

(USD$, net of

Company A (Baoding)

Company B (Tianjin)

Company C (Tianjin)

Company D (Hebei)

Company E(Shandong)

Total Major Customers

our top-ten customers of 2020 are also in the top-ten customer list in 2019, representing 78.6% of the 2019 top-ten customer

Target Market

We target corporate

customers in the middle range of the marketplace, where, with solid quality and competitive pricing, we see potential for high

volume growth for corrugating medium paper and offset printing paper.

Our primary market has been the region of North China, especially

in the province of Hebei.

Our Production Lines

During the year ended

December 31, 2020, we had six PM production lines in operation and are in the process of launching one more that are designated

provinces with smaller capacities, such as, Chongqing, Hebei and

Anhui, showed noticeable increases as well.

2020Annual Report of China’s Paper Industry, April 2021, China Paper Association

We generally sell our corrugating

medium paper to companies making corrugating cardboards and offset printing paper to printing companies.

Our largest customer is a packaging

company in Shandong Province.

Our total corrugating medium and offset printing paper revenue in 2021 was primarily derived from customers

in Tianjin City, Hebei Province and Shandong Province.

the year ended December 31, 2021, five major customers who individually accounted for more than 5% of our total sales revenue are as

Company A (Shandong)

Company B (Hebei)

Company C (Hebei)

Company D (Tianjin)

Major Customers

of our top-ten customers of 2021are also in the top-ten customer list in 2020, representing 79.36% of the 2020top-ten customer sales.

target corporate customers in the middle range of the marketplace, where, with solid quality and competitive pricing, we see potential

for high volume growth for corrugating medium paper and offset printing paper.

Our primary market has been the region of North China,

especially in the province of Hebei.

Production Lines

the year ended December 31, 2021, we had six PM production lines in operation and are in the process of launching one more that are designated

These production lines include the followings:

1 unchanged sentence

(tonnes/year)

Status as of December 31, 2020

Corrugating Medium

as of December 31, 2021

Corrugating Medium Paper

Dongfang Paper

12 unchanged sentences

Baoding Shengde

Suspended in June 2016 due to low market

Suspended in June 2016 due to low market demand

Digital Photo Paper

1 unchanged sentence

Baoding Shengde

Suspended in June 2016 due to low market

Corrugating Medium

Suspended in June 2016 due to low market demand

Corrugating Medium Paper

Baoding Shengde

4 unchanged sentences

Dongfang Paper

Under renovation and preparing for launch by the

Under renovation and preparing for launch by the end

Dongfang Paper

7 unchanged sentences

In construction

Paper machines under renovation, under construction, or in

the planning stage.

PM6 is funded and owned by Baoding Shengde;

ancillary facilities

that support the PM6 operation are built and owned by Dongfang Paper.

31, 2009, we acquired a digital photo paper production line, including two coating lines that are designated as PM4 and PM5 and

ancillary equipment, for a total purchase price of approximately $13.6 million.

machines under renovation, under construction, or in the planning stage.

is funded and owned by Baoding Shengde;

ancillary facilities that support the PM6 operation

are built and owned by Dongfang Paper.

December 31, 2009, we acquired a digital photo paper production line, including two coating lines that are designated as PM4 and PM5

and ancillary equipment, for a total purchase price of approximately $13.6 million.

We suspended production of photo paper in June 2016.

In order to meet the

growing domestic demand for paper, which we believe currently exceeds domestic supply in the case of corrugating medium paper,

especially in the region of North China, we installed a corrugating medium paper production line (PM6) with a designed capacity

order to meet the growing domestic demand for paper, which we believe currently exceeds domestic supply in the case of corrugating medium

paper, especially in the region of North China, we installed a corrugating medium paper production line (PM6) with a designed capacity

of 360,000 tonnes per year.

1 unchanged sentence

in December 2011.

We have implemented

a plan to renovate one of the old production lines that has been idle since the end of 2007.

We previously made paper with anti-counterfeit

features from that production line.

When the renovation is completed, we intend to use the renovated production line to produce

high-profit margin specialty papers.

Our current plan is to complete the renovation project, put in place a new production and

marketing team and launch the renovated production line as PM7 by the end of 2021.

November 27, 2012, we signed a 15-year lease relating to approximately 49.4 acres of land in the Economic Development Zone in

Wei County, Hebei Province, China for the purpose of developing a new tissue paper production plant.

We planned to build two

tissue paper production lines, each with 15,000 tonnes/year capacity, and other packaging facilities and infrastructures on

the leased land.

In December 2012, we signed a contract with an equipment contractor in Shanghai to build PM8, the first of

our two tissue paper production lines in Wei County.

In December 2018 and November 2019, we completed the construction,

installation and test of operation of PM8 and PM9, respectively and commercially launched tissue paper productions of PM8 and

PM9 at such time.

On May 5, 2020, the Company announced it planned the commercial launch of a new tissue paper production

line PM10 and the Company signed an agreement to purchase paper machine with paper machine supplier.

The Company expected the

new tissue paper production line to be launched after the completion of trial run.

We voluntarily renovated

our 150,000 tonnes/year corrugating medium paper PM1 in anticipation of increased regulatory concerns on energy efficiencies as

well as to improve the quality of our corrugating medium products.

Rather than converting PM1 to a regular corrugating medium paper

machine, we decided in 2013 that, based on the market conditions and our waste water treatment capability, the better option was

to convert PM1 to produce Light-Weight CMP with a specification of 40 to 80 grams per square meter (“g/s/m”) with a

designed capacity of 60,000 tonnes/year.

We started the renovation in January 2013 and launched commercial production of the renovated

PM1 production line in May 2014.

Raw Materials and Principal Suppliers

The supplies used

in our production processes are comprised mainly of recycled paper board and unprinted recycled white scrap paper, both of which

are ready-to-use items and available from multiple domestic and foreign sources.

have implemented a plan to renovate one of the old production lines that has been idle since the end of 2007.

We previously made paper

with anti-counterfeit features from that production line.

When the renovation is completed, we intend to use the renovated production

line to produce high-profit margin specialty papers.

Our current plan is to complete the renovation project, put in place a new production

and marketing team and launch the renovated production line as PM7 by the end of 2021.

November 27, 2012, we signed a 15-year lease relating to approximately 49.4 acres of land in the Economic Development Zone in Wei County,

Hebei Province, China for the purpose of developing a new tissue paper production plant.

We planned to build two tissue paper production

lines, each with 15,000 tonnes/year capacity, and other packaging facilities and infrastructures on the leased land.

In December 2012,

we signed a contract with an equipment contractor in Shanghai to build PM8, the first of our two tissue paper production lines in Wei

In December 2018 and November 2019, we completed the construction, installation and test of operation of PM8 and PM9, respectively

and commercially launched tissue paper productions of PM8 and PM9 at such time.

On May 5, 2020, the Company announced it planned the

commercial launch of a new tissue paper production line PM10 and the Company signed an agreement to purchase paper machine with paper

machine supplier.

The Company expected the new tissue paper production line to be launched after the completion of trial run.

voluntarily renovated our 150,000 tonnes/year corrugating medium paper PM1 in anticipation of increased regulatory concerns on energy

efficiencies as well as to improve the quality of our corrugating medium products.

Rather than converting PM1 to a regular corrugating

medium paper machine, we decided in 2013 that, based on the market conditions and our waste water treatment capability, the better option

was to convert PM1 to produce Light-Weight CMP with a specification of 40 to 80 grams per square meter (“g/s/m”) with a designed

capacity of 60,000 tonnes/year.

We started the renovation in January 2013 and launched commercial production of the renovated PM1 production

line in May 2014.

Materials and Principal Suppliers

supplies used in our production processes are comprised mainly of recycled paper board and unprinted recycled white scrap paper, both

of which are ready-to-use items and available from multiple domestic and foreign sources.

We currently purchase all of our recycled paper

2 unchanged sentences

from nearby suppliers.

Ongoing inflationary pressures and higher demand for recycled paper could lead to an increase in our costs

of raw materials and production, which we may or may not be able to pass to our customers.

We sign annual raw

materials supplier contracts with our suppliers.

Although we have contracts with our suppliers, these contracts do not lock-in

the purchase price of our raw materials or provide hedge against the fluctuation in the market price of these raw materials.

the year ended December 31, 2020, we had two large suppliers which accounted for approximately 72% and 12% of our total purchases,

Ongoing inflationary pressures and higher demand for recycled paper could lead to an increase in our costs of

raw materials and production, which we may or may not be able to pass to our customers.

sign annual raw materials supplier contracts with our suppliers.

Although we have contracts with our suppliers, these contracts do not

lock-in the purchase price of our raw materials or provide hedge against the fluctuation in the market price of these raw materials.

For the year ended December 31, 2021, we had two large suppliers which accounted for approximately 78% and 11% of our total purchases,

respectively.

For the year ended December 31, 2020, two major suppliers

who individually accounted for more than 5% of our total purchase are as follows:

(USD$, net of

the year ended December 31, 2021, two major suppliers who individually accounted for more than 5% of our total purchase are as follows:

Company A (Baoding)

Company B (Baoding)

Total Major Suppliers

Dongfang Paper’s

main competitors are:

Chenming Paper Group Limited, Huatai Group Limited, Nine Dragons Paper (Holdings) Limited and Sun Paper Group

A number of our competitors are public entities with larger capacities, broader customer bases and greater financial resources

than those available to us.

Major Suppliers

Paper’s main competitors are:

Chenming Paper Group Limited, Huatai Group Limited, Nine Dragons Paper (Holdings) Limited and Sun

Paper Group Limited.

A number of our competitors are public entities with larger capacities, broader customer bases and greater financial

resources than those available to us.

The businesses of our primary competitors are briefly described below:

Paper Group, Ltd.

(“Chenming”), based in Shandong Province (located in northeast China), produces primarily news

print paper and art paper (high quality, heavy and two-side coated printing paper).

Chenming is believed to be the first

company to have listed on all three stock exchanges in China:

Renminbi A-shares and foreign currency B-shares in Shenzhen,

the smaller of the mainland’s two stock exchanges, and H-shares in Hong Kong.

Chenming has annual production capacity

of 8.5 million tonnes for its coated wood-free paper product and is believed to rank among the top 500 enterprises in

Huatai Group, Ltd.

(“Huatai”), based in Shandong Province (located in the northern part of the eastern coastal region of China), primarily

produces newsprint, fine paper, special printing paper, coated board and tissue paper.

(“Chenming”), based in Shandong Province (located in northeast China), produces primarily news print paper

and art paper (high quality, heavy and two-side coated printing paper).

Chenming is believed to be the first company to have listed on

all three stock exchanges in China:

Renminbi A-shares and foreign currency B-shares in Shenzhen, the smaller of the mainland’s

two stock exchanges, and H-shares in Hong Kong.

Chenming has annual production capacity of 8.5 million tonnes for its coated wood-free

paper product and is believed to rank among the top 500 enterprises in China.

(“Huatai”), based in Shandong Province (located in the northern part of the eastern coastal region of China),

primarily produces newsprint, fine paper, special printing paper, coated board and tissue paper.

Huatai is the first Shandong papermaker

1 unchanged sentence

Its annual paper production is estimated to have reached 4 million

Nine Dragons Paper

(Holdings) Limited (“ND Paper”), based in Guangdong Province (located in southern China), is the largest paper manufacturer

in China and primarily produces kraft paper and high-strength corrugating medium paper with annual capacity of 13 million tonnes.

ND Paper has reported that it has five production lines in the city of Tianjin with a total designed capacity of 2.15 million tonnes,

producing products such as kraft paper, high strength corrugating medium paper and grey-back duplex board.

Group, Ltd., based in Shandong Province, primarily produces card paper, whiteboard paper and art paper.

It also produces

alkaline peroxide mechanical pulp, sourced in part from wood chips harvested by the company’s poplar plantations.

company has reported that it has an aggregate annual production capacity of paper and pulp of approximately 5.7 million

tonnes and has been listed on the Shenzhen Stock Exchange since 2006.

With the exceptions

of Chenming and ND Paper, which may compete directly with us in the offset printing paper market and the corrugating medium paper

market, respectively, in the Beijing/Tianjin/greater Hebei regions, we believe that we face only indirect competition from the

above-listed companies, either because we have a different product assortment from these companies, or because, to the extent they

do offer products similar to ours, the transportation costs and storage costs make it difficult for these companies to compete

effectively with us on pricing.

Our Competitive Edge

Nine Dragons Paper (Holdings)

Limited (“ND Paper”), based in Guangdong Province (located in southern China), is the largest paper manufacturer in China

and primarily produces craft paper and high-strength corrugating medium paper with annual capacity of 13 million tonnes.

reported that it has five production lines in the city of Tianjin with a total designed capacity of 2.15 million tonnes, producing products

such as craft paper, high strength corrugating medium paper and grey-back duplex board.

Paper Group, Ltd., based in Shandong Province, primarily produces card paper, whiteboard paper and art paper.

It also produces alkaline

peroxide mechanical pulp, sourced in part from wood chips harvested by the company’s poplar plantations.

This company has reported

that it has an aggregate annual production capacity of paper and pulp of approximately 5.7 million tonnes and has been listed on the

Shenzhen Stock Exchange since 2006.

the exceptions of Chenming and ND Paper, which may compete directly with us in the offset printing paper market and the corrugating medium

paper market, respectively, in the Beijing/Tianjin/greater Hebei regions, we believe that we face only indirect competition from the

above-listed companies, either because we have a different product assortment from these companies, or because, to the extent they do

offer products similar to ours, the transportation costs and storage costs make it difficult for these companies to compete effectively

with us on pricing.

Competitive Edge

advantage (Northern China) .

We believe that Dongfang Paper is one of the leading papermaking enterprises in Hebei

Our proximity to large urban centers in northern China, Beijing and Tianjin, gives us access to a large market to

sell our products.

There are other paper

manufacturers that are also located in Hebei Province (and close to metropolitan Beijing and Tianjin areas), but most of these

other manufacturers are small in scale and unable to compete with us effectively.

We also compete with other large printing paper

manufacturers for Beijing printing company customers.

We believe that Dongfang Paper is one of the leading papermaking enterprises in Hebei Province.

Our proximity

to large urban centers in northern China, Beijing and Tianjin, gives us access to a large market to sell our products.

are other paper manufacturers that are also located in Hebei Province (and close to metropolitan Beijing and Tianjin areas), but most

of these other manufacturers are small in scale and unable to compete with us effectively.

We also compete with other large printing

paper manufacturers for Beijing printing company customers.

We believe that we have cost and geographical advantages over these larger

Unlike some of our out-of-province competitors who must set up interim warehouses and ship products from their

production base to such interim warehouses close to their customer base in Beijing, there is no need for us to set up interim

warehouses, because we are approximately 60 miles (100 kilometers) from Beijing, the cultural center of China and our largest

target market.

While we do not separately pay for transportation cost on raw material purchases, the transportation cost

included in the raw material purchase prices from our recycled paper suppliers is lower than the transportation cost paid by

our competitors in the province of Shandong.

We also enjoy lower transportation costs for coal, a major source of energy used

in our production process.

Similarly, our customers pay lower transportation cost to pick up their orders from our finished

goods warehouse in Baoding than what they would pay if they had to pick up goods from locations further away from Beijing.

Unlike some of our out-of-province competitors who must set up interim warehouses and ship products from their production

base to such interim warehouses close to their customer base in Beijing, there is no need for us to set up interim warehouses, because

we are approximately 60 miles (100 kilometers) from Beijing, the cultural center of China and our largest target market.

not separately pay for transportation cost on raw material purchases, the transportation cost included in the raw material purchase prices

from our recycled paper suppliers is lower than the transportation cost paid by our competitors in the province of Shandong.

enjoy lower transportation costs for coal, a major source of energy used in our production process.

Similarly, our customers pay lower

transportation cost to pick up their orders from our finished goods warehouse in Baoding than what they would pay if they had to pick

up goods from locations further away from Beijing.

Tianjin, another large urban center, is also approximately 60 miles from our facilities.

Baoding city itself is also home to

numerous printing and packaging companies.

Our geographical advantage and easy access to low-cost raw materials allow us to

implement a more flexible inventory purchase policy, lower our purchase prices and inventory management expenses and reduce

our production cost.

As such, we have lower freight costs and other associated costs of sales, which enable us to charge

lower prices, if necessary, for our products.

Additionally, because we buy all recycled paper raw materials from Beijing and

Tianjin, rather than from the United States or Japan, our purchase lead time is shorter as compared to manufacturers who rely

on imported recycled paper.

Research and Development

R&D activities are carried out by a task force led by a group of senior managers (in charge of product development and

quality control) and by a group of selected engineers and technicians.

The Company charged the time spent on the R&D

projects (manufacturing waste discharge recycling, digital photo paper and tissue paper manufacturing) to R&D expenses.

Our R&D efforts in 2020 has focused on evaluating and developing new products that are in the pipeline for 2020 and

included developing and improving the manufacturing process of Light-Weight CMP and the production and packaging technology

of tissue paper.

One of our production

lines, PM7, is under renovation.

Since the fourth quarter of 2010, we have spent approximately $1.57 million in machine parts and

new components to renovate this production line, with which we expect to produce certain specialty papers, including wood-grain

Baoding city itself is also home to numerous printing and packaging companies.

Our geographical advantage and easy access to low-cost

raw materials allow us to implement a more flexible inventory purchase policy, lower our purchase prices and inventory management expenses

and reduce our production cost.

As such, we have lower freight costs and other associated costs of sales, which enable us to charge lower

prices, if necessary, for our products.

Additionally, because we buy all recycled paper raw materials from Beijing and Tianjin, rather

than from the United States or Japan, our purchase lead time is shorter as compared to manufacturers who rely on imported recycled paper.

and Development

R&D activities are carried out by a task force led by a group of senior managers (in charge of product development and quality control)

and by a group of selected engineers and technicians.

The Company charged the time spent on the R&D projects (manufacturing waste

discharge recycling, digital photo paper and tissue paper manufacturing) to R&D expenses.

Our R&D efforts in 2020 has focused

on evaluating and developing new products that are in the pipeline for 2020 and included developing and improving the manufacturing process

of Light-Weight CMP and the production and packaging technology of tissue paper.

of our production lines, PM7, is under renovation.

Since the fourth quarter of 2010, we have spent approximately $1.57 million in machine

parts and new components to renovate this production line, with which we expect to produce certain specialty papers, including wood-grain

deco and furniture paper, wallpaper and paper with security features (for anti-counterfeiting purposes).

While we are optimistic

about the prospect of the specialty papers, we cannot guarantee the launch of the specialty paper production (which is tentatively

scheduled by the end of 2020) or the success of such renovation.

Intellectual Property

company has registered nine trademarks with the Trademark Bureau under the State of Administration for Industry &

Certificate No.

Fax paper, thermal paper, blueprint paper, sensitized paper, spectrum sensitized paper, blueprint cloth, photographic paper, cyanotype solution, diazo paper

Dongfang Paper

April 7, 2014 through April 6, 2024

Toilet paper, handkerchief tissues, tissues, paper napkins, paper mats, beer mats, paper place mats, printing paper (including offset paper, newsprint, books paper, bond paper, plate paper and halftone paper), coated paper

Dongfang Paper

December 28, 2014 through December 27, 2024

Toilet paper, handkerchief tissues, tissues for makeup remover, paper napkin, tissues, paper duster cloth, paper face towels, paper table cloth, paper tablecloths, drawer liner (with or without flavor)

Dongfang Paper

December 28, 2014 through December 27, 2024

Xuan Paper (for traditional Chinese painting and calligraphy), Paper, tissue paper, watercolor paper, writing paper, printing publications, ink, painting brush, packaging plastic film, color box,

Baoding Shengde

July 28, 2017 through July 27, 2027

Drying blueprint solution, diazo paper, photographic paper, sensitive paper, blueprint paper, blueprint canvas, spectral photographic plate, heliographic paper

Baoding Shengde

June 14, 2011 through June 13, 2021

Paper table cover, paper pinafore, drawer lining (with flavor or not)

Hebei Tengsheng

November 21, 2016 through November 20, 2026

paper, paper handkerchief, paper napkin, facial paper, grained paper, cardboard, white board, container board, kraft liner,

corrugated medium paper (board)

Hebei Tengsheng

January 7, 2016 through January 6, 2026

Paper, tissue paper, paper handkerchief, paper napkin, facial paper, paper billboard, cleansing tissue, packaging paper or plastic bag (envelop, sachet), carton, paper box

While we are optimistic about

the prospect of the specialty papers, we cannot guarantee the launch of the specialty paper production (which is tentatively scheduled

by the end of 2020) or the success of such renovation.

Company has registered nine trademarks with the Trademark Bureau under the State of Administration for Industry & Commerce.

paper, thermal paper, blueprint paper, sensitized paper, spectrum sensitized paper, blueprint cloth, photographic paper, cyanotype

solution, diazo paper

7, 2014 through April 6, 2024

paper, handkerchief tissues, tissues, paper napkins, paper mats, beer mats, paper place mats, printing paper (including offset paper,

newsprint, books paper, bond paper, plate paper and halftone paper), coated paper

28, 2014 through December 27, 2024

paper, handkerchief tissues, tissues for makeup remover, paper napkin, tissues, paper duster cloth, paper face towels, paper table

cloth, paper tablecloths, drawer liner (with or without flavor)

28, 2014 through December 27, 2024

Paper (for traditional Chinese painting and calligraphy), Paper, tissue paper, watercolor paper, writing paper, printing publications,

ink, painting brush, packaging plastic film, color box,

28, 2017 through July 27, 2027

blueprint solution, diazo paper, photographic paper, sensitive paper, blueprint paper, blueprint canvas, spectral photographic plate,

heliographic paper

14, 2011 through June 13, 2021

Paper table cover, paper

pinafore, drawer lining (with flavor or not)

Hebei Tengsheng

July 14, 2017 through July 13, 2027

Coasters, paper table cover, paper costers, cleansing paper

November 21, 2016 through

November 20, 2026

paper, paper handkerchief, paper napkin, facial paper, grained paper, cardboard, white board, container board, kraft liner, corrugated

medium paper (board)

7, 2016 through January 6, 2026

tissue paper, paper handkerchief, paper napkin, facial paper, paper billboard, cleansing tissue, packaging paper or plastic bag (envelop,

sachet), carton, paper box

14, 2017 through July 13, 2027

Coasters, paper table cover,

paper costers, cleansing paper

Hebei Tengsheng

February 28, 2016 through February 27, 2026

IT Tech Packaging has registered the internet domain

name, http://www.itpackaging.cn.

Government Regulation

The testing, approval,

manufacturing, labeling, advertising and marketing, post-approval safety reporting and export of our products are extensively regulated

by governmental authorities in the PRC.

We are also subject to various other regulations and permit requirements by the Chinese

February 28, 2016 through

February 27, 2026

Company has also been granted twelve new utility patent certificates on paper manufacturing related equipment issued by the State Intellectual

Property Office, including equipment testing, screening and filtering, and mixing.

model relates to a pulp mixing device

2021 through July23, 2031

The invention

relates to a product processing and cutting device

2021 through July23, 2031

model relates to a packaging equipment for pulp waste

8, 2021 through October 8, 2031

model relates to a pulp crushing device

24, 2021 through Sep.

model relates to a pulp screening and separation device

24, 2021 through Sep.

model relates to a pulp raw material processing device

24, 2021 through Sep.

model relates to a forming tool for paper pulp products

24, 2021 through Sep.

model relates to a material mixing device for paper processing

24, 2021 through Sep.

The invention

relates to a pulp concentration detecting device

22, 2021 through June 22, 2031

model relates to a recycling device for edge material used in paper processing

27, 2021 through August 27, 2031

model relates to a pulp filter dehydration device

6, 2020 through August 6, 2031

model relates to a storage rack for raw material used in paper processing

6, 2020 through August 6, 2031

Tech Packaging has registered the internet domain name, http://www.itpackaging.cn.

testing, approval, manufacturing, labeling, advertising and marketing, post-approval safety reporting and export of our products are

extensively regulated by governmental authorities in the PRC.

We are also subject to various other regulations and permit requirements

by the Chinese government.

These regulations and their impact on our business are set forth in more details below.

Environmental Regulation

Our operations

and facilities are subject to environmental laws and regulations stipulated by the national and the local environment protection

Environmental

operations and facilities are subject to environmental laws and regulations stipulated by the national and the local environment protection

bureaus in the PRC.

Since the implementation

of the State Council’s “Decisions on Environmental Protection Issues”

in 1996, the PRC paper industry has been

subject to more rigorous environmental standards.

Effective January 1, 2015, a new law promulgated by the National People’s

Congress of the People’s Republic of China makes certain violations of the environmental laws a criminal offense.

that we are one of the few major paper manufacturers in Hebei Province that have obtained a Pollution Discharge Permit.

received the permit in September 1996 and, we have successfully renewed the permit each year by complying with applicable environmental

requirements.

Waste Water Treatment

Dongfang Paper uses

a multi-level water recycling process.

Waste water from the pulping process is fed into collection pools, where it is divided into

two parts, water and recovered pulp fiber.

the implementation of the State Council’s “Decisions on Environmental Protection Issues” in 1996, the PRC paper industry

has been subject to more rigorous environmental standards.

Effective January 1, 2015, a new law promulgated by the National People’s

Congress of the People’s Republic of China makes certain violations of the environmental laws a criminal offense.

We believe that

we are one of the few major paper manufacturers in Hebei Province that have obtained a Pollution Discharge Permit.

We initially received

the permit in September 1996 and, we have successfully renewed the permit each year by complying with applicable environmental requirements.

Water Treatment

Paper uses a multi-level water recycling process.

Waste water from the pulping process is fed into collection pools, where it is divided

into two parts, water and recovered pulp fiber.

The latter is returned to the pulping process.

Chemical agents are

added to the waste water, and the waste water is fed into a biogas reactor and filtering pools, producing purified water and depositing

Most of the purified water is recycled to produce corrugating medium paper and the sludge is pumped into a sludge pool,

condensed and dehydrated.

agents are added to the waste water, and the waste water is fed into a biogas reactor and filtering pools, producing purified water and

depositing sludge.

Most of the purified water is recycled to produce corrugating medium paper and the sludge is pumped into a sludge

pool, condensed and dehydrated.

We then use the sludge as a raw material in the manufacture of corrugating medium paper.

We maintain computerized

controls at our production facilities on a 24-hour basis to monitor compliance with environmental rules and regulations.

not aware of any environmental investigations, prosecutions, disputes, claims or other environmental proceedings, nor have we been

subject to any action by any environmental administration authorities of the PRC.

maintain computerized controls at our production facilities on a 24-hour basis to monitor compliance with environmental rules and regulations.

We are not aware of any environmental investigations, prosecutions, disputes, claims or other environmental proceedings, nor have we

been subject to any action by any environmental administration authorities of the PRC.

To our knowledge, our operations meet or exceed

the existing environmental requirements of the PRC.

Human Capital Resources

Employee Profiles

As of December 31,

2020, we have approximately 333 full time employees, all of whom were based in PRC.

Capital Resources

of December 31, 2021, we have approximately 366full time employees, all of whom were based in PRC.

As of December 31, 2021, approximately

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We generally maintain good relations with our employees and the labor union.

Total Rewards

Our compensation program

is designed to attract and reward talented individuals who possess the skills necessary to support our business objectives, assist

in the achievement of our strategic goals and create long-term value for our stockholders.

We provide employees with compensation

packages that include base salary and annual incentive bonuses.

We also provide private insurance coverage for any workplace accident

or injury for all the operators of paper milling machinery in the workshops.

Health and Safety

The success of our

business is fundamentally connected to the well-being of our people.

Accordingly, we are committed to the health, safety and wellness

of our employees.

We provide our employees and their families with access to a variety of flexible and convenient health and welfare

programs, including benefits that support their physical and mental health by providing tools and resources to help them improve

or maintain their health status;

compensation program is designed to attract and reward talented individuals who possess the skills necessary to support our business

objectives, assist in the achievement of our strategic goals and create long-term value for our stockholders.

We provide employees with

compensation packages that include base salary and annual incentive bonuses.

We also provide private insurance coverage for any workplace

accident or injury for all the operators of paper milling machinery in the workshops.

success of our business is fundamentally connected to the well-being of our people.

Accordingly, we are committed to the health, safety

and wellness of our employees.

We provide our employees and their families with access to a variety of flexible and convenient health

and welfare programs, including benefits that support their physical and mental health by providing tools and resources to help them

improve or maintain their health status;

and that offer choice where possible so they can customize their benefits to meet their needs

and the needs of their families.

In response to the COVID-19 pandemic, we implemented significant operating environment changes

that we determined were in the best interest of our employees, as well as the communities in which we operate, and which comply

with government regulations.

This includes having the vast majority of our employees work from home, while implementing additional

safety measures for employees continuing critical on-site work.

A core tenet of our

talent system is to both develop talent from within and supplement with external hires.

This approach has yielded loyalty and commitment

in our employee base which in turn grows our business, our products, and our customers, while adding new employees and external

ideas supports a continuous improvement mindset and our goals of a diverse and inclusive workforce.

Our human resources team uses

internal and external resources to recruit highly skilled and talented workers in the PRC, and we encourage employee referrals

for open positions.

Available Information

We are required to

file annual, quarterly and current reports, proxy statements and other information with the U.S.

Securities and Exchange Commission

(“SEC”).

In response to the COVID-19 pandemic, we implemented significant operating environment changes that

we determined were in the best interest of our employees, as well as the communities in which we operate, and which comply with government

core tenet of our talent system is to both develop talent from within and supplement with external hires.

This approach has yielded loyalty

and commitment in our employee base which in turn grows our business, our products, and our customers, while adding new employees and

external ideas supports a continuous improvement mindset and our goals of a diverse and inclusive workforce.

Our human resources team

uses internal and external resources to recruit highly skilled and talented workers in the PRC, and we encourage employee referrals for

open positions.

are required to file annual, quarterly and current reports, proxy statements and other information with the U.S.

Securities and Exchange

Commission (“SEC”).

The public may read and copy any materials that we file with the SEC.

In addition, the SEC maintains an Internet

site that contains reports, proxy and information statements, and other information regarding issuers like our Company that file

electronically with the SEC at http://www.sec.gov.

Our Annual Reports

on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to those reports (including

exhibits) filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are also available

free of charge on our Internet site at http://www.itpackaging.cn as soon as reasonably practicable after such reports are electronically

In addition, the SEC maintains

an Internet site that contains reports, proxy and information statements, and other information regarding issuers like our Company that

file electronically with the SEC at http://www.sec.gov.

Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, proxy statements and amendments to those reports

(including exhibits) filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are also

available free of charge on our Internet site at http://www.itpackaging.cn as soon as reasonably practicable after such reports are electronically

filed with or furnished to the SEC.

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into this or any of our other filings with the SEC.

Executive Officers

For information regarding

our executive officers as of March 23, 2021, see Part III, Item 10, “Directors, Executive Officers and Corporate Governance.”

information regarding our executive officers as of March 15, 2022, see Part III, Item 10, “Directors, Executive Officers and Corporate

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 1. Business