What changed in this filing

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Item 1A. Risk Factors

2024-03-27 compared with 2023-03-24 · 823 added, 798 removed, 637 unchanged (72% of the section changed)

Relating to our Business

business, financial condition and results of operations may be materially adversely affected by global health epidemics, including the

COVID-19 pandemic.

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 COVID-19 pandemic has resulted in a widespread health crisis that has adversely affected the economies and

financial markets worldwide..

Government efforts to contain the spread of the coronavirus including lockdowns of cities, business closures,

restrictions on travel and emergency quarantines, and responses by businesses and individuals to reduce the risk of exposure to infection,

including reduced travel, cancellation of meetings and events, and implementation of work-at-home policies, have caused significant disruptions

to the global economy and normal business operations.

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

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.

For the year 2022, COVID-19 caused temporary closure of our CMP production and offset printing

paper was suspended for the whole year, and as a result, our revenue of CMP decreased by 26.60% for 2022.

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.

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 2023

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 corona virus or treat its impact, among others.

Existing insurance coverage may not provide

protection for all costs that may arise from all such possible events.

We continue to assess the related risks and impacts that the COVID-19

pandemic might have on our business and financial performance.

Until such time as the COVID-19 pandemic is contained or eradicated and

global business return to more customary levels, our business and financial results might be materially adversely affected.

the basis of scientific assessment of the characteristics of the virus and the pandemic situation, as well as reference to the prevention

practices of other countries, at the end of 2022, the Chinese government refined its COVID-19 prevention and control measures and stopped

conducting nucleic acid testing for all residents.

By the end of 2022, vaccination rate has exceeded 90%.

And normal life is returning.

Under such circumstances, the government has taken positive service measures, including tax incentives, bank loan and financial support,

etc, to support domestic enterprises to overcome difficulties.

The market consolidation will be expedited eventually.

We have been actively

cooperating with the government in implementing corresponding epidemic control measures to fulfill our social responsibility, by early

prevention and control, to ensure the minimize adverse impact of the epidemic.

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

Paper commenced its current line of business operations in 1996 and received its initial Pollution Discharge Permit in September 1996,

which must be renewed every year for Dongfang Paper to stay in business.

Although we have never had problem renewing the Pollution Discharge

Permit, we cannot guarantee automatic renewal every year.

In addition, Baoding Shengde commenced its current line of business operations

Therefore, our operating history may not provide a more meaningful basis on which to evaluate its business.

We cannot assure

you that Dongfang Paper or Baoding Shengde will not incur net losses in the future.

We expect that operating expenses of Dongfang Paper

and Baoding Shengde will increase as they expand.

Any significant failure to realize anticipated revenue growth could result in significant

operating losses.

We will continue to encounter risks and difficulties frequently experienced by companies at a similar stage of development,

including our potential failure to:

adequate capital for expansion and operations;

our business model and strategy and adapt and modify them as needed;

awareness of our brand name, protect our reputation and develop customer loyalty;

our expanding operations and service offerings, including the integration of any future acquisitions;

adequate control of our expenses;

and adapt to changing conditions in paper markets in which we operate as well as the impact

of any changes in government regulations, mergers and acquisitions involving our competitors,

technological developments and other significant competitive and market dynamics.

we are not successful in addressing any or all of these risks, our business may be materially and adversely affected.

Paper and Baoding Shengde’s failure to compete effectively may adversely affect our ability to generate revenue.

Dongfang Paper and Baoding Shengde, we compete in a highly developed market with companies that have significantly greater experience

and history in our industry.

If we do not compete effectively, we could lose market share and experience reduced selling prices, adversely

affecting our financial results.

Risks Relating to our Business

Our operating history may not serve as an adequate basis to judge

our future prospects and results of operations.

Dongfang Paper commenced

its current line of business operations in 1996 and received its initial Pollution Discharge Permit in September 1996, which must be renewed

every year for Dongfang Paper to stay in business.

Although we have never had problem renewing the Pollution Discharge Permit, we cannot

guarantee automatic renewal every year.

In addition, Baoding Shengde commenced its current line of business operations in 2009.

our operating history may not provide a more meaningful basis on which to evaluate its business.

We cannot assure you that Dongfang Paper

or Baoding Shengde will not incur net losses in the future.

We expect that operating expenses of Dongfang Paper and Baoding Shengde will

increase as they expand.

Any significant failure to realize anticipated revenue growth could result in significant operating losses.

will continue to encounter risks and difficulties frequently experienced by companies at a similar stage of development, including our

potential failure to:

● raise adequate capital for expansion and operations;

● implement our business model and strategy and adapt and modify them as needed;

● increase awareness of our brand name, protect our reputation and develop customer loyalty;

● manage our expanding operations and service offerings, including the integration of any future acquisitions;

● maintain adequate control of our expenses;

● anticipate and adapt to changing conditions in paper markets in which we operate as well as the impact

of any changes in government regulations, mergers and acquisitions involving our competitors, technological developments and other significant

competitive and market dynamics.

If we are not successful in addressing any or all of these

risks, our business may be materially and adversely affected.

Dongfang Paper and Baoding Shengde’s failure to compete

effectively may adversely affect our ability to generate revenue.

Through Dongfang Paper and

Baoding Shengde, we compete in a highly developed market with companies that have significantly greater experience and history in our

If we do not compete effectively, we could lose market share and experience reduced selling prices, adversely affecting our

financial results.

Our competitors will expand in the key markets and implement new technologies making them more competitive.

There is also the possibility that competitors will be able to offer additional products, services, lower prices, or other incentives

that we cannot or will not offer or that will make our products less profitable.

We cannot assure you that we will be able to compete

effectively with current or future competitors or that the competitive pressures we face will not harm our business.

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

our business and markets grow and develop, it will be necessary for us to finance and manage expansion in an orderly fashion.

would increase demands on existing management, workforce and facilities.

Failure to satisfy such increased demands could interrupt or

adversely affect our operations and cause delay in production and delivery of our paper products, as well as administrative inefficiencies.

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.

through our subsidiaries, may review acquisition and strategic investment prospects that we believe would complement the current product

offerings of Dongfang Paper, augment its market coverage or enhance its technical capabilities, or otherwise offer growth opportunities.

From time to time we review investments in new businesses and we, through our subsidiaries, expect to make investments in, and to acquire,

businesses, products, or technologies in the future.

We expect that when we raise funds from investors for any of these purposes we will

be either the issuer or the primary obligor while the proceeds will be forwarded to Dongfang Paper.

In the event of any future acquisitions,

equity securities which would dilute current stockholders’ percentage ownership;

substantial debt;

contingent liabilities;

significant cash.

actions could have a material adverse effect on our operating results or the price of our common stock.

Moreover, even if we do obtain

benefits in the form of increased sales and earnings, there may be a lag between the time when the expenses associated with an acquisition

are incurred and the time when we recognize such benefits.

also the possibility that competitors will be able to offer additional products, services, lower prices, or other incentives that we cannot

or will not offer or that will make our products less profitable.

We cannot assure you that we will be able to compete effectively with

current or future competitors or that the competitive pressures we face will not harm our business.

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

If our business and markets

grow and develop, it will be necessary for us to finance and manage expansion in an orderly fashion.

An expansion would increase demands

on existing management, workforce and facilities.

Failure to satisfy such increased demands could interrupt or adversely affect our operations

and cause delay in production and delivery of our paper products, as well as administrative inefficiencies.

We, 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

We, through our subsidiaries,

may review acquisition and strategic investment prospects that we believe would complement the current product offerings of Dongfang Paper,

augment its market coverage or enhance its technical capabilities, or otherwise offer growth opportunities.

From time to time we review

investments in new businesses and we, through our subsidiaries, expect to make investments in, and to acquire, businesses, products, or

technologies in the future.

We expect that when we raise funds from investors for any of these purposes we will be either the issuer or

the primary obligor while the proceeds will be forwarded to Dongfang Paper.

In the event of any future acquisitions, we could:

● issue equity securities which would dilute current stockholders’ percentage ownership;

● incur substantial debt;

● assume contingent liabilities;

● expend significant cash.

These actions could have

a material adverse effect on our operating results or the price of our common stock.

Moreover, even if we do obtain benefits in the form

of increased sales and earnings, there may be a lag between the time when the expenses associated with an acquisition are incurred and

the time when we recognize such benefits.

Acquisitions and investment activities also entail numerous risks, including:

● difficulties

in the assimilation of acquired operations, technologies and/or products;

● unanticipated

costs associated with the acquisition or investment transaction;

diversion of management’s attention from other business concerns;

effects on existing business relationships with suppliers and customers;

associated with entering markets in which Dongfang Paper has no or limited prior experience;

potential loss of key employees of acquired organizations;

● substantial

charges for the amortization of certain purchased intangible assets, deferred stock compensation

or similar items.

cannot ensure that we will be able to successfully integrate any businesses, products, technology, or personnel that we might acquire

in the future and our failure to do so could have a material adverse effect on our and/or Dongfang Paper’s business, operating

results and financial condition.

are responsible for the indemnification of our officers and directors.

Articles of Incorporation provides for the indemnification and/or exculpation of our directors, officers, employees, agents and other

entities which deal with us to the maximum extent provided, and under the terms provided, by the laws and decisions of the courts of

the state of Nevada.

Although we do maintain professional error and omission insurance for the officers and directors, due to limitations

of the insurance coverage these indemnification provisions could still result in substantial expenditures which we may be unable to recoup

through the insurance and could adversely affect our business and financial conditions.

Zhenyong Liu, our Chairman of the Board and Chief

Executive Officer, Jing Hao, our Chief Financial Officer, Dahong Zhou, our Secretary, and Marco Ku Hon Wai, Wenbing Christopher Wang,

Lusha Niu, and Fuzeng Liu, our directors, are key personnel with rights to indemnification under our Articles of Incorporation.

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.

success is, to a certain extent, attributable to the management, sales and marketing, and paper factory operational expertise of key

Zhenyong Liu, our Chief Executive Officer and Chairman of the Board, Jing Hao, our Chief Financial Officer, Dahong Zhou, our

Secretary, and Shuting Liang, Dongfang Paper’s General Engineer, Gengqi Yang, Dongfang Paper’s Vice President of Sales and

Marketing, Xuetao Chen, Dongfang Paper’s Vice President of Environmental Protection and Xiaodong Liu, Baoding Shengde’s General

Manager, perform key functions in the operation of our business.

There can be no assurance that IT Tech Packaging, Dongfang Paper or

Baoding Shengde will be able to retain these officers after the term of their employment contracts expire.

The loss of these officers

could have a material adverse effect upon our business, financial condition, and results of operations.

We do not carry key man life

insurance for any of our key personnel or personnel nor do we foresee purchasing such insurance to protect against a loss of key personnel

and personnel.

are dependent upon the services of Mr.

Zhenyong Liu for the continued growth and operation of our Company because of his experience in

the industry and his personal and business contacts in the PRC.

Liu has entered into an employment agreement with Baoding

Shengde, our wholly owned subsidiary and a PRC company, and that we have no reason to believe that Mr.

Liu will discontinue his services

with us or Dongfang Paper, the interruption or loss of his services would adversely affect our ability to effectively run our business

and pursue our business strategy as well as our 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.

must attract, recruit and retain a sizeable workforce of technically competent employees.

Competition for senior management and senior

personnel in the PRC is intense, the pool of qualified candidates in the PRC is very limited, and we may not be able to retain the services

of our senior executives or senior personnel, or attract and retain high-quality senior executives or senior personnel in the future.

This failure could materially and adversely affect our future growth and financial condition.

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

operating results may fluctuate significantly in the future as a result of a variety of factors, many of which are beyond our control.

● difficulties in the assimilation of acquired operations, technologies and/or products;

● unanticipated costs associated with the acquisition or investment transaction;

● the diversion of management’s attention from other business concerns;

● adverse effects on existing business relationships with suppliers and customers;

● risks associated with entering markets in which Dongfang Paper has no or limited prior experience;

● the potential loss of key employees of acquired organizations;

● substantial charges for the amortization of certain purchased intangible assets, deferred stock compensation or similar items.

We cannot ensure that we

will be able to successfully integrate any businesses, products, technology, or personnel that we might acquire in the future and our

failure to do so could have a material adverse effect on our and/or Dongfang Paper’s business, operating results and financial condition.

We are responsible for the indemnification of our officers and

Our Articles of Incorporation

provides for the indemnification and/or exculpation of our directors, officers, employees, agents and other entities which deal with us

to the maximum extent provided, and under the terms provided, by the laws and decisions of the courts of the state of Nevada.

we do maintain professional error and omission insurance for the officers and directors, due to limitations of the insurance coverage

these indemnification provisions could still result in substantial expenditures which we may be unable to recoup through the insurance

and could adversely affect our business and financial conditions.

Zhenyong Liu, our Chairman of the Board and Chief Executive Officer,

Jing Hao, our Chief Financial Officer, Dahong Zhou, our Secretary, and Marco Ku Hon Wai, Wenbing Christopher Wang, Lusha Niu, and Fuzeng

Liu, our directors, are key personnel with rights to indemnification under our Articles of Incorporation.

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 success is, to a certain

extent, attributable to the management, sales and marketing, and paper factory operational expertise of key personnel.

Zhenyong Liu, our

Chief Executive Officer and Chairman of the Board, Jing Hao, our Chief Financial Officer, Dahong Zhou, our Secretary, and Shuting Liang,

Dongfang Paper’s General Engineer, Gengqi Yang, Dongfang Paper’s Vice President of Sales and Marketing, Xuetao Chen, Dongfang

Paper’s Vice President of Environmental Protection and Xiaodong Liu, Baoding Shengde’s General Manager, perform key functions

in the operation of our business.

There can be no assurance that IT Tech Packaging, Dongfang Paper or Baoding Shengde will be able to

retain these officers after the term of their employment contracts expire.

The loss of these officers could have a material adverse effect

upon our business, financial condition, and results of operations.

We do not carry key man life insurance for any of our key personnel

or personnel nor do we foresee purchasing such insurance to protect against a loss of key personnel and personnel.

We are dependent upon the

services of Mr.

Zhenyong Liu for the continued growth and operation of our company because of his experience in the industry and his personal

and business contacts in the PRC.

Liu has entered into an employment agreement with Baoding Shengde, our wholly owned subsidiary

and a PRC company, and that we have no reason to believe that Mr.

Liu will discontinue his services with us or Dongfang Paper, the interruption

or loss of his services would adversely affect our ability to effectively run our business and pursue our business strategy as well as

our results of operations.

We may not be able to hire and retain qualified

personnel to support our growth and if we are unable to retain or hire these personnel in the future, our ability to improve our products

and implement our business objectives could be adversely affected.

We must attract, recruit

and retain a sizeable workforce of technically competent employees.

Competition for senior management and senior personnel in the PRC

is intense, the pool of qualified candidates in the PRC is very limited, and we may not be able to retain the services of our senior executives

or senior personnel, or attract and retain high-quality senior executives or senior personnel in the future.

This failure could materially

and adversely affect our future growth and financial condition.

Our operating results may fluctuate as a result of factors beyond

Our operating results

may fluctuate significantly in the future as a result of a variety of factors, many of which are beyond our control.

These factors include:

costs of paper products and development;

relative speed and success with which we can obtain and maintain customers, merchants and

vendors for our products;

expenditure for equipment;

and promotional activities and other costs;

in our pricing policies, suppliers and competitors;

ability of our suppliers to provide products in a timely manner to their customers;

in operating expenses;

competition in the paper markets;

general economic and seasonal factors.

face risks related to product liability claims.

presently do not maintain product liability insurance.

We face the risk of loss because of adverse publicity associated with product

liability lawsuits, whether or not such claims are valid.

● the costs of paper products and development;

● the relative speed and success with which we can obtain and maintain customers, merchants and vendors for our products;

● capital expenditure for equipment;

● marketing and promotional activities and other costs;

● changes in our pricing policies, suppliers and competitors;

● the ability of our suppliers to provide products in a timely manner to their customers;

● changes in operating expenses;

● increased competition in the paper markets;

● other general economic and seasonal factors.

We face risks related to product liability claims.

We presently do not maintain

product liability insurance.

We face the risk of loss because of adverse publicity associated with product liability lawsuits, whether

or not such claims are valid.

We may not be able to avoid such claims.

Although product liability lawsuits

in the PRC are rare, and we have not, to date, experienced significant failure of our products, there is no guarantee that we will not

face such liability in the future.

This liability could be substantial and the occurrence of such loss or liability may have a material

adverse effect on our business, financial condition and prospects.

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

addition to our dependence upon wood pulp, recycled white scrap paper and paperboard costs, our operating results depend on the availability

and pricing of energy and other raw materials.

An interruption in the supply of supplemental chemical agents could cause a material disruption

Although product liability lawsuits in the PRC are rare, and we

have not, to date, experienced significant failure of our products, there is no guarantee that we will not face such liability in the

This liability could be substantial and the occurrence of such loss or liability may have a material adverse effect on our business,

financial condition and prospects.

Our operating results also depend on the availability and pricing

of energy and raw materials.

In addition to our dependence

upon wood pulp, recycled white scrap paper and paperboard costs, our operating results depend on the availability and pricing of energy

and other raw materials.

An interruption in the supply of supplemental chemical agents could cause a material disruption at our mill.

In addition, an interruption in the supply of natural gas could cause a material disruption at our facilities.

our raw materials including natural gas are purchased from a number of suppliers, of which the three largest suppliers account for over

97% of all purchases.

If any of these contracts were to be terminated for any reason, or not renewed upon expiration, or if market conditions

were to substantially change creating a significant increase in the price of natural gas and recycled paper, we may not be able to find

alternative, comparable suppliers or suppliers capable of providing gas to us on terms or in amounts satisfactory to us.

replaced all the coal boilers with natural gas boiler in September 2017, but due to the gas consumption rise significantly, the government

will from time to time issue mandated restriction/suspension of natural gas supply for all natural gas consumption industries, including

the paper manufacturing industry in order to secure adequate natural gas to households uses in urban and rural areas.

We are subject

to the risks of natural gas supply restriction and above-mentioned factors.

As a result, our business, financial condition and operating

results could suffer.

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.

of our manufacturing facilities, or any of our machines within an otherwise operational facility, could cease operations unexpectedly

due to a number of events, including:

● maintenance

power failures;

equipment failure, including any malfunction of our waste water treatment facilities;

in the supply of raw materials, such as wood fiber, energy, or chemicals;

chemical spill or release;

because of environmental-related concerns;

effect of a drought or reduced rainfall on our water supply;

● disruptions

in the transportation infrastructure, including roads, bridges, railroad tracks, and tunnels;

floods, earthquakes, hurricanes, epidemic or other catastrophes;

or threats of terrorism;

difficulties;

operational problems.

any of the abovementioned events were to occur, we may be unable to meet customer demand, which may adversely affect our sales and net

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.

1988, the National Environmental Protection Bureau issued Interim Measures on the Administration of Water Pollutants Discharge Permits,

requiring all companies discharging pollution into the water as a direct or indirect byproduct of production to adhere to certain caps

on pollution discharge.

On January 24, 2021, the State Council issued Regulations on the Administration of Pollutant Discharge Permits,

which has effected on March 1, 2022.

Additionally, such companies were required to obtain and annually renew a Pollution Discharge Permit

in order to conduct their operations.

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 Law”), which became effective on June 5, 2022.

According to the Prevention and Control of Noise Pollution Law, entities

subject to the pollutant discharge licensing management requirements 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.

The noise pollution has

been included in the Pollution Discharge Permit, and we conduct quarterly test on the noise through qualified testing institutions to

comply with the laws, which is required by laws.

PRC government has the authority to shut down a company’s operations for its failure to maintain a valid permit.

We renewed our

Pollution Discharge Permit in June 2020.

At present, our raw materials

including natural gas are purchased from a number of suppliers, of which the three largest suppliers account for over 95% of all purchases.

If any of these contracts were to be terminated for any reason, or not renewed upon expiration, or if market conditions were to substantially

change creating a significant increase in the price of natural gas and recycled paper, we may not be able to find alternative, comparable

suppliers or suppliers capable of providing gas to us on terms or in amounts satisfactory to us.

We replaced all the coal

boilers with natural gas boiler in September 2017, but due to the gas consumption rise significantly, the government will from time to

time issue mandated restriction/suspension of natural gas supply for all natural gas consumption industries, including the paper manufacturing

industry in order to secure adequate natural gas to households uses in urban and rural areas.

We are subject to the risks of natural gas

supply restriction and above-mentioned factors.

As a result, our business, financial condition and operating results could suffer.

A 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.

Any of our manufacturing facilities, or any of

our machines within an otherwise operational facility, could cease operations unexpectedly due to a number of events, including:

● maintenance outages;

● prolonged power failures;

● an equipment failure, including any malfunction of our waste water treatment facilities;

● disruption in the supply of raw materials, such as wood fiber, energy, or chemicals;

● a chemical spill or release;

● closure because of environmental-related concerns;

● explosion of a boiler;

● the effect of a drought or reduced rainfall on our water supply;

● disruptions in the transportation infrastructure, including roads, bridges, railroad tracks, and tunnels;

● fires, floods, earthquakes, hurricanes, epidemic or other catastrophes;

● terrorism or threats of terrorism;

● labor difficulties;

● other operational problems.

If any of the abovementioned events were to occur,

we may be unable to meet customer demand, which may adversely affect our sales and net income.

Our 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.

In 1988, the National Environmental

Protection Bureau issued Interim Measures on the Administration of Water Pollutants Discharge Permits, requiring all companies discharging

pollution into the water as a direct or indirect byproduct of production to adhere to certain caps on pollution discharge.

24, 2021, the State Council issued Regulations on the Administration of Pollutant Discharge Permits, which has effected since March 1,

Additionally, such companies were required to obtain and annually renew a Pollution Discharge Permit in order to conduct their operations.

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 Law”), which became effective

on June 5, 2022.

According to the Prevention and Control of Noise Pollution Law, entities subject to the pollutant discharge licensing

management requirements 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.

The noise pollution has been included in the Pollution Discharge Permit,

and we conduct quarterly test on the noise through qualified testing institutions to comply with the laws, which is required by laws.

The PRC government has the

authority to shut down a company’s operations for its failure to maintain a valid permit.

We renewed our Pollution Discharge Permit

in June 2020.

Our latest permit is effective from June 28, 2020 through June 27, 2025.

Pollution discharge

Permit for Tengsheng Paper was effective from August 10, 2021 through August 9, 2026.

An application to renew will be filed by us with

the local environment protection agency before the expiration.

failure by us to obtain any certificate, permit, and license necessary for our operations or the failure by us to obtain the renewal

of any such certificate, permit or license may materially and adversely affect our business, prospects, financial condition and results

of operation.

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.

are required to comply with all Chinese national and local regulations regarding the protection of the environment.

Compliance with environmental

regulation is expensive.

The Chinese government is adopting even more stringent environmental protection and operational safety regulations

and the costs of complying with these regulations are expected to increase.

Although we have obtained all of the necessary approvals

and permits for our production facilities currently existing, we cannot assure you that we will be able to comply with all applicable

environmental protection and operational safety requirements, and obtain all of the required governmental approvals and permits that

may be or may become applicable to us on a timely basis, or at all, or will be able to complete all our registrations and filings with

the government, in time for our future projects.

The relevant governmental authorities may impose on us fines for any non-compliance,

set deadlines for rectification, and order us to cease construction or production if we fail to comply with their requirements.

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

order to remain competitive, from time to time we have to adjust the prices of our products to remain competitive.

We may not have available

sufficient financial or other resources to continue to make investments necessary to maintain our competitive position.

we fail to introduce enhancements to our existing products or to develop new products, our business and results of operations could be

adversely affected.

believe that our future success depends in part on our ability to enhance our existing products and develop new products in order to

continue to meet customer demand.

Our failure to introduce new or enhanced products on a timely and cost-competitive basis, or the development

of processes that make our existing products obsolete, could harm our business and results of operations.

have limited insurance coverage and may incur losses resulting from product liability claims or business interruptions.

the insurance industry in China is still in an early stage of development, insurance companies in China currently offer limited business

insurance products.

Pollution discharge Permit for Tengsheng Paper

was effective from August 10, 2021 through August 9, 2026.

An application to renew will be filed by us with the local environment protection

agency before the expiration.

The failure by us to maintain or obtain

any certificate, permit, and license necessary for our operations or the failure by us to obtain the renewal of any such certificate,

permit or license may materially and adversely affect our business, prospects, financial condition and results of operation.

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.

We are required to comply

with all Chinese national and local regulations regarding the protection of the environment.

Compliance with environmental regulation

is expensive.

The Chinese government is adopting even more stringent environmental protection and operational safety regulations and the

costs of complying with these regulations are expected to increase.

Although we have obtained all of the necessary approvals and permits

for our production facilities currently existing, we cannot assure you that we will be able to comply with all applicable environmental

protection and operational safety requirements, and obtain all of the required governmental approvals and permits that may be or may become

applicable to us on a timely basis, or at all, or will be able to complete all our registrations and filings with the government, in time

for our future projects.

The relevant governmental authorities may impose on us fines for any non-compliance, set deadlines for rectification,

and order us to cease construction or production if we fail to comply with their requirements.

If we are unable to respond to pricing pressures, our business

may be harmed.

In order to remain

competitive, from time to time we have to adjust the prices of our products to remain competitive.

We may not have available sufficient

financial or other resources to continue to make investments necessary to maintain our competitive position.

If we fail to introduce enhancements

to our existing products or to develop new products, our business and results of operations could be adversely affected.

We believe that

our future success depends in part on our ability to enhance our existing products and develop new products in order to continue to meet

customer demand.

Our failure to introduce new or enhanced products on a timely and cost-competitive basis, or the development of processes

that make our existing products obsolete, could harm our business and results of operations.

We have limited insurance coverage and may incur losses resulting

from product liability claims or business interruptions.

As the insurance industry

in China is still in an early stage of development, insurance companies in China currently offer limited business insurance products.

We do not have any product liability insurance or business interruption insurance.

Based on the insurance products

available in China, even if we decide to take out business interruption coverage, such insurance as currently available offers limited

coverage compared to that offered in many other jurisdictions.

Any business disruption, natural disaster, or product liability claim

could result in our incurring substantial costs and diversion of resources, which would have an adverse effect on our business and results

of operations.

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.

success and ability to compete depends in part on our intellectual property.

We primarily rely on a combination of trademark, trade secret,

and copyright laws, as well as confidentiality procedures and contractual restrictions with our employees, contractors and others to

establish and protect our intellectual property rights.

However, confidentiality and license arrangements may be breached by counterparties,

and there may not be adequate remedies available to us for any such breach.

Accordingly, we may not be able to effectively protect our

intellectual property rights or to enforce our contractual rights.

In addition, our trade secrets may be leaked or otherwise become available

to, or be independently discovered by, our competitors.

The steps we take to protect our intellectual property rights may be inadequate

or we may be unable to secure intellectual property protection for some of our properties.

Infringement of intellectual property rights

continues to pose a serious risk of doing business.

may in the future file, patent applications on certain of our innovations.

It is possible, however, that these innovations may not be

In addition, given the cost, effort and risks associated with patent application, we may choose not to seek patent protection

for some innovations.

Furthermore, our patent applications may not lead to granted patents, the scope of the protection gained may be

insufficient or an issued patent may be deemed invalid or unenforceable.

We also cannot guarantee that any of our present or future patents

or other intellectual property rights will not lapse or be invalidated, circumvented, challenged, or abandoned.

we are unable to protect our intellectual property, our competitors could use our intellectual property to market offerings similar to

ours and our ability to compete effectively would be impaired.

Moreover, others may independently develop technologies that are competitive

to ours or infringe on our intellectual property.

The enforcement of our intellectual property rights depends on our legal actions against

these infringers being successful, but we cannot be sure these actions will be successful, even when our rights have been infringed.

In addition, defending our intellectual property rights might entail significant expense and diversion of management resources.

our intellectual property rights may be challenged by others or invalidated through administrative processes or litigations.

We can provide

no assurance that we will prevail in such litigations, and, even if we do prevail, we may not obtain a meaningful relief.

despite our efforts, we may be unable to prevent external parties from infringing or misappropriating our intellectual property.

intellectual property that we own may not provide us with competitive advantages or may be successfully challenged by external parties.

may be subject to intellectual property infringement claims or other allegations, which may materially and adversely affect our business,

financial condition and prospects.

cannot be certain that we do not or will not infringe patents, copyrights, trademarks or other intellectual property rights held by external

From time to time, we may be subject to legal proceedings and claims alleging infringement of patents, trademarks, copyrights

or other intellectual property rights, or misappropriation of creative ideas or formats, or other infringement of proprietary, which

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

Based on the insurance products available in China,

even if we decide to take out business interruption coverage, such insurance as currently available offers limited coverage compared to

that offered in many other jurisdictions.

Any business disruption, natural disaster, or product liability claim could result in our incurring

substantial costs and diversion of resources, which would have an adverse effect on our business and results of 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 business.

Our success and ability

to compete depends in part on our intellectual property.

We primarily rely on a combination of trademark, trade secret, and copyright

laws, as well as confidentiality procedures and contractual restrictions with our employees, contractors and others to establish and protect

our intellectual property rights.

However, confidentiality and license arrangements may be breached by counterparties, and there may not

be adequate remedies available to us for any such breach.

Accordingly, we may not be able to effectively protect our intellectual property

rights or to enforce our contractual rights.

In addition, our trade secrets may be leaked or otherwise become available to, or be independently

discovered by, our competitors.

The steps we take to protect our intellectual property rights may be inadequate or we may be unable to

secure intellectual property protection for some of our properties.

Infringement of intellectual property rights continues to pose a serious

risk of doing business.

We may in the future file,

patent applications on certain of our innovations.

It is possible, however, that these innovations may not be patentable.

given the cost, effort and risks associated with patent application, we may choose not to seek patent protection for some innovations.

Furthermore, our patent applications may not lead to granted patents, the scope of the protection gained may be insufficient or an issued

patent may be deemed invalid or unenforceable.

We also cannot guarantee that any of our present or future patents or other intellectual

property rights will not lapse or be invalidated, circumvented, challenged, or abandoned.

If we are unable to protect

our intellectual property, our competitors could use our intellectual property to market offerings similar to ours and our ability to

compete effectively would be impaired.

Moreover, others may independently develop technologies that are competitive to ours or infringe

on our intellectual property.

The enforcement of our intellectual property rights depends on our legal actions against these infringers

being successful, but we cannot be sure these actions will be successful, even when our rights have been infringed.

In addition, defending

our intellectual property rights might entail significant expense and diversion of management resources.

Any of our intellectual property

rights may be challenged by others or invalidated through administrative processes or litigations.

We can provide no assurance that we

will prevail in such litigations, and, even if we do prevail, we may not obtain a meaningful relief.

Accordingly, despite our efforts,

we may be unable to prevent external parties from infringing or misappropriating our intellectual property.

Any intellectual property

that we own may not provide us with competitive advantages or may be successfully challenged by external parties.

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 cannot be certain that

we do not or will not infringe patents, copyrights, trademarks or other intellectual property rights held by external parties.

to time, we may be subject to legal proceedings and claims alleging infringement of patents, trademarks, copyrights or other intellectual

property rights, or misappropriation of creative ideas or formats, or other infringement of proprietary, which may materially and adversely

affect our business, financial condition and prospects.

Risks 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.

PRC government may intervene or influence our operations at any time, which could result in a material change in our operations and/or

the value of our common stock.

For example, the PRC government has recently published new policies that significantly affected certain

industries such as the education and internet industries, and we cannot rule out the possibility that it will in the future release regulations

or policies regarding any industry that could adversely affect the business, financial condition and results of operations of our company.

Furthermore, the PRC government has also recently indicated an intent to exert more oversight and control over securities offerings and

other capital markets activities that are conducted overseas and foreign investment in China-based companies.

Any such action, once taken

by the PRC government, could significantly limit or completely hinder our ability to offer or continue to offer securities to investors

and cause the value of such securities to significantly decline or in extreme cases, become worthless.

the PRC government initiated a series of regulatory actions and statements to regulate business operations in China with little advance

notice, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed

overseas using variable interest entity structure, adopting new measures to extend the scope of cyber security reviews, and expanding

the efforts in anti-monopoly enforcement.

Currently, these statements and regulatory actions have had no impact on our daily business

operation, the ability to accept foreign investments and list our securities on an U.S.

The 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.

The PRC government may intervene

or influence our operations at any time, which could result in a material change in our operations and/or the value of our common stock.

For example, the PRC government has recently published new policies that significantly affected certain industries such as the education

and internet industries, and we cannot rule out the possibility that it will in the future release regulations or policies regarding any

industry that could adversely affect the business, financial condition and results of operations of our company.

Furthermore, the PRC

government has also recently indicated an intent to exert more oversight and control over securities offerings and other capital markets

activities that are conducted overseas and foreign investment in China-based companies.

Any such action, once taken by the PRC government,

could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of

such securities to significantly decline or in extreme cases, become worthless.

Recently, the PRC government

initiated a series of regulatory actions and statements to regulate business operations in China with little advance notice, including

cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using variable

interest entity structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly

Currently, these statements and regulatory actions have had no impact on our daily business operation, the ability to accept

foreign investments and list our securities on an U.S.

or other foreign exchange.

Since these statements

and regulatory actions are new, it is highly uncertain how soon legislative or administrative regulation making bodies will respond and

what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any, and

the potential impact such modified or new laws and regulations will have on our daily business operation, the ability to accept foreign

investments and list our securities on an U.S.

Since these statements and regulatory actions are new,

it is highly uncertain how soon legislative or administrative regulation making bodies will respond and what existing or new laws or regulations

or detailed implementations and interpretations will be modified or promulgated, if any, and the potential impact such modified or new

laws and regulations will have on our daily business operation, the ability to accept foreign investments and list our securities on an

or other foreign exchange.

CSRC has released the Trial Measures for Administration of Overseas Securities Offerings and Listings by Domestic Companies (the “Trial

While such rules have not yet gone into effect, the Chinese government may exert more oversight and control over offerings

that are conducted overseas and foreign investment in China-based issuers, which could significantly limit or completely hinder our ability

to continue to offer our securities to investors and could cause the value of our securities to significantly decline or become worthless.

February 17, 2023, with the approval of the State Council, the CSRC released the Trial Measures and five supporting guidelines, which

will come into effect on March 31, 2023.

According to the Trial Measures, (1) domestic companies that seek to offer or list securities

overseas, both directly and indirectly, should fulfill the filing procedures and report relevant information to the CSRC;

if a domestic

company fails to complete the filing procedures or conceals any material fact or falsifies any major content in its filing documents,

such domestic company may be subject to administrative penalties by the CSRC,, such as order to rectify, warnings, fines, and its controlling

shareholders, actual controllers, the person directly in charge and other directly liable persons may also be subject to administrative

penalties, such as warnings and fines;

(2) if the issuer meets both of the following conditions, the overseas offerings and listings

shall be determined as an indirect overseas offerings and listings by a domestic company:

(i) 50% or more of the issuer’s operating

revenue, total profit, total assets or net assets as documented in its audited consolidated financial statements for the most recent

accounting year is accounted for by domestic enterprises;

(ii) its major operational activities are carried out in China or its

main places of business are located in China, or the senior managers in charge of its business operation and management are mostly Chinese

citizens or domiciled in China;

and (3) where a domestic company seeks to indirectly offer and list securities in an overseas market,

the issuer shall designate a major domestic operating entity responsible for all filing procedures with the CSRC, and where an issuer

makes an application for initial public offerings or listings in an overseas market, the issuer shall submit filings with the CSRC within

three business days after such application is submitted;

if the issuer submits the application documents for offerings or listings in

secret or non-public ways overseas, it may submit an explanation at the time of filing, and the application shall be postponed until

the application documents are reported to the CSRC within three business days after the application documents are disclosed overseas.

Trial Measures, when coming into effect on March 31, 2023, may subject us to additional compliance requirements in the future, and we

cannot assure you that we will be able to get the clearance of filing procedures under the Trial Measures on a timely basis, or at all.

Any failure of us to fully comply with new regulatory requirements may significantly limit or completely hinder our ability to continue

to offer our securities, cause significant disruption to our business operations, and severely damage our reputation, which would materially

and adversely affect our consolidated financial condition and results of operations and cause our securities to significantly decline

in value or become worthless.

We believe that we, our PRC Subsidiaries, the consolidated VIE and its subsidiary are not required to fulfill

filing procedures and obtain approvals from the CSRC to continue to offer our securities or operate the business of the consolidated

VIE and its subsidiary.

In addition, to date, none of us, our PRC Subsidiaries, consolidated VIE and its subsidiary have received any

filing or compliance requirements from CSRC for the listing of the Company at NYSE American and all of its overseas offerings.

on our understanding of the current PRC laws, we believe that the CSRC’s approval is not required to be obtained for ITP’s

listing on NYSE American;

however, there are substantial uncertainties regarding the interpretation and application of the M&A Rules,

other PRC Laws and future PRC laws and regulations, and there can be no assurance that any PRC governmental agency will not take a view

that is contrary to or otherwise different from our belief stated herein.

greater oversight by the Cyberspace Administration of China, or the “CAC,” over data security, particularly for companies

seeking to list on a foreign exchange, could adversely impact the business of us, the consolidated VIE and its subsidiary and investing

in our securities.

December 28, 2021, the CAC, together with 12 other governmental departments of the PRC, jointly promulgated the Cybersecurity Review

Measures, which became effective on February 15, 2022.

The Cybersecurity Review Measures provides that, in addition to critical information

infrastructure operators (“CIIOs”) that intend to purchase Internet products and services, data processing operators engaging

in data processing activities that affect or may affect national security must be subject to cybersecurity review by the Cybersecurity

Review Office of the PRC.

According to the Cybersecurity Review Measures, a cybersecurity review assesses potential national security

risks that may be brought about by any procurement, data processing, or overseas listing.

The Cybersecurity Review Measures further requires

that CIIOs and data processing operators that possess personal data of at least one million users must apply for a review by the Cybersecurity

Review Office of the PRC before conducting listings in foreign countries.

November 14, 2021, the CAC published the Draft Regulations on the Network Data Security Administration (Draft for Comments) (the “Security

Administration Draft”), which provides that data processing operators engaging in data processing activities that affect or may

affect national security must be subject to network data security review by the relevant Cyberspace Administration of the PRC.

to the Security Administration Draft, data processing operators who possess personal data of at least one million users or collect data

that affects or may affect national security must be subject to network data security review by the relevant Cyberspace Administration

The deadline for public comments on the Security Administration Draft was December 13, 2021.

Security Assessment Measures for Outbound Data Transfers which was released on May 19, 2022 at the 10th executive meeting of the Cybersecurity

Administration of China in 2022, and implemented on September 1, 2022, stipulates that a data processor shall declare security assessment

for its outbound data transfer to the CAC at the provincial level:

The CSRC has released the Trial Measures

for Administration of Overseas Securities Offerings and Listings by Domestic Companies (the “Trial Measures”).

rules have not yet gone into effect, the Chinese government may exert more oversight and control over offerings that are conducted overseas

and foreign investment in China-based issuers, which could significantly limit or completely hinder our ability to continue to offer our

securities to investors and could cause the value of our securities to significantly decline or become worthless.

On February 17, 2023, with

the approval of the State Council, the CSRC released the Trial Measures and five supporting guidelines, which will come into effect on

March 31, 2023.

According to the Trial Measures, (1) domestic companies that seek to offer or list securities overseas, both directly

and indirectly, should fulfill the filing procedures and report relevant information to the CSRC;

if a domestic company fails to complete

the filing procedures or conceals any material fact or falsifies any major content in its filing documents, such domestic company may

be subject to administrative penalties by the CSRC,, such as order to rectify, warnings, fines, and its controlling shareholders, actual

controllers, the person directly in charge and other directly liable persons may also be subject to administrative penalties, such as

warnings and fines;

(2) if the issuer meets both of the following conditions, the overseas offerings and listings shall be determined

as an indirect overseas offerings and listings by a domestic company:

(i) 50% or more of the issuer’s operating revenue, total profit,

total assets or net assets as documented in its audited consolidated financial statements for the most recent accounting year is accounted

for by domestic enterprises;

(ii) its major operational activities are carried out in China or its main places of business are located

in China, or the senior managers in charge of its business operation and management are mostly Chinese citizens or domiciled in China;

and (3) where a domestic company seeks to indirectly offer and list securities in an overseas market, the issuer shall designate a major

domestic operating entity responsible for all filing procedures with the CSRC, and where an issuer makes an application for initial public

offerings or listings in an overseas market, the issuer shall submit filings with the CSRC within three business days after such application

is submitted;

if the issuer submits the application documents for offerings or listings in secret or non-public ways overseas, it may

submit an explanation at the time of filing, and the application shall be postponed until the application documents are reported to the

CSRC within three business days after the application documents are disclosed overseas.

The Trial Measures, when

coming into effect on March 31, 2023, may subject us to additional compliance requirements in the future, and we cannot assure you that

we will be able to get the clearance of filing procedures under the Trial Measures on a timely basis, or at all.

Any failure of us to

fully comply with new regulatory requirements may significantly limit or completely hinder our ability to continue to offer our securities,

cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely affect

our consolidated financial condition and results of operations and cause our securities to significantly decline in value or become worthless.

We believe that we, our PRC Subsidiaries, the consolidated VIE and its subsidiary are not required to fulfill filing procedures and obtain

approvals from the CSRC to continue to offer our securities or operate the business of the consolidated VIE and its subsidiary.

to date, none of us, our PRC Subsidiaries, consolidated VIE and its subsidiary have received any filing or compliance requirements from

CSRC for the listing of the Company at NYSE American and all of its overseas offerings.

Based on our understanding of the current PRC

laws, we believe that the CSRC’s approval is not required to be obtained for ITP’s continued listing on NYSE American;

there are substantial uncertainties regarding the interpretation and application of the M&A Rules, other PRC Laws and future PRC laws

and regulations, and there can be no assurance that any PRC governmental agency will not take a view that is contrary to or otherwise

different from our belief stated herein.

Recent greater oversight by the

Cyberspace Administration of China, or the “CAC,” over data security, particularly for companies seeking to list on a foreign

exchange, could adversely impact the business of us, the consolidated VIE and its subsidiary and investing in our securities.

On December 28, 2021, the

CAC, together with 12 other governmental departments of the PRC, jointly promulgated the Cybersecurity Review Measures, which became effective

on February 15, 2022.

The Cybersecurity Review Measures provides that, in addition to critical information infrastructure operators (“CIIOs”)

that intend to purchase Internet products and services, data processing operators engaging in data processing activities that affect or

may affect national security must be subject to cybersecurity review by the Cybersecurity Review Office of the PRC.

According to the Cybersecurity

Review Measures, a cybersecurity review assesses potential national security risks that may be brought about by any procurement, data

processing, or overseas listing.

The Cybersecurity Review Measures further requires that CIIOs and data processing operators that possess

personal data of at least one million users must apply for a review by the Cybersecurity Review Office of the PRC before conducting listings

in foreign countries.

On November 14, 2021, the

CAC published the Draft Regulations on the Network Data Security Administration (Draft for Comments) (the “Security Administration

Draft”), which provides that data processing operators engaging in data processing activities that affect or may affect national

security must be subject to network data security review by the relevant Cyberspace Administration of the PRC.

According to the Security

Administration Draft, data processing operators who possess personal data of at least one million users or collect data that affects or

may affect national security must be subject to network data security review by the relevant Cyberspace Administration of the PRC.

deadline for public comments on the Security Administration Draft was December 13, 2021.

The Security Assessment

Measures for Outbound Data Transfers which was released on May 19, 2022 at the 10th executive meeting of the Cybersecurity Administration

of China in 2022, and implemented on September 1, 2022, stipulates that a data processor shall declare security assessment for its outbound

data transfer to the CAC at the provincial level:

(i) where a data processor provides critical data abroad;

a CIIO or a data processor processing the personal information of more than one million people provides personal information abroad;

(iii) where a data processor has provided personal information of 100,000 people or sensitive personal information of 10,000 people in

total abroad since January 1 of the previous year;

and (iv) other circumstances prescribed by the CAC for which declaration for security

assessment for outbound data transfers is required.

believe none of us, our PRC Subsidiaries, the consolidated VIE or its subsidiaries is a CIIO, and we believe that we, all of our PRC

Subsidiaries, the consolidated VIE and its subsidiary are not required to go through cybersecurity review from the CAC to continue to

offer our securities or operate the business of the consolidated VIE and its subsidiary.

In addition, as of the date of this annual report,

we, our PRC Subsidiaries, consolidated VIE and its subsidiary have not received any notice from any authorities identifying us as a CIIO

or requiring us to go through cybersecurity review or network data security review by the CAC.

We, our PRC Subsidiaries, consolidated

VIE and its subsidiary have not been required to obtain any approvals or permits from CAC.

When the Cybersecurity Review Measures become

effective and if the Security Administration Draft is enacted as proposed, we believe that the operations of the consolidated VIE and

its subsidiary and our listing will not be affected and that we, the consolidated VIE and its subsidiary will not be subject to cybersecurity

review or network data security review by the CAC, given that:

(i) as a company that mainly engages in paper production and distribution,

our PRC Subsidiaries, the consolidated VIE and VIE’s subsidiaries are unlikely to be classified as CIIOs by the PRC regulatory

(ii) we, the consolidated VIE and its subsidiary possess personal data of fewer than one million individual clients in the

business operations as of the date of this annual report and do not anticipate that we, the consolidated VIE and its subsidiary will

be collecting over one million users’ personal information in the near future, which we understand might otherwise subject us,

the consolidated VIE and its subsidiary to the Cybersecurity Review Measures;

and (iii) data processed in the business of the consolidated

VIE and its subsidiary is unlikely to have a bearing on national security and therefore is unlikely to be classified as core or important

data by the authorities.

There remains uncertainty, however, as to how the Cybersecurity Review Measures and the Security Administration

Draft will be interpreted or implemented and whether the PRC regulatory agencies, including the CAC, may adopt new laws, regulations,

rules, or detailed implementation and interpretation related to the Cybersecurity Review Measures and the Security Administration Draft.

If any such new laws, regulations, rules, or implementation and interpretation come into effect, we will take all reasonable measures

and actions to comply and to minimize the adverse effect of such laws on us.

We cannot guarantee, however, that we, the consolidated

VIE and its subsidiary will not be subject to cybersecurity review and network data security review in the future.

During such reviews,

we, the consolidated VIE and its subsidiary may be required to suspend our operation or experience other disruptions to our operations.

Cybersecurity review and network data security review could also result in negative publicity with respect to our Company and diversion

of our managerial and financial resources, which could materially and adversely affect the business, financial conditions, and results

of operations of us, the consolidated VIE and its subsidiary.

business may be subject to a variety of PRC laws and other obligations regarding cyber security and data protection.

business may be subject to PRC laws relating to the collection, use, sharing, retention, security, and transfer of confidential and private

information, such as personal information and other data.

These laws continue to develop, and the PRC government may adopt other rules

and restrictions in the future.

(ii) where a CIIO or a data

processor processing the personal information of more than one million people provides personal information abroad;

(iii) where a data

processor has provided personal information of 100,000 people or sensitive personal information of 10,000 people in total abroad since

January 1 of the previous year;

and (iv) other circumstances prescribed by the CAC for which declaration for security assessment for outbound

data transfers is required.

We believe none of us, our

PRC Subsidiaries, the consolidated VIE or its subsidiaries is a CIIO, and we believe that, to date, we, all of our PRC Subsidiaries, the

consolidated VIE and its subsidiary are not required to go through cybersecurity review from the CAC to continue to offer our securities

or operate the business of the consolidated VIE and its subsidiary.

In addition, as of the date of this annual report, we, our PRC Subsidiaries,

consolidated VIE and its subsidiary have not received any notice from any authorities identifying us as a CIIO or requiring us to go through

cybersecurity review or network data security review by the CAC.

We, our PRC Subsidiaries, consolidated VIE and its subsidiary have not

been required to obtain any approvals or permits from CAC.

When the Cybersecurity Review Measures become effective and if the Security

Administration Draft is enacted as proposed, we believe that the operations of the consolidated VIE and its subsidiary and our listing

will not be affected and that we, the consolidated VIE and its subsidiary will not be subject to cybersecurity review or network data

security review by the CAC, given that:

(i) as a company that mainly engages in paper production and distribution, our PRC Subsidiaries,

the consolidated VIE and VIE’s subsidiaries are unlikely to be classified as CIIOs by the PRC regulatory agencies;

consolidated VIE and its subsidiary possess personal data of fewer than one million individual clients in the business operations as of

the date of this annual report and do not anticipate that we, the consolidated VIE and its subsidiary will be collecting over one million

users’ personal information in the near future, which we understand might otherwise subject us, the consolidated VIE and its subsidiary

to the Cybersecurity Review Measures;

and (iii) data processed in the business of the consolidated VIE and its subsidiary is unlikely

to have a bearing on national security and therefore is unlikely to be classified as core or important data by the authorities.

remains uncertainty, however, as to how the Cybersecurity Review Measures and the Security Administration Draft will be interpreted or

implemented and whether the PRC regulatory agencies, including the CAC, may adopt new laws, regulations, rules, or detailed implementation

and interpretation related to the Cybersecurity Review Measures and the Security Administration Draft.

If any such new laws, regulations,

rules, or implementation and interpretation come into effect, we will take all reasonable measures and actions to comply and to minimize

the adverse effect of such laws on us.

We cannot guarantee, however, that we, the consolidated VIE and its subsidiary will not be subject

to cybersecurity review and network data security review in the future.

During such reviews, we, the consolidated VIE and its subsidiary

may be required to suspend our operation or experience other disruptions to our operations.

Cybersecurity review and network data security

review could also result in negative publicity with respect to our Company and diversion of our managerial and financial resources, which

could materially and adversely affect the business, financial conditions, and results of operations of us, the consolidated VIE and its

The occurrence of security

breaches and cyber-attacks could negatively impact our business.

Information technology systems

are important to our business and operations.

We are subject to attempts to compromise our security and information systems, including

denial of service attacks, viruses, malicious software or ransomware, and exploitations of system flaws or weaknesses.

Error or malfeasance

or other irregularities may also result in the failure of our or our third-party service providers’ cybersecurity measures and may give

rise to a cybersecurity incident.

The techniques used to conduct security breaches and cyber-attacks, as well as the sources and targets

of these attacks, change frequently and may not be recognized until launched against us or our third-party service providers.

third-party service providers may not have the resources or technical sophistication to anticipate or prevent rapidly evolving types of

cyber-attacks.

The primary risks that could directly result from the occurrence of security breaches and cyber-attacks include operational

interruption, financial losses, personal information leakage and non-compliance.

The occurrence of such incidents could negatively impact

our business operations and our relationships with customers and employees, and damage our reputation.

If we or our third-party service

providers are unable to avert security breaches and cyber-attacks, we could incur significantly higher costs, including remediation costs

to repair damage caused by the breach, costs to deploy additional personnel and network protection technologies, train employees and engage

third-party experts and consultants, as well as litigation costs resulting from the incident.

These costs, which could be material, could

adversely impact our results of operations in the period in which they are incurred and may not meaningfully limit the success of future

attempts to breach our information technology systems.

Our business may be subject to a variety of PRC laws and other

obligations regarding cybersecurity and data protection.

We receive and maintain

certain personal, financial and other information about our customers in various information systems that we maintain and in those maintained

by third-party service providers.

Our information technology systems, such as those we use for administrative functions, including human

resources, payroll, accounting and internal and external communications, can contain personal, financial or other information of our employees.

We also maintain important proprietary and other confidential information related to our operations.

As a result, we face risks inherent

in handling and protecting information.

If our security and information

systems or the security and information systems of third-party service providers are compromised for any reason, including as a result

of data corruption or loss, security breach, cyber-attack or other external or internal methods, or if our employees, or service providers

fail to comply with laws, regulations and practice standards, and this information is obtained by unauthorized persons, used or disclosed

inappropriately or destroyed, it could subject us to litigation and government enforcement actions, cause us to incur substantial costs,

liabilities and penalties and/or result in a loss of customer confidence, any and all of which could adversely affect our business, reputation,

ability to attract new customers, results of operations and financial condition.

In addition, our business

may be subject to PRC laws relating to the collection, use, sharing, retention, security, and transfer of confidential and private information,

such as personal information and other data.

These laws continue to develop, and the PRC government may adopt other rules and restrictions

in the future.

Non-compliance could result in penalties or other significant legal liabilities.

to the PRC Cyber security Law, which was promulgated by the Standing Committee of the National People’s Congress on November 7,

2016 and took effect on June 1, 2017, personal information and important data collected and generated by a critical information infrastructure

operator in the course of its operations in China must be stored in China, and if a critical information infrastructure operator purchases

internet products and services that affects or may affect national security, it should be subject to cyber security review by the Cyberspace

Administration of China (“CAC”).

Due to the lack of further interpretations, the exact scope of “critical information

infrastructure operator” remains unclear.

April 13, 2020, twelve Chinese government agencies jointly promulgated the Measures for Cyber security Review (2020 version) (“Old

Measures”), which became effective on June 1, 2020, set forth the cyber security review mechanism for critical information infrastructure

operators, and provided that critical information infrastructure operators (“CIIOs”) who intend to procure network products

and services that affect or may affect national security shall be subject to a cyber security review.

On June 10, 2021, the Standing

Committee of the National People’s Congress promulgated the PRC Data Security Law, which took effect in September 2021.

Security Law provides for a security review procedure for the data activities that may affect national security.

Moreover, the CAC issued

the Measures of Cyber security Review (Revised Draft for Comments) on July 10, 2021, which requires operators with personal information

of more than one million users who want to list abroad to file a cyber security review with the CAC.

Furthermore, the General Office

of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the Opinions on Severe

and Lawful Crackdown on Illegal Securities Activities, which was available to the public on July 6, 2021.

These opinions emphasized the

need to strengthen the administration over illegal securities activities and the supervision on overseas listings by China-based companies.

These opinions proposed to take effective measures, such as promoting the construction of relevant regulatory systems, to deal with the

risks and incidents facing China-based overseas-listed companies and the demand for cyber security and data privacy protection.

Data Security Law also sets forth the data security protection obligations for entities and individuals handling personal data, including

that no entity or individual may acquire such data by stealing or other illegal means, and the collection and use of such data should

not exceed the necessary limits The costs of compliance with, and other burdens imposed by, PRC Cyber security Law and any other cyber

security and related laws may limit the use and adoption of our products and services and could have an adverse impact on our business.

Further, if the enacted version of the Measures for Cyber security Review mandates clearance of cyber security review and other specific

actions to be completed by companies like us, we face uncertainties as to whether such clearance can be timely obtained, or at all.

January 4, 2022, the CAC issued the revised Measures on Cyberspace Security Review (the “Revised Measures”)that has came

into effect on February 15, 2022, which required that, among others, in addition to “operator of critical information infrastructure,”

any “network platform operator data processor” 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 review.

We do not believe we are among the “operator

of critical information infrastructure” or “network platform operator data processor” who control over one million

personal information as mentioned above;

Pursuant to the PRC Cybersecurity

Law, which was promulgated by the Standing Committee of the National People’s Congress on November 7, 2016 and took effect on June

1, 2017, personal information and important data collected and generated by a critical information infrastructure operator in the course

of its operations in China must be stored in China, and if a critical information infrastructure operator purchases internet products

and services that affects or may affect national security, it should be subject to cybersecurity review by the Cyberspace Administration

of China (“CAC”).

Due to the lack of further interpretations, the exact scope of “critical information infrastructure

operator” remains unclear.

On April 13, 2020, twelve

Chinese government agencies jointly promulgated the Measures for Cybersecurity Review (2020 version) (“Old Measures”), which

became effective on June 1, 2020, set forth the cybersecurity review mechanism for critical information infrastructure operators, and

provided that critical information infrastructure operators (“CIIOs”) who intend to procure network products and services

that affect or may affect national security shall be subject to a cybersecurity review.

On June 10, 2021, the Standing Committee of the

National People’s Congress promulgated the PRC Data Security Law, which took effect in September 2021.

The Data Security Law provides

for a security review procedure for the data activities that may affect national security.

Moreover, the CAC issued the Measures of Cybersecurity

Review (Revised Draft for Comments) on July 10, 2021, which requires operators with personal information of more than one million users

who want to list abroad to file a cybersecurity review with the CAC.

Furthermore, the General Office of the Central Committee of the Communist

Party of China and the General Office of the State Council jointly issued the Opinions on Severe and Lawful Crackdown on Illegal Securities

Activities, which was available to the public on July 6, 2021.

These opinions emphasized the need to strengthen the administration over

illegal securities activities and the supervision on overseas listings by China-based companies.

These opinions proposed to take effective

measures, such as promoting the construction of relevant regulatory systems, to deal with the risks and incidents facing China-based overseas-listed

companies and the demand for cybersecurity and data privacy protection.

The Data Security Law also

sets forth the data security protection obligations for entities and individuals handling personal data, including that no entity or individual

may acquire such data by stealing or other illegal means, and the collection and use of such data should not exceed the necessary limits

The costs of compliance with, and other burdens imposed by, PRC Cybersecurity Law and any other cybersecurity and related laws may limit

the use and adoption of our products and services and could have an adverse impact on our business.

Further, if the enacted version of

the Measures for Cybersecurity Review mandates clearance of cybersecurity review and other specific actions to be completed by companies

like us, we face uncertainties as to whether such clearance can be timely obtained, or at all.

On January 4, 2022, the

CAC issued the revised Measures on Cyberspace Security Review (the “Revised Measures”) that has come into effect on February

15, 2022, which required that, among others, in addition to “operator of critical information infrastructure,” any “network

platform operator data processor” controlling personal information of no less than one million users which seeks to list in a foreign

stock exchange should also be subject to cybersecurity review.

We do not believe we are among the “operator of critical information

infrastructure” or “network platform operator data processor” who control over one million personal information as mentioned

however, the definition of “network platform operator” is unclear.

The revised draft

of the Measures for Cyber security Review is in the process of being formulated and it is also unclear on how it will be interpreted,

amended and implemented by the relevant PRC governmental authorities.

The Revised Measures also establish a Cyber security Review Office

(the “CRO”), an administrative body within the CAC, to formulate the regulations for cyber security review and to lead the

cyber security review process.

Applicable CIIOs and NP operators are required to submit an application to the CRO, and the CRO will assess

whether a cyber security review is required.

these laws, opinions and the measures were recently issued, official guidance and interpretation of these remain unclear in several respects

at this time, and the PRC government authorities may have wide discretion in the interpretation and enforcement of these laws, opinions

and the measures.

The revised draft of the Measures for Cybersecurity

Review is in the process of being formulated and it is also unclear on how it will be interpreted, amended and implemented by the relevant

PRC governmental authorities.

The Revised Measures also establish a Cybersecurity Review Office (the “CRO”), an administrative

body within the CAC, to formulate the regulations for cybersecurity review and to lead the cybersecurity review process.

Applicable CIIOs

and NP operators are required to submit an application to the CRO, and the CRO will assess whether a cybersecurity review is required.

As these laws, opinions

and the measures were recently issued, official guidance and interpretation of these remain unclear in several respects at this time,

and the PRC government authorities may have wide discretion in the interpretation and enforcement of these laws, opinions and the measures.

Therefore, it is uncertain whether the future regulatory changes would impose additional restrictions on our business.

believe that we are currently not be subject to the cyber security review by the CAC, given the factors discussed above.

However, there

remains uncertainty as to how the Revised Measures will be interpreted or implemented and whether the PRC regulatory agencies, including

the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Revised Measures.

such new laws, regulations, rules, or implementation and interpretation come into effect, we will take all reasonable measures and actions

to comply and to minimize the adverse effect of such laws on us.

cannot assure you that PRC regulatory agencies, including the CAC, would take the same view as we do.

In the event that we are subject

to any mandatory cyber security review and other specific actions required by the CAC, we face uncertainty as to whether any clearance

or other required actions can be timely completed, or at all.

Given such uncertainty, we may be further required to suspend our relevant

business, or face other penalties, which could materially and adversely affect our business, financial condition, and results of operations.

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.

business operations, financial condition, results of operations and prospects may be adversely affected by the current and future political

environment in the PRC.

The PRC has operated as a socialist state since the middle of the 20th century and is controlled by the Communist

Party of China.

The Chinese government exerts substantial influence and control over the manner in which we must conduct our business

The PRC has only permitted provincial and local economic autonomy and private economic activities since 1978.

The government

of the PRC has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy, including

the paper industry, through regulation and state ownership.

Our ability to operate in the PRC may be adversely affected by changes in

Chinese laws and regulations, including those relating to taxation, import and export tariffs, raw materials, environmental regulations,

land use rights, property and other matters.

Under its current leadership, the government of the PRC has been pursuing economic reform

policies that encourage private economic activity and greater economic decentralization.

There is no assurance, however, that the government

of the PRC will continue to pursue these policies, or that it will not significantly alter these policies from time to time without notice.

of the PRC government can have significant effects on the economic conditions of the PRC.

The PRC government has confirmed that economic

development will follow the model of a market economy.

Under this direction, we believe that the PRC will continue to strengthen its

economic and trading relationships with foreign countries and business development in the PRC will follow market forces.

While we believe

that this trend will continue, there can be no assurance that this will be the case.

change in policies by the PRC government could adversely affect our interests by, among other factors:

changes in laws, regulations or

the interpretation thereof, confiscatory taxation, restrictions on currency conversion, imports or sources of supplies, or the expropriation

or nationalization of private enterprises.

Although the PRC government has been pursuing economic reform policies for more than three

decades, there is no assurance that the government will continue to pursue such policies or that such policies may not be significantly

altered, especially in the event of a change in leadership, social or political disruption, or other circumstances affecting the PRC’s

political, economic and social life.

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

Any changes in such PRC laws and

regulations may harm our business.

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

The PRC’s legal system is

a civil law system based on written statutes, in which system decided legal cases have little value as precedents unlike the common law

system prevalent in the United States.

There are substantial uncertainties regarding the interpretation and application of PRC laws and

regulations, including but not limited to the laws and regulations governing our business, the enforcement and performance of our contractual

arrangements with our VIE, Dongfang Paper, and its shareholders, or the enforcement and performance of our arrangements with customers

in the event of the imposition of statutory liens, death, bankruptcy and criminal proceedings.

The Chinese government has been developing

a comprehensive system of commercial laws, and considerable progress has been made in introducing laws and regulations dealing with economic

matters such as foreign investment, corporate organization and governance, commerce, taxation and trade.

However, because these laws

and regulations are relatively new, and because of the limited volume of published cases and judicial interpretation and their lack of

force as precedents, interpretation and enforcement of these laws and regulations involve significant uncertainties.

New laws and regulations

that affect existing and proposed future businesses may also be applied retroactively.

Our major operating entity, Dongfang Paper, conducts

its operations in China, and as a result, we are required to comply with PRC laws and regulations.

We cannot assure you that our current

ownership and operating structure would not be found in violation of any current or future PRC laws or regulations.

Any of these or similar

actions could significantly disrupt our business operations or restrict us from conducting a substantial portion of our business operations,

We believe that we are currently

not be subject to the cybersecurity review by the CAC, given the factors discussed above.

However, there remains uncertainty as to how

the Revised Measures will be interpreted or implemented and whether the PRC regulatory agencies, including the CAC, may adopt new laws,

regulations, rules, or detailed implementation and interpretation related to the Revised Measures.

If any such new laws, regulations,

rules, or implementation and interpretation come into effect, we will take all reasonable measures and actions to comply and to minimize

the adverse effect of such laws on us.

We cannot assure you that

PRC regulatory agencies, including the CAC, would take the same view as we do.

In the event that we are subject to any mandatory cybersecurity

review and other specific actions required by the CAC, we face uncertainty as to whether any clearance or other required actions can be

timely completed, or at all.

Given such uncertainty, we may be further required to suspend our relevant business, or face other penalties,

which could materially and adversely affect our business, financial condition, and results of operations.

We cannot predict what effect

the interpretation of existing or new PRC laws or regulations may have on our business.

If the relevant authorities find that we are

in violation of PRC laws or regulations, they would have broad discretion in dealing with such a violation, including, without limitation:

Dongfang Paper’s business and other licenses;

that we restructure our ownership or operations;

that we discontinue any portion or all of our business.

the material laws that we are subject to are the Price Law of The People’s Republic of China, Measurement Law of The People’s

Republic of China, Tax Law, Environmental Protection Law, Contract Law, Patent Law, Accounting Laws and Labor Law.

slowdown, inflation or other adverse developments in the PRC economy may harm our customers and the demand for our services and products.

of our operations are conducted in the PRC and all of our revenue is generated from sales in the PRC.

Although the PRC economy has grown

significantly in recent years, we cannot assure you that this growth will continue.

In 2022, China’s Gross Domestic Product (“GDP”)

growth rate was 3.0% as compared to 8.1% in 2021.

A slowdown in overall economic growth, an economic downturn, a recession or other adverse

economic developments in the PRC could significantly reduce the demand for our products and harm our business.

Additionally,

while the PRC economy experienced rapid growth, such growth has been uneven among various sectors of the economy and in different geographical

areas of the country.

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.

Our business operations,

financial condition, results of operations and prospects may be adversely affected by the current and future political environment in

The PRC has operated as a socialist state since the middle of the 20th century and is controlled by the Communist Party of China.

The Chinese government exerts substantial influence and control over the manner in which we must conduct our business activities.

PRC has only permitted provincial and local economic autonomy and private economic activities since 1978.

The government of the PRC has

exercised and continues to exercise substantial control over virtually every sector of the Chinese economy, including the paper industry,

through regulation and state ownership.

Our ability to operate in the PRC may be adversely affected by changes in Chinese laws and regulations,

including those relating to taxation, import and export tariffs, raw materials, environmental regulations, land use rights, property and

other matters.

Under its current leadership, the government of the PRC has been pursuing economic reform policies that encourage private

economic activity and greater economic decentralization.

There is no assurance, however, that the government of the PRC will continue

to pursue these policies, or that it will not significantly alter these policies from time to time without notice.

Policies of the PRC government

can have significant effects on the economic conditions of the PRC.

The PRC government has confirmed that economic development will follow

the model of a market economy.

Under this direction, we believe that the PRC will continue to strengthen its economic and trading relationships

with foreign countries and business development in the PRC will follow market forces.

While we believe that this trend will continue,

there can be no assurance that this will be the case.

A change in policies by

the PRC government could adversely affect our interests by, among other factors:

changes in laws, regulations or the interpretation thereof,

confiscatory taxation, restrictions on currency conversion, imports or sources of supplies, or the expropriation or nationalization of

private enterprises.

Although the PRC government has been pursuing economic reform policies for more than three decades, there is no assurance

that the government will continue to pursue such policies or that such policies may not be significantly altered, especially in the event

of a change in leadership, social or political disruption, or other circumstances affecting the PRC’s political, economic and social

The PRC laws and regulations governing our

current business operations are sometimes vague and uncertain.

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

The PRC laws and regulations

governing our current business operations are sometimes vague and uncertain.

The PRC’s legal system is a civil law system based

on written statutes, in which system decided legal cases have little value as precedents unlike the common law system prevalent in the

United States.

There are substantial uncertainties regarding the interpretation and application of PRC laws and regulations, including

but not limited to the laws and regulations governing our business, the enforcement and performance of our contractual arrangements with

our VIE, Dongfang Paper, and its shareholders, or the enforcement and performance of our arrangements with customers in the event of the

imposition of statutory liens, death, bankruptcy and criminal proceedings.

The Chinese government has been developing a comprehensive

system of commercial laws, and considerable progress has been made in introducing laws and regulations dealing with economic matters such

as foreign investment, corporate organization and governance, commerce, taxation and trade.

However, because these laws and regulations

are relatively new, and because of the limited volume of published cases and judicial interpretation and their lack of force as precedents,

interpretation and enforcement of these laws and regulations involve significant uncertainties.

New laws and regulations that affect existing

and proposed future businesses may also be applied retroactively.

Our major operating entity, Dongfang Paper, conducts its operations

in China, and as a result, we are required to comply with PRC laws and regulations.

We cannot assure you that our current ownership and

operating structure would not be found in violation of any current or future PRC laws or regulations.

Any of these or similar actions

could significantly disrupt our business operations or restrict us from conducting a substantial portion of our business operations, which

could materially and adversely affect our business, financial condition and results of operations.

We cannot predict what effect the interpretation

of existing or new PRC laws or regulations may have on our business.

If the relevant authorities find that we are in violation of PRC

laws or regulations, they would have broad discretion in dealing with such a violation, including, without limitation:

● levying fines;

● revoking Dongfang Paper’s business and other licenses;

● requiring that we restructure our ownership or operations;

● requiring that we discontinue any portion or all of our business.

Among the material laws that we are subject to

are the Price Law of The People’s Republic of China, Measurement Law of The People’s Republic of China, Tax Law, Environmental

Protection Law, Contract Law, Patent Law, Accounting Laws and Labor Law.

A slowdown, inflation or other adverse developments in the PRC

economy may harm our customers and the demand for our services and products.

All of our operations are

conducted in the PRC and all of our revenue is generated from sales in the PRC.

Although the PRC economy has grown significantly in recent

years, we cannot assure you that this growth will continue.

In 2023, China’s Gross Domestic Product (“GDP”) growth rate

was 5.2% as compared to 3.0% in 2022.

A slowdown in overall economic growth, an economic downturn, a recession or other adverse economic

developments in the PRC could significantly reduce the demand for our products and harm our business.

Additionally, while the

PRC economy experienced rapid growth, such growth has been uneven among various sectors of the economy and in different geographical areas

of the country.

Rapid economic growth could lead to growth in the money supply and rising inflation.

If prices for our products

rise at a rate that is insufficient to compensate for the rise in the costs of supplies, it may harm our profitability.

In order to control

inflation in the past, the PRC government has imposed controls on bank credit, limits on loans for fixed assets and restrictions on state

bank lending.

If prices for our products rise at

a rate that is insufficient to compensate for the rise in the costs of supplies, it may harm our profitability.

In order to control inflation

in the past, the PRC government has imposed controls on bank credit, limits on loans for fixed assets and restrictions on state bank lending.

Such an austere policy can lead to a slowing of economic growth.

PRC Subsidiaries, consolidated VIE and its subsidiary in China are subject to restrictions on making dividends and other payments to

us or any other affiliated company.

are a holding company and may receive dividends paid by our subsidiaries established in China for our cash needs, including the funds

necessary to pay dividends and other cash distributions to our shareholders to the extent we choose to do so, to service any debt we

may incur and to pay our operating expenses.

Baoding Shengde’s income in turn depends on the service and other fees paid by the

consolidated VIE.

In addition, ITP, its subsidiaries, the consolidated VIE and the VIE’s subsidiaries may also transfer cash to

each other as part of the group cash management.

If any of our subsidiaries, the consolidated VIE and VIE’s subsidiaries incurs

debt on its own behalf in the future, the instruments governing such debt may restrict their ability to pay dividends or make other payments

Current PRC regulations permit our PRC Subsidiaries to pay dividends to us only out of their accumulated profits, if any, determined

in accordance with Chinese accounting standards and regulations.

In addition, under the applicable requirements of PRC law, our PRC Subsidiaries,

consolidated VIE and its subsidiary incorporated as companies may only distribute dividends after they have made allowances to fund certain

statutory reserves.

Our PRC Subsidiaries, consolidated VIE and

its subsidiary in China are subject to restrictions on making dividends and other payments to us or any other affiliated company.

We are a holding company

and may receive dividends paid by our subsidiaries established in China for our cash needs, including the funds necessary to pay dividends

and other cash distributions to our shareholders to the extent we choose to do so, to service any debt we may incur and to pay our operating

Baoding Shengde’s income in turn depends on the service and other fees paid by the consolidated VIE.

In addition, ITP,

its subsidiaries, the consolidated VIE and the VIE’s subsidiaries may also transfer cash to each other as part of the group cash

If any of our subsidiaries, the consolidated VIE and VIE’s subsidiaries incurs debt on its own behalf in the future,

the instruments governing such debt may restrict their ability to pay dividends or make other payments to us.

Current PRC regulations

permit our PRC Subsidiaries to pay dividends to us only out of their accumulated profits, if any, determined in accordance with Chinese

accounting standards and regulations.

In addition, under the applicable requirements of PRC law, our PRC Subsidiaries, consolidated VIE

and its subsidiary incorporated as companies may only distribute dividends after they have made allowances to fund certain statutory reserves.

These reserves are not distributable as cash dividends.

addition, under the Enterprise Income Tax Law of the PRC, which became effective on January 1, 2008 and its implementation rules, dividends

paid to us by our PRC Subsidiaries are subject to withholding tax.

The withholding tax on dividends may be exempted or reduced by the

PRC State Council.

Currently, the withholding tax rate is 10% unless reduced or exempted by treaty between the PRC and the tax residence

of the holder of the PRC Subsidiaries.

if our PRC Subsidiaries, consolidated VIE and its subsidiary in China incur debt on their own behalf in the future, the instruments governing

the debt may restrict their ability to pay dividends or make other payments to us.

In addition, the PRC tax authorities may require our

PRC Subsidiaries, consolidated VIE and its subsidiary to adjust their taxable income under the contractual arrangements we currently

have in place in a manner that would restrict our subsidiaries’ ability to pay dividends and make other distributions to us.

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 China.

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 our shareholders.

date, our PRC Subsidiaries have not paid dividends to us out of their accumulated profits.

In the near future, we do not expect to receive

dividends from our PRC subsidiaries because the accumulated profits of the PRC Subsidiaries are expected to be used for their own business

or expansions.

the year ended December 31, 2022, the cash flows occurred between IT Tech Packaging, its subsidiaries and the VIE included (i) funding

In addition, under the Enterprise

Income Tax Law of the PRC, which became effective on January 1, 2008 and its implementation rules, dividends paid to us by our PRC Subsidiaries

are subject to withholding tax.

The withholding tax on dividends may be exempted or reduced by the PRC State Council.

Currently, the withholding

tax rate is 10% unless reduced or exempted by treaty between the PRC and the tax residence of the holder of the PRC Subsidiaries.

Furthermore, if our PRC Subsidiaries,

consolidated VIE and its subsidiary in China incur debt on their own behalf in the future, the instruments governing the debt may restrict

their ability to pay dividends or make other payments to us.

In addition, the PRC tax authorities may require our PRC Subsidiaries, consolidated

VIE and its subsidiary to adjust their taxable income under the contractual arrangements we currently have in place in a manner that would

restrict our subsidiaries’ ability to pay dividends and make other distributions to us.

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

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 our shareholders.

To date, our PRC Subsidiaries

have not paid dividends to us out of their accumulated profits.

In the near future, we do not expect to receive dividends from our PRC

subsidiaries because the accumulated profits of the PRC Subsidiaries are expected to be used for their own business or expansions.

For the year ended December

31, 2023, the cash flows occurred between IT Tech Packaging, its subsidiaries and the VIE included (i) loans in the amount of $4,233,999

provided by Baoding Shengde to Tengsheng Paper;

(ii) loans in the amount of $2,822,666 provided by Baoding Shengde to Dongfang Paper;

(iii) the payment in the amount of 5,468,122 made by Dongfang Paper to Baoding Shengde for purchase of raw materials;

and (iv) funding

through Shengde Holdings Inc.

to Baoding Shengde, with an amount of $6,500,000 as capital contributions;

(ii) Baoding Shengde loans to

Dongfang Paper with total amount of $1,727,644;(iii) Baoding Shengde loans to Tengsheng Paper with total amount of $1,923,845;

funding through Shengde Holdings Inc.

to Qianrong, with an amount of $500,000 as capital contributions.

We do not have an established

cash management policy that dictates how funds are transferred between us, our PRC Subsidiaries, consolidated VIE and its subsidiary.

We do not, at this time, intend to distribute earnings or settle amounts owed under the VIE Agreements.

the future, cash proceeds raised from overseas financing activities may be transferred by ITP to our PRC Subsidiaries and other subsidiaries

or the consolidated VIE and its subsidiary via capital contributions or loans, as the case may be.

Amounts owed under the VIE Agreements

may be returned by Baoding Shengde or the consolidated VIE and its subsidiary through repayment of loans or payment of service fees according

to the exclusive technical service and business consulting agreement, subject to satisfaction of applicable government registration and

approval requirements.

To the extent cash in the business is in the PRC, the funds may not be available to fund operations or for other

use outside of the PRC due to interventions in or the imposition of restrictions and limitations on the ability of us, our PRC Subsidiaries,

or the consolidated VIE by the PRC government to transfer cash.

may rely on dividends and other distributions on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may

have, and any limitation on the ability of our PRC Subsidiaries to make payments to us could have a material and adverse effect on our

ability to conduct our business.

Tech Packaging Inc.

is a Nevada holding company and conducts all of its business through its operating subsidiaries and the VIE.

Packaging Inc.

relies principally on dividends and other distributions on equity from our PRC Subsidiaries for cash requirements, including

for services of any debt IT Tech Packaging Inc.

PRC Subsidiaries’ ability to distribute dividends is based upon its distributable earnings.

Current PRC regulations permit our

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

accounting standards and regulations.

If our PRC Subsidiaries incurs debt on its own behalf in the future, the instruments governing

the debt may restrict its ability to pay dividends or make other payments to us.

Any limitation on the ability of our PRC Subsidiaries

to distribute dividends or other payments to its shareholders could materially and adversely limit our ability to grow, make investments

or acquisitions that could be beneficial to our business, pay dividends or otherwise fund and conduct our business.

addition, the Enterprise Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable

to dividends payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties

or arrangements between the PRC central government and governments of other countries or regions where the non-PRC resident enterprises

are incorporated.

control of currency conversion may limit our ability to utilize our revenues effectively and affect the value of investors’ investment.

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

currency out of China.

We do not have an established cash management

policy that dictates how funds are transferred between us, our PRC Subsidiaries, consolidated VIE and its subsidiary.

We do not, at this

time, intend to distribute earnings or settle amounts owed under the VIE Agreements.

In the future, cash proceeds

raised from overseas financing activities may be transferred by ITP to our PRC Subsidiaries and other subsidiaries or the consolidated

VIE and its subsidiary via capital contributions or loans, as the case may be.

Amounts owed under the VIE Agreements may be returned by

Baoding Shengde or the consolidated VIE and its subsidiary through repayment of loans or payment of service fees according to the exclusive

technical service and business consulting agreement, subject to satisfaction of applicable government registration and approval requirements.

To the extent cash in the business is in the PRC, the funds may not be available to fund operations or for other use outside of the PRC

due to interventions in or the imposition of restrictions and limitations on the ability of us, our PRC Subsidiaries, or the consolidated

VIE by the PRC government to transfer cash.

We may rely on dividends and other distributions

on equity paid by our PRC subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our

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

IT Tech Packaging Inc.

a Nevada holding company and conducts all of its business through its operating subsidiaries and the VIE.

IT Tech Packaging Inc.

principally on dividends and other distributions on equity from our PRC Subsidiaries for cash requirements, including for services of

any debt IT Tech Packaging Inc.

Our PRC Subsidiaries’

ability to distribute dividends is based upon its distributable earnings.

Current PRC regulations permit our PRC Subsidiaries to pay dividends

to its shareholders only out of its accumulated profits, if any, determined in accordance with PRC accounting standards and regulations.

If our PRC Subsidiaries incurs debt on its own behalf in the future, the instruments governing the debt may restrict its ability to pay

dividends or make other payments to us.

Any limitation on the ability of our PRC Subsidiaries to distribute dividends or other payments

to its shareholders could materially and adversely limit our ability to grow, make investments or acquisitions that could be beneficial

to our business, pay dividends or otherwise fund and conduct our business.

In addition, the

Enterprise Income Tax Law and its implementation rules provide that a withholding tax rate of up to 10% will be applicable to dividends

payable by Chinese companies to non-PRC-resident enterprises unless otherwise exempted or reduced according to treaties or arrangements

between the PRC central government and governments of other countries or regions where the non-PRC resident enterprises are incorporated.

Governmental control of currency conversion may limit our ability

to utilize our revenues effectively and affect the value of investors’ investment.

The PRC government imposes

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

We receive a significant portion of our revenues in Renminbi.

Under our current corporate structure, our Nevada

holding company may rely on dividend payments from our PRC Subsidiaries to fund any cash and financing requirements we may have.

existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade

and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of SAFE by complying with

certain procedural requirements.

Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated

from the operations of our PRC subsidiaries in China may be used to pay dividends to our Nevada holding company.

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

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

As a result, we need

to obtain SAFE approval to use cash generated from the operations of our PRC subsidiaries and 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.

PRC government has imposed more restrictive foreign exchange policies and stepped up scrutiny of major outbound capital movement including

overseas direct investment.

More restrictions and substantial vetting process are put in place by SAFE to regulate cross-border transactions

falling under the capital account.

The PRC government may at its discretion further restrict access in the future to foreign currencies

for current account transactions.

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 our shareholders of our common stock.

Under our current corporate structure, our Nevada holding company may rely

on dividend payments from our PRC Subsidiaries to fund any cash and financing requirements we may have.

Under existing PRC foreign exchange

regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign

exchange transactions, can be made in foreign currencies without prior approval of SAFE by complying with certain procedural requirements.

Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated from the operations of our PRC

subsidiaries in China may be used to pay dividends to our Nevada holding company.

However, approval from or

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

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

As a result, we need to obtain

SAFE approval to use cash generated from the operations of our PRC subsidiaries and 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

The PRC government has imposed

more restrictive foreign exchange policies and stepped up scrutiny of major outbound capital movement including overseas direct investment.

More restrictions and substantial vetting process are put in place by SAFE to regulate cross-border transactions falling under the capital

The PRC government may at its discretion further restrict access in the future to foreign currencies for current account transactions.

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 our shareholders of our common stock.

PRC regulation of loans to and direct investment

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how SAFE and competent banks will carry this out in practice.

In light of the various requirements

imposed by PRC regulations on loans to and direct investment in PRC entities by offshore holding companies, we cannot assure you that

we will be able to complete the necessary government registrations or obtain the necessary government approvals on a timely basis, if

at all, with respect to future loans by IT Tech Packaging to its PRC Subsidiaries or with respect to future capital contributions by IT

Tech Packaging Inc.

In light of the various

requirements imposed by PRC regulations on loans to and direct investment in PRC entities by offshore holding companies, we cannot assure

you that we will be able to complete the necessary government registrations or obtain the necessary government approvals on a timely basis,

if at all, with respect to future loans by IT Tech Packaging to its PRC Subsidiaries or with respect to future capital contributions by

IT Tech Packaging Inc.

to its PRC Subsidiaries.

If we fail to complete such registrations or obtain such approvals, our ability to to capitalize

If we fail to complete such registrations or obtain such approvals, our ability to capitalize

or otherwise fund our PRC operations may be negatively affected, which could materially and adversely affect our liquidity and our ability

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an even more flexible currency policy, which could result in a further and more significant depreciation of the Renminbi against the U.S.

Failure to comply with PRC regulations

relating to the establishment of offshore special purpose companies by PRC residents may materially adversely affect us.

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 State Administration

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Effective measures, such as promoting the construction of relevant regulatory

systems, are to be taken to deal with the risks and incidents of China-based overseas-listed companies, cyber security and data privacy

systems, are to be taken to deal with the risks and incidents of China-based overseas-listed companies, cybersecurity and data privacy

protection requirements and similar matters.

The Measures for Cyber security Review issued by the CAC on January 4, 2022 also required

The Measures for Cybersecurity Review issued by the CAC on January 4, 2022 also required

that, among others, “critical information infrastructure” or internet platform operator holding over one million users’

personal information to apply for a cyber security review before any listing at a foreign country.

personal information to apply for a cybersecurity review before any listing at a foreign country.

These statements and regulations are

recently issued and there remain substantial uncertainties about their interpretation and implementation.

On 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, 2022.

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

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

According 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 process;

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 drafted.

On February 17, 2023, the CSRC

released the Trial Administrative Measures for Administration of Overseas Securities Offerings and Listings by Domestic Companies, or

the Trial Measures.

and five supporting guidelines, which came into effect on March 31, 2023.

Pursuant to the Trial Measures, domestic

companies that seek to offer or list securities overseas, both directly and indirectly, should fulfill the filing procedures and report

relevant information to the CSRC.

For more information about the Trial Measures, see “ Risk Factors — Risk Factors Relating

to Doing Business in China — The CSRC has released the Trial Measures for Administration of Overseas Securities Offerings

and Listings by Domestic Companies (the “Trial Measures”).

While such rules have become into effect, the Chinese government

may exert more oversight and control over offerings that are conducted overseas and foreign investment in China-based issuers, which could

significantly limit or completely hinder our ability to continue to offer our securities to investors and could cause the value of our

securities to significantly decline or become worthless ”

We believe that, as of the

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difficult for us to pursue growth through acquisitions in China.

Among other things, the M&A

Rules established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time

consuming and complex.

Such regulation requires, among other things, that the Ministry of Commerce be notified in advance of any change-of-control

transaction in which a foreign investor takes control of a PRC domestic enterprise or a foreign company with substantial PRC operations,

if certain thresholds under the Provisions on Thresholds for Prior Notification of Concentrations of Undertakings, issued by the State

Council in 2008, are triggered.

Moreover, the Anti-Monopoly Law requires that the anti-monopoly law enforcement authority shall be notified

in advance of any concentration of undertaking if certain thresholds are triggered.

In addition, the security review rules issued by the

State Council that became effective in March 2011 specify that mergers and acquisitions by foreign investors that raise “national

defense and security” concerns and mergers and acquisitions through which foreign investors may acquire de facto control over domestic

enterprises that raise “national security” concerns are subject to strict review by the Ministry of Commerce, and the rules

prohibit any activities attempting to bypass a security review, including by structuring the transaction through a proxy or contractual

control arrangement.

Among other things, the

M&A Rules established additional procedures and requirements that could make merger and acquisition activities by foreign investors

more time consuming and complex.

Such regulation requires, among other things, that the Ministry of Commerce be notified in advance of

any change-of-control transaction in which a foreign investor takes control of a PRC domestic enterprise or a foreign company with substantial

PRC operations, if certain thresholds under the Provisions on Thresholds for Prior Notification of Concentrations of Undertakings, issued

by the State Council in 2008, are triggered.

Moreover, the Anti-Monopoly Law requires that the anti-monopoly law enforcement authority

shall be notified in advance of any concentration of undertaking if certain thresholds are triggered.

In addition, the security review

rules issued by the State Council that became effective in March 2011 specify that mergers and acquisitions by foreign investors that

raise “national defense and security” concerns and mergers and acquisitions through which foreign investors may acquire de

facto control over domestic enterprises that raise “national security” concerns are subject to strict review by the Ministry

of Commerce, and the rules prohibit any activities attempting to bypass a security review, including by structuring the transaction through

a proxy or contractual control arrangement.

In the future, we may grow

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Such a shift could have a material adverse effect on our business and prospects.

The practical effect of the

PRC legal system on our business operations in the PRC can be viewed from two separate but intertwined considerations.

First, as a matter

of substantive law, the foreign invested enterprise laws provide significant protection from government interference.

In addition, these

laws guarantee the full enjoyment of the benefits of corporate articles and contracts to foreign invested enterprise participants.

laws, however, do impose standards concerning corporate formation and governance, which are qualitatively different from the general corporation

laws of the United States.

Similarly, the PRC accounting laws mandate accounting practices, which are not consistent with U.S.

accepted accounting principles.

PRC’s accounting laws require that an annual “statutory audit” be performed in accordance

with PRC accounting standards and that the books of account of foreign invested enterprises are maintained in accordance with Chinese

accounting laws.

Article 14 of the People’s Republic of China Wholly Foreign-Owned Enterprise Law requires a wholly foreign-owned

enterprise to submit certain periodic fiscal reports and statements to designated financial and tax authorities, at the risk of business

license revocation.

While the enforcement of substantive rights may appear less clear than United States procedures, foreign invested

enterprises and wholly foreign-owned enterprises are Chinese registered companies, which enjoy the same status as other Chinese registered

companies in business-to-business dispute resolution.

Any award rendered by an arbitration tribunal is enforceable in accordance with

the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958).

Therefore, as a practical matter,

although no assurances can be given, the Chinese legal infrastructure, while different in operation from its United States counterpart,

should not present any significant impediment to the operation of foreign invested enterprises.

The practical effect of

the PRC legal system on our business operations in the PRC can be viewed from two separate but intertwined considerations.

matter of substantive law, the foreign invested enterprise laws provide significant protection from government interference.

these laws guarantee the full enjoyment of the benefits of corporate articles and contracts to foreign invested enterprise participants.

These laws, however, do impose standards concerning corporate formation and governance, which are qualitatively different from the general

corporation laws of the United States.

Similarly, the PRC accounting laws mandate accounting practices, which are not consistent with

generally accepted accounting principles.

PRC’s accounting laws require that an annual “statutory audit” be performed

in accordance with PRC accounting standards and that the books of account of foreign invested enterprises are maintained in accordance

with Chinese accounting laws.

Article 14 of the People’s Republic of China Wholly Foreign-Owned Enterprise Law requires a wholly

foreign-owned enterprise to submit certain periodic fiscal reports and statements to designated financial and tax authorities, at the

risk of business license revocation.

While the enforcement of substantive rights may appear less clear than United States procedures,

foreign invested enterprises and wholly foreign-owned enterprises are Chinese registered companies, which enjoy the same status as other

Chinese registered companies in business-to-business dispute resolution.

Any award rendered by an arbitration tribunal is enforceable

in accordance with the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958).

Therefore, as a

practical matter, although no assurances can be given, the Chinese legal infrastructure, while different in operation from its United

States counterpart, should not present any significant impediment to the operation of foreign invested enterprises.

Because our principal assets are located

140 unchanged sentences

operations and financial condition.

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

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 ownership.

We do not have direct or

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to enter into similar agreements with other parties, we will lose control of Dongfang Paper.

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.

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.

We are a holding company

6 unchanged sentences

service providers.

If 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.

If 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.

Recently, the PRC government

9 unchanged sentences

the assets of our PRC Subsidiaries that conduct all or substantially all of our business operations.

The 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.

The 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.

The contractual arrangements

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some of our business operations and constrain our growth.

IT Tech Packaging relies on

contractual arrangements with the VIE to use, or otherwise benefit from, certain foreign restricted licenses and permits that it needs

IT Tech Packaging relies

on contractual arrangements with the VIE to use, or otherwise benefit from, certain foreign restricted licenses and permits that it needs

or may need in the future as its business continues to expand.

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Risks Related to Our Common Stock

Our common stock may be delisted from the NYSE American under

the Holding Foreign Companies Accountable Act if the PCAOB is unable to adequately inspect audit documentation located in China.

The delisting

of our common stock, or the threat of their being delisted, may materially and adversely affect the value of your investment.

The HFCAA, was enacted on December 18, 2020.

The HFCAA states if the

SEC determines that a company has filed audit reports issued by a registered public accounting firm that has not been subject to inspection

by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit such ordinary shares from being traded on a national

securities exchange or in the over the counter trading market in the U.S.

Our common stock may be delisted from the

NYSE American under the Holding Foreign Companies Accountable Act if the PCAOB is unable to adequately inspect audit documentation located

The delisting of our common stock, or the threat of their being delisted, may materially and adversely affect the value of your

The HFCAA, was enacted on

December 18, 2020.

The HFCAA states if the SEC determines that a company has filed audit reports issued by a registered public accounting

firm that has not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit such ordinary

shares from being traded on a national securities exchange or in the over the counter trading market in the U.S.

On March 24, 2021, the SEC

45 unchanged sentences

in mainland China and Hong Kong.

Our auditor, WWC, P.C., Certified Public Accountants, the independent

registered public accounting firm that issued the audit report included in our annual report, an auditor of companies that are traded

publicly in the United States and an U.S.-based accounting firm registered with the PCAOB, is subject to laws in the United States pursuant

to which the PCAOB conducts regular inspections to assess its compliance with the applicable professional standards.

Our auditor is based

in the United States and is subject to inspection by the PCAOB on a regular basis with the last inspection in November 2021.

However, our auditor’s working papers related to us and the consolidated

VIE and its subsidiary are located in China.

If our auditor is not permitted to provide requested audit work papers located in China to

the PCAOB, investors would be deprived of the benefits of PCAOB’s oversight of our auditor through such inspections which could

result in limitation or restriction to our access to the U.S.

capital markets, and trading of our securities may be prohibited under the

HFCAA, which would result in the delisting of our securities from the NYSE American.

Our auditor, GGF CPA Limited

, the independent registered public accounting firm that issued the audit report included in our annual report, an auditor of companies

that are traded publicly in the United States and a China-based accounting firm registered with the PCAOB, is subject to laws in the United

States pursuant to which the PCAOB conducts regular inspections to assess its compliance with the applicable professional standards.

However, our auditor’s

working papers related to us and the consolidated VIE and its subsidiary are located in China.

If our auditor is not permitted to provide

requested audit work papers located in China to the PCAOB, investors would be deprived of the benefits of PCAOB’s oversight of our

auditor through such inspections which could result in limitation or restriction to our access to the U.S.

capital markets, and trading

of our securities may be prohibited under the HFCAA, which would result in the delisting of our securities from the NYSE American.

If we fail to comply with Section 404 of

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subordination of stockholders’ interests to the debt, create the possibility of default, and limit our financial and business alternatives.

Unresolved Staff Comments

Not applicable.

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 1A. Risk Factors