What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2025-09-11 compared with 2024-04-17 · 927 added, 837 removed, 60 unchanged (97% of the section changed)

our wholly-owned subsidiaries, we are engaged in the research, development, manufacturing, sales and servicing of medium to large sized

projected capacitive touchscreens.

We specialize in large-format touchscreens, which are developed and designed for a wide variety of

markets and used in the financial terminals, automotive, Point of Sales, gaming, lottery, medical, Human-Machine Interface (“HMI”),

and other specialized industries.

product portfolio comprises medium to large sized projected capacitive touchscreens ranging from 7.0 inch to 42 inch screens.

of the structures of touch panels, we offer (i) Glass-Glass (“GG”), primarily used in GPS/car entertainment panels in mid-size

and luxury cars, industrial HMI, financial and banking terminals, POS and lottery machines;

(ii) Glass-Film-Film (“GFF”),

mostly used in high-end GPS and entertainment panels, industrial HMI, financial and banking terminals, and the lottery and gaming industry;

(iii) Plastic-Glass (“PG”), typically adopted by touchscreens in GPS/entertainment panels, motor vehicle GPS, smart home,

robotics and charging stations;

and (iv) Glass-Film (“GF”), mostly used in industrial HMI.

the industry standards for product quality and sustainability is one of our core values.

Touchscreens produced by us not only have long

life span with low maintenance, but also have strong anti-interference and anti-corrosion solutions, coupled with multi-touch capability

and high light-transmittance ratio and stability.

As a high technology company, Sichuan Vtouch Technology Co., Ltd., our subsidiary in

Mainland China (“Sichuan Vtouch”) has received certifications from domestic and

international institutions, such as ISO9001 Quality Management Systems (QMS) Certification of Registration, ISO 14001 Environmental Management

System (EMS) Certification of Registration, and RoHS SGS Certification (Restriction of Hazardous Substance Testing Certification).

We generate revenues through sales of our various touchscreen products.

For the year ended December 31, 2023 and 2022, we recognized approximately $39.7 million and $37.9 million, respectively, in revenues.

sell our touchscreen products both domestically in China and internationally, covering major areas in Mainland China, including but not

limited to the eastern, southern, northern and southwest regions of Mainland China, Taiwan, South Korea, and Germany.

We believe that

we have established a strong and diversified client base.

For the year ended December 31, 2023 and 2022, our domestic sales accounted

for 69.6% and 69.7%, respectively, of our revenues, and our international sales accounted for 30.4% and 30.3%, respectively, of our revenues.

History and Structure

were originally incorporated under the laws of the state of Nevada on August 31, 1992 as Gulf West Investment Properties, Inc, and were

dormant and had no operations for many years.

February 26, 2019, the Eighth Judicial District Court in and for Clark County, Nevada, Case No.

A-19-787151-B, appointed Custodian Ventures

LLC, an affiliate of David Lazar, as custodian of the Company (the “Custodian”).

Lazar was appointed as the sole officer

and director of the Company.

On March 11, 2019, 85,715 shares of common stock of the Company were issued to the Custodian in consideration

for the payment of cash and the issuance of a promissory note by the Custodian to the Company.

Effective as of June 11, 2019, the court

discharged the Custodian’s duties.

June 18, 2020, we consummated the transactions contemplated by a Stock Purchase Agreement among the Company, the Custodian, Qixun

Through our wholly-owned subsidiaries,

we are engaged in the research, development, manufacturing, sales and servicing of medium- to large-sized projected capacitive touchscreens.

We specialize in large-format touchscreens, which are developed and designed for a wide variety of markets and used in the financial terminals,

automotive, Point of Sales, gaming, lottery, medical, Human-Machine Interface (“HMI”), and other specialized industries.

Our product portfolio comprises

medium- to large-sized projected capacitive touchscreens ranging from 7.0 inch to 42-inch screens.

In terms of the structures of touch

panels, we offer (i) Glass-Glass (“GG”), primarily used in GPS/car entertainment panels in mid-size and luxury cars, industrial

HMI, financial and banking terminals, POS and lottery machines;

(ii) Glass-Film-Film (“GFF”), mostly used in high-end GPS

and entertainment panels, industrial HMI, financial and banking terminals, and the lottery and gaming industry;

(iii) Plastic-Glass (“PG”),

typically adopted by touchscreens in GPS/entertainment panels, motor vehicle GPS, smart home, robotics and charging stations;

Glass-Film (“GF”), mostly used in industrial HMI.

Maintaining the industry standards

for product quality and sustainability is one of our core values.

Touchscreens produced by us not only have long life span with low maintenance,

but also have strong anti-interference and anti-corrosion solutions, coupled with multi-touch capability and high light-transmittance

ratio and stability.

As a technology company, Sichuan Vtouch Technology Co., Ltd., our subsidiary in Mainland China (“Sichuan Vtouch”)

has received certifications from domestic and international institutions, such as ISO9001 Quality Management Systems (QMS) Certification

of Registration, ISO 14001 Environmental Management System (EMS) Certification of Registration, and RoHS SGS Certification (Restriction

of Hazardous Substance Testing Certification).

We generate revenues through

sales of our various touchscreen products.

For the years ended December 31, 2024 and 2023, we recognized approximately $42.3 million and

$39.7 million, respectively, in revenues.

We sell our touchscreen products

both domestically in China and internationally, covering major areas in Mainland China, including but not limited to the eastern, southern,

northern and southwest regions of Mainland China, Taiwan, South Korea, Germany and other countries.

We believe that we have established

a strong and diversified client base.

For the years ended December 31, 2024 and 2023, our domestic sales accounted for approximately 64.7%

and 69.7%, respectively, of our revenues, and our international sales accounted for approximately 35.3% and 30.3%, respectively, of our

Corporate History and Structure

We were originally incorporated

under the laws of the state of Nevada on August 31, 1992 as Gulf West Investment Properties, Inc, and were dormant and had no operations

for many years.

On February 26, 2019, the

Eighth Judicial District Court in and for Clark County, Nevada, Case No.

A-19-787151-B, appointed Custodian Ventures LLC, an affiliate

of David Lazar, as custodian of the Company (the “Custodian”).

Lazar was appointed as the sole officer and director of

On March 11, 2019, 85,715 shares of common stock of the Company were issued to the Custodian in consideration for the payment

of cash and the issuance of a promissory note by the Custodian to the Company.

Effective as of June 11, 2019, the court discharged the

Custodian’s duties.

On June 18, 2020, we consummated

the transactions contemplated by a Stock Purchase Agreement among the Company, the Custodian, Qixun

Technology (Samoa) Limited (“Qixun Samoa”) and Qihong Technology (Samoa) Limited

1 unchanged sentence

Pursuant to the Stock Purchase

Agreement, the Buyers acquired all of the 85,715 shares of the Company owned by the Custodian, representing 50.47% of the issued and

outstanding shares of the Company.

The Custodian and the Company agreed to indemnify the Buyers from any liabilities of the Company occurring

prior to June 18, 2020, and the promissory note issued by the Custodian to the Company was canceled.

Immediately following the closing,

David Lazar resigned as the sole officer and director of the Company and Jiaying Cai was appointed as president, secretary and treasurer

of the Company and as the sole director.

September 30, 2020, we changed our name from Gulf West Investment Properties, Inc.

Agreement, the Buyers acquired all of the 85,715 shares of the Company owned by the Custodian, representing 50.47% of the issued and outstanding

shares of the Company.

The Custodian and the Company agreed to indemnify the Buyers from any liabilities of the Company occurring prior

to June 18, 2020, and the promissory note issued by the Custodian to the Company was canceled.

Immediately following the closing, David

Lazar resigned as the sole officer and director of the Company and Jiaying Cai was appointed as president, secretary and treasurer of

the Company and as the sole director.

Effective September 30, 2020,

we changed our name from Gulf West Investment Properties, Inc.

to Wetouch Technology Inc.

by filing an Amended and

Restated Articles of Incorporation with the Nevada Secretary of State to give effect to a name change.

As a result of the name change,

we changed our trading symbol from “GLFW” to “WETH,” effective November 3, 2020.

Amended and Restated Articles also effectuated a reverse split of our authorized, issued and outstanding shares of common stock on a

70 for 1 new basis whereby each 70 shares of outstanding common stock was exchanged for one (1) share of new common stock (the “Reverse

Split” and, for avoidance of doubt, all share amounts set forth herein shall be post Reverse Split unless otherwise specified)

and, consequently, our authorized common stock increased to 300,000,000 shares of common stock and 10,000,000 shares of preferred stock,

and our then issued and outstanding common shares decreased from 11,887,103 to 169,820 shares, all with a par value of $0.001 per

October 9, 2020, we entered into a share exchange agreement (the “Share Exchange Agreement”) with Wetouch Holding Group Limited,

a British Virgin Islands company incorporated on August 14, 2020 under the laws of the British Virgin Islands (“BVI Wetouch”),

and all the shareholders of BVI Wetouch (each a “BVI Wetouch Shareholder” and collectively the “BVI Wetouch Shareholders”),

to acquire all the issued and outstanding capital stock of BVI Wetouch in exchange for the issuance to the BVI Wetouch Shareholders an

aggregate of 28 million shares of our common stock (the “Reverse Merger”).

by filing an Amended and Restated Articles of

Incorporation with the Nevada Secretary of State to give effect to a name change.

As a result of the name change, we changed our trading

symbol from “GLFW” to “WETH,” effective November 3, 2020.

Reverse Merger

On October 9, 2020, we entered

into a share exchange agreement (the “Share Exchange Agreement”) with Wetouch Holding Group Limited, a British Virgin Islands

company incorporated on August 14, 2020 under the laws of the British Virgin Islands (“BVI Wetouch”), and all the shareholders

of BVI Wetouch (each a “BVI Wetouch Shareholder” and collectively the “BVI Wetouch Shareholders”), to acquire

all the issued and outstanding capital stock of BVI Wetouch in exchange for the issuance to the BVI Wetouch Shareholders an aggregate

of 28 million shares of our common stock (the “Reverse Merger”).

The Reverse Merger closed on October 9, 2020.

Immediately after the closing of the Reverse Merger, we had a total of 31,396,394 issued and outstanding shares of common stock.

result of the Reverse Merger, BVI Wetouch is now our wholly-owned subsidiary.

October 12, 2020, Guangde Cai was appointed as an additional director and Chairman of the Company.

On October 12, 2020, Mr.

was appointed as president and chief executive officer of the Company, and Mr.

Yuhua Huang was appointed as chief financial officer of

On the same day, Jiaying Cai resigned from the capacity of president and treasurer of the Company but remains the secretary

and director of the Company.

Wetouch was established under the laws of British Virgin Islands on August 14, 2020 to acquire all the shares of Hong Kong Wetouch Electronics

Technology Limited (“Hong Kong Wetouch”).

On September 11, 2020, BVI Wetouch acquired all the outstanding shares of Hong

Kong Wetouch from the shareholders of Hong Kong Wetouch in consideration of HK$10,000 pursuant to instruments of transfer in accordance

with Hong Kong law.

As a result of the acquisition, Hong Kong Wetouch became a wholly-owned subsidiary of BVI Wetouch.

The shareholders

of Hong Kong Wetouch became the shareholders of BVI Wetouch in said transaction, and therefore the shareholders who controlled Hong Kong

Wetouch became the controlling shareholders of BVI Wetouch.

Kong Wetouch was incorporated on May 5, 2016 under the laws of Hong Kong.

On July 19, 2016, Hong Kong Wetouch acquired all the shares

of Sichuan Wetouch Technology Co., Ltd, a PRC company established in Meishan, Sichuan on May 6, 2011 (“Sichuan Wetouch”).

As a result of the acquisition, Sichuan Wetouch became a wholly owned subsidiary of Hong Kong Wetouch.

BVI Wetouch owns all the outstanding shares of Hong Kong Wetouch, which, in turn, owns all the outstanding shares of Sichuan Wetouch,

the Company owns indirectly all the business of Sichuan Wetouch.

As a result of the Reverse Merger, Hong Kong Wetouch and Sichuan Wetouch become our indirect wholly-owned subsidiaries.

of HK Wetouch

Kong Wetouch Technology Limited, a limited company organized under the laws of Hong Kong (“HK Wetouch”), was incorporated on December 3, 2020 under the laws of Hong Kong.

HK Wetouch was established

to own all the outstanding shares of Sichuan Vtouch Technology Co., Ltd., which was incorporated on December 30, 2020 in Chengdu, Sichuan,

under the laws of The People’s Republic of China (“China,” or the “PRC”).

March 12, 2021, BVI Wetouch, the Company’s wholly owned subsidiary, acquired all the outstanding shares of HK Wetouch from the

sole shareholder of HK Wetouch, Guangde Cai, who was our former Chairman and Director in consideration of the payment of HK$10,000 pursuant

to the instruments of transfer in accordance with Hong Kong law.

As a result of the acquisition, HK Wetouch became a wholly-owned subsidiary

of BVI Wetouch.

Immediately following the acquisition of HK Wetouch, BVI Wetouch owned (i) all the outstanding shares of Hong Kong Wetouch,

which, in turn, owned all the outstanding shares of Sichuan Wetouch and (ii) all of the outstanding shares of HK Wetouch, which owned

all the shares of Sichuan Vtouch.

March 2, 2021, HK Wetouch acquired all shares of Hong Kong Wetouch.

On June 18, 2021, Hong Kong Wetouch submitted its application for

dissolution and was dissolved on March 18, 2022.

In addition, as of March 31, 2021, Sichuan Wetouch’s business and operations have

been assumed by Sichuan Vtouch.

March 30, 2023, an independent third party acquired all the shares of Sichuan Wetouch for a nominal amount.

diagram below sets forth our corporate structure as of the date of this Annual Report.

January 19, 2023, we entered into a securities purchase agreement with certain investors, pursuant to which we sold to such investors

an aggregate of 160,000,000 shares of the common stock of the Company for an aggregate purchase price of $40,000,000, or $0.25 per share.

The net proceeds of the offering (after deducting legal and accounting fees and expenses) shall be used by the Company for working capital

and general corporate purposes and the repayment of debt.

The issuance of the shares in the private placement was exempted from registration

pursuant to Section 4(a)(2) and/or Regulation S as promulgated by the U.S.

Securities and Exchange

Commission under the Securities Act.

The securities are subject to transfer restrictions, and the certificates evidencing the shares

will contain an appropriate legend stating that such securities have not been registered under the Securities Act and may not be offered

or sold absent registration or pursuant to an exemption therefrom.

Placement Consent Agreement

March 18, 2023, the Company entered into a private placement consent agreement with a third-party investment bank firm (see Note 10)

on the agent fees of US$1.2 million, payable only on the completion of a private placement.

If the private placement is not completed

by November 1, 2023, the representatives under the agreement reserve their rights to pursue any and all claims, actions or remedies available

BVI Wetouch was formed to

acquire Hong Kong Wetouch Electronics Technology Limited (“Hong Kong Wetouch”), which it acquired on September 11, 2020.

a result, Hong Kong Wetouch became a wholly owned subsidiary of BVI Wetouch.

Hong Kong Wetouch was incorporated

on May 5, 2016 and, on July 19, 2016, acquired all the shares of Sichuan Wetouch Technology Co., Ltd., a PRC company established on May

6, 2011 (“Sichuan Wetouch”).

As a result, Sichuan Wetouch became a wholly owned subsidiary of Hong Kong Wetouch.

Through BVI Wetouch’s

ownership of Hong Kong Wetouch (later dissolved) and Sichuan Wetouch, we indirectly owned the business of Sichuan Wetouch.

Following the

Reverse Merger, Sichuan Wetouch became our indirect wholly owned subsidiary.

Acquisition of HK Wetouch

Hong Kong Wetouch Technology

Limited, a limited company organized under the laws of Hong Kong (“HK Wetouch”), was incorporated on December 3, 2020 to hold

all the shares of Sichuan Vtouch Technology Co., Ltd., which was incorporated on December 30, 2020 in Chengdu, Sichuan, under the laws

of The People’s Republic of China (“China,” or the “PRC”).

On March 12, 2021, BVI Wetouch,

our wholly owned subsidiary, acquired all the shares of HK Wetouch from its sole shareholder, Guangde Cai (our former Chairman and Director).

As a result, HK Wetouch became a wholly-owned subsidiary of BVI Wetouch.

Immediately following the acquisition of HK Wetouch, BVI Wetouch

owned (i) all the outstanding shares of Hong Kong Wetouch, which, in turn, owned all the outstanding shares of Sichuan Wetouch and (ii)

all of the outstanding shares of HK Wetouch, which owned all the shares of Sichuan Vtouch.

On March 2, 2021, HK Wetouch

acquired all shares of Hong Kong Wetouch.

Hong Kong Wetouch was dissolved on March 18, 2022.

In addition, as of March 31, 2021, Sichuan

Wetouch’s business and operations were assumed by Sichuan Vtouch.

On March 30, 2023, an independent

third party acquired all the shares of Sichuan Wetouch for a nominal amount.

Corporate Structure

The diagram below sets forth

our corporate structure as of the date of this Annual Report.

Private Placement

January 19, 2023, we entered into a securities purchase agreement with certain investors, pursuant to which we sold an aggregate of 160,000,000

shares of common stock of the Company for an aggregate purchase price of $40,000,000, or $0.25 per share.

The net proceeds of the offering

(after deducting legal and accounting fees and expenses) were used by the Company for working capital and general corporate purposes and

the repayment of debt.

The issuance of the shares in the private placement was exempted from registration pursuant to Section 4(a)(2)

and/or Regulation S as promulgated by the U.S.

Securities and Exchange Commission under the Securities Act.

The securities are subject

to transfer restrictions, and the certificates evidencing the shares will contain an appropriate legend stating that such securities have

not been registered under the Securities Act and may not be offered or sold absent registration or pursuant to an exemption therefrom.

Private Placement

Consent Agreement

March 18, 2023, the Company entered into a private placement consent agreement with a third-party investment bank firm (see Note 10) on

the agent fees of US$1.2 million, payable only on the completion of a private placement.

If the private placement is not completed by

November 1, 2023, the representatives under the agreement reserve their rights to pursue any and all claims, actions or remedies available

to them under the engagement between the Company and the private placement representatives.

The Company made the full payment in February

Reverse Stock Splits

our incorporation, we have effected two reverse stock splits of our common stock.

Reverse Stock Split:

September 30, 2020, in connection with our name change from Gulf West Investment Properties, Inc.

to Wetouch Technology Inc., we effected

a 1-for-70 reverse stock split of our common stock.

As a result, every 70 shares of outstanding common stock were exchanged for one share

of new common stock.

Our issued and outstanding shares decreased from 11,887,103 to 169,820, while the authorized common stock was adjusted

to 300,000,000 shares and preferred stock to 10,000,000 shares, all with a par value of $0.001 per share.

Reverse Stock Split:

February 17, 2023, our board of directors (the “Board”) authorized a reverse stock split of our common stock at a ratio of

not less than one to five (1:5) and not more than one to eighty (1:80), with the exact amount and the timing of the reverse stock split

to be as determined by the Chairman of the Board.

Upon effectiveness of such reverse stock split, the number of authorized shares of

the common stock of the Company will also be decreased in the same ratio.

not less than one to five (1:5) and not more than one to eighty (1:80), with the exact ratio and the timing of the reverse stock split

to be determined by the Chairman of the Board.

Upon effectiveness of such reverse stock split, the number of authorized shares of common

stock of the Company will also be decreased in the same ratio.

July 16, 2023, the Company’s board of directors approved the reverse stock split of the Company’s common stock at a ratio

1 unchanged sentence

of State pursuant to Section 78.209 of the Nevada Revised Statutes to effectuate a 1-for-20 reverse stock split of its common stock.

On September 11, 2023, the reverse stock split was approved by the Financial Industry Regulatory Authority and took effect on September

All share information included in this annual report has been adjusted as if the reverse stock split occurred as of the earliest

period presented.

September 11, 2023, the reverse stock split was approved by the Financial Industry Regulatory Authority and took effect on September 12,

All share information included in this annual report has been retroactively adjusted as if the reverse stock split had occurred

as of the earliest period presented.

2024 Uplisting Offering

February 20, 2024, we entered into an underwriting agreement with WestPark Capital, Inc.

and Craft Capital Management LLC, as

representatives (the “Public Offering Representatives”) of the underwriters listed in the underwriting agreement (the

“Underwriters”), pursuant to which the Company agreed to sell to the Underwriters in a firm commitment underwritten

public offering (the “Offering”) up to an aggregate of 2,484,000 shares

of our common stock, par value $0.001 per share, at a public offering price of $5.00 per share.

The Offering was conducted pursuant

to a Registration Statement on Form S-1, as amended (SEC filed No.

333-270726), which was declared effective on February 14, 2024.

In connection with the Offering, our common stock began trading on the Nasdaq Capital Market under the symbol WETH on February 21,

The Offering closed on February 23, 2024 and generated gross proceeds of $10.8 million.

We paid a total of approximately $0.8

million in underwriting discounts and commissions, and approximately $0.8 million for other costs and expenses related to the

Our net proceeds from the Offering, after deducting the underwriting discount, the Underwriters’ fees and expenses,

and our Offering expenses, were approximately $9.2 million.

We also issued the Representatives’ Warrants (the “Public

Offering Representatives’ Warrants”) to the Public Offering Representatives to purchase 43,200 shares of Common Stock at

an exercise price equal to 125.0% of the public offering price.

and Craft Capital Management LLC, as representatives

(the “2024 Uplisting Offering Representatives”) of the underwriters listed in the underwriting agreement (the “Underwriters”),

pursuant to which we agreed to sell to the Underwriters in a firm commitment underwritten public offering (the “2024 Uplisting Offering”)

of an aggregate of 2,160,000 shares of our common stock, par value $0.001 per share, at a public offering price of $5.00 per share.

The 2024 Uplisting Offering was conducted pursuant to a Registration Statement on Form S-1, as amended (SEC filed No.

333-270726), which

was declared effective on February 14, 2024.

In connection with the 2024 Uplisting Offering, our common stock began trading on the Nasdaq

Capital Market under the symbol WETH on February 21, 2024.

The 2024 Uplisting Offering closed on February 23, 2024 and generated gross

proceeds of $10.8 million.

We paid a total of approximately $0.8 million in underwriting discounts and commissions, and approximately

$0.8 million for other costs and expenses related to the 2024 Uplisting Offering.

Our net proceeds from the 2024 Uplisting Offering, after

deducting the underwriting discount, the Underwriters’ fees and expenses, and our 2024 Uplisting Offering expenses, was approximately

$9.2 million.

We also issued the Representatives’ Warrants (the “2024 Uplisting Offering Representatives’ Warrants”)

to the 2024 Uplisting Offering Representatives to purchase 43,200 shares of common stock at an exercise price equal to 125.0% of the public

offering price.

Recent Development

December 31, 2024, the Company has reported several material events in Current Reports on Form 8-K, including changes to the management

of the Company;

correspondence from Nasdaq regarding late periodic filings and the acceptance of our plan to regain compliance;

of deficiency with the $1.00 minimum bid price requirement;

and a change in our independent registered public accounting firm.

submitted compliance plans to Nasdaq as requested and is working diligently to rectify the deficiencies as promptly as practicable to

regain compliance with the Listing Rule.

brief summaries that follow are qualified in their entirety by, and should be read together with, the Company’s Current Reports

on Form 8-K filed since December 31, 2024.

On April 29, 2025, Jing Chen resigned from the Board and its committees.

Effective May 1, 2025, Jing Guo was appointed to

committee roles were reconstituted as described in the Current Report on Form 8-K filed on May 2, 2025.

compliance - late filings .

On May 27, 2025, Nasdaq notified the Company that it was not in compliance with Listing Rule 5250(c)(1)

due to the delayed Form 10-K for the year ended December 31, 2024 and Form 10-Q for the quarter ended March 31, 2025.

On June 26, 2025,

Nasdaq accepted the Company’s plan of compliance and granted an exception through October 13, 2025 to file the outstanding Form

10-K (FY 2024) and Form 10-Qs for the quarters ended March 31 and June 30, 2025.

On June 27, 2025, the Audit Committee dismissed Enrome LLP as the Company’s independent registered public accounting

The Company disclosed there were no disagreements or reportable events within the meaning of Item 304.

On June 27, 2025, the Company

appointed ST & Partners PLT as its independent registered public accounting firm.

compliance - bid-price notice .

On July 15, 2025, Nasdaq notified the Company that it was not in compliance with the $1.00 minimum

bid price requirement and provided a 180-day compliance period ending January 12, 2026.

additional details, see the Company’s Current Reports on Form 8-K filed May 2, 2025;

May 30, 2025;

June 26, 2025;

June 30, 2025;

and July 15, 2025.

offer medium- to large-sized projected capacitive touchscreens, which can be categorized as set forth below:

is a double glass layer product, with a solid clear adhesive (SCA) between a layer of conductive glass and a layer of tempered glass.

This type of touch screen has the advantage of being able to be easily manufactured, with relatively low cost.

However, products

of this type in large sizes will require a greater degree of signal penetration and long distance transmission technology which will

be more technically challenging to achieve.

and high end GPS/car entertainment, finance, POS and lottery machines.

product uses a double layer of conductive films, with an optically clear adhesive (OCA) between a layer of tempered glass.

The product’s

functionality comes from the interaction between the multiple layers of conductive film and glass, which does not require extensive

coating, lithography and etching.

Product type GG

This is a double glass layer product, with a solid clear adhesive (SCA) between a layer of conductive glass and a layer of tempered glass.

This type of touchscreen has the advantage of being able to be easily manufactured, with relatively low cost.

However, products of this type in large sizes will require a greater degree of signal penetration and long distance transmission technology which will be more technically challenging to achieve.

Medium and high end GPS/car entertainment, finance, POS and lottery machines.

Product type GFF

This product uses a double layer of conductive films, with an optically clear adhesive (OCA) between a layer of tempered glass.

The product’s functionality comes from the interaction between the multiple layers of conductive film and glass, which does not require extensive coating, lithography and etching.

This type of product is anti- explosive and has relatively low manufacturing cost.

However, products

of this type in large sizes will require greater degree of signal penetration and long distance transmission technology which will

be more technically challenging to achieve.

gaming and lottery, and medical industries

product uses a layer of conductive glass, with an optically clear adhesive (OCA) between a layer of surface intensify PMMA (Poly

Methyl methacrylate acid).

However, products of this type in large sizes will require greater degree of signal penetration and long distance transmission technology which will be more technically challenging to achieve.

Financial, gaming and lottery, and medical industries

Product type PG

This product uses a layer of conductive glass, with an optically clear adhesive (OCA) between a layer of surface intensify PMMA (Poly Methyl methacrylate acid).

The product’s functionality relies on the interaction between the layers of conductive glass.

the GFF type, this product does not require extensive coating, lithography and etching and has relatively low manufacturing cost.

vehicle GPS, smart home, robots and charging stations

product uses a layer of conductive film, with an optically clear adhesive (OCa) between a layer of tempered glass.

The product’s

functionality relies on the interaction between the layers of conductive glass.

Like the GFF type, this product does not require

extensive coating, lithography and etching and has relatively low manufacturing cost.

of December 31, 2023, product types GFF and GG constitute our main stream products, accounting for approximately an average

Like the GFF type, this product does not require extensive coating, lithography and etching and has relatively low manufacturing cost.

Motor vehicle GPS, smart home, robots and charging stations

Product type GF

This product uses a layer of conductive film, with an optically clear adhesive (OCa) between a layer of tempered glass.

The product’s functionality relies on the interaction between the layers of conductive glass.

Like the GFF type, this product does not require extensive coating, lithography and etching and has relatively low manufacturing cost.

Industrial HMI

of December 31, 2024, product types GFF and GG constitute our main stream products, accounting for approximately an average of 38.5% and

52.7%, respectively, of our total revenues, with product types GF and PG accounting for 2.6%, 4.4% and 1.9%%, respectively, of our total

As of December 31, 2023, product types GFF and GG constitute our main stream products, accounting for approximately an average

of 41.8% and 51.7%, respectively, of our total revenues, with product types GF and PG and other raw materials accounting for 2.0%, 2.4%

and 2.1%, respectively, of our total revenues.

As of December 31, 2022, product types GFF and GG

constitute our main stream products, accounting for approximately an average of 38.5% and 52.68%, respectively, of our total

revenues, with product types GF and PG and other raw materials accounting for 2.55%, 4.4% and 1.87%, respectively, of our total

of the Company’s Products

products are used and applied in the production of a variety of products in a wide range of industries.

Our products’ areas of

common application are set out below.

of Sale (“POS”) Machines

machines are used in a variety of retailers, including in department stores, supermarkets, convenience

stores, boutiques, restaurants, hotels, banks, logistics, telecommunication and other service industries.

Due to the frequent use

of touchscreens on POS machines, Wetouch has adopted the use of high-end materials which give its products’ a competitive advantage

through their anti-scratch, high temperature resistance and long use life qualities.

Navigators and Entertainment Systems

products for car navigation and entertainment systems take advantage of the popularity of touchscreen consoles in motor vehicles.

Wetouch touchscreens are particularly suitable for motor vehicles GPS and entertainment systems, due to their resistance to temperature

Applications of the Company’s Products

Our products are used and

applied in the production of a variety of products in a wide range of industries.

Our products’ areas of common application are

set out below.

Point of Sale (“POS”) Machines

POS machines are used in a variety of retailers, including in department stores, supermarkets, convenience stores, boutiques, restaurants, hotels, banks, logistics, telecommunication and other service industries.

Due to the frequent use of touchscreens on POS machines, Wetouch has adopted the use of high-end materials which give its products’ a competitive advantage through their anti-scratch, high temperature resistance and long use life qualities.

Car Navigators and Entertainment Systems

Touchscreen products for car navigation and entertainment systems take advantage of the popularity of touchscreen consoles in motor vehicles.

Wetouch touchscreens are particularly suitable for motor vehicles GPS and entertainment systems, due to their resistance to temperature variation.

These touchscreens may be used in both inbuilt and external car systems.

Machines and Other Financial Machines

and other similar machines use touchscreens or have a touchscreen function.

The touchscreens need to have high-endurance capacities

as they are used by the general public and are often located outdoors, such that these screens must withstand weathering.

products are particularly suited to use in these machines as they are highly durable.

in the industrial sector have broad application, and play an important role in industrial HMI.

Industrial HMI systems and equipment

often require touchscreen functions.

ATM Machines and Other Financial Machines

ATMs and other similar machines use touchscreens or have a touchscreen function.

The touchscreens need to have high-endurance capacities as they are used by the general public and are often located outdoors, such that these screens must withstand weathering.

Our products are particularly suited to use in these machines as they are highly durable.

Industrial Equipment

Touchscreens in the industrial sector have broad application, and play an important role in industrial HMI.

Industrial HMI systems and equipment often require touchscreen functions.

These touchscreens must be resistant to interference, stable and have good touch sensitivity.

Our products fully meet these requirements, being temperature variation resistant, dustproof and waterproof.

new generation of gambling machines are commonly adopting a touchscreen function.

Gaming machines with a touchscreen function provide

an enhanced experience for uses via multi-touch sensory touch systems.

Our products are therefore popular amongst gambling

machine manufacturers.

self-service lottery ticket vending machine is provided with an operator-oriented touch display device, an input device, a modem,

a cash register, printer and security authentication function.

The touchscreen display facilitates easy and user-friendly operation

of the lottery machine.

Machines and Kiosks

ticket machines and kiosks contain touchscreen interfaces which are durable and have a long use life.

These self-service machines

are used in daily lives, and as such there is a continuous demand for high quality and effective touchscreens.

are widely used in these ticketing machines and kiosks.

the year ended December 31, 2023, we had approximately $9.8 million in revenues generated from the sales of automotive touchscreens,

accounting for 24.6% of our total revenues, with industrial HMI touchscreens accounting for 19.9%, POS touchscreens for 16.7%, gaming

touchscreens accounting for 14.2%, medical touchscreens for 14.6%, and multi-functional printer touchscreens for 10.1%, of our total

For the year ended December 31, 2022, we had approximately $9.3 million in revenues generated from the sales of automotive

touchscreens, accounting for 24.5% of our total revenues, with industrial HMI touchscreens accounting for 21.1%, POS touchscreens for

6.6%, gaming touchscreens accounting for 5.2%, multi-functional printer touchscreens for 3.8%, of our total revenues.

have six and six customers each accounting for more than 10% of our revenues for the year ended December 31, 2023 and 2022,

respectively.

the year ended December 31, 2023, our top five customers, namely (1) Siemens Industrial Automation Products (Chengdu) Co., Ltd., (2)

Shanghai Sigang Electronics Co., Ltd., (3) E-Lead Electronic Co.

Ltd., (4) MultimediaLink Inc., and (5) Suzhou Weinview Co., Ltd.,

accounted for approximately 22.5%, 16.5%, 15.7%, 14.1% and 11.3%, respectively, of our total revenues.

the year ended December 31, 2022, our top six customers, namely (1) Siemens Industrial Automation Products (Chengdu) Co., Ltd., (2)

Shanghai Sigang Electronics Co., Ltd., (3) E-Lead Electronic Co.

Ltd., (4) MultimediaLink Inc., (5) Suzhou Weinview Co., Ltd., and

(6) Canon (Suzhou) Ltd.

accounted for approximately 21.2%, 16.1%, 14.8%, 13.7%, 11.9% and 10.1%, respectively, of our total

Sichuan Wetouch’s business and operations have been assumed by Sichuan Vtouch, Sichuan Vtouch entered into sales framework

agreements, which were entered into by Sichuan Wetouch previously, with our top customers on December 31, 2021.

terms of the sales framework agreements with our top five customers provide:

term of each sales framework agreement is four years, which may be renewed by a separate agreement upon expiration.

The customer shall purchase an annual

minimum purchase amount for period from January 1 to December 31 each year as specified in the agreement.

If the customer fails to purchase the minimum purchase amount in the applicable agreement,

the customer will be deprived of the most favorable price treatment for the following year and rebate rewards for the current year.

will send the price list to the customers at the beginning of each year.

The specific execution price is subject to the order signed

by the parties.

have the right to adjust the price due to the market or other factors.

When there is any adjustment, we shall send a written notice

of such adjustment with 30 days in advance.

Upon receipt of this notice, the customer may choose to accept the price adjustment or

terminate the sales frame agreement.

the first year, we grant the customers a credit limit of $1.5 million and a credit term of 3 months.

During supply, the portion of

payment that exceeds the credit line shall be paid before goods are delivered.

In the next year, the credit will be increased according

to the sales of the previous year, which shall be subject to the negotiation of both parties.

customers shall make payment in full and on time according to the payment method and time of the purchase order and shall not delay

or refuse to pay.

If the customers fail to make payment within the agreed period of the purchase order and still fail to make payment

after being urged by us, we may stop the supply and have the right to demand payment of a late fee of 0.3% of the contract amount

per day from the customers;

If the customers still refuse to make payment after 30 days of notice from us, we have the right to file

a lawsuit with the court.

Gaming Machines

The new generation of gambling machines are commonly adopting a touchscreen function.

Gaming machines with a touchscreen function provide an enhanced experience for uses via multi-touch sensory touch systems.

Our products are therefore popular amongst gambling machine manufacturers.

Lottery Machines

The self-service lottery ticket vending machine is provided with an operator-oriented touch display device, an input device, a modem, a cash register, printer and security authentication function.

The touchscreen display facilitates easy and user-friendly operation of the lottery machine.

Ticket Machines and Kiosks

Self-service ticket machines and kiosks contain touchscreen interfaces which are durable and have a long use life.

These self-service machines are used in daily lives, and as such there is a continuous demand for high quality and effective touchscreens.

Our products are widely used in these ticketing machines and kiosks.

For the year ended December

31, 2024, we had approximately $11.5 million in revenues generated from the sales of automotive touchscreens, accounting for 27.2% of

our total revenues, with industrial HMI touchscreens accounting for 19.4%, gaming touchscreens for 15.3%, medical touchscreens for 14.9%,

POS touchscreens for 14.8%, and multi-functional printer touchscreens for 8.4%, respectively, of our total revenues.

For the year ended December

31, 2023, we had approximately $9.8 million in revenues generated from the sales of automotive touchscreens, accounting for 24.6% of our

total revenues, with industrial HMI touchscreens accounting for 19.9%, POS touchscreens for 16.7%, gaming touchscreens accounting for

14.1%, medical touchscreens for 14.6%, and multi-functional printer touchscreens for 10.1%, respectively, of our total revenues.

Our Customers

sound customer base is critical to our success.

We had five and six customers, each accounting for more than 10% of our revenues,

for the years ended December 31, 2024 and 2023, respectively.

For the year ended December

31, 2024, each of our top five customers accounted for approximately 22.0%, 19.1%, 15.3%, 14.5% and 11.5%of our total revenues, representing

82.4% in the aggregate.

For the year ended December

31, 2023, each of our top six customers accounted for approximately 22.5%, 16.5%, 15.6%, 14.1%, 11.3% and 10.1% of our total revenues,

representing 90.1% in the aggregate.

As Sichuan Wetouch’s

business and operations have been assumed by Sichuan Vtouch, Sichuan Vtouch entered into sales framework agreements, which were entered

into by Sichuan Wetouch previously with our top customers on December 31, 2021.

The material terms of the sales framework agreements with

our top customers provide:

The term of each sales framework agreement is four years, which may be renewed by a separate agreement upon expiration.

The customer shall purchase an annual minimum purchase amount for period from January 1 to December 31 each year as specified in the agreement.

If the customer fails to purchase the minimum purchase amount in the applicable agreement, the customer will be deprived of the most favorable price treatment for the following year and rebate rewards for the current year.

We will send the price list to the customers at the beginning of each year.

The specific execution price is subject to the order signed by the parties.

We have the right to adjust the price due to the market or other factors.

When there is any adjustment, we shall send a written notice of such adjustment with 30 days in advance.

Upon receipt of this notice, the customer may choose to accept the price adjustment or terminate the sales frame agreement.

For the first year, we grant the customers a credit limit of $1.5 million and a credit term of 3 months.

During supply, the portion of payment that exceeds the credit line shall be paid before goods are delivered.

In the next year, the credit will be increased according to the sales of the previous year, which shall be subject to the negotiation of both parties.

The customers shall make payment in full and on time according to the payment method and time of the purchase order and shall not delay or refuse to pay.

If the customers fail to make payment within the agreed period of the purchase order and still fail to make payment after being urged by us, we may stop the supply and have the right to demand payment of a late fee of 0.3% of the contract amount per day from the customers;

If the customers still refuse to make payment after 30 days of notice from us, we have the right to file a lawsuit with the court.

The customers shall bear the litigation costs, lawyer’s fees, and other debt recovery costs.

are required to provide products to customers pursuant to the delivery date and quantity, requirements included in the purchase orders

and shall negotiate with customers if we are unable to so provide.

customers are entitled to compensation of losses due to our failure to provide after-sale services.

violation of the terms of the agreements may result in the termination of the agreements and the breaching party shall be responsible

for all business and economic losses and legal liabilities arising therefrom.

do not typically enter into sales framework agreements with other customers but sell products to them through purchase orders.

key terms of our purchase order typically include the following:

product name, specification, quantity, price, order amount and delivery date are specified in each order.

method and packaging requirements are specified in each order

terms are specified in each order.

of order terms by customers in some orders.

terms in some orders.

Vtouch is obligated to provide 1) products per the specific requirements of the orders, and 2) unconditional defect warranty for our

We are required to provide products to customers pursuant to the delivery date and quantity, requirements included in the purchase orders and shall negotiate with customers if we are unable to so provide.

The customers are entitled to compensation of losses due to our failure to provide after-sale services.

Any violation of the terms of the agreements may result in the termination of the agreements and the breaching party shall be responsible for all business and economic losses and legal liabilities arising therefrom.

We do not typically enter into

sales framework agreements with other customers but sell products to them through purchase orders.

The key terms of our purchase order typically include

the following:

The product name, specification, quantity, price, order amount and delivery date are specified in each order.

Delivery method and packaging requirements are specified in each order

Payment terms are specified in each order.

Breach of order terms by customers in some orders.

Guaranty terms in some orders.

Sichuan Vtouch is obligated

to provide 1) products per the specific requirements of the orders, and 2) unconditional defect warranty for our products generally for

a term of one year.

Any violation of the order terms may result in termination of the orders or replacement of our products.

the years ended December 31, 2023 and 2022, we did not provide any extended payment terms to any of our customers.

Our customers are

required to make full payment within three to six months from the delivery date.

As a result of the COVID-19 outbreak in January 2020, collection activities from some of our customers affected by the

pandemic resulted in longer payment terms.

and Marketing

source our customers through multiple channels:

(i) from our own research through Search Engine Optimization (“SEO”) and

outreach, (ii) through referrals from our present customers, (iii) through our websites, which provide product information for sale,

as well as telephone and email contact information;

and (iv) through industry exhibitions/expos.

main target markets are economically developed countries and regions, including eastern, southern, northern and southwest regions of

Mainland China, South Korea, and Germany.

We believe that we have established a strong client base, including global well-known institutional

Overseas sales were approximately $12.1 million in 2023 as compared to $11.5 million in 2022.

target these overseas customers mainly via our online marketing efforts.

In order to market our products, occupy more market share and

secure more quality customers, we frequently participate in, and promote our products at, specific touchscreen technology exhibitions

held internationally.

products are produced to order and are marketed directly by our own sales personnel.

We do not rely on distributors to sell our

the year ended December 31, 2023, the revenues generated from our domestic customers amounted to approximately $27.6 million,

constituting approximately 69.6% of our total revenues, with overseas customers accounting for approximately $12.1 million, constituting approximately 30.4% of our total revenues, respectively.

ended December 31, 2022, the revenues generated from our domestic customers amounted to approximately $26.4 million,

constituting approximately 69.7% of our total revenues, with overseas customers accounting for approximately $11.5 million, constituting approximately 30.3% of our total revenues, respectively.

Sichuan Vtouch does not typically enter into supply agreements with our suppliers.

We can utilize any supplier we determine and there are no minimum

purchase requirements when we place orders with our suppliers.

place purchase orders with suppliers of raw materials for the production of our products.

The general terms of the purchase order include

specifications for product name, quantity, price, order amount, and delivery date, as well as delivery methods, packaging, inspection

procedures, breach terms, and dispute resolution, all tailored to each order.

For the years ended December

31, 2024 and 2023, we did not provide any extended payment terms to any of our customers.

Our customers are required to make full payment

within three to six months from the delivery date.

Sales and Marketing

We source our customers through

multiple channels:

(i) our own research through Search Engine Optimization (“SEO”) and outreach, (ii) referrals from our existing

customers, (iii) our websites, which provide product information for sale, as well as telephone and email contact information;

industry exhibitions/expos.

Our main target markets are

economically developed countries and regions, including Eastern, Southern, Northern and Southwest Mainland China, Taiwan, South Korea,

We believe that we have established a strong client base, including globally well-known institutional customers.

sales were approximately $14.9 million in 2024 as compared to $12.1 million in 2023.

We target these overseas customers

mainly via our online marketing efforts.

In order to market our products, increase our market share, and secure more quality customers,

we frequently participate in, and promote our products at, specific touchscreen technology exhibitions held internationally.

Our products are produced

to order and are marketed directly by our own sales personnel.

We do not rely on distributors to sell our products.

For the year ended December

31, 2024, the revenue from our domestic customers accounted for approximately 64.7% of our total revenues, with overseas customers accounting

for approximately 35.3%of our total revenues.

For the year ended December

31, 2023, the revenue generated from our domestic customers accounted for approximately 69.7% of our total revenues, with overseas customers

accounting for approximately 30.3% of our total revenues.

Our Suppliers

Sichuan Vtouch does not typically

enter into supply agreements with suppliers.

We can utilize any supplier we choose, and there are no minimum purchase requirements for

We place purchase orders with

suppliers of raw materials for the production of our products.

The general terms of the purchase order include specifications for product

name, quantity, price, order amount, and delivery date, as well as delivery methods, packaging, inspection procedures, breach terms, and

dispute resolution, all tailored to each order.

Payment terms are also specified in each order.

Additionally,

all products must meet nationally or industry-prescribed quality standards, with each order requiring a supplier’s quality certification.

The supplier must unconditionally accept returns and either refund the purchase price in full or provide replacements if the products

do not meet the required quality standards, are damaged, or significantly differ from what was ordered.

do not consider any of our suppliers to be material to our business and we can utilize any supplier we determine at our sole

Although we can utilize any supplier we determine, we believe that we have established healthy and stable relationships

with our significant suppliers.

We purchase our raw materials through various suppliers.

Raw material purchases from one and four suppliers, each

of which individually exceeded 10% of the Company’s total raw material purchases, accounted for approximately 13.3% and 47.2% of

the Company’s total raw material purchases for the year ended December 31, 2023 and 2022, respectively.

general terms of the purchase order include specifications for product name, quantity, price, order amount, and delivery date, as well

as delivery methods, packaging, inspection procedures, breach terms, and dispute resolution, all tailored to each order.

Payment terms

are also defined per order.

Additionally, all products must meet nationally or industry-prescribed quality standards, with each order

requiring a supplier’s quality certification.

The supplier must unconditionally accept returns and either refund the purchase price

in full or provide replacements if the products do not meet the required quality standards, are damaged, or significantly differ from

what was ordered.

Additionally, all products must meet nationally

or industry-prescribed quality standards, with each order requiring a supplier’s quality certification.

The supplier must unconditionally

accept returns and either refund the purchase price in full or provide replacements if the products do not meet the required quality standards,

are damaged, or significantly differ from what was ordered.

We do not consider any of

our suppliers to be material to our business, and we can utilize any supplier we choose at our sole discretion.

Although we can utilize

any supplier, we believe that we have established healthy and stable relationships with our significant suppliers.

We purchase our raw materials

through various suppliers.

For the year ended December 31, 2024, our top three suppliers, the only suppliers from whom our purchases individually

exceeded 10% of our total raw material purchases, accounted for approximately 15.5%, 12.2% and 11.5%, respectively.

ended December 31, 2023, our top one supplier, the only supplier from whom our purchases individually exceeded 10% of our total raw material

purchases, accounted for approximately 13.3%.

The general terms of the purchase

order include specifications for product name, quantity, price, order amount, and delivery date, as well as delivery methods, packaging,

inspection procedures, breach terms, and dispute resolution, all tailored to each order.

Payment terms are also specified in each order.

Additionally, all products must meet nationally or industry-mandated quality standards, with each order requiring a supplier’s quality

certification.

The supplier must unconditionally accept returns and either refund the purchase price in full or provide replacements if

the products do not meet the required quality standards, are damaged, or significantly differ from what was ordered.

Production and Quality Control

Company has adopted a made-to-order production model as follows:

process is subject to continuous review and monitoring by the management team in consultation with engineers, electricians and other

technical experts to ensure that finished products are of the highest quality and meet customer requirements and ISO9001 Quality Management

Systems (QMS) standard.

order to maintain product safety and a high standard of product quality, the Company implements a strict set of quality control policies

and inspection protocols.

These policies and protocols are enforced by the Company’s senior management and officers along every

step of the production to post-production process.

The Company has adopted a

made-to-order production model as follows:

This process is subject to

continuous review and monitoring by the management team in consultation with engineers, electricians and other technical experts to ensure

that finished products are of the highest quality and meet customer requirements and ISO9001 Quality Management Systems (QMS) standards.

In order to maintain product

safety and a high standard of product quality, the Company implements a strict set of quality control policies and inspection protocols.

These policies and protocols are enforced by the Company’s senior management and officers through every stage of the production

to post-production process.

Their management guidelines along with key company quality policies are set out below:

Company has strict production standards in place that govern what constitutes acceptable quality for its products.

This ensures that

the Company’s products fulfill product certification standards.

The production team adheres to the following criteria when making

its product standard assessment:

than or equal to 5 milliseconds

The Company has strict production

standards in place that govern what constitutes acceptable quality for its products.

This ensures that the Company’s products meet

product certification standards.

The production team adheres to the following criteria when assessing product standards:

Industry Standards

Our Standards

Reaction time

Less than or equal to 5 milliseconds

Surface hardness

Operational temperature

0~70 degrees Celsius

-30~80 degrees Celsius

touch and ordinary conditions

and anti-saline solution and anti-corrosion and Anti interference

products are inspected before they are delivered to our customers.

EsD requirement

Touch conditions

Normal touch and ordinary conditions

Waterproof and anti-saline solution and anti-corrosion and Anti interference

The products are inspected

before they are delivered to our customers.

All products must pass the following inspections:

Cosmetic inspection:

conducted under optimum temperatures (20-22 degrees Celsius) and white fluorescent lighting.

The product is observed

by the naked eye to spot for any defects, scratches and cracks, panel discoloration, opacity, foreign fibers and spots.

has in place quantitative standards with respect to each of these areas to determine the level of cosmetic acceptability.

The product is observed by the naked eye to detect any defects, scratches and cracks, panel discoloration, opacity, foreign fibers and spots.

The Company maintains quantitative standards with respect to each of these areas to determine the level of cosmetic acceptability.

Function tests:

all products undergo functionality testing.

Touchscreen products are connected electronically via standard cabling systems

to computers, to measure and test for effective functionality and to screen for any abnormalities.

all products undergo product stress testing by being subject to humidity, temperature and corrosion stress testing.

products are tested for their functionality in high and low humidity environments as well as in extreme temperatures.

are inspected to determine whether damage or physical change is caused by exposure to high and low temperatures.

Internal teams will conduct independent testing for hazardous substances.

The products are also tested for their corrosive

resistance to saline solutions.

is no significant seasonality in our business.

and Development

are committed to our own research and development projects as well as partnership initiatives in order to continuously and systematically

upgrade our touchscreen technology.

As of the date of this Annual Report, we have 11 employees in our R&D department.

business is dependent on a combination of trademarks, patents, domain names, trade names, trade secrets and other proprietary rights

in order to protect our intellectual property rights.

As of the date of this Annual Report, Sichuan Vtouch has one registered trademark in Mainland

China and five pending patent applications.

forth below is a detailed description of our current trademark:

Application Number

Sichuan Vtouch has applied for five patents with the Patent Office of China National Intellectual Property Administration.

As of the date of this Annual Report, the patent applications are still pending.

forth below is a detailed description of our pending patent applications:

Application No.

Touchscreen products are connected electronically via standard cabling systems to computers, to measure functionality and identify abnormalities.

Stress testing:

all products undergo stress testing for humidity, temperature, and corrosion resistance The products are tested for functionality in high- and low-humidity environments as well as extreme temperatures to determine whether exposure causes damage or physical change.

Hazardous substances testing:

internal teams conduct independent testing for hazardous substances and for corrosive resistance to saline solutions.

There is no significant seasonality

in our business.

Research and Development (“R&D”)

We are committed to both internal

R&D projects and collaborative initiatives to continuously upgrade our touchscreen technology.

As of the date of this Annual Report,

we have 11 employees in our R&D department, all of whom obtained at least a bachelor’s

degree, with average R&D work experience of at least three years.

For the years ended December 31, 2024 and 2023, our R&D expenses

were approximately $nil and $84,551, respectively .

the future, we expect R&D expenses to increase as we continue to accelerate the development of new products and functions, and to

enhancing and upgrading existing products and functions.

Intellectual Property

Our business relies on a combination

of trademarks, patents, domain names, trade names, trade secrets and other proprietary rights to protect our intellectual property.

of the date of this Annual Report, Sichuan Vtouch has one registered trademark in Mainland China and five pending patent applications.

Set forth below is a detailed

description of our current trademark:

Application Date

Registration Number

Registration Date

Assignment Application Number

Sichuan Vtouch

Sichuan Vtouch has applied

for five patents with the Patent Office of China National Intellectual Property Administration.

As of the date of this Annual Report,

the five patent applications are still pending.

Patents registered in Mainland China cannot be enforced in other jurisdictions to which

the Company supplies its products.

Set forth below is a detailed

description of our pending patent applications:

Patent Application No.

Patent Application

Patent Applicant

202120500187.7

cost anti-rupture projected capacitive touchscreen

Low cost anti-rupture projected capacitive touchscreen

Utility Model

Sichuan Vtouch

202120500188.1

performance and anti-electromagnetic radiation projected capacitive touchscreen

High performance and anti-electromagnetic radiation projected capacitive touchscreen

Utility Model

Sichuan Vtouch

202120500155.7

Full-lamination

projected capacitive touchscreen

Full-lamination projected capacitive touchscreen

Utility Model

Sichuan Vtouch

202110256476.1

glass structure capacitive touchscreen

Anti-scratch glass structure capacitive touchscreen

Sichuan Vtouch

202111206650.8

enhanced anti-static projection capacitive screen

registered in Mainland China cannot be enforced in other jurisdictions to which the Company supplies its products.

We currently have

pending patent applications only in Mainland China.

We plan to submit patent registration applications in our target market jurisdictions including

United States, Europe, Australia, Japan, Korea, Taiwan, India and Russia by the end of 2024.

Environmental

business in Mainland China is subject to various pollution control regulations in Mainland China with respect to noise, water and air

pollution and the disposal of waste.

Specifically, the major environmental regulations applicable to us include the PRC Environmental

Protection Law, the PRC Law on the Prevention and Control of Water Pollution, the PRC Law on the Prevention and Control of Air Pollution,

the PRC Law on the Prevention and Control of Solid Waste Pollution, and the PRC Law on the Prevention and Control of Noise Pollution.

Vtouch originally received the Pollutant Discharge Permit from Renshou County environmental protection agency, which expired on May 15,

Pursuant to a Statement on Change of Pollutant Discharge Permit to Stationary Pollution Source Registration Form dated September

1, 2020, the environmental protection system in Renshou County, Sichuan, was changed from permission to registration due to local administrative

division change.

Sichuan Vtouch is registered under the new system by the issuance

of the Stationary Pollution Source Registration Form as of the date of this Annual Report .

Company is not aware of any investigations, prosecutions, disputes, claims or other proceedings in respect of environmental protection,

nor has the Company been punished or can foresee any punishment to be made by any environmental administration authorities of the PRC.

An enhanced anti-static projection capacitive screen

Sichuan Vtouch

Environmental Matters

Our business in Mainland China

is subject to various pollution control regulations in Mainland China with respect to noise, water and air pollution and the disposal

Specifically, the major environmental regulations applicable to us include the PRC Environmental Protection Law, the PRC Law

on the Prevention and Control of Water Pollution, the PRC Law on the Prevention and Control of Air Pollution, the PRC Law on the Prevention

and Control of Solid Waste Pollution, and the PRC Law on the Prevention and Control of Noise Pollution.

Pursuant to a Statement on

Change of Pollutant Discharge Permit to Stationary Pollution Source Registration Form dated September 1, 2020, the environmental protection

system in Renshou County, Sichuan, was changed from permission to registration due to local administrative division change.

Sichuan Vtouch

is currently registered under the new system and holds the Stationary Pollution Source Registration Form as of the date of this Annual

The Company is not aware of

any investigations, prosecutions, disputes, claims or other proceedings relating to environmental protection, nor has the Company been

punished or foresees any punishment from any environmental administration authorities of the PRC.

markets for touchscreen products are highly competitive and subject to rapid technological change.

4 unchanged sentences

respect to these factors, although there can be no assurance that the Company will be able to continue to compete successfully in the

that touchscreen products are highly competitive as a whole, we face fewer competitors, as we produce medium to large size touchscreens

which are specially tailored to certain industries, such as industrial HMI, gaming, financing, lottery, automotive, medical, and POS,

among others, and require more stable supply and longer guaranty and life span, compared with small size touchscreens, which are characterized

by shorter life cycles and guaranty but more demand in quantity.

believe the following companies may be our competitors:

Material Technology Corp., founded in 1998, is committed to the development and innovation of resistive and projected capacitive

(PCI or PCAP) total touch solutions.

With its headquarters based in Keelung, Taiwan and a subsidiary located in Milwaukee, Wisconsin,

it designs and manufactures advanced high-performance touch products for industrial and medical applications.

Compared with us, although

it has a longer history and geographical advantages, it mainly focuses on resistive touch panels and recently started production

of capacitive touchscreens mostly applicable to the industrial HMI and medical industries, while our products are more widely used

in a variety of industries.

Touch Systems Inc., based and headquartered in the United States, has a history of over 40 years in the production of touchscreens.

Its product portfolio includes a broad selection of interactive touchscreen displays from 10-70 inches, all-in-one touchscreen computers,

OEM touchscreens and touchscreen controllers and touchscreen monitors.

Compared with us, although it has a longer history and geographical

advantages when it comes to the competition for U.S.

customers and other international customers, it recently started the production

of capacitive touchscreens mostly applicable to POS and inquiry machines, while our products are more widely used in a variety of

System Inc, established in 2005, mainly focuses on manufacturing and sales of mid to large size (7”~86”) “Projective

Capacitive Sensors,” (7”~21.5”) “Five-Wire Resistive Zero-Bezel Touch Panels” and (5”~21.5”)

“Five-Wire Resistive Touch Panels.” Compared with us, although it has a longer history and geographical advantages, it

mainly focuses on resistive touch panels and recently started production of capacitive touchscreens mostly applicable to POS, inquiry

machines and industrial HMI, while our products are more widely used in a variety of industries.

inception, we have positioned ourselves in the professional touchscreen display industry.

Touchscreen is an input and output device and

layered on top of an electronic visual display of an information processing system, allowing individuals to access information and interact

with the device simply by touching the device’s screen with a finger or a specialized tool.

Accordingly, the ease of use offered

by touchscreen-based systems makes the systems well suited both for applications for the general public and for specialized applications

for institutional users and trained computer users.

touchscreen has become mainstream only over the last decade, the concept of a touch-sensitive computer display was developed as early

Since the introduction of Apple’s iPhone in 2007, touchscreen technology has made rapid inroads into various electronics

markets, with a number of other significant companies also incorporating this technology into their products (as opposed to using a mouse,

keyboard, keypad or trackball).

Viewed today as the most important tool to facilitate interaction between the individual and machine,

touchscreen technology is now an integral part of a wide range of computing products.

operate our business in Mainland China under a legal regime consisting of the National People’s Congress, which is the country’s

highest legislative body, the State Council, which is the highest authority of the executive branch of the PRC central government, and

several ministries and agencies under its authority, including the Ministry of Industry and Information Technology, the State Administration

for Market Regulation (“SAMR”) and their respective local offices.

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

Relating to Foreign Investment in Mainland China

March 15, 2019, the National People’s Congress promulgated the Foreign Investment Law, which came into effect on January 1, 2020

and replaced three existing laws on foreign investments in China, namely, the PRC Equity Joint Venture Law, the PRC Cooperative Joint

Venture Law, and the Wholly Foreign-Owned Enterprise Law, together with their implementation rules and ancillary regulations.

Investment Law embodies an expected Mainland China regulatory trend to rationalize its foreign investment regulatory regime in line with

prevailing international practice and the legislative efforts to unify the corporate legal requirements for both foreign- and domestic-invested

enterprises in Mainland China.

The Foreign Investment Law establishes the basic framework for the access to, and the promotion, protection,

and administration of foreign investments in view of investment protection and fair competition.

to the Foreign Investment Law, “foreign investment” refers to investment activities directly or indirectly conducted by one

or more natural persons, business entities, or otherwise organizations of a foreign country within Mainland China, or foreign investors,

and the investment activities include the following situations:

(i) a foreign investor, individually or collectively with other investors,

establishes an Foreign Investment Entity (“FIE”) in Mainland China;

(ii) a foreign investor acquires stock shares, equity

shares, shares in assets, or other similar rights and interests of an enterprise within Mainland China;

(iii) a foreign investor, individually

or collectively with other investors, invests in a new project in Mainland China;

and (iv) investments in other means as provided by

laws, administrative regulations, or the State Council.

activities in Mainland China by foreign investors are principally governed by the Guidance Catalogue of Industries for Foreign Investment ,

or the Catalogue, which was promulgated and is amended from time to time by the Ministry of Commerce, or the MOFCOM, and the National

Development and Reform Commission, or the NDRC.

Despite touchscreen products

being highly competitive as a whole, we face fewer competitors, because we produce medium- to large-sized touchscreens specially tailored

to certain industries, such as industrial HMI, gaming, financial services, lottery, automotive, medical, and POS, among others, and that

require more stable supply and longer guaranty and life span, compared with small size touchscreens, which are characterized by shorter

life cycles and guaranty but more demand in quantity.

We believe the following companies

may be our competitors:

Apex Material Technology Corp., founded in 1998, is committed to the development and innovation of resistive and projected capacitive (PCI or PCAP) total touch solutions.

With its headquarters in Keelung, Taiwan and a subsidiary located in Milwaukee, Wisconsin, it designs and manufactures advanced high-performance touch products for industrial and medical applications.

Compared with us, although it has a longer history and geographical advantages, it mainly focuses on resistive touch panels and recently started production of capacitive touchscreens primarily for the industrial HMI and medical industries, while our products are more widely used in a variety of industries.

Elo Touch Systems Inc., based and headquartered in the United States, has a history of over 40 years in the production of touchscreens.

Its product portfolio includes a broad selection of interactive touchscreen displays from 10-70 inches, all-in-one touchscreen computers, OEM touchscreens and touchscreen controllers and touchscreen monitors.

Compared with us, although it has a longer history and geographical advantages in competing for U.S.

customers and other international customers, it recently started the production of capacitive touchscreens primarily for POS and inquiry machines, while our products are more widely used in a variety of industries.

AbonTouch System Inc, established in 2005, mainly focuses on manufacturing and sales of mid to large size (7“~86”) “Projective Capacitive Sensors,” (7“~21.5”) “Five-Wire Resistive Zero-Bezel Touch Panels” and (5“~21.5”) “Five-Wire Resistive Touch Panels.” Compared with us, although it has a longer history and geographical advantages, it mainly focuses on resistive touch panels and recently started production of capacitive touchscreens primarily for POS, inquiry machines and industrial HMI, while our products are more widely used in a variety of industries.

Since inception, we have

positioned ourselves in the professional touchscreen display industry.

A touchscreen is an input and output device and layered on top

of an electronic visual display of an information processing system, allowing individuals to access information and interact with the

device simply by touching the device’s screen with a finger or a specialized tool.

Accordingly, the ease of use offered by touchscreen-based

systems makes them well suited for both applications for the general public and for specialized applications for institutional users and

trained computer users.

Although touchscreens have

become mainstream only over the last decade, the concept of a touch-sensitive computer display was developed as early as 1965.

introduction of Apple’s iPhone in 2007, touchscreen technology has made rapid inroads into various electronics markets, with a number

of other significant companies also incorporating this technology into their products (as opposed to using a mouse, keyboard, keypad or

Viewed today as the most important tool to facilitate interaction between individuals and machines, touchscreen technology

is now an integral part of a wide range of computing products.

We operate our business in

Mainland China under a legal regime consisting of the National People’s Congress, which is the country’s highest legislative

body, the State Council, which is the highest authority of the executive branch of the PRC central government, and several ministries

and agencies under its authority, including the Ministry of Industry and Information Technology, the State Administration for Market Regulation

(“SAMR”) and their respective local offices.

This section sets forth a

summary of the most significant rules and regulations that affect our business activities in Mainland China.

Regulations Relating to Foreign Investment

in Mainland China

On March 15, 2019, the National

People’s Congress promulgated the Foreign Investment Law, which came into effect on January 1, 2020 and replaced three existing

laws on foreign investments in China, namely, the PRC Equity Joint Venture Law, the PRC Cooperative Joint Venture Law, and the Wholly

Foreign-Owned Enterprise Law, together with their implementation rules and ancillary regulations.

The Foreign Investment Law embodies

an expected Mainland China regulatory trend to rationalize its foreign investment regulatory regime in line with prevailing international

practice and the legislative efforts to unify the corporate legal requirements for both foreign- and domestic-invested enterprises in

Mainland China.

The Foreign Investment Law establishes the basic framework for the access to, and the promotion, protection, and administration

of foreign investments in view of investment protection and fair competition.

Pursuant to the Foreign Investment

Law, “foreign investment” refers to investment activities directly or indirectly conducted by one or more natural persons,

business entities, or otherwise organizations of a foreign country within Mainland China, or foreign investors, and the investment activities

include the following situations:

(i) a foreign investor, individually or collectively with other investors, establishes an Foreign Investment

Entity (“FIE”) in Mainland China;

(ii) a foreign investor acquires stock shares, equity shares, shares in assets, or other

similar rights and interests of an enterprise within Mainland China;

(iii) a foreign investor, individually or collectively with other

investors, invests in a new project in Mainland China;

and (iv) investments in other means as provided by laws, administrative regulations,

or the State Council.

Investment activities in Mainland

China by foreign investors are principally governed by the Guidance Catalogue of Industries for Foreign Investment , or the Catalogue,

which was promulgated and is amended from time to time by the Ministry of Commerce, or the MOFCOM, and the National Development and Reform

Commission, or the NDRC.

Restricted and prohibited industries are listed in the Catalogue.

The Catalogue sets

out a unified basis for the special administrative measures for foreign investment access.

Fields not mentioned in the list for foreign

investment access, including touchscreen manufacturing, are administered under the principle of equal treatment for domestic and foreign

not listed in the Catalogue are generally deemed as constituting a “permitted” category.

According to the Catalogue, touchscreen

manufacturing is classified as industry where foreign investments are permitted.

the Foreign Investment Law provides that FIEs established according to the existing laws regulating foreign investment may maintain their

structure and corporate governance within five years after the implementation of the Foreign Investment Law.

addition, the Foreign Investment Law also provides several protective rules and principles for foreign investors and their investments

in Mainland China, including, among others, that local governments must abide by their commitments to the foreign investors;

allowed to issue stocks and corporate bonds;

expropriation or requisition of the investment of foreign investors is prohibited except

for special circumstances, in which case statutory procedures must be followed and fair and reasonable compensation must be made in a

timely manner;

mandatory technology transfer is prohibited;

and the capital contributions, profits, capital gains, proceeds out of asset

disposal, licensing fees of intellectual property rights, indemnity or compensation legally obtained, or proceeds received upon settlement

by foreign investors in Mainland China may be freely remitted inward and outward in Renminbi or foreign currencies.

Also, foreign investors

or FIEs should be imposed legal liabilities for failing to report investment information in accordance with the requirements.

December 26, 2019, the PRC State Council approved the Implementation Rules of Foreign Investment Law, which came into effect on January

The Implementation Rules of Foreign Investment Law restates certain principles of the Foreign Investment Law and further provides

that, among others, (i) if the legal form or the governing structure of an FIE established prior to the effective date of the Foreign

Investment Law does not comply with the compulsory provisions of the PRC Company Law or the PRC Partnership Enterprises Law, such FIE

should complete amendment registration accordingly no later than January 1, 2025;

if it fails to do so, the enterprise registration authority

will not process other registration matters of the FIE and may publicize such non-compliance;

and (ii) the provisions regarding transfer

of equity interests, distribution of profits and remaining assets as stipulated in the joint venture contracts of an existing FIE may

survive the Foreign Investment Law during its joint venture term.

The Catalogue sets out a unified basis for

the special administrative measures for foreign investment access.

Fields not mentioned in the list for foreign investment access, including

touchscreen manufacturing, are administered under the principle of equal treatment for domestic and foreign capital.

Industries not listed in the

Catalogue are generally deemed as constituting a “permitted” category.

According to the Catalogue, touchscreen manufacturing

is classified as industry where foreign investments are permitted.

Furthermore, the Foreign Investment

Law provides that FIEs established according to the existing laws regulating foreign investment may maintain their structure and corporate

governance within five years after the implementation of the Foreign Investment Law.

In addition, the Foreign Investment

Law also provides several protective rules and principles for foreign investors and their investments in Mainland China, including, among

others, that local governments must abide by their commitments to the foreign investors;

FIEs are allowed to issue stocks and corporate

expropriation or requisition of the investment of foreign investors is prohibited except for special circumstances, in which case

statutory procedures must be followed and fair and reasonable compensation must be made in a timely manner;

mandatory technology transfer

is prohibited;

and the capital contributions, profits, capital gains, proceeds out of asset disposal, licensing fees of intellectual property

rights, indemnity or compensation legally obtained, or proceeds received upon settlement by foreign investors in Mainland China may be

freely remitted inward and outward in Renminbi or foreign currencies.

Also, foreign investors or FIEs should be imposed legal liabilities

for failing to report investment information in accordance with the requirements.

On December 26, 2019, the

PRC State Council approved the Implementation Rules of Foreign Investment Law, which came into effect on January 1, 2020.

The Implementation

Rules of Foreign Investment Law restates certain principles of the Foreign Investment Law and further provides that, among others, (i)

if the legal form or the governing structure of an FIE established prior to the effective date of the Foreign Investment Law does not

comply with the compulsory provisions of the PRC Company Law or the PRC Partnership Enterprises Law, such FIE should complete amendment

registration accordingly no later than January 1, 2025;

if it fails to do so, the enterprise registration authority will not process other

registration matters of the FIE and may publicize such non-compliance;

and (ii) the provisions regarding transfer of equity interests,

distribution of profits and remaining assets as stipulated in the joint venture contracts of an existing FIE may survive the Foreign Investment

Law during its joint venture term.

on Environmental Protection

Environmental

Protection Law

Environmental Protection Law of the PRC, or the Environmental Protection Law, was promulgated and effective on December 26, 1989,

and most recently amended on April 24, 2014, which amendments became effective January 1, 2015.

This Environmental Protection Law has

been formulated for the purpose of protecting and improving both the living environment and the ecological environment, preventing and

controlling pollution, other public hazards and safeguarding people’s health.

to the provisions of the Environmental Protection Law , in addition to other relevant laws and regulations of the PRC, the Ministry

of Environmental Protection and its local counterparts take charge of administering and supervising said environmental protection matters.

Pursuant to the Environmental Protection Law , the environmental impact statement on any construction project must assess the pollution

that the project is likely to produce and its impact on the environment, and stipulate preventive and curative measures;

the statement

shall be submitted to the competent administrative department of environmental protection for approval.

Installations for the prevention

and control of pollution in construction projects must be designed, built and commissioned together with the principal part of the project.

to commence production at or utilize any construction project shall not be granted until its installations for the prevention and control

of pollution have been examined and confirmed to meet applicable standards by the appropriate administrative department of environmental

protection that examined and approved the environmental impact statement.

Installations for the prevention and control of pollution shall

not be dismantled or left idle without authorization.

Where it is absolutely necessary to dismantle any such installation or leave it

idle, prior approval shall be obtained from the competent local administrative department of environmental protection.

Environmental Protection Law makes it clear that the legal liabilities of any violation of said law include warning, fine, rectification

within a time limit, compulsory cease operation, compulsory reinstallation of dismantled installations of the prevention and control

of pollution or compulsory reinstallation of those left idle, compulsory shutout or closedown, or even criminal punishment.

on Ecosystem by The Ministry of Ecology and Environment 2019 Classification-based Management on Fixed Pollutant Source

to the Order on Ecosystem by The Ministry of Ecology and Environment, which was issued on July 28, 2017 and most recently amended on

December 20, 2019, The Ministry of Ecology and Environment implements a classification-based management on the environmental impact assessment,

or EIA, of pollutants according to pollutant amount and the impact of the pollutants on the environment as below

those pollutant discharge units with large amount of pollutants and significant environmental impacts, the key management on a pollutant

discharge permit is required;

those pollutant discharge units with small amount of pollutants and small environmental impacts, the simplified management on a pollutant

discharge permit is required;

those pollutant discharge units with very small amount of pollutants and very small environmental impacts, the pollutant discharge

registration form is required.

touchscreen manufacturing is classified as to fill in a Registration Form.

Pursuant to a Statement on Change of Pollutant Discharge Permit

to Stationary Pollution Source Registration Form by the local government dated September 1, 2020, the environmental protection system

in Renshou County, Sichuan, was changed from permission to registration due to local administrative division change.

Therefore, upon

submission of all required documentation, we are registered under the new system by filling in Stationary Pollution Source Registration

on Consumer Rights Protection

business is subject to a variety of consumer protection laws, including the PRC Consumer Rights and Interests Protection Law, which was

amended in 2013 and became effective on March 15, 2014.

Environmental Protection

The Environmental Protection

Law of the PRC, or the Environmental Protection Law, was promulgated and effective on December 26, 1989, and most recently amended

on April 24, 2014, which amendments became effective January 1, 2015.

This Environmental Protection Law has been formulated for the purpose

of protecting and improving both the living environment and the ecological environment, preventing and controlling pollution, other public

hazards and safeguarding people’s health.

According to the provisions

of the Environmental Protection Law , in addition to other relevant laws and regulations of the PRC, the Ministry of Environmental

Protection and its local counterparts take charge of administering and supervising said environmental protection matters.

the Environmental Protection Law , the environmental impact statement on any construction project must assess the pollution that

the project is likely to produce and its impact on the environment, and stipulate preventive and curative measures;

the statement shall

be submitted to the competent administrative department of environmental protection for approval.

Installations for the prevention and

control of pollution in construction projects must be designed, built and commissioned together with the principal part of the project.

Permission to commence production

at or utilize any construction project shall not be granted until its installations for the prevention and control of pollution have been

examined and confirmed to meet applicable standards by the appropriate administrative department of environmental protection that examined

and approved the environmental impact statement.

Installations for the prevention and control of pollution shall not be dismantled or

left idle without authorization.

Where it is absolutely necessary to dismantle any such installation or leave it idle, prior approval

shall be obtained from the competent local administrative department of environmental protection.

The Environmental Protection

Law makes it clear that the legal liabilities of any violation of said law include warning, fine, rectification within a time limit,

compulsory cease operation, compulsory reinstallation of dismantled installations of the prevention and control of pollution or compulsory

reinstallation of those left idle, compulsory shutout or closedown, or even criminal punishment.

Order on Ecosystem by

The Ministry of Ecology and Environment 2019 Classification-based Management on Fixed Pollutant Source

Pursuant to the Order on Ecosystem

by The Ministry of Ecology and Environment, which was issued on July 28, 2017 and most recently amended on December 20, 2019, The Ministry

of Ecology and Environment implements a classification-based management on the environmental impact assessment, or EIA, of pollutants

according to pollutant amount and the impact of the pollutants on the environment as below

For those pollutant discharge units with large amount of pollutants and significant environmental impacts, the key management on a pollutant discharge permit is required;

For those pollutant discharge units with small amount of pollutants and small environmental impacts, the simplified management on a pollutant discharge permit is required;

For those pollutant discharge units with very small amount of pollutants and very small environmental impacts, the pollutant discharge registration form is required.

The touchscreen manufacturing

is classified as to fill in a Registration Form.

Pursuant to a Statement on Change of Pollutant Discharge Permit to Stationary Pollution

Source Registration Form by the local government dated September 1, 2020, the environmental protection system in Renshou County, Sichuan,

was changed from permission to registration due to local administrative division change.

Therefore, upon submission of all required documentation,

we are registered under the new system by filling in Stationary Pollution Source Registration Form.

Regulations on Consumer Rights Protection

Our business is subject to

a variety of consumer protection laws, including the PRC Consumer Rights and Interests Protection Law, which was amended in 2013 and became

effective on March 15, 2014.

It imposes stringent requirements and obligations on business operators.

to comply with these consumer protection laws could subject us to administrative sanctions, such as the issuance of a warning, confiscation

of illegal income, imposition of fines, an order to cease business operations, revocation of business licenses, and potential civil or

criminal liabilities.

of the date of this Annual Report, we are not aware of any warning, investigations, prosecutions, disputes, claims or other proceedings

in respect of customer rights protection, nor have we been punished or can foresee any punishment to be made by any government authorities

on Intellectual Property Rights

are protected by the PRC Trademark Law adopted in 1982 and subsequently amended as well as the Implementation Regulations for the Trademark

Law of the PRC in 2002 and subsequently amended in 2014 and 2019.

The Trademark Office of the SAMR is responsible for the registration

and administration of trademarks and the Trademark Review and Adjudication Committee established by the SAMR is responsible for resolving

trademark disputes in Mainland China.

Failure to comply with these consumer

protection laws could subject us to administrative sanctions, such as the issuance of a warning, confiscation of illegal income, imposition

of fines, an order to cease business operations, revocation of business licenses, and potential civil or criminal liabilities.

As of the date of this Annual

Report, we are not aware of any warning, investigations, prosecutions, disputes, claims or other proceedings in respect of customer rights

protection, nor have we been punished or can foresee any punishment to be made by any government authorities of the PRC.

Regulations on Intellectual Property Rights

Regulations on Trademark

Trademarks are protected by

the PRC Trademark Law adopted in 1982 and subsequently amended as well as the Implementation Regulations for the Trademark Law of the

PRC in 2002 and subsequently amended in 2014 and 2019.

The Trademark Office of the SAMR is responsible for the registration and administration

of trademarks and the Trademark Review and Adjudication Committee established by the SAMR is responsible for resolving trademark disputes

in Mainland China.

Registered trademarks are valid for ten years from the date the registration is approved.

may apply to renew a registration within twelve months before the expiration date of the registration.

If the registrant fails to apply

in a timely manner, a grace period of six additional months may be granted.

If the registrant fails to apply before the grace period

expires, the registered trademark shall be deregistered.

A registrant may apply to

renew a registration within twelve months before the expiration date of the registration.

If the registrant fails to apply in a timely

manner, a grace period of six additional months may be granted.

If the registrant fails to apply before the grace period expires, the

registered trademark shall be deregistered.

Renewed registrations are valid for ten years.

In April 2014, the State Council

issued the revised Implementation of the Trademark Law, which specified the requirements of applying for trademark registration and review.

As of the date of this Annual Report, we had 1 registered trademark in Mainland China.

on Patent Law

to the PRC Patent Law, which was issued by the Standing Committee of the National People’s Congress in 1984 and last amended on

October 17, 2020, effective on June 1, 2021, and Implementation Rules of the Patent Law of the People’s Republic of China, which

were promulgated by the State Council in 2001 and last amended on January 9, 2010.

Draft amendments to the Implementation Rules of the

Patent Law are currently under review.

In April 2014, the State Council issued the

revised Implementation of the Trademark Law, which specified the requirements of applying for trademark registration and review.

the date of this Annual Report, we had 1 registered trademark in Mainland China.

Regulations on Patent

According to the PRC Patent

Law, which was issued by the Standing Committee of the National People’s Congress in 1984 and last amended on October 17, 2020,

effective on June 1, 2021, and Implementation Rules of the Patent Law of the People’s Republic of China, which were promulgated

by the State Council in 2001 and last amended on January 9, 2010.

Draft amendments to the Implementation Rules of the Patent Law are currently

under review.

The Patent Law and its implementation rules provide for three types of patents:

“utility model” and “design.” “Invention” refers to any new technical solution relating to a product,

a process or improvement thereof;

“utility model” refers to any new technical solution relating to the shape, structure,

or their combination, of a product, which is suitable for practical use;

and “design” refers to any new design of the whole

or partial shape, pattern, color or the combination of any two of them, of a product, that creates an aesthetical feeling and is suitable

for industrial application.

Invention patents are valid for 20 years, while design patents and utility model patents are valid for 15

years and 10 years, respectively, each calculated from the date of application.

To be patentable, invention or utility models must meet

three criteria:

novelty, inventiveness and practicability.

Except under certain specific circumstances provided by law, any third-party

user must obtain consent or a proper license from the patent owner to use the patent.

Otherwise, the use constitutes an infringement

of the patent rights.

As of the date of this Annual Report, we had five pending patent applications.

on Foreign Exchange

Administration of Foreign Exchange

the PRC Foreign Currency Administration Rules promulgated on January 29, 1996 and most recently amended on August 5, 2008 and various

regulations issued by the SAFE, and other relevant PRC government authorities, Renminbi is convertible into other currencies for current

account items, such as trade-related receipts and payments and payment of interest and dividends.

The conversion of Renminbi into other

currencies and remittance of the converted foreign currency outside Mainland China for capital account items, such as direct equity investments,

loans, and repatriation of investment, requires the prior approval from the SAFE or its local office.

for transactions that take place in Mainland China must be made in Renminbi.

Unless otherwise approved, Mainland China companies may

not repatriate foreign currency payments received from abroad or retain the same abroad.

FIEs may retain foreign exchange in accounts

with designated foreign exchange banks under the current account items subject to a cap set by the SAFE or its local branch.

exchange proceeds under the current accounts may be either retained or sold to a financial institution engaged in settlement and sale

of foreign exchange pursuant to relevant SAFE rules and regulations.

For foreign exchange proceeds under the capital accounts, approval

from the SAFE is generally required for the retention or sale of such proceeds to a financial institution engaged in settlement and sale

“invention,” “utility

model” and “design.” “Invention” refers to any new technical solution relating to a product, a process or

improvement thereof;

“utility model” refers to any new technical solution relating to the shape, structure, or their combination,

of a product, which is suitable for practical use;

and “design” refers to any new design of the whole or partial shape, pattern,

color or the combination of any two of them, of a product, that creates an aesthetical feeling and is suitable for industrial application.

Invention patents are valid for 20 years, while design patents and utility model patents are valid for 15 years and 10 years, respectively,

each calculated from the date of application.

To be patentable, invention or utility models must meet three criteria:

novelty, inventiveness

and practicability.

Except under certain specific circumstances provided by law, any third-party user must obtain consent or a proper

license from the patent owner to use the patent.

Otherwise, the use constitutes an infringement of the patent rights.

As of the date of

this Annual Report, we had five pending patent applications.

Regulations on Foreign Exchange

General Administration

of Foreign Exchange

to the Circular of the SAFE on Notice of State Administration of Foreign Exchange on Further Improvements and Adjustments to Foreign

Exchange Control Policies for Direct Investment, which was promulgated on November 19, 2012, became effective on December 17, 2012, and

was further amended on May 4, 2015, October 10, 2018, and December 30, 2019, approval of the SAFE is not required for opening a foreign

exchange account and depositing foreign exchange into the accounts relating to the direct investments.

This circular also simplifies

foreign exchange-related registration required for foreign investors to acquire equity interests of PRC companies and further improve

the administration on foreign exchange settlement for FIEs.

Notice of the State Administration of Foreign Exchange on Further Simplifying and Improving the Foreign Exchange Management Policies

for Direct Investment, or SAFE Circular 13, which became effective on June 1, 2015 and was amended on December 30, 2019, cancels the

administrative approvals of foreign exchange registration of direct domestic investment and direct overseas investment and simplifies

the procedure of foreign exchange-related registration.

Pursuant to SAFE Circular 13, investors should register with banks for direct

domestic investment and direct overseas investment.

Notice of the State Administration of Foreign Exchange on Reforming the Administration of Foreign Exchange Settlement of Capital of Foreign-invested

Enterprises, which was promulgated on March 30, 2015, became effective on June 1, 2015, and was amended on December 30, 2019, provides

that an FIE may, according to its actual business needs, settle with a bank the portion of the foreign exchange capital in its capital

account for which the relevant foreign exchange administration has confirmed monetary capital contribution rights and interests (or for

which the bank has registered the injection of the monetary capital contribution into the account).

Pursuant to this circular, for the

time being, FIEs are allowed to settle 100% of their foreign exchange capital on a discretionary basis;

an FIE should truthfully use

its capital for its own operational purposes within the scope of its business;

where an ordinary FIE makes domestic equity investment

with the amount of foreign exchanges settled, the FIE must first go through domestic re-investment registration and open a corresponding

account for foreign exchange settlement pending payment with the foreign exchange administration or the bank at the place where it is

Notice of the State Administration of Foreign Exchange on Policies for Reforming and Regulating the Control over Foreign Exchange Settlement

under the Capital Account, which was promulgated and became effective on June 9, 2016, provides that enterprises registered in Mainland

China may also convert their foreign debts from foreign currency into Renminbi on a self-discretionary basis.

This circular also provides

an integrated standard for conversion of foreign exchange under capital account items (including, but not limited to, foreign currency

capital and foreign debts) on a self-discretionary basis, which applies to all enterprises registered in Mainland China.

January 26, 2017, SAFE promulgated the Notice of State Administration of Foreign Exchange on Improving the Check of Authenticity and

Compliance to further Promote Foreign Exchange Control, which stipulates several capital control measures with respect to the outbound

remittance of profit from domestic entities to offshore entities, including:

(i) banks should check board resolutions regarding profit

distribution, the original version of tax filing records, and audited financial statements pursuant to the principle of genuine transactions;

and (ii) domestic entities should hold income to account for previous years’ losses before remitting the profits.

Moreover, pursuant

to this circular, domestic entities should make detailed explanations of the sources of capital and utilization arrangements, and provide

board resolutions, contracts, and other proof when completing the registration procedures in connection with an outbound investment.

October 25, 2019, the SAFE promulgated the Notice of the State Administration of Foreign Exchange on Further Promoting the Facilitation

of Cross-border Trade and Investment, which, among other things, allows all FIEs to use Renminbi converted from foreign currency-denominated

capital for equity investments in Mainland China, as long as the equity investment is genuine, does not violate applicable laws, and

complies with the negative list on foreign investment.

However, since this circular is newly promulgated, it is unclear how the SAFE

and competent banks will carry it out in practice.

to the Regulations of the PRC on Administration of Company Registration, which were promulgated by the State Council on June 24, 1994,

became effective on July 1, 1994, and were amended on February 6, 2016, and other laws and regulations governing FIEs and company registrations,

the establishment of an FIE and any capital increase and other major changes in an FIE should be registered with the State Administration

for Market Regulation or its local counterparts and filed via the enterprise registration system.

to SAFE Circular 13 and other laws and regulations relating to foreign exchange, when setting up a new FIE, the enterprise should register

with the bank located at its registered place after obtaining the business license, and if there is any change in capital or other changes

relating to the basic information of the FIE, including, without limitation, any increase in its registered capital or total investment,

the FIE must register such changes with the bank located at its registered place after obtaining approval from or completing the filing

with relevant authorities.

Pursuant to the relevant foreign exchange laws and regulations, such foreign exchange registration with the

banks will typically take less than four weeks upon the acceptance of the registration application.

on the foregoing, if we intend to provide funding to our wholly foreign-owned subsidiaries through capital injection at or after their

establishment, we must register the establishment of and any follow-on capital increase in our wholly foreign-owned subsidiaries with

the State Administration for Market Regulation or its local counterparts, file such via the enterprise registration system, and register

such with the local banks for the foreign exchange related matters.

on Offshore Financing

the Circular of the SAFE on Issues Concerning the Foreign Exchange Administration over the Overseas Investment and Financing and Round-Trip

Investment by Domestic Residents via Special Purpose Vehicles, or SAFE Circular 37, effective on July 4, 2014, Mainland China residents

are required to register with the local SAFE branch prior to the establishment or control of an offshore special purpose vehicle, which

is defined as an offshore enterprise directly established or indirectly controlled by Mainland China residents for investment and financing

purposes, with the enterprise assets or interests Mainland China residents hold in Mainland China or overseas.

The term “control”

means to obtain the operation rights, right to proceeds, or decision-making power of a special purpose vehicle through acquisition, trust,

holding shares on behalf of others, voting rights, repurchase, convertible bonds, or other means.

At the same time, the SAFE has issued

the Operation Guidance for the Issues Concerning Foreign Exchange Administration over Round-Trip Investment regarding the procedures

for SAFE registration under SAFE Circular 37, which became effective on July 4, 2014 as an attachment of SAFE Circular 37.

Mainland China residents are also required to amend the registration or filing with the local SAFE branch any material change in the

offshore company, such as any change of basic information (including change of such Mainland China residents, name and operation term),

increase or decreases in investment amount, transfers or exchanges of shares, or merger or divisions.

On February 28, 2015, SAFE promulgated

the Notice on Further Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or SAFE Notice 13, which

became effective on June 1, 2015.

Pursuant to SAFE Notice 13, instead of applying for approvals regarding foreign exchange registrations

of foreign direct investment and overseas direct investment from SAFE as required under current laws, entities and individuals will be

required to apply for such foreign exchange registrations, including those required under the SAFE Circular 37, from qualified banks.

The qualified banks, under the supervision of SAFE, will directly examine the applications and conduct the registration.

to comply with the registration procedures set forth in the SAFE Circular 37, or making misrepresentation on or failure to disclose controllers

of foreign-invested enterprise that is established through round-trip investment, may result in restrictions being imposed on the foreign

exchange activities of the relevant onshore company, including the increase of its registered capital, the payment of dividends and other

distributions to its offshore parent or affiliate and the capital inflow from the offshore entities, and may also subject relevant Mainland

China residents to penalties under Mainland China foreign exchange administration regulations.

Mainland China residents who directly

or indirectly hold any shares in our company from time to time are required to register with SAFE in connection with their investments

We have requested Mainland China residents holding direct or indirect interest in our company to our knowledge to make the necessary

applications, filings and amendments as required under the SAFE Circular 37 and other related rules.

of the date of this Annual Report, the Mainland China residents have either not completed, or have not applied for, foreign exchange

registration under the SAFE Circular 37 and other related rules.

Although they are either in the process of making foreign exchange registration

or plan to make foreign exchange registrations, they may still be faced with the above possible fines in accordance with the PRC Laws.

on Dividend Distribution

principal laws and regulations regulating the distribution of dividends by FIEs in Mainland China include the PRC Company Law, as amended

in 2004, 2005, 2013, and 2018, and the 2019 PRC Foreign Investment Law and its Implementation Rules.

Under the current regulatory regime

in Mainland China, FIEs in Mainland China may pay dividends only out of their retained earnings, if any, determined in accordance with

Mainland China accounting standards and regulations.

A Mainland China company is required to set aside as statutory reserve funds at

least 10% of its after-tax profit, until the cumulative amount of such reserve funds reaches 50% of its registered capital unless laws

regarding foreign investment provide otherwise.

A Mainland China company cannot distribute any profits until any losses from prior fiscal

years have been offset.

Profits retained from prior fiscal years may be distributed together with distributable profits from the current

currently intend to retain most, if not all, of our available funds and any future earnings to fund the development and growth of our

As a result, we do not expect to pay any cash dividends in the foreseeable future.

Therefore, you should not rely on an investment

in our common stock as a source for any future dividend income.

on M&A and Overseas Listing

August 2006, six PRC governmental agencies jointly promulgated the Provisions on Foreign-funded Mergers and Acquisitions of Domestic

Enterprises, or the M&A Rule, as most recently amended in 2009.

The M&A Rule requires offshore special purpose vehicles formed

to pursue overseas listing of equity interests in Mainland China companies and controlled directly or indirectly by Mainland China companies

or individuals to obtain the approval of the China Securities Regulatory Commission (“CSRC”) prior to the listing and trading

of such special purpose vehicle’s securities on any stock exchange overseas.

Under the PRC Foreign Currency

Administration Rules promulgated on January 29, 1996 and most recently amended on August 5, 2008 and various regulations issued by the

SAFE, and other relevant PRC government authorities, Renminbi is convertible into other currencies for current account items, such as

trade-related receipts and payments and payment of interest and dividends.

The conversion of Renminbi into other currencies and remittance

of the converted foreign currency outside Mainland China for capital account items, such as direct equity investments, loans, and repatriation

of investment, requires the prior approval from the SAFE or its local office.

Payments for transactions

that take place in Mainland China must be made in Renminbi.

Unless otherwise approved, Mainland China companies may not repatriate foreign

currency payments received from abroad or retain the same abroad.

FIEs may retain foreign exchange in accounts with designated foreign

exchange banks under the current account items subject to a cap set by the SAFE or its local branch.

Foreign exchange proceeds under the

current accounts may be either retained or sold to a financial institution engaged in settlement and sale of foreign exchange pursuant

to relevant SAFE rules and regulations.

For foreign exchange proceeds under the capital accounts, approval from the SAFE is generally

required for the retention or sale of such proceeds to a financial institution engaged in settlement and sale of foreign exchange.

Pursuant to the Circular of

the SAFE on Notice of State Administration of Foreign Exchange on Further Improvements and Adjustments to Foreign Exchange Control Policies

for Direct Investment, which was promulgated on November 19, 2012, became effective on December 17, 2012, and was further amended on May

4, 2015, October 10, 2018, and December 30, 2019, approval of the SAFE is not required for opening a foreign exchange account and depositing

foreign exchange into the accounts relating to the direct investments.

This circular also simplifies foreign exchange-related registration

required for foreign investors to acquire equity interests of PRC companies and further improve the administration on foreign exchange

settlement for FIEs.

The Notice of the State Administration

of Foreign Exchange on Further Simplifying and Improving the Foreign Exchange Management Policies for Direct Investment, or SAFE Circular

13, which became effective on June 1, 2015 and was amended on December 30, 2019, cancels the administrative approvals of foreign exchange

registration of direct domestic investment and direct overseas investment and simplifies the procedure of foreign exchange-related registration.

Pursuant to SAFE Circular 13, investors should register with banks for direct domestic investment and direct overseas investment.

The Notice of the State Administration

of Foreign Exchange on Reforming the Administration of Foreign Exchange Settlement of Capital of Foreign-invested Enterprises, which was

promulgated on March 30, 2015, became effective on June 1, 2015, and was amended on December 30, 2019, provides that an FIE may, according

to its actual business needs, settle with a bank the portion of the foreign exchange capital in its capital account for which the relevant

foreign exchange administration has confirmed monetary capital contribution rights and interests (or for which the bank has registered

the injection of the monetary capital contribution into the account).

Pursuant to this circular, for the time being, FIEs are allowed

to settle 100% of their foreign exchange capital on a discretionary basis;

an FIE should truthfully use its capital for its own operational

purposes within the scope of its business;

where an ordinary FIE makes domestic equity investment with the amount of foreign exchanges

settled, the FIE must first go through domestic re-investment registration and open a corresponding account for foreign exchange settlement

pending payment with the foreign exchange administration or the bank at the place where it is registered.

The Notice of the State Administration

of Foreign Exchange on Policies for Reforming and Regulating the Control over Foreign Exchange Settlement under the Capital Account, which

was promulgated and became effective on June 9, 2016, provides that enterprises registered in Mainland China may also convert their foreign

debts from foreign currency into Renminbi on a self-discretionary basis.

This circular also provides an integrated standard for conversion

of foreign exchange under capital account items (including, but not limited to, foreign currency capital and foreign debts) on a self-discretionary

basis, which applies to all enterprises registered in Mainland China.

On January 26, 2017, SAFE

promulgated the Notice of State Administration of Foreign Exchange on Improving the Check of Authenticity and Compliance to further Promote

Foreign Exchange Control, which stipulates several capital control measures with respect to the outbound remittance of profit from domestic

entities to offshore entities, including:

(i) banks should check board resolutions regarding profit distribution, the original version

of tax filing records, and audited financial statements pursuant to the principle of genuine transactions;

and (ii) domestic entities

should hold income to account for previous years’ losses before remitting the profits.

Moreover, pursuant to this circular, domestic

entities should make detailed explanations of the sources of capital and utilization arrangements, and provide board resolutions, contracts,

and other proof when completing the registration procedures in connection with an outbound investment.

On October 25, 2019, the SAFE

promulgated the Notice of the State Administration of Foreign Exchange on Further Promoting the Facilitation of Cross-border Trade and

Investment, which, among other things, allows all FIEs to use Renminbi converted from foreign currency-denominated capital for equity

investments in Mainland China, as long as the equity investment is genuine, does not violate applicable laws, and complies with the negative

list on foreign investment.

However, since this circular is newly promulgated, it is unclear how the SAFE and competent banks will carry

it out in practice.

According to the Regulations

of the PRC on Administration of Company Registration, which were promulgated by the State Council on June 24, 1994, became effective on

July 1, 1994, and were amended on February 6, 2016, and other laws and regulations governing FIEs and company registrations, the establishment

of an FIE and any capital increase and other major changes in an FIE should be registered with the State Administration for Market Regulation

or its local counterparts and filed via the enterprise registration system.

Pursuant to SAFE Circular

13 and other laws and regulations relating to foreign exchange, when setting up a new FIE, the enterprise should register with the bank

located at its registered place after obtaining the business license, and if there is any change in capital or other changes relating

to the basic information of the FIE, including, without limitation, any increase in its registered capital or total investment, the FIE

must register such changes with the bank located at its registered place after obtaining approval from or completing the filing with relevant

Pursuant to the relevant foreign exchange laws and regulations, such foreign exchange registration with the banks will typically

take less than four weeks upon the acceptance of the registration application.

Based on the foregoing, if

we intend to provide funding to our wholly foreign-owned subsidiaries through capital injection at or after their establishment, we must

register the establishment of and any follow-on capital increase in our wholly foreign-owned subsidiaries with the State Administration

for Market Regulation or its local counterparts, file such via the enterprise registration system, and register such with the local banks

for the foreign exchange related matters.

Regulations on Offshore Financing

Under the Circular of the

SAFE on Issues Concerning the Foreign Exchange Administration over the Overseas Investment and Financing and Round-Trip Investment by

Domestic Residents via Special Purpose Vehicles, or SAFE Circular 37, effective on July 4, 2014, Mainland China residents are required

to register with the local SAFE branch prior to the establishment or control of an offshore special purpose vehicle, which is defined

as an offshore enterprise directly established or indirectly controlled by Mainland China residents for investment and financing purposes,

with the enterprise assets or interests Mainland China residents hold in Mainland China or overseas.

The term “control” means

to obtain the operation rights, right to proceeds, or decision-making power of a special purpose vehicle through acquisition, trust, holding

shares on behalf of others, voting rights, repurchase, convertible bonds, or other means.

At the same time, the SAFE has issued the Operation

Guidance for the Issues Concerning Foreign Exchange Administration over Round-Trip Investment regarding the procedures for SAFE registration

under SAFE Circular 37, which became effective on July 4, 2014 as an attachment of SAFE Circular 37.

The Mainland China residents

are also required to amend the registration or filing with the local SAFE branch any material change in the offshore company, such as

any change of basic information (including change of such Mainland China residents, name and operation term), increase or decreases in

investment amount, transfers or exchanges of shares, or merger or divisions.

On February 28, 2015, SAFE promulgated the Notice on Further

Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or SAFE Notice 13, which became effective on June

Pursuant to SAFE Notice 13, instead of applying for approvals regarding foreign exchange registrations of foreign direct investment

and overseas direct investment from SAFE as required under current laws, entities and individuals will be required to apply for such foreign

exchange registrations, including those required under the SAFE Circular 37, from qualified banks.

The qualified banks, under the supervision

of SAFE, will directly examine the applications and conduct the registration.

Failure to comply with the

registration procedures set forth in the SAFE Circular 37, or making misrepresentation on or failure to disclose controllers of foreign-invested

enterprise that is established through round-trip investment, may result in restrictions being imposed on the foreign exchange activities

of the relevant onshore company, including the increase of its registered capital, the payment of dividends and other distributions to

its offshore parent or affiliate and the capital inflow from the offshore entities, and may also subject relevant Mainland China residents

to penalties under Mainland China foreign exchange administration regulations.

Mainland China residents who directly or indirectly hold

any shares in our company from time to time are required to register with SAFE in connection with their investments in us.

We have requested

Mainland China residents holding direct or indirect interest in our company to our knowledge to make the necessary applications, filings

and amendments as required under the SAFE Circular 37 and other related rules.

As of the date of this Annual

Report, the Mainland China residents have either not completed, or have not applied for, foreign exchange registration under the SAFE

Circular 37 and other related rules.

Although they are either in the process of making foreign exchange registration or plan to make foreign

exchange registrations, they may still be faced with the above possible fines in accordance with the PRC Laws.

Regulations on Dividend Distribution

The principal laws and regulations

regulating the distribution of dividends by FIEs in Mainland China include the PRC Company Law, as amended in 2004, 2005, 2013, and 2018,

and the 2019 PRC Foreign Investment Law and its Implementation Rules.

Under the current regulatory regime in Mainland China, FIEs in Mainland

China may pay dividends only out of their retained earnings, if any, determined in accordance with Mainland China accounting standards

and regulations.

A Mainland China company is required to set aside as statutory reserve funds at least 10% of its after-tax profit, until

the cumulative amount of such reserve funds reaches 50% of its registered capital unless laws regarding foreign investment provide otherwise.

A Mainland China company cannot distribute any profits until any losses from prior fiscal years have been offset.

Profits retained from

prior fiscal years may be distributed together with distributable profits from the current fiscal year.

We currently intend to retain

most, if not all, of our available funds and any future earnings to fund the development and growth of our business.

As a result, we do

not expect to pay any cash dividends in the foreseeable future.

Therefore, you should not rely on an investment in our common stock as

a source for any future dividend income.

Regulations on M&A and Overseas Listing

In August 2006, six PRC governmental

agencies jointly promulgated the Provisions on Foreign-funded Mergers and Acquisitions of Domestic Enterprises, or the M&A Rule, as

most recently amended in 2009.

The M&A Rule requires offshore special purpose vehicles formed to pursue overseas listing of equity

interests in Mainland China companies and controlled directly or indirectly by Mainland China companies or individuals to obtain the approval

of the China Securities Regulatory Commission (“CSRC”) prior to the listing and trading of such special purpose vehicle’s

securities on any stock exchange overseas.

M&A Rule further requires that the Ministry of Commerce, or MOFCOM, be notified in advance of any change-of-control transaction in

4 unchanged sentences

which are deemed concentrations and involve parties with specified turnover thresholds be cleared by the MOFCOM before they can be completed.

February 17, 2023, with the approval of the State Council, the CSRC released the Trial Administrative Measures of Overseas Securities

Offering and Listing by Domestic Companies, or the Trial Administrative Measures, and five supporting guidelines, which came into effect

on March 31, 2023.

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

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

(2) if the issuer meets

both of the following conditions, the overseas offering and listing shall be determined as an indirect overseas offering and listing

by a domestic company:

(i) any of the total assets, net assets, revenues or profits of the domestic operating entities of the issuer

in the most recent accounting year accounts for more than 50% of the corresponding figure in the issuer’s audited consolidated

financial statements for the same period;

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

of business are located in Mainland China, or the senior managers in charge of operation and management of the issuer are mostly Chinese

citizens or are domiciled in Mainland 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 offering and listing in an overseas market, the issuer shall submit filings with the CSRC

within three business days after such application is submitted.

According to the relevant provisions of the Trial Administrative Measures

and its supporting guidelines, the Company is required to fulfill the filing procedures with the CSRC within three days of the closing

of the Offering.

According to the Trial Administrative Measures, the Company has submitted the filing materials to the CSRC, but the

materials were not complete due to lack of a commitment letter from the Company’s lead underwriter for the Offering, and the

Company withdrew the filing from the CSRC.

On February 17, 2023, with

the approval of the State Council, the CSRC released the Trial Administrative Measures of Overseas Securities Offering and Listing by

Domestic Companies, or the Trial Administrative Measures, and five supporting guidelines, which came into effect on March 31, 2023.

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

should fulfill the filing procedure and report relevant information to the CSRC;

(2) if the issuer meets both of the following conditions,

the overseas offering and listing shall be determined as an indirect overseas offering and listing by a domestic company:

(i) any of the

total assets, net assets, revenues or profits of the domestic operating entities of the issuer in the most recent accounting year accounts

for more than 50% of the corresponding figure in the issuer’s audited consolidated financial statements for the same period;

its major operational activities are carried out in Mainland China or its main places of business are located in Mainland China, or the

senior managers in charge of operation and management of the issuer are mostly Chinese citizens or are domiciled in Mainland China;

(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 offering

and listing in an overseas market, the issuer shall submit filings with the CSRC within three business days after such application is

According to the relevant provisions of the Trial Administrative Measures and its supporting guidelines, the Company is required

to fulfill the filing procedures with the CSRC within three days of the closing of the 2024 Uplisting Offering.

According to the Trial

Administrative Measures, the Company has submitted the filing materials to the CSRC, but the materials were not complete due to lack of

a commitment letter from the Company’s lead underwriter for the 2024 Uplisting Offering, and the Company withdrew the filing from

The Company will submit the filing materials again when the materials are ready.

given that the Trial Administrative Measures were recently promulgated, there remain substantial uncertainties as to their interpretation,

application, and enforcement and there is no guarantee that the relevant PRC government agencies, including the CSRC, would reach the

same conclusion that we and our PRC counsel have reached.

If the CSRC has determined that we have failed to comply with the post-offering

filing obligations imposed by the Trial Administrative Measures or make a misrepresentation, misleading statement or material omission

in the materials we submit to the CSRC, the CSRC would have the right to order rectification, issue a warning and impose a fine on us

of between RMB 1 million and RMB 10 million and issuing a warning to the parties responsible for such failure, misrepresentation or material

omission and impose a fine on each of such individuals ranging from RMB 500,000 to RMB 5 million.

On February 17, 2023, the CSRC held a press conference for the release of the Trial Administrative Measures and issued

the Notice on Administration for the Filing of Overseas Offering and Listing by Domestic Companies, which, among others, clarifies that

(1) a six-month transition period will be granted to domestic companies which, prior to the effective date of the Trial Administrative

Measures, have already obtained the approval from overseas regulatory authorities or stock exchanges, such as completion of registration

in the market of the United States, but have not completed the indirect overseas listing;

and (2) domestic companies that have already

submitted valid applications for overseas offering and listing but have not obtained approval from overseas regulatory authorities or

stock exchanges on or prior to the effective date of the Trial Administrative Measures, may reasonably arrange the timing for submitting

their filing applications with the CSRC, and shall complete the filing before the completion of their overseas offering and listing.

March 16, 2007, the National People’s Congress promulgated the PRC Enterprise Income Tax Law, which was amended on February 24,

2017 and December 29, 2018.

On December 6, 2007, the State Council enacted the Regulations for the Implementation of the Enterprise Income

Tax Law, which became effective on January 1, 2008 and amended on April 23, 2019.

Under the Enterprise Income Tax Law and the relevant

implementation regulations, both resident enterprises and non-resident enterprises are subject to tax in Mainland China.

Resident enterprises

are defined as enterprises that are established in Mainland China in accordance with PRC laws, or that are established in accordance

with the laws of foreign countries but are actually or in effect controlled from within Mainland China.

Non-resident enterprises are

defined as enterprises that are organized under the laws of foreign countries and whose actual management is conducted outside Mainland

China, but have established institutions or premises in Mainland China, or have no such established institutions or premises but have

income generated from inside Mainland China.

Under the Enterprise Income Tax Law and relevant implementing regulations, a uniform corporate

income tax rate of 25% is applied.

However, if non-resident enterprises have not formed permanent establishments or premises in Mainland

China, or if they have formed permanent establishment or premises in Mainland China but there is no actual relationship between the relevant

income derived in Mainland China and the established institutions or premises set up by them, enterprise income tax is set at the rate

of 10% with respect to their income sourced from inside Mainland China.

PRC Provisional Regulations on Value-Added Tax were promulgated by the State Council on December 13, 1993, which became effective on

January 1, 1994 and were subsequently amended from time to time.

The Detailed Rules for the Implementation of the PRC Provisional Regulations

on Value-Added Tax (2011 Revision) was promulgated by the Ministry of Finance on December 25, 1993 and subsequently amended on December

15, 2008 and October 28, 2011.

On November 19, 2017, the State Council promulgated the Decisions on Abolishing the PRC Provisional Regulations

on Business Tax and Amending the PRC Provisional Regulations on Value-Added Tax.

Pursuant to these regulations, rules and decisions,

all enterprises and individuals engaged in sale of goods, provision of processing, repair, and replacement services, sales of services,

intangible assets, real property, and the importation of goods within Mainland China territory are VAT taxpayers.

On March 21, 2019,

the Ministry of Finance, the SAT, and the General Administration of Customs jointly issued the Announcement on Relevant Policies on Deepen

the Reform of Value-Added Tax.

Sales revenue represents the invoiced value of goods, net of VAT.

The VAT is based on gross sales price

and VAT rates range up to 17%, starting from May 1, 2018, VAT rate was lowered to 16%, and starting from April 1, 2019, VAT rate was

further lowered to 13%.

Withholding Tax

Enterprise Income Tax Law provides that since January 1, 2008, an income tax rate of 10% will normally be applicable to dividends declared

to non-Mainland China resident investors that do not have an establishment or place of business in Mainland China, or that have such

establishment or place of business but the relevant income is not effectively connected with the establishment or place of business,

to the extent such dividends are derived from sources within Mainland China.

to the Arrangement Between the Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and

the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital, and other applicable PRC laws, if a Hong Kong resident

enterprise is determined by the competent Mainland China tax authority to have met the relevant conditions and requirements under this

arrangement and other applicable laws, the 10% withholding tax on the dividends the Hong Kong resident enterprise receives from a Mainland

China resident enterprise may be reduced to 5%.

However, based on the Circular on Certain Issues with Respect to the Enforcement of Dividend

Provisions in Tax Treaties issued on February 20, 2009, if the relevant Mainland China tax authorities determine, in their discretions,

that a company benefits from such reduced income tax rate due to a structure or arrangement that is primarily tax-driven, such Mainland

China tax authorities may adjust the preferential tax treatment.

Pursuant to the Circular on Several Questions regarding the “Beneficial

Owner” in Tax Treaties, which was issued on February 3, 2018 by the SAT and became effective on April 1, 2018, when determining

the applicant’s status as the “beneficial owner” regarding tax treatments in connection with dividends, interests,

or royalties in the tax treaties, several factors, including, without limitation, whether the applicant is obligated to pay more than

50% of his or her income in twelve months to residents in third country or region, whether the business operated by the applicant constitutes

the actual business activities, and whether the counterparty country or region to the tax treaties does not levy any tax or grant any

tax exemption on relevant incomes or levy tax at an extremely low rate, will be taken into account, and such factors will be analyzed

according to the actual circumstances of the specific cases.

This circular further provides that an applicant who intends to prove his

or her status as the “beneficial owner” must submit the relevant documents to the relevant tax bureau pursuant to the Announcement

on Issuing the Measures for the Administration of Non-Resident Taxpayers’ Enjoyment of the Treatment under Tax Agreements.

on Employment Laws

accordance with the PRC National Labor Law, which became effective in January 1995 and amended from time to time, and the PRC Labor Contract

Law, which became effective in January 2008, as amended subsequently, employers must execute written labor contracts with full-time employees

in order to establish an employment relationship.

All employers must compensate their employees equal to at least the local minimum wage

All employers are required to establish a system for labor safety and sanitation, strictly abide by state rules and standards

and provide employees with appropriate workplace safety training.

In addition, employers in Mainland China are obliged to pay contributions

to the social insurance plan and the housing fund plan for employees.

However, given that the Trial Administrative

Measures were recently promulgated, there remain substantial uncertainties as to their interpretation, application, and enforcement and

there is no guarantee that the relevant PRC government agencies, including the CSRC, would reach the same conclusion that we and our PRC

counsel have reached.

If the CSRC has determined that we have failed to comply with the post-offering filing obligations imposed by the

Trial Administrative Measures or make a misrepresentation, misleading statement or material omission in the materials we submit to the

CSRC, the CSRC would have the right to order rectification, issue a warning and impose a fine on us of between RMB 1 million and RMB 10

million and issuing a warning to the parties responsible for such failure, misrepresentation or material omission and impose a fine on

each of such individuals ranging from RMB 500,000 to RMB 5 million.

On February 17, 2023, the

CSRC held a press conference for the release of the Trial Administrative Measures and issued the Notice on Administration for the Filing

of Overseas Offering and Listing by Domestic Companies, which, among others, clarifies that (1) a six-month transition period will be

granted to domestic companies which, prior to the effective date of the Trial Administrative Measures, have already obtained the approval

from overseas regulatory authorities or stock exchanges, such as completion of registration in the market of the United States, but have

not completed the indirect overseas listing;

and (2) domestic companies that have already submitted valid applications for overseas offering

and listing but have not obtained approval from overseas regulatory authorities or stock exchanges on or prior to the effective date of

the Trial Administrative Measures, may reasonably arrange the timing for submitting their filing applications with the CSRC, and shall

complete the filing before the completion of their overseas offering and listing.

Regulations on Taxation

Enterprise Income Tax

On March 16, 2007, the National

People’s Congress promulgated the PRC Enterprise Income Tax Law, which was amended on February 24, 2017 and December 29, 2018.

December 6, 2007, the State Council enacted the Regulations for the Implementation of the Enterprise Income Tax Law, which became effective

on January 1, 2008 and amended on April 23, 2019.

Under the Enterprise Income Tax Law and the relevant implementation regulations, both

resident enterprises and non-resident enterprises are subject to tax in Mainland China.

Resident enterprises are defined as enterprises

that are established in Mainland China in accordance with PRC laws, or that are established in accordance with the laws of foreign countries

but are actually or in effect controlled from within Mainland China.

Non-resident enterprises are defined as enterprises that are organized

under the laws of foreign countries and whose actual management is conducted outside Mainland China, but have established institutions

or premises in Mainland China, or have no such established institutions or premises but have income generated from inside Mainland China.

Under the Enterprise Income Tax Law and relevant implementing regulations, a uniform corporate income tax rate of 25% is applied.

if non-resident enterprises have not formed permanent establishments or premises in Mainland China, or if they have formed permanent establishment

or premises in Mainland China but there is no actual relationship between the relevant income derived in Mainland China and the established

institutions or premises set up by them, enterprise income tax is set at the rate of 10% with respect to their income sourced from inside

Mainland China.

Value-Added Tax

The PRC Provisional Regulations

on Value-Added Tax were promulgated by the State Council on December 13, 1993, which became effective on January 1, 1994 and were subsequently

amended from time to time.

The Detailed Rules for the Implementation of the PRC Provisional Regulations on Value-Added Tax (2011 Revision)

was promulgated by the Ministry of Finance on December 25, 1993 and subsequently amended on December 15, 2008 and October 28, 2011.

November 19, 2017, the State Council promulgated the Decisions on Abolishing the PRC Provisional Regulations on Business Tax and Amending

the PRC Provisional Regulations on Value-Added Tax.

Pursuant to these regulations, rules and decisions, all enterprises and individuals

engaged in sale of goods, provision of processing, repair, and replacement services, sales of services, intangible assets, real property,

and the importation of goods within Mainland China territory are VAT taxpayers.

On March 21, 2019, the Ministry of Finance, the SAT, and

the General Administration of Customs jointly issued the Announcement on Relevant Policies on Deepen the Reform of Value-Added Tax.

revenue represents the invoiced value of goods, net of VAT.

The VAT is based on gross sales price and VAT rates range up to 17%, starting

from May 1, 2018, VAT rate was lowered to 16%, and starting from April 1, 2019, VAT rate was further lowered to 13%.

Dividend Withholding

The Enterprise Income Tax

Law provides that since January 1, 2008, an income tax rate of 10% will normally be applicable to dividends declared to non-Mainland China

resident investors that do not have an establishment or place of business in Mainland China, or that have such establishment or place

of business but the relevant income is not effectively connected with the establishment or place of business, to the extent such dividends

are derived from sources within Mainland China.

Pursuant to the Arrangement

Between the Mainland China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of

Fiscal Evasion with Respect to Taxes on Income and Capital, and other applicable PRC laws, if a Hong Kong resident enterprise is determined

by the competent Mainland China tax authority to have met the relevant conditions and requirements under this arrangement and other applicable

laws, the 10% withholding tax on the dividends the Hong Kong resident enterprise receives from a Mainland China resident enterprise may

be reduced to 5%.

However, based on the Circular on Certain Issues with Respect to the Enforcement of Dividend Provisions in Tax Treaties

issued on February 20, 2009, if the relevant Mainland China tax authorities determine, in their discretions, that a company benefits from

such reduced income tax rate due to a structure or arrangement that is primarily tax-driven, such Mainland China tax authorities may adjust

the preferential tax treatment.

Pursuant to the Circular on Several Questions regarding the “Beneficial Owner” in Tax Treaties,

which was issued on February 3, 2018 by the SAT and became effective on April 1, 2018, when determining the applicant’s status as

the “beneficial owner” regarding tax treatments in connection with dividends, interests, or royalties in the tax treaties,

several factors, including, without limitation, whether the applicant is obligated to pay more than 50% of his or her income in twelve

months to residents in third country or region, whether the business operated by the applicant constitutes the actual business activities,

and whether the counterparty country or region to the tax treaties does not levy any tax or grant any tax exemption on relevant incomes

or levy tax at an extremely low rate, will be taken into account, and such factors will be analyzed according to the actual circumstances

of the specific cases.

This circular further provides that an applicant who intends to prove his or her status as the “beneficial

owner” must submit the relevant documents to the relevant tax bureau pursuant to the Announcement on Issuing the Measures for the

Administration of Non-Resident Taxpayers’ Enjoyment of the Treatment under Tax Agreements.

Regulations on Employment Laws

In accordance with the PRC

National Labor Law, which became effective in January 1995 and amended from time to time, and the PRC Labor Contract Law, which became

effective in January 2008, as amended subsequently, employers must execute written labor contracts with full-time employees in order to

establish an employment relationship.

All employers must compensate their employees equal to at least the local minimum wage standards.

All employers are required to establish a system for labor safety and sanitation, strictly abide by state rules and standards and provide

employees with appropriate workplace safety training.

In addition, employers in Mainland China are obliged to pay contributions to the

social insurance plan and the housing fund plan for employees.

December 28, 2021, the Measures for Cybersecurity Review (2021 version) were promulgated and became effective on February 15, 2022 (the

1 unchanged sentence

one million users that seeks to list on a foreign stock exchange shall also be subject to cybersecurity review.

As we are neither an

“operator of critical information infrastructure” nor a “data processor” carrying out data processing activities

that affect or may affect national security, we believe that the Measures are not applicable to us even after they take effect in current

The PRC government is increasingly focused on data security, recently launching cybersecurity review against a number of mobile

apps operated by several US-listed Chinese companies and prohibiting these apps from registering new users during the review period.

There are great uncertainties regarding the interpretation and enforcement of PRC laws, rules and regulations regarding data and privacy

We may be required to change our data and other business practices and be subject to regulatory investigations, penalties,

and increased cost of operations as a result of these laws and policies.

of the date of this Annual Report, we had 131 employees.

As we are neither an “operator

of critical information infrastructure” nor a “data processor” carrying out data processing activities that affect or

may affect national security, we believe that the Measures are not applicable to us even after they take effect in current form.

government is increasingly focused on data security, recently launching cybersecurity review against a number of mobile apps operated

by several US-listed Chinese companies and prohibiting these apps from registering new users during the review period.

There are great

uncertainties regarding the interpretation and enforcement of PRC laws, rules and regulations regarding data and privacy security.

may be required to change our data and other business practices and be subject to regulatory investigations, penalties, and increased

cost of operations as a result of these laws and policies.

As of the date of this Annual

Report, we had 131 employees.

We have no part time employees or independent contractors.

required by regulations in China, Sichuan Vtouch participates in various employee social security plans that are organized

by local governments, including pension, unemployment insurance, childbirth insurance, work-related injury insurance, medical insurance

and housing insurance.

Sichuan Vtouch is required under Chinese law to make contributions to employee benefit plans at

specified percentages of the salaries, bonuses and certain allowances of our employees, up to a maximum amount specified by the local

government from time to time.

employees are not represented by a labor organization or covered by a collective bargaining agreement.

We believe that we maintain a

good working relationship with our employees and to date, we have not experienced any significant labor disputes.

As required by regulations

in China, Sichuan Vtouch participates in various employee social security plans that are organized by local governments, including pension,

unemployment insurance, childbirth insurance, work-related injury insurance, medical insurance and housing insurance.

Sichuan Vtouch is

required under Chinese law to make contributions to employee benefit plans at specified percentages of the salaries, bonuses and certain

allowances of our employees, up to a maximum amount specified by the local government from time to time.

Our employees are not represented

by a labor organization or covered by a collective bargaining agreement.

We believe that we maintain a good working relationship with

our employees and to date, we have not experienced any significant labor disputes.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business