Advanced Biomed Inc.
For the period ended Jun 30, 2026. Filed Oct 13, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2026 · Filed Oct 13, 2026
ADVB$1.98+4.2%Stored close · as of Nov 6, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2025-06-30; filed 2025-10-08.
0001213900-25-097465
Item 1A. Risk FactorsCurrent report: 10-K
Period ended 2026-06-30; filed 2026-10-13.
0001213900-26-109029
Item 1A. Risk FactorsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 256 previous paragraphs and 133 current paragraphs.
52 unchanged; 19 reworded; 61 added; 183 removed; 2 previous and 1 current paragraphs rearranged.
Tables are not compared: 75 previous and 15 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (61)
Current report
We recently transitioned our business strategy, and our future success is uncertain.
Current report
During our most recent fiscal year, we discontinued our biotechnology operations and redirected our resources toward the development of our artificial intelligence platform FinTruth. Because our continuing business differs significantly from our historical operations, investors have limited information regarding our ability to successfully execute this strategy.
Current report
The transition to an AI-focused business involves substantial risks, including developing a commercially viable platform, obtaining customer acceptance, competing against significantly larger companies, protecting proprietary technology, securing adequate financing, and generating sustainable revenues. There can be no assurance that our new business strategy will be successful.
Current report
We have generated limited revenue from our AI-focused operations and may never achieve profitability.
Current report
Following the discontinuation of our biotechnology business, our continuing operations are focused primarily on developing our artificial intelligence platform FinTruth. We currently generate no significant revenue from these activities and expect that our future operating results will depend largely upon our ability to successfully commercialize our technology.
Current report
Commercialization may require substantial additional investments, strategic partnerships, customer adoption, regulatory compliance, and market acceptance, none of which can be assured.
Current report
We may rely on a limited number of third parties for marketing, distribution and revenue, and the loss of or underperformance by any of them could harm our business.
Current report
We may rely on financial IT companies, MaaS and AI distribution platforms, foundation-model providers and other strategic technology partners for indirect distribution. Depending on a small number of partners concentrates our risk. If any of these relationships ends, is not renewed on favorable terms or underperforms, or if a partner has financial, operational or reputational problems, our revenue, our sales pipeline and our ability to carry out our business plan could be materially and adversely affected.
Current report
We have recently transitioned our business to enterprise AI applications and have a limited operating history in this industry, which makes it difficult to evaluate our prospects.
Current report
We acquired Acellent in April 2026 and have since disposed of our biomedical operations and shifted our focus entirely to FinTruth, which is currently our sole product. As of the date of this Report, we have not generated any customer revenue from FinTruth, and our revenue relating to FinTruth has been derived solely from agency service fees. Our business plan depends on converting pilot and proof-of-concept engagements into commercial contracts, achieving our twelve-month deployment and hiring objectives, and developing recurring and usage-based enterprise revenue. We may not achieve these objectives on our anticipated timeline or at all, and our limited operating history in the AI industry makes it difficult to evaluate our business and future prospects.
Current report
The market for AI financial verification is new and evolving, and may not develop as we expect.
Current report
Our strategy is premised on the continued adoption of large language models and AI agents by financial institutions in credit analysis, investment research, risk assessment and compliance review, and on demand for independent verification of AI-generated output. If financial institutions slow or limit their adoption of AI, if foundation-model providers substantially reduce hallucination and other errors in their models, or if customers prefer to rely on manual review or internal tools, demand for FinTruth may be lower than we anticipate. Commercial banks, insurance companies and other regulated institutions also typically have lengthy procurement, security review and approval processes, which may delay or prevent sales.
Current report
The AI industry is intensely competitive and rapidly changing, and we may be unable to compete successfully against larger and better-funded competitors.
Current report
We face competition from foundation-model providers that may incorporate verification, citation and fact-checking functions directly into their models, from large technology, data and financial information companies, from financial IT companies, and from other AI start-ups. Many of these competitors have substantially greater financial, technical, data and marketing resources, larger customer bases and broader distribution than we do. Some of the same parties with whom we seek to collaborate, including foundation-model providers and financial IT platforms, may also compete with us. The rapid pace of innovation in AI may render our technology obsolete or require us to make significant investments to remain competitive, which we may be unable to fund.
Current report
Evolving laws and regulations relating to AI in the jurisdictions where we or our customers operate could increase our costs, restrict our services or reduce demand for FinTruth.
Current report
Governments in many jurisdictions, including the United States at the federal and state levels, the European Union and other markets, have adopted or are considering laws, regulations and guidance governing the development and use of AI, including requirements relating to transparency, explainability, risk management, human oversight, data governance and the use of AI in credit and other consequential decisions. Our customers in regulated financial services may be subject to such requirements and may in turn impose them on us. While increasing regulatory focus on the accountability and accuracy of AI is a driver of our business, new or inconsistent regulatory requirements could require us to change FinTruth, limit the use cases or jurisdictions we can serve, increase our compliance costs and expose us to liability.
Current report
We depend on third-party cloud providers, models and distribution partners, and any disruption in these relationships could harm our business.
Current report
We do not own any data centers, and the SaaS version of FinTruth runs on rented infrastructure from multiple international public cloud providers. We also rely, and expect to rely increasingly, on financial IT companies, MaaS and AI distribution platforms, foundation-model providers and marketing partners, to distribute and promote FinTruth. Interruptions, capacity constraints, price increases or changes in terms by our cloud providers, or the termination of or failure to perform by our distribution and marketing partners, could disrupt our services, increase our costs and impair our ability to grow our customer base.
Current report
We may be unable to attract and retain qualified AI and engineering talent.
Current report
Competition for personnel with expertise in AI research, algorithm engineering, data and knowledge engineering and financial domain knowledge is intense. Our AI research and algorithm engineering team currently consists of three full-time employees, and we intend to grow from twelve to approximately eighteen full-time employees under our twelve-month plan. The loss of any key personnel, or our inability to hire additional qualified personnel on acceptable terms, could delay the development of Smith RM and FinTruth and adversely affect our business.
Current report
We may be unable to adequately protect our proprietary technology and data, and we may be subject to claims that we infringe the intellectual property rights of others.
Current report
Our success depends in part on our proprietary technology and data assets, including Smith RM, our verification algorithms, our financial rules knowledge base and our proprietary datasets. We rely primarily on trade secret protection, confidentiality agreements and contractual restrictions to protect these assets, and these measures may not prevent unauthorized use, disclosure or reverse engineering of our technology, or the independent development of similar technology by our competitors. In addition, our datasets are derived in part from publicly available information, and the legal framework governing the use of such information, including for model training, remains unsettled in Hong Kong, the PRC and other jurisdictions. Third parties may claim that FinTruth, Smith RM or our datasets infringe or misappropriate their intellectual property or data rights. Any such claims, regardless of merit, could be costly to defend, divert the attention of our management, require us to pay damages or license fees, or require us to modify or cease offering portions of FinTruth.
Current report
FinTruth is a complex software, and undetected defects, errors, vulnerabilities or performance failures could harm our reputation, cause us to lose customers and expose us to liability.
Current report
FinTruth combines several parts: a data ingestion layer, the Smith RM reasoning core, a formal verification engine with numerical, logical, ontology and narrative verifiers, a financial rules knowledge base, and an output layer. It is delivered as a browser-based SaaS workspace, through APIs and as an on-premises deployment. Software this complex often contains defects, errors or vulnerabilities, particularly when new versions, verification modules or features are first released. These may be found only after our customers have used the product. Defects could cause FinTruth to process documents incorrectly, fail to extract numbers or claims, misclassify claims, produce inaccurate audit reports, or become unavailable. Correcting defects may require significant resources and may not be done in time. Any such problem could lead to lost or delayed market acceptance, loss of customers, warranty or indemnity claims, diversion of engineering resources and damage to our reputation.
Current report
On-premises deployments of FinTruth involve additional technical, support and security challenges.
Current report
When FinTruth is deployed on-premises, it runs on the customer’s own infrastructure and is subject to the customer’s security controls. Each customer environment may differ in hardware, operating systems, network setup and security policies. This can make implementation, configuration, testing, updates and technical support more difficult, slower and more expensive. Our client solutions and commercialization team, supported by our product and software engineering team, may not be able to support a growing number of on-premises deployments. We also have limited visibility into and control over customer environments. Performance problems or security incidents arising in those environments may be attributed to FinTruth even when we did not cause them, which could lead to disputes, liability or reputational harm. Deploying our software, including Smith RM, outside our own controlled environment may also increase the risk that it is copied, reverse engineered or misappropriated.
Current report
Cyberattacks, security breaches and other incidents affecting our systems or those of our third-party providers could disrupt our operations, compromise confidential information and subject us to significant liability.
Current report
Our business depends on the confidentiality, integrity and availability of our information technology systems and data. That includes the confidential financial reports, credit reports and other source documents our customers upload, our proprietary datasets, and the source code and model weights of Smith RM. Cyberattacks are becoming more frequent, sophisticated and severe, and they come from many types of attackers, including organized criminal groups, hacktivists and state-sponsored actors. Threats include ransomware, phishing and social engineering, denial-of-service attacks, credential theft, malware and exploitation of software vulnerabilities, including previously unknown (“zero-day”) vulnerabilities. Attackers are also increasingly using AI to make their attacks more effective. Companies that provide services to financial institutions may be especially attractive targets because of the value of the data they handle.
Current report
We use rented infrastructure from multiple international public cloud providers, as well as other third-party software and service providers. Our ability to monitor their security practices is limited, and an incident affecting any of them could affect us. Like other companies our size, we have limited resources to spend on cybersecurity, and our security measures may not detect or prevent every incident. A security incident could interrupt our services, cause loss, corruption or unauthorized disclosure of customer or proprietary data, and lead to theft of our intellectual property. It could also result in regulatory investigations and penalties, notification obligations, litigation, breach of contract claims, loss of customers and significant remediation costs. Any of these could materially and adversely affect our business, financial condition and results of operations.
Current report
Our financial-institution customers impose demanding security, data-handling and audit requirements, and our failure to satisfy them could prevent us from winning or keeping customers.
Current report
Our target customers include commercial banks, securities firms, insurance companies, asset managers and auditing firms. These customers are subject to extensive regulation of how they manage technology, outsourcing and third-party risk. Before buying from us, they typically conduct detailed security and vendor due diligence. They may also require contract terms on data protection, data location, business continuity, incident notification, audit rights, service levels and liability. Meeting these requirements may require us to get security certifications, put in place additional controls, pay for audits or accept increased liability. Doing so could be costly and lengthen our sales cycles. If we cannot meet these requirements, or if we breach them after signing a contract, we may lose customers, face contractual claims or be shut out of parts of our target market.
Current report
We are subject to SEC cybersecurity disclosure requirements, and a failure to identify, assess or timely disclose material cybersecurity incidents could expose us to regulatory action and litigation.
Current report
SEC rules require us to describe our processes for assessing, identifying and managing material cybersecurity risks, as well as our board’s oversight of those risks. They also require us to disclose a cybersecurity incident on Form 8-K within four business days after we determine that the incident is material. Deciding whether an incident is material can be complex and must be done quickly, often before all the facts are known. Making this assessment may be especially difficult for us because we have a lean operating structure and limited dedicated security personnel. If we fail to assess or disclose incidents properly, or if our disclosure is later found to be inaccurate or incomplete, we could face SEC enforcement action, securities litigation and reputational harm. In addition, a public disclosure could itself reveal information that attackers or competitors could exploit.
Current report
Our insurance coverage may not be adequate to cover losses from cybersecurity incidents, technology failures or other operational events.
Current report
We may not have insurance that is sufficient for, or covers at all, losses from cybersecurity incidents, service interruptions, professional liability claims related to FinTruth’s outputs, or other operational events. Cyber and technology errors and omissions insurance may be unavailable on acceptable terms, may become more expensive, or may contain exclusions, deductibles and coverage limits that leave us responsible for a large part of any loss. Insurers may also deny coverage for particular claims. Losses that are uninsured or exceed our coverage could materially and adversely affect our financial condition.
Current report
We have a small workforce and depend on a limited number of key personnel, and our lean operating structure may not be sufficient to support our business as a public company.
Current report
After disposing of our biomedical operations, we have kept a lean, technology-focused operating structure. We currently have approximately twelve full-time employees, and our AI research and algorithm engineering team has three full-time employees. Because a few individuals hold critical knowledge of our reasoning core, our verification algorithms, our datasets and our customer relationships, losing any of them could seriously disrupt our development, implementation and commercialization activities. In addition, a small team may lack enough people to separate duties properly and to cover the operational, compliance, financial reporting and governance work required of a Nasdaq-listed company while we pursue our business plan. We may be unable to hire additional qualified personnel when we need them or on acceptable terms.
Current report
Business interruptions caused by natural disasters, public health events, geopolitical events, power or telecommunications failures or other events beyond our control could disrupt our operations.
Current report
Substantially all of our employees are based in Hong Kong, and our SaaS platform runs on third-party cloud infrastructure. Typhoons, floods, earthquakes, pandemics or other public health emergencies, social unrest, geopolitical tensions, terrorism, power outages, telecommunications failures or cloud service outages could disrupt our research and development, customer implementation and support, and the availability of FinTruth. Because our workforce is concentrated in one location, a single event could affect most of our operations. Our business continuity and disaster recovery plans may not work as intended, and we may not have enough insurance to cover resulting losses.
Current report
We will need substantial additional capital to fund our operations and business plan, which may not be available on acceptable terms or at all.
Showing the first 40 of 61 passages. Open the source sections for the rest.
Removed paragraphs (183)
Previous report
We are an early stage cancer diagnostics company with a limited operating history, which may make it difficult to evaluate our current business and predict our future performance.
Previous report
We are at the early stage of commercializing our business. We have not started manufacturing or sales of any products or services. Our limited operating history may make it difficult to evaluate our current business and predict our future performance. Any assessment of our profitability or prediction about our future success or viability is subject to significant uncertainty.
Previous report
Taiwan and China’s precision oncology detection market is still in its early stage of development and rapidly evolving, and companies operating in this industry face a variety of risks. We may not have sufficient experience or resources to address risks frequently encountered in this industry, which include, among other things, our potential failure to:
Previous report
If we are unsuccessful in addressing any one or more of these risks, our business, financial condition and results of operations could be adversely affected.
Previous report
We may be unable to develop and commercialize our early cancer detection devices, chips or immunochromogenic kits on a timely basis, or at all.
Previous report
We are developing early cancer detection products and may develop and commercialize our cancer diagnostics products from time to time in the future. Developing early cancer detection and new cancer diagnostics products is a lengthy and complex process. New products may take time to commercialize, and their launch could be delayed or may not be successful.
Previous report
Our product development process involves various risks, and we may not be able to develop and commercialize any early cancer detection products or new precision oncology detection products on a timely basis, or at all. A product candidate that appears promising in the early phases of development may fail to reach the market for a number of reasons. For example:
Previous report
In addition, our competitors may develop and commercialize competing products faster than we are able to, in which case our results of operations could be adversely affected.
Previous report
If we fail to keep up with industry and technology developments in a timely and cost-effective manner, we may be unable to compete effectively and our business and prospects could suffer.
Previous report
Cancer early detection market is characterized by rapid changes, including technological and scientific breakthroughs, increasing amounts of data, frequent introductions of new tests, constant emergence of alternative diagnostic methods, and evolving industry standards. If we are not able to keep pace with these advances and increased customer expectations as a result of these advances and capture new market opportunities that develop as a result of these advances, our proprietary technologies could be rendered obsolete, our existing products and services and products and services we are developing could be rendered less clinically effective, and our future operations and prospects could suffer. To remain competitive, we must continuously upgrade our existing products and services and launch new products and services, to keep pace with these developments. We cannot assure you that these efforts will be successful.
Previous report
In addition, we must expend significant resources in order to continuously upgrade our existing products and services or launch new ones to keep pace with industry and technological advances. We may never realize a return on investment on these efforts, especially if the improved or new products and services fail to perform as expected, in which case our business, financial condition and results of operations could be adversely affected.
Previous report
If our products or services do not perform as expected, our operating results, reputation and business could suffer.
Previous report
Our success depends on the market confidence that we can provide reliable, high-quality cancer early detection products and services that will provide physicians with real-time clinically actionable diagnostic information. However, there is no assurance that our products and services will perform as expected at all times. Our tests may fail to accurately detect gene variants or incompletely or incorrectly identify the significance of genomic alterations, or contain other errors or mistakes due to a variety of reasons (such as malfunction of our laboratory equipment and degraded liquid biopsy or tissue samples provided by our delivery service providers), which may result in negative perception of our tests. In addition, inaccurate results or misunderstandings of, or inappropriate reliance on, the diagnostic information our tests provide could lead to, or be associated with, side effects or adverse events in patients who use our tests, including treatment-related death, and could lead to termination of our services or claims against us.
Previous report
We face risks related to natural disasters, health epidemics, civil and social disruption and other outbreaks, which could significantly disrupt our operations. In particular, the COVID-19 outbreak in China and worldwide has adversely affected, and may continue to adversely affect, our business, results of operations and financial condition.
Previous report
We are vulnerable to social and natural catastrophic events that are beyond our control, such as natural disasters, health epidemics, and other catastrophes, which may materially and adversely affect our business. Since December 2019, a novel strain of coronavirus, or COVID-19, has become widespread in China and around the world. In March 2020, the World Health Organization declared COVID-19 a pandemic, given its threat beyond a public health emergency of international concern that the organization had declared in January 2020. Since the beginning of 2020, China, Taiwan and many other countries have taken various restrictive measures to contain the virus’ spread, such as quarantines, travel restrictions and home office policies to avoid large-scale population movement and gathering. These restrictions had certain degree of impact on our research and development and production plan in Taiwan and China. COVID-19 has reduced the availability of labor and led to difficulties for employees to return to work and constraints of service chain interruption. Because of the uncertainty surrounding the COVID-19 outbreak, the business disruption and the related financial impact related to the outbreak of and response to the coronavirus cannot be reasonably estimated at this time.
Previous report
Recently, the COVID-19 situation has improved in Taiwan and China. With Taiwan relaxing its mask mandate on April 17, 2023, and China no longer enforcing the “zero-COVID” policy, our research and development have started to recover. However, the potential downturn brought by the COVID-19 outbreak is difficult to assess or predict and the full impact of the virus on our operations will depend on many factors beyond our control. The extent to which the COVID-19 outbreak impacts our business, results of operations and financial condition remains uncertain, and we are closely monitoring its impact on us. Our business, results of operations, financial conditions and prospects could be materially adversely affected to the extent that COVID-19 harms the Chinese and global economy in general, and the trading price of our shares of Common Stock may be adversely affected. To the extent the COVID-19 pandemic and the outbreak of other health epidemics adversely affect our business and financial results, they may also have the effect of heightening many of the other risks described in this “Risk Factors” section.
Previous report
If we cannot compete successfully with our competitors, we may be unable to increase or sustain our revenue or achieve and sustain profitability.
Previous report
Cancer early detection and screening market has become increasingly competitive, and we expect this competition to intensify further in the future. Some of our existing and potential future competitors may have longer operating histories, larger customer bases, more expansive brand recognition and deeper market penetration, substantially greater financial, technological and research and development resources and selling and marketing capabilities, and more favorable terms from suppliers. As a result, they may be able to respond more quickly to changes in customer requirements or preferences, develop faster, better and more expansive advancements for their technologies and tests, create and implement more successful strategies for the promotion and sale of their tests, adopt more aggressive pricing policies for their tests, secure supplies from vendors on more favorable terms or devote substantially more resources to infrastructure and system development. In addition, competitors may be acquired by, receive investments from or enter into other commercial relationships with larger, well-established and well-financed companies as the use of precision oncology detection increases. In addition, if we expand into international markets in the future, we could face competition from the companies in these markets.
Previous report
If we are unable to compete successfully with current and future competitors for these or any other reasons, we may be unable to increase market acceptance and sales volume of our tests, which could prevent us from maintaining or increasing our revenue levels or achieving or sustaining profitability or could otherwise negatively affect our performance.
Previous report
Our future success depends on our ability to promote our brand and protect our reputation. If we are unable to effectively promote our brand, our business may be adversely affected.
Previous report
We believe that enhancing and maintaining awareness of our trademarks欣戈赛 and sglcell are critical to achieving widespread acceptance of our microfluidic biochip products, gaining trust for our testing devices and attracting customers. Successful promotion of our brand depends largely on the quality of the products and services we offer and the effectiveness of our branding and marketing efforts. Currently, we rely primarily on our own sales and marketing team to promote our brand and our precision oncology detection products and testing services. We expect that our branding and marketing efforts will require us to incur significant expenses and devote substantial resources. We cannot guarantee that our sales and marketing efforts will be successful. Brand promotion activities may not lead to increased revenue in the near term, and, even if they do, any revenue increases may not offset the expenses we incur to promote our brand. Our failure to establish and promote our brand and any damage to our reputation will hinder our growth. In addition, our reputation may be undermined as a result of the negative publicity about our company or our industry in general. If precision oncology detection products or services provided by us or our competitors do not perform to customers’ expectations, it may result in lower confidence in precision oncology detection in general, which may in turn impair our operating results and our reputation. You can find more information regarding our intellectual properties in “Business – Intellectual Property.”
Previous report
Our research and development activities and laboratory operations depend upon our ability to attract and retain highly skilled scientists and technicians. We are also in strong need of sales and marketing personnel with the relevant technology background and industry expertise in order to effectively conduct our sales and marketing activities and increase our hospital network. We face intense competition for qualified individuals from numerous biotechnology and pharmaceutical companies, universities, governmental entities and other research institutions. We may be unable to attract and retain suitably qualified individuals, and our failure to do so could adversely affect our business.
Previous report
If we experience difficulties in recruiting subjects for clinical trials, our clinical development activities may be delayed or otherwise adversely affected.
Previous report
Completion of a clinical trial on time according to the trial plan depends, among other things, on our ability to recruit a sufficient number of subjects to participate in the trial until the end of the trial. We may encounter difficulties in recruiting subjects for clinical trials for a variety of reasons, including the base and nature of the subject population and the eligibility criteria for subjects defined in the trial plan. Our clinical trials will likely compete with other clinical trials, which will reduce the number and categories of subjects we can recruit, as some subjects who may choose to participate in our trials may instead choose to participate in trials conducted by other companies. Due to the limited number of qualified clinical investigators and clinical trial sites, we expect that some of our clinical trials will be conducted at the same clinical trial sites used by some of our competitors, which will result in subjects eligible to participate in our clinical trials at those clinical trial sites decrease in the number of people. Even if our clinical trials are able to enroll a sufficient number of subjects, delays in enrolling subjects may increase costs or affect the timing or outcomes of planned clinical trials, hindering the completion of those trials and hindering our progress adversely affect the ability of product candidates to develop.
Previous report
If we do not launch new products in a timely manner, our products may become obsolete and our results of operations may suffer.
Previous report
Technology in the cancer screening industry is constantly changing, new products are emerging, and industry standards continue to evolve. If new and improved products are not introduced in a timely manner, our products may become technologically obsolete or vulnerable to competition, and our revenue and results of operations could be impaired. Even if we develop new or improved products, our ability to bring those products to market may be limited by a variety of factors, including regulatory approvals and market demand. We invest significant financial and other resources in our research and development activities. The research and development process are lengthy and uncertain. The products we are currently developing may not be able to complete the development process or obtain the regulatory or other approvals required to bring such products to market in a timely manner or at all.
Previous report
Technological innovations often require significant time and investment before their commercial viability can be determined. We may not have the necessary financial resources to fund all such projects. In addition, even if we are able to successfully develop new or improved products, those products may not generate revenue in excess of development costs or achieve desirable financial returns and may become obsolete or due to changes in customer preferences or the introduction of advanced technology or functionality by competitors. Products or other factors resulting in a decline in competitiveness.
Previous report
As of the date of this Report, we have not conducted any clinical trials for our products. Uncertainties or failures in clinical trials of our product candidates could materially and adversely affect our business operations.
Previous report
We must conduct various clinical trials to demonstrate the sensitivity and specificity of our test prior to regulatory approval for marketing of our product candidates and depending on the type of our relevant product candidates, clinical trials may require large-scale prospective clinical studies, and such studies are far more rigorous and expensive than other existing tests or auxiliary diagnostic products. We have planned to conduct a multicenter registry trial in China to evaluate the performance of the pulmonary nodule benign and malignant determination kit. We may encounter a variety of contingencies while conducting or as a result of clinical trials that may delay or prevent us from obtaining regulatory approval or commercializing our product candidates, including but not limited to:
Previous report
There is no assurance that such trials will be completed in a timely or cost-effective manner, or that they will result in a commercially viable product. If clinical trials of any of our product candidates are delayed or terminated, the commercial prospects of that product candidate will be impaired and our ability to generate revenue from any such product candidate will be delayed. In addition, any delay in the completion of our clinical trials would increase our costs, slow down the development and approval process of our product candidate, and impair our ability to initiate product sales and generate related revenue for that product candidate. The occurrence of any of the above events could materially damage our business, financial condition and prospects.
Previous report
We have contracts with third parties for the future manufacturing, supply and registration applications of certain of our products, which supply could become limited or interrupted or may not be of satisfactory quality and quantity.
Previous report
We currently rely on third parties in the PRC for certain supplying, registration applications and future manufacturing of certain of our products. Any such reliance may increase the risk that we will not have sufficient quantities of our products, or such quantities at an acceptable cost or quality, which could delay, prevent or impair our development or commercialization efforts. Furthermore, all the contract manufacturers in the PRC for our products are subject to extensive PRC laws and regulations. These PRC laws and regulations govern manufacturing processes and procedures, including record keeping, and the implementation and operation of quality systems to control and assure the quality of investigational products and products approved for sale. Poor control of production processes can lead to the introduction of contaminants, or to inadvertent changes in the properties or stability of our products.
Previous report
We may be adversely affected by uncertainties and changes in China’s regulations on the cancer screening industry, and the lack of necessary approvals, licenses, registrations or filings in relation to our business may adversely affect our business, results of operations and prospects material adverse effects.
Previous report
Due to the relatively short history of the cancer screening industry in China, a comprehensive regulatory framework to regulate the industry has not yet been established. The possibility cannot be ruled out that certain industry practices, which we have also adopted, may be deemed to fail to fully comply with the existing laws and regulations in the PRC. As China’s laws and regulations on medical devices are still developing, and it is uncertain whether new laws, regulations or interpretations will be promulgated or adopted in the future, we cannot assure you that our early stage cancer detection devices will not be construed as non-compliance with applicable laws and regulations in the future. If the PRC government issues clear requirements for the approval of our devices, we intend to take the necessary steps to comply with those requirements. Our business and results of operations may be adversely affected if we fail to comply with existing or future requirements or are found to be otherwise non-compliant in the conduct of our business.
Previous report
If we fail to obtain, complete or maintain the required regulatory approvals, licenses, registrations or filings, or if there is a delay in obtaining, complete or maintain the required regulatory approvals, licenses, registrations or filings, we will not be able to commercialize our product candidates change, and our ability to generate revenue will be significantly compromised.
Previous report
Due to the relatively short history of the cancer screening industry in China, a comprehensive regulatory framework to regulate the industry has not yet been established. However, the significant aspects of the development and commercialization of our products have been strictly regulated in China. The process of obtaining regulatory approvals and complying with applicable laws and regulations requires significant time and financial resources. Applicants may face administrative or judicial sanctions if they fail to comply with applicable regulations during the product development process, the approval process, or at any time after approval. Such sanctions may include regulatory refusals to approve pending applications, revocation of approvals, revocation of licenses, clinical restrictions, voluntary or compulsory product recalls, product seizures, suspensions of production or distribution in whole or in part, injunctions, fines, refusals to government contracts, compensation, Hand over money or civil or criminal penalties. Failure to comply with these regulations may affect our business, financial business conditions and prospects are materially and adversely affected.
Previous report
Before obtaining regulatory approval for commercial sale of some of our products, we must demonstrate its effectiveness in a well-controlled clinical trial and, for approval in China, must be satisfied by NMPA that the product candidate is safe and effective for its intended use, and appropriate manufacturing and testing facilities, procedures and controls are in place. For now, only A+LCGuard is required by NMPA to complete clinical trial. Obtaining regulatory approval is a long, expensive and uncertain process, and approval may not be obtained. When we submit a registration application to NMPA, it will decide whether to accept or reject the submitted registration application. We cannot be certain that any submission will be approved by NMPA for registration review. NMPA may also slow down, suspend or terminate the review of our application, and any such circumstance will prolong the registration process for our products. Our product candidates may not receive regulatory approval for a number of reasons, including:
Previous report
Regulatory requirements and guidelines may also change, and we may, among other things, need to revise clinical trial plans submitted to applicable regulatory authorities to reflect such changes. We may make revisions that necessitate resubmission of the clinical trial proposal to the Institutional Review Board or Ethics Committee for reconsideration, which may affect the outcome of the clinical trial.
Previous report
The process of developing, obtaining regulatory approval, and commercializing medical device candidates is long, complex, and costly, both within China and abroad. Even if our product candidates are successful in obtaining regulatory approval, such approval may impose significant restrictions on the approved use, or require product labels to contain precautions or warnings, or require expensive and time-consuming post-approval clinical trials or surveillance as approval conditions of. If we are unable to obtain regulatory approvals for our product candidates in one or more jurisdictions, or any approvals come with significant restrictions, our target market will be reduced and our ability to realize the full market potential of our product candidates will be impaired. In addition, we may not be able to obtain sufficient financing or generate sufficient revenue and cash flow to continue developing any other product candidates in the future.
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Reworded paragraphs (19)
Previous wording
Our future success is significantly dependent upon the continued service of our senior management, such as Dr. Yi Lu, our chairman of the board of directors and chief executive officer. If we lose their services, we may not be able to locate suitable or qualified replacements, and we may incur additional expenses to recruit new senior management team members, which could severely disrupt our business and growth. In addition, if these personnel join our competitors or form a competing business, our business and prospects could be adversely affected.
Current wording
Our future success is significantly dependent upon the continued service of our senior management, such as Dr. Xiaomin Chen, our chairman of the board of directors and chief executive officer, and our engineering teams. If we lose their services, we may not be able to locate suitable or qualified replacements, and we may incur additional expenses to recruit new senior management team members, which could severely disrupt our business and growth. In addition, if these personnel join our competitors or form a competing business, our business and prospects could be adversely affected.
Previous wording
We have experienced significant cash outflow from operating activities since our inception. We had net cash outflow in operating activities of $5.8 million and $2.1 million for the years ended June 30, 2025 and 2024, respectively. The cost of continuing operations could further reduce our cash position, and an increase in our net cash outflow from operating activities could adversely affect our operations by reducing the amount of cash available to meet the cash needs for operating our business and to fund our investments in our business expansion.
Current wording
We have experienced significant cash outflow from operating activities since our inception. We had net cash outflow in operating activities from continuing operations of $0.96 million and $2.3 million for the years ended June 30, 2026 and 2025, respectively. We had net cash outflow in operating activities from discontinued operations of $0.99 million to and $3.5 million for the years ended June 30, 2026 and 2025, respectively. The cost of continuing operations could further reduce our cash position, and an increase in our net cash outflow from operating activities could adversely affect our operations by reducing the amount of cash available to meet the cash needs for operating our business and to fund our investments in our business expansion.
Previous wording
We had net current asset (liabilities) of $3.1 million and $0.3 million as of June 30, 2025 and 2024, respectively. We cannot guarantee that we will remain in a net current assets position in future, which would expose us to liquidity risk. Our future liquidity and ability to make additional capital investments necessary for our operations and business expansion will depend primarily on our ability to maintain sufficient cash and to obtain adequate external financing. There can be no assurance that we will be able to obtain any sources of financing.
Current wording
We had net current asset of $12.3 million as of June 30, 2026. We cannot guarantee that we will remain in a net current assets position in future, which would expose us to liquidity risk. Our future liquidity and ability to make additional capital investments necessary for our operations and business expansion will depend primarily on our ability to maintain sufficient cash and to obtain adequate external financing. There can be no assurance that we will be able to obtain any sources of financing.
Previous wording
We require substantial funding for our operations. If we cannot raise sufficient additional capital on acceptable terms, our business, financial condition and prospects may be adversely affected.
Current wording
We require substantial funding for our operations and have a limited operating history and limited revenue from FinTruth. If we cannot raise sufficient additional capital on acceptable terms, our business, financial condition and prospects may be adversely affected.
Previous wording
The incurrence of additional indebtedness or the issuance of certain equity securities could result in increased fixed payment obligations and could also result in certain additional restrictive covenants, such as limitations on our ability to incur additional debt or issue additional equity, limitations on our ability to acquire or license IP rights and other operating restrictions that could adversely impact our ability to conduct our business.
Current wording
The incurrence of additional indebtedness or the issuance of certain equity securities could result in increased fixed payment obligations and could also result in certain additional restrictive covenants, such as limitations on our ability to incur additional debt or issue additional equity, and other operating restrictions that could adversely impact our ability to conduct our business.
Previous wording
Since we have our subsidiaries in Shanghai and Hong Kong, economic, political and legal developments in the PRC will affect our business, financial condition, results of operations and prospects. Policies, regulations, rules, and the enforcement of laws of the PRC government can have significant effects on economic conditions in the PRC and the ability of businesses to operate profitably. Our ability to operate profitably in the PRC may be adversely affected by changes in policies by the PRC government, including changes in laws, regulations or their interpretation, particularly those dealing with the Internet, including censorship and other restriction on material which can be transmitted over the Internet, security, intellectual property, money laundering, taxation and other laws that affect our ability to operate business in China.
Current wording
Since we conduct our operations through our subsidiary in Hong Kong, economic, political and legal developments in the PRC will affect our business, financial condition, results of operations and prospects. Policies, regulations, rules, and the enforcement of laws of the PRC government can have significant effects on economic conditions in the PRC and the ability of businesses to operate profitably. Our ability to operate profitably in the PRC may be adversely affected by changes in policies by the PRC government, including changes in laws, regulations or their interpretation, particularly those dealing with the Internet, including censorship and other restriction on material which can be transmitted over the Internet, security, intellectual property, money laundering, taxation and other laws that affect our ability to operate business in China.
Previous wording
We face risks arising from China including risks and uncertainties regarding the enforcement of laws and that rules and regulations in China can change quickly with little advance notice. The Chinese government may intervene or influence the operations of our subsidiaries in Shanghai and Hong Kong at any time, or may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in the operations of our subsidiaries in Shanghai and Hong Kong and/or the value of our Common Stock.
Current wording
We face risks arising from China including risks and uncertainties regarding the enforcement of laws and that rules and regulations in China can change quickly with little advance notice. The Chinese government may intervene or influence the operations Hong Kong at any time, or may exert more control over offerings conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in the operations Hong Kong and/or the value of our Common Stock.
Previous wording
The Chinese government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in China through our subsidiaries in Shanghai and Hong Kong may be harmed by changes in laws and regulations in China, including those relating to securities regulation, data protection, cybersecurity and mergers and acquisitions and other matters. The PRC central or local governments may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our and our subsidiaries’ compliance with such regulations or interpretations.
Current wording
The Chinese government has exercised and continues to exercise substantial control over virtually every sector of the Chinese economy through regulation and state ownership. Our ability to operate in Hong Kong may be harmed by changes in laws and regulations in China, including those relating to securities regulation, data protection, cybersecurity and mergers and acquisitions and other matters. The PRC central or local governments may impose new, stricter regulations or interpretations of existing regulations that would require additional expenditures and efforts on our part to ensure our and our subsidiaries’ compliance with such regulations or interpretations.
Previous wording
Government actions in the future could significantly affect economic conditions in China or particular regions thereof, and could require our subsidiaries in Shanghai and Hong Kong to materially change their operating activities or divest ourselves of any interests we hold in Chinese assets. Our subsidiaries in Shanghai and Hong Kong may be subject to various government and regulatory interference. We may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply. Such subsidiaries’ operations could be adversely affected, directly or indirectly, by changes to existing laws or implementation of future laws and regulations relating to their business or industry.
Current wording
Government actions in the future could significantly affect economic conditions in China or particular regions thereof, and could require us in Hong Kong to materially change our operating activities or divest ourselves of any interests we hold in Chinese assets. We may be subject to various government and regulatory interference. We may incur increased costs necessary to comply with existing and newly adopted laws and regulations or penalties for any failure to comply. Our operations could be adversely affected, directly or indirectly, by changes to existing laws or implementation of future laws and regulations relating to their business or industry.
Previous wording
As of the date of this Report, we and our subsidiaries in the Mainland China and Hong Kong (1) are not required to obtain permissions from any PRC authorities to operate or issue our Common Stock to foreign investors, (2) are not subject to permission requirements from the CSRC, CAC or any other entity that is required to approve their operations in the Mainland China and Hong Kong, and (3) have not received or were denied such permissions by any PRC authorities. Nevertheless, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the “Opinions on Severely Cracking Down on Illegal Securities Activities According to Law,” which were made available to the public on July 6, 2021. The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies. The regulatory agencies like CSRC or CAC may impose fines and penalties on our operations in the Mainland China or Hong Kong, limit our ability to pay dividends outside of the Mainland China or Hong Kong, limit our operations in the Mainland China or Hong Kong, delay or restrict the repatriation of the credits from the ELOC Agreement or any future financing activities into the Mainland China or Hong Kong or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities. The CSRC, the CAC, or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt future offerings before settlement and delivery of our Common Stock. Consequently, if you engage in market trading or other activities in anticipation of and prior to settlement and delivery, you do so at the risk that settlement and delivery may not occur. In addition, if the CSRC, the CAC or other regulatory PRC agencies later promulgate new rules requiring that we obtain their approvals for future offerings, we may be unable to obtain a waiver of such approval requirements, if and when procedures are established to obtain such a waiver. Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on the trading price of our securities.
Current wording
As of the date of this Report, we (1) are not required to obtain permissions from any PRC authorities to operate or issue our Common Stock to foreign investors, (2) are not subject to permission requirements from the CSRC, CAC or any other entity that is required to approve our operations in the Mainland China and Hong Kong, and (3) have not received or were denied such permissions by any PRC authorities. Nevertheless, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the “Opinions on Severely Cracking Down on Illegal Securities Activities According to Law,” which were made available to the public on July 6, 2021. The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies. The regulatory agencies like CSRC or CAC may impose fines and penalties on our operations in the Mainland China or Hong Kong, limit our ability to pay dividends outside of the Mainland China or Hong Kong, limit our operations in the Mainland China or Hong Kong, delay or restrict the repatriation of the credits from the ELOC Agreement or any future financing activities into the Mainland China or Hong Kong or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities. The CSRC, the CAC, or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt future offerings before settlement and delivery of our Common Stock. Consequently, if you engage in market trading or other activities in anticipation of and prior to settlement and delivery, you do so at the risk that settlement and delivery may not occur. In addition, if the CSRC, the CAC or other regulatory PRC agencies later promulgate new rules requiring that we obtain their approvals for future offerings, we may be unable to obtain a waiver of such approval requirements, if and when procedures are established to obtain such a waiver. Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on the trading price of our securities.
Previous wording
Although Advanced Biomed HK is a holding company with no operations and is in compliance with current Mainland China and Hong Kong laws and regulations, it may be subject to similar risks faced by our Shanghai subsidiary in the future if the Chinese government were to exert more control over Hong Kong business or impose new laws or regulations on business activities in Hong Kong, which often comes with little advance notice. In that case, we cannot guarantee you that we can timely comply with any new laws and regulations, which could materially affect our operations and significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless.
Current wording
Although Acellent is in compliance with current Hong Kong laws and regulations, it may be subject to risks similar to those faced by companies operating in mainland China in the future if the Chinese government were to exert more control over Hong Kong business or impose new laws or regulations on business activities in Hong Kong, which often comes with little advance notice. In that case, we cannot guarantee you that we can timely comply with any new laws and regulations, which could materially affect our operations and significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly decline or be worthless.
Previous wording
The recent developments would add uncertainties to our offering and we cannot assure you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us since we are an emerging growth company and substantially all of our operations are conducted in China. The Holding Foreign Companies Accountable Act, which requires that the PCAOB be permitted to inspect an issuer’s public accounting firm within three years, may result in the delisting of our Company or prohibition of trading in our Common Stock in the future if the PCAOB is unable to inspect our accounting firm at such future time. Further, the AHFCAA which was later signed into law in the Consolidated Appropriations Act, reduces the period for foreign companies to comply with PCAOB audits to two consecutive years instead of three, thus reducing the time period for triggering the prohibition on trading, and this ultimately could result in our Common Stock being delisted by an exchange.
Current wording
The recent developments would add uncertainties to our offering and we cannot assure you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us since we are an emerging growth company and substantially all of our operations are conducted in Hong Kong. The Holding Foreign Companies Accountable Act, which requires that the PCAOB be permitted to inspect an issuer’s public accounting firm within three years, may result in the delisting of our Company or prohibition of trading in our Common Stock in the future if the PCAOB is unable to inspect our accounting firm at such future time. Further, the AHFCAA which was later signed into law in the Consolidated Appropriations Act, reduces the period for foreign companies to comply with PCAOB audits to two consecutive years instead of three, thus reducing the time period for triggering the prohibition on trading, and this ultimately could result in our Common Stock being delisted by an exchange.
Previous wording
The PRC has enacted laws and regulations governing internet access and the distribution of products, services, news, information, audio-video programs and other content through the Internet. In the past, the PRC government has prohibited the distribution of information through the Internet that it deems to be in violation of PRC laws and regulations. If any of our Internet information is deemed by the PRC government to violate any content restrictions, we would not be able to continue to display such content and could become subject to penalties, including confiscation of income, fines, suspension of business and revocation of required licenses, which could materially and adversely affect our PRC businesses, financial condition and results of operations. We may also be subject to potential liability for any unlawful actions of our customers or users of our website or for content we distribute that is deemed inappropriate. It may be difficult to determine the type of content that may result in liability to us, and if we are found to be liable, we may be prevented from operating our website in the PRC.
Current wording
The PRC has enacted laws and regulations governing internet access and the distribution of products, services, news, information, audio-video programs and other content through the Internet. In the past, the PRC government has prohibited the distribution of information through the Internet that it deems to be in violation of PRC laws and regulations. If any of our Internet information is deemed by the PRC government to violate any content restrictions, we would not be able to continue to display such content and could become subject to penalties, including confiscation of income, fines, suspension of business and revocation of required licenses, which could materially and adversely affect our business, financial condition and results of operations. We may also be subject to potential liability for any unlawful actions of our customers or users of our website or for content we distribute that is deemed inappropriate. It may be difficult to determine the type of content that may result in liability to us, and if we are found to be liable, we may be prevented from operating our website in the PRC.
Previous wording
As a holding company, we may rely on dividends and other distributions from our Shanghai subsidiary for cash requirements. If our Shanghai subsidiary incurs any debts, the instruments governing such debts may restrict its ability to pay dividends to us. To the extent cash or assets in the business is in the PRC or the Shanghai subsidiary, the cash or assets may not be available to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and limitations on our or Shanghai subsidiary’s ability by the PRC government to transfer cash or assets.
Current wording
As a holding company, we may rely on dividends and other distributions from Acellent, our Hong Kong subsidiary, for our cash requirements. There are currently no restrictions or limitations under Hong Kong law on the conversion of Hong Kong dollars into foreign currencies or the remittance of currencies out of Hong Kong, or on the ability of Acellent to transfer cash to us or to pay dividends. However, if the PRC government were to impose restrictions or limitations on our or Acellent’s ability to transfer cash or assets, the cash or assets of Acellent may not be available to fund our operations or for other use outside of Hong Kong. In addition, if Acellent incurs debt on its own behalf, the instruments governing the debt may restrict its ability to pay dividends or make other payments to us.
Previous wording
Our Chairman Dr. Yi Lu owns a substantial portion of our outstanding shares of Common Stock and could significantly influence the outcome of our corporate matters.
Current wording
Our former Chairman and Chief Executive Officer, Dr. Yi Lu, and our current Chairman and Chief Executive Officer, Dr. Xiaomin Chen, own a substantial portion of our outstanding shares of Common Stock and could each significantly influence the outcome of our corporate matters.
Previous wording
Our Chairman and Chief Executive Officer, Dr. Yi Lu, beneficially owns 31.00% of our outstanding shares of Common Stock. As a result, Mr. Lu is able to exercise significant influence over all matters that require us to obtain stockholder approval, including the election of directors to our board and approval of significant corporate transactions that we may consider, such as a merger or sale of our company or its assets. This concentration of ownership in our shares by Mr. Lu will limit other stockholders’ ability to influence corporate matters and may have the effect of delaying or preventing a third party from acquiring control over us.
Current wording
As of October 13, 2026, Dr. Yi Lu “Stanley”, our former Chairman and Chief Executive Officer, beneficially owned approximately 20.30% of our outstanding shares of Common Stock, and Dr. Xiaomin Chen, our Chairman and Chief Executive Officer, beneficially owned approximately 16.34% of our outstanding shares of Common Stock. As a result, each of Dr. Lu and Dr. Chen is able to exercise significant influence over all matters that require us to obtain stockholder approval, including the election of directors to our board and approval of significant corporate transactions that we may consider, such as a merger or sale of our company or its assets. This concentration of ownership in our shares by Dr. Lu and Dr. Chen will limit other stockholders’ ability to influence corporate matters and may have the effect of delaying or preventing a third party from acquiring control over us.
Previous wording
If we issue additional shares of Common Stock, or securities convertible into or exchangeable or exercisable for Common Stock, our stockholders, including investors who purchase shares of Common Stock in the Resale Offering, may experience dilution, and any such issuances may result in downward pressure on the price of our Common Stock. We also cannot assure you that we will be able to sell shares or other securities in any future offering at a price per share that is equal to or greater than the price per share paid by investors in the Resale Offering, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders.
Current wording
If we issue additional shares of Common Stock, or securities convertible into or exchangeable or exercisable for Common Stock, our stockholders may experience dilution, and any such issuances may result in downward pressure on the price of our Common Stock. We also cannot assure you that we will be able to sell shares or other securities in any future offering at a price per share that is equal to or greater than the price per share paid by our existing stockholders, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders.
Previous wording
Recently, there have been instances of extreme stock price run-ups followed by rapid price declines and strong stock price volatility with a number of recent initial public offerings, especially among companies with relatively smaller public floats. If you purchase our Common Stock in the Resale Offering, you may not be able to sell those shares at or above the Initial Public Offering price or the Resale Offering price. In particular, our Common Stock may be subject to rapid and substantial price volatility, low volumes of trades and large spreads in bid and ask prices, given that we will have relatively small public floats after the Resale Offering, and the Selling Stockholder is offering Resale Shares through this Resale Offering. Such volatility, including any stock price run-ups, may be unrelated to our actual or expected operating performance, financial condition or prospects.
Current wording
Recently, there have been instances of extreme stock price run-ups followed by rapid price declines and strong stock price volatility with a number of recent initial public offerings, especially among companies with relatively smaller public floats. In particular, our Common Stock may be subject to rapid and substantial price volatility, low volumes of trades and large spreads in bid and ask prices. Such volatility, including any stock price run-ups, may be unrelated to our actual or expected operating performance, financial condition or prospects.
Previous wording
The market price of our shares could decline as a result of sales of substantial amounts of our shares in the public market or the perception that these sales could occur, including the sale of Resale Shares by the Selling Stockholder. In addition, these factors could make it more difficult for us to raise funds through future offerings of our Common Stock. 21,640,000 shares of our Common Stock are outstanding immediately before the Resale Offering. All of the shares sold in the Resale Offering will be freely transferable without restriction or further registration under the Securities Act. Certain Common Stock are “restricted securities” as defined in Rule 144, as they are subject to lock-up in connection with our Initial Public Offering. These shares may be sold in the future without registration under the Securities Act to the extent permitted by Rule 144 or other exemptions under the Securities Act.
Current wording
The market price of our shares could decline as a result of sales of substantial amounts of our shares in the public market or the perception that these sales could occur. In addition, these factors could make it more difficult for us to raise funds through future offerings of our Common Stock. As of October 13, 2026, 1,652,133 shares of our Common Stock were outstanding. The 200,000 shares issued in our January 2026 private placement, the 82,536 commitment fee shares issued under the ELOC Agreement and the 270,000 shares issued in the acquisition of Acellent are “restricted securities” that may become eligible for resale under Rule 144. Certain Common Stock are “restricted securities” as defined in Rule 144, as they are subject to lock-up in connection with our Initial Public Offering. These shares may be sold in the future without registration under the Securities Act to the extent permitted by Rule 144 or other exemptions under the Securities Act.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
To the extent cash or assets in our business are in Hong Kong or held by our Hong Kong subsidiary, such cash or assets may not be available to fund our operations or for other use outside of Hong Kong due to interventions in or the imposition of restrictions and limitations by the PRC government.
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Risks Related to Doing Business in China
Previous report — wording carried elsewhere
As of the date of this Report, we believe we and our subsidiaries in the Mainland China and Hong Kong, (1) are not required to obtain permissions from any PRC authorities to operate or issue our Common Stock to foreign investors, (2) are not subject to permission requirements from the CSRC, CAC or any other entity that is required to approve of our PRC Subsidiaries’ operations, and (3) have not received or were denied such permissions by any PRC authorities.